NTC — Interim / Quarterly Report 2021

Nov 19, 2021

Nuvoton Technology Corporation and Subsidiaries

Consolidated Financial Statements for the Nine Months Ended September 30, 2021 and 2020 and Independent Auditors' Review Report

CONSOLIDATED BALANCE SHEETS (In Thousands of New Taiwan Dollars)

		September 30, 2021 (Reviewed)		December 31, 2020	September 30, 2020 (Reviewed)
ASSETS	Amount	%	(Audited) Amount	%	Amount	%
CURRENT ASSETS
Cash and cash equivalents (Notes 6 and 31)	\$ 6,369,871	20	\$ 5,881,733	18	\$ 3,814,188	13
Financial assets at fair value through profit or loss - current (Note 7)	1,806	-	13,223	-	11,326	-
Notes and accounts receivable, net (Notes 8 and 29)	4,075,966	13	4,155,816	13	4,030,564	13
Accounts receivable from related parties, net (Notes 8 and 30)	698,566	2	90,577	-	76,158	-
Other receivables (Notes 9 and 30)	894,962	3	1,710,051	5	2,265,862	7
Inventories (Note 10)	6,776,467	21	6,250,131	20	6,257,559	21
Other current assets	293,850	1	259,015	1	332,890	1
Total current assets	19,111,488	60	18,360,546	57	16,788,547	55
NON-CURRENT ASSETS
Financial assets at fair value through other comprehensive income - non-current
(Note 11)	2,487,111	8	1,806,580	6	1,994,820	7
Property, plant and equipment (Notes 12 and 31)	5,493,511	17	6,547,107	20	6,559,956	22
Right-of-use assets (Notes 13 and 30)	1,250,304	4	1,498,888	5	1,539,095	5
Investment properties (Notes 14 and 31)	2,112,852	7	2,466,667	8	2,501,693	8
Intangible assets (Note 15)	904,211	3	802,691	2	700,693	2
Deferred tax assets (Note 4)	163,101	1	188,397	-	199,432	1
Refundable deposits (Notes 6 and 30)	122,121	-	651,497	2	101,833	-
Other non-current assets	4,457	-	328	-	573	-
Total non-current assets	12,537,668	40	13,962,155	43	13,598,095	45
TOTAL	\$ 31,649,156	100	\$ 32,322,701	100	\$ 30,386,642	100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Notes 17 and 31)	\$ 74,700	-	\$ 1,821,210	6	\$ 1,291,112	4
Financial liabilities at fair value through profit or loss - current (Note 7)	2,634	-	3,191	-	-	-
Notes payable	219,546	-	365,870	1	336,536	1
Accounts payable	2,756,449	9	2,653,008	8	2,572,643	9
Accounts payable to related parties (Note 30)	571,955	2	827,543	3	880,925	3
Other payables (Notes 18 and 30)	4,419,934	14	4,008,274	12	4,367,282	14
Current tax liabilities (Note 4)	403,433	1	221,412	1	298,003	1
Provisions - current (Note 19)	551,784	2	928,719	3	927,168	3
Lease liabilities - current (Notes 13 and 30) Other current liabilities	255,053 559,728	1 2	300,067 421,034	1 1	302,352 178,156	1 1
Total current liabilities	9,815,216	31	11,550,328	36	11,154,177	37
NON-CURRENT LIABILITIES
Bonds payable (Note 16)	98,901	-	1,207,820	4	1,684,222	6
Long-term borrowings (Notes 17 and 31)	1,500,000	5	1,500,000	5	3,300,000	11
Provisions - non-current (Note 19)	2,822,216	9	3,120,468	10	3,112,820	10
Deferred tax liabilities	4,361	-	52,132	-	79,275	-
Lease liabilities - non-current (Notes 13 and 30)	1,186,860	4	1,474,041	4	1,535,304	5
Net defined benefit liabilities - non-current (Note 4)	1,638,937	5	1,780,008	5	1,754,726	6
Other non-current liabilities	310,304	1	116,536	-	107,169	-
Total non-current liabilities	7,561,579	24	9,251,005	28	11,573,516	38
Total liabilities	17,376,795	55	20,801,333	64	22,727,693	75

EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY (Note 21)
Share capital	4,100,427	13	3,759,616	12	2,875,544	10
Certificates of bond-to-stock conversion	71,674	-	124,320	-	84,072	-
Capital surplus	6,609,957	21	5,796,731	18	3,149,626	10
Retained earnings
Legal reserve	655,515	2	596,905	2	596,905	2
Unappropriated earnings	2,722,887	9	1,103,083	3	980,209	3
Exchange differences on translation of financial statements of foreign operations	(826,049)	(3)	(128,352)	-	(135,709)	-
Unrealized gains (losses) on financial assets at fair value through other
comprehensive income	937,950	3	269,065	1	108,302	-
Total equity	14,272,361	45	11,521,368	36	7,658,949	25
TOTAL	\$ 31,649,156	100	\$ 32,322,701	100	\$ 30,386,642	100

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

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

	For the Three Months Ended September 30				For the Nine Months Ended September 30
	2021		2020		2021		2020
	Amount	%	Amount	%	Amount	%	Amount	%
OPERATING REVENUE (Notes 22 and 30)	\$ 10,380,154	100	\$ 5,604,569	100	\$ 31,067,323	100	\$ 10,798,866	100
OPERATING COST (Notes 10, 24 and 30)	6,114,211	59	3,538,267	63	18,539,344	60	6,626,196	61
GROSS PROFIT	4,265,943	41	2,066,302	37	12,527,979	40	4,172,670	39
OPERATING EXPENSES (Notes 24 and 30) Selling expenses General and administrative	303,610	3	171,512	3	928,343	3	279,976	3
expenses Research and development	695,405	7	641,043	12	2,198,501	7	902,153	8
expenses Expected credit loss (gain)	2,446,721 3,366	23 -	1,312,348 4,306	23 -	7,266,349 21,563	23 -	2,699,340 6,765	25 -
Total operating expenses	3,449,102	33	2,129,209	38	10,414,756	33	3,888,234	36
PROFIT (LOSS) FROM OPERATIONS	816,841	8	(62,907)	(1)	2,113,223	7	284,436	3
NON-OPERATING INCOME AND EXPENSES (Note 30)
Finance costs Interest income	(9,856) 5,595	- -	(22,242) 4,238	- -	(60,925) 24,439	- -	(33,567) 18,552	- -
Dividend income Gain on the bargain purchase	5,845 -	- -	52 218,968	- 4	67,845 -	- -	67,746 218,968	1 2
Other gains and losses Gains (losses) on disposal of property, plant and	15,927	-	35,082	1	79,657	-	43,574	-
equipment Gains (losses) on disposal of	376	-	10,028	-	125,564	1	10,057	-
intangible assets Foreign exchange gains (losses)	(4,803) 5,683	- -	- 18,146	- -	(4,803) (28,010)	- -	- 14,833	- -
Gains (losses) on financial assets at fair value through
profit or loss	(1,957)	-	7,432	-	13,217	-	3,921	-
Total non-operating income and expenses	16,810	-	271,704	5	216,984	1	344,084	3
PROFIT BEFORE INCOME TAX	833,651	8	208,797	4	2,330,207	8	628,520	6
INCOME TAX EXPENSE (Notes 4 and 23)	(191,388)	(2)	(89,460)	(2)	(478,155)	(2)	(165,292)	(2)
NET PROFIT FOR THE PERIOD	642,263	6	119,337	2	1,852,052	6	463,228	4 (Continued)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

	For the Three Months Ended September 30				For the Nine Months Ended September 30
	2021	2020		2021
	Amount	%	Amount	%	Amount	%	Amount	%
OTHER COMPREHENSIVE INCOME (LOSS) (Note 21) Items that will not be reclassified subsequently to profit or loss: Unrealized gains (losses) on investments in equity instruments at fair value through other
comprehensive income Items that may be reclassified subsequently to profit or loss: Exchange differences on translation of the financial statements of foreign operations	\$ 40,906 (76,174)	1 (1)	\$ (15,824) (98,660)	- (2)	\$ 806,980 (697,697)	2 (2)	\$ (61,242) (116,725)	- (1)
Other comprehensive income (loss) for the period, net of income tax	(35,268)	-	(114,484)	(2)	109,283	-	(177,967)	(1)
TOTAL COMPREHENSIVE INCOME (LOSS) FOR THE PEROID	\$ 606,995	6	\$ 4,853	-	\$ 1,961,335	6	\$ 285,261	3
EARNINGS PER SHARE (Note 26) From continuing operations Basic Diluted	\$ 1.56 \$ 1.53		\$ 0.41 \$ 0.37		\$ 4.63 \$ 4.41		\$ 1.61 \$ 1.52

The accompanying notes are an integral part of the consolidated financial statements. (Concluded)

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

Equity Attributable to Owners of the Company

	Other Equity
Exchange Differences on Translation of Financial Foreign Operations	Unrealized Gains (Losses) on Financial Assets at Fair Value Comprehensive Income	Total Equity

		Certificates of		Retained Earnings		Financial at Fair Value Statements of Through Other
	Ordinary Share	Bond-to-stock Conversion	Capital Surplus	Legal Reserve	Unappropriated Earnings	Foreign Operations	Comprehensive Income	Total Equity
BALANCE AT JANUARY 1, 2020	\$ 2,875,544	\$ -	\$ 2,906,976	\$ 541,722	\$ 917,229	\$ (18,984)	\$ 169,544	\$ 7,392,031
Net profit for the nine months ended September 30, 2020	-	-	-	-	463,228	-	-	463,228
Other comprehensive income (loss) for the nine months ended September 30, 2020, net of income tax	-	-	-	-	-	(116,725)	(61,242)	(177,967)
Total comprehensive income (loss) for the nine months ended September 30, 2020	-	-	-	-	463,228	(116,725)	(61,242)	285,261
Convertible bonds converted to ordinary shares (Note 16)	-	84,072	242,650	-	-	-	-	326,722
Appropriation of 2019 earnings (Note 21) Legal reserve Cash dividends	- -	- -	- -	55,183 -	(55,183) (345,065)	- -	- -	- (345,065)
BALANCE AT SEPTEMBER 30, 2020	\$ 2,875,544	\$ 84,072	\$ 3,149,626	\$ 596,905	\$ 980,209	\$ (135,709)	\$ 108,302	\$ 7,658,949
BALANCE AT JANUARY 1, 2021	\$ 3,759,616	\$ 124,320	\$ 5,796,731	\$ 596,905	\$ 1,103,083	\$ (128,352)	\$ 269,065	\$ 11,521,368
Net profit for the nine months ended September 30, 2021	-	-	-	-	1,852,052	-	-	1,852,052
Other comprehensive income (loss) for the nine months ended September 30, 2021, net of income tax	-	-	-	-	-	(697,697)	806,980	109,283
Total comprehensive income (loss) for the nine months ended September 30, 2021	-	-	-	-	1,852,052	(697,697)	806,980	1,961,335
Convertible bonds converted to ordinary shares (Note 16)	340,811	(52,646)	813,216	-	-	-	-	1,101,381
Dividends from claims extinguished by prescriptions	-	-	10	-	-	-	-	10
Disposal of investments in equity instruments designated at fair value through other comprehensive income (Notes 11 and 21)	-	-	-	-	138,095	-	(138,095)	-
Appropriation of 2020 earnings (Note 21) Legal reserve Cash dividends	- -	- -	- -	58,610 -	(58,610) (311,733)	- -	- -	- (311,733)
BALANCE AT SEPTEMBER 30, 2021	\$ 4,100,427	\$ 71,674	\$ 6,609,957	\$ 655,515	\$ 2,722,887	\$ (826,049)	\$ 937,950	\$ 14,272,361

