LILYTEXTILE - Annual Report 2022 | FinancialReports.eu

Stock ID: 1443

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Lily Logistics Development Co., LTD. (Previous Name LILY TEXTILE CO., LTD)

2022

Annual Report

Market Observation Post System (MOPs): http://mops.twse.com.tw

Company Website: http://WWW.LILY.COM.TW

Published on: May 18, 2023

I. Name of the Company Spokesperson, Title, and Contact Number

Spokesperson: Chairman SU TUNG YUNG Tel:(02)2555-7680 Spokesperson: Associate WANG CHIEN CHUNG Tel:(02)2559-8230

E-mall:[email protected]

II. Address and Contact Number of the Head Office, Taipei Office, and Logistics Warehouse Centers: Head Office: No. 65, Sec. 1, Shuangfu Rd., Pingzhen Dist., Taoyuan City, Taiwan (R.O.C.) (TEL):(03)490-8690 (FAX):(03)490-8650 Taipei Office: 6F., No. 70, Xining N. Rd., Datong Dist., Taipei City, Taiwan (R.O.C.) (TEL):(02)2555-7680 (FAX):(02)2558-7492 Yangmei Logistics Warehouse Center: No. 199, Sec. 1, Zhongshan N. Rd., Yangmei Dist., Taoyuan City, Taiwan (R.O.C.) (TEL):(03)478-7144 (FAX):(03)478-7145 Pingzhen Logistics Warehouse Center: No. 65, Sec. 1, Shuangfu Rd., Pingzhen Dist., Taoyuan City, Taiwan (R.O.C.) (TEL):(03)490-8690 (FAX):(03)490-8650 Nankan Logistics Warehouse Center: No. 313, Sec. 2, Nanshan Rd., Luzhu Dist., Taoyuan City, Taiwan (R.O.C.) (TEL):(03)324-6606 (FAX):(03)324-6603 III. Name of Share Registrar, Address, and Contact Number

MasterLink Securities Corp. Stock Transfer Agency Address: B1F., No. 35, Ln. 11, Guangfu N. Rd., Songshan Dist., Taipei City, Taiwan (R.O.C.) Tel: (02)2768-6668 Website: www.masterlink.com.tw/stock/index.htm

IV. Name of CPAs, Accounting Firm, Address, and Contact Number for the Most Recent Financial Report CPAs: CHEN KUEI MEI, WANG WU CHANG Accounting Firm: Crowe (TW) CPAs Address: 10F., No. 369, Fuxing N. Rd., Zhongshan Dist., Taipei City, Taiwan (R.O.C.) Tel: (02)8770-5181

V. Name of any exchanges where the company's securities are traded offshore, and the method by which to access information on said offshore securities: Not applicable

VI. Company Website: http://WWW.LILY.COM.TW

I. Letter to Shareholders ........................................................................................................ 1 II. Company Profile ................................................................................................................. 3 2.1 Date of Incorporation .................................................................................................. 3 2.2 Company History ........................................................................................................ 4 III. Corporate Governance Report ........................................................................................ 5 3.1 Organization ................................................................................................................ 5 3.2 Directors, Supervisors and Management Team .......................................................... 6 3.3 Remuneration of Directors, Supervisors, General Manager, and Assistant General Manager in the Past Year .............................................................................. 9 3.4 Corporate Governance Status .................................................................................... 15 3.5 Accountant Fees ........................................................................................................ 31 3.6 When the Securities Firm Changes Its Accounting Firm and the Audit Fees Paid For the Financial Year in which the Change Took Place are Lower than Those Paid For the Financial Year Immediately Preceding the Change, the Amount of the Audit Fees Before and After the Change and the Reason Shall Be Disclosed ... 32 3.7 Change of Accountants ............................................................................................. 32 3.8 The Employment of the Company’s Chairman, General Manager, Financial or Accounting Manager with the Firm of the Auditing CPA or Its Affiliated Businesses in the Past Year ....................................................................................... 33 3.9 Particulars about Changes in Shareholding and Equity Pledge of Directors, Supervisors, Managers and Shareholders Holding More Than 10% of the Company’s Shares in the Past Year and as of the Date of Publication of the Annual Report ........................................................................................................... 33 3.10 Relationship Information, If Any of the 10 Largest Shareholders is a Related Party as Defined in Statement of Financial Accounting Standards No. 6, or Spouse, or Relative Within the Second Degree of Kinship .................................... 34 3.11 The Total Number of Shares and Total Equity Stake Held in Any Single Enterprise By the Company, Its Directors and Supervisors, Managerial Officers, and Any Companies Controlled Either Directly or Indirectly By the Company ................... 35 IV. Capital Overview ............................................................................................................ 36 4.1 Capital and Shares ..................................................................................................... 36 4.2 Buyback of Treasury Stock ....................................................................................... 40 4.3 Corporate Bonds ........................................................................................................ 40 4.4 Information about Convertible Bond ........................................................................ 40 4.5 Information about Exchangeable Bond ..................................................................... 40 4.6 Shelf Registration for Issuance of Corporate Bonds ................................................. 40 4.7 Information about Corporate Bonds with Warrants .................................................. 40 4.8 Preferred Shares ........................................................................................................ 40 4.9 Information about Preferred Shares with Warrants ................................................... 40 4.10 Overseas Depositary Receipts ................................................................................. 40 4.11 Employee Stock Options ......................................................................................... 40 4.12 New Restricted Employee Shares ........................................................................... 40 4.13 Names and Acquisition and Subscription Status of Managerial Officers Who Have Acquired Employee Share Subscription Warrants and the Top Ten Employees (Ranked by the Number of Subscibable Shares) Who Have

Acquired Share Subscription Warrants .................................................................. 40 4.14 Basic Information on Companies That Are Merged or Acquired or Whose Shares Are Acquired by the Company .................................................................... 40 4.15 Financing Plans and Implementation ...................................................................... 40 V. Operational Highlights ................................................................................................... 41 5.1 Business Activities .................................................................................................... 41 5.2 Market and Sales Overview ...................................................................................... 41 5.3 Employee Information ............................................................................................... 44 5.4 Environmental Expenditure Status ............................................................................ 45 5.5 Collective Bargaining Agreement Status .................................................................. 45 5.6 Important Contracts ................................................................................................... 45 VI. Financial Information ..................................................................................................... 46 6.1 Condensed Balance Sheet, Income Statement and Audit Report of Independent Accountants in the Past Five Years ........................................................................... 46 6.2 Five-Year Financial Analysis .................................................................................... 49 6.3 Supervisors’ Review Report of the Latest Financial Report ..................................... 51 6.4 Financial Report of the Past Year ............................................................................. 52 6.5 The Company’s Individual Financial Statement for the Most Recent Fiscal Year, Audited and Attested by CPAs ................................................................................ 128 6.6 If the Company and Its Affiliates Encounter Any Financial Difficulties in the Past Year and as of the Date of Publication of the Annual Report, the Impact on the Company's Financial Status Shall Be Listed ..................................................... 195 VII. Review of Financial Conditions, Operating Results, and Risk Management ........ 196 7.1 Analysis of Financial Status .................................................................................... 197 7.2 Analysis of Operation Results ................................................................................. 197 7.3 Analysis of Cash Flow ............................................................................................ 198 7.4 Impact of Major Capital Expenditure in the Past Year on the Financial Status ...... 198 7.5 Reinvestment Policy in the Past Year, the Main Reason for Its Profit or Loss, the Improvement Plan and Investment Plan in the Next Year ............................... 199 7.6 Analysis of Risk Management ................................................................................ 200 7.7 Other Important Matters .......................................................................................... 200 VIII. Special Disclosure ...................................................................................................... 201 8.1 Information about the Company’s Affiliates .......................................................... 201 8.2 Private Securities in the Past Year and as of the Date of Publication of the Annual Report ......................................................................................................... 201 8.3 Holding or Disposal of the Company’s Shares by Affiliates in the Past Year and as of the Date of Publication of the Annual Report ............................................... 201 8.4 Other Necessary Supplementary Notes ................................................................... 201 IX. Matters in the Past Year and as of the Publication of the Annual Report Which Have a Substantial Impact on Owner’s Equity as Stipulated in Item 2, Paragraph 2 of Article 36 of the Securities Exchange Law ................................ 201

I. Letter to Shareholders Dear Shareholders,

Today marks the 2023 Annual General Shareholders’ Meeting of Lily Logistics Development Co., LTD., which is also the first meeting since the renaming of the Company. We would like to extend our gratitude to all shareholders who have traveled to attend this meeting.

Now, we will present a report on the Company’s performance during the fiscal year 2022 as well as providing an outlook for the up-coming year.

1. The results of implementation of the 2022 business plan:

The Company’s consolidated financial statements for 2022 show a net operating revenue of NT$847.5 million, operating costs of NT$514.43 million, operating net profit of NT$245.83 million, and net profit after tax of NT$143.01 million.

Regarding Kunshan Lily Textile Co., the company is still mainly engaged in factory rental business. Due to the impact of the pandemic, combined with the provision for exchange losses and unsatisfactory factory rental, the Company recorded a net loss after tax of RMB$ 44.11 million in 2022.

As for the warehousing and logistics business, in addition to the construction of the two new warehouse buildings in Pingzhen District that have come into operation, the construction of the third phase of the warehouse building started in October 2022, and everything is proceeding according to plan.

2. Budget implementation

According to the “Regulations Governing the Publication of Financial Forecasts of Public Companies”, the Company has not announced the financial forecasts for year 2022, therefore is not required to disclose the budget implementation status.

Financial Revenue, Expenditure, and profitability analysis

		Unit: NT$ thousands 2021 2022 866,817 847,500 257,020 346,069 204,134 143,013 4.86 3.64 20.74 17.36 15.66 10.82 23.54 16.87 1.65 1.67	Unit: NT$ thousands 2021 2022 866,817 847,500 257,020 346,069 204,134 143,013 4.86 3.64 20.74 17.36 15.66 10.82 23.54 16.87 1.65 1.67
	Item	2021	2022
Financial Revenue and Expenditure	Operating revenue	866,817	847,500
	Operating margin	257,020	346,069
	Net profit after tax	204,134	143,013
Profitability Analysis	Return on assets (%)	4.86	3.64
	Return on equity (%)	20.74	17.36
	Ratio of pre-tax net profit to paid-up capital (%)	15.66	10.82
	Net profit ratio (%)	23.54	16.87
	Earnings per share (NT$)	1.65	1.67

4. Research and development analysis

No research and development expenses in the most recent two fiscal years.

5. Business Plan for 2023

(1) Business Objectives:

The global pandemic outbreak has gradually subsided in 2023, and the economy is slowly recovering. Due to the rise of the home economy, people have become accustomed to purchasing goods through home delivery, resulting in a growing demand for the delivery and logistics industry. In addition to strengthening services to existing customers, the Company is actively developing new customer bases. Besides the new warehouse building in the Yangmei Logistics Warehouse Center, which is scheduled to

start operations in 2023, the Company is also constructing the third phase of the warehouse building in Pingzhen District, which is expected to start operations in the first half of 2025. Based on the above reasons, the Company believes that its earnings will increase year by year as the new buildings come into operation.

(2) Development Strategy:
- <1>Under borderless procurement, the storage, handling, and distribution of goods are necessary, creating favorable conditions for logistics development.
- <2>By providing staff training, we aim to enhance their technical skills and productivity.
- <3>Maintaining high-quality services as well as lowering the unit production cost.
- <4>The Company maintains a stable financial policy and structure.
- <5>Our service portfolio is customer-oriented, with the aim of maximizing our operating profit by remaining flexible and adjusting to meet their need.
(3) The impact of the external competitive environment, regulatory environment and overall business environment:
- The Company is currently primarily engaged in operating logistics and warehousing businesses. In addition to keeping abreast of changes in market demand and preparing financial reports in compliance with new regulations issued by the regulatory authorities, the Company also requires its business partners and products to comply with domestic and international environmental protection laws and regulations, thereby gradually enhancing the Company’s overall competitiveness.

Sincerely yours,

Chairman

II. Company Profile

2.1 Company Profile:

2.1.1 Establishment Date:

Founded on November 25, 1972.

2.1.2 Address and Contact Number of the Head Office, Taipei Office and Logistics Warehouse Centers: Head office: No. 65, Sec. 1, Shuangfu Rd., Pingzhen Dist., Taoyuan City, Taiwan (R.O.C.) Tel: (03)490-8690 Fax: (03)490-8650 Taipei office: 6F., No. 70, Xining N. Rd., Datong Dist., Taipei City, Taiwan (R.O.C.) Tel: (02)2555-7680 Fax: (02)2558-7492 Yangmei Logistics Warehouse Center: No. 199, Sec. 1, Zhongshan N. Rd., Yangmei Dist., Taoyuan City, Taiwan (R.O.C.) Tel: (03)478-7144 Fax: (03)478-7145 Pingzhen Logistics Warehouse Center: No. 65, Sec. 1, Shuangfu Rd., Pingzhen Dist., Taoyuan City, Taiwan (R.O.C.) Tel: (03)490-8690 Fax: (03)490-8650 Nankan Logistics Warehouse Center: No. 313, Sec. 2, Nanshan Rd., Luzhu Dist., Taoyuan City, Taiwan (R.O.C.) Tel: (03)324-6606 Fax: (03)324-6604

2.1.3 Unified Business:
Spinning, weaving, processing, buying, selling, bidding, and agency services for natural cotton, Artificial Fiber, and various chemical fibers.
Commissioning construction contractors to build commercial buildings and national housing for rent or sale, as well as developing industrial zones approved by the industrial supervisory authority.
Processing and selling various vegetables and fruits.
Sales regarding canned foods, coffee, soda, juice, canned drinks, and snacks.
Packaging and refrigeration services for the aforementioned products.
Manufacturing, processing, and selling of prepared frozen foods (including frozen fish, shrimp, and meat).
Leasing service of freezer warehouses.
Import and wholesale of alcoholic drinks.
Processing, importing, and exporting of grain, legumes (such as corn, wheat, barley, oats (buckwheat, naked barley), rice, potatoes, soybeans, etc.) and their by-products, as well as snack foods.
General import and export trade and agency services. (Excluding those that are subject to special approval)
Manufacturing, assembling, installing, contracting, and leasing of various machinery, equipment, materials, parts, and components.
Operating ice manufacturing.
I301010 Software Design Services.
IZ06010 Cargoes Packaging.
I103010 Enterprise Management Consultancy.
G801010 Warehousing.
F102100 Wholesale of Sugar Confectionery.
F102110 Wholesale of Bakery Product.
F102160 Wholesale of Assist Food Products.
F107080 Wholesale of Environmental Agents.
F108040 Wholesale of Cosmetics.
F108060 Wholesale of Second Type Patent Medicine.
F109040 Wholesale of Toys and Recreational Articles.
F110020 Wholesale of Spectacles.
F118010 Wholesale of Computer Software.
F113020 Wholesale of Electrical Appliances.
F113050 Wholesale of Office Machinery and Equipment.
F113110 Wholesale of Batteries.
I103030 Hospital Management Consultancy.
F203010 Retail Sale of Food, Grocery and Beverage.
3 -
F203020 Retail Sale of Tobacco and Alcoholic Drinks.
F207080 Retail Sale of Environmental Agents.
F208040 Retail Sale of Cosmetics.
F208050 Retail Over-the-counter Drugs Class B.
F210020 Retail Sale of Glasses.
F218010 Retail Sale of Computer Software.
F213010 Retail Sale of Electrical Appliances.
F213030 Retail Sale of Office Machinery and Equipment.
F213110 Retail Sale of Batteries.
I301020 Data Processing Services.
I301030 Digital Information Supply Services.
ZZ9999 All business activities that are not prohibited or restricted by law, except those that are subject to special approval.

2.2 Company History:

November 1972:
- Founded on November 1972, with a paid-in capital of NT$ 36,000,000.
February 1990:
- The Company filed for registration of the publicly issued 82,665,652 shares of common stock and received the approval from The Taiwan Stock Exchange Corporation in accordance with “Taiwan Stock Exchange Corporation Rules Governing Review of Securities Listings.” The shares were approved for listing as Class 1 shares once the ownership was sufficiently dispersed. Reported with 29 December 1989 per Letter No. Taiwan-Stock-Listing-78-10856, and approved for recordation 3 February 1990 per Letter No. Taiwan-Stock-Listing-I-00178 of the Securities Management Committee, Ministry of Finance.
February 1993:
- The first conversion of 1,432 corporate bond, amounting to NT$143,200,000, was completed by the end of 1992. The bonds were converted into 4,773,272 shares, with a face value of NT$10 per share, resulting in a total of NT$47,732,720. Approved for recordation 18 February 1993 per Letter No. Taiwan-Stock-Listing-I-84435 of the Securities Management Committee, Ministry of Finance. The registration for the Company’s change was completed on February 18, 1993.
August 1999:
- 14,337,621 shares of common share issue through capitalization of earnings, with a face value of NT$10 per share, resulting in a total of NT$143,376,210. Approved for recordation 30 June 1999 per Letter No. Taiwan-Stock-Listing-I-59365 of the Securities and Futures Commission, Ministry of Finance. The registration for the Company’s change was completed on August 30, 1999.
December 2009:
- Cancelation of 7,317,100 shares of treasury stocks, with a face value of NT$10 per share, resulting in a total of NT$73,171,000. The approval letter, the Letter No. Ministry-of-Economic-Affairs-Commerce-Department-09801295290 received on December 24, 2009. The registration for the Company’s change was completed on the same day.
January 2011:
- Cancelation of 2,508,000 shares of treasury stocks, with a face value of NT$10 per share, resulting in a total of NT$25,080,000. The approval letter, the Letter No. Ministry-of-Economic-Affairs-Commerce-Department-10001006860 received on January 12, 2011. The registration for the Company’s change was completed on the same day.
August 2011:
- To compensate for the loss, the Company carried out a capital reduction by reducing 155,921,931 shares with a face value of NT$10 per share, resulting in a total of NT$1,559,219,310. The approval letter, the Letter No. Ministry-of-Economic-AffairsCommerce-Department-10001180700 received on August 12, 2011. The registration for the Company’s change was completed on the same day.
July 8, 2022:

LILY TEXTILE CO., LTD. was renamed Lily Logistics Development Co., Ltd.

III. Corporate Governance Report

3.1 Organization:

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Shareholders’
Meeting
Board of
Directors
Functional Committees Audit
Chairman
Secretary Office
General
Manager
Logistics Center Management Department
Stock Transfer
Finance Accounting Business Purchasing
Information Management Business Department Pingzhen Logistics Yangmei Logistics Nankan Logistics
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3.2 Directors, General Manager, Deputy General Manager, Associates, Departments and Branches Officer Information 3.2.1 Directors

																	December 31,	December 31,	December 31,	2022
Title Note 1)	Nationality of place of registration	Name	Gender & Age (Note 2)	Date of appoint ment to position	Term of office	Commence ment date of the first term (Note 3)	Shares held when appointed		Shares currently held		Shares he spouse an children	ld by d minor	Shares held through nominees		Principal work experience and academic qualifications (Note 4)	Positions concurrently held in other companies at present	Any person who is t or related within the of kinship to, other officers, directors, o 人		he spouse of, second degree managerial r supervisors	Remarks (Note 5)
							Shares	%	Shares	%	Shares	%	Shares	%			Title	Name	Relationship
Chairman	Taiwan	SU TUNG YUNG	Male, 81~90	06/15/2022	3 years	06/11/2004	5,820,072	4.30%	5,820,072	4.30%	88,020	0.07%	0	0	Chairman of Lily Logistics Development Co., LTD.	Chairman of Gisong Enterprise Corporation	Director	SU TING KUEI	Father-son	None
																	Director	SU TING HUNG	Father-son	None
Director	Taiwan	SU CHIN YUAN	Male, 61~70	06/15/2022	3 years	06/11/2004	6,626,758	4.90%	8,087,958	5.98%	100,000	0.07%	0	0	Tamkang University Department of Business Administration	Chairman of Kunshan Lily Textile Co.	Director	SU PAI HUANG	Brotherhood	None
Director	Taiwan	SU TING KUEI	Male, 41~50	06/15/2022	3 years	06/11/2004	2,739,221	2.02%	2,739,221	2.02%	870,000	0.64%	0	0	California State University, Fullerton	Deputy Chairman of Kunshan Lily Textile Co.	Chairman	SU TUNG YUNG	Father-son	None
																	Director	SU TING HUNG	Brotherhood	None
Director	Taiwan	SU PAI HUANG	Male, 51~60	06/15/2022	3 years	06/13/2016	3,737,510	2.76%	3,737,510	2.76%	53,018	0.04%	0	0	National Chengchi University, Executive Master of Business Administration	General Manager of ZIG SHENG INDUSTRIAL CO., LTD.	Director	SU CHIN YUAN	Brotherhood	None
Director	Taiwan	SU TING HUNG	Male, 41~50	06/15/2022	3 years	06/15/2022	5,228,597	3.86%	5,230,597	3.86%	870,000	0.64%	0	0	Takming University of Science and Technology	Chairman of SUNNY LOGISTICS Co., LTD.	Chairman	SU TUNG YUNG	Father-son	None
																	Director	SU TING KUEI	Brotherhood	None
Director	Taiwan	LU HSUEH TUNG	Male, 61~70	06/15/2022	3 years	06/16/2015	50,665	0.04%	50,665	0.04%	0	0	0	0	Nanya Institute of Technology Department of Textile	None	None			None
Independent Director	Taiwan	SU TING	Male, 71~80	06/15/2022	3 years	06/13/2016	500,536	0.37%	500,536	0.37%	2,439	0	0	0	Manager of ZIG SONG INDUSTRIAL CO., LTD.	None	None			None
Independent Director	Taiwan	CHIEN HUA YUEH	Male, 71~80	06/15/2022	3 years	06/13/2016	0	0	0	0	0	0	0	0	Manager of CARL WIN INTERNATIONAL LTD.	None	None			None
Independent Director	Taiwan	LIEN SANHO	Male, 61~70	06/15/2022	3 years	06/15/2022	0	0	0	0	0	0	0	0	General Manager of Fu Kai Textile Co., LTD	None	None			None

Note 1: For a corporate shareholder, the name of the corporate shareholder and its representative shall be listed separately (when listing the representative of a corporate shareholder, the name of the corporate shareholder shall also be noted), and Form 1 below shall also be completed.

Note 2: Please state the actual age, or, alternatively, state the age interval into which the actual age falls, e.g., 41~50 years, 51~60 years.

Note 3: Specify the time the person first began to serve as a director or supervisor of the Company. If there has been any break within a term or between terms, add a note specifying the circumstances.

Note 4: Specify experience and qualifications related to the current position. If during a period specified above, the person has served in a position at a CPA firm that serves as external auditor/attestor, specify the position held and the duties for which the person was responsible.

Note 5: If the general manager or person of an equivalent post (the highest level manager) and the chairperson of the board of directors of a company are the same person, spouses, or relatives within the first degree of kinship, an explanation shall be given of the reason for, reasonableness, necessity thereof, and the measures adopted in response thereto (e.g. increasing the number of independent directors and ensuring that a majority of directors do not concurrently serve as an employee or managerial officer).

3.2.2 Major Corporate Shareholders: None

3.2.3 Directors and Supervisors: A. Professional qualifications and independence analysis of directors and independent directors:

Criteria Name	Professional Qualification and Experience	Independence Criteria
Director SU TUNG YUNG	Work experience required for business and corporate services	Director SU TUNG YUNG, or spouse, or relative within the second degree of kinship has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.
Director SU CHIN YUAN	Work experience required for business and corporate services	Director SU CHIN YUAN, or spouse, or relative within the second degree of kinship has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.
Director SU TING KUEI	Work experience required for business and corporate services	Director SU TING KUEI, or spouse, or relative within the second degree of kinship has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.
Director SU PAI HUNAG	Work experience required for business and corporate services	Director SU PAI HUNAG, or spouse, or relative within the second degree of kinship has not served as a director, supervisor, or employee of the company or any affiliate of the company, and has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.
Director LU HSUEH TUNG	Work experience required for business and corporate services	Director LU HSUEH TUNG, or spouse, or relative within the second degree of kinship has not served as a director, supervisor, or employee of the company or any affiliate of the company, and has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.
Director SU TING HUNG	Work experience required for business and corporate services	Director SU TING HUNG, or spouse, or relative within the second degree of kinship has not served as a director, supervisor, or employee of the company or any affiliate of the company, and has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.
Independent Director SU TING	Work experience required for business and corporate services	Independent Director SU TING, or spouse, or relative within the second degree of kinship has not served as a director, supervisor, or employee of the company or any affiliate of the company, and has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.

Independent Director CHIEN HUA YUEH	Work experience required for business and corporate services	Independent Director CHIEN HUA YUEH, or spouse, or relative within the second degree of kinship has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.	0
Independent Director LIEN SAN HO	Work experience required for business and corporate services	Independent Director LIEN SAN HO, or spouse, or relative within the second degree of kinship has not served as a director or supervisor of the company or any affiliate of the company, and has not provide commercial, legal, financial, accounting, or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation.	0

B. Diversity and Independence of the Board of Directors:

(1) Diversity of the board of directors: The Company’s Board of Directors is comprised of members from the capital, employees and external individuals. The board of directors’ meetings were held four times in 2022, and the attendance rate of all directors was 91.67%. As for the members of the Board of Directors, their gender and age, please refer to the table of Directors and Supervisors, which shows their professional qualifications and experience.
(2) Independence of the board of directors: In 2022, there are 3 independent directors in the Company, accounting for 33.34% of the total number of directors. Describe the status of independence of the board of directors and give a statement of reasons as to whether the provisions of Article 26-3, paragraphs 3 and 4 of the Securities and Exchange Act are complied with, including a description of any spousal relationship or familial relationship within the second degree of kinship that may exist between any directors, between any supervisors, or between any director(s) and supervisor(s).

3.2.4 Directors, Supervisors and Management Team

													12,31,2022	12,31,2022	12,31,2022	12,31,2022
Title (Note 1)	Nationality	Name	Gender	Date elected	Current Shareholding		Spouse & Minor Shareholding		Shareholding by Nominee Arrangement		Experience (Education) (Note 2)	Other Position	Managers who are spouses or Within Two Degrees of Kinship			Remark(s) (Note 3)
					Shares	%	Shares	%	Shares	%			Title	Name	Relation
General Manager	Taiwan	SU CHIN YUAN	Male	06/16/1985	8,087,958	5.98%	100,000	0.07%	0	0	Tamkang University Department of Business	Chairman of Kunshan LilyTextile Co.	None
Purchasing Associate	Taiwan	SU TING HUNG	Male	01/03/2020	5,230,597	3.86%	870,000	0.64%	0	0	Takming University of Science and Technology	Chairman of SUNNY LOGISTICS CO., LTD.	None
Logistics Manager	Taiwan	LU HSUEH TUNG	Female	07/01/2002	50,665	0.04%	0	0	0	0	Nanya Institute of Technology Department of Textile	None	None
Finance Manager	Taiwan	CHEN YEN LING	Female	08/05/2009	0	0	0	0	0	0	National Taiwan University of Science and Technology Department of Industrial Management	None	None
Accounting Manager	Taiwan	CHEN SHU CHEN	Female	12/31/2005	0	0	0	0	0	0	National Open University Department of Business	None	None

3.3 Remuneration of Directors, Independent Directors, Supervisors, President, and Vice Presidents

3.3.1 Remuneration of Directors and Independent Director

		3.3.1 Remunerationof Directors andIndependentDirector	3.3.1 Remunerationof Directors andIndependentDirector	3.3.1 Remunerationof Directors andIndependentDirector	3.3.1 Remunerationof Directors andIndependentDirector	3.3.1 Remunerationof Directors andIndependentDirector	3.3.1 Remunerationof Directors andIndependentDirector	3.3.1 Remunerationof Directors andIndependentDirector	3.3.1 Remunerationof Directors andIndependentDirector
Job title	Name	Remuneration of Directors									Ratio of Total Remuneration (A+B+C+D) to Net Income (%) (Note 10)		Remuneration received bydirectors for concurrent				service as an employee				Ratio of Total Compensat (A+B+C+D+E+F+G) to Income (%) (Note 10)		N Remuneration from ventures other than subsidiaries or from the parent company (Note 11)
		Base Compensation (A) (Note 2)		Severance Pay (B)		Directors Compensation (C) (Note 3)		Allowances (D) (Note 4)					Salary, Bonuses, and Allowances (E) (Note 5)		Severance Pay (F)		Employee Compensation(G) (Note 6)
		The company	Companies in the consolidated financial statements (Note 7)	The company	Companies in the consolidated financial statements (Note 7)	The compan y	Companies in the consolidated financial statements (Note 7)	The company	Companies in the consolidated financial statements (Note 7)	c	The ompany	Companies in the consolidated financial statements (Note 7)	The company	Companies in the consolidated financial statements (Note 7)	The company	Companies in the consolidated financial statements (Note 7)	The company		Companies in the consolidated financial statements (Note 7)		The compan y	Companies in the consolidated financial statements (Note 7)
																	Cash	Stock	Cash	Stock
Chairman	SU TUNG YUNG	0	0	0	0	0	100,000	120,000	120,000		0.05%	0.08%	2,410,400	5,407,200	0	0	0	0	0	0	1.12%	3.94%	0
Director	SU CHIN YUAN	0	0	0	0	0	50,000	120,000	120,000		0.05%	0.08%	2,127,734	2,127,734	0	0	0	0	0	0	1.00%	1.61%	0
Director	SU TING KUEI	0	0	0	0	0	0	120,000	120,000		0.05%	0.08%	1,082,400	1,082,400	0	0	0	0	0	0	0.53%	0.84%	0
Director	SU PAI HUANG	0	0	0	0	0	0	120,000	120,000		0.05%	0.08%	0	0	0	0	0	0	0	0	0.05%	0.08%	0
Director	LU HSUEH TUNG	0	0	0	0	0	0	120,000	120,000		0.05%	0.08%	1,007,644	1,007,644	0	0	0	0	0	0	0.50%	0.79%	0
Director	SU TING HUNG	0	0	0	0	0	0	60,000	60,000		0.03	0.04%	527,600	527,600	0	0	0	0	0	0	0.26%	0.41%	0
Independent Director	SU TING	0	0	0	0	0	0	240,000	240,000		0.11%	0.17%	0	0	0	0	0	0	0	0	0.11%	0.17%	0
Independent Director	CHIEN HUA YUEH	0	0	0	0	0	0	240,000	240,000		0.12%	0.17%	0	0	0	0	0	0	0	0	0.11%	0.17%	0
Independent Director	LIEN SAN HO	0	0	0	0	0	0	120,000	120,000		0.05%	0.08%	0	0	0	0	0	0	0	0	0.05%	0.08%	0
1.Please describe the policy, system, standards and structure in place for paying remuneration to directors and describe the relationship of factors such as the duties and risks undertaken and time invested by the directors to the amount of remuneration paid.：The Company does not allocate remuneration for independent directors due to its losses. 2.In addition to what is disclosed in the above table, please specify the amount of remuneration received by directors in the most recent fiscal year for providing services (e.g., for serving as a non-employee consultant to the parent company /any consolidated entities / invested enterprises)：In addition to what is disclosed in the above table, please specify the amount of remuneration received by in the most recent fiscal year for providing services (e.g., for serving as a non-employee consultant to the parent company/any consolidated entities/invested enterprises): None. 3.The expenses and perquisites consist of monthly travel expenses.

Range of Remuneration

	Range of Remuneration	Range of Remuneration	Range of Remuneration	Range of Remuneration
Ranges of remuneration paid to each of the Company’s directors	Name of Directors
	Total of (A+B+C+D)		Total of (A+B+C+D+E+F+G)
	The company (Note 8)	Companies in the consolidated financial statements (Note 9) H	The company (Note 8)	Companies in the consolidated financial statements (Note 9) I
Less than NT$ 1,000,000	SU TUNG YUNG, SU CHIN YUAN, SU TING KUEI, SU PAI HUANG, LU HSUEH TUNG, SU TING HUNG, SU TING (Independent Director), CHIEN HUA YUEH (Independent Director), LIEN SAN HO (Independent Director)	SU TUNG YUNG, SU CHIN YUAN, SU TING KUEI, SU PAI HUANG, LU HSUEH TUNG, SU TING HUNG, SU TING (Independent Director), CHIEN HUA YUEH (Independent Director), LIEN SAN HO (Independent Director)	SU PAI HUANG, SU TING HUNG, SU TING (Independent Director), CHIEN HUA YUEH (Independent Director), LIEN SAN HO (Independent Director)	SU PAI HUANG, SU TING HUNG, SU TING (Independent Director), CHIEN HUA YUEH (Independent Director), LIEN SAN HO (Independent Director)
NT$ 1,000,000 (incl.)~NT$ 2,000,000 (excl.)			SU TING KUEI, LU HSUEH TUNG	SU TING KUEI, LU HSUEH TUNG
NT$ 2,000,000 (incl.)~NT$ 3,500,000 (excl.)			SU TUNG YUNG, SU CHIN YUAN	SU CHIN YUAN
NT$ 3,500,000 (incl.)~NT$ 5,000,000 (excl.)
NT$ 5,000,000 (incl.)~NT$ 10,000,000 (excl.)				SU TUNG YUNG
NT$ 10,000,000 (incl.)~NT$ 15,000,000 (excl.)
NT$ 15,000,000 (incl.)~NT$ 30,000,000 (excl.)
NT$ 30,000,000 (incl.)~NT$ 50,000,000 (excl.)
NT$ 50,000,000 (incl.)~NT$ 100,000,000 (excl.)
Greater than or equal to NT$ 100,000,000
Total

Note 1: The name of each director shall be stated separately (for a corporate shareholder, the names of the corporate shareholder and its representative shall be stated separately) and the names of the ordinary directors and independent directors shall be stated separately, based on the amount of the aggregated remuneration items paid to each. If a director concurrently serves as a general manager or an assistant general manager, please complete this Table and Table 3-1, or Tables 3-2-1 and 3-2-2.
Note 2: This refers to director base compensation in the most recent fiscal year (including director salary, duty allowances, severance pay, and various rewards and incentives, etc.).
Note 3: Please fill in the amount of director profit-sharing compensation approved by the board of directors for distribution for the most recent fiscal year.
Note 4: This refers to director expenses and perquisites in the most recent fiscal year (including travel expenses, special disbursements, stipends of any kind, and provision of facilities such as accommodations or vehicles, etc.). If housing, car or other form of transportation, or personalized expenses are provided, disclose the nature and cost of the property provided, the actual or fair market P. 12 of 93 rent, fuel expenses, and any other amounts paid. Additionally, if a driver is provided, please add a note explaining the relevant base compensation paid by the Company to the driver, but do not include it in the calculation of the director remuneration.
Note 5: This includes any remuneration received by a director for concurrent service as an employee in the most recent year (including concurrent service as general manager, assistant general manager, other managerial officer, or non-managerial employee) including salary, duty allowances, severance pay, rewards, incentives, travel expenses, special disbursements, stipends of any kind, and provision of facilities such as accommodations or vehicles, etc. If housing, car or other form of transportation, or personalized expenses are provided, disclose the nature and cost of the property provided, the actual or fair market rent, fuel expenses, and any other amounts paid. Additionally, if a driver is provided, please add a note explaining the relevant base compensation paid by the Company to the driver, but do not include it in the calculation of the director remuneration. Additionally, salary expenses recognized as share-based payment under IFRS 2—including employee share subscription warrants, new restricted employee shares, and participation in share subscription under a rights offering, etc.—should be included in the calculation of remuneration.
Note 6: This refers to employee profit-sharing compensation (including stocks and cash) received by a director for concurrent service as an employee in the most recent fiscal year (including concurrent service as general manager, assistant general manager, other managerial officer, or non-managerial employee). Disclose the amount of profit-sharing compensation approved or expected to be approved by the board of directors for distribution for the most recent fiscal year. If the amount cannot be forecasted, disclose the amount expected to be distributed by calculating pro-rata to the amount that was actually distributed in the preceding fiscal year. Table 1-3 should also be completed.
Note 7: Disclose the total amount of remuneration in each category paid to the directors of the Company by all companies in the consolidated financial report (including the Company).
Note 8: Disclose the names of the directors in the respective ranges into which they fall based on the sum total of the remuneration in the indicated categories paid to each director by the Company.
Note 9: Disclose the names of the directors in the respective ranges into which they fall based on the sum total of the remuneration in the indicated categories paid to each director of the Company by all companies in the consolidated financial report (including the Company).
Note 10: Net income means the net income after tax on the parent company only or individual financial report for the most recent fiscal year.
Note 11: a. In this column, specifically disclose the amount of remuneration received by the directors of the Company from investee enterprises other than subsidiaries or from the parent company (if none, state “None”).
b. If directors of the Company have received remuneration from investee enterprises other than subsidiaries or from the parent company, that remuneration shall be added into the amount in Column I of the Remuneration Range Table, and the name of that column shall be changed to “Parent company and all investee enterprises.”
c. Remuneration means remuneration received by directors of the Company for serving in capacities such as director, supervisor, or managerial officer at investee companies other than subsidiaries or at the parent company, including base compensation, profit-sharing compensation (including employee, director, and supervisor profit-sharing compensation) and expenses and perquisites.
*This table is for information disclosure purposes only and is not intended to be used for tax purposes, as the remuneration disclosed in this table differs from the concept of income under the Income Tax Act.
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3.3.2 Remuneration of Supervisors:

		Remuneration of Supervisors	Remuneration of Supervisors	Remuneration of Supervisors			Ratio of Total Remuneration (A+B+C) to Net Income (%) (Note 8)	Ratio of Total Remuneration (A+B+C) to Net Income (%) (Note 8)	Ratio of Total Remuneration (A+B+C) to Net Income (%) (Note 8)	Remuneration from ventures other than subsidiaries or from the parent company (Note 9)
Base Compensation (A) (Note 2)		Bonus to Supervisors (B) (Note 3)			Allowances (C) (Note 4)
The company	Companies in the consolidated financial statements (Note 5)	The company	Companies in the consolidated financial statements (Note 5)		The company	Companies in the consolidated financial statements (Note 5)	The company		Companies in the consolidated financial statements (Note 5)
0	0	0	0		120,000	120,000	0.05%		0.05%	0
					Range of Remuneration
Ranges of remuneration paid to each of the Company’s supervisors					Name of Supervisors
					Total of (A+B+C)
					The company (Note 6)			Companies in the consolidated financial statements (Note 7) D
Less than NT$ 1,000,000				SU PAI HUANG, CHANG CHING PIN				SU PAI HUANG, CHANG CHING PIN
NT$ 1,000,00 (incl.)~NT$ 2,000,00 (excl.)
NT$ 2,000,000 (incl.)~NT$ 3,500,000 (excl.)
NT$ 3,500,000 (incl.)~NT$ 5,000,00 (excl.)
NT$ 5,000,000 (incl.)~NT$ 10,000,000 (excl.)
NT$ 10,000,000 (incl.)~NT$ 15,000,000 (excl.)
NT$ 15,000,000 (incl.)~NT$ 30,000,000 (excl.)
NT$ 30,000,000~NT$ 50,000,000
NT$ 50,000,000~100,000,000
Greater than or equal to NT$ 100,000,00
Total

Note 1: The name of each supervisor shall be stated separately (for a corporate shareholder, the names of the corporate shareholder and its representative shall be stated separately) based on the amount of the aggregated remuneration items paid to each.
Note 2: This refers to supervisor base compensation in the most recent fiscal year (including supervisor salary, duty allowances, severance pay, and various rewards and incentives, etc.). Note 3: Please fill in the amount of supervisor profit-sharing compensation approved by the board of directors for distribution for most recent fiscal year.
Note4: This refers to expenses and perquisites paid to supervisors in the most recent fiscal year (including travel expenses, special disbursements, stipends of any kind, and provision of facilities such as accommodations or vehicles, etc.). If housing, car or other form of transportation, or personalized expenses are provided, disclose the nature and cost of the property provided, the actual or fair market rent, fuel expenses, and any other amounts paid. Additionally, if a driver is provided, please add a note explaining the relevant base compensation paid by the company to the driver, but do not include it in the calculation of the director remuneration.
Note 5: Disclose the total amount of remuneration in each category paid to the supervisors of the Company by all companies in the consolidated financial report (including the Company).
Note 6: Disclose the names of the supervisors in the respective ranges into which they fall based on the sum total of the remuneration in the indicated categories paid to each supervisor by the Company.
Note 7: Disclose the names of the supervisors in the respective ranges into which they fall based on the sum total of the remuneration in the indicated categories paid to each supervisor of the Company by all companies in the consolidated financial reports (including the Company).
Note 8: Net income means the net income after tax on the parent company only or individual financial report for the most recent fiscal year.
Note 9: a. In this column, specifically disclose the amount of remuneration received by the supervisors of the Company from investee enterprises other than subsidiaries or from the parent company (if none, state “None”).
b. If supervisors of the Company have received remuneration from investee enterprises other than subsidiaries or from the parent company, that remuneration shall be added into the amount in Column D of the Remuneration Range Table, and the name of that column shall be changed to “Parent company and all investee enterprises.”
c. Remuneration means remuneration received by supervisors of the Company for serving in capacities such as director, supervisor, or managerial officer at investee companies other than subsidiaries or at the parent company, including base compensation, profit-sharing compensation (including employee, director, and supervisor profit-sharing compensation) and expenses and perquisites.*This table is for information disclosure purposes only and is not intended to be used for tax purposes, as the remuneration disclosed in this table differs from the concept of income under the Income Tax Act.
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3.3.3 Remuneration of General Manager(s) and Assistant General Manager(s):

Title	Name	Salary (A) (Note 2)	Salary (A) (Note 2)	Severance Pay (B)	Severance Pay (B)	Bonuses and Allowances (C) (Note 3)	Bonuses and Allowances (C) (Note 3)	Employee Compensation (D) (Note 4)	Employee Compensation (D) (Note 4)	Employee Compensation (D) (Note 4)	Employee Compensation (D) (Note 4)	Ratio of Total Remuneration (A+B+C+D) to Net Income (%) (Note 8)	Ratio of Total Remuneration (A+B+C+D) to Net Income (%) (Note 8)	Remuneration from ventures other than subsidiaries or from the parent company (Note 9)
		The company	Companies in the consolidated financial statements (Note 5)	The company	Companies in the consolidated financial statements (Note 5)	The company	Companies in the consolidated financial statements (Note 5)	The company		Companies in the consolidated financial statements (Note 5)		The company	Companies in the consolidated financial statements (Note 5)
								Cash	Stock	Cash	Stock
Supervisor	SU CHIN YUAN	2,127,734	2,127,734	0	0	0	0	0	0	0	0	0.94%	0.94%	0

Range of Remuneration

Supervisor YUAN 2,127,734 2,127,734 0 0	Range of Remuneration 0 0 0 0 0 0 0.94% 0.94% 0	Range of Remuneration 0 0 0 0 0 0 0.94% 0.94% 0
Ranges of remuneration paid to each of the Company’s general manager(s) and assistantgeneral manager(s)	Name of President and Vice Presidents
	The company (Note 6)	Companies in the consolidated financial statements (Note 7) E
Less than NT$ 1,000,000
NT$ 1,000,000~NT$ 2,000,000
NT$ 2,000,000~NT$ 3,500,000	SU CHIN YUAN	SU CHIN YUAN
NT$ 3,500,000~NT$ 5,000,000
NT$ 5,000,000~NT$ 10,000,000
NT$ 10,000,000~NT$ 15,000,000
NT$ 15,000,000~NT$ 30,000,000
NT$ 30,000,000~NT$ 50,000,000
NT$ 50,000,000~NT$ 100,000,000
Greater than or equal to NT$ 100,000,000
Total

Note 1: The name of each general manager and assistant general manager shall be stated separately, based on the amount of the aggregated remuneration items paid to each. If a director concurrently serves as a general manager or an assistant general manager, please complete this table and Table (1-1), or Tables (1-2-1) and (1-2-2).
Note 2: This includes salary, duty allowances, and severance pay to the general manager(s) and assistant general manager(s) in the most recent fiscal year.
Note 3: This includes the amounts of all types of rewards, incentives, travel expenses, special disbursements, stipends of any kind, provision of facilities such as accommodations or vehicle, and other compensation to the general manager(s) and assistant general manager(s) in the most recent fiscal year. If housing, car or other form of transportation, or personalized expenses are provided, disclose the nature and cost of the property provided, the actual or fair market rent, fuel expenses, and any other amounts paid. Additionally, if a driver is provided, please add a note explaining the relevant base compensation paid by the company to the driver, but do not include it in the calculation of the director remuneration. Additionally, salary expenses recognized as share-based payment under IFRS 2—including employee share subscription warrants, new restricted employee shares, and participation in share subscription under a rights offering, should be included in the calculation of remuneration.
Note 4: This refers to employee profit-sharing compensation (including stocks and cash) received by the general manager(s) and assistant general manager(s) as approved or expected to be approved by the board of directors for the most recent fiscal year (including concurrent service as general manager, assistant general manager, other managerial officer, or non-managerial employee). If the amount cannot be forecasted, disclose the amount expected to be distributed by calculating pro-rata to the amount that was actually distributed in the preceding fiscal year. Table 1-3 should also be completed.
Note 5: Disclose the total amount of remuneration in each category paid to the general manager(s) and assistant general manager(s) by all companies in the consolidated financial report (including the Company)
Note 6: Disclose the names of the general manager(s) and assistant general manager(s) in the respective ranges into which they fall based on the sum total of the remuneration in the indicated categories paid to each general manager and assistant general manager by the Company.
Note 7: Disclose the names of the general manager(s) and assistant general manager(s) in the respective ranges into which they fall based on the sum total of the remuneration in the indicated categories paid to each general manager and assistant general manager of the Company by all companies in the consolidated financial report (including the Company).
Note 8: Net income means the net income after tax on the parent company only or in dividual financial report for the most recent fiscal year.
Note 9: a. In this column, specifically disclose the amount of remuneration received by the general manager(s) and assistant general manager(s) of the Company from investee enterprises other than subsidiaries or from the parent company (if none, state “None”)
b. If general manager(s) or assistant general manager(s) of the Company have received remuneration from investee enterprises other than subsidiaries or from the parent company, that remuneration shall be added into the amount in Column E of the Remuneration Range Table, and the name of that column shall be changed to “Parent company and all investee enterprises.”
c. Remuneration means remuneration received by the general manager(s) and assistant general manager(s) of the Company for serving in capacities such as director, supervisor, or managerial officer at investee companies other than subsidiaries or at the parent company, including base compensation, profit-sharing compensation (including employee, director, and supervisor profit-sharing compensation) and expenses and perquisites.
*This table is for information disclosure purposes only and is not intended to be used for tax purposes, as the remuneration disclosed in this table differs from the concept of income under the Income Tax Act.
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3.3.4 Managerial officers with the top five highest remuneration amounts in a TWSE/TPEx-listed company

Title	Name	Salary (A) (Note 2)	Salary (A) (Note 2)	Severance Pay (B)	Severance Pay (B)	Bonuses and Allowances (C) (Note 3)	Bonuses and Allowances (C) (Note 3)	Employee Compensation (D) (Note 4)	Employee Compensation (D) (Note 4)	Employee Compensation (D) (Note 4)	Employee Compensation (D) (Note 4)	Ratio of total compensation (A+B+C+D) to net income (％) (Note 6)	Ratio of total compensation (A+B+C+D) to net income (％) (Note 6)	Remuneration from ventures other than subsidiaries or from the parent company (Note 7)
		The company	Companies in the consolidated financial statements (Note 5)	The company	Companies in the consolidated financial statements (Note 5)	The company	Companies in the consolidated financial statements (Note 5)	The company		Companies in the consolidated financial statements (Note 5)		The company	Companies in the consolidated financial statements
								Cash	Stock	Cash	Stock
Chairman	SU TUNG YUNG	2,410,400	5,407,200	0	0	0	0	0	0	0	0	1.07	2.40	0
General Manager	SU CHIN YUAN	2,127,734	2,127,734	0	0	0	0	0	0	0	0	0.94	0.94	0
Director	SU TING KUEI	1,082,400	1,082,400	0	0	0	0	0	0	0	0	0.48	0.48	0
Associate	SU TING HUNG	527,600	527,600	0	0	0	0	0	0	0	0	0.23	0.23	0
Manager	LU HSUEH TUNG	1,007,644	1,007,644	0	0	0	0	0	0	0	0	0.45	0.45	0

Note1: Managerial officers with the top five highest remuneration amounts refers to managers at the Company, in which the standard for determining managers is the applicable scope set forth in Order Tai-Cai-ZhengSan-Zi No. 0920001301 from the former Securities and Futures Commission, Ministry of Finance dated March 27, 2003. The top five highest remuneration amounts are determined based on the sum of salaries, severance pay, bonuses and allowances, and employee compensation received by a managerial officer from all companies in the consolidated financial statements (i.e., A+B+C+D)

Note 2: Refers to the salaries, duty allowances, and severance pay paid to the managerial officers with the top five remuneration amounts in the most recent year.

Note 3: Refers to the remuneration paid to the managerial officers with the top five remuneration amounts, including various bonuses, incentives, travel expenses, special disbursements, allowances, accommodation, company car, other physical items, other compensations, etc., in the most recent year. Where housing, cars, other means of transportation, or expenditures exclusively for individuals are offered, the nature and costs of the offered assets, the actual rent or fair market rent, fuel expenses, and other benefits shall be disclosed. In addition, where a driver is provided, please provide an explanation in the notes on the compensation paid to the driver by the Company, but not calculating as remuneration. The salaries recognized in accordance with IFRS 2 "Share-based Payment," including the share subscription warrants issued to employees, new restricted stock award shares issued to employees, and employee stock at cash capital increase, shall also be calculated as remuneration.

Note 4: Refers to the amount of employee compensation (including stock and cash) approved by the Board of Directors for managerial officers with the top five remuneration amounts in the most recent year. If the amount of employee compensation cannot be estimated this year, the proposed amount should be calculated based on the actual amount and ratio distributed last year, and complete Table (1-3).
Note 5: The total remuneration paid by all companies in the consolidated statements (including the Company) to managerial officers with the top five highest remuneration amounts must be disclosed. Note 6: The net income after-tax refers to the net income after-tax in the standalone financial statements for the most recent year.
Note 7: a. Specify the amount of remuneration received by managerial officers with the top five remuneration amounts from ventures other than subsidiaries or from the parent company in this field (Please fill in "None" if none).
b. The remuneration means pay, compensation (including compensation of employees, directors and supervisors) and business expenses received by managerial officers with the top five remuneration amounts who are serving as a director, supervisor or manager of ventures other than subsidiaries or of the parent company.
The remuneration disclosed in the table is different from income as defined in the Income Tax Act. This table is therefore provided for disclosure only and is not used for taxation purposes.
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3.3.5 The ratio of total remuneration paid by the Company and by all companies included in the consolidated financial statements for the two most recent fiscal years to directors, supervisors, general manager, and assistant general managers of the Company, to the net income. The policies, standards, and portfolios for the payment of remuneration, the procedures for determining remuneration, and the correlation with risks and business performance.

Title		2021		2022
	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements
Directors	3.58%	4.56%	3.71%	5.10%
Supervisors	0.11%	0.11%	0.05%	0.05%
General manager and assistant general managers	0.96%	0.97%	0.94%	0.94%

3.3.6 Distribution Rules of the Bonuses for Employees, Directors, and Supervisors:
A. The percentages or ranges with respect to employee, director, and supervisor compensation, as set forth in the Articles of Incorporation: If the Company has gained profits within a fiscal year, not to be less than 3% shall be reserved as the employees’ compensation. The employees' compensation can be obtained by stock or cash, and the object of the employee's compensation is to include the employees of the subordinate company that meet the conditions set by the Board of Directors. The Company may set aside up to 3% of the abovementioned profit to be reserved as the directors’ and supervisors’ compensation by resolution of the Board of Directors. The distribution of employees’ compensation and directors’ compensation should be reported at the Shareholders’ Meeting. However, in case of the accumulated losses, certain profits shall be reserved to cover them, and the compensation to employees, directors, and supervisors shall be reserved in proportion to the aforementioned amount.
B. Due to accumulated losses in the past two fiscal years, the Company has not distributed any remuneration. The remuneration to directors and supervisors listed in this table represents travel expenses and salaries received by directors who also serve as managers.
3.3.7 Names and Distribution of Employee Compensation to Managerial Officers: Due to accumulated losses in the past two fiscal years, therefore no allotment was made.
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3.4 Implementation of Corporate Governance

3.4.1 Operations of the Board of Directors

A total of 4 meetings of the Board of Directors were held in the previous period. The attendance of director and supervisor were as follows:

January 1, 2022 ~ December 31, 2022

	Title	Title	Name (Note1)	Name (Note1)	Attendance in Person (B)	By Proxy	By Proxy	Attendance Rate (%) 【B/A】(Note 2)	Remarks
	Chairman		SUTUNGYUNG		4	0		100%
	Director		SU CHIN YUAN		4	0		100%
	Director		SUTINGKUEI		3	1		75%
	Director		SU PAI HUANG		3	1		75%
	Director		LU HSUEH TUNG		4	0		100%
	Director		SUTINGHUNG		4	0		100%
	Independent Director		SU TING		4	0		100%
	Independent Director		CHIEN HUA YUEH		3	1		75%
	Independent Director		LIEN SAN HO		4	0		100%
	3.4.2 Implementation status of Board Evaluations:
Evaluation cycle (Note 1)		Evaluation period (Note 2)		Scope of evaluation (Note 3)			Evaluation method (Note 4)		Evaluation items (Note 5)
Once a year		Evaluation of Board performance between January 1, 2022 and December 31, 2022		The Board of Directors Functional committees			Internal self-evaluation by the Board of Directors Remuneration Committee Audit committee	1 Board composition and structure: 9 directors, including 3 independent directors. 2. Attendance of the Board of Directors: The attendance rate of the Board of Directors is over 92%. 3. The status of directors participating in continuous education: Due to the severe pandemic in 2022, all directors did not engage in continuous education except Director SU PAI HUANG.4. A total of 3 meetings of Remuneration Committee were held in 2022, and all 3 members attended the meetings. 5. A total of 4 meetings of Remuneration Committee were held in 2022. Except for once when one member attended by proxy, the other three times all three members attended.
Once a year		Evaluation of Board performance between January 1, 2022, and December 31, 2022		Individual directors			Self-assessment by directors	1. Grasp of company targets and missions: Excellent 2. Understanding of the director’s role and responsibilities: Excellent 3. Level of participation in company operations: Excellent 4. Internal relationship management and communication: Excellent 5. Director’s specialty and continued development: Excellent 6.Internalcontrols:Excellent

3.4.3 The Status of Directors Participating in Continuous Education and Training Regarding Corporate Governance:

Title	Name	Date	Course	Training hours
Director	SU PAI HUANG	November 3, 2022	Summary of Short-swing Trading By Insiders and Case Analysis	3H
		November 15, 2022	Contest for Corporate Control and Analysis of Preventive Strategies	3H

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3.4.4 Operation of the Audit Committee:

A total of 4 (A) Audit Committee meetings were held in the previous period. The attendance of the independent directors was as follows:

				01,01,2022~12,31,2022	01,01,2022~12,31,2022
Title	Name (Note 1)	Attendance in Person(B)	By Proxy	Attendance Rate (%) 【B/A】(Note 2)	Remarks
Independent Director	CHIEN HUA YUEH	3	1	75%
Independent Director	SU TING	4	0	100%
Independent Director	LIEN SAN HO	4	0	100%

Independent Director SU TING 4 0 100% Independent Director LIEN SAN HO 4 0 100%	Independent Director SU TING 4 0 100% Independent Director LIEN SAN HO 4 0 100%	Independent Director SU TING 4 0 100% Independent Director LIEN SAN HO 4 0 100%	Independent Director SU TING 4 0 100% Independent Director LIEN SAN HO 4 0 100%	Independent Director SU TING 4 0 100% Independent Director LIEN SAN HO 4 0 100%
3.4.5 Corporate Governance Implementation Status and Deviations from “the Corporate GovernanceBest-PracticePrinciplesfor TWSE/TPEx Listed Companies”
Evaluation Item	Implementation Status (Note1)			Deviations from “the Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies”and Reasons
	Yes	No	Abstract Illustration
1. Does the company establish and disclose the Corporate Governance Best-Practice Principles based on “Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”?		No	Currently evaluating	Evaluation is still under discussion
2. Shareholding structure & shareholders’ rights (1) Does the company establish an internal operating procedure to deal with shareholders’ suggestions, doubts, disputes and litigations, and implement based on the procedure? (2) Does the company possess the list of its major shareholders as well as the ultimate owners of those shares? (3) Does the company establish and execute the risk management and firewall system within its conglomerate structure? (4) Does the company establish internal rules against insiders trading with undisclosed information?	Yes Yes Yes	No	Although the Company has entrusted MasterLink Securities Corp. as our stock agent, we have dedicated personnel responsible for addressing shareholders’ suggestions or disputes. We maintain a good relationship with our major shareholders relationship and keep in touch at all times. Subsidiary monitoring operations have been established and implemented. Under planning	Conformed Conformed Conformed Currently planning
3. Composition and Responsibilities of the Board of Directors (1) Does the Board develop and implement a diversified policy for the composition of its members? (2) Does the company voluntarily establish other functional committees in addition to the Remuneration Committee and the Audit Committee? (3) Does the company establish a standard to measure the performance of the Board and implement it annually, and are performance evaluation results	Yes	No No	Still under discussion Still under discussion	Currently planning Set up when there is a future need Conformed

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Evaluation Item	Implementation Status (Note1)	Implementation Status (Note1)	Implementation Status (Note1)	Deviations from “the Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies”and Reasons
	Yes	No	Abstract Illustration
submitted to the Board of Directors and referenced when determining the remuneration of individual directors and nominations for reelection? (4) Does the company regularly evaluate the independence of CPAs?	Yes		Quarterly	Conformed
4. Does the company appoint a suitable number of competent personnel and a supervisor responsible for corporate governance matters (including but not limited to providing information for directors and supervisors to perform their functions, assisting directors and supervisors with compliance, handling work related to meetings of the board of directors and the shareholders' meetings, and producing minutes of board meetings and shareholders'meetings)?		No	Still under discussion	Set up when there is a future need
5. Does the company establish communication channel and build a designated section on its website for stakeholders (including but not limited to shareholders, employees, customers, and suppliers), as well as handle all the issues they care for in terms of corporate social responsibilities?	Yes		Established	Conformed
6. Does the company appoint a professional shareholder service agency to deal with shareholder affairs?	Yes		The Company entrusted MasterLink Corp. as our stock agent.	Conformed
7. Information Disclosure (1) Does the company have a corporate website to disclose both financial standings and the status of corporate governance? (2) Does the company have other information disclosure channels (e.g. building an English website, appointing designated people to handle information collection and disclosure, creating a spokesman system, webcasting investor conferences)? (3) Does the company announce and report annual financial statements within two months after the end of each fiscal year, and announce and report Q1, Q2, and Q3 financial statements, as well as monthly operation results, before the prescribed time limit?	Yes Yes No		Financial statements are posted on the website quarterly. All websites are available except for the English version. Due to the existence of domestic and foreign subsidiaries of the Company, they are required to be audited or reviewed by local CPAs. The timing cannot be advanced, but all necessary filings have been completed within the prescribed period.	Conformed Conformed Conformed
8. Is there any other important information to facilitate a better understanding of the	Yes		The Company is insured with Directors and Supervisors	Conformed

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Evaluation Item	Implementation Status (Note1)	Implementation Status (Note1)	Implementation Status (Note1)
	Yes	No	Abstract Illustration
company’s corporate governance practices (e.g., including but not limited to employee rights, employee wellness, investor relations, supplier relations, rights of stakeholders, directors’ and supervisors’ training records, the implementation of risk management policies and risk evaluation measures, the implementation of customer relations policies, and purchasing insurance for directors and supervisors)?			Liability Insurance annually.
9. Please explain the improvements which have been made in accordance with the results of the Corporate Governance Evaluation System released by the Corporate Governance Center, Taiwan Stock Exchange, and provide the priority enhancement measures.

