English Translation of Financial Statements and a Report Originally Issued in Chinese

Ticker: 3189

Kinsus Interconnect Technology Corp. and Subsidiaries Consolidated Financial Statements With Review Report of Independent Auditors AS OF DECEMBER 31, 2021 AND 2020 And For The Years Then Ended

Address: No. 1245, Chung Hua Rd., Hsinwu District, Taoyuan City, Taiwan 32747 Telephone: (03)487-1919

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.

English Translation of Financial Statements and a Report Originally Issued in Chinese

	Index Item Page
1.	Cover sheet	1
2.	Index	2
3.	Management representation letter	3
4.	Independent Auditors' Report	4-9
5.	Consolidated balance sheets	10-11
6.	Consolidated statements of comprehensive income	12
7.	Consolidated statements of changes in equity	13
8.	Consolidated statements of cash flows	14
9.	Footnotes to the consolidated financial statements
(1)	History and organization	15
(2)	Date and procedures of authorization of financial statements for issue	15
(3)	Newly issued or revised standards and interpretations	15-20
(4)	Summary of significant accounting policies	20-48
(5)	Significant accounting judgments, estimates and assumptions	48-51
(6)	Contents of significant accounts	51-96
(7)	Related party transactions	97-101
(8)	Assets pledged as collaterals	101
(9)	Significant contingencies and unrecognized contract commitments	101-102
	(10) Losses due to major disasters	102
	(11) Significant subsequent events	103
	(12) Others	103-112
	(13) Other disclosures
	1. Additional disclosures required by the Taiwan Securities and Futures Bureau	112-113
	2. Information on investees	113-114
	3. Information on investments in Mainland China	115-120
	4. Information on major shareholders	120
	(14) Operating segment	120-122

Consolidated Financial Statements

MANAGEMENT REPRESENTATION LETTER

The entities that are required to be included in the combined financial statements of Kinsus Interconnect Technology Corp. as of December 31, 2021 and for the year then ended under the Criteria Governing the Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises are the same as those included in the consolidated financial statements prepared in conformity with the International Financial Reporting Standard No. 10, "Consolidated Financial Statements." In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, Kinsus Interconnect Technology Corp. and Subsidiaries do not prepare a separate set of combined financial statements.

Very truly yours,

Kinsus Interconnect Technology Corp.

Liao, Sih-Jheng

Chairman

February 15 th, 2022

English Translation of Consolidated Financial Statements Originally Issued in Chinese Kinsus Interconnect Technology Corp. and Subsidiaries Consolidated Balance Sheets As of December 31, 2021 and 2020

(Amounts Expressed In Thousands of New Taiwan Dollars)

	Assets			As of December 31, 2021		As of December 31, 2020
Code	Accounts	Notes	Amount	%	Amount	%
	Current assets
1100	Cash and cash equivalents	4, 6(1)	\$15,332,027	26	\$11,664,932	27
1110	Financial assets at fair value through profit or loss	4, 6(2)	616,080	1	1,594,063	4
1136	Financial assets carried at amortized cost	4, 6(3), 8	20,057	-	467,167	1
1150	Notes receivable, net	4, 6(5)	4,200	-	1,182	-
1170	Accounts receivable, net	4, 6(6)	5,648,004	10	4,377,155	10
1180	Accounts receivable - related parties, net	6(6), 7	26,311	-	24,862	-
1200	Other receivables		406,415	1	141,161	-
1210	Other receivables - related parties	7	367	-	4,114	-
1310	Inventories, net	4, 6(7)	3,465,944	6	2,889,017	7
1410	Prepayments		532,717	1	212,742	1
1470	Other current assets		372,182	-	287,596	1
11xx	Total current assets		26,424,304	45	21,663,991	51
	Non-current assets
1517	Financial asset at fair value through OCI	4, 6(4)	51,000	-	51,000	-
1550	Investment accounted for under equity method	4, 6(8)	325,005	1	298,789	1
1600	Property, plant and equipment, net	4, 6(9), 8, 9	24,413,455	42	18,080,810	42
1755	Right-of-use asset	4, 6(23)	353,295	1	311,732	1
1780	Intangible assets	4, 6(10)	33,218	-	32,105	-
1840	Deferred income tax assets	4, 6(27)	23,053	-	28,262	-
1900	Other non-current assets	6(11), 7, 8	91,805	-	120,921	-
1915	Prepayment for acquiring machinery	6(9), 9	6,671,013	11	2,196,342	5
15xx	Total non-current assets		31,961,844	55	21,119,961	49

1xxx	Total Assets		\$58,386,148	100	\$42,783,952	100

English Translation of Consolidated Financial Statements Originally Issued in Chinese Kinsus Interconnect Technology Corp. and Subsidiaries Consolidated Balance Sheets-(Continued) As of December 31, 2021 and 2020 (Amounts Expressed In Thousands of New Taiwan Dollars)

	Liabilities and Equity	As of December 31, 2021		As of December 31, 2020
Code	Accounts	Notes	Amount	%	Amount	%
	Current liabilities
2100	Short-term loans	6(12)	\$1,099,846	2	\$2,640,307	6
2130	Contract liability	4, 6(21)	111,350	-	161,731	-
2150	Notes payable		28,636	-	46,420	-
2170	Accounts payable		2,886,877	5	2,358,805	6
2200	Other payables	6(13), 7	7,234,272	13	3,933,209	9
2230	Current income tax liabilities	4, 6(27)	754,071	1	265,246	1
2280	Lease liability	4, 6(23)	52,396	-	41,846	-
2300	Other current liabilities	6(14)	1,634,143	3	1,076,669	3
2365	Refund liability	4, 6(15)	181,108	-	206,517	-
21xx	Total current liabilities		13,982,699	24	10,730,750	25
	Non-current liabilities
2540	Long-term loans	6(16), 8	9,387,273	16	2,641,811	6
2570	Deferred income tax liabilities	4, 6(27)	26,016	-	27,763	-
2580	Lease liability	4, 6(23)	109,107	-	64,400	-
2600	Other non-current liabilities	6(17)	1,891,955	3	129,669	-
25xx	Total non-current liabilities		11,414,351	19	2,863,643	6

2xxx	Total liabilities		25,397,050	43	13,594,393	31

31xx	Equity attributable to shareholders of the parent
3100	Capital	6(19)
3110	Common stock		4,508,441	8	4,508,625	11
3200	Capital surplus	6(19)	6,633,051	11	6,632,030	16
3300	Retained earnings	6(19)
3310	Legal reserve		3,700,821	6	3,647,505	9
3320	Special reserve		181,016	-	183,405	-
3350	Unappropriated earnings		14,249,110	25	10,882,082	25
3400	Other components of equity		(203,107)	-	(183,852)	-
3500	Treasury Stock	6(19)	-	-	(143)	-
36xx	Non-controlling interests	6(19)	3,919,766	7	3,519,907	8
3xxx	Total equity		32,989,098	57	29,189,559	69

	Total liabilities and equity		\$58,386,148	100	\$42,783,952	100

English Translation of Consolidated Financial Statements Originally Issued in Chinese Kinsus Interconnect Technology Corp. and Subsidiaries Consolidated Statements of Comprehensive Income For the Years Ended December 31, 2021 and 2020 (Amounts Expressed in Thousands of New Taiwan Dollars, Except for Earnings per Share)

			2021		2020
Code	Items	Notes	Amount	%	Amount	%
4000	Operating revenues	4, 6(21), 7	\$35,672,763	100	\$27,098,474	100
5000	Operating costs	7	(25,146,918)	(70)	(21,279,420)	(79)
5900	Gross profit		10,525,845	30	5,819,054	21
6000	Operating expenses	7
	6100 Sales and marketing		(963,383)	(3)	(867,333)	(3)
	6200 General and administrative		(2,055,373)	(6)	(1,289,140)	(5)
	6300 Research and development		(2,495,688)	(7)	(2,328,146)	(8)
	6450 Expected credit gains (losses)	4, 6(22)	(6,835)	-	6,144	-
	Total operating expenses		(5,521,279)	(16)	(4,478,475)	(16)
6900	Operating income		5,004,566	14	1,340,579	5

7000	Non-operating incomes and expenses
	7100 Interest income	6(25)	34,396	-	43,405	-
	7010 Other incomes	6(25), 7	218,184	1	278,691	1
	7020 Other gains or losses	6(25), 7	(39,941)	-	(229,122)	(1)
	7050 Finance costs	6(25)	(81,133)	-	(76,703)	-
	7060 Share of the profit or loss of associates and joint ventures	6(8)	27,839	-	(233,581)	(1)
	Total non-operating incomes and expenses		159,345	1	(217,310)	(1)

7900	Income before income tax		5,163,911	15	1,123,269	4
7950	Income tax expense	4, 6(27)	(671,803)	(2)	(193,826)	(1)
8200	Net income		4,492,108	13	929,443	3

8300 8310	Other comprehensive income (loss) Item that not be reclassified to profit or loss	6(26)
	8311 Actuarial gain (loss) from defined benefit plans		9,757	-	(8,835)	-
8360	Items that may be reclassified subsequently to profit or loss
	8361 Exchange differences on translation of foreign operations		(32,403)	-	(8,107)	-
	8370 Share of the other comprehensive income (loss) of associates and joint ventures		(1,623)	-	(5,889)	-
	Total other comprehensive income (loss), net of tax		(24,269)	-	(22,831)	-
8500	Total comprehensive income		\$4,467,839	13	\$906,612	3

8600	Net income attributable to:
	8610 Shareholders of the parent		\$3,858,984	11	\$541,914	2
	8620 Non-controlling interests		633,124	2	387,529	1
			\$4,492,108	13	\$929,443	3
8700	Comprehensive income attributable to:
	8710 Shareholders of the parent		\$3,846,649	11	\$535,468	2
	8720 Non-controlling interests		621,190	2	371,144 \$906,612	1 3
			\$4,467,839	13
	9750 Earnings per share-basic (in NTD)	6(28)	\$8.56		\$1.21
	9850 Earnings per share-diluted (in NTD)	6(28)	\$8.51		\$1.20

Kinsus Interconnect Technology Corp. and Subsidiaries

Consolidated Statements of Changes in Equity

For the Years Ended December 31, 2021 and 2020

(Amounts Expressed In Thousands of New Taiwan Dollars)

			Equity Attributable to Shareholders of the Parent
					Retained Earnings		Others
		Common Stock	Capital Surplus	Legal Reserve	Special Reserve	Unappropriated Earnings	Exchange differences arising on translation of foreign operations	Unearned Employee Benefit	Treasury Stock	Total	Non-controlling Interests	Total Equity
Code	Items	3100	3200	3310	3320	3350	3410	3490	3500	31XX	36XX	3XXX
	A1 Balance as of January 1, 2020	\$4,510,738	\$6,637,742	\$3,647,505	\$100,384	\$10,882,980	\$(183,404)	\$(28,592)	\$(332)	\$25,567,021	\$3,270,679	\$28,837,700
	Appropriation and distribution of 2019 earnings
	B3 Special reserve				83,021	(83,021)				-		-
	B5 Cash dividends-common shares					(451,039)				(451,039)		(451,039)
	D1 Net income for 2020					541,914				541,914	387,529	929,443
	D3 Other comprehensive income (loss), net of tax, for 2020					(8,835)	2,389			(6,446)	(16,385)	(22,831)
	D5 Total comprehensive income (loss)	-	-	-	-	533,079	2,389	-	-	535,468	371,144	906,612
	O1 Non-controlling interests increase (decrease)										(121,916)	(121,916)
	T1 Employee restricted shares for cancellation and others	(2,113)	(5,712)			83		25,755	189	18,202		18,202
	Z1 Balance as of December 31, 2020	\$4,508,625	\$6,632,030	\$3,647,505	\$183,405	\$10,882,082	\$(181,015)	\$(2,837)	\$(143)	\$25,669,652	\$3,519,907	\$29,189,559

	A1 Balance as of January 1, 2021	\$4,508,625	\$6,632,030	\$3,647,505	\$183,405	\$10,882,082	\$(181,015)	\$(2,837)	\$(143)	\$25,669,652	\$3,519,907	\$29,189,559
	Appropriation and distribution of 2020 earnings
	B1 Legal reserve			53,316		(53,316)				-		-
	B3 Special reserve				(2,389)	2,389				-		-
	B5 Cash dividends-common shares					(450,847)				(450,847)		(450,847)
	D1 Net income for 2021					3,858,984				3,858,984	633,124	4,492,108
	D3 Other comprehensive income (loss), net of tax, for 2021					9,757	(22,092)			(12,335)	(11,934)	(24,269)
	D5 Total comprehensive income (loss)	-	-	-	-	3,868,741	(22,092)	-	-	3,846,649	621,190	4,467,839
	H3 Reorganization		1			(1)				-		-
	O1 Non-controlling interests increase (decrease)										(221,331)	(221,331)
	T1 Employee restricted shares for cancellation and others	(184)	1,020			62		2,837	143	3,878		3,878
	Z1 Balance as of December 31, 2021	\$4,508,441	\$6,633,051	\$3,700,821	\$181,016	\$14,249,110	\$(203,107)	\$-	\$-	\$29,069,332	\$3,919,766	\$32,989,098

Kinsus Interconnect Technology Corp. and Subsidiaries Consolidated Statements of Cash Flows For the Years Ended December 31, 2021 and 2020 (Amounts Expressed in Thousands of New Taiwan Dollars)

Code	Items	2021	2020	Code	Items	2021	2020
AAAA	Cash flows from operating activities:			BBBB	Cash flows from investing activities:
A10000	Income before income tax	\$5,163,911	\$1,123,269	B00010	Acquisition of Financial asset measured at fair value through OCI	-	(1,000)
A20000	Adjustments:			B00040	Decrease (increase) in financial assets measured at amortized cost	447,110	(44,110)
A20010	Income and expense adjustments:			B02700	Acquisition of property, plant and equipment	(13,383,710)	(2,835,656)
A20100	Depreciation (including right-of-use assets)	4,330,894	4,377,815	B02800	Proceeds from disposal of property, plant and equipment	60,079	45,141
A20200	Amortization	46,518	39,654	B03800	Decrease (increase) in refundable deposits	29,116	(32,852)
A20300	Expected credit losses (gain on recovery)	6,835	(6,144)	B04500	Acquisition of intangible assets	(47,652)	(41,024)
A20400	Net gain of financial assets at fair value through P/L	(1,939)	(5,529)	BBBB	Net cash provided by (used in) investing activities	(12,895,057)	(2,909,501)
A20900	Interest expense	81,133	76,703
A21200	Interest income	(34,396)	(43,405)	CCCC	Cash flows from financing activities:
A21900	Cost of share based payment	3,836	19,915	C00100	Increase in (repayment of) short-term loans	(1,540,461)	(1,455,794)
A22300	Share of profit or loss of associates and joint ventures	(27,839)	233,581	C01600	Increase in long-term loans	7,663,644	1,814,930
A22500	Gain on disposal of property, plant and equipment	(18,739)	105,648	C01700	Repayments of long-term loans	(1,148,482)	(1,218,410)
A23700	Impairment loss on non-financial assets	32,785	19,627	C03000	Increase (decrease) in deposits received	1,747,172	29,399
A29900	Loss (gain) on lease modification	(710)	(160)	C04020	Cash payments for the principal portion of the lease liability	(50,176)	(122,692)
A29900	Loss (gain) on government grants	(8,457)	(3,458)	C04500	Cash dividends	(450,847)	(451,039)
A30000	Changes in operating assets and liabilities:			C05800	Increase (decrease) in non-controlling interests	(221,331)	(121,916)
A31110	Financial assets at fair value through P/L	979,922	(249,702)	CCCC	Net cash provided by (used in) financing activities	5,999,519	(1,525,522)
A31130	Notes receivable	(3,018)	3,736
A31150	Accounts receivable	(1,277,678)	(761,461)	DDDD	Effect of exchange rate changes	(11,798)	29,383
A31160	Accounts receivable - related parties	(1,449)	86,461
A31180	Other receivables	(265,847)	190,834	EEEE	Increase (decrease) in cash and cash equivalents	3,667,095	952,829
A31190	Other receivables - related parties	3,747	1,787	E00100	Cash and cash equivalents at beginning of period	11,664,932	10,712,103
A31200	Inventories	(576,927)	(436,042)	E00200	Cash and cash equivalents at end of period	\$15,332,027	\$11,664,932
A31220	Prepayments	(319,975)	(62,204)
A31240	Other current assets	(84,586)	(88,924)
A32125	Contract liabilities	(50,381)	89,105
A32130	Notes payable	(17,784)	9,244
A32150	Accounts payable	528,072	134,234
A32180	Other payables	1,497,003	484,157
A32230	Other current liabilities	827,790	24,833
A32240	Net defined benefit liability	(4,350)	(4,240)
A32990	Refund liability	(25,409)	131,652
A33000	Cash generated from (used in) operations 營運產生之現金流入 (出)	10,782,962	5,490,986
A33100	Interest received	34,986	44,032
A33300	Interest paid	(65,126)	(73,072)
A33500	Income tax paid	(178,391)	(103,477)
AAAA	Net cash provided by (used in) operating activities	10,574,431	5,358,469

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued) English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to the Consolidated Financial Statements (Amounts Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

1. HISTORY AND ORGANIZATION

Kinsus Interconnect Technology Corp. (referred to "the Company") was established on September 11, 2000. Its main business activities include the manufacture of electronic products, the whole-sale and retail-sale of electronic materials, and the consultation services of business operation and management. The Company's stocks have been governmentally approved on May 20, 2004 to be listed and traded in Taiwan Stock Exchange starting November 1, 2004. The registered business premise and main operation address is at No. 1245, Chung Hua Rd., Hsinwu District, Taoyuan City, Taiwan 32747.

Pegatron Corporation is the ultimate controller of the Group to which the Company belongs.

2. DATE AND PROCEDURE OF AUTHORIZATION FOR FINANCIAL STATEMENTS ISSUANCE

The consolidated financial statements of the Company and its subsidiaries ("the Group") were authorized to be issued in accordance with a resolution of the Board of Directors'meeting held on February 15, 2022.

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 recognized by Financial Supervisory Commission ("FSC") and become effective for annual periods beginning on or after January 1, 2021. The new standards and amendments had no material impact on the Group.

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

		Effective Date
Items	New, Revised or Amended Standards and Interpretations	issued by IASB
a	Narrow-scope amendments of IFRS, including Amendments	January 1, 2022
	to IFRS 3, Amendments to IAS 16, Amendments to IAS 37
	and the Annual Improvements

(A) Narrow-scope amendments of IFRS, including Amendments to IFRS 3, Amendments to IAS 16, Amendments to IAS 37 and the Annual Improvements
(a) Updating a Reference to the Conceptual Framework (Amendments to IFRS 3)

The amendments updated IFRS 3 by replacing a reference to an old version of the Conceptual Framework for Financial Reporting with a reference to the latest version, which was issued in March 2018. The amendments also added an exception to the recognition principle of IFRS 3 to avoid the issue of potential "day 2" gains or losses arising for liabilities and contingent liabilities. Besides, the amendments clarify existing guidance in IFRS 3 for contingent assets that would not be affected by replacing the reference to the Conceptual Framework.

(b) Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16)

The amendments prohibit a company from deducting from the cost of property, plant and equipment amounts received from selling items produced while the company is preparing the asset for its intended use. Instead, a company will recognise such sales proceeds and related cost in profit or loss.

The amendments clarify what costs a company should include as the cost of fulfilling a contract when assessing whether a contract is onerous.

(d) Annual Improvements to IFRS Standards 2018 - 2020

Amendment to IFRS 1

The amendment simplifies the application of IFRS 1 by a subsidiary that becomes a first-time adopter after its parent in relation to the measurement of cumulative translation differences.

Amendment to IFRS 9 Financial Instruments

The amendment clarifies the fees a company includes when assessing whether the terms of a new or modified financial liability are substantially different from the terms of the original financial liability.

Amendment to Illustrative Examples Accompanying IFRS 16 Leases

The amendment to Illustrative Example 13 accompanying IFRS 16 modifies the treatment of lease incentives relating to lessee's leasehold improvements.

Amendment to IAS 41

The amendment removes a requirement to exclude cash flows from taxation when measuring fair value thereby aligning the fair value measurement requirements in IAS 41 with those in other IFRS Standards.

The abovementioned standards and interpretations were issued by IASB and endorsed by FSC so that they are applicable for annual period beginning on or after January 1, 2022. The Group assesses all standards and interpretations have no material impact on the Group.

(3)Standards or interpretations issued, revised or amended, by 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.

		Effective Date
Items	New, Revised or Amended Standards and Interpretations	issued by IASB
a	IFRS 10 "Consolidated Financial Statements" and IAS 28	To be determined
	"Investments in Associates and Joint Ventures" – Sale or	by IASB
	Contribution of Assets between an Investor and its Associate
	or Joint Ventures
b	IFRS 17 "Insurance Contracts"	January 1, 2023
c	Classification of Liabilities as Current or Non-current –	January 1, 2023
	Amendments to IAS 1
d	Disclosure Initiative – Accounting Policies – Amendments to	January 1, 2023
	IAS 1
e	Definition of Accounting Estimates – Amendments to IAS 8	January 1, 2023
f	Deferred Tax related to Assets and Liabilities arising from a	January 1, 2023
	Single Transaction – Amendments to IAS 12

(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 gains 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.

