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MHC Interim / Quarterly Report 2021

Nov 12, 2021

52372_rns_2021-11-12_d6ef9be0-28a7-4c47-a72e-b2992456a73e.pdf

Interim / Quarterly Report

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MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’ REVIEW REPORT SEPTEMBER 30, 2021 AND 2020

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

~1~

INDEPENDENT AUDITORS’ REVIEW REPORT

PWCR21000140

To the Board of Directors and Shareholders of MiTAC Holdings Corporation

Introduction

We have reviewed the accompanying consolidated balance sheets of MiTAC Holdings Corporation and its subsidiaries (the “Group”) as at September 30, 2021 and 2020, and the related consolidated statements of comprehensive income for the three months and nine months then ended, as well as the consolidated statements of changes in equity and of cash flows for the nine months then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” as endorsed by the Financial Supervisory Commission. Our responsibility is to express a conclusion on these consolidated financial statements based on our reviews.

Scope of review

Except as explained in the following paragraph, we conducted our reviews in accordance with the Statement of Auditing Standards No. 65, “Review of Financial Information Performed by the Independent Auditor of the Entity” in the Republic of China. A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

~2~

Basis for qualified conclusion

The financial statements of certain insignificant consolidated subsidiaries and investments accounted for using equity method during the same period were not reviewed by independent auditors. Total assets of these subsidiaries and the balances of these investments accounted for using equity method amounted to NT$11,844,252 thousand and NT$16,981,662 thousand, constituting 17% and 31% of the consolidated total assets as at September 30, 2021 and 2020, respectively, total liabilities amounted to NT$2,302,408 thousand and NT$1,694,842 thousand, constituting 11% and 12% of the consolidated total liabilities as at September 30, 2021 and 2020, respectively, and the total comprehensive income (loss) and share of profit or loss and other comprehensive income of associates and joint ventures accounted for using equity method amounted to NT($379,560) thousand, NT$852,673 thousand, NT$960,100 and NT$953,043 thousand, constituting (8%), 52%, 11% and 42% of the consolidated total comprehensive income (loss) for the three months and nine months then ended, respectively.

Qualified conclusion

Except for the adjustments to the consolidated financial statements, if any, as might have been determined to be necessary had the financial statements of the insignificant subsidiaries and equity method investees been reviewed by independent auditors as described in the Basis for qualified conclusion section, based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as at September 30, 2021 and 2020, and of its consolidated financial performance for the three months and nine months then ended and its consolidated cash flows for the nine months then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” as endorsed by the Financial Supervisory Commission.

~3~

Emphasis of matter

We draw attention to Note 6(7) to the consolidated financial statements, which describes that during the third quarter of 2021, the Group’s ownership in the associate, TD Synnex Corp., was decreased and the Group lost significant influence over it. As a result, the Group recognised gains on disposal of investments amounting to NT$12,820,034 thousand. Our conclusion is not modified in respect of this matter.

Liu, Chien-Yu Cheng, Ya-Huei

For and on behalf of PricewaterhouseCoopers, Taiwan November 11, 2021

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and independent auditors' review report are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

~4~

MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2021, DECEMBER 31, 2020 AND SEPTEMBER 30, 2020

(Expressed in thousands of New Taiwan dollars) (The balance sheets as of September 30, 2021 and 2020 are reviewed, not audited)

Assets Notes September 30, 2021
AMOUNT
%
$
6,633,952
9
4,287
-
1,574,567
2
312,974
-
46,988
-
5,438,331
8
3,163
-
75,751
-
26,178
-
10,727,955
15
455,469
1
-
-
17,464
-
25,317,079
35
22,580,575
32
43,730
-
13,363,820
19
7,515,910
11
320,180
-
1,253,851
2
78,262
-
523,086
1
78,278
-
45,757,692
65
$
71,074,771
100		 December 31, 2020
AMOUNT
%
$
5,805,297
10
6,107
-
1,232,843
2
8,754
-
31,689
-
4,982,050
9
215,960
-
60,168
-
2,136
-
9,123,004
16
406,538
1
90,133
-
16,830
-
21,981,509
38
6,065,749
11
35,253
-
19,071,689
33
7,753,087
14
359,874
1
1,229,431
2
75,904
-
504,324
1
94,915
-
35,190,226
62
$
57,171,735
100		 September 30, 2020 September 30, 2020
AMOUNT
$
6,633,952
4,287
1,574,567
312,974
46,988
5,438,331
3,163
75,751
26,178
10,727,955
455,469
-
17,464
25,317,079
22,580,575
43,730
13,363,820
7,515,910
320,180
1,253,851
78,262
523,086
78,278
45,757,692
$
71,074,771		 AMOUNT
$
5,805,297
6,107
1,232,843
8,754
31,689
4,982,050
215,960
60,168
2,136
9,123,004
406,538
90,133
16,830
21,981,509
6,065,749
35,253
19,071,689
7,753,087
359,874
1,229,431
75,904
504,324
94,915
35,190,226
$
57,171,735		 AMOUNT
$
4,349,646
43,405
1,046,687
141,026
84,210
6,135,104
350,311
55,482
16,995
8,708,373
622,439
33,250
21,449
21,608,377
5,464,992
35,166
18,292,732
7,836,544
344,670
1,229,151
80,939
485,680
100,129
33,870,003
$
55,478,380		 %
Current assets
1100
Cash and cash equivalents
1110
Financial assets at fair value
through profit or loss - current
1120
Financial assets at fair value
through other comprehensive
income - current
1136
Financial assets at amortised
cost - current
1150
Notes receivable - net
1170
Accounts receivable - net
1180
Accounts receivable - related
parties - net
1200
Other receivables
1220
Current income tax assets
130X
Inventories
1410
Prepayments
1460
Non-current assets held for sale
- net
1470
Other current assets
11XX
Total current assets
Non-current assets
1517
Financial assets at fair value
through other comprehensive
income - non-current
1535
Non-current financial assets at
amortised cost
1550
Investments accounted for
using equity method
1600
Property, plant and equipment -
net
1755
Right-of-use assets
1760
Investment property - net
1780
Intangible assets
1840
Deferred income tax assets
1900
Other non-current assets
15XX
Total non-current assets
1XXX
Total assets		 6(1)
6(2)
6(3)
6(4) and 8
6(5) and 12(2)
6(5), 7 and
12(2)
7
6(6)
6(13)
6(16)
6(3)
6(4) and 8
6(7)
6(8)
6(9) and 7
6(11)
6(12)		 8
-
2
-
-
11
1
-
-
16
1
-
-
39
10
-
33
14
1
2
-
1
-
61
100

(Continued)

~5~

MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2021, DECEMBER 31, 2020 AND SEPTEMBER 30, 2020

(Expressed in thousands of New Taiwan dollars) (The balance sheets as of September 30, 2021 and 2020 are reviewed, not audited)

September 30, 2021 September 30, 2021 December 31, 2020 December 31, 2020 September 30, 2020 September 30, 2020
Liabilities andEquity Notes AMOUNT % AMOUNT % AMOUNT %
Current liabilities
2100 Short-term borrowings 6(14) $ 1,834,724 3 $ 1,443,851 3 $ 3,056,123 6
2120 Financial liabilities at fair value
6(15)
through profit or loss - current 1,850 - 11,691 - 9,274 -
2130 Contract liabilities - current 6(23) 374,993 1 127,866 - 115,734 -
2170 Accounts payable 6,681,720 9 6,662,560 12 5,079,634 9
2180 Accounts payable - related 7
parties 108,803 - 20,222 - 43,789 -
2200 Other payables 7 3,529,052 5 3,366,781 6 3,410,950 6
2230 Current income tax liabilities 426,920 1 440,247 1 449,007 1
2250 Provisions - current 6(18) 110,339 - 132,169 - 145,820 -
2280 Lease liabilities - current 7 37,618 - 36,760 - 24,205 -
2300 Other current liabilities 6(16) 408,040 1 279,550 - 240,181 -
21XX Total current Liabilities 13,514,059 20 12,521,697 22 12,574,717 22
Non-current liabilities
2540 Long-term borrowings 6(16) 704,138 1 863,366 2 863,561 2
2550 Provisions - non-current 6(18) 137,370 - 123,905 - 110,030 -
2570 Deferred income tax liabilities 6,645,751 9 378,872 1 378,727 1
2580 Lease liabilities - non-current 7 162,005 - 194,448 - 134,960 -
2600 Other non-current liabilities 6(7) 388,722 - 327,952 1 307,758 1
25XX Total non-current
liabilities 8,037,986 10 1,888,543 4 1,795,036 4
2XXX Total liabilities 21,552,045 30 14,410,240 26 14,369,753 26
Share capital 6(19)
3110 Common shares 12,065,568 17 12,065,568 21 12,065,568 22
Capital surplus 6(20)
3200 Capital surplus 22,589,371 32 23,582,411 41 23,590,900 43
Retained earnings 6(21)
3310 Legal reserve 1,744,713 2 1,451,388 3 1,451,388 2
3350 Unappropriated retained
earnings 14,031,360 20 4,110,220 7 3,200,572 6
Other equity interest 6(22)
3400 Other equity interest ( 715,274 ) ( 1) 1,743,283 3 990,866 2
3500 Treasury stocks 6(19) ( 239,876 ) - ( 239,876) ( 1) ( 239,876 ) ( 1)
31XX Equity attributable to
owners of the parent 49,475,862 70 42,712,994 74 41,059,418 74
36XX Non-controlling interests 46,864 - 48,501 - 49,209 -
3XXX Total equity 49,522,726 70 42,761,495 74 41,108,627 74
Significant Contingent 9(1)(2)
Liabilities And Unrecognised
Contract Commitments
Significant Events After the 11
Balance Sheet Date
3X2X Total liabilities and equity $ 71,074,771 100 $ 57,171,735 100 $ 55,478,380 100

The accompanying notes are an integral part of these consolidated financial statements.

~6~

MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except earnings per share) (Reviewed, not audited)

Items Notes
 Three months ended September 30 Three months ended September 30
2021 2020
4000
Operating revenue
5000
Operating costs
5900
Gross profit
Operating expenses
6100
Selling expenses
6200
General and administrative expenses
6300
Research and development expenses
6000
Total operating expenses
6900
Operating profit (loss)
Non-operating income and expenses
7100
Interest income
7010
Other income
7020
Other gains and losses
7050
Finance costs
7060
Share of profit of associates and joint ventures
accounted for using equity method
7000
Total non-operating income and expenses
7900
Profit before income tax
7950
Income tax expense
8200
Profit for the period

(Continued)

~7~

MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except earnings per share) (Reviewed, not audited)

Items Notes Three months ended September 30 Three months ended September 30
2021 2020
Other comprehensive income (loss) - net
Components of other comprehensive income (loss) that
will not be reclassified to profit or loss
8316
Unrealised gains from investments in equity instruments
measured at fair value through other comprehensive
income
8320
Share of other comprehensive income (loss) of
associates and joint ventures accounted for using equity
method, components of other comprehensive income
that will not be reclassified to profit or loss
8310
Components of other comprehensive income that will
not be reclassified to profit or loss
Components of other comprehensive income (loss) that
will be reclassified to profit or loss
8361
Exchange differences on translation of foreign financial
statements
8370
Share of other comprehensive income (loss) of
associates and joint ventures accounted for using equity
method, components of other comprehensive income
that will be reclassified to profit or loss
8360
Components of other comprehensive loss that will be
reclassified to profit or loss
8300
Other comprehensive income (loss) for the period
8500
Total comprehensive income for the period
Profit (loss), attributable to:
8610
Owners of parent
8620
Non-controlling interests
Comprehensive income (loss) attributable to:
8710
Owners of parent
8720
Non-controlling interests
9750
Basic earnings per share
9850
Diluted earnings per share

The accompanying notes are an integral part of these consolidated financial statements.

~8~

MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

(Reviewed, not audited)

Nine months ended September 30, 2020
Balance at January 1, 2020
Profit (loss) for 2020
Other comprehensive income (loss) for
2020
Total comprehensive income (loss)
Distribution of 2019 earnings
Legal reserve
Special reserve
Cash dividends
Stock dividends
Change of associates accounted for using
equity method
Disposal of Company's share by
subsidiaries recognised as treasury share
transactions
Subsidiaries received cash dividends paid
by the parent company
Proceeds from disposal of investments
accounted for using equity method
Changes in non-controlling interests
Proceeds from disposal of equity
instruments measured at fair value
through other comprehensive income
Capital surplus - dividends unclaimed by
the shareholders
Balance at September 30, 2020
Nine months ended September 30, 2021
Balance at January 1, 2021
Profit (loss) for the period
Other comprehensive loss for the period
Total comprehensive income (loss)
Distribution of 2020 earnings
Legal reserve
Cash dividends
Change of associates accounted for using
equity method
Subsidiaries received cash dividends paid
by the parent company
Proceeds from disposal of investments
accounted for using equity method
Capital surplus - dividends unclaimed by
the shareholders
Balance at September 30, 2021		 Notes Equityat tri butable to owners of t he parent parent parent Non-controlling
interests		 Total equity
Capitalsurplus Capital
surplus,additional
paid-in capital		 Retained earnings Otherequityinterest Treasurystocks Total
Share capital-
common shares		 Legal reserve Special reserve Unappropriated
retained earnings
d		 Financial statements
translation
ifferences of foreign
operations		 Unrealised gains
(losses) from
financial assets
measured at fair
value through other
comprehensive
income
6(22)
6(21)

6(20)(22)
6(19)(20)

6(22)
6(32)
6(3)
6(20)
6(22)
6(21)

6(20)(22)

6(20)
6(22)
6(20)		 $
10,772,829
-
-
-
-
-
-
1,292,739
-
-
-
-
-
-
-
$
12,065,568
$
12,065,568
-
-
-
-
-
-
-
-
-
$
12,065,568		 $
23,400,002
-
-
-
-
-
-
-
96,319
83,417
10,784
-
-
-
378
$
23,590,900
$
23,582,411
-
-
-
-
-
11,227
11,379
(
1,016,022 )
376
$
22,589,371		 $
1,167,412
-
-
-
283,976
-
-
-
-
-
-
-
-
-
-
$
1,451,388
$
1,451,388
-
-
-
293,325
-
-
-
-
-
$
1,744,713		 $
12,265
-
-
-
-
(
12,265 )
-
-
-
-
-
-
-
-
-
$
-
$
-
-
-
-
-
-
-
-
-
-
$
-		 $
3,818,704
2,007,700
-
2,007,700
(
283,976 )
12,265
(
1,077,283 )
(
1,292,739 )
23,959
-
-
(
86 )
-
(
7,972 )
-
$
3,200,572
$
4,110,220
11,422,247
-
11,422,247
(
293,325 )
(
1,206,557 )
4,624
-
(
5,849 )
-
$
14,031,360		 ($
1,081,728 )
-
(
658,775 )
(
658,775 )
-
-
-
-
-
-
-
-
-
-
-
($
1,740,503 )
($
1,803,450 )
-
(
444,566 )
(
444,566 )
-
-
-
-
-
-
($
2,248,016 )








$
1,753,427
-
993,843
993,843
-
-
-
-
(
23,959 )
-
-
86
-
7,972
-
$
2,731,369
$
3,546,733
-
(
2,010,209 )
(
2,010,209 )
-
-
(
9,631 )
-
5,849
-
$
1,532,742		 ($
353,087 )
-
-
-
-
-
-
-
-
113,211
-
-
-
-
-
($
239,876 )
($
239,876 )
-
-
-
-
-
-
-
-
-
($
239,876 )		 $
39,489,824
2,007,700
335,068
2,342,768
-
-
(
1,077,283 )
-
96,319
196,628
10,784
-
-
-
378
$
41,059,418
$
42,712,994
11,422,247
(
2,454,775 )
8,967,472
-
(
1,206,557 )
6,220
11,379
(
1,016,022 )
376
$
49,475,862		 $
64,922
(
67,296 )
(
774 )
(
68,070 )
-
-
(
4,463 )
-
-
-
-
-
56,820
-
-
$
49,209
$
48,501
(
676 )
(
130 )
(
806 )
-
(
831 )
-
-
-
-
$
46,864






$
39,554,746
1,940,404
334,294
2,274,698
-
-
(
1,081,746 )
-
96,319
196,628
10,784
-
56,820
-
378
$
41,108,627
$
42,761,495
11,421,571
(
2,454,905 )
8,966,666
-
(
1,207,388 )
6,220
11,379
(
1,016,022 )
376
$
49,522,726

The accompanying notes are an integral part of these consolidated financial statements.

~9~

MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

(Received, not audited)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax
Adjustments
Adjustments to reconcile profit (loss)
Depreciation

Amortization

Expected credit loss

Gain of financial assets/liabilities at fair value through
profit or loss

Interest expense

Interest income

Dividend income

Share of profit of associates and joint ventures
accounted for using equity method

Gain on disposal of property, plant and equipment

Gain on disposal of non-current assets classified as
held for sale

(Gain) loss on disposal of investments

Loss on inventory market value decline

Changes in operating assets and liabilities
Changes in operating assets
Notes receivable
Accounts receivable
Other receivables
Inventories
Prepayments
Other current assets
Changes in operating liabilities
Contract liabilities
Accounts payable
Other payables
Provisions for liabilities
Other current liabilities
Accrued pension liabilities
Other non-current liabilities
Cash outflow generated from operations
Receipt of interest
Cash dividend received
Payment of interest
Payment of income tax
Net cash flows from (used in) operating activities		 Nine months ended September 30
Notes
2021
2020
$
18,060,757 $
2,056,622
6(28)
707,988
674,441
6(28)
71,288
66,826
12(2)
525
15,268
6(26)
(
7,957 ) (
20,879 )
6(27)
18,600
37,589
6(24)
(
38,896 ) (
33,662 )
6(25)
(
296,240 ) (
212,469 )
6(7)
(
2,663,448 ) (
1,531,304 )
6(26)
(
2,003 ) (
1,185 )
6(26)
(
1,044,185 )
-
6(26)
(
13,812,619 )
4,817
6(6)
11,036
136,480
(
15,841 )
8,541
(
307,571 ) (
234,577 )
(
10,862 )
69,389
(
1,695,750 ) (
1,213,446 )
(
43,814 ) (
185,201 )
(
1,376 )
8,433
250,011 (
159,234 )
141,219 (
690,421 )
191,264
209,613
(
7,251 )
3,700
(
28,790 )
16,954
(
5,124 ) (
11,674 )
(
97 )
516
(
529,136 ) (
984,863 )
37,882
37,610
1,085,621
811,508
(
18,157 ) (
42,714 )
(
406,807 ) (
63,100 )
169,403 (
241,559 )

(Continued)

~10~

MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

(Received, not audited)

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of financial assets at fair value through other
comprehensive income
Proceeds from disposal of financial assets at fair value
through other comprehensive income
Proceeds from capital reduction of financial assets at fair
value through other comprehensive income
(Increase) decrease in financial assets at amortised cost
Acquisition of financial assets at fair value through profit
or loss
Proceeds from disposal of financial assets at fair value
through profit or loss
Acquisition of investments accounted for using equity
method

Proceeds from disposal of investments accounted for
using equity method

Decrease in net cash from disposal of subsidiaries

Proceeds from disposal of non-current assets classified as
held for sale

Acquisition of property, plant and equipment

Proceeds from disposal of property, plant and equipment
Decrease (increase) in refundable deposits
Increase in intangible assets

Increase in investment property

Increase in other non-current assets
Net cash flows from (used in) investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term borrowings

Proceeds from long-term borrowings

Increase (decrease) in guarantee deposits

Repayment of principal portion of lease liabilities

Cash dividends paid

Proceeds from disposal of treasury shares

Investments increased by non-controlling interest

Capital surplus - expired unclaimed dividends

Net cash flows used in financing activities
Effects of changes in exchange rates
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period
 Nine months ended September 30
Notes
2021
2020
($
142,511 ) ($
95,957 )
-
12,303
22,112
-
(
315,347 )
358,431
- (
11,249 )
-
89,343
6(7)
- (
132,394 )
6(7)
1,469,173
-
6(33)
- (
78,615 )
6(13)
1,133,507
-
6(8)
(
529,524 ) (
712,455 )
2,983
2,381
2,507 (
7,906 )
6(12)
(
73,682 ) (
59,171 )
6(11)
(
12,557 )
-
- (
13,458 )
1,556,661 (
648,747 )
6(34)
392,990 (
738,644 )
6(34)
2,268
72,000
6(34)
5,701 (
3,336 )
6(34)
(
29,542 ) (
41,360 )
6(33)
(
1,196,009 ) (
1,070,962 )
6(19)
-
196,628
6(32)
-
90,150
6(20)
376
378
(
824,216 ) (
1,495,146 )
(
73,193 )
70,532
828,655 (
2,314,920 )
6(1)
5,805,297
6,664,566
6(1)
$
6,633,952 $
4,349,646

The accompanying notes are an integral part of these consolidated financial statements.

~11~

MiTAC HOLDINGS CORPORATION AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

(Reviewed, not audited)

1. HISTORY AND ORGANISATION

  • (1) MiTAC Holdings Corporation (the “Company”) was established by MiTAC International Corp. (“MiTAC International”) through a share conversion on September 12, 2013, and on the same date, the Competent Authority has approved for the Company’s shares to be listed on the Taiwan Stock Exchange (TWSE). MiTAC International became the Company’s wholly-owned subsidiary after conversion. The main business of the Company and its subsidiaries (collectively referred herein as the “Group”) is to design, manufacture and sell products related to investments, computers and its peripherals and communications.

