OSE - Interim / Quarterly Report 2023

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’ REVIEW REPORT MARCH 31, 2023 AND 2022

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

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INDEPENDENT AUDITORS’ REVIEW REPORT TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of Orient Semiconductor Electronics, Limited.

Introduction

We have reviewed the accompanying consolidated balance sheets of Orient Semiconductor Electronics, Limited and subsidiaries (the “Group”) as at March 31, 2023 and 2022, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the three-month periods then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” that came into effect as endorsed by the Financial Supervisory Commission. Our responsibility is to express a conclusion on these consolidated financial statements based on our reviews.

Scope of review

Except as explained in the following paragraph, we conducted our reviews in accordance with the Standard on Review Engagements 2410, “Review of Financial Information Performed by the Independent Auditor of the Entity” of the Republic of China. A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis for qualified conclusion

As explained in Notes 4(3) B and 6(6), the financial statements of certain insignificant consolidated subsidiaries, investments accounted for using equity method and information disclosed in Note 13 were not reviewed by independent auditors. Total assets of these subsidiaries (including investments accounted for using equity method) amounted to NT$781,719 thousand and NT$1,885,959 thousand, constituting 5% and 11% of the consolidated total assets as at March 31, 2023 and 2022, respectively, total liabilities amounted to NT$150,719 thousand and NT$187,664 thousand, constituting 2% and 3% of the consolidated total liabilities as at March 31, 2023 and 2022, respectively, and the total comprehensive loss

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(including share of profit or loss of associates and joint ventures accounted for using equity method) amounted to (NT$13,865) thousand and NT$14,114 thousand, constituting (3%) and 4% of the consolidated total comprehensive (loss) income for the three-month periods then ended, respectively.

Qualified conclusion

Except for the adjustments to the consolidated financial statements, if any, as might have been determined to be necessary had the financial statements of certain consolidated subsidiaries, investment accounted for using equity method and information disclosed in Note 13 been reviewed by independent auditors as described in the Basis for qualified conclusion section above, based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as at March 31, 2023 and 2022, and of its consolidated financial performance and its consolidated cash flows for the three-month periods then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” that came into effect as endorsed by the Financial Supervisory Commission.

PricewaterhouseCoopers, Taiwan

Wang, Kuo-Hua[Chiang, Tsai-Yen ]

For and on behalf of PricewaterhouseCoopers, Taiwan April 26, 2023

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

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

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ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS MARCH 31, 2023, DECEMBER 31, 2022 AND MARCH 31, 2022

(The balance sheets as of March 31, 2023 and 2022 are reviewed, not audited)

Assets	Notes	March 31, 2023 AMOUNT % `$` `3,292,177 20` `243,520` `2` `243,424` `2` `103` `-` `2,984,468 18` `76` `-` `34,028` `-` `-` `-` `89` `-` `1,521,913` `9` `107,082` `1` `-` `-` `25,015` `-` `8,451,895 52` `1,311,998` `8` `1,704` `-` `5,128,296 32` `161,517` `1` `79,246` `1` `990,246` `6` `46,995` `-` `16,461` `-` `2,760` `-` `7,739,223 48` `$` `16,191,118 100`	December 31, 2022 AMOUNT % `$` `3,945,818` `23` `245,600` `1` `272,248` `2` `155` `-` `3,022,087` `18` `399` `-` `38,894` `-` `-` `-` `-` `-` `1,818,028` `11` `107,990` `1` `-` `-` `23,812` `-` `9,475,031` `56` `1,021,427` `6` `1,843` `-` `5,220,775` `31` `166,755` `1` `47,547` `-` `973,068` `6` `20,581` `-` `17,098` `-` `2,659` `-` `7,471,753` `44` `$` `16,946,784` `100`	March 31, 2022	March 31, 2022
		AMOUNT `$` `3,292,177` `243,520` `243,424` `103` `2,984,468` `76` `34,028` `-` `89` `1,521,913` `107,082` `-` `25,015` `8,451,895` `1,311,998` `1,704` `5,128,296` `161,517` `79,246` `990,246` `46,995` `16,461` `2,760` `7,739,223` `$` `16,191,118`	AMOUNT `$` `3,945,818` `245,600` `272,248` `155` `3,022,087` `399` `38,894` `-` `-` `1,818,028` `107,990` `-` `23,812` `9,475,031` `1,021,427` `1,843` `5,220,775` `166,755` `47,547` `973,068` `20,581` `17,098` `2,659` `7,471,753` `$` `16,946,784`	AMOUNT `$` `3,174,199` `-` `285,944` `-` `2,765,479` `305,112` `39,657` `10,285` `-` `1,860,808` `105,578` `136,137` `16,102` `8,699,301` `475,616` `480,762` `5,447,670` `191,772` `33,225` `1,116,587` `42,880` `134,555` `3,317` `7,926,384` `$` `16,625,685`	%
Current assets 1100 Cash and cash equivalents 1136 Current financial assets at amortised cost 1140 Current contract assets 1150 Notes receivable, net 1170 Accounts receivable, net 1180 Accounts receivable due from related parties, net 1200 Other receivables 1210 Other receivables due from related parties 1220 Current tax assets 130X Inventories 1410 Prepayments 1460 Non-current assets or disposal groups classified as held for sale, net 1479 Other current assets, others 11XX Current Assets Non-current assets 1517 Non-current financial assets at fair value through other comprehensive income 1550 Investments accounted for using equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1780 Intangible assets 1840 Deferred tax assets 1915 Prepayments for business facilities 1920 Guarantee deposits paid 1990 Other non-current assets, others 15XX Non-current assets 1XXX Total assets	6(1) 6(3) 6(21) 6(4) 6(4) 6(4) and 7 7 6(5) 6(11) 6(2) 6(6) 6(7) and 8 6(8) 6(10) 8				`19` `-` `2` `-` `16` `2` `-` `-` `-` `11` `1` `1` `-`
					`52`
					`3` `3` `33` `1` `-` `7` `-` `1` `-`
					`48`
					`100`

(Continued)

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ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS MARCH 31, 2023, DECEMBER 31, 2022 AND MARCH 31, 2022

(The balance sheets as of March 31, 2023 and 2022 are reviewed, not audited)

Liabilities and Equity	Notes	March 31, 2023 AMOUNT % `$` `-` `-` `76,268` `1` `-` `-` `2,479,884` `15` `8` `-` `834,457` `5` `24,932` `-` `46,928` `-` `14,382` `-` `28,057` `-` `2,904` `-` `27,853` `-` `59,185` `1` `3,594,858` `22` `1,146,058` `7` `126,300` `1` `1,003,532` `6` `134,845` `1` `38,085` `-` `2,448,820` `15` `6,043,678` `37` `5,553,083` `34` `1,801,800` `11` `238,387` `2` `192,241` `1` `157,357` `1` `2,180,422` `14` `24,150` `-` `10,147,440` `63` `10,147,440` `63` `$` `16,191,118` `100`	December 31, 2022 AMOUNT % `$` `-` `-` `77,879` `-` `-` `-` `3,042,415` `18` `736` `-` `1,299,565` `8` `20,000` `-` `123,863` `1` `14,439` `-` `27,958` `-` `-` `-` `21,068` `-` `56,398` `-` `4,684,321` `27` `1,148,962` `7` `133,352` `1` `1,003,851` `6` `185,658` `1` `39,864` `-` `2,511,687` `15` `7,196,008` `42` `5,553,299` `33` `1,801,800` `11` `238,171` `1` `192,241` `1` `157,357` `1` `2,000,701` `12` `(` `192,793) (` `1)(` `9,750,776` `58` `9,750,776` `58` `$` `16,946,784` `100`	March 31, 2022 AMOUNT % `$` `636,717` `4` `89,293` `1` `2,452` `-` `3,114,017` `19` `1,494` `-` `1,036,128` `6` `46,324` `-` `-` `-` `11,063` `-` `31,820` `-` `15,375` `-` `26,005` `-` `166,342` `1` `5,177,030` `31` `535,587` `3` `159,873` `1` `1,004,829` `6` `339,116` `2` `55,050` `1` `2,094,455` `13` `7,271,485` `44` `5,554,167` `33` `1,801,800` `11` `235,049` `1` `53,719` `-` `106,988` `1` `1,752,584` `11` `150,107) (` `1)` `9,354,200` `56` `9,354,200` `56` `$` `16,625,685` `100`
		AMOUNT `$` `-` `76,268` `-` `2,479,884` `8` `834,457` `24,932` `46,928` `14,382` `28,057` `2,904` `27,853` `59,185` `3,594,858` `1,146,058` `126,300` `1,003,532` `134,845` `38,085` `2,448,820` `6,043,678` `5,553,083` `1,801,800` `238,387` `192,241` `157,357` `2,180,422` `24,150` `10,147,440` `10,147,440` `$` `16,191,118`		AMOUNT `$` `636,717` `89,293` `2,452` `3,114,017` `1,494` `1,036,128` `46,324` `-` `11,063` `31,820` `15,375` `26,005` `166,342` `5,177,030` `535,587` `159,873` `1,004,829` `339,116` `55,050` `2,094,455` `7,271,485` `5,554,167` `1,801,800` `235,049` `53,719` `106,988` `1,752,584` `150,107) (` `9,354,200` `9,354,200` `$` `16,625,685`
Current liabilities 2100 Current borrowings 2130 Current contract liabilities 2150 Notes payable 2170 Accounts payable 2180 Accounts payable to related parties 2200 Other payables 2220 Other payables to related parties 2230 Current tax liabilities 2250 Current provisions 2280 Current lease liabilities 2320 Long-term liabilities, current portion 2365 Current refund liabilities 2399 Other current liabilities, others 21XX Current Liabilities Non-current liabilities 2540 Non-current portion of non- current borrowings 2580 Non-current lease liabilities 2635 Non-current preference share liabilities 2640 Net defined benefit liability, non-current 2645 Guarantee deposits received 25XX Non-current liabilities 2XXX Total Liabilities Equity attributable to owners of parent Share capital 3110 Share capital - common stock 3120 Preference share Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 31XX Equity attributable to owners of the parent 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments Significant events after the balance sheet date 3X2X Total liabilities and equity	6(12) and 8 6(21) 7 6(13) 7 6(14) and 8 6(14) and 8 6(16) 6(17)(18) 6(19) 6(20) 9 11

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

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ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars, except earnings per share amount)

(Reviewed, not audited)

Items Three months ended March 31
2023
2022
Notes
AMOUNT
%
AMOUNT
%
6(21) and 7
$
3,253,411
100
$
3,838,900
100
6(5)(10)(26)(27) and 7
(
2,932,004) (
90) (
3,187,216) (
83)
321,407
10
651,684
17
6(10)(26)(27)
(
141,173) (
4) (
189,511) (
5)
(
87,429) (
3) (
74,678) (
2)
12(2)
8,199
-
(
21,011) (
1)
(
220,403) (
7) (
285,200) (
8)
101,004
3
366,484
9
6(22)
6,618
-
970
-
6(23) and 7
20,601
1
11,003
-
6(24)
(
21,486) (
1)
80,308
2
6(25)
(
8,821)
-
(
5,748)
-
6(6)
(
167)
-
12,958
1
(
3,255)
-
99,491
3
97,749
3
465,975
12
6(28)
81,972
2
(
98,612) (
2)
$
179,721
5
$
367,363
10
6(2)
$
220,519
7
$
605
-
6(28)
-
-
1,992
-
220,519
7
2,597
-
(
4,470)
-
10,869
-
6(6)
-
-
1,746
-
6(28)
894
-
(
2,523)
-
(
3,576)
-
10,092
-
$
216,943
7
$
12,689
-
$
396,664
12
$
380,052
10
$
179,721
5
$
367,363
10
$
396,664
12
$
380,052
10
6(29)
$
0.25
$
0.52
$
0.24
$
0.50

4000
Sales revenue
5000
Operating costs
5900
Net operating margin
Operating expenses
6100
Selling and administrative expenses
6300
Research and development expenses
6450
Impairment loss (impairment gain and reversal
of impairment loss) determined in accordance
with IFRS 9
6000
Total operating expenses
6900
Operating profit
Non-operating income and expenses
7100
Interest income
7010
Other income
7020
Other gains and losses
7050
Finance costs
7060
Share of (loss) profit of associates and joint
ventures accounted for using equity method
7000
Total non-operating income and expenses
7900
Profit before income tax
7950
Income tax expense (benefit)
8200
Profit for the period
Other comprehensive income
Components of other comprehensive income
that will not be reclassified to profit or loss
8316
Unrealised gains (losses) from investments in
equity instruments measured at fair value
through other comprehensive income
8349
Income tax related to components of other
comprehensive income that will not be
reclassified to profit or loss
8310
Components of other comprehensive income
that will not be reclassified to profit or loss
Components of other comprehensive income
that will be reclassified to profit or loss
8361
Financial statements translation differences of
foreign operations
8370
Share of other comprehensive income of
associates and joint ventures accounted for
using equity method, components of other
comprehensive income that will be reclassified
to profit or loss
8399
Income tax related to components of other
comprehensive income that will be reclassified
to profit or loss
8360
Components of other comprehensive (loss)
income that will be reclassified to profit or
loss
8300
Total other comprehensive income for the
period
8500
Total comprehensive income for the period
Profit, attributable to:
8610
Owners of parent
Comprehensive income attributable to:
8710
Owners of parent
Basic earnings per share
9750
Basic
9850
Diluted

Items	Three months ended March 31 2023 2022 Notes AMOUNT % AMOUNT % 6(21) and 7 `$` `3,253,411` `100` `$` `3,838,900` `100` 6(5)(10)(26)(27) and 7 `(` `2,932,004) (` `90) (` `3,187,216) (` `83)` `321,407` `10` `651,684` `17` 6(10)(26)(27) `(` `141,173) (` `4) (` `189,511) (` `5)` `(` `87,429) (` `3) (` `74,678) (` `2)` 12(2) `8,199` `-` `(` `21,011) (` `1)` `(` `220,403) (` `7) (` `285,200) (` `8)` `101,004` `3` `366,484` `9` 6(22) `6,618` `-` `970` `-` 6(23) and 7 `20,601` `1` `11,003` `-` 6(24) `(` `21,486) (` `1)` `80,308` `2` 6(25) `(` `8,821)` `-` `(` `5,748)` `-` 6(6) `(` `167)` `-` `12,958` `1` `(` `3,255)` `-` `99,491` `3` `97,749` `3` `465,975` `12` 6(28) `81,972` `2` `(` `98,612) (` `2)` `$` `179,721` `5` `$` `367,363` `10` 6(2) `$` `220,519` `7` `$` `605` `-` 6(28) `-` `-` `1,992` `-` `220,519` `7` `2,597` `-` `(` `4,470)` `-` `10,869` `-` 6(6) `-` `-` `1,746` `-` 6(28) `894` `-` `(` `2,523)` `-` `(` `3,576)` `-` `10,092` `-` `$` `216,943` `7` `$` `12,689` `-` `$` `396,664` `12` `$` `380,052` `10` `$` `179,721` `5` `$` `367,363` `10` `$` `396,664` `12` `$` `380,052` `10` 6(29) `$` `0.25` `$` `0.52` `$` `0.24` `$` `0.50`
4000 Sales revenue 5000 Operating costs 5900 Net operating margin Operating expenses 6100 Selling and administrative expenses 6300 Research and development expenses 6450 Impairment loss (impairment gain and reversal of impairment loss) determined in accordance with IFRS 9 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7060 Share of (loss) profit of associates and joint ventures accounted for using equity method 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense (benefit) 8200 Profit for the period Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 8316 Unrealised gains (losses) from investments in equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8310 Components of other comprehensive income that will not be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8361 Financial statements translation differences of foreign operations 8370 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss 8360 Components of other comprehensive (loss) income that will be reclassified to profit or loss 8300 Total other comprehensive income for the period 8500 Total comprehensive income for the period Profit, attributable to: 8610 Owners of parent Comprehensive income attributable to: 8710 Owners of parent Basic earnings per share 9750 Basic 9850 Diluted

