PSC - Annual Report 2021 | FinancialReports.eu

Stock Code: 2855 www.pscnet.com.tw

2021 ANNUAL REPORT

Notice to readers

This English-version annual report is a summary translation of the Chinese version and is not an official document of the shareholders’ meeting. If there is any discrepancy between the English and Chinese versions, the Chinese version shall prevail.

2021 Annual Report is available at: Taiwan Stock Exchange Market Observation Post System http://mops.twse.com.tw/

Table of Content
I. A Letter to Shareholders	1
II. Company Profile	3
III. Corporate Governance	5
Business Organization	5
Directors’, Supervisors’ and Managers’ Information	7
Implementation of Corporate Governance	34
Information Regarding the Company’s Audit Fee and Independent Auditor	89
Replacement of CPA	89
Information Regarding the Company’s Chairman, President, or managers responsible for financial and
accounting affairs who have held any position in the accounting firm or its affiliates	89
Net Change in shareholdings and in shares pledged by directors, supervisors, manages, and shareholders
holding more than a 10% share in the Company	90
Information Disclosing the Relationship between any of the Company’s Top Ten Shareholders	93
Ownership of Shares in Affiliated Enterprises	94
Name and position of the employees with the top ten amounts of bonuses as well as the total amounts
of the top ten bonuses	94
Training of Directors and Supervisors	95
Manager Learning	99
IV. Capital Structure	101
Shareholders’ equity	101
Long-Term Borrowings	105
Issuance of Preferred Stocks	105
Issuance of Global Depositary Receipts	105
Issuance of Employee’s Stock Options	105
Merge and Acquisition	105
Working Capital Plans	105
V. Business Environment	106
Description of Business Activities	106
Market Conditions	124
Employee Data	129
Environmental Protection and Corporate Citizenship	129
Labor Relations & Employee Benefit	131
Information and Communication Security Management	139
Material Contracts and Agreements	141

VI. Financial Information	142
Five-Year Financial Summary	142
Financial Analysis for the Past Five Years	146
Audit Committee’s Review Report on the Company’s 2021 Financial Statement	149
Financial Difficulties that will Affect the Company’s Financial Situation	150
Status of the Achievement in Financial Forecasts for the Latest Two Years	150
Methods and Assumptions used for Evaluating Fair Value of Financial Instruments	150
Hedge Accounting Applied to Financial Instruments	150
VII. Financial Status, Operating Results and Risk Management	151
Financial Status	151
Analysis of Operating Results	151
Analysis of Cash Flow	152
Effects of Major Capital Expenditures in the Most Recent Fiscal Year on Financial Operations	153
Long-term Investment Policy	153
Analysis of Risk Management	153
Other significant events	163
VIII. Other Disclosures	164
Consolidated Business Report of Affiliated Companies, Consolidated Financial Statements of Affiliated
Companies, and Reports of Affiliation	164
Private placement of marketable securities	166
Holding or disposal of the company’s shares by the subsidiaries	167
Other Necessary Supplement	167
IX. Occurrences of items that may give rises to substantial impact on shareholders’
interests and/or stock price	168
X. Financial Statements	169

I. A Letter to Shareholders

Dear Shareholders,

With the popularity of COVID vaccines in 2021, countries around the world have gradually lifted domestic restrictions, which caused the recovery of global demand and economy. In the U.S., policies encouraged people to get vaccinated, eased containment measures and boosted consumption recovery. However, the slow job market recovery and the supply chain crisis have led to the continuous inflation. In Europe, the pandemic went into remission due to vaccination. Various industries gradually recovered, coupled with the implementation of fiscal policies, the economy was led to a rebound. However, the spread of the Omicron variant at the end of the year and the rising tension between Russia and Ukraine have brought uncertainty to the economy. In China, large scale reforms were implemented in certain industries such as supplementary education, financial technology, online gaming and real estate, which affected market investors’ confidence. Domestically, according to the Directorate-General of Budget, Accounting and Statistics of the Executive Yuan, the economic growth rate increased from 3.36% in 2020 to 6.45% in 2021, which was mainly due to the gradual loosening of containment measures in European and American countries. The above led to an increase in end demand, coupled with the buoyant demand for 5G, high performance computing, Internet of Things and automotive electronics, which boosted the investment in the semiconductor and automotive electronics industries and resulted in economic growth. In the Taiwan stock market, benefited from the continuous quantitative easing policies in Europe countries and the United States, the market liquidity became high. The global economic recovery, tight shipping capacity and robust demand in the semiconductor industry, TAIEX increased from 14,732 points to 18,218 points, representing an increase of 23.7%. Market trading volume also greatly increased. Total average trading volume in all listed markets increased from NT$253.5 billion to NT$477.8 billion, which is an increase of 188.5%.

The Company had outstanding performance in 2021, with annual operating income of NT$10,578,004 thousand, operating costs of NT$672,687 thousand, operating expenses of NT$5,642,642 thousand, non-operating net income of NT$370,104 thousand, net income before tax NT$4,632,779 thousand, and net income after tax NT$4,007,435 thousand. Net income per share after tax reached record high of NT$2.75.

In brokerage business, the market share in 2021 was 3.17%. Although it decreased comparing to the previous year, the trading in stock market was hot with surging trading volume and financing balance, resulting in a remarkable profit. In view of the trend of digital marketing, the Company also actively invested in the establishment of digital and mobilerelated services and platforms to strengthen the operation of social media, hoping to enhance customer satisfaction.

