LPI - Audit Report / Information 2024

Stock Code: 2369

Lingsen Precision Industries, Ltd.

Parent Company Only Financial Statements and Independent Auditors’ Report

For the Years Ended December 31, 2024 and 2023

Address: No. 5-1, Nan’er Rd., Tanzi Dist., Taichung City 427058, Taiwan (R.O.C.)

TEL: (04)25335120

For the convenience of readers and for information purpose only, the auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. In the event of any discrepancy between the English version and the original Chinese version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and financial statements shall prevail.

Independent Auditors’ Report

To the Board of Directors and Shareholders of Lingsen Precision Industries, Ltd.

Audit opinions

We have audited the accompanying parent company only financial statements of Lingsen Precision Industries, Ltd. (the “Company”), which comprise the unconsolidated balance sheets as of December 31, 2024 and 2023, and the unconsolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying unconsolidated financial statements present fairly, in all material respects, the unconsolidated financial position of the Company as of December 31, 2024 and 2023, and its unconsolidated financial performance and its unconsolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulation Governing Auditing and Certification of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the R.O.C. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Unconsolidated Financial Statements section of our report. The auditors of the firm, subject to the independence regulations, have maintained independence from the Company in accordance with the Code of Ethics and perform other obligations of such Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

The key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the unconsolidated financial statements of the Company for the year ended December 31, 2024. These matters were addressed in the context of our audit of the unconsolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matters for the Company's unconsolidated financial statements for the year ended December 31, 2024 are stated as follows:

Authenticity of service revenue recognition

The main source of revenue of the Company relies on the service revenue from various wafers and integrated circuit packaging and testing services; therefore, the service revenue is determined to be the main indicator for the management to evaluate the business performance, and its recognition authenticity has a material impact on the overall financial statements. Accordingly, the authenticity of the recognition of specific customer service revenue is listed as the key audit matter. For revenue recognition related accounting policy, please refer to Note 4 and 20 of the unconsolidated financial statements.

We summarize the main audit procedures executed for the aforementioned matters of the current year as follows:

Understand and assess the internal control design related to the audit and risk in the product sales and payment collection cycle and conduct a test on its effectiveness.
Inspect and obtain samples from the account sales of specific customers, and inspect relevant documents of delivery orders and sales invoices, and also verify whether the payment collection subjects are consistent with the delivery subjects, and also perform letter issuance for customers of service revenue, in order to verify the authenticity of the service revenue.

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

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

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

Those charged with governance, Including the Audit Committee, are responsible for overseeing the Company’s financial reporting process.

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

Our objectives are to obtain reasonable assurance about whether the unconsolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the auditing standards generally accepted in the R.O.C. will always detect a material misstatement when it exists in the unconsolidated financial statements. Misstatements can arise from fraud or error. Misstatements 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 the unconsolidated financial statements.

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

Identify and assess the risk of material misstatement of the unconsolidated financial statements due to fraud or error, design and adopt appropriate countermeasures for the risks assessed, and obtain sufficient and appropriate audit evidence in order to be used as the basis for the opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control of the Company.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management level.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of the Company to continue as a going concern. In case where we consider that such events or circumstances have a material uncertainty, then relevant disclosure of the unconsolidated financial statements are required to be provided in our audit report to allow users of unconsolidated financial statements to be aware of such events or circumstances, 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 Lingsen Precision Industries, Ltd. to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the unconsolidated financial statements, including relevant notes, and whether the unconsolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of the entity of the Company, and express an opinion on unconsolidated financial statements. We are responsible for the direction, supervision and performance of the audit of the Company. We remain solely responsible for our audit opinion.

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

We also provide the governance units with statements that we have complied with relevant matters that may reasonably be thought to bear on our independence, and we have also communicated with the governance units on all relationships and other matters (including relevant protective measures) that may be considered to affect the independence of auditors.

From the matters communicated with those charged with governance, we determine those matters that were of most significant in the audit of the Company’s 2024 unconsolidated financial statements 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.

Deloitte Taiwan CPA Li-Dong Wu CPA Li-Wei Liu

Securities and Futures Commission Approval Document No. Tai-CaI-Zheng-Liu -Zi No. 0920123784

Financial Supervisory Commission Approval Document No. Jin-Guan-Zheng-Shen-Zi No. 1110348898

February 24, 2025

Lingsen Precision Industries, Ltd. Parent Company Only Balance Sheets December 31, 2024 and 2023

Unit: In Thousands of New Taiwan Dollars

				December 31,	2024					December 31,	2023
Code	ASSETS			Amount		%				Amount		%
	Current Assets
1100	Cash and cash equivalents (Note 4 and 6)		$	926,620		14			$	905,641		13
1136	Financial assets at amortized cost- current (Note 4, 8, 27)			161,000			2			161,000			2
1140	Contract assets - current (Note 4 and 20)			102,190			2			117,146			2
1170	Accounts receivable (Note 4, 9 and 20)			937,246		14				957,070		14
1200	Other receivables (Note 4 )			10,144			-			13,761			-
1220	Current tax assets (Note 4 and 22)			1,187			-			57,540			1
1310	Inventories (Note 4 and 10)			270,075			4			275,965			4
1470	Other current assets (Note 14)			189,435			3			221,109			3
11XX	Total current assets			2,597,897		39				2,709,232		39
	Non-current assets
1517	Financial assets at fair value through other comprehensive income
	- non-current
	(Note 4 and 7)			11,862			-			11,763			-
1550	Investment accounted for using the equity method (Note 4 and 11)			1,079,798		16				916,893		13
1600	Property, plant and equipment (Note 4, 12 and 27)			2,467,245		37				2,874,164		42
1755	Right-of-use assets (Note 4 and 13)			137,146			2			143,259			2
1840	Deferred tax assets (Note 4, 5 and 22)			162,432			3			166,386			2
1915	Prepayments for facilities			30,758			1			37,057			1
1920	Refundable deposits (Note 4)			1,246			-			1,232			-
1975	Net defined benefit assets - non-current (Note 4 and 18)			122,829			2			70,849			1
1990	Other non-current assets			6,553			-			8,670			-
15XX	Total non-current assets			4,019,869		61				4,230,273		61
1XXX	Total assets		$	6,617,766		100			$	6,939,505		100
Code	Liabilities and Equity
	Current Liabilities
2100	Short-term bank borrowings (Note 15)		$	130,436			2		$	56,772			1
2170	Accounts payable			223,558			3			216,591			3
2200	Other payables (Note 16 and 26)			434,798			7			428,359			6
2230	Current tax liabilities (Note 4 and 22)			-			-			3,517			-
2250	Liability reserve - current (Note 4 and 17)			3,572			-			5,540			-
2280	Lease liabilities - current (Note 4 and 13)			4,376			-			4,455			-
2320	Long-term borrowings due in one year (Note 15 and 27)			210,096			3			310,596			5
2399	Other current liabilities			115,559			2			88,663			1
21XX	Total current liabilities			1,122,395		17				1,114,493		16
	Non-current liabilities
2540	Long-term banks borrowings (Note 15 and 27)			43,766			1			216,361			3
2570	Deferred tax liabilities (Note 4 and 22)			36,046			-			18,732			1
2580	Lease liabilities - non-current (Note 4 and 13)			135,734			2			141,277			2
2645	Deposits received			930			-			1,900			-
25XX	Total non-current liabilities			216,476			3			378,270			6
2XXX	Total Liabilities			1,338,871		20				1,492,763		22
	Equity
3110	Ordinary shares			3,801,023		57				3,801,023		55
3200	Capital surplus			1,154,573		18				1,266,753		18
	Retained earnings
3310	Legal reserve			121,394			2			121,394			2
3320	Special reserve			92,883			2			165,598			2
3350	Unappropriated earnings			287,863			4			314,447			5
3400	Other equities	(		2,426 )			-	(		46,058 )	(		1 )
3500	Treasury shares	(		176,415)	(		3)	(		176,415)	(		3)
3XXX	Total equity			5,278,895		80				5,446,742		78
	Total liabilities and equities		$	6,617,766		100			$	6,939,505		100

The accompanying notes are an integral part of the parent company only financial statements.

Lingsen Precision Industries, Ltd.

Parent Company Only Statements of Comprehensive Income

For the Years from January 1 to December 31, 2024 and 2023

Unit: Expressed in NT$ thousand; except earnings (loss) per share expressed in NT$

Code 4000 Operating revenue (Note 4, 20 and 26) 5000 Operating costs (Note 10, 21 and 26) 5900 Gross profit Operating expenses (Note 21 and 26) 6100 Selling and marketing expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 Expected credit impairment losses (gains) (Note 4 and 9) 6000 Total operating expenses 6900 Operating loss Non-operating income and expenses (Note 4) 7100 Interest income 7110 Rental income (Note 26) 7130 Dividend income 7190 Other income (Note 26) 7210 Gains on disposal of property, plant and equipment 7230 Net gain on foreign exchange 7510 Interest expenses 7370 Share of profits (loss) of subsidiaries and associates companies using the equity method 7590 Other gains and losses 7000 Total non-operating incomes and expenses		2024		% 100 100 - 1 3 2 - 6 6) - - - 1 - - - 1 - 2		2023
								%
			(				100 97 3 1 3 2 - 6 ( 3) - - - 1 - - - ( 2 ) - ( 1)

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2024	2023
Amount ( $ 172,216 ) 3,988 ( 168,228) 86,161 99 1,531 ( 17,232) 70,559 42,002 112,561 ($ 55,667) ($ 0.45) ($ 0.45)	Amount ( $ 186,339 ) 29,881 ( 156,458) 730 2,715 4,059 ( 146) 7,358 ( 3,381) 3,977 ($ 152,481) ($ 0.42) ($ 0.42)	%
		( 4 ) 1 ( 3) - - - - - - - - - ( 3)
( ( (

The accompanying notes are an integral part of the parent company only financial statements.

Lingsen Precision Industries, Ltd. Parent Company Only Statement of Changes in Equity For the Years from January 1 to December 31, 2024 and 2023

Unit: In Thousands of New Taiwan Dollars

Retained earnings(Note 19)	Retained earnings(Note 19)	Unappropriated earnings (accumulated deficit) (Note 4) 702,042 ( 30,111) ( 74,564) ( 114,031) - - ( 156,458 ) 584 ( 155,874) ( 13,015) 314,447 72,715 - - ( 168,228 ) 68,929 ( 99,299) $ 287,863	Other equityitems(Note 4) Exchange differences on translation of the financial statements of foreign operations Unrealized Valuation Gain/(Loss) on Financial Assets at Fair Value Through Other comprehensive income ( 15,330) ( 47,136) - - - - - - - - - - - - ( 3,381) 6,774 ( 3,381) 6,774 - 13,015 ( 18,711) ( 27,347) - - - - - - ( ) ( ) - - 42,002 1,630 42,002 1,630 $ 23,291 ($ 25,717)	Other equityitems(Note 4) Exchange differences on translation of the financial statements of foreign operations Unrealized Valuation Gain/(Loss) on Financial Assets at Fair Value Through Other comprehensive income ( 15,330) ( 47,136) - - - - - - - - - - - - ( 3,381) 6,774 ( 3,381) 6,774 - 13,015 ( 18,711) ( 27,347) - - - - - - ( ) ( ) - - 42,002 1,630 42,002 1,630 $ 23,291 ($ 25,717)	Treasury shares (Note 19) ( 176,415) - - - - - - - - - ( 176,415) - - - - - - - - ($ 176,415)		Total equity
			Exchange differences on translation of the financial statements of foreign operations ( 15,330) - - - - - - ( 3,381) ( 3,381) - ( 18,711) - - - ( ) ( ) - 42,002 42,002 $ 23,291
Legal reserve 91,283 30,111 - - - - - - - - 121,394 - - - - - - - $ 121,394	Special reserve 91,034 - 74,564 - - - - - - - 165,598 ( 72,715) - - - - - - - $ 92,883
		( ( ( ( ( (	(	( ( (	( ( (	( ( ( ( ( (	5,711,522 - - 114,031) 35 1,697 156,458 ) 3,977 152,481) - 5,446,742 - 75 114,031) 78 1,698 168,228 ) 112,561 55,667) $ 5,278,895

			( ( (








		( (	( (

The accompanying notes are an integral part of the parent company only financial statements.

Lingsen Precision Industries, Ltd.