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

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ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars

(UNAUDITED)

Three months ended March 31, 2022

Balance at January 1, 2022 Profit for the period Other comprehensive income Total comprehensive income Share-based payment transactions Balance at March 31, 2022 Three months ended March 31, 2023 Balance at January 1, 2023 Profit for the period

Other comprehensive (loss) income Total comprehensive income (loss) Share-based payment transactions Balance at March 31, 2023

Notes						Equityat	Equityat	butable to owners	of theparent				Total equity
		Share	capital		Capitial surplus			Retained earnings			Other equity interest
		Ordinaryshare		Preference share		Legal reserve		Special reserve	Unappropriated retained earnings	Exchange differences on translation of foreign financial statements	Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income	Unearned compensation
6(17) 6(17)	`$ 5,554,319` `-` `-` `-` `(` `152 )` `$ 5,554,167` `$ 5,553,299` `-` `-` `-` `(` `216 )` `$ 5,553,083`			`$ 1,801,800` `-` `-` `-` `-` `$ 1,801,800` `$ 1,801,800` `-` `-` `-` `-` `$ 1,801,800`	`$` `234,897` `-` `-` `-` `152` `$` `235,049` `$` `238,171` `-` `-` `-` `216` `$` `238,387`		`$ 53,719` `-` `-` `-` `-` `$ 53,719` `$ 192,241` `-` `-` `-` `-` `$ 192,241`	`$ 106,988` `-` `-` `-` `-` `$ 106,988` `$ 157,357` `-` `-` `-` `-` `$ 157,357`	`$ 1,385,221` `367,363` `-` `367,363` `-` `$ 1,752,584` `$ 2,000,701` `179,721` `-` `179,721` `-` `$ 2,180,422`	`($` `41,911` `)` `-` `10,092` `10,092` `-` `($` `31,819` `)` `($` `11,936` `)` `-` `(` `3,576` `)` `(` `3,576` `)` `-` `($` `15,512` `)`	`($` `115,445 )` `-` `2,597` `2,597` `-` `($` `112,848 )` `($` `180,857 )` `-` `220,519` `220,519` `-` `$` `39,662`	`($` `7,523 )` `-` `-` `-` `2,083` `($` `5,440 )` `$` `-` `-` `-` `-` `-` `$` `-`	`$ 8,972,065` `367,363` `12,689` `380,052` `2,083` `$ 9,354,200` `$ 9,750,776` `179,721` `216,943` `396,664` `-` `$ 10,147,440`

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

~7~

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars)

(Reviewed, not audited)

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

Amortization expense

(Gain) loss on expected credit impairment

Losses on financial assets at fair value through profit or loss
Interest expense

Interest income

Compensation cost of share-based payments

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

Gain on disposal of non-current assets held for sale

Gain on disposal of property, plant and equipment

Scrapping inventory and loss on decline in market value

Gain arising from lease modifications
Changes in operating assets and liabilities
Changes in operating assets
Decrease in contract assets
Decrease in notes receivable
Decrease in accounts receivable
Decrease in accounts receivable due from related parties
Decrease in other receiables
Decrease in other receivables due from related parties
Decrease (increase) in inventories
Decrease in prepayments
Increase in other current assets, others
Decrease in other non-current assets, others
Changes in operating liabilities
(Decrease) increase in contract liabilities
Decrease in accounts payable
Decrease in accounts payable to related parties
Decrease in other payables
Increase in other payables to related parties
(Decrease) increase in current provisions
Increase in other current liabilities
Decrease in net defined benefit liability
Cash (outflow) inflow generated from operations
Interest received
Net cash flows (used in) from operating activities Three months ended March 31
Notes
2023
2022
$
97,749 $
465,975
6(7)(8)(26)
257,775
291,863
6(10)(26)
10,715
7,412
12(2)
(
8,199 )
21,011
6(24)
-
1,261
6(25)
8,821
5,748
6(22)
(
6,618 ) (
970 )
6(17)
-
2,083
6(6)
167 (
12,958 )
6(24)
- (
54,271 )
6(24)
(
214 ) (
5,771 )
6(5)
138,192
3,701
- (
1,772 )
28,824
10,146
52
146
30,305
108,168
15,404
153,297
5,339
17,600
-
51,658
155,709 (
32,304 )
1,035
2,961
(
1,207 ) (
59 )
-
598
(
1,612 )
293
(
561,575 ) (
112,260 )
(
728 ) (
9,653 )
(
403,399 ) (
377,742 )
-
406
(
57 )
707
9,572
1,564
(
50,813 ) (
148,084 )
(
274,763 )
390,754
6,167
888
(
268,596 )
391,642

(Continued)

~8~

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars)

(Reviewed, not audited)

CASH FLOWS FROM INVESTING ACTIVITIES
Increase in non-current financial assets at fair value through other
comprehensive income
Decrease in current financial assets at amortised cost
Acquistion of property, plant and equipment (including
prepayment for equipment)

Proceeds from disposal of non-current assets held for sale
Proceeds from disposal of property, plant and equipment
Decrease in refundable deposits
Acquistion of intangible assets

Decrease in long-term accounts receivable due from related
parties
Increase in other non-current assets, others
Net cash flows used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in short-term borrowings
Decrease in short-term borrowings
Decrease in short-term notes and bills payable
Proceeds from long-term borrowings
Repayments of long-term borrowings
Decrease in guarantee deposits received

Payments of lease liabilities

Interest paid
Net cash flows (used in) from financing activities
Effect of exchange rate changes on cash and cash equivalents
Net (decrease) increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period Three months ended March 31
Notes
2023
2022
( $
70,053 ) ( $
160,327 )
-
11,465
6(30)
(
258,665 ) (
494,302 )
-
412,744
208
6,756
642
20,024
6(10)
(
42,416 ) (
7,645 )
-
87,383
(
112 )
-
(
370,396 ) (
123,902 )
-
806,717
- (
469,577 )
- (
50,000 )
-
205,262
- (
302,694 )
6(31)
(
1,791 ) (
1,972 )
6(31)
(
6,953 ) (
9,074 )
(
4,129 ) (
2,961 )
(
12,873 )
175,701
(
1,776 )
7,587
(
653,641 )
451,028
3,945,818
2,723,171
$
3,292,177 $
3,174,199

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

~9~

ORIENT SEMICONDUCTOR ELECTRONICS LIMITED AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS, EXCEPT AS OTHERWISE INDICATED) (REVIEWED, NOT AUDITED)

1. History and Organisation

(1) Orient Semiconductor Electronics Limited (the “Company”) was incorporated in Kaohsiung City in June 1971 under the provisions of the Company Act of the Republic of China (R.O.C.). The address of the Company’s registered office is at No. 9, Central 3rd Street, Nanzih District, Kaohsiung City. The Company and its subsidiaries (collectively referred herein as the “Group”), were primarily engaged in various types of integrated circuits, semiconductor components, computer motherboards, various types of electronic inventory, manufacturing, combination, processing and export of computer and communication circuit boards.
(2) The Company was listed on the Taiwan Stock Exchange starting from April 1994.
The Date of Authorisation for Issuance of the Financial Statements and Procedures for Authorisation
These financial statements were authorised for issuance by the Board of Directors on April 26, 2023.

3. Application of New Standards, Amendments and Interpretations

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

New standards, interpretations and amendments endorsed by FSC and became effective from 2023 are as follows:

New Standards,Interpretations andAmendments	Effective date by International Accounting StandardsBoard
Amendments to IAS 1, ‘Disclosure of accounting policies’ Amendments to IAS 8, ‘Definition of accounting estimates’ Amendments to IAS 12, ‘Deferred tax related to assets and liabilities arising from a single transaction’	January 1, 2023 January 1, 2023 January 1, 2023

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

(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by

the Group

None.

~10~

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

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

==> picture [469 x 47] intentionally omitted <==

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

Effective date by
International Accounting
New Standards, Interpretations and Amendments Standards Board
----- End of picture text -----

New Standards,Interpretations andAmendments	Effective date by International Accounting StandardsBoard
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets	To be determined by
between an investor and its associate or joint venture’	International Accounting
	Standards Board
Amendments to IFRS 16, ‘Lease liability in a sale and leaseback’	January 1, 2024
IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IFRS 17, 'Insurance contracts'	January 1, 2023
Amendment to IFRS 17, 'Initial application of IFRS 17 and IFRS 9 –	January 1, 2023
comparative information'
Amendments to IAS 1, ‘Classification of liabilities as current or non-	January 1, 2024
current’
Amendments to IAS 1, ‘Non-current liabilities with covenants’	January 1, 2024

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

4. Summary of Significant Accounting Policies

The principal accounting policies adopted are consistent with Note 4 in the consolidated financial statements for the year ended December 31, 2022, except for the compliance statement, basis of preparation, basis of consolidation and additional policies as set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(1) Compliance statement

A. The consolidated financial statements of the Group have been prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the International Accounting Standard 34, ‘Interim financial reporting’ that came into effect as endorsed by the FSC.
B. These consolidated financial statements are to be read in conjunction with the consolidated financial statements for the year ended December 31, 2022.

(2) Basis of preparation

A. Except for the following items, the consolidated financial statements have been prepared under the historical cost convention:
(a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.
(b) Financial assets at fair value through other comprehensive income financial assets measured at fair value.

~11~

(c) Defined benefit liabilities recognised based on the net amount of pension fund assets less present value of defined benefit obligation.
B. The preparation of financial statements in conformity with International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations that came into effect as endorsed by the FSC (collectively referred herein as the “ IFRSs ” ) requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

(3) Basis of consolidation

A. Basis for preparation of consolidated financial statements:

The basis for preparation of consolidated financial statements are consistent with those of the year ended December 31, 2022.

B. Subsidiaries included in the consolidated financial statements:

Investor	Name ofsubsidiary	Mainbusiness activities		Ownership(%)	March 31, 2022 93.67% 100% 100% 100% 6.33% 100%	Description
			March 31, 2023 93.67% 100% 100% 100% 6.33% 100%	December 31, 2022 93.67% 100% 100% 100% 6.33% 100%
Orient Semiconductor Electronics Limited Orient Semiconductor Electronics Limited Electronics Limited Orient Semiconductor Electronics Limited Orient Semiconductor Electronics Limited OSE International Limited Corplus (HK) Limited	OSE Philippines INC. (“OSEP”) OSE International Limited (“OSE BVI”). Coreplus (HK) Limited (“COREPLUS”) Hua-Cheng Investment Co. (“Hua-Cheng”) OSE Philippines INC. (“OSEP”) Value–Plus Technology (Suzhou) Co. (Value–Plus (Suzhou))	(a) Integrated circuit and semiconductor components. (b) Research, design, manufacture, assembly, processing, test and after-sales service of aforementioned products. Investments in various production business. North America. Accepted orders, purchased materials and outsourcing processing of components combination business. Reinvestments in various business. (a) Integrated circuit and semiconductor components. (b) Research, design, manufacture, assembly, processing, test and after-sales service of aforementioned products. Adhesive processing, plug-in welding processing and related test, combination processing, technique maintenance and after-sale service of the surface of base plate of electronic components				Notes 1 and 2 - Note 3 Note 4 Notes 1 and 2 Note 3

Note 1: The Company directly held 93.67% of equity interest of OSEP, plus the equity of 6.33% held by the Company’s subsidiary (OSE BVI), the equity held in total was 99.99%.

Note 2: OSEP has stopped operation in the fourth quarter of 2011. The liquidation has been started after the resolution of the Board of Directors on April 30, 2022.

~12~

Note 3: The financial statements of the entity as of and for the three months ended March 31, 2023 and 2022 were not reviewed by the independent auditors as the entity did not meet the definition of a significant subsidiary.
Note 4: The financial statements of the entity as of and for the three months ended March 31, 2022 were not reviewed by the independent auditors as the financial component entity is not material to the Group.
C. Subsidiaries not included in the consolidated financial statements: None.
D. Adjustments for subsidiaries with different balance sheet dates: None.
E. Significant restrictions: None.
F. Subsidiaries that have non-controlling interests that are material to the Group: None.

(4) Employee benefits

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

(5) Income taxes

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

5. Critical Accounting Judgements, Estimates and Key Sources of Assumption Uncertainty

There have been no significant changes as of March 31, 2023. Please refer to Note 5 in the consolidated financial statements for the year ended December 31, 2022.

6. Details of Significant Accounts

(1) Cash and cash equivalents

tails of Significant Accounts Cash and cash equivalents
Cash on hand and petty cash Checking accounts and demand deposits Time deposits	March31,2023 195 $ 2,391,982 900,000 3,292,177 $	December31,2022 189 $ 3,356,169 589,460 3,945,818 $	March31,2022
			199 $ 2,474,000 700,000
			3,174,199 $

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

~13~

B. The Group’s demand deposits and time deposits which were provided as collaterals or were restricted due to the foreign capital remitted back in Taiwan and deposited in special account of －
bank have been transferred to “financial assets at amortised cost current”, please refer to Note 6(3) for details.
C. Aforementioned time deposits had maturities not exceeding three months and were not pledged as collateral, and were classified as cash equivalents according to its nature.

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

Items Non-current items: Unlisted stocks Listed stocks	March31,2023 December 31, 2022 10,613 $ 10,613 $ 1,301,385 1,010,814 1,311,998 $ 1,021,427 $	March 31, 2022
		29,921 $ 445,695
		475,616 $

A. The Group has elected to classify equity investments that are considered to be strategic investments as financial assets at fair value through other comprehensive income. The fair value of such investments amounted to $1,311,998, $1,021,427 and $475,616 as at March 31, 2023, December 31, 2022 and March 31, 2022, respectively.
B. For the three months ended March 31, 2023 and 2022, the Group has financial assets at fair value through other comprehensive income recognised in comprehensive (loss) income due to changes of fair value in the amounts of $220,519 and $605, respectively.
C. The Group has no financial assets at fair value through other comprehensive income pledged to others as collateral.

(3) Financial assets at amortised cost

Items March 31, 2023 December 31, 2022 March 31, 2022

==> picture [476 x 48] intentionally omitted <==

A. For the three months ended March 31, 2023 and 2022, the interest income from time deposits was recognised under interest income from bank deposits, please refer to Note 6(22).
B. The Group has no financial assets at amortised cost pledged to others as collateral.
C. Information relating to credit risk of financial assets at amortised cost is provided in Note 12(2). The counterparties of the Group’s investments in certificates of deposit are financial institutions with high credit quality, so the Group expects that the probability of counterparty default is remote.