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

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

	For the Nine Months Ended September	30
	2021	2020
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before income tax	\$ 2,330,207	\$ 628,520
Adjustments for:
Depreciation expense	823,785	313,297
Amortization expense	174,731	121,154
Finance costs	60,925	33,567
Expected credit loss (gain) recognized on accounts receivable	21,563	6,765
Interest income	(24,439)	(18,552)
Dividend income	(67,845)	(67,746)
Losses (gains) on disposal of intangible assets	4,803	-
(Gains) losses on disposal of property, plant and equipment	(125,564)	(10,057)
Gain on the bargain purchase	-	(218,968)
Other income	-	(5)
Changes in operating assets and liabilities
(Increase) decrease in financial assets at fair value through profit
or loss	(3,801)	(1,556)
(Increase) decrease in notes and accounts receivable	58,641	219,840
(Increase) decrease in accounts receivable from related parties	(607,989)	17,441
(Increase) decrease in other receivables	304,623	(71,782)
(Increase) decrease in inventories	(526,336)	(39,799)
(Increase) decrease in other current assets	(44,531)	24,919
(Increase) decrease in other non-current assets	(4,129)	707
Increase (decrease) in notes payable	(146,324)	(79,186)
Increase (decrease) in accounts payable	103,441	64,479
Increase (decrease) in accounts payable to related parties	(255,588)	(673,873)
Increase (decrease) in other payables	276,556	397,625
Increase (decrease) in provisions	(316,438)	3,632
Increase (decrease) in other current liabilities	138,694	52,109
Increase (decrease) in net defined benefit liabilities	4,037	(6,297)
Increase (decrease) in other non-current liabilities	8,145	12,580
Cash flows generated from (used in) operations	2,187,167	708,814
Income tax paid	(269,730)	(29,110)
Interest received	20,478	24,761
Interest paid	(56,911)	(16,443)
Dividend received	67,845	67,746
Net cash flows generated from (used in) operating activities	1,948,849	755,768
		(Continued)

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

	For the Nine Months Ended September	30
	2021	2020
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of intangible assets	\$ (194,574)	\$ (336,731)
Proceeds from disposal of financial assets at fair value through other comprehensive income	235,166	-
Proceeds from capital reduction of financial assets at fair value through
other comprehensive income	4,500	2,250
Acquisition of subsidiaries (Note 27)	(77,934)	(6,928,207)
Acquisition of property, plant and equipment	(366,196)	(286,092)
Proceeds from disposal of property, plant and equipment	888,990	14,380
(Increase) decrease in refundable deposits	529,376	(10,977)
Decrease (increase) in other receivables - time deposits	3,188	146,046
Net cash flows generated from (used in) investing activities	1,022,516	(7,399,331)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from short-term borrowings	452,550	1,291,112
Repayment of short-term borrowings	(2,169,009)	-
Proceeds from long-term borrowings	-	2,800,000
Proceeds from issuance of bond payables	-	1,998,428
Proceeds from guarantee deposits received	185,623	14,445
Repayment of the principal portion of lease liabilities	(216,226)	(104,484)
Dividends paid	(311,733)	(345,065)
Net cash flows generated from (used in) financing activities	(2,058,795)	5,654,436
EFFECT OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH HELD IN FOREIGN CURRENCIES	(424,432)	(55,908)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	488,138	(1,045,035)
CASH AND CASH EQUIVALENTS, BEGINNING OF THE PERIOD	5,881,733	4,859,223
CASH AND CASH EQUIVALENTS, END OF THE PERIOD	\$ 6,369,871	\$ 3,814,188

The accompanying notes are an integral part of the consolidated financial statements. (Concluded)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise) (Reviewed, Not Audited)

1. GENERAL INFORMATION

Nuvoton Technology Corporation (the "Company") was incorporated in the Republic of China ("ROC") in April 2008 and commenced business in July 2008. The Company is engaged mainly in the research, design, development, manufacture, and sale of logic integrated circuits ("ICs") and the manufacturing, testing and OEM of 6-inch wafers.

For the specialization and division of labor and the reinforcement of core competitive ability, the Company's parent company, Winbond Electronics Corporation (WEC), spun off its Logic IC business into the Company on July 1, 2008 in accordance with the Business Mergers and Acquisitions Act. WEC held approximately 52%, 55% and 60% of the ownership interest in the Company as of September 30, 2021, December 31, 2020 and September 30, 2020, respectively.

The Company's shares have been listed on the Taiwan Stock Exchange since September 27, 2010.

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved by the Company's Board of Directors and authorized for issue on November 3, 2021.

3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS

a. Initial application of the amendments to the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), International Financing Reporting Interpretation Committee (IFRIC), and SIC Interpretations (SIC) (collectively, the "IFRSs") endorsed and issued into effect by the Financial Supervisory Commission (FSC)

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

b. The IFRSs endorsed by the Financial Supervisory Commission (FSC) for application starting from 2022

New IFRSs	Effective Date Announced by IASB
"Annual Improvements to IFRS Standards 2018-2020"	January 1, 2022 (Note 1)
Amendments to IFRS 3 "Reference to the Conceptual Framework"	January 1, 2022 (Note 2)
Amendments to IAS 16 "Property, Plant and Equipment - Proceeds	January 1, 2022 (Note 3)
before Intended Use"
Amendments to IAS 37 "Onerous Contracts - Cost of Fulfilling a	January 1, 2022 (Note 4)
Contract"

• Note 1: The amendments to IFRS 9 will be applied prospectively to modifications and exchanges of financial liabilities that occur on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IAS 41 "Agriculture" will be applied prospectively to the fair value measurements on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IFRS 1 "First-time Adoptions of IFRSs" will be applied retrospectively for annual reporting periods beginning on or after January 1, 2022.
• Note 2: The amendments are applicable to business combinations for which the acquisition date is on or after the beginning of the annual reporting period beginning on or after January 1, 2022.
• Note 3: The amendments are applicable to property, plant and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after January 1, 2021.
• Note 4: The amendments are applicable to contracts for which the entity has not yet fulfilled all its obligations on January 1, 2022.

As of the date that the consolidated financial statements were authorized for issue, the Group is continuously assessing the possible impact that the application of other standards and interpretations will have on the Group's financial position and financial performance and will disclose the relevant impact when the assessment is completed.

c. New IFRSs in issue but not yet endorsed and issued into effect by the FSC

New IFRSs	Effective Date Announced by IASB (Note 1)
Amendments to IFRS 10 and IAS 28 "Sale or Contribution of Assets	To be determined by IASB
between An Investor and Its Associate or Joint Venture"
IFRS 17 "Insurance Contracts"	January 1, 2023
Amendments to IFRS 17"Insurance Contracts"	January 1, 2023
Amendments to IAS 1 "Classification of Liabilities as Current or	January 1, 2023
Non-current"
Amendments to IAS 1 "Disclosure of Accounting Policies"	January 1, 2023 (Note 2)
Amendments to IAS 8 "Definition of Accounting Estimates"	January 1, 2023 (Note 3)
Amendments to IAS 12 "Deferred Tax related to Assets and	January 1, 2023 (Note 4)
Liabilities arising from a Single Transaction"

• Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.
• Note 2: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.
• Note 3: The amendments are applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.
• Note 4: Except that deferred taxes will be recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments will be applied prospectively to transactions that occur on or after January 1, 2022.

As of the date the consolidated financial statements were authorized for issue, the Group is continuously assessing the possible impact that the application of other standards and interpretations will have on the Group's financial position and financial performance and will disclose the relevant impact when the assessment is completed.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Statement of Compliance

The interim consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IAS 34 "Interim Financial Reporting" as endorsed and issued into effect by the FSC. The consolidated financial statements do not present all disclosures required for a complete set of annual consolidated financial statements under the IFRSs as endorsed and issued into effect by the FSC.

Basis of Preparation

The consolidated financial statements have been prepared on the historical cost basis except for financial instruments and net defined benefit liabilities which are measured at the present value of the defined benefit obligation less the fair value of plan assets, that are measured at fair values. Historical cost is generally based on the fair value of the consideration given in exchange for assets.

Basis of Consolidation

The consolidated financial statements incorporate the financial statements of the Company and the entities controlled by the Company. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Company. All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation.

Subsidiary included in the consolidated financial statements:

				Percentage of Ownership (%)
			September 30,	December 31,	September 30,
Investor	Investee	Main Business	2021	2020	2020
The Company	Nuvoton Electronics Technology (H.K.) Limited ("NTHK")	Sales of semiconductor	100	100	100
	Marketplace Management Limited ("MML")	Investment holding	100	100	100
	Nuvoton Investment Holding Ltd. ("NIH")	Investment holding	100	100	100
	Song Yong Investment Corporation ("SYI")	Investment holding	100	100	100
	Nuvoton Technology India Private Limited ("NTIPL")	Design, sales and after-sales service of semiconductor	100	100	100
	Nuvoton Technology Corporation America ("NTCA")	Design, sales and after-sales service of semiconductor	100	100	100
	Nuvoton Technology Holdings Japan ("NTHJ") (Note)	Investment holding	100	100	100
	Nuvoton Technology Singapore Pte. Ltd ("NTSPL")	Design, sales and after-sales service of semiconductor	100	100	100
	Nuvoton Technology Korea Limited ("NTKR")	Design, sales and after-sales service of semiconductor	100	100	100
NTHK	Nuvoton Electronics Technology (Shenzhen) Limited ("NTSZ")	Computer software service (except I.C. design), wholesale business for computer, supplement and software	100	100	100
MML	Goldbond LLC ("GLLC")	Investment holding	100	100	100
GLLC	Nuvoton Electronics Technology (Shanghai) Limited ("NTSH")	Provides projects for sale in China and repairing, testing and consulting of software and leasing business	100	100	100
	Winbond Electronics (Nanjing) Ltd. ("WENJ")	Computer software service (except I.C. design)	100	100	100
NTSH	Song Zhi Electronics Technology (Suzhou) ("Song Zhi Suzhou")	Provide development of semiconductor and technology, consult service and equipment lease	100	-	-
NIH	Nuvoton Technology Israel Ltd. ("NTIL")	Design and service of semiconductor	100	100	100
NTHJ	Nuvoton Technology Corporation Japan ("NTCJ", formerly PSCS company) (Note)	Design, sales and after-sales service of semiconductor	100	100	100
NTCJ	Atfields Manufacturing Technology Corporation ("AMTC", formerly PIDE company) (Note)	Design and service of semiconductor	100	100	100
	Miraxia Edge Technology Corporation ("METC", formerly PIDST company) (Note)	Design and service of semiconductor	100	100	100

Note: The Group acquired the semiconductor business of Panasonic Corporation on September 1, 2020 and held NTHJ, NTCJ (formerly "PSCS"), AMTC (formerly "PIDE"), and METC (formerly "PIDST") with 100% ownership, refer to Note 27 to the consolidated financial statements.

Retirement Benefits

Payments to defined contribution retirement benefit plans are recognized as expense when employees have rendered service entitling them to the contributions.

Defined benefit costs (including service cost, net interest and remeasurement) under defined benefit retirement benefit plans are determined using the projected unit credit method. Service cost and net interest on the net defined benefit liabilities are recognized as employee benefits expense in the period in which they occur. Remeasurement, comprising actuarial gains and losses and the return on plan assets excluding interest, is recognized in other comprehensive income in the period in which it occurs. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss.

Net defined benefit liabilities represent the actual deficit in the Group's defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.

Pension cost for an interim period is calculated on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant plan amendments, settlements, or other significant one-off events.

Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax. Interim period income taxes are assessed on an annual basis and calculated by applying to an interim period's pre-tax income the tax rate that would be applicable to expected total annual earnings.

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

The Group considers the recent development of the COVID-19 in Taiwan and its economic environment implications when making its critical accounting estimates in cash flow projections, growth rate, discount rate, profitability, etc. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised if the revisions affect only that period or in the period of the revisions and future periods if the revisions affect both current and future periods.

