NTC - Interim / Quarterly Report 2021

Stock Code:2408

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES

Consolidated Financial Statements

With Independent Auditors’ Review Report For the Nine Months Ended September 30, 2021 and 2020

Address: No.98, Nanlin Rd., Dake Vil., Taishan Dist., New Taipei City, Taiwan (R.O.C.) Telephone:(02)2904-5858

The independent auditors’ review report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ review report and consolidated financial statements, the Chinese version shall prevail.

Contents 1. Cover Page 2. Table of Contents 3. Independent Auditors’ Review Report 4. Consolidated Balance Sheets 5. Consolidated Statements of Comprehensive Income 6. Consolidated Statements of Changes in Equity 7. Consolidated Statements of Cash Flows 8. Notes to the Consolidated Financial Statements (1) Company history (2) Approval date and procedures of the consolidated financial statements (3) New standards, amendments and interpretations adopted (4) Summary of significant accounting policies (5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty (6) Explanation of significant accounts (7) Related-party transactions (8) Pledged assets (9) Commitments and contingencies (10) Losses Due to Major Disasters (11) Subsequent Events (12) Other (13) Other disclosures (a) Information on significant transactions (b) Information on investees (c) Information on investment in mainland China (d) Information on major shareholders (14) Segment information	Page
	1 2 3 4 5 6 7 8 8 8～10 10～11 12 12～37 38～41 41 41～42 42 42 43 44～45 46 46 47 47～48

Contents
1. Cover Page
2. Table of Contents
3. Independent Auditors’ Review Report
4. Consolidated Balance Sheets
5. Consolidated Statements of Comprehensive Income
6. Consolidated Statements of Changes in Equity
7. Consolidated Statements of Cash Flows
8. Notes to the Consolidated Financial Statements
(1)
Company history
(2)
Approval date and procedures of the consolidated financial statements
(3)
New standards, amendments and interpretations adopted
(4)
Summary of significant accounting policies
(5)
Significant accounting assumptions and judgments, and major sources
of estimation uncertainty
(6)
Explanation of significant accounts
(7)
Related-party transactions
(8)
Pledged assets
(9)
Commitments and contingencies
(10) Losses Due to Major Disasters
(11) Subsequent Events
(12) Other
(13) Other disclosures
(a) Information on significant transactions
(b) Information on investees
(c) Information on investment in mainland China
(d) Information on major shareholders
(14) Segment information

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KPMG

台北市110615信義路5段7號68樓(台北101大樓) Telephone 電話 + 886 2 8101 6666 68F., TAIPEI 101 TOWER, No. 7, Sec. 5, Fax 傳真 + 886 2 8101 6667 Xinyi Road, Taipei City 110615, Taiwan (R.O.C.) Internet 網址 home.kpmg/tw

Independent Auditors’ Review Report

To the Board of Directors of Nanya Technology Corporation：

Introduction

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

Scope of Review

We conducted our reviews in accordance with Statement of Auditing Standard 65, “ Review of Financial Information Performed by the Independent Auditor of the Entity” . A review of the 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 conducted in accordance with the generally accepted auditing standards 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.

KPMG, a Taiwan partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

3-1

Conclusion

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 Nanya Technology Corporation and its subsidiaries as of September 30, 2021 and 2020, and of its consolidated financial performance for the three months and nine months ended September 30, 2021 and 2020, as well as its consolidated cash flows for the nine months ended September 30, 2021 and 2020 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “ Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

The engagement partners on the reviews resulting in this independent auditors’ review report are Hui-Chih Ko and Hsin-Yi Kuo.

KPMG

Taipei, Taiwan (Republic of China) November 3, 2021

Notes to Readers

The accompanying consolidated financial statements are intended only to present the consolidated statement of financial position, financial performance and cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to review such consolidated financial statements are those generally accepted and applied in the Republic of China.

The independent auditors’ report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and consolidated financial statements, the Chinese version shall prevail.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with the generally accepted auditing standards as of September 30, 2021 and 2020

Nanya Technology Corporation and Subsidiaries

Consolidated Balance Sheets

September 30, 2021, December 31 and September 30, 2020 (Expressed in Thousands of New Taiwan Dollars)

September 30, 2021 Assets Amount % Current assets: 1100 Cash and cash equivalents (Note 6(a)) $ 71,557,947 38 1170 Accounts receivable, net (Notes 6(b)(p)) 12,961,380 7 1180 Accounts receivable due from related parties, net (Note 6(b)(p) and 7) - - 1200 Other receivables (Notes 6(c)) 1,422,133 1 1310 Inventories (Note 6(d)) 10,870,335 6 1410 Prepayments (Note 6(e)) 865,244 1 1470 Other current assets (Note 6(e)) 614,597 - Total current assets 98,291,636 53 Non-current assets: 1517 Non-current financial assets at fair value through other comprehensive income 5,700 - 1550 Investments accounted for using equity method (Note 6(f)) 5,206,948 3 1600 Property, plant and equipment (Notes 6(g)(v) and 7) 79,291,727 42 1755 Right-of-use assets (Notes 6(h)) 1,710,714 2 1780 Intangible assets 1,074,746 - 1840 Deferred tax assets 271,720 - 194D Long-term financial lease payments receivable (Note 6(i)) 313,846 - 1990 Other non-current assets (Note 8) 137,163 - Total non-current assets 88,012,564 47 Total assets $ 186,304,200 100	December 31, 2020 Amount % 51,725,906 31 7,867,928 4 8,237 - 1,496,119 1 14,126,982 9 559,481 - 959,948 1 76,744,601 46 - - 5,160,505 3 79,728,620 49 1,790,192 1 1,258,380 1 353,567 - 483,436 - 112,679 - 88,887,379 54 165,631,980 100	September 30, 2020 Amount % 47,125,617 28 9,636,173 6 1,384 - 1,806,927 1 15,455,652 10 1,027,639 - 1,050,826 1 76,104,218 46 - - 4,871,850 3 81,108,305 49 1,837,302 1 1,319,201 1 456,866 - 537,083 - 971,640 - 91,102,247 54 167,206,465 100 Liabilities and Equity Current liabilities: 2170 Accounts payable 2180 Accounts payable to related parties (Note 7) 2200 Other payables 2220 Other payables to related parties (Note 7) 2230 Current tax liabilities 2280 Current lease liabilities (Notes 6(j) and 7) 2399 Other current liabilities Total current liabilities Non-Current liabilities: 2570 Deferred tax liabilities 2580 Non-current lease liabilities (Notes 6(j) and 7) 2640 Net defined benefit liability, non-current 2670 Other non-current liabilities Total non-current liabilities Total liabilities Equity (Note 6(m)): 3110 Ordinary shares 3140 Advance receipts for share capital 3200 Capital surplus 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings 3400 Other equity interest 3500 Treasury shares Total equity Total liabilities and equity	September 30, 2021		December 31, 2020		September 30, 2020 Amount % 3,967,748 2 109,893 - 4,372,980 2 1,050,927 1 1,039,252 1 177,833 - 1,168 - 10,719,801 6 1,158 - 1,662,485 1 572,372 - 852,080 1 3,088,095 2 13,807,896 8 30,926,119 19 23,147 - 32,433,118 19 14,110,871 8 1,041,100 1 78,467,043 47 (2,455,897) (1) (1,146,932) (1) 153,398,569 92 167,206,465 100
			Amount %		Amount %
					2,027,096 1 84,678 - 4,211,470 2 1,069,910 1 1,131,327 1 178,432 - 75,759 - 8,778,672 5 4,042 - 1,617,652 1 566,283 - 853,304 1 3,041,281 2 11,819,953 7 30,935,939 19 36,264 - 32,451,689 20 14,110,871 8 1,041,100 1 79,394,603 48 (3,011,507) (2) (1,146,932) (1) 153,812,027 93 165,631,980 100

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards

Nanya Technology Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

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

(Expressed in Thousands of New Taiwan Dollars, Except Earnings Per Share)

For the three months ended September 30, 2021 2020 Amount % Amount % 4000 Operating revenue (Note 6(p)) $ 23,837,128 100 15,323,867 100 5000 Operating costs (Notes 6(g)(h)(j)(k)(n)(q) and 7) (12,101,931) (51) (11,362,124) (74) Gross profit from operations 11,735,197 49 3,961,743 26 Operating expenses (Notes 6(g)(h)(j)(k)(n)(q) and 7): 6100 Selling expenses (222,783) (1) (196,425) (1) 6200 Administrative expenses (419,637) (2) (306,864) (2) 6300 Research and development expenses (2,019,837) (8) (1,388,970) (9) Total operating expenses (2,662,257) (11) (1,892,259) (12) Net operating income 9,072,940 38 2,069,484 14 Non-operating income and expenses (Notes 6(g)(i)(j)(r) and 7): 7100 Interest income 53,294 - 108,214 - 7020 Other gains and losses, net 137,536 1 (195,324) (1) 7050 Finance costs (5,892) - (6,350) - 7060 Share of profit of associates accounted for using equity method, net 131,122 - 118,517 1 Total non-operating income and expenses 316,060 1 25,057 - 7900 Profit from continuing operations before tax 9,389,000 39 2,094,541 14 7950 Income tax expenses (Note 6(l)) (1,861,805) (8) (481,165) (3) Profit 7,527,195 31 1,613,376 11 8300 Other comprehensive income (loss) (Note 6(m)): 8310 Components of other comprehensive income (loss) income that will not be reclassified to profit or loss 8316 Unrealized losses from investments in equity instruments measured at fair value through other comprehensive income (300) - - - 8320 Share of other comprehensive income (loss) of associates accounted for using equity method, components of other comprehensive income (loss) that will not be reclassified to profit or loss (30,354) - (70,408) - 8349 Less: Income tax related to components of other comprehensive income (loss) that will not be reclassified to profit or loss (60) - - - Components of other comprehensive income (loss) that will not be reclassified to profit or loss (30,594) - (70,408) - 8360 Components of other comprehensive (loss) income that may be reclassified to profit or loss 8361 Exchange differences on translation of foreign financial statements (4,911) - (645,359) (5) 8399 Less:Income tax related to components of other comprehensive income (loss) that may be reclassified to profit or loss - - - - Components of other comprehensive (loss) income that may be reclassified to profit or loss (4,911) - (645,359) (5) 8300 Other comprehensive (loss) income, net (35,505) - (715,767) (5) 8500 Comprehensive income $ 7,491,690 31 897,609 6 Earnings per share (Note 6(o)) 9750 Basic earnings per share $ 2.44 0.53 9850 Diluted earnings per share $ 2.42 0.52	For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30, 2021 2020 Amount % Amount % 64,205,209 100 46,232,094 100 (37,724,674) (59) (33,791,981) (73) 26,480,535 41 12,440,113 27 (631,886) (1) (607,718) (1) (1,141,578) (2) (1,002,805) (2) (5,544,078) (9) (3,698,734) (9) (7,317,542) (12) (5,309,257) (12) 19,162,993 29 7,130,856 15 199,505 - 586,664 1 (88,300) - (227,315) - (17,887) - (6,917) - 386,534 1 371,083 1 479,852 1 723,515 2 19,642,845 30 7,854,371 17 (3,247,950) (5) (1,092,479) (2) 16,394,895 25 6,761,892 15 (300) - - - (14,631) - (207,159) - (60) - - - (14,871) - (207,159) - (800,850) (1) (1,207,638) (3) - - - - (800,850) (1) (1,207,638) (3) (815,721) (1) (1,414,797) (3) 15,579,174 24 5,347,095 12 5.31 2.21 5.27 2.19	For the nine months ended September 30, 2021 2020 Amount % Amount % 64,205,209 100 46,232,094 100 (37,724,674) (59) (33,791,981) (73) 26,480,535 41 12,440,113 27 (631,886) (1) (607,718) (1) (1,141,578) (2) (1,002,805) (2) (5,544,078) (9) (3,698,734) (9) (7,317,542) (12) (5,309,257) (12) 19,162,993 29 7,130,856 15 199,505 - 586,664 1 (88,300) - (227,315) - (17,887) - (6,917) - 386,534 1 371,083 1 479,852 1 723,515 2 19,642,845 30 7,854,371 17 (3,247,950) (5) (1,092,479) (2) 16,394,895 25 6,761,892 15 (300) - - - (14,631) - (207,159) - (60) - - - (14,871) - (207,159) - (800,850) (1) (1,207,638) (3) - - - - (800,850) (1) (1,207,638) (3) (815,721) (1) (1,414,797) (3) 15,579,174 24 5,347,095 12 5.31 2.21 5.27 2.19
		2020 Amount % 15,323,867 100 (11,362,124) (74) 3,961,743 26 (196,425) (1) (306,864) (2) (1,388,970) (9) (1,892,259) (12) 2,069,484 14 108,214 - (195,324) (1) (6,350) - 118,517 1 25,057 - 2,094,541 14 (481,165) (3) 1,613,376 11 - - (70,408) - - - (70,408) - (645,359) (5) - - (645,359) (5) (715,767) (5) 897,609 6 0.53 0.52	2021 Amount % 64,205,209 100 (37,724,674) (59) 26,480,535 41 (631,886) (1) (1,141,578) (2) (5,544,078) (9) (7,317,542) (12) 19,162,993 29 199,505 - (88,300) - (17,887) - 386,534 1 479,852 1 19,642,845 30 (3,247,950) (5) 16,394,895 25 (300) - (14,631) - (60) - (14,871) - (800,850) (1) - - (800,850) (1) (815,721) (1) 15,579,174 24 5.31 5.27
				2.19