~14~

(4) Notes and accounts receivable (including related parties)

		March31,2023	March31,2023	December31,2022	December31,2022	December31,2022		March31,2022	March31,2022
Notes receivable		$	103		$	155		$	-
Less: Loss allowance			-			-			-
		$	103		$	155		$	-
Accounts receivable		$	2,989,343		$	3,035,158		$	2,792,014
Less: Loss allowance	(		4,875)	(		13,071)	(		26,535)
		$	2,984,468		$	3,022,087		$	2,765,479

Accounts receivable due from related		$	76		$	399		$	305,112
parties
Less: Loss allowance			-			-			-
		$	76		$	399		$	305,112

A. For details of the aging analysis of notes and accounts receivable which were based on the dates past due and information relating to credit risk, please refer to Note 12(2).
B. As of March 31, 2023, December 31, 2022 and March 31, 2022, accounts and notes receivable were all from contracts with customers. As of January 1, 2022, the balance of receivables from contracts with customers amounted to $3,356,874.
C. The Group has no notes and accounts receivable pledged to others as collateral.
D. As at March 31, 2023, December 31, 2022 and March 31, 2022, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the Group’s notes receivable was $103, $155 and $0 as at March 31, 2023, December 31, 2022 and March 31, 2022, the maximum exposure to credit risk in respect of the amount that best represents the Group’s accounts receivable was $2,984,544, $3,022,486 and $3,070,591, respectively.

(5) Inventories

Inventories
		March31,2023		December31,2022			March31,2022
Raw materials		$	1,463,921	$	1,585,642		$	1,672,682
Supplies			150,294		157,344			157,481
Work in progress			258,491		315,903			251,084
Finished goods			69,068		40,867			52,595
			1,941,774		2,099,756			2,133,842
Less: Allowance for valuation loss	(		419,861)	(	281,728)	(		273,034)
		$	1,521,913	$	1,818,028		$	1,860,808

~15~

A. The cost of inventories recognised as expense for the period:

			Threemonths ended	Threemonths ended	Threemonths ended	March31
			2023			2022
Cost of goods sold		$	2,796,413		$	3,188,860
Scrapping inventory and loss on decline in market value			138,192			3,701
Others	(		2,601)	(		5,345)
		$	2,932,004		$	3,187,216

B. As of March 31, 2023, December 31, 2022 and March 31, 2022, the fire insurance amount of inventories were $15,290,330, $15,234,807 and $14,074,935, respectively.

(6) Investments accounted for using equity method

Investments accounted for using equity method
At January 1 Share of profit or loss of investments accounted for using equity method Changes in other equity interest At March 31 Amount Shareholding ratio Associates: OSE PROPERTIES, INC. 1,704 $ 39.99% ATP ELECTRONICS, TAIWAN INC. - - SCS HIGHTECH INC. - 18.71% 1,704 $ March 31,2023	2023 2022 1,843 $ 467,174 $ 167) ( 12,958 28 630 1,704 $ 480,762 $ Amount Shareholding ratio Amount Shareholding ratio 1,843 $ 39.99% 6,660 $ 39.99% - - 474,102 18.31% - 18.71% - 18.71% 1,843 $ 480,762 $ December 31,2022 March 31,2022		2022 467,174 $ 12,958 630 480,762 $ March 31,2022
		Amount Shareholding ratio 6,660 $ 39.99% 474,102 18.31% - 18.71% 480,762 $

A. The carrying amount of the Group’s investment in SCS HIGHTECH, INC. has been recognised as zero, and there is no further legal or constructive obligation to accrue additional losses. The company has been approved to nullify the registration in 2004 and is still pending liquidation.
B. As of March 31, 2023, December 31, 2022 and March 31, 2022, there was no investments accounted for using equity method pledged as collaterals.
C. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Group had no significant associate.
D. The Group’s share of the operating results in all individually immaterial associates is summarized below:

(Loss) profit Total comprehensive (loss) income for the period Other comprehensive income, net of tax	2023 2022 167) ($ 12,958 $ - 1,746 167) ($ 14,704 $ Three months ended March31	Three months ended March31	Three months ended March31
			2022
			12,958 $ 1,746
			14,704 $

~16~

E. For the three months ended March 31, 2023 and 2022, the Group’s investees accounted for using equity method were valued from investees’ financial statements which were reviewed by auditors in the same period.

(7) Property, plant and equipment

in the same period. Property, plant and equipment
Property, plant and equipment - Owner-occupied - Operating leases	March31,2023 5,127,499 $ 797 5,128,296 $	December31,2022 5,219,945 $ 830 5,220,775 $	March31,2022
			5,446,740 $ 930
			5,447,670 $

~17~

A.Property, plant and equipment for self-use

Cost and revaluation increment: January 1, 2023 Additions Disposals Transfers Impact of changes in foreign exchange rate March 31, 2023 Depreciation and impairment: January 1, 2023 Depreciation expense Disposals Impact of changes in foreign exchange rate March 31, 2023	Buildings and Machinery and structures equipment 7,083,750 $ 15,393,819 $ - - - 10,121) ( 75,368 252,727 - 842 7,159,118 $ 15,637,267 $ 4,920,862 $ 13,051,014 $ 35,185 212,246 - 10,121) ( - 566 4,956,047 $ 13,253,705 $	Transportation Office Other Construction in progress and equipment equipment equipment equipment under installation Total 3,188 $ 58,341 $ 418,410 $ 645,318 $ 23,602,826 $ - - - 156,021 156,021 - 17) ( 63) ( - 10,201) ( - - 2,411 326,762) ( 3,744 16 21 91 - 970 3,204 $ 58,345 $ 420,849 $ 474,577 $ 23,753,360 $ 2,937 $ 58,009 $ 350,059 $ - $ 18,382,881 $ - 5 5,067 - 252,503 - 15) ( 57) ( - 10,193) ( 14 20 70 - 670 2,951 $ 58,019 $ 355,139 $ - $ 18,625,861 $

~18~

Cost and revaluation increment: January 1, 2022 (Note) Additions Disposals Transfers Impact of changes in foreign exchange rate March 31, 2022 Depreciation and impairment: January 1, 2022 (Note) Depreciation expense Disposals Transfers Impact of changes in foreign exchange rate March 31, 2022 Carrying amount, net: March 31, 2023 December 31, 2022 March 31, 2022	Buildings and Machinery and structures equipment 7,031,115 $ 14,745,469 $ - 18 - 214,475) ( 33,165 410,324 - 9,665 7,064,280 $ 14,951,001 $ 4,809,885 $ 12,524,278 $ 33,264 248,274 - 213,490) ( - - - 7,767 4,843,149 $ 12,566,829 $ 2,203,071 $ 2,383,562 $ 2,162,888 $ 2,342,805 $ 2,221,131 $ 2,384,172 $	Transportation Office Other Construction in progress and equipment equipment equipment equipment under installation Total 4,187 $ 59,325 $ 376,097 $ 927,623 $ 23,143,816 $ - - - 325,139 325,157 - 946) ( 3) ( - 215,424) ( - - 4,751 446,095) ( 2,145 120 184 688 21 10,678 4,307 $ 58,563 $ 381,533 $ 806,688 $ 23,266,372 $ 3,930 $ 58,965 $ 344,036 $ - $ 17,741,094 $ 3 4 2,846 - 284,391 - 946) ( 3) ( - 214,439) ( - - - - - 111 171 537 - 8,586 4,044 $ 58,194 $ 347,416 $ - $ 17,819,632 $ 253 $ 326 $ 65,710 $ 474,577 $ 5,127,499 $ 251 $ 332 $ 68,351 $ 645,318 $ 5,219,945 $ 263 $ 369 $ 34,117 $ 806,688 $ 5,446,740 $	Total
	$
	$
	$
	$		17,819,632 $ 5,127,499 $
	$
	$		5,219,945 $
	$		5,446,740 $

Note: In July 2021, the Group transferred part of buildings and structures held for its own use to non-current assets held for sale, and the related cost and accumulated depreciation amounted to $124,639 and $123,359, respectively. Information relating to non-current assets held for sale is provided in Note 6(11).

~19~

B. Property, plant and equipment for operating lease

Cost and revaluation increment: January 1 and March 31, 2023 January 1, 2023 Depreciation March 31, 2023 Cost and revaluation increment: January 1 and March 31, 2022 (Note) January 1, 2022 (Note) Depreciation March 31, 2022 Carrying amount, net: March 31, 2023 December 31, 2022 March 31, 2022 Depreciation and impairment: Depreciation and impairment:	Buildings and structures 10,721 $ 9,891 $ 33 9,924 $ 10,721 $ 9,758 $ 33 9,791 $ 797 $ 830 $ 930 $	Machineryand equipment - $ - $ - - $ - $ - $ - - $ - $ - $ - $	Total 10,721 $ 9,891 $ 33 9,924 $
			10,721 $
			9,758 $ 33
			9,791 $
			797 $
			830 $
			930 $

Note: In July 2021, the Group transferred part of buildings and structures held for operating leases to non-current assets held for sale, and the related cost and accumulated depreciation amounted $268,621 and $133,764, respectively. Information relating to non-current assets held for sale is provided in Note 6(11).
C. Amount of borrowing costs capitalised as part of property, plant and equipment and the range of the interest rates for such capitalisation are as follows:

Amount capitalised Range of the interest rates for capitalisation	Three months ended March 31	Three months ended March 31
	2023 - $ -	2022
		1,995 $
		0.98%～1.02%

D. The significant components of buildings and equipment include main plants and each improvement construction, which are depreciated over 30~51 and 3~21 years, respectively.
E. As of March 31, 2023, December 31, 2022 and March 31, 2022, the insured amount of fire insurance of property, plant and equipment were $10,152,657, $10,151,541 and $10,272,868, respectively.
F. Refer to Note 8 for further information on property, plant and equipment pledged to others as collateral.
－
(8) Leasing arrangements lessee
A. The Group leased various assets, including property (land, building and structures), machinery and equipment and transportation equipment. The lease period of each contract was between 3 to 51 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants, but leased assets may not be subleased, sublet, subtenant to others, transfer the lease right to others and pledged as collaterals.

~20~

B. The carrying amount of right-of-use assets and the depreciation charge are as follows:

March31,2023 Carrying amount Land 122,393 $ Buildings and structures - Mechinery and equipment 32,266 Transportation equipment 6,858 161,517 $ Land Buildings and structures Mechinery and equipment Transportation equipment	December31,2021 March31,2022 Carrying amount Carrying amount 125,250 $ 145,749 $ - 4,075 33,711 38,045 7,794 3,903 166,755 $ 191,772 $ 2023 2022 Depreciationexpense Depreciationexpense 2,858 $ 3,233 $ - 1,724 1,445 1,445 936 1,019 5,239 $ 7,421 $ Three months ended March 31	December31,2021 March31,2022 Carrying amount Carrying amount 125,250 $ 145,749 $ - 4,075 33,711 38,045 7,794 3,903 166,755 $ 191,772 $ 2023 2022 Depreciationexpense Depreciationexpense 2,858 $ 3,233 $ - 1,724 1,445 1,445 936 1,019 5,239 $ 7,421 $ Three months ended March 31
		7,421

C. For the three months ended March 31, 2023 and 2022, the additions right-of-use assets were both $0.
D. Information on profit or loss in relation to lease contracts is as follows:

==> picture [457 x 34] intentionally omitted <==

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

Three months ended March 31
Items affecting profit or loss 2023 2022
----- End of picture text -----

Items affecting profit or loss		2023		2022
Interest expense on lease liabilities	$	689	$	856
Expense on short-term lease contracts		4,156		1,196
Expense on leases of low-value assets		606		822
(Excluding expense on leases of low-value assets
of short-term lease)
Gains arising from lease modifications		-		1,772
(Shown as ‘other income and expenses - net’)

E. For the three months ended March 31, 2023 and 2022, the total amount of the Group’s cash outflow from leasing were $12,404 and $11,948, respectively.
F. In March 2022, the Company's subsidiary, OSEP, disposed the plant which had ceased operation in the Philippines and terminated the land lease agreement, where the original plant is located. The related derecognised right-of-use assets and the gain arising from lease modification amounted to $62,306 and $1,894, respectively.

(9) Leasing arrangements - lessor

A. The Group leases various assets including plant and office. Rental contracts are typically made for periods of 2 and 10 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. To secure the use of the leased assets, the leased assets may not be subleased, transferred or provided to others in other ways.

~21~

B. Gain arising from operating lease agreements are as follows:

			Three months ended	Three months ended	Three months ended	March 31
			2023			2022
Related revenue from fixed lease payments		$		1,639 $		1,987
C. The maturity analysis of the lease	payments under the operating leases is as follows:
	March31,2023		December	31,2022	March31,2022
Within 1 year	$	5,088	$	5,124	$	6,223
Later than one year but not later		2,856		3,919		4,254
than two years
Later than two years but not later		722		729		2,127
than three years
Later than three years but not later		703		703		-
than four years
Later than four years but not later		703		703		-
than five years
Later than five years		2,753		2,929		-
	$	12,825	$	14,107	$	12,604

D. For disclosures of property, plant and equipment leased in operating lease and applied to IAS 16, please refer to Note 6(7).

(10) Intangible assets

16, please refer to Note 6(7). Intangible assets
2023 Cost At January 1 481,650 $ Additions`－`acquired separately 42,416 Reclassifications 5) ( Net exchange differences 3 At March 31 524,064 $ Accumulated amortisation At January 1 434,103 $ Amortisation charge 10,715 Net exchange differences - At March 31 444,818 $ Book value 79,246 $ Computer	Computer	software
		2022
		440,354 $ 7,645 - 20
		448,019 $
		407,382 $ 7,412 -
		414,794 $
		33,225 $

~22~

A. Details of amortisation on intangible assets are as follows:

Operating costs Selling and administrative expenses Research and development expenses	2023 2022 4,771 $ 4,774 $ 4,625 $ 1,064 $ 1,319 $ 1,574 $ Three months ended March31

B. There was no intangible asset held by the Group that was pledged to others.
(11) Non-current assets held for sale
A. The assets related to certain plants located in Kaohsiung Nanzih Technology Industrial Park have been reclassified as disposal group held for sale following the approval of the Group’s Board of Directors to sell the plants in cooperation with the Land Redevelopment Project of Technology Industrial Park Administration. The transaction and ownership transfer are expected be completed within a year. As of and December 31, 2021, the assets of disposal group held for sale amounted to both $136,137, and there were no related liabilities. The Company collected the full amount of the consideration for the sale of the plant in July 2022 and completed the related procedures.
B. No impairment loss was incurred as a result of the remeasurement of the aforementioned disposal group held for sale at the lower of its carrying amount or fair value less costs to sell.
(12) Short-term borrowings

Short-term borrowings
Borrowings to purchase materials Unsecured borrowings Interest rate range	March31,2023 - $ - - $ -	December31,2022 - $ - - $ -	March31,2022
			129,717 $ 507,000
			636,717 $
			0.78%~1.50%

For the three months ended March 31, 2023 and 2022, the amounts of interest expense recognised in profit or loss were $0 and $1,012, respectively.

A. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Group’s total unused amounts of short-term borrowings was $4,265,246, $4,274,122 and $3,148,183, respectively.
B. Information about the assets that were pledged for short-term borrowings as collateral is provided in Note 8.

~23~

(13) Other payables

Other payables
March31,2023 Salary and bonus payable 144,317 $ Pension payable 37,939 Employees’ compensation and 209,025 directors’ remuneration payable Payables for machinery and 231,555 equipment Utilities expense payable 35,782 Compensation payable 8,193 Insurance premiums payable 71,308 Employment Stability Fund payable 14,842 Other payables 81,496 834,457 $	December31,2022 504,618 $ 38,321 221,996 303,918 34,418 17,193 78,454 15,125 85,522 1,299,565 $	March31,2022 135,528 $ 37,896 294,797 339,752 32,639 12,232 69,941 13,815 99,528
		1,036,128 $

- (14) Long term borrowings

Type of Borrowings	Borrowing period andrepayment term	March31,2023
Long-term bank borrowings Unsecured borrowings Type of Borrowings Less: Current portion	Borrowing period is from August 2021 to March 2029; interest is payable monthly; principal is repayable at maturity. Borrowing period andrepayment term	1,148,962 $ 2,904) (
		1,146,058 $
		December31,2022
Long-term bank borrowings Unsecured borrowings Type of Borrowings Less: Current portion	Borrowing period is from August 2021 to March 2029; interest is payable monthly; principal is repayable at maturity Borrowing period andrepayment term	1,148,962 $ -
		1,148,962 $
		March31,2022
Long-term bank borrowings Unsecured borrowings Secured borrowings Less: Current portion	Borrowing period is from August 2021 to September 2028; interest is payable monthly; principal is repayable at maturity Borrowing period is from December 2021 to December 2024; interest is payable monthly; principal is repayable at maturity (Note 2)	490,962 $ 60,000
		550,962 15,375) (
		535,587 $

~24~

Note 1: Some of the Group’s loans were granted in accordance with the ‘Guidelines of Project Loans for Returning Overseas Taiwanese Businesses’ of National Development Fund, Executive Yuan. The interest rate of the loans for the first 5 years is the floating interest rate on a 2- year time deposit offered by the Directorate General of the Postal Remittances and Savings Bank less 0.245% of annual interest. In the event of failure to meet the requirements of the aforementioned Guidelines of Project Loans during the loan period, the interest rate will be changed to the floating interest rate on a 2-year time deposit offered by the Directorate General of the Postal Remittances and Savings Bank plus 0.255% of annual interest.
Note 2: The Group made early repayments on the secured loans from banks in September 2022.
A. For the three months ended March 31, 2023 and 2022, the amounts of interest expense recognised in profit or loss were $3,518 and $1,248, respectively.
B. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Group’s total unused amounts of long-term borrowings was $2,720,000, $3,459,038 and $4,117,038, respectively.
C. Information about the assets that were pledged for long-term borrowings as collateral is provided in Note 8.

(15) Pensions

A.(a) The Company has a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. For the Company’s domestic employees who are applicable to the Labor Pension Act, the Company and its domestic subsidiaries contribute monthly an amount equal to 10% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. Also, the Company would assess the balance in the aforementioned labor pension reserve account by December 31, every year. If the account balance is insufficient to pay the pension calculated by the aforementioned method to the employees expected to qualify for retirement in the following year, the Company will make contributions for the deficit by next March.
(b) For the three months ended March 31, 2023 and 2022, the Company recognised pension costs in the amounts of $1,763 and $2,328, respectively.
(c) The Company expects to pay contributions for the pension plan in the amount of $53,933 in the future one year.

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B.(a) Effective July 1, 2005, the Company has established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company and its domestic subsidianies contributes monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.
(b) The Company’s mainland China subsidiary, Value–Plus Technology (Suzhou) Co. (Value–Plus (Suzhou)), has a defined contribution plan. Monthly contributions to an independent fund administered by the government in accordance with the pension regulations in the People’s Republic of China (PRC) are based on certain percentage of employees’ monthly salaries and wages. Other than the monthly contributions, the Company has no further obligations. Other foreign subsidiaries contributed to related pension management plans according to local regulations.
(c) The pension costs under the defined contribution pension plan of the Comapny for the three months ended March 31, 2023 and 2022 were $37,076 and $31,435, respectively.

(16) Preference share liability

Preference share liability
Class B preferred shares Less: Maturity within one year	March31,2023 1,003,532 $ - 1,003,532 $	December31,2022 March 31, 2022 1,003,851 $ 1,004,829 $ - - 1,003,851 $ 1,004,829 $
	$	$
	$	$

A. On December 3, 2020, the Company’s shareholders held an extraordinary general meeting and approved the private placement of class B preferred shares in the amount of 90,090 thousand shares. The subscriber, Chipbond Technology Corporation (Chipbond) has completed the payment on December 16, 2020, with a total amount of $999,999 at $11.1 per share. The effectived date was set on December 21, 2020. According to the issuance condition of class B preferred shares, the issuance period was 5 years and there was an obligation to pay cash or transfer another financial asset to the counterparty (holder). Thus, the value of the preference share was split into preference share liabilities and call options (shown as financial assets at fair value through profit or loss) in the amounts of $1,006,485 and $6,486, respectively. For the three months ended March 31, 2023 and 2022, the amount of interest expense which was estimated by annual rate and amortised based on interest method was $4,612 and $4,612, respectively.
B. As of March 31, 2023, December 31, 2022 and March 31, 2022, the value of preference share returned all amounted to $0. Refer to Note 6(24) for details of net gains (losses) recognised in profit or loss in relation to financial assets at fair value through profit or loss. Additionally, the Group has no financial assets at fair value through profit or loss pledged to others as collateral.

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C. The issuance conditions were as follows:
(a) The distribution of earnings was based on the Company’s Articles of Incorporation, current year or current quarter and accumulated undistributable dividend shall be appropriated to class B preferred shares in the first priority. If there was no earning or earnings were not sufficient to be appropriated to class B preferred shares, the distributable earnings shall be appropriated to class B preferred shares. The insufficient dividend shall first then be appropriated in a profitable year or quarter afterward.
(b) The annual dividend rate of class B preferred shares was 2% which were calculated at the issuance price per share and paid in cash, the ex-dividend date of preferred dividend was authorised to be determined by the Board of Directors. The issuance number in issuance year or quarter and recovered year or quarter were calculated at the actual issuance number of days.
(c) If the expected dividend distribution amount of common share exceeds the dividend amount of class B preferred shares in the current year or quarter, the shareholders of class B preferred shares cannot participate in the distribution.
(d) Except for aforementioned dividend, the shareholders of class B preferred shares cannot participate in the appropriation of earnings and reserves to shareholders of common share and other types of preference shares.
(e) Class B preferred shares were not promised to be transferred to common share.
(f) The shareholders of class B preferred shares have no voting right in the common shareholders’ meeting and cannot be elected as directors (including independent directors). However, the shareholders of class B preferred shares has voting right in preferred shareholders’ meeting and matters of preferred shareholders’ right.
(g) When it comes to appropriate residual assets of company, class B preferred shares have priority over common shares and class C preferred shares. However, the amount was limited to the issuance price plus total amount of unpaid dividend.
(h) The issuance period of class B preferred shares was 5 years, shareholders of class B preferred shares did not have right to demand the Company call back class B preferred shares. However, on the date after 3 years of the issuance date, the Company can call back all or some of class B preferred shares at actual issuance price in cash or other ways which were permitted by regulations. The rights and obligations of class B preferred shares which have not been called will continue until the Company calls back. In the current year of calling back the class B preferred shares, if the Company’s shareholders resolve to appropriate dividends, the amount of dividends which have to be distributed as of the date of call back will be calculated according to the number of actual issuance days in the current year.
(i) The preemptive rights for stockholders of class B preferred shares are the same as of common stocks when the Company increases its capital by issuing shares.

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  - (j) When class B preferred shares meet the condition of called back or mature in the issuance period, if the Company cannot call back all or some class B preferred shares due to force majeure or inscrutable fault of the Company, the rights of class B preferred shares which have not been called back will continue according to aforementioned issuance conditions until the Company calls back all the class B preferred shares. The dividends will be calculated according to original annual rate and actual extension period, the rights of class B preferred shares shall not be diminished according to the Company’s Articles of Incorporation.

  - (k) Class B preferred shares will not be listed in the issuance period.

(17) Share-based payment
A. For the three months ended March 31, 2023: There were no such transactions.
B. For the three months ended March 31, 2022, the Group’s share-based payment arrangements were as follows:

Type of arrangement Grant date Quantity granted Contract period Vesting conditions Restricted stocks to employees 2019.11.25 5,000 thousand shares 3 years Note Note: The service time limit and performance conditions were as follows:

(a) After employees obtain employee restricted shares, starting from the effective date of capital increase, if employees are on-the-job when the vested period has expired, also, meet certain standard of annual individual performance assessment and comply with regulation, did not violate service contract of the Company, working rules and be penalized, the employees can achieve vested conditions.
(b) The Group can use the earnings per share and profit growth of parent company only financial statements in the latest year of vesting period expires as a basis of performance conditions: The first year: Earnings per share was above $0.3 (including $0.3); The second year: Earnings per share was above $0.8 (including $0.8); and The third year: Earnings per share was above $1.0 (including $1.0).
(c) After achieving individual performance conditions and company performance conditions in the same time, employees’ proportion of shares under vested condition in the current year based on the service conditions were as follows:
Service for one year after distribution, 30% of the distributed shares;
Service for two years after distribution, 30% of the distributed shares; Service for three years after distribution, 40% of the distributed shares;
Restrictions on the rights and vesting conditions of restricted shares for employees were as follows:
(a) The restricted shares which the employees will obtain were kept by the designated trust institution as trustee, which the employee cannot request to return the restricted shares for any reasons or ways.
(b) Before accomplishing the vesting conditions, the employee cannot sell, pledge, transfer, gift, set or dispose in other ways, and they have no right to be allotted or obtaining dividends. Other rights are similar with the capital that has been issued.
(c) Before the employee accomplishes the vesting conditions, the attendance, proposal, speaking, right of voting, and other matters associated with shareholders' meeting were executed based on the trust custody contracts.

~28~

(d) From the book closure date of issuance of bonus shares, cash dividends, issuance of common stock for cash and shareholders' meeting are regulated by Article 165-3 of the Company Law, or other facts that has occurred to the date of rights allocation. The unrestricted shares of the employees that have achieved the vesting conditions during the aforementioned period still have no rights to obtain dividends or allotment.
C. Details of the share-based payment arrangements are as follows: (unit: thousand shares)

2022 At January 1 and March 31 $ 1,681

D. On November 25, 2019, the fair value of share-based payments transaction which was given by the Group was $15.8 per share.
E. For the three months ended March 31, 2022, the Group recognised expenses due to share-based payment transactions in the amount of $2,083.
(18) Share capital
A. On March 31, 2023, the Company’s authorised capital was $20,000,000, consisting of 2,000,000 thousand shares (including the number of option certificates which can be purchased), and will be issued in several times. The shares which were not issued can be issued in common shares and preference shares in several times based on the Company’s business requirement, 90,000 thousand shares will be retained for option certificates. As of March 31, 2023, the Company’s paid-in capital was $8,255,783, consisting of 555,308 thousand common shares, 90,090 thousand class B preferred shares and 180,180 thousand class C preferred shares in private placement, with a par value of NT$10 (in dollars) per share. All proceeds from shares issued have been collected. The Company’s outstanding number of preference shares in the beginning and ending of the period were the same.

Movements in the number of the Company’s ordinary shares outstanding are as follows: (thousand shares)

thousand shares)
		2023		2022
Shares outstanding at January 1		555,308		553,736
Restricted shares called back but not yet		22		15
cancelled at the beginning of the period
Restricted shares not yet vested at the
beginning of the period		-		1,681
Shares issued at January 1		555,330		555,432
Cancellation of employee restricted shares	(	22)	(	15)
Restricted shares not yet vested at the
end of the period		-	(	1,681)
At March 31		555,308		553,736

~29~

B. The Company had increased capital by cash by $1,800,000 thousand, consisting of 180,000 thousand shares with a par value of $10 per share and issued at discounted price of $9.2 on May 30, 2007. The rights and obligations of new shares by private placement are the same as those of common shares. The number of the Company’s private placement common shares outstanding was 70,785 thousand shares due to the reduction of ordinary share capital conducted by the Company in the past. The registration for the retroactive handling of public issuance procedures for the private placement common shares was filed in September 2022 and the registration became effective on October 3, 2022 in accordance with the Order No. Tai-ZhengShang-Yi-Zi-1111804957. The shares have been traded and listed on the Taiwan Stock Exchange since October 18, 2022.
C. On June 29, 2018, the Company’s shareholders approved to issue restricted shares in the amount of 50,000 thousand, which was common share with a par value of $10, has been applied for effectiveness through FSC on June 10, 2019. The effective date was November 25, 2019 and the registration of changes has been completed on December 10, 2019.
D. For details of the issuance of class B preferred shares, please refer to Note 6(16).
E. On December 3, 2020, the Company’s shareholders in the extraordinary meeting approved to issue 180,180 thousand class C preferred shares in private placement with a par value of $10 and issued at $11.1 per share. The paid-in capital was $1,801,800 thousand. The effective date of capital increase was set on December 21, 2020 in accordance with the Securities and Exchange Act Article 43-6.
According to the Company’s Articles of Incorporation, the rights and obligations of preferred share were as follows:
(a) The distribution of earnings was based on the Company’s Articles of Incorporation, current year or current quarter and accumulated undistributable dividend shall be appropriated to class B preferred shares in the first priority, then, appropriated to class C preferred shares in the second priority.
(b) The annual dividend rate of class C preferred shares was 2% which were calculated at the issuance price per share and paid in cash, the ex-dividend date of preferred dividend was authorised to be determined by the Board of Directors. The issuance number in issuance year or quarter and recovered year or quarter were calculated at the actual issuance number of days.
(c) If the expected dividend distribution amount of common share exceeds the dividend amount of class C preferred shares in the current year or quarter, the shareholders of class C preferred shares can participate in the distribution until the dividend amount of class C preferred shares are the same as common share per share.
(d) The Company has discretion in dividend distribution of Class C preferred shares. If the Company has no or has insufficient current year’s earnings for distribution or has other necessary considerations, the Company can resolve not to distribute dividend to class C preferred shares and it will not default, and the shareholders of class C preferred shares cannot object. Class C preferred shares are non-cumulative, and the amount of dividends which were not distributed or insufficient will not be made up in the profitable year or quarter thereafter.