  • (2) In order to promote specialization of work for transforming and improving overall competitiveness of the Group, the Board of Directors of its subsidiary, MiTAC International, has resolved to divest its cloud computing products group to the newly established company, MiTAC Computing Technology Corporation ( “MiTAC Computing Technology”), as the consideration for the acquisition of 220,000 thousand newly issued ordinary shares of MiTAC Computing Technology on the spin-off day, September 1, 2014. In addition, in 2017, the Board of Directors of MiTAC International has resolved to divest its mobile communication products group to the newly established company, MiTAC Digital Technology Corporation ( “MiTAC Digital Technology”), as the consideration for the acquisition of 100,000 thousand newly issued ordinary shares of MiTAC Digital Technology on the spin-off day, January 1, 2018. As a result, MiTAC International, MiTAC Computing Technology and MiTAC Digital Technology are the wholly-owned subsidiaries of the Company after the spinoff.

  • THE DATE OF AUTHORISATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORISATION

These consolidated financial statements were reported to the Board of Directors on November 11, 2021.

3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

  • (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

New standards, interpretations and amendments endorsed by FSC effective from 2021 are as follows:

~12~

Effective date by
International Accounting
New Standards,Interpretations and Amendments Standards Board
Amendments to IFRS 4, ‘Extension of the temporary exemption from January 1, 2021
applying IFRS 9’
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘Interest January 1, 2021
Rate Benchmark Reform— Phase 2’
Amendment to IFRS 16, ‘Covid-19-related rent concessions beyond 30 April 1, 2021(Note)
June 2021’
Note：Earlier application from January 1, 2021 is allowed by FSC.

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment. (2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by the Group

New standards, interpretations and amendments endorsed by FSC effective from 2022 are as follows:

New Standards,Interpretations and Amendments Effective date by
International
Accounting
Standards Board
Amendments to IFRS 3, ‘Reference to the conceptual framework’
Amendments to IAS 16, ‘Property, plant and equipment:
proceeds before intended use’
Amendments to IAS 37, ‘Onerous contracts—
cost of fulfilling a contract’
Annual improvements to IFRS Standards 2018–2020		 January 1, 2022
January 1, 2022
January 1, 2022
January 1, 2022

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

(3) IFRSs issued by IASB but not yet endorsed by the FSC

New standards, interpretations and amendments issued by IASB but not yet included in the IFRSs as endorsed by the FSC are as follows:

~13~

Effective date by International Accounting New Standards, Interpretations and Amendments Standards Board Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets To be determined by between an investor and its associate or joint venture’ International Accounting Standards Board IFRS 17, ‘Insurance contracts’ January 1, 2023 Amendments to IFRS 17, 'Insurance contracts' January 1, 2023 Amendments to IAS 1, ‘Classification of liabilities as current or nonJanuary 1, 2023 current’ Amendments to IAS 1, ‘Disclosure of accounting policies’ January 1, 2023 Amendments to IAS 8, ‘Definition of accounting estimates’ January 1, 2023 Amendments to IAS 12, ‘Deferred tax related to assets and liabilities January 1, 2023 arising from a single transaction’

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted are consistent with Note 4 in the consolidated financial statements for the year ended December 31, 2020, except for the compliance statement, basis of preparation, basis of consolidation and additional policies as set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

  • (1) Compliance statement

  • A. The consolidated financial statements of the Group have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Accounting Standard 34, ‘Interim financial reporting’ as endorsed by the FSC.

  • B. The consolidated financial statements should be read together with the consolidated financial statements for the year ended December 31, 2020.

  • (2) Basis of preparation

  • A. Except for the following items, these consolidated financial statements have been prepared under the historical cost convention:

    • (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

    • (b) Financial assets and liabilities at fair value through other comprehensive income.

    • (c) Defined benefit liabilities recognised based on the net amount of pension fund assets and present value of defined benefit obligation.

  • B. The preparation of financial statements in compliance with International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”) requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process

~14~

of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

(3) Basis of consolidation

  • A. Basis for preparation of consolidated financial statements:

Basis for preparation of these consolidated financial statements is the same as that for the preparation of the consolidated financial statements as of and for the year ended December 31, 2020.

B. Subsidiaries included in the consolidated financial statements:

Investor Subsidiary Main activities Ownership (%) Ownership (%) Remarks
September
30,2021		 December
31,2020		 September
30,2020
MiTAC Holdings
Corp.
MiTAC Holdings
Corp.
MiTAC Holdings
Corp.
MiTAC
International Corp.
MiTAC
International Corp.
MiTAC Computing
Technology Corp.
MiTAC Computing
Technology Corp.
MiTAC Digital
Technology Corp.
MiTAC Digital
Technology Corp.
Tsu Fung
Investment Corp.
Silver Star
Developments Ltd.		 MiTAC
International Corp.
MiTAC Computing
Technology Corp.
MiTAC Digital
Technology Corp.
Tsu Fung Investment
Corp.
Silver Star
Developments Ltd.
MiTAC Technology
UK Ltd.
MiTAC Telematics
Technology
Corporation
Access Wisdom
Holdings Ltd.
Mio International Ltd.
MiTAC Digital
Technology Corp.
Pacific China Corp.		 Computer and its peripherals:
design, manufacture and sell
communications products
Computer and its peripherals:
design, manufacture and sell
communications products
Sales and service of electronic
telecommunication,
communication and software, etc
General investments
General investments
General investments
Sales of self-produced products
and related after-sale services
General investments
Sale of communication and
related products
Sales and service of electronic
telecommunication,
communication and software, etc
General investments		 100%
100%
97.17%
100%
100%
100%
100%
100%
100%
0.001%
100%		 100%
100%
97.17%
100%
100%
100%
100%
100%
100%
0.001%
100%		 100%
100%
97.17%
100%
100%
100%
100%
100%
100%
0.001%
100%		 Note 2
Note 2
Note 2
Note 2
Note 2
Note 2
Note 2

~15~

Investor
Pacific China Corp.
Pacific China Corp.
Pacific China Corp.
Pacific China Corp.
Access Wisdom
Holdings Ltd.
MiTAC Technology
UK Ltd.
MiTAC Technology
UK Ltd.
MiTAC Technology
UK Ltd.
MiTAC Europe
Ltd.
MiTAC Europe
Ltd.
Silver Star
Developments Ltd.
Silver Star
Developments Ltd.
Silver Star
Developments Ltd.
Start Well
Technology Ltd
MiTAC Investment
Holding Ltd.
MiTAC Investment
Holding Ltd.		 Subsidiary
Main activities
MiTAC Star Service
Ltd.
General investments
Software Insights Ltd. General investments
Start Well
Technology Ltd.
General investments
Huge Extent Ltd.
General investments
MiTAC Europe Ltd.
Sale of communication products
and related after-sale services
Tyan Computer
Corp. (USA)
Sales of computer peripherals,
hardware/ software and related
products
MiTAC Logistics
Corp.
Sale of computer peripherals,
hardware/software and related
products
MiTAC Information
Systems Corp.
Assembling and sale of
computer peripherals,
hardware/software and related
products
MiTAC Digital
Corp.
Sale of communication products
and related after-sale services
MiTAC Australia
Pty Ltd.
Sale of communication products
and related after-sale services
MiTAC Japan Corp.
Sale of communication
products, computer peripherals,
hardware/software and related
products and related after-sale
services
MiTAC Benelux
N.V.
Sale of communication products
and related after-sale services
MiTAC Pacific
(H.K.) Ltd.
Sale of computer peripherals,
hardware/software and related
products
MiTAC Investment
Holding Ltd.
Investment holdings
MiTAC Computer
(Kunshan) Ltd.
Manufacture of computers,
computer peripherals,
hardware/software and related
products and sale of own-
produced products
MiTAC Technology
(Kunshan) Co., Ltd.
Testing, maintenance and
display of computer components
and related technical advisory
services and after-sale services		 September
30,2021

100%
100%
100%
100%
100%
100%
-
100%
100%
100%
100%
100%
100%
100%
100%
100%		 December
September
31,2020
30,2020
Ownership (%)		 December
September
31,2020
30,2020
Ownership (%)		 Remarks
Note 2
Note 1
Note 2
100%
100%
100%
100%
100%
100%
-
100%
100%
100%
100%
100%
100%
100%
100%
100%		 100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%

~16~

Investor
MiTAC Investment
Holding Ltd.
MiTAC Investment
Holding Ltd.
MiTAC Star
Service Ltd.
MiTAC Computer
(Kunshan) Ltd
Software Insights
Ltd.
Software Insights
Ltd.
Mio International
Ltd.		 Subsidiary
Main activities
MiTAC Logistic
Service (Kunshan)
Ltd.
Agency of freight transport,
export and import trading and
warehousing services.
MiTAC Information
Technology Ltd.
After-sale maintenance, testing
and technical advisory services
of computers, communication
products and consumer
electronic products;
establishment of customer
service centers; customer data
processing, analysis and
integrated services and business
administration services
MiTAC Computer
(Shunde) Corp.
Manufacture of computer frame,
motherboard, interface card,
display, power supply, keyboard,
related metal stamping parts and
plastic parts and maintenance of
motherboard
MiTAC Information
Systems (Kunshan)
Co., Ltd.
Sales and manufacturing of
computer accessories, hardware,
software and related services
MiTAC Research
(Shanghai) Ltd.
Research, development and
manufacture of computer
software, sale of own-produced
products and related technical
advisory services
MiTAC Innovation
(Kunshan) Ltd.
Research and development of
calculator, server, mobile phone,
PDA and GPS, and technical
transfer, technical advisory and
technical services of related
R&D products
Mio Technology
(Suzhou) Ltd.
Sale of communication products
and related after-sale services		 September
30,2021

100%
100%
100%
100%
100%
100%
100%		 December
September
31,2020
30,2020
Ownership (%)		 December
September
31,2020
30,2020
Ownership (%)		 Remarks
Note 2
100%
100%
100%
100%
100%
100%
100%		 100%
100%
100%
100%
100%
100%
100%

Note 1: It completed the liquidation in 2020.

Note 2: The financial statements of the entity as of and for the nine months ended September 30,

2021 and 2020 were reviewed by the independent auditors.

  • C. Subsidiaries not included in the consolidated financial statements: None.

  • D. Adjustments for subsidiaries with different balance sheet dates: None.

  • E. Nature and extent of the restrictions on fund remittance from subsidiaries to the parent company: None.

  • F. Subsidiaries that have non-controlling interests that are material to the Group: None.

~17~

(4) Employee benefits

Pension cost for the interim period is calculated on a year-to-date basis by using the pension cost rate derived from the actuarial valuation at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant curtailments, settlements, or other significant one-off events. Also, the related information is disclosed accordingly.

  • (5) Income taxes

  • A. The interim period income tax expense is recognized based on the estimated average annual effective income tax rate expected for the full financial year applied to the pretax income of the interim period, and the related information is disclosed accordingly.

  • B. If a change in tax rate is enacted or substantively enacted in an interim period, the Group recognises the effect of the change immediately in the interim period in which the change occurs. The effect of the change on items recognised outside profit or loss is recognised in other comprehensive income or equity while the effect of the change on items recognised in profit or loss is recognised in profit or loss.

5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION

UNCERTAINTY

There have been no significant changes as of September 30, 2021. Please refer to Note 5 in the consolidated financial statements for the year ended December 31, 2020.

The Group has considered the economic implications of COVID-19 pandemic on critical accounting estimates, reflected the impact caused by the pandemic and will continue evaluating the impact on its financial position and financial performance.

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

Cash and cash equivalents
Cash:
Cash on hand and revolving
funds
Checking accounts and demand
deposits
Cash equivalents:
Time deposits
Total		 September 30,2021
470
$ 4,511,916
2,121,566
6,633,952
$		 December 31,2020
753
$ 4,145,332
1,659,212
5,805,297
$		 September 30,2020
779
$ 3,039,729
1,309,138
4,349,646
$

  • A. The Group transacts with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote.

  • B. The Group has no cash and cash equivalents pledged to others.

~18~

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

==> picture [497 x 132] intentionally omitted <==

----- Start of picture text -----

Items September 30, 2021 December 31, 2020 September 30, 2020
Current items:
Financial assets mandatorily
measured at fair value
through profit or loss
Derivatives $ - $ - $ -
Valuation adjustment
- Derivatives 4,287 6,107 43,405
Total $ 4,287 $ 6,107 $ 43,405
----- End of picture text -----

  • A. The Group recognised net (loss) gain of ($21,194), $13,358, ($1,821) and $21,551 on financial assets at fair value through profit or loss for the three months and nine months ended September 30, 2021 and 2020, respectively.

  • B. The non-hedging derivative instrument transactions and contract information are as follows：

==> picture [473 x 42] intentionally omitted <==

----- Start of picture text -----

September 30, 2021
Notional Amount Fair Market Value
Financial Instrument Item (in thousands) (in thousands)
----- End of picture text -----

Notional Amount Fair Market Value
Financial Instrument
Item
(in thousands)
(in thousands)
September 30, 2021		 Notional Amount Fair Market Value
Financial Instrument
Item
(in thousands)
(in thousands)
September 30, 2021		 Notional Amount Fair Market Value
Financial Instrument
Item
(in thousands)
(in thousands)
September 30, 2021		 Notional Amount Fair Market Value
Financial Instrument
Item
(in thousands)
(in thousands)
September 30, 2021
MiTAC Digital Technology Corp.
Forward foreign exchange - Sell
Advance booking USD to buy NTD
USD 1,000 NTD 8
Forward foreign exchange - Sell
Advance booking EUR to buy USD
EUR 1,380 NTD 738
Forward foreign exchange - Sell
Advance booking AUD to buy USD
AUD 5,400 NTD 976
MiTAC Computer (KunShan) Co., Ltd.
Forward foreign exchange - Sell
Advance booking USD to buy CNY
USD 4,000 CNY 203
MiTAC Computer (Shunde) Ltd.
Forward foreign exchange - Sell
Advance booking USD to buy CNY
USD 4,000
CNY 92
Silver Star Developments Ltd.
Forward foreign exchange - Sell
Advance booking EUR to buy USD
EUR 2,200 USD 47
Notional Amount Fair Market Value
Financial Instrument
Item
(in thousands)
(in thousands)
MiTAC Computing Technology Corp.
Forward foreign exchange - Sell
Advance booking USD to buy NTD
USD 20,500
NTD 4,014
Forward foreign exchange - Buy
Advance booking USD to sell NTD
USD 13,000
NTD 1,376
MiTAC Digital Technology Corp.
Forward foreign exchange - Sell
Advance booking USD to buy NTD
USD 2,500
NTD 567
Forward foreign exchange - Buy
Advance booking USD to sell NTD
USD 4,000
NTD 130
MiTAC Technology (KunShan) Co., Ltd.
Forward foreign exchange - Sell
Advance booking USD to buy CNY
USD 300
CNY 5
December 31,2020
Item
Advance booking USD to buy NTD
Advance booking USD to sell NTD

Advance booking USD to buy NTD
Advance booking USD to sell NTD
Advance booking USD to buy CNY		 Notional Amount
(in thousands)
USD 20,500
USD 13,000
USD 2,500
USD 4,000
USD 300		 Fair Market Value
(in thousands)
NTD 4,014
NTD 1,376
NTD 567
NTD 130
CNY 5

~19~

September 30, 2020

==> picture [472 x 27] intentionally omitted <==

----- Start of picture text -----

Notional Amount Fair Market Value
Financial Instrument Item (in thousands) (in thousands)
----- End of picture text -----

Financial Instrument Item (in thousands) (in thousands)
MiTAC Computing Technology Corp.
Forward foreign exchange - Sell Advance booking USD to buy NTD USD 40,000 NTD 11,320
Forward foreign exchange - Buy Advance booking USD to sell NTD USD 4,000 NTD 1,856
Foreign exchange swap - Sell Advance booking USD to buy NTD USD 78,600 NTD 26,117
MiTAC Digital Technology Corp.
Forward foreign exchange - Sell Advance booking USD to buy NTD USD 5,500 NTD 1,327
Forward foreign exchange - Sell Advance booking EUR to buy USD EUR 652 NTD 115
Forward foreign exchange - Sell Advance booking AUD to buy USD AUD 1,600 NTD 564
Foreign exchange swap - Sell Advance booking USD to buy NTD USD 3,000 NTD 1,511
Silver Star Developments Ltd.
Forward foreign exchange - Sell Advance booking EUR to buy USD EUR 2,200 NTD 18

  • C. The Group has no financial assets at fair value through profit or loss pledged to others.

  • D. Information relating to credit risk of financial assets at fair value through profit or loss is provided in Note 12(2).

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

Items
Current items:
Equity instruments
Listed stocks
Valuation adjustment
Total
Non-current items:
Equity instruments
Listed stocks
Unlisted stocks
Subtotal
Valuation adjustment
Total		 September 30,2021 December 31,2020
800,614
$ 432,229
1,232,843
$ 1,225,051
$ 1,794,303
3,019,354
3,046,395
6,065,749
$		 September 30, 2020
887,725
$ 686,842
1,574,567
$ 19,991,750
$ 1,827,506
21,819,256
761,319
22,580,575
$		 800,614
$ 246,073
1,046,687
$ 1,225,051
$ 1,795,310
3,020,361
2,444,631
5,464,992
$

  • A. The Group recognised ($3,127,730), $408,260, ($2,030,463) and $860,367 in other comprehensive income for fair value change for the three months and nine months ended September 30, 2021 and 2020, respectively.

  • B. The Group has elected to designate the above investments, which were held mainly for medium to long-term trading purposes, as investments in equity instruments measured at fair value through other comprehensive income. As of September 30, 2021, December 31, 2020 and September 30, 2020, the fair value of investments were $24,155,142, $7,298,592 and $6,511,679, respectively.

  • C. The Group sold $12,303 of investments at fair value and resulted in cumulative losses on disposal amounting to $7,972 during the third quarter of 2020.

~20~

  • D. On September 1, 2021, the Group lost significant influence over TD Synnex Corp., and reclassified it from investments accounted for using equity method to financial assets at fair value through other comprehensive income based on the remeasurement at fair value amounting to $18,766,699.

(4) Financial assets at amortised cost

==> picture [489 x 144] intentionally omitted <==

----- Start of picture text -----

Items September 30, 2021 December 31, 2020 September 30, 2020
Current items:
- -
Structured deposits $ $ $ 132,339
Pledged deposits 312,974 8,754 8,687
$ 312,974 $ 8,754 $ 141,026
Non-current items:
Pledged deposits $ 43,730 $ 35,253 $ 35,166
$ 43,730 $ 35,253 $ 35,166
----- End of picture text -----

  • A. As of September 30, 2021, December 31, 2020 and September 30, 2020, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the financial assets at amortised cost held by the Group were $356,704, $44,007 and $176,192, respectively.

  • B. Information relating to credit risk of financial assets at amortised cost is provided in Note 12(2).

  • C. Details of the Group’s financial assets at amortised cost pledged to others as collateral are provided in Note 8.

(5) Accounts receivable

September 30,2021 December 31,2020 September 30,2020 September 30,2020
Third parties $ 5,528,626
 $ 5,073,532
 $ 6,226,755
Less: Allowance for bad
debts ( 90,295) ( 91,482) ( 91,651)
5,438,331 4,982,050 6,135,104
Related parties 3,163 215,960 350,311
$ 5,441,494 $ 5,198,010 $ 6,485,415

A. The ageing analysis of accounts receivable that were past due but not impaired is as follows:

Not past due
Up to 90 days
91 to 180 days
Over 181 days		 September 30,2021
5,202,494
$ 309,636
6,201
13,458
5,531,789
$		 5,011,648
$ 248,007
1,680
28,157
5,289,492
$ December 31,2020		 September 30,2020
6,065,047
$ 473,452
5,191
33,376
6,577,066
$

The above ageing analysis was based on past due date.

~21~

  • B. As of September 30, 2021, December 31, 2020 and September 30, 2020, accounts receivable and notes receivable were all from contracts with customers. And as of January 1, 2020, the balance of accounts receivable from contracts with customers amounted to $6,472,725.

  • C. As of September 30, 2021, December 31, 2020 and September 30, 2020, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the Group’s accounts receivable were $5,441,494, $5,198,010 and $6,485,415, respectively.

  • D. Information relating to credit risk of accounts receivable is provided in Note 12(2).

  • (6) Inventories

Inventories
Raw materials
Work in process
Finished goods
Total		 September 30,2021
December 31, 2020
Book value
Book value
8,612,939
$ 6,699,085
$ 767,922
643,449
1,347,094
1,780,470

10,727,955
$ 9,123,004
$		 September 30,2020
Book value
5,682,720
$ 1,283,386
1,742,267
8,708,373
$

The cost of inventories recognised as expense for the period:

The cost of inventories recognised as expense for the period:
Total
10,727,955
$ 9,123,
$		 004
8,708,373
$
For the three months ended
September 30,2021
Cost of goods sold
8,277,660
$ Loss on (reversal of) decline in market
value
1,215)
(
8,276,445
$ For the nine months ended
September 30, 2021
Cost of goods sold
29,547,577
$ Loss on decline in market value
11,036
29,558,613
$		 For the three months ended
September 30,2020
10,512,098
$ 40,477
10,552,575
$
For the nine months ended
September 30,2020
27,299,144
$ 136,480
27,435,624
$

The Group reversed a previous inventory write-down because inventories with allowance for valuation loss were partially sold by the Group for the three months ended September 30, 2021.