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards

Nanya Technology Corporation and Subsidiaries

Consolidated Statements of Changes in Equity For the nine months ended September 30, 2021 and 2020 (Expressed in Thousands of New Taiwan Dollars)

Ordinary shares	Ordinary shares	Special reserve	Unappropriated retained earnings	O	her equity interes	Total equity
				Exchange differences on translation of foreign financial statements	Unrealized gains (losses) on financial assets measured at fair value through other comprehensive income
$ 30,733,649 - - - - - - - - - 192,470 $ 30,926,119 $ 30,935,939 - - - - - - - - 34,900 - $ 30,970,839		273,834	78,054,876 6,761,892 - 6,761,892 (982,459) (767,266) (4,600,000) - - - - 78,467,043 79,394,603 16,394,895 - 16,394,895 (768,945) (1,970,407) (4,000,000) - - - - 89,050,146	(938,039) - (1,207,638) (1,207,638) - - - - - - - (2,145,677) (2,893,732) - (800,850) (800,850) - - - - - - - (3,694,582)	(103,061) - (207,159) (207,159) - - - - - - - (310,220) (117,775) - (14,871) (14,871) - - - - - - - (132,646)	152,011,553
		- -				6,761,892 (1,414,797)
		-				5,347,095
		- 767,266 - - - - -				- - (4,600,000) 14 58,420 79 581,408
		1,041,100				153,398,569
	$ 30,935,939	1,041,100				153,812,027
	- -	- -				16,394,895 (815,721)
	-	-				15,579,174
	- - - - - 34,900 -	- 1,970,407 - - - - -				- - (4,000,000) 15 123 70,980 1,050,394
	$ 30,970,839	3,011,507				166,512,713

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards

Nanya Technology Corporation and Subsidiaries

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities:
Profit before tax
Adjustments:
Adjustments to reconcile profit:
Depreciation expense
Amortization expense
Interest expense
Interest income
Share-based payments
Share of profit of associates accounted for using equity method
Gain or loss on disposal of property, plant and equipment
Reversal of impairment loss on non-financial assets
Unrealized foreign exchange gain or loss
Others
Total adjustments to reconcile profit
Changes in operating assets and liabilities:
Notes and accounts receivable (including related parties)
Other receivables
Inventories
prepayments
Other current assets
Accounts payable (including related parties)
Other payables (including related parties)
Other current liabilities
Net defined benefit liability
Other non-current liabilities
Total net changes in operating assets and liabilities
Cash inflow generated from operations
Interest received
Interest paid
Income taxes paid
Net cash flows from operating activities
Cash flows used in investing activities:
Acquisition of financial assets at fair value through other comprehensive income
Acquisition of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Increase in refundable deposits
Acquisition of intangible assets
Decrease in lease and installment receivables
Increase in other non-current assets
Dividends received
Net cash flows used in investing activities
Cash flows used in financing activities:
Decrease in guarantee deposits received
Decrease in other payables to related parties
Payment of lease liabilities
Cash dividends paid
Exercise of employee share options
Treasury shares transferred to employees
Net cash flows used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards Nanya Technology Corporation and Subsidiaries

Notes to the Consolidated Financial Statements

September 30, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(1) Company history

Nanya Technology Corporation (the “ Company” ) was legally established with the approval of the Ministry of Economic Affairs on March 4, 1995, with registered address at No.98 Nanlin Road Dake Vil., Taishan District, New Taipei City, Taiwan. The main operating activities of the Company and its subsidiary (the “Group”) are researching, developing, manufacturing and selling semiconductor products, and the import and export of its machinery, equipment and raw materials.

(2) Approval date and procedures of the consolidated financial statements:

The consolidated financial statements were authorized for issuance by the Board of Directors on November 3, 2021.

(3) New standards, amendments and interpretations adopted:

(a) The impact of the International Financial Reporting Standards (“IFRSs”) endorsed by the Financial Supervisory Commission, R.O.C. which have already been adopted.

The Group has initially adopted the following new amendments, which do not have a significant impact on its consolidated financial statements, from January 1, 2021:

●Amendments to IFRS 4 “Extension of the Temporary Exemption from Applying IFRS 9”
●Amendments to IFRS 9, IAS39, IFRS7, IFRS 4 and IFRS 16 “Interest Rate Benchmark Reform— Phase 2”
●Amendments to IFRS 16 “Covid-19-Related Rent Concessions beyond June 30, 2021”
(b) The impact of IFRS issued by the FSC but not yet effective

The Group assesses that the adoption of the following new amendments, effective for annual period beginning on January 1, 2022, would not have a significant impact on its consolidated financial statements:

－
●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
●Amendments to IFRS 3 “Reference to the Conceptual Framework”

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The following new and amended standards, which may be relevant to the Group, have been issued by the International Accounting Standards Board (IASB), but have yet to be endorsed by the FSC:

Standards or
Interpretations
Amendments to IAS 1
“Classification of Liabilities
as Current or Non-current”
Amendments to IAS 1
“Disclosure of Accounting
Policies”
Amendments to IAS 8
“Definition of Accounting
Estimates”

Content of amendment
Effective date per
IASB
The
amendments
aim
to
promote
consistency in applying the requirements
by helping companies determine whether,
in the statement of balance sheet, debt and
other
liabilities
with
an
uncertain
settlement date should be classified as
current (due or potentially due to be settled
within one year) or non-current. The
amendments
include
clarifying
the
classification requirements for debt a
company might settle by converting it into
equity.
January 1, 2023
The key amendments to IAS 1 include:
●requiring companies to disclose their
material accounting policies rather than
their significant accounting policies;
●clarifying
that
accounting
policies
related to immaterial transactions, other
events or conditions are themselves
immaterial and as such need not be
disclosed; and
●clarifying
that
not
all
accounting
policies
that
relate
to
material
transactions, other events or conditions
are themselves material to a company’s
financial statements.
January 1, 2023
The
amendments
introduce
a
new
definition
for
accounting
estimates:
clarifying that they are monetary amounts
in the financial statements that are subject
to measurement uncertainty.
The
amendments
also
clarify
the
relationship between accounting policies
and accounting estimates by specifying that
a company develops an accounting estimate
to achieve the objective set out by an
accounting policy.
January 1, 2023

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Standards or Interpretations Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”	Content of amendment Effective date per IASB The amendments narrowed the scope of the recognition exemption so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. January 1, 2023

The Group is evaluating the impact of its initial adoption of the abovementioned standards or interpretations on its consolidated financial position and consolidated financial performance. The results thereof will be disclosed when the Group completes its evaluation.

The Group does not expect the following other new and amended standards, which have yet to be endorsed by the FSC, to have a significant impact on its consolidated financial statements:

●Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets Between an Investor and Its Associate or Joint Venture”
●IFRS 17 “ Insurance Contracts” and amendments to IFRS 17 “ Insurance Contracts”

(4) Summary of significant accounting policies:

(a) Statement of compliance

These consolidated financial statements have been prepared in accordance with the preparation and guidelines of IAS 34 “Interim Financial Reporting” which are endorsed and issued into effect by FSC and do not include all of the information required by the Regulations and International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations and SIC Interpretations endorsed and issued into effect by the FSC (hereinafter referred to IFRS endorsed by the FSC) for full annual consolidated financial statements.

The significant accounting policies adopted in the consolidated financial statements are the same as those in the consolidated financial statement for the year ended December 31, 2020. For the related information, please refer to note 4 of the consolidated financial statements for the year ended December 31, 2020.

(b) Basis of consolidation
(i) List of subsidiaries included in the consolidated financial statements:

Investor	The name of subsidiaries	Business activity		Shareholding
			September 30, 2021	December 31, 2020 September 30, 2020 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00
The Company The Company The Company The Company	NANYA TECHNOLOGY CORP. U.S.A NANYA TECHNOLOGY CORP. Delaware NANYA TECHNOLOGY CORP. H.K. NANYA TECHNOLOGY CORP. Japan	Sales of semiconductor products Design of semiconductor products Sales of semiconductor products Sales of semiconductor products	% 100.00 % 100.00 % 100.00 % 100.00

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Investor	The name of subsidiaries	Business activity		Shareholding
			September 30, 2021	December 31, 2020 September 30, 2020 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00
The Company NANYA TECHNOLOGY CORP. H.K. NANYA TECHNOLOGY CORP. H.K.	NANYA TECHNOLOGY INTERNATIONAL LTD. NANYA TECHNOLOGY CORP., Europe GmbH NANYA TECHNOLOGY CORP. Shenzhen	General investment business Sales of semiconductor products Sales of semiconductor products	% 100.00 % 100.00 % 100.00

(ii) Subsidiaries not included in the consolidated financial statements: None.
(c) Financial assets at fair value through other comprehensive income

On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent changes in the investment’ s fair value in other comprehensive income. This election is made on an instrument-by-instrument basis.

Equity instruments at FVOCI are subsequently measured at fair value. Dividends are recognized as income in profit or loss unless the dividend clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognized in other comprehensive income and are never reclassified to profit or loss.

Dividend income is recognized in profit or loss on the date on which the Group's right to receive payment is established.

(d) Employee benefits

The pension cost in the interim period was calculated and disclosed on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior fiscal year, and was adjusted according to material volatility of the market, no material reimbursement and settlement or other material one-time events since prior fiscal year.

