LUXE — Annual Report 2022

Nov 10, 2022

Stock Code: 1529

Luxe Green Energy Technology Co., Ltd. (Originally: Luxe Electric Co., Ltd) Consolidated Financial Statements

for FY2022 and FY2021 and Independent Auditors’ Report

Address: 7F.-1, No. 114, Chenggong Rd., North Dist., Tainan City Tel.:(06) 221-7189

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Luxe Green Energy Technology Co., Ltd. and its subsidiaries (Originally: Luxe Electric Co., Ltd)

Consolidated Financial Statements Table of Contents

FY2022 and FY2021

Item I. Cover II. Table of Contents III. Statement of Consolidated Financial Statements of Affiliated Companies IV. Independent Auditors’ Report V. Consolidated Balance Sheet VI. Consolidated Statement of Comprehensive Income VII. Consolidated Statement of Changes in Equity VIII. Consolidated Statement of Cash Flow IX. Notes to the Consolidated Financial Statements (I) Corporate history (II) Date and Procedure for Approval of Financial Statements (III) Application of Newly Issued and Revised Standards and Interpretations (IV) Summary of Significant Accounting Policies (V) Significant Accounting Judgments, Estimates and Key Sources of Assumption Uncertainty (VI) Description of Significant Accounting Items (VII) Related Party Transactions (VIII) Assets Pledged as Collateral (IX) Significant Contingent Liabilities and Unrecognized Contractual Commitments (X) Catastrophic Losses (XI) Significant Post-Term Events (XII) Others (XIII) Notes for Disclosures 1. Information on Material Transactions 2. Information on Intercorporate Investments 3. Investments in Mainland China 4. Name of Major Shareholders (XIV) Department Information

Page

1 2 3 4～7 8～9 10 11 12～13 14 14 14～15 15～24 24 25～47 48～50 51 51～53 53 53 53 53 53 53 53 53

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Statement of Consolidated Financial Statements of Affiliated Companies

Considering that the companies to be included into the consolidated financial statements of affiliated companies under the “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports, and Consolidated Financial Statements of Affiliated Enterprises” were the same as those to be included into the consolidated financial statements of the parent and subsidiaries under IFRS 10 in 2022 (from January 1 to December 31, 2022), and the related information to be disclosed in the consolidated financial statements of affiliated companies has already been disclosed in the said consolidated financial statements of the parent and subsidiaries. We hereby declare that consolidated financial statements of affiliated companies were prepared separately.

Company Name: Luxe Green Energy Technology Co., Ltd. and its subsidiaries

Chairman: Chen Chien-Jen

Februar 21, 2023

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Independent Auditors’ Report

NO.23861110CA

LUXE GREEN ENERGY TECHNOLOGY CO., LTD.:

Audit opinions

We have audited the consolidated balance sheet of Luxe Green Energy Technology Co., Ltd. and its subsidiaries (collectively referred to as the “Group”) as of December 31, 2022 and 2021, and the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flow for the period from January 1 to December 31, 2022 and 2021, and provided the related notes to the consolidated financial statements (including the summary of significant accounting policies).

In our opinion, the said consolidated financial statements were prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and the International Financial Reporting Standards, International Accounting Standards, interpretations and the statements of interpretation approved and released by the Financial Supervisory Commission, and thus presented fairly in all material aspects, the consolidated financial position of Luxe Green Energy Technology Co., Ltd. and its subsidiaries as of December 31, 2022 and 2021, and the consolidated financial performance and consolidated cash flows for the period from January 1 to December 31, 2022 and 2021.

Basis of audit opinion

We conducted our audit in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and the prevailing Generally Accepted Auditing Standards. Our responsibilities under such standards are further described in the “CPA’s responsibility for the audit of the consolidated financial statements” section in this report. We are independent of Luxe Green Energy Technology Co., Ltd. and its subsidiaries in accordance with the Norms of Professional Ethics for Certified Public Accountants and fulfilled all other responsibilities thereunder. We believe that we acquired sufficient and appropriate audit evidence to base our audit opinions.

Other matters

For the parent company only financial statements prepared by Luxe Green Energy Technology Co., Ltd. in FY2022 and FY2021, we had an independent auditors’ report issued with unqualified opinions for reference.

Key audit matters

Key audit matters is one that, in our professional judgment, is most significant in relation to our audit of the consolidated financial statements of Luxe Green Energy Technology Co., Ltd. and its subsidiaries for the year ended December 31, 2022. Such matters were addressed during the overall audit of the consolidated financial statements and the process of forming the audit opinions, and thus we did not provide opinions separately regarding such matters.

The following is a summary of the key audit matters of the consolidated financial statements of Luxe Green Energy Technology Co., Ltd. and its subsidiaries in FY2022:

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Construction contracts

As stated in Notes 4(13) and 6(20) to the consolidated financial statements, Luxe Green Energy Technology Co., Ltd. and its subsidiaries' project revenue for FY2022 amounted to NT$83,617 thousand, which accounted for 30% of the total net operating revenue and had a significant impact on the consolidated financial statements. The project revenue of Luxe Green Energy Technology Co., Ltd. and its subsidiaries is recognized through the cost input ratio of project cost, based on the gradual satisfaction of performance obligations over time. In view of the fact that the estimated total cost of uncompleted construction projects and the construction cost invested will impact the accuracy of the recognition of construction revenue, we have included the area in the key audit matters of the year.

The major audit procedures we conducted for this key audit matter include:

• I. Understanding and examining the effectiveness of the design and implementation of the internal control system related to the estimated total construction cost and the recognition of relevant construction revenue.

• II. Sampling the construction project progress schedule, construction contracts and construction cost invested in the current period, and re-calculating the percentage of the completed construction, in order to verify the accuracy of the recognition of construction revenue.

- Long term project payment receivables involving any unsettled litigation

As disclosed in Notes 5 and 6(13) to the consolidated financial statements, as of December 31, 2022, the long-term project receivables of Luxe Green Energy Technology Co., Ltd. and its subsidiaries amounted to NT$207,991 thousand (net of allowance for losses of NT$178,575 thousand and estimated late penalties). Because of the uncertain outcome of the pending litigation, the recoverable amount of the long-term project receivables involves management's assumptions about the final judgment of the court. Accordingly, we have considered the above long-term receivables as a key audit matter.

The major audit procedures we conducted for this key audit matter include:

• I. Reviewing the recent verdict documents of the litigation and obtaining the legal confirmation of the appointed lawyer of the litigation to evaluate the reasonableness of the management’s assumption.

• II. Evaluating the completeness of the disclosure of this lawsuit by Luxe Green Energy Technology Co., Ltd. and its subsidiaries.

Responsibility of the management and governance unit for the consolidated financial statements

The management was responsible for preparation of the consolidated financial statements with fair presentation in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, interpretations and the statements of interpretation approved and released by the Financial Supervisory Commission and maintaining the necessary internal control related to preparation of the consolidated financial statements to ensure that the consolidated financial statements were free of material misstatement due to fraud or errors.

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In preparing the consolidated financial statements, management's responsibility also includes evaluating the ability of Luxe Green Energy Technology Co., Ltd. and its subsidiaries to continue as a going concern, the related disclosures, and the basis of accounting for going concern, unless management intends to liquidate the Group or to cease operations, or there is no practical alternative to liquidation or cessation of operations.

The governance unit (including the Audit Committee) of Luxe Green Energy Technology Co., Ltd. and its subsidiaries assumes the responsibility of overseeing the financial reporting process.

CPA’s responsibility for the audit of the consolidated financial statements

We audited the consolidated financial statements for the purpose of obtaining reasonable assurance about whether the consolidated financial statements were free of material misstatement due to fraud or errors and issuing an audit report. However, an audit performed in accordance with generally accepted auditing standards does not provide assurance that material misstatements in consolidated financial statements can be detected. The misstatements might be due to fraud or errors. If an individual or total amount misstated was reasonably expected to have an impact on the economic decision-making of users of the consolidated financial statements, the misstatements were deemed material.

We conducted our audit in accordance with generally accepted auditing standards and applied our professional judgment and professional skepticism. We also performed the following works:

• I. Identify and assess the risks of material misstatement of consolidated financial statements, whether due to fraud or error; design and implement appropriate policy responses to those risks; and obtain sufficient and appropriate evidence to form the basis of an opinion. Since fraud may involve collusion, forgery, omission on purpose, fraudulent statements or violation of internal control, we did not find that the risk of misstatements due to fraud was higher than the same due to errors.

• II. We obtained an understanding of the internal control relevant to our 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 Luxe Green Energy Technology Co., Ltd. and its subsidiaries.

• III. Evaluate the appropriateness of the accounting policies used by management and the reasonableness of the accounting estimates and related disclosures made by management.

• IV. Based on the evidence obtained, we have reached a conclusion as to the appropriateness of management's adoption of the going concern basis of accounting and whether there is any material uncertainty about events or circumstances that may cast significant doubt about the ability of Luxe Green Energy Technology Co., Ltd. and its subsidiaries to continue as a going concern. If any material uncertainty was deemed to exist in such event or circumstance, we must provide a reminder in the consolidated financial statements for the users to pay attention to the relevant disclosure therein, or amend our audit opinions when such disclosure was inappropriate. Our conclusion was drawn based on the audit evidence acquired as of the date of this audit report. However, future events or circumstances might result in a situation where Luxe Green Energy Technology Co., Ltd. and its subsidiaries would no longer have its ability to function as a going concern.

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• V. We evaluated the overall presentation, structure, and contents of the consolidated financial statements (including relevant notes), and whether the consolidated financial statements presented relevant transactions and events fairly.

• VI. We acquired sufficient and appropriate audit evidence with respect to the entities comprising Luxe Green Energy Technology Co., Ltd. and its subsidiaries to provide opinions regarding the consolidated financial statements. We were responsible for instruction, supervision and implementation of the audit cases, as well as formation of the audit opinions on Luxe Green Energy Technology Co., Ltd. and its subsidiaries.

The matters for which we communicated with the governance unit include the planned audit scope and time, and major audit findings (including the significant deficiencies of internal control identified during the audit.)

We also provided a declaration of independence to the governance unit, which assured that we complied with the requirements related to independence in the Norms of Professional Ethics for Certified Public Accountants, and communicated all relationships and other matters (including relevant protective measures), which we considered to be likely to cause an impact on the independence of CPAs, to the governance unit.

We determined the key audit matters to be audited in the FY2022 consolidated financial statements of Luxe Green Energy Technology Co., Ltd. and its subsidiaries based on the matters communicated with the governance unit. Unless public disclosure of certain matters was prohibited by related laws or regulations or if, in very exceptional circumstances, we determined not to cover such matters in the audit report, as we could reasonably expect that the negative impact of the coverage was greater than the public interest brought thereby, we specified such matters in the audit report.

Baker Tilly Clock & Co

CPA:

Yin-Lai Chou

CPA:

Chia-Yu Lai

Approval No.: (1991) Tai-Tsai-Cheng (6) No. 53585 Jin-Guan-Zheng-Shen-Zi No. 1050043092

February 21, 2023

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Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Consolidated Balance Sheet

December 31, 2022 and 2021

					Unit: NT$‘000	Unit: NT$‘000
	Assets	Notes	December 31, 2022		December 31, 2021
Code	AccountingItem		Amount	%	Amount	%
11xx 1100 1110 1136 1140 1150 1170 1180 1200 1210 1220 1310 1410 1470 11xx 15xx 1517 1535 1550 1600 1755 1780 1840 1915 1920 1930 1990 15xx 1xxx	Current assets Cash Financial assets measured at fair value through profit or loss - current Financial assets measured at amortized cost - current Contract assets - current Notes receivable Accounts receivable Accounts receivable - related parties Other receivables Other receivables - related parties Income tax assets in current period Inventories Prepayment Other current assets Total current assets Non-current assets Financial assets at fair value through other comprehensive income or loss - non-current Financial assets measured at amortized cost - non-current Investments recognized under the equity method Property, plant and equipment Right-of-use assets Intangible assets Deferred income tax assets Prepayment for equipment purchase Refundable deposit Long-term notes and accounts receivable Other non-current assets Total non-current assets Total assets	6(1) 6(2) 6(28) 6(4) 6(20), 7 6(5) 6(5) 6(5), 7 7 6(25) 6(6) 6(11) 6(12) 6(3), 6(28) 6(4) 6(7) 6(8) 6(9) 6(10) 6(25) 6(11) 6(13)	$ 450,322 68,723 106,298 68,278 1,310 61,527 5,060 2,099 17,917 46 155,415 35,165 44,242	15 2 4 2 － 2 － － 1 － 5 1 2	$ 639,204 19,490 46,025 22,032 7,256 18,326 172,434 493 12,699 1,306 24,041 2,679 21,266	25 1 2 1 － 1 7 － － － 1 － 1
			1,016,402	34	987,251	39
			25,278 103,816 1,415 701,749 126,517 27,268 1,142 757,706 29,844 207,991 －	1 3 － 24 4 1 － 25 1 7 －	－ 121,424 － 604,868 125,741 27,796 1,234 419,614 48,918 207,991 2,209	－ 5 － 24 5 1 － 16 2 8 －
			1,982,726	66	1,559,795	61
			$ 2,999,128	100	$ 2,547,046	100

(The attached notes are part of the consolidated financial statements)

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Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Consolidated Balance Sheet (continued)

December 31, 2022 and 2021

					Unit: NT$‘000	Unit: NT$‘000
	Liabilities and Equity	Notes	December 31, 2022		December 31, 2021
Code	AccountingItem		Amount	%	Amount	%
21xx 2100 2130 2150 2160 2170 2180 2219 2220 2230 2250 2280 2322 2399 21xx 25xx 2540 2550 2570 2580 2645 25xx 2xxx 31xx 3110 3200 3300 3310 3320 3350 3400 31xx 36xx 3xxx	Current liabilities short-term borrowings Contract liabilities - current Notes payable Notes payable - related parties Accounts payable Accounts payable - related parties Other payables Other payables - related parties Income tax liabilities in current period Liability reserve - current Lease liabilities - current Long-term borrowings maturing within one year Other current liabilities Total current liabilities Non-current liabilities Long-term borrowings Liability reserve - non-current Deferred income tax liabilities Lease liabilities - non-current Deposit received Total non-current liabilities Total liabilities Attributable to the shareholder’s equity of the parent company Common share capital Capital reserve Retained earnings Legal reserve Special reserve Undistributed earnings Other equity Total equity attributable to parent company shareholders Non-controlling equity Total equity Total Liabilities and Equity	6(14) 6(20) 6(16) 6(16), 7 6(16) 6(16), 7 7 6(25) 6(9) 6(15) 6(15) 6(25) 6(9) 6(18)	$ 240,640 6,402 1,923 104 79,158 20,382 21,678 19,431 8,940 618 8,646 47,081 470	8 － － － 3 1 1 1 － － － 2 －	$ 149,709 396 331 － 15,519 103,852 19,732 95,274 3,070 133 7,045 43,795 445	6 － － － － 4 1 4 － － － 2 －
			455,473	16	439,301	17
			699,303 2,151 62 120,960 946	23 － － 4 －	336,025 4,175 134 120,613 117	13 － － 5 －
			823,422	27	461,064	18
			1,278,895	43	900,365	35
			1,454,858 133,054 25,948 13 46,341 (194)	48 4 1 － 2 －	1,359,680 133,054 14,726 － 134,867 (13)	54 5 1 － 5 －
			1,660,020	55	1,642,314	65
			60,213	2	4,367	－
			1,720,233	57	1,646,681	65
			$ 2,999,128	100	$ 2,547,046	100