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(e) Starting from the next day of five years after issuance, the shareholders of class C preferred shares can transfer the preferred share to common share at a transfer ratio of 1:1. After the transfer of preferred share to common share, the rights and obligations (excluding the transfer restriction by regulation and not listed) were the same as other outstanding common share of the Company. For class C preferred shares which have been transferred into common shares before the ex-right (exdividend) date in the current year or quarter can participate in the common share distribution of earnings or reserves in the current year or quarter and cannot participate in the dividend distribution of preferred shares in the current year or quarter. For class C preferred shares which have been transferred into common shares after the ex-right (ex-dividend) date in the current year or quarter can participate in the dividend distribution of preferred share in the current year or quarter and cannot participate in the dividend distribution of earnings or capital reserves in the current year or quarter. Preferred dividends will not be repeatedly appropriated if it is distributed in the same year or quarter with common stock dividends.
(f) The shareholders of class C preferred shares have no voting right in the common shareholders’ meeting and cannot be elected as directors (including independent directors). However, the shareholders of class C preferred shares have voting right in preferred shareholders’ meeting and matters of preferred shareholders’ right.
(g) When it comes to appropriating residual assets of Company, class C preferred shares have priority over common shares and next to class B preferred shares. However, the amount was limited to the issuance price plus total amount of unpaid dividend.
(h) Class C preferred shares have no expiry date, and the shareholders of class C preferred shares have no right to require the Company to call back class C preferred shares or transfer the class C preferred share into common share in advance. However, the Company can call back in cash at actual issuance price, mandatorily transfer by issuing new shares or call back all or some class C preferred shares in other ways permitted by regulations on the next day after three years. The rights and obligations of class C preferred shares which have not been called will continue until the Company calls back. In the current year of calling back the class C preferred shares, if the Company’s shareholders resolve to appropriate dividends, the amount of dividends which have to be distributed as of the date of call back will be calculated according to the actual days of issuance in the current year.
(i) The preemptive rights for stockholders of class C preferred shares are the same as of common shares when the Company increases its capital by issuing shares.
(j) Class C preferred shares were not listed and traded in the issuance period, however, if all or some were transferred into common shares, the Board of Directors was authorised to apply for public offering and listing to the authorisation according to the current situation and related regulations.

~31~

(19) Capital surplus

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

the legal reserve is insufficient.
Premium on issuance of common shares Premium on issuance of preferred shares Changes in ownership interests in subsidiaries Difference between consideration and carrying amount of subsidiaries acquired or disposed Changes of associates and joint ventures accounted for using equity method Employee restricted shares	March31,2023 17,417 $ 198,198 5,832 16,940 - - 238,387 $	December31,2022 March31,2022 17,417 $ - $ 198,198 198,198 5,832 5,717 16,940 16,940 - 2,675) ( 216) ( 16,869 238,171 $ 235,049 $

(20) Retained earnings

A. According to the Company’s Articles of Incorporation, after every end of quarter, the Company can appropriate earnings or offset deficits, and for earnings which were appropriated in the form of cash, it shall be resolved by the Board of Directors and reported to shareholders in accordance with the Company Act, Article 228-1 and paragraph 5 of Article 240.
B. Under the Company’s Articles of Incorporation, the current year’s earnings, if any, shall first be used to pay all taxes and offset prior years’ operating losses and then 10% of the remaining amount shall be set aside as legal reserve. For setting aside or reversal for special reserve in accordance with related laws or Competent Authority’s regulations, if any, the Board of Directors should propose the distribution of the remaining earnings along with prior accumulated undistributed earnings for the approval of the shareholders.
C. The industry environment of the Company is constantly changing and the enterprise is in the growth stage of its life cycle. Considering the Company’s capital requirement in the future and long-term financial plan and satisfying shareholders’ demand of cash inflow, the expected appropriation amount in the current year shall not be lower than 10% of accumulated distributable amount. However, if the accumulated distributable earnings is lower than 1% of paid-in capital, the earnings cannot be appropriated, and the cash dividend shall not be lower than 10% of total dividend.

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D. According to Company Act, the distribution to legal reserve shall continue until the total amount equals to total capital. Legal reserve is used to offset accumulated deficits. If the Company has no deficits, 25% of the part of legal reserve exceeding the paid-in capital can be used to issue new stocks or cash to shareholders in proportion to their share ownership.
E. Following the adoption of TIFRS, the FSC on April 6, 2012 issued Order No. FinancialSupervisory- Securities-Corporate-1010012865, which sets out the following provisions for compliance: On a public company’s first-time adoption of the TIFRS, for any unrealized revaluation gains and cumulative translation adjustments (gains) recorded to shareholders’ equity that a company elects to transfer to retained earnings by application of the exemption under IFRS 1, the company shall set aside an equal amount of special reserve. Following a company’s adoption of the TIFRS for the preparation of its financial reports, when distributing distributable earnings, it shall set aside to special reserve, from the profit/loss of the current period and the undistributed earnings from the previous period, an amount equal to other net deductions from shareholders’ equity for the current fiscal year, provided that if the company has already set aside special reserve according to the requirements in the preceding point, it shall set aside supplemental special reserve based on the difference between the amount already set aside and other net deductions from shareholders’ equity. For any subsequent reversal of other net deductions from shareholders’ equity, the amount reversed may be distributed.
F. On April 28, 2022, the Board of Directors resolved the earnings appropriation for the year ended December 31, 2021 with a common share dividend of 1 per share and the total amount was $553,736; cash dividends on class C preferred share of $1 per share for a total dividend amounting to $180,180, was approved by the shareholders at their meeting on June 10, 2022.
G. On April 26, 2023, the Board of Directors resolved the earnings appropriation for the year ended December 31, 2022 with a common share dividend of $0.85 per share and the total amount was $472,012; and with class C preferred share dividend of $0.85 per share. The total dividends amounted to $153,153.
H. On April 28, 2022, the Company’s Board of Directors resolved not to distribute the appropriation of earnings in the first quarter of 2022; On April 26, 2023, the Company’s Board of Directors resolved not to distribute the appropriation of earnings in the first quarter of 2023.

(21) Operating revenue

Operating revenue
Revenue from contracts with customers IC packaging and testing service revenue Electronics manufacturing service revenue Other operating revenue	Threemonths endedMarch31
	2023 2,057,109 $ 1,156,898 39,404 3,253,411 $	2022
		2,580,226 $ 1,230,758 27,916
		3,838,900 $

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A. Disaggregation of revenue from contracts with customers

		Semiconductor	Semiconductor
Three months ended March 31, 2023			Group	EMS Group				Total
IC packaging and testing service revenue		$	2,057,109	$		-	$	2,057,109
Manufacture of`e`lectronic products			-		1,156,898			1,156,898
Others			6,767		32,637			39,404
		$	2,063,876	$	1,189,535		$	3,253,411
Timing of revenue recognition:
Over time		$	2,057,109	$		-	$	2,057,109
At a point in time			6,767		1,189,535			1,196,302
		$	2,063,876	$	1,189,535		$	3,253,411
		Semiconductor
Three months ended March 31, 2022			Group	EMS Group				Total
IC packaging and testing service revenue		$	2,580,226	$		-	$	2,580,226
Manufacture of`e`lectronic products			-		1,230,758			1,230,758
Others			6,694		21,222			27,916
		$	2,586,920	$	1,251,980		$	3,838,900
Timing of revenue recognition:
Over time		$	2,580,226	$		-	$	2,580,226
At a point in time			6,694		1,251,980			1,258,674
		$	2,586,920	$	1,251,980		$	3,838,900
B. Contract assets and liabilities
(a) The Group has recognised the following revenue-related				contract assets		and liabilities:
	March	31,	2023 December		31,2022		March31,2022
Current contract assets
IC packaging and
testing service	$	243,424 $			272,248	$		285,944
Current contract liabilities
IC packaging and
testing service	$	67,423 $			68,026	$		70,531
Manufacture of electronic
products			8,845		9,853			18,762
	$	76,268 $			77,879	$		89,293

Note: As of January 1, 2022, the Group recognised current contract liabilities in the amount of $88,971.

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(b) Information relating to credit risk of contract assets is provided in Note 12(2).
(c) For the three months ended March 31, 2023 and 2022, revenue recognised that was included in the contract liability balance at the beginning of the period amounted to $1,611 and $1,316, respectively.

(22) Interest income

respectively. Interest income
Interest income from bank deposits Interest income from loans to others Interest income from financial assets measured at amortised cost	2023 2022 6,618 $ 562 $ - 407 - 1 6,618 $ 970 $ Threemonths endedMarch31
		562 $ 407 1 970 $

(23) Other income

Other income
Service revenue Rental revenue Other income	Three months ended March 31
	2023 2022 1,692 $ 4,192 $ 1,639 1,987 17,270 4,824 20,601 $ 11,003 $

(24) Other gains and losses

Other gains and losses
			Threemonths ended		March31
			2023		2022
Gains on disposals of property, plant and equipment		$	214	$	5,771
Gains on disposals of non-current assets held for sale			-		54,271
Net currency exchange (losses) gains	(		21,679)		40,639
Gains on lease modification			-		1,772
Losses on financial assets at fair value through			-	(	1,261)
profit or loss
Others	(		21)	(	20,884)
	($		21,486)	$	80,308

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(25) Finance costs

(25)	Finance costs
(26)	Expenses by nature Interest expense on borrowings from financial institutions Interest expense on lease liability Dividends on preference share liabilities Others Less: Capitalisation of qualifying assets Employee benefit expense Depreciation charges on property, plant and equipment (Note) Depreciation expense on right-of-use assets Amortisation charges on intangible assets	2023 2022 3,518 $ 2,274 $ 689 856 4,612 4,612 2 1 8,821 7,743 - 1,995) ( 8,821 $ 5,748 $ Threemonths endedMarch31 Three months ended March 31
		2023 921,876 $ 252,536 5,239 10,715	2022
			989,406 $ 284,442 7,421 7,412

Note: Including the amortisation of losses on sale and leaseback transactions to depreciation charges amounting to $0 and $18 for the three months ended March 31, 2023 and 2022, respectively. (27) Employee benefit expense

Employee benefit expense
Salary expenses Labour and health insurance fees Pension costs Directors’ remuneration Compensation cost of employee restricted shares Other personnel expenses	Threemonths endedMarch31
	2023 733,833 $ 87,626 38,839 1,818 - 59,760 921,876 $	2022
		800,935 $ 84,672 33,763 5,935 2,083 62,018
		989,406 $

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Under the Company’s Articles of Incorporation, the current year's pre-tax profit, net of employees’ compensation and directors’ remuneration, shall be first used to offset accumulated deficits, than appropriate over 8%~12% for employees’ compensation and under 3% for remuneration to directors. In addition, the appropriation ratios were amended to be 10%~15% for employees’ compensation and under 1% for remuneration to directors as resolved at the shareholders’ meeting on July 15, 2021.

A company may, by a resolution adopted by a majority vote at a meeting of Board of Directors attended by two-thirds of the total number of directors, has the determination of distribution ratios of employees’ compensation and directors’ remuneration and the abovementioned employees’ compensation distributed in the form of shares or in cash; and in addition thereto a report of such distribution shall be submitted to the shareholders during their meeting. The profit distributable as employees’ compensation distributed can be in the form of shares or in cash. Qualification requirements of employees, including the employees of subsidiaries of the company meeting certain specific requirements, entitled to receive aforementioned stock or cash may be specified in the Articles of Incorporation.

For the three months ended March 31, 2023 and 2022, the employees’ compensation and directors’ remuneration were estimated and accrued based on certain proportion of distributable profit of current year amounting to $10,983 and $51,252; as well as $1,098 and $5,125, respectively.

Employees’ bonus of $197,500 and directors’ and supervisors’ remuneration of $19,740 for 2022 as resolved by the Board of Directors were in agreement with those amounts recognised in the 2022 financial statements. Additionally, the employees’ compensation and directors’ remuneration for the previous year has not yet been distributed.

In addition, the compensation of employees and directors for the previous year has not yet been allotted. Information about employees’ compensation and directors’ remuneration of the Company as resolved by the Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(28) Income tax

A. Income tax expense

Taiwan Stock Exchange. ome tax Income tax expense
			Threemonths ended		March31
			2023		2022
Current tax:
Current tax on profits for the period		$	4,404	$	9,836
Prior year income tax (over) underestimation	(		70,101)		-
Total current tax	(		65,697)		9,836
Deferred tax:
Origination and reversal of temporary differences	(		16,275)		31,941
Origination and reversal of tax loss			-		56,835
Total deferred tax	(		16,275)		88,776
Income tax (benefit) expense	($		81,972)	$	98,612

~37~

B. The income tax (charge)/credit relating to components of other comprehensive income is as follows:

Changes in fair value of financial assets at fair value through other comprehensive income Currency translation differences Share of other comprehensive income of associates	2023 2022 - $ 1,992) ($ 894 2,174 - 349 894 $ 531 $ Threemonths endedMarch31

C. The Company’s income tax returns through 2021 have been assessed and approved by the Tax Authority.

(29) Earnings per share

C. The Company’s income tax returns through 2021 have been assessed and approved by the Authority. Earnings per share	ugh 2021 have been assessed and approved by the	ugh 2021 have been assessed and approved by the	ugh 2021 have been assessed and approved by the
Weighted average number of ordinary shares outstanding Earnings per share Amount after tax (share in thousands) (in dollars) Basic earnings per share Profit attributable to the parent 179,721 $ Less: Dividends on class C preferred shares 39,625) ( Profit attributable to ordinary 140,096 $ 555,308 0.25 $ shareholders of the parent (Note) Diluted earnings per share Profit attributable to the parent 179,721 $ 555,308 Less: Dividends on class C preferred shares 39,625) ( Assumed conversion of all dilutive potential ordinary shares Employees’ compensation - 6,269 Convertible preferred stock 39,625 180,180 Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares 179,721 $ 741,757 $ 0.24 $ Three months ended March31,2023	Three months ended March31,2023
		Weighted average number of ordinary shares outstanding (share in thousands) 555,308 555,308 6,269 180,180 741,757 $	Earnings per share (in dollars)
			0.25 $
			0.24 $

~38~

Three months ended March 31, 2022

Amount after tax Basic earnings per share Profit attributable to the parent 367,363 $ Less: Dividends on class C preferred shares 81,170) ( Profit attributable to ordinary 286,193 $ shareholders of the parent (Note) Diluted earnings per share Profit attributable to the parent 367,363 $ Less: Dividends on class C preferred shares 81,170) ( Assumed conversion of all dilutive potential ordinary shares Employees’ compensation - Employee restricted stock - Convertible preferred stock 81,170 Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares 367,363 $		Weighted average number of ordinary shares outstanding (share in thousands) 553,736 553,736 3,665 1,411 180,180 738,992 $	Earnings per share (in dollars)
			0.52 $
			0.50 $

Note: The Company issued three classes of equity instruments, including ordinary shares, class B preferred shares and class C preferred shares. Since class C preferred shares are noncumulative and participating equity instruments (refer to Note 6(18)E. (c) for the related terms of issuance), the Company assumed that ordinary shares and participating equity instruments would share in earnings until all of the profit or loss for the period had been distributed when calculating the profit or loss attributable to ordinary shareholders of the parent.

(30) Supplemental cash flow information

A. Investing activities with partial cash payments:

pplemental cash flow information Investing activities with partial cash payments:
			Threemonths ended		March31
			2023		2022
Purchase of property, plant and equipment		$	159,765	$	327,302
Increase (decrease) in prepayments for business			26,537	(	124,610)
facilities
Add: Opening balance of payable on equipment (Note)			303,918		633,814
Less: Ending balance of payable on equipment (Note)	(		231,555)	(	342,204)
Cash paid during the period		$	258,665	$	494,302

’ Note : Shown as ‘other payables .