6. CASH AND CASH EQUIVALENTS

	September 30,	December 31,	September 30,
	2021	2020	2020
Cash and deposits in banks Repurchase agreements collateralized by bonds	\$ 5,946,871 423,000	\$ 4,898,733 983,000	\$ 3,797,988 16,200
	\$	\$	\$
	6,369,871	5,881,733	3,814,188

• a. Please refer to Note 31 to the consolidated financial statements for the amount of refundable deposits pledged to secure land leases, customs tariff obligations and borrowings.
• b. The Group has time deposits which are not held for the purpose of meeting short-term cash commitments and are reclassified to "other receivables" as follows (Note 9):

	September 30,	December 31,	September 30,
	2021	2020	2020
Time deposits	\$	\$	\$
	194,301	197,489	301,679

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

	September 30, 2021	December 31, 2020	September 30, 2020
Financial assets at FVTPL - current
Forward exchange and cross-currency swap contracts Right of redemption of convertible bonds	\$ - 1,806 \$ 1,806	\$ 4,128 9,095 \$ 13,223	\$ 3,794 7,532 \$ 11,326
Financial liabilities at FVTPL - current
Forward exchange contracts	\$ 2,634	\$ 3,191	\$ -

At the end of the reporting period, the outstanding foreign exchange forward and cross-currency swap contracts not treated under hedge accounting were as follows:

	Currency	Maturity Date	Contract Amount (In Thousands)
September 30, 2021
Sell forward exchange contracts	USD/NTD	2021.10.01-2021.11.25	USD32,000/NTD888,572
December 31, 2020
Sell forward exchange contracts Cross-currency swap contracts	USD/NTD USD/NTD	2021.01.21-2021.02.25 2021.01.22	USD21,000/NTD594,889 USD16,000/NTD459,808
September 30, 2020
Sell forward exchange contracts Cross-currency swap contracts	USD/NTD USD/NTD	2020.10.08-2020.11.27 2020.11.27	USD24,000/NTD703,794 USD16,000/NTD464,000

The Group entered into foreign exchange forward and cross-currency swap contracts to manage exposures to exchange rate fluctuations of foreign currency denominated assets and liabilities. These foreign exchange forward and cross-currency swap contracts did not meet the criteria for hedge accounting, therefore, the Group did not apply hedge accounting treatment.

8. NOTES AND ACCOUNTS RECEIVABLE, NET

	September 30,	December 31,	September 30,
	2021	2020	2020
Notes receivable	\$	\$	\$
	-	-	-
Accounts receivable (including related parties)
At amortized cost Gross carrying amount Less: Allowance for impairment loss	4,820,838 (46,306)	4,271,490 (25,097)	4,136,652 (29,930)
	\$	\$	\$
	4,774,532	4,246,393	4,106,722

The average credit period of sales of goods was 30-60 days. No interest was charged on accounts receivable. The Group adopted a policy of only dealing with entities that are rated the equivalent of investment grade or higher and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group uses other publicly available financial information and its own trading records to rate its major customers. The Group's exposure and the credit ratings of its counterparties are continuously monitored. Credit exposure is controlled by counterparty limits that are reviewed and approved by the Group annually.

In order to minimize credit risk, the management of the Group has delegated a team responsible for determining credit limits, credit approvals and other monitoring procedures to ensure that follow-up actions are taken to recover overdue debts. In addition, the Group reviews the recoverable amount of each individual trade debt at the end of the reporting period to ensure that adequate allowance is made for possible irrecoverable amounts. In this regard, the management believes the Group's credit risk was significantly reduced.

The Group applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits the use of lifetime expected loss provision for all accounts receivable. The expected credit losses on accounts receivable are estimated using a provision matrix by reference to past default experience of the customer and the customer's current financial position, adjusted for economic conditions of the industry in which the customer operates, as well as the GDP forecast and industry outlooks. As the Group's historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished between the Group's different customer base.

The Group writes off accounts receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery. For accounts receivable that have been written off, the Group continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are recognized in profit or loss.

The following table details the loss allowance of accounts receivable (including related parties) based on the Group's provision matrix.

September 30, 2021

	Not Overdue	Overdue under 30 Days	Overdue 31 to 90 Days	Overdue 91 to 180 Days	Over 180 Days	Total
Expected credit loss rate	0.1%-2%	2%	10%	20%	50%
Gross carrying amount Loss allowance (Lifetime ECL)	\$ 4,789,649 (37,880)	\$ 14,936 (299)	\$ - -	\$ - -	\$ 16,253 (8,127)	\$ 4,820,838 (46,306)
Amortized cost	\$ 4,751,769	\$ 14,637	\$ -	\$ -	\$ 8,126	\$ 4,774,532

December 31, 2020

	Not Overdue	Overdue under 30 Days	Overdue 31 to 90 Days	Overdue 91 to 180 Days	Over 180 Days	Total
Expected credit loss rate	0.1%-2%	2%	10%	20%	50%
Gross carrying amount Loss allowance (Lifetime ECL)	\$ 4,250,939 (21,694)	\$ 3,931 (79)	\$ - -	\$ 16,620 (3,324)	\$ - -	\$ 4,271,490 (25,097)
Amortized cost	\$ 4,229,245	\$ 3,852	\$ -	\$ 13,296	\$ -	\$ 4,246,393

September 30, 2020

	Not Overdue	Overdue under 30 Days		Overdue 31 to 90 Days	Overdue 91 to 180 Days	Over 180 Days	Total
Expected credit loss rate	0.1%-2%	2%		10%	20%	50%
Gross carrying amount Loss allowance (Lifetime ECL)	\$ 4,116,054 (28,590)	\$	9,001 (180)	\$ 11,597 (1,160)	\$ - -	\$ - -	\$ 4,136,652 (29,930)
Amortized cost	\$ 4,087,464	\$	8,821	\$ 10,437	\$ -	\$ -	\$ 4,106,722

The movements of the loss allowance of notes and accounts receivable were as follows:

	For the Nine Months Ended September 30
	2021	2020
Balance at January 1	\$ 25,097	\$ 22,566
Add: Acquired through business combinations	-	806
Add: Net remeasurement of loss allowance	21,563	6,765
Foreign currency exchange gains and losses	(354)	(207)
Balance at September 30	\$ 46,306	\$ 29,930

The Group's provision for losses on accounts receivable was recognized on a collective basis.

Refer to Note 29 to the consolidated financial statements for details of the factoring agreements for accounts receivable.

9. OTHER RECEIVABLES

	September 30, 2021		December 31, 2020		September 30, 2020
Time deposits (Note 6)	\$	194,301	\$	197,489	\$	301,679
Technical service receivable		137,975		175,667		181,891
Royalty receivable		116,893		425,453		334,783
Business tax refund receivable		58,396		165,647		315,593
Prepayment for pension		-		-		286,411
Receivables for acquisition price adjustment		-		520,890		520,890
Others		387,397		224,905		324,615
	\$	894,962	\$	1,710,051	\$	2,265,862

10. INVENTORIES

	September 30,	December 31,	September 30,
	2021	2020	2020
Raw materials and supplies	\$	\$	\$
	308,336	301,764	270,885
Work in process	4,455,770	4,008,947	3,872,794
Finished goods	2,001,900	1,934,294	2,113,880
Inventory in transit	10,461	5,126	-
	\$	\$	\$
	6,776,467	6,250,131	6,257,559

The operating cost for the three months ended September 30, 2021 and 2020, and the nine months ended September 30, 2021 and 2020 were NT\$6,114,211 thousand, NT\$3,538,267 thousand, NT\$18,539,344 thousand and NT\$6,626,196 thousand, respectively. The inventory write-downs, obsolescence and abandonment of inventories for the three months ended September 30, 2021 and 2020, and the nine months ended September 30, 2021 and 2020 were NT\$(38,896) thousand, NT\$(21,839) thousand, NT\$14,490 thousand and NT\$(108,691) thousand, respectively.

11. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Investments in equity instruments at FVTOCI:

	September 30, 2021		December 31, 2020		September 30, 2020
Listed shares and emerging market shares
Nyquest Technology Co., Ltd.	\$	245,025	\$	80,685	\$	56,843
Brightek Optoelectronic Co., Ltd.		1,767		894		801
Tower Semiconductor Ltd.		-		232,110		469,902
Unlisted shares
United Industrial Gases Co., Ltd.		422,400		396,000		422,400
Yu-Ji Venture Capital Co., Ltd.		10,193		14,479		11,992
Autotalks Ltd. - Preferred E. Share		557,000		569,600		582,000
Tower Partners Semiconductor Co., Ltd.
("TPSCo.")		1,250,726		512,812		450,882
Symetrix Corporation - Preferred A. Share		-		-		-
	\$	2,487,111	\$	1,806,580	\$	1,994,820

These investments in equity instruments are not held for trading. Instead, they are held for medium to long-term strategic purposes. Accordingly, the management decided to designate these investments in equity instruments as at FVTOCI as they believe that recognizing short-term fluctuations in these investments' fair value in profit or loss would not be consistent with the Group's strategy of holding these investments for long-term purposes.

In January, 2021, the Group sold remaining of its shares in Tower Semiconductor Ltd. in order to manage credit concentration risk. The shares sold had a fair value of NT\$235,166 thousand. Their related unrealized valuation gain of NT\$138,095 thousand was transferred from other equity to retained earnings. Refer to Note 21 to the consolidated financial statements for related information.

The Group recognized dividend income NT\$5,845 thousand, NT\$52 thousand, NT\$67,845 thousand and NT\$67,746 thousand for the three months ended and nine months ended September 30, 2021 and 2020, respectively.

In September, 2020, the Company acquired the Preferred A Share of the Symetrix Corporation through the combination of Panasonic semiconductor business. The entitled rights of the Preferred A Share were as follows:

• a. Each Preferred A Shares grants its holder a number of votes equal to the number of votes per Ordinary Share.
• b. In the event of liquidation, the Preferred A Shares shall be prior to Ordinary Shares.
• c. The investor shall have the right to nominate board directors.
• d. The conversion rights (Each Preferred A share converts ten Ordinary Shares).

12. PROPERTY, PLANT AND EQUIPMENT

	September 30, 2021	December 31, 2020	September 30, 2020
Land	\$ 1,985,907	\$ 2,203,639	\$ 2,198,056
Buildings	2,034,447	2,374,032	2,450,355
Machinery and equipment	1,119,578	1,574,487	1,485,772
Other equipment	234,786	256,600	298,994
Construction in progress and prepayments for purchase of equipment	118,793	138,349	126,779
	\$ 5,493,511	\$ 6,547,107	\$ 6,559,956

Cost	Land	Buildings	Machinery and Equipment	Other Equipment	Construction in Progress and Prepayments for Purchase of Equipment	Total
Balance at January 1,
2021	\$ 2,203,639	\$ 23,437,689	\$ 63,250,171	\$ 3,831,256	\$ 172,820	\$ 92,895,575
Additions	-	19,106	137,375	141,360	59,775	357,616
Business combinations - subsequent adjustment
of fair value	-	-	437,628	-	-	437,628
Disposals	-	(8,297)	(1,077,574)	(87,660)	-	(1,173,531)
Reclassified Effects of foreign currency exchange	-	824	85,824	11,078	(97,726)	-
differences	(217,732)	(1,950,455)	(5,057,297)	(354,444)	(16,076)	(7,596,004)
Balance at September 30, 2021	1,985,907	21,498,867	57,776,127	3,541,590	118,793	84,921,284
Accumulated depreciation and impairment
Balance at January 1,
2021	-	21,063,657	61,675,684	3,574,656	34,471	86,348,468
Disposals	-	(8,272)	(330,885)	(70,948)	-	(410,105)
Depreciation expense	-	149,572	266,618	127,639	-	543,829
Reclassified Effects of foreign	-	79	31,168	428	(31,675)	-
currency exchange
differences	-	(1,740,616)	(4,986,036)	(324,971)	(2,796)	(7,054,419)
Balance at September 30, 2021	-	19,464,420	56,656,549	3,306,804	-	79,427,773
Carrying amounts at
September 30, 2021	\$ 1,985,907	\$ 2,034,447	\$ 1,119,578	\$ 234,786	\$ 118,793	\$ 5,493,511 (Continued)