IFRS 17 was issued in May 2017 and it was amended in June 2020. 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) Disclosure Initiative - Accounting Policies – Amendments to IAS 1

The amendments improve accounting policy disclosures that to provide more useful information to investors and other primary users of the financial statements.

(E) Definition of Accounting Estimates – Amendments to IAS 8

The amendments introduce the definition of accounting estimates and included other amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors to help companies distinguish changes in accounting estimates from changes in accounting policies.

(F) Deferred Tax related to Assets and Liabilities arising from a Single Transaction – Amendments to IAS 12

The amendments narrow the scope of the recognition exemption in paragraphs 15 and 24 of IAS 12 so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences.

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 Group assesses all standards and interpretations have no material impact on the Group.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(1) Statement of compliance

The consolidated financial statements for the years ended December 31, 2021 and 2020 have been prepared in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, "Interim Financial Reporting," by the FSC of the Republic of China.

(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 presented in thousands of New Taiwan Dollars ("NT\$") unless otherwise specified.

(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.

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 NCIs even if this results in a deficit balance of the NCIs.

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) Recognizes any surplus or deficit in profit or loss; and
(f) Reclassifies the parent's share of components previously recognized in othercomprehensive income to profit or loss.

Percentage of Ownership (%),

The consolidated entities are listed as follows:

			As of December 31,
Investor	Subsidiary	Main business	2021	2020
The Company	KINSUS CORP. (USA)	Designing substrates, formulating marketing strategy analysis, developing new customers, researching and development new product technology	100.00%	100.00%
The Company	KINSUS HOLDING (SAMOA) LIMITED	Investing activities	100.00%	100.00%
The Company	KINSUS INVESTMENT CO., LTD.	Investing activities	100.00%	100.00%
KINSUS HOLDING (SAMOA) LIMITED	KINSUS HOLDING (CAYMAN) LIMITED	Investing activities	100.00%	100.00%
KINSUS HOLDING (SAMOA) LIMITED	PIOTEK HOLDINGS LTD. (CAYMAN)	Investing activities	51.00%	51.00%
KINSUS INVESTMENT CO., LTD.	PEGAVISION CORPORATION	Manufacture of medical equipment	30.33% (Note)	30.33% (Note)

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

KINSUS HOLDING (CAYMAN) LIMITED	KINSUS INTERCONNECT TECHNOLOGY SUZHOU CORP.	Manufacturing and selling printed circuit board (PCB) (not high density fine-line)	100.00%	100.00%
KINSUS HOLDING (CAYMAN) LIMITED	XIANG-SHOU (SUZHOU) TRADING LIMITED	Trading of PCB related products and materials (not high-density fine line)	100.00%	100.00%
PIOTEK HOLDINGS LTD. (CAYMAN)	PIOTEK HOLDING LIMITED	Investing activities	100.00%	100.00%
PIOTEK HOLDINGS LIMITED	PIOTEK COMPUTER (SUZHOU) CO., LTD.	Researching, developing, producing and selling electronic components, PCBs and related products and providing after-sale services	100.00%	100.00%
PIOTEK HOLDINGS LIMITED	PIOTEK (H.K.) TRADING LIMITED	Trading activities	100.00%	100.00%
PEGAVISION CORPORATION	PEGAVISION JAPAN INC.	Selling medical equipment	100.00%	100.00%
PEGAVISION CORPORATION	Pegavision (Jiangsu) Limited	Producing and Selling medical equipment	100.00% (Note 1)	Not applicable
PEGAVISION CORPORATION	PEGAVISION CONTACT LENSES (SHANGHAI) CORPORATION	Selling medical equipment	100.00%	100.00%
PEGAVISION CORPORATION	BeautyTech Platform Corporation	Selling medical equipment	-% (Note 2)	100.00%

PEGAVISION CORPORATION	Mayin Investment Co., Ltd.	Investing activities	100.00% (Note 2)	Not applicable
PEGAVISION CONTACT LENSES (SHANGHAI) CORPORATION	GEMVISION TECHNOLOGY (ZHEJIANG) LIMITED	Selling medical equipment	100.00%	100.00%
Mayin Investment Co., Ltd.	BeautyTech Platform Corporation	Selling medical equipment	100.00% (Note 2)	Not applicable
Mayin Investment Co., Ltd.	FacialBeau International Corporation	Selling cosmetic Products	55.00% (Note 2)	Not applicable
BeautyTech Platform Corporation	Aquamax Vision Corporation	Selling medical equipment	100.00%	100.00% (Note 3)

Note: The Group had 30.33% ownership of Pegavision Corporation as of December 31, 2021 and 2020. However the Group possesses control over the entity as it has been the single largest shareholder since the Group invested in Pegavision Corporation. The Group and the parent company hold more than 45% of voting right while the remaining equity is individually held by numerous shareholders without contractual rights. The Group therefore has control over the entity.
Note 1: The board of directors decided to set up Pegavision (Jiangsu) Limited which is 100% held by Pegavision Corporation at October 26, 2020. The registration was completed at March 15, 2021.
Note 2: To improve the synergy of the Group, the board of directors decided to reorganize and set up the Subsidiaries at July 26, 2021:
(a) The equity of BeautyTech Platform Corporation was transferred to Mayin Investment Co., Ltd. from Pegavision Corporation.
(b) Mayin Investment Co., Ltd. which is 100% held by Pegavision Corporation was registered at August 19, 2021.
(c) FacialBeau International Corporation which is 55% held by Mayin Investment Co., Ltd. was registered at October 22, 2021.
Note 3: The board of directors decided to set up Aquamax Vision Corporation which is 100% held by the BeautyTech Platform Corporation at February 10, 2020. The registration was completed at July 29, 2020.
(4) Foreign currency transactions

The Group's consolidated financial statements are presented in New Taiwan Dollar, which is the parent company's functional currency. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.

Transactions in foreign currencies are initially recorded by the Group entities at their respective functional currency rates prevailing at the date of the transaction. At the reporting date, monetary items denominated in foreign currencies are retranslated at the prevailing functional currency closing rate of exchange; non-monetary items measured at fair value in a foreign currency are retranslated using the exchange rates at the date when the fair value is determined; and non-monetary items measured at historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions.

All exchange differences arising from the settlement or translation of monetary items are taken to profit or loss in the period in which they arise, except for the following:

(a) Exchange differences arising from foreign currency borrowings for an acquisition of a qualifying asset to the extent that they are regarded as an adjustment to interest costs are included in the borrowing costs that are eligible for capitalization.
(b) Foreign currency items within the scope of IFRS 9 Financial Instruments are accounted for based on the accounting policy for financial instruments.
(c) Exchange differences arising on a monetary item that forms part of a reporting entity's net investment in a foreign operation is recognized initially in other comprehensive income and reclassified from equity to profit or loss on disposal of the net investment.

When a gain or loss on a non-monetary item is recognized in other comprehensive income, any exchange component of that gain or loss is recognized in other comprehensive income. When a gain or loss on a non-monetary item is recognized in profit or loss, any exchange component of that gain or loss is recognized in profit or loss.

(5) Foreign currency transactions and translation of financial statements in foreign currency

The assets and liabilities of foreign operations are translated into New Taiwan dollar at the closing rate of exchange prevailing at the balance sheet date and their income and expenses are translated at an average rate for the period. The exchange differences arising on the translation are recognized in other comprehensive income under exchange differences on translation of foreign operations. On disposal of the foreign operation, cumulative amount of the exchange differences recognized in other comprehensive income under separate component of equity is reclassified from equity to profit or loss when recognizing the disposal gain/loss.

On the partial disposal of a subsidiary that includes a foreign operation that does not result in a loss of control, the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income is re-attributed to the NCIs in that foreign operation, instead of recognized in profit or loss. In partial disposal of an associate or jointly controlled entity that includes a foreign operation that does not result in a loss of significant influence or joint control, only the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income is reclassified to profit or loss.

Any goodwill and fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and expressed in its functional currency.

(6) Current and non-current distinction for assets and liabilities

An asset is classified as current when:

(a) The Group expects to realize the asset, or intends to sell or consume it, in its normal operating cycle
(b) The Group holds the asset primarily for the purpose of trading
(c) The Group expects to realize the asset within twelve months after the reporting period

(d) The asset is cash or cash equivalent, unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is classified as current when:

(a) The Group expects to settle the liability in its normal operating cycle
(b) The Group holds the liability primarily for the purpose of trading
(c) The liability is due to be settled within twelve months after the reporting period
(d) The Group does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

All other liabilities are classified as non-current.

(7) Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, demand deposits and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value (including fixed-term deposits that have maturities equal to or less than three months from the date of acquisition).

(8) Financial instruments

Financial assets and financial liabilities are recognized when the Group becomes a party to the contractual provisions of the instrument.

Financial assets and financial liabilities within the scope of IFRS 9 Financial Instruments are recognized initially at fair value plus or minus, in the case of investments not at fair value through profit or loss, directly attributable transaction costs.

(a) Financial assets: Recognition and Measurement

The Group accounts for regular way purchase or sales of financial assets on the trade date.

The Group classified financial assets as subsequently measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss considering both factors below:

A. The Group's business model for managing the financial assets and
B. The contractual cash flow characteristics of the financial asset.

Financial assets measured at amortized cost

A financial asset is measured at amortized cost if both of the following conditions are met and presented as note receivables, trade receivables financial assets measured at amortized cost and other receivables etc., on balance sheet as at the reporting date:

A. The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and
B. The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Such financial assets are subsequently measured at amortized cost (the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount and the maturity amount and adjusted for any loss allowance) and is not part of a hedging relationship. A gain or loss is recognized in profit or loss when the financial asset is derecognized, through the amortization process or in order to recognize the impairment gains or losses.

Interest revenue is calculated by using the effective interest method. This is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for:

A. Purchased or originated credit-impaired financial assets. For those financial assets, the Group applies the credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.
B. Financial assets that are not purchased or originated credit-impaired financial assets but subsequently have become credit-impaired financial assets. For those financial

assets, the Group applies the effective interest rate to the amortized cost of the financial asset in subsequent reporting periods.

Financial asset measured at fair value through other comprehensive income

A financial asset is measured at fair value through other comprehensive income if both of the following conditions are met:

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

Recognition of gain or loss on a financial asset measured at fair value through other comprehensive income are described as below:

A. A gain or loss on a financial asset measured at fair value through other comprehensive income recognized in other comprehensive income, except for impairment gains or losses and foreign exchange gains and losses, until the financial asset is derecognized or reclassified.
B. When the financial asset is derecognized the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss as a reclassification adjustment.
C. Interest revenue is calculated by using the effective interest method. This is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for:
(i) Purchased or originated credit-impaired financial assets. For those financial assets, the Group applies the credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.
(ii) Financial assets that are not purchased or originated credit-impaired financial assets but subsequently have become credit-impaired financial assets. For those financial assets, the Group applies the effective interest rate to the amortized cost of the financial asset in subsequent reporting periods.

Besides, at initial recognition, the Group make an irrevocable election to present in other comprehensive income subsequent changes in the fair value of an investment in an equity instrument within the scope of IFRS 9 that is neither held for trading nor contingent consideration recognized by an acquirer in a business combination to which IFRS 3 applies. Amounts presented in other comprehensive income are not be subsequently transferred to profit or loss (when disposal of such equity instrument, its cumulated amount included in other components of equity is transferred directly to the retained earnings) and should recorded as financial assets measured at fair value through other comprehensive income on balance sheet. Dividends on such investment are recognized in profit or loss unless the dividends clearly represents a recovery of part of the cost of investment.

Financial asset measured at fair value through profit or loss

Financial assets were measured at amortized cost or measured at fair value through other comprehensive income only if they met particular conditions. All other financial assets were measured at fair value through profit or loss and presented on the balance sheet as financial assets measured at fair value through profit or loss.

Such financial assets are measured at fair value, the gains or losses resulting from remeasurement is recognized in profit or loss which includes any dividend or interest received on such financial assets.

(b) Impairment of financial assets

The Group is recognized a loss allowance for expected credit losses on debt instrument investments measured at fair value through other comprehensive income and financial asset measured at amortized cost. The loss allowance on debt instrument investments measured at fair value through other comprehensive income is recognized in other comprehensive income and not reduce the carrying amount in the statement of financial position.

The Group measures expected credit losses of a financial instrument in a way that reflects:

A. An unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes;

B. The time value of money; and
C. Reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions.

The loss allowance is measures as follows:

A. At an amount equal to 12-month expected credit losses: the credit risk on a financial asset has not increased significantly since initial recognition or the financial asset is determined to have low credit risk at the reporting date. In addition, the Group measures the loss allowance for a financial asset at an amount equal to lifetime expected credit losses in the previous reporting period, but determines at the current reporting date that condition is no longer met.
B. At an amount equal to the lifetime expected credit losses: the credit risk on a financial asset has increased significantly since initial recognition or financial asset that is purchased or originated credit-impaired financial asset.
C. For trade receivables or contract assets arising from transactions within the scope of IFRS 15, the Group measures the loss allowance at an amount equal to lifetime expected credit losses.
D. For lease receivables arising from transactions within the scope of IFRS 16, the Group measures the loss allowance at an amount equal to lifetime expected credit losses.

At each reporting date, the Group needs to assess whether the credit risk on a financial asset has been increased significantly since initial recognition by comparing the risk of a default occurring at the reporting date and the risk of default occurring at initial recognition. Please refer to Note 12 for further details on credit risk.

(c) Derecognition of financial assets
A financial asset is derecognized when:
A. The rights to receive cash flows from the asset have expired
B. The Group has transferred the asset and substantially all the risks and rewards of the asset have been transferred
C. The Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

On derecognition of a financial asset in its entirety, the difference between the carrying amount and the consideration received or receivable including any cumulative gain or loss that had been recognized in other comprehensive income, is recognized in profit or loss.

(d) Financial liabilities and equity

Classification between liabilities or equity

The Group classifies the instrument issued as a financial liability or an equity instrument in accordance with the substance of the contractual arrangement and the definitions of a financial liability, and an equity instrument.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. The transaction costs of an equity transaction are accounted for as a deduction from equity (net of any related income tax benefit) to the extent they are incremental costs directly attributable to the equity transaction that otherwise would have been avoided.

Financial liabilities

Financial liabilities within the scope of IFRS 9 Financial Instruments are classified as financial liabilities at fair value through profit or loss or financial liabilities measured at amortized cost upon initial recognition.

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated as at fair value through profit or loss. A financial liability is classified as held for trading if:

A. It is acquired or incurred principally for the purpose of selling or repurchasing it in the near term;
B. On initial recognition it is part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent actual pattern of short-term profit-taking; or
C. It is a derivative (except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument).

If a contract contains one or more embedded derivatives, the entire hybrid (combined) contract may be designated as a financial liability at fair value through profit or loss; or a financial liability may be designated as at fair value through profit or loss when doing so results in more relevant information, because either:

A. It eliminates or significantly reduces a measurement or recognition inconsistency; or
B. A group of financial liabilities or financial assets and financial liabilities is managed and its performance is evaluated on a fair value basis, in accordance with a documented risk management or investment strategy, and information about the group is provided internally on that basis to the key management personnel.

Gains or losses on the subsequent measurement of liabilities at fair value through profit or loss including interest paid are recognized in profit or loss.

Financial liabilities at amortized cost

Financial liabilities measured at amortized cost include interest bearing loans and borrowings that are subsequently measured using the effective interest rate method after initial recognition. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the effective interest rate method amortization process.

Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or transaction costs.

Derecognition of financial liabilities

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified (whether or not attributable to the financial difficulty of the debtor), such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

(e) Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount reported in the balance sheet if, and only if, there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the assets and settle the liabilities simultaneously.

(9) Fair value measurement

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 fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

(a) In the principal market for the asset or liability, or
(b) In the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible to by the Group.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

(10)Inventories

Inventories are valued at lower of cost or net realizable value item by item.

Costs incurred in bringing each inventory to its present location and conditions are accounted for as follows:

Raw materials - At actual purchase cost, using weighted average method Finished goods and work in progress - Including cost of direct materials and labor and a proportion of manufacturing overheads based on normal operating capacity, using weighted average method.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.

Rendering of services is accounted in accordance with IFRS 15 but not within the scoping of inventories.

(11)Investments accounted for using the equity method

The Group's investment in its associate is accounted for using the equity method other than those that meet the criteria to be classified as held for sale. An associate is an entity over which the Group has significant influence. A joint venture is a type of joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint venture.

Under the equity method, the investment in the associate or an investment in a joint venture is carried in the balance sheet at cost and adjusted thereafter for the post-acquisition change in the Group's share of net assets of the associate or joint venture. After the interest in the associate or joint venture is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate or joint venture. Unrealized gains and losses resulting from transactions between the Group and the associate or joint venture are eliminated to the extent of the Group's related interest in the associate or joint venture.

When changes in the net assets of an associate or a joint venture occur and not those that are recognized in profit or loss or other comprehensive income and do not affects the Group's percentage of ownership interests in the associate or joint venture, the Group recognizes such changes in equity based on its percentage of ownership interests. The resulting capital surplus recognized will be reclassified to profit or loss at the time of disposing the associate or joint venture on a prorata basis.

When the associate or joint venture issues new stock, and the Group's interest in an associate or a joint venture is reduced or increased as the Group fails to acquire shares newly issued in the associate or joint venture proportionately to its original ownership interest, the increase or decrease in the interest in the associate or joint venture is recognized in Additional Paid in Capital and Investment accounted for using the equity method. When the interest in the associate or joint venture is reduced, the cumulative amounts previously recognized in other comprehensive income are reclassified to profit or loss or other appropriate items. The aforementioned capital surplus recognized is reclassified to profit or loss on a pro rata basis when the Group disposes the associate or joint venture.

The financial statements of the associate or joint venture are prepared for the same reporting period as the Group. Where necessary, adjustments are made to bring the accounting policies in line with those of the Group.

The Group determines at each reporting date whether there is any objective evidence that the investment in the associate or an investment in a joint venture is impaired in accordance with IAS 28 Investments in Associates and Joint Ventures. If this is the case the Group calculates the amount of impairment as the difference between the recoverable amount of the associate or joint venture and its carrying value and recognizes the amount in the 'share of profit or loss of an associate' in the statement of comprehensive income in accordance with IAS 36 Impairment of Assets. In determining the value in use of the investment, the Group estimates:

(a) Its share of the present value of the estimated future cash flows expected to be generated by the associate or joint venture, including the cash flows from the operations of the associate and the proceeds on the ultimate disposal of the investment; or
(b) The present value of the estimated future cash flows expected to arise from dividends to be received from the investment and from its ultimate disposal.

Because goodwill that forms part of the carrying amount of an investment in an associate or an investment in a joint venture is not separately recognized, it is not tested for impairment separately by applying the requirements for impairment testing goodwill in IAS 36 Impairment of Assets.

Upon loss of significant influence over the associate or joint venture, the Group measures and recognizes any retaining investment at its fair value. Any difference between the carrying amount of the associate or joint venture upon loss of significant influence and the fair value of the retaining investment and proceeds from disposal is recognized in profit or loss. Furthermore, if an investment in an associate becomes an investment in a joint venture or an investment in a joint venture becomes an investment in an associate, the entity continues to apply the equity method and does not remeasure the retained interest.

(12)Property, plant and equipment

Property, plant and equipment are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of dismantling and removing the item and restoring the site on which it is located and borrowing costs for construction in progress if the recognition criteria are met. Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately. When significant parts of property, plant and equipment are required to be replaced in intervals, the Company recognized such parts as individual assets with specific useful lives and depreciation, respectively. The carrying amount of those parts that are replaced is derecognized in accordance with the derecognition provisions of IAS 16 "Property, plant and equipment". When a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in profit or loss as incurred.

Depreciation is calculated on a straight-line basis over the estimated economic lives of the following assets:

Buildings	10 to 25 years
Machinery	2 to 10 years
Vehicle	2 to 6 years
Office equipment	2 to 6 years
Other equipment	1 to 25 years

An item of property, plant and equipment or any significant part initially recognized is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset is recognized in profit or loss.

The property, plant and equipment's residual values, useful lives and methods of depreciation are reviewed at each financial year. If the expected values differ from the estimates, the differences are recorded as a change in accounting estimate.

(13)Leases

The Group assesses whether the contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset for a period of time, the Group assesses whether, throughout the period of use, has both of the following:

(a) the right to obtain substantially all of the economic benefits from use of the identified asset; and
(b) the right to direct the use of the identified asset.

For a contract that is, or contains, a lease, the Group accounts for each lease component within the contract as a lease separately from non-lease components of the contract. For a contract that contains a lease component and one or more additional lease or non-lease components, the Group allocates the consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease component and the aggregate standalone price of the non-lease components. The relative stand-alone price of lease and nonlease components shall be determined on the basis of the price the lessor, or a similar supplier, would charge the Group for that component, or a similar component, separately. If an observable stand-alone price is not readily available, the Group estimates the stand-alone price, maximising the use of observable information.

Group as a lessee

Except for leases that meet and elect short-term leases or leases of low-value assets, the Group recognizes right-of-use asset and lease liability for all leases which the Group is the lessee of those lease contracts.

At the commencement date, the Group measures the lease liability at the present value of the lease payments that are not paid at that date. The lease payments discount using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the Group uses it's incremental borrowing rate. At the commencement date, the lease payments included in the measurement of the lease liability comprise the following payments for the right to use the underlying asset during the lease term that are not paid at the commencement date:

(a) fixed payments (including in-substance fixed payments), less any lease incentives receivable;
(b) variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;
(c) amounts expected to be payable by the lessee under residual value guarantees;
(d) the exercise price of a purchase option if the Group is reasonably certain to exercise that option; and
(e) payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease.