~22~

(7) Investments accounted for using equity method

A.

Investee company
Getac Holdings Corp. (Note 1)
3 Probe Technology Co., Ltd.
Lian Jie Investment Co., Ltd.
Lian Jie II Investment Co., Ltd.
Shen-Tong Construction &
Development Co., Ltd.
Mainpower International Ltd.
Concentrix Corp.
TD Synnex Corp. (Note 2)
Suzhou MiTAC Preclusion
Technology Co., Ltd.
Loyal Fidelity Aerospace Corp.
Harbinger Ruyi Venture Ltd.
Harbinger Ruyi II Venture Ltd.
Infopower Technologies Ltd.		 September 30,2021
5,477,847
$ 11,610
174,916
33,009
85,853
250,959
6,699,569
-

368,493
120,092

18,716
53,925

68,831
13,363,820
$		 December 31,2020
5,249,079
$ 13,962
168,258
42,467
86,012
240,230
6,677,974
5,977,703
354,254
123,406
18,970

49,096
70,278
19,071,689
$		 September 30,2020
4,953,091
$ 11,343

157,934

40,807

86,057

229,113

-
12,215,669
336,621
123,777
19,348
48,299
70,673
18,292,732
$

Note 1: On October 12, 2021, Getac Technology Corp. completed the registration and was renamed to Getac Holdings Corp.

  • Note 2: On September 1, 2021, Synnex Corp. announced the change in its name to TD Synnex Corp.

  • B. The Group recognized its share of profit from associates accounted for using equity method for the three months and nine months ended September 30, 2021 and 2020 amounting to $733,968, $586,114, $2,663,448 and $1,531,304, respectively, and recognized its share of other comprehensive income from associates accounted for using equity method amounting to $33,986, $503,941, $73,721 and $35,191, respectively.

  • C. The basic information of the associates that are material to the Group is as follows:

Companyname
Getac Holdings
Corp.
TD Synnex Corp.
Concentrix Corp.		 Principal place
of business		 September
30,2021
December
31,2020
September
30,2020
Shareholdingratio		 September
30,2021
December
31,2020
September
30,2020
Shareholdingratio		 September
30,2021
December
31,2020
September
30,2020
Shareholdingratio		 Nature of
relationship		 Methods of
measurement
September
30,2021		 December
31,2020
Taiwan
USA
USA		 31.97%
-%
9.44%		 32.31%
10.28%
10.28%		 32.48%
10.28%
-		 Owned over 20%
ownership
Significant
influence (Note)
Significant
influence		 Equity method
Equity method (Note)
Equity method

Note : Please refer to Note 6(7) J.

~23~

D. The summarized financial information of the associates that are material to the Group is as follows:

Balance sheet

Balance sheet
Getac Holdings Corp.
September 30,2021 December 31,2020 September 30,2020
Current assets $ 21,457,580
 $ 19,825,742
 $ 17,314,613
Non-current assets 13,872,940
 14,029,191 13,583,153
Current liabilities ( 12,078,361)
 ( 11,735,921)
 ( 9,937,119)
Non-current liabilities ( 4,410,147)
 ( 4,125,717)
 ( 3,992,108)
Non-controlling interest ( 1,710,192)
 ( 1,748,248)
 ( 1,718,115)
Total net assets $ 17,131,820
 $ 16,245,047
 $ 15,250,424
Share in associate’s net
assets $ 5,477,847
 $ 5,249,079 $ 4,953,091
TD Synnex Corp.
September 30,2021 December 31,2020 September 30,2020
Current assets $ -
 $ 209,922,862
 $ 249,216,794
Non-current assets - 27,111,310 136,456,739
Current liabilities - ( 132,336,507)
 ( 163,895,507)
Non-current liabilities - ( 46,502,998) ( 102,899,143)
Total net assets $ - $ 58,194,667 $ 118,878,883
Share in associate’s net
assets $ - $ 5,977,703 $ 12,215,669
Concentrix Corp.
September 30,2021 December 31,2020 September 30,2020
Current assets $ 41,241,004
 $ 40,537,748
 $ -
Non-current assets 97,827,581 106,421,273 -
Current liabilities ( 24,752,857)
 ( 28,782,657)
 -
Non-current liabilities ( 43,363,675) ( 53,166,720) -
Total net assets $ 70,952,053 $ 65,009,644 $ -
Share in associate’s net
assets $ 6,699,569 $ 6,677,974 $ -

~24~

Statement of comprehensive income

Statement of comprehensive income
Getac Holdings Corp.
For the For the
three months ended three months ended
September 30,2021 September 30,2020
Revenue $ 7,464,102 $ 7,086,833
Profit for the period from continuing
operations $ 613,320
 $ 661,229
Other comprehensive (loss) income - net of tax ( 59,786) 227,158
Total comprehensive income $ 553,534 $ 888,387
Getac Holdings Corp.
For the For the
nine months ended nine months ended
September 30,2021 September 30, 2020
Revenue $ 22,357,792 $ 20,085,154
Profit for the period from continuing
operations $ 3,528,416
 $ 1,899,874
Other comprehensive loss - net of tax ( 769,686) ( 48,488)
Total comprehensive income $ 2,758,730
 $ 1,851,386
Dividends received from associates $ 682,971 $ 532,345
TD Synnex Corp.
For the For the
three months ended three months ended
September 30,2021 September 30,2020
Revenue $ 145,020,476 $ 190,786,545
Profit for the period from continuing
operations $ 2,632,880
 $ 3,829,837
Other comprehensive (loss) income - net of tax ( 351,920) 822,136
Total comprehensive income $ 2,280,960 $ 4,651,973
Dividends received from associates $ 29,529 $ -

~25~

Revenue Profit for the period from continuing operations Other comprehensive income (loss) - net of tax Total comprehensive income Dividends received from associates

Revenue

Profit for the period from continuing operations Other comprehensive loss - net of tax Total comprehensive income

Revenue

Profit for the period from continuing operations Other comprehensive loss - net of tax Total comprehensive income

TD Synnex Corp. TD Synnex Corp.
For the For the
nine months ended nine months ended
September 30, 2021 September 30, 2020
$ 449,162,148
 514,705,229
$
$ 7,712,595
 9,109,339
$
943,350 523,871)
(
$ 8,655,945
 8,585,468)
($
$ 89,254 63,107
$
Concentrix Corp.
For the For the
three months ended three months ended
September 30,2021 September 30,2020
$ 38,932,610 -
$
$ 2,976,036
 -
$
( 1,991,365) -
$ 984,671 -
$
Concentrix Corp.
For the For the
nine months ended nine months ended
September 30,2021 September 30,2020
$ 115,649,688 $-
$ 7,692,443
 $ -
( 1,030,893) -
$ 6,661,550 $-

  • Note 1: Concentrix Corp. was established on December 1, 2020. Thus, the information related to its statement of comprehensive income was not available for the three months and nine months ended September 30, 2020.

  • Note 2: The Group lost control over TD Synnex Corp. since September 1, 2021. Thus, only the financial information as of August 31, 2021 was disclosed.

  • E. The carrying amount of the Group’s interests in all individually immaterial associates and the Group’s share of the operating results are summarized below:

  • As of September 30, 2021, December 31, 2020 and September 30, 2020, the carrying amount of the Group’s individually immaterial associates amounted to $1,186,404, $1,166,933 and $1,123,972 , respectively.

~26~

For the For the
three months ended three months ended
September 30,2021 September 30,2020
(Loss) profit for the period from continuing ($ 7,334)
 $ 12,728
operations
Other comprehensive (loss) income - net of tax ( 28,635)
 247,168
Total comprehensive (loss) income ($ 35,969) $ 259,896
For the For the
nine months ended nine months ended
September 30, 2021 September 30, 2020
Profit for the period from continuing operations $ 72,524
 $ 176,382
Other comprehensive income - net of tax 55,572 240,194
Total comprehensive income $ 128,096 $ 416,576
The fair value of the Group’s material associates with quoted market prices is as follows:
September 30,2021 December 31,2020 September 30,2020
Getac Holdings Corp.
$		 9,843,522
 $ 9,310,410
 $ 8,691,620
TD Synnex Corp.
 -
 12,292,833 21,601,372
Concentrix Corp. 24,352,597 14,898,117 -
$ 34,196,119 $ 36,501,360
 $ 30,292,992

  • F. The fair value of the Group’s material associates with quoted market prices is as follows:

  • G. The Group increased its investment in TD Synnex Corp. amounting to $132,394 for the nine months ended September 30, 2020.

  • H. The Group sold part of its ownership in Concentrix Corp. for proceeds of $1,469,173 and resulted in gains on disposal amounting to $999,977 during the second quarter of 2021.

  • I. The Group holds 13.28% ownership in Mainpower International Ltd. but has significant influence over Mainpower International Ltd. as the Group serves as this company’s corporate director.

  • J. The Group originally held 10.21% ownership in TD Synnex Corp. but has significant influence over TD Synnex Corp. as the Group is the major shareholder of TD Synnex Corp. and the Company’s chairman Feng Chiang Miau serves as this company’s honorary chairman. On September 1, 2021, this company issued shares for acquisitions resulting in a decrease in the ownership held by the Group down to 5.52% and the Group lost significant influence over it. On the same day, the Group reclassified it from investments accounted for using equity method at book value to financial assets at fair value through other comprehensive income based on the remeasurement at fair value, and recognised the difference as gains on disposal of investments amounting to $12,820,034.

  • K. On December 1, 2020, TD Synnex Corp. completed the spin-off and established Concentrix Corp. The numbers of shares of Concentrix Corp. acquired by the shareholders of TD Synnex Corp. is equivalent to the numbers of shares in TD Synnex Corp. they held. Given that the Group is the major shareholder and one of the directors of Concentrix Corp., these indicate that the Group has significant influence over it.

~27~

  • L. TD Synnex Corp.’s, Concentrix Corp.’s and Hyve Design Solutions Corporation’s fiscal year ends on November 30, thus, the Group uses the financial information from December 1, 2020 to August 31,2021 as the basis for the preparation of third quarter consolidated financial statements; Infopower Technologies Ltd.’s fiscal year ends on March 31, thus, the Group uses the financial information from January 1 to September 30 as the basis for the preparation of annual consolidated financial statements; other associates’ fiscal year all end on December 31.

  • M. On August 19, 2020, the Group has no current ability to direct the decisions of relevant activities on meetings of their Board of Directors of Hyve Design Solutions Corporation. Thus, the Group lost control, but has significant influence over the associate. As a result, the Group derecognised the assets, liabilities and non-controlling interest of Hyve Design Solutions Corporation in their carrying amount on the date that control ceased from the consolidated financial statements according to IAS 10. The Group recognised the retained 50% share of the investment as the investment accounted for using equity method – associate at fair value on August 19, 2020. As of September 30, 2021, December 31, 2020 and September 30, 2020, the carrying amounts of the associate were ($83,195),($22,604) and ($1,430), respectively, and shown as other non-current liabilities.

  • N. The Group is the single largest shareholder of certain associates. Given that the Group has no majority voting rights, which indicates that the Group has no current ability to direct the decisions of relevant activities on meetings of their Board of Directors and shareholders after the comprehensive assessment. Thus, the Group has no control, but only has significant influence, over the associates.

~28~

(8) Property, plant and equipment

At January 1, 2021
Cost
Accumulated depreciation
and impairment
2021
At January 1
Additions
Disposal
Reclassifications(Note)
Depreciation
Effects of foreign exchange

At September 30
At September 30, 2021
Cost
Accumulated depreciation
and impairment		 Construction
Computer and
in progress
Buildings
communication
Transportation
Office
Leasehold
Molding
Other
and equipment
Land
and structures
Machinery
equipment
equipment
equipment
improvements
equipment
equipment
under inspection
Total
1,085,382
$ 6,450,874
$ 2,825,267
$ 179,594
$ 78,039
$ 187,613
$ 156,264
$ 160,589
$ 1,187,180
$ 1,127,805
$ 13,438,607
$ -
2,784,681)
(
1,713,572)
(
133,697)
(
52,861)
(
157,065)
(
60,327)
(
60,903)
(
722,414)
(
-
5,685,520)
(
1,085,382
$ 3,666,193
$ 1,111,695
$ 45,897
$ 25,178
$ 30,548
$ 95,937
$ 99,686
$ 464,766
$ 1,127,805
$ 7,753,087
$ 1,085,382
$ 3,666,193
$ 1,111,695
$ 45,897
$ 25,178
$ 30,548
$ 95,937
$ 99,686
$ 464,766
$ 1,127,805
$ 7,753,087
$ -
5,665
37,309
45,076
4,210
14,134
23,428
38,728
80,827
280,147
529,524
-
2)
(
324)
(
94)
(
264)
(
26)
(
246)
(
-
24)
(
-
980)
(
-
1,221,523
15,558
3,397
14)
(
14)
(
875
-
7,358
1,285,173)
(
36,490)
(
-
179,615)
(
234,412)
(
25,335)
(
6,747)
(
15,280)
(
21,553)
(
50,496)
(
125,002)
(
-
658,440)
(
4,015)
(
36,224)
(
13,897)
(
364)
(
112)
(
341)
(
693)
(
-
4,699)
(
10,446)
(
70,791)
(
1,081,367
$ 4,677,540
$ 915,929
$ 68,577
$ 22,251
$ 29,021
$ 97,748
$ 87,918
$ 423,226
$ 112,333
$ 7,515,910
$ 1,081,367
$ 7,597,272
$ 2,738,273
$ 214,942
$ 75,180
$ 193,289
$ 178,898
$ 184,778
$ 1,252,737
$ 112,333
$ 13,629,069
$ -
2,919,732)
(
1,822,344)
(
146,365)
(
52,929)
(
164,268)
(
81,150)
(
96,860)
(
829,511)
(
-
6,113,159)
(
1,081,367
$ 4,677,540
$ 915,929
$ 68,577
$ 22,251
$ 29,021
$ 97,748
$ 87,918
$ 423,226
$ 112,333
$ 7,515,910
$		 Total
13,438,607
$ 5,685,520)
(
7,753,087
$
7,515,910
$
13,629,069
$ 6,113,159)
(
7,515,910
$

Note: In 2021, the Group reclassified property, plant and equipment as investment property amounting to $36,490.

~29~

At January 1, 2020
Cost
Accumulated depreciation
and impairment
2020
At January 1
Additions
Disposal
Reclassifications
Effects from disposal of
subsidiaries
Depreciation
Effects of foreign exchange

At September 30
At September 30, 2020
Cost
Accumulated depreciation
and impairment		 Construction
Computer and
in progress
Buildings
communication
Transportation
Office
Leasehold
Molding
Other
and equipment
Land
and structures
Machinery
equipment
equipment
equipment
improvements
equipment
equipment
under inspection
Total
1,094,943
$ 6,425,643
$ 2,547,343
$ 201,072
$ 72,293
$ 192,175
$ 132,544
$ 122,834
$ 1,083,777
$ 937,087
$ 12,809,711
$ -
2,546,673)
(
1,408,956)
(
138,320)
(
45,991)
(
148,115)
(
42,481)
(
32,358)
(
635,822)
(
-
4,998,716)
(
1,094,943
$ 3,878,970
$ 1,138,387
$ 62,752
$ 26,302
$ 44,060
$ 90,063
$ 90,476
$ 447,955
$ 937,087
$ 7,810,995
$ 1,094,943
$ 3,878,970
$ 1,138,387
$ 62,752
$ 26,302
$ 44,060
$ 90,063
$ 90,476
$ 447,955
$ 937,087
$ 7,810,995
$ -
4,363
198,074
14,345
6,434
6,616
31,255
50,822
139,524
261,022
712,455
-
1)
(
897)
(
-
-
-
22)
(
-
276)
(
-
1,196)
(
-
9,825
63,288
378
-
295
6,214
-
17,577
85,227)
(
12,350
-
-
-
-
-
3,925)
(
10,706)
(
-
16,295)
(
-
30,926)
(
-
167,796)
(
233,502)
(
25,776)
(
7,476)
(
14,933)
(
19,614)
(
30,553)
(
119,711)
(
-
619,361)
(
5,609)
(
23,454)
(
8,572)
(
84)
(
51)
(
167)
(
207)
(
-
2,470)
(
7,159)
(
47,773)
(
1,089,334
$ 3,701,907
$ 1,156,778
$ 51,615
$ 25,209
$ 31,946
$ 96,983
$ 110,745
$ 466,304
$ 1,105,723
$ 7,836,544
$ 1,089,334
$ 6,395,493
$ 2,766,997
$ 198,930
$ 76,241
$ 185,551
$ 155,709
$ 165,408
$ 1,200,028
$ 1,105,723
$ 13,339,414
$ -
2,693,586)
(
1,610,219)
(
147,315)
(
51,032)
(
153,605)
(
58,726)
(
54,663)
(
733,724)
(
-
5,502,870)
(
1,089,334
$ 3,701,907
$ 1,156,778
$ 51,615
$ 25,209
$ 31,946
$ 96,983
$ 110,745
$ 466,304
$ 1,105,723
$ 7,836,544
$		 Total
12,809,711
$ 4,998,716)
(
7,810,995
$
7,836,544
$
13,339,414
$ 5,502,870)
(
7,836,544
$

~30~

－ (9) Leasing arrangements lessee

  • A. The Group leases various assets including land, buildings and structures, machinery, office equipment and transportation equipment. Rental contracts are typically made for periods of 1 to 20 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants.

  • B. Certain leased buildings with lease terms under 12 months are short-term lease agreements. Additionally, the leased office equipment were low-value assets.

  • C. The book value of right-of-use assets and the depreciation charge is as follows:

September 30,2021
December 31,2020
September 30,2020
Book value
Book value
Book value
Land
$ 227,791 $ 238,179 $ 292,621
Buildings and
structures
89,595 118,168 48,123
Machinery
664
389

451
Transportation
equipment
2,130
3,138
3,475
320,180
$ 359,874
$ 344,670
$ For the three months ended
For the three months ended
September 30,2021
September 30,2020
Depreciation charge
Depreciation charge
Land
$ 2,718 $ 3,579
Buildings and structures
7,924 8,593
Machinery
60
86
Transportation equipment
337
336
11,039
$ 12,594
$ For the nine months ended
For the nine months ended
September 30,2021
September 30,2020
Depreciation charge
Depreciation charge
Land
$ 8,247 $ 10,737
Buildings and structures
25,044 29,087
Machinery
238
248
Transportation equipment
1,009
560
34,538
$ 40,632
$		 September 30,2021
Book value		 September 30,2021
Book value		 September 30,2021
Book value		 December 31,2020 December 31,2020 December 31,2020 September 30,2020
Book value
$ 292,621
48,123
451
3,475
344,670
$ the three months ended
September 30,2020
Depreciation charge Depreciation charge

$ 2,718
7,924
60
337
11,039
$ For the nine months ended
September 30,2021
$ 3,579
8,593
86
336
12,594
$ For the nine months ended
September 30,2020
Depreciation charge Depreciation charge

$ 8,247
25,044
238
1,009
34,538
$
$ 10,737
29,087
248
560
40,632
$
  • D. For the nine months ended September 30, 2021 and 2020, the additions to right-of-use assets were $1,053 and $11,841, respectively.

~31~

E. The information on profit and loss accounts relating to lease contracts is as follows:

Items affecting profit or loss
Interest expense on lease liabilities

Expense on short-term lease contracts
Expense on leases of low-value assets
Items affecting profit or loss
Interest expense on lease liabilities

Expense on short-term lease contracts

Expense on leases of low-value assets
 For the three
months ended
For the three
months ended
September 30,2021
September 30,2020
$ 826 $ 676
5,154
941
1,209
2,197
7,189
$ 3,814
$ For the nine
months ended
For the nine
months ended
September 30, 2021
September 30, 2020
$ 2,617 $ 3,179
14,463 16,572
2,559
3,970
19,639
$ 23,721
$

  • F. For the nine months ended September 30, 2021 and 2020, the Group’s total cash outflow for leases were $49,181 and $65,081, respectively.

  • －

  • (10) Leasing arrangements lessor

  • A. The Group leases various assets including buildings and structures. Rental contracts are typically made for periods of 1 to 8 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.

  • B. For the three months and nine months ended September 30, 2021 and 2020, the Group recognised rent income in the amounts of $28,255, $27,172, $83,147 and $76,364, respectively, based on the operating lease agreement, which does not include variable lease payments.