	Land	Buildings	Machinery and Equipment	Other Equipment	Construction in Progress and Prepayments for Purchase of Equipment	Total
Cost
Balance at January 1, 2020 Additions	\$ - -	\$ 3,662,145 37,939	\$ 11,557,247 100,681	\$ 405,918 26,511	\$ 1,416 94,805	\$ 15,626,726 259,936
Acquired through business combinations Disposals	2,223,578 -	19,948,652 (7,669)	52,749,498 (287,687)	3,592,196 (34,579)	110,089 -	78,624,013 (329,935)
Reclassified Effects of foreign currency exchange differences	- (25,522)	3,388 (228,999)	39,775 (606,392)	209 (45,618)	(43,372) (1,682)	- (908,213)
Balance at September 30, 2020	2,198,056	23,415,456	63,553,122	3,944,637	161,256	93,272,527
Accumulated depreciation and impairment
Balance at January 1,
2020	-	3,472,390	11,092,214	301,801	-	14,866,405
Disposals Depreciation expense Acquired through	- -	(7,669) 35,955	(285,847) 121,524	(32,096) 33,468	- -	(325,612) 190,947
business combinations Reclassified Effects of foreign	- -	17,667,303 -	51,732,718 1,294	3,384,282 -	36,176 (1,294)	72,820,479 -
currency exchange differences	-	(202,878)	(594,553)	(41,812)	(405)	(839,648)
Balance at September 30, 2020	-	20,965,101	62,067,350	3,645,643	34,477	86,712,571
Carrying amounts at September 30, 2020	\$ 2,198,056	\$ 2,450,355	\$ 1,485,772	\$ 298,994	\$ 126,779	\$ 6,559,956 (Concluded)

Please refer to Note 31 to the consolidated financial statements for the amount of property, plant and equipment pledged as collateral for bank borrowings.

13. LEASE ARRANGEMENTS

a. Right-of-use assets

	September 30,	December 31,	September 30,
	2021	2020	2020
Carrying amounts
Land Buildings Machinery and equipment Other equipment	\$ 179,752 249,464 797,489 23,599	\$ 198,547 326,004 940,671 33,666	\$ 207,635 336,987 956,753 37,720
	\$	\$	\$
	1,250,304	1,498,888	1,539,095

		For the Three Months Ended September 30		For the Nine Months Ended September 30
	2021	2020	2021	2020
Additions to right-of-use assets Acquired through business	\$ -	\$ 53,972	\$ 12,514	\$ 66,364
combinations	\$ -	\$ 997,787	\$ -	\$ 997,787
Depreciation for right-of-use assets Land Buildings Machinery and equipment Other equipment	\$ 6,265 25,447 16,957 4,804	\$ 6,315 22,515 6,231 5,123	\$ 18,795 76,922 52,165 14,240	\$ 18,946 65,833 6,231 14,239
	\$ 53,473	\$ 40,184	\$ 162,122	\$ 105,249
Income from the subleasing of right-of-use assets (presented in other income)	\$ 1,877	\$ 1,427	\$ 5,582	\$ 5,281
b. Lease liabilities
		September 30, 2021	December 31, 2020	September 30, 2020
Carrying amounts
Current Non-current		\$ 255,053 \$ 1,186,860	\$ 300,067 \$ 1,474,041	\$ 302,352 \$ 1,535,304

Range of discount rate for lease liabilities was as follows:

	September 30, 2021	December 31, 2020	September 30, 2020
Land	1.76%-2.06%	1.76%-2.06%	1.76%-2.06%
Buildings	0.33%-3.75%	0.33%-3.75%	0.33%-3.75%
Machinery and equipment	0.26%-0.80%	0.33%-0.80%	0.24%-0.80%
Other equipment	0.26%-3.61%	0.26%-3.61%	0.33%-3.61%

For the three months ended September 30, 2021 and 2020 and the nine months ended September 30, 2021 and 2020, the interest expense under lease liabilities amounted to NT\$4,047 thousand, NT\$3,535 thousand, NT\$12,981 thousand and NT\$9,067 thousand, respectively.

c. Material lease-in activities and terms

The Group leases low-voltage protection equipment from others in Japan, and the lease term will expire in 2021 to 2035 years.

The Group leased parcels of land from Science Park Administration, and the lease term will expire in December 2027, which can be extended after the expiration of the lease periods.

The Group leased parcels of land from Taiwan Sugar Corporation under a twenty-year term from October 2014 to September 2034, which is allowed to extend after the expiration of lease. The chairman of the Company, is a joint guarantor of such lease (refer to Note 30 to the consolidated financial statements).

The Group leased some of the offices in the United States, China, Israel, India, Korea and Taiwan, and the lease terms will expire between 2021 and 2026 which can be extended after the expiration of the lease periods.

d. Subleases

The Group subleases its right-of-use assets for buildings under operating leases with lease terms between 1 and 5 years.

The maturity analysis of lease payments receivable under operating subleases is as follows:

	September 30, 2021		December 31, 2020		September 30, 2020
Year 1	\$ 6,825	\$	6,816	\$	6,848
Year 2	3,050		5,041		6,398
Year 3	519		1,224		1,632
Year 4	-		-		-
Year 5	-		-		-
Year 6 onwards	-		-		-
	\$ 10,394	\$	13,081	\$	14,878

To reduce the residual asset risk related to the subleased asset at the end of the relevant sublease, the lease contract between the Group and the lessee includes the receipt of the deposits and the compensation for damage due to the lack of management and maintenance.

e. Other lease information

	For the Three Months Ended September 30		September 30	For the Nine Months Ended
	2021	2020	2021	2020
Expenses relating to short-term
leases	\$ 64,938	\$ 37,046	\$ 176,306	\$ 39,841
Total cash outflow for leases	\$ (138,084)	\$ (85,241)	\$ (405,570)	\$ (152,497)

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

Lease-out arrangements under operating leases for investment properties are set out in Note 14 to the consolidated financial statements.

14. INVESTMENT PROPERTIES

	September 30,	December 31,	September 30,
	2021	2020	2020
Investment properties, net	\$	\$	\$
	2,112,852	2,466,667	2,501,693

The Group acquired investment properties through business combinations in Niigata and Toyama, Japan on September 1, 2020. The fair value of investment properties was NT\$2,503,591 thousand on the purchase price allocation report. The Group's management team evaluated the fair value of investment properties and determined that the fair value of the investment properties had not changed significantly, compared to the fair value of the investment properties as of September 30, 2021.

The remaining investment properties are located in Shenzhen, China. As of December 31, 2020 and 2019, the fair value of such investment properties was both approximately NT\$200,000 thousand, which used as reference the neighboring area transactions. The Group's management team evaluated the fair value of investment properties and determined that the fair value of the investment properties had not changed significantly, compared to the fair value of the investment properties as of September 30, 2021 and 2020.

	September 30
	2021	2020
Cost
Balance at January 1	\$ 9,090,968	\$ 98,511
Acquired through business combinations	-	9,072,159
Disposals	(1,176)	-
Effects of foreign currency exchange differences	(889,937)	(104,952)
Balance at September 30	8,199,855	9,065,718
Accumulated depreciation and impairment
Balance at January 1	6,624,301	54,304
Acquired through business combinations	-	6,568,568
Disposals	(1,176)	-
Depreciation expense	117,834	17,101
Effects of foreign currency exchange differences	(653,956)	(75,948)
Balance at September 30	6,087,003	6,564,025
Carrying amount at September 30	\$ 2,112,852	\$ 2,501,693

The investment properties were leased out for 3 to 12 years. The lease contracts contain market review clauses in the event that the lessees exercise their options to extend. The lessees do not have bargain purchase options to acquire the investment properties at the expiry of the lease periods.

The maturity analysis of lease payments receivable under operating leases of investment properties was as follows:

	September 30, 2021			September 30, 2020
Year 1	\$ 203,997	\$	265,390	\$	266,560
Year 2	160,605		203,485		226,271
Year 3	160,605		178,214		179,181
Year 4	160,605		159,218		179,181
Year 5	160,605		102,231		179,181
Year 6 onwards	883,328		741,175		-
	\$ 1,729,745	\$	1,649,713	\$	1,030,374

To reduce the residual asset risk related to the subleased asset at the end of the relevant sublease, the lease contract between the Group and the lessee includes the receipt of the deposits and the compensation for damage due to the lack of management and maintenance.

Please refer to Note 31 to the consolidated financial statements for the amount of investment properties pledged as collateral for bank borrowings.

15. INTANGIBLE ASSETS

	September 30, 2021	December 31, 2020	September 30, 2020
Deferred technical assets Other intangible assets	\$ 604,911 299,300	\$ 537,497 265,194	\$ 561,884 138,809
	\$ 904,211	\$ 802,691	\$ 700,693
	Deferred Technical Assets	Other Intangible Assets	Total
Cost
Balance at January 1, 2021 Additions Disposals Effects of foreign currency exchange differences Balance at September 30, 2021	\$ 1,640,243 210,786 (5,591) (4,399) 1,841,039	\$ 1,360,969 91,535 - (126,948) \$ 1,325,556	\$ 3,001,212 302,321 (5,591) (131,347) 3,166,595
Accumulated amortization and impairment
Balance at January 1, 2021 Amortization expense Disposals Effects of foreign currency exchange differences Balance at September 30, 2021	1,102,746 136,660 (788) (2,490) 1,236,128	1,095,775 38,071 - (107,590) 1,026,256	2,198,521 174,731 (788) (110,080) 2,262,384
Carrying amounts at September 30, 2021	\$ 604,911	\$ 299,300	\$ 904,211
Cost
Balance at January 1, 2020 Additions Acquired through business combinations Disposals Effects of foreign currency exchange differences Balance at September 30, 2020	\$ 1,202,455 415,625 - - (4,243) 1,613,837	\$ 3,426 64,905 1,200,865 (2,972) (14,094) \$ 1,252,130	\$ 1,205,881 480,530 1,200,865 (2,972) (18,337) 2,865,967
Accumulated amortization and impairment
Balance at January 1, 2020 Amortization expense Acquired through business combinations Disposals Effects of foreign currency exchange differences Balance at September 30, 2020	941,618 112,865 - - (2,530) 1,051,953	3,033 8,289 1,117,819 (2,972) (12,848) 1,113,321	944,651 121,154 1,117,819 (2,972) (15,378) 2,165,274
Carrying amounts at September 30, 2020	\$ 561,884	\$ 138,809	\$ 700,693

16. BONDS PAYABLE

	September 30,	December 31,	September 30,
	2021	2020	2020
Unsecured domestic convertible bonds	\$	\$	\$
	98,901	1,207,820	1,684,222

In May 2020, the Company issued 20 thousand units, NT\$100,000 per unit, 0% NTD-denominated unsecured convertible bonds in Taiwan, with an aggregate principal amount of NT\$2,000,000 thousand. The terms of issuance, amounts and interest rate as follows:

• a. The conversion price was set at NT\$39.9 per share at the time of issuance. When meeting certain criteria, adjustments on the conversion price are made in accordance with the terms and conditions. Since the Company distributed cash dividends in August 2021, the conversion price should be adjusted according to issuance and conversion measures, the conversion price was adjusted to NT\$38 since August 22, 2021.
• b. After the first three months of the issuance and forty days before the maturity date, if the closing price of the Company's common shares listed on the Taiwan Stock Exchange exceeds or equals 30% of the conversion price or the outstanding balance of the bonds is less than 10% in principal amount of the bonds originally outstanding for thirty consecutive business days, the Company may redeem the bonds in cash at the principal amount.
• c. After the bonds has been issued for over five years, the bondholders may request the Company to redeem the bonds at 106.41% of the principal amount (annual rate of return 1.25%). The right of the redemption was recognized as financial instruments at fair value through profit or loss - current. The fair value was NT\$1,806 thousand, NT\$9,095 thousand and NT\$7,532 thousand on September 30, 2021, December 31, 2020 and September 30, 2020, respectively.
• d. Except for the bonds that have been redeemed, sold back, converted, or bought back by the Company in the market, the principal will be repaid in cash upon maturity at a rate of 109.09% (annual rate of return 1.25% upon maturity).