After the commencement date, the Group measures the lease liability on an amortised cost basis, which is increasing the carrying amount to reflect interest on the lease liability by using an effective interest method; and reducing the carrying amount to reflect the lease payments made.

At the commencement date, the Group measures the right-of-use asset at cost. The cost of the right-of-use asset comprises:

(a) the amount of the initial measurement of the lease liability;
(b) any lease payments made at or before the commencement date, less any lease incentives received;
(c) any initial direct costs incurred by the lessee; and
(d) an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease.

For subsequent measurement of the right-of-use asset, the Group measures the right-of-use asset at cost less any accumulated depreciation and any accumulated impairment losses. That is, the Group measures the right-of-use applying a cost model.

If the lease transfers ownership of the underlying asset to the Group by the end of the lease term or if the cost of the right-of-use asset reflects that the Group will exercise a purchase option, the Group depreciates the right-of-use asset from the commencement date to the end of the useful life of the underlying asset. Otherwise, the Group depreciates the right-of-use asset from the commencement date to the earlier of the end of the useful life of the right-ofuse asset or the end of the lease term.

The Group applies IAS 36 "Impairment of Assets" to determine whether the right-of-use asset is impaired and to account for any impairment loss identified.

Except for leases that meet and elect short-term leases or leases of low-value assets, the Group presents right-of-use assets and lease liabilities in the balance sheet and separately presents lease-related interest expense and depreciation charge in the statements' comprehensive income.

For short-term leases or leases of low-value assets, the Group elects to recognize the lease payments associated with those leases as an expense on either a straight-line basis over the lease term or another systematic basis.

Group as a lessor

At inception of a contract, the Group classifies each of its leases as either an operating lease or a finance lease. A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership of an underlying asset. At the commencement date, the Group recognizes assets held under a finance lease in its balance sheet and present them as a receivable at an amount equal to the net investment in the lease.

For a contract that contains lease components and non-lease components, the Group allocates the consideration in the contract applying IFRS 15.

The Group recognizes lease payments from operating leases as rental income on either a straight-line basis or another systematic basis. Variable lease payments for operating leases that do not depend on an index or a rate are recognized as rental income when incurred.

(14)Intangible assets

Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is its fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses, if any. Internally generated intangible assets, not meeting the recognition criteria, are not capitalized and expenditure is reflected in profit or loss for the year in which the expenditure is incurred.

The useful lives of intangible assets are assessed as either finite or indefinite.

Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at the end of each financial year. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are accounted for by changing the amortization period or method, as appropriate, and are treated as changes in accounting estimates.

Intangible assets with indefinite useful lives are not amortized, but are tested for impairment annually, either individually or at the cash-generating unit (CGU) level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.

Gains or losses arising from derecognition of an intangible asset are recognized in profit or loss.

The Group's accounting policies for intangible assets are as follows:

	Cost of Computer Software
Useful economic life	1 to 5 years
Amortization method	Straight-line method during the contract term
Internally generated or acquired externally	Acquired externally

(15)Impairment of non-financial assets

The Group assesses at the end of each reporting period whether there is any indication that an asset in the scope of IAS 36 "Impairment of Assets" may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group would conduct impairment tests at individual or CGU level. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired. An asset's recoverable amount is the higher of an asset's net fair value or its value in use.

For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any indication that previously recognized impairment losses may no longer exist or may have decreased. If such indication exists, the Group estimates the recoverable amount of the asset or CGU. A previously recognized impairment loss is reversed only if there has been an increase in the estimated service potential of an asset which in turn increases the recoverable amount. However, the reversal is limited so that the carrying amount of the asset does not exceed the carrying amount that would have been determined, net of depreciation or amortization, had no impairment loss been recognized for the asset in prior years.

A cash generating unit, or groups of cash-generating units, to which goodwill has been allocated is tested for impairment annually at the same time, irrespective of whether there is any indication of impairment. If an impairment loss is to be recognized, it is first allocated to reduce the carrying amount of any goodwill allocated to the cash generating unit (group of units), then to the other assets of the unit (group of units) pro rata on the basis of the carrying amount of each asset in the unit (group of units). Impairment losses relating to goodwill cannot be reversed in future periods for any reason.

Impairment loss or reversals of continuing operations are recognized in profit or loss.

(16)Provisions

Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the Group expects some or all of a provision to be reimbursed, the reimbursement is recognized as a separate asset but only when the reimbursement is virtually certain. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

(17)Revenue recognition

The Group's revenue arising from contracts with customers mainly includes sale of goods and rendering of services. The accounting policies for the Group's types of revenue are explained as follow:

Sale of goods

The Group mainly manufactures and sells of its products. Sales are recognized when control of the goods is transferred to the customer and the goods are delivered to the customers. The main product of the Group is substrate and revenue is recognized based on the consideration stated in the contract. The remaining sales transactions are usually accompanied by volume discounts (based on the accumulated total sales amount for a specified period). Therefore, revenue from these sales is recognized based on the price specified in the contract, net of the estimated volume discounts. Accumulated experience is used to estimate and provide for the discounts, using the expected value method. Revenue is only recognized to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. During the period specified in the contract, refund liability is recognized for the products expected to be returned.

The credit period of the Group's sale of goods is from 30 to 90 days. For most of the contracts, when the Group transfers the goods to customers and has a right to an amount of consideration that is unconditional, these contracts are recognized as trade receivables. The period between the time when the Group transfers the goods to customers and when the customers pay for that goods is usually short and have no significant financing component to the contract. In the case that the Group has the right to transfer the goods to customers but does not has a right to an amount of consideration that is unconditional, these contacts should be presented as contract assets. Besides, in accordance with IFRS 9, the Group measures the loss allowance for a contract asset at an amount equal to the lifetime expected credit losses.

(18)Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective assets. All other borrowing costs are expensed in the period they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

(19)Government grants

Government grants are recognized where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. Where the grant relates to an asset, it is recognized as deferred income and released to income in equal amounts over the expected useful life of the related asset. When the grant relates to an expense item, it is recognized as income over the period necessary to match the grant on a systematic basis to the costs that it is intended to compensate.

Where the Group receives non-monetary grants, the asset and the grant are recorded gross at nominal amounts and released to the statement of comprehensive income over the expected useful life and pattern of consumption of the benefit of the underlying asset by equal annual installments. Where loans or similar assistance are provided by governments or related institutions with an interest rate below the current applicable market rate, the effect of this favorable interest is regarded as additional government grant.

(20)Post-employment benefits

All regular employees of Kinsus and its domestic subsidiaries are entitled to pension plans that are managed by an independently administered pension fund committee. Fund assets are deposited under the committee's name in the specific bank account and hence, not associated with Kinsus and its domestic subsidiaries. Therefore, fund assets are not included in the Group's consolidated financial statements. Pension benefits for employees of the overseas subsidiaries and the branches are provided in accordance with the respective local regulations.

For the defined contribution plan, Kinsus and its domestic subsidiaries will make a monthly contribution of no less than 6% of the monthly wages of the employees subject to the plan. The Company recognizes expenses for the defined contribution plan in the period in which the contribution becomes due. Overseas subsidiaries and branches make contribution to the plan based on the requirements of local regulations and the contribution is expensed as incurred.

Post-employment benefit plan that is classified as a defined benefit plan uses the Projected Unit Credit Method to measure its obligations and costs based on actuarial assumptions. Remeasurements, comprising of the effect of the actuarial gains and losses, the effect of the asset ceiling (excluding net interest) and the return on plan assets, excluding net interest, are recognized as other comprehensive income with a corresponding debit or credit to retained earnings in the period in which they occur. Past service costs are recognized in profit or loss on the earlier of:

(a) the date of the plan amendment or curtailment, and
(b) the date that the Company recognizes restructuring-related costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset, both as determined at the start of the annual reporting period, taking account of any changes in the net defined benefit liability (asset) during the period as a result of contribution and benefit payment.

(21)Share-based payment transactions

The cost of equity-settled transactions between the Group and its subsidiaries is recognized based on the fair value of the equity instruments granted. The fair value of the equity instruments is determined by using an appropriate pricing model.

The cost of equity-settled transactions is recognized, together with a corresponding increase in other capital reserves in equity, over the period in which the performance and/or service conditions are fulfilled. The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group's best estimate of the number of equity instruments that will ultimately vest. The income statement expense or credit for a period represents the movement in cumulative expense recognized as at the beginning and end of that period.

No expense is recognized for awards that do not ultimately vest, except for equity-settled transactions where vesting is conditional upon a market or non-vesting condition, which are treated as vesting irrespective of whether or not the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied.

Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified, if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee as measured at the date of modification.

Where an equity-settled award is cancelled, it is treated as if it vested on the date of cancellation, and any expense not yet recognized for the award is recognized immediately. This includes any award where non-vesting conditions within the control of either the entity or the employee are not met. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new awards are treated as if they were a modification of the original award, as described in the previous paragraph.

The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

The cost of restricted stocks issued is recognized as salary expense based on the fair value of the equity instruments on the grant date, together with a corresponding increase in other capital reserves in equity, over the vesting period. The Group recognized unearned employee salary which is a transitional contra equity account; the balance in the account will be recognized as salary expense over the passage of vesting period.

(22)Income tax

Income tax expense (benefit) is the aggregate amount included in the determination of profit or loss for the period in respect of current tax and deferred tax.

Current income tax

Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the end of reporting period. Current income tax relating to items recognized in other comprehensive income or directly in equity is recognized in other comprehensive income or equity and not in profit or loss.

The income tax for undistributed earnings of the Company and its subsidiaries is recognized as income tax expense in the subsequent year when the distribution proposal is approved by the Shareholders' meeting.

Deferred income tax

Deferred income tax is a temporary difference between the tax bases of assets and liabilities and their carrying amounts in balance sheet at the reporting date.

Deferred tax liabilities are recognized for all taxable temporary differences, except:

(a) Where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit (loss);
(b) In respect of taxable temporary differences associated with investments in subsidiaries, and associates and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognized for all deductible temporary differences, any unused tax losses and carry forward of unused tax credits to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized, except:

(a) Where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
(b) In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are recognized only to the extent that it is probable that the temporary differences will be reversed in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the reporting date. The measurement of deferred tax assets and liabilities reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Deferred tax relating to items recognized outside profit or loss is recognized outside profit or loss. Deferred tax items are recognized in correlation to the underlying transaction either in other comprehensive income or directly in equity. Deferred tax assets are reassessed and recognized at each reporting date.

Deferred tax assets and liabilities are offset, if a legally enforceable right exists to set off current income tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

5. SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of the Group's consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

(1) Judgement

In the process of applying the Company's accounting policies, management has made the following judgements, which have the most significant effect on the amounts recognized in the consolidated financial statements:

A. De facto control without a majority of the voting rights in subsidiaries

The Company does not have majority of the voting rights in certain subsidiaries. However, after taking into consideration factors such as absolute size of the Company's holding, relative size of the other shareholdings, how widely spread are the remaining shareholders, contractual arrangements between shareholders, potential voting rights, etc., the Company reached the conclusion that it has de facto control over these subsidiaries. Please refer to Note 4 for further details.

(2) Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that would have a significant risk for a material adjustment to the carrying amounts of assets and liabilities within the next fiscal year are discussed below.

A. Fair value of financial instruments

Where the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be derived from active markets, they are determined using valuation techniques including income approach (for example, the discounted cash flows model) or the market approach. Changes in assumptions about these factors could affect the reported fair value of the financial instruments. Please refer to Note 12 for more details.

B. Accounts receivables - estimation of impairment loss

The Group estimates the impairment loss of accounts receivables at an amount equal to lifetime expected credit losses. The credit loss is the present value of the difference between the contractual cash flows that are due under the contract (carrying amount) and the cash flows that expects to receive (evaluate forward looking information). However, as the impact from the discounting of short-term receivables is not material, the credit loss is measured by the undiscounted cash flows. Where the actual future cash flows are lower than expected, a material impairment loss may arise. Please refer to Note 6 for more details.

C. Inventory

Estimates of net realizable value of inventories take into consideration that inventories may be damaged, become wholly or partially obsolete, or their selling prices have declined. The estimates are based on the most reliable evidence available at the time the estimates are made. Please refer to Note 6 for more details.

D. Post-employment benefits

The cost of post-employment benefit pension plan and the present value of the defined benefit obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions, including the change in the discount rate and expected salary level.

E. Share-based payment transactions

The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. Estimating fair value for share-based payment transactions requires determining the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determining the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them. The assumptions and models used for estimating fair value for share-based payment transactions are disclosed in Note 6.

F. Revenue recognition - sale returns and allowances

The Group estimates sales returns and allowance based on historical experience and other known factors at the time of sale, which reduces the operating revenue. In assessing the aforementioned sales returns and allowance, on the basis of highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur. Please refer to Note 6 for more details.

G. Income tax

Uncertainties exist with respect to the interpretation of complex tax regulations and the amount and timing of future taxable income. Given the wide range of international business relationships and the long-term nature and complexity of existing contractual agreements, differences arising between the actual results and the assumptions made, or future changes to such assumptions, could necessitate future adjustments to tax income and expense already recorded. The Group establishes provisions, based on reasonable estimates, for possible consequences of audits by the tax authorities of the respective counties in which it operates. The amount of such provisions is based on various factors, such as experience of previous tax audits and differing interpretations of tax regulations by the taxable entity and the responsible tax authority. Such differences of interpretation may arise on a wide variety of issues depending on the conditions prevailing in the respective Group company's domicile.

Deferred tax assets are recognized for all carryforward of unused tax losses and unused tax credits and deductible temporary differences to the extent that it is probable that taxable profit will be available or there are sufficient taxable temporary differences against which the unused tax losses, unused tax credits or deductible temporary differences can be utilized. The amount of deferred tax assets determined to be recognized is based upon the likely timing and the level of future taxable profits and taxable temporary differences together with future tax planning strategies.

6. CONTENTS OF SIGNIFICANT ACCOUNTS

(1)Cash and cash equivalents

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Cash and petty cash	\$4,585	\$3,689
Checkings and savings	5,488,132	3,259,153
Time deposit	9,839,310	8,402,090
Total	\$15,332,027	\$11,664,932

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

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Mandatorily measured at fair value
through profit or loss:
Money market fund	\$591,278	\$1,546,518
Valuation adjustment	24,802	47,545
Total	\$616,080	\$1,594,063

Current	\$616,080	\$1,594,063
Non-current	\$-	\$-

No financial asset at fair value through profit or loss was pledged as collateral.

(3)Financial assets measured at amortized cost

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Time deposit	\$20,057	\$423,057
Restricted deposit	-	44,110
Total	\$20,057	\$467,167

Current	\$20,057	\$467,167
Non-current	\$-	\$-

The Group transacts with financial institutions with good credit rating. Consequently, there is no significant credit risk.

Please refer to Note 8 for more details on financial assets measured at amortized cost pledged as collaterals.

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

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Equity instruments investments measured
at fair value through other
comprehensive income – Non-current:
Unlisted company stocks	\$51,000	\$51,000

No financial assets at fair value through other comprehensive income was pledged by the Group as collateral.

(5)Notes receivable

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Notes receivable arising from operating activities	\$4,200	\$1,182
Less: loss allowance	-	-
Total	\$4,200	\$1,182

Notes receivable were not pledged.

The Group follows the requirement of IFRS9 to assess the impairment. Please refer to Note 6(22) for more details on loss allowance and Note 12 for details on credit risk.

(6)Accounts receivable and accounts receivable - related parties, net

A.Accounts receivable, net

As of December 31,
2021	2020
(NT\$'000)	(NT\$'000)
\$5,674,848	\$4,397,170
(26,844)	(20,015)
5,648,004	4,377,155
26,311	24,862
-	-
26,311	24,862
\$5,674,315	\$4,402,017

B.Accounts receivable were not pledged.
C.The Group entered into factoring agreements with banks. Accounts receivables from selected customers are transferred to banks without recourse. Details of the agreed credit limits and accounts receivables transferred were as follows:

		Accounts
		receivable		Advance
	Financial	de-recognized	Interest Rate	received		Credit
	Institution	(NT\$'000)		(NT\$'000)	Collateral	Limit
12/31/2021	Mega	\$602,015	0.47%~0.50%	\$244,368	None	Note
	International
	Commercial
	Bank - LanYa
	Branch

12/31/2020	Mega	\$480,175	0.42%~0.51%	\$479,599	None	Note
	International
	Commercial
	Bank - LanYa
	Branch

Note: The credit limits were US\$30,000 thousand as of December 31, 2021 and 2020.

D. Accounts receivable are generally on 30-90 day terms. The total carrying amount for the years ended December 31, 2021 and 2020, are NT\$5,701,159 and NT\$4,422,032, respectively. Please refer to Note 6 (22) for more details on loss allowance of accounts receivable for the years ended December 31, 2021 and 2020. Please refer to Note 12 for more details on credit risk management.

(7)Inventories

A. Details of inventory:

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Raw material	\$771,833	\$708,425
Supplies	70,474	67,033
Work in process	1,904,882	1,408,262
Finished goods	648,488	647,654
Merchandises	70,267	57,643
Total	\$3,465,944	\$2,889,017

B. For the years ended December 31, 2021 and 2020, the Group recognized NT\$25,146,918 thousand and NT\$21,279,420 thousand under the caption of costs of sale, respectively. The following items were also included in cost.

	For the year ended December 31,
	2021	2020
Item	(NT\$'000)	(NT\$'000)
Loss from inventory market decline	\$268,901	\$98,577
Loss from physical	29,113	15,694
Loss from inventory write-off obsolescence	3,217,396	2,624,537
Total	\$3,515,410	\$2,738,808

C. The inventories were not pledged.

(8) Investments accounted for under the equity method

	As of December 31,
		2021	2020
	Carrying	Percentage of	Carrying	Percentage of
	amount	ownership	amount	ownership
Investee	(NT\$'000)	(%)	(NT\$'000)	(%)
Investment in associates:
FuYang Technology Corp.	\$325,005	35.65%	\$298,789	35.65%

A. The Company invested cash in FuYang Technology Corp. during May 2016 for interest ownership of 36%. The investment is accounted for as an investment in associates due to the Company's ability to exercise its significant influence.

In May 2017, the Company participated in FuYang's cash offering by disproportionately investing NT\$479,422 thousand for 19,176,872 shares of FuYang and, therefore, recognized a capital surplus amounting to NT\$7,484 thousand. As a result of the offering, the Company's share interest on FuYang decreased to 35.65%.

B. Investments in associates

As of December 31, 2021 and 2020, the aggregate carrying amount of the Group's interests in FuYang Technology Corp. is NT\$325,005 thousand and NT\$298,789 thousand. The aggregate financial information based on Group's share of FuYang Technology Corp. is as follows:

	For the year ended December 31,
	2021 2020
	(NT\$'000)	(NT\$'000)
Profit or loss from continuing operations	\$27,839	\$(233,581)
Other comprehensive income (post-tax)	(1,623)	(5,889)
Total comprehensive income	\$26,216	\$(239,470)

There were no contingent liabilities or capital commitments with respect to the investment in the associate as of December 31, 2021 and 2020. Nor any of the Group's share interest on FuYang was pledged as collateral.