Parent Company Only Statement of Cash Flows

For the Years from January 1 to December 31, 2024 and 2023

Unit: In Thousands of New Taiwan Dollars

Code Cash flows from operating activities A10000 Net loss before tax for the year Income/expenses items A20100 Depreciation expense A20300 Expected credit impairment losses (gains) A20900 Interest expenses A21200 Interest income A21300 Dividend income A22400 Share of loss (profit) from subsidiaries and associated companies using the equity method A22500 Gains on disposal of property, plant and equipment A23800 Reversal of impairment loss (gain) on non-financial assets A24100 Unrealized foreign currency exchange net loss (profit) A29900 Amortization of prepayments A29900 Provision (reversal) for liabilities A30000 Net changes in operating assets and liabilities A31125 Contract assets A31150 Accounts receivable A31180 Other receivables A31200 Inventories A31240 Other current assets A31990 Net defined benefit assets A32150 Accounts payable A32180 Other payables A32230 Other current liabilities A33000 Cash provided by operating activities A33100 Interest received A33300 Interest paid A33500 Income tax returned (paid) AAAA Net cash inflow from operating activities	2024 ( $ 172,216 ) 528,357 244 12,317 ( 11,699 ) ( 1,573 ) ( 54,534 ) ( 1,440 ) ( 13,722 ) ( 1,913 ) 5,204 ( 1,968 ) 14,956 24,756 3,635 18,668 32,618 34,181 5,376 7,896 26,896 456,039 11,681 ( 12,276 ) 60,860 516,304	2023
		( $ 186,339 ) 575,786 ( 545 ) 19,662 ( 11,701 ) ( 1,186 ) 98,330 - 12,182 2,591 4,331 6 ( 22,469 ) ( 156,266 ) ( 1,833 ) 217,701 39,697 65,932 34,253 ( 15,408 ) 9,348 684,072 11,654 ( 19,892 ) ( 606) 675,228

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Code Cash flows from investing activities B00050 Disposition of financial assets at amortized cost B02200 Net cash outflow for obtaining subsidiaries B02700 Purchase of property, plant and equipment B02800 Proceeds from disposal of property, plant and equipment B03700 Increase in refundable deposits B06700 Increase in other non-current assets B07100 Increase in prepaid facilities amount B07600 Dividends received BBBB Net cash outflow from investment activities Cash flows from financing activities C00100 Increase in short-term bank borrowings C00200 Decrease in short-term bank borrowings C01700 Repayments of long-term bank borrowings C03000 Decrease in guarantee deposits received C04020 Repaid principal of lease liabilities C04500 Payment of cash dividends C09900 Uncollected overdue dividends C09900 Exercise of disgorgement CCCC Net cash outflow from financing activities EEEE Increase (decrease) of cash and cash equivalents for the year E00100 Beginning cash and cash equivalents of the year E00200 End cash and cash equivalents of the year	2024 - ( $ 63,140 ) ( 101,241 ) 2,343 ( 14 ) ( 2,772 ) ( 11,289 ) 1,573 ( 174,540) 445,491 ( 373,994 ) ( 273,095 ) ( 970 ) ( 4,339 ) ( 114,031 ) 75 78 ( 320,785) 20,979 905,641 $ 926,620	2023
		102,000 ( $ 127,890 ) ( 170,573 ) - ( 698 ) ( 8,316 ) ( 6,910 ) 1,186 ( 211,201) 855,011 ( 1,078,438 ) ( 362,929 ) ( 36 ) ( 4,418 ) ( 114,031 ) 35 - ( 704,806) ( 240,779 ) 1,146,420 $ 905,641

The accompanying notes are an integral part of the parent company only financial statements.

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Lingsen Precision Industries, Ltd.

Notes to Parent Company Only Financial Statements

For the Years Ended December 31, 2024 and 2023

(Amounts are expressed in thousands of New Taiwan Dollars or foreign currency, unless stated

otherwise)

1. Company History

Lingsen Precision Industries, Ltd. (referred to as the “Company”) was established in Taichung Tanzi Technology Industrial Park in April 1973 and began its operation in July 1973. The main business is IC packaging and testing as well as optoelectronic devices.

In April 1998, the Company's shares were listed on the Taiwan Stock Exchange (TWSE).

The parent company only financial statements were expressed in New Taiwan dollars, which is the Company's functional currency.

2. Approval Date and Procedures of the Financial Statements

These parent company only financial statements were approved by the Board of Directors on February 24, 2025.

3 . Application of New, Amended and Revised Standards and Interpretations

(1) Initial application of the amendments to the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC)

The initial application of the amendments to the IFRSs endorsed and issued into effect by the FSC did not have any material impact on the Company’s accounting policies.

(2) The IFRSs endorsed by the FSC for application starting from 2025

New, Revised or Amended Standards and Effective Date Interpretations Announced by IASB Amendments to IAS 21 “Lack of Exchangeability” January 1, 2025 (Note)

Note: The Company shall apply those amendments for annual reporting periods beginning on or after January 1, 2025. Upon initial application of the amendments, no restatement of comparative periods, the Company recognizes any effect as an adjustment to the opening balance of retained earnings or recognized any effect as an adjustment to the cumulative amount of translation differences in equity (according to the appropriate) and related affected assets and liabilities.
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(3) New IFRSs issued by International Accounting Standards Board (IASB) but not yet endorsed and issued into effect by the FSC

Effective Date New, Revised or Amended Standards and Announced by IASB Interpretations (Note) Annual Improvements to IFRS Accounting Standards - January 1, 2026 Volume 11 Amendments to IFRS 9 and IFRS 7 “Amendments to the January 1, 2026 Classification and Measurement of Financial Instruments” Amendments to IFRS 9 and IFRS 7 “Contracts January 1, 2026 Referencing Nature-dependent Electricity” Amendments to IFRS 10 and IAS 28 “Sale or Contribution To be determined by of Assets between an Investor and its Associate or Joint IASB Venture” IFRS 17 “Insurance Contracts” January 1, 2023 Amendments to IFRS 17 January 1, 2023 Amendments to IFRS 17 “Initial Application of IFRS 9 January 1, 2023 and IFRS 17 - Comparative Information” IFRS 18 “Presentation and Disclosure in Financial January 1, 2027 Statements” IFRS 19 “Subsidiaries without Public Accountability: January 1, 2027 Disclosures”

Note : Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.

IFRS 18 “Presentation and Disclosure in Financial Statements”

IFRS 18 will supersede IAS 1 “Presentation of Financial Statements”. The main changes comprise:
Items of income and expenses included in the statement of profit or loss shall be classified into the operating, investing, financing, income taxes and discontinued operations categories.
The statement of profit or loss shall present totals and subtotals for operating profit or loss, profit or loss before financing and income taxes and profit or loss.
Provides guidance to enhance the requirements of aggregation and disaggregation: The Company shall identify the assets, liabilities, equity, income, expenses and cash flows that arise from individual transactions or other events and shall classify and aggregate them into groups based on shared characteristics, so as to result in the presentation in the primary financial statements of line items that have at least one similar characteristic. The Company shall disaggregate items with dissimilar characteristics in the primary financial statements and in the notes. The Company labels items as “ other” only if it cannot find a more informative label.
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Increased disclosure of performance measures defined by management: When the Company conducts public communications outside of financial statements and communicates to users of financial statements a management perspective on a certain aspect of the overall financial performance of the Company, it should disclose information related to performance measures defined by management in a single note to the financial statements, including the description of the measure, how it is calculated, its reconciliation with subtotals or totals specified in IFRS accounting standards, and the income tax and non-controlling interest effects of related reconciliation items.

Except for the above impact, as of the date the parent company only financial statements were authorized for issuance, the Company is continuously assessing the possible impact of the application of other standards and interpretations on the Company’s financial position and financial performance and will disclose the relevant impact the other relevant impact when the assessment is completed.

4. Summary of Significant Accounting Policies

(1) Statement of Compliance

These parent company only financial statements were prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”.

(2) Basis of preparation

The parent company only financial statements have been prepared on the historical cost basis except for financial instruments and the present value of the defined benefit obligation deducting the net defined benefit assets of the fair value of any plan assets which are measured at fair value.

The fair value measurements are grouped into Levels 1 to 3 based on the degree to which the fair value measurement inputs are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:

1) Level 1 inputs: quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
3) Level 3 inputs are unobservable inputs for the asset or liability.

In preparing the parent company only financial statements, the equity method is adopted to the investments in subsidiaries and associates. For the purpose of making the current profit and loss, other comprehensive income and equity in the parent company only financial statements identical to those in the Company's owner, several accounting treatment differences under individual and this basis are adjusted into “Investments Accounted for Using Equity Method”, “Share of the Profit or Loss of Subsidiaries and Associates Accounted for Using the Equity Method”, “Share of Other Comprehensive Income of Subsidiaries and Associates Accounted for Using Equity Method” and related items.

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(3) Classification of Current and Non-current Assets and Liabilities

Current assets include:

1) Assets held primarily for the purpose of trading;
2) Assets that are expected to be realized within twelve months from the balance sheet date; and
3) Cash and cash equivalent (unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the date of statement of financial position).

Current liabilities include:

1) Liabilities held primarily for the purpose of trading;
2) Liabilities expected to be settled within twelve months after the maturity of the debt (even if the liability at the date of statement of financial position to complete the long-term refinancing prior to the financial statements or reschedule payment agreement), and
3) Liabilities for which there is no substantive rights to defer the repayment date for at least 12 months after the balance sheet date.

Assets and liabilities that are not classified as current are classified as non-current.

(4) Foreign Currency

In preparing the financial statements, transactions in currencies (foreign currencies) other than the Company’s functional currency are recognized at the exchange rates prevailing at the dates of the transactions.

Foreign currency monetary amount is translated at the closing rate at each date of the balance sheet. Exchange differences arising from settlement or translation are recognized as profit or loss at the period.

Non-monetary foreign currencies held at fair value at the exchange rates prevailing at the date of transaction; however, non-monetary foreign currencies held at fair value through other comprehensive income are recognized in other comprehensive income.

Non-monetary items carried at historical cost are reported using the exchange rate at the date of the transaction and will not calculated again.

In preparing the parent company only financial statements, assets and liabilities from foreign operation, including subsidiaries whose location or currency are different from the Company, are translated into the presentation currency, the New Taiwan dollar, at the exchange rates prevailing at the end of the reporting period. Income and expense items are translated at the average exchange rates at the period. The resulting currency translation differences are recognized in other comprehensive income.

(5) Inventories

Inventories include raw materials, finished goods, and work in process. Inventories are stated at the lower of cost or net realizable value. The lower of cost and net realizable value is based on the individual inventory items. Net realized value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and the estimated costs necessary to make the sale. The inventory cost is measured by using First In, First Out.

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(6) Investment in subsidiaries

The Company’s investments in the subsidiaries are accounted for using the equity method.

Subsidiaries are entities which the Company holds the control of.

Under the equity method, an investment is initially recognized in the statements of financial positional cost and adjusted thereafter to recognize the Company’s share of profit or loss and other comprehensive income of the subsidiaries as well as the distribution received. In addition, the Company also recognizes its share in the changes in equities of subsidiaries.

Changes in equity in the ownership of subsidiaries which do not result in loss of control are disposed as equity transaction. The difference between carrying amount invested and the fair value paid and payable or received and receivable is directly recognized as equity.

The loss of shares of the subsidiary equals or exceeds the Company's interest in that subsidiary, including the carrying amount of that subsidiary under equity method and other long-term equity as the Company's net investment in that subsidiary, is recognized as loss according to proportion of shareholding.

The Company considers cash-generating unit in the entire financial statement as testing for impairment and compares its recoverable amount with its carrying amount. If the recoverable amount of assets increases, the reversal of impairment loss will be recognized as profit. However, the carrying amount of assets after the reversal of impairment loss shall not exceed the carrying amount that would have been determined net of required amortization and have no impairment loss been recognized. Impairment loss of goodwill shall not reverse in the subsequent period.

If the Company loses the control of its subsidiary, it remeasures the retained investments in its former subsidiary as the fair value on initial recognition of a financial asset. The difference between the fair value of the retained investments and any disposal proceeds and the carrying amount of investment at the date is recognized in the current profit or loss. All amount related to that subsidiary is also recognized in other comprehensive income. The accounting treatment is compliance with the basis of rules that Company needs to follow for its direct disposal of assets or liabilities.

Unrealized profit and loss from downstream transactions with a subsidiary is eliminated in the parent company only financial statements. Profit and loss from upstream and side stream transactions between subsidiaries are recognized in the Company’s parent company only financial statements only to the extent that interests in the subsidiary are not related to the Company.

(7) Investment in Associates

The associates are entities which are material to the Company, but not subsidiaries or joint venture companies.

The Company’s investments in the associates are accounted for using the equity method.

16 -

Under the equity method, an investment is initially recognized in the statements of financial positional cost and adjusted thereafter to recognize the Company’s share of profit or loss and other comprehensive income of the associates as well as the distribution received. The Company also recognizes its share in the changes in equities of associates.

The Company discontinues recognizing its share of further losses if its share of losses of the associate equals or exceeds its interest in the associate. The Company recognizes the additional losses and liabilities which occur in the scope of legal obligation, constructive obligation or payment on behalf of the associates only.

The entire carrying amount of the investment is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss is not amortized to any assets as part of the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increases.

(8) Property, plant and equipment

The property, plant and equipment are recognized at costs and subsequently measured at costs of the amount less accumulated depreciation and impairment losses.

Property, plant and equipment in the course of construction for production are recognized as the cost of the amount less accumulated depreciation and impairment losses. And such cost includes professional service fees and borrowing costs eligible for capitalization. Upon completion and ready for intended use, such assets are classified to the appropriate categories of property, plant and equipment, and depreciation of these assets commences.

Depreciation is recognized using the straight-line method, and each significant part is depreciated separately. The Company reviews the estimated useful lives, residual values and depreciation method at least at the end of each reporting period, and with the effect of any changes in estimates accounted for on a prospective basis.

On derecognition of an item of property, plant and equipment, the difference between the sales proceeds and the carrying amount of the asset is recognized in profit or loss.

(9) Impairments of related assets including property, plant and equipment, right-of-use assets and contract cost

At the end of each reporting period, the Company reviews whether there is any indication that its property, plant and equipment, right-of-use assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount, with the resulting impairment loss recognized in profit or loss.

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Inventories recognized in customers' contracts are recognized as impairment loss in accordance with Inventory write off policy and the aforementioned regulations. Subsequently, the excess of carrying amount of assets associated with contract cost over the price received from providing relevant products or service, less direct relevant costs, is recognized as impairment loss. Then the carrying amount of assets associated with contract cost is computed to its cash-generating unit to evaluate the impairment losses on cash-generating unit.

When impairment loss subsequently reverses, the carrying amounts of the asset, cash-generating units or contract cost and related assets are increased to the revised recoverable amounts. However, the increased carrying amounts shall not exceed the carrying amounts of the asset, cash-generating units or contract cost and related assets which were not recognized as impairment loss at the past period (less amortization or depreciation). The reversal of impairment loss is recognized as profit or loss.