Please explain the improvements which have been made in accordance with the results of the Corporate Governance Evaluation System released by the Corporate Governance Center, Taiwan Stock Exchange, and provide the priority enhancement measures.

Note: Regardless of whether the evaluation item is achieved or not, the company shall state an appropriate explanation.

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3.4.6 Fulfillment of CSR and Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”

Evaluation Item	Implementation Status (Note1)	Implementation Status (Note1)	Implementation Status (Note1)	Deviations from “the Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies”andReasons
	Yes	No	Abstract Illustration (Note2)
1. Does the company assess ESG risks associated with its operations based on the principle of materiality, and establish related risk management policies or strategies? (Note3)		No	The Company does not have a corporate social responsibility policy or system in place.	Not applicable
2. Does the company establish exclusively (or concurrently) dedicated first-line managers authorized by the board to be in charge of proposing the corporate social responsibility policies and reporting to the board?		No	The Company has not yet set up a dedicated or part-time unit to promote corporate social responsibility.	Not applicable
3. Environmental issues (1) Does the company establish proper environmental management systems based on the characteristics of their industries? (2) Does the company endeavor to utilize all resources more efficiently and use renewable materials which have low impact on the environment? (3) Does the company evaluate the potential risks and opportunities in climate change with regard to the present and future of its business, and take appropriate action to counter climate change issues? (4) Does the company take inventory of its greenhouse gas emissions, water consumption, and total weight of waste in the last two years, and implement policies on energy efficiency and carbon dioxide reduction, greenhouse gas reduction, water reduction, or waste management?	Yes Yes	No No	Not yet established Currently implemented Still under discussion Currently implemented	Not applicable Conformed Not applicable Conformed
4. Social issues (1) Does the company formulate appropriate management policies and procedures according to relevant regulations and the International Bill of Human Rights? (2) Does the company have reasonable employee benefit measures (including salaries,leave, and otherbenefits),	Yes	No	Still under discussion Currently implemented	Not applicable Conformed

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Evaluation Item	Implementation Status (Note1)	Implementation Status (Note1)	Implementation Status (Note1)	Deviations from “the Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies”andReasons
	Yes	No	Abstract Illustration (Note2)
and do business performance or results reflect on employee salaries? (3) Does the company provide a healthy and safe working environment and organize training on health and safety for its employees on a regular basis? (4) Does the company provide its employees with career development and training sessions? (5) Do the company's products and services comply with relevant laws and international standards in relation to customer health and safety, customer privacy, and marketing and labeling of products and services, and are relevant consumer protection and grievance procedure policies implemented? (6) Does the company implement supplier management policies, requiring suppliers to observe relevant regulations on environmental protection, occupational health and safety, or labor and human rights? If so, describe theresults.	Yes Yes Yes	No	Still under discussion Currently implemented Currently implemented Currently implemented	Not applicable Conformed Conformed Conformed
5. Does the company reference internationally accepted reporting standards or guidelines, and prepare reports that disclose non-financial information of the company, such as corporate social responsibility reports? Do the reports above obtainassurancefroma third party verificationunit? None
6. Describe the difference, if any, between actual practice and the corporate social responsibility principles, if the company has implemented such principles based on the Corporate Social Responsibility Best Practice Principlesfor TWSE/TPEx Listed Companies: None
7. Otheruseful information forexplaining the status ofcorporate social responsibility practices: None

Note: 1.If "Yes" is checked under implementation, please describe the key policies, strategies, and measures and results adopted. If "No" is checked under implementation, please give reasons and describe relevant strategies and measures to be adopted in the future

Companies who have compiled CSR reports may cite the source from specific pages of their CSR reports instead.
The materiality principle refers to environmental, social, or corporate governance issues that have a material impact on the investors or other stakeholders of the company.
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3.4.7 Composition, Responsibilities and Operations of the Remuneration Committee

Title (Note 1)	Criteria Name	~~Meets One of the Following Professional Qualification~~ Requirements, Together with at Least Five Years’ Work Experience	~~Meets One of the Following Professional Qualification~~ Requirements, Together with at Least Five Years’ Work Experience	~~Meets One of the Following Professional Qualification~~ Requirements, Together with at Least Five Years’ Work Experience	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Independence Criteria (Note 2)	Number of Other Public Companies in Which the Individual is Concurrently Serving as an Remuneration Committee Member	Remarks (Note 3)
		~~An instructor or~~ higher position in a department of commerce, law, finance, accounting, or other academic department related to the business needs of the Company in a public or private junior college, college or university	~~A~~ ~~judge,~~ ~~public~~ prosecutor, attorney, Certified Public Accountant, or other professional or technical specialist who has passed a national examination and been awarded a certificate in a profession necessary for the business of the Company	~~Has~~ ~~work~~ experience in the areas of commerce, law, finance, or accounting, or otherwise necessary for the business of the Company	1	2	3	4	5	6	7	8	9	10
~~Independent~~ Director	~~SU~~ TING			v	v	v	v	v	v	v	v	v	v	v	0	None
Independent Director	~~CHIEN~~ HUA YUEH			v	v	v	v	v	v	v	v	v	v	v	0	None
~~Independent~~ Director	~~LIEN~~ SAN HO			v	v	v	v	v	v	v	v	v	v	v	0	None

Note 1: For “Title,” please specify whether the member is a director, independent director or other.
Note 2: Please tick the corresponding boxes that apply to a member during the two years period to being elected or during the term(s) of office.
(1) Not an employee of the company or any of its affiliates.
(2) Not a director or supervisor of the company or any of its affiliates. The same does not apply, however, in cases where the person is a concurrent independent director of the company and its parent company, subsidiaries, or subsidiaries of the same parent company, as appointed in accordance with the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies or local laws and regulations.
(3) Not a natural-person shareholder who holds shares, together with those held by the person's spouse, minor children, or held by the person under others' names, in an aggregate of one percent or more of the total number of issued shares of the company or ranking in the top 10 in holdings.
(4) Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of a managerial officer under subparagraph 1 or any of the persons in the preceding two subparagraphs.
- (5) Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number of issued shares of the company, or that ranks among the top five in shareholdings, or that designates its representative to serve as a director or supervisor of the company under Article 27, paragraph 1 or 2 of the Company Act. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
(6) If a majority of the company's director seats or voting shares and those of any other company are controlled by the same person: not a director, supervisor, or employee of that other company. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
(7) If the chairperson, general manager, or person holding an equivalent position of the company and a person in any of those positions at another company or institution are the same person or are spouses: not a director (or governor), supervisor, or employee of that other company or institution. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
(8) Not a director, supervisor, officer, or shareholder holding five percent or more of the shares, of a specified company or institution that has a financial or business relationship with the company. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent, if the specified company or institution holds 20 percent or more and no more than 50 percent of the total number of issued shares of the public company.
(9) Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides auditing services to the company or any affiliate of the company, or that provides commercial, legal, financial, accounting or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation exceeding NT$500,000, or a spouse thereof; provided, this restriction does not apply to a member of the remuneration committee, public tender offer review committee, or special committee for merger/consolidation and acquisition, who exercises powers pursuant to the Act or to the Business Mergers and Acquisitions Act or related laws or regulations.
(10) Not been a person of any conditions defined in Article 30 of the Company Law.
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3.4.8 Operation of the Remuneration Committee

A. The Company’s remuneration committee has a total of 3 members. The committee holds at least two meetings a year, while the members evaluate the policies and systems of compensation for the directors, supervisors, and managers of the Company from a professional and objective standpoint. They then provide recommendations to the Board of Directors for the Company’s reference in decision-making.
B. The term of the current members is from June 15, 2022 to June 14, 2025. The number of remuneration committee meetings held in the most recent fiscal year was 4 (A). The attendance by the members was as follows:

January 1, 2022 ~ December 31, 2022

Title	Name	Attendance in Person (B)	By Proxy	Attendance Rate (%) (B/A) (Note)	Remarks
Convener	SU TING	3	0	100%	Independent Director
Committee Member	CHIEN HUA YUEH	3	0	100%	Independent Director
Committee Member	LIEN SAN HO	3	0	100%	Independent Director
Other mentionable items: 1. If the board of directors declines to adopt or modifies a recommendation of the remuneration committee, it should specify the date of the meeting, session, content of the motion, resolution by the board of directors, and the Company’s response to the remuneration committee’s opinion (e.g., the remuneration passed by the Board of Directors exceeds the recommendation of the remuneration committee, the circumstances and cause for the difference shall be specified): None 2. Resolutions of the remuneration committee objected to by members or expressed reservations and recorded or declared in writing, the date of the meeting, session, content of the motion, all members’opinions and the response to members’opinion should be specified: None

Note: 1. If any remuneration committee member left the committee before the end of the fiscal year, specify the date that the left the committee in the Remarks column. Their in-person attendance rate (%) should be calculated based on the number of remuneration committee meetings held and the number they attended in person during the period they were on the committee.
If any by-election for remuneration committee members was held before the end of the fiscal year, the names of the new and old committee members should be filled in the table, with a note stating whether the member left office, was newly serving, or was serving consecutive terms, and the date of the by-election. The in-person attendance rate (%) should be calculated based on the number of remuneration committee meetings held and the number attended in person during the period of each such person’s actual time on the committee.

3.4.9 Fulfillment of Ethical Corporate Management and Deviations from the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies

Evaluation Item	Implementation Status1	Implementation Status1	Implementation Status1
	Yes	No	Abstract Illustration
1. Establishment of ethical corporate management policies and programs (1) Does the company have a Board-approved ethical corporate management policy and stated in its regulations and external correspondence the ethical corporate management policy and practices, as well as the active commitment of the Board of Directors and management towards enforcement of such policy? (2) Does the company have mechanisms in place to assess the risk of unethical conduct, and perform regular activities with higher risk of unethical conduct within the scope of business? Does the company implement programs to prevent unethical conduct based on the above and ensure the programs cover at least the matters described in Paragraph 2, Article 7 of the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies? (3) Does the company provide clearly the operating procedures, code of conduct, disciplinary actions, and appeal procedures in the programs against unethical conduct? Does the company enforce the programs above effectively and perform regular reviews and amendments?		No No No	Not yet determined Not yet determined Not yet determined
2. Fulfill operations integrity policy (1) Does the company evaluate business partners’ ethical records and include ethics-related clauses in business contracts? (2) Does the company have a unit responsible for ethical corporate management on a full-time basis under the Board of Directors which reports the ethical corporate management policy and programs against unethical conduct regularly (at least once a year) to the Board of Directors while overseeing such operations? (3)Does the company establishpolicies to prevent conflicts of interest and provide appropriate communication		No No	Not yet determined Not yet determined

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Evaluation Item	Implementation Status1	Implementation Status1	Implementation Status1
	Yes	No	Abstract Illustration
channels, and implement it? (4) Does the company have effective accounting and internal control systems in place to implement ethical corporate management? Does the internal audit unit follow the results of unethical conduct risk assessments and devise audit plans to audit the systems accordingly to prevent unethical conduct, or hire outside accountants to perform the audits? (5) Does the company regularly hold internal and external educational trainings on operational integrity?		No No No	Not yet determined Not yet determined Not yet determined
3. Operation of the integrity channel (1) Does the company establish both a reward/punishment system and an integrity hotline? Can the accused be reached by an appropriate person for follow-up? (2) Does the company have in place standard operating procedures for investigating accusation cases, as well as follow- up actions and relevant post-investigation confidentiality measures? (3) Does the company provide proper whistleblower protection?		No No No	Not yet determined Not yet determined Not yet determined
4. Strengthening information disclosure Does the company disclose its ethical corporate management policies and the results of its implementation on the company’s website andMOPS?		No	Not yet established
5. If the company has established the ethical corporate management policies based on the Ethical Corporate Management Best-Practice Principles for TWSE/TPEx Listed Companies, please describe any discrepancy betweenthe policies and their implementation.: Not yet determined.
6. Other importantinformationtofacilitate a betterunderstanding ofthe company’s ethicalcorporatemanagement policies (e.g.,review and amendits policies).

If the company has established the ethical corporate management policies based on the Ethical Corporate Management Best-Practice Principles for TWSE/TPEx Listed Companies, please describe any discrepancy between the policies and their implementation.: Not yet determined. 6. Other important information to facilitate a better understanding of the company’s ethical corporate management policies (e.g., review and amend its policies). Note 1: Regardless of whether the evaluation item is achieved or not, the company shall state an appropriate explanation.
3.4.10 If the Company Has Adopted Corporate Governance Best-Practice Principles or Related Bylaws, Disclose How These Are to Be Searched: None
3.4.11 Other Important Information Regarding Corporate Governance: None.
3.4.12 Resignation or Dismissal of the Company’s Key Individuals, Including the Chairman, CEO, and Heads of Accounting, Finance, Internal Audit, Corporate Governance and R&D in the Past Year and as of the Date of Publication of the Annual Report: None.
3.4.13 Establishment of Code of Conduct and Code of Ethics: None
3.4.14 A. The Status of Managerial Officers Participating in Continuous Education and

Training Regarding Corporate Governance:

Title	Name	Date	Course	Training Hours
Accounting Manager	CHEN SHU CHEN	October 5, 2022	Procedures and Practices for Self-prepared Financial Statements	3H
		October 27, 2022	Legal and Conceptual Knowledge for Corporate Financial Personnel	6H
		November 23, 2022	Key Revisions to the Regulations Regarding the Preparation of IFRS Financial Report	3H
Audit Accountant Manager	LU HUI PING	July 8, 2022	Practices for Internal Auditor to Audit Control Regarding Information Security	6H
		September 13, 2022	The Trend of Internet Technology Development and Innovative Thinking of Internal Auditor	6H
Auditor	TSENG CHEN YU	July 8, 2022	Practices for Internal Auditor to Audit Control Regarding Information Security	6H
		September 13, 2022	The Trend of Internet Technology Development and Innovative Thinking of Internal Auditor	6H

B. Summary of Resignations and Dismissals of Key Personnel of the Company: None
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3.4.15 Implementation Status of Internal Control

A. Statement on Internal Control

LILY TEXTILE CO., LTD.

Statement on Internal Control

Date: March 13, 2023

The Company (the Exchange) states the following with regard to its internal control system during fiscal year 2022, based on the findings of its self-assessment:

The Company (the Exchange) is fully aware that establishing, operating, and maintaining an internal control system are the responsibility of its Board of Directors and management. The Company (the Exchange) has established such a system aimed at providing reasonable assurance of the achievement of objectives in the effectiveness and efficiency of operations (including profits, performance, and safeguard of asset security), the reliability, timeliness, and transparency of reporting, and compliance with applicable norms and applicable laws, regulations, and bylaws.
An internal control system has inherent limitations. No matter how perfectly designed, an effective internal control system can provide only reasonable assurance of accomplishing the three objectives mentioned above. Furthermore, the effectiveness of an internal control system may change along with changes in environment or circumstances. The internal control system of the Company (the Exchange) contains self-monitoring mechanisms, however, and the Company (the Exchange) takes corrective actions as soon as a deficiency is identified.
The Company (the Exchange) judges the design and operating effectiveness of its internal control system based on the criteria provided in the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets (hereinbelow, the “Regulations”). The internal control system judgment criteria adopted by the Regulations divide internal control into five elements based on the process of management control: 1. control environment 2. risk assessment 3. control activities 4. information and communications 5. monitoring activities. Each element further contains several items. Please refer to the Regulations for details.
The Company (the Exchange) has assessed the design and operating effectiveness of its internal control system according to the aforesaid criteria.
Based on the findings of the assessment mentioned in the preceding paragraph, the Company (the Exchange) believes that as of 12,31,2022 its internal control system (including its supervision and management of subsidiaries and its overall implementation of information security), encompassing internal controls for understanding the degree of achievement of operational effectiveness and efficiency objectives, the reliability, timeliness, and transparency of reporting, and compliance with applicable norms and applicable laws, regulations, and bylaws, is—with the exception of the matters, if any, specifically listed in the Appendix— effectively designed and operating, and reasonably assures the achievement of the above-stated objectives.
This Statement is an integral part of Lily Logistics Development Co., LTD.’s annual report and prospectus, and will be made public. Any falsehood, concealment, or other illegality in the content made public will entail legal liability under Articles 20, 32, 171, and 174 of the Securities and Exchange Law.
This Statement has been passed by the Board of Directors Meeting of the Company (the Exchange) held on March 13, 2023, where ○ of the 9 attending directors (including independent directors) expressed dissenting opinions, and the remainder all affirmed the content of this Statement.

Lily Logistics Development Co., LTD.

Chairman: (signature) President: (signature)

Note 1: If during the fiscal year there has existed any material deficiency in the design and operation of the internal control system of the securities or futures industry service enterprise, an explanatory section shall be added after paragraph 4 of the Statement on Internal Control, listing and explaining any material deficiencies found in the self-assessment, and the corrective actions and status of corrections taken by the company up to the balance sheet date.

Note 2: The date of the statement is the fiscal year end date.

B. Where a CPA has been retained to conduct a special audit of the internal control system, the CPA audit report shall be disclosed: None

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3.4.16 If There Has Been Any Legal Penalty Against the Company Against Its Internal Personnel for Violation of the Internal Control System, in the Preceding Year and Up to the Publication Date of the Annual Report, the Annual Report Shall Disclose the Penalty, the Main Shortcomings, and Statement of Improvement: None

3.4.17 Major Resolutions of Shareholders’ Meeting and Board Meetings in the Past Year and as of the Date of Publication of the Annual Report: Shareholders’ Meeting

Date	Important Resolution Abstract	Resolution Result	Resolution Result	Implementation Status
6/15/2022	1. Proposal for 2021 Consolidated Financial Statements of the Company 2. Proposal for 2021 Profits and Deficit Compensation of the Company. 3. Renaming the Company and amendment to the Company Corporate Charter. Please proceed to discuss. 4. Amendment to the “Operational Procedures for Loaning of Company Funds.” Please proceed to discuss.	The voting result of this resolution is as follows: Total Votes (include E-voting exercise): 115,725,390 Shares % Approval: 114,853,325 (include E-voting exercise: 124,500) 99.24％ Disapproval: 5,768 (include E-voting exercise: 5,768) 0.00％ Invalid: 0 0.00％ Abstention: 866,297 (include E-voting exercise: 3,965) 0.74％ Resolution was adopted unanimously by the vote. The voting result of this resolution is as follows: Total Votes (include E-voting exercise): 115,725,390 Shares % Approval: 114,853,306 (include E-voting exercise: 124,481) 99.24％ Disapproval: 5,787 (include E-voting exercise: 5,787) 0.00％ Invalid: 0 0.00％ Abstention: 866,297 (include E-voting exercise: 3,965) 0.74％ Resolution was adopted unanimously by the vote. The voting result of this resolution is as follows: Total Votes (include E-voting exercise): 115,725,390 Shares % Approval: 114,853,315 (include E-voting exercise: 124,490) 99.24％ Disapproval: 5,778 (include E-voting exercise: 5,778) 0.00％ Invalid: 0 0.00％ Abstention: 862,297 (include E-voting exercise: 3,965) 0.74％ Resolution was adopted unanimously by the vote. The voting result of this resolution is as follows: Total Votes (include E-voting exercise): 115,725,390 Shares % Approval: 114,852,315 (include E-voting exercise: 123,490) 99.24％ Disapproval: 5,778 (include E-voting exercise: 5,778) 0.00％ Invalid: 0 0.00％		Execution completed according to the resolution of the Shareholders’ Meeting. Execution completed according to the resolution of the Shareholders’ Meeting. Execution completed according to the resolution of the Shareholders’ Meeting. Execution completed according to the resolution of the Shareholders’ Meeting.
		Shares	%
		Approval: 114,852,315 (include E-voting exercise: 123,490)	99.24％
		Disapproval: 5,778 (include E-voting exercise: 5,778)	0.00％
		Invalid: 0	0.00％

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	5. Amendment to the “Operating Procedures of Endorsement / Guarantees.” Please proceed to discuss. 6. Amendment to the “Procedures for Acquiring or Disposing of Assets.” Please proceed to discuss. 7. Amendment to “Procedures for Engaging in Derivatives Trading.” Please proceed to discuss. 8. Cancelation of the previous “Rules of Procedure for Shareholders Meetings” and to reestablish the “Rules of Procedure for Shareholders Meetings.” Please proceed to discuss.	Abstention: 867,297 (include E-voting exercise: 4,965)	0.74％
		Shares	%
		Approval: 114,852,119 (include E-voting exercise: 123,294)	99.24％

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Disapproval: 5,974 (include E-voting exercise: 5,974)	Disapproval: 5,974 (include E-voting exercise: 5,974)	Disapproval: 5,974 (include E-voting exercise: 5,974)	0.00％
Invalid: 0			0.00％
Abstention: 867,297 (include E-voting exercise: 4,965)			0.74％
Seats	ElectedTitle	Name	NumberofVotes
1	Director	SU TUNG YUNG	128,462,018
2	Director	SU CHIN YUAN	121,910,528
3	Director	SU PAI HUANG	115,373399
4	Director	SU TING KUEI	114,773,928
5	Director	SU TING HUNG	114,714,018
6	Director	LU HSUEH TUNG	114,111,643
7	Independent Director	SU TING	108,203,756
8	Independent Director	CHIEN HUA YUEH	107,578,696
9	Independent Director	LIEN SANHO	107,574,008
The voting result of this resolution is as follows: Total Votes (include E-voting exercise): 115,725,390 Shares % Approval: 114,848,935 (include E-voting exercise: 120,110) 99.24％ Disapproval: 5,028 (include E-voting exercise: 5,028) 0.00％ Invalid: 0 0.00％ Abstention: 871,427 (include E-voting exercise: 9,095) 0.74％ Resolutionwas adopted unanimously by the vote.

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Board of Directors’ Meeting

Date	Important Resolution Abstract	Resolution Result
03/22/2022 06/10/2022	1. Proposal for 2021 Consolidated Financial Statements of the Company 2. Proposal for 2021 Profits and Deficit Compensation of the Company. 3.Proposal for 2021 Statement on Internal Control of the Company. 4.Proposal for 2021 the dividend distribution of the Company. 5. Proposal for the 2021 remuneration of employee, directors, and supervisors. 6. The original application was loan commitments for the amount of NT$ 600,000,000 from SUNNY BANK, Yonghe Branch, and is now proposed to change the loan type to a medium-term financing guarantee. Please proceed to discuss. 7. Inspection of the Company’s sale of machinery to MIGHTY BUSINESS LTD and the execution of payment recovery. Please proceed to discuss. 8. The Company has developed a plan to improve the accounts receivable and long-term accounts receivable of its subsidiary, Kunshan Lily Textile Co. Please proceed to discuss. 9. Renaming the Company and amendment to the Company Corporate Charter. Please proceed to discuss. 10. Cancelation of the “Rules of Procedure for Shareholders Meetings” and to reestablish the “Rules of Procedure for Shareholders Meetings.” Please proceed to discuss. 11. Cancelation of the previous “Rules of Procedure for the Board of Directors” and to reestablish the “Rules of Procedure for the Board of Directors.” Please proceed to discuss. 12. Cancelation of the “Rules for Election of Directors and Supervisors” and to reestablish the “Procedures for Election of Directors.” Please proceed to discuss. 13. Amendment to the “Procedures for Acquiring or Disposing of Assets.” Please proceed to discuss. 14. Amendment to the “Operational Procedures for Loaning of Company Funds.” Please proceed to discuss. 15. Amendment to the “Operating Procedures of Endorsement / Guarantees.” Please proceed to discuss. 16. Amendment to the “Procedures for Engaging in Derivatives Trading.” Please proceed to discuss. 17. Establishment of Audit Committee Charter of the Company. Please proceed to discuss. 18. Purchase of Directors and Officers Liability Insurance Please proceed to discuss. 19. Re-election of all directors (including independent directors). 20. Handling the nomination of shareholder(s) holding 1% or more of the total number of outstanding shares of a company. Please proceed to discuss. 21. Nomination of candidates for the election as directors (including independent directors) for 2022. Please proceed to discuss. 22. Non-competition duty discharge of new directors. Please proceed to discuss. 23. Set of the date, venue, and other relevant matters for the convening of the 2022 General Meeting of Shareholders. Please proceed to discuss. 23. Handling of proposal proposed by shareholder(s) holding 1% or more of the total number of outstanding shares of a company. Please proceed to discuss. 1. The Company intends to loan US$2,100,000 to Kunshan Lily Textile Co.	As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. After being reviewed by the supervisor, it will be submitted to the General Meeting of Shareholders for approval. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. After being reviewed by the supervisor, it will be submitted to the General Meeting of Shareholders for approval. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. After being reviewed by the supervisor, it will be submitted to the General Meeting of Shareholders for approval. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be reported to the General Meeting of Shareholders. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be reported to the General Meeting of Shareholders. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be reported to the General Meeting of Shareholders. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be submitted to the General Meeting of Shareholders for discussion. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be submitted to the General Meeting of Shareholders for discussion. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be submitted to the General Meeting of Shareholders for discussion. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be submitted to the General Meeting of Shareholders for discussion. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be submitted to the General Meeting of Shareholders for discussion. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be submitted to the General Meeting of Shareholders for discussion. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved, and will be submitted to the General Meeting of Shareholders for election. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and

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Date	Important Resolution Abstract	Resolution Result
06/15/2022 07/22/2022 08/08/2022 11/08/2022	and hereby proposes the resolution. 2. Discussion of the 8th Meeting of the 4th Session of the Remuneration Committee of the Company and hereby proposes the resolution. 1. Proposed election of the Chairman of the Company. 2. Proposed appointment of the general manager of the Company. 3. Appointment of the members of the Company’s 5th Session Remuneration Committee and hereby proposes the resolution. 4. Proposed establishment of the Company’s Audit Committee and appointment of the first term members. 1. Discussion of the agenda item for the 1st Extraordinary Meeting of the 1st Session of the Company’s Audit Committee and hereby proposes the resolution. 2. Renaming of the Company and the exchange of securities certificates. Please proceed to discuss. 3. Change of the Company’s abbreviation. Please proceed to discuss. 4. Cancelation of branch office. Please proceed to discuss. 5. Discussion of the agenda item for the 1st Extraordinary Meeting of the 5th Session of the Company’s Remuneration Committee and hereby proposes the resolution. 1. Discussion of the 2nd Meeting of the 1st Session of the Audit Committee of the Company and hereby proposes the resolution. 2. The Company intends to loan US$2,100,000 to Kunshan Lily Textile Co. and hereby proposes the resolution. 3. The Company approved an assessment of line endorsement / guarantees for its affiliated company, Kunshan Lily Textile Co. in 2022 and hereby proposes the resolution. 4. The Company’s proposed extension of the loan amount from correspondent banks for 2022 and hereby proposes the resolution. 5. Proposal for the construction of the third phase warehouse building in Pingzhen Logistics Park. 6. Inspection of the Company’s sale of machinery to MIGHTY BUSINESS LTD and the execution of payment recovery. Please proceed to discuss. 7. The Company has developed a plan to improve the accounts receivable and long-term accounts receivable of its subsidiary, Kunshan Lily Textile Co. Please proceed to discuss. 8. Establishment of the schedule for greenhouse gas inventory and verification of the Company. Please proceed to discuss. 1. Discussion of the 3rd Meeting of the 1st Session of the Audit Committee of the Company and hereby proposes the resolution. 2. 2023 audit plan of the Company. Please proceed to discuss. 3. Amendment to the Rules of Procedure for the Board of Directors. Please proceed to discuss. 4. The Company intends to apply to the Bank of Taiwan, Yenping Branch for a short-term financing guarantee in the amount of NT$ 60,000,000. Please proceed to discuss. 5. Inspection of the Company’s sale of machinery to MIGHTY BUSINESS LTD and the execution of payment recovery. Please proceed to discuss. 6. The Company has developed a plan to improve the accounts receivable and long-term accounts receivable of its subsidiary, Kunshan Lily Textile Co. Please proceed to discuss. 7. Discussion of the 1st Meeting of the 5th Session of the Remuneration Committee of the Company and hereby proposes the resolution.	none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. Director SU CHIN YUAN nominated Director SU TUNG YUNG for re-election as Chairman. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. Director SU TING HUNG proposed the appointment of Director SU CHIN YUAN as the General Manager of the Company. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved. As the person presiding the Board meeting puts the matter before all directors present at the meeting for seeking their comments and none voices an objection, the matter is deemed approved.

3.4.18 Where, during the most recent fiscal year or during the current fiscal year up to the date of publication of the annual report, a director or supervisor has expressed a dissenting opinion with respect to a material resolution passed by the board of directors, and said dissenting opinion has been recorded or prepared as a written declaration, disclose the principal content thereof: None

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Other Matters Required to be Recorded:

A.If any of the following circumstances exists, specify the board meeting date, meeting session number, content of the motion(s), the opinions of all the independent directors, and the measures taken by the Company based on the opinions of the independent directors:

	session number, content of the motion(s), the opinions of all the independent directors, and the measures taken by the Company based on the opinions of the independent directors:	session number, content of the motion(s), the opinions of all the independent directors, and the measures taken by the Company based on the opinions of the independent directors:	session number, content of the motion(s), the opinions of all the independent directors, and the measures taken by the Company based on the opinions of the independent directors:	session number, content of the motion(s), the opinions of all the independent directors, and the measures taken by the Company based on the opinions of the independent directors:
	1. Any matter under Article 14-3 of the Securities and Exchange Act.
Date	Session Number	Resolution Content	All Independent Directors’ Opinion	Measures Taken by the Company Based on the Opinions of the Independent Directors
03/22/2022	The 13th Meeting of the 15thSession of the Board of Directors	1. Inspection of the Company’s sale of machinery to MIGHTY BUSINESS LTD and the execution of payment recovery. Please proceed to discuss. 2. The Company has developed a plan to improve the accounts receivable and long- term accounts receivable of its subsidiary, Kunshan Lily Textile Co. Please proceed to discuss. 3. The original application was loan commitments for the amount of NT$600,000,000 from SUNNY BANK, Yonghe Branch, and is now proposed to change the loan type to a medium-term financing guarantee. Please proceed to discuss.	None None None	Resolution adopted Resolution adopted Resolution adopted
05/05/2022	The 14~~th~~ Meeting of the 15thSession of the Board of Directors	1. The Company intends to loan US$ 2,500,000 to Kunshan Lily Textile Co. and hereby proposes the resolution. 2. The Company intends to apply loan commitments for the amount of NT$1500,000,000 from SUNNY BANK, Yonghe Branch, and is now proposed to change the loan type to a long-term and short- term financing loan. Please proceed to discuss.	None None	Resolution adopted Resolution adopted
06/10/2022	The 15~~th~~ Meeting of the 15thSession of the Board of Directors	1. The Company intends to refinance the loan with Kunshan Lily Textile Co. and hereby proposes the resolution.	None	Resolution adopted
08/08/2022	The 2~~nd~~ Meeting of the 16thSession of the Board of Directors	1. The Company intends to loan US$ 2,500,000 to Kunshan Lily Textile Co. and hereby proposes the resolution. 2. The Company approved an assessment of line endorsement / guarantees for its affiliated company, Kunshan Lily Textile Co. in 2022 and hereby proposes the resolution. 3. The Company’s proposed extension of from correspondent banks for 2022 and hereby proposes the resolution. 4. Proposal for the construction of the third phase warehouse building in Pingzhen Logistics Park. 5. Inspection of the Company’s sale of machinery to MIGHTY BUSINESS LTD and the execution of payment recovery. Please proceed to discuss. 6. The Company has developed a plan to improve the accounts receivable and long-term accounts receivable of its subsidiary, Kunshan Lily Textile Co. Please proceed to discuss.	None None None None None	Resolution adopted Resolution adopted Resolution adopted Resolution adopted Resolution adopted
11/08/2022	The 3~~rd~~ Meeting of the 16thSession of the Board of Directors	1. Inspection of the Company’s sale of machinery to MIGHTY BUSINESS LTD and the execution of payment recovery. Please proceed to discuss. 2. The Company has developed a plan to improve the accounts receivable and long-term accounts receivable of its subsidiary, Kunshan Lily Textile Co. Please proceed to discuss.	None None	Resolution adopted Resolution adopted

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3.5 Information Regarding the Company’s Audit Fee

Accounting Firm	Name of CPA	Name of CPA	Period Covered by CPA’s Audit	Remarks
Crowe (TW) CPAs	CHEN KUEI MEI	WANG WU CHANG	01/01/2022 ~ 12/31/2022

Note: If the company has changed CPA or Accounting Firm during the current fiscal year, the company shall report the information regarding the audit period covered by each CPA and the replacement reason.

				Unit: NT$ thousands
Fee Items Fee Range		Audit Fee	Non-audit Fee	Total
1	Under NT$ 2,000,000	1,615	91	1,706
2	NT$ 2,000,000 (incl.)~NT$ 4,000,000
3	NT$ 4,000,000 (incl.)~NT$ 6,000,000
4	NT$ 6,000,000 (incl.)~NT$ 8,000,000
5	NT$ 8,000,000 (incl.) ~ NT$ 100,000,000
6	Over NT$ 100,000,000

Information Regarding the Company’s Audit Fee

								Unit: NT$ thousands	Unit: NT$ thousands
Accounting Firm	Name of CPA	Audit Fee		Non-audit Fee				Period Covered by CPA’s Audit	Remarks
			System of Design	Company Registration	Human Resource	Others (Note 2)	Subto tal

Crowe (TW) CPAs	CHEN KUEI MEI, WANG WU CHANG	1,615	-	13	-	78	91	January 2022 ~ December 2022

Note 1: If the company changed its CPAs or accounting firm during the fiscal year, list the audit periods before and after the change separately and specify the reason for the change in the “Remarks” column and disclose sequentially the audit and non-audit fees paid.
Note 2: Please specify the services for which the non-audit fees were paid. If the “Others” among the non-audit fees reaches 25% of the total amount of non-audit fees, specify the content of the services in the “Remarks” column.
3.6 When the Securities Firm Changes Its Accounting Firm and the Audit Fees Paid For the Financial Year in which the Change Took Place are Lower than Those Paid For the Financial Year Immediately Preceding the Change, the Amount of the Audit Fees Before and After the Change and the Reason Shall Be Disclosed:
1.When non -audit fees paid to the certified public accountant, to the accounting firm of the certified public accountant, or to any affiliate of such accounting firm are one quarter or more of the audit fees, the amounts of both audit and non -audit fees as well as details of non - audit services shall be disclosed: None
When the securities firm changes its accounting firm and the audit fees paid for the financial year in which the change took place are lower than those paid for the financial year immediately preceding the change, the amount of the audit fees before and after the change and the reason shall be disclosed: None
If the audit fees, disclose the ratio, and the reasons of the audit fees: None When the audit fees paid for the current financial year are lower than those paid for the immediately preceding financial year by 15 percent or more, the amount and percentage of and reason for the reduction in audit fees shall be disclosed: None
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3.7 Information on Replacement of CPAs:

3.7.1 Information regarding the former CPAs

Date of replacement	Not applicable	Not applicable	Not applicable	Not applicable	Not applicable
Reason for replacement and explanation	Internal CPAs’ rotation
Describe whether the Company terminated of the CPAs terminated or did not accept the engagement	Parties Circumstances			CPAs	The Company
	Terminated the engagement			Not applicable	Not applicable
	No longer accepted (discontinued) the engagement			Not applicable	Not applicable
If the CPAs issued an audit report expressing any opinion other than an unqualified opinion during the 2 most recent years, specify the opinion and thereasons	No
Disagreement with the Company?	Yes		Accounting principles orpractices
			Disclosure of financial reports
			Audit scope or steps
			Others

	No	V
	Specifydetails
Other disclosures (Any matters required to be disclosed under sub-items d of Article 10.5A)	Not applicable

3.7.2 Information regarding the Successor CPAs

Name of accounting firm	Not applicable
Name of CPAs
Date of engagement
Subjects discussed and results of any consultation with the CPAs prior to the engagement, regarding the accounting treatment of or application of accounting principles to any specified transaction, or the type of audit opinion that might be issued on the company'sfinancial report
Successor CPAs’ written opinion regarding the matters of disagreement between the Company and the former CPAs

3.7.3 The reply letter from the former CPA regarding the Company’s disclosures regarding the matters under Article 10.5.A and 10.5.B(c) of the Regulations: None.
3.8 The Employment of the Company’s Chairman, General Manager, Financial or Accounting Manager with the Firm of the Auditing CPA or Its Affiliated Businesses in the Past Year: None.
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3.9 Particulars about Changes in Shareholding and Equity Pledge of Directors, Supervisors, Managers and Shareholders Holding More Than 10% of the Company’s Shares in the Past Year and as of the Date of Publication of the Annual Report:

Changes in Shareholding of Directors, Supervisors, Managerial Officers, and Major


	Job title (Note 1)		Name		2022				Currentfiscalyearas of March31
					Shareholding increase (or decrease)		Pledged shareholding increase (or decrease)		Shareholding increase (or decrease)	Pledged shareholding increase (or decrease)
	Chairman Director Director’s spouse		SU TUNG YUNG SU CHIN YUAN LU MING FEN		(156,000) 1,461,200 (23,000)		0 0 0		0 330,000 0	0 0 0
Name (Note 1)		Reason for transfer (Note 2)		Date of transaction		Counterparty		Relationship between the counterparty and the Company, directors, supervisors, managerial officers, and major shareholders			No. of shares	Transaction price
SU TUNG YUNG		Donation		03/16/2022		SU TZU YU SU HSIN PO SU FENG CHIEH		Minor grandson of the director Minor grandson of the director Minor grandson of the director			52,000 52,000 52,000	Donation Donation Donation

Note 1: Fill in the names of the directors, supervisors, and managerial officers, and the shareholders with greater than 10 percent shareholding.

Note 2: Specify whether the shares are acquired or disposed of.

Shares Pledge with Related Parties

Name (Note 1)	Reason for change in pledge status (Note 2)	Date of change	Counterparty	Relationship between the counterparty and the Company, directors, supervisors, managerial officers, and major shareholders	Shares	Shares holding %	Shares Pledged %	Pledged Amount
None

33 -

3.10 Relationship Information, If Any of the 10 Largest Shareholders is a Related Party as Defined in Statement of Financial Accounting Standards No. 6, or Spouse, or Relative Within the Second Degree of Kinship:

Relationship among the Top Ten Shareholders

	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate	April 15,2023 Shareholding Shareholding of spouse and minor children Total shareholding by nominee arrangements Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree Remarks Shares % Shares % Shares % Name of entityor individual Relationship 13,267,000 9.80% 0 0 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate 12,120,000 8.95% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 10,024,000 7.61% 0 0 0 0 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 8,987,298 6.64% 0 0 0 0 None The Company’s director and general manager 8,438,958 6.23% 100,000 0.07 0 0 None The Company’s director and general manager 7,100,692 5.24% 871,000 0.64 SU TUNG YUNG, SU TING HUNG Father-son, brotherhood None 6,112,000 4.51% None The Company’s director and general manager 5,820,072 4.30% 88,020 0.07 0 0 SU TING HUNG、SU HAO I Father-son The Company’s director and chairman 5,257,993 3.88% 0 0 0 0 None None 5,230,597 3.86% 870,000 0.64 0 0 SU TUNG YUNG、SU HAO I Father-son, brotherhood The Company’s associate
Name	Shareholding		Shareholding of spouse and minor children		Total shareholding by nominee arrangements		Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative withinthe2nd degree		Remarks
	Shares	%	Shares	%	Shares	%	Name of entityor individual	Relationship
SUNNY LOGISTICS CO., LTD. Representative: SU TING HUNG	13,267,000	9.80%	0	0	0	0	SU TUNG YUNG、SU HAO I	Father-son, brotherhood	The Company’s associate
RITER SHUN TRADING COMPANY LIMITED Representative: SUHAOI	12,120,000	8.95%	0	0	0	0	SU TUNG YUNG, SU TING HUNG	Father-son, brotherhood	None
HSIN YUNG INVESTMENT CO., LTD. Representative: SUHAOI	10,024,000	7.61%	0	0	0	0	SU TUNG YUNG, SU TING HUNG	Father-son, brotherhood	None
I SHENG INVESTMENT CO., LTD. Representative: SU CHINYUAN	8,987,298	6.64%	0	0	0	0	None		The Company’s director and general manager
SU CHIN YUAN	8,438,958	6.23%	100,000	0.07	0	0	None		The Company’s director and general manager
SU HAO I	7,100,692	5.24%	871,000	0.64			SU TUNG YUNG, SU TING HUNG	Father-son, brotherhood	None
I SHUN INVESTMENT CO., LTD. Representative: SU CHIN YUAN	6,112,000	4.51%					None		The Company’s director and general manager
SU TUNG YUNG	5,820,072	4.30%	88,020	0.07	0	0	SU TING HUNG、SU HAO I	Father-son	The Company’s director and chairman
SU CHANG SHENG	5,257,993	3.88%	0	0	0	0	None		None
SU TING HUNG	5,230,597	3.86%	870,000	0.64	0	0	SU TUNG YUNG、SU HAO I	Father-son, brotherhood	The Company’s associate

34 -

3.11 The Total Number of Shares and Total Equity Stake Held in Any Single Enterprise By the Company, Its Directors and Supervisors, Managerial Officers, and Any Companies Controlled Either Directly or Indirectly By the Company:

Total Ownership of Shares in Investee Enterprises

	Unit: shares;%	Unit: shares;%	Unit: shares;%	Unit: shares;%	Unit: shares;%	Unit: shares;%
Investee enterprise (Note)	Investment by the Company		Investment by the Directors, Supervisors, Managerial Officers and Directly or Indirectly Controlled Entities ofthe Company		Total Investment
	Shares	%	Shares	%	Shares	%
GIANTEX TEXTILECORPORATION	26,817,816	46.27%	4,320,158	7.45%	31,137,974	53.73%
GisongEnterprise Corporation	11,400,000	57.00%	300,000	1.50%	11,700,000	58.50%
LILYNETWORKCORP.	4,440,000	98.67%	30,000	0.67%	4,470,000	99.33%
LILYTEX INTERNATIONALCORP.	12,60,000	55.21%	0	0	12,60,000	55.21%
NIGHTY BUSINESS LTD.	1,000	100.00%	0	0	1,000	100.00%

Note: This refers to investee enterprises in which the Company makes long-term investment calculated according to the equity method.

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IV. Capital Overview

4.1 Capital and Shares

4.1.1 Sources of Capital

IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital	IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital	IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital	IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital	IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital	IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital	IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital	IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital	IV. Capital Overview 4.1 Capital and Shares 4.1.1 Sources of Capital
Unit: NT$thousands
Month/ Year	Per Value (NT$)	~~Authorized Capital~~		~~Paid-in Capital~~		~~Remark~~
		Shares	Amount (NT$ thousands)	Shares	Amount (NT$ thousands)	Sources of Capital	~~Capital~~ Increased by Assets Other than Cash	Other
~~1972/11~~	~~100~~	~~360,000~~	~~36,000,000~~	~~360,000~~	~~36,000,000~~	~~Capital when found~~	~~-~~	~~-~~
~~1999/08~~	~~10~~	~~353,000,000~~	~~3,530,000,000~~	~~301,090,042~~	~~3,010,900,420~~	~~Capital surplus to~~ increase capitalization NT$143,376,210	~~-~~	~~-~~
~~2009/12~~	~~10~~	~~353,000,000~~	~~3,530,000,000~~	~~293,772,942~~	~~2,937,729,420~~	~~Stock repurchase~~ NT$73,171,000	~~-~~	~~-~~
~~2011/01~~	~~10~~	~~353,000,000~~	~~3,530,000,000~~	~~291,264,942~~	~~2,912,649,420~~	~~Stock repurchase~~ NT$25,080,000	~~-~~	~~-~~
~~2011/08~~	~~10~~	~~353,000,000~~	~~3,530,000,000~~	~~135,343,011~~	~~1,353,430,110~~	~~Capital reduction~~ NT$1,559,219,310	~~-~~

Note 1: Disclose the information for the current fiscal year up to the date of publication of the annual report. Note 2: For a capital increase, specify the date and reference number of the official letter under which the increase was effectively registered (or approved). Note 3: If any stock is issued at less than par value, this should be prominently indicated.

Note 4: If capital is paid in by offsetting monetary claims or technology against the price of shares, please specify, and also note the type and monetary amount of the offset. Note 5: If it is a private placement, the fact that it is a private placement should be prominently indicated.

Note 6: The approval letter, the Letter No. Ministry-of-Economic-Affairs-Commerce-Department-09801295290 received on December 24, 2009. Note 7: The approval letter, the Letter No. Ministry-of-Economic-Affairs-Commerce-Department-10001006860 received on January 12, 2011. Note 7: The approval letter, the Letter No. Ministry-of-Economic-Affairs-Commerce-Department-10001180700 received on August 12, 2011.

Type of Stock and Authorized Capital

	Type of Stock and Authorized Capital	Type of Stock and Authorized Capital	Type of Stock and Authorized Capital	Type of Stock and Authorized Capital
	April 30,2020 Unit: shares
Type of Stock	Authorized Capital			Remarks
	Outstanding Shares (Note)	Unissued Shares	Total
Common Shares	135,343,011	217,656,989	353,000,000	The unissued shares include 5,000,000 stock warrants that can be used for subscription of shares

Note: Note whether the stock is stock of a TWSE or TPEx listed company (if it is a company under restrictions with respect to TWSE or TPEx listing/trading, this should be noted).

36 -

4.1.2 Status of Shareholders

					April 15,2023	April 15,2023
Shareholder composition	Government				Foreign institutions and
		Financial institutions	Other legal entities	Individuals		Total
Quantity	agencies				foreign individuals

No. of shareholders	0	0	141	22,084	18	22,234
No. of shares held	0	0	57,443,169	77,264,911	634,931	135,343,011
Shareholding ratio	0%	0%	42.44%	57.09%	0.47%	100%

Note: 1. NT$10 per share.

2. The Company has not issued preferred stock.

4.1.3 Distribution of Shareholding

1.3 Distribution of Shareholding
		April 15,2023
Range of no. of shares held	No. of shareholders	Shareholding (shares)	Shareholding (%)

1 to 999	19,846	2,190,600	1.62%
1,000 to 5,000	1,818	3,442,156	2.54%
5,001 to 10,000	223	1,602,449	1.18%
10,001 to 15,000	102	1,084,012	0.80%
15,001 to 20,000	44	709,317	0.53%
20,001 to 30,000	56	1,060,707	0.78%
30,001 to 40,000	29	996,657	0.74%
40,001 to 50,000	18	880,144	0.65%
50,001 to 100,000	39	2,949,407	2.18%
100,001 to 200,000	13	2,115,009	1.56%
200,001 to 400,000	17	4,862,761	3.59%
400,001 to 600,000	13	6,957,577	5.14%
600,001 to 800,000	6	5,576,094	4.12%
800,001 to 1,000,000	2	2,608,000	1.93%
Add additional ranges above 1,000,001, if necessary, based onactualcircumstances	17	101,195,321	74.77%
Total	22,243	135,343,011	100.00%

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4.1.4 List of Major Shareholders

ist of Major Shareholders
	April 15,2023
Shares
	Shareholding (shares)	Shareholding (%)
Names of majorshareholders

SUNNY LOGISTICS CO., LTD	13,267,000	9.80%
LITER SHUN TRADING CO.MPANY LIMITED	12,120,000	8.95%
HSIN YUNG INVESTMENT CO., LTD.	10,300,000	7.61%
I SHENG INVESTMENT CO., LTD.	8,987,298	6.64%
SU HAO I	8,438,958	6.23%
SU CHIN YUAN	7,100,692	5.24%
I SHUN INVESTMENT CO., LTD.	6,112,000	4.51%
SU TUNG YUNG	5,820,072	4.30%
SU CHANG SHENG	5,257,993	3.88%
SU TING HUNG	5,230,597	3.86%

4.1.5 Preferred Stock: None

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4.1.6 Market Price, Net Worth, Earnings, and Dividends per Share for the Most Recent 2 Fiscal Years

Item	Fiscal year	Fiscal year	2021	2022	Current year to March 31 (Note 8)
Market price per share (Note 1)	Highest		18.45	22.75	32.40
	Lowest		10.65	15..00	28.80
	Average		14.18	17.85	30.23
Net worth per share (Note2)	Before distribution		10.56	12.48	13.31
	After distribution		10.56	12.48	13.31
Earnings per share	Weightedaverage shares		134,882,401	134,882,401	134,882,401
	Earnings pershare		1.65	1.67	0.25
Dividends per share	Cashdividends		-	-	-
	Stock dividends	-	-	-	-
		-	-	-	-
	Accumulated undistributed dividends (Note 4)		-	-	-
Return on investment analysis	Price/ earnings ratio (Note 5)		8.59	10.69	120.92
	Price/dividendratio (Note 6)		-	-	-
	Cash dividendyield(Note 7)		-	-	-

Note 1: List the highest and lowest market price of common shares in each fiscal year and calculate the average market price by weighing transacted prices against transacted volumes in each respective fiscal year.

Note 2: Calculate the net worth per share based on the number of outstanding shares at year�end. Calculate the amount of distribution based on the amount resolved by the board of directors or resolved in the next year's shareholders meeting.

Note 3: If retrospective adjustments are required because of issuance of stock dividends, the earnings per share should be disclosed in the amounts before and after the retrospective adjustments.

Note 4: If equity securities are issued with terms that allow undistributed dividends to be accrued and accumulated until the year the Company makes profit, the amount of cumulative undistributed dividends up until the current year should be disclosed separately.

Note 5: Price / earnings ratio = average closing price per share for the year / earnings per share.

Note 6: Price / dividend ratio = average closing price per share for the year / cash dividends per share. Note 7: Cash dividend yield = cash dividend per share / average closing price per share for the year.

Note 8: Net worth per share and earnings per share are based on audited (auditor-reviewed) data as at the latest quarter before the publication date of the annual report. For all other P. 60 of 93 fields, calculations are based on the data for the current year as of the date of publication of the annual report.

39 -
4.1.7 Dividend Policy and Implementation Status
- A. Company’s dividend policy and implementation thereof
  - In accordance with the Article 29-1 of the Articles of Incorporation: The Company, when allocating its surplus profits after having paid all taxes and dues, shall first set aside 10% of said profits as legal reserve. Where such legal reserve amounts to the total paid-in capital, this provision shall not apply. The special surplus reserve is proposed or reversed in accordance with the relevant laws and regulations. If there is a balance, and the available distributed surplus calculated from the undistributed surplus at the beginning of the period (including adjustment of the undistributed surplus amount), the Board of Directors proposes a surplus distribution case, which is distributed after the resolution of the shareholders' meeting. The Company’s dividend policy is in line with the expansion of its business scale, taking into account the Company’s capital expenditure and operational turnover requirements. Dividends to shareholders may be distributed in either cash or stock, with the cash dividend not to be less than 10% of the total dividend to shareholders.
- B. No allotment of shares proposed at the preceding shareholders’ meeting
4.1.8 Effect Upon Business Performance and Earnings Per Share of Any Stock Dividend Distribution Proposed or Adopted at the Most Recent Shareholders’ Meeting: There was no share allotment at the Company’s General Shareholders’ Meeting, so there was no impact.
4.1.9 Compensation of Employees, Directors, and Supervisors
1. The percentages or ranges with respect to employee, director, and supervisor compensation, as set forth in the Articles of Incorporation: If the Company has gained profits within a fiscal year, not to be less than 3% shall be reserved as the employees’ compensation. The employees' compensation can be obtained by stock or cash, and the object of the employee's compensation is to include the employees of the subordinate company that meet the conditions set by the Board of Directors. The Company may set aside up to 3% of the above-mentioned profit to be reserved as the directors’ and supervisors’ compensation by resolution of the Board of Directors. The distribution of employees’ compensation and directors’ compensation should be reported at the Shareholders’ Meeting. However, in case of the accumulated losses, certain profits shall be reserved to cover them, and the compensation to employees, directors, and supervisors shall be reserved in proportion to the aforementioned amount.
2. Information of the amount of directors and supervisors compensation approved by the board of directors for distribution: No allotment.
3. The actual distribution of employee, director, and supervisor compensation for the preceding fiscal year: No allotment.
4.1.10 Repurchase of the Company’s Own Shares: None
4.2 Repurchase of the Company’s Own Shares: None
4.3 Corporate Bonds: None
4.4 Information of Convertible Bond: None
4.5 Information of Exchangeable Bond: None
4.6 Shelf Registration for Issuance of Corporate Bonds: None
4.7 Information about Corporate Bonds with Warrants: None
4.8 Preferred Shares: None
4.9 Information about Preferred Bonds with Warrants: None
4.10 Overseas Depositary Receipts: None
4.11 Employee Share Subscription Warrants: None
4.12 New Restricted Employee Shares: None
4.13 Names and Acquisition and Subscription Status of Managerial Officers Who Have Acquired Employee Share Subscription Warrants and the Top Ten Employees (Ranked by the Number of Subscribe Shares) Who Have Acquired Share Subscription Warrants: None
4.14 Basic Information on Companies That Are Merged or Acquired or Whose Shares Are Acquired by the Company: None
4.15 Financing Plans and Implementation:
4.15.1 Plans Content: None
4.15.2 Status of Implementation: None
40 -

V. Operations Profile

5.1 Business Content

5.1.1 Business Scope
Main areas of business operations:
- (1) Spinning, weaving, processing, buying, selling, bidding, and agency services for natural cotton, Artificial Fiber, and various chemical fibers.
- (2) Commissioning construction contractors to build commercial buildings and national housing for rent or sale, as well as developing industrial zones approved by the industrial supervisory authority.
- (3) Import and wholesale of alcoholic drinks.
- (4) General import and export trade and agency services. (Excluding those that are subject to special approval)
- (5) IZ06010 Cargoes Packaging.
- (6) G801010 Warehousing.
Revenue distribution:

Total revenue: Logistics center 48.85%, textile fiber 37.45%, trading 13.70%.