In terms of the underwriting business, the Company served as the lead underwriter for 18 cases and the co-underwriter for 40 cases throughout the year; the total value of underwriting was NT$8,523 million. The Company filters cases under strict standard and emphasizes industry prospects and credit risks. With the highly experienced team, the Company intends to provide high-quality underwriting services to assist clients to achieve their goals, including going public, raising funds in the primary market, private placement, or M&A.

In terms of stock proprietary trading business, the Taiwan stock market raised thanks to the recovery of the global economy. The proprietary trading team captured the dynamics of the stock market, achieved brilliant performance, and became the largest contributor to profits for the Company. In respect of the bond proprietary trading business, the market expects that the Central Bank’s monetary policy will be normalized, which will drive up market interest rates, making it difficult to manage positions and resulting in poor performance. The Company will adjust the pace and carefully respond to future interest rate hikes. In the futures proprietary trading business, the Company fully uses econometrics to seek profit-making opportunities across products, time zones, and markets. In respect of the financial products business, the Company newly issued two new ETNs “President Asia Semiconductor” and “President Smart Electric Vehicle” in 2021. The Company gradually expanded the product range and planned financial products that meet market demands. The two ETNs “President Special Selection value growth 30” and “President Special Selection Taiwan 5G” that issued earlier have won the 18th National Brand Yushan Award in the Best Product Category.

The Company continues to promote the service concept of fair treatment, focus on customer experience, pay attention to customer opinions, continue to optimize service flow, and implement the principle of fair treatment to achieve sustainable operation and development of the Company. The Company has set up a fair treatment principle working group, which is supervised and promoted by the senior executives, and regularly reports the implementation of the principle of fair

President Securities Corporation

treatment to the Board of Directors to ensure the principle is put into effect. The Company won significant progress award in the 2021 FSC principle of fair treatment assessment. From risk-management perspective, the Company continuously strives to improve the overall risk-management mechanism and strengthens customer risk management, so that all business activities can be developed in a safe and stable environment. The Company’s outstanding performance and market position have also been recognized by Taiwan Ratings. In 2021, the Company was granted “twA” and “twA-1” for long-term and short-term credit rating, respectively, with a rating outlook of “stable”.

In terms of corporate social responsibility, the Company actively participated in community care and have cooperated with Child Welfare League Foundation in assisting underprivileged children for a long period of time and thus received TSAA (Taiwan Sustainability Action Award) Bronze Award. In order to enhance information transparency, the Company has prepared the “Corporate Social Responsibility Report”, which discloses the achievements of corporate governance, environmental sustainability and social co-prosperity. The Company participated in the “TCSA Taiwan Sustainability Award” selection in 2021 and was awarded two awards: “Corporate Sustainability Reporting Category – Financial and Insurance Group Gold Award” and “Outstanding Taiwan Sustainable Corporate Award”.

Looking forward to 2022, with the progress of vaccination and improved treatment against COVID, the impact of the pandemic is expected to gradually slow down, and employment and end-point demand will continue to recover. However, due to supply chain bottlenecks, the impact of China’s lock down and Russia-Ukraine war, energy and material prices will be driven up. The likelihood of the US Fed continuing to adopt a tight monetary policy will be increased, and the global stock and bond market will be impacted, which will be a critical factor to restrain economic growth. In contrast to the domestic economy, despite the Omicron variant community spread cases, the majority of the confirmed cases only have mild symptoms, and the anti-pandemic control measures have been gradually moved towards the direction of co-existence with the virus and roll-planning adjusting with time in order to reduce the impact on the economy. The Directorate-General of Budget, Accounting and Statistics estimates that the economic growth rate will reach 4.42% this year.

In the face of uncertainties in the future, President Securities Corporation’s management team will adhere to the longterm and stable operation strategy, strive and improve continuously, implement the risk management and internal control mechanism, strengthen the operation quality of the Company and enhance the competitiveness of various businesses. The Company expects to provide customers with comprehensive products and services and sound quality customer experience, so as to maximize the value of the Company and its shareholders.

I hereby extend my most sincere gratitude to our shareholders for your long-term trust and support of President Securities. I wish you all good health and prosperity.