~39~

B. Investing and financing activities with no cash flow effects `：`

Three months ended March 31 2023 2022 Prepayments for business facilities transferred to prepayment $ 120 $ - Prepayments for business facilities transferred to property, plant and equipment $ 326,762 $ 446,095 Long-term borrowings, current portion $ 2,904 $ 15,375

(31) Changes in liabilities from financing activities

Long-term borrowings Lease liabilities Guarantee deposits received Preference share liabilities Short-term borrowings Short-term note and bills payables Long-term borrowings Lease liabilities Guarantee deposits received Preference share liabilities	January1,2023 Cash flows 1,148,962 $ - $ 161,310 6,953) ( 39,864 1,791) ( 1,003,851 - January1,2022 Cash flows 299,408 $ 337,140 $ 49,986 50,000) ( 648,394 97,432) ( 249,042 9,074) ( 57,018 1,972) ( 1,005,149 -	Changes in foreign exchange rate Others - $ - $ - - 12 - - 319) ( Changes in foreign exchange rate Others 169 $ - $ 14 - - 1,069 49,344) ( - 4 - 320) (	March 31,2023
			1,148,962 $ 154,357 38,085 1,003,532 March 31, 2022
			636,717 $ - 550,962 191,693 55,050 1,004,829

7. Related Party Transactions

(1) Names of related parties and relationship

Names of related parties Relationship with the Company ATP Electronics Taiwan Inc. (ATP) Associate (Note 1) OSE Properties, Inc. (Properties) Associate Chipbond Technology Corporation (Chipbond) Entities with significant influence to the Group Phison Electronics Corp. (Phison) Key management personnel (Note 2)

Note 1: The Group sold all its equity interests in ATP in August to September 2022; therefore, it was no longer the Group’s associate.

Note 2: This person was on longer the Group’s related party after resigning from being the Group’s director since November 7, 2022

~40~

(2) Significant related party transactions

A. Sales

Phison Associates Entities with significant influence to the Group	2023 2022 - $ 595,082 $ - 52,070 71 - 71 $ 647,152 $ Three months ended March 31

The sales price to the above related parties was determined through mutual agreement based on the market rates. The collection term is available to third parties.

B. Purchases:

Purchases:
Key management personnel of the Group Entities with significant influence to the Group Associates	Three months ended March31
	2023 - $ 8 - 8 $	2022
		400 $ 625 654
		1,679 $

The purchase price to the above related parties was determined through mutual agreement based on the market rates. The payment term is available to third parties.

C. Receivables from related parties:

Receivables from related parties:
Accounts receivable: Phison Associates Entities with significant influence to the Group Other receivables: Properties Entities with significant influence to the Group Associate Key management personnel of the Group	March31,2023 - $ - 76 76 $ - $ - - - - $	December31,2022 - $ - 399 399 $ - $ - - - - $	March31,2022
			268,145 $ 36,967 -
			305,112 $
			447 $ 6,405 2,751 682
			10,285 $

Receivables from related parties mainly arose from sales, leases, sales of equipment and interest income from borrowings. The terms for receivables from sales are 30~60 days after delivery or 30 days after monthly billings. The receivables are unsecured in nature and bear no interest.

~41~

D. Payables to related parties:

Payables to related parties:
Accounts payable: Associate Entities with significant influence to the Group Key management personnel of the Group Other payables: PROPERTIES Entities with significant influence to the Group	March31,2023 - $ 8 - 8 $ - $ 24,932 24,932 $	December31,2022 - $ 736 - 736 $ - $ 20,000 20,000 $	March31,2022 703 $ 677 114
			1,494 $
			20,790 $ 25,534
			46,324 $

Payables to related parties pertain to purchase of materials, machinery and equipment, computer software, data maintenance and service fees, purchase of equipment, rents and dividends on preference share liabilities. The payment terms are 150 days after acceptance, 30 days after monthly billings and 60 days after delivery. The payables bear no interest.

E. Property transactions:

Disposal of property, plant and equipment:

Three months ended March31	Three months ended March31	Three months ended March31
Disposal proceeds Gain on disposal $ - $- 2023	2022
Disposal proceeds $ -	Disposalproceeds $ 6,100	Gain on disposal
		$ 6,069

`－` F. Lease transactions lessor

ease transactions`－`lessor
Rental income: ATP Entities with significant influence to the Group	Three months ended March31
	2023 - $ 251 251 $	2022
		1,064 $ 225
		1,289 $

Plant, office and equipment were leased under mutual agreement, and the collection term is available to third parties.

~42~

G. Loans to/from related parties:

Loans to PROPERTIES:

(a) The Group’s subsidiary, OSE Philippines, Inc. lent US$4,387 thousand to the associate, Properties, on July 31, 1996, principal and interest are paid after disposal of properties, and the Group has first mortgage right under mutual agreement. In the first quarter of 2015, PROPERTIES repaid US$1,285 thousand due to disposal of certain land. As of March 31, 2022, PROPERTIES has fully paid the borrowings.
(b) As of March 31, 2022, interest income recognised in other receivables amounted to $447 and $407, respectively. For the three months ended March 31, 2022, interest income was collected at 2.5% per annum.
H. Others

Details of the Company’s class B preferred shares held by the entities with significant influence

to the Group are provided in Notes 6(16) and (25).

(3) Key management compensation

(3)Key management compensation
Pledged Assets Salaries and other short-term employee benefits Post-employment benefits Share-based payment Pledged asset March 31, 2023 Property, plant and equipment - Buildings and structures 764,575 $ - Machinery and equipment 289,399 Guarantee deposits paid - time deposits 14,018 1,067,992 $	2023 2022 8,662 $ 12,357 $ 135 162 - 217 8,797 $ 12,736 $ Three months ended March 31 December 31,2022 March 31, 2022 Purpose 771,674 $ 793,054 $ Credit line for ling-term-borrowings 330,803 457,076 Credit line for ling-term-borrowings 14,000 131,500 Customs guarantee or others 1,116,477 $ 1,381,630 $ Book value
Property, plant and equipment - Buildings and structures - Machinery and equipment Guarantee deposits paid - time deposits		793,054 $ 457,076 131,500	Credit line for ling-term-borrowings Credit line for ling-term-borrowings Customs guarantee or others
		1,381,630 $

8. Pledged Assets

9. Significant Contingent Liabilities and Unrecognised Contract Commitments

(1) Contingencies

None.

(2) Commitments

A. As of March 31, 2023, December 31, 2022 and March 31, 2022, guarantee given by the bank for the payment of input tax imposed for sales from a tax free zone to non-tax free zone amounted to $400,000.
B. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Company issued promissory notes of $8,008,664, $8,017,920 and $7,600,432, respectively, as guarantees for bank loans.
C. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Company issued promissory notes of $13,738 $13,738 and $6,573, respectively, as guarantees for payments of raw materials and machineries purchased.

~43~

D. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Group had letters of credit issued but not used amounting to US$404 thousand, US$112 thousand and US$128 thousand, respectively.
E. Capital expenditure contracted for at the balance sheet date but not yet incurred is as follows:

Property, plant and equipment	March31,2023 97,987 $	December31,2022 201,515 $	March31,2022 315,302 $

10. Significant Disaster Loss

None.

11. Significant Events after the Balance Sheet Date

(1) On April 26, 2023, the Board of Directors resolved the appropriation of 2022 earnings. Refer to Note 6(20) for details.

(2) On April 26, 2023, the Board of Directors of the Company resolved to issue employee restricted shares of 5,000 thousand shares with a par value of NT$10 per share, total amounting to $50,000 thousand, which was still pending to be resolved by the shareholders at their meeting for the year of 2023.

12. Others

(1) Capital management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

During the three months ended March 31, 2023, the Group’s strategy, which was unchanged from 2022, was to balance overall capital structure. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Group’s gearing ratio is as follows:

Total liabilities Total assets Gearing ratio	March31,2023 6,043,678 $ 16,191,118 $ 37%	December31,2022 7,196,008 $ 16,946,784 $ 42%	March31,2022
			7,271,485 $
			16,625,685 $
			44%

~44~

(2) Financial instruments

A. Financial instruments by category

nancial instruments Financial instruments by category
Financial assets Financial assets measured at fair value through other comprehensive income Designation of equity instrument Financial assets at amortised cost Cash and cash equivalents (excluding cash on hand) Financial assets at amortised cost Notes receivable Accounts receivable (including related parties) Other receivables (including related parties) Guarantee deposits paid Financial liabilities Financial liabilities at amortised cost Short-term borrowings Notes payable Accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including current portion) Preference share liability Lease liability (including current and non-current)	March31,2023 1,311,998 $ 3,291,982 $ 243,520 103 2,984,544 34,028 16,461 6,570,638 $ March 31,2023 - $ - 2,479,892 859,389 1,148,962 1,003,532 5,491,775 $ 154,357 $	December31,2022 1,021,427 $ 3,945,629 $ 245,600 155 3,022,486 38,894 17,098 7,269,862 $ December 31,2022 - $ - 3,043,151 1,319,565 1,148,962 1,003,851 6,515,529 $ 161,310 $	March31,2022
			475,616 $
			3,174,000 $ - - 3,070,591 49,942 134,555
			6,429,088 $
			March 31,2022
			636,717 $ 2,452 3,115,511 1,082,452 550,962 1,004,829
			6,392,923 $
			191,693 $

B. Financial risk management policies
(a) The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk.
(b) The Group has established appropriate policies, procedures and internal controls in accordance with the relevant regulations to manage the aforementioned financial risks. Before entering into significant transactions, due approval process by the Board of Directors and Audit Committee must be carried out based on the relevant regulations and internal control procedures. The Group complies with its financial risk management policies at all times.
C. Significant financial risks and degrees of financial risks
(a) Market risk

Foreign exchange risk

i. The Group operates internationally and is exposed to exchange rate risk arising from the transactions of the Company and its subsidiaries used in various functional currency, primarily with respect to the USD and RMB. Foreign exchange rate risk arises from future commercial transactions, recognised assets and liabilities and net investment in foreign operations.

~45~

ii. The Group’s management hedges foreign exchange risk through natural hedges or derivative financial instruments (including forward foreign exchange contracts) to prevent decreases in value of assets denominated in foreign currencies and fluctuations in future cash flows. The use of these derivative financial instruments assists in decreasing the effect of foreign currency fluctuations but cannot eliminate the impact entirely. The Group’s purpose to hold certain investments in foreign operations is for strategic investments; thus, the Group does not hedge those investments.
iii. The Group’s businesses involve some non-functional currency operations (the Company’s and certain subsidiaries’ functional currency: NTD; other certain subsidiaries’ functional currency: USD and RMB). The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows:

~46~

		March31,2023	March31,2023
Foreign currency amount (In thousands) 91,643 $ 404,511 20,710 55,269 345,197	Exchange rate 30.44 0.2288 30.44 30.44 0.2288	Book value Degree of (NTD) variation 2,789,613 $ 1% 92,552 1% 630,402 1% 1,682,388 1% 78,981 1% December31,2022		Sensitivityanalysis
				Effect on profit or loss 27,896 $ 926 - 16,824 790	Effect on other comprehensive income
					- $ - 6,304 - -
Foreign currency amount (In thousands) 119,925 $ 805,561 20,127 71,953 580,962	Exchange rate 30.70 0.2325 30.70 30.70 0.2325	Book value (NTD) 3,681,698 $ 187,293 635,907 2,208,957 135,074		Sensitivityanalysis
			Degree of variation 1% 1% 1% 1% 1%	Effect on profit or loss 36,817 $ 1,873 - 22,090 1,351	Effect on other comprehensive income
					- $ - 6,359 - -

~47~

Foreign currency amount (In thousands) (Foreign currency: functional currency) Financial assets Monetary items USD:NTD 102,364 $ JPY:NTD 551,150 Non-monetary items USD:NTD 1,045 Financial liabilities Monetary items USD:NTD 79,628 JPY:NTD 211,603	Exchange rate 28.62 0.2353 28.62 28.62 0.2353	Book value Degree of Effect on profit Effect on other (NTD) variation or loss comprehensive income 2,929,658 $ 1% 29,297 $ - $ 129,686 1% 1,297 - 29,921 1% - 299 2,278,953 1% 22,790 - 49,790 1% 498 - Sensitivityanalysis March31,2022	Book value Degree of Effect on profit Effect on other (NTD) variation or loss comprehensive income 2,929,658 $ 1% 29,297 $ - $ 129,686 1% 1,297 - 29,921 1% - 299 2,278,953 1% 22,790 - 49,790 1% 498 - Sensitivityanalysis March31,2022
			- $ - 299 - -

~48~

iv. The total exchange gain (loss), including realised and unrealised, arising from significant foreign exchange variation on the monetary items held by the Group for the three months ended March 31, 2023 and 2022 amounted to ($21,679) and 40,639, respectively.

Price risk

i. The Group’s equity securities, which are exposed to price risk, are the held financial assets at fair value through other comprehensive income. The Group manages the equity price risk through diversification and placing limits on individual and total equity instruments. Reports on the equity portfolio are submitted to the Group’s senior management on a regular basis. The Group’s Board of Directors reviews and approves all equity investment decisions.
ii. The Group’s investments in equity securities comprise shares issued by the domestic and foreign companies. The prices of equity securities would change due to the change of the future value of investee companies. If the prices of these equity securities had increased/decreased by 1% with all other variables held constant, other components of equity for the three months ended March 31, 2023 and 2022 would have increased/decreased by $13,120 and $4,756, respectively, as a result of other comprehensive income classified as equity investment at fair value through other comprehensive income.

Cash flow and fair value interest rate risk

The Group’s long-term borrowings are floating-rate debts; therefore, the effective interest rate of its long-term borrowings will vary according to changes in market interest rates. If the market interest rate had increased/decreased by 25 basis points with all other variables held constant, post-tax profit for the three months ended March 31, 2023 and 2022 would have increased/decreased by $574 and $276, respectively. The main factor is that changes in interest expense result in floating-rate borrowings.

(b) Credit risk

i. Credit risk refers to the risk of financial loss to the Group arising from default by the counterparties of financial instruments on the contract obligations. The Group is exposed to credit risk from its operating activities (mainly accounts receivable and notes receivable) and from its financing activities (mainly bank deposits and various financial instruments). The maximum exposure to aforementioned credit risk was the carrying amount of financial assets recognised in the consolidated balance sheet.
ii. Customer credit risk is managed by each business unit in accordance with the Group’s policy, procedures and control relating to customer credit risk management. Credit limits are established for all customers based on their financial position, rating from credit rating agencies, historical experience, prevailing economic condition and the Group’s internal rating criteria, etc. Certain customer’s credit risk will also be managed by taking credit enhancing procedures, such as requesting for prepayment or insurance.