(e) Income taxes

The income tax expenses have been prepared and disclosed in accordance with paragraph B12 of International Financial Reporting Standards 34, Interim Reporting.

Income tax expenses for the period are best estimated by multiplying pre-tax income for the interim reporting period by the effective annual tax rate as forecasted by the management. This should be recognized fully as tax expense for the current period. (and allocated to current and deferred taxes based on its proportionate size.)

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty:

The preparation of the consolidated financial statements in conformity with the Regulations and IFRSs (in accordance with IAS 34“Interim Financial Reporting” and endorsed by the FSC) requires management to make judgments, estimates and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates.

The preparation of the consolidated interim financial statements, estimates and underlying assumptions are reviewed on an ongoing basis which are in conformity with the consolidated financial statements for the year ended December 31, 2020. For the related information, please refer to note 5 of the consolidated financial statements for the year ended December 31, 2020.

(6) Explanation of significant accounts:

Except for the following disclosures, there is no significant difference as compared with those disclosed in the consolidated financial statements for the year ended December 31, 2020. Please refer to Note 6 of the 2020 annual consolidated financial statements.

(a) Cash and cash equivalents

Petty cash Checking accounts and demand deposit Cash equivalents: Time deposits Commercial paper Repurchase agreements collateralized by corporate bonds	September 30, 2021 $ 120 18,014,611 50,509,643 2,032,891 1,000,682 $ 71,557,947	December 31, 2020 108 14,820,415 34,398,887 2,014,416 492,080 51,725,906	September 30, 2020
			113 3,948,287 39,539,215 2,546,002 1,092,000
			47,125,617

Time deposits are highly liquid investment that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value, as well as are held for the purpose of meeting short term cash commitments rather than for investment or other purposes. Thereafter, they are classified as cash equivalents.

(b) Notes and accounts receivable

Accounts receivable- measured at amortized cost Accounts receivable- related parties	September 30, 2021 $ 12,961,380 - $ 12,961,380	December 31, 2020 7,867,928 8,237 7,876,165	September 30, 2020
			9,636,173 1,384
			9,637,557

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The Group applies the simplified approach to provide for its expected credit losses, i.e. the use of lifetime expected loss provision for notes and accounts receivables (including related parties). To measure the expected credit losses, notes and accounts receivables (including related parties) have been grouped based on shared credit risk characteristics and the days past due, as well as incorporated forward looking information, including macroeconomic and relevant industry information.

The loss allowance provision for notes and account receivable (including related parties) was determined as follows:

September 30, 2021	September 30, 2021
Notes and accounts receivables gross carrying amount Weighted average loss rate $ 12,714,054 - 247,326 - $ 12,961,380 December 31, 2020		Loss allowance provision
		- -
		-

		Loss allowance provision
		- -
		-

	Weighted average loss rate - -	Loss allowance provision
		- -
		-

The Group did not recognize any allowance for impairment as there were no uncollected notes and accounts receivable (including related parties) that were past due as of September 30, 2021, December 31, and September 30, 2020.

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(c) Other receivables

Tax refund receivable Lease payment receivable Overpayment receivable of water utility bill Interest receivable Others	September 30, 2021 $ 1,057,777 223,238 59,833 31,492 49,793 $ 1,422,133	December 31, 2020 1,231,318 206,450 - 29,732 28,619 1,496,119	September 30, 2020
			1,490,334 201,140 - 82,243 33,210
			1,806,927

For credit risk information, please refer to Note 6(s).

(d) Inventories

Raw materials Work in progress Finished goods	September 30, 2021 $ 549,819 6,899,129 3,421,387 $ 10,870,335	December 31, 2020 350,906 6,578,665 7,197,411 14,126,982	September 30, 2020
			340,407 6,811,477 8,303,768
			15,455,652

The Group did not recognize any loss or gain from devaluation of inventories as there was no indication of impairment or net realizable value of inventories has increased because the circumstance that caused the inventory devaluation in prior period has improved on inventories for the three months and nine months ended September 30, 2021 and 2020.

(e) Prepayments and other current assets
(i) Prepayments

Prepaid expense Prepayments to purchases (ii) Other current assets Project consumables Suppliers	September 30, 2021 $ 848,017 17,227 $ 865,244 September 30, 2021 $ 385,862 228,735 $ 614,597	December 31, 2020 556,428 3,053 559,481 December 31, 2020 676,200 283,748 959,948	September 30, 2020
			617,552 410,087
			1,027,639
			September 30, 2020
			767,265 283,561
			1,050,826

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(f) Investments accounted for using equity method

A summary of the Group’ s financial information for investments accounted for using the equity method at the reporting date is as follows:

Associates	September 30, 2021 $ 5,206,948	December 31, 2020 5,160,505	September 30, 2020
			4,871,850

The related information of the major associate to the Group was as follows:

Percentage of ownership Name of Associates Nature of Relationship to the Group Registration Country September 30, 2021 December 31, 2020 September 30, 2020 Formosa Advanced Technologies Co., Ltd. (FATC) It mainly engages in assembling and testing of module products, as well as in the research and development of integrated circuits. Taiwan % 32.00 % 32.00 % 32.00 The fair value of major associates listed on the Stock Exchange was as follows: September 30, 2021 December 31, 2020 September 30, 2020 Formosa Advanced Technologies Co., Ltd. $ 16,804,444 16,716,000 15,433,556	Nature of Relationship to the Group	Registration Country	Percentage of ownership
			September 30, 2021

The fair value of major associates listed on the Stock Exchange was as follows:

The aggregated financial information of the major associate was as follows:

The financial information of FATC was as follows:

Current assets Non-current assets Current liabilities Non-current liabilities Net asset Net asset contributed to FATC	September 30, 2021 $ 8,963,182 4,742,954 (1,298,350) (521,952) $ 11,885,834 $ 11,885,834	December 31, 2020 7,816,528 5,792,482 (1,238,254) (555,589) 11,815,167 11,815,167	September 30, 2020 6,759,313 5,903,721 (1,199,534) (566,958) 10,896,542 10,896,542

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

	For the three months ended	For the three months ended		For the nine months ended	For the nine months ended
	September 30,			September 30,
	2021	2020		2021	2020
Operating revenue $	2,448,632	2,380,770		7,449,895	7,342,406
Profit $	413,702	354,902		1,133,452	1,086,685
Other comprehensive loss	(94,857)	(220,023)		(45,722)	(647,371)
Total comprehensive income $	318,845	134,879		1,087,730	439,314
Total comprehensive income
contributed to FATC $	318,845	134,879		1,087,730	439,314
				For the nine months ended
				September 30,
				2021	2020
Share of net assets of the major	associate at January 1		$	3,780,854	3,657,624
Total comprehensive income contributed to the Group				348,073	140,580
Uncollected dividends beyond the collection period which are
reclassified to capital surplus				15	14
Cash dividends contributed to the Group				(325,475)	(311,324)
Share of net assets of major associate at September 30				3,803,467	3,486,894
Add: good will				1,463,162	1,463,162
Less: unrealized profits on upstream sales net assets of the
associates				(59,681)	(78,206)
Total carrying amount of the major associate			$	5,206,948	4,871,850

(g) Property, plant and equipment

Cost: Balance as of January 1, 2021 Additions Disposals Reclassification Effect of exchange rate change Balance as of September 30, 2021 Balance as of January 1, 2020 Additions Disposals Reclassification Effect of exchange rate change Balance as of September 30, 2020	Land $ 1,013,924 - - - - $ 1,013,924 $ 1,013,924 - - - - $ 1,013,924	Building 8,144,863 8,420 - 132,594 (165) 8,285,712 8,157,551 - (12,660) - (14) 8,144,877	Machinery and equipment 199,055,350 570,170 (150,757) 5,810,230 (1,893) 205,283,100 195,903,720 662,441 (687,930) 1,603,048 14 197,481,293	Other equipment 836,742 25,665 (10,843) 19,515 (818) 870,261 919,015 50,287 (153,594) 16,090 (138) 831,660	Under construction 6,371,857 10,084,128 - (5,962,339) - 10,493,646 2,249,124 5,508,201 - (1,787,730) - 5,969,595	Total 215,422,736 10,688,383 (161,600) - (2,876)
						225,946,643
						208,243,334 6,220,929 (854,184) (168,592) (138)
						213,441,349

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Land Accumulated depreciation / impairment: Balance as of January 1, 2021 $ - Depreciation for the period - Disposals - Reclassification - Gain from impairment loss - Effect of exchange rate change - Balance as of September 30, 2021 $ - Balance as of January 1, 2020 $ - Depreciation for the period - Disposals - Reclassification - Effect of exchange rate change - Balance as of September 30, 2020 $ - Carrying amounts: Balance as of September 30, 2021 $ 1,013,924 Balance as of December 31, 2020 $ 1,013,924 Balance as of September 30, 2020 $ 1,013,924 (h) Right-of-use assets Cost： Balance at January 1, 2021 Additions Balance at September 30, 2021 Balance at January 1, 2020 Additions Decrease Balance at September 30, 2020 Accumulated depreciation: Balance at January 1, 2021 Depreciation for the period Balance at September 30, 2021 Balance at January 1, 2020 Depreciation for the period Decrease Balance at September 30, 2020 Carrying Amount: Balance at September 30, 2021 Balance at December 31, 2020 Balance at September 30, 2020		Building Machinery and equipment 2,609,251 132,426,497 241,595 10,840,337 - (150,724) - (11,918) - (479) (142) (1,543) 2,850,704 143,102,170 2,295,380 119,651,185 239,976 10,225,074 (5,965) (687,930) - (41,963) (12) 421 2,529,379 129,146,787 5,435,008 62,180,930 5,535,612 66,628,853 5,615,498 68,334,506 Land $ 1,884,277 59,707 $ 1,943,984 $ 297,829 1,884,277 (297,829) $ 1,884,277 $ 94,085 146,793 $ 240,878 $ 198,607 146,197 (297,829) $ 46,975 $ 1,703,106 $ 1,790,192 $ 1,837,302	Building Machinery and equipment 2,609,251 132,426,497 241,595 10,840,337 - (150,724) - (11,918) - (479) (142) (1,543) 2,850,704 143,102,170 2,295,380 119,651,185 239,976 10,225,074 (5,965) (687,930) - (41,963) (12) 421 2,529,379 129,146,787 5,435,008 62,180,930 5,535,612 66,628,853 5,615,498 68,334,506 Land $ 1,884,277 59,707 $ 1,943,984 $ 297,829 1,884,277 (297,829) $ 1,884,277 $ 94,085 146,793 $ 240,878 $ 198,607 146,197 (297,829) $ 46,975 $ 1,703,106 $ 1,790,192 $ 1,837,302	Other equipment 658,368 43,068 (10,814) 11,918 - (498) 702,042 766,657 33,327 (153,594) 10,466 22 656,878 168,219 178,374 174,782 Building

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(i) Lease receivables

(i) On June 18, 2009, the Group signed an amended long-term lease agreement with Inotera Memories, Inc. (its name was changed to Micron Technology Taiwan in March, 2017, referred to as "MTTW") on the lease of building, facilities and land located on 348, 348-1 and 348-3, Hwa Ya Section, Kueishan District, Taoyuan City. This amended lease agreement, which took effect retroactively from January 1, 2009, includes the renewal term. Initial lease term is from January 1, 2009 to December 31, 2018. However, MTTW is entitled to renew this amended lease agreement for an unlimited number of consecutive additional terms of five years each, by providing a written notice with the intention to renew the lease term commencing from January 1, 2019. MTTW has completed the renewal of its lease agreement, with a written notice on December 13, 2018. In addition, MTTW has an exclusive option to purchase the leased assets (including land, building and its facilities) for a total purchase price of USD50,000 thousand on and after January 1, 2024. Also, the rental receivable for the entire year of 2009 has been waived. Initial yearly rentals for the leased land was USD1,990 thousand and leased building (including facilities) was USD 13,010 thousand from January 1, 2010 to December 31, 2018; the first yearly renewal rentals for the leased land is USD1,990 thousand and building (including facilities) is USD8,010 thousand from January 1, 2019 to December 31, 2023; the subsequent yearly renewal rentals for the leased land will be USD1,990 thousand and building (including facilities) will be USD 10 thousand commencing from January 1, 2024. The amended lease agreement for the building (including facilities) is treated as a capital lease because (a) the present value of the periodic rental payments made since the inception date is at least 90% of the market value of the leased assets and (b) the lease term is equal to 75% or more of the total estimated economic life of the leased assets. The land is treated as an operating lease.
(ii) The total lease receivable from the capital lease of the building (including facilities) was $5,185,620 thousand; the implicit interest rate was 10.56%. The cost of the leased assets at the beginning of the lease period was $2,656,223. The difference was recognized as unrealized interest revenue of $2,529,397. For the three months and nine months ended September 30, 2021 and 2020, the Group recognized the interest revenue of $13,817, $18,990, $45,446 and $60,571, respectively, from the amortization of unrealized interest revenue.