(The attached notes are part of the consolidated financial statements)

Chairman: Chen Chien-Jen President: Chen Lien-Tsung Chief Accounting Officer: Chien Shih-Chang

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Luxe Green Energy Technology Co., Ltd. and its subsidiaries (Originally: Luxe Electric Co., Ltd)

Consolidated Statement of Comprehensive Income

January 1 to December 31, 2022 and 2021

					Unit: NT$‘000	Unit: NT$‘000
Code	Item	Notes	FY2022		FY2021
			Amount	%	Amount	%
4100 5000 5900 6000 6100 6200 6300 6450 6000 6900 7000 7100 7010 7020 7050 7055 7060 7000 7900 7950 8200 8300 8310 8316 8360 8361 8399 8500 8600 8610 8620 8700 8710 8720 9750 9850	Net operating revenue Operating costs Operating gross profit Operating expenses Marketing expense Administrative expense R&D expense Profit from reversal of expected credit impairment Total operating expense Net operating profit Non-operating revenue and expenses Interest income Other revenue Other profits and losses Financial cost Loss from expected credit impairment Share of profit/loss of subsidiaries recognized under the equity method Total non-operating revenue and expense Net profit before tax Income tax expense in current period Other comprehensive income Items not reclassified to profit or loss Unrealized valuation loss on investments in equity instruments measured at fair value through other comprehensive income Items able to be reclassified as profit or loss in the future Exchange difference from conversion of financial statements of foreign operations Income tax related to items potentially being reclassified Total current comprehensive income or loss Net profit attributable to: Parent company shareholders Non-controlling equity Total Total comprehensive income attributable to: Parent company shareholders Non-controlling equity Total Earnings per share (NTD) Basic Diluted	6(20) 6(21) 6(25) 6(19)	$ 281,520 (161,798)	100 (57)	$ 324,446 (175,257)	100 (54)
			119,722	43	149,189	46
			(10,151) (31,827) (2,752) －	(4) (11) (1) －	(7,130) (31,481) (3,890) 191	(2) (10) (1) －
			(44,730)	(16)	(42,310)	(13)
			74,992	27	106,879	33
			1,237 2,220 (10,855) (11,077) (259) 1	－ － (4) (4) － －	524 12,449 7,068 (10,208) － －	－ 4 2 (3) － －
			(18,733)	(8)	9,833	3
			56,259 (9,825)	19 (3)	116,712 (3,929)	36 (1)
			46,434	16	112,783	35
			(370) 26 －	－ － －	－ (26) －	－ － －
			$ 46,090	16	$ 112,757	35
			$ 45,080 1,354	16 －	$ 112,220 563	35 －
			$ 46,434	16	$ 112,783	35
			$ 44,899 1,191	16 －	$ 112,207 550	35 －
			$ 46,090	16	$ 112,757	35
			$ 0.31 $ 0.31		$ 0.94 $ 0.94

(The attached notes are part of the consolidated financial statements) Chairman: Chen Chien-Jen President: Chen Lien-Tsung Chief Accounting Officer: Chien Shih-Chang

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Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Consolidated Statement of Changes in Equity

January 1 to December 31, 2022 and 2021

Unit: NT$ ‘000

											Unit: NT$‘00
Code	Item	Common share capital		Attribut	abletothe sharehold	er’s equity of the parentcompany			Total	Non-controlling equity	Total equity
			Capital reserve		Retained earnings		Otherequityitems
				Legal reserve	Special reserve	Undistributed earnings	Exchange difference from conversion of financial statements of foreign operations	Unrealized valuation loss on financial assets measured at fair value through other comprehensive income
Z1 B1 B5 D1 D3 D5 E1 O1 Z1 B1 B3 B5 B9 D1 D3 D5 M3 M5 Z1	Balance as of January 1, 2021 Provision for legal reserve Cash dividend for shareholders in current period Other comprehensive income in current period Total current comprehensive income or loss Follow-on offering Non-controlling equity Balance on December 31, 2021 Provision for legal reserve Provision for special reserve Cash dividend for shareholders Common stock dividends in current period Other comprehensive income in current period Total current comprehensive income or loss Disposal of subsidiaries Acquisition of subsidiaries Balance as of December 31, 2022	$ 959,680 － － － －	$ 29,054 － － － －	$ 8,518 6,208 － － －	$ － － － － －	$ 76,839 (6,208) (47,984) 112,220 －	$ － － － － (13)	$ － － － － －	$ 1,074,091 － (47,984) 112,220 (13)	$ － － － 563 (13)	$ 1,074,091 － (47,984) 112,783 (26)
		－	－	－	－	112,220	(13)	－	112,207	550	112,757
		400,000 －	104,000 －	－ －	－ －	－ －	－ －	－ －	504,000 －	－ 3,817	504,000 3,817
		1,359,680	133,054	14,726	－	134,867	(13)	－	1,642,314	4,367	1,646,681
		－ － － 95,178 － －	－ － － － － －	11,222 － － － － －	－ 13 － － － －	(11,222) (13) (27,193) (95,178) 45,080 －	－ － － － － 13	－ － － － － (194)	－ － (27,193) － 45,080 (181)	－ － － － 1,354 (163)	－ － (27,193) － 46,434 (344)
		－	－	－	－	45,080	13	(194)	44,899	1,191	46,090
		－ －	－ －	－ －	－ －	－ －	－ －	－ －	－ －	(1,201) 55,856	(1,201) 55,856
		$ 1,454,858	$ 133,054	$ 25,948	$ 13	$ 46,341	$ －	$ (194)	$ 1,660,020	$ 60,213	$ 1,720,233

(The attached notes are part of the consolidated financial statements)

Chairman: Chen Chien-Jen President: Chen Lien-Tsung Chief Accounting Officer: Chien Shih-Chang

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Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Consolidated Statement of Cash Flow

January 1 to December 31, 2022 and 2021

			Unit: NT$‘000
Code	Item	FY2022	FY2021
AAAA A10000 A20010 A20100 A20200 A20300 A20400 A20900 A21200 A21300 A22300 A22500 A23500 A23100 A29900 A30000 A31125 A31130 A31150 A31160 A31180 A31190 A31200 A31230 A31240 A32125 A32130 A32140 A32150 A32160 A32180 A32190 A32200 A32230 A33000 A33100 A33200 A33300 A33500 AAAA	Cash flow from operating activities Pre-tax net profit in current period Income and expense items: Depreciation expense Amortization expense Loss (profit) from expected credit impairment Net loss (gain) on financial assets at fair value through profit or loss Financial cost Interest income Dividend income Share of interests of subsidiaries recognized under the equity method Loss from disposal of property, plant, and equipment Financial assets impairment loss Disposal of investment interests Profit from lease changes Net change in operating assets and liabilities Contract assets Notes receivable Accounts receivable Accounts receivable - related parties Other receivables Other receivables - related parties Inventory Prepayment Other current assets Contract liabilities Notes payable Notes payable - related parties Accounts payable Accounts payable - related parties Other payables Other payables - related parties Liability reserve Other current liabilities Cash inflow (outflow) from operations Interest received Dividend received Interest paid Income tax paid Net cash inflow (outflow) from operating activities	$ 56,259 51,831 2,295 259 8,040 11,077 (1,237) (622) (1) 307 － (250) (12) (39,233) 5,946 (37,712) 167,374 (1,922) (5,218) (131,374) (25,246) (27,369) 6,006 (471) 104 60,500 (83,470) 563 (75,843) (1,539) (293)	$ 116,712 46,201 2,294 (191) (7,832) 10,208 (524) (587) － 346 189 － (90) 88,542 58,949 94,480 (172,434) 596 (12,440) (6,058) 1,856 (19,900) 19 331 － (56,174) 103,818 6,887 － (722) 29
		(61,251) 1,294 622 (10,485) (3,195)	254,505 493 587 (15,145) (1,367)
		(73,015)	239,073

(Continued on next page)

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Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Consolidated Statement of Cash Flow (continued)

January 1 to December 31, 2022 and 2021

			Unit: NT$‘000
Code	Item	FY2022	FY2021
BBBB B00010 B00100 B00200 B00040 B00050 B02200 B02300 B02700 B02800 B03700 B03800 B04500 B06700 B07100 BBBB CCCC C00100 C01600 C01700 C03000 C03100 C04020 C04500 C04600 C05800 CCCC DDDD EEEE E00100 E00200	Cash flow from investing activities Acquisition of financial assets measured at fair value through other comprehensive income Acquisition of financial assets at fair value through profit or loss Disposal of financial assets measured at fair value through profit or loss Acquisition of financial assets measured at amortized cost Disposal of financial assets measured at amortized cost Acquisition of subsidiaries Disposal of subsidiaries Acquisition of property, plant, and equipment Disposal of property, plant, and equipment Increase in refundable deposit Decrease in refundable deposit Acquisition of intangible assets Increase of other non-current assets Increase in prepayment for equipment Net cash outflow from investing activities Cash flow from financing activities Increase in short-term borrowings Borrowing of long-term borrowings Repayment of long-term borrowings Increase in deposit received Decrease in deposits received Repayment of principal for lease liabilities Allocation of cash dividends Follow-on offering Changes in non-controlling equity Net cash inflows from financing activities Effect of changes in exchange rate on cash (Decrease) increase in cash and cash equivalents for the period Cash balance at beginning of period Cashbalance at ending ofperiod	$ (13,300) (57,273) － (36,367) － 15,603 (1,146) (33,327) 45 － 27,943 (1,767) 2,209 (443,118)	$ － － 21,340 (78,775) 95,601 1,427 － (12,754) 355 (58,589) 20,174 － － (317,181)
		(540,498)	(328,402)
		90,931 583,783 (217,219) 829 － (8,180) (27,193) － 1,459	30,000 122,858 (35,583) － (400) (6,893) (47,984) 504,000 2,450
		424,410	568,448
		221	(26)
		(188,882) 639,204	479,093 160,111
		$ 450,322	$ 639,204

(The attached notes are part of the consolidated financial statements)

Chairman: Chen Chien-Jen President: Chen Lien-Tsung Chief Accounting Officer: Chien Shih-Chang

13

Luxe Green Energy Technology Co., Ltd. and its subsidiaries (Originally: Luxe Electric Co., Ltd)

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

(Amounts in NT$’000 unless otherwise specified)

I. Corporate history

Luxe Green Energy Technology Co., Ltd.(Originally: Luxe Electric Co., Ltd), hereinafter referred to as the "Company", was established on April 22, 1978, and is engaged in the design, manufacture, installation and sale of high and low voltage distribution panels, various electrical and electronic equipment (including transformers), and various electrical and photovoltaic plant engineering contracts.

The Company’s stock was listed for trading on the Taiwan Stock Exchange on September 11, 2000.

The consolidated financial statements are presented with the functional currency (NTD) of the Company.

II. Date and Procedure for Approval of Financial Statements

This consolidated financial report was issued on February 21, 2023, after being presented to the Board of Directors.

III. Application of Newly Issued and Revised Standards and Interpretations

• (I) First-time application of International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), Interpretations (IFRIC) and Interpretations (SIC) (hereinafter referred to as "IFRSs")

Endorsed by the Financial Supervisory Commission (hereinafter referred to as "FSC") and issued into effect. The application of the amended IFRSs approved and issued by the FSC has no significant impact on the accounting policies of the Company and the entities controlled by the Company (the "Consolidated Company").

• (II) IFRSs recognized by the FSC in 2023

FRSs recognized by the FSC in 2023
Newly Announced/Amendments/Revised Standards and Interpretations	Effective Date of IASB Pronouncements
Amendments to IAS 1, "Disclosure of Accounting Policies" Amendments to IAS 8, "Definition of Accounting Estimates" Amendments to IAS 12, "Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction".	January 1, 2023 (Note 1) January 1, 2023 (Note 2) January 1, 2023 (Note 3)

• Note 1: The application of this amendment is applicable to deferments for annual reporting periods beginning after January 1, 2023.

• Note 2: This amendment applies to changes in accounting estimates and changes in accounting policies that occur in annual reporting periods beginning after January 1, 2023.

• Note 3: The amendment applies to transactions occurring after January 1, 2022, except for the recognition of deferred income taxes on temporary differences for lease and ex-service obligations as of January 1, 2022.

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As of the date of adoption of this consolidated financial report, the Consolidated Company is continuing to evaluate the impact of the above amendments on its financial position and financial performance of the Consolidated Company. The related impacts will be disclosed upon completion of the evaluation.

• (III) IFRSs issued by the IASB but not yet endorsed by the FSC and therefore not yet effective

Newly Announced/Amendments/Revised Standards Effective Date of IASB and Interpretations Pronouncements (Note 1) Amendments to IFRS 10 and IAS 28 "Sale or Not yet determined Contribution of Assets between an Investor and its Associate or Joint Venture" Amendments to IFRS 16 "Lease Liabilities in Sale January 1, 2024 (Note 2) and Leaseback Transactions". IFRS 17 "Insurance Contracts" January 1, 2023 Amendments to IFRS 17 January 1, 2023 Amendments to IFRS 17 "Initial Application of IFRS January 1, 2023 17 and IFRS 9 - Comparative Information" Amendments to IAS 1, "Classification of Liabilities as January 1, 2024 Current or Non-current". Amendments to IAS 1, “Non-current Liabilities with January 1, 2024 Contractual Terms".

Note 1: Unless otherwise specified, the above new/amended/revised standards or interpretations are effective for annual periods beginning after the respective dates.

• Note 2: The seller and lessee shall apply the amendments to IFRS 16 retroactively to sale-and-leaseback transactions entered into after the date of initial application of IFRS 16.

As of the date of adoption of this consolidated financial report, the Consolidated Company is continuing to evaluate the impact of the above amendments on its financial position and financial performance of the Consolidated Company. The related impacts will be disclosed upon completion of the evaluation.

IV. Summary of Significant Accounting Policies

• (I) Statement of Compliance

The consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs approved and issued by the FSC.

• (II) Basis of Preparation

The consolidated financial statements have been prepared on the historical cost basis, except for financial instruments carried at fair value.