C. The Group's investment accounted for under equity method as of December 31, 2021 and 2020 amounted to NT\$325,005 thousand and NT\$298,789 thousand while the related investment income/loss and joint venture income were NT\$27,839 thousand and NT\$(233,581) thousand for the year ended December 31, 2021 and 2020, respectively. And other comprehensive income were NT\$(1,623) thousand and NT\$(5,889) thousand for the year ended December 31, 2021 and 2020, respectively. They were measured based on the audited financial statements of the investee for the same correspondent periods.
D. No investment accounted for under equity method was pledged as collateral as of December 31, 2021 and 2020.
(9) Property, plant and equipment

		As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Owner occupied property, plant and equipment	\$24,413,455	\$18,080,810

A.Property, plant and equipment

							Construction in progress
							and equipment awaiting
				Office		Other	inspection (including
	Land	Buildings	Machinery	Equipment	Vehicle	Equipment	prepayment for equipment)	Total
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Cost:
As of 1/1/2021	\$2,979,392	\$8,639,244	\$26,982,667	\$259,713	\$20,043	\$7,684,122	\$2,597,912	\$49,163,093
Addition	(1,563)	(631)	6,260	983	-	188,604	14,993,459	15,187,112
Disposals	-	-	(597,025)	(2,065)	-	(277,206)	-	(876,296)
Effect of EX rate	-	(51,887)	(122,179)	(805)	(67)	(17,642)	(963)	(193,543)
Reclassification	3,132,634	1,492,884	4,425,950	19,349	3,325	505,153	(9,579,295)	-
As of 12/31/2021	\$6,110,463	\$10,079,610	\$30,695,673	\$277,175	\$23,301	\$8,083,031	\$8,011,113	\$63,280,366

As of 1/1/2020	\$2,979,392	\$8,703,739	\$25,976,638	\$241,294	\$17,922	\$7,348,928	\$1,745,970	\$47,013,883
Addition	-	40	2,851	73	42	192,852	3,286,975	3,482,833
Disposals	-	(1,595)	(813,220)	(7,489)	(596)	(270,227)	-	(1,093,127)
Effect of EX rate	-	(73,162)	(160,467)	(117)	159	(7,269)	360	(240,496)

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese
Kinsus Interconnect Technology Corp.
Notes to Consolidated Financial Statements (Continued)

Reclassification	-	10,222	1,976,865	25,952	2,516	419,838	(2,435,393)	-
As of 12/31/2020	\$2,979,392	\$8,639,244	\$26,982,667	\$259,713	\$20,043	\$7,684,122	\$2,597,912	\$49,163,093

Depreciation and impairment:
As of 1/1/2021	\$-	\$3,085,988	\$20,478,512	\$211,312	\$15,629	\$5,094,500	\$-	\$28,885,941
Depreciation	-	438,424	2,890,297	28,026	1,874	912,861	-	4,271,482
Impairment loss	-	15,200	16,717	-	-	868	-	32,785
Disposal	-	-	(561,608)	(2,065)	-	(271,283)	-	(834,956)
Effect of EX rate	-	(28,900)	(114,476)	(705)	(54)	(15,219)	-	(159,354)
Reclassification	-	-	(1)	-	-	1	-	-
As of 12/31/2021	\$-	\$3,510,712	\$22,709,441	\$236,568	\$17,449	\$5,721,728	\$-	\$32,195,898

As of 1/1/2020	\$-	\$2,757,524	\$18,364,210	\$190,436	\$14,447	\$4,427,400	\$-	\$25,754,017
Depreciation	-	372,314	2,912,340	28,345	1,626	942,101	-	4,256,726
Impairment loss	-	-	19,305	-	-	322	-	19,627
Disposal	-	(1,594)	(662,474)	(7,489)	(596)	(270,185)	-	(942,338)
Effect of EX rate	-	(42,256)	(154,866)	20	152	(5,141)	-	(202,091)
Reclassification	-	-	(3)	-	-	3	-	-
As of 12/31/2020	\$-	\$3,085,988	\$20,478,512	\$211,312	\$15,629	\$5,094,500	\$-	\$28,885,941

Net carrying amount:
As of 12/31/2021	\$6,110,463	\$6,568,898	\$7,986,232	\$40,607	\$5,852	\$2,361,303	\$8,011,113	\$31,084,468
As of 12/31/2020	\$2,979,392	\$5,553,256	\$6,504,155	\$48,401	\$4,414	\$2,589,622	\$2,597,912	\$20,277,152

B."Significant components"of buildings primarily comprised the main buildings and the facilities, which are depreciated based on their respective useful economic life of 20 to 25 years and 3 to 20 years.
C. Details of property, plant & equipment and prepayment for machinery is as follows:

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Property, plant and equipment	\$24,413,455	\$18,080,810
Prepayment for equipment	6,671,013	2,196,342
Total	\$31,084,468	\$20,277,152

D. The Group recognized an impairment loss amounting to NT\$32,785 thousand on certain real estate to an extent of the recoverable value in 2021. The Group recognized an impairment loss amounting to NT\$19,627 thousand on certain real estate to an extent of the recoverable value in 2020. These impairment loss or gain from recovery has been recorded in the Group's statements of comprehensive incomes. The recoverable value is measured at usage values by the identified individual asset.
E. Please refer to Note 8 for details on property, plant and equipment pledged as collaterals.
F. The Company purchased 40 parcels of land with a total area of 36,115.24 square meters. Lands are located at the addresses of No. 1113, 1114, 1438 to 1443,1479,1486 to 1487 at ShiLeiZi Sub-section, ShiLeiZi Section, No. 1044, 1047 to 1049 at QingHua Section, and No. 0001, 697 to 700 and 712 to 726 at RongHua Section, XinFeng Village. Due to regulatory restrictions, the agricultural land cannot be registered under the Company's name while it has been temporarily registered under the general manager's name and, to secure the Company's right to the land, mortgage registration has been set aside with the Company being the obligee.
(10)Intangible assets

	Computer software
	(NT\$'000)
Cost:
As of 1/1/2021	\$64,197
Additions – acquired separately	47,652
Derecognized upon retirement	(38,272)
Reclassification	-
Effect of exchange rate changes	(124)
As of 12/31/2021	\$73,453

As of 1/1/2020	\$82,532
Additions – acquired separately	41,024
Derecognized upon retirement	(58,789)
Reclassification	-
Effect of exchange rate changes	(570)
As of 12/31/2020	\$64,197

Amortization and Impairment:
As of 1/1/2021	\$32,092
Amortization	46,518
Derecognized upon retirement	(38,272)
Reclassification	-
Effect of exchange rate changes	(103)
As of 12/31/2021	\$40,235

As of 1/1/2020	\$51,779
Amortization	39,654
Derecognized upon retirement	(58,789)
Reclassification	-
Effect of exchange rate changes	(552)
As of 12/31/2020	\$32,092

Carrying amount, net:
As of 12/31/2021	\$33,218
As of 12/31/2020	\$32,105

Amounts of amortization recognized for intangible assets are as follows:

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Cost of goods sold	\$245	\$108
Selling	771	88
General and administrative	44,628	38,850
Research and development	874	608
Total	\$46,518	\$39,654

(11)Other non-current assets

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Refundable deposits	\$91,805	\$120,921

(12)Short-term loans

			As of December 31,
	Interest interval	2021	2020
	(%)	(NT\$'000)	(NT\$'000)
Unsecured bank loans	0.50%~1.2983%	\$1,099,846	\$2,640,307

As of December 31, 2021 and 2020, the line of unused short-term loan credit for the Group amounted to NT\$7,803,953 thousand and NT\$5,614,413 thousand.

(13)Other payable

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Accrued expense	\$4,229,993	\$2,733,032
Equipment payable	3,000,907	1,197,505
Accrued interest	3,372	2,672
Total	\$7,234,272	\$3,933,209

(14)Other current liabilities

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Other current liabilities	\$189,715	\$104,488
Current portion of long-term loans	690,838	967,737
Fund collected for purchase of
equipment on behalf of others (Note)	742,562	-
Deferred revenue	11,028	4,444
Total	\$1,634,143	\$1,076,669

Note: It refers fund collected for purchase equipment on behalf of customer who commissioned the Company to acquire equipment for it.

(15)Refund liability

		As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Refund liability	\$181,108	\$206,517

(16)Long-term loans

Details of long-term loans were as follows:

			Loan Balance
			As of 12/31/2021
Debtor	Type of Loan	Maturity	(NT\$'000)	Repayment
Mega International	Credit loan	2026.12.31-	\$5,257,804	Notes 1, 2, 5, 10, 11 and 15
Commercial Bank		2036.06.28
– LanYa Branch
Mega International	Secured loan	2026.09.15	4,922	Note 16
Commercial Bank
– LanYa Branch
The Shanghai	Credit loan	2025.12.18-	2,267,055	Notes 3, 7, 8, 12 and 19
Commercial &		2028.11.15
Savings Bank
– ZhongLi Branch
The Shanghai	Secured loan	2030.10.15	49,079	Note 17
Commercial &
Savings Bank
– ZhongLi Branch
Chang Hwa	Credit loan	2025.03.15-	548,912	Notes 5 and 18
Commercial Bank		2027.08.15
– BeiTou Branch
The Bank of Taiwan	Credit loan	2026.11.04-	1,950,339	Notes 4, 6 and 9
– BeiTou Branch		2026.12.31
Total			10,078,111
Less: current portion			(690,838)
Non-current portion			\$9,387,273

			Loan Balance As of 12/31/2020
Debtor	Type of Loan	Maturity	(NT\$'000)	Repayment
Mega International	Credit loan	2021.09.05-	\$584,975	Notes 5 and 12
Commercial Bank		2026.12.31
– LanYa Branch
The Shanghai	Credit loan	2021.04.23-	1,617,293	Notes 3, 13 and 19
Commercial &		2027.09.15
Savings Bank
– ZhongLi
Branch
The Shanghai	Secured loan	2020.11.10-	9,786	Note 17
Commercial &		2030.10.15
Savings Bank
– ZhongLi
Branch
Standard Chartered	Credit loan	2021.09.28	300,000	Note 14
Bank – Xinwu
Branch
Chang Hwa	Credit loan	2025.03.15-	152,815	Notes 5 and 18
Commercial Bank		2027.08.15
– BeiTou Branch
The Bank of Taiwan	Credit loan	2026.11.04-	944,679	Note 6
– BeiTou Branch		2027.09.30
Total			3,609,548
Less: current portion			(967,737)
Non-current portion			\$2,641,811

Notes to Consolidated Financial Statements (Continued)

Note 1: A term is defined as every month starting from the initial draw-down date. Grace period is 13 months. Interest shall be paid monthly with principal repaid every month. The rest is repayable in installments of equal amount for 48 terms.
Note 2: Grace period is 3 years from the initial draw-down date. A term is defined as every month since the forth year. The principal and interest are repayable in installments of equal amount for 48 terms.
Note 3: A term is defined as every month starting from the initial draw-down date. The principal and interest are repayable in installments of equal amount for 84 terms.
Note 4: The principal and interest are repayable in installments of equal amount for 59 terms.
Note 5: Grace period is 3 years from the initial draw-down date. A term is defined as every month since the forth year. The principal and interest are repayable in installments of equal amount for 48 terms.
Note 6: Grace period is 2 years from the initial draw-down date. A term is defined as every month since the third year. The principal and interest are repayable in installments of equal amount for 60 terms.
Note 7: Loan period is 7 years. Grace period is 2 year. Interest shall be paid monthly with principal repaid every months (84 terms). The rest is repayable in installments of equal amount for 60 terms.
Note 8: Loan period is 7 years. Grace period is 2 year. Interest shall be paid monthly with principal repaid every 3 months (84 terms). The rest is repayable in installments of equal amount for 20 terms.
Note 9: A term is defined as every month starting from the initial draw-down date. Grace period is 11 months. Interest shall be paid monthly with principal repaid every month. The rest is repayable in installments of equal amount for 60 terms.
Note 10: A term is defined as every month starting from the initial draw-down date. Grace period is 21 months. Interest shall be paid monthly with principal repaid every month. The rest is repayable in installments of equal amount for 48 terms.
Note 11: A term is defined as every month starting from the initial draw-down date. Grace period is 22 months. Interest shall be paid monthly with principal repaid every month. The rest is repayable in installments of equal amount for 48 terms.
Note 12: A term is defined as every 3 months starting from the initial draw-down date. Loan period is 5 years. Grace period is 5 year. Interest shall be paid monthly with principal repaid every 3 months. The rest is repayable in installments of equal amount for 16 terms.
Note 13: A term is defined as every 3 months starting from the initial draw-down date. Loan period is 3 years. Grace period is 1 year. The rest is repayable in installments of equal amount for 8 terms.
Note 14: Grace period is 18 months from the initial draw-down date. 18 months after the initial draw-down date is considered the 1st term and the following terms are defined as every 6 months since then. The principal and interest are repayable in installments of equal amount for 4 terms.
Note 15: Grace period is 3 years from the initial draw-down date. A term is defined as every 3 months since the forth year. The principal and interest are repayable in installments of equal amount for 16 terms.
Note 16: Grace period is 2 years from the initial draw-down date. A term is defined as every month since the third year. The principal and interest are repayable in installments of equal amount for 36 terms.
Note 17: A term is defined as every month starting from the initial draw-down date. Grace period is 2 years (24 terms). The rest is repayable in installments of equal amount for 96 terms.
Note 18: A term is defined as every month starting from the initial draw-down date. Grace period is 3 years (36 terms). The rest is repayable in installments of equal amount for 24 terms.
Note 19: A term is defined as every 3 months starting from the initial draw-down date. The principal and interest are repayable in installments of equal amount for 16 terms.
A. Please refer to Note 8 for details on assets pledged as collaterals.
B. As of December 31, 2021 and 2020, the interest rate intervals for long-term loans were 0.4%~1.2136% and 0.4%~1.236%.

The Group obtained from the Ministry of Economy a low-interest government loan amounting NT\$5,720,000 thousands with a term of 5~10 years and annual interest rates of 0.5~0.9% and monthly interest payment on the 15th of each month. The loan was recorded under the caption of other liabilities-deferred government grants income. The Group shall recognize the government grant income when it is reasonably assured that the Group satisfy all the terms of the government grant agreement.

(17)Other non-current liabilities
(a) Details of other non-current liabilities were as follows:

		As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Net defined benefit liability	\$16,259	\$30,366
Deposits received	1,820,407	73,235
Deferred revenue	55,289	26,068
Total	\$1,891,955	\$129,669

(b) The details of the deferred government grants income for the year ended December 31, 2021 and 2020 are as follows:

	For the year ended	For the year ended
	December 31, 2021	December 31, 2020
	(NT\$'000)	(NT\$'000)
Beginning balance	\$30,512	\$-
Received during the period	44,262	33,970
Released to the statement of comprehensive income	(8,457)	(3,458)
Ending Balance	\$66,317	\$30,512
Current	\$11,028	\$4,444
Non-current	\$55,289	\$26,068

(18)Post-employment benefits

Defined contribution plan

The Company and its domestic subsidiaries adopt a defined contribution plan in accordance with the Labor Pension Act of the R.O.C. Under the Labor Pension Act, the Company and its domestic subsidiaries will make monthly contributions of no less than 6% of the employees' monthly wages to the employees' individual pension accounts. The Company and its domestic subsidiaries have made monthly contributions of 6% of each individual employee's salaries or wages to employees' pension accounts.

Subsidiaries located in the People's Republic of China will contribute social welfare benefits based on a certain percentage of employees' salaries or wages to the employees' individual pension accounts.

Pension benefits for employees of overseas subsidiaries and branches are provided in accordance with the local regulations.

Expenses under the defined contribution plan for the years ended December 31, 2021 and 2020 were NT\$180,726 thousand and NT\$157,242 thousand, respectively.

Pension expenses for the years ended December 31, 2021 and 2020 were NT\$9 thousand and NT\$16 thousand, respectively.

Defined benefits plan

Kinsus and its domestic subsidiaries adopt a defined benefit plan in accordance with the Labor Standards Act of the R.O.C. The pension benefits are disbursed based on the units of service years and the average salaries in the last month of the service year. Two units per year are awarded for the first 15 years of services while one unit per year is awarded after the completion of the 15th year. The total units shall not exceed 45 units. Under the Labor Standards Act, Kinsus and its domestic subsidiaries contribute an amount equivalent to 2% of the employees' total salaries and wages on a monthly basis to the pension fund deposited at the Bank of Taiwan in the name of the administered pension fund committee.

The Ministry of Labor is in charge of establishing and implementing the fund utilization plan in accordance with the Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund. The pension fund is invested in-house or under mandate, based on a passive-aggressive investment strategy for long-term profitability. The Ministry of Labor establishes checks and risk management mechanism based on the assessment of risk factors including market risk, credit risk and liquidity risk, in order to maintain adequate manager flexibility to achieve targeted return without over-exposure of risk. With regard to utilization of the pension fund, the minimum earnings in the annual distributions on the final financial statement shall not be less than the earnings attainable from the amounts accrued from twoyear time deposits with the interest rates offered by local banks. Treasury Funds can be used to cover the deficits after the approval of the competent authority. As the Company does not participate in the operation and management of the pension fund, no disclosure on the fair value of the plan assets categorized in different classes could be made in accordance with paragraph 142 of IAS 19. The Group expects to contribute NT\$4,480 thousand to its defined benefit plan during the 12 months beginning after December 31, 2021.

As of December 31, 2021 and 2020, the maturities of Kinsus' defined benefit plan are in 2037 and 2037.

Pension costs recognized in profit or loss were as follows.

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Current period service costs	\$-	\$-
Net interest of defined benefit liability (asset)	130	224
Previous period service costs	-	-
Settlement	-	-
Total	\$130	\$224

Reconciliation of liability (asset) of the defined benefit plan is as follows:

	As of
12/31/2021	12/31/2020	01/01/2020
(NT\$'000)	(NT\$'000)	(NT\$'000)
\$152,441	\$159,753	\$145,786
(136,182)	(129,387)	(120,015)

\$16,259	\$30,366	\$25,771

Reconciliation of liability (asset) of the defined benefit liability is as follows:

	Present value of		Net defined
	defined benefit	Fair value of	benefit
	obligation	plan assets	liability(asset)
	(NT\$'000)	(NT\$'000)	(NT\$'000)
1/1/2020	\$145,786	\$(120,015)	\$25,771
Current service cost	-	-	-
Interest cost	1,268	(1,044)	224
Past service cost and settlement	-	-	-
Total	1,268	(1,044)	224
Re-measurement on defined benefit
liability/assets:
Actuarial gain/loss due to change in
population statistic assumptions	(2,013)	-	(2,013)

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp.

Notes to Consolidated Financial Statements (Continued)

Actuarial gain/loss due to change in financial
assumptions	11,971	-	11,971
Experience gain/loss	2,741	(3,864)	(1,123)
Re-measurement on defined benefit assets	-	-	-
Total	12,699	(3,864)	8,835
Benefits paid	-	-	-
Contributions by employer	-	(4,464)	(4,464)
Effect of exchange rate	-	-	-
12/31/2020	159,753	(129,387)	30,366
Current service cost	-	-	-
Interest cost(revenue)	687	(557)	130
Pasts service cost and settlement	-	-	-
Total	687	(557)	130
Re-measurement on defined benefit
liability/assets:
Actuarial gain/loss due to change in
population statistic assumptions	1,350	-	1,350
Actuarial gain/loss due to change in financial
assumptions	(10,410)	-	(10,410)
Experience gain/loss	1,061	(1,758)	(697)
Re-measurement on defined benefit assets	-	-	-
Total	(7,999)	(1,758)	(9,757)
Benefits paid	-	-	-
Contributions by employer	-	(4,480)	(4,480)
Effect of exchange rate	-	-	-
12/31/2021	\$152,441	\$(136,182)	\$16,259

The actuarial assumptions used for the Company's defined benefit plan are shown below.

	As of December 31,
	2021	2020
Discount rate	0.82%	0.43%
Expected rate of salary increases	3.00%	3.00%

Sensitivity analysis

	For the year ended December 31,
		2021		2020
	(NT\$'000) (NT\$'000)
	Increase	Decrease	Increase	Decrease
	in defined	in defined	in defined	in defined
	benefit	benefit	benefit	benefit
	obligation	obligation	obligation	obligation
Discount rate increased by 0.5%	\$-	\$(12,327)	\$-	\$(13,353)
Discount rate decreased by 0.5%	13,613	-	14,825	-
Expected salary level increased by 0.5%	13,243	-	14,363	-
Expected salary level decreased by 0.5%	-	(12,135)	-	(13,097)

For the purpose of sensitivity analysis above, the Company calculated the impact on defined benefit obligation due to a reasonable and feasible change of one single assumption (i.e. discount rate or expected salary level) with other assumptions remaining equal. Please note that the sensitivity analysis has its limitation due to the co-relation between different actuarial assumptions and the rarity that only one assumption changes at a time.

The method used in the analysis is consistent for both current and prior years.

(19)Equity

A. Common stock

As of December 31, 2021 and 2020, the Company's authorized capital were NT\$6,000,000 thousand and NT\$6,000,000 thousand, respectively, each share at par value of NT\$10, divided into 600,000 thousand shares and 600,000 thousand shares, respectively. As of December 31, 2021 and 2020, the Company's paid-in capital were NT\$4,508,441 thousand and NT\$4,508,625 thousand, respectively, divided into 450,844 thousand shares and 450,863 thousand shares, respectively. Each share represents a voting right and a right to receive dividends.

On January 29, 2018 and May 29, 2018, the Company's board of directors and shareholders' meetings resolved to increase the capital through an issuance of new 5,500,000 shares of restricted stock for employees. The application has been governmentally approved by FSC in the Order No. Financial-Supervisory-Securities-Corporate-1070324628 issued on July 10, 2018. The measurement date was at August 28, 2018, and issued 4,841,000 shares of restricted stock for employees.

In addition, on February 18, 2019, the board of directors resolved to issue 659,000 shares of restricted stock. The measurement date was at March 18, 2019 and issued 598,500 shares of restricted stock.

On February 18, 2019, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$786 thousand. The measurement date was at March 17, 2019.

On April 29, 2019, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$600 thousand. The measurement date was at May 2, 2019.

On July 29, 2019, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$1,395 thousand. The measurement date was at August 1, 2019.

On October 28, 2019, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$876 thousand. The measurement date was at October 30, 2019.

On February 10, 2020, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$348 thousand. The measurement date was at February 12, 2020.

On April 27, 2020, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$1,238 thousand. The measurement date was at April 29, 2020.

On July 27, 2020, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$399 thousand. The measurement date was at July 29, 2020.

On October 26, 2020, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$128 thousand. The measurement date was at October 28, 2020.

On January 29, 2021, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$151 thousand. The measurement date was at February 1, 2021.

On April 26, 2021, the board of directors resolved to cancel restricted stock, and the amount of the capital reduction is NT\$33 thousand. The measurement date was at April 28, 2021.

B. Capital surplus

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Additional paid-in capital	\$6,036,311	\$6,011,409
Differences between purchase price and carrying
amount arising from acquisition or disposal of
subsidiaries	50,925	50,925
All changes in interests in subsidiaries	529,959	529,959
Change in joint ventures accounted for using
equity method	7,484	7,484
Changes in equity of investment accounted for
using equity method	1	-
Shared-Based Payment	8,371	8,371
Restricted stocks for employees	-	23,882
Total	\$6,633,051	\$6,632,030

According to the Taiwan Company Act, the capital surplus shall not be used except for making good the deficit of the Company. When a company incurs no loss, it may distribute the capital surplus related to the income derived from the issuance of new shares at a premium or income from endowments received by the company up to a certain percentage of paid-in capital. The said capital surplus could be distributed in cash to its shareholders in proportion to the number of shares being held by each of them. Capital surplus related to long-term equity investments cannot be used for any purpose.