  • C. The maturity analysis of the lease payments under the operating leases are as follows:

September 30,2021
99,397
$ Later than one year but
123,852
not later than five years
Over five years
3,563
226,812
$ Not later than one year		 December 31,2020
108,941
$ 141,206
6,211
256,358
$		 September 30,2020
99,473
$ 162,479
6,899
268,851
$

~32~

(11) Investment property

nvestment property
Buildings
Land and structures Total
At January 1, 2021
Cost $ 954,835
 $ 609,265
 $ 1,564,100
Accumulated depreciation and
impairment - ( 334,669) ( 334,669)
$ 954,835 $ 274,596 $ 1,229,431
2021
At January 1 $ 954,835
 $ 274,596
 $ 1,229,431
Additions - 12,557 12,557
Reclassification - 36,490 36,490
Depreciation - ( 15,010)
 ( 15,010)
Effects of foreign exchange ( 1,175) ( 8,442)
 ( 9,617)
At September 30 $ 953,660 $ 300,191 $ 1,253,851
At September 30, 2021
Cost $ 953,660
 $ 642,050
 $ 1,595,710
Accumulated depreciation and
impairment - ( 341,859) ( 341,859)
$ 953,660 $ 300,191
 $ 1,253,851
Buildings
Land and structures Total
At January 1, 2020
Cost $ 954,213
 $ 598,434
 $ 1,552,647
Accumulated depreciation and
impairment - ( 309,826) ( 309,826)
$ 954,213 $ 288,608 $ 1,242,821
2020
At January 1 $ 954,213
 $ 288,608
 $ 1,242,821
Depreciation - ( 14,448)
 ( 14,448)
Effects of foreign exchange 244 534 778
At September 30 $ 954,457 $ 274,694 $ 1,229,151
At September 30, 2020
Cost $ 954,457
 $ 598,471
 $ 1,552,928
Accumulated depreciation and
impairment - ( 323,777) ( 323,777)
$ 954,457 $ 274,694 $ 1,229,151

~33~

  • A. Rental income from investment property and direct operating expenses arising from investment property are shown below ：

Rental income from the lease of the investment property Direct operating expenses arising from the investment property that generated rental income in the period Direct operating expenses arising from the investment property that did not generate rental income in the period

Rental income from the lease of the investment property Direct operating expenses arising from the investment property that generated rental income in the period Direct operating expenses arising from the investment property that did not generate rental income in the period

For the three months
ended
September 30,2021
6,086
$ 4,266
$ 4,876
$ For the nine months
ended
September 30,2021
18,325
$
13,164
$ 12,338
$		 For the three months
ended
September 30,2020
5,476
$
4,206
$ 3,280
$
For the nine months
ended
September 30,2020
16,041
$
12,409
$
9,711
$
  • B. The fair value of the investment property held by the Group on September 30, 2021, December 31, 2020 and September 30, 2020 were $3,487,463, $3,502,285 and $3,480,419, respectively, which were revalued by independent appraisers and with reference to market transaction prices. Valuations were made using the market approach and cost approach which is categorised within Level 3 in the fair value hierarchy.

~34~

(12) Intangible assets

Intangible assets
Computer software
2021 2020
At January 1
Cost $ 275,844
 $ 264,109
Accumulated amortization and impairment ( 199,940) ( 174,661)
$ 75,904 $ 89,448
At January 1 $ 75,904
 $ 89,448
Additions 73,682 59,171
Amortization ( 71,288)
 ( 66,826)
Effects from disposal of subsidiaries - ( 835)
Effects of foreign exchange ( 36) ( 19)
At September 30 $ 78,262 $ 80,939
At September 30
Cost $ 264,685
 $ 260,883
Accumulated amortization and impairment ( 186,423)
 ( 179,944)
$ 78,262 $ 80,939
Details of amortization of intangible assets are as follows:
For the For the
three months ended three months ended
September 30, 2021 September 30,2020
Operating costs $ 331
 $ 329
Selling expenses 2,437 4,090
Administrative expenses 4,184 3,687
Research and development expenses 17,414 13,567
$ 24,366 $ 21,673
For the For the
nine months ended nine months ended
September 30,2021 September 30,2020
Operating costs $ 994
 $ 978
Selling expenses 7,536 12,908
Administrative expenses 11,725 10,041
Research and development expenses 51,033 42,899
$ 71,288 $ 66,826

~35~

(13) Non-current assets held for sale

  • A. To cooperate with the Government of Foshan City, Guangdong Province, China to conduct landuse-right expropriation, the Board of Directors adopted a resolution on November 7, 2019 to dispose of the land-use-right and related buildings located in the Shunde District, Foshan City through public auction by the Land Arrangement and Reserve Center of Shunde District, Foshan City (“Shunde Land Development Center”) by way of land-use-right requisition on credit. The titles of land-use-right and related buildings have been transferred to and would be managed by Shunde Land Development Center. Therefore, the Group reclassified related assets as noncurrent assets held for sale in December 2019. As at September 30, 2021, the Group has completed the disposal with proceeds amounting to $334,976 and recognised $301,191 of gain on disposal.

  • B. In addition, to cooperate with the Government of Foshan City, Guangdong Province, China to conduct land-use-right expropriation, the Board of Directors adopted a resolution on December 25, 2020 to dispose of the land-use-right of certain land located in the Shunde District, Foshan City to Shunde Land Development Center. Therefore, the Group reclassified related assets as non-current assets held for sale in December 2020. As at September 30, 2021, the Group has completed the disposal with proceeds amounting to $798,531 and recognised $742,994 of gain on disposal.

Non-current assets held for the sale:

on disposal.
Non-current assets held for the sale:		 on disposal.
Non-current assets held for the sale:
(14)
(15)		 Short-term borrowings
Financial liabilities at fair value through profit or loss
September 30, 2021
December31,2020
Right-of-use assets
-
$ 68,515
$ Investment property
-
21,618
-
$ 90,133
$ September 30,2021
December 31,2020
Unsecured bank
borrowings
1,555,528
$ 1,443,851
$ Secured bank
borrowings
279,196
-

1,834,724
$ 1,443,851
$ Interest rates
0.39%~0.48%
0.56%~0.63%
Items
September 30,2021
December 31,2020
Current items:
Financial liabilities
held for trading
Valuation adjustment -
Derivatives
1,850
$ 11,691
$		 September 30, 2020
12,165
$ 21,085
33,250
$ September 30, 2020
3,056,123
$ -
3,056,123
$ 0.44%~1%
September 30,2020
9,274
$

Items
Current items:
Financial liabilities
held for trading
Valuation adjustment -
Derivatives
September 30,2021
1,850
$

~36~

  • A. The Group recognised net profit (loss) of $12,831, ($573), $ 9,778 and ($672) for the three months and nine months ended September 30, 2021 and 2020, respectively.

  • B. The non-hedging derivative instrument transactions and contract information are as follows:

Notional Amount
Financial Instrument
Item
(in thousands)
MiTAC Computing Technology Corp.
Forward foreign exchange - Buy
Advance booking JPY to sell USD
JPY 262,000
MiTAC Digital Technology Corp.
Forward foreign exchange - Sell
Advance booking USD to buy JPY
USD 5,300
Forward foreign exchange - Sell
Advance booking AUD to buy USD
AUD 250
Forward foreign exchange - Buy
Advance booking JPY to sell USD
JPY 25,000
September 30,2021		 Fair Market Value
(in thousands)
(NTD 216)
(NTD 1,608)
(NTD 8)
(NTD 18)

==> picture [471 x 37] intentionally omitted <==

----- Start of picture text -----

December 31, 2020
Notional Amount Fair Market Value
Financial Instrument Item (in thousands) (in thousands)
----- End of picture text -----

Financial Instrument Item Notional Amount
(in thousands)		 Fair Market Value
(in thousands)
MiTAC Computing Technology Corp.
Forward foreign exchange - Sell Advance booking USD to buy NTD USD 14,000 (NTD 1,085)
Forward foreign exchange - Buy Advance booking USD to sell NTD USD 12,500 (NTD 1,562)
MiTAC Digital Technology Corp.
Forward foreign exchange - Sell Advance booking USD to buy NTD USD 6,000 (NTD 1,141)
Forward foreign exchange - Buy Advance booking USD to sell NTD USD 3,500 (NTD 319)
Forward foreign exchange - Sell Advance booking EUR to buy USD EUR 800 (NTD 722)
Forward foreign exchange - Sell Advance booking AUD to buy USD AUD 3,250 (NTD 4,471)
Silver Star Developments Ltd.
Forward foreign exchange - Sell Advance booking EUR to buy USD EUR 2,200 (USD 79)
Mitac Australia Pty Ltd.
Forward foreign exchange - Buy Advance booking USD to sell AUD USD 100 (AUD 6)
Notional Amount
Financial Instrument
Item
(in thousands)
MiTAC Computing Technology Corp.
Forward foreign exchange - Sell
Advance booking USD to buy NTD
USD 8,000
Forward foreign exchange - Buy
Advance booking USD to sell NTD
USD 44,000
Forward foreign exchange - Sell
Advance booking CNY to buy USD
CNY 5,000
MiTAC Digital Technology Corp.
Forward foreign exchange - Sell
Advance booking USD to buy NTD
USD 2,000
Forward foreign exchange - Buy
Advance booking USD to sell NTD
USD 7,500
Forward foreign exchange - Sell
Advance booking EUR to buy USD
EUR 200
Forward foreign exchange - Sell
Advance booking AUD to buy USD
AUD 900
Mitac Australia Pty Ltd.
Forward foreign exchange - Buy
Advance booking USD to sell AUD
USD 300
September 30,2020		 September 30,2020 September 30,2020
Notional Amount
(in thousands)
USD 8,000
USD 44,000
CNY 5,000
USD 2,000
USD 7,500
EUR 200
AUD 900
USD 300		 Fair Market Value
(in thousands)
(NTD 633)
(NTD 7,082)
(NTD 149)
(NTD 18)
(NTD 1,162)
(NTD 40)
(NTD 150)
(AUD 2)

~37~

- (16) Long term borrowings

Long-term borrowings
September30,2021 December31,2020 September30,2020
Unsecured bank
borrowings $ 912,220
 $ 910,634
 $ 863,561
Less: Current portion
(shown as ‘other current
liabilities’) ( 208,082)
 ( 47,268)
 -
$ 704,138
 $ 863,366
 $ 863,561
Interest rate range (Note) 0.49%~0.5% 0.49%~1% 0.49%~0.5%
2024.10.15~ 2024.10.15~ 2024.10.15~
Expiry date 2026.10.15 2026.10.15 2026.10.15

Note: The abovementioned interest rates are the interest rates after obtaining the government project grants.

(17) Pensions

  • A. Defined benefit plan

  • (a) The Company’s domestic subsidiaries have a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company’s and its domestic subsidiaries contribute monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. Also, the Company’s domestic subsidiaries would assess the balance in the aforementioned labor pension reserve account by the end of December 31, every year. If the account balance is insufficient to pay the pension calculated by the aforementioned method, to the employees expected to be qualified for retirement next year, the Company’s domestic subsidiaries will make contributions to cover the deficit by next March.

  • (b) For the aforementioned pension plan, the Company’s domestic subsidiaries recognized pension costs of $2,055, $2,096, $6,185 and $6,273 for the three months and nine months ended September 30, 2021 and 2020, respectively.

  • (c) Expected contributions to the defined benefit pension plans of the Company’s domestic subsidiaries for the year ending December 31, 2022 amount to $8,208.

~38~

  • B. Defined contribution plans

  • (a) Effective July 1, 2005, the Company’s domestic subsidiaries have established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, Company’s domestic subsidiaries contribute monthly an amount not lower than 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.

  • (b)The Group’s Mainland China subsidiaries have a defined contribution plan. Monthly contributions to an independent fund administered by the government in accordance with the pension regulations in the People’s Republic of China (PRC) are based on certain percentages of employees’ monthly salaries and wages. Other than the monthly contributions, the Group has no further obligations.

  • (c) The pension costs under the defined contribution pension plans of the Group for the three months and nine months ended September 30, 2021 and 2020 were $56,110, $30,185, $160,706 and $112,713, respectively.

(18) Provisions

Analysis of total provisions:
Warranty
At January 1
Additional provisions
Used during the period
Effects of foreign exchange
At September 30
Current
Non-current


September 30, 2021
110,339
$ 137,370
$		 2021
256,074
$ 64,265
71,516)
(
1,114)
(
247,709
$ December 31,2020
132,169
$ 123,905
$		 2020
252,306
$ 76,229
72,529)
(
156)
(
255,850
$ September 30,2020
145,820
$ 110,030
$

~39~

(19) Share capital

A. As of September 30, 2021, the Company’s authorized capital was $15,000,000, consisting of 1.5 billion shares, and the paid-in capital was $12,065,568 with a par value of $10 dollars per share. Movements in the number of the Company’s ordinary shares outstanding are as follows:

Unit: in thousands of shares

Outstanding shares as of January 1
Disposal of the Company’s treasury share by
subsidiaries
Capital increase of earnings
Capital increase of treasury share acquired by
the subsidiaries
Outstanding shares as of September 30		 2021
2020
1,195,178
1,061,382

-
5,816

-
129,274

-

1,294)
(
1,195,178
1,195,178

  • B. Treasury shares

  • (a) Reason for share reacquisition and movements in the number of the Company’s treasury shares are as follows:

shares are as follows:
September 30,2021
Name of company Reason for Number of shares
holdingthe shares reacquisition (shares in thousands) Book value
Subsidiary - Tsu Fung
Investment Corp.		 Stock conversion 9,250 $ 162,874
Subsidiary - SSDL " 2,128 77,002
December 31,2020
Name of company Reason for Number of shares
holdingthe shares reacquisition (shares in thousands) Book value
Subsidiary - Tsu Fung
Investment Corp.		 Stock conversion 9,250 $ 162,874
Subsidiary - SSDL " 2,128 77,002
September 30,2020
Name of company Reason for Number of shares
holdingthe shares reacquisition (shares in thousands) Book value
Subsidiary - Tsu Fung
Investment Corp.		 Stock conversion 9,250 $ 162,874
Subsidiary - SSDL " 2,128 77,002

(b) Pursuant to the R.O.C. Securities and Exchange Act, the number of shares bought back as treasury shares should not exceed 10% of the number of the Company’s issued and outstanding shares and the amount bought back should not exceed the sum of retained earnings, paid-in capital in excess of par value and realized capital surplus.

~40~

  • (c) Pursuant to the R.O.C. Securities and Exchange Act, treasury stock should not be pledged as collateral and is not entitled to dividends.

  • (d) Pursuant to the R.O.C. Securities and Exchange Act, treasury shares should be reissued to the employees within five years from the reacquisition date and shares not reissued within the five-year period are to be retired. Treasury shares to enhance the Company’s credit rating and the stockholders’ equity should be retired within nine months of acquisition.

  • (e) In accordance with the “Rule No. Financial-Supervisory-Commission, Securities and Futures Bureau, 1010047490,” the Company shall not appropriate special reserve proportionately to the shareholding ratio for the difference of ending market price below the carrying amount of the parent’s stock held by the subsidiaries. If the market price reverses subsequently, the reversal amount shall be appropriated as special reserve proportionately to the shareholding ratio.

  • (f) For the nine months ended September 30, 2020, the subsidiary, Tsu Fung Investment Corp. disposed 5,816 thousand shares of the Company amounting to $196,628.

  • (20) Capital surplus

Capital surplus
At January 1, 2021
Subsidiaries received cash
dividends paid by the
parent company
Changes from associates
and joint ventures
accounted for using
the equity method
Recognition of dividends
unclaimed by the
subsidiaries' shareholders
dividends transferred to
capital surplus
Proceeds from disposal of
investments accounted
for using equity method
At September 30, 2021		 Share
premium
21,571,329
$ -
-
-
-
21,571,329
$		 Treasury
stock
transaction
457,198
$ 11,379
-
-
-

468,577
$		 Net equity of
associates and
joint ventures
accounted for using
equitymethod
1,205,361
$ -
11,227
-
1,016,022)
(
200,566
$		 Changes in
ownership interests
in subsidiaries
609
$ -
-
-
-
609
$		 Employee
stock options
346,814
$ -
-
-
-
346,814
$		 Others
1,100
$ -
-
376
-

1,476
$		 Total
23,582,411
$ 11,379
11,227
376
1,016,022)
(
22,589,371
$

~41~

At January 1, 2020
Disposal of company’s share
by subsidiaries recognized
as treasury share
transactions
Subsidiaries received cash
dividends paid by the parent
company
Changes from associates and
joint ventures accounted
for using the equity method
Recognition of dividends
unclaimed by the
subsidiaries' shareholders
dividends transferred to
capital surplus
At September 30, 2020		 Share
premium
21,571,329
$ -
-
-
-
21,571,329
$		 Treasury
stock
transaction
362,997
$ 83,417
10,784

-
-

457,198
$		 Net equity of
associates and
joint ventures
accounted for using
equitymethod
1,118,253
$ -
-

96,319

-
1,214,572
$		 Changes in
ownership interests
in subsidiaries
609
$ -

-
-
-
609
$		 Employee
stock options
346,814
$ -
-
-
-
346,814
$		 Others
-
$ -
-
-
378
378
$		 Total
23,400,002
$ 83,417
10,784

96,319

378
23,590,900
$

Pursuant to the R.O.C. Company Act, capital surplus arising from paid-in capital in excess of par value on issuance of common stocks and donations can be used to cover accumulated deficit or to issue new stocks or cash to shareholders in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Act requires that the amount of capital surplus to be capitalized mentioned above should not exceed 10% of the paidin capital each year. Capital surplus should not be used to cover accumulated deficit unless the legal reserve is insufficient.

(21) Retained earnings

  • A. Under the Company’s Articles of Incorporation, the current year’s earnings, if any, shall first be used to pay all taxes and offset prior years’ accumulated deficit and then 10% of the remaining amount shall be set aside as legal reserve. Special reserve shall also be set aside or reversed pursuant to the regulations. Appropriation of the remainder along with prior year’s accumulated unappropriated retained earnings shall be proposed by the Board of Directors, and shall be resolved by the stockholders when they are appropriated by issuing new shares. If the appropriation of retained earnings was appropriated in the form of cash, the appropriation should be in line with Article 240-5 of the Company Act, as resolved by a majority vote at a meeting of Board of Directors attended by two-thirds of the total number of directors, and reported to the shareholders’ meeting.

  • B. Earnings appropriation ratio and cash dividends ratio are decided by the Board of Directors, taking into account the Company’s financial structure, future capital requirements and profitability, and cash dividends shall account for at least 10% of the total dividends appropriated.

~42~

  • C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.

  • In line with Article 241 of the Company Act, all or part of the legal reserve and capital reserve could be appropriated as cash dividends as resolved by a majority vote at a meeting of Board of Directors attended by two-thirds of the total number of directors, and reported to the shareholders’ meeting.

  • D. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.

  • E. The appropriation of 2020 and 2019 earnings had been resolved at the shareholders’ meeting on July 16, 2021 and May 28, 2020. Details are summarized below:

For the year ended December 31, 2020 For the year ended December 31, 2019

Legal reserve
Reversal of special
reserve
Cash dividend
Stock dividend
Total		 Dividend per share
Dividend per share
Amount
(in dollars)
Amount
(in dollars)
293,325
$ 283,976
$ -
12,265)
(
1,206,557
1.0
$ 1,077,283
1.0
$ -
-

1,292,739
1.2
1,499,882
$ 1.0
$ 2,641,733
$ 2.2
$
  • F. The amount of cash dividends distributed under the appropriation of 2020 and 2019 earnings had been resolved at the Board of Directors’ meeting on March 8, 2021 and February 27, 2020, respectively, and reported to the shareholders’ meeting.