The effective interest rate of the convertible bonds liability component was 1.22% per annum on initial recognition.

Proceeds from issuance (less transaction costs of \$6,426 thousand)	\$ 1,998,428
The right of redemption	5,200
Liability component at the date of issue	2,003,628
Convertible bonds converted into ordinary shares	(1,925,558)
Interest charged at an effective interest rate of 1.22%	20,831
Liability component at September 30, 2021	\$ 98,901

17. BORROWINGS

a. Short-term borrowings

	September 30, 2021				December 31, 2020	September 30, 2020
	Interest Rate		Amount	Interest Rate	Amount	Interest Rate	Amount
Secured borrowings
Bank of Taiwan (Note 31) Chinatrust Commercial	-	\$	-	4.35%	\$ 1,544,910	4.35%	\$ 1,291,112
Bank Co., Ltd. (Note 30)	1.29%		74,700	1.29%	276,300	-	-
		\$	74,700		\$ 1,821,210		\$ 1,291,112

The short-term borrowings of Chinatrust Commercial Bank Co., Ltd. are secured and guaranteed by the parent company (refer to Note 30 to the consolidated financial statements).

b. Long-term borrowings

	Period	Interest Rate	September 30, 2021	December 31, 2020	September 30, 2020
Unsecured borrowings
The Export-Import Bank of ROC	2019.09.20- 2026.09.21	0.92%	\$ 500,000	\$ 500,000	\$ 500,000
The Export-Import Bank of ROC	2020.08.25- 2027.08.25	0.92%	1,000,000	1,000,000	1,000,000
Chinatrust Commercial Bank Co., Ltd.	2020.08.24- 2022.08.24	1.58%	-	-	800,000
Bank of Taiwan	2020.08.24- 2023.08.24	1.42%	-	-	1,000,000
			\$ 1,500,000	\$ 1,500,000	\$ 3,300,000

According to the contract, the long-term borrowings of Chinatrust Commercial Bank Co., Ltd. shall maintain a specific financial ratio (current ratio, debt ratio) and net tangible value shall not be less than a specific amount during the every half year. The calculation of the foregoing financial standards is based on the consolidated financial report audited (reviewed) by public accountants.

The proceeds of the Group's unsecured loan was invested in Autotalks Ltd and acquired Panasonic's semiconductor business in Japan.

To repay outstanding debt and enhance mid-term working capital, NTCJ entered into a JPY30 billion syndicated loan agreement with banks on May 17, 2021, which include Chinatrust Commercial Bank Co., Ltd. and other banks. Pursuant to the loan contract, the Company should directly or indirectly hold at least 100% of the issued shares or capital and maintain control over the operation of NTCJ, and NTCJ must maintain the financial debt ratio not to be lower than certain ratio during the loan period. The aforementioned financial ratio is calculated based on the audited consolidated financial statements.

Please refer to Note 31 to the consolidated financial statements for the collateral of the syndicated loan.

18. OTHER PAYABLES

	September 30, 2021	December 31, 2020	September 30, 2020
Payable for salaries or employee benefits	\$ 1,511,590	\$ 1,035,436	\$ 1,278,296
Payable for royalties	474,185	421,639	391,379
Payable for investment	265,525	242,960	242,960
Payable for utilities	222,037	172,638	176,485
Payable for maintenance	189,395	199,508	191,678
Payable for service	150,026	169,828	96,208
Payable for purchase of equipment	122,697	131,281	241,859
Payable for professional service	38,536	1,976	242,699
Payable for software	15,901	320,223	290,138
Others	1,430,042	1,312,785	1,215,580
	\$ 4,419,934	\$ 4,008,274	\$ 4,367,282

19. PROVISIONS

	September 30, 2021	December 31, 2020	September 30, 2020
Current
Decommissioning costs Employee benefits	\$ 551,784 -	\$ 612,281 316,438	\$ 610,730 316,438
	\$ 551,784	\$ 928,719	\$ 927,168
Non-current
Employee benefits Decommissioning costs Warranties	\$ 1,591,359 676,782 554,075	\$ 1,765,833 750,983 603,652	\$ 1,761,359 749,081 602,380
	\$ 2,822,216	\$ 3,120,468	\$ 3,112,820

The Group acquired Panasonic's semiconductor business in September 2020. Some fabs will be closed due to low capacity utilization, decommissioning costs and labor costs were accounted separately for decommissioning liabilities and employee benefit provision.

20. RETIREMENT BENEFIT PLANS

Employee benefit expense in respect of the Company's defined benefit retirement plans was calculated using the actuarially determined pension cost discount rate as of December 31, 2020 and 2019, and recognized NT\$10,988 thousand, NT\$10,071 thousand, NT\$31,578 thousand and NT\$29,712 thousand for the three months ended and nine months ended September 30, 2021 and 2020, respectively.

21. EQUITY

a. Share capital

Ordinary shares

	September 30,	December 31,	September 30,
	2021	2020	2020
Shares authorized (in thousands of shares)	500,000	500,000	500,000
Shares authorized	\$	\$	\$
	5,000,000	5,000,000	5,000,000
Shares issued and fully paid (in thousands of
shares)	410,043	375,962	287,554
Shares issued and fully paid	\$	\$	\$
	4,100,427	3,759,616	2,875,544
Par value (in New Taiwan dollars)	\$	\$	\$
	10	10	10

On August 21, 2020, the Company's Board of Directors resolved to issue 80,000 thousand ordinary shares with a par value of NT\$10 to repay bank loans and enhance working capital. On September 25, 2020, the resolution was approved by the FSC. The consideration of NT\$38 per share was determined by the chairman which was authorized by the Board of Directors of the Company, the subscription base date was December 10, 2020. The associated issuance cost of NT\$8,832 thousand was deducted from capital surplus - additional paid-in capital.

For the nine months ended September 30, 2021, the Company has issued 28,816 thousand shares of ordinary shares due to the conversion of unsecured convertible bonds, the registration of 7,167 thousand ordinary shares issuance has not been completed as of September 30, 2021.

As of September 30, 2021, December 31, 2020 and September 30, 2020, the balance of the Company's capital account amounted to NT\$4,100,427 thousand, NT\$3,759,616 thousand and NT\$2,875,544 thousand, divided into 410,043 thousand ordinary shares, 375,962 thousand ordinary shares and 287,554 thousand ordinary shares with a par value of NT\$10.

b. Capital surplus

	September 30, 2021	December 31, 2020	September 30, 2020
May be used to offset a deficit, distributed as cash dividends, or transferred to share capital*
Additional paid-in capital Conversion of bonds	\$ 5,088,159 1,409,563	\$ 5,088,159 596,347	\$ 2,856,991 242,650
May only be used to offset a deficit
Cash capital increase reserved for employee share options Overdue dividends unclaimed	112,160 62	112,160 52	49,920 52
May not be used for any purpose
Employee share options	13	13	13
	\$ 6,609,957	\$ 5,796,731	3,149,626 \$

• * Such capital surplus may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Company's capital surplus and to once a year).
• c. Retained earnings and dividends policy

The shareholders held their regular meeting on May 29, 2020 and resolved the amendments to the Company's dividend distribution policy in the Company's Articles of Incorporation (the "Articles"). Under the dividends policy as set forth in the amended Articles, where the Company made a profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit, setting aside or reversing a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company's Board of Directors as the basis for proposing a distribution plan, which should be resolved in the shareholders' meeting for the distribution of dividends and bonuses to shareholders. The Board of Directors shall be authorized to distribute the profit, the legal reserve, and the capital plus in cash upon resolution by a majority vote at a board meeting attended by two-thirds or more of the directors, and shall report the same to the shareholders' meeting. In principle, not less than 10% of the total shareholders' bonus shall be distributed in the form of cash. For the policies on the distribution of employees' compensation and remuneration of directors, refer to employees' compensation and remuneration of directors in Note 24 to the consolidated financial statements.

Appropriation of earnings to a legal reserve shall be made until the legal reserve equals the Company's paid-in capital. The legal reserve may be used to offset deficits. If the Company has no deficit and the legal reserve has exceeded 25% of the Company's paid-in capital, the excess may be transferred to capital or distributed in cash.

The dividends per share for 2020 and 2019 had been resolved by the Company's Board of Directors on March 16, 2021 and March 12, 2020, respectively. The number of ordinary shares outstanding and dividends per share for 2020 were affected by convertible bonds converted to ordinary shares. The appropriation of earnings for 2020 and 2019 were approved in the shareholders' meetings on August 20, 2021 and May 29, 2020, respectively, were as follows:

		Appropriation of Earnings
	For Year 2020	For Year 2019	For Year 2020	(NT\$) For Year 2019
Legal reserve Cash dividends	\$ 58,610 311,733	\$ 55,183 345,065	\$0.76	\$1.20
	\$ 370,343	\$ 400,248

d. Other equity items

1) The exchange differences arising on translation of foreign operations' net assets from its functional currency to the Group's presentation currency (New Taiwan dollar) are recognized directly in other comprehensive income. For the three months ended September 30, 2021 and 2020 and the nine months ended September 30, 2021 and 2020, other comprehensive loss was NT\$76,174 thousand, NT\$98,660 thousand, NT\$697,697 thousand and NT\$116,725 thousand, respectively.

2) Unrealized valuation gains (losses) on financial assets at FVTOCI

	September 30	For the Nine Months Ended
	2021	2020
Balance at January 1 Recognized for the period Cumulative unrealized gains (losses) of equity instruments	\$ 269,065 806,980	\$ 169,544 (61,242)
transferred to retained earnings due to disposal	(138,095)	-
Balance at September 30	\$ 937,950	\$ 108,302

Unrealized gains (losses) on financial assets at FVTOCI represents the cumulative gains or losses arising from the fair value measurement on financial assets at FVTOCI that are recognized in other comprehensive income. The cumulative gain or loss will not be reclassified to profit or loss on disposal of the equity investments, instead, they will be transferred to retained earnings.

22. REVENUE

Refer to Note 35 to the consolidated financial statements for the Group's revenue.

23. INCOME TAXES RELATING TO CONTINUING OPERATIONS

a. Income tax recognized in profit or loss

Major components of income tax expense are as follows:

	September 30	For the Three Months Ended	For the Nine Months Ended September 30
	2021	2020	2021	2020
Current tax
In respect of the current year	\$ 166,398	\$ 78,617	\$ 453,048	\$ 176,148
Adjustment for prior years' tax	-	(172)	(189)	(11,417)
Deferred tax
In respect of the current year	24,990	11,015	25,296	561
Income tax expense recognized in profit or loss	\$ 191,388	\$ 89,460	\$ 478,155	\$ 165,292

b. Income tax assessments

The income tax returns through 2018 have been assessed by the tax authorities.