C. Treasury stock

Treasury stock amounted to NT\$0 and NT\$143 thousand, respectively, divided into 0 shares, and 14 thousand shares, respectively, as of December 31, 2021 and 2020.

The movement schedule of treasury stock for the years ended December 31, 2021 and 2020 was as below (in thousand shares).

Beginning
Purpose of repurchase	balance	Addition	Decrease	balance
For the years ended December 31, 2021
Recover failed restricted stocks	14	4	18	0

For the years ended December 31, 2020
Recover failed restricted stocks	33	192	211	14

According to the Securities and Exchange Act of the R.O.C., total treasury stock shall not exceed 10% of the Company's issued stock, and the total purchase amount shall not exceed the sum of the retained earnings, additional paid-in capital-premiums and realized additional paid-in capital. As such, the ceiling number of shares of treasury stock that the Company could hold as of December 31, 2021 were 45,084 thousand shares, with the maximum payments of NT\$23,986,242 thousand.

In compliance with Securities and Exchange Act of the R.O.C., treasury stock should not be pledged, nor should it be entitled to voting rights or receiving dividends.

D. Appropriation of earnings and dividend policies
(a)Earning distribution

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

a. Payment of all taxes and dues;
b. Offset prior years' operation losses;
c. Set aside 10% of the remaining amount as legal reserve.
d. Set aside or reverse special reserve in accordance with law and regulations; and

e. The distribution of the remaining portion, if any, will be recommended by the Board of Directors and resolved in the shareholders' meeting.

If the above-mentioned dividends are distributed to shareholders in the form of cash, the Board of Directors have been authorized to approve 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, and report to the shareholders' meeting.

(b)Dividend policies

The Company is in an industry with versatile environment. For long-term finance planning requirements and to meet the shareholders' demand for cash, the Company's dividend policy aims for steadiness and balancing. Shareholder extra dividend each year cannot be less than 10% of distributed surplus earnings and cash dividends distributed each year cannot be less than 10% of the gross amount of dividends.

(c)Legal reserve

According to the Company Act, legal reserve shall be set aside until such amount equal total authorized capital. Legal reserve can be used to offset deficits. If the Company does not incur any loss, the portion of legal reserve exceeding 25% of the paid-in capital may be distributed to shareholders by issuing new shares or by cash in proportion to the number of shares held by each shareholder.

(d)Special reserve

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.

The FSC issued Order No. Financial-Supervisory-Securities-Corporate-1090150022 on March 31, 2021, 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 proportion and transfer to retained earnings.

The Company did not incur any special reserve upon the first-time adoption of T-IFRS.

(e)The appropriations of earnings for the Year 2021 and 2020 were approved through the Board of Directors' meetings and shareholders' meetings held on February 15, 2022 and July 12, 2021, respectively. The details of the distributions are as follows:

			Dividend per share
	Appropriation of earnings	(in NT\$)
	2021	2020
	(NT\$'000)	(NT\$'000)	2021	2020
Legal reserve	\$386,880	\$53,316
Special reserve	22,092	(2,389)
Cash dividend	2,028,798	450,847	\$4.50	\$1.00
Total	\$2,437,770	\$501,774

Please refer to Note 6(24) for details on employees' compensation and remuneration to directors and supervisors.

E. Non-controlling interests

	For the years ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Beginning balance	\$3,519,907	\$3,270,679
Net income attributable to NCIs	633,124	387,529
Other comprehensive income attributable to
NCIs:
Exchange differences arising on translation	(11,934)	(16,385)
of foreign operations
Non-controlling interests increase/(decrease)	(221,331)	(121,916)
Ending balance	\$3,919,766	\$3,519,907

(20)Share-based payment plans

Restricted stocks plan for employees

A.On May 29, 2018, the shareholders' meetings resolved to issue of 5,500 thousand shares of restricted stocks for employees. The grantee is limited to employees who meet certain conditions. The restricted stocks have been approved by the Securities and Futures Bureau. On July 30, 2018, the board of directors resolved to issue 4,947 thousand shares. The measurement date was at August 28, 2018 and total shares issued were 4,841 thousand. The unit market price as of the granted date was NT\$49.1.

On February 18, 2019, the board of directors resolved to issue 659 thousand shares. The measurement date was at March 18, 2019, while total shares issued 599 thousand shares. The unit market price as of the granted date was NT\$43.45.

The employees who acquire the above shares can subscribe shares at the price of NT\$10 per shares while the vesting conditions are as below.

	Proportion of
Vesting conditions	vested shares
Within one month starting
the granted date	20%
April 25, 2019	20%
September 25, 2019	15%
April 25, 2020	15%
September 25, 2020	15%
April 25, 2021	15%

Restriction on employee's right after granted but before vested:

(a)The granted employee commit to the custodian institution, and shall not sell, pledge, transfer, donate, or dispose in any other ways, the right of restricted stocks before achieving the vesting conditions.
(b)After new shares of restricted stock are issued, the granted employee should immediately commit to the custodian institution, and not to ask the trustee to return

the restricted stock in any other reasons or ways before achieving the vesting conditions.

(c)The restricted stock for employees can participate in receiving dividends during the vesting period.
(d)The right to vote and elect in a shareholders' meeting shall be executed by custodian institution in accordance with related regulations.

On August 28, 2018, the issuance of 4,841 thousand restricted shares for employees resulted in the increase of capital reserve-employee stock option amounting to NT\$184,530 thousand. The restricted stocks plan was invalidated as of December 31, 2021 and 544 thousand shares were recalled. As a result, capital reserve increased by NT\$5,442 thousand and the unearned employee compensation was NT\$0.

On March 18, 2019, the issuance of 599 thousand restricted shares for employees resulted in the increase of capital reserve-employee stock option amounting to NT\$19,396 thousand. The restricted stocks plan was invalidated as of December 31, 2021 and 51 thousand shares were recalled. As a result, capital reserve increased by NT\$513 thousand and the unearned employee compensation was NT\$0.

B. The expense recognized for employee services received is shown in the following table.

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Total expense arising from equity-settled
share-based payment transactions	\$3,836	\$19,915

C. The Company did not modify the share-based payment plan for the the years ended December 31, 2021 and 2020.

(21)Sales

		For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Revenue from customer contracts
Sales of goods	\$35,192,556	\$26,813,266
Other operating revenue	480,207	285,208
Total	\$35,672,763	\$27,098,474

Analysis of revenue from contracts with customers during the years ended December 31, 2021 and 2020 are as follows:

A. Disaggregation of revenue

	IC Substrate	PCB	Optics	Total
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Sale of goods	\$27,253,199	\$2,344,314	\$5,595,043	\$35,192,556
Other	480,207	-	-	480,207
Total	\$27,733,406	\$2,344,314	\$5,595,043	\$35,672,763

The timing for revenue recognition:
At a point in time	\$27,733,406	\$2,344,314	\$5,595,043	\$35,672,763

	IC Substrate	PCB	Optics	Total
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Sale of goods	\$20,911,996	\$1,922,857	\$3,978,413	\$26,813,266
Other	285,208	-	-	285,208
Total	\$21,197,204	\$1,922,857	\$3,978,413	\$27,098,474

The timing for revenue recognition:
At a point in time	\$21,197,204	\$1,922,857	\$3,978,413	\$27,098,474

B. Contract balances

(a)Contract liabilities

		As of
	12/31/2021	12/31/2020	01/01/2020
	(NT\$'000)	(NT\$'000)	(NT\$'000)
Sales of goods	\$98,679	\$146,450	\$57,778
Customer loyalty programs	12,671	15,281	14,848
Total	\$111,350	\$161,731	\$72,626

The significant changes in the Group's balances of contract liabilities for the the years ended December 31, 2021 are as follows:

		Customer loyalty
	Sales of goods	programs
The opening balance transferred to revenue	\$(141,409)	\$(15,281)
Increase in receipts in advance during the	93,638	12,671
period (excluding the amount incurred and
transferred to revenue during the period)

The significant changes in the Group's balances of contract liabilities for the the years ended December 31, 2020 are as follows:

		Customer loyalty
	Sales of goods	programs
The opening balance transferred to revenue	\$(57,372)	\$(14,848)
Increase in receipts in advance during the	146,044	15,281
period (excluding the amount incurred and
transferred to revenue during the period)

(22)Expected credit losses/(gains)

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Operating expenses – Expected credit losses/(gains)
Account receivables	\$6,835	\$(6,144)

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

The Group measured the impairment against the other receivables reclassified from accounts receivable due to factoring agreements mainly based on the expected credit loss for 12 months of the counter-party financial institutions. As of December 31, 2021 and 2020, there were no other receivables past due. Furthermore, the Group assessed the related expected credit loss to be insignificant because the counter-party financial institutions are of good credit condition.

The Group measures the loss allowance of its contract assets and accounts receivable (including notes receivable and accounts receivable) at an amount equal to lifetime expected credit losses. The assessment of the Group's loss allowance as of December 31,2021 and 2020 are as follows:

A. The Group considers the grouping of accounts receivable by counterparties' credit rating, by geographical region and by industry sector and its loss allowance is measured by using a provision matrix. Details are as follows.

Group 1	Not past due			Past due
	(Note) (NT\$'000)	<=30 days (NT\$'000)	31-60 days (NT\$'000)	61-90 days (NT\$'000)	91-120 days (NT\$'000)	>=121 days (NT\$'000)	Individual evaluate	Total (NT\$'000)
Gross carrying amount	\$4,828,296	\$233,421	\$1,329	\$9	\$-	\$-	\$-	\$5,063,055
Loss ratio	-%	5%	15%	30%	50%	75%	100%
Lifetime expected	-	(11,671)	(200)	(2)	-	-	-	(11,873)
credit losses
Subtotal	4,828,296	221,750	1,129	7	-	-	-	5,051,182

December 31, 2021

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

Group 2	Not past due				Past due
	(Note)	<=30 days	31-60 days	61-90 days	91-120 days	>=121 days	Individual	Total
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	evaluate	(NT\$'000)
Gross carrying amount	\$633,065	\$21	\$-	\$-	\$-	\$-	\$9,218	\$642,304
Loss ratio		0.91% 1%	0%	0%		0%	0% 100%
Lifetime expected	(5,752)	(1)	-	-	-		- (9,218)	(14,971)
credit losses
Subtotal	627,313	20	-	-	-		- -	627,333
Carrying amount of accounts
receivable	\$5,455,609	\$221,770	\$1,129	\$7	\$-	\$-	\$-	\$5,678,515
Group 1		Not past due				Past due
		(Note)	<=30 days	31-60 days	61-90 days	91-120 days	>=121 days	Total
		(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Gross carrying amount Loss ratio		\$3,656,542 -%	\$162,200 5%	\$7,759 15%	\$16,081 30%	\$- 50%	\$- 75%	\$3,842,582
Lifetime expected credit losses		-	(8,110)	(1,164)	(4,824)	-	-	(14,098)
Subtotal		3,656,542	154,090	6,595	11,257	-	-	3,828,484
Group 2		Not past due				Past due
		(Note)	<=30 days	31-60 days	61-90 days	91-120 days	>=121 days	Total
		(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Gross carrying amount		\$570,762	\$9,870	\$-	\$-	\$-	\$-	\$580,632
Loss ratio		1.02%	1%	0%	0%%	0%%	0%
Lifetime expected credit losses		(5,818)	(99)	-	-	-	-	(5,917)
Subtotal		564,944	9,771	-	-	-	-	574,715
Carrying amount of accounts
receivable		\$4,221,486	\$163,861	\$6,595	\$11,257	\$-	\$-	\$4,403,199

Note: all the Group's note receivables were not past due.

B. The movement in the provision for impairment of note receivables and trade receivables during the years ended December 31, 2021 and 2020 are as follows:

	Notes receivable	Accounts receivable
	(NT\$'000)	(NT\$'000)
Beginning balance as of January 1, 2021	\$-	\$20,015
Addition/(reversal) for the current period	-	6,835
Effect of exchange rate	-	(6)
Ending balance as of December 31, 2021	\$-	\$26,844


	Notes receivable	Accounts receivable
	(NT\$'000)	(NT\$'000)
Beginning balance as of January 1, 2020	\$-	\$26,144
Addition/(reversal) for the current period	-	(6,144)
Effect of exchange rate	-	15

(23)Leases

A. Group as a lessee

The Group leases various properties, including real estate such as land and buildings, machinery and equipment, transportation equipment. These leases have terms of between 1 and 50 years. The Group may not allow to privately lend, sublease, sell, use by others in other disguised form, or transfer the lease to another person.

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

(a) Amounts recognized in the balance sheet

I. Right-of-use assets

			Machinery	Transportation
	Land	Buildings	and equipment	equipment	Total
Cost:
As of 1/1/2021	\$277,004	\$164,586	\$17,793	\$2,490	\$461,873
Addition	-	193,709	-	-	193,709
Disposals	-	(150,697)	(17,793)	(2,490)	(170,980)
Reclassification	-	-	-	-	-
Effect of EX rate	(5,247)	(274)	-	-	(5,521)
As of 12/31/2021	\$271,757	\$207,324	\$-	\$-	\$479,081

As of 1/1/2020	\$285,201	\$276,415	\$17,793	\$2,490	\$581,899
Addition	-	66,355	-	-	66,355
Disposals	(1,743)	(178,450)	-	-	(180,193)
Reclassification	-	-	-	-	-
Effect of EX rate	(6,454)	266	-	-	(6,188)
As of 12/31/2020	\$277,004	\$164,586	\$17,793	\$2,490	\$461,873

Depreciation and impairment:
As of 1/1/2021	\$72,006	\$62,519	\$13,776	\$1,840	\$150,141
Depreciation	5,561	49,780	4,017	54	59,412
Disposals	-	(62,464)	(17,793)	(1,894)	(82,151)
Reclassification	-	-	-	-	-
Effect of EX rate	(1,447)	(169)	-	-	(1,616)
As of 12/31/2021	\$76,120	\$49,666	\$-	\$-	\$125,786
As of 1/1/2020	\$68,656	\$123,449	\$6,888	\$815	\$199,808
Depreciation	6,874	106,302	6,888	1,025	121,089

Disposals	(1,743)	(167,334)	-	-	(169,077)
Reclassification	-	-	-	-	-
Effect of EX rate	(1,781)	102	-	-	(1,679)
As of 12/31/2020	\$72,006	\$62,519	\$13,776	\$1,840	\$150,141

Net carrying amount:
As of 12/31/2021	\$195,637	\$157,658	\$-	\$-	\$353,295
As of 12/31/2020	\$204,998	\$102,067	\$4,017	\$650	\$311,732

II. Lease liability

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Lease liabilities	\$161,503	\$106,246

Current	\$52,396	\$41,846
Non-current	109,107	64,400
Total	\$161,503	\$106,246

Please refer to Note 6(25) (C) for the interest on lease liability recognized during the year ended December 31, 2021 and 2020 and refer to Note 12(5) for the maturity analysis for lease liabilities as of December 31, 2021 and 2020.

(b) Income and costs relating to leasing activities

	For the year ended December 31,
	2021 2020
	(NT\$'000)	(NT\$'000)
The expense relating to short-term leases	\$(145,995)	\$(68,966)
The expense relating to leases of low-value	(702)	(1,448)
assets
Income from subleasing right-of-use assets	212	847

As at December 31, 2021 and 2020, the portfolio of short-term leases of the Group to which it is committed at the end of the reporting period is dissimilar to the portfolio of short-term leases to which the short-term lease expense disclosed above and the amount of its lease commitments is NT\$0.

For the year ended 2021 and 2020, the Group recognized NT\$5,913 thousand and NT\$5,920 thousand as income to account the rent concession arising as a direct consequence of the covid-19 pandemic as a variable lease payment.

During the years ended December 31, 2021 and 2020, the Group's total cash outflow for leases amounting to NT\$196,873 thousand, and NT\$193,106 thousand, respectively.

B. Group as a lessor

The Group has entered leases on plants. These leases have terms of between one and three years. These leases are classified as operating leases as they do not transfer substantially all the risks and rewards incidental to ownership of underlying assets.

		For the years ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Lease income for operating leases
Income relating to fixed lease payments	\$10,410	\$49,825

For operating leases entered by the Group, the undiscounted lease payments to be received and a total of the amounts for the remaining years as of December 31, 2021 and 2020 are as follows:

As of December 31,
2021	2020
(NT\$'000)	(NT\$'000)
\$392	\$42,602
2,027	35,316
\$2,419	\$77,918

(24)Summary statement of employee benefits, depreciation and amortization by function is as follows:

	For the year ended				For the year ended
Function		December 31, 2021			December 31, 2020
		(NT\$'000)			(NT\$'000)
Nature	Cost of	Operating		Cost of	Operating
	goods sold	expense	Total	goods sold	expense	Total
Employee benefit
Salaries & wages	\$5,298,481	\$1,753,667	\$7,052,148	\$3,985,804	\$1,086,070	\$5,071,874
Labor and health insurance	361,465	83,863	445,328	301,453	74,674	376,127
Pension	134,762	46,104	180,866	117,720	39,762	157,482
Other employee benefit	237,853	67,362	305,215	204,041	47,271	251,312
Depreciation	3,946,930	383,964	4,330,894	4,054,742	323,073	4,377,815
Amortization	245	46,273	46,518	108	39,546	39,654

According to the resolution, not lower than 10% 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 and supervisors. However, the Company's accumulated losses shall have been covered.

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, 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 and supervisors can be obtained from the "Market Observation Post System" on the website of the TWSE.

Based on profitability and following the rule of not lower than 10% and not higher than 1%, the Company incurred the employees' compensation and the remuneration to directors and supervisors, respectively, for the year ended December 31, 2021 and recorded them as employee benefits. As such, employees' compensation and remuneration to directors and supervisors for the year ended December 31, 2021 amounted to NT\$528,161 thousand and NT\$34,370 thousand, respectively, and, for the year ended December 31, 2020, NT\$70,587 thousand and NT\$4,313 thousand, respectively. The employees' compensation and remuneration to directors and supervisors were recognized as salaries.

The Company's Board of Directors' meeting has determined the employees' compensation and directors' remuneration, all in cash, to be NT\$70,857 thousand and NT\$4,313 thousand, respectively, in a meeting held on January 29, 2021. No material differences exist between the estimated amount and the actual distribution of the employee compensation and remuneration to directors and supervisors for the year ended December 31, 2020.