~43~

(22) Other equity items

2021

2021
Unrealised
gains (losses) Currency
on valuation translation Total
At January 1 $ 3,546,733
 ($ 1,803,450)
 $ 1,743,283
Reclassified to profit or loss
upon disposal
- Group - 346,341 346,341
Reclassified to retained earnings
upon disposal
- Group 5,849
 - 5,849
- Associates ( 9,631)
 - ( 9,631)
Revaluation
- Group ( 2,030,463)
 - ( 2,030,463)
- Associates 20,254 -
 20,254
Currency translation differences:
- Group - ( 844,374)
 ( 844,374)
- Associates - 53,467 53,467
At September 30 $ 1,532,742 ($ 2,248,016) ($ 715,274)
2020
Unrealised
gains (losses) Currency
on valuation translation Total
At January 1 $ 1,753,427
 ($ 1,081,728)
 $ 671,699
Reclassified to profit or loss
upon disposal
- Group - 4,817 4,817
Reclassified to retained earnings
upon disposal
- Group 8,058 - 8,058
- Associates ( 23,959)
 - ( 23,959)
Revaluation
- Group 860,367 - 860,367
- Associates 133,476 - 133,476
Currency translation differences:
- Group - ( 565,307)
 ( 565,307)
- Associates - ( 98,285) ( 98,285)
At September 30 $ 2,731,369 ($ 1,740,503) $ 990,866

~44~

(23) Operating revenue

Operating revenue
For the three months ended For the three months ended
September 30,2021 September 30,2020
Revenue from contracts with customers $ 9,283,416
 $ 11,852,050
For the nine months ended For the nine months ended
September 30,2021 September 30,2020
Revenue from contracts with customers $ 32,753,656 $ 31,119,390
A. Disaggregation of revenue from contracts with customers
For the three months ended For the three months ended
September 30,2021 September 30,2020
Cloud computing product $ 7,178,166
 $ 9,609,676
Automotive electronics and AIoT
product 1,123,599 1,190,231
Others 981,651 1,052,143
$ 9,283,416 $ 11,852,050
For the nine months ended For the nine months ended
September 30,2021 September 30, 2020
Cloud computing product $ 26,585,243
 $ 24,911,048
Automotive electronics and AIoT
product 3,393,719
 3,557,349
Others 2,774,694
 2,650,993
$ 32,753,656
 $ 31,119,390

B. Contract liabilities

The Group has recognised the following revenue-related contract liabilities:

Contract liabilities
– sales of goods
Contract liabilities
– others		 September 30,2021
370,095
$ 4,898
374,993
$		 December 31,2020
122,771
$ 5,095
127,866
$		 September 30,2020
107,192
$ 8,542
115,734
$

~45~

(24) Interest income

Interest income from bank deposits Interest income from financial assets measured at amortised cost Total

For the three months ended For the three months ended
September 30,2021 September 30,2020
$ 14,883
 7,177
$
52 673
$ 14,935
 7,850
$
For the nine months ended
September 30, 2021
Interest income from bank deposits
38,271
$ Interest income from financial assets
measured at amortised cost
625

Total
38,896
$		 For the nine months ended
September 30, 2020
30,867
$ 2,795
33,662
$

(25) Other income

Other income
Rent revenue
Dividend income
Other income
Total
Rent revenue
Dividend income
Other income
Total		 For the three months ended
September 30,2021
28,255
$ 112,219
47,531
188,005
$ For the nine months ended
September 30,2021
83,147
$ 296,240
176,946
556,333
$		 For the three months ended
September 30,2020
27,172
$ 144,551
13,467
185,190
$
For the nine months ended
September 30,2020
76,364
$ 212,469
50,113
338,946
$

(26) Other gains and losses

Other gains and losses
For the three months ended For the three months ended
September 30,2021 September 30,2020
Gains (losses) on disposals of property, $ 400
 ($ 17)
plant and equipment
Gains (losses) on disposal of investments 12,814,322 ( 4,229)
Gains on disposal of non-current assets
held for sale 298,437 -
Net currency exchange gains 21,308 174
(Losses) gains on financial assets/liabilities
at fair value through profit or losses ( 8,363)
 12,785
Other losses ( 14,857) ( 34,195)
Total $ 13,111,247 ($ 25,482)

~46~

For the nine months ended For the nine months ended September 30, 2021 September 30, 2020

Gains on disposals of property, plant and
equipment $ 2,003
 $ 1,185
Gains (losses) on disposal of investments 13,812,619
 ( 4,817)
Gains on disposal of non-current assets
held for sale 1,044,185 -
Net currency exchange gains 15,250
 37,628
Gains on financial assets/liabilities at
fair value through profit or losses 7,957 20,879
Other losses ( 32,975) ( 54,211)
Total $ 14,849,039
 $ 664

(27) Financial costs

Interest expense on bank borrowings Interest expense on lease liabilities

Interest expense on bank borrowings Interest expense on lease liabilities

For the three months ended
September 30,2021
2,236
$ 826
3,062
$ For the nine months ended
September 30,2021
15,983
$ 2,617
18,600
$		 For the three months ended
September 30, 2020
6,172
$ 676
6,848
$
For the nine months ended
September 30,2020
34,410
$ 3,179
37,589
$

(28) Expense by nature

Expense by nature
Employee benefit expense
Depreciation charges on property, plant
and equipment, investment property
and right-of-use assets
Amortization charges
Total
Employee benefit expense
Depreciation charges on property, plant
and equipment, investment property
and right-of-use assets
Amortization charges
Total		 For the three months ended
September 30,2021
1,331,080
$ 242,934
24,366
1,598,380
$ For the nine months ended
September 30,2021
4,052,333
$ 707,988
71,288
4,831,609
$		 For the three months ended
September 30,2020
1,381,786
$ 226,194
21,673
1,629,653
$
For the nine months ended
September 30,2020
4,178,541
$ 674,441
66,826
4,919,808
$

~47~

(29) Employee benefit expenses


Wages and salaries
Labor and health insurance fees
Pension costs
Other personnel expenses		 For the three months ended For the three months ended
September 30,2021
September 30,2020
1,161,650
$ 1,248,218
$ 72,066
57,552
58,165
32,281
39,199
43,735
1,331,080
$ 1,381,786
$
Wages and salaries
Labor and health insurance fees
Pension costs
Other personnel expenses		 For the nine months ended
September 30,2021
3,538,264
$ 217,255

166,891
129,923
4,052,333
$		 For the nine months ended
September 30,2020
3,710,937
$ 222,096
118,986
126,522
4,178,541
$

  • A. According to the amended Articles of Incorporation, the profit (pre-tax profit before deduction of employees’ compensation and directors’ remuneration) of the current year shall be distributed as employees’ compensation and directors’ remuneration, which will be resolved by the Board of Directors. The ratio shall not be lower than 0.1% for employees and not be higher than 1% for directors. If a company has an accumulated deficit, earnings should be reserved to cover losses. Employees’ compensation can be distributed by stock or dividends, and employees must be working for the Company. The Chairman of the Board is authorised to set the qualification requirements.

  • B. For the nine months ended September 30, 2021 and 2020, employees’ compensation was accrued at 0.1% of gain on pre-tax profit before deduction of employees’ compensation and directors’ remuneration. Directors’ remuneration were accrued under 1% of gain on pre-tax profit before deduction of employees’ compensation and directors’ remuneration.

  • C. For the three months and nine months ended September 30, 2021 and 2020, employees’ compensation were accrued at $7,886, $935, $11,520 and $2,040, respectively; and directors’ remuneration were accrued at $1,248, $1,248, $3,744 and $3,744, respectively.

  • The aforementioned amounts were recognised in salary expenses. Employees’ cash bonus and directors’ remuneration of 2020 and 2019 as resolved at the Board of Directors of the Company were in agreement with those amounts recognised in the 2020 and 2019 consolidated financial statements.

  • D. Information about employees’ compensation and directors’ remuneration of the Company as resolved by the Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

~48~

(30) Income tax

A. Income tax expense

Components of income tax expense:

ome tax
Income tax expense
Components of income tax expense:
For the three months ended For the three months ended
September 30,2021 September 30,2020
Current tax:
Current tax on profits for the period $ 40,239
 $ 56,723
Tax on undistributed surplus earnings 71,668
 -
Prior year income tax overestimation ( 1,098)
 ( 2,319)
Total current tax 110,809
 54,404
Deferred tax:
Origination and reversal of temporary
differences 6,073,192 ( 13,810)
Total deferred tax 6,073,192 ( 13,810)
Income tax expense $ 6,184,001 $ 40,594
For the nine months ended For the nine months ended
September 30,2021 September 30, 2020
Current tax:
Current tax on profits for the period $ 345,652
 $ 123,401
Tax on undistributed surplus earnings 71,668 9,901
Prior year income tax overestimation ( 56,170) ( 8,645)
Total current tax 361,150 124,657
Deferred tax:
Origination and reversal of temporary
differences 6,278,036 ( 8,439)
Total deferred tax 6,278,036 ( 8,439)
Income tax expense $ 6,639,186
 $ 116,218
  • B. The Company’s income tax returns through 2016 have been assessed and approved by the Tax Authority.

C. In 2021, the Group adjusted the dividend policy of the subgroup, Silver Star Developments Ltd. The surplus earnings might be remitted in the subsequent years. Thus, the Group recognised deferred tax liabilities amounting to $6,265,643 in 2021.

~49~

(31) Earnings per share

Earnings per share Earnings per share Earnings per share
Weighted average
number of ordinary
Amount
shares outstanding
Earnings per share
Basic earnings per share
after tax
(shares in thousands)
(in dollars)
Profit attributable to ordinary shareholders
of the parent
7,797,334
$ 1,195,178

6.52
$ Diluted earnings per share
Profit attributable to ordinary shareholders
of the parent
7,797,334
$ Less: Effect of dilutive potential common
stocks issued by investee companies
10,768)
(
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation
-
402
Net income attributable to common
stockholders plus dilutive effect of
common stock equivalents
7,786,566
$ 1,195,580

6.51
$ For the three months ended September 30,2021
Weighted average
number of ordinary
Amount
shares outstanding
Earnings per share
Basic earnings per share
after tax
(shares in thousands)
(in dollars)
Profit attributable to ordinary shareholders
of the parent
909,339
$ 1,195,178
0.76
$ Diluted earnings per share
Profit attributable to ordinary shareholders
of the parent
909,339
$ Less: Effect of dilutive potential common
stocks issued by investee companies
6,048)
(
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation
-
71
Net income attributable to common
stockholders plus dilutive effect of
common stock equivalents
903,291
$ 1,195,249
0.76
$ For the three months ended September 30,2020
Weighted average
number of ordinary
shares outstanding
(shares in thousands)
1,195,178
71
1,195,249		 Earnings per share
(in dollars)
0.76
$
0.76
$

~50~

Weighted average
number of ordinary
Amount
shares outstanding
Earnings per share
Basic earnings per share
after tax
(shares in thousands)
(in dollars)
Profit attributable to ordinary shareholders
of the parent
11,422,247
$ 1,195,178

9.56
$ Diluted earnings per share
Profit attributable to ordinary shareholders
of the parent
11,422,247
$ Less: Effect of dilutive potential common
stocks issued by investee companies
52,418)
(
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation
-
426
Net income attributable to common
stockholders plus dilutive effect of
common stock equivalents
11,369,829
$ 1,195,604
$ 9.51
$ For the nine months ended September 30,2021
Weighted average
number of ordinary
Amount
shares outstanding
Earnings per share
Basic earnings per share
after tax
(shares in thousands)
(in dollars)
Profit attributable to ordinary shareholders
of the parent
2,007,700
$ 1,193,140
1.68
$ Diluted earnings per share
Profit attributable to ordinary shareholders
of the parent
2,007,700
$ Less: Effect of dilutive potential common
stocks issued by investee companies
16,883)
(
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation
-
90
Net income attributable to common
stockholders plus dilutive effect of
common stock equivalents
1,990,817
$ 1,193,230
$ 1.67
$ For the nine months ended September 30,2020		 Weighted average
number of ordinary
Amount
shares outstanding
Earnings per share
Basic earnings per share
after tax
(shares in thousands)
(in dollars)
Profit attributable to ordinary shareholders
of the parent
11,422,247
$ 1,195,178

9.56
$ Diluted earnings per share
Profit attributable to ordinary shareholders
of the parent
11,422,247
$ Less: Effect of dilutive potential common
stocks issued by investee companies
52,418)
(
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation
-
426
Net income attributable to common
stockholders plus dilutive effect of
common stock equivalents
11,369,829
$ 1,195,604
$ 9.51
$ For the nine months ended September 30,2021
Weighted average
number of ordinary
Amount
shares outstanding
Earnings per share
Basic earnings per share
after tax
(shares in thousands)
(in dollars)
Profit attributable to ordinary shareholders
of the parent
2,007,700
$ 1,193,140
1.68
$ Diluted earnings per share
Profit attributable to ordinary shareholders
of the parent
2,007,700
$ Less: Effect of dilutive potential common
stocks issued by investee companies
16,883)
(
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation
-
90
Net income attributable to common
stockholders plus dilutive effect of
common stock equivalents
1,990,817
$ 1,193,230
$ 1.67
$ For the nine months ended September 30,2020		 Weighted average
number of ordinary
Amount
shares outstanding
Earnings per share
Basic earnings per share
after tax
(shares in thousands)
(in dollars)
Profit attributable to ordinary shareholders
of the parent
11,422,247
$ 1,195,178

9.56
$ Diluted earnings per share
Profit attributable to ordinary shareholders
of the parent
11,422,247
$ Less: Effect of dilutive potential common
stocks issued by investee companies
52,418)
(
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation
-
426
Net income attributable to common
stockholders plus dilutive effect of
common stock equivalents
11,369,829
$ 1,195,604
$ 9.51
$ For the nine months ended September 30,2021
Weighted average
number of ordinary
Amount
shares outstanding
Earnings per share
Basic earnings per share
after tax
(shares in thousands)
(in dollars)
Profit attributable to ordinary shareholders
of the parent
2,007,700
$ 1,193,140
1.68
$ Diluted earnings per share
Profit attributable to ordinary shareholders
of the parent
2,007,700
$ Less: Effect of dilutive potential common
stocks issued by investee companies
16,883)
(
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation
-
90
Net income attributable to common
stockholders plus dilutive effect of
common stock equivalents
1,990,817
$ 1,193,230
$ 1.67
$ For the nine months ended September 30,2020
Weighted average
number of ordinary
shares outstanding
(shares in thousands)
1,193,140
90
1,193,230
$		 Earnings per share
(in dollars)
1.68
$
1.67
$

Basic earnings per share is calculated with the gain or loss attributable to the shareholders of the ordinary shares issued by the Company, divided with outstanding weighted average ordinary shares during the period, and deducted with weighted average treasury shares.

(32) Transactions with non-controlling interest

A. Cash capital increase raised by subsidiaries

The Group’s subsidiary, MiTAC Computing Technology Corp. and the non-controlling interest increased their investment in the subsidiary, Hyve Design Solutions Corporation, in January 2020 proportionally to their interests. The amount of $90,150 was invested by the non-controlling interest.

~51~

B. Proceeds from disposal of subsidiaries

According to the statement in Note 6(7)M, the Group’s subsidiary, MiTAC Computing Technology Corp. lost control over Hyve Design Solutions Corporation, and the non-controlling interest decreased by $33,330.

(33) Supplemental cash flow information

A. Financing activities with partial cash payments ：

For the nine months ended For the nine months ended For the nine months ended For the nine months ended
September 30, 2021 September 30, 2020
Declared cash dividends - the Company $ 1,206,557
 $ 1,077,283
Declared cash dividends - subsidiaries 831 4,463
attributed to non-controlling interests
Subsidiaries received cash dividends
paid by the parent company ( 11,379)
 ( 10,784)
Cash paid during the period $ 1,196,009 $ 1,070,962

B. The Group lost control over Hyve Design Solutions Corporation on August 19, 2020. The details

  • of assets and liabilities relating to the subsidiary are as follows:
of assets and liabilities relating to the subsidiary are as follows:
Cash
Accounts receivable
Other receivables
Prepayments
Property, plant and equipment
Intangible assets
Accounts payable to related parties
Other payables
Other current liabilities
Total net assets
Fair value of the Group’s retained equity on the date of loss of control
Book value of the non-controlling interest on the date of loss of control		 August 19, 2020
78,615
$ 107,066

2,743
4,776

30,926

835
25)
(
156,412)
(
1,864)
(
$ 66,660
33,330
33,330
66,660
$

~52~

(34) Changes in liabilities from financing activities

At January 1, 2021
Changes in cash flow
Impact of changes in
foreign exchange rate
Changes in other non-
cash items
At September 30, 2021		 Short-term
borrowings		 Guarantee
deposit received		 Lease liabilities Long-term
borrowings
(including
current
portion)		 Liabilities
from financing
activities-gross
1,443,851
$ 392,990
2,117)
(
-
1,834,724
$		 23,205
$ 5,701
257)
(
-
28,649
$		 231,208
$ 32,159)
(
3,096)
(
3,670
199,623
$		 910,634
$ 2,268
682)
(
-
912,220
$		 2,608,898
$ 368,800
6,152)
(
3,670
2,975,216
$
At January 1, 2020
Changes in cash flow
Impact of changes in
foreign exchange rate
Changes in other non-
cash items
At September 30, 2020		 Short-term
borrowings
Guarantee
deposit received
3,803,871
$ 23,645
$ 738,644)
(
3,336)
(
9,104)
(
110)
(
-
-
3,056,123
$ 20,199
$		 Lease liabilities Long-term
borrowings
(including
current
portion)		 Liabilities
from financing
activities-gross
189,228
$ 44,539)
(
544)
(
15,020
159,165
$		 791,561
$ 72,000
-

-
863,561
$		 4,808,305
$ 714,519)
(
9,758)
(
15,020

4,099,048
$

7. RELATED PARTY TRANSACTIONS

(1) Names of related parties and relationship

Names of related parties

Getac Holdings Corp. and subsidiaries Infopower Technologies Ltd. Loyal Fidelity Aerospace Co., Ltd. Synnex Technology International Corp. and subsidiaries Harbinger Venture Management Company Ltd. Lien Hwa Industrial Holdings Corp. and subsidiaries UPC Technology Corp. Shen-Tong Information Co.,Ltd and subsidiaries Hyve Design Solutions Corporation and subsidiaries Shen-Tong Construction & Development Co., Ltd.

TD Synnex Corp. and subsidiaries

Relationship with the Group

Associate Associate Associate

Common Chairman

Common Chairman Common Chairman Common Chairman The Group’s Chairman was this company’s director Associate (Note 1)

Associate

Associate (Note 2)

~53~

  • Note 1: It was formerly a subsidiary of the Group and became an associate of the Group since August 19, 2020.

  • Note 2: It was formerly an associate of the Group and became a non-related party of the Group since September 1, 2021 as the Group lost significant influence over it.

  • (2) Significant related party transactions and balances

A. Operating revenue:

  • (a)
Sales of goods:
-Associates-TD Synnex Corp.
and subsidiaries
-Associates-Others
-Other related parties
Subtotal
Sales of services:
-Associates-TD Synnex Corp.
and subsidiaries
-Associates-Others
-Other related parties
Subtotal
Total
Sales of goods:
-Associates-TD Synnex Corp.
and subsidiaries
-Associates-Others
-Other related parties
Subtotal
Sales of services:
-Associates-TD Synnex Corp.
and subsidiaries
-Associates-Others
-Other related parties
Subtotal
Total		 For the three months ended
September 30,2021
88,758
$ 16,698
2,698
108,154
24
6,263
7
6,294
114,448
$ For the nine months ended
September 30, 2021
495,237
$ 49,800
13,106

558,143
314
10,320
7
10,641
568,784
$		 For the three months ended
September 30,2020
422,417
$ 23,498
3,952
449,867
30
1,503
20
1,553
451,420
$
For the nine months ended
September 30,2020
1,250,743
$ 51,329
4,326
1,306,398
179,881
2,893
52
182,826
1,489,224
$
  • (b) The selling price to related parties is determined based on the economic environment and market competition in the region of the related party.

~54~

  • (c) The Group’s term of credit for related parties is the same with third party clients. The payment is generally due around 3 months after delivery.

B. Purchases:

(a)

Purchases of goods:
-Associates
-Other related parties -
Synnex Techonology
International Corp. and
subsidiaries
Total
Purchases of goods:
-Associates
-Other related parties -
Synnex Techonology
International Corp. and
subsidiaries
Total		 For the three months ended For the three months ended
September 30,2021
September 30,2020
11,340
$ 13,402
$ 91,161
57,126)
(
102,501
$ 43,724)
($ For the nine months ended
For the nine months ended
September 30,2021
September 30,2020
23,292
$ 50,901
$ 160,931
360,580
184,223
$ 411,481
$

  • (b) The purchase price from related parties cannot be compared with the prices to third parties due to differences in product specifications.

  • (c) The Group’s term of payment for related parties is generally due around 3 months after counterparty’s delivery.

~55~

C. Receivables from related parties:

Payables to related parties:
Accounts receivable:
-Associates-TD Synnex
Corp. and subsidiaries
-Associates-Others
-Other related parties
Subtotal
Other receivables - others:
-Associates-Getac
Holdings Corp. and
subsidiaries
-Associates-TD Synnex
Corp. and subsidiaries
-Associates-Others
-Other related parties
Subtotal
Total
Accounts payable:
-Associates
-Other related parties -
Synnex Technology
International Corp. and
subsidiaries
Subtotal
Other payables:
-Associates
-Other related parties
Subtotal
Total
September 30,2021
-
$ 454
2,709
3,163
13,067
-
2,810
2,384
18,261
21,424
$ September 30,2021
5,925
$ 102,878
108,803
6,656
1,136

7,792
116,595
$		 December 31,2020
215,717
$ 70
173
215,960
22,203
335
1,324
6,723
30,585

246,545
$ December 31,2020
6,483
$ 13,739
20,222
3,344
3,603
6,947
27,169
$		 September 30,2020
346,051
$ 423

3,837

350,311

22,063
929
4,160
2,447
29,599
379,910
$
September 30,2020
2,908
$ 40,881
43,789
7,960
1,322
9,282
53,071
$

D. Payables to related parties:

~56~

E. Property transactions:

Acquisition of property, plant and equipment:

Associates
Other related parties
Total
Associates
Other related parties
Total		 For the three months ended
September 30,2021
100
$ 1,474
1,574
$ For the nine months ended
September 30,2021
2,735
$ 2,605
5,340
$		 For the three months ended
September 30,2020
-
$ 771
771
$
For the nine months ended
September 30,2020
1,778
$ 1,012
2,790
$

  • －

  • F. Lease transactions leasee

  • (a) The Group leases buildings from Getac Technology Corp. and subsidiaries. Rental contracts are typically made for periods from years 2019 to 2023.