24. EMPLOYEE BENEFITS EXPENSE, DEPRECIATION AND AMORTIZATION

					For the Three Months Ended September 30
			2021		2020
	Classified as Operating Costs	Classified as Operating Expenses	Classified as Non-operating Income and Losses	Total	Classified as Operating Costs	Classified as Operating Expenses	Classified as Non-operating Income and Losses	Total
Employee benefits expense Short-term employment benefits	\$ 310,058	\$ 1,892,427	\$ -	\$ 2,202,485	\$ 228,751	\$ 802,418	\$ -	\$ 1,031,169
Post-employment
benefits Depreciation	10,682 129,279	129,456 98,946	- 38,361	140,138 266,586	11,464 74,513	73,530 59,770	- 14,907	84,994 149,190
Amortization	4,604	55,099	-	59,703	8,562	42,547	-	51,109
					For the Nine Months Ended September 30
			2021			2020
	Classified as Operating Costs	Classified as Operating Expenses	Classified as Non-operating Income and Losses	Total	Classified as Operating Costs	Classified as Operating Expenses	Classified as Non-operating Income and Losses	Total
Employee benefits expense Short-term employment benefits	\$ 896,564	\$ 5,522,939	\$ -	\$ 6,419,503	\$ 604,096	\$ 1,826,079	\$ -	\$ 2,430,175
Post-employment
benefits	24,090	373,837	-	397,927	26,515	145,117	-	171,632
Depreciation	409,024	296,927	117,834	823,785	139,079	157,117	17,101	313,297
Amortization	20,182	154,549	-	174,731	25,243	95,911	-	121,154

According to the Company's Articles, the Company accrued employees' compensation and remuneration of directors at rates of no less than 1% and no higher than 1%, respectively, of net profit before income tax, employees' compensation, and remuneration of director.

For the three months ended September 30, 2021 and 2020 and the nine months ended September 30, 2021 and 2020, the employees' compensation and remuneration of directors were as follows:

	For the Three Months Ended September 30			For the Nine Months Ended September 30
		2021		2020		2021		2020
Employees' cash compensation Remuneration of directors	\$	50,339 8,390	\$	12,341 2,056	\$	140,003 23,334	\$	38,254 6,375

The employees' compensation and remuneration to the directors of 2020 and 2019, which were approved by the Company's Board of Directors on February 18, 2021 and February 6, 2020, respectively, were as below:

	For Year 2020		For Year 2019
	Amount	%	Amount	%
Employees' cash compensation	\$ 42,422	6	\$ 40,868	6
Remuneration of directors	7,070	1	6,811	1

There is no difference between the actual amounts of employees' compensation and remuneration of directors paid and the amounts recognized in the consolidated financial statements for the years ended December 31, 2020 and 2019.

Information on the employees' compensation and remuneration of directors resolved by the Company's Board of Directors in 2021 and 2020 is available at the Market Observation Post System website of the Taiwan Stock Exchange.

25. SHARE-BASED PAYMENT ARRANGEMENTS

The Company's Board of Directors resolved to reserve 10% of the shares from the issuance of 80,000 thousand shares approved by the FSC on September 25, 2020 to be subscribed for by its employees. The number of shares subscribed for by the employees was affirmed on October 21, 2020. The fair value of such share options subscribed for by the Company's employees on the grant date was measured using the Black-Scholes Option Pricing Model and amounted to NT\$62,240 thousand which was recorded as compensation costs with a corresponding increase in capital surplus.

a. As of December 31, 2020, the Company's Share-based payments agreements were as follows:

		Number of Shares
Agreement	Grant Date	Grant	Vesting Conditions
Cash capital increase reserved for employee share options	October 21, 2020	8,000 thousand shares	Vested immediately

b. The fair value of share options acquired by employees on grant day, October 21, 2020, was measured by using Black-Scholes Option Pricing Model. Relevant information was as follows:

Share Price (NT\$)	Exercise Price (NT\$)	Expected Price Volatility	Expected Vesting Period	Expected Dividend Yield Rate	Risk-free Interest Rate	Fair Value Per Share (NT\$)
\$45.6	\$38.0	34.80%	48 days	0.00%	0.18%	\$7.78

26. EARNINGS PER SHARE

	2021
Amounts (Numerator)		Earnings Per Share (NT\$)	Amounts (Numerator)		Earnings Per Share (NT\$)
After Income		After Income	After Income		After Income
(Attributable to Owners of the Company)	Shares (Denominator) (In Thousands)	(Attributable to Owners of the Company)	(Attributable to Owners of the Company)	Shares (Denominator) (In Thousands)	Tax (Attributable to Owners of the Company)
\$ 642,263	412,120	\$ 1.56	\$ 119,337	287,990	\$ 0.41
- 724	1,045 7,645		- 4,857	915 43,139
					\$ 0.37
	Tax \$ 642,987	420,810	Tax \$ 1.53	Tax \$ 124,194	For the Three Months Ended September 30 2020 332,044

				For the Nine Months Ended September 30
		2021			2020
	Amounts (Numerator)		Earnings Per Share (NT\$)	Amounts (Numerator)		Earnings Per Share (NT\$)
	After Income Tax		After Income Tax	After Income Tax		After Income Tax
	(Attributable to Owners of the Company)	Shares (Denominator) (In Thousands)	(Attributable to Owners of the Company)	(Attributable to Owners of the Company)	Shares (Denominator) (In Thousands)	(Attributable to Owners of the Company)
Basic earnings per share Net profit attributed to owners of the Company Effect of potentially dilutive	\$ 1,852,052	399,736	\$ 4.63	\$ 463,228	287,701	\$ 1.61
ordinary shares Employees' compensation Convertible bonds	- 5,699	1,210 20,029		- 7,207	1,048 21,097
Diluted earnings per share Net profit attributed to owners of the Company	\$ 1,857,751	420,975	\$ 4.41	\$ 470,435	309,846	\$ 1.52

If the Company offered to settle the compensation or bonuses paid to employees in cash or shares, the Company assumed that the entire amount of the compensation or bonuses will be settled in shares, and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted EPS, as the effect is dilutive. The number of shares used in the computation of diluted EPS is estimated by the amount of compensation divided by the closing price of the potential common shares at the end of the reporting period. Such dilutive effect of the potential shares is included in the computation of diluted EPS until the number of shares to be distributed to employees is resolved in the following year.

27. BUSINESS COMBINATIONS

a. Subsidiaries acquired

	Principal Activity	Date of Acquisition	Proportion of Voting Equity Interests Acquired (%)	Consideration Transferred
Panasonic Semiconductor business	Semiconductor business	September 1, 2020	100	\$ 8,432,481

The Group acquired the semiconductor business of Panasonic Corporation on September 1, 2020, including the acquisition of 100% equity in NTHJ, NTCJ (formerly PSCS), AMTC (formerly PIDE) and METC (formerly PIDST), Panasonic Semiconductor (Suzhou) Co., Ltd. (referred to as PSCSZ) related semiconductor business equipment and inventory, and Panasonic Industrial Devices Semiconductor Asia (referred to as PIDSCA) assets and liabilities projects and contracts and other specific operating assets.

b. Consideration transferred

	Panasonic Semiconductor Business
Cash	\$ 8,358,041
Contingent consideration arrangement*	74,440
	\$ 8,432,481

• * Under the contingent consideration arrangement, if the TPSCo. held by NTCJ Company (formerly PSCS) is a net profit after tax from the acquisition date to March 31, 2022, the net profit after tax must be reimbursed to Panasonic based on the shareholding ratio (49%).
• c. Assets acquired and liabilities assumed at the date of acquisition

		Panasonic Semiconductor Business
	Current assets
	Cash and cash equivalents	\$ 1,102,882
	Accounts receivable and other receivables	4,469,464
	Inventories	4,613,102
	Prepayments	216,082
	Non-current assets
	Financial asset at measured at fair value through other comprehensive income	960,800
	Property, plant and equipment	6,241,162
	Investment property	2,503,591
	Right-of-use assets	997,787
	Intangible assets	83,046
	Deferred tax assets	103,259
	Other assets	4,639
	Total assets	\$ 21,295,814
	Current liabilities
	Accounts payable and other payables	\$ 5,999,366
	Current tax liabilities	86,320
	Provisions - current	617,821
	Lease liabilities - current	176,138
	Other current liabilities	57,635
	Non-current liabilities
	Provisions - non-current	2,539,589
	Net defined benefit liabilities - non-current	1,473,458
	Deferred tax liabilities	89,169
	Products guarantee based on commitment	506,301
	Lease liabilities - non-current	1,156,925
	Total liabilities	\$ 12,702,722
	Net assets	\$ 8,593,092
d.	Gain on the bargain purchase
		Panasonic Semiconductor Business
	Fair value of identifiable net assets obtained	\$ 8,593,092

Less: Consideration transferred (8,432,481)

Gain on the bargain purchase \$ 160,611

The Group has completed to measure and allocate aforementioned assets and liabilities at fair value for the acquisition of Panasonic semiconductor business on June 16, 2021, NT\$(58,357) thousand was recognized in non-operating income and expenses to decrease gain on the bargain purchase in 2021.

e. Net cash outflow on the acquisition of subsidiaries

	Panasonic Semiconductor Business
Consideration paid in cash	\$ 8,432,481
Less: Cash and cash equivalent balances acquired	(1,102,882)
	7,329,599
Acquisition price adjustment
Investment payable	(74,440)
Business tax refund receivable	133,101
Other payable for contract (presented in provisions)	(316,438)
Effects of foreign currency exchange differences	(7,324)
	\$ 7,064,498

f. Impact of acquisitions on the results of the Group

The financial results of the acquirees from the acquisition dates (September 1, 2020) to December 31, 2020, which are included in the consolidated statements of comprehensive income, are as follows:

	Panasonic Semiconductor Business
From September 1, 2020 to December 31, 2020
Revenue Net Loss	\$ 8,993,175 \$ (460,607)

Because of the acquisition includes equipment and inventory related to semiconductor business of PSCSZ and assets and liabilities of PIDSCA, rather than a stand-alone entity, it is impractical to disclose the pro-forma revenue and the pro-forma profit.

28. CAPITAL MANAGEMENT

The Group's capital management objective is to ensure it has the necessary financial resources and operational plan so that it can cope with the next twelve months working capital requirements, capital expenditures, research and development expenses, debt repayments and dividends payments.

29. FINANCIAL INSTRUMENT

a. Categories of financial instruments

		September 30, 2021		December 31, 2020		September 30, 2020
	Carrying Amount	Fair Value	Carrying Amount	Fair Value	Carrying Amount	Fair Value
Financial assets
Financial assets at amortized cost (Note 1) Financial assets at FVTPL Derivative financial	\$ 12,161,486	\$ 12,161,486	\$ 12,489,674	\$ 12,489,674	\$ 10,288,605	\$ 10,288,605
assets	1,806	1,806	13,223	13,223	11,326	11,326
Financial assets at FVTOCI Investment in equity instruments	2,487,111	2,487,111	1,806,580	1,806,580	1,994,820	1,994,820
Financial liabilities
Financial liabilities at amortized cost (Note 2) Financial liabilities at FVTPL	9,715,185	9,969,728	12,257,989	12,534,077	14,416,059	14,596,450
Derivative financial liabilities	2,634	2,634	3,191	3,191	-	-

• Note 1: Including cash and cash equivalents, notes and accounts receivable (including related parties), other receivables and refundable deposits.
• Note 2: Including notes and accounts payable (including related parties), other payables, convertible bonds, short-term loans, long-term loans and guarantee deposits.
• b. Fair value information
• 1) Fair value measurements are grouped into Levels 1 to 3 based on the degree to which the fair value is observable and the significance in its entirety, which are described as follows:
  • a) Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;
  • b) Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
  • c) Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

• 2) Fair value measurements recognized in the consolidated balance sheets

  • a) The fair values of financial assets and financial liabilities with standard terms and conditions and traded on active liquid markets are determined with reference to quoted market prices (includes listed shares and emerging market shares).
  • b) The fair value of the financial instruments at fair value through profit or loss is based on Level 2 inputs, either directly or indirectly. The fair value of foreign-currency derivative financial instrument could be determined by reference to the price and discount rate of currency swap quoted by financial institutions. Foreign exchange forward contracts are measured using individual maturity rate to calculate the fair value of each contract.

• c) Domestic unlisted equity instruments at FVTOCI were all measured based on Level 3 fair value. Fair values of such equity instruments were determined using discounted cash flow of income approach and comparable listed company approach, by referring to strike price of similar business in active market, implied value multiple of the price and relevant information. Significant unobservable inputs included P/E ratio, value multiple and market liquidity discount. As the discounted cash flow method was used, the discount rate used for lack of marketability was 29%; which increase by 1% while all the other variables are held constant, the fair value of investments will decrease by NT\$7,845 thousand and NT\$8,831 thousand for the nine months ended September 30, 2021 and 2020, respectively.