(10) Financial instruments

Financial assets and liabilities shall be recognized in the parent company only financial statements when the Company becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

Financial assets

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

1) Classification of measurement

Financial assets held by the Company are classified to financial assets measured at amortized cost and investments in equity instruments measured at fair value through other comprehensive income.

i. Financial assets measured at amortized cost

When the financial assets invested by the Company satisfy the following two criteria at the same time, it is classified as the amortized cost financial assets:

a. Where the financial assets are held under certain business model, and the purpose of such model is to hold the financial assets in order to collect contract cash flows; and
b. Where contract terms generated cash flow of specific date and such cash flow is completely for the payment of the interest of principle and external circulating principle amount.
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Financial assets measured at amortized cost include cash and cash equivalent, financial assets at amortized cost- current, contract assets, note receivables, account receivables, other receivables, other current assets and refundable deposits. When the recognition commences, effective interest method is used to determine the carrying amount less any amortized cost of depreciation. Any exchange gains and losses are recognized as gains and losses.

Except for the following two circumstances, calculation of interest income is based on effective interest rate multiplied by total financial asset’s carrying amount:

a. Purchase or origination of credit-impaired financial loans, interest income, credit-adjusted effective interest rate plus financial loans, post-calculation.
b. Non-purchased or originated credit-impaired financial loans, provided that subsequent credit-impaired financial loans continue to be credit-impaired;

Credit losses on financial assets are significant financial difficulty of the issuer or borrower, a breach of contract, it becoming probable that the borrower will enter bankruptcy or other financial reorganization, or the disappearance of an active market for the financial asset because of financial difficulties.

Cash equivalents, for the purpose of meeting short-term cash commitments, consist of highly liquid time deposits and investments that are readily convertible to known amounts of cash, which are subject to an insignificant risk of changes in value and acquired within three months.

ii) Investments in equity instruments measured at fair value through other comprehensive income

On initial recognition, the Company may irrevocably designate investments in equity instruments that is not held for trading and not recognized as contingent consideration as at FVTOCI.

Investments in equity instruments measured at fair value through other comprehensive income are measured at fair value. Subsequently the changes in fair value are reported in other comprehensive income and accumulated in other equity. On disposal of investments, the accumulated profit or loss is directly transferred to retained earnings and it is not reclassified to profit or loss.

The dividend from investments in equity instruments measured at fair value through other comprehensive income are recognized in profit or loss upon the Company's right to receive payment is established, except for apparently the dividend representing the recovery of the partial investment cost.

2) Impairments of financial assets and contract assets

At the date of each balance sheet, the Company reviews expected credit losses to estimate the impairment loss of financial assets, including notes receivable, and contract assets measured at amortized cost.

19 -

The loss allowance for accounts receivable is measured at an amount equal to useful lives expected credit losses. Other financial assets are assessed to determine whether the credit risk has significantly increased since the original recognition. If there is no significant increase, then the allowance loss is recognized according to the 12-month expected credit loss. If it has increased significantly, then allowance loss is recognized according to the lifetime expected credit loss.

Expected credit losses are weighted average credit losses with the probability of default events. The 12-month expected credit losses are expected credit losses that result from default events possible within 12 months after the reporting date. Lifetime expected credit losses result from all possible default events over the expected life of the financial instruments.

For the purpose of internal controls on credit risk, without considering the collaterals it holds, the Company determines the following events as a breach of contract:

i) There is internal or outside information prevails that it is not possible the borrower pays off the debt.
ii) The overdue exceeds the average credit period, unless reasonable and supportable information indicates that a delayed default basis is more appropriate.

All impairment losses on financial assets is decreased its carrying amount through contra accounts.

3) Derecognition of financial assets

The Company derecognizes the financial assets only when the contractual rights to the cash flows from the financial assets expire, or when it transfers the financial assets and substantially all the risks and rewards of ownership of the financial assets to another entity.

On derecognition of financial assets at amortized cost in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss. On derecognition of Investments in equity instruments measured at fair value through other comprehensive income, the cumulative gain or loss that had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through profit or loss.

Financial liabilities

1) Follow-up measurement

Financial liabilities are measured at amortized cost using effective interest method.

2) Derecognition of financial liabilities

On the derecognition of financial liabilities, the difference between their carrying amount and the consideration paid and payable, including any transfer of non-cash assets or liabilities, is recognized as profit or loss.

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(11) Provision for liabilities

The amount recognized as a provision for liabilities is, taking risk and uncertainty of obligation into consideration, the best estimate of the expenditure required to settle the obligation at the date of balance sheet.

(12) Revenue recognition

The Company allocates the transaction price to each performance obligation and recognizes the revenue when each of the obligations is satisfied after the customer has identified it.

1) Sales revenue

Sales revenue comes from the sale of semiconductor materials. Since the clients are eligible for pricing and using the products as well as responsible for reselling and taking the risk of depreciation upon the delivery of semiconductor materials, the Company shall recognize the revenue and accounts receivable upon the sale.

2) Service income

Service Income comes from packaging and final testing.

When the customer simultaneously receives and consumes the benefits provided by the Company's performance of packaging and final testing service, or the customer controls an asset which the Company's performance has created or enhanced, the related revenue is recognized. Packaging of products counts on involvement of technicians. The Company measures the work in progress by the percentage of completion. The contract with customer states that the customer will be billed after the packaging or the delivery is completed. A contract asset is thus recognized when the Company renders the service and transferred to accounts receivable when the packaging or delivery is completed. Final testing counts on the involvement of technicians. The Company measures the work in progress by the percentage of completion. Contract customer will be billed after the completion of service, and the Company will recognize accounts receivable when rendering the service.

(13) Leases

At the inception of a contract, the Company assesses whether the contract is, or contains, a lease.

1) The Company as lessor

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Under the operating lease, lease payments less lease incentives granted are recognized as revenue on a straight-line basis. The initial direct cost which occurs on granting operating leases is the carrying amount accumulated to the underlying assets and is recognized as expense on a straight of line basis.

2) The Company as lessee

Except for payments for low-value asset leases and short-term leases applicable to exemption of recognition are recognized as expenses on a straight-line basis, the Group recognizes right-of-use assets and lease liabilities for all leases at the commencement date of the lease.

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Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease liabilities, lease payments made before commencement date less lease incentives granted initial direct costs as well as estimated costs to restore the underlying assets. Right-of-use assets are subsequently measured at cost less accumulated depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities. Right-of-use assets are presented on a separate line in the parent company only balance sheets.

Right-of-use assets are depreciated using the straight-line method from the commencement dates to the earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.

Lease liabilities are initially measured at the present value of the lease payments, which comprise fixed payments and the default fine arises from lease termination. The lease payments are discounted using the interest rate in a lease if that rate can be readily determined. If that rate cannot be readily determined, the Group uses the incremental borrowing rate.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in a lease term, the Company remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized as profit or loss. Lease liabilities are presented on a separate line in the balance sheets.

(14) Borrowing costs

Borrowing costs that can be directly attributable to the acquisition, construction or production of a qualifying asset, that necessarily takes a substantial period of time to get ready for its intended use or sale, are included in the cost of the asset.

Where funds are borrowed specifically, costs eligible for capitalization are the actual costs incurred less any income earned on the temporary investment of such borrowings.

Other borrowing costs at the period are recognized as profit or loss.

(15) Employee benefits

1) Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognized as expenses in that period when the employees render service.

2) Pensions

For defined contribution plans, the amount of contribution payable in respect of service rendered by employees in that period should be recognized as expenses.

Defined benefit costs (including service cost, net interest and remeasurement) under the defined benefit retirement benefit plans are determined using the Projected Unit Credit Method. Service cost and net interest on the net defined benefit assets are recognized as employee benefits expense in the period they occur. Remeasurement, comprising actuarial gains and losses and the return on plan assets (excluding interest), is recognized in other comprehensive income in the period in which they occur.

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The net defined benefit assets represent the actual deficit in the Company’s defined benefit plan. Net defined benefit assets shall not exceed the present value of refunds from the plan or reductions in future contributions to the plan.

(16) Income tax

The provision for income tax recognized in profit or loss comprises current and deferred tax.

1) Current tax

The Company has determined the current losses and calculated receivable taxes in accordance with regulations established by the jurisdiction for tax return.

According to Income Tax Act in Republic of China, an additional income tax levied at unappropriated earnings is recognized in shareholders' annual meeting.

Income tax payable for prior period is adjusted to the current income tax.

2) Deferred tax

Deferred tax is accounted for temporary differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax basis used in the computation of taxable profit or loss.

Deferred tax liability is generally recognized for all taxable temporary differences. Deferred tax asset is recognized for deductible temporary differences or loss carryforwards to the extent that taxable profit is probably available.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except where the Company can control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deductible temporary differences associated with such investments are only recognized to the extent that it is probable that there will be sufficient taxable profits to realize the temporary differences and they are expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at the date of balance sheet and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered. The deferred tax assets originally not recognized is also reviewed at the date of balance sheet and increased to the extent that it is probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the year in which the liability is settled or the asset is recovered, based on tax rates and laws that have been enacted or substantively enacted by the date of balanced sheet. The measurement of deferred tax liabilities and assets reflects the tax consequences that arise from the manner in which the Company expects, at the date of balance sheet, to recover or settle the carrying amount of its assets and liabilities.

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3) Current and deferred tax for the year

Current and deferred tax are recognized in profit or loss, except the current and deferred tax that relates to items recognized in other comprehensive income or directly in equity are recognized respectively in other comprehensive income or directly in equity.

5. Significant Accounting Assumptions and Judgment, and Major Sources of Estimation Uncertainty

In the application of the Company’s accounting policies, the management is required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experiences and other factors that are considered relevant. Actual results may differ from these estimates.

The Company incorporates the recent development of major accounting estimates such as cash flow estimation, growth rate, discount rate, and profitability. For these considerations, management will continue to review the estimates and underlying assumptions. Revisions to accounting estimates are recognized in the period when the estimates are revised if the revisions affect only that period. If revisions affect both current and future periods, the accounting estimates are recognized in the current and future periods.

Major source of estimates and assumption uncertainty

(1) Loss of property, plant, and equipment

Equipment relevant to semiconductor manufacturing is evaluated in accordance with the recoverable amount of such equipment (equal to the fair value of such asset less cost to sell and the higher amount of its use value). Market value or future changes in cash flow will affect the recoverable amount, resulting in the Company recognizing addition impairment losses or reversing impairment losses recognized.

(2) Income tax

Upon the date of December 31, 2024, the balance of unused loss carryforwards not recognized as deferred tax assets in the individual balance sheet was NT$209,573,000. The loss carryforwards and the carrying amount of deferred tax assets related to temporary differences for 2024 and 2023 were NT$162,432,000 and NT$166,386,000 respectively. The realizability of deferred tax assets mainly depends on whether there will be sufficient profits or taxable temporary differences in the future. A significant reversal of deferred tax assets will be recognized as gain or loss if the real profits in the future are less than expected. Such reversal is recognized as gain or loss during the occurrence period.

6. Cash and cash equivalents

Cash on hand and petty cash Check and demand deposit Cash equivalents Time deposits Short-term notes and bills	December 31,2024 $ 273 345,496 431,000 149,851 $ 926,620	December 31,2023	December 31,2023
			$ 245 281,658 474,000 149,738 $ 905,641

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Annual interest rate (%) Cash in banks Time deposits Short-term notes and bills	December 31,2024 0.001-0.8 1.10-1.65 1.10	December 31,2023
		0.001-1.45 1.09-1.60 0.85

7. Financial assets at fair value through other comprehensive income- non-current

Listed and OTC stocks ETREND Hightech Corp. Emerging stocks Amtek Semiconductors Co., Ltd. Xpert Semiconductor Inc.	December 31,2024 $ 2,280 9,582 - $ 11,862	December 31,2023 $ 3,146 8,617 - $ 11,763	December 31,2023 $ 3,146 8,617 - $ 11,763
			$ 3,146 8,617 - $ 11,763

The Company invests the aforementioned common stocks in accordance with long-term strategic objectives and expects to profit from long-term investments. The management of the Company deems if the short-term volatility at fair value of such investments recognized in profit or loss is not consistent with the aforementioned long-term investment plan, it will be determined that such investments are measured through other comprehensive income at fair value.

8. Financial assets at amortized cost- current

ial assets at amortized cost-current
Time deposits with an initial maturity more than three months Time deposit pledged	December 31,2024 $ 160,000 1,000 $ 161,000	December 31,2023
			$ 160,000 1,000 $ 161,000

As of December 31, 2024 and 2023, annual rate of time deposits with an initial maturity more than three months is 1.1%-1.69% and 1.1%-1.58%, respectively.
Please see Note 27 for the information of financial assets at amortized cost- current.

9. Accounts receivable

nts receivable
Amortized cost Total carrying amount Less: Allowance for bad debts	December 31,2024 $ 938,656 ( 1,410) $ 937,246	December 31,2023
	(	(	$ 958,236 1,166) $ 957,070

The average collection period for selling products and rendering service of the Company is 60 to 90 days, excluding accounts receivable. Credit of key customers is rated by using other public available financial information and historic transaction records. The Company continues supervising credit risk exposure and credit rating of the counterparty, as well as distributing the total transaction amount into different qualified customers. In addition, the management shall review and approve

25 -

counterparty's line of credit for the purpose of managing credit risk exposure.

To mitigate credit risk, the management of the Company has designated functional working group responsible for decision on line of credit, credit approval and other supervision to ensure proper action has been taken to collect overdue accounts receivable. In addition, the collectible amount of accounts receivable of the Company shall be reviewed individually at the date of balance sheet to ensure the uncollectible accounts receivable has been listed to appropriate impairment loss. Accordingly, the management of the Company considers the Company's credit risk has significantly decreased.

The loss allowance for accounts receivable of the Company is measured at an amount equal to useful lives expected credit losses. For the useful lives expected credit losses, customers' default on records and present financial position, economic trends, as well as GDP expectation and industry outlook are considered. The experience on the Company's credit losses presents that types of loss on different customer groups do not bring obvious differences. Thus the rate of expected credit losses is set based on accounts receivable aging, without further grouping customers.

If any evidence shows the counterparty faces significant financial difficulty and the collectible amount cannot be reasonably expected, the Company will directly offset the relevant accounts receivable but keep track of the receivables. The recovered amount is recognized in profit or loss.