Fair value measurements are classified into Level 1 to Level 3 based on the degree of observability and significance of the relevant inputs:

1. Level 1 inputs: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

2. Level 2 inputs: Inputs other than those quoted in 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: Unobservable inputs for assets or liabilities.

4. (III) Criteria for distinguishing current and non-current assets and liabilities

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Current assets include:

1. Assets held primarily for trading purposes;

2. Assets expected to be realized within 12 months after the balance sheet date; and

3. Cash (excluding those restricted for exchange or settlement of liabilities more than 12 months after the balance sheet date).

Current liabilities include:

1. Liabilities held primarily for trading purposes;

2. Liabilities due for settlement within 12 months of the balance sheet date, and

3. liabilities for which the maturity date cannot be unconditionally extended to at least 12 months after the balance sheet date.

Liabilities that are not current assets or current liabilities are classified as noncurrent assets or noncurrent liabilities.

The Consolidated Company engages in construction projects with a business cycle longer than one year. Therefore, assets and liabilities related to construction projects are classified as current or noncurrent based on the normal business cycle.

• (IV) Basis of Consolidation

• Principles Governing the Preparation of Consolidated Financial Statements

The entity that prepares the consolidated financial statements consists of the Company and entities controlled by the Company (i.e., subsidiaries). The Company controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.

The financial statements of the subsidiaries are included in the consolidated financial statements from the date control over them is acquired until the date control is lost. Intercompany transactions, balances and any unrealized gains and losses are eliminated upon the preparation of the consolidated financial statements. The total consolidated profit or loss of subsidiaries is attributed to the Company's owners and noncontrolling interests, respectively, even if the noncontrolling interests become a loss balance as a result.

The financial statements of subsidiaries have been appropriately adjusted to conform to the accounting policies used by the Consolidated Company.

Changes in the Consolidated Company's ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

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1. Subsidiaries Included in Consolidated Financial Statements

The subsidiaries included in this consolidated financial report consist of:

Name of the investment company	Investee company name	Nature of business	Percentage of shareholding (%)	Percentage of shareholding (%)
			December 31, 2022	December 31, 2021 Description
The Company The Company The Company The Company The Company The Company The Company Chin Lai International Development Co., Ltd.	Le Hua Investment Co., Ltd. Luxe Solar Energy Co., Ltd. Sen-Hsin Energy Co., Ltd. Chin Lai International Development Co., Ltd. Wan Chuan Construction Co., Ltd. Kai Shih Energy Co., Ltd. Joy Ribbon Limited Qun Li Energy Co., Ltd.	Investment Energy Technical Services Energy Technical Services Energy Technical Services Comprehensive Construction Activities Energy Technical Services International Trade in Energy Products Energy Technical Services	100 100 100 100 52.5 51 － 100	100 100 100 100 － Note 4 51 Notes 1 and 3 51 Notes 2 and 3 100

Note 1: Kai Shih Energy Co., Ltd. was established in September, 2021. Note 2: The Company subscribed to the follow-on offering of Joy Ribbon Limited for its cash capital increase in October 2021. Note 3: On April 22, 2022, the Board of Directors resolved to dispose of all the shares of Joy Ribbon Limited and Kai Shih Energy Co., Ltd. for the original invested amount in order to focus on the core business of the Company. Among them, the Company’s shareholdings of Joy Ribbon Limited was disposed of in May 2022.

Note 4: On November 28, 2022, the Company subscribed to the follow-on offering of Wan Chuan Construction Co., Ltd.

3. Subsidiaries Not Included in Consolidated Financial Statements: None.

(V) Foreign Currency

The individual financial statements of each entity of the Consolidated Company are presented in the currency of the primary economic environment in which the entity operates (functional currency). In preparing the consolidated financial statements, the results of operations and financial position of each consolidated entity are translated into New Taiwan dollars (the Company's functional currency and the presentation currency of the consolidated financial statements).

In preparing the financial statements of each consolidated entity, transactions in currencies other than the functional currency of that entity (foreign currencies) are recognized at the exchange rates prevailing on the dates of transactions. At the end of the reporting period, items denominated in foreign currencies are retranslated at the exchange rates prevailing on that date, and the resulting exchange differences are recognized in profit or loss in the year in which they occur. Non-monetary items denominated in foreign currencies that are measured at fair value are translated at the exchange rates prevailing on the date when the fair value was determined, and the resulting exchange differences are recognized in profit or loss in the current year, apart from those arising from changes in fair value that are recognized in other comprehensive income. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

During preparation of the consolidated financial statements, the assets and liabilities of the Company's foreign operations are translated into NTD at the exchange rate On the end date of the reporting period. Income and expense items are translated at average exchange rates for the period, with the resulting exchange differences recorded in other comprehensive income and accumulated in the financial statements of foreign operating companies under equity and appropriately allocated to noncontrolling interests.

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(VI) Inventory

Inventories consist of raw materials, finished goods and work-in-process. Inventories are measured at the lower of cost or net realizable value. Comparisons between cost and net realizable value are made on an item-by-item basis, except for inventories of the same type. Net realizable value is the estimated selling price under normal circumstances less estimated costs to complete and estimated costs to complete the sale. The cost of inventories is calculated using the weighted-average cost (WAC) method.

(VII) Investment in Affiliated Companies

The Consolidated Company applies the equity method to its investment in affiliated companies. Under the equity method, investments in affiliated companies are initially recognized at cost, and the carrying amount of the investment after acquisition increases or decreases in accordance with the Consolidated Company's share of profits or losses of the affiliated companies and other comprehensive income or loss and profit distribution. In addition, changes in equity in affiliated companies are recognized on a proportional basis to shareholdings. If the Consolidated Company does not subscribe for new shares issued by an affiliated company in proportion to its shareholding, resulting in a change in its shareholding and a resulting increase or decrease in the net equity of the investment, the increase or decrease is adjusted to capital reserve- changes in the net equity of the related company recognized under the equity method and the investment accounted for under the equity method. If the balance of capital reserve from investments accounted for using the equity method is not sufficient, the difference is debited to retained earnings.

(VIII) Property, Plant, and Equipment

The property, plant, and equipment are recognized on the basis of the cost and subsequently measured based on the cost net of accumulated depreciations and accumulated impairment losses.

Except for land owned by the Consolidated Company, which is not depreciated, property, plant and equipment are depreciated separately over their useful lives on a straight-line basis for each significant component. The Consolidated Company reviews the estimated useful lives, residual values and depreciation methods at least at the end of each year and defers the effect of changes in applicable accounting estimates.

When property, plant and equipment are derecognized, the difference between the net disposal price and the carrying amount of the assets is recognized in profit or loss.

(IX) Intangible Assets

1. Individually acquired

Individually acquired intangible assets with finite useful lives are initially measured at cost and subsequently measured at cost less accumulated amortization and accumulated impairment losses. Intangible assets are amortized on a straightline basis over their useful lives. The Consolidated Company reviews the estimated useful lives, residual values and amortization methods at least at each year-end and defers the effect of changes in applicable accounting estimates.

2. Acquired through business combination

Intangible assets acquired in a business combination are recognized at fair value at the date of acquisition and separately from goodwill, and are subsequently measured in the same manner as intangible assets acquired separately.

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3. Derecognition

When an intangible asset is derecognized, the difference between the net disposal price and the carrying amount of the asset is recognized in profit or loss for the current period.

• (X) Impairment of Property, Plant and Equipment, Right-of-Use Assets and Intangible assets

The Consolidated Company assesses at each balance sheet date whether there is any indication that property, plant and equipment, and right-of-use assets may be impaired. If there is any of such signs, the recoverable amount of the assets is estimated. If the recoverable amount of an individual asset cannot be estimated, the Consolidated Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The 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 less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount, and the impairment loss is recognized in profit or loss.

When the impairment loss is subsequently reversed, the carrying amount of the asset or cash-generating unit is increased to the revised recoverable amount, provided that the increased carrying amount does not exceed the carrying amount (net of depreciation) that would have been determined had the impairment loss not been recognized in prior years. Reversals of impairment losses recognized in profit or loss.

(XI) Financial Instruments

Financial assets and financial liabilities are recognized in the consolidated balance sheet when the Consolidated Company becomes a party to the contractual provisions of the instrument.

For initial recognition of the financial assets and financial liabilities, when the financial assets or financial liabilities are not measured at fair value through profit and loss, they are measured at the fair value plus any transaction cost directly attributable to the acquisition or issuance of the financial assets or financial liabilities. Transaction costs directly attributable to the acquisition or issuance of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

1. Financial Assets

Regular transactions of financial assets are recognized and derecognized using trade date accounting.

• (1) Types of measurements

The types of financial assets held by the Consolidated Company are financial assets measured at fair value through profit or loss and financial assets measured at amortized cost.

• A.Financial assets at fair value through profit or loss

Financial assets measured at fair value through profit or loss are measured at fair value with dividends, interest and gains or losses from remeasurements recognized in other gains and losses. Please refer to Note 6(28) for the determination of fair value.

• B. Financial assets measured at amortized cost

The Consolidated Company's investment in financial assets is classified as financial assets carried at amortized cost if both of the following conditions

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are met:

• a. The financial assets are held under an operating model whose objective is to hold financial assets for contractual cash flows; and

• b. The contractual terms result in cash flows at a specific date, which are solely payments of principal and interest on the principal amount outstanding.

Financial assets carried at amortized cost (including cash, accounts receivable at amortized cost, notes receivable, other receivables, long-term notes and accounts receivable, and refundable deposits) are measured at amortized cost using the effective interest method to determine the total carrying amount less any impairment loss after initial recognition, with any foreign currency exchange gain or loss recognized in profit or loss.

• C. Investments in equity instruments measured at fair value through other comprehensive income or loss

At initial recognition, the Consolidated Company has an irrevocable option to designate investments in equity instruments that are not held-for-trading and for which contingent consideration is recognized by the non-acquirer of the business combination to be measured at fair value through other comprehensive income.

Investments in equity instruments measured at fair value through other comprehensive income are measured at fair value, with subsequent changes in fair value reported in other comprehensive income and accumulated in other equity. Upon disposal of investments, the accumulated gains and losses are transferred directly to retained earnings and are not reclassified to profit or loss.

Dividends from investments in equity instruments measured at fair value through other comprehensive income or loss are recognized in profit or loss when the rights to receive payments from the Consolidated Company are established, unless the dividends clearly represent a partial recovery of the cost of the investment.

• (2) Impairment of financial assets and contract assets

The Consolidated Company assesses impairment losses on financial assets (including accounts receivable) and contract assets measured at amortized cost at each balance sheet date based on expected credit losses.

An allowance for impairment is recognized for accounts receivable and contract assets based on the expected credit loss over the life of the asset. Other financial assets are evaluated to determine whether there is a significant increase in credit risk since initial recognition. If there is no significant increase in credit risk, an allowance for loss is recognized based on the expected credit loss over 12 months, and if there is a significant increase in credit risk, an allowance for loss is recognized based on the expected credit loss over the expected lifetime of the asset.

Expected credit losses are the weighted-average credit losses weighted by the risk of default. The 12-month expected credit loss represents the expected credit loss arising from possible defaults within 12 months after the reporting date, while the expected credit loss over the life of the financial instrument represents the expected credit loss arising from all possible defaults during the expected life of the instrument.

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For internal credit risk management purposes, the Consolidated Company determines, without considering the collaterals held, that a default on a financial asset has occurred under the following circumstances:

• A. Any internal or external information indicating that it is impossible for a debtor to pay off the debts.

• B. Debts are overdue for more than 180 days unless there is reasonable and supportable information indicating that a delayed default basis is more appropriate.

The carrying amount of all financial assets is reduced by an allowance account.

• (3) Derecognition of financial assets

The Consolidated Company derecognizes financial assets only when the contractual rights to the cash flows from the financial assets lapse or when the financial assets have been transferred and substantially all the risks and rewards of ownership of the assets have been transferred to other enterprises.

The difference between the carrying amount of the financial asset and the consideration received is recognized in profit or loss when the financial asset is derecognized as a whole at amortized cost.

1. Equity instruments

Equity instruments issued by the Consolidated Company are recognized at the acquisition price less direct issuance costs.

1. Financial liabilities

2. (1) Subsequent measurement of financial liabilities

All financial liabilities are measured at amortized cost using the effective interest method.

• (2) Derecognition of financial liabilities

When a financial liability is derecognized, the difference between the carrying amount and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.

• (XII) Provision for Liabilities

The amount recognized as a provision is the best estimate of the amount required to settle the obligation at the balance sheet date, taking into account the risks and uncertainties of the obligation.

Warranties

Warranty obligations under construction contracts are recognized in income based on management's best estimate of the expenses required to settle the Consolidated Company's obligations.

• (XIII) Revenue Recognition

After the Consolidated Company identifies performance obligations under customer contracts, the transaction price is apportioned to each performance obligation and revenue is recognized when each performance obligation is satisfied.

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1. Merchandise sales revenue

Revenue from merchandise sales is derived from the sale of electrical equipment. When the electrical equipment is inspected and delivered to the designated location, the customer has the right to set the price and use the product and has the primary responsibility for reselling it, and assumes the risk of obsolescence of the merchandise. The Consolidated Company recognizes revenue and accounts receivable at that point in time.

2. Construction revenue

The Consolidated Company recognizes revenue using the percentage-ofcompletion method for construction contracts in which the immovable property is under the control of the customer during the construction process. The Consolidated Company measures the percentage of completion based on actual construction progress. The Consolidated Company recognizes contract assets over time during the construction process and reclassifies them as accounts receivable upon billing. If the amount received exceeds the amount of revenue recognized, the difference is recognized as a contract liability.

1. Electricity sales revenue

Revenues from electricity sales are based on the actual kilowatt hours generated and the rates agreed with Taiwan Power Company.

4. Service revenue

The service revenue comes from the subcontracting services of power plant works. Since the performance obligation and risk related to the power plant works have been transferred to the subcontractors, the Group provides subcontracting services as an agent and recognizes the revenue based on the actual progress of the works carried out by the subcontractors.

(XIV) Leases

The Consolidated Company assesses whether a contract is (or contains) a lease at the inception date of the contract.

For contracts with lease and non-lease components, the Consolidated Company apportions the consideration in the contracts on the basis of separate prices and treats them separately.

1. Where the Consolidated Company is the lessor

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

Under operating leases, lease payments, net of lease incentives, are recognized as income on a straight-line basis over the term of the relevant lease. The original direct cost incurred to acquire an operating lease is added to the carrying amount of the underlying asset and recognized as an expense over the lease term on a straight-line basis.

1. Where the Consolidated Company is the lessee

Right-of-use assets and lease liabilities are recognized at the lease commencement date for all leases except for leases of low-value subject assets to which recognition exemptions apply and short-term leases where lease payments are recognized as an expense on a straight-line basis over the lease term.