  • (b) Lease liabilities

    • (i) Outstanding balance:
September 30,2021
December 31, 2020
Associates
24,214
$
32,101
$		 September 30,2020
33,668
$

(ii) Interest expense

(ii) Interest expense
Lease transactions－lessor
Associates
Associates
Rent income
Associates
Other related parties
Total		 For the three months ended
September 30,2021
381
$ For the nine months ended
September 30, 2021
1,267
$ For the three months ended
September 30,2021
11,248
$ 382
11,630
$		 For the three months ended
September 30,2020
524
$
For the nine months ended
September 30,2020
1,676
$
For the three months ended
September 30,2020
10,239
$ 358
10,597
$

  • －

  • G. Lease transactions lessor

~57~

For the nine months ended For the nine months ended September 30, 2021 September 30, 2020

Rent income Associates Other related parties Total

$ 32,045
 $ 25,886
1,111
 1,066
$ 33,156 $ 26,952

H. Expenses

ey management compensation
Associates
Other related parties
Total
Associates
Other related parties
Total
laries and other short-term
mployee benefits
st-employment benefits
tal
laries and other short-term
mployee benefits
st-employment benefits
tal		 For the three months ended
September 30,2021
7,815
$ 118
7,933
$ For the nine months ended
September 30,2021
9,601
$ 1,041
10,642
$ For the three months ended
September 30,2021
6,948
$ 144
7,092
$ For the nine months ended
September 30,2021
36,499
$ 432
36,931
$		 For the three months ended
September 30,2020
6,954
$ 863
7,817
$ For the nine months ended
September 30,2020
79,677
$ 2,984
82,661
$ For the three months ended
September 30,2020
9,715
$ 142
9,857
$ For the nine months ended
September 30, 2020
40,967
$ 425
41,392
$		 For the three months ended
September 30,2020
6,954
$ 863
7,817
$
For the nine months ended
September 30,2020
79,677
$ 2,984
82,661
$

(3) Key management compensation

Salaries and other short-term employee benefits Post-employment benefits Total Salaries and other short-term employee benefits Post-employment benefits Total

~58~

8. PLEDGED ASSETS

The Group’s assets pledged as collateral are as follows:

Pledged asset
Time deposits (shown as "financial
assets at amortised cost- non-
current assets")

Time deposits (shown as "financial
assets at amortised cost- current
assets")

Time deposits (shown as "financial
assets at amortised cost- non-
current assets")
Time deposits (shown as "financial
assets at amortised cost- current
assets")		 Book Value September 30,2020
$ 10,166
8,687
25,000
-
43,853
$		 Purpose
September 30,2021
$ 10,120
-
33,610
312,974
356,704
$		 December 31,2020
$ 10,253
8,754
25,000
-
44,007
$
Guarantee deposit for lease
Customs guarantee
Guarantee deposit for letter of
guarantee for customs duties
Guarantees deposit for
borrowings

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED CONTRACT

COMMITMENTS

(1) Contingencies

None.

(2) Commitments

Capital expenditure contracted but not provided are as follows:

September 30, 2021 December 31, 2020 September 30, 2020 Property, plant and equipment $ - $ 60,288 $ 75,865

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

None.

12. OTHERS

(1) Capital management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital.

~59~

(2) Financial instruments

A. Financial instruments by category

Financial assets
Financial assets at fair value
through profit or loss
Financial assets mandatorily
measured at fair value through
profit or loss
Financial assets at fair value
through other comprehensive
income
Designation of equity instrument
Financial assets at amortised cost/
Loans and receivables
Cash and cash equivalents
Financial assets at amortised
cost
Notes receivable
Accounts receivable
Accounts receivable - related
parties
Other receivables
Guarantee deposits
Financial liabilities
Financial liabilities at fair value
through profit or loss
Financial liabilities held for
trading
Financial liabilities at amortised
cost
Short-term borrowings
Accounts payable
Accounts payable - related
parties
Other accounts payable
Guarantee deposits
Long-term borrowings
(including current portion)
Lease liabilities		 September 30,2021
December 31,2020

4,287
$ 6,107
$ 24,155,142
$ 7,298,592
$ 6,633,952
$ 5,805,297
$ 356,704
44,007
46,988
31,689
5,438,331
4,982,050
3,163
215,960
75,751
60,168
20,565
23,600
12,575,454
$ 11,162,771
$ 1,850
$ 11,691
$ 1,834,724
$ 1,443,851
$ 6,681,720
6,662,560
108,803
20,222
3,529,052
3,366,781
28,649
23,205
912,220
910,634
13,095,168
$ 12,427,253
$ 199,623
$ 231,208
$		 September 30,2020
43,405
$ 6,511,679
$ 4,349,646
$ 176,192
84,210
6,135,104
350,311
55,482
25,389
11,176,334
$ 9,274
$ 3,056,123
$ 5,079,634
43,789
3,410,950
20,199
863,561
12,474,256
$ 159,165
$

~60~

  • B. Financial risk management policies

  • There was no significant change in the reporting period. Please refer to Note 12 in the consolidated financial statements for the year ended December 31, 2020.

  • C. Significant financial risks and degrees of financial risks

  • (a)Market risk

Foreign exchange risk

  • i. The Group’s businesses involve some non-functional currency operations (the Company’s and certain subsidiaries’ functional currency: NTD; other certain subsidiaries’ functional currency: USD, EUR, AUD, JPY and CNY). The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations are as follows:
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD:NTD
AUD:NTD
USD:CNY
Non-monetary items
CNY:USD
Financial liabilities
Monetary items
USD:NTD
AUD:NTD
JPY:NTD
USD:CNY		 September 30,2021 September 30,2021
Foreign curency
amount
(In thousands)
449,481
$ 5,571
76,597
85,597
452,383
5,700
888,959
216,413		 Exchange
rate
27.850
20.070
6.469
0.155
27.850
20.070
0.249
6.469		 Book value
(NTD)
12,518,050
$ 111,818
2,133,218
368,493
12,598,866
114,405
221,351
6,027,093




~61~

(Foreign currency:
functional currency)
Financial assets
Monetary items
USD:NTD
USD:CNY
Non-monetary items
CNY:USD
Financial liabilities
Monetary items
USD:NTD
USD:CNY
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD:NTD
USD:CNY
Non-monetary items
CNY:USD
Financial liabilities
Monetary items
USD:NTD
USD:CNY		 Foreign curency
amount
Exchange
(In thousands)
rate
420,414
$ 28.480
127,552
6.507
80,935
0.154
462,736
28.480
154,042
6.507
December 31,2020
September 30, 2020		 Foreign curency
amount
Exchange
(In thousands)
rate
420,414
$ 28.480
127,552
6.507
80,935
0.154
462,736
28.480
154,042
6.507
December 31,2020
September 30, 2020		 Book value
(NTD)
11,973,379
$ 3,632,690
354,254
13,178,719
4,387,124
Foreign curency
amount
(In thousands)
518,094
$ 93,972
78,852
577,144
145,817		 Exchange
rate
29.100
6.817
0.147
29.100
6.817		 Book value
(NTD)
15,076,550
$ 2,734,571
336,621
16,794,891
4,243,287


ii. Total exchange gain, including realized and unrealized, arising from significant foreign exchange variation on the monetary items held by the Group for the three months and nine months ended September 30, 2021 and 2020, amounted to $21,308, $174, $15,250 and $37,628 , respectively.

iii. When the exchange rates for USD, AUD, EUR, JPD and CNY to NTD and USD to CNY increased or decreased by 1%, with all other factors the same at September 30, 2021 and 2020, net loss before tax would increase or decrease by ($41,986) and ($32,271) for the nine months ended September 30, 2021 and 2020, respectively.

~62~

Price risk

  • i. The Group’s equity securities, which are exposed to price risk, are the held financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income. To manage its price risk arising from investments in equity securities, the Group diversifies its portfolio.

  • ii. The Group’s investments in equity securities comprise shares and open-end funds issued by the domestic or foreign companies. The prices of equity securities would change due to the change of the future value of investee companies. If the prices of these equity securities had increased/decreased by 1% with all other variables held constant, post-tax profit for the nine months ended September 30, 2021 and 2020. Other components of equity would have increased/decreased by $241,551 and $65,117, respectively, as a result of other comprehensive income classified as equity investment at fair value through other comprehensive income.

  • Cash flow and fair value interest rate risk

  • i. The Group’s main interest rate risk arises from long-term and short-term borrowings with variable rates, which expose the Group to cash flow interest rate risk. For the nine months ended September 30, 2021 and 2020, the Group’s borrowings at variable rate were mainly denominated in New Taiwan dollars and US Dollars.

  • ii. If the borrowing interest rate had increased/decreased by 0.01% with all other variables held constant, profit, net of tax for the nine months ended September 30, 2021 and 2020 would have decreased /increased by $206 and $294, respectively. The main factor is that changes in interest expense result in floating-rate borrowings.

  • (b)Credit risk

  • i. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments on the contract obligations. The main factor is that counterparties could not repay in full the accounts receivable based on the agreed terms, and the contract cash flows stated at amortised cost.

  • ii. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analysing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors.

  • iii. Individual risk limits are set based on internal or external factors in accordance with limits set by credit control manager. The utilisation of credit limits is regularly monitored.

  • iv. For banks and financial institutions, only the institutions with good credit quality are accepted as counterparties.

  • v. The default occurs when it expects that the contact payments cannot be recovered and are transferred to overdue receivables.

~63~

  • vi. The following indicators are used to determine whether the credit impairment of debt instruments has occurred:

  • (i) It becomes probable that the issuer will enter bankruptcy or other financial

    • reorganization due to their financial difficulties;

  • (ii) The disappearance of an active market for that financial asset because of financial difficulties;

  • (iii) Default or delinquency in interest or principal repayments;

  • (iv) Adverse changes in national or regional economic conditions that are expected to cause a default.

  • vii. The Group classifies customers’ repayment ability in accordance with the contract term and macroeconomic forecast included in the forecastability and related industry information. The Group applies the modified approach using group methodology to estimate expected credit loss.

  • viii. The Group wrote-off the financial assets, which cannot be reasonably expected to be recovered, after initiating recourse procedures. However, the Group will continue executing the recourse procedures to secure their rights.

  • ix.The Group considered the forecastability to adjust historical and timely information to assess the default possibility of accounts receivable. As of September 30, 2021, December 31, 2020 and September 30, 2020, the loss rate methodology is as follows:

September 30,2021
Expected loss rate
Value
Allowance
December 31,2020
Expected loss rate
Value
Allowance
September 30,2020
Expected loss rate
Value
Allowance		 GroupA
0% - 100%
438,930
$ 89,167
GroupA
10% - 100%
454,571
$ 85,151
GroupA
10% - 100%
426,989
$ 82,118		 GroupB
0.012% - 0.7%
5,092,859
$ 1,128
GroupB
0.012% - 0.7%
4,834,921
$ 6,331
GroupB
0.014% - 0.7%
6,150,077
$ 9,533		 Total
5,531,789
$ 90,295
Total
5,289,492
$ 91,482
Total
6,577,066
$ 91,651

Group A: High-risk accounts: The evaluation module is based on payment records, financial indicators, contract fulfillment status, and related industry information. Group B: Low- and medium-risk accounts: Entities provide good payment records, strong prospects, transparent financials or collateral.

~64~

  • x. Movements in relation to the Group applying the modified approach to provide loss allowance for accounts receivable is as follows:
2021
At January 1 $ 91,482
Provision for impairment 525
Write-offs ( 840)
Effect of foreign exchange ( 872)
At September 30 $ 90,295
2020
At January 1 $ 77,034
Provision for impairment 15,268
Write-offs ( 317)
Effect of foreign exchange ( 334)
At September 30 $ 91,651

(c)Liquidity risk

  • i. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group treasury. Group treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs.

  • ii. The table below analyses the Group’s non-derivative financial liabilities and net-settled or gross-settled derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date for nonderivative financial liabilities and to the expected maturity date for derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows. Non-derivative financial liabilities:

September 30,2021
Short-term borrowings
Accounts payable
Other payables
Lease liabilities
Guarantee deposits
Long-term borrowings		 Less than
1year
1,835,338
$ 6,790,523
3,529,052
40,836
11,809
212,126		 Between 1
and 2years
-
$ -
-
28,736
6,259
253,049		 Between 2
and 3years
-
$ -
-
35,242

2,604
271,047		 Over
3years
-
$ -
-
113,928
7,977
186,136

~65~

December 31,2020
Short-term borrowings
Accounts payable
Other payables
Lease liabilities
Guarantee deposits
Long-term borrowings
September 30, 2020
Short-term borrowings
Accounts payable
Other payables
Lease liabilities
Guarantee deposits
Long-term borrowings		 Less than
1year
1,444,893
$ 6,682,782
3,366,781
38,661
8,257
52,075
Less than
1year
3,059,658
$ 5,123,423
3,410,950
26,349
3,202
4,261
 Between 1
and 2years
-
$ -
-
37,419
2,911
261,139
Between 1
and 2 years
-
$ -

-
20,818
4,938
202,980		 Between 2
and 3years
-
$ -
-
35,154
6,615
249,203
Between 2
and 3years
-
$ -
-
18,498
5,006

243,140		 Over
3years
-
$ -
-
132,940
5,422
361,425
Over
3years
-
$ -
-

104,072
7,053
426,843

Derivative financial liabilities

As September 30, 2021, December 31, 2020 and September 30, 2020, the Group’s derivative financial liabilities mature within one year.

  • iii.The Group does not expect the timing of occurrence of the cash flows estimated through the maturity date analysis will be significantly earlier, nor expect the actual cash flow amount will be significantly different.

(3) Fair value information

  • A. The different levels that the inputs to valuation techniques are used to measure fair value of financial instruments have been defined as follows:

  • Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

  • Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices).

  • Level 3: Inputs for the asset or liability that are not based on observable market data.

  • B. Fair value information of investment property at cost is provided in Note 6(11).

  • C. Financial instruments not measured at fair value

  • Including the carrying amounts of cash and cash equivalents, financial assets at amortised cost, notes receivable, accounts receivable, other receivables, refundable deposits, short-term borrowings, notes payable, accounts payable, other payables, long-term borrowings and guarantee deposits received are approximate to their fair values.

  • D. The related information of financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities are as follows:

~66~

(a) The related information of natures of the assets and liabilities is as follows:

September 30, 2021
Level 1
Recurring fair value measurements
Financial assets:
Forward exchange contracts
-
$ Equity securities
20,306,504
Total
20,306,504
$ Recurring fair value measurements
Financial liabilities:
Forward exchange contracts
-
$ December 31, 2020
Level 1
Recurring fair value measurements
Financial assets:
Forward exchange contracts
-
$ Equity securities
3,892,858
Total
3,892,858
$ Recurring fair value measurements
Financial liabilities:
Forward exchange contracts
-
$ September 30, 2020
Level 1
Recurring fair value measurements
Financial assets:
Forward exchange contracts
-
$ Equity securities
3,440,610
Total
3,440,610
$ Recurring fair value measurements
Financial liabilities:
Forward exchange contracts
-
$		 Level 2
4,287
$ 338,782
343,069
$ 1,850
$ Level 2
6,107
$ 283,970
290,077
$ 11,691
$ Level 2
43,405
$ 254,082
297,487
$ 9,274
$		 Level 3
-
$ 3,509,856
3,509,856
$ -
$ Level 3
-
$ 3,121,764
3,121,764
$ -
$ Level 3
-
$ 2,816,987
2,816,987
$ -
$		 Total
4,287
$ 24,155,142
24,159,429
$
1,850
$
Total
6,107
$ 7,298,592
7,304,699
$
11,691
$
Total
43,405
$ 6,511,679
6,555,084
$
9,274
$

Financial liabilities:
Forward exchange contracts

  • (b) The methods and assumptions the Group used to measure fair value are as follows:

  • i. The instruments the Group used market quoted prices as their fair values (that is, Level 1) are listed below by characteristics:

Listed shares Open-end fund Market quoted price Closing price Net worth

~67~

  • ii. Except for financial instruments with active markets, the fair value of other financial instruments is measured by using valuation techniques or by reference to counterparty quotes.

  • iii. When assessing non-standard and low-complexity financial instruments, the Group adopts valuation technique that is widely used by market participants. The inputs used in the valuation method to measure these financial instruments are normally observable in the market.

  • iv. The valuation of derivative financial instruments is based on valuation model widely accepted by market participants, such as present value techniques and option pricing models. Forward exchange contracts are usually valued based on the current forward exchange rate.

  • v. The output of valuation model is an estimated value and the valuation technique may not be able to capture all relevant factors of the Group’s financial and non-financial instruments. Therefore, the estimated value derived using valuation model is adjusted accordingly with additional inputs, for example, model risk or liquidity risk and etc. In accordance with the Group’s management policies and relevant control procedures relating to the valuation models used for fair value measurement, management believes adjustment to valuation is necessary in order to reasonably represent the fair value of financial and non-financial instruments at the consolidated balance sheet. The inputs and pricing information used during valuation are carefully assessed and adjusted based on current market conditions.

  • vi. The Group takes into account adjustments for credit risk to measure the fair value of financial and non-financial instruments to reflect credit risk of the counterparty and the Group’s credit quality.

  • E. For the nine months ended September 30, 2021 and 2020, there was no transfer between Level 1 and Level 2.

  • F. The following table presents the changes in Level 3 instruments as at September 30, 2021 and 2020:

Equity securities

January 1
Proceeds from capital reduction for
the period
Acquired in the period
Gains recognised in other
comprehensive income
Effects of foreign exchange
September 30		 2021
2020
3,121,764
$ 2,485,297
$ -
12,303)
(
55,440
13,500
250,981
331,384
81,711
891)
(
3,509,896
$ 2,816,987
$

~68~

  • G. Investment department is in charge of valuation procedures for fair value measurements being categorized within Level 3, which is to verify independent fair value of financial instruments. Such assessment is to ensure the valuation results are reasonable by applying independent information to make results close to current market conditions, and reviewing the information periodically.

  • H. The following is the qualitative information of significant unobservable inputs and sensitivity analysis of changes significant unobservable inputs to valuation model used in Level 3 fair value measurements:

easurements:
Non-derivative
equityinstrument:
Unlisted shares
Non-derivative
equityinstrument:
Unlisted shares
Non-derivative
equityinstrument:
Unlisted shares		 Fair value at
September30,2021
$ 3,509,856
Fair value at
December 31, 2020
$ 3,121,764
Fair value at
September30,2020
$ 2,816,987		 Valuation
technique
Net asset
value
Valuation
technique
Net asset
value
Valuation
technique
Net asset
value		 Significant
unobservable input
Net asset value
Significant
unobservable input
Net asset value
Significant
unobservable input
Net asset value		 Range (weighted
average)
-
Range (weighted
average)		 Relationship of
inputs to fair value
The higher the net asset
value, the higher the
fair value.
Relationship of
inputs to fairvalue
The higher the net asset
value, the higher the
fair value.
Relationship of
inputs to fairvalue
-
Range (weighted
average)
- The higher the net asset
value, the higher the
fair value.
  • I. The Group has carefully assessed the valuation models and assumptions used to measure fair value; therefore, the fair value measurement is reasonable. However, use of different valuation models or assumptions may result in difference measurement. The following is the effect of profit or loss or of other comprehensive income from financial assets and liabilities categorized within Level 3 if the inputs used to valuation models have changed:
Financialassets
Input
Equity instrument
Net asset
value
Financialassets
Input
Equity instrument
Net asset
value		 Change
±1%
Change
±1%		 September30,2021 September30,2021 September30,2021
Recognisedin Unfavourable
change
-
$ profit or loss
December		 Recognised in other
comprehensiveincome
Favourable
change
-
$		 Favourable
change
35,099
$ 31,2020		 Unfavourable
change
35,099
$
Recognisedin Unfavourable
change
-
$ profit or loss		 comprehensiveincome
Recognised in other
Favourable
change
-
$		 Favourable
change
31,218
$		 Unfavourable
change
31,218
$

~69~

September 30, 2020

Financialassets
Input
Equity instrument
Net asset
value		 Change
±1%		 Recognisedin Unfavourable
change
-
$ profit or loss		 Recognised in other
comprehensiveincome		 Recognised in other
comprehensiveincome
Favourable
change
-
$		 Favourable
change
28,170
$		 Unfavourable
change
28,170
$

13. SUPPLEMENTARY DISCLOSURES

(1) Significant transactions information

  • A. Loans to others: Please refer to table 1.

  • B. Provision of endorsements and guarantees to others: Please refer to table 2.

  • C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 3.

  • D. Acquisition or sale of the same security with the accumulated cost exceeding NT$300 million or 20% of the Company’s paid-in capital: Please refer to table 4.

  • E. Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more: None.

  • F. Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: Please refer to table 5.

  • G. Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paidin capital or more: Please refer to table 6.

  • H. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more: Please refer to table 7.

  • I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Notes 6(2) and (15).

  • J. Significant inter-company transactions during the reporting periods: Please refer to table 8.

(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to table 9.

(3) Information on investments in Mainland China

  • A. Basic information: Please refer to table 10.

  • B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 6 and table 10.

(4) Major shareholders information

Major shareholders information: Please refer to table 11.

14. SEGMENT INFORMATION

(1) General information

Management has determined the reportable operating segments based on the reports reviewed by the Chief Operating Decision-Maker that are used to make strategic decisions. The Group’s Chief Operating Decision-Maker manages business from the perspectives of cloud computing product business group and automotive electronics and AIoT business group.

~70~

The Group’s company organization, basis of department segmentation and principles for measuring segment information for the period were not significantly changed.