5.1.2 Industry Overview:
The two warehouse buildings of the first phase constructed by the Company in the Pingzhen Logistics Park have officially entered operation. As the new buildings come into operations, the Company is able to maintain its earnings after-tax.
5.1.3 Research and Development: None
5.1.4 Long-term and Short-term Development
The warehouse building to be constructed in the Yangmei Logistics Park is expected to be operational in 2023. In addition to the operations in the logistics business, the Company does not rule out the possibility of developing its trading business to generate higher profits.

5.2 Market and Sales Overview

5.2.1 Market Analysis
A. Supply and demand of the market in the future:
- Due to the high cost of land acquisition in the domestic market, it is not feasible to construct warehouse buildings with the land currently available, as it would not be able to attract customers. However, since the Company acquired its land in earlier years, the construction costs for building new warehouse buildings are significantly lower, providing it with a competitive advantage over its peers in the domestic warehousing and logistics industry.
B. Business objectives:

In response to the needs of the domestic market, the Company will focus on its operations on the logistics center as the main trading business to generate more profits as the primary goal.

C. Favorable and unfavorable factors in the long term:
(1) Negative industry factors

Due to the recent influx of large domestic consortia into the market, many of these consortia have intervened in the logistics industry through real estate roles, causing disruption in the entire market, which is unfavorable to the industry itself.

(2) Positive company factors
<1> As e-commerce and online shopping continue to experience sustained growth worldwide, there is a strong demand for the storage, handling, and distribution of goods under this borderless procurement model, creating favorable conditions for logistics development.
41 -
- <2> Development of value-added business and new market exploration.
- <3> AV stable personnel organization. By providing staff training, we aim to enhance their technical skills and productivity.
- <4> Maintaining high-quality services as well as lowering the unit production cost.
- <5> The Company maintains a stable financial policy and structure.
- <6> Our service portfolio is customer-oriented, with the aim of maximizing our operating profit by remaining flexible and adjusting to meet their need.
5.2.2 A. Production Procedures of Main Products:
Major products and their production processes:

Purchase and stock-in operations ──→ Goods stock-out operations ──→ Goods processing operations ──→ Goods distribution operations ──→ Customer message reply ──→ Goods return operations

a. Supply status of main materials: Please refer to the major suppliers in the last two fiscal years on the next page for the supply status of raw materials for textiles. Warehousing and logistics is seen as service business, so no raw material supply status is not applicable.
5.2.3 Clients Accounting for 10 percent or More of the Total Procurement (sales) Amount in Either of the Preceding Two Fiscal Years: Sales: A, B, C
- Purchases: 甲
42 -

Information on Major Customers for the Most Recent 2 Fiscal Years

Unit: NT$ thousands; %

													Unit: NT$thousands;%	Unit: NT$thousands;%	Unit: NT$thousands;%	Unit: NT$thousands;%	Unit: NT$thousands;%	Unit: NT$thousands;%	Unit: NT$thousands;%
	2021						2022						Up to the first quarter of the current fiscal year
Item	Name		Amount		Percentage of annual net sales 〔%〕	Relationship with the issuer	Name	Amount	Percentage of annual net sales 〔%〕		Relationship with the issuer		Name	Amount		Percentage of net sales up to the preceding quarter of the current fiscal year 〔%〕		Relationship with the issuer
1	A		130,890		24.42	None	A	208,522	36.08		None		A	65,857		46.04		None
2	B		71,454		13.33	None	B	64,084	11.09		None		B	15,599		10.90		None
3	C		58,051		10.83	None	C	58,556	10.13		None		C	14,353		10.23		None
11	Others		275,544		51.42		Others	246,797	42.70				Others	47,247		33.03
	Net sales		535,939		100.00		Net sales	577,959	100.00				Net sales	143,056		100.00
Information on Major Suppliers for the Most Recent 2 Years Unit: NT$thousands;%
	2021						2022					Up to the first quarter of the current fiscal year
Item	Name	Amount		Percentage of annual net sales 〔%〕		Relationship with the issuer	Name	Amount		Percentage of annual net sales 〔%〕	Relationship with the issuer	Name			Amount		Percentage of net purchases up to the preceding quarter of the current fiscal year 〔%〕		Relationship with the issuer
1	甲	59,744		18.01		None	甲	31,402		10.07	None	None
2	乙	51,238		15.45
3	Others	220,739		66.54			Others	280,366		89.93		Others			68,275		100.00
	Netpurchases	331,721		100.00			Netpurchases	311,768		100.00		Netpurchases			68,275		100.00

Note 1: List all suppliers accounting for 10 percent or more of the Company's total procurement amount in the 2 most recent fiscal years and the amounts bought from each and the percentage of total procurement accounted for by each. If the company is prohibited by contract from revealing the name of a supplier, or a trading counterparty is an individual person who is not a related party, it may use a code in place of the actual name.

43 -

5.2.4 Production Volume and Value in the Most Recent Two Fiscal Years

Unit: NT$ thousands

				Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands
Fiscal Year Output Main Products	2021			2022
	Capacity	Quantity	Amount	Capacity	Quantity	Amount
CoveredYarn(KG)	1,889,435	1,889,435	213,147	1,302,890	1,302,890	169,730
Total - KG	1,889,435	1,889,435	213,147	1,302,890	1,302,890	169,730

Note 1: Production capacity refers to the quantity that the Company can produce using existing production facilities in normal operations, after consideration of factors such as necessary suspensions of operations and holidays.

Note 2: If there is substitutability in the production of any products, they may be calculated on a consolidated basis, and an explanatory note should be provided.

5.2.5 Sales Volume and Value in the Most Recent Two Fiscal Years

Unit: NT$ thousands

					Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands
Year Sales Department	2021				2022
	Local		Export		Local		Export
	Volume	Amount	Volume	Amount	Volume	Amount	Volume	Amount
-KG	2,292,258	322,384	14,279	2,299	1,308,110	216,218	19,940	3,828
Logistics Department	-	423,425	-	-	-	589,950	-	-
Other Business Department	-	118,709	-	-	-	37,704	-	-
Total	,292,258	864,518	14,279	2,299	1,308,110	543,672	19,940	3,828

5.3 Employee Statistics

March 31, 2023

				March 31,
	Fiscal year	2021	2022	As of March 31 of the currentfiscalyear
Numb er of emplo yees	Technician	50	70	72
	Officer	28	26	26
	Employee	6	6	6
	Total	84	102	104
	Average age	41.1	45.2.	45.1
Average years ofservice		12.7	13.1	13.1
Educat ion distrib ution percen tage (%)	Ph.D.	-
	Master’s degree	2	2	2
	College	52	62	62
	Senior highschool	27	34	34
	Below senior high school	3	4	4

44 -

5.4 Environmental Protection Expenditure:

5.4.1 Any Losses suffered in the Most Recent Two Fiscal Years Due to Environmental Pollution: None
5.4.2 Countermeasures:

The Company has always been proactive in maintaining and creating a safe and comfortable working environment, and we continuously strengthen our efforts to promote environmental protection and hygiene through information and inspections.

5.5 Collective Bargaining Agreement Status:

5.5.1 Employee welfare policy, retirement system, and important collective bargaining agreement:
Work environment and protection for the physical safety of workers:
- (1) Smoking is prohibited in the plant.
- (2) Forklift drivers must have a certificate of completion template issued by a qualified training institution.
- (3) Pumping equipment should be with residual current circuit breaker.
Employee welfare policy:
- The Company has an Employee Welfare Committee, which provides various benefits to employees in accordance with relevant regulations, including marriage subsidy, medical emergency and funeral assistance, holiday bonus, and travel allowance.
Retirement system and implementation status:
- (1) The Company has established employee retirement procedures in accordance with the Labor Standards Act and has set up Supervisory Committee of Business Entities’ Labor Retirement Reserve to carry out retirement-related matters for employees.
- (2) Employers shall appropriate labor pension reserve funds at a certain ratio of the total monthly wages of their employees and deposit such amount in a designated account covered by the Labor Standards Act.
- (3) Employers shall on a monthly basis contribute labor pension funds to individual labor pension accounts at the Bureau of Labor Insurance for employees covered by the Enforcement Rules of the Labor Pension Act starting from 07/01/2005.
5.5.2 Any Losses Suffered Due to Labor Dispute in the Most Recent Two Fiscal Years, Current or Future Potential Losses or Countermeasures: None

5.6 Important Contracts: None

45 -

VI. Financial Information

6.1 Condensed Balance Sheet, Statement of Comprehensive Income Condensed Balance Sheet for the Past Five Years and Audit Opinion from CPAs

6.1.1 Condensed Balance Sheet and Statement of Comprehensive Income Condensed Balance Sheet

(1) Condensed Balance Sheet

Unit: NT$ thousands

Fiscal year Item	Fiscal year Item	Financial information for MostRecent 5Fiscal Years	Financial information for MostRecent 5Fiscal Years	Financial information for MostRecent 5Fiscal Years	Financial information for MostRecent 5Fiscal Years	Financial information for MostRecent 5Fiscal Years	Financial information as of March 31 of the currentfiscalyear
		2018	2019	2020	2021	2022
Current asset		745,405	656,357	642,919	731,367	595,350	558,195
Property, plant and equipment		2,806,944	3,194,478	3,608,543	4,044,550	4,409,349	4,428,058
Intangible assets		0	0	0	0	0	0
Otherassets		1,415,180	1,422,402	1,438,764	1,421,641	1,500,845	1,593,679
Totalassets		4,967,529	5,273,237	5,690,226	6,397,558	6,505,504	6,579,932
Current liabilities	Before distributio n	3,660,743	4,012,969	1,438,764	1,499,357	1,578,435	2,371,162
	After distributio n	3,660,743	4,012,969	1,438,764	1,499,357	1,578,435	2,371,162
Non-currentliabilities		555,668	449,873	1,126,912	3,719,035	3,588,982	2,767,213
Total liabilities	Before distributio n	4,216,411	4,462,842	4,901,281	5,218,392	5,167,417	5,138,375
	After distributio n	4,216,411	4,462,842	4,901,281	5,218,392	5,167,417	5,138,375
Equity attributable to owners of the parent company		1,111,916	1,162,584	1,161,199	1,429,061	1,689,249	1,800,769
Share capital		1,353,430	1,353,430	1,353,430	1,353,430	1,353,430	1,353,430
Capitalsurplus		701	701	701	701	701	701
Retained earnings	Before distributio n	(790,833)	(794,444)	(833,657)	(614,008)	(390,514)	(356,069)
	After distributio n	(790,833)	(794,444)	(833,657)	(614,008)	(390,514)	(356,069)
				649,781	688,938	725,632	802,707
Treasury shares		(9,056)	(9,056)	(9,056)	0	0	0
Non-controllinginterests		(360,798)	(352,189)	(372,254)	(249,895)	(351,122)	(359,212)
Total equity	Before distributio n	751,118	810,395	788,945	1,179,166	1,338,127	1,441,557
	After distributio n	751,118	810,395	788,945	1,179,166	1,338,127	1,441,557

＊ A company that has compiled parent company only financial statements shall also compile parent company only condensed balance sheets and statements of comprehensive income for the most recent 5 fiscal years. ＊ A company that has adopted the International Financial Reporting Standards for its financial information for less than 5 fiscal years shall additionally prepare Table (2) below presenting its financial information under the Enterprise Accounting Standards of the R.O.C.

46 -

(2) Condensed Statement of Comprehensive Income

Unit: NT$ thousands

Fiscal year Item	Fiscal year Item	Financial Information for Most Recent 5 Fiscal Years	Financial Information for Most Recent 5 Fiscal Years	Financial Information for Most Recent 5 Fiscal Years	Financial Information for Most Recent 5 Fiscal Years	Financial Information for Most Recent 5 Fiscal Years	Financial information as of March 31 of the current fiscal year
		2018	2019	2020	2021	2022
OperatingRevenue		1,128,161	703,856	569,401	866,817	847,500	166,277
GrossProfit		(14,001)	184,365	155,378	257,020	346,069	82,779
OperatingIncome		(202,439)	100,823	90,736	182,094	245,829	56,778
Non-operating income and expenses		(387,375)	(91,377)	(138,651)	32,529	(99,364)	(29,024)
Profit beforeincome tax		(589,814)	9,446	(47,915)	214,623	146,465	27,754
Net income for the period fromcontinuing operations		(599,160)	703,856	(46,934)	206,755	143,013	27,754
Loss from discontinued operations		(11,688)	184,365	(11,803)	(2,621)	0	0
Net income (loss) for the period		(610,848)	100,823	(58,737)	204,134	143,013	27,997
Other comprehensive income (loss) for the period (net of IncomeTax)		954,485	(91,377)	40,297	32,312	22,398	75,433
Total comprehensive income for the period		343,637	71,317	(18,440)	236,446	165,411	103,430
Net income attributable to owners of parent		(320,217)	2,194	(38,981)	222,187	225,446	34,443
Net income (loss) attributable to non- controlling interests		(290,631)	659	(19,756)	(18,053)	(82,433)	(6,448)
Total comprehensive income attributable to owners ofparent		204,405	50,668	(1,385)	260,123	260,188	111,520
Total comprehensive income, attributable to non- controllinginterests		139,232	20,649	(17,055)	(23,677)	(94,777)	(8,090)
	Earningsper share	(2.38)	0.02	(0.29)	1.65	1.67	0.25
1.

47 -

(3) Concise Individual Balance Sheet

Unit: NT$ thousands

		Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands
Year Item		Financial analysisfor thePast FiveYears
		2018	2019	2020	2021	2022
Current assets		1,495,388	1,392,128	1,282,210	1,329,508	1,350,452
Property, plant and equipment		2,939,408	3,333,876	3,752,572	4,095,153	4,260,576
Intangible assets		-	-	-	-	-
Otherassets		849,380	860,751	901,434	935,137	1,065,622
Total assets		5,284,176	5,586,755	5,936,216	6,359,798	6,676,650
Current liabilities	Before distribution	2,409,339	2,824,543	2,578,676	298,079	383,034
	Afterdistribution	2,409,339	2,824,543	2,578,676	298,079	383,034
Non-current liabilities		1,762,921	1,599,628	2,196,341	4,632,658	4,604,367
Total liabilities	Before distribution	4,172,260	4,424,171	4,775,017	4,930,737	4,987,401
	Afterdistribution	4,172,260	4,424,171	4,775,017	4,930,737	4,987,401
Capital		1,353,430	1,353,430	1,353,430	1,353,430	1,353,430
Capital reserve		701	701	701	701	701
Retained earnings	Before distribution	(790,833)	(794,444)	(833,657)	(614,008)	(390,514)
	Afterdistribution	(790,833)	(794,444)	(833,657)	(614,008)	(390,514)
Other interests		557,674	611,953	649,7813	688,938	725,632
Treasury stock		(9,056)	(9,056)	(9,056)	0	0
Total equity	Before distribution	1,111,916	1,162,584	1,161,199	1,429,061	1,689,249
	After distribution	1,111,916	1,162,584	1,161,199	1,429,061	1,689,249

A company that has compiled parent company only financial statements shall also compile parent company only condensed balance sheets and statements of comprehensive income for the most recent 5 fiscal years. A company that has adopted the International Financial Reporting Standards for its financial information for less than 5 fiscal years shall additionally prepare Table (2) below presenting its financial information under the Enterprise Accounting Standards of the R.O.C.

(4) Condensed Individual Income Statement

Unit: NT$ thousands

	Unit: NT$ thousands	Unit: NT$ thousands	Unit: NT$ thousands	Unit: NT$ thousands	Unit: NT$ thousands
Year Item	FinancialanalysisforthePastFiveYears
	2018	2019	2020	2021	2022
Operatingrevenue	556,059	442,850	435,223	532,014	579,959
Operatingmargin	77,135	103,238	142,071	189,055	266,191
Operatingincome	43,711	62,993	103,347	148,594	224,830
Non-operating income and expenses	(351,584)	(56,450)	(131,037)	76,212	616
Netprofit after tax	(307,873)	6,543	(27,690)	224,806	225,446
Loss of suspended business unit	(11,688)	(4,494)	(11,803)	(2,621)	0
Netincome (loss)	(320,217)	2,194	(38,981)	222,187	225,446
Other comprehensive income,net oftax	524,622	48,474	37,596	37,936	34,742
Total comprehensive income	204,405	50,668	(1,385)	260,123	260,188
Earningsper share	(2.38)	0.02	(0.29)	1.65	1.67

48 -

(3) Auditors’ Opinions from 2018 to 2023

		Year
2018	2019	2020	2021	2022
CHIU CHI SHENG	CHIU CHI SHENG	CHEN KUEI MEI	CHEN KUEI MEI	CHEN KUEI MEI
CHEN KUEI MEI	CHEN KUEI MEI	CHIU CHI SHENG	WANG WU CHANG	WANG WU CHANG
Unqualified opinion	Unqualified opinion	Unqualified opinion	Unqualified opinion	Unqualified opinion

2. Five-Year Financial Analysis

(1) Financial Analysis-Based on IFRS

Item	Fiscal year	Financial Information fortheMostRecent 5Years	Financial Information fortheMostRecent 5Years	Financial Information fortheMostRecent 5Years	Financial Information fortheMostRecent 5Years	Financial Information fortheMostRecent 5Years	As of March 31 of the current fiscal year
		2018	2019	2020	2021	2022
Financi al structur e (%)	Debt to assetsratio	84.88	84.63	86.14	81.57	79.43	78.09
	Ratio of long-term capital toproperty, plant and equipment	23.52	20.23	35.24	86.24	84.05	84.66
Solven cy (%)	Currentratio	20.36	16.35	17.54	48.77	37.71	23.54
	Quick ratio	15.18	12.63	15.21	44.64	33.96	21.02
	Timesinterest earned	-	105.13	26.51	336.46	255.17	175.98
Operati ng perfor mance	Accountsreceivable turnover(times)	7.72	4.49	3.33	4.15	4.20	1.02
	Average collectiondays	47.27	81.29	109.60	87.95	86.90	88.23
	Inventory turnover(times)	4018	3.25	3.72	8.73	8.64	1.53
	Accounts payable turnover(times)	3.06	3.11	4.25	4.81	4.40	1.00
	Average daysinsales	87.32	112.30	98.11	41.80	42.24	58.82
	Property, plant and equipment (times)	0.29	0.16	0.12	0.16	0.15	0.03
	Totalasset turnover(times)	0.22	0.13	0.10	0.13	0.13	0.02
Profitab ility	Returnontotalassets (%)	(11.38)	1.93	0.41	4.86	3.64	0.98
	Return on equity (%)	(107.89)	0.36	(7.34)	20.74	11.36	2.01
	Ratio of income before tax to paid-in capital (%)	(44.44)	0.36	(4.41)	15.66	10.82	2.05
	Net profitmargin(%)	(54.14)	0.40	(10.31)	23.54	16.87	16.84
	Earnings pershare (NT$)	(2.38)	0.02	(0.29)	1.65	1.67	0.25
Cash flow	Cash flowratio (%)	-	-	5.30	16.54	20.61	3.15
	Cash flow adequacyratio (%)	-	-	-	-	17.33	39.16
	Cash reinvestmentratio (%)	-	-	10.23	5.06	6.61	1.77
Levera ge	Operating leverage	(0.31)	4.31	4.69	3.63	2.71	1.38
	Financial leverage	-	-23.21	9.57	1.96	1.62	2.80

49 -

(2) Consolidated Financial Analysis – Based on IFRSs

Item	Year	Financial AnalysisforthePastFiveYears	Financial AnalysisforthePastFiveYears	Financial AnalysisforthePastFiveYears	Financial AnalysisforthePastFiveYears	Financial AnalysisforthePastFiveYears
		2018	2019	2020	2021	2022
Financial structure (%)	DebtRatio	78.96	79.19	80.44	77.53	74.70
	Ratio of long-term capitalto fixed assets	42.76	34.87	46.13	109.99	107.71
Solvency (%)	Currentratio	62.07	62.07	49.72	446.03	352.57
	Quick ratio	57.76	47.38	48.79	442.99	350.56
	Interest earned ratio (times)	-	1.05	-	6.94	5.83
Operating performance	Accounts receivable turnover(times)	7.87	5.98	6.72	7.81	8.75
	Average collection period	46.38	61.04	54.32	46.73	41.01
	Inventory turnover (times)	3.68	4.82	9.27	26.95	46.54
	Accounts payable turnover(times)	5.76	6.54	7.20	10.22	11.28
	Average daysinsales	99.18	75.73	39.37	13.54	7.84
	Property, plant and equipmentturnover (times)	0.19	0.13	0.12	0.13	0.14
	Total assets turnover (times)	0.11	0.08	0.07	0.08	0.09
Profitability	Return on total assets (%)	(5.70)	0.74	(0.10)	4.22	4.17
	Return on stockholders’ equity (%)	(32.41)	0.19	(3.35)	17.16	16.66
	Pre-tax income to paid-incapital(%)	(23.61)	0.15	(2.92)	16.42	16.66
	Profitratio (%)	(57.59)	0.50	(8.96)	41.76	39.01
	Earnings per share (NT$)	(2.38)	0.02	(0.29)	1.65	1.67
Cash flow	Cash flowratio (%)	-	5.89	4.44	70.62	83.25
	Cash flow adequacy ratio (%)	-	-	17.23	27.56	49.87
	Cash reinvestment ratio (%)	-	4.46	3.41	3.47	5.07
Leverage	Operatingleverage	2.89	2.55	2.08	1.88	1.73
	Financial leverage	-3.53	2.54	1.47	1.33	1.26
Analysis of financial ratio differences for the last two years. (Not required if the difference does not exceed 20%) 1. Current ratio, quick ratio: mainly due to the decrease in bank deposits. 2. Inventory turnover rate (times), days sales outstanding: mainly due to the decrease in cost of sales. 3. Cash flow adequacy ratio (%): mainly due to the increase in cash inflow from operations. 4. Cash reinvestment ratio(%): mainlydue to the increase in net cash inflow from operatingactivities.

50 -

Audit Committee’s Report for the Annual Report for the Most Recent Year

Lily Logistics Development Co., Ltd. Audit Committee’s Review Report

The Board of Directors has prepared and submitted to the undersigned, Audit Committee of Lily Logistics Development Co., Ltd. 2022 Business Report and Profits and Deficit Compensation. The Consolidated Financial Statements and Parent Company Only Financial Reports have been duty audited by Certified Public Accountants CHEN KUEI MEI and WANG WU CHANG of Crown (TW) CPAs. The above Business Report, Profits and Deficit Compensation, Consolidated Financial Statements, Parent Company Only Financial Reports have been examined and determined to be correct and accurate by the undersigned. This Report is duly submitted in accordance with Securities and Exchange Law and the Company Law.

Lily Logistics Development Co., Ltd. The Audit Committee, Chairman: CHIEN HUA YUEH

Member: SU TING Member: LIEN SAN HO

March 20, 2023

51 -

6.4 Financial Statements for the Most Recent Fiscal Year

Lily Logistics Development Co., Ltd. and its Subsidiaries

Affidavit

December 31, 2022

In 2022 (from January 1, 2022 to December 31, 2022), the companies that should be included in the consolidated financial reports of affiliated companies based on "Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises" and the companies that should be included in the consolidated financial reports of subsidiaries based on the International Financial Reporting Standards 10. The related information that should be disclosed in the consolidated financial statements of affiliated companies are also already disclosed in the consolidated financial reports for subsidiaries, so that the consolidated financial statements of affiliated companies would not be published separately.

Very truly yours,

Company Name: Lily Logistics Development Co., Ltd.

Person in-charge: Su, Tung-Rong

March 13, 2023

- 52 -

Independent Auditor’s Report

To: Lily Logistics Development Co., Ltd.

Opinion

Lily Logistics Development Co., Ltd. and its subsidiaries’ balance sheet for December 31 of 2022 and 2021, the comprehensive income statement, the parent company only statement of changes of equity, and the cash flow statement from January 1 to December 31 of 2022 and 2021 and the notes to the financial statements (including the summary of major accounting policies) have been audited by the Auditor of the Firm.

According to the opinions of the Auditor, the above-mentioned financial statements are prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers in all material aspects, which are sufficient to express the financial status of Lily Logistics Development Co., Ltd. and its subsidiaries on December 31, 2022 and 2021, and parent company only financial performance and parent company only cash flow from January 1 to December 31 in 2022 and 2021.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Lily Logistics Development Co., Ltd. (the Company) and its subsidiaries in accordance with the Professional Ethics for Certified Public Accountants of the Republic of China and we have fulfilled our other ethical responsibilities in accordance with these requirements. The Auditor believes that sufficient and appropriate audit evidence has been obtained as a basis for expressing audit opinion.

Key Audit Matters

Key audit issues are those that, in our professional judgment, were of utmost significance in our audit of the consolidated financial statements of the Company and its subsidiaries for the year 2022. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

The key audit items of Lily Logistics Development Co., Ltd. and its subsidiaries' financial statements in 2022 are as follows:

Impairment of accounts receivable

Please refer to Notes (4)7, (6)5 and (7) of the financial statement for relevant disclosures on impairment of receivables.

For Lily Logistics Development Co., Ltd. and its subsidiaries’ receivables (including related parties) on December 31, 2022, the impairment was recognized by the management level via various external evidence evaluations. Since it involves the judgment of the management level, it is listed as the key items to be verified by the Auditor when reviewing the financial statement.

The major audit procedures performed by the Auditor in response to the above key audit matters include:

Obtain the aging analysis table of accounts receivable, calculate the aging interval, and audit the original documents to verify that the accounts receivable have been listed in the appropriate period in the aging analysis table; and select the sample and send the letter for confirmation.
Review historical collection records, industrial economic conditions, and customer credit risk information, and test the collection situation after the period to evaluate the rationality of the Company’s allowance for impairment and impairment loss of receivables.
Obtain the evaluation document for the impairment of accounts receivable, confirm whether it

- 53 -

complies with the Company's accounting policies, and review whether the management level's disclosure of the allowance for accounts receivable is appropriate.

Miscellaneous

Lily Logistics Development Co., Ltd. has prepared the parent company only financial reports for the 2022 and 2021, and the audit report issued by the Auditor with unqualified opinions has been issued for reference.

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

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

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

The governing unit of Lily Logistics Development Co., Ltd. and its subsidiaries are responsible for supervising the financial reporting process.

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

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

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

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

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continue as a going concern.

Evaluate the overall presentation, structure and content of the consolidated financial statements, including the accompanying notes, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group of the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

The planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements for the year 2022, and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Crowe Global Accountants:

Accountants:

License Number: Jin Guan Zheng Shen Zi No. 10200032833

March 13, 2023

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Lily Logistics Development Co., Ltd. and its Subsidiaries

Consolidated Balance Sheet

December 31, 2022 and 2021

Unit: NT$1,000

December 31,	December 31,	2021
Amount $ 595,350 132,941 4,763 5,824 7,335 24,202 134,242 3,624 27,602 5,897 762 51,396 4,918 5,300 186,544 5,910,194 153,246 386,802 4,409,349 7,917 906,251 2,980 43,649 $ 6,505,544	Amount $ 731,367 171,216 6,217 6,003 26,324 12,546 192,475 2,781 38,964 15,459 841 54,785 4,918 17,841 180,997 5,666,191 125,536 338,791 4,244,550 1,173 926,061 3,250 26,830 $ 6,397,558	%
		11
		3 - - - - 3 - 1 - - 1 - - 3
		89
		2 5 66 - 15 - 1
		100

(Continued to next page)

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(Contd.)

December 31,	December 31,	2021
Amount $1,578,435 531,400 1,818 15,657 213 67,621 2,198 239,077 563,961 3,134 3,018 3,124 146,723 491 3,588,982 3,129,710 370,231 4,819 17,256 66,966 5,167,417 1,689,249 1,353,430 701 (390,514) (390,514) 725,632 83,624 138,376 503,632 - (351,122) 1,338,127 $6,505,544	Amount $1,499,357 448,060 3,206 15,442 100 124,401 2,158 211,683 513,025 8,113 2,736 1,197 168,819 417 3,719,035 3,280,289 370,231 - 16,708 51,807 5,218,392 1,429,061 1,353,430 701 (614,008) (614,008) 688,938 98,839 86,467 503,632 - (249,895) 1,179,166 $6,397,558	%
		24
		7 - - - 2 - 4 8 - - - 3 -
		58
		51 6 - - 1
		82

		22
		21
		-
		(10)
		(10)
		11
		2 1 8
		-
		(4)
		18
		100

(The notes attached to the financial statements constitute a part of this parent company only financial statements)

Managerial officers:

Chairman:

Head-Finance & Accounting:

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Lily Logistics Development Co., Ltd. and its Subsidiaries Consolidated Statement of Comprehensive Income January 1 to December 31, 2022 and 2021

Unit: NT$1,000

Code Items 2022 2021 Amount % Amount ％ 4000 Net operating revenue (Note (6)26) $ 847,500 100 $ 866,817 100 5000 Operating costs ( 501,431) ( 59) ( 609,797) ( 70) 5900 Gross profit 346,069 41 257,020 30 6000 Operating expenses ( 100,240) ( 12) ( 74,926) ( 9) 6100 Sales and marketing expenses ( 18,120) ( 2) ( 17,082) ( 2) 6200 General and administrative expenses ( 69,563) ( 8) ( 57,762) ( 7) 6450 Expected loss on credit impairment (Note (6)5) ( 12,557) ( 2) ( 82) - 6900 Operating income 245,829 29 182,094 21 7000 Non-operating income and expenses ( 99,364) ( 12) 32,529 4 7100 Interest income 5,065 - 4,583 - 7010 Operating revenue (Note (6)28) 5,212 1 5,436 1 7020 Other gains and losses (Note (6)29) ( 25,950) ( 3) ( 35,808) ( 4) 7050 Finance costs (Note (6)30) ( 94,387) ( 11) ( 89,656) ( 10) 7070 Profit and loss of subsidiaries, associates and joint ventures recognized by using equity method (Note (6)11) 10,696 1 147,974 17 7900 Income before income tax 146,465 17 214,623 25 7950 Income tax expense (Note (6)31) ( 3,452) - ( 7,868) ( 1) 8000 Profit of (loss) for the period from continuing operations 143,013 17 206,755 24 8100 Loss from discontinued operations, net of tax (Note (6)9) - - ( 2,621) - 8200 Net income 143,013 17 204,134 24 Other comprehensive income (loss) of the current period (Note (6)32) 8310 Not to be reclassified to profit or loss in subsequent periods 8311 Remeasurements of defined benefit plans (Note (6)19) ( 1,952) - ( 1,221) - 8316 Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income 14,583 2 1,976 - 8326 Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income (Note (6)11) 37,326 4 44,113 5 8360 To be reclassified to profit or loss in subsequent periods 8361 Exchange differences on translation of foreign operations ( 27,559) ( 3) ( 12,556) ( 2) 8300 Net of other comprehensive income of the current period 22,398 3 32,312 3 8500 Total comprehensive income $ 165,411 20 $ 236,446 27 8600 Net profit (loss) attributable to: 8610 Shareholders of the parent company $ 225,446 $ 222,187 8620 Non-controlling interests ( 82,433) ( 18,053) $ 143,013 $ 204,134 8700 Comprehensive income attributable to: 8710 Shareholders of the parent company $ 260,188 $ 260,123 8720 Non-controlling interests ( 94,777) ( 23,677) $ 165,411 $ 236,446 Basic earnings per share (NT$) (Note (6)33) 9710 Profit of (loss) from continuing operations $ 1.67 $ 1.67 9720 Net profit or loss from discontinued operation - ( 0.02) 9750 Basic earnings per share (NT$) $1.67 $1.65 (The notes attached to the financial statements constitute a part of this parent company only financial statements) Chairman: Managerial officers: Head-Finance & Accounting:	2021
		％
		100 ( 70)
		30 ( 9)
		( 2) ( 7) -
		21 4
		- 1 ( 4) ( 10) 17
		25 ( 1)
		24 -
		24
		- - 5 ( 2)
		3
		27

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Lily Logistics Development Co., Ltd. and its Subsidiaries

Consolidated Statement of Changes in Equity

January 1 to December 31, 2022 and 2021

Unit: NT$1,000

Equity attributable to the parent

				Equity attributable to the parent	Equity attributable to the parent	Equity attributable to the parent				Unit: NT$1,000
Items	Common stock	Capital surplus	Retained earnings	Other Components of Equity			Treasury stock	Total equity attributable to the parent	Non-controlling interests	Total Equity
			Unappropriated earnings (accumulated deficit)	Exchange differences on translation of foreign operations	Unrealized gain or loss on financial assets measured at fair value through other comprehensive income	Real estate revaluation appreciation
	$ 1,353,430 - - -	$ 701 - - -	($ 833,657) 222,187 ( 1,221) ( 1,317)	$ 105,771 - ( 6,932) -	$ 40,378 - 46,089 -	$ 503,632 - - -	($ 9,056) - - 9,056	$ 1,161,199 222,187 37,936 7,739	($ 372,254) ( 18,053) ( 5,624) 146,036	$ 788,945 204,134 32,312 153,775
	1,353,430 - - -	701 - - -	( 614,008) 225,446 ( 1,952) -	98,839 - ( 15,215) -	86,467 - 51,909 -	503,632 - - -	- - - -	1,429,061 225,446 34,742 -	( 249,895) ( 82,433) ( 12,344) ( 6,450)	1,179,166 143,013 22,398 ( 6,450)

Chairman:

(The notes attached to the financial statements constitute a part of this parent company only financial statements) Managerial officers: Head-Finance & Accounting:

Head-Finance & Accounting:

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Lily Logistics Development Co., Ltd. and its Subsidiaries

Consolidated Statement of Cash Flows January 1 to December 31, 2022 and 2021

Items Cash flows from operating activities: Net profit before tax from continuing operations Net profit before tax from discontinuing operations Income before income tax Net income before tax Adjustments to reconcile profit (loss) not affected Depreciation Amortization expenses Expected loss on credit impairment Financial asset loss measured at fair value through profit or loss Interest expense Interest income Dividend income Share of the profit of associates and joint ventures accounted for using the equity method Loss on disposal of property, plant and equipment (gain) Loss of investments disposed of Loss of investment real estate adjusted by fair value Changes in current assets and liabilities related to operating activities Decrease of notes receivable Notes receivable - Increase of related parties Decrease (increase) of accounts receivable Accounts receivable-Decrease (increase) of related parties Decrease of other receivables Other accounts receivable - Decrease of related parties Decrease of inventory Decrease of prepayments Decrease of other current assets Other financial assets - (Increase) decrease of current Decrease of contract liabilities Increase (decrease) of notes payable Notes payable-Increase (decrease) of related parties Increase (decrease) of accounts payable Accounts payable - Increase of related parties Increase of other payables Allowance for liabilities - Increase in flow Increase (decrease) of other current liabilities Decrease of confirmed benefit debt Cash flow generated from operating activities Interest received Dividends received Interest paid Income tax (paid) returned Inflow of net cash used in operating activities	2022 $ 146,465 - 146,465 88,488 9,458 12,557 114 94,387 ( 5,065) ( 1,534) ( 10,696) - 1,228 38,054 18,989 ( 11,656) 43,627 969 11,699 9,562 3,389 14,183 - ( 5,547) ( 1,388) 215 113 ( 56,780) 40 16,214 282 74 ( 1,404) 416,037 4,611 1,534 ( 88,657) ( 8,082) 325,443	Unit: NT$1,000 2021
		$ 214,623 ( 2,621)
		212,002 68,962 7,234 82 1,839 89,656 ( 4,583) ( 1,697) ( 147,974) ( 1,205) 2,034 46,272 3,928 ( 1,589) ( 52,062) ( 2,349) 4,680 1,291 20,207 4,896 78 582 ( 995) ( 4,667) ( 819) 36,124 20 53,593 322 ( 141) ( 770)
		334,951
		4,789 1,697 ( 93,907) 563
		248,093

(Continued to next page)

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(Contd.)

Items Cash flows from investing activities: Acquisition of financial assets measured at fair value through other comprehensive income Acquired financial asset measured at fair value through profit or loss Financial asset disposed of measured at fair value through profit or loss Disposal of investments accounted for under the equity method Disposal of subsidiary Acquisition of property, plant and equipment Decrease (increase) in refundable deposits Acquisition of investment property Decrease of collections Increase of other non-current assets Increase of prepaid of equipment Net cash used in investing activities Cash flows from financing activities: Increase (decrease) of short-term loans Increase in long-term loans Decrease in long-term loans Decrease of guarantee deposits Other payables - Increase of related parties Repayment of principal of lease liabilities Changes in non-controlling interests Net cash generated by (used in) financing activities Effect of exchange rate changes on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year	2022 ($ 12,948) ( 2,354) 2,467 10 - ( 240,826) ( 600) ( 1,508) - ( 5,704) (25,921) (287,384) 83,340 - ( 172,675) 15,159 50,936 ( 2,696) (6,450) (32,386) (43,948) ( 38,275) 171,216 $ 132,941	2021
		($ 4,037) ( 18,872) 25,059 837 ( 8,093) ( 282,913) 2,490 ( 2,210) 600 ( 1,704) (93,006)
		(381,849)
		( 2,410,921) 2,584,321 - 25,371 36,946 ( 3,165) -
		232,552
		(21,184)
		77,612 93,604
		$ 171,216

(The notes attached to the financial statements constitute a part of this parent company only financial statements)

Managerial officers:

Head-Finance & Accounting:

Chairman:

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Lily Logistics Development Co., Ltd. and its Subsidiaries

Notes to Consolidated Financial Statements

January 1 to December 31, 2022 and 2021

(Expressed in NT$1,000 unless Otherwise Stated)

(I) Company History

Lily Logistics Development Co., Ltd. (hereinafter referred to as the Company) was founded on November 25, 1972 and originally named as Lili Textile Co., Ltd. which was changed its present name in July 2022. The business originally operated by the Company included spinning, weaving, processing, trading, bidding and agency business of natural cotton, man-made fibers and various chemical fibers, In response to industrial transformation and economic development trends, the Company determined to discontinue the production business of the cotton spinning factory in March 2017. The factory was rebuilt and developed into a logistics center. The current major business of the Company includes warehouse leasing and tallying, and the trading, bidding and agency business of various products of raw cotton materials are retained as supplementary business. Please refer to Note (4)3(2) for the major operating activities of the Company and its subsidiaries (hereinafter referred to as the "Group"). In addition, the Company has no ultimate parent company.

The consolidated financial statements are presented in New Taiwan dollars, which is the Company's functional currency.

(II) Date and Procedures of Authorization of Financial Statements for Issue

The financial statements are released after approval by the board of directors on March 13, 2023.

(III) Newly Issued or Revised Standards and Interpretations
The impact of adopting the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations (hereinafter referred to as "IFRSs") as endorsed by the FSC:

The following table summarizes the newly released, corrected and amended standards and interpretations of the applicable International Financial Reporting Standards recognized by the FSC for 2022:

the FSC for 2022:
Newly-released / corrected / amended standards and	Effective date of publication by
interpretations	the IASB (Note 1)
Amendments to IAS 16 "Property, Plant and Equipment:	January 1, 2022 (Note 2)
Prices before Reaching the State of Intended Use"
Amendment to IAS 37 “Onerous Contracts - Cost of Fulfilling a Contract”	January 1, 2022 (Note 3)
Amendment to IFRS 3 “Reference to Conceptual Framework”	January 1, 2022 (Note 4)
Annual improvements to IFRS 2018-2020	January 1, 2022 (Note 5)
Note 1: Unless otherwise specified, the above-mentioned	newly issued/corrected/amended
standards or interpretations are effective for the annual reporting period starting after
the respective dates.

Note 2: Enterprises shall apply these amendments retrospectively, however, it is only applicable to the property, plant and equipment items that have reached the necessary location and state to meet the management level's expected operation mode after the starting date (January 1, 2021) of the earliest period expressed in the financial statements to which the amendments are applied for the first time.
Note 3: This amendment applies to contracts that have not fulfilled all obligations on January 1, 2022.
Note 4: This amendment applies to business combinations whose acquisition date begins after January 1, 2022 during the annual reporting period.

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Note 5: The amendments to IFRS 9 apply to the exchange or modification of financial liabilities for annual reporting periods beginning after 1 January 2022; the amendments to IAS 41 apply to fair value measurement for annual reporting periods commencing after January 1, 2022; and the amendments to IFRS 1 apply retrospectively to annual reporting periods beginning after 1 January 2022.
(1) Amended “Property, Plant and Equipment: Proceeds before Intended Use” of IAS 16 The amendment provides that The sale price of items brought about to bring property, plant and equipment to the location and condition necessary to operate in the manner intended by management shall not be recognized as a reduction in the cost of the asset. The above-mentioned output items shall be measured according to IAS 2 "inventory", and the sales price and cost shall be recognized in profit or loss according to the applicable standards. In addition, the amendment also clarifies that the cost of testing whether an asset is in normal operation refers to the expenditure for evaluating whether the technical and physical performance of the asset is sufficient to enable it to be used for production or provision of products or services, leased to others, or management purposes.

This amendment applies to plant, property and equipment in the necessary location and condition to reach the necessary location and condition of the management's intended mode of operation after January 1, 2021 (the earliest date for the beginning of the period of expression). When the Group applies the amendment for the first time, the cumulative impact of initial application of the amendments will be recognized as an adjustment to the beginning balance of retained earnings (or other components of equity, as appropriate) at the beginning of the earliest presentation period and the information for the comparative periods will be restated.

(2) Amendment to IAS 37 “Onerous Contracts - Cost of Fulfilling a Contract”
The amendment clarifies that, when assessing whether a contract is onerous, "costs of fulfilling a contract" shall include the incremental costs of fulfilling a contract (for example, direct labor and materials) and the allocation of other costs directly related to fulfilling a contract (for example, Allocation of depreciation expenses for items of property, plant and equipment used under the contract).
(3) Amendment to IFRS 3 “Reference to Conceptual Framework”

The amendment is to update the reference to the conceptual framework and add the requirement that the acquirer should apply IFRIC 21 "Common Levies" to determine whether there is an obligation to pay the common levies on the date of acquisition.

(4) Annual improvements to IFRS 2018-2020

The annual improvement of IFRS 2018-2020 includes the revision of certain standards, among which the revision of IFRS 9 is to assess whether there is a significant difference in the exchange or modification of financial liabilities, and compare the discounted cash flow value of the new and old contract terms (including the signing of new contracts or modification If there is a 10% discrepancy between the net amount of fees charged and paid under the contract), the aforementioned fees collected and paid shall only include the fees received and paid between the borrower and the lender. The Group has evaluated that the above standards and interpretations have no significant impact on the Group's financial status and financial performance.

The impact of the newly released and revised International Financial Reporting Standards approved by the FSC:

The following table summarizes the newly released, corrected and amended standards and interpretations of the applicable International Financial Reporting Standards recognized by the FSC for 2023:

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Newly-released / corrected / amended standards and[Effective date of publication by ] interpretations the IASB Amendments to IAS 1 "Disclosure of Accounting January 1, 2023 (Note 1) Policies" Amendments to IAS 8 "Definition of Accounting January 1, 2023 (Note 2) Estimates" Amendments to IAS 12 "Deferred Income Tax January 1, 2023 (Note 3) related to Assets and Liabilities arising from Single Transaction"

Note 1: This amendment applies to the annual reporting period beginning after January 1, 2023.
Note 2: This amendment applies to changes in accounting estimates and changes in accounting policies that occur during the annual reporting period beginning after January 1, 2023.
Note 3: Unless there are additional provisions for temporary differences related to leasing and decommissioning obligations, this amendment applies to transactions occurring after the start date of the earliest comparative period expressed (January 1, 2022).
(1) Amendments to IAS 1 "Disclosure of Accounting Policies"
This amendment clarifies that when a transaction, other event or situation is significant in scale or nature, and its related accounting policy information is also significant to the financial report, such relevant significant accounting policy information should be disclosed. Conversely, if an enterprise determines that the scale or nature of a transaction, other event, or situation is not material, or that the accounting policy information related to it is not material, it is not necessary to disclose such insignificant accounting policy information. However, the conclusion made by the enterprise that the accounting policy information is not significant will not affect the relevant disclosures required by other IFRS standards.
(2) Amendments to IAS 8 "Definition of Accounting Estimates"
This amendment defines accounting estimates as monetary amounts in financial statements that are affected by measurement uncertainty, and provides further clarification that, except for corrections caused by prior-period errors, the effects of changes in input values or measurement techniques on accounting estimates are accounting Estimated changes.
(3) Amendments to IAS 12 "Deferred Tax related to Assets and Liabilities arising from a Single Transaction"
The amendments narrow the scope of the exemption from recognition of deferred tax liabilities and assets in paragraphs 15 and 24 of IAS 12. If the taxable temporary difference arising from a single transaction at the time of original recognition is the same as the deductible temporary difference, the above exemption does not apply. When the enterprise applies this amendment for the first time, it shall recognize deferred income tax on all temporary differences related to lease and decommissioning obligations on the starting date of the earliest comparative period expressed (January 1, 2022), and the cumulative effect is recognized at that date as an adjustment to the initial balance of retained earnings (or other component of equity, as appropriate). For other transactions that occurred after January 1, 2022, the application of this amendment shall be deferred. When the Group applies this amendment for the first time, it shall restate the comparative period information.

The Group has evaluated that the above standards and interpretations have no significant impact on the Group's financial status and financial performance.

The impact of the International Financial Reporting Standards issued by the International Accounting Standards Board but not yet approved by the FSC:
The following table summarizes the newly issued, revised and revised standards and interpretations that have been issued by the International Accounting Standards Board but have not yet been incorporated into the International Financial Reporting Standards approved by the FSC:

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Newly-released / corrected / amended standards and Effective date of publication interpretations by the IASB Amendments to IFRS 10 and IAS 28 "Asset Sale between To be determined the Investor and its Affiliates or Joint Ventures" IFRS 17 "Contracts of Insurance" January 1, 2023 Amendments to IFRS 17 January 1, 2023 Amendments to IFRS 17 "Initial Application of IFRS 17 January 1, 2023 and IFRS 9 - Comparative Information" Amendments to IFRS16 "Lease Liability in After January 1, 2024 Sale-leaseback" Amendments to IAS 1 "Classification of Liabilities as January 1, 2024 Current or Non-Current" Amendments to IAS 1 "Non-Current Liabilities with January 1, 2024 Contractual Terms"

As of the issuance date of the financial statements, the Group is still continuously evaluating the impact of the above-mentioned standards and interpretations on the Group's financial status and performance, and the relevant impact will be disclosed when the evaluation is completed.

(IV) Summary of Significant Accounting Policies

The major accounting policies adopted in the preparation of the financial statements are described below. Unless otherwise stated, these policies apply consistently throughout all reporting periods.

Compliance statement

The consolidated financial report has been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards (IFRSs), International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC.

Compilation basis
(1) The financial report have been prepared on a historical costs except for the following key items:
- A. Financial assets and liabilities (including derivatives) at fair value through profit or loss.
- B. Financial assets and liabilities at fair value through other comprehensive income.
- C. Liabilities for cash-settled share-based payment agreements measured at fair value.
- D. Defined benefit liabilities recognized as the net amount of pension fund assets minus the present value of defined benefit obligations.
(2) The preparation of financial reports that comply with the IFRSs recognized by the Financial Supervisory Commission requires the use of certain key accounting estimates. In the process of applying the Group's accounting policies, the management level also needs to make judgments, requires items involving high-level judgments or complexity, or items involving major assumptions and estimates of consolidated financial statements. Please refer to Note (5) for description.
Consolidation basis
(1) Basis for preparation of consolidated financial statements
- A. The Group incorporates all subsidiaries into entities for the preparation of financial statements. The subsidiary refers to an entity (including a structured entity) controlled by the Group, when the firm is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity, it shall be regarded that the Group is controlling the entity. Subsidiaries are included in the consolidated financial report from the date when the Group obtains control, and are terminated from the date when control is lost.

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B. Intra-group transactions, balances and unrealized gains and losses are eliminated. The accounting policies of the subsidiaries have been adjusted as necessary to be consistent with the policies adopted by the Group.
C. Profit and loss and other components of comprehensive profit and loss are attributable to the owners and non-controlling interests of the parent company; the total comprehensive profit and loss is also attributable to the owners and non-controlling interests of the parent company, even if the non-controlling interests suffer losses due to this.
D. If the change in the shareholding of the subsidiary does not result in a loss of control (transactions with non-controlling interests), it will be regarded as an equity transaction, which is being regarded as the transaction with the owner. Any difference between the adjusted amount of non-controlling interests and the fair value of the consideration paid or received is directly recognized in equity.
E. When the Group loses control over the subsidiary, the remaining investment in the former subsidiary is remeasured at fair value and adopted as the fair value of the originally recognized financial assets or the cost of the originally recognized investment in affiliated enterprises or joint ventures. The difference between the fair value and the carrying amount is recognized as profit or loss of the current period. For all amounts previously recognized in other comprehensive profit or loss related to the subsidiary, the accounting treatment is the same as if the Group directly disposes of the relevant assets or liabilities, that is, if the benefit or loss previously recognized as other comprehensive profit or loss will be reclassified as profit or loss when disposing of the relevant assets or liabilities, when control of the subsidiary is lost, the benefit or loss will be reclassified from equity to profit or loss.
(2) Subsidiaries included in the financial statements are as follows:

Shareholding or contribution ratio Name of the investors Name of subsidiaries Main business and products 2022.12.31 2021.12.31 To: Lily Logistics GIANTEX TEXTILE 1. Spinning and weaving of A A Development Co., Ltd. (the CORPORATION various fibers such as Company) (GIANTEX) natural fibers, man-made fibers, and chemical fibers. 2. Printing, bleaching, dyeing and finishing of various fiber products.

General import and export trade (except futures) (except licensing business).
Entrust construction companies to develop industrial zones approved by industrial competent authorities.
Entrust construction companies to build commercial buildings and public housing for lease and sales businesses.
Design, manufacture and sales of computer system hardware and related software.
Import and export of computers and related electronic components.
Sales agency and reinvestment of the above-mentioned related

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businesses.

LILYTEX Various food and beverages, B B INTERNATIONAL CORP. cosmetics, medicines, " (LILYTEX batteries, toys, information INTERNATIONAL) software, electrical appliances and business machines

Name of the investors	Name of subsidiaries	Main business and products	Shareholding or contribution ratio	Shareholding or contribution ratio
			2022.12.31	2021.12.31
" " " GIANTEX TEXTILE CORPORATION (GIANTEX) LILYTEX INTERNATIONAL CORP.(LILYTEX)	MIGHTY BUSINESS LTD.(MIGHTY) GISONG ENTERPRISE CORPORATION (GISONG ) LILYTEX INTERNATIONAL CORP. (LILYTEX) STAR PACIFIC SERVICES CORP. (STAR PACIFIC) Kunshan Lily Textile Co., Ltd. (Kunshan Lily)	Based on the instructions of the parent company's operating policies to reinvest in various businesses outside Taiwan. Spinning of yarn Based on the instructions of the parent company's operating policies to reinvest in various businesses outside Taiwan. Based on the instructions of the parent company's operating policies to reinvest in various businesses outside Taiwan. Warehousing and leasing	100.00% 57.00% 70.59% A 78.21%	100.00% 57.00% 70.59% A 78.21%

Increase and decrease of consolidated subsidiaries:

A. On November 30, 2021, the Group sold 2,800 thousand shares of its subsidiary GIANTEX TEXTILE CORPORATION, as a result, the Group's shareholding in GIANTEX dropped to 46.27%. Since then, the Group lost control over GIANTEX and ceased to be list it as a consolidated subsidiary. For GIANTEX's wholly-owned subsidiary - STAR PACIFIC, the Group lost control over STAR PACIFIC at the same time from that day onwards, and ceased to be list it as a consolidated subsidiary.
B. It is determined that the subsidiary LILYTEX INTERNATIONAL CORP. will be dissolved on October 1, 2021. The Group lost its significant influence on the subsidiary from that day on and ceased to list it as a consolidated subsidiary. LILYTEX INTERNATIONAL CORP. was liquidated on June 13, 2022.

(3) Subsidiaries not included in the financial statements: None.

(4) Adjustments and treatment methods for different accounting periods of subsidiaries: None.

(5) Significant restrictions:

On December 31, 2022 and 2021, the Group's cash and cash in bank were NT$25,222 thousand and NT$25,072 thousand, respectively in China, which were subject to local foreign exchange control. These foreign exchange controls restrict the repatriation of funds outside of China (except through normal dividends).

(6) Subsidiaries holding securities issued by the parent company: None.
(7) Information on subsidiaries with significant non-controlling interests:

December 31, 2022 Percentage Non-controlling Profit or loss Name of subsidiaries of interests allocated to

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LILYTEX and its subsidiaries Others Total Name of subsidiaries LILYTEX and its subsidiaries Others Total	ownership 29.41% Percentage of ownership 29.41%	($ 457,211) 106,089 ($ 351,122) Non-controlling interests ($ 358,324) 108,429 ($249,895)	non-controlling interests
			($ 86,544) 4,111
			($ 82,433)
			December 31, 2021
			Profit or loss allocated to non-controlling interests
			($ 32,947) 14,894
			($18,053)

A. Please refer to the Tables 6 and 7 of Note (13) for the country information on the major business locations and company registrations of the above-mentioned subsidiaries.
B. The aggregated financial information is as follows:
(A) Balance Sheets:

LILYTEX INTERNATIONAL CORP. and its subsidiaries

Current assets Non-current assets Current liabilities Non-current liabilities Equity	December 31, 2022 $ 94,820 906,600 ( 2,428,783) ( 238,622) ($1,665,985)	December 31, 2021
		$ 108,515 926,469 ( 2,266,156) ( 214,039)
		($1,445,211)

(B) Statement of Comprehensive Income:

LILYTEX INTERNATIONAL CORP. and its subsidiaries

Revenue Profit (loss) for the year Other comprehensive income or loss (net after taxes) Total comprehensive income Net loss attributable to non-controlling interests Total comprehensive income attributable to non-controlling interests Dividends paid to non-controlling interests	2022	2021
	$49,495	$10,127
	($ 193,216) ( 27,558)	($ 73,556) ( 12,557)
	($220,774)	($ 86,113)
	($ 42,101)	($ 16,028)
	($ 48,106)	($ 18,764)
	$ -	$ -

(C) Statement of Cash Flows:

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LILYTEX INTERNATIONAL CORP. and its

	LILYTEX INTERNATIONAL CORP. and its	LILYTEX INTERNATIONAL CORP. and its
Net cash generated by operating activities (outflow) Net cash used in investing activities Net cash generated by (used in) financing activities Effect of exchange rate changes on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year	subsidiaries
	2022 ($ 19,443) ( 1,508) 18,444 389 ( 2,118) 22,329 $ 20,211	2021
		$ 66,142 ( 2,210) ( 7,263) ( 59,147)
		( 2,478) 24,807
		$ 22,329

4. Foreign Currency Conversion

(1) The items listed in the Group's financial statements are all measured in terms of the currency of the primary economic environment in which the entity operates (the functional currency). The financial statements are presented in New Taiwan dollars, which is the Company's functional currency.
(2) When preparing each of the financial reports, transactions in currencies other than the parent company only functional currency (foreign currency) are recognized at the exchange rate on the transaction date, and at the end of the reporting period, monetary items of foreign currency are re-converted at the spot exchange rate on that date, and the exchange difference will be recognized as profit or loss of the current period. Foreign currency non-monetary items measured by fair value are converted at the exchange rate on the day when the fair value is determined, and the resulting exchange difference is listed as profit or loss for the year. However, if changes in fair value are recognized in other comprehensive profit or loss, the resulting exchange differences are recognized in other comprehensive profit or loss. Non-monetary items in foreign currencies measured at historical cost are translated at the exchange rate on the transaction date and will not be re-translated.
(3) For the preparation of financial statements, the assets and liabilities of overseas operating units are converted into NTD at the spot exchange rate at the end of the reporting period; items of income and expense are converted at the current average exchange rate, and the resulting exchange differences are recognized as other comprehensive profit or loss and accumulated in equity under the conversion of financial reports of overseas operating units (with appropriate allocation to non-controlling interests).
Classification of current and non-current assets and liabilities
(1) Assets that meet one of the following conditions are classified as current assets:
- A. The asset is expected to be realized in the normal cycle of business, or is intended to be sold or consumed.
- B. Held primarily for trading purposes.
- C. Those expected to be realized within twelve months after the balance sheet date.
- D. Cash or cash equivalents, unless exchanged, liquidated, or otherwise restricted more than twelve months after the balance sheet date.