A maturity analysis of lease receivables, showing the undiscounted lease receivables to be received after the reporting date is as follows:

Less than one year One to two years Two to three years Three to four years Total lease payments receivable Unearned finance income Present value of lease payments receivable	September 30, 2021 $ 264,330 264,330 66,082 - 594,742 (57,658) $ 537,084	December 31, 2020 264,330 264,330 264,330 - 792,990 (103,104) 689,886	September 30, 2020 264,330 264,330 264,330 66,082 859,072 (120,849) 738,223

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

For credit risk information, please refer to Note 6(s).

(j) Lease liabilities

Lease liabilities
Current Non-current	September 30, 2021 $ 197,973 $ 1,526,522	December 31, 2020 178,432 1,617,652	September 30, 2020
			177,833
			1,662,485

For the maturity analysis, please refer to Note 6(s).

The amounts recognized in profit or loss were as follows:

For the three months ended September 30	For the three months ended September 30	For the nine months ended September 30	For the nine months ended September 30
2021 $ 5,892 $ 21,994	2020	2021 17,873 69,319	2020
	6,276		6,688
	25,402		67,861

The amount recognized in the statement of cash flows of the Group was as follows:

Total cash outflow for leases	For the nine months ended September 30,	For the nine months ended September 30,
	2021 $ 226,436	2020
		218,362

(i) Land lease

The Group leases its land and building with a period of 2 to 10 years. The lease included an option to terminate the contract, which is exercisable by the Group. The lease payment changes annually based on a local price index.

(ii) Other leases

The Group leases staff dorm, factory, parking lots and office spaces which are short-term leases. The Group applied the recognition exemptions and elected not to recognize its right-ofuse assets and lease liabilities for these leases.

(k) Employee benefits

(i) Defined benefit plan

Management believes that there was no material volatility of the market, no material reimbursement and settlement or other material one-time events since prior fiscal year. As a result, the pension cost in the accompanying interim period was measured and disclosed according to the actuarial report as of December 31, 2020 and 2019 .

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The expenses recognized in profit or loss for the Group were as follows:

Operating cost Operating expenses Total	For the three months ended September 30, 2021 2020 $ 1,393 1,515 969 978 $ 2,362 2,493	For the nine months ended September 30,	For the nine months ended September 30,
	2021 $ 1,393 969 $ 2,362	2021 4,204 2,879 7,083	2020 4,649 2,830 7,479

(ii) Defined contribution plans

The Group’s expenses under the pension plan cost to the Bureau of local government were as follows:

For the three months ended September 30, 2021 2020 $ 23,689 23,457 21,735 22,760 $ 45,424 46,217	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 23,689 21,735 $ 45,424	2021 71,152 67,731 138,883	2020
		70,180 63,009
		133,189

(l) Income tax

(i) The Group’s income tax expenses in the years 2021 and 2020 were as follows:

Current tax expense Current period Adjustment for prior periods Surtax on undistributed earnings Taxes on remitted earnings from subsidiary Deferred tax expense Tax expense	For the three months ended September 30, 2021 2020 $ 1,810,220 315,459 - - - - 22,524 103,526 29,061 62,180 $ 1,861,805 481,165	For the nine months ended September 30,	For the nine months ended September 30,
		2021 3,681,087 (609,355) 47,505 22,524 106,189 3,247,950	2020 1,306,335 (588,184) 171,974 103,526 98,828 1,092,479

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) The Group’s income tax gains recognized directly in other comprehensive income in the years 2021 and 2020 were as follows:

21 and 2020 were as follows:
		For the nine months ended
		September 30,
		2021	2020
Items that will not be reclassified subsequently to profit
or loss:
Unrealized gains on equity investments at fair value
through other comprehensive income	$	60	-

(iii) The Company's tax returns have been examined by the ROC tax authority through 2019.

(m) Capital and other equity

Except as described below, there was no material change in equity for the nine months ended September 30, 2021 and 2020. Please refer to Note 6(k) of the consolidated financial statements as of and for the year ended December 31, 2020 for the related detail disclosures on equity.

(i) Ordinary Share

On February 26, May 5, and August 4 2021, the Company’s Board of Directors approved to issue the Company's ordinary shares deriving from the exercise of employee share options. The Company had issued 2,841 thousand, 577 thousand and 72 thousand ordinary shares at par value, respectively, with an issuing prices of $28.5 dollars to $29.6 dollars, $28.5 dollars and $28.5 dollars to $29.6 dollars per share, which totaled $34,900. All issued shares were paid up upon issuance and the related process for registration had been completed.

For the third quarter of 2021, the Company’s ordinary shares were derived from the exercise of employee share options. Accordingly, the Company had issued 276 thousand ordinary shares, at issuing prices of $28.0 to $29.6 per share, which totaled $7,728, which was recognized as advance receipts for share capital as of September 30, 2021.

(ii) Capital surplus

Premium from the issuance of stock Treasury share transaction Employee stock option plans Expired employee stock option plans Past due unclaimed dividends Change in net equity of associates accounted for using equity method	September 30, 2021 $ 29,462,962 277,792 2,790,727 266,083 202 53 $ 32,797,819	December 31, 2020 29,398,346 - 2,790,727 262,499 79 38 32,451,689	September 30, 2020
			29,379,775 - 2,790,727 262,499 79 38
			32,433,118

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iii) Retain earning

According to the Company's Articles of Incorporation, the Company's annual net profit, after providing for income tax and covering the losses of previous years, is first set aside for legal reserve at the rate of 10% thereof until the accumulated balance of legal reserve equals the total issued capital and any special reserves pursuant to relevant laws and regulations. The remainder, plus the undistributed earnings of the previous years, are distributed or left undistributed for business purposes according to the resolution of the stockholders’dividend distribution plan, which are initially proposed by the Board of Directors and adopted by the shareholders in the annual stockholders’ meeting.

As it belongs to a highly capital-intensive industry with strong growth potential, the Company adopts a dividend distribution policy which is in line with its plans for product line expansion and the demand of fund. This policy requires that the distribution of cash dividends shall not exceed 50% of the Company's total dividend distribution every year.

1) Legal reserve

When the Group incurs no loss, it may, in pursuant to a resolution to be adopted by a shareholders’ meeting, distribute its legal reserve by issuing new shares or by cash. Only the portion of legal reserve which exceeds 25 percent of the paid-in capital may be distributed.

2) Special Reserve

In accordance with Ruling No. 1010012865 issued by the FSC on April 6, 2012, a portion of current-period earnings and undistributed prior-period earnings shall be reclassified as special earnings reserve during earnings distribution. The amount to be reclassified should equal the current-period total net reduction of other shareholders’ equity. Similarly, a portion of undistributed prior-period earnings shall be reclassified as special earnings reserve (and does not qualify for earnings distribution) to account for cumulative changes to other shareholders’ equity pertaining to prior periods. Amounts of subsequent reversals pertaining to the net reduction of other shareholders' equity shall qualify for additional distributions.

3) Earnings distribution

Earnings distribution for 2020 and 2019 were approved by the general meetings of shareholders held on August 4, 2021 and May 28, 2020, respectively. The relevant dividends distributions to shareholders were as follows:

Dividends attributable to ordinary shareholders: Cash dividends	For the year ended December 31, 2020	For the year ended December 31, 2020
	Dividends per share $ 1.30	Amount
		4,000,000

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Dividends attributable to ordinary shareholders: Cash dividends	For the year ended December 31, 2019	For the year ended December 31, 2019
	Dividends per share $ 1.50	Amount 4,600,000

(iv) Treasury shares

The Company repurchased shares from the securities exchange market based on section 28(2) of the Securities and Exchange Act and the movement in treasury shares were as follows.

In accordance with the requirements of the Company Act of Taiwan, the Company does not hold any shareholders’ rights before transferring its treasury shares.

Balance as of January 1, 2021 Transfer for the period Balance as of September 30, 2021 Balance as of January 1, 2020 (Balance as of September 30, 2020)	Transferring to employees thousand shares Amount 20,000 $ 1,146,932 (13,410) (769,018) 6,590 $ 377,914 20,000 $ 1,146,932	Transferring to employees thousand shares Amount 20,000 $ 1,146,932 (13,410) (769,018) 6,590 $ 377,914 20,000 $ 1,146,932

(v) Other equity (net of tax)

Balance as of January 1, 2021 Exchange differences on translation of foreign financial statements Unrealized losses from financial assets measured at fair value through other comprehensive income Unrealized gain from financial of assets measured at fair value through other comprehensive income, associates accounted for using equity method Balance as of September 30, 2021	Exchange differences on translation of foreign financial statements $ (2,893,732) (800,850) - - $ (3,694,582)	Unrealized loss on financial assets measured at fair value through other comprehensive income (117,775) - (240) (14,631) (132,646)	Total (3,011,507) (800,850) (240) (14,631) (3,827,228)

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Balance as of January 1, 2020 Exchange differences on translation of foreign financial statements Unrealized gain from financial of assets measured at fair value through other comprehensive income, associates accounted for using equity method Balance as of September 30, 2020	Exchange differences on translation of foreign financial statements $ (938,039) (1,207,638) - $ (2,145,677)	Unrealized losses from financial assets measured at fair value through other comprehensive income (103,061) - (207,159) (310,220)	Total (1,041,100) (1,207,638) (207,159) (2,455,897)

(n) Share-based payment

Except as described below, there was no material change on the share-based payment transactions for the nine months ended September 30, 2021 and 2020. Please refer to Note 6(l) of consolidated financial statements as of and for the year ended December 31, 2020 for related disclosures on sharebased payment transactions.