• 3) Fair value of financial instruments not measured at fair value

	September 30, 2021
	Level 1	Level 2	Level 3	Total
Financial liabilities at amortized cost
Bonds payable (unsecured)	\$ 353,444	\$ -	\$ -	\$ 353,444
			December 31, 2020
	Level 1	Level 2	Level 3	Total
Financial liabilities at amortized cost
Bonds payable (unsecured)	\$ 1,483,908	\$ -	\$ -	\$ 1,483,908
			September 30, 2020
	Level 1	Level 2	Level 3	Total
Financial liabilities at amortized cost
Bonds payable (unsecured)	\$ 1,864,613	\$ -	\$ -	\$ 1,864,613

4) Fair value of financial instruments measured at fair value on a recurring basis

Fair value hierarchy

	September 30, 2021
	Level 1	Level 2	Level 3	Total
Financial assets at FVTPL
Derivative financial assets	\$ -	\$ 1,806	\$ -	\$ 1,806
Financial assets at FVTOCI
Domestic and overseas listed shares and emerging market
shares	\$ 246,792	\$ -	\$ -	\$ 246,792
Domestic and overseas unlisted
shares	\$ -	\$ -	\$ 2,240,319	\$ 2,240,319
Financial liabilities at FVTPL
Derivative financial liabilities	\$ -	\$ 2,634	\$ -	\$ 2,634

	December 31, 2020
	Level 1	Level 2	Level 3	Total
Financial assets at FVTPL
Derivative financial assets	\$ -	\$ 13,223	\$ -	\$ 13,223
Financial assets at FVTOCI
Domestic and overseas listed shares and emerging market shares	\$ 313,689	\$ -	\$ -	\$ 313,689
Domestic and overseas unlisted shares	\$ -	\$ -	\$ 1,492,891	\$ 1,492,891
Financial liabilities at FVTPL
Derivative financial liabilities	\$ -	\$ 3,191	\$ -	\$ 3,191
			September 30, 2020
	Level 1	Level 2	Level 3	Total
Financial assets at FVTPL
Derivative financial assets	\$ -	\$ 11,326	\$ -	\$ 11,326
Financial assets at FVTOCI
Domestic and overseas listed shares and emerging market shares	\$ 527,546	\$ -	\$ -	\$ 527,546
Domestic and overseas unlisted shares	\$ -	\$ -	\$ 1,467,274	\$ 1,467,274

5) Reconciliation of Level 3 fair value measurements of financial instruments

The financial assets measured at Level 3 fair value were financial assets at FVTPL and equity investments classified as financial assets at FVTOCI. Reconciliations for the nine months ended September 30, 2021 and 2020 were as follows:

	For the Nine Months Ended September 30
	2021	2020
Balance at January 1	\$ 1,492,891	\$ 1,056,205
Acquired through business combinations	-	450,882
Refund of capital reduction	(4,500)	(2,250)
Recognized in other comprehensive income	751,928	(37,563)
Balance at September 30	\$ 2,240,319	\$ 1,467,274

c. Financial risk management objectives and policies

The Group seeks to minimize the effects of financial risks by using derivative financial instruments to hedge risk exposures. The use of financial derivatives is governed by the Group's policies approved by the Board of Directors, which provide written principles on foreign currency risk, and the use of financial derivatives. Compliance with policies and exposure limits was reviewed by the internal auditors on a continuous basis.

1) Market risk

The Group's activities exposed it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. The Group entered into foreign exchange forward contracts to hedge the foreign currency risk arising on the export business.

a) Foreign currency risk

The Group has foreign currency denominated transactions, which expose the Group to foreign currency risk. Exchange rate exposures are managed within approved policy parameters utilizing foreign exchange forward contracts.

The carrying amounts of the Group's foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are set out in Note 34 to the consolidated financial statements.

The sensitivity analysis included only outstanding foreign currency denominated monetary items at the end of the reporting period and assuming an increase in net income and equity if New Taiwan dollars strengthen by 1% against foreign currencies. For a 1% weakening of New Taiwan dollars against the relevant currency, there would be impact on net income in the amounts of NT\$2,684 thousand increase and NT\$3,580 thousand increase for the nine months ended September 30, 2021 and 2020, respectively. The amounts used in the 1% weakening of New Taiwan dollars against the relevant currency did not consider the impact of hedge contracts and hedged item.

b) Interest rate risk

Interest rate risk refers to the risk that the change in market value will influence the fair value of financial instruments. The Group's interest rate risk arises primarily from floating rate deposits and long-term loans.

The carrying amounts of the Group's financial assets and financial liabilities with exposure to interest rates at the end of the reporting period were as follows:

	September 30, 2021	December 31, 2020		September 30, 2020
Cash flow interest rate risk
Financial assets	\$ 8,413	\$	7,749	\$	108,313
Financial liabilities	1,500,000		3,321,210		4,591,112

The sensitivity analysis of cash flows based on the Group's exposure to interest rates for fair value of variable-rate non-derivatives instruments at the end of the reporting period. If interest rates increased by 1%, the Group's cash outflows for the nine months ended September 30, 2021 and 2020 would have increased by NT\$11,187 thousand and increased by NT\$33,621 thousand, respectively.

2) Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in a financial loss to the Group, to mitigate the risk of financial loss from defaults, the Group has established risk procedures and is continuously assessing the credit risk of each counterparty, sufficient collateral will be obtained when necessary. In this regard, the management of the Group consider that the Group's credit risk was significantly reduced.

3) Liquidity risk

The Group has enough operating capital to comply with loan covenants; liquidity risk is low.

The Group's non-derivative financial liabilities and their agreed repayment period are as follows:

		September 30, 2021
	Within 1 Year	1-2 Years	Over 2 Years	Total
Non-derivative financial liabilities
Non-interest bearing Lease liabilities Variable interest rate	\$ 7,786,388 260,947	\$ - 214,978	\$ - 984,815	\$ 7,786,388 1,460,740
liabilities Fixed interest rate liabilities	- 74,700	- -	1,500,000 105,926	1,500,000 180,626
	\$ 8,122,035	\$ 214,978	\$ 2,590,741	\$ 10,927,754

Additional information about the maturity analysis of lease liabilities:

	Less than 2 Years	2-5 Years	Over 5 Years	Total
Non-derivative financial liabilities
Lease liabilities	\$ 475,925	\$ 396,484	\$ 588,331	\$ 1,460,740
		December 31, 2020
	Within 1 Year	1-2 Years	Over 2 Years	Total
Non-derivative financial liabilities
Non-interest bearing	\$ 7,659,385	\$ -	\$ -	\$ 7,659,385
Lease liabilities	308,294	264,121	1,231,072	1,803,487
Variable interest rate liabilities	1,821,210	-	1,500,000	3,321,210
Fixed interest rate liabilities	-	-	1,305,480	1,305,480
	\$ 9,788,889	\$ 264,121	\$ 4,036,552	\$ 14,089,562

Additional information about the maturity analysis of lease liabilities:

Non-derivative financial liabilities	Less than 2 Years	2-5 Years	Over 5 Years	Total
Lease liabilities	\$ 572,415	\$ 500,296	\$ 730,776	\$ 1,803,487
		September 30, 2020
	Within 1 Year	1-2 Years	Over 2 Years	Total
Non-derivative financial liabilities
Non-interest bearing Lease liabilities Variable interest rate	\$ 7,746,892 312,028	\$ - 271,508	\$ - 1,281,352	\$ 7,746,892 1,864,888
liabilities Fixed interest rate liabilities	- 1,291,112	800,000 -	2,500,000 1,825,948	3,300,000 3,117,060
	\$ 9,350,032	\$ 1,071,508	\$ 5,607,300	\$ 16,028,840

Additional information about the maturity analysis of lease liabilities:

	Less than 2 Years	2-5 Years	Over 5 Years	Total
Non-derivative financial liabilities
Lease liabilities	\$ 583,536	\$ 524,465	\$ 756,887	\$ 1,864,888

d. Transfers of financial assets

Factored accounts receivable that are not yet overdue on September 30, 2021, December 31, 2020, and September 30, 2020 respectively were as follows:

September 30, 2021

Counterparty	Receivables Factoring Proceeds	Advances Received - Unused	Advances Received - Used	Annual Interest Rates on Advances Received (Used) (%)
Sumitomo Mitsui Banking	\$	\$	\$	0.9
Corporation	96,419	-	96,419
December 31, 2020 Counterparty	Receivables Factoring Proceeds	Advances Received - Unused	Advances Received - Used	Annual Interest Rates on Advances Received (Used) (%)
Sumitomo Mitsui Banking	\$	\$	\$	0.9
Corporation	230,449	-	230,449

September 30, 2020

Counterparty	Receivables Factoring Proceeds	Advances Received - Unused	Advances Received - Used	Annual Interest Rates on Advances Received (Used) (%)
Sumitomo Mitsui Banking	\$	\$	\$	0.9
Corporation	251,611	-	251,611

Pursuant to the Group's factoring agreements, losses from commercial disputes (such as sales returns and discounts) are borne by the Group, while losses from credit risk are borne by the banks.

30. TRANSACTIONS WITH RELATED PARTIES

a. Related party name and categories

Related Party Name	Related Party Categories
Winbond Electronics Corporation ("WEC")	The Company's parent
Winbond Electronics (HK) Limited ("WEHK")	Associate
Winbond Electronics Corporation America ("WECA")	Associate
Winbond Electronics Corporation Japan ("WECJ")	Associate
Callisto Holding Limited	Associate
Tower Partners Semiconductor Co., Ltd. ("TPSCo.")	Related party in substance
Nyquest Technology Co., Ltd. ("Nyquest")	Related party in substance
Walton Advanced Engineering Inc.	Related party in substance
Chin Cherng Construction Co., Ltd.	Related party in substance
United Industrial Gases Co., Ltd.	Related party in substance
Glorystones Corporation	Related party in substance
Waltech Advanced Engineering (Suzhou), Inc. ("Waltech")	Related party in substance

b. Operating activities

	For the Three Months Ended September 30		For the Nine Months Ended September 30
	2021	2020	2021	2020
1) Operating revenue
Related party in substance
Waltech	\$ 1,183,472	\$ -	\$ 2,444,006	\$ -
Others	138,574	77,530	421,716	163,020
Associate	13,375	22,339	58,146	68,541
	\$ 1,335,421	\$ 99,869	\$ 2,923,868	\$ 231,561
2) Purchases of goods
Related party in substance
TPSCo.	\$ 1,580,420	\$ 771,855	\$ 4,943,642	\$ 771,855
Others	33,962	-	62,653	-
Parent company	122,658	56,632	288,848	141,197
	\$ 1,737,040	\$ 828,487	\$ 5,295,143	\$ 913,052

		For the Three Months Ended September 30	For the Nine Months Ended September 30
	2021	2020	2021	2020
3) Manufacturing expenses
Related party in substance TPSCo. Others	\$ 504,588 5,185	\$ - -	\$ 1,539,451 12,650	\$ - -
Parent company	88 \$ 509,861	59 \$ 59	529 \$ 1,552,630	279 \$ 279
4) Operating expenses
Related party in substance Parent company Associate	\$ 117,669 8,115 2,816 \$ 128,600	\$ 47,738 7,341 1,891 \$ 56,970	\$ 346,778 28,486 7,105 \$ 382,369	\$ 53,128 14,645 5,750 \$ 73,523
5) Dividend income
Related party in substance United Industrial Gases Co., Ltd. Nyquest Technology Co., Ltd.	\$ - 5,775	\$ - -	\$ 62,000 5,775	\$ 64,394 3,300
	\$ 5,775	\$ -	\$ 67,775	\$ 67,694
6) Other income
Related party in substance Parent company	\$ - -	\$ - (18)	\$ 339 -	\$ - 2
	\$ -	\$ (18)	\$ 339	\$ 2
		September 30, 2021	December 31, 2020	September 30, 2020
7) Accounts receivable from related parties
Related party in substance Waltech Others Associate		\$ 611,545 79,048 7,973	\$ - 77,760 12,817	\$ - 64,333 11,825
		\$ 698,566	\$ 90,577	\$ 76,158

	September 30, 2021	December 31, 2020		September 30, 2020
8) Other receivables
Related party in substance
TPSCo.	\$ 266,292	\$ 255,453	\$	288,662
Others	10,501	-		-
Associate	9,559	214		179
	\$ 286,352	\$ 255,667	\$	288,841

Other receivables - related parties is collection or payment on behalf of others.