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Right-of-use assets are measured initially at cost (including the original measurement of the lease liability, lease payments made prior to the lease commencement date less lease incentives received, original direct cost and estimated cost of restoration of the subject asset) and subsequently measured at cost less accumulated depreciation and accumulated impairment losses, with adjustments for remeasurement of the lease liability. Right-of-use assets are presented separately in the consolidated balance sheet.

Right-of-use assets are depreciated on a straight-line basis from the lease commencement date to the earlier of the end of the useful life or the end of the lease term.

Lease liabilities are measured initially at the present value of the lease payments. If the interest rate implied by the lease is readily determinable, lease payments are discounted using that rate. If the interest rate is not readily determinable, the lessee's incremental borrowing rate is used.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, and interest expense is allocated over the lease term. Lease liabilities are presented separately in the consolidated balance sheet.

Rentals under leases that do not depend on changes in indices or rates are recognized as expenses in the period in which they are incurred.

(XV) Borrowing Costs

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

Investment income earned on specific borrowings that are temporarily invested prior to the incurrence of qualifying capital expenditures is deducted from the cost of borrowings eligible for capitalization.

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

• (XVI) Employee Benefits

1. Short-term employee benefits

Short-term employee benefit-related liabilities are measured at the non-discounted amount expected to be paid in exchange for employee services.

1. Postemployment benefits

Defined contribution pension plan benefits are recognized as an expense over the period of service rendered by employees.

(XVII) Income tax

Income tax expense is the sum of current income tax and deferred income tax.

1. Current income tax

The Consolidated Company determines the current income (loss) based on the regulations of each jurisdiction in which the Consolidated Company files income tax returns and calculates the amount of income tax payable (recoverable).

Income tax on undistributed earnings is recognized in the year when the shareholders' meeting is held.

Adjustments to prior years' income tax payable are included in the current period's income tax.

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1. Deferred income tax

Deferred income tax is calculated on temporary differences between the carrying amounts of assets and liabilities and the tax bases used to compute taxable income.

Deferred income tax liabilities are generally recognized for all taxable temporary differences, while deferred income tax assets are recognized to the extent that it is probable that taxable profit will be available against which the temporary differences or loss carryforwards can be utilized.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient tax assets will be available to allow recovery of all or part of the asset. Deferred income tax assets are reviewed at each balance sheet date and the carrying amount is increased to the extent that it is more likely than not that sufficient tax assets will be available to allow recovery of all or part of the assets.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the liability is settled or the asset is realized, based on tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. The measurement of deferred tax liabilities and assets reflects the tax consequences of the manner in which the Consolidated Company expects to recover or settle the carrying amounts of its assets and liabilities at the balance sheet date.

3. Current and deferred income taxes

Current and deferred income taxes are recognized in profit or loss.

• V. Significant Accounting Judgments, Estimates and Key Sources of Assumption Uncertainty

In applying accounting policies, the Consolidated Company's management is required to make judgments, estimates and assumptions that are based on historical experience and other relevant factors when the information is not readily available from other sources. Actual results may differ from those estimates.

Management reviews estimates and underlying assumptions on an ongoing basis. Revisions to estimates are recognized in the period in which they are made if they affect only the current period, or in the period in which they are made if they affect both the current and future periods.

Key sources of estimation and assumption uncertainty:

• Long term project payment receivables involving any unsettled litigation

As of December 31, 2022 and 2021, the Consolidated Company had uncollected long-term construction receivables of NT$207,991 thousand (net of allowance for losses of NT$178,575 thousand and estimated overdue penalties) in prior years. Due to the pending litigation with Taiwan Power Company, the recovery of the contract amount is subject to future court decisions. If the outcome of a future court judgment differs materially from the estimated amount of the impairment loss, the amount of the difference is recognized in profit or loss in the year of the judgment.

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VI. Description of Significant Accounting Items

• (I) Cash and cash equivalents

Cash and cash equivalents
December 31,2022 Cash on hand $ 179 Bank deposits 445,143 Time deposits 5,000 Total $ 450,322 Financial assets at fair value through profit or loss December 31,2022 Financial assets - current Non-derivative financial assets Domestic TWSE (TPEx) listed stocks $ 68,723	December 31,2021
	$ 219 638,985 －
	$ 639,204
	December 31,2021
	$ 19,490

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

(III) Financial assets at fair value through other comprehensive income or loss - noncurrent

current
Unlisted stocks	December 31,2022 $ 25,278	December 31,2021
		$ －

The Consolidated Company invests in Castle Applied Inc. for medium- and longterm strategic purposes and expects to make profits from the long-term investment. It is designated as measured at fair value through other comprehensive income. The Consolidated Company's financial assets at fair value through other comprehensive income were not pledged as collateral.

• (IV) Financial assets measured at amortized cost

Current Domestic investments Time deposits with original maturity of more than 3 months Non-current Domestic investments Time deposits with original maturity of more than 3 months Reserveaccount Total	December 31,2022 $ 106,298 $ 80,711 23,105 $ 103,816	December 31,2021
		$ 46,025
		$ 85,530 35,894
		$ 121,424

As of December 31, 2022 and 2021, the interest rate range of the time deposit with an initial maturity date over 3 months was 0.34% to 1.44% and 0.06 ％ to 1.09 ％ , respectively.

For information on pledges of financial assets measured at amortized cost, see Note 8.

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• (V) Notes receivable, accounts receivable and overdue receivables.

December 31,2022 Notes receivable Measured at post-amortized cost $ 1,310 December 31,2022 Accounts receivable-related parties Measured at post-amortized cost Total carrying amount $ 66,626 Less: Allowance for losses (39) Total $ 66,587 Overdue receivables Due to business operations $ 10,552 Less: Allowance for losses (10,552) Total $ －	December 31,2021
	$ 7,256
	December 31,2021
	$ 190,799 (39)
Measured at post-amortized cost Total carrying amount Less: Allowance for losses Total Overdue receivables Due to business operations Less: Allowance for losses Total
	$ 190,760
	$ 10,552 (10,552)
	$ －

1. The average credit period for merchandise sales ranges from 30 to 180 days, and accounts receivable are non-interest-bearing. The Consolidated Company's policy is to deal only with creditworthy customers. The Consolidated Company recognizes an allowance for losses on accounts receivable on the basis of expected credit losses over the life of the receivable. The expected credit losses for the duration of the period are calculated using an allowance matrix, which takes into account the customer's past default history and current financial condition and industry outlook. Because the Consolidated Company's credit loss history shows that there is no significant difference in loss patterns among different customer groups, the allowance matrix does not further differentiate between customer groups and only uses the number of days of aging on the accounts receivable establishment date to determine the expected credit impairment rate.

If there is evidence that the counter-party is in serious financial difficulty and the Consolidated Company cannot reasonably expect to recover the amount, for example, if the counter-party is in liquidation or the debt has been outstanding for more than 720 days, the Consolidated Company reclassifies the amount as an overdue receivable and recognizes an allowance for loss, but continues its collection activities and recognizes the amount recovered in profit or loss.

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1. The Company measures the allowance for losses on notes and accounts receivable based on the allowance matrix as follows:

Loss from expected credit impairment Total carrying amount Allowance for losses (expected credit losses over the life of the Company) Cost after amortization Loss from expected credit impairment Total carrying amount Allowance for losses (expected credit losses over the life of the Company) Cost after amortization	Less than 30 days	31 to 90 days	December 31, 2022 91 to 180 days 181 to 360 days 1.79％ 2％ $ 2,174 $ － (39) － $ 2,135 $ － December 31, 2021 91 to 180 days 181 to 360 days －％ 2％ $ 50,735 $ 1,964 － (39) $ 50,735 $ 1,925	December 31, 2022 91 to 180 days 181 to 360 days 1.79％ 2％ $ 2,174 $ － (39) － $ 2,135 $ － December 31, 2021 91 to 180 days 181 to 360 days －％ 2％ $ 50,735 $ 1,964 － (39) $ 50,735 $ 1,925	361 days or more	Total
	－％ $ 53,349 －	－％ $ 12,413 －	1.79％ $ 2,174 (39)	2％ $ － －	50％ $ － －	$ 67,936 (39)
	$ 53,349	$ 12,413	$ 2,135	$ －	$ －	$ 67,897
	Less than 30 days	31 to 90 days			361 days or more	Total
	－％ $ 144,689 －	－％ $ 667 －	－％ $ 50,735 －	2％ $ 1,964 (39)	50％ $ － －	$ 198,055 (39)
	$ 144,689	$ 667	$ 50,735	$ 1,925	$ －	$ 190,016

Information on the changes in the allowance for losses on accounts receivable is as follows

follows
Balance at the beginning of period Add: Provision for the period (reversal) Less: Write offs for the period Balance at the end of period (VI) Inventory Finished goods Goods in process Raw materials Total	FY2022 $ 39 － － $ 39 December 31,2022 $ 37,197 106,483 11,735 $ 155,415	FY2021
		$ 230 (191) －
		$ 39
		December 31,2021
		$ 9,307 8,880 5,854
		$ 24,041

1. Operating costs related to inventories were NT$96,701 thousand and NT$87,307 thousand FY2022 and FY2021, respectively. The cost of goods sold for FY2022 and FY2021 included NT$1,863 thousand and NT$1,093 thousand, respectively, for the decline in value of inventories and losses on doubtful accounts.

2. As of December 31, 2022 and 2021, none of the Consolidated Company's inventories were pledged as collateral.

3. As of December 31, 2022 and 2021, there was no write-off of allowance for inventory losses due to obsolescence of inventories.

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(VII) Investments Accounted For Using the Equity Method

Individual Insignificant Subsidiaries

Investees	December 31,2022	December 31,2022	December 31,2021	December 31,2021
	Book Value	Shareholdi ngs %	Total carrying amount	Shareholdi ngs %
Park Ave Coworking Space Co., Ltd.	NT$ 1,415	22.5	NT$ -	-

The calculation of the above insignificant affiliates is based on unaudited financial statements; however, in the opinion of the Company's management, such financial statements would not have resulted in a material adjustment had they been audited by the accountants.

Please refer to Schedule 4 (attached) for the business nature, principal place of business, and national information of the affiliated companies.

(VIII) Property, Plant, and Equipment

Item		January1toDecember31,2022	January1toDecember31,2022	January1toDecember31,2022
	Balance at the beginning of period	Acquired	Disposed	Consolidated acquisition	Balance at the end of period
Cost Land Buildings Machinery Equipment Office Equipment Power Generation Equipment Transport Equipment Other Equipment Leasehold Improvements Subtotal Accumulated Depreciation and Impairment Buildings Machinery Equipment Office Equipment Power Generation Equipment Transport Equipment Other Equipment Leasehold improvements Subtotal Net Amount	$ 45,719 99,502 18,348 2,560 660,276 － 40,758 3,348	$ 1,250 270 16,982 559 110,054 － 4,129 5,109	$ － － (3,082) (845) － － (120) －	$ － － － 285 － 200 － 904	$ 46,969 99,772 32,248 2,559 770,330 200 44,767 9,361
	870,511	138,353	(4,047)	1,389	1,006,206
	47,186 16,832 1,608 164,231 － 35,201 585	2,761 1,282 215 36,084 8 1,472 645	－ (3,073) (513) － － (109) －	－ － － － 42 － －	49,947 15,041 1,310 200,315 50 36,564 1,230
	265,643	42,467	(3,695)	42	304,457
	$ 604,868	$ 95,886	$ (352)	$ 1,347	$ 701,749

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Item		January 1 to December 31, 2021	January 1 to December 31, 2021	January 1 to December 31, 2021
	Balance at the beginning of period	Acquired	Disposed	Consolidated acquisition	Balance at the end of period
Cost Land Buildings Machinery Equipment Office Equipment Power Generation Equipment Other Equipment Leasehold improvements Subtotal Accumulated Depreciation and Impairment Buildings Machinery Equipment Office Equipment Power Generation Equipment Other Equipment Leasehold improvements Subtotal Net amount	$ 45,719 90,044 43,327 2,774 660,343 48,471 3,348	$ － 9,458 932 800 916 648 －	$ － － 25,911 1,014 983 8,361 －	$ － － － － － － －	$ 45,719 99,502 18,348 2,560 660,276 40,758 3,348
	894,026	12,754	36,269	－	870,511
	44,685 42,570 2,445 131,064 41,965 251	2,501 160 177 33,462 1,597 334	－ 25,898 1,014 295 8,361 －	－ － － － － －	47,186 16,832 1,608 164,231 35,201 585
	262,980	38,231	35,568	－	265,643
	$ 631,046	$ (25,477)	$ 701	$ －	$ 604,868

1. The Consolidated Company depreciates each component item on a straight-line basis over its useful life as follows:

basis over its useful life as follows:
Item	Useful Life
Buildings Machinery Equipment Office Equipment Power Generation Equipment Other Equipment Leasehold improvements	35 years 2 to 14 years 2 to 7 years 15 to 20 years 2 to 20 years 9 years

1. The Consolidated Company's property, plant and equipment pledged as collaterals for long-term and short-term loans in December 31, 2022 and 2021. Please refer to Note 8 for details.

2. (IX) Lease Agreements

3. Right-of-use assets

Carrying amount of right-to-use assets Buildings Transport Equipment Total	December 31,2022 $ 125,316 1,201 $ 126,517	December 31,2021
		$ 125,079 662
		$ 125,741

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FY2022 Newly acquired right-of-use assets $ 13,307 Lease modification (lease cancellation) $ 3,167 Depreciation expense of right-of- use assets Buildings $ 8,805 Transport Equipment 559 Total $ 9,364 Leasing liabilities December 31,2022 Carrying amount of lease liabilities Current $ 8,646 Non-current $ 120,960 The discount rate range for lease liabilities is as follows: December 31,2022 Buildings 1.6％～2.71％ Transport Equipment 1.88％～2.12％	FY2021
	$ 87,878
	$ －
	$ 7,316 654
	$ 7,970
	December 31,2021
	$ 7,045
	$ 120,613
	December 31,2021
	1.6％～2.71％ 1.88％

2. Leasing liabilities

3. Significant leasing activities and terms

The Consolidated Company leases the above transportation equipment for a period of 3 years.

The Consolidated Company also leases the building for office and solar farm for power generation for a period of 10 and 20 years.