(i) As of September 30, 2021, the Group has three additions of share-based payment transactions as follows:

Grant date Grant unit Exercise price (dollar) Vesting conditions	The 1th batch of treasury shares transferred to employees 2021.1.15 3,936 $57.4 Immediately vested	The 2th batch of treasury shares transferred to employees The 3th batch of treasury shares transferred to employees 2021.2.2 2021.8.12 4,064 5,587 $57.4 $57.4 Immediately vested Immediately vested

The Group used Black-Scholes option pricing method in measuring the fair value of the sharebased payment at the grant date.

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Relevant information of employee stock option plans and the transfer of treasury shares

The Company:

	The Company:
				For	the nine months ended September 30,
				2021				2020
			Weighted-		Number of		Weighted-		Number of
			average		options		average		options
			exercise		(Thousand		exercise		(Thousand
			(price TWD)		Units)		(price TWD)		Units)
	Outstanding at January 1,	$	28.51			4,462	29.25		28,202
	Options granted		57.40			13,587	-		-
	Options exercised		52.79		(15,905)		28.52		(19,926)
	Options expired		57.40			(177)	-		-
	Options forfeited		29.10			(6)	28.55		(2,359)
	Outstanding at September 30,		28.02			1,961	28.51		5,917
	Options exercisable at September 30,		28.02			1,961	28.51		5,917
(iii)	Compensation cost
		For the three months ended				For the nine		months ended
			September 30,				September		30,
		2021			2020		2021		2020
	Compensation cost
	arising from share
	options granted to
	employees	$	-		1,860		-		58,420
	Compensation cost
	arising from treasury
	shares transferred to
	employees		49,724		-		282,969		-
	Total	$	49,724		1,860		282,969		58,420

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(o) Earnings per share

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 7,527,195 3,087,654 $ 2.44 $ 7,527,195 - 3,087,654 1,289 23,860 3,112,803 $ 2.42	2020	2021 16,394,895 3,084,679 5.31 16,394,895 3,084,679 1,594 25,132 3,111,405 5.27	2020
	1,613,376		6,761,892
	3,072,893		3,062,632
	0.53		2.21
	1,613,376		6,761,892
	- 3,072,893 3,184 8,588		3,062,632 10,073 10,586
	3,084,665		3,083,291
	0.52		2.19

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(p) Revenue from contracts with customers

(i) Disaggregation of revenue

	For the three months ended September 30, 2021	For the three months ended September 30, 2021
Manufacturing department Overseas sales department Total $ 8,111,925 313,244 8,425,169 - 965,255 965,255 156,184 546,789 702,973 41,829 104,115 145,944 8,112,578 2,507,419 10,619,997 69,597 409,124 478,721 337,054 723,379 1,060,433 - 316,978 316,978 - 103,074 103,074 139,242 97,155 236,397 170,378 611,809 782,187 $ 17,138,787 6,698,341 23,837,128 $ 17,109,070 6,698,090 23,807,160 29,717 251 29,968 $ 17,138,787 6,698,341 23,837,128 For the three months ended September 30, 2020		Total
		8,425,169 965,255 702,973 145,944 10,619,997 478,721 1,060,433 316,978 103,074 236,397 782,187
		23,837,128
		23,807,160 29,968
		23,837,128
Manufacturing department $ 3,697,795 - 138,976 15,663 6,823,689 18,989 106,614 - 6,358 56,222 6,399 $ 10,870,705	Overseas sales department 386,799 335,274 317,625 96,780 2,072,862 117,387 353,827 131,536 179,805 67,135 394,132 4,453,162	Total
		4,084,594 335,274 456,601 112,443 8,896,551 136,376 460,441 131,536 186,163 123,357 400,531
		15,323,867

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

	For the three months ended September 30, 2020	For the three months ended September 30, 2020
Manufacturing department Overseas sales department Total $ 10,829,924 4,452,898 15,282,822 40,781 264 41,045 $ 10,870,705 4,453,162 15,323,867 For the nine months ended September 30, 2021		Total
		15,282,822 41,045
		15,323,867
	Overseas sales department 1,057,090 2,430,331 1,218,223 259,532 6,474,874 724,734 1,543,740 879,703 443,889 258,406 1,780,945 17,071,467 17,070,709 758 17,071,467	Total
		22,651,195 2,430,331 1,481,943 365,831 30,272,318 842,715 2,199,238 879,703 466,239 531,185 2,084,511
		64,205,209
		64,105,925 99,284
		64,205,209

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

For the nine months ended September 30, 2020	For the nine months ended September 30, 2020	For the nine months ended September 30, 2020
Manufacturing department $ 12,647,765 - 261,367 62,417 19,847,615 51,618 374,086 - 61,094 206,033 150,483 $ 33,662,478 $ 33,557,686 104,792 $ 33,662,478 September 30, 2021 $ 12,961,380 - $ 12,961,380	Overseas sales department 1,360,838 1,131,487 927,946 340,969 5,565,690 361,404 870,558 411,723 389,236 203,572 1,006,193 12,569,616 12,568,811 805 12,569,616 December 31, 2020 7,867,928 8,237 7,876,165	Total
		14,008,603 1,131,487 1,189,313 403,386 25,413,305 413,022 1,244,644 411,723 450,330 409,605 1,156,676
		46,232,094
		46,126,497 105,597
		46,232,094
		September 30, 2020 9,636,173 1,384
		9,637,557

For details on notes and accounts receivable (including related parties), and loss allowance for impairment, please refer to note 6(b).

(q) Remuneration to employees

According to the Group's articles of incorporation, if the Group makes a profit, it should appropriate for employee compensation which is calculated based on 1% to 12% of the Group's net income before tax before deduction of employee compensation, and after offsetting accumulated deficits, if any, should be distributed as employee compensations. Employees who are entitled to receive the above-mentioned employee compensation, in shares or cash, include the employees of the subsidiaries of the Group who meet certain specific requirements.

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The estimated employee remuneration which was charged to profit or loss under operating costs or expense amounted to $635,740, $41,929, $1,572,384 and $493,822 for the three months and nine months ended September 30, 2021 and 2020, respectively. This employee remuneration was estimated based on the Company's net income before tax before deducting any employee compensation, according to the earnings allocation method as stated under the Company's articles of association. If there is any difference between the actual amounts and the estimated amounts of employee remuneration to employees after the financial reports are issued, the management of the Company is expecting that the differences will be treated as a change in accounting estimates and recognized through profit or loss in the following year.

There is no difference between the estimated amounts of employee remuneration for the year ended December 31, 2020 and 2019, and the financial statements for the year ended December 31, 2020 and 2019, which were approved by the Company's Board of Directors. Related information would be available at the Market Observation Post System website.

(r) Non-operating income and expenses
(i) Interest income

Interest income from bank deposits and short-term notes Interest income from financial lease receivables Other gains and losses Withholding tax refund Losses on disposal of property, plant and equipment Foreign exchange gains (losses) Reversal of impairment losses (impairment losses) on non- financial assets Others	For the three months ended September 30, 2021 2020 $ 39,477 89,224 13,817 18,990 $ 53,294 108,214 For the three months ended September 30, 2021 2020 $ 2,835 - - (6,671) 101,484 (228,511) (390) - 33,607 39,858 $ 137,536 (195,324)	For the three months ended September 30, 2021 2020 $ 39,477 89,224 13,817 18,990 $ 53,294 108,214 For the three months ended September 30, 2021 2020 $ 2,835 - - (6,671) 101,484 (228,511) (390) - 33,607 39,858 $ 137,536 (195,324)	For the nine months ended September 30, 2021 2020 154,059 526,093 45,446 60,571 199,505 586,664 For the nine months ended September 30, 2021 2020 45,528 - (62) (6,651) (230,947) (352,725) 479 - 96,702 132,061 (88,300) (227,315) (Continued)
		2021 2,835 - 101,484 (390) 33,607 137,536	2021 45,528 (62) (230,947) 479 96,702 (88,300)
	$ $

(ii) Other gains and losses

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iii) Finance costs

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 5,892 - - $ 5,892	2020	2021 17,873 - 14 17,887	2020
	6,276 27 47		6,688 87 142
	6,350		6,917

(s) Financial instruments

Except for the contention mentioned below, there was no significant change in the fair value of the Group's financial instruments and degree of exposure to credit risk, liquidity risk and market risk arising from financial instruments. For the related information, please refer to note6(q) of the consolidated financial statements for the year ended December 31, 2020.

(i) Credit risk of receivables

For credit risk exposure of notes and accounts receivables (including related parties), please refer to note 6(b).

Other financial assets at amortized cost includes other receivables, time deposits and refundable deposits.

Considering that the Group deals only with other external parties with good credit standing and with the above investment grade financial institutions, all of the above financial assets are considered to have low credit risk.

As of September 30, 2021, December 31 and September 30, 2020, no allowance for impairment was provided because there was no indication of credit-impaired for the 12-month ECL or lifetime ECL allowance for other financial assets measured at amortized cost.

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Liquidity risk

The following are the remaining contractual maturities at the end of the reporting period of financial liabilities, including estimated interest payments but excluding the impact of netting agreements:

September 30, 2021 Non-derivative financial liabilities Accounts payable (including related parties) Other payables (including related parties) Lease liabilities (including current portion) December 31, 2020 Non-derivative financial liabilities Accounts Payable (including related parties) Other payable (including related parties) Lease liabilities (including current portion) September 30, 2020 Non-derivative financial liabilities Financing from other related parties Accounts payable (including related parties) Other payables (including related parties) Lease liabilities- current		Carrying amount $ 6,417,948 7,380,503 1,724,495 $ 15,522,946 $ 2,111,774 5,281,380 1,796,084 $ 9,189,238 $ 3,406 4,077,641 5,420,501 1,840,318 $ 11,341,866	Contractual cash flow 6,417,948 7,380,503 1,827,099 15,625,550 2,111,774 5,281,380 1,914,405 9,307,559 3,511 4,077,641 5,420,501 1,964,784 11,466,437	Within 6 months 6,417,948 7,380,503 109,964 13,908,415 2,111,774 5,281,380 100,758 7,493,912 - 4,077,641 5,420,501 100,758 9,598,900	6-12months - - 109,964 109,964 - 100,758 100,758 3,511 - - 100,758 104,269	1-2years - - 219,878 219,878 - 201,516 201,516 - - - 201,517 201,517	2-5years - - 624,213 624,213 - 604,549 604,549 - - - 806,065 806,065	Over 5 years
								- - 763,080
								763,080
								- 906,824
								906,824
								- - - 755,686
								755,686

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.

(iii) Market risk

1) Exposure to currency risk

The Group's significant exposure to foreign currency risk was as follows:

Financial assets: Monetary items USD JPY EUR HKD Financial liabilities: Monetary items USD JPY EUR	September 30, 2021	September 30, 2021	New Taiwan Dollars 21,915,299 478,961 969 77,248 3,288,495 395,158 3,877,898	De	cember 31, 2020	New Taiwan Dollars 8,538,574 209,992 1,452 5,000 3,282,411 346,675 5,184	September 30, 2020	September 30, 2020
	Foreign currency (in thousands) $ 786,453 1,925,086 30 21,588 $ 118,011 1,588,257 120,045	Exchange rate (dollars) 27.866 0.2488 32.3037 3.5783 27.866 0.2488 32.3037		Foreign currency (in thousands) 299,515 770,896 42 1,379 115,140 1,272,668 150	Exchange rate (dollars) 28.508 0.2724 34.5600 3.6257 28.508 0.2724 34.5600		Foreign currency (in thousands) 395,950 17,783 105 767,790 146,068 4,536,290 921	Exchange rate (dollars) New Taiwan Dollars 29.126 11,532,440 0.2744 4,880 34.0506 3,575 3.7416 2,872,763 29.126 4,254,377 0.2744 1,244,758 34.0506 31,361

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The Group's exposure to foreign currency risk arises from the translation of the foreign currency exchange fluctuations on cash and cash equivalents, accounts receivable, accounts payable (including related parties) and other payable (including related parties) which are denominated in different foreign currencies. A 1% appreciation and depreciation of the TWD against the USD, JPY, EUR and HKD as of September 30, 2021 and 2020 would have decreased and increased the net income before tax by $149,109 and $88,832 for the nine months ended September 30, 2021 and 2020, respectively. This analysis assumes that all other variables remain constant and ignores any impact of forecasted sales and purchases. The analysis is performed on the same basis as prior year.