Chairman: Lin, Kuan-Chen President: Tsai, Sen-Bu

2021 Annual Report

II. Company Profile

Incorporated

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1988 1991 1995
President Securi�es Co., Ltd. was incorporated Merged with Tung-Hsin, Tung-Yung, Increased capital to NT$7.03 billion.
through the memorandum of Securi�es and Futures Commission, Ministry of Finance with the le�er No. (77) Taiwan-Finance-Securi�es-(II)- Tung-Wen, Tung-Ku, Tung-Fu, Tung-Yu, Tung-Hsing, Tung-Wang, Tung-Lai securi�es agencies. Became the first Asian securi�es company to acquire the ISO9002 service quality cer�fica�on.
20093 in November 19th. Established new branches in SanMin, Xin Taichung,
Founding capital of NT$1.4 billion increased and Hsinying, bringing the total number of branches
to actual paid-in capital of NT$3.362 billion to 16.
a�er the merger.
Amended business name to President Performed capital infusion; capital stock Established new branches in
Securi�es Corp. on March 4th. a�er infusion amounted to NT$4.02 Yenping, Taoyuan, Sanchung,
Commencement of official opera�ons on billion. Tunghsing, and Fengyuan.
April 3rd.
1996
1989 1994
2009 2007
Executed capital reduc�on through Long-term credit ra�ng was upgraded from twA-
cancella�on of treasury stock, capital to twA, and short-term credit ra�ng was
stock a�er asset reduc�on amounted to upgraded from twA-2 to twA-1.
NT$11.857 billion. Converted retained earnings to paid-in capital,
capital stock a�er infusion amounted to
NT$11.768 billion.
Obtained trust business license issued by FSC. Issued the first unsecured conver�ble corporate bond in Taiwan, and received NT$ 3 billion from the offering in May.Established PSC Xiamen business office in China on August 22nd.
Converted retained earnings to paid-in
capital, capital stock a�er infusion Converted retained earnings to paid-in capital, capital stock a�er
amounted to NT$12.319 billion. infusion amounted to NT$12.157 billion.
2010 2008
2012 2014
Converted retained earnings to paid-in Established an Offshore Securi�es Unit (OSU) in July .
capital, capital stock a�er infusion Established new branches in Xinzhuang, Zhubei,
amounted to NT$13.231 billion. Zhunan, and Xin Taoyuan, bringing the total number
of branches to 39.
Acquired the brokerage business of Standard
Chartered Bank in Taiwan.
Established remunera�on Commi�ee.
The total branches remain 35 (including head office.) . Established an Audi�ng Commi�ee in
Converted retained earnings to paid-in capital. The June.
capital stock a�er infusion amounted to NT$13.046 Opened a new branch in Pingzhen,
billion. bringing our total number of branches to
Conducted a capital reduc�on by cancelling treasury 40 (Including our headquarters) in
stocks in December. The capital became NT$12.845 October.
billion.
2015
2011 2013
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President Securities Corporation

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1998 2000
Executed capital infusion; capital stock In August, acquired Ta Feng Securi�es Co., Ltd.
a�er infusion amounted to NT$10.18
Converted retained earnings to paid-in capital,
billion in May. capital stock a�er infusion amounted to
NT$12.255 billion.
Executed capital infusion; capital stock a�er Obtained official approval for OTC lis�ng.
infusion amounted to NT$8.08billion. Converted retained earnings to paid-in Executed capital reduc�on through
Established new branches in Tianmu, Banqiao, Hankou, Tali, and Sanduo. The capital, capital stock a�er infusion amounted to NT$10.91 billion. cancella�on of treasury stock, capital stock a�er asset reduc�on amounted to
business offices were increased to 26 Rated as “twBBB” and “twA-3” for long-term NT$11.279 billion.
(including head office). and short-term credits, respec�vely, by
Taiwan Ra�ng Corp.
1997 1999 2001
2006 2003
Obtained business license for wealth management.
Received the 6th annual Na�onal Charity Award, Obtained business license for structured
and was the only for-profit business en�ty among notes; Fixed Income business unit
twelve recipients. licensed as the main dealer for business
opera�on of government bonds issued by
Executed capital reduc�on through cancella�on of Central Bank of the Republic of China.
treasury stock, capital stock a�er asset reduc�on
amounted to NT$11.37 billion.
Opened East Tainan Branch, Neihu Branch and Renai Branch. The
business offices increased to 35 (including head office). Listed on TWSE in September.
Long term credit ra�ng was upgraded from twBBB to twBBB+ in Executed capital reduc�on through
September, and was again upgraded to twA- in December. cancella�on of treasury stock, capital
Executed capital reduc�on through cancella�on of treasury stock, stock a�er asset reduc�on amounted to
capital stock a�er asset reduc�on amounted to NT$11.4499 billion. NT$11.46 billion.
2004 2002
2016 2019
Conducted a capital reduc�on by canceling treasury stocks in Conducted a capital reduc�on by cancelling treasury stocks in May. A�er the
February and May. The capital became NT$13.037 billion and capital reduc�on, the total share capital was around NT$13.723 billion; at that
NT$12.952 billion. �me business was terminated at Xindian Branch, bringing the number of branches
to 35. Business was terminated at Xinzhuang Branch in July, so that the number of
Converted earnings to paid-in capital in August, growing the capital
to NT$13.356 billion. ac�ve branches declined to 34. The Fengyuan, Ku�ng, and Xin Taoyuan branches
were closed for business in November, so that the number of branches declined to
The branches in Tali, Yenping, and SanMin terminated opera�ons in 31, including the Head Office.
October , causing that the total number of branches reduced to
37(including our headquarters).
In August, a capitaliza�on of earnings was
The branch in Zhubei terminated opera�ons conducted. A�er an increase in capital,
in May, causing that the total number of the share capital was NT$13.98 billion. In
branches reduced to 36(including our September, the first cross-strait joint
headquarters). venture securi�es firm, Jin Yuan President
The Company transferred earnings to paid-in capital in August. The capital a�er capital Securi�es Corpora�on Limited, was officially opened.
increase was NT$13.904 billion.
2017 2020
In September, a capitaliza�on of
earnings was conducted. A�er
an increase in capital, the share
capital was NT$14.558 billion.
2021
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2021 Annual Report

III. Corporate Governance

I. Business Organization

A. Organizational Chart

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Administration Dept.
Shareholders’ Meeting
Finance Dept.
Board of Directors
Information System Dept.
Audit Committee
Risk Management
Committee Settlement & Clearing Dept.
Risk Control Office
Remuneration
Committee Financial Product Dept.
Ethical Corporate
Auditing Office
Management Practice
Team Proprietary Trading Dept.
Chairman of the Board
Fixed Income Dept.
President
Capital Market Dept.
Corporate Client Dept.
Assets & Liabilities
Management Committee
Quantitative Trading Dept.
President Office
Shareholder Services Dept.
Compliance Division
Wealth Management and
Trust Dept.
Brokerage Dept.
Global Institutional
Service Dept.
Offshore Securities Unit
Digital Business Department
E-Trade Department
Branches
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President Securities Corporation