The Group classifies all assets that do not meet the above conditions as non-current.

(2) Liabilities that meet one of the following conditions are classified as current liabilities:
A. Expected to be settled in the normal business cycle.
B. Held primarily for trading purposes.
C. Those that shall be repaid within twelve months after the balance sheet date. (Even if a long-term refinancing or rescheduling payment agreement has been completed after the balance sheet date and before the release of the financial report, it will also be the current liabilities).
D. Those who cannot unconditionally extend the repayment period to at least twelve months after the balance sheet date. The terms of the liability, which may be settled

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by issuing equity instruments at the option of the counterparty, do not affect its classification.

The Group classifies all liabilities that do not meet the above conditions as non-current.
1. Cash and cash equivalents
Cash and cash equivalents include cash on hand, cash in and short-term, highly liquid investments (including time deposits with an original maturity within three months) that can be converted into fixed amounts of cash at any time and whose value risk changes little.
Financial instruments

Financial assets and financial liabilities shall be recognized when the Company becomes a party to the contractual terms of the financial instrument. When financial assets and financial liabilities are originally recognized, they are measured at fair value. At the time of original recognition, the transaction costs directly attributable to the acquisition or issuance of financial assets and financial liabilities (except those classified as financial assets and financial liabilities measured at fair value through profit or loss) shall be added or subtracted from the fair value of the financial assets or financial liabilities.

Transaction costs directly attributable to financial assets and financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

(1) Financial assets
A. Types of measurement
```
 - Customary transactions of financial assets are recognized using transaction date accounting.

 - The types of financial assets held by the Group are financial assets measured at fair value through profit or loss, financial assets measured at amortized cost and equity instrument investments measured at fair value through other comprehensive profit or loss.
```
- (A) Financial assets measured at fair value through profit or loss Financial assets measured at fair value through profit or loss include those that are mandatorily classified and those designed. Financial assets that are mandatorily measured at FVPL include investments in equity instruments not designated by the Group to be measured at FVOCI, and investments in debt instruments that do not qualify for classification as measured at amortized cost or at fair value through other comprehensive income. A financial asset is designated on original recognition as fair value through profit or loss if that designation would eliminate or significantly reduce the measurement or recognition inconsistency.

Financial assets at fair value through profit or loss are measured at fair value with dividends, interest income and remeasurement gains or losses recognized in other gains and losses. Please refer to Note (12) for the determination method of fair value.

(B) Financial assets measured at amortized cost
- If the Group invests in financial assets that meet the following two conditions at the same time, it will be classified as financial assets measured at amortized cost:
a. Held under a business model whose purpose is to hold financial assets for the purpose of receiving contractual cash flows; and
b. The terms of the contract give rise to cash flows on specified dates that are exclusively payments of principal and interest on the outstanding principal amount.

Financial assets measured at amortized cost are measured upon original recognition at amortized cost to their gross carrying amounts determined using the effective interest method less any impairment losses, with any foreign exchange gains or losses recognized in profit or loss.

Except for the following two cases, interest income is calculated by multiplying the effective interest rate by the total book value of financial assets:

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a. For purchased or created credit-impaired financial assets, interest income is calculated by multiplying the credit-adjusted effective interest rate by the amortized cost of the financial asset.
b. For financial assets that are not purchased or created credit-impaired but subsequently become credit-impaired, the interest income is calculated by multiplying the effective interest rate by the amortized cost of the financial asset.
(C) Investments in equity instruments measured at fair value through other comprehensive income
- At the time of original recognition, the Group may irrevocably designate the equity instrument investment that is not held for trading and recognized as a contingent consideration by a business merger to be measured at fair value through other comprehensive gains and losses.

Investments in equity instruments measured at fair value through other comprehensive profit or loss are measured at fair value, with subsequent fair value changes presented in other comprehensive profit or loss and accumulated in other equity. When the investment is disposed of, the accumulated profit or loss is directly transferred to retained earnings and is not reclassified as profit or loss.

Dividends on investments in equity instruments at fair value through other comprehensive income are recognized in profit or loss when the Group's right to receive payment is established unless the dividend clearly represents a recovery of part of the cost of the investment.

B. Impairment of financial assets
(A) The Group evaluates financial assets (including accounts receivable) measured at amortized cost, debt instrument investments measured at fair value through other comprehensive profit and loss, debt instrument investments, and lease receivables and impairment losses of contract assets at fair value through other comprehensive income.
(B) Accounts receivable, contract assets and lease receivable are recognized as allowance for losses based on expected credit losses during the duration. For other financial assets, first, assess whether the credit risk has increased significantly since the original recognition. If there is no significant increase, the allowance loss will be recognized as the 12-month expected loss. If there is a significant increase, the provision loss shall be recognized according to the expected credit loss during the duration.
(C) Expected credit loss is the weighted average credit loss weighted by the risk of default. The 12-month expected credit loss represents the expected credit loss arising from possible default events of the financial instrument within 12 months after the reporting date, and the expected credit loss during the duration represents the expected credit loss arising from all possible default events of the financial instruments during the expected duration.
(D) Impairment losses on all financial assets are reduced by means of an allowance account to reduce their carrying amount, however, the allowance loss for debt instrument investments measured at fair value through other comprehensive profit or loss is recognized in other comprehensive profit or loss without reducing their carrying amount.
C. De-recognition of financial assets
- The Group will de-recognize financial assets when one of the following circumstances is met:
(A) Contractual rights to cash flows from financial assets lapse.
(B) The contractual rights to receive the cash flows of the financial asset are transferred and substantially all the risks and rewards of ownership of the financial asset have been transferred.
(C) Neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset, but retains control over the financial asset.

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When a financial asset is measured at amortized cost as a whole, the difference between its carrying amount and the consideration received is recognized in profit or loss. When an investment in a debt instrument at fair value through other comprehensive profit or loss is derecognized as a whole, the difference between its carrying amount and the sum of the consideration received plus any cumulative gain or loss that has been recognized in other comprehensive profit or loss is recognized in profit or loss. When an equity instrument investment measured at fair value through other comprehensive income is de-recognized as a whole, the cumulative gain or loss is transferred directly to retained earnings and is not reclassified as profit or loss.

(2) Equity instruments

The debt and equity instruments issued by the Group are classified as financial liabilities or equity according to the substance of the contract agreement and the definition of financial liabilities and equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of certain enterprise after deducting all of its liabilities. Equity instruments issued by the Group are recognized at the amount after deducting direct issuance costs from the obtained proceeds.

(3) Financial liabilities
A. Subsequent measurement
```
 - All financial liabilities are measured at amortized cost using the effective interest method except as follows:
```
- (A) Financial liabilities at fair value through profit or loss are financial liabilities held for trading or financial liabilities designated at fair value through profit or loss on initial recognition. Financial liabilities classified as held for trading are those whose main purpose at the time of occurrence is to repurchase them back in the short term, and derivatives other than financial guarantee contracts or designated and effective hedging instruments. When any financial liability meets one of the following conditions, the Group will designate it as measured at fair value through profit or loss at the time of original recognition:
```
- a. Being a mixed (combined) contract; or

- b. May eliminate or significantly reduce measurement or recognition inconsistencies; or

- c. An instrument that is managed and evaluated on a fair value basis in accordance with a written risk management policies.
```
- (B) Financial liabilities measured at fair value through profit or loss are measured at fair value at the time of original recognition, and the relevant transaction costs are recognized as current profit or loss. It is subsequently measured at fair value, and changes in its fair value are recognized in profit or loss for the current period.
- (C) Designated as a financial liability measured at fair value through profit or loss, the amount of change in fair value due to changes in credit risk is recognized in other comprehensive profit or loss, and will not be reclassified to profit or loss subsequently, and the remaining amount of change in fair value of the liability are reported in profit or loss. However, if the above-mentioned accounting treatment causes or aggravates the improper accounting ratio, the profit or loss of the liability shall be fully reported in profit or loss.

B. De-recognition of financial liabilities

 - The Group de-recognizes financial liabilities only when the obligation is discharged, canceled or lapsed. When financial liabilities are de-recognized, the difference between their carrying amount and the total consideration paid or payable (including any non-monetary assets transferred or liabilities assumed) is recognized in profit or loss.

(4) Modification of financial instruments

When the contract cash flow of a financial instrument is renegotiated or modified, if the financial instrument shall not be delisted, the Group will recalculate the total book value of the financial asset or the amortized cost of the financial liability by

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discounting the modified contract cash flow at the original effective interest rate, and recognizes the modified benefit or loss as profit or loss; and the incurred cost or charge will serve as an adjustment to the book value of the modified financial instrument and amortized over the remaining period after modification. If the renegotiation or modification results in the delisting of the financial instrument, it shall be handled in accordance with the de-recognition regulations.

Inventory

Inventories are measured on the basis of the lower of cost and net realizable value, and the perpetual inventory system is adopted, and the cost is determined by the weighted average method. The cost of finished goods and work in progress include raw materials, direct labor costs, other direct costs and overhead related to production (assigned to normal production capacity), but excludes borrowing costs. When comparing the lower of the cost and the net realizable value, the item-by-item comparison method is adopted. The net realizable value refers to the estimated selling price in the normal course of business minus the estimated cost to be invested to complete the project and the estimated cost required to complete the sale. balance.

Real estate and construction land
(1) Real estate and construction land are accounted for at actual cost. The part of the house that has been delivered is apportioned according to the selling price ratio to calculate profit and loss. At the end of the period, it is evaluated based on the lower of cost and net realizable value.
(2) The recognition of profit and loss adopts the cost recovery method.
(3) The business cycle is adopted as the criterion for dividing current and non-current.
Non-current assets to be sold (or disposal group)
When the carrying amount of non-current assets (or disposal groups) is mainly recovered through sales transactions rather than continued usage and it is highly likely to be sold, they will be classified as assets held for sale measured at the lower of its book value and fair value less costs of sales.
Investments using the equity method - Affiliated enterprises
(1) Affiliated enterprises refer to all entities over which the Group has significant influence but no control, generally directly or indirectly holding more than 20% of their voting shares. The Group adopts the equity method to dispose of the investment in affiliated enterprises, and recognizes it at cost when acquired.
(2) The Group recognizes the share of profit and loss acquired by the affiliated enterprises as profit and loss of the current period, and the share of other comprehensive profit and loss acquired by the Group as other comprehensive profit or loss. If the Group's share of losses to any affiliated enterprise is equivalent to or exceeds its equity in the affiliated enterprise (including any other unsecured receivables), the Group will not recognize further losses unless the Group has any statutory or constructive obligations to, or has paid on behalf of the affiliated enterprise.
(3) The unrealized gains and losses arising from transactions between the Group and affiliated enterprises have been eliminated in proportion to its equity in the affiliated enterprises; unless there is further evidence that the assets transferred in the transaction have been impaired, unrealized losses will also be eliminated. The accounting policies of the affiliated enterprises have been adjusted as necessary to be consistent with the policies adopted by the Group.
(4) In the event that an affiliate enterprise issues new shares, and the Group does not subscribe to the new shares in accordance with the proportion, resulting in a change in the investment ratio but still having a significant impact on it, the increase or decrease of the change in the net equity value is to adjust the "capital surplus" and "investments accounted for under the equity method". If the proportion of investment is reduced, in addition to the above-mentioned adjustments, the gains or losses related to the reduction of ownership interests that have been previously recognized in other comprehensive profit or loss, and the gains or losses must be reclassified to profit or loss when disposing of related assets or liabilities, it shall be reclassified to profit or loss according to the reduction ratio.

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(5) When the Group loses its significant influence on the affiliated enterprise, the remaining investment in the original affiliated enterprise will be re-measured according to the fair value, and the difference between the fair value and the book value will be recognized as the profit and loss of the current period.
(6) When the Group disposes of an affiliated enterprise and loses its significant influence on such affiliated enterprise, for all amounts previously recognized in other comprehensive profit or loss related to the affiliated enterprise, the accounting treatment is the same as if the Company directly disposes of the relevant assets or liabilities, that is, if the benefit or loss previously recognized as other comprehensive profit or loss will be reclassified as profit or loss when disposing of the relevant assets or liabilities, when control of the affiliated enterprise is lost, the benefit or loss will be reclassified from equity to profit or loss. If there is still a significant influence on the affiliated enterprises, only the amount previously recognized in other comprehensive profit and loss shall be transferred out in an above-mentioned manner on a proportionate basis.
(7) When the Group disposes of an affiliated enterprise, if it loses its significant influence on such affiliated enterprise, it will transfer the capital surplus related to the affiliated enterprise to profit or loss; if it still has a significant influence on the affiliated enterprise, it will be transferred to profit or loss according to the proportion of disposal.
1. Property, plant and equipment
(1) Property, plant and equipment are recorded on the basis of acquisition cost, and the relevant interest during the acquisition and construction period is capitalized. For property, plant and equipment under construction before they are ready for intended use, samples produced to test whether the assets can function normally are measured at the lower of cost and net realizable value, and the sales price and cost are recognized in profit or loss.
(2) Subsequent costs are included in the book value of the assets or recognized as a separate assets only when the future economic benefits related to the item are likely to flow into the Group and the cost of the item can be measured reliably. The book value of the replaced part shall be delisted. All other maintenance expenses are recognized as current profit or loss when incurred.
(3) Land is not depreciated. Other property, plant and equipment are depreciated using the straight-line method over their estimated useful lives using the cost model. The Group shall review the residual value, service life and depreciation method of each asset at the end of each financial year. If the expected value of the residual value and service life is different from the previous estimate, or the expected consumption pattern of the future economic benefits contained in the asset has changed significantly, from the date of the change it shall be in accordance with the International Accounting Standard No. 8 "Accounting Policies, Changes in Accounting Estimates and Errors” shall be treated in accordance with the regulations on changes in accounting estimates. The service life of each asset is as follows: Buildings 5-60 years

Machine and equipment 5-21 years Utility equipment 5-15 years Transportation equipment 2-12 years Miscellaneous 5-35 years

(4) When disposing of or not expected to generate future economic benefits from use or disposal, the property, plant and equipment will be de-recognized. The amount of profit or loss arising from the de-recognition of property, plant and equipment is the difference between the net disposal price and the book value of the asset, and is recognized in the current profit and loss.
Leases
(1) The Group evaluates whether the contract is (or includes) leases on the date of signing of the contract. For contracts that contain the lease component and one or more additional lease or non-lease components, the Group will allocate the consideration in the contract to the lease components based on the relative stand-alone price of each lease component and the aggregate stand-alone price of the non-lease components.

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A. Group as a lessee

Except for leases of low-value underlying assets and short-term leases, which are recognized as expenses on a straight-line basis, the Group recognizes right-of-use assets and liabilities on the lease starting date for other leases.

Right-of-use assets

The right-of-use asset is originally measured at cost (including the original measured amount of the lease liability, the lease payment less lease incentives received before the lease commencement date, the original direct cost and the estimated cost of restoring the underlying asset), then the measurement will be made at the cost less accumulated depreciation and accumulated impairment losses, and the remeasurement amount of the lease liability will be adjusted.

Except for right-of-use assets that meet the definition of investment real estate, right-of-use assets are presented in the balance sheet as the line item. For the recognition and measurement of right-of-use assets that meet the use definition of investment real estate, please refer to Note (4)14 “Accounting Policies for Investment Real Estate”.

The right-of-use asset is depreciated on a straight-line basis from the commencement date of the lease to the expiry of the service life or the expiry of the lease period, whichever is earlier, provided that the ownership of the underlying asset will be acquired at the expiry of the lease period, or if the cost of the right-of-use asset Reflecting the exercise of the purchase option, depreciation is provided from the lease commencement date to the expiry of the target asset's service life.

Lease liabilities

The lease liabilities are originally based on lease payments (including fixed payments, substantially fixed payments, variable lease payments that depend on an index or rate, the amount expected to be paid by the lessee under a residual value guarantee, the exercise price of a purchase option that is reasonably certain to be exercised, and the present value of the lease term reflecting the lessee’s termination penalty for exercising the option to terminate the lease, less the lease incentives received). If the interest rate implicit in the lease is easy to determine, the lease payment shall be discounted using the interest rate. If such rate is not readily determined, the lessee incremental borrowing rate will be used.

Subsequently, the lease liability will be measured on an amortized cost basis using the effective interest method, and the interest expense is amortized over the lease term.

If the lease period, the evaluation of the purchase option of the underlying asset, the expected payment amount under the residual value guarantee, or the index or rate adopted to determine the lease payment change result in changes in future lease payments, the Group will remeasure the lease liability and adjusts the right-of-use asset against it, except that if the carrying amount of the right-of-use asset has been reduced to zero, the remaining remeasured amount will be recognized in profit or loss. Lease liabilities are presented as line item in the balance sheet.

B. Group as a lessor

If the lease transfers almost all the risks and rewards attached to the ownership of the underlying asset, it is classified as a finance lease; otherwise, it is classified as an operating lease.

Under operating leases, lease payments after deducting lease incentives are recognized as lease income on a straight-line basis. The original direct cost incurred in obtaining the operating lease is added to the book amount of the underlying asset and recognized as an expense during the lease period on a straight-line basis.

Investment property

Investment real property is real property held to earn rentals or for capital appreciation or both (including real property under construction for such purposes). Investment real estate

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also includes land held for undetermined future use and right-of-use assets that meet the definition of investment real estate.

Investment real estate is originally measured at cost (including transaction costs), followed by the fair value model, and the gains or losses arising from changes in fair value are recognized in profit or loss in the year in which they occur.

Investment real estate is transferred to real estate, plant and equipment at the fair value on the date when it is first transferred for self-use.

When property, plant and equipment real estate is transferred to investment real estate at the end of self-use, the difference between the original book value and the fair value is listed in other comprehensive profit and loss, and is accumulated in the revaluation appreciation under other equity items. When being de-recognized, it will be directly transferred to into retained earnings.

The amount of profit or loss arising from the de-recognition of investment real estate is the difference between the net disposal price and the book value of the asset, and is recognized in the annual profit and loss.

Impairment of non-financial assets

On the date of balance sheet, the Group will estimate the recoverable amount of assets which may be subject to impairment, and recognize the impairment loss when the recoverable amount is lower than its book value. The recoverable amount is the fair value of an asset less costs of disposal or its value in use, whichever is higher. If the asset impairment recognized in the previous year does not exist, it shall be reversed within the scope of the provision for loss in the previous year.

Allowance for liabilities

Provision for liabilities is a present legal or constructive obligation due to past events, and it is likely to require outflow of resources with economic benefits to settle the obligation, and the amount of the obligation can be reliably estimated. The measurement of liability allowance is based on the best estimated present value of the expenditure required to pay off the obligation on the balance sheet date. The discount rate adopts the pre-tax discount rate that reflects the current market assessment of the time value of money and the specific risks of liabilities, and the amortization of the discount is recognized as interest expense. Future operating losses shall not be recognized as a liability allowance.

Employee benefits
(1) Short-term employee benefits

Short-term employee benefits are measured at non-discounted amounts expected to be paid and are recognized as an expense when the related service is rendered.

(2) Pension
A. Defined contribution plan

For the definite allocation plan, the amount of the pension fund that should be appropriation is recognized as the current pension cost on the accrual basis. Advance payments are recognized as assets to the extent that they are refundable in cash or reduce future payments.

B. Defined benefits plan
- (A) The net obligation under the defined benefit plan is calculated by discounting the amount of future benefits earned by the employee in the current period or past service, and the fair value of the planned assets is subtracted from the present value of the defined benefit obligation on the balance sheet date. The net defined benefit obligation is calculated annually by the actuary using the projected unit benefit method, and the discount rate is the market yield rate of government bonds (on the balance sheet date) that are consistent with the currency and period of the defined benefit plan on the balance sheet date.
- (B) Remeasurements arising from defined benefit plans are recognized in other comprehensive profit or loss in the period in which they occur, and are expressed in retained earnings.
- (C) Expenses related to upfront service costs are recognized immediately in profit or loss.
(3) Remuneration for employees and directors and supervisors

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Employee remuneration and remuneration of directors and supervisors are recognized as expenses and liabilities when there are statutory or constructive obligations and the amount can be estimated reasonably. If there is a discrepancy between the actual distribution amount and the estimated amount in subsequent resolutions, it shall be treated as a change in accounting estimate.

(4) Severance benefits
- Severance benefits are benefits provided when the employee's employment is terminated before the normal retirement date or when the employee decides to accept the company's welfare offer in exchange for the termination of employment. The Group recognizes the expense when the offer of severance benefits cannot be revoked or when the related restructuring costs are recognized, whichever occurs earlier. Benefits that are not expected to be fully settled within 12 months after the balance sheet date are discounted.
Capital and treasury stocks
(1) Capital

Common stock is classified as equity.

Incremental costs directly attributable to the issue of new shares or share options are included in equity as a reduction of the price.

(2) Treasury stocks
The Group recovers the stocks issued and recognizes them as "treasury stocks" according to the consideration paid at the time of repurchase (including directly attributable costs) as the deduction of equity. If the disposal price of the treasury stock is higher than the book value, the difference is listed as capital reserve - treasury stock transaction; if the disposal price is lower than the book value, the difference will be offset against the capital surplus generated by the transaction of the same type of treasury stock, if there is any deficit, the retained surplus will be debited. The book value of treasury stocks is weighted average and calculated separately according to the reasons for withdrawal.

When treasury stocks are canceled, the capital reserve shall be debited in proportion to the shareholding ratio - stock issuance premium and share capital. If the book value is higher than the total face value and stock issuance premium, the difference will be offset against the capital surplus generated by the transaction of the same type of treasury stocks, and if there is any deficit, it will be offset against the retained earnings; if its book value is lower than the total of the face value and the stock issuance premium, it will be credited to the capital surplus generated by the exchange of the same type of treasury stocks.

Income tax
(1) The tax expense for the period comprises current and deferred tax. Income taxes are recognized in profit or loss, except for income taxes that relate to items that are recognized in other comprehensive profit or loss or directly in equity, respectively.
(2) The current income tax is calculated based on the taxable income generated by the Group's operations, using the tax rate that has been enacted or substantively enacted on the date of balance sheet. The management level periodically assesses the status of income tax filings with respect to applicable income tax regulations and, where applicable, estimates income tax liabilities based on the expected tax payments to the taxation competent authorities. Income tax is levied on the undistributed earnings calculated in accordance with the provisions of the Income Tax Act of Taiwan. In the year following the year in which the earnings are generated, after the shareholders' meeting approves the earnings distribution proposal, the income tax expense will be recognized based on the distribution of the actual earnings.
(3) The balance sheet method is adopted for deferred income tax, which is recognized according to the temporary difference between the tax basis of assets and liabilities and their carrying amount on the balance sheet. Deferred income tax liabilities arising from the original recognition of goodwill are not recognized if the deferred income tax arises from the original recognition of assets or liabilities in a transaction (excluding business combinations) and at the time of the transaction If it does not affect accounting profit or taxable income (tax loss), it will not be recognized. For temporary differences related

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to investment in subsidiaries and affiliated enterprises, if the Group can control the timing of the reversal of the temporary difference and it is highly likely that the temporary difference will not reverse in the foreseeable future, it will not be recognized. The deferred income tax is based on the tax rate (and taxation laws) that has been enacted or substantively enacted on the balance sheet date and is expected to be applicable when the relevant deferred income tax assets are realized or the deferred income tax liabilities are settled.

(4) Deferred income tax assets are recognized within the scope of temporary differences, unused tax losses and unused income tax credits that are likely to be available in future taxable income, and are reassessed on each balance sheet date. Evaluate unrecognized and recognized deferred tax assets.
(5) When there is a legally enforceable right to offset the recognized current income tax assets and liabilities and there is an intention to pay off on a net basis or to realize the assets and liquidate liabilities at the same time, the current income tax assets and current income tax liabilities will be mutually offset against each other; when there is a legally enforceable right to offset the current income tax assets and current income tax liabilities, and the deferred income tax assets and liabilities are levied by the same taxation competent authority, or when different taxpayers generate but each intends to pay off on a net basis or realize assets and settle liabilities at the same time, the deferred income tax assets and liabilities will be offset against each other.
(6) Income tax deduction accounting is adopted for tax incentives arising from the purchase of equipment or technology, research and development expenditures, personnel training expenditures, and equity investment.
Revenue recognition
The Group's revenue recognition principle from customer contracts is to recognize revenue in the following steps:
(1) Identify customer contracts;
(2) Identify the performance obligations in the contract;
(3) Determine the transaction price;
(4) Allocate the transaction price to performance obligations in the contract; and
(5) Revenue is recognized when performance obligations are met.

After the Group identifies the performance obligations in the customer contract, it will allocate the transaction price to each performance obligation, and recognizes revenue when each performance obligation is satisfied.

For contracts where the time interval between the transfer of goods or services and the receipt of consideration is within one year, the transaction price shall not be adjusted for its significant financial components.

(6) Sale of products

The Group recognizes revenue when control of the product is transferred to the customer. The transfer of control of the product means that the product has been delivered to the customer and there are no outstanding obligations that would affect the customer's acceptance of the product. Delivery is the point at which the customer has accepted the product in accordance with the transaction conditions, the risk of obsolescence and loss has been transferred to the customer, and the Group has objective evidence that all acceptance conditions have been met.

The Group lists the accounts receivable when the products are delivered since the Group is entitled to receive the consideration at that point.

For processing subcontract, the control of the ownership of the processed products has not been transferred, so revenue is not recognized when subcontracting.

(7) Provision of services

The services provided by the Group are mainly warehouse leasing and tallying services entrusted by customers, and the revenue is recognized when the promised services are delivered to the customers (when the customers obtain control of the assets) and there is no subsequent obligation.

Borrowing costs

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Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset are included as part of the cost of the asset until substantially all activities necessary to bring the asset to its intended use or sale have been completed.

Investment income earned on the temporary investment of specific borrowings prior to the occurrence of eligible capital expenditures is deducted from the borrowing costs eligible for capitalization.

Except for the above, all other borrowing costs are recognized as profit or loss in the period in which they are incurred.

Government grants

Government grants are recognized at fair value once it is reasonably convinced that the Group complies with the conditions for subsidies and will be receiving the subsidies. Government grants are recognized in profit or loss on a systematic basis over the period in which they are intended to compensate the associated costs that are recognized as an expense by the Group. Government grants are recognized in profit or loss during the period in which they can be received if they are used to compensate for expenses or losses incurred, or to provide immediate financial support to the Group and have no future related costs. For government loans obtained by the Group with interest rates below the market, the difference between the loan amount received and the fair value of the loans calculated based on the prevailing market interest rate is recognized as a government grant.

Operating segments

An operating segment is a constituent unit of an enterprise that engages in business activities that may generate income and incur expenses (including income and expenses arising from transactions with other constituent units within the enterprise). The operating results of the operating segment are regularly reviewed by the operating decision-maker of the enterprise to make decisions on resource allocation to the department and evaluate the performance of the department, with separate financial information.

(V) Significant Accounting Judgments, Estimates and Assumptions

The Group takes into account the economic impact caused by COVID-19 epidemic/climate change and related government policies and regulations/military conflict between Russia and Ukraine and related international sanctions/inflation and market interest rate fluctuations into major accounting estimates, and continues to review basic assumptions and estimates. If the revision of the estimate only affects the current period, it will be recognized in the revision period; if the revision of the accounting estimate affects both the current period and the future period, it will be recognized in both the revision period and the future period.

When the Group prepares the financial statements, the important judgments, accounting estimates and assumptions adopted in the accounting policies are as follows:

Important judgments on the adoption of accounting policies
(1) Judgment on business model of financial asset classification
- The Group evaluates the business model to which financial assets belong based on the level that reflects the joint management of financial asset groups to achieve specific business objectives. This assessment considers all relevant evidence, including how the asset's performance is measured, the risks affecting performance, and how the compensation of relevant managerial officers is determined, and requires the use of judgment. The Group continues to assess whether its business model judgment is appropriate, and for such purpose, monitors financial assets measured at amortized cost and debt instrument investments measured at fair value through other comprehensive profit and loss that are delisted before the maturity date to understand the reasons for its disposal of assess whether the disposition is consistent with the objectives of the business model. If it is found that the business model has changed, the Group will reclassify financial assets in accordance with the provisions of IFRS 9, and postpone the application from the date of reclassification.
- A. The Group makes judgement in accordance with IFRS 15 to determine whether it has obtained or not the control of specific products or services before transferring them to the customer, and will be the principal or agent in the transaction. If it is determined as a transaction as an agent, the net transaction amount will be recognized as revenue.

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In any of the following circumstances, the Group shall be the principal:

(A) The Group obtains control of the products or other assets from the other party before the products or other assets are transferred to the customers; or
(B) The Group controls the right to provide labor services by the other party, so as to obtain the ability to instruct that party to provide services to customers on behalf of the Company; or
(C) The Group obtains control of products or services from the other party to combine with other products or services to provide specific products or services to customers.
B. The indicators adopted to assist in judging whether the Group controls the specific products or services before transferring them to customers include (but not limited to):
(A) The Group is primarily responsible for fulfilling the commitment to provide specific products or services.
(B) The Group assumes inventory risk before and after the transfer of specific products or services to customers.
(C) The Group has the discretion to determine the price.
(2) Lease Period
When determining the lease period, the Group considers all relevant facts and circumstances that create economic incentives to exercise (or not exercise) the option, including all expected changes in facts and circumstances from the starting date to the date when the option is exercised. Factors considered include the terms and conditions of the contract for the period covered by the option, significant leasehold improvements made (or expected to be made) during the contract period, and the importance of the underlying asset to the Group's operations, among others. When major events or major changes in circumstances occur within the Group's control, the lease period shall be reassessed.
(3) Judgment of significant influence on affiliated enterprises Situations where the investee holds less than 50% of the voting shares and is the single largest shareholder, but only has significant influence without control or joint control:
A. As stated in Note (6)11 "Investments Accounted for Using Equity Method", the Group holds 44.76% of the voting rights of SUNNY LOGISTICS CO., LTD. and is the single principal shareholder of SUNNY LOGISTICS CO., LTD. However, the decision-making unit of SUNNY LOGISTICS CO., LTD.’s relevant activities is the board of directors, and the Group has not been elected as a director of SUNNY LOGISTICS CO., LTD., and hence it cannot instruct the business decision-making. Therefore, the Group only has significant influence but no control over SUNNY LOGISTICS CO., LTD., so it is listed as an affiliated enterprise of the Group.
B. As stated in Note (6)11 "Investments Accounted for Using Equity Method", the Group holds 44.91% of the voting rights of LILY CONSTRUCTION CO., LTD. and is the single principal shareholder of LILY CONSTRUCTION CO., LTD. However, the decision-making unit of LILY CONSTRUCTION CO., LTD.’s relevant activities is the board of directors, and the Group has not been elected as a director of LILY CONSTRUCTION CO., LTD., and hence it cannot instruct the business decision-making. Therefore, the Group only has significant influence but no control over LILY CONSTRUCTION CORP., so it is listed as an affiliated enterprise of the Group.
C. As stated in Note 6(11) "Investments Accounted for Using Equity Method", the Group holds 46.27% of the voting rights in GIANTEX TEXTILE CORPORATION and is the single largest shareholder of GIANTEX TEXTILE CORPORATION. However, the decision-making unit of GIANTEX TEXTILE CORPORATION’s relevant activities is the board of directors, and the Group has not been elected as a director of GIANTEX TEXTILE CORPORATION, and hence it cannot instruct the business decision-making. Therefore, the Group only has significant influence but no control over GIANTEX TEXTILE CORPORATION, so it is listed as an affiliated enterprise of the Group.

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Important accounting estimates and assumptions
(1) Revenue recognition
- Sales revenue is recognized when performance obligations are met by transferring control of goods or services to customers, net of estimated related sales returns, discounts and other similar allowances. These sales returns and discounts are estimated based on historical records and other known reasons, and the Group regularly reviews the rationality of the estimates.
(2) Impairment of financial assets
- Estimated impairments on accounts receivable, debt instrument investments and financial guarantee contracts are based on the Company's assumptions about default rates and expected loss rates. The Company considers historical experience, current market conditions and forward-looking information to formulate assumptions and select inputs for impairment assessments. If the actual future cash flow is less than expected, significant impairment losses may arise.
(3) Fair value measurement and evaluation process

When there is no market quotation for the assets and liabilities measured by fair value in the active market, the Company will decide whether to outsource the valuation and determine the appropriate fair value evaluation technology according to relevant laws and regulations or based on judgments. If the level 1 input value cannot be obtained when estimating the fair value, the Group takes reference to the analysis of the investee's financial status and operating results, recent transaction prices, quotations of the same equity instruments in non-active markets, and quotations of similar instruments in active markets and comparable company valuation multiples, etc. to determined the input values. If the actual change in the input value in the future is different from the expectation, changes in fair value may occur.

The Group regularly updates various input values according to market conditions to monitor whether the fair value measurement is appropriate.
(4) Impairment assessment of tangible and intangible assets
In the process of asset impairment assessment, the Group needs to rely on subjective judgments and based on asset usage patterns and industry characteristics to determine the independent cash flow of a specific asset group, the duration of assets, and potential future income and expenses. Any change in estimates due to changes in economic conditions or the Company's strategy may result in material impairment in the future.
(5) Impairment testing of investment using the equity method
When there is any indication of impairment that an investment using the equity method may have been impaired and hence the book value cannot be recovered, the Group immediately assesses the impairment of the investment. The Group evaluates the recoverable amount based on the discounted value of the expected future cash flow of the invested company or the discounted value of the expected cash dividend received and the future cash flow generated by disposing of the investment, and analyzes the rationality of the relevant assumptions.
(6) Realization of deferred tax assets Deferred income tax assets are only recognized when it is highly likely that there will be sufficient taxable income in the future for the use of deductible temporary differences. When assessing the realizability of deferred income tax assets, management must involve significant accounting judgments and estimates, including assumptions such as expected future sales revenue growth and profit margins, tax holidays, available income tax credits, and tax planning. Any changes in the global economic environment, industry environment, and laws and regulations may cause major adjustments to deferred income tax assets.
(7) Evaluation of inventory

Since inventories shall be priced at the lower of cost and net realizable value, the Group will adopt judgment and estimation to determine the net realizable value of inventories on the date of balance sheet. The Group evaluates the amount of inventory due to normal wear and tear, obsolescence or of no market value on the date of balance sheet, and writes off the inventory cost to the net realizable value.

(8) Calculation of net defined benefit liabilities

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When calculating the present value of a defined benefit obligation, the Group will adopt judgment and estimation to determine the relevant actuarial assumptions on the date of balance sheet, including the discount rate and the expected return rate of project assets. Any change in actuarial assumptions may significantly affect the amount of the Company's defined benefit obligations.

(9) Financial assets - Fair value measurement of stocks of listed/OTC companies without an active market

The fair value of listed/OTC company stocks held by the Company without an active market is mainly estimated by referring to recent financing activities, evaluations of companies of the same type, company technology development, market conditions and other economic indicators. Any changes in judgments and estimates may affect the measurement of its fair value. For the description of the fair value of financial instruments, please refer to Note (12)3(2).

(VI) Contents of Significant Accounts

1. Cash and cash equivalents

ntents of Significant Accounts ash and cash equivalents
Items Cash Demand deposit Checking deposits Foreign currency deposits Time deposits Total	December 31, 2022 $ 701 30,199 51,641 10,713 39,687 $132,941	December 31, 2021
		$ 634 33,505 71,124 65,953 -
		$171,216

(1) The credit quality of the financial institutions that the Group interacts with is good, and the Group interacts with a number of financial institutions to diversify the credit risk, and the risk of default is expected to be very low.

(2) The Group has not pledged cash and equivalent cash.

2. Financial asset measured at fair value through profit or loss

Items Mandatorily measured at fair value through profit or loss: Listed/OTC stocks	December 31, 2022 $4,763	December 31, 2021
		$ 6,217

(1) The net losses recognized by the Group in 2022 and 2021 were NT$114 thousand and NT$1,839 thousand, respectively.

(2) The Group has not pledged financial assets at fair value through profit or loss.

(3) Please refer to Note (12) for the relevant credit risk management and assessment methods.

3. Financial assets measured at fair value through other comprehensive income

Items Current: Equity instruments Domestic listed/OTC stocks Valuation adjustment Total Non-current: Equity instruments Domestic listed/OTC stocks Domestic non-listed/non-OTC stocks Subtotal Valuation adjustment	December 31, 2022 $ 10,698 ( 4,874) $ 5,824 $ 22,885 76,224 99,109 54,137	December 31, 2021
		$ 10,698 ( 4,695)
		$ 6,003
		$ 22,885 63,276
		86,161 39,375

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Total $ 153,246 $ 125,536

(1) The Group chooses to classify the investment in CHINA WIRE & CABLE CO., LTD., which receives stable dividends, as financial assets measured at fair value through other comprehensive income. The fair values of these investments on December 31, 2022 and 2021 were respectively NT$5,824 thousand and NT$6,003 thousand.
(2) The Group invests in the common stocks of EVERTEX FABRINOLOGY LTD. and other companies according to the medium and long-term strategic objectives, and expects to make profits through long-term investment. The Group's management level believes that if the short-term fair value fluctuations of these investments are included in profit or loss, it will be inconsistent with the aforementioned long-term investment plan, so it chooses to designate these investments to be measured at fair value through other comprehensive income.
(3) Please refer to Note (12) for the relevant credit risk management and assessment methods.

4. Notes receivable, net

Notes receivable, net
Items Notes receivable Occurred due to operating activities Less: loss allowance Notes receivable, net	December 31, 2022 $ 7,407 ( 72) $ 7,335	December 31, 2021
		$ 26,396 ( 72)
		$26,324

(1) The Group's notes receivable have not been discounted or pledged.

(2) Please refer to the following net accounts receivable for the relevant disclosure of allowance loss on notes receivable.
Accounts receivable, net

Accounts receivable, net
Items Accounts receivables Less: loss allowance Accounts receivable, net	December 31, 2022 $ 157,869 ( 23,627) $134,242	December 31, 2021
		$ 201,496 ( 9,021)
		$192,475

(1) The Group's accounts receivable that are not overdue and have not been impaired all meet the credit standards set based on the counterparty's industrial characteristics, business scale, and profit-making status, and the average credit period is 90-120 days.
(2) Please refer to Note (12) for the relevant credit risk management and assessment methods.
(3) The Group's accounts receivable have not been pledged.
(4) The Group adopts a simplified method to recognize the allowance loss of notes receivable and accounts receivable based on the expected credit loss during the duration. The expected credit loss during the duration is based on considering the customer's past default record and current financial and economic conditions, while considering the industry outlook to adjust the loss rate established by historical and realistic information. The Group measures the allowance loss of notes receivable and accounts (including other receivables, collections and related parties) according to the reserve matrix as follows:

Expected[Allowance for losses ] credit (Indirect expected credit loss December 31,[Total carrying ] Loss rate during the duration Amortized cost 2022 amount period) Not overdue - $ 187,531 $ - $ 187,531

Not overdue

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Overdue 0-30 days Overdue 31-90 days Overdue for more than 91 days Total December 31, 2021 Not overdue Overdue 0-30 days Overdue 31-90 days Overdue for more than 91 days Total	1% or above 5% or above 20% or above Expected credit Loss rate - 1% or above 5% or above 20% or above	8,337 6,305 38,275 $240,448 Total carrying amount $ 274,297 - 521 38,366 $ 313,184	83 315 37,148 $ 37,546 Allowance for losses (Indirect expected credit loss during the duration period) $ - - 26 24,609 $24,635	8,254 5,990 1,127
				$202,902
				Amortized cost
				$ 274,297 - 495 13,757
				$288,549

(5) Changes in notes receivable and allowance for receivables (including other receivables and collections) are as follows:

Items Beginning balance Add: Provision for impairment loss Less: Write-off due to inability to recover Consolidated changes of entities Foreign Currency Conversion Difference Ending balance	2022 $ 24,635 12,557 - - 354 $ 37,546	2021
		$ 124,708 82 ( 4,751) ( 95,518) 114
		$24,635

The Group does not hold any collateral or other credit enhancements over these accounts receivable.

(6) The Group's impairment losses on accounts receivable in 2022 and 2021 are respectively NT$12,557 thousand and NT$82 thousand.

6. Net other receivables

Net other receivables
Items Tax refund receivable Proceeds receivable Other receivables - Others Less: loss allowance Net amount	December 31, 2022 $ 2,734 756 31,660 ( 7,548) $27,602	December 31, 2021
		$ - 302 46,093 ( 7,431)
		$ 38,964

7. Inventory

nventory
Items Raw materials Materials WIP	December 31, 2022 $ 18,018 7 3,832	December 31, 2021
		$ 28,316 25 6,258

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Finished goods Products Total	28,216 1,323 51,396	17,708 2,478
		54,785

(1) Inventory-related (loss) gains recognized as cost of sales of products in the current period are as follows:

period are as follows:
Costs of sales of inventory Inventory price recovery benefit Warehousing costs Costs of transferring of the discontinued units Total operating costs	2022 $ 231,142 ( 956) 271,245 - $ 501,431	2021
		$ 392,209 ( 489) 222,876 ( 4,799)
		$ 609,797

(2) In 2022 and 2021, the Group raised the prices of some products and cleared some inventories or wrote off the inventories to the net realizable value, resulting in NT$956 thousand and NT$489 thousand in inventory price recovery benefits, respectively.

(3) The Group does not pledge the inventory.

8. Real estate and construction land

Items Houses and parking spaces for sale Construction land Total Less: Loss allowance for falling price Net amount	December 31, 2022 $ 3,060 1,858 4,918 - $ 4,918	December 31, 2021
		$ 3,060 1,858
		4,918 -
		$ 4,918

(1) The interest capitalization amount of the premises for sale and construction land in both 2022 and 2021 is NT$0 thousand.

(2) The Group does not pledge the real estate and construction land.

Non-current assets to be sold (net) and discontinued units

(1) On March 23, 2017, the Group was approved by the board of directors to discontinue the production at Pingzhen Cotton Factory and transfer the related assets and liabilities into the disposal group to be sold, which is expressed as a discontinued unit in line with the its definition. The sale transaction of the disposal group to be sold was completed in June 2019.

(2) The cash flow information of the discontinued unit is as follows:

Cash flows from operating activities Cash flows from investing activities: Cash flows from financing activities: Total cash flow	2022 $ - - - $-	2021
		($ 2,621) - -
		($2,621)

(3) Assets classified as disposal group for sale: None.

(4) Liabilities classified as disposal group for sale: None.

(5) Accumulated income or expenses recognized in other comprehensive profit or loss related to the disposal group classified as pending sale: None.

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(6) The analysis of the operating results of the discontinued units and the results of re-measurement and recognition of assets or groups to be disposed of is as follows:

follows:
Profit or loss from operating Operating revenue Operating costs and operating expenses Pre-tax operating loss of discontinued units Income tax (expense) benefit After-tax operating loss of discontinued units (A) Disposal gains (loss) of assets of discontinued units and measurement gains (loss) based on net fair value Pre-tax asset disposal gains (loss) and net fair value measurement gains (loss) of discontinued units Income tax (expense) benefit Disposal gains (loss) of assets of discontinued units and measurement gains (loss) based on net fair value (B) Loss of discontinued units (A＋B)	2022	2021
	$ - -	$ 3,925 ( 6,546)
	- -	( 2,621) -
	$-	($2,621)
	$ - -	$ - -
	$ -	$ -
	$ -	($ 2,621)

(7) Liabilities directly related to non-current assets to be sold: None.

10. Other financial assets - Current

Other financial assets - Current
Items Restricted time deposit (within one year) Reserve deposit Total	December 31, 2022	December 31, 2021
	$ 181,533 5,011 $186,544	$ 178,253 2,744
		$180,997

Please refer to Note (8) for information on providing guarantees with other financial assets-liquidity.

Investment accounted for under the equity method
(1) Investment subsidiary

The Group's subsidiaries are listed as follows:

Investees	December 31, 2022 Carrying amount Shareholding $ - -	December 31, 2022 Carrying amount Shareholding $ - -	December 31, 2021 Carrying amount Shareholding $ 11 98.67
		Shareholding
LILYTEX INTERNATIONAL CORP.		-

It is determined that the subsidiary LILYTEX INTERNATIONAL CORP. will be dissolved on October 1, 2021. The Company lost its significant influence on the subsidiary from that day on and ceased the application of the equity method. LILYTEX INTERNATIONAL CORP. was liquidated on June 13, 2022.

(2) Investment affiliated enterprise:

Investees	December 31, 2022	December 31, 2022	December 31, 2021 Carrying amount Shareholding $ 159,899 44.76 172,180 44.91 6,701 46.27 $338,780
	Carrying amount	Shareholding
SUNNY LOGISTICS CO., LTD. LILY CONSTRUCTION CO., LTD. GIANTEX TEXTILE CORPORATION Total	$ 200,500 173,411 12,891	44.76 44.91 46.27	$ 159,899 172,180 6,701 $338,780
	$386,802

The Company sold 2,800 thousand shares of GIANTEX TEXTILE CORPORATION in November 2021. After the sale, the shareholding was reduced to 46.27%. The Company hence lost control over GIANTEX TEXTILE CORPORATION from that day but maintained significant influence, and it will be classified as an affiliated enterprise.

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(3) The shares of individual insignificant affiliated enterprises of the Group are summarized as follows:

summarized as follows:
Share: Net income Other comprehensive income or loss (net after taxes) Total comprehensive income	2022 $ 10,696 37,326 $48,022	2021
		$ 147,974 44,113
		$192,087

12. Property, plant and equipment

roperty, plant and equipment
Items Land Buildings Machine and equipment Other equipment Equipment to be inspected and unfinished projects Total costs Less: Accumulated depreciation Total	December 31, 2022 $ 2,101,323 1,899,367 193,325 888,838 290,050 5,372,903 ( 963,554) $4,409,349	December 31, 2021
		$ 2,101,323 1,867,307 193,325 869,004 103,257
		5,134,216 ( 889,666)
		$4,244,550

Costs	Land	Buildings	Machine and equipment	Other equipment	Equipment to be inspected and unfinished projects	Total
	$ 2,101,323 - - - -	$ 1,867,307 3,295 ( 11,906) 40,671 -	$ 193,325 - - - -	$ 869,004 12,989 - 6,834 11	$ 103,257 229,992 - ( 43,199) -	$ 5,134,216 246,276 ( 11,906) 4,306 11
Balance as of January 1, 2022 Addition Disposal Reclassification Impact of foreign currency exchange differences Balance as of December 31, 2022 Accumulated depreciation and impairment
	$ 2,101,323	$ 1,899,367	$ 193,325	$ 888,838	$ 290,050	$ 5,372,903
	$ - - - -	$ 418,205 54,227 ( 11,906) -	$ 192,698 261 - -	$ 278,763 31,302 - 4	$ - - - -	$ 889,666 85,790 ( 11,906) 4
Balance as of January 1, 2022 Depreciation Disposal Impact of foreign currency exchange differences Balance as of December 31, 2022
	$ -	$ 460,526	$ 192,959	$ 310,069	$ -	$ 963,554

Costs	Land	Buildings	Machine and equipment	Other equipment	Equipment to be inspected and unfinished projects	Total
	$ 1,750,124 -	$ 1,524,553 17,061	$ 116,742 -	$ 729,639 7,700	$ 341,107 255,866	$ 4,462,165 280,627
Balance as of January 1, 2021 Addition

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Disposal Consolidated changes of entities Reclassification Impact of foreign currency exchange differences Balance on 2021.12.31 Accumulated depreciation and impairment	- 351,199 - -	( 6,535) ( 96,815) 429,043 -	- 76,583 - -	( 662) ( 57,837) 190,158 6	- - ( 493,716) -	( 7,197 273,130 125,485 6
	$ 2,101,323	$ 1,867,307	$ 193,325	$ 869,004	$ 103,257	$ 5,134,216
	$ - - - - -	$ 430,132 39,457 ( 6,535) ( 44,849) -	$ 115,752 363 - 76,583 -	$ 307,738 26,058 ( 660) ( 54,375) 2	$ - - - - -	$ 853,622 65,878 ( 7,195 ( 22,641 2
Balance as of January 1, 2021 Depreciation Disposal Reclassification Impact of foreign currency exchange differences Balance on 2021.12.31
	$ -	$ 418,205	$ 192,698	$ 278,763	$ -	$ 889,666

(1) The property, plant and equipment of the Group are mainly for self-use purposes. (2) The additions in this period and the cash flow acquisition of property, plant and equipment are adjusted as follows:

Items Increase of property, plant and equipment Increase (decrease) of payable equipment fees Cash paid	2022 $ 246,276 ( 5,450) $240,826	2021
		$ 280,627 2,286
		$282,913

(3) In 2022 and 2021, the capitalized amounts of unfinished construction and prepaid equipment interests of property, plant and equipment were NT$2,593 thousand and NT$4,146 thousand, respectively.
(4) There is no sign of impairment of property, plant and equipment, so impairment assessment has not been carried out.
(5) As of December 31, 2022 and 2021, due to legal restrictions, the Company is not yet able to register in the name of the Company, and the land temporarily registered in the name of the individual is NT$9,691 thousand. However, in order to ensure the rights and interests, the guarantee notes that the Company has obtained are all NT$19,506 thousand.
(6) Please refer to Note (8) for information on providing guarantees with property, plant and equipment.
Lease agreements
(1) Right-of-use assets

agreements ight-of-use assets
Items Transportation equipment Other equipment Total costs Less: Accumulated depreciation Accumulated impairments Total	December 31, 2022 $ 9,442 - 9,442 ( 1,525) - $ 7,917	December 31, 2021
		$ 7,831 2,273
		10,104 ( 8,931) -
		$ 1,173

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Costs	Transportation equipment	Other equipment	Other equipment
Balance as of January 1, 2022 Increase this period De-recognition of this period Balance as of December 31, 2022 Accumulated depreciation and impairment	$ 7,831 9,442 (7,831)	$ 2,273 - (2,273)
	$ 9,442	$ -
	Transportation equipment	Other equipment
Balance as of January 1, 2022 Depreciation De-recognition of this period Allocation (reversal) of impairment loss Balance as of December 31, 2022 Costs	$ 6,744 2,612 ( 7,831) -	$ 2,187 86 ( 2,273) -
	$ 1,525	$ -
	Transportation equipment	Other equipment
Balance as of January 1, 2021 Increase this period De-recognition of this period Balance on 2021.12.31 Accumulated depreciation and impairment	$ 7,831 - -	$ 2,273 - -
	$ 7,831	$ 2,273
	Transportation equipment	Other equipment
Balance as of January 1, 2021 Depreciation De-recognition of this period Allocation (reversal) of impairment loss Balance on 2021.12.31 ease liabilities Items	$ 4,134 2,610 - -	$	1,713 474 - -
	$ 6,744	$	2,187

(2) Lease liabilities

The discount rate range for the lease liability is as follows:

	December 31, 2022	December 31, 2021
Transportation equipment	1.37%-1.61%	1.61%
Other equipment	1.62%~1.74%	1.62%~1.74%
For the maturity analysis of	lease liabilities, please refer to Note (12)2.

(3) Important lease activities and terms

The Group leases some other equipment for use as business office. The lease period is from 2018 to 2025, with the right to renew the lease upon expiration of the lease period. The Group has included the lease renewal right after the lease period expires into the lease liabilities. In addition, according to the contract,

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without the consent of the lessor, the Group is not allowed to sublease the subject asset of the lease to others. As of December 31, 2022, there was no sign of impairment of the right-of-use asset, so no impairment assessment was performed.

(4) Sub-leasing

The Group subleases the leased land use rights and its above-ground factory buildings in Kunshan City, Jiangsu Province, China to other companies through operating leases. The relevant right-of-use assets are listed as investment real estate. Please refer to Note (6)14 Notes of "Investment Real Estate". The amount related to the above-mentioned right-of-use assets does not include the right-of-use assets that meet the definition of investment real estate.

(5) Other information on the leases
A. Please refer to Note (6)14 "Investment Real Estate" for the Group's agreement on leasing investment real estate under lease for operating.
B. In 2021 and 2020, the Group chose to apply the recognition exemption for short-term leases and low-value asset leases, and did not recognize the relevant right-of-use assets and lease liabilities for these leases.
C. The Group's lease information is as follows:

Items Expenses relating to short-term leases Low-value asset lease expenses Variable payment profit not included in lease liability measurement Lease cash outflow amount (Note)	2022 $- $134 $- ($2,891)	2021
		$-
		($453)
		$-
		($ 3,659)

(Note): It includes the principal payment of lease liabilities in the current period.

14. Investment property

nvestment property
Balance as of January 1, 2022 Added for the period Changes of fair value Net exchange differences Balance as of December 31, 2022	Buildings $ 439,022 1,508 ( 24,578) 7,882 $ 423,834	Right-of-use assets $ 487,039 - ( 13,476) 8,854 $ 482,417	Total
			$ 926,061 1,508 ( 38,054) 16,736
			$ 906,251

Balance as of January 1, 2021 Added for the period Changes of fair value Net exchange	Buildings $ 534,239 2,210 ( 101,935) 4,508	Right-of-use assets $ 427,146 - 55,663 4,230	Total
			$ 961,385 2,210 ( 46,272) 8,738

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differences Balance on 2021.12.31

$ 439,022 $ 487,039

$ 926,061

(1) The subsidiary Kunshan Lily Textile Co., Ltd. decided on July 18, 2018 to stop production and end its own use of the factory building, and lease the factory building. According to the provisions of International Accounting Standards No. 40 "Investment Real Estate", land use rights and building construction were reclassified as investment real estate and measured at fair value of NT$1,021,066 thousand, and recognized as real estate revaluation appreciation of NT$912,235 thousand. The right-of-use asset in the investment real estate is the land-use right leased by the Group in Kunshan City, Jiangsu Province, China, together with the houses and buildings on the land, which are sub-leased to other enterprises in the form of operating lease.
(2) Rental income and direct operating expenses of investment real estate:

Items Rental income from investment property Direct operating expenses incurred by investment property that generates rental income of the current period Investment property that generates rental income of the current period Direct operating expenses not incurred by investment property that generates rental income of the current period	2022 $ 49,495 $ 4,417 $ -	2021
		$ 10,127
		$ 4,371
		$ -

(3) The leasing period of the investment real estate lease is 5 to 10 years, and 3 months before the expiry of the lease period, a written notice is required to renew the lease, and a new lease contract is signed, otherwise it will be deemed as a waiver of the lease renewal.
The lessee shall adjust the rent according to the market rent when exercising the right to renew the lease. At the end of the lease period, the lessee does not have preferential purchase rights for the asset.
(4) The total amount of lease payments that the Group will receive in the future for leasing investment real estate under operating leases is as follows:

Year 1 Year 2 Year 3 Year 4 Year 5 More than 5 years	December 31, 2022 $ 48,620 48,620 58,565 61,880 61,880 402,662 $ 682,227	December 31, 2021 $ 41,100 47,740 47,740 58,590 60,760 451,071 $ 707,001

(5) Loss of investment real estate adjusted by fair value is as follows:

December 31, 2022 December 31, 2021 Outsourced appraisal $ 906,251 $ 926,061 The fair value of investment real estate on December 31, 2022 and 2021 was appraised on December 31, 2022 and 2021 by the Chengzheng Cross-Strait Real Estate Appraiser Firm, which is qualified as a real estate appraiser in Taiwan. On December 31, 2022, appraisers Lin, Jin-sheng and Huang,

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Huo-ming conducted the appraisal, and on December 31, 2021, appraisers Lin, Jin-sheng and Hsieh, Kun-long conducted the appraisal.