Since the Group has many kinds of functional currency, the information on foreign exchange loss on monetary items is disclosed by total amount. For the nine months ended September 30, 2021 and 2020, foreign exchange loss (including realized and unrealized portions) amounted to $230,947 and $352,725, respectively.

(iv) interest rate analysis

Please refer to the notes on liquidity risk management and interest rate exposure of the Group's financial liabilities.

The following sensitivity analysis is based on the exposure to the interest rate risk of derivative and non-derivative financial instruments on the reporting date. Regarding liabilities with variable interest rates, the analysis is based on the assumption that the amount of liabilities outstanding at the reporting date was outstanding throughout the year. The rate of change is expressed as the interest rate increases by 1% when reporting to management internally, which also represents the Group management's assessment of the reasonably possible interest rate change.

If the interest rate had increased and decreased by 1 basis points, the Group’ s net income would have increased or decreased by $0 and $34 for the nine months ended September 30, 2021 and 2020 with all other variable factors remaining constant. This is mainly due to the Group’s borrowing at variable rates and investment in variable-rate bills.

Prices of securities at the reporting date Increase 1% Decrease 1%	For the nine months ended September 30,
	2021 2020 Other comprehensive income after tax Other comprehensive income after tax $ 46 - (46) -

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(v) Fair value information

1) Types and fair value of financial instruments

The Group’s financial assets measured at fair value through other comprehensive income was measured on a recurring basis. The carrying amount and fair value of the Group's financial assets and liabilities (including the information on fair value hierarchy; but excluding financial instruments were not measured at fair value whose carrying amount were reasonably close to the fair value, and lease liabilities, disclosure of fair value information is not required) were as follows:

	September 30, 2021	September 30, 2021	September 30, 2021
Book Value $ 5,700 $ 71,557,947 12,961,380 1,198,895 537,084 $ 86,255,306 $ 6,417,948 7,380,503 1,724,495 $ 15,522,946	Level 1 - - - - - - - - - -	Fair Value
		Level 2 - - - - - - - - - -	Level 3 5,700 - - - - - - - - -	Total 5,700
				- - - -
				-
				- - -
				-

	December 31, 2020	December 31, 2020	December 31, 2020
Book Value $ 51,725,906 7,876,165 1,289,669 689,886 $ 61,581,626 $ 2,111,774 5,281,380 1,796,084 $ 9,189,238	Level 1 - - - - - - - - -	Fair Value
		Level 2 - - - - - - - - -	Level 3 - - - - - - - - -	Total - - - -
				-
				- - -
				-

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

	September 30, 2020	September 30, 2020	September 30, 2020
Book Value $ 47,125,617 9,637,557 1,605,787 738,223 $ 59,107,184 $ 4,077,641 5,423,907 1,840,318 $ 11,341,866	Level 1 - - - - - - - - -	Fair Value
		Level 2 - - - - - - - - -	Level 3 - - - - - - - - -	Total - - - -
				-
				- - -
				-

2) Valuation techniques for financial instruments measured at fair value

The category and attribute of the Group's financial instruments without an active market were as follows:

Equity instruments without an active market price: Measurements of fair value of financial instruments without an active market price are calculated using the net asset value method, which is measured according to the main assumption based on the equity value of the investee’s net asset. The estimation has already been adjusted in accordance with the discount on the lack of marketability of the equity stock
3) Transfer between levels

For the nine months ended September 30, 2021 and 2020, there was no transfer from financial assets.

4) Reconciliation of Level 3 fair values

Balance as of January 1, 2021 Purchased Total losses recognized in other comprehensive income Balance as of September 30, 2021 Balances as of January 1, 2020 (and September 30, 2020)	Fair value through other comprehensive income Unquoted equity instruments $ - 6,000 (300) $ 5,700 $ -

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

For the years ended September 30, 2021 and 2020, total losses that were included in “ unrealized losses from existing financial assets at fair value through other comprehensive income” were as follows:

mprehensive income” were as follows:
Total losses recognized in other comprehensive income, and presented in “unrealized losses from financial assets at fair value through other comprehensive income”	For the nine months ended September 30
	2021	2020
	$ 240	-

5) Quantified information on significant unobservable inputs (Level 3) used in fair value measurement

The Group’s financial instruments that use Level 3 inputs to measure fair value “fair value through other comprehensive income – equity investments”.

The Group’s investment in equity instruments without an active market have only one significant unobservable input.

Quantified information of significant unobservable inputs was as follows:

Item Financial assets at fair value through other comprehensive income equity investments without an active market	Valuation technique Asset method	Significant unobservable inputs Inter-relationship between significant unobservable inputs and fair value measurement ‧Net asset value ‧The discount rate due to lack of marketability as of September 30, 2021 was 5% ‧The higher the discount for lack of marketability, the lower the fair value.

6) Fair value measurement in Level 3 - sensitivity analysis of the possible alternative assumptions

The valuation models and assumptions used to measure the fair value of the financial instruments is reasonable. However, the use of different valuation models or assumptions may result in different measurements. The effects of changes in assumptions for financial instruments, whose fair value measurements were categorized as Level 3, were as follows:

September 30, 2021 Financial assets at fair value through other comprehensive income equity investments without an active market	Inputs Discount for lack of marketability	Increase or decrease 1%	Effects of changes in fair value on other comprehensive income
			Favorable change Unfavorable change 48 (48)

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The favorable and unfavorable effects represent the changes in fair value, and fair value is based on a variety of unobservable inputs calculated using a valuation technique. The analysis above only reflects the effects of changes in a single input, and it does not include the interrelationships with another input.

(t) Financial risk management

There were no significant changes in the Group's financial risk management and policies as disclosed in Note 6(r) of the consolidated financial statements for the year ended December 31, 2020.

(u) Capital management

Management believes that the objectives, policies and processes of capital management of the Group has been applied consistently with those described in the consolidated financial statements for the year ended December 31, 2020. Also, management believes that there were no significant changes in the Group's capital management information as disclosed for the year ended December 31, 2020. Please refer to Note 6(s) of the consolidated financial statements for the year ended December 31, 2020 for further details.

(v) The investing and financing activities on non-cash transactions

The Group's investing and financing activities on non-cash transactions for the nine months ended September 30, 2021 and 2020 were as follows:

(i) Acquisition of right-of-use assets by lease, please refer to Note6(h).

(ii)

Acquisition of property, plant and equipment Add: Payables on equipment at beginning of period Less: Payables on equipment at end of period Others Cash Paid	For the nine months ended September 30, 2021 2020 $ 10,688,383 6,220,929 693,313 973,002 (4,862,779) (2,099,018) - (167,843) $ 6,518,917 4,927,070
	2021
	$ 10,688,383 693,313 (4,862,779) - $ 6,518,917

(iii) Reconciliation of liabilities arising from financing activities was as follow:

Non-Cash changes	Non-Cash changes	Non-Cash changes	September 30, 2021
Change in an index of lease payment Additions Decreased by other payables 17,429 50,459 (296) Non-Cash changes
			1,724,495
			September 30, 2020
Additions 1,884,277	Increased by other payables (70)	Interest expense 412
			1,840,318

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(7) Related-party transactions:

(a) Names and relationship with related parties

The following are entities that have had transactions with related party during the periods covered in the consolidated financial statements.

Name of related party Relationship with the Group Formosa Petrochemical Corporation The Group's other related parties Nan Ya Photonics Incorporation The Group's other related parties Formosa Technologies (Nanjing) Corporation The Group's other related parties Formosa Sumco Technology Corporation The Group's other related parties Formosa Advanced Technologies Co., Ltd. The Group's associates (referred to as "FATC") Formosa Technologies Corporation The Group's other related parties Formosa Biomedical Technology Corp. The Group's other related parties Formosa Plastics Corporation The Group's other related parties Formosa Waters Technology Co., Ltd. The Group's other related parties Nan Ya Plastics Corporation

The Group's other related parties The Group's other related parties The Group's other related parties The Group's other related parties The entity with significant influence over the Group

(b) Significant transactions with related parties
(i) Sales to related parties

Relationship	Sales For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ - 1,337 - 1,337	Sales For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ - 1,337 - 1,337	Sales For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ - 1,337 - 1,337	Accounts receivable to related parties	Accounts receivable to related parties	Accounts receivable to related parties	Accounts receivable to related parties
	For the three months ended September 30,
	2021 $ -	2020 1,337	2021 -	September 30, 2021	December 31, 2020		September 30, 2020 1,384
Associates				-		8,237

The terms and pricing of sales with associates were not significantly different from normal selling price, which is collected every15th of the following month. Amounts receivable from related parties were uncollateralized, and no expected credit loss were required after the assessment by the management.

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Purchase from related parties

Relationship	Purchases For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ 29,932 18,447 84,821 62,499 121 37 852 801 171,866 151,799 513,896 453,248 72,243 64,968 208,733 166,026 $ 274,162 235,251 808,302 682,574	Purchases For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ 29,932 18,447 84,821 62,499 121 37 852 801 171,866 151,799 513,896 453,248 72,243 64,968 208,733 166,026 $ 274,162 235,251 808,302 682,574	Purchases For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ 29,932 18,447 84,821 62,499 121 37 852 801 171,866 151,799 513,896 453,248 72,243 64,968 208,733 166,026 $ 274,162 235,251 808,302 682,574	Accounts	payable to related parties	payable to related parties
	For the three months ended September 30,
	2021 $ 29,932 121 171,866 72,243 $ 274,162	2020 18,447 37 151,799 64,968	2021 84,821 852 513,896 208,733 808,302	September 30, 2021	December 31, 2020 9,686 - 71,257 3,735 84,678	September 30, 2020
Entities with significant influence over the Group Associates Other related parties: Formosa Sumco Technology Corporation Other related parties				12,049 - 108,174 9,227		5,882 - 100,175 3,836
		235,251		129,450		109,893

The terms and pricing of purchase transactions with related parties were not significantly different from those offered by other vendors. The payment terms ranged from one to two months, which were no different from the payment terms given by other vendors.

(iii) Consigned out for processing

Amount For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ 1,953,428 1,701,480 5,782,108 5,463,007	Amount For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ 1,953,428 1,701,480 5,782,108 5,463,007	Amount For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 $ 1,953,428 1,701,480 5,782,108 5,463,007	Other payables to related parties	Other payables to related parties	Other payables to related parties
For the three months ended September 30,
2021 $ 1,953,428	2020 1,701,480	2021	September 30, 2021 1,255,442	December 31, 2020 1,049,080	September 30, 2020
		5,782,108			1,022,841

The term of transactions with the related parties above is 60 days after the end of each month when processed consigned goods are received.