(2) Information about segment profit or loss, assets and liabilities

The segment information provided to the Chief Operating Decision-Maker for the reportable segments and reconciliations are as follows:

For the nine months ended September 30, 2021

Automotive
Cloud computing electronics and
Item businessgroup AIoT businessgroup Others Total
Revenue 26,585,243
$		 $ 3,393,719
 $ 2,774,694
 $ 32,753,656
Segment gain (loss) 216,206 ( 53,812)
 ( 190,753)
 ( 28,359)

For the nine months ended September 30, 2020

Cloud computing
Item
business group
Revenue
24,911,048
$ Segment (loss) gain
154,972		 Automotive
electronics and
AIoT businessgroup
Others
3,557,349
$ 2,650,993
$ 83,547
48,884)
(		 Total
31,119,390
$ 189,635

(3) Reconciliation for segment income (loss)

The revenue from external customers reported to the Chief Operating Decision-Maker is measured in a manner consistent with that in the statement of comprehensive income. A reconciliation of reportable segment income or loss to the income/(loss) before tax from continuing operations for the nine months ended September 30, 2021 and 2020 is provided as follows:

For the For the
nine months ended nine months ended
Item September 30,2021 September 30, 2020
(Loss) income for reportable segments ($ 28,359)
 $ 189,635
Unallocated:
Share of profits and losses from affiliates 2,663,448 1,531,304
and joint ventures accounted for using
the equity method
Dividend revenue 296,240 212,469
Interest revenue 38,896 33,662
Net currency exchange gain 15,250 37,628
Gains (losses) on disposal of investments 13,812,619 ( 4,817)
Gains on disposals of non-current assets 1,044,185 -
held for sale
Other income 218,478 56,741
Income before tax from operations $ 18,060,757 2,056,622
$

~71~

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES Loans to others For the nine months ended September 30, 2021

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Loans to others
For the nine months ended September 30, 2021
Table 1 Expressed in thousands of NTD
(Except as otherwise indicated)
No.
（Note1）		 Creditor Borrower General ledger account Is a related
party		 Maximum
outstanding
balance during the
nine months ended
September 30,
2021		 Balance at
September 30,
2021		 Actual amount
drawn down		 Interest rate Nature of
loan
（Note 2）		 Amount of
transactions
with the
borrower		 Reason for short-
term financing		 Allowance
for doubtful
accounts		 Collateral Limit on loans
granted to a single
party
（Note 2）		 Ceiling on total
loans granted
（Note 3）
Item Value
0 MiTAC Holdings Corp. MiTAC International Corp. Other receivables-
related parties		 Y 2,000,000
$		 2,000,000
$		 $ - 0.56% 2 $ - Operations -
$		 None -
$		 4,576,916
$		 9,153,833
$
0 MiTAC Holdings Corp. MiTAC Computing Technology Corp.
Other receivables-
related parties		 Y 3,500,000 3,500,000 3,157,355 0.22%-0.45% 2 - Operations - None - 4,576,916 9,153,833
0 MiTAC Holdings Corp. MiTAC Digital Technology Corp.
Other receivables-
related parties		 Y 1,000,000 1,000,000 278,500 0.26%~0.39% 2 - Operations - None - 4,576,916 9,153,833
1 MiTAC International Corp. MiTAC Holdings Corp.
Other receivables-
related parties		 Y 1,000,000 1,000,000 180,000 0.47978%-0.6167% 2 - Operations - None - 4,222,065 8,444,131
1 MiTAC International Corp. MiTAC Computing Technology Corp.
Other receivables-
related parties		 Y 2,900,000 2,900,000 - 0.21%-0.27% 2 - Operations - None - 4,222,065 8,444,131
1 MiTAC International Corp. MiTAC Digital Technology Corp.
Other receivables-
related parties		 Y 2,000,000 1,000,000 - 0.22%-0.42% 2 - Operations - None - 4,222,065 8,444,131
1 MiTAC International Corp. Shen-Tong Construction & Development Co., ltd.
Other receivables-
related parties		 Y 1,427 1,427 1,427 0 2 - Operations - None - 4,222,065 8,444,131
2 MiTAC Computing Technology Corp. MiTAC Holdings Corp.
Other receivables-
related parties		 Y 1,420,000 1,420,000 1,420,000 0.6293%~0.4937296% 2 - Operations - None - 1,533,050 1,533,050
3 MiTAC Digital Technology Corp. MiTAC Holdings Corp.
Other receivables-
related parties		 Y 600,000 600,000 600,000 0.47978%-0.5337% 2 - Operations - None - 650,866 650,866
4 Silver Star Developments Ltd. MiTAC International Corp.
Other receivables-
related parties		 Y 2,064,440 - - 0 2 - Operations - None - 8,639,261 8,639,261
4 Silver Star Developments Ltd. MiTAC Holdings Corp.
Other receivables-
related parties		 Y 3,713,088 3,698,480 3,435,855 0 2 - Operations - None - 43,196,305 43,196,305
4 Silver Star Developments Ltd. Software Insights Ltd.
Other receivables-
related parties		 Y 28,390 - - 0 2 - Operations - None - 43,196,305 43,196,305
4 Silver Star Developments Ltd. Start Well Technology Ltd.
Other receivables-
related parties		 Y 873,171 852,210 852,210 0 2 - Operations - None - 43,196,305 43,196,305
4 Silver Star Developments Ltd. MiTAC Benelux N.V.
Other receivables-
related parties		 Y 79,051 74,336 67,872 0 2 - Operations - None - 43,196,305 43,196,305
5 Tyan Computer Corp.(USA) Mitac Information Systems Corp.
Other receivables-
related parties		 Y 214,013 208,875 208,875 2.83% 2 - Operations - None - 1,080,919 1,080,919
6 MiTAC Investment Holding Ltd. MiTAC Technology (KunShan) Co., Ltd.
Other receivables-
related parties		 Y 43,840 43,050 43,050 3.85% 2 - Operations - None - 6,109,538 6,109,538
6 MiTAC Investment Holding Ltd. MiTAC Information Systems (Kunshan) Co., Ltd.
Other receivables-
related parties		 Y 385,792 43,050 43,050 0%~4.3% 2 - Operations - None - 6,109,538 6,109,538 
Table 1,Page 1
No.
（Note1）		 Creditor Borrower General ledger account Is a related
party		 Maximum
outstanding
balance during the
nine months ended
September 30,
2021		 Balance at
September 30,
2021		 Actual amount
drawn down		 Interest rate Nature of
loan
（Note 2）		 Amount of
transactions
with the
borrower		 Reason for short-
term financing		 Allowance
for doubtful
accounts		 Collateral Collateral Limit on loans
granted to a single
party
（Note 2）		 Ceiling on total
loans granted
（Note 3）
Item Value
7 MiTAC Research (ShangHai) Ltd. MiTAC Investment Holding Ltd. Other receivables-
related parties		 Y 276,192
$		 -
$		 -
$		 0 2 - Operations -
$		 None -
$		 934,110
$		 934,110
$
7 MiTAC Research (ShangHai) Ltd. MiTAC Information Systems (Kunshan) Co., Ltd.
Other receivables-
related parties		 Y 273,735 271,215 271,215 0%~4.3% 2 - Operations - None - 934,110 934,110
8 Access Wisdom Holdings Ltd. MiTAC Digital Technology Corp.
Other receivables-
relatedparties		 Y 31,389 30,635 30,635 0 2 - Operations - None - 39,819 39,819
9 Mio International Ltd. MiTAC Digital Technology Corp. Other receivables-
related parties		 Y 19,975 19,495 19,495 0 2 - Operations - None - 20,176 20,176
9 Mio International Ltd. Access Wisdom Holdings Ltd.
Other receivables-
related parties		 Y 19,975 19,495 19,495 0 2 - Operations - None - 100,881 100,881
10 MiTAC Computer (Shunde) Corp. MiTAC Information Systems (Kunshan) Co., Ltd.
Other receivables-
related parties		 Y 272,223 - - 4.3% 2 - Operations - None - 5,634,346 5,634,346
11 MiTAC Computer (KunShan) Co., Ltd. MiTAC Information Systems (Kunshan) Co., Ltd.
Other receivables-
related parties		 Y 172,200 172,200 172,200 0%~3.85% 2 - Operations - None - 5,592,920 5,592,920

  • Note 1: The numbers filled in for the loans provided by the Company or subsidiaries are as follows:

  • (1) The Company is ‘0’.

  • (2) The subsidiaries are numbered in order starting from ‘1’.

  • Note 2: The nature of loan are as follows:

  • (1) Ongoing business

  • (2) Short-term financing

  • Note 3: (1) MiTAC Holdings Corp. (the Company)'s total borrowing amount of short-term financing should not exceed 20% of the net worth on the latest financial statements audited or reviewed by independent auditors. The borrowing amount for each borrowing company should not exceed 10% of the net worth of the Company.

  • (2) MiTAC International Corp. (the Company)'s total borrowing amount of short-term financing should not exceed 20% of the net worth on the latest financial statements audited or reviewed by independent auditors. The borrowing amount for each borrowing company should not exceed 10% of the net worth of the Company.

  • (3) MiTAC Computing Technology Corp.’s short-term financing limit should not exceed 40% of the net worth on the latest financial statements audited.

  • (4) MiTAC Digital Technology Corp.’s short-term financing limit should not exceed 40% of the net worth on the latest financial statements audited.

  • (5) If Silver Star Developments Ltd. was lending to foreign subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 200% of the net worth on the latest financial statements audited by independent auditors.

  • (6) If Silver Star Developments Ltd. was lending to domestic subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 40% of the net worth on the latest financial statements audited by independent auditors.

  • (7) The borrowing amount and the total borrowing amount of Tyan Computer Corp. (USA) lending to the ultimate parent company's direct and indirect wholly-owned foreign subsidiaries should not exceed 200% of the net worth on the latest financial statements audited by independent auditors.

  • (8) If MiTAC Investment Holdings Ltd. was lending to foreign subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 200% of the net worth on the latest financial statements audited by independent auditors.

  • (9) If MiTAC Research (Shanghai) Ltd. was lending to foreign subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 200% of the net worth on the latest financial statements audited by independent auditors.

  • (10) If Access Wisdom Holdings Ltd. was lending to domestic subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 40% of the net worth on the latest financial statements audited by independent auditors.

(11) If Mio International Ltd. was lending to foreign subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 200% of the net worth on the latest financial statements audited by independent auditors.

(12) If Mio International Ltd. was lending to domestic subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 40% of the net worth on the latest financial statements audited by independent auditors.

  • (13) If MiTAC Computer (Shunde) Corp. was lending to foreign subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 200% of the net worth on the latest financial statements audited by independent auditors.

(14) If MiTAC Computer (KunShan) Co., Ltd. was lending to foreign subsidiaries owned 100% directly and indirectly by the ultimate parent company, the borrowing amount to each borrowing company and the total borrowing amount should not be higher than 200% of the net worth on the latest financial statements audited by independent auditors. 

Table 1,Page 2

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES Provision of endorsements and guarantees to others For the nine months ended September 30, 2021

Table 2

Number
（Note 1）		 Endorser/
guarantor		 Party being
endorsed/guaranteed		 Party being
endorsed/guaranteed		 Limit on
endorsements/
guarantees
provided for a
single party
(Note 3)		 Maximum
outstanding
endorsement/
guarantee
amount as of
September 30,
2021		 Outstanding
endorsement/
guarantee
amount at
September 30,
2021		 Actual amount
drawn down		 Amount of
endorsements/
guarantees
secured with
collateral		 Ratio of accumulated
endorsement/guarantee
amount to net asset value
of the endorser/guarantor
company		 Ceiling on
total amount of
endorsements/
guarantees
provided
（Note 3）		 Provision of
endorsements/
guarantees by
parent
company to
subsidiary		 Provision of
endorsements/
guarantees by
subsidiary to
parent
company		 Provision of
endorsements/
guarantees to
the
party in
Mainland
China
Companyname Relationship
with the
endorser/
guarantor
（Note 2）
0 MiTAC Holdings Corp. Tyan Computer Corp.(USA) 2 22,884,582
$		 199,745
$		 194,950
$		 194,950
$		 $ - 0.43 22,884,582
$		 Y N N
0 MiTAC Holdings Corp. MiTAC Computing Technology Corp. 2 22,884,582 664,866 648,905 648,905 - 1.42 22,884,582 Y N N
0 MiTAC Holdings Corp. MiTAC International Corp. 2 22,884,582 230 230 230 - 0.00 22,884,582 Y N N
0 MiTAC Holdings Corp. MiTAC Digital Technology Corp. 2 22,884,582 3,805 3,714 3,714 - 0.01 22,884,582 Y N N
0 MiTAC Holdings Corp. MiTAC Information Systems Corp. 2 22,884,582 513,630 501,300 - - 1.10 22,884,582 Y N N

Note 1: The numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows: (1) The Company is ‘0’.

  • (2) The subsidiaries are numbered in order starting from ‘1’.

Note 2: Relationship between the endorser/guarantor and the party being endorsed/guaranteed is classified into the following nine categories; fill in the number of category each case belongs to: (1) Having business relationship

  • (2)The endorser/guarantor parent company owns directly and indirectly more than 50% voting shares of the endorsed/guaranteed subsidiary. (3) The endorsed/guaranteed company owns directly and indirectly more than 50% voting shares of the endorser/guarantor parent company. (4)The endorser/guarantor parent company owns directly and indirectly more than 90% voting shares of the endorsed/guaranteed company. (5)Mutual guarantee of the trade made by the endorsed/guaranteed company or joint contractor as required under the construction contract. (6)Due to joint venture, all shareholders provide endorsements/guarantees to the endorsed/guaranteed company in proportion to its ownership. (7) Joint guarantee of the performance guarantee for pre-sold home sales contract as required under the Consumer Protection Act.

Note 3: (1) The endorsement and guarantees amount provided by MiTAC Holdings Corp. to each entity which is directly or indirectly held 50% or more of the voting power by the company should not exceed 50% of the net worth on the latest financial statements audited or reviewed by independent auditors.

(2) MiTAC Holding Corp's total endorsements and guarantees should not exceed 50% of the net worth on the latest financial statements audited or reviewed by independent auditors. 

Table 2,Page 1

Table 3

Expressed in thousands of NTD (Except as otherwise indicated)

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES

Holding of marketable securities at the end of period (not including subsidiaries, associates and joint ventures) September 30, 2021

Securities held by Marketable securities Marketable securities Relationship with the
securities issuer		 General ledger
account		 As of September 30, 2021 As of September 30, 2021 As of September 30, 2021 As of September 30, 2021 Footnote
Number of shares Book value Ownership (%) Fair value
MiTAC Holdings Corp. stocks Synnex Technology International Corp. Same board chairman Financial assets at fair value through other comprehensive income - non current 3,103,717 162,014
$		 0.19 162,014
$
MiTAC Holdings Corp. stocks Healthera Corporation None Financial assets at fair value through other comprehensive income - non-current 72,112 2,456 0.34 2,456
MiTAC Holdings Corp. stocks JVP VIII, L.P. None Financial assets at fair value through other comprehensive income - non-current 2,037,500 69,055 1.16 69,055
MiTAC Holdings Corp. stocks WHETRON ELECTRONICS CO., LTD. None Financial assets at fair value through other comprehensive income - non-current 6,550,000 195,459 9.05 195,459
MiTAC Holdings Corp. stocks Harbinger VIII Venture Capital Corp. None Financial assets at fair value through other comprehensive income - non-current 11,250,000 112,276 11.57 112,276
MiTAC International Corp. stocks Lien Hwa Industrial Holdings Corporation Same board chairman Financial assets at fair value through other comprehensive income - non-current 39,325,733 2,202,241 2.79 2,202,241
MiTAC International Corp. stocks UPC Technology Corp. Same board chairman Financial assets at fair value through other comprehensive income - non-current 16,179,560 411,770 1.21 411,770
MiTAC International Corp. stocks COMPUCASE ENTERPRISE CO., LTD. None Financial assets at fair value through other comprehensive income - non-current 10,000,000 316,500 8.83 316,500
MiTAC International Corp. stocks Synnex Technology International Corp. Same board chairman Financial assets at fair value through other comprehensive income - non-current 5,245,000 273,789 0.31 273,789
MiTAC International Corp. stocks MiTAC Information Technology Corp. The Company's chairman was this
company's director.		 Financial assets at fair value through other comprehensive income - non-current 6,259,734 81,238 4.17 81,238
MiTAC International Corp. stocks MiTAC INC. Same board chairman Financial assets at fair value through other comprehensive income - non-current 32,931,366 1,729,620 8.70 1,729,620
MiTAC International Corp. stocks Overseas Investment & Development Corp. None Financial assets at fair value through other comprehensive income - non-current 1,000,000 11,191 1.11 11,191
MiTAC International Corp. stocks Harbinger Venture Capital Corp. Same board chairman Financial assets at fair value through other comprehensive income - non-current 27,828 257 14.05 257
MiTAC International Corp. stocks Harbinger VI Venture Capital Corp. None Financial assets at fair value through other comprehensive income - non-current 3,213,811 42,965 13.28 42,965
MiTAC International Corp. stocks Harbinger VII Venture Capital Corp. Same board chairman Financial assets at fair value through other comprehensive income - non-current 8,338,028 114,216 9.39 114,216
Tsu Fung Investment Corp. stocks MiTAC Holdings Corp. Ultimate parent company Financial assets at fair value through other comprehensive income - current 9,250,594 265,030 0.77 265,030 Note 1
Tsu Fung Investment Corp. stocks Getac Holdings Corp. None Financial assets at fair value through other comprehensive income - current 7,783,741 402,419 1.31 402,419
Tsu Fung Investment Corp. stocks UPC Technology Corp. None Financial assets at fair value through other comprehensive income - current 17,460,231 444,364 1.31 444,364
Tsu Fung Investment Corp. stocks Synnex Technology International Corp. None Financial assets at fair value through other comprehensive income - current 8,217,974 428,978 0.49 428,978
Tsu Fung Investment Corp. stocks Lien Hwa Industrial Holdings Corporation None Financial assets at fair value through other comprehensive income - current 4,732,382 265,013 0.34 265,013
Tsu Fung Investment Corp. stocks PROMISE Technology Inc. None Financial assets at fair value through other comprehensive income - current 2,609,479 33,793 2.92 33,793
Tsu Fung Investment Corp. stocks MiTAC Information Technology Corp. None Financial assets at fair value through other comprehensive income - non-current 4,594,672 59,630 3.06 59,630
Tsu Fung Investment Corp. stocks MiTAC INC. None Financial assets at fair value through other comprehensive income - non-current 20,302,221 1,066,312 5.36 1,066,312
Tsu Fung Investment Corp. stocks Tung Da Investment Co., Ltd. None Financial assets at fair value through other comprehensive income - non-current 4,848,125 186,724 19.99 186,724 Note 2
Tsu Fung Investment Corp. stocks Harbinger Venture Management Company Ltd. None Financial assets at fair value through other comprehensive income - non-current 862,922 17,732 19.99 17,732
Tsu Fung Investment Corp. stocks Lien Yung Investment Corp. None Financial assets at fair value through other comprehensive income - non-current 9,217,196 159,466 19.99 159,466
Silver Star Developments Ltd. and its subsidiaries stocks MiTAC Holdings Corp. Ultimate parent company Financial assets at fair value through other comprehensive income - non-current 2,127,954 60,966 0.18 60,966 Note 1
Silver Star Developments Ltd. and its subsidiaries stocks TD Synnex Corp. None Financial assets at fair value through other comprehensive income - non-current 5,299,980 15,365,622 5.52 15,365,622 Note 3
Silver Star Developments Ltd. and its subsidiaries stocks Budworth Investments Ltd. None Financial assets at fair value through other comprehensive income - non-current 134,908 42 14.83 42
Silver Star Developments Ltd. and its subsidiaries stocks Panasas Inc. None Financial assets at fair value through profit or loss - non-current 13,913 - 0.04 -

Note 1: The Company's shares held by Tsu Fung Investment Corp. and Silver Star Developments Ltd. are accounted for as treasury stocks.

Note 2: MiTAC International Corp. sold its shares of Tung Da Investment Co., Ltd. to Tsu Fung Investment Corp.,and such disposal gain has not yet been realised.

Note 3: Synnex Corp. became a non-related party of the Group since September 1, 2021 as the Group lost significant influence over it and was renamed to TD Synnex Corp. 

Table 3,Page 1

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES

Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company's paid-in capital For the nine months ended September 30, 2021

Table 4 Table 4 Table 4 Table 4 Table 4 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)		 Expressed in thousands of NTD
(Except as otherwise indicated)
Investor Marketable securities General ledger account Counterparty Relationship
with the
investor		 Balance as at January 1, 2021 Addition Disposal Balance as at September 30, 2021
Number of
shares		 Amount Number of
shares		 Amount Number of
shares		 Selling price Book value Gain (loss) on
disposal		 Number of shares Amount (Note)
Silver Star Developments Ltd. Stocks of Concentrix
Corp.		 Investments accounted for
using equity method		 - - 5,299,980 $ 6,677,974 - $ - 359,754 $1,469,173
(US$52,344)		 $469,196
(US$16,716)		 $999,977
(US$35,628)		 4,940,226 $ 6,699,569

Note: It pertains to the book value of investments accounted for using equity method in September 2021. 

Table 4,Page 1

Table 5

Expressed in thousands

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES

Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more

For the nine months ended September 30, 2021

Realestate disposed by Realestate Transaction date
or date of the
event		 Date of
acquisition		 Bookvalue Disposal
amount		 Status of
collection of
proceeds		 Gain (loss) on
disposal		 Counterparty Relationship with
the seller		 Reason fordisposal Basis or reference used
insetting the price		 Othercommitments
MiTAC Computer (Shunde) Ltd. Land use rights December 25,
2020
(Note 1)		 January 1, 2003 $55,537
(CNY12,804)		 $798,531
(CNY184,094)		 All collected $742,994
(CNY171,290)		 Land
Arrangement and
Reserve Center of
Shunde District,
Foshan City		 Third party To cooperate with the land
banking by the local
government for the village-
level industrial park
upgrading and renovation
project		 Note 2 None
MiTAC Computer (Shunde) Ltd. Land use rights
Buildings		 November 7,
2019
(Note 1)		 January 31,
1996		 $33,785
(CNY7,788)		 $334,976
(CNY77,225)		 All collected $301,191
(CNY69,437)		 Land
Arrangement and
Reserve Center of
Shunde District,
Foshan City		 Third party To cooperate with the land
banking by the local
government for the city
construction development
project		 Note 3 None

Note 1: It refers to the resolution date by the Board of Directors of the subsidiary.