The loss allowance for accounts receivable is measured as follows:

December 31, 2024 Expected credit loss (%) Total carrying amount Allowance for loss Amortized cost December 31, 2023 Expected credit loss (%) Total carrying amount Allowance for loss Amortized cost		0~90 days	Aging 91~180 days	Aging 91~180 days	Aging 181~365 days	Aging 181~365 days	Aging over 365 days	Aging over 365 days		Total
	(	0.1 $ 920,212 916) $ 919,296 0~90 days	2 $ 16,873 ( 337) $ 16,536 Aging 91~180 days		10 $ 1,571 ( 157) $ 1,414 Aging 181~365 days		100 $ - - $ - Aging over 365 days		(	$ 938,656 1,410) $ 937,246 Total
	(	0.1 $ 947,931 958) $ 946,973	(	2 $ 10,289 206) $ 10,083	(	10 $ 16 2) $ 14		100 $ - - $ -	(	$ 958,236 1,166) $ 957,070

Changes on allowance for accounts receivable loss are as follows:

Balance at the beginning of the year Provision (reversal) Balance at the end of the year		2024 $ 1,166 244 $ 1,410		2023
			(	$ 1,711 545) $ 1,166

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10. Inventories

ntories
Raw materials Finished goods Work in process	December 31,2024 $ 270,075 - - $ 270,075	December 31,2023
			$ 275,965 - - $ 275,965

Inventory-related operating costs as of 2024 and 2023 are NT$4,604,735,000 and NT$4,551,092,000 respectively.

Operating costs include the following items:

Revenue from sale of scraps Inventory valuation losses (gain from price recovery) Supply inventory valuation losses (gain from price recovery)	2024 ( $ 47,501 ) ( 12,778 ) ( 944 )	2023
		( $ 43,406 ) 5,154 7,028

Inventory and supply inventory net realizable value recovery in 2024 were due to better inventory turnover..

11. Investments accounted for using the equity method

Investment in subsidiaries Investment in Associates	December 31,2024 $ 1,079,798 - $ 1,079,798	December 31,2023	December 31,2023
			$ 916,893 - $ 916,893

Investment in subsidiaries
		December 31,	2024		December 31,	2023
Investees		Amount	Equity		Amount	Equity
			%			%
Private entity
Lingsen Holding (Samoa) Inc.		$ 329,329	100		$ 128,390	100
Panther Technology Co., Ltd.		350,642	64		408,399	64
Sooner Power Semiconductor
Co., Ltd.		230,378	99		220,165	99
Lee Shin Investment Co., Ltd.		254,719	100		249,741	100
Lingsen America Inc.		70,220	100		65,773	100
Nexus Material Corporation		27,239	78		27,154	78
		1,262,527			1,099,622
Less: Transferred treasury
shares	(	176,415 )		(	176,415 )
Accumulated impairment loss	(	6,314)		(	6,314)
		$ 1,079,798			$ 916,893

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The Company has been approved by Investment Commission, MOEA to invest in Lingsen Holding (Samoa) Inc. at NT$31,260,000 (US$1,000,000), NT$96,630,000 (US$3,000,000), NT$63,140,000 (US$2,000,000)respectively in July 2023 and October 2023, March 2024. In the meantime, Lingsen Holding (Samoa) Inc. indirectly reinvested in Ningbo Liyuan Technology Co., Ltd. through the investment company Li Yuan Investments Co., Ltd.

In consideration of the overall operational development needs of the Company, the board of directors approved the disposal of Ningbo Liyuan Company on February 17, 2024, and the sales contract was signed on April 11, 2024.

This disposal plan was completed on April 25, 2024. For related notes, please refer to Note 26 to the consolidated financial statements.

Please see Table 3 and 4 for detailed investments in subsidiaries indirectly held by the Company.

The share of profit or loss and other comprehensive income of subsidiaries accounted for using the equity method in 2024 and 2023 are in accordance with auditors' reports of each subsidiary as of the same period.

(2) Investment in Associates

Investment in Associates
Investees Private entity Qi Feng Technology Co., Ltd. Less: Accumulated impairment loss		December 31,2024 Amount Sharehol ding $ 11,417 30% 11,417) $ -		December 31,2023
		Amount $ 11,417 11,417) $ -		Amount $ 11,417 11,417) $ -	Sharehol ding
	(		(		30%

Investments accounted for using the equity method as well as the Company's share of profit or loss and other comprehensive income are not calculated in accordance with auditors' reports. However, the management of the Company determines that it shall have little influence if financial statements of Qi Feng Technology Co., Ltd. are not audited.

12. Property, Plant and Equipment

erty, Plant and Equipment
Assets used by the Company Assets subject to operating leases		December 31,2024 $ 2,290,354 176,891 $ 2,467,245		December 31,2023
				$ 2,692,402 181,762 $ 2,874,164

(1) Assets used by the Company

2024 Cost Balance at the beginning of the year Increase Decrease Reclassification Balance at the end of the year (Continued on next page)	Buildings $2,400,732 9,044 ( 102,018 ) 10,609 $2,318,367	Machinery and equipment	Transportati on Equipment $ 18,827 - - - $ 18,827	Office equipment $ 30,154 1,030 ( 2,956 ) - $ 28,228	Other equipment $ 319,547 55,493 ( 59,148 ) 14,000 $ 329,892	Unfinished construction $ 13,627 13,728 - ( 22,879) $ 4,476	Total cost
		$3,252,994 20,944 ( 799,908 ) 15,542 $2,489,572				(	$6,035,881 100,239 ( 964,030 ) 17,272 $5,189,362

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(Continued from
previous page)
		Buildings	Machinery	Transportati				Office		Other	Unfinished		Total cost
2024			and		on		equipment			equipment	construction
			equipment	Equipment
Accumulated
depreciation
Balance at the
beginning of		$1,083,595	$2,032,083	$	13,024		$	19,532		$ 195,245	$	-	$3,343,479
the year
Increase		110,145	330,960		1,173			2,720		73,658		-	518,656
Decrease	(	102,018)	(799,005)		-	(		2,956)	(	59,148)		-	(963,127)
Balance at the
end of the		$1,091,722	$1,564,038	$	14,197		$	19,296		$ 209,755	$	-	$2,899,008
year
Carrying
amounts at December		$1,226,645	$ 925,534	$	4,630		$	8,932		$ 120,137	$	4,476	$2,290,354
31,2024
2023
Cost
Balance at the
beginning of		$2,380,470	$3,303,314	$	18,827		$	32,745		$ 313,773	$	5,231	$6,054,360
the year
Increase		7,660	87,340		-					49,120		12,911	157,031
Decrease	(	33,275 )	( 246,142 )		-	(		2,591 )	(	44,346 )		-	( 326,354 )
Reclassification		45,877	108,482		-			-		1,000	(	4,515)	150,844
Balance at the end of the year		$2,400,732	$3,252,994	$	18,827		$	30,154		$ 319,547	$	13,627	$6,035,881
Accumulated
depreciation
Balance at the
beginning of		$ 964,661	$1,903,010	$	11,853		$	18,899		$ 163,002	$	-	$3,061,425
the year
Increase		109,847	375,215		1,171			3,224		76,589		-	566,046
Decrease	(	33,275 )	( 246,142 )		-	(		2,591 )	(	44,346 )		-	( 326,354 )
Reclassification		42,362	-		-			-		-		-	42,362
Balance at the end of the year		$1,083,595	$2,032,083	$	13,024		$	19,532		$ 195,245	$	-	$3,343,479
Carrying
amounts at December		$1,317,137	$1,220,911	$	5,803		$	10,622		$ 124,302	$	13,627	$2,692,402
31,2023

For 2023 and 2024, since there was no impairment loss, the company had not conducted the impairment loss evaluation.

Depreciation is computed on a straight-line basis over the following estimated useful life:

Buildings
Plant building	45 ~ 50 years
Hydropower air-conditioning engineering	3 ~ 20 years
Machinery and equipment	3 ~ 7 years
Transportation Equipment	5 ~ 7 years
Office equipment	3 ~ 7 years
Other equipment	3 ~ 7 years

Please see Note 27 for the amount of property, plant, and equipment used by the Company pledged as collaterals.

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(2) Assets subject to operating leases

Assets subject to operating leases
2024 Cost Balance at the beginning and end of the year Accumulated depreciation Balance at the beginning of the year Increase Balance at the end of the year Carrying amounts at December 31,2024 2023 Cost Balance at the beginning of the year Increase Balance at the end of the year Accumulated depreciation Balance at the beginning of the year Increase Reclassification Balance at the end of the year Carrying amounts at December 31,2023			Buildings
		( (	$ 237,827 $ 56,065 4,871 $ 60,936 $ 176,891 $ 280,189 42,362) $ 237,827 $ 93,556 4,871 42,362) $ 56,065 $ 181,762

The Company has used buildings based on operating leases with a lease term of 1 to 18 years. All operating lease contracts include the clause where the lessee shall adjust the lease payment according to market rent when a right of renewal is exercised. The lessee has no bargain purchase option on such asset after the end of the lease period.

The operating lease payments receivable for the buildings is as follows:

Year 1 Year 2 Year 3 Year 4 Year 5 Over 5 years	December31,2024 $ 5,232 4,575 4,575 4,575 4,575 22,873 $ 46,405	December31,2023	December31,2023
			$ 7,879 4,144 4,144 4,144 4,144 20,719 $ 45,174

Depreciation is computed on a straight-line basis over the following estimated useful life:

Buildings 45 ~ 50 years

Lease agreements

(1) Right-of-use assets

Carrying amount of right-of-use assets Land Buildings	December 31,2024	December 31,2024	December 31,2023	December 31,2023
		$ 136,505 641 $ 137,146		$ 141,977 1,282 $ 143,259

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Addition of right-of-use assets Depreciation expense of right-of-use assets Land Buildings		2024		2023
		$ - $ 4,189 641 $ 4,830		$ 2,786 $ 4,227 642 $ 4,869

Except for the depreciation expenses recognized above, there were no major sublease and impairment loss of the right-of-use assets of the Company in 2024 and 2023.

(2) Lease liabilities

Lease liabilities
December 31,2024 Carrying amount of lease liabilities Current $ 4,376 Non-current $ 135,734 Ranges of discount rates for lease liabilities are as follow December 31,2024 Land 0.67%-1.55% Buildings 1.50%	December 31,2023 $ 4,455 $ 141,277 December 31,2023 0.67%-1.64% 0.67%-1.50%

		0.67%-1.64% 0.67%-1.50%

(3) Material leases and terms

The Company leases several lands and buildings for the use of plants, office buildings and employee dormitories with a lease term of 1 to 10 years. Upon the termination of the lease period, the Company has no bargain purchase option for leased lands and buildings.

(4) Information on other lease

Please see Note 12 for agreements that the Company sells property, plant and equipment used by the Company under operating leases.

Expenses relating to short-term leases Total cash outflow for leases		2024 $ 1,030 $ 6,610)		2023
	(		(	$ 1,428 $ 6,942)

The Company leases certain machinery and equipment, buildings and building leases which qualify as short-term leases. The Company has elected to apply the recognition exemption and thus did not recognize right-of-use assets and lease liabilities for these leases.

14. Other current assets

liabilities for these leases. r current assets
Current Supply inventory Prepayments Payments on behalf of others Input tax Others	December 31,2024 $ 159,632 14,463 12,796 2,195 349 $ 189,435	December 31,2023
			$ 186,926 25,147 6,626 2,130 280 $ 221,109

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15. Borrowings

(1)	Short-term bank borrowings Import/export financing loans Annual interest rate (%) Import/export financing loans	December 31,2024 $ 130,436 5.24-5.44	December 31,2023	December 31,2023
				$ 56,772 6.31-6.41

(2)	Long-term bank borrowings Mortgage loan (Note 27) Credit loans Less: Amount falling due in one year Amount falling due after one year Annual interest rate (%) Mortgage loan Credit loans Maturity date Mortgage loan Credit loans	December 31,2024 $ 37,500 216,362 253,862 ( 210,096) $ 43,766 1.91 1.51-1.66 2025.06 2026.03-2026.05	December 31,2023
			$ 150,000 376,957 526,957 ( 310,596) $ 216,361 1.78 1.37-1.53 2025.06 2026.03-2026.05

16. Other payables

r payables
Payables for Wages and bonuses Payables for factory supplies Payables for annual leave Payables for purchases of equipment Others	December 31,2024 $ 184,305 90,753 54,414 6,954 98,372 $ 434,798	December 31,2023
			$ 186,644 88,676 52,999 8,496 91,544 $ 428,359

17. Provisions - Current

Provisions for sales returns and allowances are, estimated under experiences, judgment of the management and other known reasons for the probable sales returns and allowances, and recognized as the subtraction of operating revenue upon the related service is provided and products are sold at the current year.

Changes on provisions are as below:

Changes on provisions are as below:
Balance at the beginning of the year Current recognition (reversal) Balance at the end of the year		2024 $ 5,540 1,968) $ 3,572		2023
	(			$ 5,534 6 $ 5,540

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18. Retirement benefits plan

(1) Defined contribution plans

The pension system of the “Labor Pension Act” is applicable to the Company, belonging to the affirmed appropriation of pension plan under the management of the government, and pension is appropriated at the rate of 6% of the monthly salary of employees into the personal dedicated account of the Bureau of Labor Insurance.

(2) Defined benefit plans

The Company has labor pension system as defined benefit plans under the Labor Standards Act of R.O.C... The payment of the employee pension is made based on an employee’s length of service and average monthly salary for the six-month period prior to retirement approved. The Company contributes an amount equal to 3 percent of salaries paid each month to their respective pension funds (the Funds), which are administered by the Labor Pension Fund Supervisory Committee (the Committee) and deposited in the Committee’s name in the Bank of Taiwan. Before the end of each year, the balance in the Funds is assessed. If the amount of the balance in the Funds is inadequate to pay retirement benefits for employees qualified with retirement requirements in the next year, the Company is required to make up the difference all at once with one appropriation, which is required to be made before the end of March of next year. The Funds are operated and managed by the government’s designated authorities. Accordingly, the Company does not have any right to intervene in the investments of the Funds.