4. Other Lease Information

4. Other Lease Information	4. Other Lease Information
Short-term lease expenses Low-value asset lease expenses Variable lease expenses not included in the measurement of lease liabilities Total cash expenditure for leases (outflow) Other Intangible Assets Item Balance at the beginning of period Cost Computer software $ 665 Goodwill － Operating rights 32,417 Subtotal 33,082 Accumulated amortization and impairment Computer software 243 Operating rights 5,043 Subtotal 5,286 Net amount $ 27,796			FY2022 $ 1,680 $ $ 433 $ $ 1,500 $ $ (14,699) $ January1toDecember31,2022			FY2021
					$	1,026
					$	1,010
					$	312
					$	(11,670)
	Balance at the beginning of period		Acquired	Disposed		Balance at the end of period
Cost Computer software Goodwill Operating rights Subtotal Accumulated amortization and impairment Computer software Operating rights Subtotal Net amount	$ 665 － 32,417		$ 502 1,265 －	$ － － －		$ 1,167 1,265 32,417
	33,082		1,767	－		34,849
	243 5,043		134 2,161	－ －		377 7,204
	5,286		2,295	－		7,581
	$ 27,796		$ (528)	$ －		$ 27,268

(X) Other Intangible Assets

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Item		January1toDecember31,2021	January1toDecember31,2021
	Balance at the beginning of period	Acquired	Disposed	Balance at the end of period
Cost Computer software Operating rights Subtotal Accumulated amortization and impairment Computer software Operating rights Subtotal Net amount	$ 665 32,417	$ － －	$ － －	$ 665 32,417
	33,082	－	－	33,082
	111 2,881	132 2,162	－ －	243 5,043
	2,992	2,294	－	5,286
	$ 30,090	$ (2,294)	$ －	$ 27,796

Amortization expense is provided on a straight-line basis over the following number of durable years:

f durable years:
Item		Useful Life
Computer software		5 years
Operating rights		15 years
repayments
	December	31,2022		December	31,2021
Prepayment	$	22,463		$	－
Prepaid insurance fees		1,704			662
Prepaid pensions		570			570
Others		10,428			1,447
Total	$	35,165		$	2,679
Prepayment for equipment purchase	$	781,624		$	443,532
Less: Accumulated impairment		(23,918)			(23,918)
Total	$	757,706		$	419,614
Current	$	35,165		$	2,679
Non-current	$	757,706	$		419,614

(XI) Prepayments

For the assessment of the accumulated impairment on prepayment for equipment, please refer to Note 9(2).

(XII) Other Current Assets

Other Current Assets
December 31,2022 Input tax $ 38,377 Tax overpaid retained for offsetting future tax payable 5,695 Payments on behalf of others 170 Others － Total $ 44,242	December 31,2021
	$ 18,315 836 1,879 236
	$ 21,266

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(XIII) Long-Term Notes and Accounts Receivable

Accounts receivable - Taiwan Power Company (Taichung Power Plant) (Note 1) Accounts receivable - Taiwan Power Company (Offshore Wind Power Development In Taichung Port) Estimated additional receivables from construction and engineering work Less: Estimated overdue fines payable Less: Allowance for losses Subtotal of construction and engineering receivables Other receivables - Chou, Hsiu-Mei Less: Allowance for losses Subtotal	December 31,2022 $ 355,600 17,226 13,740 (141,000) (37,575) $ 207,991 $ 42,888 (42,888) $ －	December 31,2021
		$ 355,600 17,226 13,740 (141,000) (37,575)
		$ 207,991
		$ 42,888 (42,888)
		$ －

1. The Consolidated Company filed an arbitration case for the delayed completion of the Taichung Power Plant and Offshore Wind Power Development In Taichung Port of Taiwan Power Company (Taipower). The arbitration judgment was issued by the Chinese Construction Industry Arbitration Association(CCIAA) on January 19, 2010 (2008 Gong-Zhong-Xie-Jing-Zi No. 019) and a judgement was issued by the High Court on May 31, 2011 (2010 Zhong-Shang-Zi No. 501). The Company recorded NT$141,000 thousand in overdue penalties and NT$13,740 thousand in additional receivables due for construction work based on the arbitration judgement. However, the parties did not reach a consensus on the settlement amount, which resulted in the delay in payment by Taipower, so the accounts were reclassified as long-term accounts receivable. Please refer to Note 9(3) for details.

2. In August 2012, the Consolidated Company sold 1,300,000 shares of its equitymethod investment in Dakang Insurance Brokerage Co., Ltd. at NT$48 per share, for a total consideration of NT$62,400 thousand. The transferee of the equity, Hsiu-Mei Chou, issued a promissory note when entering into the equity transfer contract and pledged the stocks to the Group. Since the transferee could not subsequently repay on time according to the contract, new agreements were entered into on March 25, 2013 and August 12, 2013, respectively, and an interest at an annual rate of 6% was imposed until March 25, 2014. As of December 31, 2022 and 2021, a sum of NT$42,888 thousand (including the principal of NT$40,480 thousand with the interest receivable of NT$2,408 thousand) had not been collected yet. The Consolidated Company has transferred it to the long-term accounts receivable and set aside an allowance for loss of a percentage of 100%. Besides, the Consolidated Company filed an action for payment of the note against Hsiu-Mei Chou’s endorser, Dah Sing Network Technology Co., Ltd., on February 26, 2015. The action was dismissed by the court on February 3, 2016. The Consolidated Company filed an appeal against the dismissal on March 4, 2016 and the high court delivered its decision (2016 Chong-Shang-Zi No. 325) in favor of the Consolidated Company on May 9, 2017. However, Dah Sing Network Technology Co., Ltd. appealed the decision to the Supreme Court. On February 27, 2020, the Supreme Court ruled (2019 Tai-Shang-Zi No. 1237) that the original judgment, with the exception of the provisional execution, was abrogated and remanded the case to the Taiwan High Court for retrial. On

32

December 22, 2020, the High Court ruled in favor of the Consolidated Company (2020 Zhong-Shang-Geng-Yi-Zi No. 38). While Dah Sing Network Technology Co., Ltd. did not file an appeal, the Company has assessed that the possibility of debt recovery was low, henceforth the Company did not reverse the recognized allowance for loss.

1. The Consolidated Company considers the customer's past default record and current financial condition, as well as the possible outcome of future court decisions. If there is evidence that the counter-party is facing severe financial difficulties or the judgment may be unfavorable to the Consolidated Company, and the Consolidated Company cannot reasonably expect to recover the amount, the Consolidated Company will directly write off the related receivables, but shall continue to pursue debt recovery activities and recognize the amount recovered in profit or loss.

(XIV) Short-term Borrowings

Short-term Borrowings
Secured loans Credit loans Less: Unamortized bank borrowing costs Total Interest Rate Range	December 31, 2022 $ 130,000 110,640 － $ 240,640 1.90%～2.30%	December 31, 2021
		$ 113,500 36,500 291
		$ 149,709
		1.6%

For the guarantee of assets provided as short-term loans, please refer to Note 8.

• (XV) Long-term Borrowings

Long-term Borrowings
Secured loans Less: Unamortized cost of long- term bank borrowings Subtotal Less: Loan maturity classified as due within one year Long-term borrowings Interest Rate Range	December 31, 2022 $ 746,384 － 746,384 (47,081) $ 699,303 2.05%～2.32%	December 31, 2021
		$ 381,786 1,966
		379,820 (43,795)
		$ 336,025
		1.8％～2.66％

The above-mentioned bank loans shall mature successively before November 2027. Please refer to Note 8 for information on assets pledged as collateral for long-term borrowings.

• (XVI) Notes and Accounts Payable

Notes and Accounts Payable
Notes payable (including to related parties) Accounts payable (including to related parties) Total	December 31, 2022 $ 2,027 99,540 $ 101,567	December 31, 2021
		$ 331 119,371
		$ 119,702

1. The average credit period for accounts payable is generally 30 to 60 days for customers, and for outsourced projects, payment is made according to the contract period agreed to between the two parties. The Company upholds a financial risk management policy to ensure that all payables are repaid within the pre-agreed credit terms.

2. Please refer to Note 6(28) for disclosures of payables and other payables that are exposed to liquidity risk.

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(XVII) Post-employment benefit plans

1. Defined contribution plan

The Consolidated Company's pension plan under the Labor Pension Act is a government-administered defined contribution plan that contributes 6% of employees' monthly salaries to the individual accounts under the Bureau of Labor Insurance. The pension cost recognized as expense in the consolidated statements of income was NT$1,568 thousand and NT$1,266 thousand for FY2022 and FY2021, respectively.

(XVIII) Equity

1. Common share capital

Common share capital
Number of shares (in thousands) Authorized share capital Number of issued and fully paid shares (in thousands) Publicly traded common stock	December 31, 2022 600,000 $ 6,000,000 145,486 $ 1,454,858	December 31, 2021
		600,000
		$ 6,000,000
		135,968
		$ 1,359,680

The issued common stock has a par value of $10 per share and each share has one vote and the right to receive dividends.

On March 5, 2021, the Board of Directors adopted a follow-on offering to issue 40,000 thousand shares at a par value of NT$10. The stocks were issued at a premium of NT$ 12.6 per share. The paid-in capital was NT$1,359,680 after the execution of the offering. The base day for the offering was September 2, 2021. The relevant change registration procedures have been duly completed.

At the annual general shareholders' meeting held on June 21, 2022, for the dividend distribution for FY2021, the shareholders resolved to distribute NT$95,178 thousand in stock dividends at NT$0.7 per share, resulting in a capital stock of NT$1,454,858 thousand after the distribution.

1. Capital reserve

Capital reserve
May be used to make up losses, to distribute cash or to	December 31, 2022 $ 133,054	December 31, 2021
		$ 133,054
increase capital Stock issuance in excess of par value

On September 2021, the Company issued 40,000 thousand shares at a par value of NT$10 per share, at a premium of NT$12.6 per share, resulting in an increase in capital surplus of NT$104,000 thousand.

The capital surplus from the stock issuance premium may be used to offset losses or, when the Company has no losses, to distribute cash or to increase capital, provided that the capitalization is limited to a certain percentage of the paid-in capital each year.

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3. Policy on retained earnings and dividends

In accordance with the provisions of the Company's Articles of Incorporation on the earnings distribution policy, if having a profit in the final accounting of the year, the Company shall first pay taxes and make up any cumulative losses in accordance with laws, and then set aside 10% of the said earnings as legal reserves, unless such legal reserves reach the amount of the Company’s paid-in capital. Any surpluses remaining shall then be subject to provision or reversal of special reserves, as the laws may require. If there is any residual balance, it shall be, together with the undistributed earnings carried from previous years, used as dividends for shareholders. The Board of Directors shall draft an earnings distribution proposal and submit it to the shareholders’ meeting for approval. Please refer to Note 6(24), "Remuneration to Employees and Directors", for the policy on the distribution of employees and directors' remuneration under the amended Articles of Incorporation.

Legal reserve may be used to make up losses. If the Consolidated Company has no deficit, the excess of legal reserve over 25% of the paid-in capital may be distributed in cash in addition to increasing capitalization.

At the annual general shareholders' meetings held on June 21, 2022 and May 7, 2021, the Company approved the following distribution of earnings for the FY2021 and FY2020, respectively:

FY2021 and FY2020, respectively:
FY2021 Legal reserve $ 11,222 Cash dividend (NT$0.2 and NT$0.5 per share respectively) $ 27,193 Stock dividends (NT$0.7 per share) $ 95,178 4. Non-controlling equity FY2022 Balance at the beginning of period $ 4,367 Net loss for the period attributable to noncontrolling interests 1,354 Other comprehensive income or loss attributable to noncontrolling interests: Financial assets measured at fair value through other comprehensive income or loss (176) Exchange difference from conversion of financial statements of foreign operations 13 Decrease in non-controlling interests in subsidiaries due to disposals (1,201) Acquisition of additional non- controlling interests in subsidiaries 55,856 Balance at the end of period $ 60,213	FY2020
	$ 6,208
	$ 47,984
	$ －
	FY2021
	$ － 563 － (13) － 3,817
	$ 4,367

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(XIX) Earnings Per Share

1. Basic earnings per share

The weighted-average number of shares of common stock and earnings per share used in the calculation of earnings per share were as follows:

Net income attributable to owners of the parent company (NT$ ‘000) Weighted-average number of common shares for basic earnings per share calculation (in thousands) Basic earnings per share (NT$)	FY2022 $ 45,080 145,486 $ 0.31	FY2021
		$ 112,220
		118,819
		$ 0.94

Earnings per share have been retroactively adjusted for the effect of stock grants, the base date of which was set on September 16, 2022. The basic earnings per share was retroactively adjusted from NT$1.03 to NT$0.94 for FY2021.

2. Diluted earnings per share

The weighted-average number of shares of common stock and earnings used to calculate diluted earnings per share were as follows:

Net income attributable to owners of the parent company Weighted-average number of common shares for basic earnings per share calculation (in thousands) Impact of common stock with potential dilutive effects Employee remuneration Weighted-average number of common shares for the purpose of calculating diluted earnings per share Diluted earnings per share (NT$)	FY2022 $ 45,080 145,486 67 145,553 $ 0.31	FY2021
		$ 112,220
		118,819 54
		118,873
		$ 0.94

If the Consolidated Company has the option to pay employees in stock or cash, the calculation of diluted earnings per share assumes that employee remuneration will be paid in stock and is included in the weighted-average number of common shares outstanding for the purpose of calculating diluted earnings per share when the potential common shares have a dilutive effect. The dilutive effect of these potential common shares will continue to be considered in the calculation of diluted earnings per share before the number of shares awarded to employees is determined in the following year's shareholders’ resolution.

As a result of the retroactive adjustment, the diluted earnings per share was retroactively adjusted from NT$1.03 to NT$0.94 for FY2021.

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(XX) Revenue from Customer Contracts

Revenue from Customer Contracts Construction revenue Sales revenue Electricity retailing revenue Service revenue Others Total 1. Contract balance Accounts receivable and notes receivable Contract assets - current Construction of photovoltaic power station and booster station Construction and engineering Sales of electrical equipment Electricity retailing revenue Total Contract liabilities - current Construction of photovoltaic power station Construction and engineering Total	FY2022 $ 83,617 72,165 119,012 － 6,726 $ 281,520 December31,2022 $ 67,897 $ 41,990 25,878 410 － $ 68,278 $ 6,224 178 $ 6,402	FY2021
		$ 93,322 121,433 79,993 25,829 3,869
		$ 324,446
		December31,2021
		$ 198,016
		$ 21,587 － 236 209
		$ 22,032
		$ 396 －
		$ 396

The variation of the contract assets and liabilities is the result of the difference in the time point when the Group fulfills the obligations and the customer makes the payment.