Note 2: It was by reference to the appraisal report issued by the professional appraisal company and was determined based on the expropriation agreement. Note 3: It was by reference to the appraisal report issued by the professional appraisal company and was determined based on the auction price.

Table 5,Page 1

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more For the nine months ended September 30, 2021

Table 6

Expressed in thousands of NTD (Except as otherwise indicated)

Purchaser/seller Counterparty Relationship with the
counterparty		 Transaction Transaction Transaction Transaction Differences in transaction terms Differences in transaction terms Notes/accounts receivable(payable) Notes/accounts receivable(payable) Footnote
Purchases
/sales		 Amount Percentage of total
purchases/sales		 Credit term Unitprice Credit term Balance Percentage of
total notes/accounts
receivable(payable)
MiTAC Computing Technology Corp. MiTAC Information Systems Corp. Subsidiary Sales 8,407,910
$		 46% Note 1 Note 3 Note 1 3,777,101
$		 67%
MiTAC Computing Technology Corp. MiTAC Computer (Shunde) Ltd. Affiliate Purchases 136,954 1% Note 2 Note 3 Note 2 1,221,702)
(		 21%
MiTAC Computing Technology Corp. Tyan Computer Corp.(USA) Subsidary Sales 280,940 2% Note 1 Note 3 Note 1 - 0%
MiTAC Computing Technology Corp. MiTAC Telematics Technology Corporation Subsidiary Sales 110,642 1% Note 1 Note 3 Note 1 6,548 0%
MiTAC Computing Technology Corp. TD Synnex Corp. and its subsidiaries Note 4 Sales 288,950 2% Note 1 Note 3 Note 1 - 0%
MiTAC Computing Technology Corp. Synnex Technology International Corp. Other related parties Purchases 157,428 1% Note 2 Note 3 Note 2 101,845)
(		 0%
MiTAC Computing Technology Corp. MiTAC Japan Corp. Affiliate Sales 167,797 1% Note 1 Note 3 Note 1 38,962 1%
MiTAC Digital Technology Corp. MiTAC Australia Pty Corp. Subsidiary Sales 129,250 4% Note 1 Note 3 Note 1 110,555 15%
MiTAC Digital Technology Corp. MiTAC Computer (Kunshan) Ltd. Affiliate Purchases 1,047,429 36% Note 2 Note 3 Note 2 734,110)
(		 55%
Silver Star Developments Ltd.(SSDL) and its subsidiaries MiTAC Computing Technology Corp. Affiliate Sales 213,073 2% Note 1 Note 3 Note 1 1,326,500 13%
Silver Star Developments Ltd.(SSDL) and its subsidiaries MiTAC Computing Technology Corp. Affiliate Purchases 168,100 2% Note 2 Note 3 Note 2 38,962)
(		 1%
Silver Star Developments Ltd.(SSDL) and its subsidiaries MiTAC Digital Technology Corp. Affiliate Sales 1,057,912 10% Note 1 Note 3 Note 1 754,211 7%
MiTAC Technology UK Ltd. and its subsidiaries MiTAC Computing Technology Corp. Parent
Company		 Purchases 8,688,850 53% Note 2 Note 3 Note 2 3,777,101)
(		 82%
MiTAC Technology UK Ltd. and its subsidiaries TD Synnex Corp. and its subsidiaries Note 4 Sales 214,775 1% Note 1 Note 3 Note 1 - 0%
Access Wisdom Holdings Ltd. and its subsidiaries MiTAC Digital Technology Corp. Parent
Company		 Purchases 201,154 108% Note 2 Note 3 Note 2 111,389)
(		 71%
Note 1: The Group’s credit term for subsidiaries is to collect within 5 months based on the net amount of receivables after offseting against payables. The Group’s credit term for related parties is within 3 months based on the net amount of receivables
after offsetting against payables; the credit term for third parties is an average of 3 months after the date of shipment.
Note 2: The Group’s payment term for subsidiaries is within 5 months based on the net amount of receivables after offsetting against payables. The Group's payment term related parties within 3 months based on the net amount of receivables after
offsetting against payables; the payment term for third parties is an average of 3 months after the date of shipment from the counterparty.
Note 3: The selling price to related parties is based on market value.
Note 4: TD Synnex Corp. and its subsidiaries became third parties since September 1, 2021.		 
Table 6,Page 1

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES

Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more September 30, 2021

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more
September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more
September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more
September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more
September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more
September 30, 2021		 MITAC HOLDINGS CORPORATION AND SUBSIDIARIES
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more
September 30, 2021
Table 7 Expressed in thousands of NTD
(Except as otherwiseindicated)
Creditor Counterparty Relationship
with the
counterparty		 Accounts
receivable		 Other
receivables		 Turnover
rate		 Overdue receivables Amount collected
subsequent to the
balance sheet date		 Allowance for
doubtful accounts		 Footnote
Amount Action taken
MiTAC Computing Technology Corp. Mitac Information Systems Corp. Subsidiary 3,777,101
$		 9,134
$		 2.73 -
$		 Not Applicable 615,742
$		 -
$
MiTAC Digital Technology Corp. MiTAC Australia Pty Corp. Subsidiary 110,555 9 1.78 11,246 Subsequent collection 22,362 -
Silver Star Develpoments Ltd. and its subsidiaries MiTAC Computing Technology Corp. Affiliate 1,326,500 12,956 0.20 - Not Applicable 766,496 -
Silver Star Develpoments Ltd. and its subsidiaries MiTAC Digital Technology Corp. Affiliate 754,211 2,444 1.76 - Not Applicable 111,240 - 
Table 7,Page 1

Table 8

Expressed in thousands of NTD

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES

Significant inter-company transactions during the reporting periods For the nine months ended September 30, 2021

(Except as otherwise indicated)

Number
(Note 1)		 Companyname Counterparty Relationship
(Note 2)		 Transaction Transaction Transaction Transaction
General ledger account Amount Transaction terms Percentage of consolidated
total operating revenues or
total assets (Note 3)
0 MiTAC Holdings Corp. MiTAC Computing Technology Corp. 1 Other receivables 3,158,528
$		 4.44%
0 MiTAC Holdings Corp. MiTAC Digital Technology Corp. 1 Other receivables 278,591 0.39%
1 MiTAC International Corp. MiTAC Holdings Corp. 2 Other receivables 227,411 0.32%
2 MiTAC Computing Technology Corp. MiTAC Holdings Corp. 2 Other receivables 1,420,000 2.00%
2 MiTAC Computing Technology Corp. MiTAC Technology UK Ltd. and its subsidiaries 3 Sales 8,688,850 Note 4 26.53%
2 MiTAC Computing Technology Corp. MiTAC Technology UK Ltd. and its subsidiaries 3 Accounts receivable 3,777,101 Note 4 5.31%
2 MiTAC Computing Technology Corp. Silver Star Develpoments Ltd. and its subsidiaries 3 Sales 168,100 Note 4 0.51%
2 MiTAC Computing Technology Corp. Silver Star Develpoments Ltd. and its subsidiaries 3 Purchases 213,073 Note 5 0.65%
2 MiTAC Computing Technology Corp. Silver Star Develpoments Ltd. and its subsidiaries 3 Accounts payable 1,326,500 Note 5 1.87%
2 MiTAC Computing Technology Corp. MiTAC Telematics Technology Corporation 3 Sales 110,642 Note 4 0.34%
3 Silver Star Develpoments Ltd. and its subsidiaries MiTAC Holdings Corp. 2 Other receivables 3,435,855 4.83%
4 MiTAC Digital Technology Corp. Access Wisdom Holdings Ltd. and its subsidiaries 3 Sales 201,154 Note 4 0.61%
4 MiTAC Digital Technology Corp. Access Wisdom Holdings Ltd. and its subsidiaries 3 Accounts receivable 111,389 Note 4 0.16%
4 MiTAC Digital Technology Corp. Silver Star Develpoments Ltd. and its subsidiaries 3 Purchases 1,057,912 Note 5 3.23%
4 MiTAC Digital Technology Corp. Silver Star Develpoments Ltd. and its subsidiaries 3 Accounts payable 754,211 Note 5 1.06%
4 MiTAC Digital Technology Corp. MiTAC Holdings Corp. 2 Other receivables 600,146 0.84%

Note 1: The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

  • (1) Parent company is "0".

(2) The subsidiaries are numbered in order starting from "1".

Note 2: Relationship between transaction company and counterparty is classified into the following three categories:

(1) Parent company to subsidiary.

(2) Subsidiary to parent company.

(3) Subsidiary to subsidiary.

Note 3: Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and based on accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts.

Note 4: The Group's credit term for foreign related parties is 5 months for the collection of the net amount of receivables after offsetting against payables, which takes into consideration the reasonable amount of time for the

Company to ship the products to each company and for the collection of the accounts. The company's sales price with related parties is based on the intermational market trends and the region the sales were made.

Note 5: The Group's payment term for foreign related parties is 5 months for the collection of the net amount of receivables after offsetting against payables after checking and the transaction price is based on the international market trends and the region the sales were made.

Note 6: The Company may decide to disclose or not to disclose transaction details in this table based on the Materiality Principle. 

Table 8,Page 1

Table 9

Expressed in thousands of NTD (Except as otherwise indicated)

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES Information on investees (Does not include Mainland China invested companies) For the nine months ended September 30, 2021

Investor Investee Location Main business
activities		 Initial investment amount Initial investment amount Sharesheld as at September30,2021 Sharesheld as at September30,2021 Sharesheld as at September30,2021 Net profit (loss)
of the investee
for the nine
months ended
September 30,
2021		 Investment
income (loss)
recognised by the
Company for the
nine months
ended September
30,2021		 Footnote
Balance as at September
30,2021		 Balance as at
December 31,
2020		 Number of shares Ownership
(%)		 Book value
MiTAC Holdings Corp. MiTAC International Corp. Taiwan Development, design and
manufacturing and sale of computers
and its peripherals,
telecommunication relatedproducts		 24,739,187
$		 24,739,187
$		 2,393,020,550 100.00 45,735,856
$		 11,327,805
$		 11,316,427
$		 Subsidiary
MiTAC Holdings Corp. MiTAC Computing Technology Corp. Taiwan Development, design and
manufacturing and sale of computers
and its peripherals,
telecommunication relatedproducts		 3,419,621 3,419,621 232,757,102 100.00 3,831,712 230,799 231,015 Subsidiary
MiTAC Holdings Corp. MiTAC Digital Technology Corp. Taiwan Sales and service of electronic
telecommunication, communication
and software, etc.		 1,547,485 1,547,485 103,099,000 97.17 1,587,258 23,891)
(		 23,152)
(		 Subsidiary
MiTAC Holdings Corp. Infopower Technologies Ltd. India Manufacture and sale of electronic
product.		 72,249 72,249 6,774,199 33.33 68,831 493)
(		 164)
(		 Associate
MiTAC International Corp. Getac Holdings Corp. Taiwan Manufacturing and sale of notebook
computers, military and industrial
computer systems,etc.		 1,391,549 1,391,549 190,396,939 31.97 5,477,847 3,556,407 Associate
MiTAC International Corp. Tsu Fung Investment Corp. Taiwan Investment 625,000 625,000 142,884,651 100.00 3,519,321 129,980 Subsidiary
MiTAC International Corp. 3Probe Technologies Corp. Taiwan Information process service, sales of
software and international trading.		 16,839 16,839 1,086,000 23.25 11,610 2,947)
(		 Associate
MiTAC International Corp. Lian Jie Investment Co., Ltd. Taiwan Investment 113,057 113,057 11,305,650 49.98 174,916 5,958 Associate
MiTAC International Corp. Lian Jie II Investment Co., Ltd. Taiwan Investment 32,500 32,500 3,250,000 32.50 33,009 575 Associate
MiTAC International Corp. Silver Star Developments Ltd.and its
subsidiary		 British Virgin
Islands		 Investment 4,909,936 4,909,936 176,299,302 100.00 32,972,873 15,465,296 Subsidiary
MiTAC International Corp. Shen-Tong Construction &
Development Co., ltd.		 Taiwan Building and factory construction,
leasing and sales		 90,349 90,349 9,034,922 47.55 85,853 335)
(		 Associate
MiTAC International Corp.
LFE AEROSPACE INDUSTRY CORP.		 Taiwan
Electronic components
manufacturing, aircraft and its parts
manufacturing and wholesale
industry.		 121,475 121,475 11,233,750 15.40 107,363 19,085)
(		 Associate
MiTAC Computing Technology
Corp.		 MiTAC Technology UK Ltd. and its
subsidiaries		 UK Investment 1,419,189 1,419,189 55,146,138 100.00 1,677,606 244,395 Subsidiary 
Table 9,Page 1
Investor Investee Location Main business
activities		 Initial investment amount Initial investment amount Sharesheld as at September30,2021 Sharesheld as at September30,2021 Sharesheld as at September30,2021 Net profit (loss)
of the investee
for the nine
months ended
September 30,
2021		 Investment
income (loss)
recognised by the
Company for the
nine months
ended September
30,2021		 Footnote
Balance as at September
30,2021		 Balance as at
December 31,
2020		 Number of shares Ownership
(%)		 Book value
MiTAC Computing Technology
Corp.		 Hyve Design Solutions Corporation USA Assemble and sales of computer and
peripheral equipment.		 139,250 139,250 1,000,000 50.00 83,195)
(		 137,491)
(		 Associate
MiTAC Digital Technology Corp. Mio International Ltd. and its
subsidiaries		 British Virgin
Islands		 Sale of communication products 63,433 63,433 1,275,001 100.00 77,615 988 Subsidiary
MiTAC Digital Technology Corp. Access Wisdom Holdings Limited. and
its subsidiaries		 British Virgin
Islands		 Investment - - 48,500,000 100.00 135,323 44,982 Subsidiary
Silver Star Developments Ltd. and
its subsidiaries		 Mainpower International Ltd. British Virgin
Islands		 Investment 153,175 153,175 5,500,001 13.28 250,959 103,394 Associate
Silver Star Developments Ltd. and
its subsidiaries		 Concentrix Corp. USA Information process services, sales of
computer peripheral, system and
network products		 6,102,404 6,530,252 4,940,226 9.44 6,699,569 7,692,443 Associate
Silver Star Developments Ltd. and
its subsidiaries		 Harbinger Ruyi Venture Ltd. British Virgin
Islands		 Investment 27,850 27,850 1,000,000 28.57 18,716 39 Associate
Silver Star Developments Ltd. and
its subsidiaries		 Harbinger Ruyi II Venture Ltd. British Virgin
Islands		 Investment 27,850 27,850 10,000 32.26 53,925 933)
(		 Associate
Tsu Fung Investment Corp. LFE AEROSPACE INDUSTRY CORP. Taiwan Electronic components
manufacturing, aircraft and its parts
manufacturing and wholesale
industry.		 15,504 15,504 1,433,740 1.97 12,729 19,085)
(		 Associate
Tsu Fung Investment Corp. MiTAC Digital Technology Corp. Taiwan Electronic components
manufacturing, aircraft and its parts
manufacturing and wholesale
industry.		 16 16 1,000 - 16 23,891)
(		 Subsidiary 
Table 9,Page 2

Expressed in thousands of NTD (Except as otherwise indicated)

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES Information on investments in Mainland China

For the nine months ended September 30, 2021

Table 10

A. Invested information in Mainland China

A.Investedinformation in Mainland China
Investee in Mainland China Main business
activities		 Paid-incapital Investment
method
(Note 1)		 Accumulated amount
of remittance from
Taiwan to Mainland
China as of January
1,2021		 Amount remitted from
Taiwan to
Mainland China/
Amount remitted back
to Taiwan for the nine
months ended September 30,
2021		 Accumulated
amount of
remittance from
Taiwan to Mainland
China as of
September 30,2021		 Net income of
investee as of
September 30,
2021		 Ownership held
by the Company
(direct or
indirect)		 Investment
income (loss)
recognised by
the Company
for the nine
months ended
September 30,
2021(Note 2)		 Book value of
investments in
Mainland China
as of September
30,2021		 Accumulated amount of
investment income
remitted back to Taiwan
as of September 30,2021		 Footnote
Remitted to
Mainland
China		 Remitted back
toTaiwan
MiTAC Computer (Shunde) Corp. Manufacturing of computer cases and monitors., etc. 1,793,917
$		 2 1,111,236
$		 -
$		 -
$		 1,111,236
$		 816,931
$		 100.00 816,931
$		 3,627,956
$		 -
$
MiTAC Computer (Kunshan) Co., Ltd. Sales and manufacturing of computer accessories,
hardware, software and related services		 2,197,724 2 1,632,010 - - 1,632,010 10,447)
(		 100.00 10,447)
(		 2,786,092 -
MiTAC Technology (Kunshan) Co., Ltd. Testing, repair and display of computer components
and related products, and related technical advisory
services and after-sale services		 35,632 2 27,850 - - 27,850 8,503)
(		 100.00 8,503)
(		 18,645 -
MiTAC Research (ShangHai) Ltd. Research, development and production of computer
software, sales of own-produced products and
related technical advisory services		 157,300 2 144,820 - - 144,820 10,393 100.00 10,393 449,382 -
Shzhou MiTAC Precision Technology
Co., Ltd.
Design and manufacturing of computer chassis and
its components, percision plastic injection mould,
molding parts and molding equipment processing and
maintenance and repair services.		 1,519,569 2 375,975 - - 375,975 - 27.44 33,981 619,306 -
Mio Technology (Suzhou) Ltd.
Sales of communication products and related after-
sale services		 8,083 2 27,711 - - 27,711 988 100.00 988 34,136 -
MiTAC Logistic Service (Kunshan) Ltd. Agency of freight transport, export and import
trading and warehousing services		 29,363 2 27,850 - - 27,850 498)
(		 100.00 498)
(		 38,321 -
MiTAC Information Technology Ltd.
After-sales maintenance, testing, consulting services
and related support technology services		 8,819 2 8,355 - - 8,355 177 100.00 177 19,235 -
MiTAC Innovation (Kunshan) Ltd.
Research and development of computer, server,
mobile phone, PDA, GNSS and GPS, and related
technology transfer, technical services		 28,286 2 27,850 - - 27,850 2,987 100.00 2,987 77,459 -
MiTAC Telematics Technology
Corporation
Sales of self-produced products and related after-sale
services		 8,610 1 2,032 - - 2,032 240)
(		 100.00 240)
(		 16,296 -
MiTAC Investment Holding Ltd. Investment Holdings 2,020,302 2 835,500 - - 835,500 21,500)
(		 100.00 21,500)
(		 3,033,431 -
MiTAC Information Systems (Kunshan)
Co., Ltd.		 Sales and manufacturing of computer accessories,
hardware, software and related services		 1,033,200 3 - - - - 30,922)
(		 100.00 30,922)
(		 996,040 -
Note 1: Investment methods are classified into the following three categories:
(1) Directly invest in a company in Mainland China.
(2) Invest in Mainland China through an existing company in the third area
(3) Others:Invest in Mainland China through investees in Mainland China.
(1) It should be indicated if the investee was still in the incorporation arrangements and had not yet generated any profit during this period.
(2) Indicate the basis for investment income (loss) recognition in the number of one of the following three categories:
A. The financial statements were audited and attested by international accounting firm which has cooperative relationship with accounting firm in R.O.C..
B. The financial statements were audited and attested by R.O.C. parent company's CPA.
C. The financial statements were not audited and attested by independent accountants.
Note 2: In the 'Investment income (loss)recognised by the Company for the nine months ended September 30, 2021 column:

(3) The basis for investment income (loss) recognition for MiTAC computer (Shunde) Corp., MiTAC Computer (Kunshan) Co., Ltd., MiTAC Research (ShangHai) Ltd., and Shzhou MiTAC Precision Technology Co., Ltd. is category B, the others are category C.

Note 3:Among the accumulated amount of remittance from Taiwan to Mainland China as of September 30, 2021 of MiTAC Computer (Kunshan) Co., Ltd., MiTAC Investment Holding Ltd remitted out USD 29,900 thousand. 

Table 10,Page 1
Companyname Accumulated amount of remittance from Taiwan to
Mainland China as of September 30,2021		 Investment amount approved by the Investment
Commission of the Ministry of Economic Affairs
(MOEA)		 Ceiling on investments in Mainland China imposed by the Investment
Commission of MOEA
MiTAC International Corp. 3,740,319
$		 4,541,006
$		 27,637,111
$
MiTAC Computing Technology Corp. 2,032 2,032 2,295,758
MiTAC Digital Technology Corp. 20,748 20,748 979,665

C. Significant transactions conducted with investees in Mainland China:

MiTAC Digital Technology Corp. and MiTAC Computing Technology Corp's delivery service expenses with investees in Mainland China for the nine months ended September 30, 2021 amounted to $16,691, for details of other significant transactions, please refer to table 1 and table 6. 

Table 10,Page 2

MITAC HOLDINGS CORPORATION AND SUBSIDIARIES

Major shareholders information September 30, 2021

Table 11

Name of major shareholders Shares Shares
Number of shares held Ownership (%)
MiTAC INCORPORATED 104,431,091 8.65%
UPC Technology Corporation 99,802,598 8.27%
Lien Hwa Industrial Holdings Corporation 95,940,944 7.95% 
Table 11,Page 1

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