~49~

iii. As of March 31, 2023, December 31, 2022 and March 31, 2022, the amounts of accounts and notes receivable from top ten customers constitute 83%, 81% and 83%, respectively, of the Group’s total accounts and notes receivable. The credit concentration risk of the remaining accounts and notes receivable is immaterial.
iv. The Group’s treasury manages the credit risks of bank deposits and other financial instruments based on the Group’s credit policy. Because the Group’s counterparties are determined based on the Group’s internal control, only banks and companies with good credit rating and with no significant default risk are accepted. Consequently, there is no significant credit risk.
v. If the contract payments were past due over 30 days based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition. The default occurs when the contract payments are past due over 90 days.
vi. The Group classifies customer’s contract assets and notes and accounts receivable in accordance with credit rating of customer, geographic area and industry sector. The Group applies the simplified approach using a provision matrix to estimate the expected credit loss.
vii.The Group used the forecastability to adjust historical and timely information to assess the default possibility of accounts receivable. On March 31, 2023, December 31, 2022 and March 31, 2022, the provision matrix classified by customers is as follows:

			Overdue
Not past due 1,917,874 $ 2,000) ( 1,915,874 $ 0.10%	Up to 30 days 105,632 $ 856) ( 104,776 $ 0.10%`～`0.82%	31to 60 days 44,959 $ 628) ( 44,331 $ 0.10%`～`1.40%	61to 90 days 296 $ 5) ( 291 $ 0.10%`～`1.75% Overdue	91to180 days 751 $ 46) ( 705 $ 0.31%`～`6.09%	Over 180 days 45 $ 45) ( - $ 100%	Total
						2,069,557 $ 3,580) (
						2,065,977 $

Notpast due $ 1,070,564 1,027) ( 1,069,537 $ 0%`～`0.10%	Upto30days $ 90,850 35 90,885 $ 0%`～`0.10%	31 to60days $ 539 - 539 $ 0%`～`0.10%	61 to90days $ 318 - 318 $ 0%`～`0.10% Overdue	91 to 180days $ 987 172) ( 815 $ 0.31%`～17`.41%	Over 180days $ 131 131) ( - $ 100%	Total
						$ 1,163,389 1,295) (
						1,162,094 $

Not past due 1,846,741 $ 4,270) ( 1,842,471 $ 0%`～`0.36%	Up to 30 days 136,782 $ 4,402) ( 132,380 $ 0%`～`3.73%	31to 60 days 47,621 $ 4,500) ( 43,121 $ 0%`～9`.45%	61to 90 days 182 $ 17) ( 165 $ 0%`～`9.55% Overdue	91to180 days 604 $ 84) ( 520 $ 0%`～`13.89%	Over 180 days - $ - - $ 100%	Total
						2,031,930 $ 13,273) (
						2,018,657 $

Not past due $ 1,184,157 - 1,184,157 $ 0%	Up to 30 days $ 61,291 - 61,291 $ 0%	31to 60 days $ 29,805 50 29,855 $ 0%	61to 90 days 91to180 days $ 1,462 ($ 817) 78 206 1,540 $ 611) ($ 0% 0%`～`25.27%		Over 180 days $ 132 132) ( - $ 100%	Total
						$ 1,276,030 202
						1,276,232 $

~50~

March 31, 2022 IC semiconductor group Gross carrying amount (Note) Lifetime expected credit losses Carrying amount Loss ratio Electronics manufacturing services group Gross carrying amount Lifetime expected credit losses Carrying amount Loss ratio	Not past due Up to 30 days 31to 60 days 61to 90 days 2,098,886 $ 89,389 $ 43,736 $ 26,025 $ 4,232) ( 4,798) ( 9,447) ( 5,759) ( 2,094,654 $ 84,591 $ 34,289 $ 20,266 $ 0%`～`0.42% 0%`～`5.4% 0%`～`21.6% 0%`～`22.13% Not past due Up to 30 days 31 to 60 days 61 to 90 days $ 1,077,404 $ 40,643 $ 3,932 $ - - - - - 1,077,404 $ 40,643 $ 3,932 $ - $ 0% 0% 0% 0%`～`7.85% Overdue Overdue	91to180 days Over 180 days 1,937 $ 995 $ 1,181) ( 995) ( 756 $ - $ 60.97% 100% 91to180 days Over 180 days $ - $ 123 - 123) ( - $ - $ 8.98%`～`24.04% 100%	Total 2,260,968 $ 26,412) (
			2,234,556 $
			Total
			$ 1,122,102 123) (
			1,121,979 $

Note: Including the total amount of current contract assets, notes and accounts receivable.

viii. Movements in relation to the Group applying the modified approach to provide loss allowance for contract assets, accounts receivable and other receivable are as follows:

At January 1 Provision for impairment Reversal of impairment loss Effect of foreign exchange At March 31	2023 Accounts receivable 13,071 $ - 8,199) ( 3 4,875 $	2022
		Accounts receivable
		5,521 $ 21,011 - 3 26,535 $

For provisioned loss for the three months ended March 31, 2023 and 2022, there were no impairment losses arising from the contract assets and notes receivable.

(c) Liquidity risk

i. The Group’s objective on liquidity risk management is to ensure the sufficiency of financial flexibility by maintaining cash and bank deposits for operations and adequate bank financing quota.
ii. The table below analyses the Group’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

~51~

March 31, 2023 Non-derivative financial liabilities: Accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including current portion) Preference share liabilities Lease liabilities December 31, 2022 Non-derivative financial liabilities: Accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including current portion) Preference share liabilities Lease liabilities March 31, 2022 Non-derivative financial liabilities: Short-term borrowings Notes payable Accounts payable (including related parties) Other payables (including related parties) Long-term borrowings (including current portion) Preference share liabilities Lease liabilities	Less than 1year 2,479,892 $ 859,389 17,890 20,005 30,568 Less than 1year 3,043,151 $ 1,319,565 13,866 20,000 30,568 Less than 1year 637,513 $ 2,452 3,115,511 1,082,452 20,277 20,000 34,904	Between 2 and3 years - $ - 626,065 1,034,409 37,044 Between 2 and3 years - $ - 503,928 1,039,396 45,071 Between 2 and3 years - $ - - - 216,903 40,054 52,824	Between 4 and5 years - $ - 507,547 - 23,810 Between 4 and5 years - $ - 617,973 - 23,955 Between 4 and5 years - $ - - - 277,190 1,014,410 28,312	Over5 years - $ - 44,993 - 84,906 Over5 years - $ - 60,182 - 87,804 Over5 years - $ - - - 53,132 - 101,370	Total
					2,479,892 $ 859,389 1,196,495 1,054,414 176,328 Total
					3,043,151 $ 1,319,565 1,195,949 1,059,396 187,398 Total
					637,513 $ 2,452 3,115,511 1,082,452 567,502 1,074,464 217,410

(3) Fair value information

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

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

entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.

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Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3: Unobservable inputs for the asset or liability.

B. Financial instruments not measured at fair value
The carrying amounts of the Group’s financial instruments not measured at fair value, including cash and cash equivalents, current financial assets at amortised cost, accounts receivable (including related parties), other receivables (including related parties), guarantee deposits paid, long-term accounts receivable due from related parties, short-term borrowings, accounts payable (including related parties), other payables (including related parties), lease liabilities, preference share liabilities, long-term borrowings (including current portion) and guarantee deposits received, are approximate to their fair values.
C. The related information of financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets at March 31, 2023, December 31, 2022 and March 31, 2022 are as follows:
(a) The related information of nature of the asset and liabilities is as follows:

March 31, 2023 Assets Recurring fair value measurements Financial assets at fair value through other comprehensive income Equity securities December 31, 2022 Assets Recurring fair value measurements Financial assets at fair value through other comprehensive income Equity securities March 31, 2022 Assets Recurring fair value measurements Financial assets at fair value through other comprehensive income Equity securities	Level 1 1,301,385 $ Level 1 1,010,814 $ Level 1 445,695 $	Level 2 - $ Level 2 - $ Level 2 7,489 $	Level3 10,613 $ Level3 10,613 $ Level3 22,432 $	Total
				1,311,998 $
				Total
				1,021,427 $
				Total
				475,616 $

~53~

(b) The methods and assumptions the Group used to measure fair value are as follows:
- i. The fair value of equity instruments without active market (such as unlisted shares) was measured by applying a market approach based on the prices and other relevant information (such as the discount for lack of marketability and inputs like price to earnings ratio or price to book ratio) arising from the market transactions of the Company’s same or comparable equity instruments. Additionally, for equity instruments that lack sufficient or appropriate observable market information and comparable counterparties, net asset value is used to measure the profitability of underlying investments.
- ii. The fair value of derivative financial instrument options that do not have a quoted market price in an active market was measured by applying a binary tree valuation model.
- iii. The effect of unobservable inputs to the valuation of financial instruments is provided in Note 12(3)I.
D. For the three months ended March 31, 2023 and 2022, there was no transfer between Level 1 and Level 2.
E. The following chart is the movement of Level 3 for the three months ended March 31, 2023 and 2022:

At January 1 and March 31 At January 1 Losses recognised in profit or loss Losses recognised in other comprehensive income At January 1 and March 31	Derivativeinstrument Non-derivative equityinstrument - $ 10,613 $ Derivative instrument Non-derivative equityinstrument 1,261 $ 25,575 $ 1,261) ( - - 3,143) ( - $ 22,432 $ 2023 2022

F. For the three months ended March 31, 2023 and 2022, there was no transfer into or out from Level 3.
G. Treasury segment is in charge of valuation procedures for fair value measurements being categorised within Level 3, which is to frequently evaluate and measure fair value of financial instruments.
H. The following is the qualitative information of significant unobservable inputs and sensitivity analysis of changes in significant unobservable inputs to valuation model used in Level 3 fair value measurement:

~54~

Derivative instrument: Preference share liabilities returned Non-derivative equity instrument: Unlisted shares Derivative instrument: Preference share liabilities returned Non-derivative equity instrument: Unlisted shares Derivative instrument: Preference share liabilities returned Non-derivative equity instrument: Unlisted shares	Fair value at March31,2023 Valuationtechnique - $ Binary tree convertible valuation model 10,613 $ Net assets value Fair value at December31,2022 Valuationtechnique - $ Binary tree convertible valuation model 10,613 $ Net assets value Fair value at March31,2022 Valuation technique - $ Binary tree convertible valuation model 22,432 $ Net assets value	Significant Range unobservableinput (weighted average) Discount rate 2.5603% N/A N/A Significant Range unobservableinput (weighted average) Discount rate 2.5806% N/A N/A Significant Range unobservableinput (weighted average) Discount rate 2.3334% N/A N/A	Relationship of inputs tofairvalue The higher the discount rate, the lower the fair value. N/A Relationship of inputs tofairvalue The higher the discount rate, the lower the fair value N/A Relationship of inputs tofairvalue
			The higher the discount rate, the lower the fair value. N/A

I. The Group has carefully assessed the valuation models and assumptions used to measure fair value. However, use of different valuation models or assumptions may result in different measurement. The following is the effect of profit or loss or of other comprehensive income from financial assets categorised within Level 3 if the inputs used to valuation models have changed:

==> picture [468 x 248] intentionally omitted <==

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

March 31, 2023
Recognised in profit or loss Recognised in other comprehensive income
Input Change Favourable change Unfavourable change Favourable change Unfavourable change
Financial assets
Preference share liabilities
returned Discount rate ±1% $ - $ 8,919 $ - $ -
December 31, 2022
Recognised in profit or loss Recognised in other comprehensive income
Input Change Favourable change Unfavourable change Favourable change Unfavourable change
Financial assets
Preference share liabilities
returned Discount rate ±1% $ - $ 8,468 $ - $ -
March 31, 2022
Recognised in profit or loss Recognised in other comprehensive income
Input Change Favourable change Unfavourable change Favourable change Unfavourable change
Financial assets
Financial assets
Preference share liabilities
returned Discount rate ±1% $ - $ 12,703 $ - $ -
----- End of picture text -----

~55~

(4) Others

Due to the impact of the COVID-19 pandemic and various preventive measures imposed by the government, the Group has complied with the relevant measures and regulations on epidemic prevention announced by the government to reduce risks of personnel contact and cross transmission. The pandemic had no significant impact on the Group’s overall operations and financial position.

13. Supplementary Disclosures

(1) Significant transactions information

A. Loans to others: Please refer to table 1.
B. Provision of endorsements and guarantees to others: Please refer to table 2.
C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 3.
D. Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company’s paid-in capital: None.
E. Acquisition of real estate reaching $300 million or 20% of paid-in capital or more: None.
F. Disposal of real estate reaching $300 million or 20% of paid-in capital or more: None.
G. Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more: None.
H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: None.
I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Note 12(2).
J. Significant inter-company transactions during the reporting periods: Please refer to table 4.

(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China) ： Please refer to table 5.

(3) Information on investments in Mainland China

A. Basic information: Please refer to table 6.
B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 7.

(4) Major shareholders information

Names, number of shares and ownership of the Company’s shareholders who hold more than 5% of equity share: Please refer to Note 8.

14. Segment Information

(1) General information

For management purpose, the Group separated operating units based on business which operates individually from the main business in each region. The Group was divided into the following two reportable segments:

~56~

A. IC semiconductor group: This segment mainly provides IC packaging and testing services.
B. Electronics manufacturing services group: This segment provides professional electronics manufacturing services.

(2) Segment information

Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profit or loss and is measured consistently with operating profit or loss in the consolidated financial statements. However, finance costs, finance income and income taxes in the consolidated financial statements are managed on a group basis and are not allocated to operating segments.

The segment information provided to the chief operating decision-maker for the reportable segments is as follows:

	Three months ended March 31,2023	Three months ended March 31,2023	Three months ended March 31,2023
IC semiconductor group 2,063,876 $ - 2,063,876 $ 106,253 $	Reconciliation and Electronics manufacturing All other write-offs servicesgroup segments (Notes 1 and 2) 1,189,535 $ - $ - $ 55,983 - 55,983) ( 1,245,518 $ - $ 55,983) ($ 9,311) ($ 1,653 $ 846) ($ Three months ended March 31, 2022			Total
$ $				3,253,411 $ -
				3,253,411 $ 97,749 $
$

IC semiconductor group 2,586,920 $ - 2,586,920 $ 418,203 $	Electronics manufacturing servicesgroup 1,251,980 $ 50,758 1,302,738 $ 65,454 $	All other segments - $ - - $ 3,255 $	Reconciliation and write-offs (Notes 1 and 2) - $ 50,758) ( 50,758) ($ 20,937) ($	Total
				3,838,900 $ -
				3,838,900 $ 465,975 $

Note 1: Inter-segment revenue has been written-off when preparing the consolidated financial statements. Note 2: Income or loss for each operating segment does not include income tax expense.

(3) Reconciliation for segment income (loss)

Sales between segments are carried out at arm’s length. The revenue from external customers reported to the chief operating decision-maker is measured in a manner consistent with that in the statement of comprehensive income.