B. Function of Each Division

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Division Function
 Accept orders from clients to buy/sell listed securities and forward to TWSE for execution.
 Accept orders from clients to buy/sell listed securities and forward to TPEx for execution.
 Manage custodial services for clients.
 Provide margin financing for securities trading.
 Securities Borrowing and Lending Business.
Brokerage  Borrowing or Lending Money in Connection with Securities Business
 Conduct Borrowing and Lending of Funds for Unrestricted Purposes.
 Accepting orders to trade Foreign Securities.
 Futures Introducing Broker Business.
 Electronic transaction operations.
 Customer service coordination process.
 Issue domestic and foreign equity warrants and conduct hedging strategies.
 Launch structured products and conduct hedging strategies.
 Trading of equity derivatives.
Financial  Exchange-traded Note (ETN) Issuance and Hedging Operations.
Products  New financial product design and development.
 Future and spot trading strategy.
 Stock market maker business.
 Other derivatives financial products approved by the competent authority.
 Trading of publicly listed securities on the TWSE and TPEx, using President Securities’ own funds.
Proprietary  Trade futures and options markets as a futures trader.
Trading  Expand international investment business involving legally-permitted overseas spot/futures market
research and investments.
 Use own capital to trade domestic and foreign corporate and government bonds in the OTC market.
 Offer tendering services of Taiwan government bonds.
 Repo and Reverse-Repo transactions.
 Trade overseas and domestic convertible bonds.
 Provide debt capital market services for overseas and domestic issuers.
Fixed Income
 Provide financial market services and product to financial institutions and corporate clients.
 Provide customized structured products for clients.
 Designed Bond Exchange-Traded Notes.
 Securities-related spot foreign currency transaction business.
 Execute foreign currency funding business between NTD and foreign currencies.
 Assist corporations in application for public listing on TWSE or TPEx.
 Assess and advise clients with respect to capital increase plans and applications to convert private
Capital Market equity into publicly traded stocks.
(Underwriting)  Underwrite domestic and foreign corporate bonds and foreign financial products.
 Assist in M&A activities; provide consulting services on corporate finance and other specialized areas.
 Other various types of underwriting business and financial advisory business.
 Market making and trading of futures and options contracts on the TAIFEX.
 Market making and trading of legally-permitted foreign futures and options contracts.
Quantitative  ETF arbitrage, market making, hedging, and trading.
Trading  Spot and futures arbitrage and trading.
 Structured products issuing and trading.
 Spread and volatility arbitrage of domestic and foreign futures/options products.
 Coordinate shareholder services on behalf of publicly listed companies.
 Assist in the coordination of shareholders’ meetings.
Shareholder
 Coordinate the distribution of cash and/or stock dividends to shareholders.
Services
 Manage the issuance and delivery of tax forms to shareholders.
 Respond to shareholder enquiries and legal issues.
 Provide consulting or selling services such as wealth management product asset allocation and financial
planning.
 Provide a variety of trading services and products for wealth management, including domestic and
overseas funds, foreign bonds, structured products, and bonds with repurchasing agreements.
Wealth  Conduct asset allocation for customers through trusts.
Management &  Negotiable securities trust lending business.
Trust
 Employee Stock Ownership Trust business.
 Settlement Operations.
 Engage in the wealth management business for high asset clients.
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2021 Annual Report