(25)Non-operating incomes and expenses

A. Interest incomes

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Interest income
Financial assets measured at amortized
cost	\$34,396	\$43,405
Other incomes
B.
	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Government grants income	\$8,457	\$3,458
Other income others –	209,727	275,233

C. Other gains and losses

	For the year ended December 31,
	2021 2020
	(NT\$'000)	(NT\$'000)
Gain (loss) from disposal of property, plant and equipment	\$18,739	\$(105,648)
Foreign exchange gain (loss), net	(15,268)	(88,999)
Gains (losses) on lease modification gains	710	160

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

Net gain of financial assets at fair value through profit or loss	1,939	5,529
Impairment losses – Property, plant and	(32,785)	(19,627)
equipment
Other expenses	(13,276)	(20,537)
Total	\$(39,941)	\$(229,122)

D. Finance costs

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Interest on bank loans	\$79,775	\$75,069
Interests on lease liabilities	1,358	1,634
Total	\$81,133	\$76,703

(26)Components of other comprehensive income (OCI)

For the year ended December 31, 2021

		Reclassification		Income tax
	Arising during	during the		benefit	OCI,
	the period	period	Subtotal	(expense)	Net of tax
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Not reclassified to profit or loss:
Actuarial gains or losses on
defined benefits plan	\$9,757	\$-	\$9,757	\$-	\$9,757
May be reclassified to profit or
loss in subsequent period:
Exchange differences arising on	(32,403)	-	(32,403)	-	(32,403)
translation of foreign operations
Share of other comprehensive	(1,623)	-	(1,623)	-	(1,623)
income of associates and joint
ventures accounted for using the
equity method
Total OCI	\$(24,269)	\$-	\$(24,269)	\$-	\$(24,269)

For the year ended December 31, 2020

		Reclassification		Income tax
	Arising during	during the		benefit	OCI,
	the period	period	Subtotal	(expense)	Net of tax
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Not reclassified to profit or loss:
Actuarial gains or losses on
defined benefits plan	\$(8,835)	\$-	\$(8,835)	\$-	\$(8,835)
May be reclassified to profit or
loss in subsequent period:
Exchange differences arising on	(8,107)	-	(8,107)	-	(8,107)
translation of foreign operations
Share of other comprehensive	(5,889)	-	(5,889)	-	(5,889)
income of associates and joint
ventures accounted for using the
equity method
Total OCI	\$(22,831)	\$-	\$(22,831)	\$-	\$(22,831)

(27)Income tax

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

Income tax expense (benefit) recognized in profit or loss

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Current income tax expense (benefit):
Current income tax expense	\$710,541	\$203,436
Adjustments in respect of current income	(42,129)	(14,289)
tax of prior periods
Deferred tax expense (benefit):
Deferred tax expense (benefit) relating to	3,391	4,679
origination and reversal of temporary
differences
Total income tax expense	\$671,803	\$193,826

B. A reconciliation between tax expense and the product of accounting profit multiplied by applicable tax rates is as follows:

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Accounting profit before tax from continuing
operations	\$4,492,108	\$1,123,269

Tax payable at the enacted tax rates	\$1,252,271	\$317,304
Surtax on Undistributed earnings	16,343	12,419
Tax effect of income tax-exempted	(83,019)	6,101
Tax effect of expenses not deductible for tax	(23,426)	78
purposes
Tax effect of deferred tax assets/liabilities	(190,288)	(52,639)
Reversal of uncertain tax position upon	(42,129)	(14,289)
finalization
Others	(257,949)	(75,148)
Total income tax expense recognized in profit
or loss	\$671,803	\$193,826

C. Deferred tax assets (liabilities) relate to the following:

For the year ended December 31, 2021

	Deferred tax			Ending balance
	Beginning balance	income (expense)	Exchange	as of Dec. 31,
	as of Jan. 1, 2021	recognized in P/L	adjustment	2021
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Temporary differences
Prepaid appreciation tax on	\$9,593	\$-	\$-	\$9,593
agricultural land
Unrealized loss on inventory	18,120	(6,563)	-	11,557
valuation
Unrealized exchange loss (gain)	(9,488)	9,133	-	(355)
Unrealized exchange loss (gain)	-	1,302	-	1,302
Other	549	123	(71)	601

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

Investments accounted for using the equity method	(18,275)	(7,386)	-	(25,661)
Deferred tax income/(expense)		\$(3,391)	\$(71)
Net deferred tax assets/(liabilities)	\$499			\$(2,963)

Reflected in balance sheet as
follows:
Deferred tax assets	\$28,262			\$23,053
Deferred tax liabilities	\$(27,763)			\$(26,016)

For the year ended December 31, 2020

		Deferred tax		Ending balance
	Beginning balance	income (expense)	Exchange	as of Dec. 31,
	as of Jan. 1, 2020	recognized in P/L	adjustment	2020
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Temporary differences
Prepaid appreciation tax on	\$9,593	\$-	\$-	\$9,593
agricultural land
Unrealized loss on inventory	1,991	16,129	-	18,120
valuation
Unrealized exchange loss (gain)	1,476	(10,964)	-	(9,488)
Other	740	(192)	1	549
Investments accounted for using	(8,623)	(9,652)	-	(18,275)
the equity method
Deferred tax income/ (expense)		\$(4,679)	\$1
Net deferred tax assets/(liabilities)	\$5,177			\$499
Reflected in balance sheet as
follows:
Deferred tax assets	\$13,800			\$28,262
Deferred tax liabilities	\$(8,623)			\$(27,763)

D. Unrecognized deferred tax assets

As of December 31, 2021 and 2020, deferred tax assets that have not been recognized as they may not be used to offset future taxable income amounted to NT\$1,541,832 thousand and NT\$1,545,521 thousand, respectively.

E. Unused balance of deductible net operating loss within the Company was listed as follows:

			Unused balance
	Accumulated net		As of December 31,
Occurrence	operating loss	2021	2020	Expiration
year	(NT\$'000)	(NT\$'000)	(NT\$'000)	Year
2012	\$101,046	\$95,084	\$95,555	2022
2019	2,023,410	366,800	1,526,440	2029
		\$461,884	\$1,621,995

F. The assessment of income tax return

As of December 31, 2021, the assessment status of income tax returns of the Company and subsidiaries was as follows:

	The assessment of income tax returns
The Company	Assessed and approved up to 2019
Subsidiary - Pegavision Corporation	Assessed and approved up to 2019
Subsidiary - Kinsus Investment Co., Ltd.	Assessed and approved up to 2019
Subsidiary - BeautyTech Platform	The first-time assessment of 2020 has not yet
Corporation	been approved.
Subsidiary - Mayin Investment Co., Ltd.	The registration was completed at August 19,
	2021. So there is no income tax declaration.
Subsidiary - FacialBeau International	The registration was completed at October 22,
Corporation	2021. So there is no income tax declaration.

(28)Earnings per share

Basic earnings per share is calculated by dividing net profit for the year attributable to the common shareholders of the parent entity by the weighted average number of common shares outstanding during the year.

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

A. Basic earnings per share

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Net income attributable to common
shareholders of the parent (in NT\$'000)	\$3,858,984	\$541,914
Weighted average number of common shares
outstanding (in thousand shares)	450,646	449,502
Basic earnings per share (in NT\$)	\$8.56	\$1.21

B. Diluted earnings per share

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Net income attributable to common
shareholders of the parent (NT\$'000)	\$3,858,984	\$541,914
Net income attributable to common
shareholders of the parent after dilution
(NT\$'000)	\$3,858,984	\$541,914

Weighted average number of common shares
outstanding (in thousand shares)	450,646	449,502
Effect of dilution:
Employee bonus (compensation) – stock (in
thousand shares)	2,571	876
Restricted stocks (in thousand shares)	-	963
Weighted average number of common shares
outstanding after dilution (in thousand shares)	453,217	451,341
Diluted earnings per share (in NT\$)	\$8.51	\$1.20

No other transactions that would significantly change the outstanding common shares or potential common shares incurred during the period after reporting date and up to the approval date of financial statements.

(29)Subsidiary that has material non-controlling interests

Proportion of equity interest held by non-controlling interests:

		As of December 31,
Name	Country	2021	2020
PIOTEK HOLDINGS LTD. and its	China	49.00%	49.00%
subsidiary
Pegavision Corporation and its subsidiary	Taiwan	69.67%	69.67%

Accumulated balances of material non-controlling interest:

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
PIOTEK HOLDINGS LTD. and its subsidiaries	\$75,477	\$318,252
Pegavision Corporation and its subsidiary	\$3,844,289	\$3,201,655

Profit (loss) allocated to material non-controlling interest:

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
PIOTEK HOLDINGS LTD. and its subsidiaries	\$(236,570)	\$(110,833)
Pegavision Corporation and its subsidiary	\$869,694	\$498,362

The summarized financial information of this subsidiary is provided below. This information is based on amounts before inter-company eliminations.

Summarized PIOTEK HOLDINGS LTD. and its subsidiaries information of profit or loss is as follows:

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Operating revenue	\$2,344,680	\$1,927,343
Profit/loss from continuing operation	(482,761)	(226,211)
Total comprehensive income for the period	(495,436)	(261,990)

Summarized Pegavision Corporation and its subsidiaries information of profit or loss is as follows:

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Operating revenue	\$5,595,043	\$3,978,413
Profit/loss from continuing operation	1,248,436	715,359
Total comprehensive income for the period	1,240,212	717,010

Summarized PIOTEK HOLDINGS LTD. And its subsidiaries information of financial position is as follows:

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Current assets	\$1,258,443	\$1,146,983
Non-current assets	952,045	1,115,410
Current liabilities	1,039,165	996,237
Non-current liabilities	1,017,267	616,664

Summarized Pegavision Corporation and its subsidiaries information of financial position is as follows:

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Current assets	\$3,262,570	\$2,890,778
Non-current assets	5,302,346	3,525,253
Current liabilities	2,778,429	1,716,965
Non-current liabilities	278,060	103,350

Summarized PIOTEK HOLDINGS LTD. And its subsidiaries cash flows information is as follows:

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Operating activities	\$(213,183)	\$(86,635)
Investing activities	(56,782)	(44,601)
Financing activities	208,461	19,186
Net increase/(decrease) in cash and cash equivalents	(44,702)	(89,187)

Summarized Pegavision Corporation and its subsidiaries cash flows information is as follows:

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Operating activities	\$2,632,863	\$1,194,216
Investing activities	(1,848,633)	(718,975)
Financing activities	(172,250)	(43,833)
Net increase/(decrease) in cash and cash equivalents	593,964	433,194

7. RELATED PARTY TRANSACTIONS

(1)Deal with related parties as of the end of the reporting period

Related parties and Relationship

Related parties	Relationship
Pegatron Corporation	Parent company
FuYang Technology Corp.	Associate
AzureWave Technologies, Inc	Other related parties
AzureWave Technologies (Shanghai) Inc.	Other related parties
PEGATRON JAPAN INC	Other related parties
Maintek Computer (Suzhou) Co., Ltd	Other related parties
GNDC Co., Ltd.	Other related parties
DIGITEK (CHONGQING) LIMITED	Other related parties
COTEK ELECTRONICS(SUZHOU) CO., LTD.	Other related parties
ASIAROCK TECHNOLOGY LIMITED	Other related parties
PEGATRON CZECH S.R.O	Other related parties
ASROCK RACK INCORPORATION	Other related parties

(2)Significant transactions with related parties

A. Sales

	For the year ended December 31,
	2021 2020
	(NT\$'000)	(NT\$'000)
Parent company	\$1,329	\$7,650
Other related parties	92,903	220,918
Total	\$94,232	\$228,568

Selling prices and collection terms to related parties are similar to those to third party customers for the year ended December 31, 2021 and 2020. The collection terms are 30 to 90 days from the end of delivery month by telegraphic transfer.

B. Lease-related parties

(a) Right-of-use assets

		December 31, As of
		2021	2020
Related parties	Nature	(NT\$'000)	(NT\$'000)
Other related parties	Buildings	\$1,164	\$635

(b) Lease liabilities

	As of	December 31,
	2021	2020
Related parties	(NT\$'000)	(NT\$'000)
Other related parties	\$1,165	\$643

(c) Lease payment (Rental expense)

		For the year ended December 31,
		2021	2020
Related parties	Nature	(NT\$'000)	(NT\$'000)
Parent company	Various facilities	\$-	\$625
Parent company	Plant	100,846	38,369
Total		\$100,846	\$38,994

(d) Interest expenses

	For the year ended December 31,
	2021 2020
Related parties	(NT\$'000) (NT\$'000)
Parent company	\$-	\$248
Other related parties	6	14
Total	\$6 \$262

C. For the year ended December 31, 2021 and 2020, the Group recognized operating expenses of NT\$210 thousand and NT\$2,818 thousand, respectively, for services provided by other related parties.

Moreover, for the year ended December 31, 2021 and 2020, the Group recognized operating expenses of NT\$331 thousand and NT\$361 thousand (tax included), respectively, for services provided by the Parent.

In addition, for the year ended December 31, 2021 and 2020, the Group incurred operating expenses of NT\$93,649 thousand and NT\$69,793 thousand (tax included), respectively, for utility bills paid by the Parent on behalf of the Group.

For the year ended December 31, 2021 and 2020, the Group recognized operating expense of NT\$224 thousand and NT\$2,636 thousand, respectively, due to subcontracting maintenance and repair on factories to its associate.

D. For the year ended December 31, 2021 and 2020, the Group recognized rent income of NT\$1,229 thousand and NT\$952 thousand, respectively, for plants leased to other related parties.

For the year ended December 31, 2021 and 2020, the Group recognized rent income of NT\$3,538 thousand and NT\$43,227 thousand, respectively, for plants leased to the associate.

E. For the year ended December 31, 2021 and 2020, the Group recognized other income in amount of NT\$361 thousand and NT\$18,934 thousand, respectively, due to paying utilities on behalf of associate.
F. For the year ended December 31, 2021, the Group recognized expense of NT\$4,477 thousand for providing services to other related parties.
G. For the year ended December 31, 2021, the Group recognized operating expense of NT\$150 thousand bills paid repair expense to its associate.
H. Accounts receivable related parties

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Parent company	\$141	\$1,240
Other related parties	26,170	23,622

26,311	24,862
-	-
\$26,311	\$24,862

I. Other receivables

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Associate	\$-	\$3,859
Other related parties	367	255
Total	\$367	\$4,114

J. Refundable deposits

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Parent company	\$10,000	\$10,000
Other related parties	352	-
Total	\$10,352	\$10,000

K. Accrued expenses

	As of December 31,
	2021 2020
	(NT\$'000)	(NT\$'000)
Parent company	\$33,981	\$19,705
Associate	-	467
Other related parties	26	499
Total	\$34,007	\$20,671

J. Salaries and rewards to key management of the Group

	For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Short-term employee benefit	\$52,426	\$45,130
Post-employee benefit	963	864
Total	\$53,389	\$45,994

8. PLEDGED ASSETS

The following assets of the Group are pledged as collaterals:

	Carrying Amount As of
	2021	2020
Item	(NT\$'000)	(NT\$'000)	Purpose
Property, plant and equipment -	\$42,036	\$61,249	Long-term secured loans
buildings (carrying amount)
Financial assets measured at	-	44,110	Guarantee of provisional
amortized cost			attachment
Refundable deposits	2,000	2,000	Security deposit to
			custom authority
Refundable deposits	2,535	-	Litigation deposit
Total	\$46,571	\$107,359

9. SIGNIFICANT CONTINGENCIES AND UNRECOGNIZED CONTRACT COMMITMENTS

(1) The Group's unused letters of credit (LC) as of December 31, 2021 are as follows:

Currency	LC Amount (in thousand)		Security (in thousand)
JPY	JPY	7,027,057	\$-
USD	USD	9,455	-
EUR	EUR	813	-

(2) Details of significant constructions in progress and outstanding contracts of property, plant and equipment as of December 31, 2021 are as follows:

			Outstanding
	Contract Amount	Amount Paid	Balance
Nature of Contract	(NT\$'000)	(NT\$'000)	(NT\$'000)
Machinery and
construction contracts	\$7,550,186	\$3,879,489	\$3,670,697

(3) The Group had disputes with Wuxi Land Environmental Technology Co.,LTD. ("Wuxi Land Company" hereinafter) regarding the hazardous waste clean up and recycle contract. In June 2020, Wuxi Land Company filed a lawsuit against and Group and requested returning security deposit of RMB 1,000 thousand and prepayment of RMB 9,081 thousand. As of September 30, 2021, the Group received RMB 14,392 thousand from Wuxi Land Company, and the payment was booked under receipts in advance. Wuxi Land Company filed to freeze the advance receipt in August 2020. The People's Court of Huqiu District, Suzhou City ruled to freeze RMB 10,100 thousand, which the Group accounted for under restricted assets. According to the judgment of the Suzhou Intermediate People's Court dated December 3, 2021, the Group shall return security deposit of RMB 1,000 thousand and prepayment of RMB 8,998 thousand to Wuxi Land Company. The Company made the payments in full as of December 31, 2021.
(4) The Group has entered into a long-term sales agreement with its customer. The customer should fulfill its obligation of making a certain number of orders as agreed in the agreement and the Group shall provide the products to the customer pursuant to the agreement.
(5) The Group entered into long-term sales agreements with its customers. According to the agreement, after customers pay the deposit in advance, the Group shall provide the products to the customer pursuant to the agreement.

10. SIGNIFICANT DISASTER LOSS

None

11. SIGNIFICANT SUBSEQUENT EVENT

The Company's board of directors has approved an issuance of restricted stock awards in a meeting held on February 15, 2022. Total share volume to be issued are 5,400,000 and each at a price of NT\$85.6. The final issuance terms and conditions are subject to the Company's board approval.

12. OTHERS

(1) Categories of financial instruments

Financial assets

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Financial assets at fair value through profit or loss:
Mandatorily measured at fair value through P/L	\$616,080	\$1,594,063
Financial assets at fair value through OCI	51,000	51,000
Financial assets measured at amortized cost
Cash and petty cash	15,332,027	11,664,932
Time deposit	20,057	423,057
Restricted deposit	-	44,110
Accounts receivable	5,678,515	4,403,199
Other receivables	406,782	145,275
Total	\$22,104,461	\$18,325,636

Financial liabilities

	As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Financial liabilities at amortized cost:
Short-term borrowings	\$1,099,846	\$2,640,307
Trade and other payables	10,149,786	6,338,434

Long-term borrowings (including current portion
with maturity less than 1 year)	10,078,111	3,609,548
Lease liabilities (including current portion with
maturity less than 1 year)	161,503	106,246
Total	\$21,489,246	\$12,694,535

(2) Objectives and policies of financial risk management

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

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 always.

(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 risk comprises currency risk, interest rate risk and other price risk (e.g. 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 foreign currency risk relates primarily to the Group's operating activities (when revenue or expense are denominated in a different currency from the Group's functional currency) and the Group's net investments in foreign operations. The Group has certain foreign currency receivables denominated in the same foreign currency as certain foreign currency payables, therefore natural hedge is achieved. Thus, hedge accounting is not adopted.

Foreign currency sensitivity analysis of possible change in foreign exchange rates on the Group's profit/loss and equity is performed on significant monetary items denominated in foreign currencies as of the reporting period-end. The Group's foreign currency risk is mainly related to volatility in the exchange rates of US dollars. It is stated as follows:

If NT dollars appreciates/depreciates against US dollars by 1%, net income (loss) for the year ended December 31, 2021 and 2020 would decrease/increase by NT\$37,195 thousand and NT\$10,813 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's exposure to interest rate risk relates primarily to the Group's investments with variable interest rates and loans with fixed and variable interest rates, which are all categorized as loans and receivables.

The interest rate sensitivity analysis is performed on items exposed to interest rate risk as of the end of the reporting period and presumed to be held for one accounting year, including investments and loans with variable interest rates. If interest rate increases/decreases by 0.1%, the net income (loss) for the year ended December 31, 2021 and 2020 would decrease/increase by NT\$5,694 thousand and NT\$2,959 thousand, respectively.

(4) Credit risk management

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

Customer credit risk is managed by each business unit subject to the Group's established policy, procedures and control relating to customer credit risk management. Credit risk of all customers are assessed based on a comprehensive review of the customers' financial status, credit ratings from credit institutions, past transactions, current economic conditions and the Group's internal credit ratings. The Group also employs some credit enhancement instruments (e.g. prepayment or insurance) to reduce certain customers' credit risk.

As of December 31, 2021 and 2020, receivables from the top ten customers were accounted for 44.01% and 44.04% of the Group's total accounts receivable, respectively. The concentration of credit risk is relatively insignificant for the remaining receivables.

Credit risk from balances with banks and other financial instruments is managed by the Group's finance division in accordance with the Group's policy. The counterparties that the Group transacts with are determined by internal control procedures. They are banks with fine credit ratings and financial institutions, corporate and government agencies with investmentgrade credit ratings. Thus, there is no significant default risk. Conclusively, no significant credit risk is expected by the Group.

The Group adopted IFRS 9 to assess the expected credit losses. Except for trade receivables, the remaining debt instrument investments which are not measured at fair value through profit or loss, low credit risk for these investments is a prerequisite upon acquisition and by using their credit risk as a basis for the distinction of categories. The Group makes an assessment at each reporting date as to whether the credit risk still meets the conditions of low credit risk and then further determines the method of measuring the loss allowance and the loss ratio.

Financial assets are written off when there is no realistic prospect of future recovery (the issuer or the debtor is in financial difficulties or bankruptcy).

(5) Liquidity risk management

The Group maintains financial flexibility using cash and cash equivalents, highly-liquid marketable securities, bank loans, etc. 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. The undiscounted interest payment relating to borrowings with variable interest rates is extrapolated based on the estimated yield curve as of the end of the reporting period.

Non-derivative financial instruments

	Less than					More than 5
	1 year	1 to 2 years	2 to 3 years	3 to 4 years	4 to 5 years	years	Total
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
As of December 31, 2021
Loans	\$1,904,121	\$1,332,751	\$1,819,319	\$2,414,663	\$2,223,156	\$1,997,783	\$11,691,793
Payables	10,149,786	-	-	-	-	-	10,149,786
Lease liabilities	53,668	41,761	28,400	19,691	8,216	12,964	164,700

As of December 31, 2020
Loans	\$3,654,003	\$652,545	\$511,944	\$539,216	\$535,089	\$453,533	\$6,346,330
Payables	6,338,434	-	-	-	-	-	6,338,434
Lease liabilities	42,787	26,382	11,655	5,684	4,763	17,553	108,824

(6) Movement schedule of liabilities arising from financing activities

Movement schedule of liabilities for year ended December 31, 2021:

	Short-term	Long-term	Refundable	Leases	Total liabilities from
	borrowings	borrowings	deposits	liabilities	financing activities
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
As of January 1, 2021	\$2,640,307	\$3,609,548	\$73,235	\$106,246	\$6,429,336
Cash flows	(1,540,461)	6,515,162	1,747,172	(50,176)	6,671,697
Non-cash changes
Lease range changes	-	-	-	104,170	104,170
Interests on lease liabilities	-	-	-	1,358	1,358
Other	-	(30,329)	-	-	(30,329)
Currency rate change	-	(16,270)	-	(95)	(16,365)
As of December 31, 2021	\$1,099,846	\$10,078,111	\$1,820,407	\$161,503	\$13,159,867

	Short-term	Long-term	Refundable	Leases	Total liabilities from
	borrowings	borrowings	deposits	liabilities	financing activities
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
As of January 1, 2020	\$4,096,101	\$3,046,550	\$43,836	\$172,080	\$7,358,567
Cash flows	(1,455,794)	596,520	29,399	(122,692)	(952,567)
Non-cash changes
Lease range changes	-	-	-	55,079	55,079
Interests on lease liabilities	-	-	-	1,634	1,634
Other	-	(27,959)	-	-	(27,959)
Currency rate change	-	(5,563)	-	145	(5,418)
As of December 31, 2020	\$2,640,307	\$3,609,548	\$73,235	\$106,246	\$6,429,336

Movement schedule of liabilities for the year ended December 31, 2020:

(7) Fair values of financial instruments
A. The evaluation methods and assumptions applied in determining the fair value

Fair value is the price that would be received to sell a financial asset or paid to transfer a financial liability in an orderly transaction between willing market participants (not under coercion or liquidation). The following methods and assumptions are used by the Group in estimating the fair values of financial assets and liabilities:

(a) The carrying amount of cash and cash equivalents, receivables, payables and other current liabilities approximate their fair value due to their short maturity terms.
(b) 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 (e.g. listed equity securities, beneficiary certificates, bonds and futures etc.) at the report date.
(c) Fair value of equity instruments without market quotations (including private placement of listed equity securities, unquoted public company and private company equity securities) are estimated using the market method 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).
(d) Fair value of debt instruments without market quotations, bank loans, bonds payable and other non-current liabilities are determined based on the counterparty prices or valuation method. The valuation method uses DCF method as a basis, and the assumptions such as the interest rate and discount rate are primarily based on relevant information of similar instrument (such as yield curves published by the GreTai Securities Market, average prices for Fixed Rate Commercial Paper published by Reuters and credit risk, etc.)
B. Fair value of financial instruments measured at amortized cost

The carrying amount of the Group's financial assets and liabilities measure at amortized cost approximates their fair value.