(6) Except for undeveloped land, the fair value of investment real estate is evaluated using the income method, and its important assumptions are as follows:

Estimated future cash inflows Estimated future cash outflows Estimated future net cash inflows Discount rate	December 31, 2022 $ 1,508,021 ( 156,922) $ 1,351,099 5.1%~7.6%	December 31, 2021
		$ 1,626,365 ( 163,002)
		$ 1,463,363
		5.1%~7.6%%

A. The investment real estate is located in the Jichiang Road, Shipu Town, Kunshan City, Jiangsu Province, China, with a total of 13 ground buildings and land use rights, such as single factory building and duplex factory building. Currently, part of it is leased out as a business lease, and it will be generated in 2022 and 2021. The rental income was NT$49,495 thousand and NT$10,127 thousand respectively.
B. The fair value of the investment real estate is appraised by the Chengzheng Cross-Strait Real Estate Appraiser Firm based on the company's actual rental price using the income method. The Company's actual rental price is within the rental price range of similar comparison targets in the market.
C. The future cash inflow expected from investment real estate includes rental income, deposit interest income and end-of-period disposal value, rental income is estimated based on the Group's current rent and taking into account the annual growth rate of future rent, the benefit analysis period is estimated based on the service life of the land use right of the local government in China, and the deposit interest income is estimated at an interest rate of 1.5% per annum. The expected future cash outflow of investment real estate includes land value tax, house tax, insurance premium, maintenance fee and other expenses. These expenses are estimated based on the current expenditure level and take into account the adjustment of the announced land price in the future and the tax rate stipulated in the house tax regulations.
D. The discount rate is determined by taking into account the People's Bank of China's 2-year time deposit rate of 2.1% and adding 3% to 5.5% of the risk premium related to the investment real estate.
E. Please refer to Note (8) for information on providing guarantee with investment real estate.

15. Other non-current assets

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Items Advance payment for equipment Refundable deposits Collection items Less: Allowance for losses - Collections Long-term prepayments Total	December 31, 2022 $ 26,449 12,517 6,299 ( 6,299) 4,683 $43,649	December 31, 2021
		$ 5,425 11,917 6,299 ( 6,299) 9,488
		$26,830

16. Short-term borrowings

hort-term borrowings
Type of borrowings Mortgage loan Type of borrowings Mortgage loan Loan for purchasing loans Total	December 31, 2022
	Amount Interest rate $ 531,400 1.70%~5.75% December 31, 2021	Interest rate
	Amount $ 442,800 5,260 $448,060	Interest rate
		1.20%~5.75% 1.12%

For short-term loans, the company provides some other financial assets and real estate, plant and equipment as guarantees for loans, please refer to Note (VIII). 17. Allowance for liabilities - Current

Items Employee benefits Items Balance as of January 1 Increased allowance for liabilities for the current period Allowance for liabilities for in the current period Balance as of December 31	December 31, 2022 $ 3,018 2022 Employee benefits $ 2,736 3,018 ( 2,736) $ 3,018	December 31, 2021
		$2,736
		2021
		Employee benefits
		$ 2,414 2,736 ( 2,414)
		$2,736

Allowance for employee benefit liabilities is the valuation of employees' existing short-term leave entitlements.

18. Long-term loans and long-term liabilities due within one year

Loaning institutions	Maturity date	December 31, 2022	December 31, 2021	Repayment method Explanation (1) Explanation (2) Explanation (3) Explanation (4) Explanation (5) Explanation
The Company SUNNY BANK SUNNY BANK SUNNY BANK JihSun Bank Taiwan Business Bank Taiwan Business Bank	2028.06.18 2027.12.30 2024.06.18 2031.01.15 2024.01.06 2024.03.02	$ 597,000 510,000 400,000 745,000 250,000 530,000	$ 600,000 570,000 490,000 755,000 250,000 530,000

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(6)

		(6)
Second-tier subsidiary Sunny Finance Lease Company 2025.09.18 Rural Commercial Bank 2034.07.24 Total Less: Long-term liabilities maturing within one year Long-term borrowings Interest rates	35,360 209,073	37,541Explanation (7) 216,567Explanation (8) 3,449,108 ( 168,819) $ 3,280,289 1.12%～5.75%
	3,276,433 ( 146,723)
	$ 3,129,710
	1.75%～6.86%

(1) The Company borrowed the mid- and long-term loan of NT$600,000 thousand from SUNNY BANK. The repayment method is starting the repayment each month (regarded as one installment) from June 18, 2021 for a consecutive 84 installments, and it repays the interest only for the first to 24th installments, and from the 25th to the 83rd installments repays NT$1,000 thousand in each installment, and the remaining NT$541,000 thousand will be paid off in lump-sum manner in the 84th installment.
(2) The Company borrowed the mid- and long-term loan of NT$600,000 thousand from SUNNY BANK. The repayment method is starting the repayment each month (regarded as one installment) from December 30, 2020 for a consecutive 84 installments. It repays the interest only for the first to 6th installments, and from the 7th to the 83rd installments, repays NT$5,000 thousand in each installment, and the remaining NT$215,000 thousand will be paid off in a lump-sum manner in the 84th installment.
(3) The Company borrowed a mid- and long-term loan of NT$514,000 thousand from the SUNNY BANK. The repayment method is repayment in lump-sum manner on January 6, 2024.
(4) The Company borrowed the mid- and long-term loan of NT$800,000 thousand from JihSun Bank. The repayment method is starting the repayment each three months (regarded as one installment) from January 15, 2022 for a consecutive 36 installments, and it repays the amount of NT$15,000 thousand for each installments, and the remaining principal of NT$275,000 thousand will be paid off in lump-sum manner.
(5) The Company borrowed a mid- and long-term loan of NT$250,000 thousand from the Taiwan Business Bank. The repayment method is repayment in lump-sum manner on January 6, 2024.
(6) The Company borrowed a mid- and long-term loan of NT$530,000 thousand from the Taiwan Business Bank. The repayment method is repayment in lump-sum manner on March 2, 2024.
(7) The Company's sub-subsidiary and Sunny Finance Lease signed an after-sale leaseback contract for machinery and equipment. The lease period is 3 years. After the expiration, the relevant machinery and equipment will still belong to the sun company. The loan amount is RMB 10,000 thousand, and the repayment method is that starting from October 18, 2019, for each month as an installments with a total of 36 installments, and the principal of RMB 50 thousand is repaid in each installment. The remaining RMB 8,250 thousand is paid off in the 36th installment. The sub-subsidiary signed a supplementary contract on September 1, 2022, extending the original financial lease contract for a total of 72 installments, and the remaining RMB6,488 thousand is paid off in the 72nd installment.
(8) The Company's subsidiary borrowed a mid- and long-term loan of RMB 53,293 thousand from the Rural Commercial Bank. The repayment method involves

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starting the repayment on August 20, 2020, with one installment each month for a total of 169 installments. Each installment involves a fixed repayment of principal and interest of RMB 493 thousand.

(9) The Group provides some other financial assets, investment real estate and property, plant and equipment as guarantee for loans, please refer to Note (8) for details.

19. Pension

(1) Defined contribution plan
A. The pension system of the "Labor Pension Act" applicable to the Group is a defined pension contribution plan managed by the government, and 6% of the employee's monthly salary is allocated to the individual account of the Bureau of Labor Insurance. Subsidiaries outside the Republic of China have participated in the definite allocation method handled by the local government, and allocated pensions to the local government on a monthly basis.
B. In 2022 and 2021, the amount that shall be allocated in accordance with the specified proportion in the definite distribution plan has been recognized in the profit and loss statement as a total of NT$3,724 thousand and NT$3,007 thousand, respectively.
(2) Defined-benefits plan
A. The pension system of Taiwan's "Labor Standards Act" applicable to the Group is a defined pension benefit plan managed by the government. The payment of employee pensions is calculated based on the years of service and the average salary of the six months before the approved retirement date. These companies allocate 4% of the total monthly salary of the employees to the employee pension fund, which is deposited in the designated account of the Bank of Taiwan under the name of the Supervisory Committee of Business Entities’ Labor Retirement Reserve. Before the end of the year, if the balance in the estimated special account is insufficient to pay the workers who are expected to meet the retirement conditions in the next year, the difference will be allocated before the end of March of the next year. The designated account is entrusted to the Bureau of Labor Funds of the Ministry of Labor for management, and the Group has no right to instruct the investment management strategy.
B. The amount of the Group's obligations arising from the defined benefit plan included in the parent company only balance sheet is as follows:

Items Defined benefit obligation Fair value of plan assets Net confirmed benefit debt	December 31, 2022 ($ 23,255) 5,999 ($ 17,256)	December 31, 2021
		($ 20,707) 3,999
		($ 16,708)

C. Changes in defined benefit liabilities are presented as follows:

Items		2022
	Present value of defined benefit plan obligations	Fair value of plan assets	Net confirmed benefit debt
Balance as of January 1, 2022 Service costs Current period service costs Interest Expense (Income)	($20,707)	$ 3,999	($16,708)
	( 183) ( 86)	- 11	( 183) ( 75)

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Previous period service costs Liquidation loss (gain) Deferred tax income (expense) recognized in profit or loss Remeasurement number Return on project assets (except for the amount included in net interest) Actuarial (profit) loss- Impact from demographic assumptions Impact from changes in financial assumptions Experience adjustment Deferred tax income (expense) recognized in other comprehensive income Contributions by employer Number of benefit payments on the account Number of benefit payments Balance as of December 31, 2022 Items	- -	- -	- -
	( 269)	11	( 258)
	- - 72 ( 2,351)	327 - - -	327 - 72 ( 2,351)
	( 2,279)	327	( 1,952)
	- - -	1,662 - -	1,662 - -
	($ 23,255)	$ 5,999	($ 17,256)
	Present value of defined benefit plan obligations	Fair value of plan assets	Net confirmed benefit debt
Balance as of January 1, 2021 Service costs Current period service costs Interest Expense (Income) Previous period service costs Liquidation loss (gain) Deferred tax income (expense) recognized in profit or loss Remeasurement number Return on project assets (except for the amount included in net interest) Actuarial (profit) loss- Impact from demographic assumptions Changes in financial assumptions Experience adjustment Deferred tax income (expense) recognized in other comprehensive income Contributions by employer Number of benefit payments on the account Number of benefit payments Balance as of December 31,	($ 20,260)	$ 4,003	($ 16,257)
	( 182) ( 68) - -	- 7 - -	( 182) ( 61) - -
	( 250)	7	( 243)
	- - 70 ( 1,349)	58 - - -	58 - 70 ( 1,349)
	( 1,279)	58	( 1,221)
	- - 1,082	1,013 - ( 1,082)	1,013 - -
	($20,707)	$ 3,999	($16,708)

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2021

D. The Group is exposed to the following risks due to the pension system of the "Labor Standards Act":
(A) Investment risk

The Bureau of Labor Funds of the Ministry of Labor invests labor pension funds in domestic (foreign) equity securities, debt securities, and bank deposits through self-use and entrusted operation methods, however, the distribution amount of the Group's planned assets is not lower than the income calculated from the local bank's 2-year time deposit interest rate.

(B) Interest rate risk

A decrease in interest rates on government bonds will increase the present value of defined benefit obligations, but the return on debt investment in plan assets will also increase. The effects of the two on net defined benefit liabilities will be partially offset.

The calculation of the present value of the defined benefit obligation refers to the future salary of the members of the plan. An increase in the salary of the members of the plan will therefore increase the present value of the defined benefit obligations.

E. The present value of the Group's defined benefit obligations is calculated by a certified actuary. Significant assumptions at the measurement date are listed below:

below:
Items Discount rate Growth of future salary Determining the average due period of benefit obligation	Measurement Date
	December 31, 2022 1.70% 2.00% 11 years	December 31, 2021
		0.48%
		1.00%
		12 years

(A) The assumptions for the future mortality rate are estimated based on the empirical life expectancy table of the Taiwanese life insurance industry in 2021.
(B) If there are reasonably possible changes in major actuarial assumptions, and all other assumptions remain unchanged, the amount that will increase (decrease) the present value of the defined benefit obligation is as follows:

is as follows:
Items Discount rate Increase 0.5% Decrease 0.5% Expected rate of salary increase Increase 0.25% Decrease 0.25%	December 31, 2022 ($ 609) $ 648 $ 313 ($ 305)	December 31, 2021
		($ 578)
		$ 591
		$297
		($289)

Since the actuarial assumptions may be related to each other, the possibility of only a single assumption changing is unlikely, so the above sensitivity analysis may not be able to reflect the actual changes in the present value of the defined benefit obligations.

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  - F. The Group expects to pay NT$1,200 thousand and NT$900 thousand to the pension plan in 2023 and 2022, respectively.

Capital
(1) The adjustments to the number and amount of ordinary shares outstanding at the beginning of the period and at the end of the period are as follows:

2022	2022	2021 Number of shares (thousand) Amount 135,343 $1,353,430 135,343 $1,353,430
Number of shares (thousand)	Amount	Number of shares (thousand)
135,343	$1,353,430	135,343
135,343	$1,353,430	135,343

(2) As of December 31, 2022 and 2021, the Company's authorized capital is NT$3,530,000 thousand which is divided into 353,000 thousand shares. The paid-in capital on December 31, 2022 and 2021 was both NT$1,353,430 thousand, and 135,343 thousand shares were issued.
Capital surplus

apital surplus
Items Changes in recognized ownership interests in subsidiaries	December 31,2022 $ 701	December 31,2021
		$ 701

In accordance with the provisions of the Company Act, the capital surplus from the issuance of shares exceeding the par value and the capital reserve from the receipt of gifts may be used to make up for losses, and when the Company has no accumulated losses, new shares or cash may be issued to shareholders in proportion to their original shares. In addition, in accordance with the relevant provisions of the Securities and Exchange Act, when the above-mentioned capital reserve is allocated to capital, the total amount shall not exceed 10% of the paid-in capital each year. Capital surpluses should not be used to cover accumulated deficit unless the legal reserve is insufficient. The capital surplus generated from investment using the equity method shall not be used for any purpose.

22. Retained earnings

(1) According to the Articles of Incorporation, annual surpluses concluded by the Company are first subject to taxation and making up for previous losses, followed by a 10% provision for legal reserves; however, no further provision is needed when legal reserves have accumulated to the same amount as the Company's paid-in capital. Any surpluses remaining shall then be subject to provision or reversal of special reserves, as the laws. The residual balance (if any) can then be added to undistributed earnings carried from previous years per board resolution, and the shareholder meeting resolved to distribute shareholder bonus shares.
(2) The legal reserve shall not be used except for making up the company's losses and issuing new shares or cash in proportion to the shareholders' original shares. However, the issue of new shares or cash shall be limited to the portion of the reserve exceeding 25% of the paid-in capital.
(3) Special reserve
A. When the Company distributes the surplus, according to laws and regulations, the special reserve shall be withdrawn from the debit balance of other equity items on the balance sheet date of the current year before the distribution. Later when the debit balance of other equity items is reversed, the reversed amount may be included in the distributable surplus.

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B. When adopting IFRSs for the first time, according to official latter Jin Guan Zheng Fa Zi No. 1010012865 dated April 6, 2012, the special reserve of NT$580,567 thousand was provided, if the Company subsequently uses, disposes or reclassifies the relevant assets, the proportion of the original special surplus reserve will be reversed to the distributable retained surplus. In July 2018, the shareholders' meeting resolved to use the special reserve to make up for the loss of NT$580,567 thousand. For any fiscal year with surplus thereafter, before the reason for the allocation of special reserve is eliminated, the shortfall shall be supplemented before the surplus can be distributed.
(4) The Company's profit distribution plan for 2022 and 2021 was proposed by the board of directors in March 2023 and the resolution of the shareholders' meeting was reached in June 2022. There are no distribution matters because there are still losses to be made up in both years.
(5) For information on the profit distribution proposed by the board of directors and resolutions of the shareholders' meeting, please visit the official site of "MOPS" of TWSE.

23. Others

Others
Items	Exchange differences on translation of foreign operations	Unrealized gain or loss on financial assets measured at fair value through other comprehensiveincome	Real estate revaluation appreciation	Total
Balance as of January 1, 2022 Exchange differences arising from the translation of financial statements of foreign operating institutions Share of other comprehensive profit and loss of affiliated enterprises and joint ventures recognized using the equity method Unrealized gains (losses) from investmentsin equity instruments measured at fair value through other comprehensive income Balance as of December 31, 2022	$ 98,839 ( 15,215) - -	$ 86,467 - 37,326 14,583	$ 503,632 - - -	$ 688,938 ( 15,215) 37,326 14,583
	$83,624	$138,376	$503,632	$725,632

Items	Exchange differences on translation of foreign operations	Unrealized gain or loss on financial assets measured at fair value through other comprehensiveincome	Real estate revaluation appreciation	Total
Balance as of January 1, 2021 Exchange differences arising from the translation of financial statements of foreign operating institutions Share of other comprehensive profit and loss of affiliated enterprises and joint ventures recognized using the equity method Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income Balance on 2021.12.31	$ 105,771 ( 6,932) - -	$ 40,378 - 44,113 1,976	$ 503,632 - - -	$ 649,781 ( 6,932) 44,113 1,976
	$98,839	$86,467	$503,632	$688,938

24. Treasury stocks

(1) The situation of the company's repurchase of issued and outstanding shares: None.
(2) The changes in the number of shares of the company held by relevant subsidiaries in the current period are summarized as follows:
2022: None

Name of subsidiaries				20	21
	Number at the beginning of the period		Increas	e this period	Decrease	this period	Number the	at the end of period
	Number of Shares	Amount	Number ofShares	Amount	Number of Shares	Amount	Number ofShares	Amount
GIANTEX TEXTILE CORPORATION	461 thousand shares	$ 9,056	-	$ -	461仟股	$ 9,056	-	$ -

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(3) Subsidiaries holding shares of the Company and enjoying the distribution of dividends, but having no voting rights.
(4) The Group sold 2,800 thousand shares of GIANTEX TEXTILE CORPORATION in November 2021. After the sale, the shareholding was reduced to 46.27%. The Company hence lost control over GIANTEX TEXTILE CORPORATION from that day. In accordance with IAS 32, the application of treasury stocks shall cease.

25. Non-controlling interests

Non-controlling interests
Items Beginning balance Shares attributable to non-controlling interests: Net loss for the year Other comprehensive income for the current year Decrease in non-controlling interests Changes in ownership in subsidiaries Ending balance Operating revenue Items Revenue from customer contracts Sales revenue Logistics revenue Total	2022 ($ 249,895) ( 82,433) ( 12,344) ( 6,450) - ($ 351,122) 2022 $ 257,750 589,750 $ 847,500	2021
		($ 372,254) ( 18,053) ( 5,624) - 146,036
		($ 249,895)
	2022 $ 257,750 589,750 $ 847,500	2021
		$ 443,392 423,425
		$ 866,817

26. Operating revenue

(1) Breakdown of revenue by contract with customers

The Group's income is mainly derived from products and services transferred at a certain point in time, and income can be further divided into the following major products:

major products:
Product type Cotton and Fiber Logistics Others Total (2) Contract balance Contract liabilities - sales of goods	2022 $ 220,046 589,750 37,704 $ 847,500 December 31, 2022 $ 1,818	2021
		$ 324,684 423,425 118,708
		$ 866,817
		December 31, 2021
		$ 3,206

A. Significant changes in contract assets and contract liabilities
Changes in contract liabilities are primarily attributable to differences in the timing of satisfaction of performance obligations and the timing of payment by customers.
B. The contract liabilities at the beginning of the period and the previously satisfied performance obligations recognized as revenue in 2022 and 2021 were NT$3,206 thousand and NT$3,141 thousand, respectively.
C. Unfulfilled customer contracts

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As of December 31, 2022, the Group's unfulfilled customer contracts for the sale of products or services are expected to last for less than one year, and are expected to be performed within the next year and recognized as revenue.

(3) Additional costs for obtaining contracts: None.

(4) The cost of fulfilling the contract: None.

Employee benefits, depreciation, depletion and amortization expenses

Type		2022
	Operating costs	Operating expenses
Employee benefits expense Payroll expenses Labor and health insurance Pension Other employee benefits expense Depreciation Amortization expenses Total Type	$ 65,426 5,544 2,497 2,841 85,670 9,434	$ 36,893 2,518 1,485 2,608 2,818 24
	$ 171,412	$ 46,346
		2021
	Operating costs	Operating expenses
Employee benefits expense Payroll expenses Labor and health insurance Pension Other employee benefits expense Depreciation Amortization expenses Total	$ 52,275 4,241 1,961 2,113 66,148 7,210	$ 33,695 2,136 1,289 3,238 2,814 24
	$133,948	$43,196

(1) According to the Company's Articles of Association, if there is any profit in the year, no less than 3% of such profit shall be allocated as employee remuneration, and the board of directors will determine to distribute it in the form of stock or cash, and those qualified for receiving the distribution include employees of affiliated enterprises who meet certain conditions; based on the above-mentioned profit amount, the Company may allocate no more than 3% as remuneration for directors and supervisors by resolution of the board of directors. Proposals on the distribution of employee remuneration and director/supervisor remuneration shall be reported to the shareholders' meeting. However, if the Company still has accumulated losses, it shall reserve the compensation amount in advance, and then allocate employee remuneration and director/supervisor remuneration in proportion based on the preceding Paragraph.
(2) In 2022 and 2021, there were losses yet to be made up, and there was no payment plan for employee remuneration and director and supervisor remuneration. Therefore, it is estimated that both employee remuneration and director and

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supervisor remuneration are NT$0. If there is any discrepancy between the actual distribution amount and the estimated amount as determined by the board of directors, it will be regarded as a change in accounting estimate and listed as profit or loss for the next year.

(3) In March 2022 and 2021, the board of directors resolved to distribute NT$0 for employee remuneration and director and supervisor remuneration for 2022 and 2021, which is no different from the employee remuneration and director and supervisor remuneration recognized in the financial reports.
(4) For information about the Company's employee remuneration and director and supervisor remuneration, please visit the official site of MOPS of TWSE.

28. Others

thers
Items	2022			2021
Dividend income	$	1,534		$	1,697
Rental income		12			14
Others		3,666			3,725
Total	$	5,212		$	5,436
ther gains and losses
Items		2022		2021
Financial asset measured at fair value through profit or loss		($	114)	($	1,839)
and net loss on liabilities
Net foreign exchange gains			14,942		15,508
Loss of investments disposed of		(	1,228)	(	2,034)
Gain on disposal of property, plant and equipment			-		1,205
Loss of investment real estate adjusted by fair value		( 38,054)		(	46,272)
Others		(	1,496)	(	2,376)
Total		($25,950)		($	35,808)

29. Other gains and losses

30. Finance costs

inance costs
Items Interest expense: Bank loan Interest on lease liabilities Others Less: The capitalized amount of assets meeting the requirements Finance costs ncome tax (1) Components of income tax expense: Items Current income tax Income tax incurred in the current period Surtax on unappropriated retained earnings The amount of tax payable under the	2022 $ 96,797 61 122 ( 2,593) $ 94,387 2022	2021 $ 93,599 41 162 ( 4,146) $ 89,656 2021


		$ 8,938 118 -

31. Income tax

(1) Components of income tax expense:

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minimum taxation system Income tax adjustments of previous year Current income tax, total Deferred tax Origin and reversal of temporary differences Income tax (expense) benefit	- 3,182 270 $ 3,452	- 9,056 ( 1,188) $ 7,868

(2) The tax amount calculated by multiplying the income tax expense and the pre-tax net profit by the statutory tax rate is adjusted as follows:

Items Income before income tax Net profit (loss) before tax is calculated according to the statutory tax rate Tax impact of adjustment: Amounts impacted by items that are not included in the calculation of taxable income Surtax on unappropriated retained earnings The amount of tax payable under the minimum taxation system Income tax payable for the current year Income tax adjustments of previous year Net change in deferred tax Expense of tax recognized in profit	2022 $146,465 ($ 612) 2,829 965 - 3,182 - 270 $3,452	2021
		$212,002
		$ 34,944 ( 26,006) 118 -
		9,056 - ( 1,188)
		$7,868

The tax rate applicable to the Group's entities subject to the Income Tax Law of the Republic of China is 20%, and the tax rate applicable to undistributed earnings is 5%.

(3) Deferred income tax assets (liabilities):

Items		2022	2022
	Beginning balance	Recognized in (losses) gains		Ending balance
Deferred tax assets: Temporary difference Unrealized loss on inventory price falling Deferred tax liabilities: Temporary difference Unrealized exchange gains Land value increment tax Subtotal Total Items	$ 3,250	($ 270)		$ 2,980
	- ( 370,231)	- -		- ( 370,231)
	( 370,231)	-		( 370,231)
	($366,981)	($270)		($367,251)

	Beginning balance	Recognized in (losses) gains	Recognized in other comprehensive (losses) gains $ - - - - $-	Ending balance
Deferred tax assets: Temporary difference Unrealized loss on inventory price falling Deferred tax liabilities: Temporary difference Unrealized exchange gains Land value increment tax Subtotal Total	$ 2,912	$ 338		$ 3,250
	( 850) ( 370,231)	850 -		- ( 370,231)
	( 371,081)	850		( 370,231)
	($368,169)	$1,188		($366,981)

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(4) Items not recognized as deferred income tax assets

Items Temporary differences which may be deducted Loss deduction Total	December 31, 2022 $ - 37,324 $ 37,324	December 31, 2021
		$ 13,507 78,829
		$ 92,336

(5) The Company's profit-seeking income tax has been approved by the tax collection unit until 2020.

Other comprehensive income

unit until 2020. 32. Other comprehensive income	unit until 2020. Other comprehensive income
2022 Items Pre-tax amountIncome tax (expense) benefit Not to be reclassified to profit or loss in subsequent periods: Re-measurement of defined benefit plans ($ 1,952) $ - Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income 14,583 - Other comprehensive profit and loss shares of subsidiaries, affiliated enterprises and joint ventures recognized using the equity method 37,326 - Subtotal 49,957 - To be reclassified to profit or loss in subsequent periods: Exchange differences on translation of foreign operations ( 27,559) - Deferred tax income (expense) recognized in other comprehensive income $ 22,398 $ - 2021 Items Pre-tax amountIncome tax (expense) benefit Not to be reclassified to profit or loss in subsequent periods: Re-measurement of defined benefit plans ($ 1,221) $ - Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income 1,976 - Other comprehensive profit and loss shares of subsidiaries, affiliated enterprises and joint ventures recognized using the equity method 44,113 - Subtotal 44,868 - To be reclassified to profit or loss in subsequent periods: Exchange differences on translation of foreign operations ( 12,556) - Deferred tax income (expense) recognized in other comprehensive income $ 32,312 $ - 33. Basic earnings per share 2022 Net profit for the period attributable to the continuing business unit of the parent company $ 225,446 After-tax loss of closed units $- Weighted average number of shares outstanding in the current period (1,000 shares) 135,343 Net profit attributable to the continuing business unit of the parent company $ 1.67 Net profit or loss from discontinued -	Items			2022
		Pre-tax amount		Income tax (expense) benefit	Net income after tax
	Not to be reclassified to profit or loss in subsequent periods: Re-measurement of defined benefit plans Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income Other comprehensive profit and loss shares of subsidiaries, affiliated enterprises and joint ventures recognized using the equity method Subtotal To be reclassified to profit or loss in subsequent periods: Exchange differences on translation of foreign operations Deferred tax income (expense) recognized in other comprehensive income Items	($ 1,952) 14,583 37,326		$ - - -	($ 1,952) 14,583 37,326
		49,957		-	49,957
		( 27,559)		-	( 27,559)
		$ 22,398		$ -	$ 22,398
				2021
		Pre-tax amount		Income tax (expense) benefit	Net income after tax
			($ 1,221) 1,976 44,113	$ - - -	($ 1,221) 1,976 44,113
			44,868	-	44,868
			( 12,556)	-	( 12,556)
			$ 32,312	$ -	$ 32,312
					2021 $ 224,808 ($2,621) 134,922 $ 1.67 ( 0.02)

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operation Basic earnings per share (after tax) (NT$) $ 1.67 $ 1.65

Disposal of subsidiary
(1) On November 30, 2021, the company sold 2,800 thousand shares of GIANTEX TEXTILE CORPORATION, a subsidiary of the Company, and its shareholding in GIANTEX TEXTILE CORPORATION dropped to 46.27%, and lost control of the subsidiary from that date.

A. On the date of loss of control, analysis of assets and liabilities of loss of control:

control:
Items	November 30, 2021
Current assets
Cash and cash equivalents	$ 198
Financial assets measured at fair value through other comprehensive income	7,761
Other receivables	132,002
Non-current assets
Investment accounted for under the equity method	38
Current liabilities
Payables	( 6,400)
Other payables	( 117,632)
Non-current liabilities
Others	( 850)
Net assets disposed of	$15,117

B. Cash flow of disposal of subsidiaries:

ash flow of disposal of subsidiaries:
Items	November 30, 2021
Disposal of cash and equivalent cash balance	$ 198
Add: Non-controlling interest on disposal date	146,036
Less: Cash from the beginning of the period to the date	( 154,327)
of disposal, non-controlling interests and the
amount affected by merger write-off
Net cash outflow of disposal of subsidiaries	($ 8,093)

(2) LILYTEX INTERNATIONAL CORP. was dissolved by the shareholder meeting on October 1, 2021. The base date for dissolution was October 1, 2021. The liquidation was completed on June 13, 2022. The Group has lost control of the subsidiary.
A. On the date of loss of control, analysis of assets and liabilities of loss of control:

control:
Items Current assets Cash and cash equivalents Non-current liabilities Other payables Net assets disposed of	October 1, 2021
	$ 16 ( 5)
	$ 11

B. Net cash flow of disposal of subsidiaries:

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Items	October 1, 2021
Disposal of cash and equivalent cash balance	$ 16
Add: Non-controlling interest on disposal date		-
Less: Cash from the beginning of the period to the date	( 16)
of disposal, non-controlling interests and the
amount affected by merger write-off
Net cash outflow of disposal of subsidiaries	$	-

35. Reconciliation for liabilities arising from financing activities

January 1, 2022	Cash flow		No	n-cash Changes			December 31, 2022
		Changes in acquisition of subsidiary	Change in loss of control of a subsidiary	Changes in exchange rates	Changes of fair value $ - - - - - $ -	Other non-cash changes
$ 448,060 513,025 3,449,108 1,197 51,807	$ 83,340 50,936 ( 172,675) ( 2,696) 15,159	$ - - - - -	$ - - - - -	$ - - - - -		$ - - - 9,442 -	$ 531,400 563,961 3,276,433 7,943 66,966
$ 4,463,197	($ 25,936)	$ -	$ -	$ -		$ 9,442	$ 4,446,703
January 1, 2021	Cash flow		No	n-cashChanges			December 31, 2021
		Changes in acquisition of subsidiary	Change in loss of control of a subsidiary	Changes in exchange rates	Changes of fair value $ - - - - - $ -	Other non-cash changes
$ 2,858,981 476,079 864,787 4,362 26,436	($ 2,410,921) 36,946 2,584,321 ( 3,165) 25,371	$ - - - - -	$ - - - - -	$ - - - - -		$ - - - - -	$ 448,060 513,025 3,449,108 1,197 51,807
$ 4,230,645	$ 232,552	$ -	$ -	$ -		$ -	$ 4,463,197

(VII) Related-Party Transactions

1. Parent company and ultimate controller

The Company is the ultimate controller of the Company and its subsidiaries.

2. Name and nature of relationship of the related parties

Name of the related parties Relationship with the Company

SUNNY LOGISTICS CO., LTD. Associates LILY CONSTRUCTION CO., LTD. Associates STAR PACIFIC SERVICES CORP. Other related party GREEN DEFENSE CO., LTD. Other related party SHING SHOUN FIBER CO., LTD. Other related party Kunshan Lily Garment Co., Ltd. Other related party Lily Freight Co., Ltd. (Note) Other related party Kunshan Lily Enterprise Management Other related party Consulting Co., Ltd. Su, Tung-Rong Major Management Level106 Su, Chin-Yuan Major Management Level106 Su, Jin-Shu Other related party Su Liao, Hsiu-Chin Other related party Note: The original name was Lily Logistics Development Co., Ltd., and it was renamed in November 2021.

3. Significant transactions with the related parties

The balance and transactions between the Group and its subsidiaries (related persons of the Company) have been eliminated in the preparation of the consolidated financial statements and have not been disclosed. The details of transactions between the Group and other related parties are disclosed as follows:

(1) Costs

Accounting Type of related 2022 2021 item parties

- 106 -

Import Other related party Warehousing costs Other related party	$ 9 $ 1,066	$241 $ 998

The transaction conditions for the purchase of goods with the above-mentioned related parties are 30 to 60 days, and the calculation of the price is the same as that of ordinary non-related parties.

(2) Revenue

Accounting item Sales revenue Logistics revenue	Type/Name of related parties Other related party Other related party	2022 $25,190 $ 13,993

The transaction conditions for the sales of goods with the above-mentioned related parties are 60 to 75 days, and the calculation of the price is the same as that of ordinary non-related parties.

(3) Property transactions: None.

(4) Various fees

roperty transactions: None. arious fees
Type/Name of related parties 2022 2021 Associates $ 600 $ arious income Type/Name of related parties 2022 2021 Associates $11 $ losing balance of accounts receivable (payable) Type/Name of related parties December 31, 2022 Notes receivable and accounts Other related party $ 27,826 Less: loss allowance - Net amount $27,826	2021	Type of transaction 600 Rent costs Type of transaction 14 Rental income December 31, 2021
	$
	2021
	$
		$ 17,139 ( 1,812)
		$15,327

(5) Various income

(6) Closing balance of accounts receivable (payable)

In 2022 and 2021, the impairment and recovery benefits of the above-mentioned receivables from related parties amounted to NT$1,812 thousand and NT$265 thousand, respectively.

Type/Name of related parties	December 31, 2022	December 31, 2021
Other accounts receivable Key management level of the entity or its parent company Other related party Total Less: loss allowance Net amount	$ 4,858 1,039	$ 4,757 696
	5,897 -	5,453 -
	$ 5,897	$ 5,453

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In 2022 and 2021, no allowance was made for the above-mentioned receivables from related parties.

Type/Name of related parties Notes payable and accounts Associates Other related party Total	December 31, 2022 $ 2,250 161 $2,411	December 31, 2021 $ 2,210 48 $2,258

(7) Financing

A. Lend:

A. Ending balance

ding balance
Accounting item	Type/Name of related parties	December 31, 2022		December 31, 2021
Other receivables	Other related party		$ -	$	10,000
terest receivable
Accounting item	Type/Name of related parties	December 31, 2022		December	31, 2021
Other receivables	Other related party		$ -		$ 6
terest income
Type/Name of related parties		2022		2021
Other related	party	$	61	$	206
Interest rates		2%		2%
The loans to	related parties on	December	31, 2022	and 2021 were all
unsecured loans.

(B) Interest receivable

(C) Interest income

B. Borrowed:

(A) Amount payable to related parties

Type/Name of related parties Associates LILY CONSTRUCTION CO., LTD. STAR PACIFIC Other related party Su, Jin-Shu and Su Liao, Hsiu-Chin, etc. Su, Tung-Rong and Su, Chin-Yuan, etc. Total	December 31, 2022 $ 20,481 10 146,536 38,076 - 357,368 $ 562,471	December 31, 2021 $ 20,110 6 132,040 31,644 - 328,207 $ 512,007

(B) Interest payable

Type/Name of related December 31, 2022 December 31, 2021 parties Associates $ 1,490 $ 1,018

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(8) Guarantee notes

(8) Guarantee notes
Type/Name of related parties Key management level of the entity or its parent company 4. Salary information of major management Type/Name of related parties Salary and other short-term employee benefits Post-employment benefits Total	December 31, 2022 $ 19,506 level 2022 $ 11,563 - $11,563	December 31, 2021
		$ 19,506
	level 2022 $ 11,563 - $11,563	2021
		$ 10,379 -
		$10,379

(VIII) Pledged Assets

The following assets have been provided as collateral for various borrowings and performance bonds:

performance bonds:
Items Other financial assets - Current Property, plant and equipment (Net) Investment property Total	December 31, 2022 $ 186,544 3,635,892 906,251 $ 4,728,687	December 31, 2021
		$ 180,997 3,313,350 926,061
		$ 4,420,408

(IX) Material Contingent Liabilities and Unrecognized Contractual Commitments
Endorsement and guarantee
- (1) As of December 31, 2022 and 2021, the Group's endorsement guarantee for Kunshan Lily Textile Co., Ltd. provides guarantee for bank loans with an amount of RMB41,000 thousand.
- (2) As of December 31, 2022 and 2021, the Group's endorsement guarantee for LILY CONSTRUCTION CO., LTD. provides guarantee for bank loans with an amount of RMB15,000 thousand.
As of December 31, 2022 and 2021, the guarantee notes received by the Group for the purpose of endorsement of performance of construction and guarantee of creditor's rights, etc. reached NT$69,758 thousand in total, and are recorded in the accounts of guarantee notes and guarantee notes receivable (memo).
The details of the Group's unused letters of credit are as follows:

==> picture [393 x 29] intentionally omitted <==

Kunshan Kunlong Computer Industry Co., Ltd., the investment real estate lessee of the subsidiary Kunshan Lily Textile Co., Ltd., owed a rent of RMB 7,378 thousand due to a dispute of fire incurred by the sub-lessor in July 2019. Kunshan Lily Textile Co., Ltd. in December 2019 appointed a lawyer to terminate the lease contract of the factory buildings and collect the money owed. The Kunshan City People's Court reached a judgement of the first instance which favored the Kunshan Lily Textile Co., Ltd. in October 2020, and the whole litigation ended on September 30, 2021, in which the final judgement favored Kunshan Lily Textile Co., Ltd. Hence, Kunshan Kunlong Company was required to pay a total of RMB 6,263 thousand in arrears of rent to Kunshan Liyi, and the person in-charge of Kunshan Kunlong Company shall be jointly and severally responsible for such payment. Kunshan Lily Company recognized other losses as a result of the difference between the account receivable balance of RMB 6,580 thousand and the recoverable amount determined by the court of RMB 317 thousand.

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  5. Kunshan Kangwei PMMA Products Co., Ltd., the lessee of the investment real estate of the subsidiary Kunshan Lily Textile Co., Ltd., the sub-lessee of Kunshan Kunlong Computer Industry Co., Ltd. filed a lawsuit in June 2020 due to a disputed of fire incurred in July 2019 to claim joint compensation of RMB 14,630 thousand for property losses from Kunshan Kunlong Company and Kunshan Lily. The litigation ended on October 21, 2021, and the final judgment indicated that Kunshan Kangwei Company withdrew the appeal, and the first-instance judgment was sustained and the whole case was closed.

(X) Losses due to Major Disasters: None.
(XI) Significant Subsequent Events: None.
(XII) Others
1. Capital risk management
  - The Company needs to maintain a large amount of capital to meet the needs of expansion and upgrading of plant and equipment. Therefore, the Company's capital management is to ensure that it has the necessary financial resources and operating plans to meet the needs of working capital, capital expenditures, research and development expenses, debt repayments and dividend payments in the next 12 months.
2. Financial instruments
  - (1) Financial risk of financial instruments
    - A. Financial risk management policies

The daily operation of the Group is affected by various financial risks, including market risk (including exchange rate risk, interest rate risk, and price risk), credit risk and liquidity risk. In order to reduce related financial risks, the company is committed to identifying, assessing and avoiding market uncertainties, so as to reduce the potential adverse impact of market changes on the company's financial performance.

The Company's important financial activities are reviewed by the board of directors in accordance with relevant regulations and internal control systems. During the execution of the financial plan, the company must strictly abide by the relevant financial operating procedures regarding overall financial risk management and division of powers and responsibilities.

B. Nature and extent of material financial risks
(A) Market risk
- a. Foreign exchange risk
  - (a) The Group is exposed to exchange rate risk arising from sales, purchases and borrowing transactions and net investments in foreign operations that are not denominated in the respective functional currencies of the Group. These transactions are mainly denominated in US dollars and RMB. In order to avoid the decrease in the value of foreign currency assets and the fluctuation of future cash flow due to exchange rate changes, the Company uses foreign currency loans and derivative financial instruments (including forward exchange contracts and exchange interest contracts) to avoid exchange rate risks. The use of such derivative financial instruments can help the Company reduce but still cannot completely eliminate the impact of foreign currency exchange rate changes.

Since the net investment of foreign operating institutions is a strategic investment, the company does not hedge against it.

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(b) Exchange rate exposure risk and sensitivity analysis

December 31, 2022

		December31,2022	2
Financialassets Monetary items USD : NTD CNY : NTD EUR : NTD CHF : NTD Financial liabilities Monetary items USD : NTD EUR : NTD Financial assets Monetaryitems USD : NTD CNY : NTD EUR : NTD CHF : NTD Financial liabilities Monetary items USD : NTD EUR : NTD	Foreign currency $ 16,675 41,414 439 266 14,351 88	Exchange rate NT$ 30.73 $ 512,423 4.42 183,050 32.80 14,399 33.23 8,839 30.73 441,006 32.80 2,886 December 31, 2021	NT$
	Foreign currency $ 56,261 41,000 439 266 22,169 88	Exchange rate 27.69 4.34 31.29 30.18 27.69 31.29	NT$
			$ 1,557,867 177,940 13,736 8,028 613,860 2,754

The sensitivity analysis of the company's exchange rate risk mainly focuses on the major foreign currency monetary items and non-monetary items on the end date of the financial reporting period, and the impact of the related foreign currency appreciation/depreciation on the Group's profit and loss and equity. The Company's exchange rate risk is mainly affected by the fluctuation of the US dollar exchange rate. When the US dollar depreciates/appreciates 1%, the company's net profit after tax in 2022 and 2021 will increase/decrease by NT$571 thousand and NT$7,552 thousand, respectively

(c) The Group's monetary items have no unrealized exchange gains or losses that have a significant impact due to exchange rate fluctuations.

b. Price risk

Since the Group holds investments in equity instruments, the Group is exposed to the price risk of equity instruments, because the equity instruments held by the Group are invested in the consolidated balance sheet, they are classified as financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive profit or loss.

The Group mainly invests in domestic listed/OTC and non-listed/OTC equity instruments. The price of these equity instruments will be affected by the certainty of the future value of the investment target.

If the price of an equity instrument rises or falls by 1%, other comprehensive profit and loss after tax in 2022 and 2021 will increase (decrease) by NT$1,591 thousand and NT$1,315 thousand, respectively due to the increase or decrease in the fair value of financial assets measured at fair value through other comprehensive profit and loss c. Interest rate risk

(a) The Group's interest rates on interest-bearing financial instruments on the reporting date are summarized as follows:

Carrying amount Items December 31, 2022 December 31, 2021

- 111 -

Instrument with fair value interest rate risk: Financial assets Financial liabilities Net amount Instrument with cash flow interest rate risk: Financial assets Financial liabilities Net amount	$ 181,533 - $181,533 $ 45,923 ( 3,807,833) ($3,761,910)	$ 178,253 - $178,253 $ 102,202 ( 3,897,168) ($3,794,966)

(a) Sensitivity analysis of fair value interest rate risk:

The Group does not classify any fixed-rate financial assets and liabilities as financial assets measured at fair value through profit or loss and available for sale, nor does it designate derivatives (interest rate swaps) as hedging tools under the fair value hedging accounting model. Therefore, changes in interest rates on the reporting date will not affect profit or loss, equity, and other comprehensive net income.

(b) Sensitivity analysis of instruments with cash flow interest rate risk The Group's financial instruments with variable interest rates are assets (debts) with floating interest rates. Therefore, changes in market interest rates will cause changes in effective interest rates, resulting in fluctuations in future cash flows. Every 1% increase in the market interest rate will reduce the after-tax net profit in 2022 and 2021 by NT$30,095 thousand and NT$30,360 thousand, respectively

(B) Credit risk

Credit risk refers to the risk that the counterparty of the transaction violates the contractual obligations and causes financial losses to the Group. The Group's credit risk mainly comes from receivables generated from operating activities, bank deposits and other financial instruments generated from investment activities. Operational credit risk and financial credit risk are managed separately.

a. Operation-related credit risk

In order to maintain the quality of accounts receivable, the company has established procedures for credit risk management related to operations. The risk assessment of an individual customer is based on the consideration of various factors that may affect the customer's ability to pay, including the customer's financial status, the company's internal credit rating, historical transaction records and current economic conditions.

b. Financial credit risk

The credit risk of bank deposits and other financial instruments is measured and monitored by the financial segment of the Group. Since the Group's transaction partners and other parties to the contract are all credit-worthy banks, financial institutions, corporate organizations, and government agencies with investment grades and above, there are no major doubts about the performance of the contract, so there is no major credit risk. In addition, the Group is not classified as an investment in debt instruments measured at fair value through other comprehensive profit or loss at cost after amortization.

(a) Credit concentration risk

As of December 31, 2022 and 2021, the accounts receivable balance of the top ten customers accounted for 23.02% and 48.54% of the Company's accounts receivable balance, respectively, and the

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credit concentration risk of the remaining accounts receivable was relatively insignificant.

(b) Measurement of expected credit impairment losses

Accounts receivable: simplified approach, please refer to Note (6)5. Basis for judging whether the credit risk has increased significantly: None. (In addition, the Group is not classified as an investment in debt instruments measured at fair value through other comprehensive profit or loss at cost after amortization)

(c) The financial assets held by the Group do not have any collateral or other credit enhancement protection to avoid the credit risk of financial assets.

C. Liquidity risk

a. Management of liquidity risk

The goal of the Group's liquidity risk management is to maintain the cash and equivalent cash required for operations, highly liquid securities and sufficient bank financing lines, etc., so as to ensure that the Group has sufficient financial flexibility.

b. Maturity analysis of financial liabilities

The following table summarizes the analysis of the Group's financial liabilities during the agreed repayment period according to the due date and undiscounted due amount:

Non-derivative financial instruments				December31,20	22
	Within 6 months	6 to 12 months	1-2 years	2-5 years	More than 5 years $ - - - - 1,103,112 58,054 $1,161,166	Contract cash flow	Carrying amount
Short-term borrowings Notes payable (including related parties) Accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including due in one year) Guarantee deposits Total	$ - 15,870 69,819 803,038 73,147 -	$ 531,400 - - - 73,576 -	$ - - - - 1,372,160 8,912	$ - - - - 654,438 -		$ 552,406 15,870 69,819 803,038 3,443,964 66,966	$ 531,400 15,870 69,819 803,038 3,276,433 66,966
	$961,874	$604,976	$1,381,072	$654,438		$4,952,063	$4,763,526

Derivative financial liabilities: None.

Further information on the lease liability maturity analysis is as follows:

Lease liabilities	Less than 1 year	1-5 years	5-10 years	15-20 years	Over 20 years	Total undiscounted lease payments $8,082	Carrying amount
	$3,213	$4,869	$-	$-	$-		$7,943

Non-derivative financial instruments				December31,20	21
	Within 6 months	6 to 12 months	1-2 years	2-5 years	More than 5 years $ - - - - 1,358,860 43,057 $1,401,917	Contract cash flow	Carrying amount
Short-term borrowings Notes payable (including related parties) Accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including due in one year) Guarantee deposits Total	$ 44,260 15,542 126,559 724,708 66,845 -	$ 403,800 - - - 101,974 -	$ - - - - 210,985 8,750	$ - - - - 1,710,444 -		$ 467,032 15,542 126,559 724,708 4,385,173 51,807	$ 448,060 15,542 126,559 724,708 3,449,108 51,807
	$977,914	$505,774	$219,735	$1,710,444		$5,770,821	$4,815,784

Derivative financial liabilities: None.

Further information on the lease liability maturity analysis is as follows:

Lease liabilities	Less than 1 year	1-5 years	5-10 years	15-20 years	Over 20 years	Total undiscounted lease payments $1,200	Carrying amount
	$1,200	$-	$-	$-	$-		$1,197

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The Group does not expect that the cash flow of maturity analysis will be significantly earlier, or the actual amount will be significantly different.

(2) Types of financial instruments

The book values of various financial assets and financial liabilities of the Group on December 31, 2022 and 2021 are as follows:

Financial assets	December 31, 2022	December 31, 2021 $ 171,216 234,126 54,423 180,997 11,917 6,217 131,539 448,060 142,101 724,708 3,449,108 51,807
Financial assets measured at amortized cost Cash and cash equivalents Notes receivable and accounts (including related parties) Other accounts receivable - Related parties Other financial assets - Current Refundable deposits Financial assets at fair value through profit or loss - Current Unrealized gains and losses on equity investments measured at fair value through other comprehensive income Financial assets at fair Financial liabilities	$ 132,941 169,403 33,499 186,544 12,517 4,763 159,070 531,400 85,689 803,038 3,276,433 66,966
Financial liabilities at amortized cost Short-term borrowings Notes and accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including due in one year) Guarantee deposits

3. Information of changes of fair value

(1) Please refer to Note (12)3(4) for the fair value information of the Group's financial assets and financial liabilities that are not measured at fair value.

(2) Three-level definition of fair value:

Level 1:

The input value of this level refers to the open quotation of the same instrument in the active market of the instrument in the active market. An active market refers to a market that meets all of the following conditions: Commodities traded in the market are homogeneous; willing buyers and sellers can be found in the market at any time and price information is available to the public. Level 2:

The input values of this level include observable input values obtained directly (such as prices) or indirectly (such as deriving from prices) from active markets, other than publicly quoted prices in active markets. Level 3:

The input value of this level refers to the input parameter to measure the fair value which is not based on the observable input value available in the market.

(3) Financial instruments not measured at fair value

The Group's financial instruments that are not measured at fair value include cash and

cash equivalents, notes receivable, accounts receivable, other receivables, other

- 114 -

financial assets, deposits, short-term loans, notes payable, accounts payable, other carrying amounts of payables and deposits are reasonable approximations of fair values.

(4) Information of level of fair value:

The Group's financial instruments and investment real estate measured at fair value are measured at fair value on a repeatable basis, while assets to be disposed are measured at the lower of book value and fair value less costs to sell on a non-repetitive basis. The Group's fair value grade information is shown in the table below:

Items		December31,2022	December31,2022
	Level 1	Level 2	Level3	Total
Recurring fair value Financial asset measured at fair value through profit or loss Financial assets measured at fair value through other comprehensive income Investment property Total Items	$ 4,763 18,557 -	$ - - -	$ - 140,513 906,251	$ 4,763 159,070 906,251
	$23,320	$-	$1,046,764	$1,070,084
		December31,2021
	Level 1	Level 2	Level3	Total
Recurring fair value Financial asset measured at fair value through profit or loss Financial assets measured at fair value through other comprehensive income Investment property Total	$ 6,217 18,806 -	$ - - -	$ - 112,733 926,061	$ 6,217 131,539 926,061
	$25,023	$-	$1,038,794	$1,063,817

(5) Fair value evaluation techniques for instruments measured by fair value:
A. If there is a public quotation in an active market for a financial instrument, the public quotation in the active market shall be used as the fair value. The market prices announced by major exchanges and central government bond over-the-counter trading centers that are judged to be popular bonds are the basis for the fair value of listed (OTC) equity instruments and debt instruments with open quotations in active markets.

If public quotations of financial instruments can be obtained timely and frequently from exchanges, brokers, underwriters, industry associations, pricing service agencies or competent authorities, and if the price represents an actual and frequently occurring fair market transaction, the financial instrument will be deemed to have an open quotation in an active market. If the above conditions are not met, the market is considered inactive. Generally speaking, a large bid-ask spread, a significant increase in the bid-ask spread, or very little trading volume are indicators of an inactive market.

If the financial instruments held by the Group have an active market, their fair values are listed as follows by category and attribute:

(A) Stocks of listed/OTC companies: closing price.
(B) Open-ended funds: net worth.
B. Except for the above-mentioned financial instruments with active markets, the fair value of other financial instruments is obtained by evaluation techniques or by referring to the quotations of counterparties. The fair value obtained through evaluation techniques can refer to the current fair value of other financial instruments with substantially similar conditions and characteristics, discounted cash flow method or other evaluation techniques, including the use of market information available on the consolidated balance sheet date. Calculated (for example, refer to the yield curve of the counter buying center, the average quotation of Reuters commercial paper interest rate).

The fair value of non-listed/OTC company stocks held by the Group without an active market is mainly estimated by the market method, and its judgment is based on evaluations of similar companies, third-party quotations, company net worth and operating conditions. In addition, its significant unobservable input value is mainly liquidity discount, but because possible changes in liquidity discount will not cause significant potential financial impact, it is not intended to disclose its quantitative information.

- 115 -

C. The evaluation of derivative financial instruments is based on evaluation models widely accepted by market users, such as discount method and option pricing model. Forward foreign exchange contracts are usually evaluated based on the current forward exchange rate.
D. The fair value of non-listed/OTC company stocks held by the Group without an active market is mainly estimated by the market method, and its judgment is based on evaluations of similar companies, third-party quotations, company net worth and operating conditions.
(6) Transfer between Level 1 and Level 2: None.
(7) The detailed list of changes in the Level 3 (excluding non-repetitive fair value):

Items January 1, 2022 Gains or losses recognized in profit or loss for the period Gain or loss recognized in other comprehensive profit or loss Transferred in this period Acquisition this period Disposal this period Transferred to Level 3 Transferred from Level 3 December 31, 2022 Items January 1, 2021 Gains or losses recognized in profit or loss for the period Gain or loss recognized in other comprehensive profit or loss Transferred in this period Acquisition this period Disposal this period Transferred to Level 3 Transferred from Level 3 December 31, 2021	Equity securities $ 112,733 - 14,832 - 12,948 - - - $ 140,513 Equity securities $ 106,350 - 2,346 - 4,037 - - - $112,733	Investment property
		$ 926,061 ( 38,054) 16,736 - 1,508 - - -
		$ 906,251
		Investment property
		$ 961,385 ( 46,272) 8,738 - 2,210 - - -
		$ 926,061

(8) Quantitative information on fair value measurement of significant unobservable inputs (Level 3):

Non-derivative financial assets Non-listed/OTC stocks Non-financial assets Investment property Non-derivative financial assets Non-listed/OTC stocks Non-financial assets Investment property	Fair value on December 31, 2022	Evaluation technique	Significant unobservable input value Lack of market liquidity discount Estimated future cash flow discount rate Significant unobservable input value Lack of market liquidity discount Estimated future cash flow discount rate	Interval (weighted average)	Relation between input value and fair value
	$ 140,513 906,251 Fair value on December 31, 2021	Market method Income method Evaluation technique		25% 5.1%~7.6% Interval (weighted average)	The higher the discount due to lack of market liquidity, the lower the fair value The higher the discount rate, the lower the fair value Relation between input value and fair value
	$ 122,733 926,061	Market method Income method		25% 5.1%~7.6%	The higher the discount due to lack of market liquidity, the lower the fair value The higher the discount rate, the lower the fair value

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(9) The evaluation process of the fair value is classified into Level 3:
The Group's evaluation process for classifying the fair value into Level 3 is that the financing and accounting segment is responsible for verifying the fair value of financial instruments, using independent source data to make the evaluation results close to the market status, confirming that the data source is independent, reliable, and other data sources Consistent and representative executable prices, and regularly calibrate the evaluation model, conduct backtesting, update the input values and data required for the evaluation model, and make any other necessary fair value adjustments to ensure that the evaluation results are reasonable.

In addition, the Group's fair value is classified as investment real estate of Level 3. The determination of its fair value is in accordance with the provisions of the International Financial Reporting Standards, and a professional appraisal agency is appointed to evaluate the value based on the support of market evidence.