2. Breakdown of revenue from customer contracts

FY2022

		FY2022	FY2022
Contract revenue type		Reportable segments			Total
	Energy Business Group	Electrical Engineering Business Group	Construction Business Group	Others
	$ 39,525 － 119,012 453	$ 25,179 72,165 － 6,272	$ 18,913 － － －	$ － － － 1	$ 83,617 72,165 119,012 6,726
Construction revenue Sales revenue Electricity retailing revenue Others Total Point in time for revenue recognition: At a certain point in time To be satisfied over time Total
	$ 158,990	$ 103,616	$ 18,913	$ 1	$ 281,520
	$ 119,465 39,525	$ 78,437 25,179	$ － 18,913	$ 1 －	$ 197,903 83,617
	$ 158,990	$ 103,616	$ 18,913	$ 1	$ 281,520

FY2021

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Contract revenue type		Reportable segments	Reportable segments		Total
	Energy Business Group	Electrical Engineering Business Group	Construction Business Group	Others
	$ 22,612 － 79,993 25,829 675	$ 70,710 121,433 － － 1,614	$ － － － － －	$ － － － － 1,580	$ 93,322 121,433 79,993 25,829 3,869
Construction revenue Sales revenue Electricity retailing revenue Service revenue Others Total Point in time for revenue recognition: At a certain point in time To be satisfied over time Total
	$ 129,109	$ 193,757	$ －	$ 1,580	$ 324,446
	$ 106,497 22,612	$ 123,047 70,710	$ － －	$ 1,580 －	$ 231,124 93,322
	$ 129,109	$ 193,757	$ －	$ 1,580	$ 324,446

(XXI) Non-operating Income and Expenses

1. Interest income Bank deposits 2. Other revenue Dividend income Other revenue Total 3. Other profits and losses Gain (loss) on financial assets at fair value through profit or loss Profit from lease changes Loss from disposal of property, plant, and equipment Disposal of investment interests Financial assets impairment loss Others Net amount 4. Financial cost Interest on bank loans Interest on lease liabilities Less: Amount of interest capitalized Net amount Rate of capitalized interest	FY2022 $ 1,237 FY2022 $ 622 1,598 $ 2,220 FY2022 $ (8,040) 12 (307) 250 － (2,770) $ (10,855) FY2022 $ 14,826 2,906 (6,655) $ 11,077 1.86％～2.2％	FY2021
		$ 524
		FY2021
		$ 587 11,862
		$ 12,449
		FY2021
		$ 7,832 90 (346) － (189) (319)
		$ 7,068
		FY2021
		$ 9,109 2,429 (1,330)
		$ 10,208
		1.23％～1.84％

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(XXII) A Summary of the Depreciation and Amortization Expense Function Is Presented Below:

FY2022 Property, plant and equipment $ 42,467 Right-of-use assets 9,364 Other intangible assets 2,295 Total $ 54,126 Summary of depreciation expense by function Operating costs $ 48,193 Operating expenses 3,638 Total $ 51,831 Summary of depreciation expense by function Operating expenses $ 2,295 (XXIII) Employee Benefit Expenses FY2022 Short-term employee benefits Salary $ 33,338 Labor Insurance and National Health Insurance 4,904 Defined contribution plan 1,568 Remuneration to directors 665 Others 2,257 Total $ 42,732 Summary by function Operating costs $ 20,829 Operating expenses 21,903 Total $ 42,732	FY2021
	$ 38,231 7,970 2,294
	$ 48,495
	$ 42,845 3,356
	$ 46,201
	$ 2,294
	FY2021
	$ 24,989 2,547 1,266 750 2,238
	$ 31,790
	$ 13,598 18,192
	$ 31,790

(XXIV) Remuneration to Employees and Directors

In accordance with the Company's Articles of Incorporation, the Company contributes no less than 1% and no more than 1% of the pre-tax benefit to employees' and directors' remuneration, respectively, for the year before the distribution of employees' and directors' remuneration. The estimated remuneration to employees for FY2022 and FY2021 were as follows:

Employee remuneration Remuneration to directors Cash Employee remuneration	FY2022 1％ 0％ FY2022 $ 458	FY2021
		1％ 0％ FY2021
		$ 1,146

If there is a change in the amount of the annual consolidated financial report after the date of its issuance, the change in accounting estimate is treated as an adjustment in the following year.

There was no difference between the actual amount of employees' remuneration and the amount recognized in the consolidated financial statements for FY2021.

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For additional information on the remunerations to the employees and directors approved by the Board, visit the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(XXV) Income Taxes

1. The major components of income tax expense (benefit) recognized in profit or loss were as follows

loss were as follows
FY2022 Current income tax Generated in the current period $ 9,150 Additional taxes levied on undistributed earnings 209 Adjusted from the previous year 446 Basic tax amount － Deferred income tax Generated in the current period 20 Adjusted from the previous year － Income tax expense recognized in profit or loss $ 9,825	FY2021
	$ 2,429 276 － 376 (1,100) 1,948
	$ 3,929

1. The reconciliation of accounting income and income tax expense (benefit) is as follows:

The reconciliation of accounting income and income tax follows:	expense (benefit) is as
FY2022 Income tax expense on net income before income tax at statutory tax rate $ 17,944 Tax-exempt income (124) Non-deductible expenses for tax purposes 1,767 Net domestic investments recognized under the equity method (6,760) Basic tax amount － Additional taxes levied on undistributed earnings 209 Unrecognized temporary differences 902 Unrecognized loss carryforward － Unrecognized loss carryforwards offset against current period (4,580) Adjustment in the current year for the income tax expenses of the previous year 446 Others 21 Income tax expense recognized in profit or loss $ 9,825	FY2021
	$ 26,367 (1,683) 102 (2,721) 376 276 (4,395) (16,341) － 1,948 －
	$ 3,929

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3. Income tax assets and liabilities in the current period

December 31, 2022 December 31, 2021

Income tax assets in current period Tax refund receivable Income tax liabilities in current period Income taxes payable	$ 46 $ 1,306 $ 8,940 $ 3,070

4. The changes in deferred income tax assets and liabilities are as follows:

Balance at the beginning of period Deferred income tax assets Loss of end-of-life assets $ 1,234 Deferred income tax liabilities Investment income of subsidiaries $ 134 Unrealized valuation benefits － $ 134 Balance at the beginning of period Deferred income tax assets Loss of end-of-life assets $ － Deferred income tax liabilities Investment income of subsidiaries $ －		FY2022	FY2022
	Balance at the beginning of period	Recognized in gain (loss)	Recognized in other comprehensive income	Balance at the end of period
	$ 1,234	$ (92)	$ －	$ 1,142
		$ (134) (62)	$ － －	$ － (62)
	$ 134	$ 196	$ －	$ (62)
	Balance at the beginning of period	Recognized in gain (loss)	Recognized in other comprehensive income	Balance at the end of period
	$ －	$ 1,234	$ －	$ 1,234
		$ 134	$ －	$ 134

1. The amount of deferred income tax assets not recognized in the consolidated balance sheet:

balance sheet:
December 31, 2022 Loss deductions $ 152,174 Temporary differences that can be deducted 99,400 Total $ 251,574	December 31, 2021
	$ 195,208 255,157
	$ 450,365

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1. As of December 31, 2022, Information on individual unused tax losses and approved income tax returns within the Consolidated Company is summarized as follows:

follows:
Yearofoccurrence The Company FY2013 (authorized) FY2014 (authorized) FY2015 (authorized) FY2017 (authorized) Subsidiary - Le Hua FY2022 (estimate) Subsidiary - Le Yang FY2015 (authorized) FY2016 (authorized) FY2017 (authorized) FY2019 (authorized) FY2020 (authorized) FY2021 (declared) FY2022 (estimate)	Deductible amount $ 24,709 14,378 86,597 24,752 $ 150,436 $ 148 $ 68 475 157 123 132 464 171 $ 1,590	Finaldeductionyear
		2023 2024 2025 2027 2032 2025 2026 2027 2029 2030 2031 2032

7. Status of approved income taxes

The income tax returns of the Company and its subsidiaries for FY 2020 have been examined and approved by the tax authorities.

(XXVI) Business Combinations

1. Acquisition of subsidiaries

Acquired companies FY2022 Wan Chuan Construction Co., Ltd. FY2021 Joy Ribbon Limited	Main business scope Comprehensive Construction Activities International Trade in Energy Products	Date of acquisition November 28, 2022 October 21, 2021	Shareholdi ng ratio 52.5% 51%	Transfer consideration
				$ 63,000
				$ 1,422

2. Assets acquired and liabilities assumed at the date of acquisition

Current assets Cash Other current assets Non-current assets Property, plant and equipment Other non-current assets Current liabilities Non-current liabilities Net assets acquired	November 28, 2022 $ 78,603 21,904 1,347 22,632 (7,088) － $ 117,398	October 21, 2021
		$ 2,849 304 － － (364) －
		$ 2,789

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1. Net cash outflow from acquisition of subsidiaries

Consideration paid Add: Cash acquired Net Cash Inflow	November 28,2022 $ (63,000) 78,603 $ 15,603	October 21,2021
		$ (1,422) 2,849
		$ 1,427

1. Effect of business combinations on operating results

The results of operations from the investee company from the date of acquisition are as follows:

are as follows:
Operating revenue Net profit Other comprehensive income	Acquisition date to December 31, 2022 $ 18,913 $ 1,559 $ (194)	Acquisition date to December 31, 2021
		$ 1,580
		$ 669
		$ (13)

(XXVII) Capital Risk Management

The Consolidated Company is required to maintain sufficient capital to meet the concerns of going concern assumptions. Therefore, the Consolidated Company's capital is prudently managed to ensure that the necessary financial resources and operating plans are in place to support future needs for working capital, capital expenditures and debt servicing.

(XXVIII) Financial Instruments

1. Fair value information - financial instruments not measured at fair value

The carrying amounts of the Consolidated Company's financial instruments not carried at fair value, such as cash, financial assets carried at amortized cost, accounts receivable, other receivables, refundable deposits, long-term and shortterm loans (including long-term loans due within one year), accounts payable, other payables and guarantee deposits received, are a reasonable approximation of fair value.

1. Fair value information - financial instruments measured at fair value on a recurring basis

2. (1) Fair value hierarchy

Financial assets at fair value through profit or loss Domestic listed (Over-the-Counter) stocks Financial assets at fair value through other comprehensive income or loss-non-current Domestic TWSE (TPEx) unlisted stocks Financial assets at fair value through profit or loss Domestic listed (Over-the-Counter) stocks		December 31, 2022	December 31, 2022
	Level 1	Level 2	Level3	Total
	$ 68,723 －	$ － －	$ － 25,278	$ 68,723 25,278
	$ 68,723	$ －	$ 25,278	$ 94,001
	Level 1	Level 2	Level 3	Total
	$ 19,490	$ －	$ －	$ 19,490

43

• (2) There were no transfers between Level 1 and Level 2 fair value measurements from January 1 to December 31 2022 and 2011.

• (3) Reconciliation of financial instruments measured at fair value on a Level 3 basis

basis
Balance at the beginning of period Recognized in other comprehensive income Balance at the end of period		Financial assets at fair value through other comprehensive income or loss-non-current
		December 31, 2022 $ 25,472 (194) $ 25,278	December 31, 2021
			$ － －
			$ －

• (4) For equity instruments without quoted prices in active markets for Level 3 fair value measurements, the Company measures the fair value of the investee by taking into account the quoted prices not available in active and inactive markets, the net financial statements of the investee for the same period obtained by the Company, the changes in the investee's plans, performance, investment objectives, management, etc., and the Company's expected return on investment through the distribution of earnings of the investee.

• Types of financial instruments

Types of financial instruments
Financial assets Financial assets at fair value through profit or loss Financial assets carried at amortized cost (Note 1) Financial assets measured at fair value through other comprehensive income or loss Total Financial liabilities Measured at amortized cost (Note 2) Lease liabilities Total	December 31, 2022 $ 68,723 986,184 25,278 $ 1,080,185 $ 1,130,646 129,606 $ 1,260,252	December 31, 2021
		$ 19,490 1,274,771 －
		$ 1,294,261
		$ 764,354 127,658
		$ 892,012

• Note 1: The balance includes cash, financial assets carried at amortized cost, notes receivable, accounts receivable, other receivables, long-term notes and accounts receivable and refundable deposits, and other financial assets carried at amortized cost.

• Note 2: The balance consists of financial liabilities measured at amortized cost, including long-term loans (including long-term borrowings due within one year), notes payable, accounts payable, other payables and guarantee deposits.

44

1. Financial risk management objectives and policies

The Group’s main financial instruments includes accounts receivable, accounts payable, and borrowings. The Consolidated Company's finance department provides services to each business unit, coordinates access to domestic and international financial markets, and monitors and manages the financial risks associated with the Company's operations through internal risk reports that analyze risk exposures based on the level and breadth of risk. These risks include market risk (including interest rate risk and other price risks), credit risk and liquidity risk.

(1) Market risk

A. Interest rate risk

The carrying amounts of the Consolidated Company's financial assets and financial liabilities exposed to interest rate risk as of the balance sheet date were as follows:

were as follows:
Fair value interest rate risk Financial Assets Financial liabilities Cash flow rate risk Financial Assets Financial liabilities	December 31, 2022 $ 210,114 370,246 448,891 746,384	December 31, 2021
		$ 167,449 277,367 638,691 379,820

Sensitivity analysis

The following sensitivity analysis is based on the interest rate risk of nonderivative instruments at the balance sheet date. For floating rate liabilities, the analysis assumes that the amount of the liability outstanding at the balance sheet date is outstanding for the period reported. The rate of change used in the Consolidated Company's internal reporting of interest rates to key management is a one-digit increase or decrease in interest rates, which also represents management's assessment of the range of reasonably possible changes in interest rates.

If interest rates were to increase or decrease by 0.25%, with all other variables held constant, the Consolidated Company's pre-tax income would increase/decrease by NT$1,345 thousand and NT$273 thousand for FY2022 and FY2021 respectively, due to the Company's exposure to interest rate risk on cash flows from variable rate deposits and borrowings.

• B. Other price risk

The Consolidated Company has equity price risk due to its investment in domestic listed securities. The management of the Consolidated Company manages the risk by holding different risky investment portfolios.

Sensitivity analysis

The following sensitivity analysis was performed based on the equity price risk at the balance sheet date.

If equity prices increased/decreased by 1%, net income before income tax would have increased/decreased by NT$687 thousand and NT$195 from January 1 to December 31 2022 and 2021 respectively, due to the increase/decrease in the fair value of financial assets at fair value through profit or loss.

45

The increase in sensitivity of the Consolidated Company to equity investments was mainly due to the increase in equity investments.

(2) Credit risk

Credit risk refers to the risk of financial loss resulting from the counter-party's default on contractual obligations. Up to the balance sheet date, the Group’s potential highest credit risk exposure due to failure of the counterparty to fulfill its obligations was mainly derived from the unlikelihood of collecting the receivables from the customer.

As of December 31, 2022 and 2021, the percentages of accounts receivable from the top ten customers to the Consolidated Company's accounts receivable were 70.10% and 99.97%, respectively, and the credit concentration risk of the remaining accounts receivable was relatively insignificant.

(3) Liquidity risk

• A. Liquidity and interest rate risk of non-derivative financial liabilities

The analysis of the remaining contractual maturities of non-derivative financial liabilities is based on the undiscounted cash flows (including principal and estimated interest) of the financial liabilities based on the earliest possible date on which the Consolidated Company could be required to make repayment. Accordingly, the Consolidated Company's bank loans that are repayable on demand are listed in the table below at the earliest possible date, without regard to the probability that the banks will enforce rights immediately; the maturity analysis of other non-derivative financial liabilities is prepared based on the contractual repayment dates.