	September 30, 2021	December 31, 2020	September 30, 2020
9) Refundable deposits
Parent company Related party in substance	\$ 1,780 1,722	\$ 1,780 1,722	\$ 1,780 1,722
	\$ 3,502	\$ 3,502	\$ 3,502
10) Accounts payable to related parties
Related party in substance TPSCo. Others Parent company	\$ 478,657 10,714 82,584 \$ 571,955	\$ 788,043 - 39,500 \$ 827,543	\$ 842,316 - 38,609 \$ 880,925
11) Other payables
Related party in substance Parent company	\$ 64,625 12,451	\$ 77,373 9,738	\$ 59,078 32,469
	\$ 77,076	\$ 87,111	\$ 91,547
12) Guarantee deposits
Parent company	\$ 545	\$ 545	\$ 545

The sales and purchase prices and collection and payment terms with related parties were not significantly different from those with third parties. For other related party transactions, price and terms were determined in accordance with mutual agreement.

13) Disposal of property, plant and equipment

		Proceeds		Gain (Loss) on Disposal
		For the Three Months Ended September 30		For the Three Months Ended September 30
	2021	2020	2021	2020
Related party in substance
Waltech	\$ 886	\$ -	\$ 886	\$ -
TPSCo.	150	-	117	-
	\$ 1,036	\$ -	\$ 1,003	\$ -
		Proceeds		Gain (Loss) on Disposal
		For the Nine Months Ended		For the Nine Months Ended
		September 30		September 30
	2021	2020	2021	2020
Related party in substance
Waltech	\$ 886,862	\$ -	\$ 144,679	\$ -
TPSCo.	150	-	117	-
	\$ 887,012	\$ -	\$ 144,796	\$ -

The price of above transaction were determined to base on the acquisition cost of the equipment and reference to the recent quoted market price.

c. Lease arrangements - Group is lessee

		September 30, 2021	December 31, 2020		September 30, 2020
1) Lease liabilities
Parent company Related party in substance Associate		\$ 39,133 14,116 1,875	\$ 47,969 22,451 7,566	\$	51,011 25,070 9,621
		\$ 55,124	\$ 77,986	\$	85,702

			For the Three Months Ended September 30		For the Nine Months Ended September 30
		2021		2020		2021		2020
2)	Interest expense
	Parent company	\$ 107	\$	138	\$	343	\$	439
	Related party in substance	60		104		215		344
	Associate	17		92		111		330
		\$ 184	\$	334	\$	669	\$	1,113

d. Lease arrangements - Group is lessor/Sublease arrangements

Sublease arrangements under operating leases

For the nine months ended September 30, 2021 and 2020, the Group subleases its right-of-use assets to its associate companies WEC, WEHK and TPSCo. under operating leases with lease terms between 1 and 12 years, and the rental is based on similar asset's market rental rates and fixed lease payments are received monthly.

1) The balance of operating lease receivables was as follows:

	September 30, 2021		December 31, 2020		September 30, 2020
Related party in substance
TPSCo.	\$	-	\$ 23,504	\$	-
Parent company		1,035	-		511
Associate		238	245		250
	\$	1,273	\$ 23,749	\$	761

2) Future lease payment receivables are as follows:

	September 30, 2021	December 31, 2020	September 30, 2020
Related party in substance Parent company Associate	\$ 1,721,586 4,890 833	\$ 1,635,005 11,133 1,948	\$ 1,013,831 7,620 2,363
	\$ 1,727,309	\$ 1,648,086	\$ 1,023,814

3) Lease income was as follows:

	For the Three Months Ended September 30				For the Nine Months Ended September 30
		2021		2020		2021		2020
Related party in substance Parent company Associate	\$	58,720 1,094 357	\$	21,483 984 377	\$	180,187 3,083 1,080	\$	21,483 2,903 1,155
	\$	60,171	\$	22,844	\$	184,350	\$	25,541

e. Endorsements and guarantees

Endorsements and guarantees provided by the Group

The chairman of the Company is a joint guarantor of the land-leasing from Taiwan Sugar Corporation. Refer to Note 13 to the consolidated financial statements.

Endorsements and guarantees given by related parties

Related Party Category	September 30,	December 31,	September 30,
	2021	2020	2020
Parent company	\$	\$	\$
Amount endorsed	11,471,679	4,440,417	4,464,524
Amount utilized (reported as secured bank	\$	\$	\$
loans)	74,700	276,300	-

f. Compensation of key management personnel

	For the Three Months Ended September 30			For the Nine Months Ended September 30
		2021		2020		2021		2020
Short-term employee benefits Post-employment benefits	\$	55,156 943	\$	24,110 722	\$	153,905 2,606	\$	72,405 1,999
	\$	56,099	\$	24,832	\$	156,511	\$	74,404

The remuneration of directors and key executives, as determined by the remuneration committee, was based on the performance of individuals and market trends.

31. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets were provided as collateral for land leases, customs tariff obligations and bank borrowings:

	September 30,	December 31,	September 30,
	2021	2020	2020
Land	\$	\$	\$
	1,459,046	-	-
Buildings	734,395	-	-
Investment properties	448,699	-	-
Time deposits (accounted as refundable deposits)	107,168	636,102	86,309
	\$	\$	\$
	2,749,308	636,102	86,309

32. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

Significant contingent liabilities and unrecognized commitments of the Group as of the end of the reporting period, excluding those disclosed in other notes, were as follows:

L Company filed a complaint in the U.S. District Court for the District of Delaware on April 29, 2021. The plaintiff alleged that NTCA (and NTCA only) infringes one of its patents. On June 22, 2021, NTCA signed the authorization and settlement agreement. According to the agreement, L Company then withdrew the complaint in the U.S. District Court for the District of Delaware on June 30, 2021.

The Company and NTCA received a complaint served by the court on June 29, 2020. The plaintiff charged in the California High Court that the gasoline generator produced by HD POWER SYSTEMS INC., exploded during use and caused damage to it. At the same time, the Company, NTCA and other related companies shall bear the relevant compensation liabilities. The plaintiff applied to withdraw the complaint against the Company in the Court on June 29, 2021, and applied to withdraw the complaint against NTCA in the Court on July 7, 2021. The court has filed an order of dismissal, the case was closed.

33. OTHER ITEMS

The novel coronavirus (Covid-19) spreads all over the world, causing subsidiaries, customers and suppliers in some regions to implement quarantine and travel restrictions. The Group evaluated that there is no significant impact on the overall business operation and financial position of the Group. There are no concerns about the capability of the Group to be going concern, and the risk of assets impairment and fund raising.

34. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The Group's significant financial assets and liabilities denominated in foreign currencies aggregated by the foreign currencies other than functional currency of the entities in the Group and the related exchange rates between foreign currencies and respective functional currency were as follows:

		September 30, 2021
	Foreign Currencies (Thousand)	Exchange Rate (Note)	New Taiwan Dollars (Thousand)
Financial assets
Monetary items USD ILS RMB JPY	\$ 77,026 23,492 15,161 116,136	27.85 8.6542 4.305 0.249	\$ 2,145,169 203,300 65,269 28,918
Financial liabilities
Monetary items USD ILS RMB JPY	59,604 25,018 5,635 1,139,575	27.85 8.6542 4.305 0.249	1,659,968 216,510 24,257 283,754
		December 31, 2020
Financial assets	Foreign Currencies (Thousand)	Exchange Rate (Note)	New Taiwan Dollars (Thousand)
Monetary items USD ILS RMB JPY	\$ 57,028 20,800 8,724 48,824	28.48 8.8712 4.377 0.276	\$ 1,624,156 184,522 38,186 13,490 (Continued)

	December 31, 2020
		Foreign Currencies (Thousand)	Exchange Rate (Note)	New Taiwan Dollars (Thousand)
Financial liabilities
Monetary items USD	\$	46,275	28.48	\$ 1,317,309
ILS		18,706	8.8712	165,943
RMB		7,098	4.377	31,067
JYP		68,971	0.276	19,057
				(Concluded)
			September 30, 2020
		Foreign Currencies (Thousand)	Exchange Rate (Note)	New Taiwan Dollars (Thousand)
Financial assets
Monetary items
USD	\$	57,390	29.10	\$ 1,670,061
ILS		16,628	8.4314	140,198
RMB		9,512	4.269	40,605
JPY		31,777	0.2756	8,758
Financial liabilities
Monetary items
USD		44,595	29.10	1,297,727
ILS		17,462	8.4314	147,230
RMB		7,360	4.269	31,419
JPY		75,895	0.2756	20,917

Note: The rate foreign currencies are exchanged to New Taiwan dollars and displayed as a rate.

For the three months ended September 30, 2021 and 2020 and the nine months ended September 30, 2021 and 2020, realized and unrealized net foreign exchange gains (losses) were NT\$5,683 thousand, NT\$18,146 thousand, NT\$(28,010) thousand and NT\$14,833 thousand, respectively. It is impractical to disclose net foreign exchange gains and losses by each significant foreign currency due to the variety of the foreign currency transactions and functional currencies of the entities in the Group.

35. SEGMENT INFORMATION

• a. Basic information about operating segment
• 1) Classification of operating segments

The Group's reportable segments under IFRS 8 and IAS 34 were as follows:

a) General IC product segment

The general IC product segment engages mainly in research, design, manufacturing, sale and after-sales service.

b) Foundry service segment

The foundry service segment engages mainly in research, design, manufacturing and sale.

2) Principles of measuring reportable segments profit, assets and liabilities

The significant accounting principles of each operating segment are the same as those stated in Note 4 to the consolidated financial statements. The Group's operating segment profit or loss represents the profit or loss earned by each segment. The profit or loss is controllable by segment managers and is the basis for assessment of segment performance. The Group does not provide information on assets regularly to the Group's chief operating decision maker; thus, the measure of assets is zero. Major liabilities are arranged based on the capital cost and deployment of the whole company, which are not controlled by individual segment managers.

b. Segment revenues and operating results

The following is an analysis of the Group's revenue from continuing operations by reportable segments.

		Segment Revenue	Segment Profit and Loss For the Nine Months Ended September 30 2021 2020
		For the Nine Months Ended
	2021	September 30 2020
General IC products	\$ 26,512,342	\$ 8,927,979	\$ 3,439,820	\$ 1,142,623
Foundry service	1,770,632	1,514,473	736,338	519,045
Total of segment revenue	28,282,974	10,442,452	4,176,158	1,661,668
Other revenue	2,784,349	356,414	1,272,418	73,023
Operating revenue	\$ 31,067,323	\$ 10,798,866	5,448,576	1,734,691
Unallocated expenditure
Administrative and
supporting expenses			(2,198,501)	(902,153)
Sales and other common
expenses			(1,136,852)	(548,102)
Income from operations			2,113,223	284,436
Finance costs			(60,925)	(33,567)
Interest income			24,439	18,552
Dividend income			67,845	67,746
Gain on the bargain purchase			-	218,968
Other gains and losses			79,657	43,574
Gains (losses) on disposal of
property, plant and
equipment			125,564	10,057
Gains (losses) on disposal of
intangible assets			(4,803)	-
Foreign exchange gains (losses)			(28,010)	14,833
Gains (losses) on financial
instruments at fair value
through profit or loss			13,217	3,921
Profit before income tax			\$ 2,330,207	\$ 628,520