(10) Sensitivity analysis of fair value measurement of Level 3 and fair value to reasonable and possible alternative assumptions:

Input value	Change	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022
		Deferred tax income (expense) recognized in profit or loss		Deferred tax income (expense) recognized in other comprehensive income
		Favorable change	Unfavorable change	Favorable change	Unfavorable change
Current discount Input value	±1% Change	$ -	$ -	$ 1,871	($ 1,870)

		Deferred tax income (expense) recognized in profit or loss		Deferred tax income (expense) recognized in other comprehensive income
		Favorable change	Unfavorable change	Favorable change	Unfavorable change
Current discount	±1%	$ -	$ -	$ 1,530	($ 1,499)

(XIII) Additional Disclosures

Significant transactions information (including before writing-off)
(1) Financing provided to other: Please refer to Table 1.
(2) Endorsement/Guarantee provided to others: Please refer to Table 2.
(3) Those who hold securities at the end of the period: Please refer to Table 3.
(4) Acquisition or sale of the same security with the accumulated cost reaching NT$300 million or 20% of the Company's paid-in capital: None.
(5) Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more: None.

(6) Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.

(7) Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more: None.
(8) Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more: see Table 4.
(9) Engaging in derivative commodity transactions: None.

(10) Significant inter-company transactions during the reporting periods: See Table 5.

Information on investees: see Table 6.
Information on investments in China: see Table 7.
Information on major shareholders (names, shareholdings, and ratios of shareholders with a shareholding ratio of 5% or more): see Table 8.

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Table 1

Lily Logistics Development Co., Ltd. and its Subsidiaries Financing activity for others December 31, 2022

No.	Name of financing	Name of	Transaction	Related	Maximum balance of the	Balance (limit) at the	Actual amount	Interest	Nature of financing	Amount of sales to (purchase	Reason for short-term	Allowance for loss	Assets	pledged	Limit of financing amount for individual	Limit of total financing
	provider	counter party	items	party?	period	end of period	provided	rates	activity	from) counter-art	financing	accounts	It	Vl	counter-party	amount
										py			em	aue
0	Lily Logistics Development Co., Ltd.	Kunshan Lily Textile Co., Ltd.	Other receivables	Yes	$ 158,900	$153,650	$153,650	2.00%	Sales to (purchase from) counter-party	$ -	Business operations	$ -	Guarantee notes	$157,510	Lily Logistics Development Co., Ltd.’s loan limit for individual objects shall not exceed 20% of the net equity value of NT$337,850 thousand in the latest financial statement certified by an accountant or reviewed	Lily Logistics Development Co., Ltd.’s loan limit shall not exceed 40% of the net equity value of NT$675,700 thousand in the latest financial statement certified by an accountant or reviewed
		MIGHTY BUSINESS LTD.	Long-term receivables	Yes	383,013	370,398	370,398	-	Sales to (purchase from) counter-party	-	Business operations	-	None	-

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Table 2

Lily Logistics Development Co., Ltd. and its Subsidiaries Endorsement/Guarantee provided to others December 31, 2022

No. (Note 1)	Name of endorsement and guarantee company	Endorsee	Endorsee	Endorsement limit for a single entity (Note 3)	Maximum balance for the period	Outstanding endorsement/guarantee balance	Actual amount provided	Amount of collateral guarantee/endorsement	Percentage of accumulated guarantee amount to net assets value from the latest financial statement	Limit of total guarantee/endorsement amount (Note 4)	Guarantee provided by Parent Company	Guarantee provided by subsidiary	Provision of endorsements/guarantees to the party in China
		Company name	Relationship with the Company (Note 2)
0	Lily Logistics Development Co., Ltd.	Kunshan Lily Textile Co., Ltd.	3	$ 337,850	$ 185,320 (RMB 41,000)	$ 181,220 (RMB 41,000)	$ 181,220 (RMB 41,000)	RMB 41,000	10.73%	$ 844,625	Yes	No	Yes

Note 1: The description of the serial number column is as follows:

(1) Fill in 0 for the issuer.

(2) Invested companies are numbered sequentially starting from the Arabic numeral 1 according to the company.

Note 2: The relation between the endorser and the endorsed has the following 7 types, which can be marked:

(1) Companies with transaction relationship.

(2) Companies in which the Company directly or indirectly holds more than 50% of the voting shares.

(3) Companies that directly and indirectly hold more than 50% of the Company's voting shares.

(4) Between companies in which the Company directly and indirectly holds more than 90% of the voting shares.

(5) Based on the needs of contracting projects, companies in the same industry or between contractors and contractors are mutually endorsement according to the contract.

(6) The joint investment relation is a company that is endorsed and guaranteed by all shareholders in accordance with their shareholding ratio. Note 3: The balance of the Company's and its subsidiaries' endorsements to a single enterprise shall not exceed 20% of the Company's net worth. Note 4: The calculation method of the maximum limit shall not exceed 50% of the net value of the Company's latest financial statement certified by an accountant

or reviewed.

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Table 3

Lily Logistics Development Co., Ltd. and its Subsidiaries Securities held at the end of the period (excluding the control part of subsidiaries, affiliates and joint ventures) December 31, 2022

December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022
				Unit: 1,000 shares and NT$1,000
Names of companies held	Types and names of negotiable securities	Relationship between the issuer of securities and our company	Account Items	End of period
				Number of Shares	Book value	Ratio	Fair value measurement
Lily Logistics Development Co., Ltd.	Stock CHINA WIRE & CABLE CO., LTD. EVERTEX FABRINOLOGY LTD. LEAD DATA INC. FAIR FRIEND ENT.CO.,LTD. Excellence Electronic Co, Ltd. LEADWELL CNC MACHINES MFG.,CORP. CROWNPO TECHNOLOGY INC. MAXSPEED CORPORATION HUALON CORPORATION TYPHONE COMPANY LILYENT CORP. Sunny Bank Ltd. FAITH ALLIANCE CORPORATION	－－－－－－－－－－－－－	Financial assets measured at fair value through other comprehensive income - Current Financial assets measured at fair value through other comprehensive income - Non-current " " " " " " " " " " "	224 611 576 78 1 50 1 174 - 118 3,782 3,638 34	$ 5,824 11,113 1,620 2,070 20 1,331 22 - - - 82,252 54,757 61	- - - - - - - - - - - - -	$ 5,824 11,113 1,620 2,070 20 1,331 22 - - - 82,252 54,757 61
GISONG ENTERPRISE CORPORATION	Stock CHYANG SHENG DYEING & FINISHING CO., LTD. China Steel Corporation Great Giant Fibre Garment Co., LTD.	－－－	Financial assets measured at fair value through profit or loss - Current " "	73 100 8	1,044 2,980 739	- - -	1,044 2,980 739

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Table 4

Lily Logistics Development Co., Ltd. and its Subsidiaries Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more December 31, 2022

Company with accounts receivable	Name of counterparty of transaction	Relationship with the Company	Balance of receivables from related parties	Turnover	Overdue receivables from related parties	Overdue receivables from related parties	Amount of related parties recovered after the due date	Allowance for loss accounts
					Amount	Treatment method
Lily Logistics Development Co., Ltd.	MIGHTY BUSINESS LTD. (Note A)	Mutually parent company and subsidiary	$320,057	－	$320,057	－	As of the end date of the field work, not all of them have been recovered	$ - (Note C)
	Kunshan Lily Textile Co., Ltd.	Mutually parent company and sub-subsidiary	812,228	－	812,228	－	As of the end date of the field work, not all of them have been recovered	- (Note C)
MIGHTY BUSINESS LTD.	Kunshan Lily Textile Co., Ltd. (Note A)	Parent company	324,732	－	324,732	－	As of the end date of the field work, not all of them have been recovered	-

Note: A. Because the company sold machinery and equipment to Kunshan Lily Textile Co., Ltd. through MIGHTY BUSINESS LTD. The amount due from MIGHTY BUSINESS LTD. to Kunshan Lily Textile Co., Ltd. of NT$324,732 thousand, of which the amount due from MIGHTY BUSINESS LTD. of the Company is NT$320,057 thousand.

B. The Company has fully recognized the loss of shareholders' original equity within the scope of statutory obligations, constructive obligations and payments made on behalf of MIGHTY BUSINESS LTD. and Kunshan Lily Textile Co., Ltd. The total balance of investment loans is NT$1,254,440 thousand.

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Table 5

Lily Logistics Development Co., Ltd. and its Subsidiaries Significant inter-company transactions during the reporting periods December 31, 2022

Unit: In Thousands of New Taiwan Dollars

			Unit: In Thousands of New Taiwan Dollars	Unit: In Thousands of New Taiwan Dollars	Unit: In Thousands of New Taiwan Dollars	Unit: In Thousands of New Taiwan Dollars
			Status of transaction
						Percentage (%) of
Company	Counter-party	Relationship	Account	Amount	Term	consolidated total operating revenues or total assets
The Company	Mighty	Parent company to subsidiary	Long-term accounts receivable - Related parties Income receivable - related parties	$ 320,057 50,341	The transaction conditions (price, payment) are the same as those of general vendors	4.92% 0.77%
	Kunshan Lily	Parent company to subsidiary	Other accounts receivable - Related parties Other interest income Payment on behalf of others Long-term accounts receivable-Related parties	959,147 2,953 1,747 16,943	The transaction conditions (price, payment) are the same as those of general vendors	14.74% 0.35% 0.03% 0.26%
Mighty	Kunshan Lily	Subsidiary to	Other accounts receivable -	324,732	The transaction conditions	4.99%
		subsidiaries	Related parties		(price, payment) are the same as those of general vendors

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Table 6

Lily Logistics Development Co., Ltd. and its Subsidiaries Re-investment related information (excluding invested companies in mainland China) December 31, 2022

				Unit: 1,000 shares and NT$1,000	Unit: 1,000 shares and NT$1,000	Unit: 1,000 shares and NT$1,000	Unit: 1,000 shares and NT$1,000	Unit: 1,000 shares and NT$1,000	Unit: 1,000 shares and NT$1,000	Unit: 1,000 shares and NT$1,000	Unit: 1,000 shares and NT$1,000
				Original / investment		Sh hld f th d f id			~~N~~t fit l	Investment gains
Name of the investors	Name of the investees	Location	Main business and products	amount		ares e as o e en o pero			e pro (oss) of the investee for the current period	and losses recognized by the Company (Note 1)	Notes
				Ending balance of the period	End of last year	Number of Shares	Ratio	Carrying amount
Lily Logistics Development Co., Ltd.	LILY CONSTRUCTION CO., LTD.	Taiwan	1. Entrust construction companies to build commercial buildings and public housing for lease and sales businesses. 2. Entrust construction companies to develop industrial zones approved by industrial competent authorities. 3. Brokerage for house rental and sales. 4. Sales agency andreinvestmentof the above-mentionedrelated businesses.	$ -	$ -	2,695	44.91%	$ 173,411	$ 2,678	$ 1,231	Associates
	GIANTEX TEXTILE CORPORATION	Taiwan	1. Spinning and weaving of various fibers such as natural fibers, man-made fibers, and chemical fibers. 2. Printing, bleaching, dyeing and finishing of various fiber products. 3. General import and export trade (except futures) (except licensing business) 4. Entrust construction companies to develop industrial zones approved by industrial competent authorities. 5. Entrust construction companies to build commercial buildings and public housing for lease and sales businesses. 6. Design, manufacture and sales of computer system hardware and related software. 7. Import and export of computers and related electronic components. 8. Sales agency andreinvestmentof the above-mentionedrelated businesses.	309,981	309,981	26,818	46.27%	12,891	11,444	5,295	Associates
	GISONG ENTERPRISE CORPORATION	Taiwan	Spinning of yarn	114,000	114,000	11,400	57.00%	140,630	9,560	5,449	Subsidiary
	LILYTEX INTERNATIONAL CORP.	Taiwan	Various food and beverages, cosmetics, medicines, batteries, toys, information software, electrical appliances and business machines	-	44,400	-	-	-	-	-	(Note 2)
	SUNNY LOGISTICS CO., LTD.	Taiwan	Logistics	99,211	99,211	7,803	44.76%	200,500	9,316	4,170	Associates
	LILYTEX INTERNATIONAL CORP.	BVI	Based on the instructions of the parent company's operating policies to reinvest in various businesses outside Taiwan	419,541	419,541	12,600	70.59%	(1,208,774)	( 151,114)	( 106,671)	Subsidiary
	MIGHTY BUSINESS LTD.	BVI	Based on the instructions of the parent company's operating policies to reinvest in various businesses outside Taiwan	35	35	1	100.00%	( 45,666)	( 4,498)	( 4,498)	Subsidiary

Note 1: Including the amortization amount of the unrealized profit and loss of forward and backward transactions in the previous year. Note 2: The liquidation of the company was completed on June 13, 2022.

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Table 7

Lily Logistics Development Co., Ltd. and its Subsidiaries Information on investments in China December 31, 2022

						December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022
(1) Content Name of the invested companies in the mainland China Main business and products Total amount of paid-in capital Method of investment (Note 1) Accumulated amount of remittance from Taiwan to China at the ~~b~~eginning of the current period Kunshan Lily Textile Co., Ltd. Warehousing and leasing USD 24,782 (II) $ 419,511 (USD 12,600)
	Name of the invested companies in the mainland China	Main business and products	Total amount of paid-in capital	Method of investment (Note 1)	Accumulated amount of remittance from Taiwan to China at the ~~b~~eginning of the current period	Investment flows		Accumulated amount of remittance from Taiwan to China at the end of the current period	Ownership held by the Company (direct or indirect)	Net profit (loss) of the investee for the current period	Investment (loss) gain recognized for the current period (Note 2)	Carrying value at end of year	Accumulated amount of investment income remitted back as of the end of this period
						Outward remittance	Recovery
	Kunshan Lily Textile Co., Ltd.	Warehousing and leasing	USD 24,782	(II)	$ 419,511 (USD 12,600)	$ -	$ -	$ 419,511 (USD 12,600)	55.21%	($ 193,216)	($ 151,114) (II)2	($ 1,396,695)	$ -

Note 1: The investment methods are divided into the following three types, and the type of type can be marked:

(I) Directly to the mainland China to engage in investment.
(II) Reinvest in the mainland China through companies in the third region.
(III) Subsidiaries reinvested and established in mainland China.
Note 2: In the current period recognized investment profit and loss column:
(I) If it is under preparation and there is no investment profit or loss, it should be indicated.
(II) The recognition basis of investment profit and loss is divided into the following three types, which shall be specified.
Financial statements audited by an international accounting firm that has a cooperative relationship with the accounting firm of the

Republic of China.

The financial statements audited by CPA of the parent company in Taiwan.
Preliminary statement.

Note 3: Relevant figures in this Table shall be denominated in NTD.

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Name of the invested companies in the mainland China	Accumulated amount of remittance from Taiwan to China as of the end of theperiod	Investment amounts authorized by Investment Commission, MOEA	Ceiling on investments in China imposed by the Investment Commission of MOEA
Kunshan Lily Textile Co., Ltd.	$ 419,511	USD 12,600	$ 1,013,549

Note: According to the regulations of the Investment Review Committee of the Ministry of Economic Affairs, if the net value is less than NT$5 billion, the cumulative amount or proportion of its investment in the mainland is capped at 60% of the net value or NT$80 million (whichever is higher).

(2)Significant transactions with invested companies in mainland China that occurred indirectly through third-region enterprises:

For the major transactions between the company and its mainland investee companies directly or indirectly in 2022, please refer to the "Information on Material Transactions" and the consolidated financial report "Business Relationship between Parent and Subsidiary Companies and Important Transactions".

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Table 8

Lily Logistics Development Co., Ltd. Information of principal shareholders December 31, 2022

Lily Logistics Development Co., Ltd. Information of principal shareholders December 31, 2022	Lily Logistics Development Co., Ltd. Information of principal shareholders December 31, 2022	Lily Logistics Development Co., Ltd. Information of principal shareholders December 31, 2022
(Unit: 1,000 shares)
Shares Name of Main Shareholders	Number of Shares Held	Percentage of ownership
SUNNY LOGISTICS CO., LTD.	13,267	9.80%
RITER SHUN TRADING COMPANY LIMITED	12,120	8.95%
Xin RongInvestment Co., Ltd.	10,140	7.49%
YishengInvestment Co., Ltd.	8,987	6.64%
Su, Chin-Yuan	8,074	5.96%
SU, HAO-YI	7,101	5.24%

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(XIV) Segment Information

General Information

For management purposes, the Group's operating decision makers divide operating units based on business entities, and divide the main reporting segments into spinning and logistics segments. Due to the small scale of operations, the operations of some subsidiaries are not included in the operational decision-making report, so they are not included in the reportable departments, and their operating results are consolidated and expressed under "Other Segments":

Sales segment: Sales and agency business of various cloth products and other commodities. Originally belonging to the textile segment, after the Group's business decision-makers decided to stop the production business of the cotton spinning, and the major business of the textile segment has gradually transformed into various sales businesses since 2019.

Logistics segment: Warehousing leasing, tallying and processing business.

Measurement basis
The Group's operating decision makers individually monitor the operating results of each operating unit to make decisions on resource allocation and performance evaluation. The performance of the segment is evaluated based on operating net (loss) and measured in a manner consistent with operating net (loss) in the financial report. The accounting policies of the operating segments are the same as those in the summary of the significant accounting policies described in Note (4) to the financial report.
The operating segment information is as follows: (1) 2022

(1) 2022
Operating revenue: External customer Inter-segment Total revenue Segment profit Segments assets Segments liabilities (2) 2021 Operating revenue: External customer Inter-segment Total revenue Segment profit Segments assets Segments liabilities	Sales segment	Logistics segment	Other business segment	Reconciliation and cancellation	Unit: NT$1,000 Total
	$ 257,750 -	$ 589,750 -	$ - -	$ - -	$ 847,500 -
	$257,750	$ 589,750	$-	$-	$ 847,500
	$11,755	$220,533	$-	$13,541	$245,829
	$647,033	$7,673,906	$-	($1,815,395)	$6,505,544
	$441,816	$7,654,806	$-	($2,929,205)	$5,167,417
	Sales segment	Logistics segment	Other business segment	Reconciliation and cancellation	Unit: NT$1,000 Total
	$ 443,392 8	$ 423,425 -	$ - 140	$ - (148)	$ 866,817 -
	$443,400	$423,425	$140	($148)	$ 866,817
	$ 37,765	$104,915	($ 32)	$ 39,446	$182,094
	$671,636	$6,723,146	$-	($997,224)	$6,397,558
	$444,548	$6,966,385	$-	($2,192,541)	$5,218,392

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6.5 The Company’s Individual Financial Statement for the Most Recent Fiscal Year, Audited and Attested by CPAs

Independent Auditor’s Report

To: Lily Logistics Development Co., Ltd.

Opinion

Lily Logistics Development Co., Ltd.'s parent company only balance sheet of December 31 of 2022 and 2021, the parent company only comprehensive income statement, parent company only statement of changes of equity, and parent company only cash flow statement from January 1 to December 31 of 2022 and 2021 and the notes to the parent company only financial statements (including the summary of major accounting policies) have been audited by the Auditor of the Firm.

According to the opinions of the Auditor, the above-mentioned parent company only financial statements are prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers in all material aspects, which are sufficient to express the parent company only financial status of Lily Logistics Development Co., Ltd. on December 31, 2022 and 2021, and parent company only financial performance and parent company only cash flow from January 1 to December 31 in 2022 and 2021.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards. Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Parent-Only Financial Statements section of our report. We are independent of the Lily Logistics Development Co., Ltd. (the Company) in accordance with the Professional Ethics for Certified Public Accountant of the Republic of China and we have fulfilled our other ethical responsibilities in accordance with these requirements. The Auditor believes that sufficient and appropriate audit evidence has been obtained as a basis for expressing audit opinion.

Key Audit Matters

Key audit issues are those that, in our professional judgment, were of utmost significance in our audit of the parent company only financial statements of the Company for the year 2022. These matters were addressed in the context of our audit of the parent company only financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these issues. The key audit items of Lily Logistics Development Co., Ltd.'s parent company only financial statements in 2022 are as follows:

Impairment of accounts receivable

Please refer to Notes (4)6, (6)4 and (7) of the parent company only financial statement for relevant disclosures on impairment of receivables.

For Lily Logistics Development Co., Ltd.'s receivables (including related parties) on December 31, 2022, the impairment was recognized by the management level via various external evidence evaluations. Since it involves the judgment of the management level, it is listed as the key items to be verified by the Auditor when reviewing the financial statement.

The major audit procedures performed by the Auditor in response to the above key audit matters include:

Obtain the aging analysis table of accounts receivable, calculate the aging interval, and audit the original documents to verify that the accounts receivable have been listed in the appropriate period in the aging analysis table; and select the sample and send the letter for confirmation.
Review historical collection records, industrial economic conditions, and customer credit risk information, and test the collection situation after the period to evaluate the rationality of the Company’s allowance for impairment and impairment loss of receivables.
Obtain the evaluation document for the impairment of accounts receivable, confirm whether it

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complies with the Company's accounting policies, and review whether the management level's disclosure of the allowance for accounts receivable is appropriate.

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

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

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

The governing unit of Lily Logistics Development Co., Ltd. is responsible for supervising the financial reporting process.

Auditors' Responsibilities for the Audit of the Parent-Only Financial Statements

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

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

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

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Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinions for Lily Logistics Development Co., Ltd.

The planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements for the year 2022, and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Crowe Global Accountants:

Accountants:

License Number: Jin Guan Zheng Shen Zi No. 10200032833 March 13, 2023

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Lily Logistics Development Co., Ltd.

Parent Only Balance Sheets December 31, 2022 and 2021

Unit: In Thousands of New Taiwan Dollars

December 31,2022 Amount % $ 1,350,452 20 68,490 1 5,824 - 2,402 - 60,120 1 2,701 - 6,211 - 1,009,488 15 762 - 1,655 - 4,918 - 4,601 - 181,533 3 1,747 - 5,326,198 80 153,246 2 527,432 8 4,260,576 64 7,917 - 377,027 6 $ 6,676,650 100	December 31,2021	December 31,2021
Amount $ 1,350,452 68,490 5,824 2,402 60,120 2,701 6,211 1,009,488 762 1,655 4,918 4,601 181,533 1,747 5,326,198 153,246 527,432 4,260,576 7,917 377,027 $ 6,676,650	Amount $ 1,329,508 144,257 6,003 12,229 52,851 1,828 3,552 907,704 841 1,908 4,918 13,417 178,253 1,747 5,030,290 125,536 482,522 4,095,153 1,173 325,906 $ 6,359,798	%
		21
		2 - - 1 - - 14 - - - 1 3 -
		79
		2 8 64 - 5
		100

(Continued to next page)

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(Contd.)

December 31,2022 Amount % $383,034 6 185,000 3 1,637 - 13,472 - 152 - 3,567 - 40,537 1 210 - 3,018 - 3,124 - 132,000 2 317 - 4,604,367 69 2,900,000 43 370,231 6 4,819 - 17,247 - 1,312,070 20 4,987,401 75 1,353,430 20 701 - (390,514) (6) (390,514) (6) 725,632 11 83,624 1 138,376 2 503,632 8 - - 1,689,249 25 $6,676,650 100	December 31,2021	December 31,2021
Amount $383,034 185,000 1,637 13,472 152 3,567 40,537 210 3,018 3,124 132,000 317 4,604,367 2,900,000 370,231 4,819 17,247 1,312,070 4,987,401 1,353,430 701 (390,514) (390,514) 725,632 83,624 138,376 503,632 - 1,689,249 $6,676,650	Amount $298,079 100,000 3,025 8,160 48 29,893 32,670 96 2,736 1,197 120,000 254 4,632,658 3,075,000 370,231 - 16,699 1,170,728 4,930,737 1,353,430 701 (614,008) (614,008) 688,938 98,839 86,467 503,632 - 1,429,061 $6,359,798	%
		5
		2 - - - - 1 - - - 2 -
		73
		48 6 - - 19
		78
		21
		-
		(10)
		(10)
		11
		2 1 8
		-
		22
		100

(The notes attached to the parent company only financial statements constitute a part of this parent company only financial statements)

Chairman:

Managerial officers:

Head-Finance & Accounting:

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Lily Logistics Development Co., Ltd.

Parent Only Statement of Comprehensive Income January 1 to December 31, 2022 and 2021

Unit: In Thousands of New Taiwan Dollars

2022	% 100 (54) 46 (7) ( 1) ( 6) - 39 - 1 - 23 ( 8) ( 16) 39 - 39 - 39 6 - 3 6 (3) 45	2021
Amount $ 577,959 (311,768) 266,191 (41,361) ( 7,009) ( 34,352) - 224,830 616 7,029 1,178 134,088 ( 46,655) ( 95,024) 225,446 - 225,446 - 225,446 34,742 ( 1,952) 14,583 37,326 (15,215) $ 260,188	%	Amount $ 532,014 (342,959) 189,055 (40,461) ( 6,126) ( 33,653) (682) 148,594 76,212 6,339 1,851 ( 22,782) ( 37,376) 128,180 224,806 2 224,808 (2,621) 222,187 37,936 ( 1,221) 1,976 44,113 (6,932) $ 260,123 $ 1.67 (0.02) $ 1.65	%
	100 (54)		100 (64)
	46 (7)		36 (8)
	( 1) ( 6) -		( 1) ( 7) -
	39 -		28 14
	1 - 23 ( 8) ( 16)		1 - ( 4) ( 7) 24
	39 -		42 -
	39 -		42 -
	39		42
	6		7
	- 3 6 (3)		- - 8 (1)
	45		49
$ 1.67 - $ 1.67

(The notes attached to the parent company only financial statements constitute a part of this parent company only financial statements) Chairman: Managerial officers: Head-Finance & Accounting:

Chairman:

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Lily Logistics Development Co., Ltd.

Parent Only Statement of Changes in Equity January 1 to December 31, 2022 and 2021

Unit: In Thousands of New Taiwan Dollars

Items	Other Components of Equity Exchange differences on translation of foreign operations Unrealized gain or loss on financial assets measured at fair value through other comprehensive income Real estate revaluation appreciation $ 105,771 $ 40,378 $ 503,632 - - - ( 6,932) 46,089 - - - - 98,839 86,467 503,632 - - - ( 15,215) 51,909 - $ 83,624 $ 138,376 $ 503,632	Other Components of Equity Exchange differences on translation of foreign operations Unrealized gain or loss on financial assets measured at fair value through other comprehensive income Real estate revaluation appreciation $ 105,771 $ 40,378 $ 503,632 - - - ( 6,932) 46,089 - - - - 98,839 86,467 503,632 - - - ( 15,215) 51,909 - $ 83,624 $ 138,376 $ 503,632	Total Equity
	Exchange differences on translation of foreign operations $ 105,771 - ( 6,932) - 98,839 - ( 15,215) $ 83,624	Unrealized gain or loss on financial assets measured at fair value through other comprehensive income $ 40,378 - 46,089 - 86,467 - 51,909 $ 138,376
Balance as of January 1, 2021 Net of 2021 Other comprehensive income for 2021 Changes in ownership interests in subsidiaries Balance as of December 31, 2021 Net of 2022 Other comprehensive income for 2022 Balance as of December 31, 2022			$ 1,161,199 222,187 37,936 7,739
			1,429,061 225,446 34,742
			$ 1,689,249

(The notes attached to the parent company only financial statements constitute a part of this parent company only financial statements)

Chairman:

Managerial officers: Head-Finance & Accounting:

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Lily Logistics Development Co., Ltd. Parent Only Statement of Cash Flows January 1 to December 31, 2022 and 2021

Unit: In Thousands of New Taiwan Dollars

Items Cash flows from operating activities Net profit before tax from continuing operations Net profit before tax from discontinuing operations Profit before tax from continuing operations Net income before tax Adjustments to reconcile profit (loss) not affected Depreciation Amortization expenses Expected loss on credit impairment Interest expense Interest income Dividend income Profit and loss of subsidiaries, associates and joint ventures recognized by using equity method Gain on disposal and scrapping of property, plant and equipment Loss of investments disposed of Changes in current assets and liabilities related to operating activities Decrease of notes receivable Increase of accounts receivable Accounts receivable - Increase of related parties Decrease (increase) of other accounts receivable Other accounts receivable-Decrease (increase) of related parties Decrease of inventory Decrease of prepayments Decrease of other current assets Increase in their financial assets Decrease of contract liabilities Increase (decrease) of notes payable Notes payable-Increase (decrease) of related parties Increase (decrease) of accounts payable Accounts payable - Increase of related parties Increase of other payables Other payables - Increase of related parties Increase for allowance for liabilities Increase (decrease) of other current liabilities Decrease of confirmed benefit debt Cash flow generated from operating activities Interest received Dividends received	2022 $ 225,446 - 225,446 87,857 5,180 - 46,655 ( 7,029) ( 1,115) 95,024 - 1 9,827 ( 7,269) ( 873) ( 2,625) ( 86,584) 253 8,155 - ( 3,280) ( 1,388) 5,312 104 ( 26,326) - 1,563 114 282 63 ( 1,404) 347,943 6,995 9,665	2021
		$ 224,806 ( 2,621)
		222,185 66,613 5,034 682 37,376 ( 6,339) ( 1,615) ( 128,180) ( 1,205) 4,921 7,313 ( 3,795) ( 1,828) 1,444 10,538 11,796 6,441 78 ( 1,640) ( 995) ( 8,295) ( 31) 17,427 90 1,396 - 322 ( 154) ( 769)
		238,810
		6,333 1,615

(Continued to next page)

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(Contd.)

Items Interest paid Income tax returned Inflow of net cash used in operating activities Cash flows from investing activities: Acquisition of financial assets measured at fair value through other comprehensive income Disposal of investments accounted for under the equity method Acquisition of property, plant and equipment Decrease (increase) in refundable deposits Other accounts receivable-Decrease (increase) of related parties (financing) (Increase) decrease of collection (including long-term receivables) Increase of other non-current assets Increase of prepaid of equipment Net cash used in investing activities Cash flows from financing activities: Increase (decrease) of short-term loans Proceeds from/repatment of long-term debt Decrease of guarantee deposits Repayment of principal of lease liabilities Net cash generated by (used in) financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year	2022 ($ 45,801) 79 318,881 ( 12,948) 10 ( 240,826) ( 600) ( 15,200) ( 32,321) ( 1,695) (25,330) (328,910) 85,000 ( 163,000) 14,958 (2,696) (65,738) ( 75,767) 144,257 $68,490	2021
		($ 36,479) 210
		210,489
		( 4,037) 837 ( 282,913) 2,490 2,100 6,424 ( 80) (93,006)
		(368,185)
		( 2,377,000) 2,595,000 25,290 (3,165)
		240,125
		82,429 61,828
		$144,257

(The notes attached to the parent company only financial statements constitute a part of this parent company only financial statements)

Chairman: Managerial officers: Head-Finance & Accounting:

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Lily Logistics Development Co., Ltd.

Notes to the Parent-Only Financial Statements January 1 to December 31, 2022 and 2021

(Expressed in NT$1,000 unless Otherwise Stated)

(I) Company History

(II) Date and Procedures of Authorization of Financial Statements for Issue
The parent company only financial statements are released after approval by the board of directors on March 13, 2023.
(III) Newly Issued or Revised Standards and Interpretations
The impact of adopting the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations (hereinafter referred to as "IFRSs") as endorsed by the FSC:
- The following table summarizes the newly released, corrected and amended standards and interpretations of the applicable International Financial Reporting Standards recognized by the FSC for 2022:

he FSC for 2022:
Newly-released / corrected / amended standards and interpretations Amendments to IAS 16 "Property, Plant and Equipment: Prices before Reaching the State of Intended Use" Amendment to IAS 37 “Onerous Contracts - Cost of Fulfilling a Contract” Amendment to IFRS 3 “Reference to Conceptual Framework” Annual improvements to IFRS 2018-2020	Effective date of publication by the IASB (Note 1)
	January 1, 2022 (Note 2) January 1, 2022 (Note 3) January 1, 2022 (Note 4) January 1, 2022 (Note 5)

Note 1: Unless otherwise specified, the above-mentioned newly issued/corrected/amended standards or interpretations are effective for the annual reporting period starting after the respective dates.
Note 2: Enterprises shall apply these amendments retrospectively, however, it is only applicable to the property, plant and equipment items that have reached the necessary location and state to meet the management level's expected operation mode after the starting date (January 1, 2021) of the earliest period expressed in the financial statements to which the amendments are applied for the first time.
Note 3: This amendment applies to contracts that have not fulfilled all obligations on January 1, 2022.
Note 4: This amendment applies to business combinations whose acquisition date begins after January 1, 2022 during the annual reporting period.
Note 5: The amendments to IFRS 9 apply to the exchange or modification of financial liabilities for annual reporting periods beginning after 1 January 2022; the amendments to IAS 41 apply to fair value measurement for annual reporting periods

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commencing after January 1, 2022; and the amendments to IFRS 1 apply retrospectively to annual reporting periods beginning after 1 January 2022.

(1) Amended “Property, Plant and Equipment: Proceeds before Intended Use” of IAS 16 The amendment provides that The sale price of items brought about to bring property, plant and equipment to the location and condition necessary to operate in the manner intended by management shall not be recognized as a reduction in the cost of the asset. The above-mentioned output items shall be measured according to IAS 2 "inventory", and the sales price and cost shall be recognized in profit or loss according to the applicable standards. In addition, the amendment also clarifies that the cost of testing whether an asset is in normal operation refers to the expenditure for evaluating whether the technical and physical performance of the asset is sufficient to enable it to be used for production or provision of products or services, leased to others, or management purposes.

This amendment applies to plant, property and equipment in the necessary location and condition to reach the necessary location and condition of the management's intended mode of operation after January 1, 2021 (the earliest date for the beginning of the period of expression). When the Company applies the amendment for the first time, the cumulative impact of initial application of the amendments will be recognized as an adjustment to the beginning balance of retained earnings (or other components of equity, as appropriate) at the beginning of the earliest presentation period and the information for the comparative periods will be restated.

(2) Amendment to IAS 37 “Onerous Contracts - Cost of Fulfilling a Contract”
The amendment clarifies that, when assessing whether a contract is onerous, "costs of fulfilling a contract" shall include the incremental costs of fulfilling a contract (for example, direct labor and materials) and the allocation of other costs directly related to fulfilling a contract (for example, Allocation of depreciation expenses for items of property, plant and equipment used under the contract).
(3) Amendment to IFRS 3 “Reference to Conceptual Framework”

(4) Annual improvements to IFRS 2018-2020
The annual improvement of IFRS 2018-2020 includes the revision of certain standards, among which the revision of IFRS 9 is to assess whether there is a significant difference in the exchange or modification of financial liabilities, and compare the discounted cash flow value of the new and old contract terms (including the signing of new contracts or modification If there is a 10% discrepancy between the net amount of fees charged and paid under the contract), the aforementioned fees collected and paid shall only include the fees received and paid between the borrower and the lender.
The Company has evaluated that the above standards and interpretations have no significant impact on the Company's financial status and financial performance.
The impact of the newly released and revised International Financial Reporting Standards approved by the FSC:
The following table summarizes the newly released, corrected and amended standards and interpretations of the applicable International Financial Reporting Standards recognized by the FSC for 2023:

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Newly-released / corrected / amended standards and interpretations Amendments to IAS 1 "Disclosure of Accounting Policies" Amendments to IAS 8 "Definition of Accounting Estimates" Amendments to IAS 12 "Deferred Income Tax related to Assets and Liabilities arising from Single Transaction"	Effective date of publication by the IASB
	January 1, 2023 (Note 1) January 1, 2023 (Note 2) January 1, 2023 (Note 3)

Note 1: This amendment applies to the annual reporting period beginning after January 1, 2023.
Note 2: This amendment applies to changes in accounting estimates and changes in accounting policies that occur during the annual reporting period beginning after January 1, 2023.
Note 3: Unless there are additional provisions for temporary differences related to leasing and decommissioning obligations, this amendment applies to transactions occurring after the start date of the earliest comparative period expressed (January 1, 2022).
(1) Amendments to IAS 1 "Disclosure of Accounting Policies"
This amendment clarifies that when a transaction, other event or situation is significant in scale or nature, and its related accounting policy information is also significant to the financial report, such relevant significant accounting policy information should be disclosed. Conversely, if an enterprise determines that the scale or nature of a transaction, other event, or situation is not material, or that the accounting policy information related to it is not material, it is not necessary to disclose such insignificant accounting policy information. However, the conclusion made by the enterprise that the accounting policy information is not significant will not affect the relevant disclosures required by other IFRS standards.
(2) Amendments to IAS 8 "Definition of Accounting Estimates"
This amendment defines accounting estimates as monetary amounts in financial statements that are affected by measurement uncertainty, and provides further clarification that, except for corrections caused by prior-period errors, the effects of changes in input values or measurement techniques on accounting estimates are accounting Estimated changes.
(3) Amendments to IAS 12 "Deferred Tax related to Assets and Liabilities arising from a Single Transaction"
The amendments narrow the scope of the exemption from recognition of deferred tax liabilities and assets in paragraphs 15 and 24 of IAS 12. If the taxable temporary difference arising from a single transaction at the time of original recognition is the same as the deductible temporary difference, the above exemption does not apply. When the enterprise applies this amendment for the first time, it shall recognize deferred income tax on all temporary differences related to lease and decommissioning obligations on the starting date of the earliest comparative period expressed (January 1, 2022), and the cumulative effect is recognized at that date as an adjustment to the initial balance of retained earnings (or other component of equity, as appropriate). For other transactions that occurred after January 1, 2022, the application of this amendment shall be deferred. When the Company applies this amendment for the first time, it shall restate the comparative period information.

The Company has evaluated that the above standards and interpretations have no significant impact on the Company's financial status and financial performance.

The impact of the International Financial Reporting Standards issued by the International Accounting Standards Board but not yet approved by the FSC:
The following table summarizes the newly issued, revised and revised standards and interpretations that have been issued by the International Accounting Standards Board but have not yet been incorporated into the International Financial Reporting Standards approved by the FSC:

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As of the issuance date of the parent company only financial statements, the Company is still continuously evaluating the impact of the above-mentioned standards and interpretations on the Company's financial status and performance, and the relevant impact will be disclosed when the evaluation is completed.

(IV) Summary of Significant Accounting Policies

The major accounting policies adopted in the preparation of the patent company only financial statements are described below. Unless otherwise stated, these policies apply consistently throughout all reporting periods.

Compliance statement

These parent company only financial statements of the Company have been prepared in accordance with the "Rules Governing the Preparation of Financial Statements by Securities Issuers."

Compilation basis
(1) The parent company only financial statements have been prepared on a historical cost basis except for the following key items:
- A. Financial assets and liabilities (including derivatives) at fair value through profit or loss.
- B. Financial assets and liabilities at fair value through other comprehensive income.
- C. Liabilities for cash-settled share-based payment agreements measured at fair value.
(2) The preparation of financial reports that comply with the IFRSs recognized by the Financial Supervisory Commission requires the use of certain key accounting estimates. In the process of applying the Company's accounting policies, the management level also needs to make judgments, requires items involving high-level judgments or complexity, or items involving major assumptions and estimates of consolidated financial statements. Please refer to Note (5) for description.
Foreign Currency Conversion
(1) The items listed in the Company's financial statements are all measured in terms of the currency of the primary economic environment in which the entity operates (the functional currency). The financial statements are presented in New Taiwan dollars, which is the Company's functional currency.
(2) When preparing financial reports, transactions in currencies other than the parent company only functional currency (foreign currency) are recognized at the exchange rate on the transaction date, and at the end of the reporting period, monetary items of foreign currency are re-converted at the spot exchange rate on that date, and the exchange difference will be recognized as profit or loss of the current period. Foreign currency non-monetary items measured by fair value are converted at the exchange rate on the day when the fair value is determined, and the resulting exchange difference is listed as profit or loss for the year. However, if changes in fair value are recognized in other comprehensive profit or loss, the resulting exchange differences are recognized

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in other comprehensive profit or loss. Non-monetary items in foreign currencies measured at historical cost are translated at the exchange rate on the transaction date and will not be re-translated.

(3) For the preparation of financial statements, the assets and liabilities of overseas operating units are converted into NTD at the spot exchange rate at the end of the reporting period; items of income and expense are converted at the current average exchange rate, and the resulting exchange differences are recognized as other comprehensive profit or loss and accumulated in equity under the conversion of financial reports of overseas operating units (with appropriate allocation to non-controlling interests).
Classification of current and non-current assets and liabilities
(1) Assets that meet one of the following conditions are classified as current assets:
- A. The asset is expected to be realized in the normal cycle of business, or is intended to be sold or consumed.
- B. Held primarily for trading purposes.
- C. Those expected to be realized within twelve months after the balance sheet date.
- D. Cash or cash equivalents, unless exchanged, liquidated, or otherwise restricted more than twelve months after the balance sheet date.

The Company classifies all assets that do not meet the above conditions as non-current.

(2) Liabilities that meet one of the following conditions are classified as current liabilities:
A. Expected to be settled in the normal business cycle.
B. Held primarily for trading purposes.
C. Those that shall be repaid within twelve months after the balance sheet date. (Even if a long-term refinancing or rescheduling payment agreement has been completed after the balance sheet date and before the release of the financial report, it will also be the current liabilities).
D. Those who cannot unconditionally extend the repayment period to at least twelve months after the balance sheet date. The terms of the liability, which may be settled by issuing equity instruments at the option of the counterparty, do not affect its classification.

The Company classifies all liabilities that do not meet the above conditions as non-current.

Cash and cash equivalents

Cash and cash equivalents include cash on hand, cash in and short-term, highly liquid investments (including time deposits with an original maturity within three months) that can be converted into fixed amounts of cash at any time and whose value risk changes little.

Financial instruments

Financial assets and financial liabilities shall be recognized when the Company becomes a party to the contractual terms of the financial instrument.

When financial assets and financial liabilities are originally recognized, they are measured at fair value. At the time of original recognition, the transaction costs directly attributable to the acquisition or issuance of financial assets and financial liabilities (except those classified as financial assets and financial liabilities measured at fair value through profit or loss) shall be added or subtracted from the fair value of the financial assets or financial liabilities.

Transaction costs directly attributable to financial assets and financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

(1) Financial assets

Customary transactions of financial assets are recognized using transaction date accounting.

A. Types of measurement

The types of financial assets held by the Company are financial assets measured at fair value via profit or loss and financial assets measured at cost after amortization.

(A) Financial assets measured at fair value through profit or loss

Financial assets measured at fair value through profit or loss include those that are mandatorily classified and those designed. Financial assets that are mandatorily measured at FVPL include investments in equity instrument not designated by the Company to be measured at FVOCI, and investments in

- 141 -

debt instrument that do not qualify for classification as measured at amortized cost or at fair value through other comprehensive income. When any financial asset meets one of the following conditions, the Company will designate it as measured at fair value through profit or loss at the time of original recognition:

a. Being a mixed (combined) contract; or

b. May eliminate or significantly reduce measurement or recognition inconsistencies; or

c. An investment that is managed and evaluated on a fair value basis in accordance with a written risk management or investment strategy. Financial assets at fair value through profit or loss are measured at fair value, its dividends, interest income and remeasurement gains or losses are recognized in other gains and losses/dividends arising are recognized in other income, interest income and remeasurement gains or losses are recognized in other gains and losses. Please refer to Note (12) for the determination method of fair value.

(B) Financial assets measured at amortized cost

If the Company invests in financial assets that meet the following two conditions at the same time, it will be classified as financial assets measured at amortized cost:

a. Held under a business model whose purpose is to hold financial assets for the purpose of receiving contractual cash flows; and
b. The terms of the contract give rise to cash flows on specified dates that are exclusively payments of principal and interest on the outstanding principal amount.

Except for the following two cases, interest income is calculated by multiplying the effective interest rate by the total book value of financial assets:

a. For purchased or created credit-impaired financial assets, interest income is calculated by multiplying the credit-adjusted effective interest rate by the amortized cost of the financial asset.

b. For financial assets that are not purchased or created credit-impaired but subsequently become credit-impaired, the interest income is calculated by multiplying the effective interest rate by the amortized cost of the financial asset.
(C) Investments in equity instruments measured at fair value through other comprehensive income

At the time of original recognition, the Company may irrevocably designate the equity instrument investment that is not held for trading and recognized as a contingent consideration by a business merger to be measured at fair value through other comprehensive gains and losses.

Dividends on investments in equity instruments at fair value through other comprehensive income are recognized in profit or loss when the Company's right to receive payment is established, unless the dividend clearly represents a recovery of part of the cost of the investment.

B. Impairment of financial assets

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(A) The Company evaluates financial assets (including accounts receivable) measured at amortized cost, debt instrument investments measured at fair value through other comprehensive profit and loss, debt instrument investments, and lease receivables (operating/financing) and impairment losses of contract assets at fair value through other comprehensive income.
(B) Accounts receivable, contract assets and lease receivable (operating/financing) are recognized as allowance for losses based on expected credit losses during the duration. For other financial assets, first, assess whether the credit risk has increased significantly since the original recognition. If there is no significant increase, the allowance loss will be recognized as the 12-month expected loss. If there is a significant increase, the provision loss shall be recognized according to the expected credit loss during the duration.
(C) Expected credit loss is the weighted average credit loss weighted by the risk of default. The 12-month expected credit loss represents the expected credit loss arising from possible default events of the financial instrument within 12 months after the reporting date, and the expected credit loss during the duration represents the expected credit loss arising from all possible default events of the financial instruments during the expected duration.
(D) Impairment losses on all financial assets are reduced by means of an allowance account to reduce their carrying amount, however, the allowance loss for debt instrument investments measured at fair value through other comprehensive profit or loss is recognized in other comprehensive profit or loss without reducing their carrying amount.

C. De-recognition of financial assets

The Company will declassify financial assets when one of the following circumstances is met:
(A) Contractual rights to cash flows from financial assets lapse.
(B) The contractual rights to receive the cash flows of the financial asset are transferred and substantially all the risks and rewards of ownership of the financial asset have been transferred.
(C) Neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset, but retains control over the financial asset.

(2) Equity instruments

The debt and equity instruments issued by the Company are classified as financial liabilities or equity according to the substance of the contract agreement and the definition of financial liabilities and equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of certain enterprise after deducting all of its liabilities. Equity instruments issued by the Company are recognized at the amount after deducting direct issuance costs from the obtained proceeds.

(3) Financial liabilities
A. Subsequent measurement

All financial liabilities are measured at amortized cost using the effective interest method except as follows:

(A) Financial liabilities at fair value through profit or loss are financial liabilities held for trading or financial liabilities designated at fair value through profit or loss on initial recognition. Financial liabilities classified as held for trading

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are those whose main purpose at the time of occurrence is to repurchase them back in the short term, and derivatives other than financial guarantee contracts or designated and effective hedging instruments. When any financial liability meets one of the following conditions, the Company will designate it as measured at fair value through profit or loss at the time of original recognition:

  - a. Being a mixed (combined) contract; or

  - b. May eliminate or significantly reduce measurement or recognition inconsistencies; or

  - c. An instrument that is managed and evaluated on a fair value basis in accordance with a written risk management policies.

(B) Financial liabilities measured at fair value through profit or loss are measured at fair value at the time of original recognition, and the relevant transaction costs are recognized as current profit or loss. It is subsequently measured at fair value, and changes in its fair value are recognized in profit or loss for the current period.
(C) Designated as a financial liability measured at fair value through profit or loss, the amount of change in fair value due to changes in credit risk is recognized in other comprehensive profit or loss, and will not be reclassified to profit or loss subsequently, and the remaining amount of change in fair value of the liability are reported in profit or loss. However, if the above-mentioned accounting treatment causes or aggravates the improper accounting ratio, the profit or loss of the liability shall be fully reported in profit or loss.
B. De-recognition of financial liabilities

The Company declassifies financial liabilities only when the obligation is discharged, canceled or lapsed. When financial liabilities are de-recognized, the difference between their carrying amount and the total consideration paid or payable (including any non-monetary assets transferred or liabilities assumed) is recognized in profit or loss. (4) Modification of financial instruments When the contract cash flow of a financial instrument is renegotiated or modified, if the financial instrument shall not be delisted, the Company will recalculate the total book value of the financial asset or the amortized cost of the financial liability by discounting the modified contract cash flow at the original effective interest rate, and recognizes the modified benefit or loss as profit or loss; and the incurred cost or charge will serve as an adjustment to the book value of the modified financial instrument and amortized over the remaining period after modification. If the renegotiation or modification results in the delisting of the financial instrument, it shall be handled in accordance with the de-recognition regulations.

(4) Modification of financial instruments
Inventory

Real estate and construction land
(1) Real estate and construction land are accounted for at actual cost. The part of the house that has been delivered is apportioned according to the selling price ratio to calculate profit and loss. At the end of the period, it is evaluated based on the lower of cost and net realizable value.
(2) The recognition of profit and loss adopts the cost recovery method.
(3) The business cycle is adopted as the criterion for dividing current and non-current.
Non-current assets to be sold (or disposal group)

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When the carrying amount of non-current assets (or disposal groups) is mainly recovered through sales transactions rather than continued usage and it is highly likely to be sold, they will be classified as assets held for sale measured at the lower of its book value and fair value less costs of sales.

Investment accounted for under the equity method
(1) The subsidiary refers to an entity (including a structured entity) controlled by the Company, when the firm is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity, it shall be regarded that the Company is controlling the entity.
(2) Unrealized gains and losses arising from transactions between the Company and its subsidiaries have been eliminated. The accounting policies of the subsidiaries have been adjusted as necessary to be consistent with the policies adopted by the Company.
(3) The Company recognizes the share of profit and loss acquired by the subsidiary as profit and loss of the current period, and the share of other comprehensive profit and loss acquired by the Company as other comprehensive profit or loss. If the share of losses recognized by the Company for a subsidiary is equal to or exceeds the equity in the subsidiary, the Company will continue to recognize losses in proportion to its shareholding.
(4) If the change in the shareholding of the subsidiary does not result in a loss of control (transactions with non-controlling interests), it will be regarded as an equity transaction, which is being regarded as the transaction with the owner. Any difference between the adjusted amount of non-controlling interests and the fair value of the consideration paid or received is directly recognized in equity.
(5) When the Company loses control over the subsidiary, the remaining investment in the former subsidiary is remeasured at fair value and adopted as the fair value of the originally recognized financial assets or the cost of the originally recognized investment in affiliated enterprises or joint ventures. The difference between the fair value and the carrying amount is recognized as profit or loss of the current period. For all amounts previously recognized in other comprehensive profit or loss related to the subsidiary, the accounting treatment is the same as if the Company directly disposes of the relevant assets or liabilities, that is, if the benefit or loss previously recognized as other comprehensive profit or loss will be reclassified as profit or loss when disposing of the relevant assets or liabilities, when control of the subsidiary is lost, the benefit or loss will be reclassified from equity to profit or loss.
(6) Affiliated enterprises refer to all entities over which the Company has significant influence but no control, generally directly or indirectly holding more than 20% of their voting shares. The Company adopts the equity method to dispose of the investment in affiliated enterprises, and recognizes it at cost when acquired.
(7) The Company recognizes the share of profit and loss acquired by the affiliated enterprises as profit and loss of the current period, and the share of other comprehensive profit and loss acquired by the Company as other comprehensive profit or loss. If the Company's share of losses to any affiliated enterprise is equivalent to or exceeds its equity in the affiliated enterprise (including any other unsecured receivables), the Company will not recognize further losses unless the Company has any statutory or constructive obligations to, or has paid on behalf of the affiliated enterprise.
(8) The unrealized gains and losses arising from transactions between the Company and affiliated enterprises have been eliminated in proportion to its equity in the affiliated enterprises; unless there is further evidence that the assets transferred in the transaction have been impaired, unrealized losses will also be eliminated. The accounting policies of the affiliated enterprises have been adjusted as necessary to be consistent with the policies adopted by the Company.
(9) In the event that an affiliate enterprise issues new shares, and the Company does not subscribe to the new shares in accordance with the proportion, resulting in a change in the investment ratio but still having a significant impact on it, the increase or decrease of the change in the net equity value is to adjust the "capital surplus" and "investments accounted for under the equity method". If the proportion of investment is reduced, in addition to the above-mentioned adjustments, the gains or losses related to the

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reduction of ownership interests that have been previously recognized in other comprehensive profit or loss, and the gains or losses must be reclassified to profit or loss when disposing of related assets or liabilities, it shall be reclassified to profit or loss according to the reduction ratio.

(10) When the Company loses its significant influence on the affiliated enterprise, the remaining investment in the original affiliated enterprise will be re-measured according to the fair value, and the difference between the fair value and the book value will be recognized as the profit and loss of the current period.
(11) When the Company disposes of an affiliated enterprise and loses its significant influence on such affiliated enterprise, for all amounts previously recognized in other comprehensive profit or loss related to the affiliated enterprise, the accounting treatment is the same as if the Company directly disposes of the relevant assets or liabilities, that is, if the benefit or loss previously recognized as other comprehensive profit or loss will be reclassified as profit or loss when disposing of the relevant assets or liabilities, when control of the affiliated enterprise is lost, the benefit or loss will be reclassified from equity to profit or loss. If there is still a significant influence on the affiliated enterprises, only the amount previously recognized in other comprehensive profit and loss shall be transferred out in an above-mentioned manner on a proportionate basis.
(12) When the Company disposes of an affiliated enterprise, if it loses its significant influence on such affiliated enterprise, it will transfer the capital surplus related to the affiliated enterprise to profit or loss; if it still has significant influence on the affiliated enterprise, it will be transferred to profit or loss according to the proportion of disposal.
(13) Pursuant to the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”, the profit or loss during the period and other comprehensive income presented in the parent company only financial reports shall be the same as the allocations of profit or loss during the period and of other comprehensive income attributable to the owners of the parent company presented in the financial reports prepared on a consolidated basis and the owners' equity presented in the parent company only financial reports shall be the same as the equity attributable to owners of the parent presented in the financial reports prepared on a consolidated basis.
Property, plant and equipment
(1) Property, plant and equipment are recorded on the basis of acquisition cost, and the relevant interest during the acquisition and construction period is capitalized. For property, plant and equipment under construction before they are ready for intended use, samples produced to test whether the assets can function normally are measured at the lower of cost and net realizable value, and the sales price and cost are recognized in profit or loss.
(2) Subsequent costs are included in the book value of the assets or recognized as a separate assets only when the future economic benefits related to the item are likely to flow into the Company and the cost of the item can be measured reliably. The book value of the replaced part shall be delisted. All other maintenance expenses are recognized as current profit or loss when incurred.
(3) Land is not depreciated. Other property, plant and equipment are depreciated using the straight-line method over their estimated useful lives using the cost model. The Company shall review the residual value, service life and depreciation method of each asset at the end of each financial year. If the expected value of the residual value and service life is different from the previous estimate, or the expected consumption pattern of the future economic benefits contained in the asset has changed significantly, from the date of the change it shall be in accordance with the International Accounting Standard No. 8 "Accounting Policies, Changes in Accounting Estimates and Errors” shall be treated in accordance with the regulations on changes in accounting estimates. The service life of each asset is as follows: Buildings 5-60 years Machine and equipment 5-21 years Utility equipment 8-15 years Transportation equipment 2-12 years

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Miscellaneous 5-21 years

(4) When disposing of or not expected to generate future economic benefits from use or disposal, the property, plant and equipment will be de-recognized. The amount of profit or loss arising from the de-recognition of property, plant and equipment is the difference between the net disposal price and the book value of the asset, and is recognized in the current profit and loss.
Leases
(1) The Company evaluates whether the contract is (or includes) leases on the date of signing of the contract. For contracts that contain the lease component and one or more additional lease or non-lease components, the Company will allocate the consideration in the contract to the lease components based on the relative stand-alone price of each lease component and the aggregate stand-alone price of the non-lease components.
A. Company as a lessee
- Except for leases of low-value underlying assets and short-term leases, which are recognized as expenses on a straight-line basis, the Company recognizes right-of-use assets and lease liabilities on the lease starting date for other leases. Right-of-use assets

Except for right-of-use assets that meet the definition of investment real estate, right-of-use assets are presented in the balance sheet as the line item.

Lease liabilities

Subsequently, the lease liability will be measured on an amortized cost basis using the effective interest method, and the interest expense is amortized over the lease term. If the lease period, the evaluation of the purchase option of the underlying asset, the expected payment amount under the residual value guarantee, or the index or rate adopted to determine the lease payment change result in changes in future lease payments, the Company will remeasure the lease liability and adjusts the right-of-use asset against it, except that if the carrying amount of the right-of-use asset has been reduced to zero, the remaining remeasured amount will be recognized in profit or loss. Lease liabilities are presented as line item in the parent company only balance sheet.

If there is any variable rent in the lease agreement that does not depend on an index or rate, it is recognized as expense in the period in which it occurs.