The undiscounted interest amount of interest cash flows paid at floating interest rates is derived from the borrowing rate at the balance sheet date.

December 31, 2022

Non-derivative financial liabilities Non-interest- bearing liabilities Floating rate instruments Lease liabilities Total More Lease liabilities	Less than 6 months	6 months to 1 year	1 to 2 years	More than 2 years	Total
	$ 136,772 273,780 5,837	$ － 31,687 5,616	$ － 62,328 11,331	$ 946 661,106 131,190	$ 137,718 1,028,901 153,974
	$ 416,389	$ 37,303	$ 73,659	$ 793,242	$1,320,593
	information on the analysis Less than 1 year 1 to 5 years $ 11,453 $ 43,615				16 to 20 years
	$ 11,453	$ 43,615	$ 43,484	$ 37,919	$ 17,503

Non-derivative financial liabilities Non-interest- bearing liabilities Floating rate instruments Lease liabilities Total		December 31, 2021	December 31, 2021	December 31, 2021
	Less than 6 months	6 months to 1 year	1 to 2 years	More than 2 years	Total
	$ 234,708 26,289 5,275	$ － 280,685 4,588	$ － 41,476 9,256	$ 117 213,083 135,290	$ 234,825 561,533 154,409
	$ 266,272	$ 285,273	$ 50,732	$ 348,490	$ 950,767

46

More information on the analysis of lease liabilities due:

Less than 1 year 1 to 5 years 6 to 10 years Lease liabilities $ 9,863 $ 38,706 $ 43,484 B. Financing amount December 31, 2022 Unsecured bank loan credit line - Amount utilized $ 110,640 - Unutilized amount 138,620 Total $ 249,260 Guaranteed Bank credit line -Amount utilized $ 876,384 -Unutilized amount 176,031 Total $ 1,052,415	Less than 1 year	1 to 5 years	1 to 5 years	6 to 10 years	11 to 15 years	11 to 15 years	16 to 20 years
	$ 9,863	$	38,706	$ 43,484	$	39,171	$ 23,185
			December 31, 2022
			$ 110,640 138,620			$ 36,500 －
			$ 249,260			$ 36,500
			$ 876,384 176,031			$ 667,710 2,092,234
			$ 1,052,415			$ 2,759,944

(XXIX) Disposal of Subsidiaries

On April 22, 2022, the Board of Directors resolved to dispose of Joy Ribbon Limited, of which the Company owned a 51% equity interest. On May 10, 2022, the Company entered into a share transaction agreement and lost control of Joy Ribbon Limited.

1. Consideration received

Consideration received
Cash and cash equivalents Receivable from disposal of investments Total consideration received	Amount
	$ 1,500 －
	$ 1,500

1.	Consideration received Cash and cash equivalents Receivable from disposal of investments Total consideration received	Amount $ 1,500 － $ 1,500	Amount $ 1,500 － $ 1,500
2.	Analysis of assets and liabilities subject to loss of control	as at the date of loss
	of control
			Amount
	Current assets
	Cash and cash equivalents	$	2,646
	Net assets disposed of	$	2,646
3.	Interests from the disposal of subsidiaries
			Amount
	Consideration received	$	1,500
	Net assets disposed of		(2,646)
	Non-controlling equity		1,296
	Cumulative translation difference between equity
	reclassification and profit or loss of a subsidiary's net		100
	assets due to loss of control over the subsidiary
	Interests from the disposal	$	250
4.	Net cash outflow from disposal of subsidiaries
			Amount
	Consideration received	$	1,500
	Less: Balance of cash and cash equivalents from disposal		(2,646)
	Net cash outflow	$	(1,146)

As of December 31, 2022, the Group had received NT$1,500 thousand for the disposal of the equity interest in Joy Ribbon Limited.

47

VII. Related Party Transactions

All transactions, account balances, revenues and expenses between the Company and its subsidiaries (related parties of the Company) are eliminated upon consolidation and are therefore not disclosed in this note. Transactions between the Group and other related parties are described as follows:

• (1) Names of related parties and their relationships

Name of relatedparty Ching Tien Energy and System Co., Ltd. (hereinafter referred to as "Ching Tien Energy") Chao Hsing Energy Co., Ltd. (hereinafter referred to as "Chao Hsing Energy") Sel Tech Co., Ltd. (hereinafter referred to as "SEL Tech") Solargo Tech Co., Ltd. (hereinafter referred to as "Solargo") Quintain Steel Co., Ltd. (hereinafter referred to as "Quintain") Chateau Rich Hotel Co., Ltd. (hereinafter referred to as "Chateau Rich") Castle Applied Inc. (hereinafter referred to as "Castle Applied") Gala Castle Co., Ltd. (hereinafter referred to as "Gala Castle") Jing Hao Landscape Design Company Limited (hereinafter referred to as "Jing Hao Landscape Design") Mei Chi Interior Design and Engineering Co., Ltd. (hereinafter referred to as "Mei Chi Interior Design")

Relationshipwith the Company

Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party

(II) Operating revenue

Operating revenue
FY2022 Ching Tien Energy and System Co., Ltd. $ 28,679 Solargo Tech Co., Ltd. － Other related party 8,240 Total $ 36,919	FY2021
	$ 16,669 127,040 9,160
	$ 152,869

48

1. Ching Tien Energy and System Co., Ltd. and Chao Hsing Energy Co., Ltd. subcontract photovoltaic equipment projects including installation services. These projects are subcontracted to Sel Tech Co., Ltd. The financial statements of the Company present the construction revenue after deducting the cost of the outsourcing. Prices and payment terms are based on individual agreements between the parties for each project.

between the parties	for each project.
FY2022 Ching Tien Energy Other related party Total FY2021 Ching Tien Energy Other related party Total	Construction and engineering revenue	Construction and engineering cost	Net amount
	$ 156,143 37,534	$ 127,464 29,294	$ 28,679 8,240
	$ 193,677	$ 156,758	$ 36,919
	$ 83,919 41,070	$ 67,250 31,910	$ 16,669 9,160
	$ 124,989	$ 99,160	$ 25,829

1. Solargo Tech Co., Ltd. generates operating income from equipment and installation of booster stations, and the prices and terms of payment are based on individual agreements between the both transactional parties for each project.

(III) Purchases

(III) Purchases
FY2022 Sel Tech Co., Ltd. $ 157,799 Other related party 1,661 Total $ 159,460 (IV) Contract Assets December 31, 2022 Ching Tien Energy $ 24,914 Other related party 3,104 Total $ 28,018 (V) Accounts Receivables From Related Parties December 31, 2022 Accounts receivable Ching Tien Energy $ － Chao Hsing Energy Co., Ltd. － Solargo Tech Co., Ltd. － Other related party 5,060 Total $ 5,060 Other receivables Sel Tech Co., Ltd. $ 17,917	FY2021
	$ 99,160 －
	$ 99,160
	December 31, 2021
	$ 5,540 1,953
	$ 7,493
	December 31, 2021
	$ 82,298 41,073 49,063 －
	$ 172,434
	$ 12,699

49

(VI) Accounts Payable to Related Parties

Notes payable Other related party Accounts payable Sel Tech Co., Ltd. Other related party Total Other payables Sel Tech Co., Ltd. Other related party Total Prepayment for Equipment Sel Tech Co., Ltd.	December31,2022 $ 104 $ 19,554 827 $ 20,381 $ 19,393 38 $ 19,431 December 31, 2022 $ 686,494	December31,2021
		$ －
		$ 103,852 －
		$ 103,852
		$ 95,274 －
		$ 95,274
		December 31, 2021
		$ 412,430

(VII) Prepayment for Equipment

The total purchase price of NT$2,392,207 thousand and NT$2,404,393 respectively as of December 31, 2022 and 2021 was for the purchase of solar power equipment and installation, which will be paid according to the progress of the project. Prices and payment terms are based on individual agreements between the parties for each project.

The amount transferred to property, plant and equipment for the period was NT$85,751 thousand.

(VIII) Lease Agreements

Lease Agreements
Right-of-use assets Other related party Lease liabilities - current Other related party Lease liabilities - non-current Other related party Interest expense Other related party	December 31, 2022 $ 6,192 $ 603 $ 3,884 $ 76	December 31, 2021
		$ 6,192
		$ 594
		$ 4,487
		$ 85

The Company leases office space from a related party, and the terms of the transaction are monthly lease payments.

(IX) Remuneration for senior management

Short-term employee benefits Postemployment benefits Total	FY2022 $ 9,142 189 $ 9,331	FY2021
		$ 4,009 191
		$ 4,200

The remuneration of directors and other key managerial officers is determined by the Remuneration Committee based on individual performance and market trends.

50

VIII. Assets Pledged as Collateral

The following assets have been provided as collateral for performance bonds and financing facilities:

financing facilities:
Financial assets measured at amortized cost - non-current (reserve account) Financial assets measured at amortized cost - non-current (pledged time deposits) Property, plant and equipment Total	December31,2022 $ 23,105 80,711 612,207 $ 716,023	December31,2021
		$ 35,894 85,530 534,100
		$ 655,524

• IX. Significant Contingent Liabilities and Unrecognized Contractual Commitments

In addition to those described in other notes, the Consolidated Company's material commitments and contingencies as of the balance sheet date are as follows:

• (I) The details of the Consolidated Company's guaranteed notes payable and bank guarantee letters are as follows:

uarantee letters are as follows:
Performance guarantee Guarantee notes for construction projects Total	December31,2022 $ 87,009 19,915 $ 106,924	December31,2021
		$ 143,840 19,915
		$ 163,755

• (II) The Consolidated Company and Aircom Pacific Inc. jointly developed an in-flight connection system for use in the passenger cabin of an aircraft for a total contract price of NT$28,750 thousand (US$909,000), of which NT$23,918 thousand (US$762,000) had been paid as of December 31, 2021. The Company has no plan to continue the operation of the business, and no manpower is currently committed to the venture; therefore, a total impairment loss of NT$23,918 thousand was recorded in 2015 for the prepaid equipment.

• (III) As for the wind power projects contracted by the Group for Taiwan Power Company in its Taichung Power Plant and Taichung Port area. Many factors that were beyond the control of the Group, such as delayed provision of land, frequent change of the wind turbine sites, and changes in design and construction methods on the side of Taipower as well as the bankruptcy of a subcontractor, the Dutch wind generator supplier, typhoons and severe weather, occurred after the commencement of the works and resulted in a significant increase of the required construction period for the project. For this, the Group asked for extension of the construction period according to the contract and, thus, run into contractual disputes with Taipower. The Chinese Construction Industry Arbitration Association made the arbitral award (Gong-Zhong-Xie-(Jing)-Zi No. 019, 2008) on January 19, 2010 with the text described below:

• Taipower shall extend the construction period for each wind turbine (#1, #2, #3 and #4 turbines) of Taichung Power Plant by 290 calendar days.

• Taipower shall extend the work period of 563 calendar days for each wind turbine (#1-#4) of the first group of wind turbines in the Taichung Harbor Area; 756 calendar days for each wind turbine (#5-#8) of the second group; 773 calendar days for each wind turbine (#9-#12) of the third group; 663 calendar days for each wind turbine (#13-#18) of the fourth group.

• Taipower shall calculate the completion date of the sub-projects of Taichung Power Plant and Taichung Harbor Area by adding 120 calendar days to the last date of completion of the commercial transfer of each site (#3 wind turbine of

51

Taichung Power Plant; #11 wind turbine of Taichung Port Area) as the last completion date of the site.

1. Taipower shall pay the Consolidated Company NT$13,740 thousand and interest at 5% per annum from September 28, 2007 to the date of settlement.

Taipower filed an action against the arbitral award and requested for its revocation. For this, Taiwan Taipei District Court made a decision to dismiss the action (ZhongSu-Zi No. 11, 2010) and Taipower filed an appeal against the decision. On May 31, 2011, the high court delivered its decision (Chong-Shang-Zi No. 501, 2010) to reserve the dismissal of Taipower’s action and the determination on the litigation expenses as declared in the original judgment. As for the text of the arbitral award (Gong-Zhong-Xie-(Jing)-Zi No. 019, 2008) made by the Chinese Construction Industry Arbitration Association, the decision of the high court found that Point (3) exceeded the scope of the arbitration agreement and should be revoked, and the appeal should be dismissed with regard to Points (1), (2) and (4). The two parties had negotiated on the settlement amount, but no consensus could be reached. As a result, Taipower has still not paid the Consolidated Company the amount due.

The Consolidated Company filed a lawsuit with the Taipei District Court on September 5, 2013, requesting Taipower to pay the Company NT$401,631 thousand and on August 25, 2016, the Taipei District Court ruled (2013 Jian-Zi No. 274) that Taipower should pay the Company NT$309,690 thousand, plus interest at 5% per annum from April 14, 2012 to the date of full settlement. Taipower appealed against the judgment and filed an appeal. On May 29, 2020, the Taiwan High Court ruled in (2016 Jian-Shang-Zi No.74) that Taipower should pay the Consolidated Company NT$301,955 thousand, including NT$250,070 thousand from April 14, 2012, and the remaining NT$51,885 thousand with interest at 5% per annum from the day after the judgment was finalized until the date of settlement. Based on the above judgement, the Company filed an appeal with the Supreme Court in which Taipower was required to pay the Company NT$16,045 thousand and interest at 5% per annum from April 14, 2012 to the date of settlement. Taipower subsequently filed an appeal to the Supreme Court on June 29, 2020.

In addition, in February 2015, the Consolidated Company obtained an execution decree from the Taipei District Court of Taiwan in accordance with the abovementioned arbitration judgment on Item 4 seeking NT$13,740 thousand in outstanding payments due. Taipower filed a debtor's dispute lawsuit seeking a stay of execution. On December 9, 2016, the Taipei District Court ruled against Taipower (2015 Zhong-Shu-Zi No.195). Taipower has filed an appeal, which is currently pending before the Taiwan High Court, and the verdict has not yet been determined.

• (IV) The Group placed an order of 54 blades to Umoe (a Dutch company) on June 22, 2005 and authorized it to deal with their transport. Umoe (a Dutch company) authorized another company for this transport matter. A batch of the blades was affected by severe weather during the transport and 15 blades were damaged as a result. Umoe (a Dutch company) found that the procurement agreement was entered into based on the FOB conditions and, thus, asked the Group to reimburse the freight paid on behalf of the Group. On August 16, 2010, the Group received a notice from Taiwan Banqiao District Court about the suit at Oslo District Court, Norway. The JuridiskByra law firm in Norway was authorized for the suit. Oslo District Court made a decision against the Group on April 11, 2011 and required that the Group should pay a compensation of EUR 222 thousand (ca. NT$7,359 thousand) and a sum of legal expenses of NOK 404 thousand (ca. NT$1,258 thousand) with delay interest. As there is no mutual recognition of judicial decisions based on treaties or agreements between Taiwan and Norway, the Company has not received any notice from the court to enforce the above compensation as of December 31, 2022.