II. Directors’, Supervisors’ and Managers’ Information

A. Directors

1. Information Regarding Directors

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April 25, 2022
Executives, Directors or
Shareholding
Shareholding when Spouse & Minor Supervisors Who are Spouses
Title Nationality Name ElectedDate Gender/age (Until)Term Date (FirstElected) Elected Current Shareholding Shareholding Arrangementby Nominee Experience (Education) Current Position with PSC and Other Company or within Two Degrees of Kinship
Shares % Shares % Shares % Shares % Title Name Relation
Kai Nan
Investment 2021.7.20 2024.7.19 2000.6.8 40,628,089 2.79 42,253,121 2.90 0 0 0 0 NA NA NA NA NA
Co., Ltd.
1. National Taiwan Sport University 1. PSC: NA
2. Vice Chairman and President of President 2. Other Company:
Securities Corporation
• Chairman:
3. Chairman of President Futures Corp. Richness Cereal Trading Co., Ltd.
Chairman 4. Director of Taiwan Futures Exchange • Director:
Republic of China Lin, Kuan-Delegate: 2021.7.20 61~70M/ 2024.7.19 2018.6.21 3,100,000 0.21 3,224,000 0.22 1,060,800 0.07 0 0 5. Chairman of Richness Cereal Trading Co., Ltd. President Futures Corp., Taiwan Futures Exchange, Q-WARE Systems NA NA NA
Chen 6. Director and President of Fonmau Cereal & Services Corp., President Securities (HK) Ltd., President Securities
Industrial Co., Ltd. (Nominee) Ltd., President Wealth
7. Director of Q-WARE Systems & Services Management (HK) Ltd., Jin Yuan
Corp. President Securities Ltd.
8. Director of President Securities Corporation • Director and President:
Fonmau Cereal Industrial Co., Ltd.
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Executives, Directors or
Shareholding
Shareholding when Spouse & Minor Supervisors Who are Spouses
Title Nationality Name ElectedDate Gender/age (Until)Term Date (FirstElected) Elected Current Shareholding Shareholding Arrangementby Nominee Experience (Education) Current Position with PSC and Other Company or within Two Degrees of Kinship
Shares % Shares % Shares % Shares % Title Name Relation
Kai Nan
Investment 2021.7.20 2024.7.19 2000.6.8 40,628,089 2.79 42,253,121 2.90 0 0 0 0 NA NA NA NA NA
Co., Ltd.
1. Ph.D. in Finance, National Chung Hsing 1. PSC: NA
University, R.O.C.
2. Other Company:
2. MBA of National Taiwan University,
R.O.C. • Vice President:
3. Manager of President International Uni-President Enterprises Corp.
Development Corp. • President:
4. Manager of Uni-President Enterprises Champ Green (Shanghai) Consulting
Corp., Treasury Division Co., Ltd.
5. Vice President of Uni-President Enterprises • Director and President:
Corp., Business Integration Division
United Advisor Venture Management
6. Director of President Securities Corporation Ltd.
7. Director of President International • Director:
Development Corp.
President International Development
8. Director of Presco Netmarketing, Inc. Corp., Presco Netmarketing, Inc.,
9. Director of Kuang Chuan Dairy Co., Ltd. Kuang Chuan Dairy Co., Ltd., Kuang
Chuan Foods Ltd., Tait Marketing
10. Director of Kuang Chuan Foods Ltd. & Distribution Co., Ltd., Changhua
11. Director of Tait Marketing & Distribution County Chang Chun-Ya Private
Director Co., Ltd. Social Welfare Charity Foundation,
Republic of China Liu, Tsung-Delegate:Yi 2021.7.20 51~60M/ 2024.7.19 2015.6.18 0 0 0 0 0 0 0 0 12. Director of Changhua County Chang Chun-Ya Private Social Welfare Charity Foundation Yantai North Andre Juice Co., Ltd., Champ Green Capital Limited, SMS Capital Management Ltd., SMS Investment Management Co., Ltd., NA NA NA
13. Director of Yantai North Andre Juice Co., SMS Capital Co., Ltd., Shanghai
Ltd. Shunfeng Restaurant Group Co., Ltd.,
14. Director of Champ Green Capital Huasui Tomato Investment Company,
Woongjin Foods Co., Ltd., Daeyoung
15. Director of SMS Capital Management Ltd. Foods Co., Ltd., Uni-president(Korea)
16. Director of SMS Investment Management Co., Ltd.
Co., Ltd.
17. Director of SMS Capital Co., Ltd.
18. Director of Shanghai Shunfeng Restaurant
Group Co., Ltd.
19. Director of Huasui Tomato Investment
Company
20. Director of Woongjin Foods Co., Ltd.
21. Director of Daeyoung Foods Co., Ltd.
22. Director of Uni-President(Korea) Co., Ltd.
23. President of Champ Green (Shanghai)
Consulting Co., Ltd.
24. Director and President of United Advisor
Venture Management Ltd.
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Executives, Directors or
Shareholding
Shareholding when Spouse & Minor Supervisors Who are Spouses
Title Nationality Name ElectedDate Gender/age (Until)Term Date (FirstElected) Elected Current Shareholding Shareholding Arrangementby Nominee Experience (Education) Current Position with PSC and Other Company or within Two Degrees of Kinship
Shares % Shares % Shares % Shares % Title Name Relation
1. MBA of University of Strathclyde 1. PSC: NA
2. CFO of Uni-President Enterprises Corp. 2. Other Company:
3. CFO of Uni-President China Holdings Ltd. • Vice President:
4. Director of President Securities Corporation Uni-President Enterprises Corp.
5. Director of Uni-President China Holdings • Director:
Ltd. Uni-President China Holdings
Ltd. , President Enterprises (China)
Investment Co., Ltd. , Uni-President