B. Company as a lessor

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If the lease transfers almost all the risks and rewards attached to the ownership of the underlying asset, it is classified as a finance lease; otherwise, it is classified as an operating lease.

When any lease includes land and building elements, the Company will separately evaluate the classification of each element as financial lease or operating lease, and the lease payment (including any lump-sum front-end payment) is allocated to the land and buildings according to the relative proportion of the fair value of the land and building lease rights on the date of signing of the contract. If the lease payments cannot be reliably allocated to such two elements, the entire lease will be classified as the financial lease, but if both elements clearly meet the criteria for the operating lease, the entire lease will be classified as the operating lease.

Investment property
Investment real property is real property held to earn rentals or for capital appreciation or both (including real property under construction for such purposes). Investment property also includes land held for which the future use has not yet been determined. Investment property also includes right-of-use assets that meet the definition of investment property. Self-owned investment property shall be initially measured at cost (including transaction costs).

All investment property shall be subsequently measured at fair value, and the gains or losses arising from changes in fair value are recognized in profit or loss in the year in which they occur.

Investment real estate is transferred to real estate, plant and equipment at the fair value on the date when it is first transferred for self-use.

Impairment of non-financial assets
On the date of balance sheet, the Company will estimate the recoverable amount of assets which may be subject to impairment, and recognize the impairment loss when the recoverable amount is lower than its book value. The recoverable amount is the fair value of an asset less costs of disposal or its value in use, whichever is higher. If the asset impairment recognized in the previous year does not exist, it shall be reversed within the scope of the provision for loss in the previous year.
Allowance for liabilities

Employee benefits
(1) Short-term employee benefits

Short-term employee benefits are measured at non-discounted amounts expected to be paid and are recognized as an expense when the related service is rendered.

(2) Pension
A. Defined contribution plan

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B. Defined benefits plan

(A) The net obligation under the defined benefit plan is calculated by discounting the amount of future benefits earned by the employee in the current period or past service, and the fair value of the planned assets is subtracted from the present value of the defined benefit obligation on the balance sheet date. The net defined benefit obligation is calculated annually by the actuary using the projected unit benefit method, and the discount rate is the market yield rate of government bonds (on the balance sheet date) that are consistent with the currency and period of the defined benefit plan on the balance sheet date.
(B) Remeasurements arising from defined benefit plans are recognized in other comprehensive profit or loss in the period in which they occur, and are expressed in retained earnings.
(C) Expenses related to upfront service costs are recognized immediately in profit or loss.
(3) Remuneration for employees and directors and supervisors
Employee remuneration and remuneration of directors and supervisors are recognized as expenses and liabilities when there are statutory or constructive obligations and the amount can be estimated reasonably. If there is a discrepancy between the actual distribution amount and the estimated amount in subsequent resolutions, it shall be treated as a change in accounting estimate.
(4) Severance benefits

Severance benefits are benefits provided when the employee's employment is terminated before the normal retirement date or when the employee decides to accept the company's welfare offer in exchange for the termination of employment. The Company recognizes the expense when the offer of severance benefits cannot be revoked or when the related restructuring costs are recognized, whichever occurs earlier. Benefits that are not expected to be fully settled within 12 months after the balance sheet date are discounted.

Capital and treasury stocks
(1) Capital

Common stock is classified as equity.

Incremental costs directly attributable to the issue of new shares or share options are included in equity as a reduction of the price.

(2) Treasury stocks

The Company recovers the stocks issued and recognizes them as "treasury stocks" according to the consideration paid at the time of repurchase (including directly attributable costs) as the deduction of equity. If the disposal price of the treasury stock is higher than the book value, the difference is listed as capital reserve - treasury stock transaction; if the disposal price is lower than the book value, the difference will be offset against the capital surplus generated by the transaction of the same type of treasury stock, if there is any deficit, the retained surplus will be debited. The book value of treasury stocks is weighted average and calculated separately according to the reasons for withdrawal.

Income tax
(1) The tax expense for the period comprises current and deferred tax. Income taxes are recognized in profit or loss, except for income taxes that relate to items that are recognized in other comprehensive profit or loss or directly in equity, respectively.
(2) The current income tax is calculated based on the taxable income generated by the Company's operations, using the tax rate that has been enacted or substantively enacted

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on the date of balance sheet. The management level periodically assesses the status of income tax filings with respect to applicable income tax regulations and, where applicable, estimates income tax liabilities based on the expected tax payments to the taxation competent authorities. Income tax is levied on the undistributed earnings calculated in accordance with the provisions of the Income Tax Act of Taiwan. In the year following the year in which the earnings are generated, after the shareholders' meeting approves the earnings distribution proposal, the income tax expense will be recognized based on the distribution of the actual earnings.

(3) The balance sheet method is adopted for deferred income tax, which is recognized according to the temporary difference between the tax basis of assets and liabilities and their carrying amount on the balance sheet. Deferred income tax liabilities arising from the original recognition of goodwill are not recognized if the deferred income tax arises from the original recognition of assets or liabilities in a transaction (excluding business combinations) and at the time of the transaction If it does not affect accounting profit or taxable income (tax loss), it will not be recognized. For temporary differences related to investment in subsidiaries and affiliated enterprises, if the Company can control the timing of the reversal of the temporary difference and it is highly likely that the temporary difference will not reverse in the foreseeable future, it will not be recognized. The deferred income tax is based on the tax rate (and taxation laws) that has been enacted or substantively enacted on the balance sheet date and is expected to be applicable when the relevant deferred income tax assets are realized or the deferred income tax liabilities are settled.
(4) Deferred income tax assets are recognized within the scope of temporary differences, unused tax losses and unused income tax credits that are likely to be available in future taxable income, and are reassessed on each balance sheet date. Evaluate unrecognized and recognized deferred tax assets.
(5) When there is a legally enforceable right to offset the recognized current income tax assets and liabilities and there is an intention to pay off on a net basis or to realize the assets and liquidate liabilities at the same time, the current income tax assets and current income tax liabilities will be mutually offset against each other; when there is a legally enforceable right to offset the current income tax assets and current income tax liabilities, and the deferred income tax assets and liabilities are levied by the same taxation competent authority, or when different taxpayers generate but each intends to pay off on a net basis or realize assets and settle liabilities at the same time, the deferred income tax assets and liabilities will be offset against each other.
(6) Income tax deduction accounting is adopted for tax incentives arising from the purchase of equipment or technology, research and development expenditures, personnel training expenditures, and equity investment.
Revenue recognition

The Company's revenue recognition principle from customer contracts is to recognize revenue in the following steps:

(1) Identify customer contracts;
(2) Identify the performance obligations in the contract;
(3) Determine the transaction price;
(4) Allocate the transaction price to performance obligations in the contract; and
(5) Revenue is recognized when performance obligations are met.
After the Company identifies the performance obligations in the customer contract, it will allocate the transaction price to each performance obligation, and recognizes revenue when each performance obligation is satisfied.

(6) Sale of products

The Company recognizes revenue when control of the product is transferred to the customer. The transfer of control of the product means that the product has been delivered to the customer and there are no outstanding obligations that would affect the customer's acceptance of the product. Delivery is the point at which the customer has

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accepted the product in accordance with the transaction conditions, the risk of obsolescence and loss has been transferred to the customer, and the company has objective evidence that all acceptance conditions have been met.

The Company lists the accounts receivable when the products are delivered since the Company is entitled to receive the consideration at that point.

For processing subcontract, the control of the ownership of the processed products has not been transferred, so revenue is not recognized when subcontracting.

(7) Provision of services

The services provided by the Company are mainly OEM services entrusted by customers, and the revenue is recognized when the promised services are delivered to the customers (when the customers obtain control of the assets) and there is no subsequent obligation.

Borrowing costs
- Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset are included as part of the cost of the asset until substantially all activities necessary to bring the asset to its intended use or sale have been completed. Investment income earned on the temporary investment of specific borrowings prior to the occurrence of eligible capital expenditures is deducted from the borrowing costs eligible for capitalization.
- Except for the above, all other borrowing costs are recognized as profit or loss in the period in which they are incurred.
Operating segments
- An operating segment is a constituent unit of an enterprise that engages in business activities that may generate income and incur expenses (including income and expenses arising from transactions with other constituent units within the enterprise). The operating results of the operating segment are regularly reviewed by the operating decision-maker of the enterprise to make decisions on resource allocation to the department and evaluate the performance of the department, with separate financial information.
(V) Significant Accounting Judgments, Estimates and Assumptions

The Company takes into account the economic impact caused by the COVID-19 epidemic/climate change and related government policies and regulations/military conflict between Russia and Ukraine and related international sanctions/inflation and market interest rate fluctuations into major accounting estimates, and continues to review basic assumptions and estimates. If the revision of the estimate only affects the current period, it will be recognized in the revision period; if the revision of the accounting estimate affects both the current period and the future period, it will be recognized in both the revision period and the future period.

When the Company prepares the parent company only financial statements, the important judgments, accounting estimates and assumptions adopted in the accounting policies are as follows:

Important judgments on the adoption of accounting policies
(1) Judgment on business model of financial asset classification
- The Company evaluates the business model to which financial assets belong based on the level that reflects the joint management of financial asset groups to achieve specific business objectives. This assessment considers all relevant evidence, including how the asset's performance is measured, the risks affecting performance, and how the compensation of relevant managerial officers is determined, and requires the use of judgment. The Company continues to assess whether its business model judgment is appropriate, and for such purpose, monitors financial assets measured at amortized cost and debt instrument investments measured at fair value through other comprehensive profit and loss that are delisted before the maturity date to understand the reasons for its disposal of assess whether the disposition is consistent with the objectives of the business model. If it is found that the business model has changed, the Company will reclassify financial assets in accordance with the provisions of IFRS 9, and postpone the application from the date of reclassification.
(2) Revenue recognition

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A. The Company makes judgement in accordance with IFRS 15 to determine whether it has obtained or not the control of specific products or services before transferring them to the customer, and will be the principal or agent in the transaction. If it is determined as a transaction as an agent, the net transaction amount will be recognized as revenue.

In any of the following circumstances, the Company shall be the principal:

(A) the Company obtains control of the products or other assets from the other party before the products or other assets are transferred to the customers; or
(B) The Company controls the right to provide labor services by the other party, so as to obtain the ability to instruct that party to provide services to customers on behalf of the Company; or
(C) The Company obtains control of products or services from the other party to combine with other products or services to provide specific products or services to customers.
B. The indicators adopted to assist in judging whether the Company controls the specific products or services before transferring them to customers include (but not limited to):
(A) The Company is primarily responsible for fulfilling the commitment to provide specific products or services.
(B) The Company assumes inventory risk before and after the transfer of specific products or services to customers.
(C) The Company has the discretion to determine the price.
(3) Lease Period
When determining the lease period, the Company considers all relevant facts and circumstances that create economic incentives to exercise (or not exercise) the option, including all expected changes in facts and circumstances from the starting date to the date when the option is exercised. Factors considered include the terms and conditions of the contract for the period covered by the option, significant leasehold improvements made (or expected to be made) during the contract period, and the importance of the underlying asset to the Company's operations, among others. When major events or major changes in circumstances occur within the Company's control, the lease period shall be reassessed.
(4) Judgment of significant influence on affiliated enterprises
Situations where the investee holds less than 50% of the voting shares and is the single largest shareholder, but only has significant influence without control or joint control:
A. As stated in Note (6)10 "Investments Accounted for Using Equity Method", the Company holds 44.76% of the voting rights of SUNNY LOGISTICS CO., LTD. and is the single principal shareholder of SUNNY LOGISTICS CO., LTD. However, the decision-making unit of SUNNY LOGISTICS CO., LTD.’s relevant activities is the board of directors, and the Company has not been elected as a director of SUNNY LOGISTICS CO., LTD., and hence it cannot instruct the business decision-making. Therefore, the Company only has significant influence but no control over SUNNY LOGISTICS CO., LTD., so it is listed as an affiliated enterprise of the Company.
B. As stated in Note (6)10 "Investments Accounted for Using Equity Method", the Company holds 44.91% of the voting rights of LILY CONSTRUCTION CO., LTD. and is the single principal shareholder of LILY CONSTRUCTION CO., LTD. However, the decision-making unit of LILY CONSTRUCTION CO., LTD.’s relevant activities is the board of directors, and the Company has not been elected as a director of LILY CONSTRUCTION CO., LTD., and hence it cannot instruct the business decision-making. Therefore, the Company only has significant influence but no control over LILY CONSTRUCTION CO., LTD., so it is listed as an affiliated enterprise of the Company.
C. As stated in Note (6)10 "Investments Accounted for Using Equity Method", the Company holds 46.27% of the voting rights of GIANTEX TEXTILE CORPORATION and is the single principal shareholder of GIANTEX TEXTILE CORPORATION. However, the decision-making unit of GIANTEX TEXTILE

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CORPORATION’s relevant activities is the board of directors, and the Company has not been elected as a director of GIANTEX TEXTILE CORPORATION, and hence it cannot instruct the business decision-making. Therefore, the Company only has significant influence but no control over GIANTEX TEXTILE CORPORATION, so it is listed as an affiliated enterprise of the Company.

Important accounting estimates and assumptions
(1) Revenue recognition
- Sales revenue is recognized when performance obligations are met by transferring control of goods or services to customers, net of estimated related sales returns, discounts and other similar allowances. These sales returns and discounts are estimated based on historical records and other known reasons, and the Company regularly reviews the rationality of the estimates.
(2) Impairment of financial assets
- Estimated impairments on accounts receivable, debt instrument investments and financial guarantee contracts are based on the Company's assumptions about default rates and expected loss rates. The Company considers historical experience, current market conditions and forward-looking information to formulate assumptions and select inputs for impairment assessments. If the actual future cash flow is less than expected, significant impairment losses may arise.
(3) Fair value measurement and evaluation process When there is no market quotation for the assets and liabilities measured by fair value in the active market, the Company will decide whether to outsource the valuation and determine the appropriate fair value evaluation technology according to relevant laws and regulations or based on judgments. If the level 1 input value cannot be obtained when estimating the fair value, the Company takes reference to the analysis of the investee's financial status and operating results, recent transaction prices, quotations of the same equity instruments in non-active markets, and quotations of similar instruments in active markets and comparable company valuation multiples, etc. to determined the input values. If the actual change in the input value in the future is different from the expectation, changes in fair value may occur.
- The Company regularly updates various input values according to market conditions to monitor whether the fair value measurement is appropriate.
(4) Impairment assessment of tangible and intangible assets In the process of asset impairment assessment, the Company needs to rely on subjective judgments and based on asset usage patterns and industry characteristics to determine the independent cash flow of a specific asset group, the duration of assets, and potential future income and expenses. Any change in estimates due to changes in economic conditions or the Company's strategy may result in material impairment in the future.
(5) Impairment testing of investment using the equity method When there is any indication of impairment that an investment using the equity method may have been impaired and hence the book value cannot be recovered, the Company immediately assesses the impairment of the investment. The Company evaluates the recoverable amount based on the discounted value of the expected future cash flow of the invested company or the discounted value of the expected cash dividend received and the future cash flow generated by disposing of the investment, and analyzes the rationality of the relevant assumptions.
(6) Realization of deferred tax assets
- Deferred income tax assets are only recognized when it is highly likely that there will be sufficient taxable income in the future for the use of deductible temporary differences. When assessing the realizability of deferred income tax assets, management must involve significant accounting judgments and estimates, including assumptions such as expected future sales revenue growth and profit margins, tax holidays, available income tax credits, and tax planning. Any changes in the global economic environment, industry environment, and laws and regulations may cause major adjustments to deferred income tax assets.
(7) Evaluation of inventory

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Since inventories shall be priced at the lower of cost and net realizable value, the Company will adopt judgment and estimation to determine the net realizable value of inventories on the date of balance sheet. The Company evaluates the amount of inventory due to normal wear and tear, obsolescence or of no market value on the date of balance sheet, and writes off the inventory cost to the net realizable value. (8) Calculation of net defined benefit liabilities

When calculating the present value of a defined benefit obligation, the Company will adopt judgment and estimation to determine the relevant actuarial assumptions on the date of balance sheet, including the discount rate and the expected return rate of project assets. Any change in actuarial assumptions may significantly affect the amount of the Company's defined benefit obligations.

(VI) Contents of Significant Accounts

1. Cash and cash equivalents

Items Cash Checking deposits Demand deposit Foreign currency deposits Total	December 31,2022 $ 403 50,543 7,684 9,860 $ 68,490	December 31,2021 $ 339 69,921 8,243 65,754 $ 144,257

(1) The credit quality of the financial institutions that the Company interacts with is good, and the Company interacts with a number of financial institutions to diversify the credit risk, and the risk of default is expected to be very low.

(2) The Company has not pledged cash and equivalent cash.

Financial assets measured at fair value through other comprehensive income

Items Current: Equity instruments Domestic listed/OTC stocks Valuation adjustment Total Non-current: Equity instruments Domestic listed/OTC stocks Domestic non-listed/non-OTC stocks Subtotal Valuation adjustment Total	December 31,2022 $ 10,698 (4,874) $ 5,824 $ 22,885 76,224 99,109 54,137 $ 153,246	December 31,2021 $ 10,698 (4,695) $ 6,003 $ 22,885 63,276 86,161 39,375 $ 125,536

(1) The Company chooses to classify the investment in CHINA WIRE & CABLE CO., LTD., which receives stable dividends, as financial assets measured at fair value through other comprehensive income. The fair values of these investments on December 31, 2022 and 2021 were respectively NT$5,824 thousand and NT$6,003 thousand.

(2) The Company invests in the common stocks of EVERTEX FABRINOLOGY LTD. and other companies according to the medium and long-term strategic objectives, and expects to make profits through long-term investment. The Company's management level believes that if the short-term fair value fluctuations of these investments are included in profit or loss, it will be

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inconsistent with the aforementioned long-term investment plan, so it chooses to designate these investments to be measured at fair value through other comprehensive income.

(3) Please refer to Note (12) for the relevant credit risk management and assessment methods.
Notes receivable, net

Items Notes receivable Less: loss allowance Notes receivable, net	December 31,2022 $ 2,415 (13) $ 2,402	December 31,2021 $ 12,242 (13) $ 12,229

(1) The Company's notes receivable have not been discounted or pledged.

(2) Please refer to the following net accounts receivable for the relevant disclosure of allowance loss on notes receivable.

Accounts receivable, net

Items Accounts receivables Less: loss allowance Accounts receivable, net	December 31,2022 $ 60,436 (316) $ 60,120	December 31,2021 $ 53,167 (316) $ 52,851

(1) The Company's accounts receivable that are not overdue and have not been impaired all meet the credit standards set based on the counterparty's industrial characteristics, business scale, and profit-making status, and the average credit period is 90-120 days.

(2) Please refer to Note (12) for the relevant credit risk management and assessment methods.

(3) The Company's accounts receivable have not been pledged.
A. The Company adopts a simplified method to recognize the allowance loss of notes receivable and accounts receivable based on the expected credit loss during the duration. The expected credit loss during the duration is based on considering the customer's past default record and current financial and economic conditions, while considering the industry outlook to adjust the loss rate established by historical and realistic information. The Company measures the allowance loss of notes receivable and accounts (including other receivables, collections and related parties) according to the reserve matrix as follows:

December 31, 2022	Expected credit loss rate	Total carrying amount	Allowance for loss (lifetime expected credit loss)	Amortized cost
Not overdue Overdue 0-30 days Overdue 31-90 days Overdue for more than 91 days Total December 31, 2021	- 1% or above 5% or above 20% or above Expected credit loss rate	$ 1,082,346 - - 342,988	$ - - - 7,412	$1,082,346 - - 335,576
		$1,425,334	$ 7,412	$1,417,922
		Total carrying amount	Allowance for loss (lifetime expected credit loss)	Amortized cost
Not overdue Overdue 0-30 days Overdue 31-90	- 1% or above 5% or above	$ 979,588 - -	$ - - -	$ 979,588 - -

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days Overdue for more than 91 days 20% or above Total	310,667	7,412	303,255
	$1,290,255	$ 7,412	$1,282,843

B. Changes in notes receivable and allowance for receivables (including other receivables and collections) are as follows:

Beginning balance Add: Provision for impairment loss Less: Impairment loss reversed Less: Write-off due to inability to recover Foreign Currency Conversion Difference Ending balance	2022 $ 7,412 - - - - $ 7,412	2021
		$ 7,412 682 - ( 682) -
		$ 7,412

The Company does not hold any collateral or other credit enhancements over these accounts receivable.

(4) The Company's impairment losses on accounts receivable in 2022 and 2021 are respectively NT$0 thousand and NT$682 thousand.

5. Net other receivables

Items Proceeds receivable Other receivables - Others Tax refund receivable Less: loss allowance Net amount	December 31,2022 $ 315 4,257 2,734 (1,095) $ 6,211	December 31,2021 $ 281 4,366 - (1,095) $ 3,552

6. Inventory

Items WIP Finished goods Products Total	December 31,2022 $ 852 803 - $ 1,655	December 31,2021 $ 1,119 789 - $ 1,908

(1) Inventory-related (loss) gains recognized as cost of sales of products in the current period are as follows:

period are as follows:
Costs of sales of inventory Inventory price recovery benefit (loss) Warehousing costs Costs of transferring of the discontinued units Total operating costs	2022 $ 39,736 252 271,780 - $ 311,768	2021
		$ 128,714 ( 2,249) 221,293 ( 4,799)
		$ 342,959

(2) In 2022 and 2021, the Company raised the price of certain products and cleared some of the inventory, or reduced the cost to the net realizable value, and the

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benefits (losses) of inventory price recovery were respectively NT$(252) thousand and NT$2,249 thousand.

(3) The Company does not pledge the inventory.

Real estate and construction land

Items Houses and parking spaces for sale Construction land Total Less: Loss allowance for falling price Net amount	December 31,2022 $ 3,060 1,858 4,918 - $ 4,918	December 31,2021
		$ 3,060 1,858
		4,918 -
		$ 4,918

(1) The interest capitalization amount of the premises for sale and construction land in both 2022 and 2021 is NT$0 thousand.

(2) The Company does not pledge the real estate and construction land.

Non-current assets to be sold (net) and discontinued units

(1) On March 23, 2017, the Company was approved by the board of directors to discontinue the production at Pingzhen Cotton Factory and transfer the related assets and liabilities into the disposal group to be sold, which is expressed as a discontinued unit in line with the definition. The sale transaction of the disposal group to be sold was completed in June 2019.

(2) The cash flow information of the discontinued unit is as follows:

Cash flows from operating activities Cash flows from investing activities: Cash flows from financing activities: Total cash flow	2022 $ - - - $ -	2021
		($ 2,621) - -
		($ 2,621)

(3) Assets classified as disposal group for sale: None.

(4) Liabilities classified as disposal group for sale: None.

(5) Accumulated income or expenses recognized in other comprehensive profit or loss related to the disposal group classified as pending sale: None.

(6) The analysis of the operating results of the discontinued units and the results of re-measurement and recognition of assets or groups to be disposed of is as follows:

follows:
Profit or loss from operating Operating revenue Operating costs and operating expenses Pre-tax operating loss of discontinued units Income tax (expense) benefit After-tax operating loss of discontinued units (A) Disposal gains (loss) of assets of discontinued units and measurement gains (loss) based on net fair value Pre-tax asset disposal gains (loss) and net fair value measurement gains (loss) of discontinued units Income tax (expense) benefit Disposal gains (loss) of assets of discontinued units and measurement gains (loss) based on net fair value (B)	2022	2021
	$ - -	$ 3,925 ( 6,546)
	- -	( 2,621) -
	$-	($2,621)
	$ - -	$ - -
	-	-

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Loss of discontinued units (A ＋ B)

$ -

($ 2,621)

(7) Liabilities directly related to non-current assets to be sold: None.
Other financial assets - Current

Items December 31, 2022 December 31, 2021 Restricted time deposit $ 181,533 $ 178,253 (within one year)

Please refer to Note (8) for information on providing guarantees with other financial assets-liquidity.

10. Investment accounted for under the equity method

Investment subsidiary Investment affiliated enterprise Total	December 31,2022 $ 140,630 386,802 $ 527,432	December 31,2021 $ 143,742 338,780 $ 482,522

(1) Investment subsidiary
A. The Company's subsidiaries are listed as follows:

Investees	December 31, 2022	December 31, 2022	December 31, 2021	December 31, 2021
	Carrying amount	Shareholding %	Carrying amount	Shareholding %
GISONG ENTERPRISE CORPORATION LILYTEX INTERNATIONAL CORP. LILYTEX INTERNATIONAL CORP. MIGHTY BUSINESS LTD. Subtotal Add: Long-term equity investment loan balance transferred to other liabilities Total	$ 140,630 - ( 1,208,774) ( 45,666)	57.00 - 70.59 100.00	$ 143,731 11 ( 1,086,888) ( 41,168)	57.00 98.67 70.59 100.00
	( 1,113,810) 1,254,440		( 984,314) 1,128,056
	$140,630		$143,742

B. For information about the Company's subsidiaries, please refer to Note (4)3 of the Company's 2022 financial reports.
C. It is determined that the subsidiary LILYTEX INTERNATIONAL CORP. will be dissolved on October 1, 2021. The Company lost its significant influence on the subsidiary from that day on and ceased the application of the equity method. LILYTEX INTERNATIONAL CORP. was liquidated on June 13, 2022.
(2) Investment affiliated enterprise:
A. The Company's investment affiliated enterprises are listed as follows:

Investees	December 31,2022	December 31,2022	December 31,2021	December 31,2021
	Carrying amount	Shareholding %	Carrying amount	Shareholding %
SUNNY LOGISTICS CO., LTD. LILY CONSTRUCTION CO., LTD. GIANTEX TEXTILE CORPORATION Total	$ 200,500 173,411 12,891	44.76 44.91 46.27	$ 159,899 172,180 6,701	44.76 44.91 46.27
	$ 386,802		$ 338,780

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B. The Company sold 2,800 thousand shares of GIANTEX TEXTILE CORPORATION in November 2021. After the sale, the shareholding was reduced to 46.27%. The Company hence lost control over GIANTEX TEXTILE CORPORATION from that day but maintained significant influence, and it will be classified as an affiliated enterprise.
C. The shares of individual insignificant affiliated enterprises of the Company are summarized as follows:

are summarized as follows:
2022 Share: Net income $ 10,696 Other comprehensive income or loss (net after taxes) 37,326 Total comprehensive income $48,022	2021
	$ 146,434 44,113
	$190,547

11. Property, plant and equipment

roperty, plant and equipment
Items Land Buildings Machine and equipment Other equipment Equipment to be inspected and unfinished projects Total costs Less: Accumulated depreciation and impairment Total	December 31,2022 $ 1,957,963 1,797,211 19,607 839,836 290,050 4,904,667 ( 644,091) $ 4,260,576	December 31,2021
		$ 1,957,963 1,765,151 19,607 820,013 103,257
		4,665,991 ( 570,838)
		$ 4,095,153

Costs	Land	Buildings	Machine and equipment	Other equipment	Equipment to be inspected and unfinished projects	Total
	$ 1,957,963 - - -	$ 1,765,151 3,295 ( 11,906) 40,671	$ 19,607 - - -	$ 820,013 12,989 - 6,834	$ 103,257 229,992 - (43,199)	$ 4,665,991 246,276 ( 11,906) 4,306
Balance as of January 1, 2022 Addition Disposal Reclassification Balance as of December 31, 2022 Accumulated depreciation and impairment
	$ 1,957,963	$ 1,797,211	$ 19,607	$ 839,836	$ 290,050	$ 4,904,667
	$ - - - -	$ 321,052 53,924 ( 11,906) -	$ 19,605 - - -	$ 230,181 31,235 - -	$ - - - -	$ 570,838 85,159 ( 11,906) -
Balance as of January 1, 2022 Depreciation Disposal Reclassification Balance as of December 31, 2022
	$ -	$ 363,070	$ 19,605	$ 261,416	$ -	$ 644,091

Equipment to Machine and Other Land Buildings be inspected Total equipment equipment and unfinished

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Costs					projects
	$ 1,957,963 - - -	$ 1,325,583 17,061 ( 6,536) 429,043	$ 19,607 - - -	$ 622,817 7,700 ( 663) 190,159	$ 341,108 255,866 - (493,717)	$ 4,267,078 280,627 ( 7,199) 125,485
Balance as of January 1, 2021 Addition Disposal Reclassification Balance on 2021.12.31 Accumulated depreciation and impairment
	$ 1,957,963	$ 1,765,151	$ 19,607	$ 820,013	$ 103,257	$ 4,665,991
	$ - - - -	$ 289,989 37,598 ( 6,535) -	$ 19,605 - - -	$ 204,912 25,931 ( 662) -	$ - - - -	$ 514,506 63,529 ( 7,197) -
Balance as of January 1, 2021 Depreciation Disposal Reclassification Balance on 2021.12.31
	$ -	$ 321,052	$ 19,605	$ 230,181	$ -	$ 570,838

(1) The additions in this period and the cash flow acquisition of property, plant and equipment are adjusted as follows:

equipment are adjusted as follows:
Items Increase of property, plant and equipment Increase (decrease) of payable equipment fees Cash paid for purchase of property, plant and equipment	2022 $ 246,276 ( 5,450) $ 240,826	2021
		$ 280,627 2,286
		$ 282,913

(2) The property, plant and equipment of the Company are mainly for self-use purposes.
(3) In 2022 and 2021, the capitalized amounts of unfinished construction and prepaid equipment interests of property, plant and equipment were NT$2,593 thousand and NT$4,146 thousand, respectively.
(4) There is no sign of impairment of property, plant and equipment, so impairment assessment has not been carried out.
(5) As of December 31, 2022 and 2021, due to legal restrictions, the Company is not yet able to register in the name of the Company, and the land temporarily registered in the name of the individual is NT$9,691 thousand. However, in order to ensure the rights and interests, the guarantee notes that the Company has obtained are all NT$19,506 thousand.
(6) Please refer to Note (8) for information on providing guarantees with property, plant and equipment.

12. Lease agreements

(1) Right-of-use assets

agreements ight-of-use assets
Items December Transportation equipment Other equipment Total costs Less: Accumulated depreciation ( Total $ Costs Transportation	December	31,2022 December 31,2021 9,442 7,831 - 2,273 9,442 10,104 1,525) ( 8,931) 7,917 $ 1,173 Other Total	December 31,2021
				7,831 2,273
	(			10,104 ( 8,931)
	$			$ 1,173
				Total

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	equipment	equipment
Balance as of January 1, 2022 Increase this period De-recognition of this period Balance as of December 31, 2022 Accumulated depreciation and impairment	$ 7,831 9,442 ( 7,831)	$ 2,273 - ( 2,273)	$ 10,104 9,442 ( 10,104)
	$ 9,442	$ -	$ 9,442
	Transportation equipment	Other equipment	Total
Balance as of January 1, 2022 Depreciation De-recognition of this period Allocation (reversal) of impairment loss Balance as of December 31, 2022 Costs	$ 6,744 2,612 ( 7,831) -	$ 2,187 86 ( 2,273) -	$ 8,931 2,698 ( 10,104) -
	$ 1,525	$ -	$ 1,525
	Transportation equipment	Other equipment	Total
Balance as of January 1, 2021 Increase this period De-recognition of this period Balance on 2021.12.31 Accumulated depreciation and impairment	$ 7,831 - -	$ 2,273 - -	$ 10,104 - -
	$ 7,831	$ 2,273	$ 10,104
	Transportation equipment	Other equipment	Total
Balance as of January 1, 2021 Depreciation De-recognition of this period Allocation (reversal) of impairment loss Balance on 2021.12.31	$ 4,134 2,610 - -	$ 1,713 474 - -	$ 5,847 3,084 - -
	$ 6,744	$ 2,187	$ 8,931

(2) Lease liabilities Items Carrying amount of the lease liability Current Non-current	December 31,2022 $ 3,124 $ 4,819	December 31,2021
		$ 1,197
		$ -

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The discount rate range for the lease liability is as follows:

Items	December 31,2022	December 31,2021
Transportation equipment	1.37%~1.61%	1.61%
Other equipment	1.62%~1.74%	1.62%~1.74%
For the maturity analysis of lease liabilities, please refer		to Note (12)2.

(3) Important lease activities and terms

The Company leases some other equipment for use as business office. The lease period is from 2018 to 2025, with the right to renew the lease upon expiration of the lease period. The Company has included the lease renewal right after the lease period expires into the lease liabilities. In addition, according to the contract, without the consent of the lessor, the Company is not allowed to sublease the subject asset of the lease to others. As of December 31, 2022, there was no sign of impairment of the right-of-use asset, so no impairment assessment was performed.

(4) Other information on the leases

A. In 2021 and 2020, the Company chose to apply the recognition exemption for short-term leases and low-value asset leases, and did not recognize the relevant right-of-use assets and lease liabilities for these leases.

B. The Company's lease information is as follows:

Items Expenses relating to short-term leases Low-value asset lease expenses Variable payment profit not included in lease liability measurement Lease cash outflow amount (Note)	2022 $- $134 $- ($2,891)	2021
		$-
		$453
		$-
		($ 3,659)

(Note): It includes the principal payment of lease liabilities in the current period.

13. Other non-current assets

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Items Advance payment for equipment Refundable deposits Collection items Less: Allowance for losses - Collections Long-term accounts receivable - Related parties Long-term prepayments Total	December 31,2022 $ 26,449 11,512 5,988 ( 5,988) 337,000 2,066 $ 377,027	December 31,2021
		$ 5,425 10,912 5,988 ( 5,988) 304,679 4,890
		$ 325,906

For information about long-term accounts receivable - related parties, please refer to Note (7).

14. Short-term borrowings

hort-term borrowings
Type of borrowings Mortgage loan Type of borrowings Mortgage loan	December 31,2022
	Amount Interest rate $ 185,000 1.7%-1.83% December 31,2021	Interest rate
	Amount $ 100,000	Interest rate
		1.20%

For short-term loans, the company provides some other financial assets and real estate, plant and equipment as guarantees for loans, please refer to Note (VIII).

15. Allowance for liabilities - Current

Items Employee benefits Items Balance as of January 1 Increased allowance for liabilities for the current period Allowance for liabilities for in the current period Balance as of December 31	December 31,2022 $ 3,018 2022 Employee benefits $ 2,736 3,018 ( 2,736) $ 3,018	December 31,2021
		$ 2,736
		2021
		Employee benefits
		$ 2,414 2,736 ( 2,414)
		$ 2,736

Allowance for employee benefit liabilities is the valuation of employees' existing short-term leave entitlements.

16. Long-term loans and long-term liabilities due within one year

Loaning institutions	Maturity date	December 31, 2022	December 31, 2021	Repayment method Explanation (1) Explanation (2)
SUNNY BANK SUNNY BANK	2027.12.30 2028.06.18	$ 510,000 597,000	$ 570,000 600,000

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SUNNY BANK 2024.06.18 JihSun Bank 2031.01.15 Taiwan Business Bank 2024.01.06 Taiwan Business Bank 2024.03.02 Total Less: Long-term liabilities maturing within one year Long-term borrowings Interest rate	400,000 745,000 250,000 530,000	490,000 Explanation (3) 755,000 Explanation (4) 250,000 Explanation (5) 530,000 Explanation (6) 3,195,000 ( 120,000) $ 3,075,000 1.20%～1.31%
	3,032,000 ( 132,000)
	$2,900,000
	1.75%～1.83%

(1) The Company borrowed the mid- and long-term loan of NT$600,000 thousand from SUNNY BANK. The repayment method is starting the repayment each month (regarded as one installment) from December 30, 2020 for a consecutive 84 installments, and it repays the interest only for the first to sixth installments, and from the seventh to the 83rd installments repays NT$5,000 thousand in each installment, and the remaining NT$215,000 thousand will be paid off in lump-sum manner in the 84th installment.
(2) The Company borrowed the mid- and long-term loan of NT$600,000 thousand from SUNNY BANK. The repayment method is starting the repayment each month (regarded as one installment) from June 18, 2021 for a consecutive 84 installments, and it repays the interest only for the first to 24th installments, and from the 25th to the 83rd installments repays NT$1,000 thousand in each installment, and the remaining NT$541,000 thousand will be paid off in lump-sum manner in the 84th installment.
(3) The Company borrowed a mid- and long-term loan of NT$514,000 thousand from the SUNNY BANK. The repayment method is repayment in lump-sum manner on January 6, 2024.
(4) The Company borrowed the mid- and long-term loan of NT$800,000 thousand from JihSun Bank. The repayment method is starting the repayment each three months (regarded as one installment) from January 15, 2022 for a consecutive 36 installments, and it repays the amount of NT$15,000 thousand for each installments, and the remaining principal of NT$275,000 thousand will be paid off in lump-sum manner.
(5) The Company borrowed a mid- and long-term loan of NT$250,000 thousand from the Taiwan Business Bank. The repayment method is repayment in lump-sum manner on January 6, 2024.
(6) The Company borrowed a mid- and long-term loan of NT$530,000 thousand from the Taiwan Business Bank. The repayment method is repayment in lump-sum manner on March 2, 2024.
(7) The Company provides some other financial assets and property, plant and equipment as guarantee for loans, please refer to Note (8) for details.

17. Pension

(1) Defined contribution plan

A. The pension system of the "Labor Pension Act" applicable to the Company is a defined pension contribution plan managed by the government, and 6% of the employee's monthly salary is allocated to the individual account of the Bureau of Labor Insurance.
B. In 2022 and 2021, the amount that shall be allocated in accordance with the specified proportion in the definite distribution plan has been recognized in

- 164 -

the profit and loss statement as a total of NT$2,878 thousand and NT$2,318 thousand, respectively.

(2) Defined-benefits plan
A. The pension system of Taiwan's "Labor Standards Act" applicable to the Company is a defined pension benefit plan managed by the government. The payment of employee pensions is calculated based on the years of service and the average salary of the six months before the approved retirement date. These companies allocate 4% of the total monthly salary of the employees to the employee pension fund, which is deposited in the designated account of the Bank of Taiwan under the name of the Supervisory Committee of Business Entities’ Labor Retirement Reserve. Before the end of the year, if the balance in the estimated special account is insufficient to pay the workers who are expected to meet the retirement conditions in the next year, the difference will be allocated before the end of March of the next year. The designated account is entrusted to the Bureau of Labor Funds of the Ministry of Labor for management, and the Company has no right to instruct the investment management strategy.
B. The amount of the Company's obligations arising from the defined benefit plan included in the parent company only balance sheet is as follows:

Items Defined benefit obligation Fair value of plan assets Net confirmed benefit debt	December 31,2022 ($ 20,177) 2,930 ($ 17,247)	December 31,2021
		($ 17,968) 1,269
		($ 16,699)

C. Changes in defined benefit liabilities are presented as follows:

Items		2022
	Present value of defined benefit plan obligations	Fair value of plan assets	Net confirmed benefit debt
Balance as of January 1 Service costs Current period service costs Interest Expense (Income) Previous period service costs Liquidation loss (gain) Deferred tax income (expense) recognized in profit or loss Remeasurement number Return on project assets (except for the amount included in net interest) Actuarial (profit) loss- Impact from changes in demographic assumptions Impact from changes in financial assumptions Experience adjustment Deferred tax income (expense) recognized in other comprehensive income Contributions by employer Number of benefit payments on the account Number of benefit payments	($ 17,968)	$ 1,269	($ 16,699)
	( 71) ( 86) - -	- 11 - -	( 71) ( 75) - -
	( 157)	11	( 146)
	- - 299 ( 2,351)	100 - - -	100 - 299 ( 2,351)
	( 2,052)	100	( 1,952)
	- - -	1,550 - -	1,550 - -

- 165 -

Balance as of December 31 Items	($20,177)	$2,930	($17,247)
		2021
	Present value of defined benefit plan obligations	Fair value of plan assets	Net confirmed benefit debt
Balance as of January 1 Service costs Current period service costs Interest Expense (Income) Previous period service costs Liquidation loss (gain) Deferred tax income (expense) recognized in profit or loss Remeasurement number Return on project assets (except for the amount included in net interest) Actuarial (profit) loss- Impact from changes in demographic assumptions Impact from changes in financial assumptions Experience adjustment Deferred tax income (expense) recognized in other comprehensive income Contributions by employer Number of benefit payments on the account Number of benefit payments Balance as of December 31	($ 17,678)	$ 1,431	($ 16,247)
	( 70) ( 68) - -	- 7 - -	( 70) ( 61) - -
	( 138)	7	( 131)
	- - 115 ( 1,349)	13 - - -	13 - 115 ( 1,349)
	( 1,234)	13	( 1,221)
	- - 1,082	900 - ( 1,082)	900 - -
	($17,968)	$1,269	($16,699)

D. The Company is exposed to the following risks due to the pension system of the "Labor Standards Act":

(A) Investment risk

The Bureau of Labor Funds of the Ministry of Labor invests labor pension funds in domestic (foreign) equity securities, debt securities, and bank deposits through self-use and entrusted operation methods, however, the distribution amount of the Company's planned assets is not lower than the income calculated from the local bank's 2-year time deposit interest rate.

(B) Interest rate risk

(C) Salary risk

E. The present value of the Company's defined benefit obligations is calculated by a certified actuary. Significant assumptions at the measurement date are listed below:

Measurement date Items December 31, 2022 December 31, 2021

- 166 -

Discount rate Growth of future salary Determining the average due period of benefit obligation	1.70% 2.00% 11年	0.48%
		1.00%
		12年

(A) The assumptions for the future mortality rate are estimated based on the empirical life expectancy table of the Taiwanese life insurance industry in 2021.
(B) If there are reasonably possible changes in major actuarial assumptions, and all other assumptions remain unchanged, the amount that will increase (decrease) the present value of the defined benefit obligation is as follows:

Items Discount rate Increase 0.5% Decrease 0.5% Expected rate of salary increase Increase 0.25% Decrease 0.25%	December 31,2022 ($ 609) $ 648 $ 313 ($ 305)	December 31,2021 ($ 578) $ 591 $ 297 ($ 289)

F. The Company expects to pay NT$1,200 thousand and NT$900 thousand to the pension plan in 2023 and 2022, respectively.

18. Other non-current liabilities

Other non-current liabilities
Items Long-term investment credit balance (Note) Guarantee deposits Total	December 31,2022 $ 1,254,440 57,630 $ 1,312,070	December 31,2021
		$ 1,128,056 42,672
		$ 1,170,728

Note: Please refer to Note (6)10.

19. Capital

(1) The adjustments to the number and amount of ordinary shares outstanding at the beginning of the period and at the end of the period are as follows:

2022	2022	2021	2021
Number of shares (thousand)	Amount	Number of shares (thousand)	Amount
135,343	$ 1,353,430	135,343	$ 1,353,430
135,343	$ 1,353,430	135,343	$ 1,353,430

(2) As of December 31, 2022 and 2021, the Company's authorized capital is NT$3,530,000 thousand. The paid-in capital on December 31, 2022 and 2021 was both NT$1,353,430 thousand, and 135,343 thousand shares were issued.
Capital surplus

Items December 31, 2022 December 31, 2021

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Changes in recognized ownership interests in subsidiaries

$ 701 $ 701

Retained earnings
(1) According to the Articles of Incorporation, annual surpluses concluded by the Company are first subject to taxation and making up for previous losses, followed by a 10% provision for legal reserves; however, no further provision is needed when legal reserves have accumulated to the same amount as the Company's paid-in capital. Any surpluses remaining shall then be subject to provision or reversal of special reserves, as the laws. The residual balance (if any) can then be added to undistributed earnings carried from previous years per board resolution, and the shareholder meeting resolved to distribute shareholder bonus shares.
(2) The legal reserve shall not be used except for making up the company's losses and issuing new shares or cash in proportion to the shareholders' original shares. However, the issue of new shares or cash shall be limited to the portion of the reserve exceeding 25% of the paid-in capital.
(3) Special reserve
- A. When the Company distributes the surplus, according to laws and regulations, the special reserve shall be withdrawn from the debit balance of other equity items on the balance sheet date of the current year before the distribution. Later when the debit balance of other equity items is reversed, the reversed amount may be included in the distributable surplus.
- B. When adopting IFRSs for the first time, according to official latter Jin Guan Zheng Fa Zi No. 1010012865 dated April 6, 2012, the special reserve of NT$580,567 thousand was provided, if the Company subsequently uses, disposes or reclassifies the relevant assets, the proportion of the original special surplus reserve will be reversed to the distributable retained surplus. In June 2018, the shareholders' meeting resolved to use the special reserve to make up for the loss of NT$580,567 thousand. For any fiscal year with surplus thereafter, before the reason for the allocation of special reserve is eliminated, the shortfall shall be supplemented before the surplus can be distributed.
(4) The Company's profit distribution plan for 2022 and 2021 was proposed by the board of directors in March 2023 and the resolution of the shareholders' meeting was reached in June 2022. There are no distribution matters because there are still losses to be made up in both years.
(5) For information on the profit distribution proposed by the board of directors and resolutions of the shareholders' meeting, please visit the official site of "MOPS" of TWSE.

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22. Others

Others
Items	Exchange differences on translation of foreign operations	Unrealized gain or loss on financial assets measured at fair value through other comprehensive income	Real estate revaluation appreciation	Total
Balance as of January 1, 2022 Exchange differences arising from the translation of financial statements of foreign operating institutions Share of other comprehensive profit and loss of affiliated enterprises and joint ventures recognized using the equity method Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income Balance as of December 31, 2022 Items	$ 98,839 ( 15,215) - -	$ 86,467 - 37,326 14,583	$ 503,632 - - -	$ 688,938 ( 15,215) 37,326 14,583
	$ 83,624	$138,376	$ 503,632	$ 725,632
	Exchange differences on translation of foreign operations	Unrealized gain or loss on financial assets measured at fair value through other comprehensive income	Real estate revaluation appreciation	Total
Balance as of January 1, 2021 Exchange differences arising from the translation of financial statements of foreign operating institutions Share of other comprehensive profit and loss of affiliated enterprises and joint ventures recognized using the equity method Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income Balance on 2021.12.31	$ 105,771 ( 6,932) - -	$ 40,378 - 44,113 1,976	$ 503,632 - - -	$ 649,781 ( 6,932) 44,113 1,976
	$ 98,839	$ 86,467	$ 503,632	$ 688,938

23. Treasury stocks

(1) The situation of the company's repurchase of issued and outstanding shares: None.
(2) The changes in the number of shares of the company held by relevant subsidiaries in the current period are summarized as follows: 2022: None

022: None
Name of subsidiaries			2021
	Number at the beginning of the period		Increase this period		Decrease this period		Number at the end of the period
	Number of Shares	Amount	Number of Shares Amount		Number of Shares	Amount	Number of Shares Amount
GIANTEX TEXTILE CORPORATION 461 thousand shares		$ 9,056	-	$ -	461 thousand shares	$ 9,056	-	$ -

(3) Subsidiaries holding shares of the Company and enjoying the distribution of dividends, but having no voting rights.
The Company sold 2,800 thousand shares of GIANTEX TEXTILE CORPORATION in November 2021. After the sale, the shareholding was reduced to 46.27%. The Company hence lost control over GIANTEX TEXTILE CORPORATION from that day. In accordance with IAS 32, the application of treasury stocks shall cease.

24. Operating revenue

Items 2022 2021 Revenue from customer contracts Sales revenue $ 37,704 $ 118,717

- 169 -

Logistics revenue Total	540,255 $ 577,959	413,297
		$ 532,014

(1) Breakdown of revenue by contract with customers

The Company's income is mainly derived from products and services transferred at a certain point in time, and income can be further divided into the following major products:

following major products:
Product type Logistics Others Total	2022 $ 540,255 37,704 $ 577,959	2021
		$ 413,297 118,717
		$ 532,014

(2) Contract balance

Product type Logistics Others Total ontract balance	2022 $ 540,255 37,704 $ 577,959	2021 $ 413,297 118,717 $ 532,014
Contract liabilities - sales of goods	December 31,2022 $ 1,637	December 31,2021
		$ 3,025

A. Significant changes in contract assets and contract liabilities: None.
B. The contract liabilities at the beginning of the period and the previously satisfied performance obligations recognized as revenue in 2022 and 2021 were NT$3,025 thousand and NT$3,141 thousand, respectively.
C. Unfulfilled customer contracts

As of December 31, 2022, the Company's unfulfilled customer contracts for the sale of products or services are expected to last for less than one year, and are expected to be performed within the next year and recognized as revenue.

(3) Additional costs for obtaining contracts: None.
(4) The cost of fulfilling the contract: None.

25. Employee benefits, depreciation, depletion and amortization expenses

Type		2022
	Operating costs	Operating expenses	Total
Employee benefits expense Payroll expenses Labor and health insurance Pension costs Directors' remuneration Other employee benefits expense Depreciation Amortization expenses Total	$ 44,907 4,061 1,946 - 2,607 85,106 5,157	$ 24,954 2,063 1,078 1,260 796 2,751 23	$ 69,861 6,124 3,024 1,260 3,403 87,857 5,180
	$ 143,784	$ 32,925	$ 176,709

Type		2021
	Operating costs	Operating expenses	Total
Employee benefits expense

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Payroll expenses Labor and health insurance Pension costs Directors' remuneration Other employee benefits expense Depreciation Amortization expenses Total	$ 33,603 3,045 1,434 - 1,879 63,865 5,010	$ 21,538 1,620 1,015 1,120 936 2,748 24	$ 55,141 4,665 2,449 1,120 2,815 66,613 5,034
	$ 108,836	$ 29,001	$ 137,837

(1) Additional information on the number of employees and employee benefit expenses of the Company in 2022 and 2021 is as follows:

Number of Employees The number of directors who do not serve concurrently as employees Average employee benefits expense Average employee salary expense Adjustment of average employee salary expense Supervisor remuneration	2022	2021
	103 3 $ 824 $ 699 5.27% $200	85
		2
		$ 784
		$ 664
		(5.14%)
		$240

(2) The Company has set up an Audit Committee to replace the supervisors in June 2022 in accordance with the Securities and Exchange Act of the Republic of China, which is composed of all independent directors. Therefore, there has been no related remuneration for the supervisors since June 2022.
(3) According to the Company's Articles of Association, if there is any profit in the year, no less than 3% of such profit shall be allocated as employee remuneration, and the board of directors will determine to distribute it in the form of stock or cash, and those qualified for receiving the distribution include employees of affiliated enterprises who meet certain conditions; Proposals on the distribution of employee remuneration and director remuneration shall be reported to the shareholders' meeting.
However, if the Company still has accumulated losses, it shall reserve the compensation amount in advance, and then allocate employee remuneration and director remuneration in proportion based on the preceding Paragraph.
(4) In 2022 and 2021, there were losses yet to be made up, and there was no payment plan for employee remuneration and director and supervisor remuneration. Therefore, it is estimated that both employee remuneration and director and supervisor remuneration are NT$0. If there is any discrepancy between the actual distribution amount and the estimated amount as determined by the board of directors, it will be regarded as a change in accounting estimate and listed as profit or loss for the next year.
(5) In March 2023 and 2022, the board of directors resolved to distribute NT$0 for employee remuneration and director and supervisor remuneration for 2022 and 2021, which is no different from the employee remuneration and director and supervisor remuneration recognized in the financial reports.

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(6) For information about the Company's employee remuneration and director and supervisor remuneration, please visit the official site of MOPS of TWSE.
(7) Salary and remuneration policies for directors, managerial officers and employees:
A. The Company's policy, standards and combination of remuneration paid to directors, procedures for determining remuneration, and its relationship with business performance and future risks:
- (A) According to the Articles of Association of the Company, the directors of the Company may enjoy the traveling expenses on a monthly basis regardless of the Company's profit or loss, and the Remuneration Committee is authorized to determine the amount. The remuneration of chairman and directors is authorized at board meetings based on their level of participation in and contribution to the Company's operation. The remuneration follows the standards among the industry peers.
- (B) The Company's Articles of Association also stipulate that if the Company ahs any profits in any year, no more than 3% shall be allocated by the board of directors as remuneration for directors.
B. The Company's policy, standards and combination of remuneration paid to managerial officers, procedures for determining remuneration, and its relationship with business performance and future risks: The amount of remuneration given to the managerial officers of the Company is based on their duties, contributions, the Company's annual operating performance, and the Company's future development, which shall be reviewed by the Remuneration Committee and submitted to the board of directors for resolution.
C. The Company's policy, standards and combination of remuneration paid to employees, procedures for determining remuneration, and its relationship with business performance and future risks:
- (A) The remuneration of the Company's employees is based on personal ability, position, contribution to the Company and performance, and the Company's future development and industry standards as the payment standards.
- (B) According to the Company's Articles of Association, if there is any profit in the year, no less than 3% of such profit shall be allocated as employee remuneration, and the board of directors will determine to distribute it in the form of stock or cash, and those qualified for receiving the distribution include employees of affiliated enterprises who meet certain conditions.

26. Others

Others
Items Dividend income Rental income Others Total Other gains and losses Items	2022 $ 1,115 11 52 $ 1,178 2022	2021 $ 1,615 32 204 $ 1,851 2021


		($ 18,071)

27. Other gains and losses

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Loss of investments disposed of	(	1)			(	4,921)	4,921)
Gain on disposal of property, plant and equipment		-				1,205
Others	(	1,472)			(		995)
Total	$	134,088			($	22,782)
28. Finance costs
Items	2022				2021
Interest expense:
Bank loan	$	49,065			$	41,320
Interest on lease liabilities		61					41
Others		122					161
Less: The capitalized amount of assets meeting the requirements	(	2,593)			(	4,146)
Finance costs	$	46,655			$	37,376
29. Income tax
(1) Components of income tax expense:
Items		2022			2021
Income tax payable for the current year			$	-		$	-
Deferred income tax related to temporary
difference and loss credit				-			-
Income tax adjustments of previous year				-		(	2)
Surtax on unappropriated retained earnings				-			-
Basic income tax payable				-			-
Income tax recognized in profit for the year	current		$	-		($	2)
(2) The tax amount calculated by multiplying the income tax expense					and the pre-tax
net profit by the statutory tax rate is adjusted as follows:
Items		2022			2021
Income before income tax		$ 225,446			$	222,185
Net profit before tax is calculated according to the statutory tax rate $			45,089		$ 44,437
Tax impact of adjustment:
Amounts impacted by items that are not included in the calculation of taxable income ( 45,089)					(	44,437)
Income tax adjustments of previous year				-		(	2)
Net change in deferred tax
Loss deduction				-			-
Temporary difference				-			-
Income tax recognized in profit			$	-	($		2)
The applicable tax rate of the Income Tax Act of the Republic of China is							20%,
and the applicable tax rate of undistributed earnings is			5%.

(3) Income tax assets or liabilities arising from temporary differences, loss deduction and investment deduction:

2022 Beginning Recognized Recognized in Items Ending balance balance in (losses) other

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gains comprehensive (losses) gains

		gains	comprehensive (losses) gains
Deferred tax liabilities: Temporary difference Land value increment tax Items	($ 370,231)	$ -	$ -	($ 370,231)
		2021
	Beginning balance	Recognized in (losses) gains	Recognized in other comprehensive (losses) gains $ -	Ending balance ($ 370,231)
Deferred tax liabilities: Temporary difference Land value increment tax	($ 370,231)	$ -

(4) Items not recognized as deferred income tax assets

Items Temporary differences which may be deducted Loss deduction Total	December 31,2022 $ - 37,324 $ 37,324	December 31,2021
		$ 13,506 78,829
		$ 92,335

The final deduction period for deduction of unrecognized losses is from 2024 to 2028.

(5) The Company's profit-seeking income tax has been approved by the tax collection unit until 2020.