C. Fair value measurement hierarchy for financial instruments

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 asset or liability

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:

As of December 31, 2021

	Level 1	Level 2	Level 3	Total
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Financial assets:
Financial assets at fair value through
profit or loss
Funds	\$616,080	\$-	\$-	\$616,080
Financial assets at fair value through
other comprehensive income
Equity instrument measured at	-	-	51,000	51,000
fair value through other
comprehensive income
Financial liabilities:
None

As of December 31, 2020

	Level 1	Level 2	Level 3	Total
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
Financial assets:
Financial assets at fair value through
profit or loss
Funds	\$1,594,063	\$-	\$-	\$1,594,063
Financial assets at fair value through
other comprehensive income
Equity instrument measured at	-	-	51,000	51,000
fair value through other
comprehensive income

Financial liabilities: None

Transfers between Level 1 and Level 2 during the period

For the year ended December 31, 2021 and 2020, there were no transfers between Level 1 and Level 2 fair value hierarchy.

Reconciliations for fair value measurement on a recurring basis in Level 3 hierarchy

For the year ended December 31, 2021 and 2020, there were not movement of fair value measurements.

(9) Significant financial assets and liabilities denominated in foreign currencies

Information regarding the Group's significant financial assets and liabilities denominated in foreign currencies was listed below: (In Thousands)

		As of December 31,
		2021			2020
	Foreign			Foreign
	Currencies	Exchange	NTD	Currencies	Exchange	NTD
	(\$'000)	Rate	(NT\$'000)	(\$'000)	Rate	(NT\$'000)
Financial assets
Monetary items:
USD	\$245,037	27.702	\$6,788,004	\$159,309	28.4965	\$4,539,756
CNY	\$160,266	4.342	\$695,867	\$185,771	4.3674	\$811,327
Financial liabilities
Monetary items:
USD	\$110,844	27.683	\$3,068,501	\$121,365	28.4965	\$3,458,474
CNY	\$258,978	4.342	\$1,124,473	\$189,148	4.3674	\$826,074

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

Foreign exchange gain/loss on monetary financial assets and liabilities is shown as below.

	For the year ended December 31,
Foreign currency	2021	2020
resulting in exchange gain or loss	(NT\$'000)	(NT\$'000)
USD	\$(27,671)	\$(100,591)
Other	12,403	11,592

(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 to support its business and maximize shareholder value. The Group manages and adjusts its capital structure considering 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.

13. ADDITIONAL DISCLOSURES

(1) Information on significant transactions
A. Financing provided to others: None.
B. Endorsement/Guarantee provided to others: Please refer to attachment 1.
C. Marketable securities held as of December 31, 2021 (excluding investments in subsidiaries, associates and joint ventures): Please refer to attachment 2.
D. Individual securities acquired or disposed of with accumulated amount of at least NT\$ 300 million or 20 percent of the paid-in capital for the year ended December 31, 2021: None.
E. Acquisition of individual real estate with amount of at least NT\$300 million or 20 percent of the paid-in capital for the year ended December 31, 2021: Please refer to attachment 3.
F. Disposal of individual real estate with amount of at least NT\$100 million or 20 percent of the paid-in capital for the year ended December 31, 2021: None.
G. Related party transactions with purchase or sales amount of at least NT\$100 million or 20 percent of the paid-in capital for the year ended December 31, 2021: Please refer to attachment 4.
H. Receivables from related parties of at least NT\$100 million or 20 percent of the paid-in capital as of December 31, 2021: None.
I. Derivative instrument transactions: None.
J. Intercompany relationships and significant intercompany transactions for the year ended December 31, 2021: Please refer to attachment 10.
(2) Information on investees
A. Investees over whom the Company exercises significant influence or control (excluding investees in Mainland China): Please refer to attachment 5.
B. Investees over which the Company exercises control shall be disclosed of information under Note 13(1):
- (a) Financing provided to others: None.
- (b) Endorsement/Guarantee provided to others: None.
- (c) Marketable securities held as of December 31, 2021 (excluding investments in subsidiaries, associates and joint ventures): Please refer to attachment 6.
- (d)Individual securities acquired or disposed of with accumulated amount of at least NT\$300 million or 20 percent of the paid-in capital for the year ended December 31, 2021: Please refer to attachment 7.
- (e) Acquisition of individual real estate with amount of at least NT\$300 million or 20 percent of the paid-in capital for the year ended December 31, 2021: None.
- (f) Disposal of individual real estate with amount of at least NT\$300 million or 20 percent of the paid-in capital for the year ended December 31, 2021: None.
(g)Related party transactions with purchase or sales amount of at least NT\$100 million or 20 percent of the paid-in capital for the year ended December 31, 2021: Please refer to attachment 8.
(h)Receivables from related parties of at least NT\$100 million or 20 percent of the paidin capital as of December 31, 2021: Please refer to attachment 9.
(i) Derivative instrument transactions: None.

(3) Information on investments in Mainland China:

A. Name of investee in China, main business, paid-in capital, method of investment, investment flows, percentage of ownership, investment gain or loss, carrying amount at the end of reporting period, inward remittance of earning or loss and the upper limit on investment in China:

(In Thousands of New Taiwan Dollars)

Name of Investee in China	Main Business	Paid-in Capital (NT\$'000)	Method of Investment (Note 1)	Accumulated Outflow of Investment from Taiwan as of Jan. 1, 2021 (NT\$'000)	Investment Flows Outflow (NT\$'000)	Inflow (NT\$'000)	Accumulated Outflow of Investment from Taiwan as of Dec. 31, 2021 (NT\$'000)	Profit/ Loss of Investee (NT\$'000)	Percentage of Ownership (Direct or Indirect Investment)	Share of Profit/Loss (NT\$'000)	Carrying Amount as of Dec. 31, 2021 (NT\$'000)	Accumulated Inward Remittance of Earnings as of Dec. 31, 2021 (NT\$'000)	Accumulated Outflow of Investment from Taiwan to Mainland China as of Dec. 31, 2021 (NT\$'000)	Investment Amounts Authorized by Investment Commission, MOEA (NT\$'000)	Upper Limit on Investment in China by Investment Commission, MOEA (NT\$'000)
Kinsus Interconnect Technology Suzhou Corp.	Manufacturing and selling PCB (not high density fine line)	\$1,937,810 (Note 2)	(2)	\$1,937,810 (Note 2)	\$-	\$-	\$1,937,810 (Note 2)	\$569,848 (Note 2 and Note 4)	100%	\$569,848 (Note 2, Note 4 and Note 7)	\$2,258,651 (Note 2, Note 4 and Note 7)	\$-	\$1,937,810 (Note 2)	\$1,937,810 (Note 2)	No upper limit (Note 5)

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

Piotek Computer (Suzhou) Co., Ltd.	Researching, developing, producing and selling electronic components, PCBs and related products and providing after sale services	\$4,614,756 (Note 2)	(2)	\$2,609,233 (Note 2)	\$-	\$-	\$2,609,233 (Note 2)	\$(471,851) (Note 2 and Note 4)	51%	\$(240,644) (Note 2, Note 4 and Note 7)	\$45,547 (Note 2, Note 4 and Note 7)	\$-	\$2,609,233 (Note 2)	\$2,609,233 (Note 2)
Xiang-Shuo (Suzhou) Trading Limited	Trading of PCB (not high density fine line) and material for related products	\$55,366 (Note 2)	(2)	\$55,366 (Note 2)	\$-	\$-	\$55,366 (Note 2)	\$(932) (Note 2 and Note 4)	100%	\$(932) (Note 2, Note 4 and Note 7)	\$58,473 (Note 2, Note 4 and Note 7)	\$-	\$55,366 (Note 2)	\$55,366 (Note 2)
Pegavision Contact Lenses (Shanghai) Corporation	Selling medical equipment	\$112,559 (USD3,600)	(1)	\$112,559	\$-	\$-	\$112,559	\$2,613 (Note 2 and Note 4)	30.33%	\$793 (Note 2, Note 4 and Note 7)	\$32,812 (Note 2, Note 4 and Note 7)	\$-	\$112,559	\$112,559	\$3,305,056 (Note 6)

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

Gemvision Technology (Zhejiang) Limited	Selling medical equipment	\$95,523 (RMB22,000) (Note 2)	(3) (Note 3)	\$-	\$-	\$-	\$-	\$(9,923) (Note 2 and Note 4)	30.33%	\$(3,010) (Note 2, Note 4 and Note 7)	\$25,116 (Note 2, Note 4 and Note 7)	\$-	\$-	\$-
Pegavision (Jiangsu) Limited	producing and Selling medical equipment	\$85,620 (USD3,000) (Note 2)	(1)	\$-	\$85,620	\$-	\$85,620	\$(5,205) (Note 2 and Note 4)	30.33%	\$(1,579) (Note 2, Note 4 and Note 7)	\$24,381 (Note 2, Note 4 and Note 7)	\$-	\$85,620	\$85,620

Note 1: The investment methods are divided into the following three types, just indicate the types:

(1) Go directly to the mainland for investment.
(2) Reinvest in mainland China through a third-region company.
(3) Other methods.
Note 2: Amounts in foreign currencies are translated into New Taiwan dollars using the exchange rates on the balance sheet date.
Note 3: Pegavision Contact Lenses (Shanghai) Corporation recognized the profit/loss and carrying amount of Gemvisoon Technology (Zhejiang) Limited.
Note 4: Gain/loss on investment is recognized based on the financial statements which were audited by the independent auditors of the parent company in Taiwan.
Note 5:The Company meets the conditions of corporate operation headquarter in the Principle of Evaluation for Investment and Technical Cooperation in Mainland China. Thus, there is no upper limit on investment amount.
Note 6: The upper limit on investment for Pegavision Contact Lenses (Shanghai) Corporation, Gemvisoon Technology (Zhejiang) Limited and Pegavision (Jiangsu) Limited is calculated as 60% of the net value of the recent financial statements audited by independent auditors of Pagavision Corporation.
Note 7: Transactions are eliminated upon preparation of consolidated financial statements.
B. Significant transactions with investees in China:
(a) Purchase and balances of related accounts payable as of December 31, 2021: Please refer to attachment 10 for details.
(b) Sale and balance of related accounts receivable as of December 31, 2021: Please refer to attachment 10 for details.
(c) Property transaction amounts and resulting gain or loss:

					Reference
		Carrying		Gain on	basis for price
Variety	Related parties	Value	Price	disposal	decision
Machinery	Kinsus Interconnect				Negotiated
	Technology Suzhou Corp	\$247,416	\$285,972	\$38,556	price
				(Note)

Machinery	Kinsus Interconnect				Negotiated
	Technology Suzhou Corp	\$14,156	\$30,773	\$16,617	price
				(Note 1)

Note: For the year ended December 31, 2019, the Company wrote off NT\$38,556 thousand due to the unrealized gain on disposal of property, plant and equipment. As of December 31, 2021, unrealized gain on disposal of property, plant and equipment is NT\$13,132 thousand, and recongnized as the credit balance of investments accounted for using the equity method.
Note1: For the year ended December 31, 2021, the Company wrote off NT\$16,617 thousand due to the unrealized gain on disposal of property, plant and equipment. As of December 31, 2021, unrealized gain on disposal of property, plant and equipment is NT\$15,686 thousand, and recongnized as the credit balance of investments accounted for using the equity method.
(d) Ending balance of endorsements/guarantees or collateral provided and the purposes: None.
(e) Maximum balance, ending balance, interest rate range and total interest for current period from financing provided to others: None.
(f) Transactions that have significant impact on profit or loss of current period or the financial position, such as services provided or rendered: Please refer to attachment 10 for details.
(g) Above transactions are eliminated upon preparation of consolidated financial statements. Please refer to attachment 10 for details.
(4) Information on major shareholders:

Ownership of
shares	Number of shares held
Name	(shares)	Ownership ratio
Asus Investment Co., Ltd.	60,128,417	13.33%
Asustek Investment Co., Ltd.	58,233,091	12.91%
Asuspower Investment	55,556,221	12.32%

14. OPERATING SEGMENT

For management purposes, the Group is organized into operating segments based on different products and services and has three reportable operating segments as follows:

IC Substrate: This segment produces and manufactures BGA substrates and sells the products to manufacturers of electronic products.

Printed Circuit Board (PCB): This segment produces and manufactures PCBs and sells the products to manufacturers of electronic products.

Optics: This segment produces, manufactures and sells contact lens.

No operating segments have been aggregated to form the above reportable operating segments.

The Group's operating segments adopts the same accounting policies as the ones in Note 4. Management monitors the operating results of its business units separately for decision-making on resource allocation and performance assessment. Segment performance is evaluated based on operating profit or loss and measured consistently with methods applied to operating profit or loss in the consolidated financial statements.

(1)Segment income (loss), assets and liabilities

For the year ended December 31, 2021

	IC Substrate (NT\$'000)	PCB (NT\$'000)	Optics (NT\$'000)	Elimination (NT\$'000)	Consolidated (NT\$'000)
External customer	\$27,733,406	\$2,344,314	\$5,595,043	\$-	\$35,672,763
Inter-segment	-	-	-	-	-
Total revenue	\$27,733,406	\$2,344,314	\$5,595,043	\$-	\$35,672,763
Segment income (loss)	\$3,727,218	\$(483,546)	\$1,248,436	\$-	\$4,492,108

For the year ended December 31, 2020

	IC Substrate	PCB	Optics	Elimination	Consolidated
	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)

External customer	\$21,197,204	\$1,922,857	\$3,978,413	\$-	\$27,098,474
Inter-segment	-	-	-	-	-
Total revenue	\$21,197,204	\$1,922,857	\$3,978,413	\$-	\$27,098,474
Segment income (loss)	\$445,677	\$(231,593)	\$715,359	\$-	\$929,443

Details of assets and liabilities under the Group's operating segments are as follows:

Segment assets	IC Substrate (NT\$'000)	PCB (NT\$'000)	Optics (NT\$'000)	Elimination (NT\$'000)	Consolidated (NT\$'000)
As of 12/31/2021	\$47,552,182	\$2,269,050	\$8,564,916	\$-	\$58,386,148
As of 12/31/2020	\$34,046,545	\$2,321,376	\$6,416,031	\$-	\$42,783,952

	IC Substrate	PCB	Optics	Elimination	Consolidated
Segment liabilities	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)	(NT\$'000)
As of 12/31/2021	\$20,284,213	\$2,056,408	\$3,056,429	\$-	\$25,397,050
As of 12/31/2020	\$10,160,915	\$1,613,162	\$1,820,316	\$-	\$13,594,393

(2)Geographical information

Revenues from external customers

		For the year ended December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Taiwan	\$12,538,890	\$9,847,916
Other countries	23,133,873	17,250,558
Total	\$35,672,763	\$27,098,474

The revenue information above is based on the location of the customers.

Non-current assets

		As of December 31,
	2021	2020
	(NT\$'000)	(NT\$'000)
Taiwan	\$29,168,816	\$18,104,382
U.S.A.	3,391	1,221
China	2,297,610	2,514,751
Japan	1,164	635
Total	\$31,470,981	\$20,620,989

(3)Information about major customers

Individual customer's sale accounted for at least 10% of consolidated net sale:

	For the year ended December 31,
Name of customers	2021	2020
Customer A	\$3,837,888	\$2,771,716

Kinsus Interconnect Technology Corp. and Subsidiaries

Endorsement/Guarantee Provided to Others

For the Year Ended December 31, 2021

Attachment 1

(In Thousands of Foreign Currency / New Taiwan Dollars)

	Endorsement/ Guarantee Provider		Guaranteed Party					Amount of	Ratio of Accumulated	Maximum
No.					Maximum			Endorsement /Guarantee	Endorsement/ Guarantee to Net	Endorsement/ Guarantee	Endorsement provided by	Endorsement provided by	Endorsement provided to
			Nature of	Limits on Endorsement/ Guarantee Amount	Balance for the		Amount	secured by	Worth per Latest	Amount	parent company	subsidiaries to	entities in
(Note 1)	Name	Name	Relationship	Provided to Each Guaranteed Party	Period	Ending Balance	Actually Drawn	Properties	Financial Statements	Allowed	to subsidiaries	parent company	China
-	-	-	-	-	\$-	\$-	\$-	\$-	-%	-	-	-	-

Note 1: Kinsus Interconnect Technology Corp. is coded "0".

Note 2: Amounts in foreign currencies are converted to New Taiwan Dollars using the exchange rates as of the balance sheet date.

Note 3: The endorsement and guaranteed amount of the Company and the consolidated subsidiary is NT\$136,932 thousand.

Kinsus Interconnect Technology Corp. and Subsidiaries

Marketable Securities Held (Excluding Investments in Subsidiaries, Associates and Joint Ventures)

As of December 31, 2021

Attachment 2

(In Thousands of New Taiwan Dollars)

				As of December 31, 2021
Name of Held		Relationship with			Carrying	Shareholding
Company	Type and Name of Marketable Securities	the Issuer	Financial Statement Account	Shares / Units	Amount	%	Fair Value	Note
Kinsus Interconnect	Money market funds:
Technology Corp.	Mega Diamond Money Market Fund	-	Financial assets at fair value through profit or loss	21,355,432	\$257,509	-%	\$270,736
	Jih Sun Money Market	-	Financial assets at fair value through profit or loss	17,776,549	255,443	-%	266,419
	Subtotal				512,952		\$537,155
	Add: Valuation adjustments of financial
	assets at fair value through profit or loss				24,203
	Total				\$537,155

Kinsus Interconnect Technology Corp. and Subsidiaries

Acquisition of Individual Real Estate with Amount of at Least NT\$ 300 million or 20% of the Paid-in Capital

For the Year Ended December 31, 2021

Attachment 3

(In Thousands of New Taiwan Dollars)

							Prior Transaction of Related Counter-party
Acquiring Company	Name of Property	Transaction Date	Transaction Amount	Payment Status	Counter-party	Relationship	Owner	Relationship with the Company	Transfer Date	Amount	Price Reference	Purpose and Use of Acquisition	Other Terms
	Kinsus Interconnect Land, houses and buildings	2021.02.05	\$4,409,385	By Contract	WINTEK	None	None	None	None	None	By Bidding	For production capacity expansion	None
Technology Corp.					CORPORATION							and company operation plan.
	Kinsus Interconnect houses and buildings	2021.10.25、	\$1,536,000	By Contract	Fan Da	None	None	None	None	None	Commercial	For production capacity expansion	None
Technology Corp.		2021.11.10			Construction Co ., Ltd.						negotiation	and company operation plan.

Kinsus Interconnect Technology Corp. and Subsidiaries

Related Party Transactions with Purchase or Sales Amount of At least NT\$ 100 Million or 20% of the Paid-in Capital

For the Year Ended December 31, 2021

Attachment 4

(In Thousands of New Taiwan Dollars)

					Transaction Details		Abnormal Transaction		Notes/ Accounts Payable or Receivable
		Nature of	Purchase/			Payment/ Collection		Payment/
Company Name	Related Party	Relationship	Sale	Amount	% to Total	Term	Unit Price	Collection Term	Ending Balance	% to Total	Note
Kinsus Interconnect Technology Corp.	Kinsus Interconnect Technology Suzhou Corp.	Investee accounted for using equity method indirectly	Purchase	\$3,133,718	25.66%	Payment within 60 days from the end of delivery month	Specs of goods purchased are different from others. Cannot be reasonablely compared.	Other vendors also enjoy payment within 30~90 days from the end of delivery month	Accounts payable \$(611,152)	(25.18)%	Note

Note: Transactions are eliminated when preparing the consolidated financial statements.