(iv) Financing from related parties

Financial costs For the three months ended September 30 For the nine months ended September 30 2021 2020 2021 2020 $ - 27 - 87	Financial costs For the three months ended September 30 For the nine months ended September 30 2021 2020 2021 2020 $ - 27 - 87	Financial costs For the three months ended September 30 For the nine months ended September 30 2021 2020 2021 2020 $ - 27 - 87	Financial costs For the three months ended September 30 For the nine months ended September 30 2021 2020 2021 2020 $ - 27 - 87
For the three months ended September 30
2021 $ -	2020	2021 -
	27		87

Relationship		Other payables to	related parties
	Balan	ce of borrowings December 31, 2020 September 30, 2020 - 3,406	I September 30, 2021 -	nterest payabl	e
	September 30, 2021 $ -	December 31, 2020 -		December 31, 2020 -	September 30, 2020
Other related parties: Formosa Technologies (Nanjing) Corporation					30

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(v) Property transactions
1) Acquisition of equipment

		Other payables to related parties	Other payables to related parties	Other payables to related parties
				September 30, 2020
				24,650 -
				24,650

For the three months ended September 30,		For the six months ended September 30,
2021 $ 16,805	2020		2021 2020 49,743 45,940
	15,311

(vi) Leases

The rentals charged to the entities with significant influence over the Company are determined based on the local market prices, and rents are paid monthly.

The Group entered into 9 to 10 years lease agreements between July and August 2020, as well as a 3-year lease agreement in July 2017, with Nan Ya Plastics Corporation, at the total values of $2,015,018 and $617,862, respectively. Also, for the three months and nine months ended September 30, 2021 and 2020, the Group recognized the amount of $5,752, $6,276, $17,690 and $6,688, as interest expense, respectively. Furthermore, as of September 30, 2021, December 31 and September 30, 2020, the balance of lease liabilities amounted to $1,678,751, $1,796,084 and $1,840,318, respectively.

For the nine months ended September 30, 2021 and 2020, the Group recognized the additions of the right-of-use asset amounting to $0 and $1,884,277, respectively. For the details of rightof-use asset, please refer to Note6(h).

(vii) Others

Other income	Other income	Other income
For the three months ended September 30,		For the six months ended September 30
2021 $ 122	2020	2021 2020 602 2,476
	2,476

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(c) Key management personnel compensation

Key management personnel compensation comprised:

For the nine months ended September 30, 2021 2020 $ 30,982 42,028 5,696 - $ 36,678 42,028	For the nine months ended September 30, 2021 2020 $ 30,982 42,028 5,696 - $ 36,678 42,028	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 30,982 5,696 $ 36,678		2021 53,964 5,696 59,660	2020
	42,028 -		66,850 702
	42,028		67,552

Please refer to Note 6(n) for the details of share-based payment.

(8) Pledged assets:

The Group’s assets pledged to secure loans are as follows:

Pledged assets Other non-current assets Other non-current assets	Object	September 30, 2021 $ 5,436 - $ 5,436	December 31, 2020 5,573 - 5,573	September 30, 2020
	Office leasing Remitted funds for investment plan			4,985 926,032
				931,017

(9) Commitments and contingencies:

(a) Significant commitments

Guarantees for importation goods provided by bank Unused letters of credit Total	September 30, 2021 $ 835,000 106,072 $ 941,072	December 31, 2020 935,000 660,779 1,595,779	September 30, 2020
			935,000 295,299
			1,230,299

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(b) Contingent liabilities
(i) In 2000, the Company was charged by Brazil's Ministry of Justice as being involved in the International Monopolies, which influences Brazil's DRAM market. Consequently, the Company, other large international companies and individuals are investigated at the same time. The lawsuit was in a court hearing. The Company has engaged counsels to properly handle it to ensure the Company's rights.
(ii) In October 2016, Lone Star Silicon Innovations LLC (Lone Star) filed a lawsuit against Nanya Technology Corp. (Nanya) and two of its subsidiaries, Nanya Technology Corp., USA (NTC USA) and Nanya Technology Corp., Delaware (NTC Delaware), to the US District Court of East Texas for patent infringement. The lawsuit was dismissed in April 2021, therefore it was closed.
(iii) In November 2019, Monterey Research LLC (Monterey) filed a lawsuit against Nanya Technology Corp. (Nanya) and two of its subsidiaries, Nanya Technology Corp., USA (NTC USA) and Nanya Technology Corp., Delaware (NTC Delaware), to the US District Court of Delaware for patent infringement. The Company has engaged counsels to properly handle it to ensure the Company's rights.
(iv) The original Joint Venture agreement signed by the Company, Micron Technology, Inc. and its related parties was terminated after Micron Semiconductor Co. completed its share-swap with Micron Technology Taiwan. Both parties had mutually agreed to sign a cooperation agreement, the details of the agreement were as follows:
- 1) The estimated cost for improving specific environmental safety and factory facilities in mutually operating period of joint venture agreement amounted to US$54,030 thousand; the Company agreed to share the 50% portion of the total costs and accrued it as expense of $850,000 (USD27,015 thousand) to other payable. The Company will share the cost based on the actual amounts at the appointed time. As of September 30, 2021 and 2020, the payment amounting to $ 357,800 and $200,950 had been recognized by the Company.
- 2) The Company agreed to share the 50% portion of the total losses for penalty, improving costs and suspending operation before the date of share-swap in the following two to five years due to an existing event of environmental safety and factory facilities which violated the laws.

(10) Losses Due to Major Disasters: None

(11) Subsequent Events: None

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(12) Other:

(a) A summary of current-period employee benefits, depreciation, and amortization, by function, is as follows:

follows:
	For the three months ended September 30, 2021			For the three months ended September 30, 2020
	Cost of goods sold	Operating expenses	Total	Cost of goods sold	Operating expenses	Total
Employee benefits Salaries Labor and health insurance Pension expenses Remuneration of directors Other personnel expenses Depreciation expenses Amortization expenses	1,037,822 52,243 25,082 - 17,606 3,701,152 65,229	788,781 48,081 22,704 1,750 8,151 126,318 -	1,826,603 100,324 47,786 1,750 25,757 3,827,470 65,229	651,474 48,306 24,972 - 18,235 3,419,986 126,831	561,786 42,495 23,738 1,550 8,092 110,155 1,267	1,213,260 90,801 48,710 1,550 26,327 3,530,141 128,098

	For the nine months ended September 30, 2021	For the nine months ended September 30, 2021	For the nine months ended September 30, 2021	For the nine months ended September 30, 2020	For the nine months ended September 30, 2020	For the nine months ended September 30, 2020
	Cost of goods sold	Operating expenses	Total	Cost of goods sold	Operating expenses	Total
Employee benefits Salaries Labor and health insurance Pension expenses Remuneration for directors Other personnel expenses Depreciation expenses Amortization expenses	3,024,286 156,440 75,356 - 52,946 10,904,458 195,167	2,292,218 142,011 70,610 4,870 24,454 367,908 -	5,316,504 298,451 145,966 4,870 77,400 11,272,366 195,167	2,300,147 146,506 74,829 - 55,039 10,322,877 171,657	1,713,279 122,715 65,839 4,800 21,818 321,697 1,267	4,013,426 269,221 140,668 4,800 76,857 10,644,574 172,924

(b) Seasonal operation:

The Group's operation is not affected by seasonal or cyclical factor.

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements

(13) Other disclosures:

(a) Information on significant transactions:

The followings were the information on significant transactions required by the “ Regulations Governing the Preparation of Financial Reports by Securities Issuers” for the Group for the nine months ended September 30, 2021:

(i) Loans to other parties: None
(ii) Guarantees and endorsements for other parties: None
(iii) Securities held at the reporting date (excluding investment in subsidiaries, associates and joint ventures):

(In Thousands of New Taiwan Dollars)

Name of holder The Company	Category and name of security	Relationship with company	Account title	Endingbalance	Endingbalance	Endingbalance	Endingbalance	Note
				Shares/Units (thousands)	Carrying value	Percentage of ownership (%)	Fair value
	Mesh Cooperative Ventures Fund LP	-	Financial assets at fair value through other comprehensive income －non-current	-	5,700	% 2.46	5,700

(iv) Information regarding purchase or sale of securities for the period exceeding $300 million or 20% of the capital stock: None
(v) Acquisition of individual real estate with amount exceeding $300 million or 20% of the Company's paid-in capital: None
(vi) Disposal of individual real estate with amount exceeding $300 million or 20% of the Company's paid-in capital: None
(vii) Related-party transaction for purchases and sales for which amounts exceeding $100 million or 20% of the Company's paidin capital:

(In Thousands of New Taiwan Dollars)

Name of company	Related party	Nature of relationship	Transaction details	Transaction details	Transaction details	Transaction details	Transactions different fr	with terms om others	Notes/Accounts receivable (payable)	Notes/Accounts receivable (payable)	Note
			Purchase /Sale	Amount	Percentage of total purchases/sales	Payment terms	Unit price	Payment terms	Ending balance	Percentage of total notes/accounts receivable (payable)
The Company The Company The Company The Company Nanya Technology Corp., Delaware Nanya Technology Corp., U.S.A Nanya Technology Corp., Japan Nanya Technology Corp., Europe GmbH Nanya Technology Corp., HK The Company The Company	Nanya Technology Corp., U.S.A. Nanya Technology Corp., Japan Nanya Technology Corp., Europe GmbH Nanya Technology Corp., HK Nanya Technology Corp Nanya Technology Corp Nanya Technology Corp Nanya Technology Corp Nanya Technology Corp Formosa Sumco Technology Corporation Formosa Biomedical Technology Corporation	Subsidiary Subsidiary Subsidiary subsidiary The parent company The parent company The parent company The parent company The parent company Other related parties Other related parties	(Sale) (Sale) (Sale) (Sale) (Sale) Purchase Purchase Purchase Purchase Purchase Purchase	(8,409,649) (4,486,254) (3,728,770) (126,089) (320,878) 8,409,649 4,486,254 3,728,770 126,089 513,896 150,122	(13.16)% (7.02)% (5.84)% (0.20)% (100.00)% 100.00% 100.00% 100.00% 100.00% 5.66% 1.65%	O/A 60~90Days O/A 180Days O/A 60~90Days O/A 60~90 Days O/A 60~90 Days O/A 60~90Days O/A 180Days O/A 60~90Days O/A 60~90Days O/A 60Days Payment after arrival and inspection of good	- - - - - - - - - - -		3,030,678 756,660 1,080,459 33,825 30,764 (3,030,678) (756,660) (1,080,459) (33,825) (108,174) (4,893)	23.08% 5.76% 8.23% 0.26% 100.00% (100.00)% (100.00)% (100.00)% (100.00)% (1.69)% (0.08)%	(Note) (Note) (Note) (Note) (Note) (Note) (Note) (Note) (Note) - -

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements

Note: The transactions were written off in the consolidated financial statements.

(viii) Receivables from related parties with amounts exceeding $100 million or 20% of the Company's paid-in capital:

(In Thousands of New Taiwan Dollars)

Name of company	Counter-party	Nature of relationship	Ending balance of accounts receivable from related parties	Turnover rate	Overdue	Overdue	Amounts received in subsequent period	Allowance for bad debts
					Amount	Action taken
The Company The Company The Company	Nanya Technology Corp., U.S.A. Nanya Technology Corp., Japan Nanya Technology Europe GmbH	Subsidiary Subsidiary Subsidiary	3,030,678 756,660 1,080,459	5.02 7.99 6.43	- - -	- - -	1,322,876 380,518 330,213	- - -

Note: the transactions were written off in the consolidated financial statements.