Republic of China Chen, Kuo-Delegate:Hui 2021.7.20 51~60M/ 2024.7.19 2017.11.3 0 0 0 0 0 0 0 0 Hong Kong Holdings Limited,President (Vietnam) Co., Ltd.,President International Development Uni- NA NA NA
Corp. , Uni-President (Singapore) Pte.
Ltd.
• Chairman:
Kai Yu (BVI) Investment Co., Ltd. 、
Tone Ren Enterprise Co., Ltd.
• Supervisor:
Champ Green (Shanghai) Consulting
Co., Ltd., United Advisor Venture
Management Co., Ltd.
1. M.S., Dept. of Business Administration, 1. PSC: NA
National Cheng Kung University
2. Other Company:
2. Vice President of ScinoPharm Taiwan Ltd.
(Administraion Center ) • Vice President (Secretarial the Board
of Directors)
Director Delegate: 3. Vice President of President International President Chain Store Corp.
Republic of China Hung, Hui-Hsieh 2021.7.20 61~70F/ 2024.7.19 2001.3.21 55,660 0 57,886 0 18,607 0 0 0 4. Chief Audit Officer of President Chain Development Corp.(F&A Divison) NA NA NA
Tzu Store Corp.
5. Director of President Securities Corporation
1. Master of Business Administration/Institute 1. PSC: NA
of Financial Management, National Sun
Yat-sen University 2. Other Company:
2. Vice President of IBT Securities Co., Ltd. • President & CEO:
ScinoPharm Taiwan, Ltd.
3. Assistant Manager of Taiwan International
Securities Corporation • Director:
4. Division Head of Treasury Division, Uni- President Transnet Corp.
Republic of Delegate: 2021.7.20 F/ 2024.7.19 2015.6.18 0 0 0 0 0 0 0 0 President Enterprises Corp. • Supervisor : NA NA NA
China Lu, Li-An 41~50 5. Director of President Transnet Corp., Tong Kuan Enterprise Co., Ltd.
President Collect Service Corp.
6. Supervisor of Tong Kuan Enterprise Co.,
Ltd.
7. Director of President Securities Corporation
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Executives, Directors or
Shareholding
Shareholding when Spouse & Minor Supervisors Who are Spouses
Title Nationality Name ElectedDate Gender/age (Until)Term Date (FirstElected) Elected Current Shareholding Shareholding Arrangementby Nominee Experience (Education) Current Position with PSC and Other Company or within Two Degrees of Kinship
Shares % Shares % Shares % Shares % Title Name Relation
Hui Tung
Investment 2021.7.20 2024.7.19 1994.10.29 10,403,534 0.71 10,819,675 0.74 0 0 0 NA NA NA NA NA
Co., Ltd.
1. Department of International Business 1. PSC: NA
Soochow University
2. Other Company:
2. Vice Chairman of Hui Tung Enterprise
Corp. • Chairman:
Chieforce Corp.
3. Director of HHB Geriatric Healthcare Corp. • Vice Chairman:
Director
4. Director of Hui Tung Investment Co., Ltd. Hui Tung Enterprise Corp.
Republic of China Delegate: Lee, Chi-Ming 2021.7.20 41~50M/ 2024.7.19 2018.6.21 0 0 0 0 0 0 0 0 5. Director of Japan Asia Specialities Co., Ltd.6. Director of President Securities Corporation • Director:Hui Tung Investment Co., Ltd. , HHB NA NA NA
Geriatric Healthcare Corp. , Japan
Asia Specialities Co., Ltd., Zhao
Tung Corp., Chao Tung Corp., Union
Chinese Corp., Point Deco Co., Ltd.,
Huai Ren International Co., Ltd.
• Supervisor:
Chang Kun Housing Corp.
Leg Horn
Investment 2021.7.20 2024.7.19 1988.11.26 12,656,178 0.86 13,162,425 0.90 0 0 0 0 NA NA NA NA NA
Co., Ltd.
1. BBA in Business Administration, Soochow 1. PSC: NA
Director University 2. Other Company:
Delegate: 2. Accounting Manager of Leg Horn
Republic of China Chang, Ming- 2021.7.20 71~80F/ 2024.7.19 1990.3.30 1,209,383 0.08 1,257,758 0.08 0 0 0 0 Investment Co., Ltd. • Director and Accounting Manager:Leg Horn Investment Co., Ltd. NA NA NA
Chen 3. Director of Leg Horn Investment Co., Ltd.
4. Director of President Securities Corporation
Ta Le
Investment
2021.7.20 2024.7.19 2000.6.8 7,316,067 0.50 7,505,749 0.51 0 0 0 0 NA NA NA NA NA
Holding
Co., Ltd.
1. National Tainan Girl’s Senior High School 1. PSC: NA
2. Chairman of Ta Le Investment Holding 2. Other Company:
Director Co., Ltd.
• Chairman:
Republic of China Delegate: Tu, Li- 2021.7.20 81~90F/ 2024.7.19 2000.6.8 514,104 0.03 534,668 0.03 0 0 0 0 3. Chairman of Litz's Enterprise Ltd.4. Director of Strong Team International Inc. Ta Le Investment Holding Co., Ltd., Litz’s Enterprise Ltd. NA NA NA
Yang 5. Director of President Securities Corporation • Director:
Strong Team International Inc., Kao’s
Express Warehouse & Stevedoring Co.,
Ltd.
11
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Executives, Directors or
Shareholding
Shareholding when Spouse & Minor Supervisors Who are Spouses
Title Nationality Name ElectedDate Gender/age (Until)Term Date (FirstElected) Elected Current Shareholding Shareholding Arrangementby Nominee Experience (Education) Current Position with PSC and Other Company or within Two Degrees of Kinship
Shares % Shares % Shares % Shares % Title Name Relation
China F.R.P
2021.7.20 2024.7.19 1994.10.29 10,200,000 0.70 10,400,000 0.71 0 0 0 0 NA NA NA NA NA
Corp.
1. Ming Chuan University 1. PSC: NA
2. Accounting Deputy Manager, Auditing 2. Other Company:
Director Manager of Eternal Materials Co., Ltd.
Republic of China Lee, Shu-Delegate: 2021.7.20 71~80F/ 2024.7.19 2015.6.18 0 0 0 0 0 0 0 0 3. Director of President Securities Corporation • Consultant: China F.R.P Corporation NA NA NA
Fen • Employee:
Kao Ying-Shih Chinese Culture
Collection Educational Foundation of
Kaohsiung.