Kinsus Interconnect Technology Corp. and Subsidiaries Investees over Whom the Company Exercise Significant Influence or Control Directly or Indirectly (Excluding Investees in Mainland China) English Translation of Consolidated Financial Statements Originally Issued in Chinese As of December 31, 2021

Attachment 5

(In Thousands of Foreign Currency / New Taiwan Dollars) Original Investment Amount Balance as of December 31, 2021 Investor Investee Business Location As of December 31, 2020 As of December 31, 2021 Shares % Carrying Value Note KINSUS CORP. (USA) CA. U.S.A. USD 500 USD 500 500,000 100.00% \$66,944 \$8,359 \$8,359 Note KINSUS HOLDING Samoa Investing activities USD 166,309 USD 166,309 166,308,720 100.00% \$2,378,249 \$329,154 \$311,722 Note (SAMOA) LIMITED (Note 3) Kinsus Investment Co., Ltd. Taoyuan City Investing activities \$1,600,000 \$1,600,000 160,000,000 100.00% \$2,678,046 \$407,075 \$407,075 Note (Note1) (Note1) Kinsus Investment Pegavision Corporation Taoyuan City Manufacturing medical \$252,455 \$252,455 21,233,736 30.33% \$1,664,138 \$1,248,574 \$378,741 Note Co., Ltd. equipment (Note 2) (Note 2) Kinsus Investment FuYang Technology Corp. Hsinchu County Electronic Parts and \$929,422 \$929,422 64,176,872 35.65% \$325,005 \$78,080 \$27,839 Co., Ltd. Components Manufacturing KINSUS HOLDING KINSUS HOLDING Cayman Islands Investing activities USD 72,000 USD 72,000 72,000,000 100.00% USD 83,702 USD 20,551 USD 20,551 Note (SAMOA) LIMITED (CAYMAN) LIMITED KINSUS HOLDING PIOTEK HOLDINGS Cayman Islands Investing activities USD 94,309 USD 94,309 95,755,000 51.00% USD 2,838 USD (17,244) USD (8,795) Note (SAMOA) LIMITED LTD. (CAYMAN) PIOTEK HOLDINGS PIOTEK HOLDING British Virgin Investing activities USD 139,841 USD 139,841 139,840,790 100.00% USD 5,564 USD (17,244) USD (17,244) Note LTD. (CAYMAN) LIMITED Islands PIOTEK HOLDING PIOTEK (H.K.) Hong Kong Trading activities USD 26 USD 26 200,000 100.00% USD 2,338 USD (199) USD (199) Note LIMITED TRADING LIMITED Pegavision Corporation PEGAVISION JAPAN INC. JAPAN Selling Medical JPY 9,900 JPY 9,900 198 100.00% \$59,801 \$21,135 \$21,135 Note facility Pegavision Corporation BeautyTech Platform Taoyuan City Selling Medical \$40,000 \$- - -% \$- \$18,766 \$(26,011) Note Corporation facility (Note 4) (Note 4) Pegavision Corporation Mayin Investment Co., Ltd. Taoyuan City Investing activities \$- \$120,003 12,000,000 100.00% \$164,344 \$44,525 \$44,525 Note Mayin Investment Co., Ltd. BeautyTech Platform Taoyuan City Selling Medical \$- \$40,000 4,000,000 100.00% \$56,036 \$18,766 \$44,777 Note Corporation facility (Note 4) Mayin Investment Co., Ltd. FacialBeau International Taiwan Selling Cosmetic \$- \$27,500 2,750,000 55.00% \$27,331 \$(307) \$(169) Note Corporation products BeautyTech Platform Aquamax Vision Corporation U.S.A. Selling Medical USD 600 USD 1,100 11,000,000 100.00% \$12,346 \$(16,325) \$(16,325) Note Corporation facility Kinsus Interconnect Technology Corp. Designing substrates, formulating marketing strategy analysis, developing new customers, researching and development new product technology Kinsus Interconnect Technology Corp. Kinsus Interconnect Technology Corp. Main Business and Product Net Income (Loss) of the Investee Share of Income (Loss) of the Investee

Note : Transactions are eliminated when preparing the consolidated financial statements.

Note 1: The Company's original investment in Kinsus Investment Co., Ltd. was NT\$500,000 thousand. Kinsus Investment Co., Ltd. reduced capital by NT\$102,000 thousand to offset deficits in 2013

And increased capital by NT\$602,000 thousand and NT\$600,000 thousand in 2016 and 2017, respectively. After the increases, the Company's investment amount increased to NT\$1,600,000 thousand.

Note 2: Kinsus Investment Co., Ltd. invested Pegavision Corporation in cost of NT\$286,418 thousand.

As Pegevision Corporation has become a listed company since October, 2019, Kinsus Investment Co., Ltd decreased its investment by NT\$33,963 thousand in selling 855 thousand shares.

Note 3: It includes the investment income accounted for using equity method of 329,154 thousand and the unrealized benefits on upstream transactions of 17,432 thousand.

Note 4: To improve the synergy of the Group, the equity of BeautyTech Platform Corporation was transferred to Mayin Investment Co. , Ltd. from Pegavision Corporation.

Kinsus Interconnect Technology Corp. and Subsidiaries

Marketable Securities Held (Excluding Investments in Subsidiaries, Associates and Joint Ventures)

As of December 31, 2021

Attachment 6

(In Thousands of New Taiwan Dollars)

				As of December 31, 2021			Guarantee, Pledge or Other Restricted Conditions
	Type and Name of Marketable	Relationship with the	Financial Statement	Shares	Carrying				Carrying
Name of Held Company	Securities	Issuer	Account	(Unit)	Amount	%	Fair Value	Shares	Amount	Note
Kinsus Investment Co., Ltd.	Money market funds:
	Taishin Ta Chong Money Market Fund	-	Financial assets at fair value through profit or loss	829,070	\$11,314	-%	\$11,897	-	\$-
	Valuation adjustments of financial assets held for trading				583
	Total				\$11,897
Pegavision Corporation	Money market funds:
	FSITC Taiwan Money Market	-	Financial assets at fair	3,556,527	\$55,012	-%	\$55,024	-	\$-
	Valuation adjustments of financial assets held for trading		value through profit or loss		12
	Total				\$55,024
Mayin Investment Co., Ltd.	Money market funds:
	Mega Diamond Money Market Fund Valuation adjustments of financial assets held for trading	-	Financial assets at fair value through profit or loss	946,873	\$12,000 4	-%	\$12,004	-	\$-
	Total				\$12,004
Kinsus Investment Co., Ltd.	Stocks:
	Ethos Original Co., Ltd.	-	Measured at fair value through other	5,000,000	\$50,000	7.49%	\$50,000	-	\$-
	Li Chang Finery Inc	-	comprehensive income Measured at fair value through other	32,653	1,000	1.01%	1,000	-	-
	Total		comprehensive income		\$51,000		\$51,000		\$-

Kinsus Interconnect Technology Corp. and Subsidiaries

Individual Securities acquired or disposed of with accumulated amount of at least NT\$300 Million or 20% of The Paid-In Capital

For the Year Ended December 31, 2021

Attachment 7

(In Thousands of New Taiwan Dollars)

		Financial Statement		Nature of		Beginning Balance	Acquisition		Disposal					Ending Balance
Company Name	Type and Name of Marketable Securities	Account	Counter-party	Relationship	Shares/Units	Amount	Shares/Units	Amount	Shares/Units	Amount	Carrying Value	Gain/Loss on Disposal	Shares/Units	Amount
Pegavision Corporation Money Market Fund:
	Yuanta Wan Tai Money Market Fund Financial assets at fair value		-	-	33,387,513	\$509,270	28,763,573	\$439,000	62,151,086	\$948,577	\$948,270	\$307	-	\$-
		through profit or loss

Kinsus Interconnect Technology Corp. and Subsidiaries

Related Party Transactions with Purchase or Sales Amount of At least NT\$100 Million or 20% of the Paid-in Capital

For the Year Ended December 31, 2021

Attachment 8

(In Thousands of US/NTD Dollars)

					Transaction Details		Abnormal Transaction		Notes/Accounts Payable or Receivable
Company Name	Related Party	Nature of Relationship	Purchase/ Sale	Amount	% to Total	Payment/ Collection Term	Unit Price	Payment/ Collection Term	Ending Balance	% to Total	Note
Kinsus Interconnect Technology Suzhou Corp. Technology Corp.	Kinsus Interconnect	Parent company	Sales	USD 112,115	84.85%	Payment within 60 days from the end of delivery month	Specs of goods sold are different from others. Cannot be reasonably compared.	No non-related parties to be compared with.	Accounts receivable USD 22,901	86.20%	Note
Piotek Computer (Suzhou) Co., Ltd.	Piotek (H.K.) Trading Limited	Also a subsidiary under the Company's control	Sales	USD 4,685	5.61%	Payment within 60 days from the end of delivery month	Specs of goods sold are different from others. Cannot be reasonably compared.	No non-related parties to be compared with.	Accounts receivable USD 259	1.07%	Note
Pegavision Corporation	Pegavision Japan Inc.	Also a subsidiary under the Company's control	Sales	\$1,850,825	35.85%	Payment within 90 days from the end of delivery month	Similar to those to third party customers.	Payment within 90 days from telegraphic transfer.	Accounts receivable \$301,885 Contract liability \$(18,222)	35.20% 75.93%	Note
Pegavision Corporation	BeautyTech Platform Corporation	Also a subsidiary under the Company's control	Sales	\$411,064	7.96%	Payment within 120 days from the end of delivery month	Similar to those to third party customers.	Payment within 90 days from telegraphic transfer.	Accounts receivable \$139,387	16.25%	Note
Pegavision Corporation	Gemvision Technology (Zhejiang) Limited	Also a subsidiary under the Company's control	Sales	\$211,692	4.10%	Payment within 180 days from the end of delivery month	Similar to those to third party customers.	Payment within 90 days from telegraphic transfer.	Accounts receivable \$85,662	9.99%	Note

Note: Transactions are eliminated when preparing the consolidated financial statements.

Kinsus Interconnect Technology Corp. and Subsidiaries

Receivables from Related Parties of at Least NT\$ 100 Million or 20% of the Paid-in Capital

As of December 31, 2021

Attachment 9

Company Name	Related Party	Nature of Relationship	Ending Balance	Turnover Ratio	Amount	Overdue Action Taken	Amount Received in Subsequent Periods	Loss Allowance
Kinsus Interconnect	Kinsus Interconnect	Parent company	USD 22,901	6.98	\$-	-	\$-	\$-
Technology Suzhou	Technology Corp.		(Note and Note 1 )
Corp.
Pegavision Corporation	Pegavision Japan Inc.	Subsidiary	\$301,885 (Note and Note 1 )	5.64	\$-	-	\$-	\$-
Pegavision Corporation	BeautyTech Platform Corporation	Subsidiary	\$139,387 (Note and Note 1 )	5.82	\$-	-	\$-	\$-

(In Thousands of US / NTD Dollars)

Note: Accounts receivable.

Note 1: Transactions are eliminated when preparing the consolidated financial statements.

Kinsus Interconnect Technology Corp. and Subsidiaries

Intercompany Relationships and Significant Intercompany Transactions for the Year Ended December 31, 2021

Attachment 10

(In Thousands of Foreign Currency / New Taiwan Dollars)

No.				Intercompany Transaction
(Note 1)	Company Name	Counter-Party	Nature of Relationship (Note 2)	Financial Statement Account	Amount	Terms	Percentage to Consolidated Net Revenue or Total Assets (Note 3)
	2021.01.01~2021.12.31
0	Kinsus Interconnect Technology Corp. KINSUS CORP. (USA)		1	Accrued expense		\$3,002 Payment within 30 days from the end of delivery month by TT	0.01%
0		Kinsus Interconnect Technology Corp. Kinsus Interconnect Technology Suzhou Corp.	1	Accounts receivable		\$10,177 Payment within 30 days from the end of delivery month	0.02%
0		Kinsus Interconnect Technology Corp. Kinsus Interconnect Technology Suzhou Corp.	1	Accounts payable		\$611,152 Payment within 60 days from the end of delivery month	1.05%
0		Kinsus Interconnect Technology Corp. Kinsus Interconnect Technology Suzhou Corp.	1	Other receivables	\$17,993	-	0.03%
0		Kinsus Interconnect Technology Corp. Kinsus Interconnect Technology Suzhou Corp.	1	Purchase		\$3,133,718 Payment within 60 days from the end of delivery month	8.78%
0	Kinsus Interconnect Technology Corp. KINSUS CORP. (USA)		1	Commission expense		\$38,793 Payment within 30 days from the end of delivery month by TT	0.11%
0		Kinsus Interconnect Technology Corp. Kinsus Interconnect Technology Suzhou Corp.	1	Sales revenue		\$60,826 Payment within 30 days from the end of delivery month	0.17%
0		Kinsus Interconnect Technology Corp. Kinsus Interconnect Technology Suzhou Corp.	1	Other income	\$8,004	-	0.02%
0	Kinsus Interconnect Technology Corp. Piotek Computer (Suzhou) Co., Ltd.		1	Other income	\$168	-	-%
0		Kinsus Interconnect Technology Corp. PIOTEK (H.K.) TRADING LIMITED	1	Other income	\$315	-	-%
0	Kinsus Interconnect Technology Corp. Aquamax Corporation		1	Prepaid expense	\$60	-	-%
1	Piotek Computer (Suzhou) Co., Ltd.	PIOTEK (H.K.) TRADING LIMITED	3	Sales revenue		USD 4,685 Payment within 60~90 days from the end of delivery month	0.36%
1	Piotek Computer (Suzhou) Co., Ltd.	PIOTEK (H.K.) TRADING LIMITED	3	Accounts receivable		USD 259 Payment within 60~90 days from the end of delivery month	0.01%
1	Piotek Computer (Suzhou) Co., Ltd.	Xiang-Shuo (Suzhou) Trading Limited	3	Payable to equipment suppliers	USD 2	-	-%
1	Piotek Computer (Suzhou) Co., Ltd.	Kinsus Interconnect Technology Suzhou Corp.	3	Other receivables		RMB 65 Payment within 60~90 days from the end of delivery month	-%
1	Piotek Computer (Suzhou) Co., Ltd.	Kinsus Interconnect Technology Suzhou Corp.	3	Sales revenue		RMB 87 Payment within 60~90 days from the end of delivery month	-%
1	Piotek Computer (Suzhou) Co., Ltd.	Kinsus Interconnect Technology Suzhou Corp.	3	Other income		RMB 14 Payment within 60~90 days from the end of delivery month	-%

Kinsus Interconnect Technology Corp. and Subsidiaries

Intercompany Relationships and Significant Intercompany Transactions for the Year Ended December 31, 2021

Attachment 10

						(In Thousands of Foreign Currency / New Taiwan Dollars)
No.						Intercompany Transaction	Percentage to
			Nature of				Consolidated Net
			Relationship				Revenue or Total
(Note 1)	Company Name	Counter-Party	(Note 2)	Financial Statement Account	Amount	Terms	Assets (Note 3)
1	Piotek Computer (Suzhou) Co., Ltd.	Kinsus Interconnect Technology Suzhou Corp.	3	Purchase		RMB 34 Payment within 60~90 days from the end of delivery month	-%
2	Pegavision Corporation	Pegavision Japan Inc.	3	Sales revenue		\$1,850,825 Payment within 90 days from the end of delivery month	5.19%
2	Pegavision Corporation	Pegavision Japan Inc.	3	Accounts receivable		\$301,885 Payment within 90 days from the end of delivery month	0.52%
2	Pegavision Corporation	Pegavision Japan Inc.	3	Contract liability	\$18,222	-	0.03%
2	Pegavision Corporation	Pegavision Japan Inc.	3	Other payables	\$34	-	-%
2	Pegavision Corporation	PEGAVISION CONTACT LENSES (SHANGHAI) CORPORATION	3	Sales revenue		\$40,036 Payment within 180 days from the end of delivery month	0.11%
2	Pegavision Corporation	Gemvision Technology (Zhejiang) Limited	3	Sales revenue		\$211,692 Payment within 180 days from the end of delivery month	0.59%
2	Pegavision Corporation	Gemvision Technology (Zhejiang) Limited	3	Accounts receivable		\$85,662 Payment within 180 days from the end of delivery month	0.15%
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Sales revenue		\$411,064 Payment within 120 days from the end of delivery month	1.15%
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Other operating income		\$114,380 Payment within 120 days from the end of delivery month	0.32%
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Operating expense		\$16,357 Payment within 120 days from the end of delivery month	0.05%
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Rent revenue		\$10,881 Payment within 120 days from the end of delivery month	0.03%
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Other income		\$3 Payment within 120 days from the end of delivery month	-%
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Accounts receivable		\$139,387 Payment within 120 days from the end of delivery month	0.24%
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Other receivables		\$328 Payment within 120 days from the end of delivery month	-%
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Other payables		\$18,848 30 days after monthly closing	0.03%

Kinsus Interconnect Technology Corp. and Subsidiaries

Intercompany Relationships and Significant Intercompany Transactions for the Year Ended December 31, 2021

Attachment 10

(In Thousands of Foreign Currency / New Taiwan Dollars)

No.				Intercompany Transaction
			Nature of Relationship				Percentage to Consolidated Net Revenue or Total
(Note 1)	Company Name	Counter-Party	(Note 2)	Financial Statement Account	Amount	Terms	Assets (Note 3)
2	Pegavision Corporation	BeautyTech Platform Corporation	3	Deposits received	\$4	-	-%
2	Pegavision Corporation	Aquamax Vision Corporation	3	Sales revenue		\$11,234 Payment within 120 days from the end of delivery month	0.03%
2	Pegavision Corporation	Aquamax Vision Corporation	3	Accounts receivable		\$11,250 Payment within 120 days from the end of delivery month	0.02%
2	Pegavision Corporation	Pegavision (jiangsu) Limited	3	Operating expense		\$2,456 Payment within 120 days from the end of delivery month	0.01%
3	BeautyTech Platform Corporation	Aquamax Vision Corporation	3	Sales revenue		\$453 Payment within 120 days from the end of delivery month	-%
3	BeautyTech Platform Corporation	Aquamax Vision Corporation	3	Accounts receivable		\$453 Payment within 120 days from the end of delivery month	-%
4	PEGAVISION CONTACT LENSES (SHANGHAI) CORPORATION	Gemvision Technology (Zhejiang) Limited	3	Other operating income		\$29,609 Payment within 180 days from the end of delivery month	0.08%
4	PEGAVISION CONTACT LENSES (SHANGHAI) CORPORATION	Gemvision Technology (Zhejiang) Limited	3	Accounts receivable		\$2,547 Payment within 180 days from the end of delivery month	-%

Note 1: Transaction information between Parent company and its subsidiaries should be disclosed by codes below:

(1) Parent company is coded "0".

(2) The subsidiaries are coded from "1" in the order presented in the table above.

Note 2: Relationship are divided into the following three types and the types are required to be indicated:

(1) From the parent company to a subsidiary.

(2) From a subsidiary to the parent company.

(3) Between subsidiaries.

Note 3: Regarding the percentage of transaction amount to consolidated operating revenues or total assets, it is computed based on the ending balance to consolidated total assets for balance sheet items; and based on interim accumulated amount to consolidated net revenue for income statement items.

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KINSUS — Annual Report 2021

52304_rns_2021-11-11_f8b0bdf6-e94c-4e47-8668-cdd0786f4ff6.pdf

English Translation of Financial Statements and a Report Originally Issued in Chinese

Consolidated Financial Statements

MANAGEMENT REPRESENTATION LETTER

English Translation of Consolidated Financial Statements Originally Issued in Chinese Kinsus Interconnect Technology Corp. and Subsidiaries Consolidated Balance Sheets As of December 31, 2021 and 2020

English Translation of Consolidated Financial Statements Originally Issued in Chinese Kinsus Interconnect Technology Corp. and Subsidiaries Consolidated Balance Sheets-(Continued) As of December 31, 2021 and 2020 (Amounts Expressed In Thousands of New Taiwan Dollars)

1. HISTORY AND ORGANIZATION

2. DATE AND PROCEDURE OF AUTHORIZATION FOR FINANCIAL STATEMENTS ISSUANCE

3. NEWLY ISSUED OR REVISED STANDARDS AND INTERPRETATIONS

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Preparation principle of consolidated financial statements

Financial asset measured at fair value through other comprehensive income

Financial asset measured at fair value through profit or loss

Classification between liabilities or equity

Equity instruments

Financial liabilities

Financial liabilities at amortized cost

Derecognition of financial liabilities

(13)Leases

Group as a lessee

Group as a lessor

(14)Intangible assets

(16)Provisions

(17)Revenue recognition

Sale of goods

(18)Borrowing costs

(19)Government grants

(22)Income tax

Current income tax

Deferred income tax

5. SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS

(1) Judgement

G. Income tax

6. CONTENTS OF SIGNIFICANT ACCOUNTS

(6)Accounts receivable and accounts receivable - related parties, net

A.Accounts receivable, net

(7)Inventories

(8) Investments accounted for under the equity method

B. Investments in associates

(11)Other non-current assets

(12)Short-term loans

(13)Other payable

(14)Other current liabilities

(15)Refund liability

(16)Long-term loans

(18)Post-employment benefits

Defined contribution plan

Defined benefits plan

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp.

Sensitivity analysis

(19)Equity

A. Common stock

B. Capital surplus

C. Treasury stock

(b)Dividend policies

(c)Legal reserve

(d)Special reserve

(20)Share-based payment plans

(21)Sales

A. Disaggregation of revenue

B. Contract balances

(a)Contract liabilities

December 31, 2021

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

A. Group as a lessee

(a) Amounts recognized in the balance sheet

I. Right-of-use assets

II. Lease liability

(25)Non-operating incomes and expenses

C. Other gains and losses

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

D. Finance costs

Income tax expense (benefit) recognized in profit or loss

C. Deferred tax assets (liabilities) relate to the following:

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese Kinsus Interconnect Technology Corp. Notes to Consolidated Financial Statements (Continued)

For the year ended December 31, 2020

(28)Earnings per share

B. Diluted earnings per share

KINSUS Annual Report 2021