52

• (V) As of December 31, 2022 and 2021, the Consolidated Company had entered into contracts for solar power generation equipment, and the total amount due, less the amount paid, was NT$1,885,091 thousand and NT$2,001,151, respectively.

• X. Catastrophic Losses: None.

XI. Significant Post-Term Events: None.

• XII. Other Matters: None.

XIII. Notes for Disclosures

• (I) Information on Material Transactions:

• Loan of funds to others: None.

• Endorsement and guarantees for others: see Schedule 1.

• Marketable securities held at the end of the period (excluding investments in subsidiaries, affiliates and joint ventures): see Schedule 2.

• Cumulative purchases or sales of marketable securities amounting to at least NT$300 million or 20% of the paid-in capital: None.

• Acquisition of real estate amounting to at least NT$300 million or 20% of the paid-in capital: None.

• Disposal of real estate amounting to at least NT$300 million or 20% of the paidin capital: None.

• Purchase from or sale to related parties amounting to at least NT$100 million or 20% of the paid-in capital: see Schedule 3.

• Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital: None.

• Derivative transactions: None.

• Other: Business relationships and material transactions between parents and subsidiaries: see Schedule 5.

• (II) Information on investment in other businesses: see Schedule 4.

• (III) Information on investment in Mainland China: None.

• (IV) Information on major shareholders: Name, amount and percentage of shares held by shareholders with a 5% or more ownership: see Schedule 5.

XIV Department Information

The Company and its subsidiaries assess the performance of the operating segments based on the profit or loss of each operating segment. Information on segment assets and liabilities of the Consolidated Company is not provided to key management for reference or decision making purposes, therefore, disclosure of segment assets and liabilities is not required.

Energy Business Group - Installation of wind power and solar power projects.

Electrical Engineering Group - Design, manufacture, installation and sale of power distribution panels.

53

(I) Segment Revenue and Operating Results

The revenue and operating results of the Consolidated Company's continuing business units are analyzed by reportable segments as follows:

Segment operating revenue Segment operating profit or loss Interest income Other revenue Other profits and losses Share of profit or loss of subsidiaries recognized under the equity method Loss from expected credit impairment Financial cost Pre-tax net profit in current period Segment operating revenue Segment operating profit or loss Interest income Other revenue Other profits and losses Share of profit or loss of subsidiaries recognized under the equity method Loss from expected credit impairment Financial cost Pre-tax net profit in current period		January 1 to December 31, 2022	January 1 to December 31, 2022	January 1 to December 31, 2022
	Energy Business Group	Electrical Engineering Business Group	Construction Business Group	Others	Total
	$ 158,990	$ 103,616	$ 18,913	$ 1	$ 281,520
	$ 92,454	$ 11,882	$ 2,853	$ (32,197)	$ 74,992 1,237 2,220 (10,855) 1 (259) (11,077)
					$ 56,259
	Energy Business Group	Electrical Engineering Business Group	Construction Business Group	Others	Total
	$ 129,109	$ 193,757	$ －	$ 1,580	$ 324,446
	$ 47,099	$ 87,118	$ －	$ (27,783)	$ 106,434 524 12,449 7,513 － － (10,208)
					$ 116,712

(II) Revenue from major products: Please refer to Note 6(20).

(III) Geographical information: The Consolidated Company has no operating income from foreign countries.

54

(IV) Key Customer Information

The Consolidated Company's revenues from a single customer amounting to 10% or more of the Consolidated Company's total revenues are as follows:

Customer A Customer B Customer C Total	FY2022	FY2022	FY2021	FY2021
	Amount	%	Amount	%
	$ 188,955 28,680 －	67 10 －	$ 136,557 16,669 127,040	42 5 39
	$ 217,635	77	$ 280,266	86

55

Schedule 1

Luxe Green Energy Technology Co., Ltd. and its subsidiaries (Originally: Luxe Electric Co., Ltd)

Endorsement and guarantees for others:

January 1 to December 31, 2022

												Unit: NT$‘000	Unit: NT$‘000
Number (Note 1)	Company name of the guarantor	Target of endorsement and guarantee		Endorsement and guarantee limit for a single company (Note 3)	Maximum endorsement and guarantee balance for the period	Ending balance of endorsement and guarantee	Actual amount	Endorsement and guarantee amount secured by assets	Ratio of cumulative guarantee amount to net worth of the most recent financial statements (%)	Maximum amount of endorsement and guarantee (Note 3)	Endorseme nt and guarantee from parent to subsidiary (Note 4)	Endorseme nt and guarantee from subsidiary to parent company (Note 4)	Endorseme nt and guarantee for Mainland China (Note 4)
		Company name	Relation ship (Note 2)
0	The Company	Sen-Hsin Energy Co., Ltd.	2	$ 830,010	$ 450,000	$ 450,000	$ 337,324	$ －	27.11	$ 1,660,020	Y	N	N
0	The Company	Chin Lai International Development Co., Ltd.	2	$ 830,010	$ 450,000	$ 450,000	$ 116,408	$ －	27.11	$ 1,660,020	Y	N	N

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

(1) The issuer is entered as 0.

(2) The investee companies are numbered in order by company, starting from the Arabic numeral 1.

Note 2: There are two types of relationships between the guarantor and the target of the endorsement, which can be indicated as follows:

(1) Companies with business relationship.

(2) Subsidiaries where the guarantor directly holds more than 50% of the common stock.

Note 3: In accordance with the Company's operating procedures, the total amount of endorsement and guarantee shall not exceed 100% of the Company's latest net financial statements. The individual limits of the Company's external endorsement or guarantee shall not exceed 50% of the Company's net worth, and the same applies to the individual limits of the Company's endorsement and guarantee for subsidiaries directly or indirectly holding 100% of the voting shares.

Note 4: Endorsement and guarantee by a listed parent company to its subsidiary, the endorsement and guarantee by the subsidiary to the listed parent company, and the endorsement and guarantees in Mainland China are required to fill in line item Y.

56

Schedule 2

Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Breakdown of marketable securities held at the end of the period

December 31, 2022

							Unit: NT$‘000	Unit: NT$‘000
Company	Type and Name of Marketable Securities	Relationship between the issuer of the securities and the Company	Accounting Item	End of period				Remark s
				Shares	Total carrying amount	Shareholding ratio (%)	Fair Value
The Company	Shares - Chateau International Development Co., Ltd.	Other related party	Financial assets measured at fair value through profit or loss-current	1,657,000	53,752	1.48	53,752
Le Hua Investment Co., Ltd.	Stock - Concord International Securities Co., Ltd. Shares - Chateau International Development Co., Ltd.	None Other related party	Financial assets measured at fair value through profit or loss - current Financial assets measured at fair value through profit or loss-current	1,098,880 51,000	11,264 1,703	－ －	11,264 1,703
Luxe Solar Energy	Shares - Chateau International Development Co., Ltd.	Other related party	Financial assets measured at fair value through profit or loss-current	60,000	2,004	－	2,004
Wan Chuan Construction Co., Ltd.	Castle Applied Inc.	Other related party	Financial assets at fair value through other profit or loss - current	2,830,000	25,278	9.43	25,278

Note 1: Marketable securities referred to in this table are stocks, bonds, beneficiary certificates and marketable securities derived from the above items that fall within the scope of IAS 9, "Financial Instruments".

57

Schedule 3

Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

• The amount of purchase or sale of goods with related parties reaches at least NT$100 million or 20% of the paid in capital.

January 1 to December 31, 2022

									Unit: NT$‘000 unless otherwise specified Notes and accounts receivable (payable) Notes (Note 2) Balance Percentage of Total Notes and Accounts Receivable (Payable) (Note 4) $ (19,554) (20%) －	Unit: NT$‘000 unless otherwise specified Notes and accounts receivable (payable) Notes (Note 2) Balance Percentage of Total Notes and Accounts Receivable (Payable) (Note 4) $ (19,554) (20%) －	Unit: NT$‘000 unless otherwise specified Notes and accounts receivable (payable) Notes (Note 2) Balance Percentage of Total Notes and Accounts Receivable (Payable) (Note 4) $ (19,554) (20%) －
Company that purchases (sells) goods	Counterparty	Relationship		Transactions			Transactions and reasons for differences from ordinary transactions (Note 1)		Notes and accounts receivable (payable)		Notes (Note 2)
			Purchases (sales)	Amount	Percentage of Purchases (Sales) (Note 4)	Credit Period	Unit Price	Credit period	Balance	Percentage of Total Notes and Accounts Receivable (Payable) (Note 4)
The Company	Sel Tech Co., Ltd.	Other related party	Purchases	$ 157,799	42%	90~120 days	By mutual agreement	By mutual agreement	$ (19,554)	(20%)	－

Note 1: If the terms and conditions of the related party's transaction are different from the normal terms and conditions, the difference and the reasons for the difference should be stated in the unit price and credit period columns.

Note 2: If there is any payment received (paid) in advance, the reason, contract terms, amount and the difference from the general transaction type should be stated in the Remarks column. Note 3: Paid-in capital represents the parent company's paid-in capital. If the issuer's stock has no par value or the par value per share is not NT$10, the transaction amount of 20% of the paid-in capital is calculated based on 10% of the equity attributable to the owners of the parent company on the balance sheet.

Note 4: The ratio is calculated based on the total amount before consolidation elimination.

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Schedule 4

Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Information about the investee company, its location, ......, etc.

January 1 to December 31, 2022

Unit: NT$ ’000/thousand shares

Name of the investment company	Name of investee company	Location	Main business scope	Investment amount	Investment amount	Held at the end of the period	Held at the end of the period	Held at the end of the period	Profit (loss) of the investee for the period	Gain (loss) on investment recognized in the period	Remarks
				End of period	End of last year	Shares	Ratio (%)	Par value
The Company	Le Hua Investment Co., Ltd. Luxe Solar Energy Co., Ltd. Sen-Hsin Energy Co., Ltd. Chin Lai International Development Co., Ltd. Kai Shih Energy Co., Ltd. Joy Ribbon Limited Wan Chuan Construction Co., Ltd.	Taiwan Taiwan Taiwan Taiwan Taiwan Seychelles Taiwan	Reinvestment business Energy Technical Services Energy Technical Services Energy Technical Services Energy Technical Services International Trade in Energy Products Comprehensive Construction Activities	$ 20,000 4,826 660,000 202,320 2,550 － 63,000	$ 40,000 14,826 430,000 202,320 2,550 1,422 －	2,000 500 66,900 18,000 255 － 6,300	100 100 100 100 51 － 52.5	$ 13,803 3,537 692,680 222,149 3,250 － 64,364	$ (8,200) (26) 24,830 16,310 1,535 (1,650) 2,969	$ (8,200) (26) 24,830 14,149 783 (842) 1,559	(Note 1) (Note 2)

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Schedule 4-1

Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Information about the investee company, its location, ......, etc.

January 1 to December 31, 2022

Unit: NT$ ’000/thousand shares

Name of the investment company	Name of investee company	Location	Main business scope	Investment amount	Investment amount	Held at the end oft	Held at the end oft	he period	Income (loss) of the investee for the period	Gain (loss) on investment recognized in the period	Notes
				End of period	End of last year	Shares	Ratio (%)	Par value
Chin Lai International Development Co., Ltd.	Qun Li Energy Co., Ltd.	Taiwan	Energy Technical Services	32,899	32,899	2,900	100	30,466	707	707
Wan Chuan Construction Co.,Ltd.	Park Ave Coworking Space Co.,Ltd.	Taiwan	Indoor Decoration	2,250	2,250	225	22.5	1,415	6	1

Note 1: The investment gain or loss recognized in the current period includes a gain of NT$16,310 thousand less amortization of operating rights of NT$2,161 thousand. Note 2: On May 10, 2022, the Company’s equity interest in Joy Ribbon Limited was disposed of.

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Schedule 5

Luxe Green Energy Technology Co., Ltd. and its subsidiaries

(Originally: Luxe Electric Co., Ltd)

Business relationships and material transactions between parent and subsidiary

January 1 to December 31, 2022

							Unit: NT$‘000
Number (Note 1)	Name of the transactional party	Counterparty	Relationship with the transactional party (Note 2)		Transactions
				Accounting item	Amount (Note 3)	Transactional terms and conditions	Percentage of consolidated total revenue or total assets (%)
1	Kai Shih Energy Co., Ltd.	The Company	2	Sales revenue Accounts receivable	$ 432 26	(Note 3) (Note 3)	－ －
1	Kai Shih Energy Co., Ltd.	Sen-Hsin Energy Co., Ltd.	3	Sales revenue Accounts receivable	1,390 89	(Note 3) (Note 3)	－ －
1	Kai Shih Energy Co., Ltd.	Chin Lai International Development Co., Ltd.	3	Sales revenue Accounts receivable	2,340 139	(Note 3) (Note 3)	1 －
1	Kai Shih Energy Co., Ltd.	Qun Li Energy Co., Ltd.	3	Sales revenue Accounts receivable	218 13	(Note 3) (Note 3)	－ －

Note 1: The description of the numbering column is as follows: (1) The issuer is entered as 0.

(2) The investee companies are numbered in order by company, starting from the Arabic numeral 1.

Note 2: There are three types of relationship with the transactional party, and the types are indicated as follows:

1. Parent company to subsidiary.

2. Subsidiary to parent company.

3. Subsidiary to subsidiary company.

Note 3: Eliminated in the preparation of the consolidated financial statements.

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Schedule 6

Luxe Green Energy Technology Co., Ltd. and its subsidiaries (Originally: Luxe Electric Co., Ltd)

Name of Major Shareholders

December 31, 2022

Name of major shareholders	Shareholdings	Shareholdings
	Shares held	Shareholding ratio (％)
Quintain Steel Co., Ltd.	14,603,953	10.03
ConcordInternationalSecurities Co.,Ltd.	14,323,009	9.84
Hsia Ti Investment Co., Ltd.	10,395,959	7.14
PaoLi TouInvestment Co.,Ltd.	8,301,575	5.70
Asahi Enterprises Corp.	8,169,450	5.61

• Note 1: The information on major shareholders in this table is based on the last business day of the quarter in which the shareholders hold 5% or more of the Company's common and preferred shares in dematerialized format. The number of shares recorded in the consolidated financial statements and the actual number of shares in dematerialized format may differ depending on the basis of calculation.

• Note 2: The above information is disclosed by the trustee's opening of a trust account with individual subaccounts of the trustee if the shareholders have entrusted their shares to the trust. As for the shareholder's shareholding of more than 10% of the shares of insiders reported under the Securities and Exchange Act, the shareholding includes the shareholding of the shareholder plus the shareholding of the shareholder who entrusted shares held to the trust and has the right to decide the use of the trust property.

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