1. Master of Business Administration, 1. PSC: NA
University of Dallas
2. Other Company:
2. Chairman of Shun Fu Tai Industrial Co.,
Ltd. • Chairman:
Shun Fu Tai Industrial Co., Ltd. , Yao-
3. Chairman of Yao-Jun Technology Inc. Jun Technology Inc.
Director Republic of China Duh, Bor-Tsang 2021.7.20 61~70M/ 2024.7.19 2012.6.22 4,273,744 0.29 4,444,693 0.30 2,334,693 0.16 0 0 4. Chairman of My-Semi Inc.5. Director of President Securities Corporation • Director:My-Semi Inc., Midori Inc. , NANTEX NA NA NA
Industry Co., Ltd.
6. Director of Shin Lin Investment Inc.Morioka Investment Inc., Lillian , • Supervisor:
Investment Co., Ltd. , Midori Inc. Lillian Investment Co., Ltd.
7. Supervisor of Konten Networks Inc. ,
NANTEX Industry Co., Ltd.
1. The University of California Irvine Paul 1. PSC: NA
Merage School of Business, MBA
2. Other Company:
2. Supervisor of Grown Field Co., Ltd.
• Chairman:
Director Republic of China Tzong-Lee, 2021.7.20 41~50M/ 2024.7.19 2021.7.20 836,911 0.05 870,387 0.05 0 0 0 0 3. Chairman of Fu Huey Inc 4. Director of Teh Long Warehousing & • Director:Fu Huey Inc NA NA NA
Shiun Stevedoring Co., Ltd.
Teh Long Warehousing & Stevedoring
Co., Ltd.
• Supervisor:
Grown Field Co., Ltd.
1. Golden Gate University, MBA in Finance 1. PSC: NA
2. Chairman of United Investment Ptd. Ltd. 2. Other Company:
3. Assistant Vice President of Tainan Spinning • Chairman:
Co., Ltd. United Investment Pte. Ltd., United
Investment Pte. Ltd.(Taipei)
4. Director of President Securities Corporation
• Director and President:
T.S. Retail and Distribution Co.
Director Republic of China Jing-YauJuang, 2021.7.20 51~60M/ 2024.7.19 2018.6.21 3,060 0 3,182 0 0 0 0 0 • Director: NA NA NA
Q-Ware Systems & Services Corp.,
Eten Technologies Inc., NANTEX
Industry Co., Ltd., Nan Fan
Development Co., Ltd., Nan Fan
Housing Co., Ltd., Universal Venture
Capital Investment Corp.
• Assistant Vice President:
Tainan Spinning Co., Ltd.
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Executives, Directors or
Shareholding
Shareholding when Spouse & Minor Supervisors Who are Spouses
Title Nationality Name ElectedDate Gender/age (Until)Term Date (FirstElected) Elected Current Shareholding Shareholding Arrangementby Nominee Experience (Education) Current Position with PSC and Other Company or within Two Degrees of Kinship
Shares % Shares % Shares % Shares % Title Name Relation
1. MBA, George Washington University 1. PSC: Member of Audit Committee
/ Remuneration Committee / Risk
2. Department of Finance, Shih Hsin Management Committee , Supervisory
University Associate Professor / Assistant personnel of Trust
Professor
2. Other Company:
3. Independent Director of President Securities
Independent Republic of Liang, 2021.7.20 F/ 2024.7.19 2015.6.18 0 0 0 0 0 0 0 0 Corporation • Associate Professor: NA NA NA
Director China Yann-Ping 51~60 4. Vice President of Hua Nan Investment Shih Hsin University
Trust • Member of Self-disciplinary
5. Vice President of Polaris Securities Committee:
Investment Trust Unique Satellite Television (USTV)
6. Chairman of Department of Finance,
MingDao University
1. Ph.D. in Law, Chinese Culture University 1. PSC: Member of Audit Committee
/ Remuneration Committee / Risk
2. Vice Chariman of China Petrochemical Management Committee
Development Corporation
2. Other Company:
3. Chariman of The First Leasing Corp.
• Chairman:
4. Chairman of Bo-Meng Investment Co., Ltd.
The First Leasing Corp. , Bo-Meng
5. Independent Director of President Securities Investment Co., Ltd.
Independent Republic of Pai, Chun- 2021.7.20 M/ 2024.7.19 2018.6.21 0 0 0 0 0 0 0 0 Corporation • Vice Chairman: NA NA NA
Director China Nan 71~80 6. Independent Director of Megaforce China Petrochemical Development
Company Ltd. Corporation
7. Director of Taivex Therapeutics • Independent Director:
Corporation
Megaforce Company Ltd.
8. Director of Wei Lih Food Industrial Co., • Director:
Ltd.
Wei Lih Food Industrial Co., Ltd.,
Taivex Therapeutics Corporation, BES
Engineering Corp.
1. The University of Iowa, MBA 1. PSC: Member of Audit Committee
/ Remuneration Committee / Risk
2. Assistant Vice President of BNP Paribas Management Committee
Taiwan
2. Other Company:
3. Executive Director of Goldman Sachs
(Asia) • Venture partner:
Leadsun Investment & Asset
4. Director of SG Warburg Securities Ltd. Management Ltd.
Taiwan
• Supervisor:
5. Vice Chairman of ABN AMRO Bank, Zhi Nong Green Power Investment
Taipei Branch Co., Ltd.
Independent Director Republic of China Yung-FongSong, 2021.7.20 61~70M/ 2024.7.19 2018.6.21 0 0 0 0 0 0 0 0 6. Managing Director of CIMB Securities, Taiwan • Consultant:Max Pro Capital Investments NA NA NA
7. CIO and Executive Vice President of Consulting Co., Ltd.
Chunghwa Telecom Co., Ltd. • Chief Strategy Officer:
8. Director of Chunghwa Investment Max Pro Capital Acquisition Company
Company • Partner:
9. President of Chunghwa Investment
Max Pro Venture Capital Company
Company
10. Managing Director of Deutsche Bank
Taiwan
11. Independent Director of President Securities
Corp.
13
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Note 1: The shareholding ratio was calculated based on the 1,455,831,343 shares of the share capital of President Securities Corporation.