~57~

Expressed in thousands of NTD (Except as otherwise indicated)

Table 1

Orient Semiconductor Electronics, Limited and Subsidiaries Loans to others

Three months ended March 31, 2023

Maximum outstanding Collateral Is a balance during the Amount of Reason for Allowance Limit on loans Ceiling on total General ledger related three months ended Balance at Actual amount Interest transactions with shortfor doubtful granted to a single loans granted No. Creditor Borrower account party March 31, 2023 March 31, 2023 drawn down rate range Nature of loan the borrower term financing accounts Item Value party (Note) (Note) Footnote 1 COREPLUS (HK) Valve-Plus Technology Other Y 30,440 30,440 10,654 - Short-term - Short-term - - - 610,687 610,687 - LIMITED (Suzhou) Co. receivables due (USD 1,000) (USD 1,000) (USD 350) financing capital (USD 20,062) (USD 20,062) from related requirements parties for operating and business purposes

Note: In accordance with the Company’s “Procedures for Provision of Loans”, limit on loans to others is 40% of the Company’s net asset based on the latest audited or reviewed consolidated financial statements.

However, limit on loans to direct or indirect wholly-owned foreign subsidiaries of the Company is 200% of the Company’s net asset. Limit on endorsements to a single party is 30% of the Company’s net asset based on the latest audited or reviewed financial statements.

Table 1, Page 1

Orient Semiconductor Electronics, Limited and Subsidiaries

Table 2

Provision of endorsements and guarantees to others

Three months ended March 31, 2023

Expressed in thousands of NTD (Except as otherwise indicated)

No. (Note 1)	Endorser/guarantor	Partybeingendorsed/guaranteed	Partybeingendorsed/guaranteed	Limit on endorsements/ guarantees provided for a single party (Note 3)	Maximum outstanding endorsement/ guarantee amount as of March 31,2023	Outstanding endorsement/ guarantee amount at March 31,2023	Actual amount drawn down	Amount of endorsements/ guarantees secured with collateral	Ratio of accumulated endorsement/ guarantee amount to net asset value of the endorser/guarantor	Ceiling on total amount of endorsements/ guarantees provided(Note 3)	Provision of endorsements/ guarantees by parent company to subsidiary	Provision of endorsements/ guarantees by subsidiary to parent company	Provision of endorsements/ guarantees to the party in Mainland China	Footnote
		Companyname	Relationship with the endorser/ guarantor
0	Orient Semiconductor Electronics, Limited	COREPLUS (HK) LIMITED	Note 2	3,044,232 $	$ 76,100 (USD 2,500)	$ 76,100 (USD 2,500)	$ 10,654 (USD 350)	$ -	0.75%	10,147,440 $	Y	N	N	-

Note 1: The numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows:

(1)The Company is ‘0’.

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

Note 2: The endorser/guarantor parent company owns directly and indirectly more than 50% voting shares of the endorsed/guaranteed subsidiary.

Note 3: Limit on total endorsements is the Company’s net asset based on the latest audited or reviewed financial statements, and limit on endorsements to a single party is 30% of the Company’s net asset based on the latest audited or reviewed financial statements.

Table 2, Page 1

Orient Semiconductor Electronics, Limited and Subsidiaries

Table 3

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

March 31, 2023

Expressed in thousands of NTD

(Except as otherwise indicated)

Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As of March31,2023	As of March31,2023		Footnote
				Number of shares	Bookvalue	Ownership (%)	Fairvalue
Orient Semiconductor Electronics,Limited Orient Semiconductor Electronics,Limited Orient Semiconductor Electronics,Limited Orient Semiconductor Electronics,Limited Orient Semiconductor Electronics,Limited Hua-Cheng Investment Co.	STRATEDGE’s stocks - common shares SPINERGY’s stocks - common shares Golfware’s stocks - common shares SCREENBEAM’s stocks - common shares SCREENBEAM’s stocks - preference share Chipbond Technology Corporation	None None None None None Entity with significant influence	Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current	5,135 999,641 4,687 2,141,176 2,352,941 18,779,000	- $ - - 2,683 7,930 1,301,385	- - - - - 2.54%	- $ - - 2,683 7,930 1,301,385	- - - - - -

Table 3, Page 1

Orient Semiconductor Electronics, Limited and Subsidiaries

Table 4

Expressed in thousands of NTD (Except as otherwise indicated)

Significant inter-company transactions during the reporting periods

Three months ended March 31, 2023

Transactions amount between the parent company and subsidiaries or between subsidiaries reaching $10 million is provided below:

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledger account	Amount	Transaction terms	Percentage of consolidated total operatingrevenues or total assets
0 0 1 1 2 2	Orient Semiconductor Electronics,Limited Orient Semiconductor Electronics,Limited COREPLUS (HK) LIMITED COREPLUS (HK) LIMITED Valve-Plus Technology (Suzhou) Co. Valve-Plus Technology (Suzhou) Co.	COREPLUS (HK) LIMITED OSE INTERNATIONAL LTD. Orient Semiconductor Electronics,Limited Valve-Plus Technology (Suzhou) Co. COREPLUS (HK) LIMITED COREPLUS (HK) LIMITED	1 1 2 3 3 3	Accounts receivable Other payables Sales revenue Other receivable Sales revenue Accounts receivable	31,113 $ 77,960 61,887 10,877 30,744 13,385	- - Same with general transaction terms - Same with general transaction terms -	0.19% 0.48% 1.90% 0.07% 0.94% 0.08%

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

(1) Parent company is ‘0’.

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

Note 2: Relationship between transaction company and counterparty is classified into the following three categories; fill in the number of category each case belongs to (If transactions between parent company and subsidiaries

or between subsidiaries refer to the same transaction, it is not required to disclose twice. For example, if the parent company has already disclosed its transaction with a subsidiary, then the subsidiary is not required to disclose the transaction;

for transactions between two subsidiaries, if one of the subsidiaries has disclosed the transaction, then the other is not required to disclose the transaction.):

(1) Parent company to subsidiary.

(2) Subsidiary to parent company.

(3) Subsidiary to subsidiary.

Table 4, Page 1

Orient Semiconductor Electronics, Limited and Subsidiaries

Information on investees

Three months ended March 31, 2023

Table 5

Expressed in thousands of NTD (Except as otherwise indicated)

Investor	Investee	Location	Main business activities	Initial investment amount	Initial investment amount	Shares held as at March 31,2023	Shares held as at March 31,2023	Shares held as at March 31,2023	Net profit (loss) of the investee for the three months ended March 31,2023	Investment income (loss) recognised by the Company for the three months ended March 31, 2023	Footnote
				Balance as at March 31,2023	Balance as at March 31,2022	Number of shares	Ownership (%)	Book value
Orient Semiconductor Electronics, Limited Orient Semiconductor Electronics, Limited Orient Semiconductor Electronics, Limited Orient Semiconductor Electronics, Limited Orient Semiconductor Electronics, Limited Orient Semiconductor Electronics, Limited OSE INTERNATIONAL LTD.	OSE PHILIPPINES, INC. OSE PROPERTIES, INC. OSE INTERNATIONAL LTD. SCS HIGHTECH INC. COREPLUS (HK) LIMITED HUA-CHENG INVESTMENT CO. OSE PHILIPPINES, INC.	Philippines Philippines British Virgin IS. Taiwan Hong Kong Taiwan Philippines	(1) Integrated circuits and various semiconductor components (2) Research, design, manufacture, assembly, processing and test of abovementioned products and after-sales service (1) Sales of properties (2) Lease of properties (3) Other property-related business Investments of various manufacturing businesses Manufacture of data storage and processing equipment and providing information software and data processing services Procure to order and components assembly outsourcing Reinvestments in various business (1) Integrated circuits and various semiconductor components (2) Research, design, manufacture, assembly, processing and test of abovemetioned products and after-sales service	$ 3,938,187 (USD 129,375,408) 9,301 (USD 305,559) 487,040 (USD 16,000,000) 256,000 228,300 (USD 7,500,000) 1,508,254 152,200 (USD 5,000,000)	$ 3,938,187 (USD 129,375,408) 9,301 (USD 305,559) 487,040 (USD 16,000,000) 256,000 228,300 (USD 7,500,000) 1,508,254 152,200 (USD 5,000,000)	3,680,365 7,998 16,000,000 25,600,000 7,500,000 248,986,874 248,660	93.67% 39.99% 100% 18.17% 100% 100% 6.33%	524) ($ 1,704 323,940 - 305,282 1,710,613 35) (	13,681 $ 416) ( 790 - 14,488) ( 863 13,681	12,815 $ 167) ( 790 - 14,488) ( 863 866	Note 1 Note 1 Note 2 Note 1 Note 1 Notes 1 and 3

Note 1: Inter-company transactions between companies within the Group are eliminated.

Note 2: The investee was abolished on March 8, 2007.

Note 3: Initial investment amount of the reinvestee which use foreign currencies to prepare financial statements is translated to NTD at the spot rate at the period end.

Table 5, Page 1

Orient Semiconductor Electronics, Limited and Subsidiaries Information on investments in Mainland China

Table 6

Expressed in thousands of NTD (Except as otherwise indicated)

Three months ended March 31, 2023

Investee in Mainland China	Main business activities	Paid-in capital	Investment method(Note 1)	Accumulated amount of remittance from Taiwan to Mainland China as of January 1,2023	Amoun Taiwan to Amount remitte threemonths e	t remitted from Mainland China/ d back to Taiwan for the ndedMarch31,2023	Accumulated amount of remittance from Taiwan to Mainland China as of March31,2023	Net income of investee as of March31,2023	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the three months ended March 31, 2023	Book value of investments in Mainland China as of March31,2023	Accumulated amount of investment income remitted back to Taiwan as of March31,2023	Footnote
					Remitted to MainlandChina	Remitted back to Taiwan
Valve-Plus Technology (Suzhou) Co.	Researching, developing and undertaking the substrate surface adhesion processing of various electronic product components, plug-in welding processing of components, related testing, combination processing, sales of self-produced products, and providing technique maintenance and after-sale service accordingly	165,428 (USD 5,388,522)	Investment and establishment in COREPLUS, and then reinvestment (2)	158,328 $	$ -	$ -	158,328 $	9,940) ($	100%	9,940) ($	46,557 $	$ -	Note 3

Companyname	Accumulated amount of remittance from Taiwan to Mainland China as of March 31,2023	Investment amount approved by the Investment Commission of the Ministry of Economic Affairs (MOEA)	Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA	Footnote
Orient Semiconductor Electronics, Limited	$ 158,328	$ 175,495	$ 6,088,464	Note 3

Note 1: Investment methods are classified into the following three categories;

(1) Directly invest in a company in Mainland China.

(2) Through investing in an existing company in the third area, which then invested in the investee in Mainland China.

Note 2: Limit amount prescribed by the Jing-Shen-Zi Letter No. 09704604680 of Ministry of Economic Affairs, dated August 29, 2008, and is calculated based on 60% of the Company’s consolidated net assets.

Note 3: Paid-in capital was translated to NTD at the spot rate at the period end.

Table 6, Page 1

Orient Semiconductor Electronics, Limited and Subsidiaries

Significant transactions conducted with investees in Mainland China directly or indirectly through other companies in the third areas

Three months ended March 31, 2023

Table 7

Expressed in thousands of NTD (Except as otherwise indicated)

Investee in Mainland China	Sale(purchase)	Sale(purchase)	Service re	venue	Accounts receivable (payable)	Accounts receivable (payable)	Other receivables	Other receivables	Provision of endorsements/guarantees or collaterals	Provision of endorsements/guarantees or collaterals		Financing	Financing		Other
	Amount	%	Amount	%	Balance at March 31,2023	%	Balance at March 31,2023	Purpose	Balance at March 31,2023	Purpose	Maximum balance during the three months ended March 31,2023	Balance at March 31,2023	Interest rate	Interest during the three months ended March 31,2023
Valve-Plus Technology (Suzhou) Co.	$ -	-	$ 30,744	100%	$ 13,385	99%	$ 673	47%	$ -	-	$ 30,440	30,440 $	-	- $

Table 7, Page 1

Orient Semiconductor Electronics, Limited and Subsidiaries

Table 8

Major shareholders information

March 31, 2023

Name of majorshareholders	Shares	Shares
	Numberofsharesheld	Ownership (%)
Chipbond Technology Corporation	163,995,498	29.53%

Note: Chipbond Technology Corporation held the Company’s common shares and class B and class C preferred shares without voting rights amounting to 163,995,498 shares, 90,090,000 shares and 180,180,000 shares, respectively, and in total held 434,265,498 shares.

Table 8, Page 1

AI assistant

OSE — Interim / Quarterly Report 2023

52010_rns_2023-12-01_a6cf5993-1dc6-41d0-9cfd-eade7cd30e3d.pdf

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES

INDEPENDENT AUDITORS’ REVIEW REPORT TRANSLATED FROM CHINESE

Introduction

Scope of review

Basis for qualified conclusion

Qualified conclusion

Wang, Kuo-Hua[Chiang, Tsai-Yen ]

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS MARCH 31, 2023, DECEMBER 31, 2022 AND MARCH 31, 2022

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS MARCH 31, 2023, DECEMBER 31, 2022 AND MARCH 31, 2022

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME THREE MONTHS ENDED MARCH 31, 2023 AND 2022

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY THREE MONTHS ENDED MARCH 31, 2023 AND 2022

Three months ended March 31, 2022

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2023 AND 2022

ORIENT SEMICONDUCTOR ELECTRONICS, LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2023 AND 2022

ORIENT SEMICONDUCTOR ELECTRONICS LIMITED AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2023 AND 2022

1. History and Organisation

3. Application of New Standards, Amendments and Interpretations

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

4. Summary of Significant Accounting Policies

(1) Compliance statement

(2) Basis of preparation

(3) Basis of consolidation

(4) Employee benefits

(5) Income taxes

5. Critical Accounting Judgements, Estimates and Key Sources of Assumption Uncertainty

6. Details of Significant Accounts

(1) Cash and cash equivalents

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

(3) Financial assets at amortised cost

(4) Notes and accounts receivable (including related parties)

(5) Inventories

(6) Investments accounted for using equity method

(7) Property, plant and equipment

A.Property, plant and equipment for self-use

B. Property, plant and equipment for operating lease

B. The carrying amount of right-of-use assets and the depreciation charge are as follows:

(9) Leasing arrangements - lessor

B. Gain arising from operating lease agreements are as follows:

(10) Intangible assets

(13) Other payables

- (14) Long term borrowings

(15) Pensions

(16) Preference share liability

(19) Capital surplus

(20) Retained earnings

(21) Operating revenue

A. Disaggregation of revenue from contracts with customers

(22) Interest income

(23) Other income

(24) Other gains and losses

(25) Finance costs

(28) Income tax

(29) Earnings per share

Three months ended March 31, 2022

(30) Supplemental cash flow information

A. Investing activities with partial cash payments:

B. Investing and financing activities with no cash flow effects ：

(31) Changes in liabilities from financing activities

7. Related Party Transactions

(1) Names of related parties and relationship

(2) Significant related party transactions

A. Sales

B. Purchases:

C. Receivables from related parties:

D. Payables to related parties:

E. Property transactions:

Disposal of property, plant and equipment:

－ F. Lease transactions lessor

G. Loans to/from related parties:

(3) Key management compensation

8. Pledged Assets

9. Significant Contingent Liabilities and Unrecognised Contract Commitments

(1) Contingencies

(2) Commitments

OSE Interim / Quarterly Report 2023

B. Investing and financing activities with no cash flow effects `：`

`－` F. Lease transactions lessor