The amount of defined benefit plans recognized in the consolidated balance sheets is as follows:

as follows:
Present value of defined benefit obligation Fair value of plan assets Net defined benefit assets	December 31,2024 $ 552,740 ( 675,569) ($ 122,829 )	December 31,2023
	( (	( (	$ 608,362 679,211) $ 70,849)

Movements the net defined benefit assets are as follows:

Balance at January 1, 2024 Service cost Current service cost Interest expense (income) Defined benefit costs recognized in profit or loss Remeasurement of the net defined benefit liability/asset Return on plan assets (excluding amounts included in net interest expense)	Present value of defined benefit obligation $ 608,362 5,159 7,453 12,612 -	Fair value of plan assets ($ 679,211) - ( 8,376) ( 8,376) ( 58,944 )	Net defined benefit liabilities(assets) ($ 70,849) 5,159 ( 923) 4,236 ( 58,944 )	Net defined benefit liabilities(assets) ($ 70,849) 5,159 ( 923) 4,236 ( 58,944 )
		( ( ( (		$ 70,849) 5,159 923) 4,236 58,944 )

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Present value of defined benefit obligation 1 ( 19,289 ) ( 7,929) ( 27,217) - - ( 41,017) ( 41,017) $ 552,740 $ 618,521 5,120 7,911 13,031 - 1 2,726 6,951 9,678 - - ( 32,868) ( 32,868) $ 608,362	Fair value of plan assets - - - ( 58,944) ( 6,000 ) 42,599 34,363 70,962 ($ 675,569) ($ 754,572) - ( 9,758) ( 9,758) ( 10,408 ) - - - ( 10,408) ( 6,500 ) 69,638 32,389 95,527 ($ 679,211)	Net defined benefit liabilities(assets)	Net defined benefit liabilities(assets)
( ( ( ( (	( ( ( ( ( ( ( ( ( (	( ( ( ( ( ( ( ( ( (	1 19,289 ) 7,929) 86,161) 6,000 ) 42,599 6,654) 29,945 $ 122,829) $ 136,051) 5,120 1,847) 3,273) 10,408 ) 1 2,726 6,951 730) 6,500 ) 69,638 479) 62,659 $ 70,849)
		( ( ( (
( (

Due to the defined benefit plans under the Labor Standards Act of R.O.C. the Company is exposed to the following risks:

1) Investment risk: The pension funds are invested in domestic and foreign equity securities, debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau of Labor Funds’ designated authorities or under the mandated management. However, the distributable amount of plan assets of the Company shall not be less than the return calculated by the average interest rate on a two-year time deposit published by the local banks.
2) Interest risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation. However, the return on the debt investments of the plan assets will increase as well. The two will be partially offset on net defined benefit liabilities
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3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.

The actuarial valuations of the present value of the defined benefit obligation of the Company are carried out by qualified actuaries. The principal assumptions are as follows:

follows:
Discount rate Expected salary increase rate	December 31,2024 1.65% 2.00%	December 31,2023
		1.25% 2.00%

If reasonably likely changes respectively occur in the principal assumptions and all other assumptions are held constant, the amount of present value of the defined benefit obligation is increased or decreased as follows:

Discount rate Increase by 0.25% Decrease by 0.25% Expected salary increase rate Increase by 0.25% Decrease by 0.25%	December 31,2024 ($ 11,577) $ 11,942 $ 11,871 ($ 11,566)	December 31,2023	December 31,2023
	( (	( (	$ 13,454) $ 13,903 $ 13,765 $ 13,389)

The sensitivity analysis presented above may not reflect the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Contributions expected in one year Average maturity of defined benefit obligation	December 31,2024 $ 6,000 8 years	December 31,2023	December 31,2023
			$ 6,000 9 years

19. Equity

(1) Ordinary shares

Ordinary shares
Authorized shares (in thousands) Authorized capital Issued and paid shares (in thousands) Issued capital	December 31,2024 500,000 $ 5,000,000 380,102 $ 3,801,023	December 31,2023
			500,000 $ 5,000,000 380,102 $ 3,801,023

A holder of issued common shares with par value of NT$10 per share is entitled to vote and to receive dividends.

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(2) Capital surplus

Capital surplus
Additional paid-in capital From convertible bonds Treasury stock transaction s Donations	December 31,2024 $ 1,009,120 126,434 18,338 681 $ 1,154,573	December 31,2023
			$ 1,123,151 126,434 16,640 528 $ 1,266,753

The capital surplus generated from donations and the excess of the issuance price over the par value of capital stock (including the stock issued for new capital, convertible bonds, treasury stocks and difference between the price of acquisition or disposal of subsidiaries' equity and the book value) may be used to offset a deficit. In addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or stock dividends to the paid-in capital. However, stock dividends may not exceed a certain percent of the paid-in capital.

(3) Retained earnings and dividend policy

Surplus earning distribution policy under the Company's Articles of Incorporation states that when allocating earnings, the Company shall pay the tax, offset its losses, set aside its legal capital reserve at 10% of the retained earnings, and then set aside or reverse special capital reserve in accordance with relevant laws or regulations; if here are earnings left, along with accumulated unappropriated earnings, the Board of Directors shall propose the surplus earning distribution for shareholders' meeting to determine the allocation of dividends and bonus. Please see Note 21 for distribution policy for employees’ compensation, and remuneration of directors under the Company's Articles of Incorporation.

Legal capital reserve shall be set aside until its balance equals to full amount of the paid-in capital. The reserve may be used to offset a deficit. When the Group has no deficit, the portion in excess of 25% of the paid-in capital may be used to distribute as dividends in stocks or cash.

The Company held regular shareholders' meetings in May 2023 respectively and passed the 2022 earnings distribution proposals as follows:

Legal reserve Provision of special reserve Cash dividends Cash dividend per share (NT$)	2022
	$ 30,111 $ 74,564 $ 114,031 $ 0.30

The Company has approved loss make-up proposal for 2023 in the shareholders’ meeting in May 2024. Due to losses in 2023, after the deficit was compensated with the reversal of special reserve of NT$72,715,000, the Company proposed a capital reserve distribution of 114,031,000 in cash (NT$0.3 per share).

The Company approved loss make-up proposal for 2024 in the Company's board of directors on February 24, 2025. Due to a deficit in 2024, after the deficit was compensated with the reversal of special reserve of NT$14,488,000, the Company proposed a capital reserve distribution of 114,031,000 in cash (NT$0.3 per share).

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The distribution of loss for 2024 is subject to the resolution of the shareholders’ meeting to be held in May 2025.

(4) Treasury stocks

The treasury stocks held by the Company, in accordance with Securities and Exchange Act, shall not be pledged and is not entitle to distribute dividends and to vote.

The relevant information on the Company's shares held by Lee Shin Investment Co., Ltd. is as follows:

December 31, 2024 December 31, 2023	Total shares held(shares) 5,658,911 5,658,911		Carrying amount $ 100,446 $ 129,589	Market value $ 100,446 $ 129,589	Market value $ 100,446 $ 129,589
					$ 100,446 $ 129,589

The shares of the Company held by a subsidiary shall be regarded as treasury stocks. It is given the same rights as the common shareholders, except for capital increase from the Company and voting right.

20. Revenue

evenue
2024 Revenue from contracts with custome Service income $ 4,574,658 Sales revenue 37,200 $ 4,611,858 Contract balance December 31, 2024 December 31, 2023 Contract assets - current $ 102,190 $ 117,146 Accounts receivable 937,246 957,070 $ 1,039,436 $ 1,074,216			2023
			$ 4,688,469 37,285 $ 4,725,754 January 1, 2023 $ 94,677 810,312 $ 904,989

(1) Contract balance

The Company recognizes allowance losses on contract assets based on expected credit losses during the duration. Contract assets will be classified as accounts receivable when billing is issued, and their credit risk characteristics are the same as accounts receivable arising from similar contracts. Therefore, the company believes that the expected credit loss rate of accounts receivable can also be applied to contract assets.

(2) Timing of revenue recognition

Timing of revenue recognition
Performance obligation satisfied over time Performance obligation satisfied at a point in time		2024 $ 4,574,658 37,200 $ 4,611,858		2023
				$ 4,688,469 37,285 $ 4,725,754

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21. Employee benefits and depreciation expenses

Classified as 2024 Employee benefit expense Short-term employee benefits Labor and health insurance expense Pensions Defined contribution plans Defined benefit plans Remuneration of Directors Other employee benefits Depreciation expenses 2023 Employee benefit expense Short-term employee benefits Labor and health insurance expense Pensions Defined contribution plans Defined benefit plans Remuneration of Directors Other employee benefits Depreciation expenses	operatingcosts $ 1,141,631 137,593 45,730 3,727 - 87,261 516,751 1,102,201 131,008 44,342 2,853 - 85,411 561,841	operatingexpenses $ 160,736 16,168 6,692 509 1,800 9,584 11,606 167,433 16,823 6,736 420 1,800 10,148 13,945	Total
			$ 1,302,367 153,761 52,422 4,236 1,800 96,845 528,357 1,269,634 147,831 51,078 3,273 1,800 95,559 575,786

For the years of 2024 and 2023, the Company had average 2,319 and 2,294 employees respectively, which included 6 and 5 non-employee directors for the respective year.

Average labor cost for the years 2024 and 2023 were NT$695,000 and 685,000 respectively. Average salary and bonus were NT$563,000 and 555,000 respectively. The average salary and bonus increase by 1% year over year.

The Company's remuneration policy

Except for independent directors receive a certain amount of remuneration, the remuneration of directors is reasonably provided according to the result of corporate operation and the director's performance and participation. For remunerations of managerial officers and employees, remunerations are paid according to their respective job positions, responsibilities, future risk and contribution level to the business objectives and according to the remuneration management regulations of the Company.

Under the Company's Articles of Incorporation, the Company shall accrue employees’ compensation and remuneration of directors at the rates of no less than 10% and no higher than 2% respectively, of net profit before income tax, of remuneration of employees and remuneration of directors. Due to a deficit in 2024 and 2023, the remuneration of employees and remuneration of directors have not been estimated yet.

If there is a change in the amounts after the annual parent company only financial statements are authorized for issuance, the differences are recorded as a change in the accounting estimate.

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Please see “Market Observation Post System” (MOPS) under the Taiwan Stock Exchange for the information on the remuneration of employees and remuneration of directors determined by the board of directors.

22. Income tax

(1) Main components of income tax expense recognized in profit or loss

2024 2023 Current tax Income tax expense generated in the current year $ - $ - Taxation on Undistributed Earnings - 4,120 Adjustment on prior years ( 8,024) ( 12,683) ( 8,024) ( 8,563) Deferred tax Income tax expense generated in the current year $ 3,418 ( $ 4,635 ) Adjustment on prior years 618 ( 16,683) 4,036 ( 21,318) Income tax profit recognized in profit or loss ($ 3,988) ($ 29,881) A reconciliation of accounting income and income tax expense is as follows: 2024 2023 Income tax benefit calculated at the statutory rate ($ 34,443 ) ($ 37,268 ) Permanent differences ( 4,055 ) 32,633 Temporary differences ( 3,416 ) 3,642 Current period loss carryforward - 993 Unrecognized loss carryforwards 41,914 - Taxation on Undistributed Earnings - 4,120 Deferred tax Income tax expense generated in the current year 3,418 ( 4,635 ) Adjustment on prior years 618 ( 16,683 ) Adjustment on prior years ( 8,024) ( 12,683) Income tax profit recognized in profit or loss ($ 3,988) ($ 29,881)		2023
		$ - 4,120 12,683) 8,563) $ 4,635 ) 16,683) 21,318) $ 29,881) follows: 2023
	($ 37,268 ) 32,633 3,642 993 - 4,120 ( 4,635 ) ( 16,683 ) ( 12,683) ($ 29,881)

(2) Deferred tax assets and liabilities

2024 Deferred tax income assets Temporary differences Inventory falling price reserves Supply Inventory falling price reserves Payables for annual leave Provision for liabilities Difference on depreciation methods Foreign exchange loss Loss carryforwards (Continued on next page)	Balance at the beginning of the year $ 14,424 1,640 10,600 1,108 - 541 28,313 138,073 $ 166,386	Adjustment at the beginning of theyear $ - - - - - ( 618) ($ 618)	Defined benefit costs recognized inprofit or loss ( $ 2,556 ) ( 189 ) 283 ( 394 ) 61 ( 541) ( 3,336 ) - ($ 3,336)	Defined benefit costs recognized in other comprehensive income $ - - - - - - - - $ -	Balance at the end of theyear	Balance at the end of theyear
		( (	( ( ( ( ( (			$ 11,868 1,451 10,883 714 61 - 24,977 137,455 $ 162,432

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(Continued from previous page)

2024 Deferred income tax liabilities Temporary differences Defined benefit retirement plans Difference on depreciation methods Foreign exchange gain 2023 Deferred tax income assets Temporary differences Inventory falling price reserves Supply Inventory falling price reserves Payables for annual leave Provision for liabilities Foreign exchange loss Loss carryforwards Deferred income tax liabilities Temporary differences Defined benefit retirement plans Difference on depreciation methods	Balance at the beginning of the year $ 18,628 104 - $ 18,732 $ 13,393 - 9,899 1,107 138 24,537 120,631 $ 145,168 $ 18,482 204 $ 18,686	Adjustment at the beginning of theyear $ - - - $ - $ - 234 - - - 234 16,449 $ 16,683 $ - - $ -		Defined benefit costs recognized inprofit or loss $ - ( 104 ) 186 $ 82 $ 1,031 1,406 701 1 403 3,542 993 $ 4,535 $ - ( 100) ($ 100)	Defined benefit costs recognized in other comprehensive income $ 17,232 - - $ 17,232 $ - - - - - - - $ - $ 146 - $ 146	Balance at the end of theyear	Balance at the end of theyear
				(			$ 35,860 - 186 $ 36,046 $ 14,424 1,640 10,600 1,108 541 28,313 138,073 $ 166,386 $ 18,628 104 $ 18,732
				( (

(3) Amount of unused loss carryforwards of deferred income tax assets which was not recognized in the individual balance sheet.