30. Other comprehensive income

Other comprehensive income
Items		2022
	Pre-tax amount	Income tax (expense) benefit	Net income after tax
Not to be reclassified to profit or loss in subsequent periods: Remeasurements of defined benefit plans Equity measured at fair value through other comprehensive income Unrealized valuation gains and losses on instrument investment Profit and loss of subsidiaries, associates and joint ventures recognized by using equity method Subtotal To be reclassified to profit or loss in subsequent periods: Exchange differences on translation of foreign operations Deferred tax income (expense) recognized in other comprehensive income Items	($ 1,952) 14,583 37,326	$ - - -	($ 1,952) 14,583 37,326
	49,957	-	49,957
	( 15,215)	-	( 15,215)
	$ 34,742	$ -	$ 34,742
		2021
	Pre-tax amount	Income tax (expense) benefit	Net income after tax

Not to be reclassified to profit or loss in subsequent

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($ 1,221) 1,976 44,113	$ - - -	($ 1,221) 1,976 44,113
44,868	-	44,868
( 6,932)	-	( 6,932)
$ 37,936	$ -	$ 37,936
2022

31. Basic earnings per share

32. Reconciliation for liabilities arising from financing activities

January 1, 2022	Cash flow		Non-	cashchange			December 31, 2022
		Changes in acquisition of subsidiary	Change in loss of control of a subsidiary	Changes in exchange rates	Changes of fair value	Other non-cash changes
$ 100,000 3,195,000 1,197 42,672	$ 85,000 $ - ( 163,000) - ( 2,696) - 14,958 -		$ - - - -	$ - - - -	$ - - - -	$ - - 9,442 -	$ 185,000 3,032,000 7,943 57,630
$ 3,338,869	($ 65,738) $ -		$ -	$ -	$ -	$ 9,442	$ 3,282,573
January 1, 2021	Cash flow		Non-	cashchange			December 31, 2021
		Changes in acquisition of subsidiary	Change in loss of control of a subsidiary	Changes in exchange rates	Changes of fair value	Other non-cash changes
$ 2,477,000 600,000 4,362 17,382	($ 2,377,000) 2,595,000 ( 3,165) 25,290	$ - - - -	$ - - - -	$ - - - -	$ - - - -	$ - - - -	$ 100,000 3,195,000 1,197 42,672
$ 3,098,744	$ 240,125	$ -	$ -	$ -	$ -	$ -	$ 3,338,869

(VII) Related-Party Transactions

Name and nature of relationship of the related parties

Name of the related parties Relationship with the Company

MIGHTY BUSINESS LTD Subsidiary LILY NETWORK CORP. Subsidiary GISONG ENTERPRISE CORPORATION Subsidiary Kunshan Lily Textile Co., Ltd. Second-tier subsidiary

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Name of the related parties Relationship with the Company LILY CONSTRUCTION CO., LTD. Associates GREEN DEFENSE CO., LTD. Other related party Lily Freight Co., Ltd. (Note) Other related party

Note: The original name was Lily Logistics Development Co., Ltd., and it was renamed in November 2021.

2. Significant transactions with the related parties

(1) Costs

osts
Accounting item	Type/Name of related parties	2022	2021
Import Warehousing costs	Other related party Other related party	$ -	$ 102
		$ 1,066	$ 998

The transaction conditions for purchasing goods with the above-mentioned related parties are the same as those for general non-related parties.

(2) Revenue

evenue
Accounting item	Type/Name of related parties	2022	2021
Sales revenue Logistics revenue	Subsidiary Other related party	$ -	$ 8
		$ 13,993	$ 8,038

The transaction conditions for the sales of goods with the above-mentioned related parties are 60 to 75 days, and the calculation of the price is the same as that of ordinary non-related parties.

(3) Property transactions: None.

(4) Various fees: None.

(5) Various income

arious fees: None. arious income
Type/Name of related parties	2022		2021		Type of transaction
Subsidiary	$	-	$	17	Rental income
Associates		11		14	Rental income
Subsidiary		3		-	Others
Second-tier subsidiary		2,953		2,684	Interest income
Total	$	2,967	$	2,715
losing balance of accounts receivable (payable)
Type/Name of related parties		December 31,	2022	December 31, 2021
Accounts receivables
Other related party		$	2,701		$ 1,828

(6) Closing balance of accounts receivable (payable)

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Type/Name of relatedparties	December 31,2022	December 31,2021
Other receivables (including long-term receivables) MIGHTY (Notes A and C) Kunshan Lily (Notes B and C) Total Less: loss allowance Net amount	$ 370,398 812,228	$ 334,305 732,369
	1,182,626 -	1,066,674 -
	$ 1,182,626	$ 1,066,674

A. It is the price that the Company sold machinery and equipment to Kunshan Lily Textile Co., Ltd. through MIGHTY BUSINESS LTD. in 2002 and 2001.

The details of the price of the sale of machinery and equipment are as follows:

follows:
Summary	Price receivable	Sale date
Sell the equipment of Pingzhen Second Factory Sell the equipment of Pingzhen Third Factory Sale of ordered machinery and equipment	USD 6,100 thousand USD 5,254 thousand USD 165 thousand	September 2001 December 2001 August 2002

The above-mentioned payment method for the sale of machinery and equipment is to pay monthly in 24 installments after Kunshan Lily Textile Co., Ltd. has installed and commissioned the machinery and passed the inspection. As of December 31, 2022 and 2021, the recovered funds were USD1,110 thousand and USD1,077 thousand, respectively. The remaining unrecovered funds are USD10,321 thousand, EUR88 thousand, USD10,354 thousand, and EUR88 thousand, equivalent to NT$320,057 thousand and 288,921 thousand, respectively. Due to the macro-control of the mainland China and the Company is still having operating losses, the Company has postponed the recovery of the amount through the resolution of the board of directors, and has decided to collect interest until the end of 2020, and has suspended interest calculation since 2021. As of December 31, 2022 and 2021, the interest receivables were equivalent to NT$50,341 thousand and NT$45,384 thousand, respectively, and the interest income for both 2022 and 2021 was NT$0 thousand.

B. On December 31, 2022 and 2021, the Company's accounts receivable from the related party Kunshan Lily Textile Co., Ltd. exceeded the normal credit period of NT$795,285 thousand and NT$716,611 thousand, respectively, which have been transferred to other receivables.

Its aging is as follows:

(A) December 31, 2022

ferred to other receivables. ing is as follows: cember 31, 2022
Other receivables Long-term accounts receivable - Machinery Total	More than 90 days
	$ 795,285 16,943
	$ 812,228

(B) December 31, 2021

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Other receivables Long-term accounts receivable - Machinery Total	More than 90 days
	$ 716,611 15,758
	$ 732,369

C. For the accounts between the Company and related parties Kunshan Lily Textile Co., Ltd. and MIGHTY BUSINESS LTD., the Company was established to meet market demand and the Company's operating objectives, however, the operating conditions of Kunshan Lily Textile Co., Ltd. and MIGHTY BUSINESS LTD. were not as ideal as expected and they were unable to repay the outstanding accounts as scheduled, the Company has fully recognized the loss of the original equity of its shareholders within the scope of its legal obligations, constructive obligations and payments on its behalf. As of December 31, 2022 and 2021, the equity method is adopted for accounting the balance of investment loans, which were NT$1,254,440 thousand and NT$1,128,056 thousand, respectively.

Type/Name of related

parties Notes payable and accounts Other related party Type/Name of related parties Other payables Associates Other related party Total	December 31, 2022 $ 152 December 31, 2022 $ 11 199 $ 210	December 31, 2021 $ 48 December 31, 2021 $ 6 90 $ 96

(7) Others

thers
Type/Name of related parties Payment on behalf of others Kunshan Lily	December 31, 2022 $1,747	December 31, 2021
		$1,747

(8) Financing A. Ending balance Type/Name of related parties Kunshan Lily Kunshan Lily	(8) Financing A. Ending balance Type/Name of related parties Kunshan Lily Kunshan Lily	Accounting item	December 31, 2022	December 31, 2021
	Kunshan Lily Kunshan Lily	Other receivables Interest receivable	$ 153,650	$ 138,450
			$ 10,212	$ 7,259

B. Interest income

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Type/Name of related parties	2022	2021 $ 2,684 2.00%
Kunshan Lily Interest rates	$ 2,953
	2.00%

(9) Endorsement and guarantee

The details of the endorsement provided by the Company for borrowing from the bank for related parties are as follows:

Type/Name of related parties Kunshan Lily	December 31, 2022	December 31, 2021 RMB 41,000 thousand
	RMB 41,000 thousand

(10) Guarantee notes

In order to ensure the creditor's rights and land ownership, the Company received the guarantee notes from related parties as follows:

Type/Name of related

yp parties Kunshan Lily Major Management Level	December 31, 2022 RMB 196,000 thousand USD 5,000 thousand $ 19,506	December 31, 2021 RMB 196,000 thousand USD 5,000 thousand $ 19,506

3. Salary information of major management level

Type/Name of relatedparties Salary and other short-term employee benefits Post-employment benefits Total	2022 $ 7,156 - $ 7,156	2021
		$ 6,844 -
		$ 6,844

(VIII) Pledged Assets

The following assets have been provided as collateral for various borrowings and performance bonds:

performance bonds:
Items Other financial assets - Current Property, plant and equipment (Net) Total	December 31,2022 $ 181,533 3,487,484 $ 3,669,017	December 31,2021
		$ 178,253 3,164,580
		$ 3,342,833

(IX) Material Contingent Liabilities and Unrecognized Contractual Commitments
As of December 31, 2022 and 2021, the guarantee notes received by the Company for the purpose of endorsement of performance guarantees, guarantee of creditor's rights and land ownership, etc. reached NT$1,205,968 thousand in total, and are recorded in the accounts of guarantee notes and guarantee notes receivable.
As of December 31, 2022 and 2021, the Company's endorsement guarantee for Kunshan Lily Textile Co., Ltd. provides guarantee for bank loans with an amount of RMB41,000 thousand.
(X) Losses due to Major Disasters: None.

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(XI) Significant Subsequent Events: None.

(XII) Others

Capital risk management

The Company needs to maintain a large amount of capital to meet the needs of expansion and upgrading of plant and equipment. Therefore, the Company's capital management is to ensure that it has the necessary financial resources and operating plans to meet the needs of working capital, capital expenditures, research and development expenses, debt repayments and dividend payments in the next 12 months.

Financial instruments
(1) Financial risk of financial instruments

The daily operation of the Company is affected by various financial risks, including market risk (including exchange rate risk, interest rate risk, and price risk), credit risk and liquidity risk. In order to reduce related financial risks, the company is committed to identifying, assessing and avoiding market uncertainties, so as to reduce the potential adverse impact of market changes on the company's financial performance. The Company's important financial activities are reviewed by the board of directors in accordance with relevant regulations and internal control systems. During the execution of the financial plan, the company must strictly abide by the relevant financial operating procedures regarding overall financial risk management and division of powers and responsibilities.

A. Nature and extent of material financial risks
(A) Market risk
- a. Foreign exchange risk

The Company is exposed to exchange rate risk arising from sales, purchases and borrowing transactions and net investments in foreign operations that are not denominated in the respective functional currencies of the Company. These transactions are mainly denominated in US dollars and RMB. In order to avoid the decrease in the value of foreign currency assets and the fluctuation of future cash flow due to exchange rate changes, the Company uses foreign currency loans and derivative financial instruments (including forward exchange contracts and exchange interest contracts) to avoid exchange rate risks. The use of such derivative financial instruments can help the Company reduce but still cannot completely eliminate the impact of foreign currency exchange rate changes.

Since the net investment of foreign operating institutions is a strategic investment, the company does not hedge against it.

(a) Exchange rate exposure risk and sensitivity analysis

(Foreign Currency: Functional Currency) Financial assets	December 31, 2022	December 31, 2022	December 31, 2022
	Foreign currency	Exchange rate	Account amount (NTD)
	$ 29,338 349 266 41,414 270	30.73 32.80 33.23 4.42 30.73	$ 901,557 11,447 8,839 183,050 8,297
Monetary items
USD : NTD EUR : NTD CHF : NTD CNY : NTD Financial liabilities
Monetary items
USD : NTD

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December 31, 2021

		Account amount
Foreign currency	Exchange rate	(NTD)
(Foreign Currency:
Functional Currency)
Financial assets
Monetary items
USD : NTD $ 41,001	27.69	$ 1,135,318
EUR : NTD 349	31.29	10,920
CHF : NTD 266	30.18	8,028
CNY : NTD 41,000	4.34	177,940
Financial liabilities
Monetary items
USD : NTD 3,118	27.69	86,337
The sensitivity analysis of the company's exchange rate risk mainly
focuses on the major foreign currency monetary items and
non-monetary items on the end date of the financial reporting
period, and the impact of the	related	foreign currency
appreciation/depreciation on the company's profit and loss and
equity. The company's exchange rate risk is mainly affected by the
fluctuation of the US dollar exchange rate. When the US dollar
depreciates/appreciates 1%, the company's net		profit after tax in
2022 and 2021 will increase/decrease	by NT$7,146 thousand and
NT$8,392 thousand, respectively

b. Price risk

Since the investments held by the Company are classified as financial assets at fair value through other comprehensive income in the individual balance sheet, the Company is exposed to the price risk of equity instruments.

The Company mainly invests in domestic listed/OTC and non-listed/OTC equity instruments. The price of these equity instruments will be affected by the certainty of the future value of the investment target.

(a) The Company's interest rates on interest-bearing financial instruments on the reporting date are summarized as follows:

Items	Carrying amount	Carrying amount
	December 31, 2022	December 31, 2021
Fair value interest rate risk: Financial assets Financial liabilities Net amount Cash flow interest rate risk: Financial assets Financial liabilities Net amount	$ 181,533 -	$ 178,253 -
	$181,533	$178,253
	$ 17,544 ( 3,217,000)	$ 73,997 ( 3,295,000)
	($ 3,199,456)	($ 3,221,003)

(b) Sensitivity analysis of fair value interest rate risk:

The Company does not classify any fixed-rate financial assets and liabilities as financial assets measured at fair value through profit or loss and available for sale, nor does it designate derivatives (interest

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rate swaps) as hedging tools under the fair value hedging accounting model. Therefore, changes in interest rates on the reporting date will not affect profit or loss and other comprehensive net income.

(c) Sensitivity analysis of instruments with cash flow interest rate risk: The Company's financial instruments with variable interest rates are assets (debts) with floating interest rates. Therefore, changes in market interest rates will cause changes in effective interest rates, resulting in fluctuations in future cash flows. Every 1% increase in the market interest rate will reduce the after-tax net profit in 2022 and 2021 by NT$25,596 thousand and NT$25,768 thousand, respectively

(B) Credit risk

Credit risk refers to the risk that the counterparty of the transaction violates the contractual obligations and causes financial losses to the company. The company's credit risk mainly comes from receivables generated from operating activities, bank deposits and other financial instruments generated from investment activities. Operational credit risk and financial credit risk are managed separately.

a. Operation-related credit risk

b. Financial credit risk

The credit risk of bank deposits and other financial instruments is measured and monitored by the financial segment of the Company. Since the Company's transaction partners and other parties to the contract are all credit-worthy banks, financial institutions, corporate organizations, and government agencies with investment grades and above, there are no major doubts about the performance of the contract, so there is no major credit risk. In addition, the Company is not classified as an investment in debt instruments measured at fair value through other comprehensive profit or loss at cost after amortization.

(a) Credit concentration risk

As of December 31, 2022 and 2021, the accounts receivable balance of the top ten customers accounted for 68% and 78% of the Company's accounts receivable balance, respectively, and the credit concentration risk of the remaining accounts receivable was relatively insignificant.

(b) Measurement of expected credit impairment losses
Accounts receivable: simplified approach, please refer to Note (6)-4.

Basis for judging whether the credit risk has increased significantly: None. (In addition, the Company is not classified as an investment in debt instruments measured at fair value through other comprehensive profit or loss at cost after amortization)

  - (c) The financial assets held by the Company do not have any collateral or other credit enhancement protection to avoid the credit risk of financial assets.

C. Liquidity risk
a. Management of liquidity risk:

The goal of the Company's liquidity risk management is to maintain the cash and equivalent cash required for operations, highly liquid securities

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and sufficient bank financing lines, etc., so as to ensure that the company has sufficient financial flexibility.

b. Maturity analysis of financial liabilities

The following table summarizes the analysis of the Company's financial liabilities during the agreed repayment period according to the due date and undiscounted due amount:

Non-derivative financial instruments				December 31, 2022	December 31, 2022
	Within 6 months	6 to 12 months	1 to 2 years	2 to 5 years	More than 5 years	Contract cash flow	Carrying amount
Short-term borrowings Notes payable (including related parties) Accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including due in one year) Guarantee deposits Total	$ - 13,624 3,567 40,747 66,000 -	$ 185,000 - - - 66,000 -	$ - - - - 1,312,000 -	$ - - - - 606,000 -	$ - - - - 982,000 57,630	$ 187,646 13,624 3,567 40,747 3,195,991 57,630	$ 185,000 13,624 3,567 40,747 3,032,000 57,630
	$123,938	$251,000	$1,312,000	$606,000	$1,039,630	$3,499,205	$3,332,568

Derivative financial liabilities: None.

Further information on the lease liability maturity analysis is as follows:

		follows:
Lease liabilities	Less than 1 year	1-5 years	5-10 years	15-20 years	Over 20 years	Total undiscounted lease payments	Carrying amount
	$ 3,213	$4,869	$-	$-	$-	$ 8,082	$ 7,943

Non-derivative financial instruments				December 31, 2021	December 31, 2021
	Within 6 months	6 to 12 months	1 to 2 years	2 to 5 years	More than 5 years	Contract cash flow	Carrying amount
Short-term borrowings Notes payable (including related parties) Accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including due in one year) Guarantee deposits Total	$ - 8,208 29,893 32,766 60,000 -	$ 100,000 - - - 60,000 -	$ - - - - 186,000 -	$ - - - - 1,666,000 -	$ - - - - 1,223,000 42,672	$ 101,200 8,208 29,893 32,766 4,128,477 42,672	$ 100,000 8,208 29,893 32,766 3,195,000 42,672
	$130,867	$160,000	$186,000	$1,666,000	$1,265,672	$4,343,216	$3,408,539

Derivative financial liabilities: None.

Further information on the lease liability maturity analysis is as follows:

		follows:
Lease liabilities	Less than 1 year	1-5 years	5-10 years	15-20 years	Over 20 years	Total undiscounted lease payments	Carrying amount
	$1,200	$-	$-	$-	$-	$1,200	$1,197

The Company does not expect that the cash flow of maturity analysis will be significantly earlier, or the actual amount will be significantly different.

(2) Types of financial instruments

The book values of various financial assets and financial liabilities of the Company on December 31, 2022 and 2021 are as follows:

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Financial assets Financial assets measured at amortized cost Cash and cash equivalents Notes receivable and accounts (including related parties) Other accounts receivable - Related parties Other financial assets - Current Refundable deposits Unrealized gains and losses on equity investments measured at fair value through other comprehensive income Financial assets at fair Financial liabilities Financial liabilities at amortized cost Short-term borrowings Notes and accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including due in one year) Guarantee deposits	December 31, 2022 $ 68,490 65,233 1,015,699 181,533 11,512 159,070 185,000 17,191 40,747 3,032,000 57,630	December 31, 2021
		$ 144,257 66,908 911,256 178,253 10,912 131,539 100,000 38,101 32,766 3,195,000 42,672

Information of changes of fair value
(1) Please refer to Note (12)3(4) for the fair value information of the Company's financial assets and financial liabilities that are not measured at fair value.
(2) Three-level definition of fair value:

Level 1:

The input value of this level refers to the input parameter to measure the fair value which is not based on the observable input value available in the market.

(3) Financial instruments not measured at fair value

The Company's financial instruments that are not measured at fair value include cash and cash equivalents, notes receivable, accounts receivable, other receivables, other financial assets, deposits, short-term loans, notes payable, accounts payable, other carrying amounts of payables and deposits are reasonable approximations of fair values.

(4) Information of level of fair value:

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The Company's financial instruments measured at fair value are measured at fair value on a repeatable basis, while assets to be disposed are measured at the lower of book value and fair value less costs to sell on a non-repetitive basis. The Company's fair value grade information is shown in the table below:

Items		December 31, 2022	December 31, 2022
	Level 1	Level 2	Level 3	Total
Recurring fair value Financial asset measured at fair value through profit or loss Financial assets measured at fair value through other comprehensive income Total Items	$ - 18,557	$ - -	$ - 140,513	$ - 159,070
	$18,557	$-	$140,513	$159,070

	Level 1	Level 2	Level 3	Total
Recurring fair value Financial asset measured at fair value through profit or loss Financial assets measured at fair value through other comprehensive income Total	$ - 18,806	$ - -	$ - 112,733	$ - 131,539
	$18,806	$-	$112,733	$131,539

(5) Fair value evaluation techniques for instruments measured by fair value:
A. If there is a public quotation in an active market for a financial instrument, the public quotation in the active market shall be used as the fair value. The market prices announced by major exchanges and central government bond over-the-counter trading centers that are judged to be popular bonds are the basis for the fair value of listed (OTC) equity instruments and debt instruments with open quotations in active markets.

If the financial instruments held by the company have an active market, their fair values are listed as follows by category and attribute:

(A) Stocks of listed/OTC companies: closing price.
(B) Open-ended funds: net worth.
B. Except for the above-mentioned financial instruments with active markets, the fair value of other financial instruments is obtained by evaluation techniques or by referring to the quotations of counterparties. The fair value obtained through evaluation techniques can refer to the current fair value of other financial instruments with substantially similar conditions and characteristics, discounted cash flow method or other evaluation techniques, including the use of market information available on the consolidated balance sheet date. Calculated (for example, refer to the yield curve of the counter buying center, the average quotation of Reuters commercial paper interest rate).

The fair value of non-listed/OTC Company stocks held by the company without an active market is mainly estimated by the market method, and its judgment is based on evaluations of similar companies, third-party quotations, company net worth and operating conditions.

C. The evaluation of derivative financial instruments is based on evaluation models widely accepted by market users, such as discount method and option pricing model. Forward foreign exchange contracts are usually evaluated based on the current forward exchange rate.

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D. The Company incorporates credit risk assessment adjustments into the calculation of the fair value of financial instruments and non-financial instruments to reflect the counterparty's credit risk and the Company's credit quality respectively. (6) Transfer between Level 1 and Level 2: None.

(7) The detailed list of changes in the Level 3 (excluding non-repetitive fair value):

Items
January 1, 2022
Gains or losses recognized in profit or
loss for the period
Gain or loss recognized in other
comprehensive profit or loss
Transferred in this period
Acquisition this period
Disposal this period
Transferred to Level 3
Transferred from Level 3
December 31, 2022
Items
January 1, 2021
Gains or losses recognized in profit or
loss for the period
Gain or loss recognized in other
comprehensive profit or loss
Transferred in this period
Acquisition this period
Disposal this period
Transferred to Level 3
Transferred from Level 3
December 31, 2021

Equitysecurities186
$ 112,733
-
14,832
-
12,948
-
-
-
$ 140,513
Equitysecurities186
$ 106,350
-
2,346
-
4,037
-
-
-
$ 112,733

(8) Quantitative information on fair value measurement of significant unobservable inputs (Level 3):

inputs (Level 3):
Non-derivative financial assets Non-listed/OTC stocks Non-derivative financial assets Non-listed/OTC stocks	Fair value on December 31, 2022	Evaluation technique	Significant unobservable input value Lack of market liquidity discount Significant unobservable input value Lack of market liquidity discount	Interval (weighted average)	Relation between input value and fair value
	$ 140,513 Fair value on December 31, 2021	Market method Evaluation technique		25% Interval (weighted average)	The higher the discount due to lack of market liquidity, the lower the fair value Relation between input value and fair value
	$ 112,733	Market method		25%	The higher the discount due to lack of market liquidity, the lower the fair value

(9) The evaluation process of the fair value is classified into Level 3:

- 186 -

The Company's evaluation process for classifying the fair value into Level 3 is that the financing and accounting segment is responsible for verifying the fair value of financial instruments, using independent source data to make the evaluation results close to the market status, confirming that the data source is independent, reliable, and other data sources Consistent and representative executable prices, and regularly calibrate the evaluation model, conduct backtesting, update the input values and data required for the evaluation model, and make any other necessary fair value adjustments to ensure that the evaluation results are reasonable.

(10) Sensitivity analysis of fair value measurement of Level 3 and fair value to reasonable and possible alternative assumptions:

Input value	Change	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022
		Deferred tax income (expense) recognized in profit or loss		Deferred tax income (expense) recognized in other comprehensive income
		Favorable change	Unfavorable change	Favorable change	Unfavorable change
Current discount Input value	±1% Change	$ -	$ -	$ 1,871	($ 1,870)

		Deferred tax income (expense) recognized in profit or loss		Deferred tax income (expense) recognized in other comprehensive income
		Favorable change	Unfavorable change	Favorable change	Unfavorable change
Current discount	±1%	$ -	$ -	$ 1,530	($ 1,499)

(XIII) Additional Disclosures

Significant transactions information (including before writing-off)
(1) Financing provided to other: Please refer to Table 1.
(2) Endorsement/Guarantee provided to others: Please refer to Table 2.
(3) Those who hold securities at the end of the period: Please refer to Table 3.
(4) Acquisition or sale of the same security with the accumulated cost reaching NT$300 million or 20% of the Company's paid-in capital: None.
(5) Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
(6) Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
(7) Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more: None.
(8) Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more: see Table 4.
(9) Engaging in derivative commodity transactions: None.
Information on investees: Table 5.
Information on investments in China: Table 6
Information on major shareholders (names, shareholdings, and ratios of shareholders with a shareholding ratio of 5% or more): Table 7.

(XIV) Segment Information

The Company has disclosed the operating segment information in the consolidated financial report.

- 187 -

Table 1

Lily Logistics Development Co., Ltd. Financing activity for others December 31, 2022

No.	Name of financing provider	Name of counter party	Transaction items	Related party?	Maximum balance of the period	Balance (limit) at the end of period	Actual amount provided	Interest rates	Nature of financing activity	Amount of sales to (purchase from) counter-party	Reason for short-term financing	Allowance for loss accounts	Assets	pledged	Limit of financing amount for individual counter-party	Limit of total financing amount
													Name	Value
0	Lily Logistics Development Co., Ltd.	Kunshan Lily Textile Co., Ltd.	Other receivables	Yes	$ 158,900	$153,650	$153,650	2.00%	Sales to (purchase from) counter-party	$ -	Business operations	$ -	Guarantee notes	$157,510	Lily Logistics Development Co., Ltd.’s loan limit for individual objects shall not exceed 20% of the net equity value of NT$337,850 thousand in the latest financial statement certified by an accountant or reviewed	Lily Logistics Development Co., Ltd.’s loan limit shall not exceed 40% of the net equity value of NT$675,700 thousand in the latest financial statement certified by an accountant or reviewed
		MIGHTYBUSINESSLTD.	Long-term receivables	Yes	383,013	370,398	370,398	-	Sales to (purchase from) counter-party	-	Business operations	-	None	-

- 188 -

Table 2

Lily Logistics Development Co., Ltd.

Endorsement/Guarantee provided to others December 31, 2022

le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022	le 2 Lily Logistics Development Co., Ltd. Endorsement/Guarantee provided to others December 31, 2022
Unit: In Thousands of New Taiwan Dollars
No. (Note 1)	Name of endorsement and guarantee company	Endorsee		Endorsement limit for a single entity (Note 3)	Maximum balance for the period	Outstanding endorsement/guarantee balance	Actual amount provided	Amount of collateral guarantee/endorsement	Percentage of accumulated guarantee amount to net assets value from the latest financial statement	Ceiling on total amount of endorsements/guarantees provided (Note 4)	Guarantee provided by Parent Company	Guarantee provided by subsidiary	Provision of endorsements/guarantees to the party in China
		Company name	Relationship with the Company (Note 2)
0	Lily Logistics Development Co.,Ltd.	Kunshan Lily Textile Co.,Ltd.	3	$337,850	$ 185,320 (RMB 41,000)	$ 181,220 (RMB 41,000)	$ 181,220 (RMB 41,000)	RMB 41,000	10.73%	$844,625	Yes	No	Yes

Note 1: The description of the serial number column is as follows:

(1) Fill in 0 for the issuer.
(2) Invested companies are numbered sequentially starting from the Arabic numeral 1 according to the company.

Note 2: The relation between the endorser and the endorsed has the following 7 types, which can be marked:

(1) Companies with transaction relationship.
(2) Companies in which the Company directly or indirectly holds more than 50% of the voting shares.
(3) Companies that directly and indirectly hold more than 50% of the Company's voting shares.
(4) Between companies in which the Company directly and indirectly holds more than 90% of the voting shares.
(5) Based on the needs of contracting projects, companies in the same industry or between contractors and contractors are mutually endorsement according to the contract.
(6) The joint investment relation is a company that is endorsed and guaranteed by all shareholders in accordance with their shareholding ratio.

(7) Joint and several guarantees for performance guarantees of real estate pre-sale contracts among peers in accordance with the Consumer Protection Act. Note 3: The balance of the Company's and its subsidiaries' endorsements to a single enterprise shall not exceed 20% of the Company's net worth. Note 4: The calculation method of the maximum limit shall not exceed 50% of the net value of the Company's latest financial statement certified by an accountant or reviewed.

- 189 -

Table 3

Lily Logistics Development Co., Ltd.

Securities held at the end of the period (excluding the control part of subsidiaries, affiliates and joint ventures) December 31, 2022

			December 31, 2022
				Unit: 1,000 shares and NT$1,000
Names of companies held	Types and names of negotiable securities	Relationship with the securities issuer	Account Items	End of period
				Number of Shares	Book value	Ratio	Fair value measurement
Lily Logistics Development Co., Ltd.	Stock CHINA WIRE & CABLE CO., LTD. EVERTEX FABRINOLOGY LTD. LEAD DATA INC. FAIR FRIEND ENT.CO.,LTD. Excellence Electronic Co, Ltd. LEADWELL CNC MACHINES MFG.,CORP. CROWNPO TECHNOLOGY INC. MAXSPEED CORPORATION HUALON CORPORATION TYPHONE COMPANY LILYENT CORP. Sunny Bank Ltd. FAITH ALLIANCE CORPORATION	－－－－－－－－－－－－－	Financial assets measured at fair value through other comprehensive income - Current Financial assets measured at fair value through other comprehensive income - Non-current " " " " " " " " " " "	224 611 576 78 1 50 1 174 - 118 3,782 3,638 34	$ 5,824 11,113 1,620 2,070 20 1,331 22 - - - 82,252 54,757 61	- - - - - - - - - - - - -	$ 5,824 11,113 1,620 2,070 20 1,331 22 - - - 82,252 54,757 61

- 190 -

Table 4

Lily Logistics Development Co., Ltd.

Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more December 31, 2022

Company with accounts receivable	Name of counterparty of transaction	Relationship with the Company	Balance of receivables from related parties	Turnover	Overdue receivables from related parties	Overdue receivables from related parties	Amount of related parties recovered after the due date	Allowance for loss accounts
					Amount	Treatment method
Lily Logistics Development Co., Ltd.	MIGHTY BUSINESS LTD. (Note A)	Mutually parent company and subsidiary	$ 320,057	－	$ 320,057	－	As of the end date of the field work, not all of them have been recovered	$ - (Note C)
	Kunshan Lily Textile Co., Ltd.	Mutually parent company and sub-subsidiary	812,228	－	812,228	－	As of the end date of the field work, not all of them have been recovered	- (Note C)
MIGHTY BUSINESS LTD.	Kunshan Lily Textile Co., Ltd. (Note A)	Parent company	324,732	－	324,732	－	As of the end date of the field work, not all of them have been recovered	-

- 191 -

Table 5

Lily Logistics Development Co., Ltd. Re-investment related information (excluding invested companies in mainland China) December 31, 2022

Unit: 1,000 shares and NT$1,000

Name of the investors	Name of the investees	Location	Main business and products	Original / investment amount	Original / investment amount	Shares held as of the end of period	Shares held as of the end of period	Shares held as of the end of period	Net profit (loss) of the investee for the current period	Investment gains and losses recognized by the Company (Note 1)	Notes
				Ending balance of the period	End of last year	Number of Shares	Ratio	Carrying amount
Lily Logistics Development Co., Ltd.	LILY CONSTRUCTION CO., LTD.	Taiwan	1. Entrust construction companies to build commercial buildings and public housing for lease and sales businesses. 2. Entrust construction companies to develop industrial zones approved by industrial competent authorities. 3. Brokerage for house rental and sales. 4. Sales agency andreinvestmentof the above-mentionedrelated businesses.	$ -	$ -	2,695	44.91%	$ 173,411	$ 2,678	$ 1,231	Associates
	GIANTEX TEXTILE CORPORATION	Taiwan	1. Spinning and weaving of various fibers such as natural fibers, man-made fibers, and chemical fibers. 2. Printing, bleaching, dyeing and finishing of various fiber products. 3. General import and export trade (except futures) (except licensing business) 4. Entrust construction companies to develop industrial zones approved by industrial competent authorities. 5. Entrust construction companies to build commercial buildings and public housing for lease and sales businesses. 6. Design, manufacture and sales of computer system hardware and related software. 7. Import and export of computers and related electronic components. 8. Sales agency andreinvestmentof the above-mentionedrelated businesses.	309,981	309,981	26,818	46.27%	12,891	11,444	5,295	Associates
	GISONG ENTERPRISE CORPORATION	Taiwan	Spinning of yarn	114,000	114,000	11,400	57.00%	140,630	9,560	5,449	Subsidiary
	LILYTEX INTERNATIONAL CORP.	Taiwan	Various food and beverages, cosmetics, medicines, batteries, toys, information software, electrical appliances and business machines	-	44,400	-	-	-	-	-	(註2)
	SUNNY LOGISTICS CO., LTD.	Taiwan	Logistics	99,211	99,211	7,803	44.76%	200,500	9,316	4,170	Associates
	LILYTEX INTERNATIONALCORP.	BVI	Based on the instructions of the parent company's operating policies to reinvest in various businesses outside Taiwan	419,541	419,541	12,600	70.59%	(1,208,774)	( 151,114)	( 106,671)	Subsidiary
	MIGHTYBUSINESS LTD.	BVI	Based on the instructions of the parent company's operating policies to reinvest in various businesses outside Taiwan	35	35	1	100.00%	( 45,666)	( 4,498)	( 4,498)	Subsidiary

- 192 -

Table 6

Lily Logistics Development Co., Ltd. Information on investments in China December 31, 2022

						December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022	December 31, 2022
(1) Content Name of the invested companies in the mainland China Main business and products Total amount of paid-in capital Method of investment (Note 1) Accumulated amount of remittance from Taiwan to China at the ~~b~~eginning of the current period Kunshan Lily Textile Co., Ltd. Warehousing and leasing USD 24,782 (II) $ 419,511 (USD 12,600)
	Name of the invested companies in the mainland China	Main business and products	Total amount of paid-in capital	Method of investment (Note 1)	Accumulated amount of remittance from Taiwan to China at the ~~b~~eginning of the current period	Investment flows		Accumulated amount of remittance from Taiwan to China at the end of the current period	Ownership held by the Company (direct or indirect)	Net profit (loss) of the investee for the current period	Investment (loss) gain recognized for the current period (Note 2)	Carrying value at end of year	Accumulated amount of investment income remitted back as of the end of this period
						Outward remittance	Recovery
	Kunshan Lily Textile Co., Ltd.	Warehousing and leasing	USD 24,782	(II)	$ 419,511 (USD 12,600)	$ -	$ -	$ 419,511 (USD 12,600)	55.21%	($ 193,216)	($ 151,114) (II)2	($ 1,396,695)	$ -

Note 1: The investment methods are divided into the following three types, and the type of type can be marked:

(I) Directly to the mainland China to engage in investment.
(II) Reinvest in the mainland China through companies in the third region.
(III) Subsidiaries reinvested and established in mainland China.

Note 2: In the current period recognized investment profit and loss column:

(I) If it is under preparation and there is no investment profit or loss, it should be indicated.
(II) The recognition basis of investment profit and loss is divided into the following three types, which shall be specified.
Financial statements audited by an international accounting firm that has a cooperative relationship with the accounting firm of the

Republic of China.

The financial statements audited by CPA of the parent company in Taiwan.
Preliminary statement.

Note 3: Relevant figures in this Table shall be denominated in NTD.

- 193 -

Name of the invested companies in the mainland China	Accumulated amount of remittance from Taiwan to China as of the end of theperiod	Investment amounts authorized by Investment Commission, MOEA	Ceiling on investments in China imposed by the Investment Commission of MOEA
Kunshan Lily Textile Co., Ltd.	$ 419,511	USD 12,600	$ 1,013,549

(2)Significant transactions with invested companies in mainland China that occurred indirectly through third-region enterprises: For the major transactions between the company and its mainland investee companies directly or indirectly in 2022, please refer to the "Information on Material Transactions" and the consolidated financial report "Business Relationship between Parent and Subsidiary Companies and Important Transactions".

- 194 -

Table 7

Lily Logistics Development Co., Ltd. Information of principal shareholders December 31, 2022

(Unit: 1,000 shares)

		(Unit: 1,000 shares)
Shares Name of Main Shareholders	Number of Shares Held	Percentage of ownership
SUNNY LOGISTICS CO., LTD.	13,267	9.80%
RITER SHUN TRADING COMPANY LIMITED	12,120	8.95%
Xin RongInvestment Co., Ltd.	10,140	7.49%
YishengInvestment Co., Ltd.	8,987	6.64%
Su, Chin-Yuan	8,074	5.96%
SU, HAO-YI	7,101	5.24%

6.6 If the Company and Its Affiliates Encounter Any Financial Difficulties in the Past Year and as of the Date of Publication of the Annual Report, the Impact on the Company’s Financial Status Shall Be Listed: None

- 195 -

VII. Review of Financial Conditions, Financial Performance, and Risk Management

7.1 Analysis of Financial Status

Comparative Statement of Financial Position

nalysis of Financial Status Comparative Statement of Financial Position	nalysis of Financial Status Comparative Statement of Financial Position	nalysis of Financial Status Comparative Statement of Financial Position	nalysis of Financial Status Comparative Statement of Financial Position	nalysis of Financial Status Comparative Statement of Financial Position
Unit: NT$ thousands
Year Item	2021	2022	Difference
			Amount	%
Current assets	731,367	595,350	(136,017)	(18.60)
Fixed assets	5,666,191	5,910,194	244,003	4.31
Total assets	6,397,558	6,505,544	107,986	1.88
Current liabilities	1,499,357	1,578,435	79,078	5.27
Fixed liabilities	3,719,035	3,588,982	(130,053)	(3.50)
Total liabilities	5,218,392	5,167,417	(50,975)	(0.98)
Interests attribute to parent company owner	1,429,061	1,689,249	260,188	18.21
Capital stock	1,353,430	1,353,430	0	0
Capital surplus	701	701	0	0
Retained earnings	(614,008)	(390,514)	223,494	36.40
Other adjustments	688,938	725632	36,694	5.33
Treasury stock	0	0	0	0
Non-controlling interests	(249,895)	(351,122)	(101,227)	(40.51)
Total stockholders’ equity	1,179,166	1,338,127	158,961	13.48

Note 1: Retained earnings differences: mainly due to net income in 2022.

196 -

7.2 Analysis of Financial Performance

Analysis of Financial Performance

Year Item	2021	2022	Amount Difference	Ratio Difference (%)
Net operating revenue	866,817	847,500	(19,317)	(2.23)
Operating costs	(609,797)	(501,431)	(108,366)	(17.77)
Gross profit (loss)	257,020	346,069	89,049	34.65
Operating expenses	(74,926)	(100,240)	(25,314)	33.79
Operating net profit (loss)	182,094	245,829	63,735	35.00
Non-operating income and expenses	32,529	(99,364)	(131,893)	(405.46)
Loss from continuing operations before tax	214,623	146,465	(68,158)	(31.76)
Tax expense	(7,868)	(3,452)	(4,416)	(56.13)
Net income of continuing business units (loss)	206,755	143,013	(63,742)	(30.83)
Loss of suspended business unit after tax	(2,621)	0	2,621	100.00
Net profit (loss)	204,134	143,013	(61,121)	(29.94)
Other comprehensive net income	32,312	22,398	(9,914)	(30.68)
Total of other comprehensive income	236,446	165,411	(71,035)	30.04)
Net income attributable to stockholders of the parent	222,187	225,446	3,259	1.47
Net income attributable to non- controlling interests	(18,053)	(82,433)	(64,380)	(356.62)
Total comprehensive income attributable to stockholders of the parent	260,123	260,188	65	0
Total comprehensive income attributable tonon-controllinginterests	(23,677)	(94,777)	(71,100)	(300.29)

Note: 1. Operating net profit (loss): mainly due to the increase in warehouse rental and handling income.

Non-operating income and expenses: mainly due to the higher amount of subsidiaries, affiliates, and joint ventures recognized under the equity method in 2021.
Other comprehensive net income: mainly due to an increase in the negative exchange differences resulting from the translation of financial statements of foreign operating institutions in 2022.

7.3 Analysis of Cash Flow

7.3.1 Cash Flow Analysis for the Most Current Two Fiscal Year

Year Item	2021	2022	Variance (%)
Cash flow ratio (%)	16.54	20.61	24.61
Cash flow adequacy ratio (%)	-	17.33	0
Cash reinvestment ratio (%)	5.06	6.61	30.63

197 -

7.3.2 Liquidity Analysis of Cash Flow for The Fiscal Year

Estimated Cash and Cash Equivalents, Beginning of Year	Net Cash Flow from Operating Activities	Cash Outflow (Inflow)	Cash Surplus (Deficit)	Remedy for Cash Shortage	Remedy for Cash Shortage
				Investment Plans	Financing Plans
144,257	347,943	(423,710)	68,490	-	144,257

A. Net cash inflow was mainly due to the increase in net operating profit.
B. Financing activities: Net cash outflow was mainly due to repayment of long-term loans.

7.3.3 Estimated Remedy for Cash Shortage and Flow Analysis: Not applicable

7.3.4 Cash Flow Analysis for the Coming Year

Estimated Cash and Cash Equivalents, Beginning of Year	Estimated Net Cash Flow from Operating Activities	Estimated Cash Outflow (Inflow)	Estimated Cash Surplus (Deficit)	Remedy for Cash Shortage	Remedy for Cash Shortage
				Investment Plans	Financing Plans
68,490	452,310	(438,160)	82,640	-	-

  - A. Operating activities: Cash inflow for 2023 is expected to be mainly due to the increase in sales revenue.

  - B. Financing activities: Cash outflow for 2023 is expected to be mainly due to the repayment of long-term loans.

  - C. Investing activities: Cash outflow for 2023 is expected to be mainly due to the payment for new plant and equipment.

7.4 Impact of Major Capital Expenditure in the Past Year on the Financial Status: the Company is constructing the third phase of warehouse building in 2022 and is expected to be fully operational in 2025, which will provide greater benefits to the Company’s earnings.
7.5 Reinvestment Policy in the Past Year, the Main Reason for Its Profit or Loss, the Improvement Plan and Investment Plan in the Next Year:
7.5.1 The Company has no reinvestment plan in the past year.
7.5.2 The Company has terminated the operations of the departments that incurred losses in its parent and subsidiary companies. Due to the parent company’s continued profitability in recent years, the Company still maintains a surplus after tax in 2022.
7.6 Analysis of Risk Management in the Past Year and as of the Date of Publication of the Annual Report are as follow:
7.6.1 Effects of Changes in Interest Rates, Foreign Exchange Rate and Inflation on Corporate Finance, and Future Response Measures:
- Since the Company makes repayments and interest payments in accordance with contracts and has good interaction with banks, interest rates are kept low. The additional storage buildings in Pingzhen District have been operational since 2021, resulting in no significant increase in interest expenses for the Company. Regarding exchange rate fluctuations, the Company will hedge foreign exchange risks in accordance with the “Financial Derivatives Trading Procedure” if necessary. As for inflation, neither the Company nor its subsidiaries have experienced any significant impact on their operations in the region in 2022.
7.6.2 Policies, Main Causes of Gain or Loss and Future Response Measures with Respect to High-risk, High-leveraged Investments, Lending or Endorsement Guarantees, and Derivatives Transactions:

The Company does not engage in high-risk, high-leveraged investments. As for lending

198 -

funds to other parties and providing endorsement guarantees, the Company obtains guarantees in the form of promissory notes for the same amount. Derivative financial instruments are operated primarily for hedging purposes, and all operations are carried out prudently after careful consideration of the risk profile. 7.6.3 Research and Development Programs, Current Progress of Incomplete Research and Development Programs, Additional Research and Development Expenses Required, Expected Time of Completion for Mass Production, and Main Factors that May Affect the Success of Research and Development in the Future: None

7.6.4 Effects of and Response to Changes in Policies and Regulations Relating to Corporate Finance and Sales: None
7.6.5 Effects of and Response to Changes in Technology and the Industry Relating to Corporate Finance and Sales: None
7.6.6 The impact of Changes in Corporate Image on Corporate Risk Management, and the Company’s Response Measures: None
7.6.7 Expected Benefits from, Risks Relating to and Response to Merger and Acquisition Plans: None
7.6.8 Expected Benefits from, Risks Relating to and Response to Factory Expansion Plans: The recent construction of our warehouse building was based on prior contracts with customers and started only after an actuarial calculation to ensure increased profitability. Therefore, there is no possibility of any risk.
7.6.9 Risks Relating to and Response to Excessive Concentration of Purchasing Sources and Excessive Customer Concentration:
The Company purchases goods from different firms to increase bargaining power, and sells goods to different firms individually, so there is no risk of concentrated sales.
7.6.10 Effects of, Risks Relating to and Response to Large Share Transfers or Changes in Shareholdings by Directors, Supervisors, or Shareholders with Shareholdings of over 10%: None
7.6.11 Effects of, Risks Relating to and Response to the Changes in Management Rights: None
7.6.12 Litigation or Non-litigation Matters:
(1) Major ongoing lawsuits, non-lawsuits or administrative lawsuit: None
(2) Major ongoing lawsuits, non-lawsuits or administrative lawsuit caused by directors, supervisors or shareholders with over 10% shareholdings: None
7.6.13 Other Major Risks and Response
Analysis of network security assessment:

The Company uses genuine software on each personal computer, and anti-virus software is fully installed. Data is regularly backed up, and independent software is used for finance and accounting. The computer software company regularly inspects and maintains the software, and the data is also regularly backed up and archived. For warehousing and logistics, we use firewall hardware equipment for internal and external network defense to ensure information security. We also purchase attack protection functions to prevent attacks on network lines. As a protective measure, we update virus codes on system serves through automatic network connections with anti-virus software. We regularly maintain and check the system every month. The Company has a firewall function for external network connections, so there is no risk in terms of information technology.

7.7 Other Important Matters: None

199 -

VIII. Special Disclosure

8.1 Information about the Company’s Affiliates

8.1.1 Organization Chart of the Affiliates

			Lily Logistics	Development Co., LTD.
				│
	┌─────────┬────────┬─────────┬───────────┐
持	LILYTEX CORP.	集 INTERANTIONAL	持集松股松股比實比率業率 70.59 % (股)57% 公公司司 CORPORATION Shareholding 57% Gisong Enterprise Corporation	強持立持益股益股紡比建比織率設率 (股) 46.27%事業公(股)業司公司 Shareholding 44.91% Lily Arch. Co., Ltd. Shareholding 46.27% GIANTEX TEXTILE	44.91% LOGISTICS CO., LTD.	三持立股物比流率 (股)44.76% 公司 Shareholding 44.76% SUNNY

8.1.2 Basic Data of the Company’s Affiliates:

Name	Date of incorporation	Address	Paid-in capital	Main business items
Gisong Enterprise Corporation	09/07/1998	7F., No. 70, Xining N. Rd., Datong Dist., Taipei City, Taiwan (R.O.C.)	$200,000,000	Various of long and short fibered covered yarn
GIANTEX TEXTILE CORPORATION	05/26/1986	7F., No. 70, Xining N. Rd., Datong Dist., Taipei City, Taiwan (R.O.C.)	$579,550,000	Dyeing, drying, setting, and brushing for all kinds of fabrics, as well as OEM services of polar fleece
Lily Arch. Co., Ltd	06/19/1991	7F., No. 70, Xining N. Rd., Datong Dist., Taipei City, Taiwan (R.O.C.)	$60,000,000	Construction, leasing, and selling of commercial buildings and public housing
LILYTEX INTERANTIONAL CORP.	08/23/2000	B.V.I.	$824,993,000	To make investment in various businesses outside of Taiwan based on the parent company’s management policy instructions.
SUNNY LOGISTICS CO., LTD.	10/24/2013	7F., No. 70, Xining N. Rd., Datong Dist., Taipei City, Taiwan (R.O.C.)	$174,341,000	International trade, warehousing, leased estate, tally packaging

8.1.3 Information of the Same Shareholders who are Presumed to have a Controlling and Subsidiary Relationship

Unit: NT$ thousands; Shares; %

Reason that affiliation is presumed	Name (Note 1)	Shareholding (Note 2)	Shareholding (Note 2)	Date of incorporation	Address	Paid-in capital	Main business items
		Shares	%
Same chairman as the Company	Gisong Enterprise Corporation	11,400,000	57.00%	09/07/1998	7F., No. 70, Xining N. Rd., Datong Dist., Taipei City, Taiwan (R.O.C.)	20,000,000	Various of long and short fibered covered yarn

Note 1: If the shareholders are the same as legal entities, fill in the name of the legal entity; if the shareholders are the same as natural persons, fill in the name of the natural person. For natural shareholders, only fill in the reason for presumption, name and the shares held.

Note 2: Shareholdings shall be fill in the shareholder’s shareholding information of the controlling company.

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8.1.4 Status of Operations of the Company’s Affiliates

Unit: NT$ thousands

Name	Paid-in capital	Total assets	Total liabilities	Net income	Operating revenue	Operating profit	Profit and loss (after tax)	Earnings per share (after tax)
Gisong Enterprise Corporation	200,000	318,137	71,418	246,719	220,046	11,755	9,560	0.48
GIANTEX TEXTILE CORPORATION	579,550	156,276	127,781	28,495	0	(67)	11,444	0.20
Lily Arch. Co., Ltd.	60,000	391,659	5,467	386,192	4,442	(66)	2,678	0.45
SUNNY LOGISTICS CO., LTD.	174,341	749,714	301,769	447,945	15,826	7,411	9,316	0.53

Note 1: All affiliated companies, regardless of size, shall be disclosed.

Note 2: If the affiliated company is a foreign company, the relevant figures shall be presented in New Taiwanese Dollars and converted using the exchange rate as of the reporting date.

8.1.5 The Information of the Directors, Supervisors, and General Manager of each

Affiliate

Name	Title	Name or representative	Shareholding	Shareholding	Remark
			Shares	%
Gisong Enterprise Corporation	Chairman	SU TUNG YUNG	150,000	0.75%
	Director & General Manager	SU CHING SUNG	2,300,000	11.50%	Representative of Shing Shoun Fiber Co.,Ltd.
	Director	SU CHIN YUAN	75,000	0.38%
	Director	SHAO YING	500,000	2.50%
	Director	WANG CHIEN CHUNG	11,400,000	57%	Representative of Lily Logistics Development Co.,Ltd
	Supervisor	CHIEN HUA CHUAN	0	0%
GIANTEX TEXTILE CORPORATION	Chairman	SU CHIN YUAN	1,601,866	2.76%
	Director	SU TING KUEI	339,433	0.59%
	Director	SU TING HUNG	484,999	0.84%
	Supervisor	CHIEN HUA CHUAN	26,817,816	46.27%	Representative of Lily Logistics Development Co.,Ltd
LilyArch. Co.,Ltd	Chairman	SU TING HUNG	108,378	1.81%
	Director	YANG SHU MIEN	62,633	1.04%
	Director	CHIEN HUA CHUAN	18,544	0.31%
	Supervisor	SU HAO I	26,888	0.45%
SUNNY LOGISTICS CO.,LTD.	Chairman	SU TING HUNG	810,000	4.64%
	Director	SU HAO I	810,000	4.64%
	Director	SU PAI HUANG	677,096	3.88%
	Supervisor	CHIEN HUA CHUAN	7,802,903	44.76%	Representative of Lily Logistics Development Co.,Ltd

8.2 Private Securities in the Past Year and as of the Date of Publication of the Annual Report: None
8.3 Holding or Disposal of the Company’s Shares by Affiliates in the Past Year and as of the Date of Publication of the Annual Report: None
8.4 Other Necessary Supplementary Notes: None
IX. Matters in the Past Year and as of the Date of Publication of

the Annual Report Which Have a Substantial Impact on Owner’s Equity as Stipulated in Item 2, Paragraph 2 of Article 36 of the Securities Exchange Law: None

201 -

Lily Logistics Development Co., LTD

Chairman

Published on: May 18, 2023

AI assistant

LILYTEXTILE — Annual Report 2022

51806_rns_2021-07-30_c3bfd7c3-2c93-478c-8b31-06b5dbdb07d8.pdf

Annual Report

Contents

I. Letter to Shareholders Dear Shareholders,

1. The results of implementation of the 2022 business plan:

2. Budget implementation

4. Research and development analysis

5. Business Plan for 2023

(1) Business Objectives:

II. Company Profile

2.1 Company Profile:

2.2 Company History:

III. Corporate Governance Report

3.1 Organization:

3.2 Directors, General Manager, Deputy General Manager, Associates, Departments and Branches Officer Information 3.2.1 Directors

3.2.2 Major Corporate Shareholders: None

3.2.3 Directors and Supervisors: A. Professional qualifications and independence analysis of directors and independent directors:

B. Diversity and Independence of the Board of Directors:

3.2.4 Directors, Supervisors and Management Team

3.3 Remuneration of Directors, Independent Directors, Supervisors, President, and Vice Presidents

3.3.1 Remuneration of Directors and Independent Director

3.3.2 Remuneration of Supervisors:

Range of Remuneration

3.3.4 Managerial officers with the top five highest remuneration amounts in a TWSE/TPEx-listed company

3.4 Implementation of Corporate Governance

3.4.1 Operations of the Board of Directors

3.4.4 Operation of the Audit Committee:

3.4.6 Fulfillment of CSR and Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”

3.4.7 Composition, Responsibilities and Operations of the Remuneration Committee

3.4.8 Operation of the Remuneration Committee

3.4.9 Fulfillment of Ethical Corporate Management and Deviations from the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies

Training Regarding Corporate Governance:

3.4.15 Implementation Status of Internal Control

A. Statement on Internal Control

LILY TEXTILE CO., LTD.

Statement on Internal Control

3.4.17 Major Resolutions of Shareholders’ Meeting and Board Meetings in the Past Year and as of the Date of Publication of the Annual Report: Shareholders’ Meeting

Other Matters Required to be Recorded:

3.5 Information Regarding the Company’s Audit Fee

3.7 Information on Replacement of CPAs:

3.7.1 Information regarding the former CPAs

3.7.2 Information regarding the Successor CPAs

Changes in Shareholding of Directors, Supervisors, Managerial Officers, and Major

Shares Pledge with Related Parties

3.10 Relationship Information, If Any of the 10 Largest Shareholders is a Related Party as Defined in Statement of Financial Accounting Standards No. 6, or Spouse, or Relative Within the Second Degree of Kinship:

Relationship among the Top Ten Shareholders

3.11 The Total Number of Shares and Total Equity Stake Held in Any Single Enterprise By the Company, Its Directors and Supervisors, Managerial Officers, and Any Companies Controlled Either Directly or Indirectly By the Company:

Total Ownership of Shares in Investee Enterprises

IV. Capital Overview

4.1 Capital and Shares

Type of Stock and Authorized Capital

4.1.2 Status of Shareholders

2. The Company has not issued preferred stock.

4.1.3 Distribution of Shareholding

4.1.4 List of Major Shareholders

4.1.5 Preferred Stock: None

4.1.6 Market Price, Net Worth, Earnings, and Dividends per Share for the Most Recent 2 Fiscal Years

V. Operations Profile

5.1 Business Content

5.2 Market and Sales Overview

Information on Major Customers for the Most Recent 2 Fiscal Years

5.2.4 Production Volume and Value in the Most Recent Two Fiscal Years

5.2.5 Sales Volume and Value in the Most Recent Two Fiscal Years

5.3 Employee Statistics

5.4 Environmental Protection Expenditure:

5.5 Collective Bargaining Agreement Status:

5.6 Important Contracts: None

VI. Financial Information

6.1 Condensed Balance Sheet, Statement of Comprehensive Income Condensed Balance Sheet for the Past Five Years and Audit Opinion from CPAs

6.1.1 Condensed Balance Sheet and Statement of Comprehensive Income Condensed Balance Sheet

(1) Condensed Balance Sheet

(2) Condensed Statement of Comprehensive Income

(3) Concise Individual Balance Sheet

(4) Condensed Individual Income Statement

(3) Auditors’ Opinions from 2018 to 2023

2. Five-Year Financial Analysis

(1) Financial Analysis-Based on IFRS

Audit Committee’s Report for the Annual Report for the Most Recent Year

LILYTEXTILE Annual Report 2022