(ix) Trading in derivative instruments: None
(x) Business relationships and significant intercompany transactions:

(In Thousands of New Taiwan Dollars)

				(In Thousands of New Taiwan Dollars)	(In Thousands of New Taiwan Dollars)	(In Thousands of New Taiwan Dollars)	(In Thousands of New Taiwan Dollars)
No.	Name of company	Name of counter-party	Nature of relationship	Intercompany transactions
				Account name	Amount	Trading terms	Percentage of the consolidated net revenue or total assets
0 0 0 0 1 0 0 0 0 1	Nanya Technology Corp. Nanya Technology Corp. Nanya Technology Corp. Nanya Technology Corp Nanya Technology Corp.Delaware Nanya Technology Corp. Nanya Technology Corp. Nanya Technology Corp. Nanya Technology Corp. Nanya Technology Corp.Delaware	Nanya Technology Corp., U.S.A Nanya Technology Corp., Japan Nanya Technology Europe GmbH Nanya Technology Corp. HK Nanya Technology Corp. Nanya Technology Corp., U.S.A Nanya Technology Corp., Japan Nanya Technology Europe GmbH Nanya Technology Corp. HK Nanya Technology Corp.	1 1 1 1 2 1 1 1 1 2	Sales Sales Sales Sales Sales Accounts receivable Accounts receivable Accounts receivable Accounts receivable Accounts receivable	8,409,649 4,486,254 3,728,770 126,089 320,878 3,030,678 756,660 1,080,459 33,825 30,764	On the basis of general conditions On the basis of general conditions On the basis of general conditions On the basis of general conditions On the basis of general conditions On the basis of general conditions On the basis of general conditions On the basis of general conditions On the basis of general conditions On the basis of general conditions	13.10% 6.99% 5.81% 0.20% 0.50% 1.63% 0.41% 0.58% 0.02% 0.02%

Note 1: Assigned numbers represent the following:

0 represents the parent company.
The subsidiaries are represented numerically starting from 1.

Note 2: The terms of transactions are defined as follows:

Parent company to subsidiary.
Subsidiary to parent company.
Subsidiary to Subsidiary.
Note 3: The business relationship and significant transactions between the parent company and the subsidiary only disclose the importations of sales and account receivable, did not repeat about the purchase and account payable.

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements

(b) Information on investees (excluding information on investees in Mainland China):

The following is the information on investees for the nine months ended September 30, 2021:

(In Thousands of New Taiwan Dollars / Shares)

Name of investor	Name of investee	Location	Main businesses and products	Original investment amount	Original investment amount	Balance as of September 30, 2021	Balance as of September 30, 2021	Balance as of September 30, 2021	Net income of investee	Share of profits of investee	Note
				September 30, 2021	December 31, 2020	Shares	Percentage of ownership	Carrying value
The Company The Company The Company The Company The Company The Company Nanya Technology Corp., HK	Nanya Technology Corp., U.S.A. Nanya Technology Corp., Delaware Nanya Technology Corp., HK Nanya Technology Corp., Japan Nanya Technology International, Ltd. Formosa Advanced Technologies Co., Ltd. Nanya Technology Europe GmbH	U.S.A U.S.A Hong Kong Japan British Virgin Island Yunlin Germany	Sales of semiconductor products Design of semiconductor products Sales of semiconductor products Sales of semiconductor products General investment business Assembling, testing and producing modules for IC Sales of semiconductor products	20,392 36,005 66,271 20,161 48,145,600 5,099,482 30,056	20,392 36,005 66,271 20,161 37,004,400 5,099,482 30,056	2 - 20 1 2 141,511 -	% 100.00 % 100.00 % 100.00 % 100.00 % 100.00 % 32.00 % 100.00	174,210 183,774 91,235 291,104 44,618,105 5,206,948 87,632	21,128 15,770 25,812 143,847 114,812 1,133,452 21,836	21,128 15,770 25,812 143,847 114,812 386,534 21,836	(Note1) (Note1) (Note1) (Note1) (Note 1) (Note 2) (Note1)

Note: (1) The transactions were written off in the consolidated financial statements.

(2) Investment accounted for using equity method.

(c) Information on investment in mainland China:

(i) The names of investees in Mainland China, the main businesses and products, and other information:

(In Thousands of New Taiwan Dollars)

Name of investee	Main businesses and products	Total amount of paid-in capital	Method of investment	Accumulated outflow of investment from Taiwan as of January 1, 2021	Investment flows	Investment flows	Accumulated outflow of investment from Taiwan as of September 30, 2021	Net income (losses) of the investee	Percentage of ownership	Investment income (losses)	Book value	Accumulated remittance of earnings in current period
					Outflow	Inflow
Nanya Technology Corp., Shenzhen	Sales of semiconductor products	27,448 (USD985 thousand	) (2)	27,448 (USD985 thousand)	-	-	27,448 (USD985 thousand)	3,055	100.00%	3,055 (Note 2)	21,960	-

Note 1：Three types of investments were as follows:

(1) Investing directly in Mainland China
(2) Investing the companies in Mainland China through third parties.
(3) Others

Note 2：The financial statements were reviewed by a certified public accountant of the Taiwanese parent company.

Note3：The transactions were written off in thee consolidated financial statements.

(ii) Limitation on investment in Mainland China:

(In Thousands of New Taiwan Dollars)

Accumulated Investment in Mainland China as of September 30, 2021 (Note 1)	Investment Amounts Authorized by Investment Commission, MOEA (Note 1)	Upper Limit on Investment (Note 2)
27,448 (USD985 thousand)	27,448 (USD985 thousand)	99,907,628

Note 1：The exchange rate of New Taiwan dollars to US dollars on September 30, 2021 was USD1：TWD 27.866 Note 2：60% of net equity.

(iii) Significant transactions: None

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements

(d) Information on major shareholders:

Shareholding Shareholder’s Name	Shares	Percentage
Nan Ya Plastics Corporation	907,303,775	% 29.29
Formosa Chemicals & Fibre Corporation	334,815,409	% 10.80
Formosa Plastics Corporation	334,815,409	% 10.80
Formosa Petrochemical Corp	334,815,409	% 10.80

Note 1: The information on major shareholders, which is provided by the Taiwan Depository & Clearing Corporation, summarized the shareholders who held over 5% of total non-physical ordinary shares and preference shares (including treasury shares) on the last business date of each quarter. The actual registered non-physical shares may be different from the capital shares disclosed in the financial statement due to different calculation basis.
Note 2: If shares are entrusted, the above information regarding such shares will be revealed by each trustors of individual trust ac count. The shareholders holding more than 10% of the total shares of the company should declare insider’ s equity according to Securities and Exchange Act. The numbers of the shares declared by the insider include the shares of the trust assets which the insider has discretion over use. For details of the insider’s equity announcement please refer to the TWSE website.

(14) Segment information:

Segment information:
Revenue: From external customers From sales among intersegments Total revenue Reportable segment profit or loss Revenue: From external customers From sales among intersegments Total revenue Reportable segment profit or loss Revenue: From external customers From sales among intersegments Total revenue Reportable segment profit or loss		For the three months ended September 30,			2021
	Overseas sales division $ 6,698,341 8,692 $ 6,707,033 $ 39,485	Overseas R&D division Manufacturing divisions Investment divisions - 17,138,787 - 121,853 6,588,889 - 121,853 23,727,676 - 5,908 9,388,573 32,111 For the three months ended September 30,			Adjustments and eliminated - (6,719,434) (6,719,434) (77,077) 2020	Total
						23,837,128 -
						23,837,128
						9,389,000

		Overseas R&D division Manufacturing divisions Investment divisions Adjustments and eliminated - 10,870,705 - - 138,666 4,294,081 - (4,443,736) 138,666 15,164,786 - (4,443,736) 6,884 2,094,265 80,644 (86,538) For the nine months ended September 30, 2021				Total
						15,323,867 -
						15,323,867
						2,094,541

		Overseas R&D division - 320,878 320,878 15,770	Manufacturing divisions 47,133,742 16,750,761 63,884,503 19,641,668	Investment divisions - - - 114,812	Adjustments and eliminated - (17,110,624) (17,110,624) (321,368)	Total
						64,205,209 -
						64,205,209
						19,642,845

(Continued)

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements

	For the nine months ended September 30, 2020	For the nine months ended September 30, 2020	For the nine months ended September 30, 2020	For the nine months ended September 30, 2020
Overseas sales division $ 12,569,616 33,825 $ 12,603,441 $ 22,248 Overseas sales division $ 5,551,069 $ 3,119,912 $ 3,802,276 Overseas sales division $ 4,982,043 $ 2,713,185 $ 3,383,158	Overseas R&D division - 341,659 341,659 17,423 Overseas R&D division 187,627 195,825 176,415 Overseas R&D division 3,853 23,832 1,057	Manufacturing divisions 33,662,478 12,324,821 45,987,299 7,853,462 Manufacturing divisions 186,253,509 165,624,472 167,229,704 Manufacturing divisions 19,740,796 11,812,445 13,831,135	Investment divisions - - - 481,002 Investment divisions 44,618,105 34,357,531 35,032,525 Others divisions - 38 -	Adjustments and eliminated - (12,700,305) (12,700,305) (519,764) Adjustments and eliminated (50,306,110) (37,665,760) (39,034,455) Adjustments and eliminated (4,935,205) (2,729,547) (3,407,454)	Total
					46,232,094 -
					46,232,094
					7,854,371
					Total
					186,304,200
					165,631,980
					167,206,465
					Total
					19,791,487
					11,819,953
					13,807,896

AI assistant

NTC — Interim / Quarterly Report 2021

52061_rns_2021-12-16_ed498eb8-b5f8-4ba2-8b2e-2717a106adc7.pdf

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES

Consolidated Financial Statements

Table of contents

KPMG

Independent Auditors’ Review Report

Introduction

Scope of Review

Conclusion

KPMG

Notes to Readers

Nanya Technology Corporation and Subsidiaries

Consolidated Balance Sheets

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards

Nanya Technology Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

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

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards

Nanya Technology Corporation and Subsidiaries

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2021 and 2020

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards Nanya Technology Corporation and Subsidiaries

Notes to the Consolidated Financial Statements

September 30, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(1) Company history

(2) Approval date and procedures of the consolidated financial statements:

(3) New standards, amendments and interpretations adopted:

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(4) Summary of significant accounting policies:

(a) Statement of compliance

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(d) Employee benefits

(e) Income taxes

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty:

(6) Explanation of significant accounts:

(a) Cash and cash equivalents

(b) Notes and accounts receivable

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(c) Other receivables

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(f) Investments accounted for using equity method

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(i) Lease receivables

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(j) Lease liabilities

(ii) Other leases

(k) Employee benefits

(i) Defined benefit plan

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Defined contribution plans

(l) Income tax

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(m) Capital and other equity

(i) Ordinary Share

(ii) Capital surplus

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iii) Retain earning

1) Legal reserve

2) Special Reserve

3) Earnings distribution

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iv) Treasury shares

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(n) Share-based payment

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(o) Earnings per share

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(p) Revenue from contracts with customers

(i) Disaggregation of revenue

NANYA TECHNOLOGY CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

NTC Interim / Quarterly Report 2021