	December 31,2024	December 31,2024	December 31,2023	December 31,2023
Loss carryforwards
Due to 2034	$	209,573	$	-

(4) Relevant information on unused loss carryforwards

Final deductionyear 2028 2029 2032 2033 2034	December 31,2024 $ 122,892 384,321 174,271 3,779 209,573 $ 894,836	December 31,2023	December 31,2023
			$ 122,892 384,321 177,361 3,779 - $ 688,353

(5) The total amount of deductible temporary differences for which is relevant to invested subsidiaries and no deferred tax assets have been recognized is as follows:

December 31, 2024 December 31, 2023 $ 2,180,674 $ 2,235,208

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(6) Income tax examination

The tax authorities have examined the income tax returns of the Company through 2022.

23. Loss per share

2022. per share
2024 Basic loss per share Net loss attributed to the owners of the Company Effect of potentially dilutive ordinary shares Remuneration of employees Diluted loss per share Effect of net loss attributed to the owners of the Company plus potential ordinary shares 2023 Basic loss per share Net loss attributed to the owners of the Company Effect of potentially dilutive ordinary shares Remuneration of employees Diluted earnings per share Effect of net profit attributed to the owners of the Company plus potential ordinary shares	Net loss attributable to owners of the Company ($ 168,228) - ($ 168,228) ($ 156,458) - ($ 156,458)	Number of shares (denominator) (in thousand) 374,443 - 374,443 374,443 - 374,443	Loss per share (NT$)
				($ 0.45) ($ 0.45) ($ 0.42) ($ 0.42)

Since the Company offered to settle compensation paid to employees in cash or shares, the Company assumed the entire amount of the compensation would be settled in shares and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares was included in the computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

Due to the Company's net loss in 2024 and 2023, the calculation of diluted net loss per share without including the impact of employee compensation is anti-dilutive potential ordinary shares.

24. Capital risk management

The Company manages its capital to ensure that it is able to maximize shareholders return as a going concern through the optimization of the debt and equity balance. The overall strategy has not changed.

The Company's capital structure is consisting of net debt (leases less cash and cash equivalent) and equity (common stocks, capital surplus, retained earnings and other equity).

The Company is allowed not to follow other external laws or regulations on capital.

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The key management of the Company reviews its capital structure for each season, including the consideration on costs of every type of capital and relevant risks. Based on the key management's advice, the Company balances its overall capital structure by paying dividend payments, new shares issuance, share repurchase and new debt issuance or debt repayment, etc.

25. Financial instruments

(1) Information on fair value
1) Financial instruments that are not measured at fair value

The management of the Company considers that the carrying amounts of financial assets and liabilities that are not measured at fair value approximate its fair value or its fair value cannot be reliably measured.

2) Financial instruments that are measured at fair value on a recurring basis
i. Fair value hierarchy

December 31,2024 Financial assets at fair value through other comprehensive income Emerging stocks Listed and OTC stocks December 31,2023 Financial assets at fair value through other comprehensive income Emerging stocks Listed and OTC stocks		Level 1 $ - 2,280 $ 2,280 $ - 3,146 $ 3,146		Level 2 $ - - $ - $ - - $ -		Level 3 $ 9,582 - $ 9,582 $ 8,617 - $ 8,617		Total
								$ 9,582 2,280 $ 11,862 $ 8,617 3,146 $ 11,763

There was no transfer of fair value measurements between Level 1 and Level 2 for 2024 and 2023.

ii) Reconciliation of Level 3 fair value measurements on financial instruments

Financial assets Balance at the beginning of the year Unrealized gains (loss) from financial assets measured at fair value through other comprehensive income Balance at the end of the year	Financial assets at fair value through other comprehensive income	Financial assets at fair value through other comprehensive income	Financial assets at fair value through other comprehensive income	Financial assets at fair value through other comprehensive income
		Equityinstruments
		2024 $ 8,617 965 $ 9,582		2023
				$ 7,237 1,380 $ 8,617

iii) Valuation techniques and input value used in Level 3 fair value measurement

The securities of emerging stocks held by the Company have no market price reference and thus are evaluated under the cost approach. Its fair value is computed in reference to investment assets.

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(2) Categories of financial instruments

Categories of financial instruments
Financial assets Financial assets measured at amortized cost Financial assets at fair value through other comprehensive income Financial liabilities Amortized cost	December 31,2024 $ 2,138,446 11,862 804,865	December 31,2023
		$ 2,155,850 11,763 990,936

Balance of financial assets measured at amortized cost includes cash and cash equivalent, financial assets at amortized cost- current, contract assets, accounts receivable, other receivables and refundable deposits, and other financial assets measured at amortized cost.

Balance of financial liabilities measured at amortized cost includes short-term bank borrowings, accounts payable, other payables, long-term bank borrowings (including amount falling due in one year) and guarantee deposits received and other financial liabilities measured at amortized cost.

(3) Financial risk management objectives and policies

The majority of financial instruments include equity instrument investments, accounts receivable, accounts payable, borrowings and lease liabilities, etc. The financial management department provides service for each unit by organizing and coordinating the market operation nationally and internationally, supervising and reporting the internal risks by analyzing risk exposure according to the extent and breadth of risk, and managing financial risks associated with the Company's operation. Such risks include market risk (including foreign currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

1) Market risk

The Company is exposed to the financial market risks, primarily changes in foreign currency exchange rates and interest rates, due to its operation.

The Company is exposed to market risk associated with financial instruments and the management and measurement of such exposure have not changed.

i) Foreign currency risk

The Company's sales and purchase transactions are denominated in foreign currency, which exposes the Company to foreign currency risk. Approximately 16%~20% of sales revenue is not denominated in functional currency and approximately 54%~58% of the cost is not denominated in functional currency.

Please see Note 29 for the carrying amount of monetary assets and liabilities denominated in non-functional currency at the date of balance sheet.

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Sensitivity analysis

The Company is mainly affected by fluctuations in USD and JPY.

The following table details the Company’s sensitivity analysis to a 1% increase and decrease in NTD against the relevant foreign currency. The rate of 1% is the sensitivity rate used when reporting foreign currency risk internally to the key management and represents the management’s assessment of the reasonably likely change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and the end-of-year exchange rate is adjusted to 1% increase and decrease. The following table details the amount resulting in changes in net loss before tax to a 1% increase and decrease in NTD against the relevant foreign currency.

Impact of fluctuations in exchange rate on profit or loss

Categories of currency USD Japanese yen	2024 $ 734 18	2023
		$ 1,296 30

ii) Interest rate risk

The Company is exposed to interest rate risk for the reason that it has borrowed money at both fixed and variable rate. The Company maintains an appropriate fixed and floating rate for portfolio to manage interest rate risk. The hedge is evaluated on a regular basis, which makes its point of view and the established risk preference identical, to ensure the most efficient hedging strategy is adopted.

The carrying accounts of financial assets and liabilities exposed to interest rate risk at the date of balance sheet are as follows:

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities	December 31,2024 $ 396,851 140,111 688,533 384,298	December 31,2023 $ 439,738 145,732 624,037 583,729

Sensitivity analysis

The following sensitivity analysis is determined in accordance with interest rate risk of non-derivative instruments at the date of balance sheet. For the floating rate liabilities, the analysis is to assume that the amount of liabilities outstanding at the date of balance sheet is all outstanding at the reporting period. The rate of change is expressed as the increment or decrement by 1% when reporting to the management personnel internally of the Company, which also represents the management's assessment of the reasonable interest rate change.

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For floating-rate financial assets and liabilities, when interest rate is increase by 1% and other conditions remain unchanged, the net loss before tax of the Company in 2024 and 2023 are NT$3,042,000 and NT$403,000 respectively.

iii) Other price risk

The Company is exposed to price risk due to investments in equity secures. The management of the Company manages the risk by investing in portfolio with different risks.

Sensitivity analysis

The following sensitivity is analyzed according to the exposure to equity price risk at the date of balance sheet.

If the equity price changes by 1%, the other comprehensive income in 2024 and 2023 will increase and decrease NT$23,000 and NT$31,000 respectively due to changes in fair value of financial assets measured at fair value through profit or loss.

2) Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the Company. The maximum credit risk exposure due to the financial loss arising from the counterparty not performing its obligation and the Company's financial guarantee primarily results from:

The carrying amount of financial assets recognized in the parent company only balance sheet.
ii) The Company has given financial guarantee and not taken the maximum amount to be paid into consideration.

The Company's credit risk is mainly resulted from its five largest customers. As of December 31, 2024 and 2023, the aforementioned customers are accounted for 50% and 45% of accounts receivable and contract assets, respectively.

3) Liquidity risk

The Company manages and maintains a level of cash and cash equivalents adequate to finance the Company’s operations and mitigate the effects of fluctuations in cash flows. In addition, the management of the Company monitors the utilization of borrowings and ensures compliance with loan conditions.

The bank borrowing is a material source of liquidity to the Company. As of December 31, 2024 and 2023, the undrawn loan amounts are as follows:

Undrawn loan amounts	December 31,2024 $ 935,220	December 31,2023	December 31,2023
			$ 1,151,841

45 -

Liquidity and interest risks of non-derivative financial liabilities

The funds are adequate to the Company's operations and thus the Company is not exposed to liquidity risk and financing to meet the contractual obligations.

The maturity of the Company’s non-derivative financial liabilities which the repayment period has been committed is as follows:

December 31,2024 Non-interest bearing liabilities Lease liabilities Floating-rate liabilities December 31,2023 Non-interest bearing liabilities Lease liabilities Floating-rate liabilities		Within 1year $ 419,637 5,584 $ 344,761 $ 769,982 $ 405,307 5,514 $ 376,179 $ 787,000		1 to 3years $ 930 14,553 $ 43,953 $ 59,436 $ - 15,088 $ 224,459 $ 239,547	More than 3years	More than 3years
						$ - 143,640 $ - $ 143,640 $ - 147,516 - $ 147,516

The further information on a maturity analysis of lease liability is below:

December 31, 2024 December 31, 2023		Within 1year $ 5,584 $ 5,514		1-5years $ 23,445 $ 24,291		5~10years
						$ 134,748 $ 138,313

The amount of the aforementioned floating rate instrument of non-derivative liabilities will change resulting from the floating rate is different from the interest rate estimated at the date of balance sheet.

26. Related-party transactions

The transactions between the Company and other related parties, excluding those disclosed in other notes, are as follows:

(1) Related party name and categories

Related Party Name Relationship with the Company Lingsen America Inc. Subsidiary Ningbo Liyuan Technology Co., Ltd. Third-tier subsidiary Lee Shin Investment Co., Ltd. Subsidiary Panther Technology Co., Ltd. Subsidiary Sooner Power Semiconductor Co., Ltd. Subsidiary

Note: Ningbo Liyuan Technology Co., Ltd. was disposed of on April 25, 2024, and is no longer a related party of the Company.

(2) Operating income

Operating income
Relatedpartycategory Third-tier subsidiary		2024 $ -		2023
				$ 1,015

46 -

The operating income is from the sale of raw materials to related party and no other similar non-related party transaction can be compared. The payment will be collected at 60 days T/T following the date the goods are sold.

(3)

Purchase Relatedpartycategory Third-tier subsidiary		2024 $ 844		2023
				$ 1,898

Raw materials are purchased form related party, and no other similar non-related party transaction can be compared. The payment is collected at 30 days T/T following the date the goods are sold in principle.

(4) Operating expense - commission expense

The Company has signed a commission agreement with Lingsen America Inc. states that the Company shall pay a 2% commission on monthly sales revenue of particular exports in the U.S.A. (in USD). The commission expenses in 2024 and 2023 are NT$697,000 and NT$2,503,000, respectively. The commissions payable as of December 31 2024 and 2023 are NT$1,000 and NT$513,000, respectively.

(5) Non-operating income - rent income

Non-operating income - rent income
Related PartyCategory/Name Subsidiary		2024 $ 36		2023
				$ 36

The majority of non-operating income is rent income of office.

(6) (7)	Non-operating income - other revenue Relatedpartycategory 2024 Third-tier subsidiary $ 161 Endorsements/guarantees Company Guarantees December 31,2024 Third-tier subsidiary Bank loans $ -	2023 $ 95 December 31,2023 $USD5,000		2023
	Third-tier subsidiary

(8) Remuneration of key management personnel

Short-term employee benefits Pensions		2024 $ 24,959 400 $ 25,359		2023
				$ 28,889 400 $ 29,289

The remuneration of directors and other key management personnel were determined by the Remuneration Committee in accordance with the individual performance and the market trends.

27. Pledged assets

(1) The Company provides the following assets (Financial assets at amortized cost - current) as a deposit out for customs duties accounting:

December 31, 2024 December 31, 2023 Pledged time deposits (Financial assets at amortized cost- current) $ 1,000 $ 1,000

47 -

(2) The following assets are pledged as collaterals for bank loan limit: December 31,2024 December 31,2023 Property, plant and equipment $ 532,863 $ 777,571	(2) The following assets are pledged as collaterals for bank loan limit: December 31,2024 December 31,2023 Property, plant and equipment $ 532,863 $ 777,571	(2) The following assets are pledged as collaterals for bank loan limit: December 31,2024 December 31,2023 Property, plant and equipment $ 532,863 $ 777,571
		$ 777,571

Significant Contingent Liabilities and Unrecognized Commitments

Significant contingent commitments of the Company at the end of balance sheet, excluding those disclosed in other notes, are as follows:

(1) For customs duties guarantee and other objectives, the financial institution has provided guarantee details as follows:

		December 31,2024	December 31,2024	December 31,2023	December 31,2023
		$	28,000	$	28,000
(2)	Unrecognized commitments are as follows:
		December 31,2024		December 31,2023
	Purchase of property, plant and
	equipment	$	46,209	$	32,954
29.Significant information on exchange rate of foreign			currency financial	assets and	liabilities

The following information is summarized according to the foreign currencies other than the functional currency of the Company. The exchange rates disclosed are used to translate the foreign currencies into the functional currency. The significant financial assets and liabilities denominated in foreign currencies are as follows:

Foreign currency assets Monetary items USD Japanese yen Non-monetary items Investment accounted for using the equity method USD Foreign currency liabilities Monetary items USD Japanese yen	December31,2024 Foreign Currency Exchange rate NTD $ 11,303 32.785 $ 370,569 177,004 0.2099 37,153 12,187 32.785 399,549 9,063 32.785 297,130 185,817 0.2099 39,003	December31,2024 Foreign Currency Exchange rate NTD $ 11,303 32.785 $ 370,569 177,004 0.2099 37,153 12,187 32.785 399,549 9,063 32.785 297,130 185,817 0.2099 39,003	December31,2023	December31,2023	December31,2023
	Foreign Currency $ 11,303 177,004 12,187 9,063 185,817	Exchange rate 32.785 0.2099 32.785 32.785 0.2099	Foreign Currency $ 10,384 68,123 6,323 6,163 54,338	Exchange rate 30.705 0.2172 30.705 30.705 0.2172	NTD
					$ 318,841 14,796 194,147 189,235 11,802

48 -

Significant unrealized exchange gains (losses) are as follows:

Foreign Currency USD Japanese yen	2024	Net exchange gains (losses) $ 1,431 ( 500) $ 931	2023
	Exchange rate 32.785(USD : NTD) 0.2099(JPY: NTD)		Exchange rate 30.705 (USD : NTD) 0.2172 (JPY: NTD)	Net exchange gains (losses)
		(		( $ 2,584 ) ( 123) ($ 2,707)

30. Other disclosures

(1) Information on significant transactions:
1) Financing provided to others: None.
2) Endorsements/guarantees provided: Table 1.
3) Marketable securities held (excluding investment in subsidiaries, associates): Table 2.
4) Marketable securities acquired and disposed at costs or prices at least NT$300 million or 20% of the paid-in capital: None.
5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in capital: None.
6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital: None.
7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital: None.
8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital: None.
9) Trading in derivative instruments: None.
10) Other: None.
(2) Information on investees: Table 3.
(3) Information on Investment in Mainland China
1) The name of the investee in mainland China, the main businesses and products, its issued capital, method of investment, information on inflow or outflow of capital, percentage of ownership, income (losses) of the investee, share of profits/losses of investee, ending balance, amount received as dividends from the investee, and the limitation on investee: Table 4.
49 -
2) Significant direct or indirect transactions through a third area with the investee in the Mainland Area, and its prices and terms of payment, unrealized gain or loss are as follows:
- i) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period: None.
- ii) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period: None.
- iii) The amount of property transactions and the amount of the resultant gains or losses: None.
- iv) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes: Table 1.
- v) The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds: None.
- vi) Other transactions that have a material effect on the profit or loss for the period or on the financial position, such as the rendering or receiving of services: Note 26.
(4) Information of major shareholders: names, numbers of shares held, and shareholding percentages of shareholders who hold 5% or more of the equity: Table 5.
50 -

Lingsen Precision Industries, Ltd. and Subsidiaries

Endorsements/guarantees provided

For the year ended December 31, 2024

Table 1

Unit: Amounts expressed in New Taiwan Dollars and in thousands of foreign currency

No.	Endorsement/ guarantee provider	Guaranteed party	Guaranteed party	Limits on endorsement/g uarantee amount provided to each guaranteed party (Note)	Maximum balance for the period	Ending balance	Amount actually drawn	Amount of Endorsement/ Guarantee Collateralized by Properties	Ratio of accumulated endorsement/g uarantee to net equity per latest financial statements(%)	Maximum amount of endorsement/g uarantee allowance (Note)	Guarantee provided by parent company	Guarantee provided by subsidiary	Guarantee provided to subsidiaries in Mainland China
		Company Name	Relationship
0	Parent Company	Ningbo Liyuan Technology Co., Ltd.	Third-tier subsidiary	$ -	$ 160,000 (USD5,000)	$ - (USD -)	$ - (USD -)	$ -	-	$ -	Y	-	Y

Note 1: Limits on endorsement/guarantee amount provided to each guaranteed party shall not exceed 15% of the net worth and maximum amount allowance shall not exceed 30% of the net worth. Note 2: Please see Note 11.

51 -

Lingsen Precision Industries, Ltd. and its subsidiaries

Marketable securities held

December 31, 2024

Table 2

Unit: Amounts expressed in thousands of New Taiwan Dollars/ shares

Holding company name	Marketable securities types and name	Relationship with the issuers	Financial statement account		End ofyear	End ofyear
				Shares/Units	Carrying amount	Shareholding %	Fair value (Note 3)
Parent Company Lee Shin Investment Co., Ltd.	Stock Amtek Semiconductors Co., Ltd. ETREND Hightech Corp. Xpert Semiconductor Inc. Stock The Company Enrich Tech CO., Ltd. ETREND Hightech Corp.	None None None Parent company None None	Financial assets at fair value through other comprehensive income- non-current Financial assets at fair value through other comprehensive income- non-current Financial assets at fair value through other comprehensive income- non-current Financial assets at fair value through other comprehensive income- non-current Financial assets at fair value through other comprehensive income- non-current Financial assets at fair value through other comprehensive income- non-current	685,464 75,000 44,891 5,658,911 2,467,186 150,000	$ 9,582 2,280 - 100,446 25,927 4,560	2 - - 1 19 -	$ 9,582 2,280 - 100,446 25,927 4,560

Note 1: Please see Table 3 and 4 for related information on investment in subsidiaries.

Note 2: Fair value of investment in emerging stocks is computed in reference to investment assets under the cost approach.

52 -

Lingsen Precision Industries, Ltd. and its subsidiaries

Information on investees

For the year ended December 31, 2024

Table 3						Unit: Amounts expressed in	Unit: Amounts expressed in	Unit: Amounts expressed in	thousands of New Taiwan Dollars/ shares	thousands of New Taiwan Dollars/ shares
Investor	Investee	Location	Main business	Initial investment amount		Balance	at December 31,2023		Current income (losses) of the investee	Share of income (losses) recognized
				End of current year	End of last year	Number of shares	Ratio %	Carrying amount
Parent Company Lee Shin Investment Co., Ltd. Lingsen Holding (Samoa) Inc.	Lingsen Holding (Samoa) Inc. Panther Technology Co., Ltd. Sooner Power Semiconductor Co., Ltd. Lee Shin Investment Co., Ltd. (Note`１`) Nexus Material Corporation (Note 2) Lingsen America Inc. Qi Feng Technology Co., Ltd. (Note 2) Sooner Power Semiconductor Co., Ltd. Nexus Material Corporation Li Yuan Investments Co., Ltd.	Samoan Islands Hsinchu County, Taiwan Hsinchu County, Taiwan Taichung City Hsinchu County, Taiwan California, U.S.A. Taichung City Hsinchu County, Taiwan Hsinchu County, Taiwan Cayman Islands	General investments IC testing Electronic parts and components manufacturing General investments Wholesale of electronic materials and electronic parts and components manufacturing Intermediary Electronic parts and components production and processing Electronic parts and components manufacturing Wholesale of electronic materials and electronic parts and components manufacturing General investments	$ 1,909,488 230,146 215,148 300,000 53,483 32,311 24,000 912 14,192 $ 1,909,488	$ 1,846,348 230,146 215,148 300,000 53,483 32,311 24,000 912 14,192 $ 1,846,348	60,000,000 22,922,899 21,514,797 30,000,000 5,348,315 1,000,000 2,400,000 98,660 1,419,214 60,000,000	100 64 99 100 78 100 30 1 21 100	$ 329,329 350,642 230,378 78,304 20,925 70,220 - 1,056 5,552 329,329	$ 100,253 ( 90,714 ) 10,301 1,749 108 ( 9 ) - 10,301 108 100,253	$ 100,253 ( 57,757 ) 10,213 1,749 85 ( 9 ) - 47 22 100,253

Note 1: Treasury stocks have been deducted from the carrying amount of Lee Shin Investment Co., Ltd.

Note 2: Accumulated impairment loss has been deducted from the carrying amount of Nexus Material Corporation and Qi Feng Technology Co., Ltd. Note 3: See Table 4 for related information on investee in Mainland China.

53 -

Lingsen Precision Industries, Ltd. and Subsidiaries

Information on Investment in Mainland China

For the year ended December 31, 2024

Table 4

Unit: Amounts expressed in New Taiwan Dollars and in thousands of foreign currency

Name of Investee in Mainland China	Main business	Paid-in capital	Investment method	Accumulated investment amount of outflow from Taiwan at the beginning of theyear	Outward remittance or repatriation of investment amount at beginningof theyear	Outward remittance or repatriation of investment amount at beginningof theyear	Accumulated investment amount of outflow from Taiwan at the end of the year	Current income (losses) of the investee	Ownership percentage of direct or indirect investment	Investment gains (losses) recognized for the year (Note 2)	Book value of investment at the end of year	Inflow of investment revenue to Taiwan upon the end of the year
					Outward remittance	Repatriation
Ningbo Liyuan Technology Co., Ltd.	IC packing and testing as well as optoelectronic devices	USD 60,000	(Note 1)	$ 1,846,348 ( USD 58,000 )	$ 63,140 ( USD 2,000 )	$ -	$ 1,909,488 ( USD 60,000 )	( $ 64,360 )	100%	( $ 64,360 )	$ -	$ -

					limitation on investee regulated under Investment Commission, MOEA (Note 3) $ 3,288,010
Accumulated investment amount of outflow in China mainland from Taiwan at the end of theyear		Investment amount approved by Investment Commission, MOEA (Note 5)			limitation on investee regulated under Investment Commission, MOEA (Note 3)
$ 1,909,488 ( USD 60,000 )		USD -			$ 3,288,010

Note 1: Investment in Mainland China companies through a company invested and established in a third region. Note 2: Investment in profit or loss in accordance with reports audited by the CPA from the parent company. Note 3: Limitation is calculated under 'Regulations Governing the Examination of Investment or Technical Cooperation in Mainland China'. Note 4: Ningbo Liyuan was disposal for the Group Company on April 25, 2024. The proceeds from the sale are still retained in Li Yuan Company and have not yet been repatriated to Taiwan. Note 5: Investment Commission, MOEA approved the cancellation of the investment amount on July 30, 2024.

54 -

Lingsen Precision Industries, Ltd.

Information of Major Shareholders December 31, 2024

Table 5

Name of major shareholder	Shares	Shares
	Total shares held (shares)	Shareholding percentage
Trust account in CTBC Bank for ESOP committee of Lingsen Precision Industries, ltd.	22,755,425	5.98%

Note 1: This table is based on the information provided by the Taiwan Depository & Clearing Corporation for shareholders holding greater than five percent of the shares completed the process of registration and book-entry delivery in dematerialized form, including treasury stocks, at the last business date of current quarter. There may be a discrepancy in the number of shares recorded on the parent company only financial statements and its dematerialized securities arising from the difference in basis of preparation.
Note 2: As table above, the shareholder who delivers the shares to the trust is disclosed by the individual trustee who opened the trust account. In accordance with the Security Exchange Act, the shareholders have to disclose the insider equity more than 10% of the shares, including their own shares and their delivery to the trust, and have the right to make decisions on the trust property. Information on insider equity is available on the Market Observation Post System (MOPS) website.
55 -

§Statements of Major Accounting Items

Item
Statements of assets, liabilities, and equity items
Statement of cash and cash equivalents
Statement of accounts receivable
Statement of inventories
Statement of other current assets
Statement of changes in financial assets measured at fair value
throughother comprehensive income- non-current
Statement of changes in investments accounted for using the
equity method
Statement of changes in property, plant and equipment
Statement of changes in right-of-use assets
Statement of deferred tax assets
Statement of short-term borrowings
Statement of accounts payable
Statement of other payables
Statement of provisions - current
Statement of lease liabilities
Statement of long-term borrowings
Statement of deferred tax liabilities
Statements of profit or loss items
Statement of operating revenue
Statement of operating costs
Statement of operating expenses
Summary statement of current period employee benefits and
depreciation expenses by function

No./Index
Table 1
Table 2
Table 3
Note 14
Table 4
Table 5
Note 12
Table 6
Note 22
Table 7
Table 8
Note 16
Note 17
Table 9
Table 10
Note 22
Table 11
Table 12
Table 13
Note 21

56 -

Lingsen Precision Industries, Ltd.

Statement of cash and cash equivalents

December 31, 2024

Table 1

Unit In Thousands of New Taiwan Dollars,

Unless Stated Otherwise

Item Cash Cash on hand and petty cash Cash in banks Checking accounts Demand deposits Foreign currency demand deposit (Note 1) Time deposits Cash equivalents Time deposits with an initial maturity of less than three months Short-term notes and bills Less: Time deposits with an initial maturity in three months Time deposit pledge (Note 2)		Amount
	$ 273 1,963 255,015 88,518 161,000 506,769 431,000 149,851 1,087,620 ( 160,000 ) ( 1,000) $ 926,620

Note 1: It includes US$1,567,000 and JPY 177,004,000, converted at the exchange rate of ＝＝
US$1 NT$32.785 and JPY$1 NT$0.2099.
Note 2: The due period is May 2025, at an annual percentage rate of 1.575%. It has been provided to the bank as collateral, transferred to financial assets at amortized costcurrent, to make endorsement and guarantee for Taipei Customs, CA, MOF.
57 -

Lingsen Precision Industries, Ltd.

Statement of accounts receivable

December 31, 2024

December 31, 2024	December 31, 2024	December 31, 2024
Table 2 Unit: Amounts expressed in thousands of New Taiwan Dollars Customer name Amount Company A $ 147,816 Company B 147,490 Company C 138,570 Company D 76,272 Company E 70,724 Company F 49,861 Company G 48,879 Others (Note) 259,044 938,656 Less: Allowance for bad debts ( 1,410) $ 937,246
	(	$ 147,816 147,490 138,570 76,272 70,724 49,861 48,879 259,044 938,656 1,410) $ 937,246

Unit: Amounts expressed in thousands of New Taiwan Dollars

Note: The amount of individual customer does not exceed 5% of the account balance.

58 -

Lingsen Precision Industries, Ltd.

Statement of inventories December 31, 2024

Table 3 Item Raw materials Finished goods Work in process Less: falling price reserves (	Unit: Amounts expressed in thousands of New Taiwan Dollars Cost Net realizable value $ 324,607 $ 270,075 2,253 - 2,554 - 329,414 $ 270,075 59,339) $ 270,075	Unit: Amounts expressed in thousands of New Taiwan Dollars Cost Net realizable value $ 324,607 $ 270,075 2,253 - 2,554 - 329,414 $ 270,075 59,339) $ 270,075
		$ 270,075 - - $ 270,075

59 -

Lingsen Precision Industries, Ltd.

Statement of changes in financial assets measured at fair value through other comprehensive income - non-current

For the year ended December 31, 2024

Table 4

Unit: Amounts expressed in thousands of New Taiwan Dollars and thousands of shares

Financial instrument name Listed domestic company ETREND Hightech Corp. Emerging stocks Amtek Semiconductors Co., Ltd. Xpert Semiconductor Inc.	Balance at the beginning	Balance at the beginning	of theyear Fair value $ 3,146 8,617 - 8,617 $ 11,763	Unrealized gains or losses of Financial assets ($ 866) 965 - 965 $ 99	Balance at the end of theyear Number of shares Fair value 75 $ 2,280 685 9,582 45 - 9,582 $ 11,862	Balance at the end of theyear Number of shares Fair value 75 $ 2,280 685 9,582 45 - 9,582 $ 11,862	Guarantee or pledge status
	Number of shares 75 685 45				Number of shares 75 685 45
				(			None None None

60 -

Lingsen Precision Industries, Ltd.

Statement of changes in investments accounted for using the equity method

For the year ended December 31, 2024

Table 5

Unit: Amounts expressed in thousands of New Taiwan Dollars and thousands of shares

Investee Lingsen Holding (Samoa) Inc. Panther Technology Co., Ltd. Sooner Power Semiconductor Co., Ltd. Lee Shin Investment Co., Ltd. Lingsen America Inc. Nexus Material Corporation Qi Feng Technology Co., Ltd. Less: Transferred treasury shares Accumulated impairment loss	Balance at the beginningof theyear Number of shares Amount 58,000 $ 128,390 22,923 408,399 21,515 220,165 30,000 249,741 1,000 65,773 5,348 27,154 2,400 11,417 1,111,039 ( 176,415 ) ( 17,731) $ 916,893	Balance at the beginningof theyear Number of shares Amount 58,000 $ 128,390 22,923 408,399 21,515 220,165 30,000 249,741 1,000 65,773 5,348 27,154 2,400 11,417 1,111,039 ( 176,415 ) ( 17,731) $ 916,893	Increase(Decrease) Number of shares Amount 2,000 $ 63,140 - - - - - - - - - - - - $ 63,140	Increase(Decrease) Number of shares Amount 2,000 $ 63,140 - - - - - - - - - - - - $ 63,140	Gains (losses) of investments $ 100,253 ( 57,757 ) 10,213 1,749 ( 9 ) 85 - $ 54,534		Capital surplus $ - - - 1,698 - - - $ 1,698	Exchange differences on translation of the financial statements of foreign operations $ 37,546 - - - 4,456 - - $ 42,002	Unrealized gains or losses of Financial assets $ - - - 1,531 - - - $ 1,531	Balance at the end of the	Balance at the end of the	year Amount $ 329,329 350,642 230,378 254,719 70,220 27,239 11,417 1,273,944 ( 176,415 ) ( 17,731) $ 1,079,798	Market value or equitynet value	Market value or equitynet value
	Number of shares 58,000 22,923 21,515 30,000 1,000 5,348 2,400		Number of shares 2,000 - - - - - -							Number of shares 60,000 22,923 21,515 30,000 1,000 5,348 2,400	Shareholding `％` 100 64 99 100 100 78 30			(Note)
														$ 329,329 350,642 230,378 78,304 70,220 20,925 - $ 1,079,798

Note: Net income or loss is primarily computed according to investee's financial statement and the percentage of the Company's share.

61 -

Lingsen Precision Industries, Ltd.

Statement of Changes in Right-of-use Assets and Accumulated Depreciation For the year ended December 31, 2024

Unit: Amounts expressed in thousands of New Taiwan Dollars

Table 6 Unit: Amounts expressed

in thousands of New Taiwan Dollars

Cost Land Buildings Accumulated depreciation Land Buildings	Balance at the beginning of theyear $ 163,712 4,509 168,221 21,735 3,227 24,962 $ 143,259		Increase $ - - - $ 4,189 641 $ 4,830	Decrease ( $ 1,283 ) - ( 1,283) $ - - $ -	Balance at the end of the year	Balance at the end of the year
						$ 162,429 4,509 166,938 25,924 3,868 29,792 $ 137,146

62 -

Lingsen Precision Industries, Ltd.

Statement of short-term borrowings

December 31, 2024

Table 7

Unit: Amounts expressed in thousands of

New Taiwan Dollars

Loan type and bank Import/export financing loans The Hongkong and Shanghai Banking Corporation Limited (Taichung Branch) Taipei Fubon Bank (Zhonggang Branch) Mega International Commercial Bank (Tan Zi Branch)	Maturity date (Note) 2025.03.28 2025.03.30 2025.01.28	Annual interest rate(%) 5.44 5.37 5.24		Amount
				$ 55,946 49,652 24,838 $ 130,436

Note: The maturity date refers to the last maturity date among several loans.

63 -

Lingsen Precision Industries, Ltd.

Statement of accounts payable December 31, 2024

Table 8		Unit: Amounts expressed in thousands of	Unit: Amounts expressed in thousands of
		New Taiwan Dollars
	Companyname		Amount
Company A		$	51,935
Company B			36,303
Company C			34,585
Company D			27,975
Others (Note)			72,760
		$	223,558

Unit: Amounts expressed in thousands of New Taiwan Dollars

Note: The amount of individual customer does not exceed 5% of the account balance.

64 -

Lingsen Precision Industries, Ltd.

Statement of lease liabilities

December 31, 2024

Table 9 Item Land Buildings Less: Amount falling due in one year	Description Plant and office Plant and office	Unit: Amounts expressed in thousands of New Taiwan Dollars Lease term Discount rate (%) Balance at the end of theyear 2014.11.01-2034.10.31 0.67-1.55 $ 139,459 2023.01.01-2025.12.31 1.50 651 140,110 ( 4,376) $ 135,734	Unit: Amounts expressed in thousands of New Taiwan Dollars Lease term Discount rate (%) Balance at the end of theyear 2014.11.01-2034.10.31 0.67-1.55 $ 139,459 2023.01.01-2025.12.31 1.50 651 140,110 ( 4,376) $ 135,734	Unit: Amounts expressed in thousands of New Taiwan Dollars Lease term Discount rate (%) Balance at the end of theyear 2014.11.01-2034.10.31 0.67-1.55 $ 139,459 2023.01.01-2025.12.31 1.50 651 140,110 ( 4,376) $ 135,734
			(	$ 139,459 651 140,110 4,376) $ 135,734

65 -

Lingsen Precision Industries, Ltd.

Statement of long-term borrowings

December 31, 2024

Table 10

Unit: Amounts expressed in thousands of New Taiwan Dollars

Loan type and bank Mortgage loan Mega International Commercial Bank (Tan Zi Branch) Credit loans CTBC Bank (Taichung Regional Center) Taipei Fubon Bank (Zhonggang Branch) O-Bank (Taichung Branch)	Loan period 2022.08.22-2025.06.26 2021.03.05-2026.03.05 2021.05.20-2026.05.20 2021.04.26-2026.04.15	Repayment method The maximum repayment period for each transaction shall not exceed the expiry date of the utilization period, and the principal shall be repaid once due. Grace period refers to 18 months from the first drawdown date. Starting from October 15, 2023, the equal principle shall be paid on the 15th day of each month, and the remaining amount shall be repaid at a lump sum upon maturity, and interest is collected on a monthly basis. Grace period refers to the first 2 years of the 60 months from the first drawdown date. Starting from the 3rd year, the equal principle shall be paid on the 15th day of each month. Grace period refers to 36 months from the first drawdown date. The equal principle shall be paid on the 15th day of each month, and divided into 25 periods for payment.	Annual interest rate 1.91% 1.58% 1.51% 1.66%	Amount falling due in oneyear $ 37,500 96,596 28,000 48,000 $ 210,096	Amount falling due in oneyear $ 37,500 96,596 28,000 48,000 $ 210,096	Amount falling due after oneyear $ - 16,099 11,667 16,000 $ 43,766		Total
								$ 37,500 112,695 39,667 64,000 $ 253,862

66 -

Lingsen Precision Industries, Ltd. Statement of operating revenue

For the year ended December 31, 2024

Table 11

Unit: Amounts expressed in thousands of New Taiwan Dollars

Item Packaging and final testing of IC Revenue from contracts with customers Other operating income Less: Sales allowance Operating income	Quantity (thousand PCS) Around 3,732,128		Amount
		(	$ 4,499,901 102,190 37,200 4,639,291 27,433) $ 4,611,858

67 -

Lingsen Precision Industries, Ltd.

Statement of operating costs

For the year ended December 31, 2024

Table 12

Unit: Amounts expressed in thousands of New Taiwan Dollars

New Taiwan Dollars

Item
Raw material at the beginning of year
Current net purchase
Raw material at the end of year
Sales of raw materials
Other expenses
Raw material consumption
Direct labor
Production overheads
Production cost
Work in process at the beginning of the year
Work in process at the end of the year
Cost of finished goods inventory
Finished goods inventory at the beginning of the
year
Finished goods inventory at the end of the year
Cost of sales
Income from sale of scrap
Inventory valuation gain from price recovery
Supply inventory valuation gain from price
recovery
Cost of sales of raw materials
Others
Operating costs

Amount

$ 343,276
1,644,699
(
324,607 )
(
34,115 )
(
10,541)
1,618,712
768,783

2,244,079
4,631,574
2,554
(
2,554)
4,631,574
2,253
(
2,253)
4,631,574
(
47,501 )
(
12,778 )
(
944 )
34,115

269
$ 4,604,735

68 -

Lingsen Precision Industries, Ltd. Statement of operating expenses For the year ended December 31, 2024

Table 13

Unit: Amounts expressed in thousands of New Taiwan Dollars

Item Salary expense Depreciation Insurance expense Commissions expense Others		Selling expenses $ 26,973 325 2,929 1,439 13,046 $ 44,712	Administrativ e expenses $ 69,761 10,453 8,053 - 59,429 $ 147,696	Research and development expenses $ 73,003 828 7,285 - 13,879 $ 94,995		Total
						$ 169,737 11,606 18,267 1,439 86,354 $ 287,403

69 -

AI assistant

LPI — Audit Report / Information 2024

52036_rns_2024-11-08_a948d7f1-be44-4142-b3b6-9ed63a1919cd.pdf

Lingsen Precision Industries, Ltd.

Parent Company Only Financial Statements and Independent Auditors’ Report

Independent Auditors’ Report

Audit opinions

Basis for Opinion

Key Audit Matters

Authenticity of service revenue recognition

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

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

Lingsen Precision Industries, Ltd. Parent Company Only Balance Sheets December 31, 2024 and 2023

Lingsen Precision Industries, Ltd.

Parent Company Only Statements of Comprehensive Income

(Continued from previous page)

Lingsen Precision Industries, Ltd. Parent Company Only Statement of Changes in Equity For the Years from January 1 to December 31, 2024 and 2023

(Continued from previous page)

1. Company History

2. Approval Date and Procedures of the Financial Statements

3 . Application of New, Amended and Revised Standards and Interpretations

IFRS 18 “Presentation and Disclosure in Financial Statements”

4. Summary of Significant Accounting Policies

(7) Investment in Associates

(10) Financial instruments

Financial assets

3) Derecognition of financial assets

Financial liabilities

1) Follow-up measurement

(11) Provision for liabilities

(12) Revenue recognition

1) Sales revenue

(13) Leases

1) Short-term employee benefits

(16) Income tax

1) Current tax

5. Significant Accounting Assumptions and Judgment, and Major Sources of Estimation Uncertainty

Major source of estimates and assumption uncertainty

6. Cash and cash equivalents

7. Financial assets at fair value through other comprehensive income- non-current

8. Financial assets at amortized cost- current

9. Accounts receivable

10. Inventories

11. Investments accounted for using the equity method

12. Property, Plant and Equipment

(4) Information on other lease

14. Other current assets

15. Borrowings

16. Other payables

17. Provisions - Current

18. Retirement benefits plan

(1) Defined contribution plans

19. Equity

(2) Capital surplus

(3) Retained earnings and dividend policy

20. Revenue

(2) Timing of revenue recognition

21. Employee benefits and depreciation expenses

The Company's remuneration policy

22. Income tax

(2) Deferred tax assets and liabilities

(6) Income tax examination

23. Loss per share

24. Capital risk management

25. Financial instruments

1) Market risk

i) Foreign currency risk

Sensitivity analysis

Sensitivity analysis

iii) Other price risk

Sensitivity analysis

2) Credit risk

3) Liquidity risk

Liquidity and interest risks of non-derivative financial liabilities

26. Related-party transactions

(3)

27. Pledged assets

30. Other disclosures

Lingsen Precision Industries, Ltd. and Subsidiaries

Endorsements/guarantees provided

LPI Audit Report / Information 2024