Note 2: The information above is based on April 1, 2022. And the shareholding condition is based on April 25, 2022.

2. Major Shareholders of PSCʹs Institutional Shareholders

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April 25, 2022
PSC's Institutional
Major Shareholders of PSC's Institutional Shareholders (Holding Percentage) (Note2)
Shareholders (Note1)
Leg Horn Investment Co.,
Chang, Pin-Tang (45.05%), Chang, Benjamin Pin-Yen (49.25%)
Ltd.
Hui Tung Investment Co.,
Lee, Tong-Liang (44.88%), Hsu, Jui-Chung (15%), Lee, Pei-Shan (12.44%), Lee, Chi-Hung (12.44%), Lee, Chi-Ming (12.44%)
Ltd.
Ta Le Investment Holding Lee Ou Yang, Li-Chen (26.54%), Lee, Chia-Rong (7.69%), Lee, Yee-Ching(55.78%), Kao, Kuo-Lun(3.08%), Lee, Agnes(1%), Kao, Fu-Yu(0.92%), Kao, Fu-
Co., Ltd. Ting(0.92%), Kao, Fu-Cheng (0.92%), Lee, Alexander (3.15%)
Kai Nan Investment Co., Ltd. Uni-President Enterprises Corp. (100%)
Canking Investment Co., Ltd. Teng, Wen-Hwi (26.35%), Teng, Jun-Tse (26.69%), Teng, Wen-Hsuan (26.35%), Yang, Yu-Chiao (10.67%)
Kao, Ying-Shih (23.39%), Jia Cheng Enterprise Ltd.(20.85%), Kao, Kuo-Lun(14.77%), Strong Team International Inc.(7.25%), Lee, Chia-Rong (3.53%), Wu
China F.R.P Corp.
Hong, Siao-Gui (1.75%), Kao, Fu-Yu(2.55%), Yang, Chin-Lan(2.5%), Kao, Fu-Ting(2.75%), Wu, Su-Yun (1.45%)
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Note 1: As the Company’s Directors and Supervisors belong to institutional shareholder representatives, the name of the institutional shareholders.

Note 2: The name of the major shareholders of the institutional shareholders and their shareholding ratio. If the major shareholders are corporations, their information is listed in the table below.

Institutional Shareholders of the Major Shareholders

April 25, 2022

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Institutional Shareholders Major Shareholders of the Institutional Shareholders (Holding Percentage) (Note)
Kao Chyuan Inv. Co., Ltd. (5.00%), Cathay Life Insurance Co.,Ltd. (3.41%), BNP Paribas - Hong Kong Branch (3.02%), Hou, Po-Ming (2.60%), Hou,
Uni-President Enterprises
Po-Yu (2.27%), The Overlook Partners Fund L.P. (1.69%), Kao, Shiow-Ling (1.64%), JP Morgan Chase Bank N.A. Taipei Branch in custody for Saudi
Corp.
Arabian Monetary Agency (1.47%), Labor Pension Fund-New Scheme (1.33%), Norges Bank - internal - NBIM PF EQ INTERNAL CFD (1.27%)
Strong Team International
Kao, Kuo-Lun(38.26%), Lee, Chia-Rong (35.23%), Jia Cheng Enterprise Ltd. (24.07%), Chen, Chen-Ju (0.01%), Lai, Jia-Huei (2.44%)
Inc.
Kao, Kuo-Lun (9.00%), Lee, Chia-Rong (9.00%), New Genius Ltd (60.00%), Strong Team International Inc. (12.00%), Phuket Investments Limited
Jia Cheng Enterprise Ltd.
(9.00%), Kao, Fu-Ting(2.00%)
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Note: Name and holding percentage of the top ten shareholders of the Company’s institutional shareholders.

3. Professional qualifications and independence analysis of directors

(1) Information disclosure for the professional qualification of Directors and independence of Independent Directors:

Criteria Name	Professional Qualifcation Requirements and Work Experience	Independence Disclosure
Lin, Kuan-Chen Delegate of Kai Nan Investment Co., Ltd.	I have over fve years of working experience and professional business management expertise; I graduated from National Taiwan Sport University. I possess extensive working experience in securities dealers; I held positions as the Vice Chairman and President of President Securities Corporation; currently, I am the representative of Kai Nan Investment Co., Ltd., the corporate chairman of the Company, and the Company's Chairman. Not been a person of any conditions defned in Article 30 of the Company Act.	Apart from Notes 1(2), (3), (7), (8), and (12), Director is the Chairman of the Company, Chairman of Richness Cereal Trading Co, President of Fonmau Cereal Industrial Co., Ltd., Director of President Futures Corp., one of the top ten natural person shareholder of the Company, and the representative of the corporate shareholder of the Company as stated in Article 27, the Director complies with the specifcations of independence in Note 1.
Liu, Tsung-Yi Delegate of Kai Nan Investment Co., Ltd.	I have over 20 years of working experience and professional fnancial and accounting knowledge; I have Ph.D. in Finance, National Chung Hsing University, R.O.C. I possess extensive working experience in fnance and business; I held positions as the Manager of President International Development Corp. and Vice President of Uni- President Enterprises Corp, Business Integration Division Currently, I am the Director of President International Development Corp., Presco Netmarketing, Inc., Kuang Chuan Dairy Co., Ltd., and Kuang Chuan Foods Ltd., and am the representative of Kai Nan Investment Co., Ltd., the Company's corporate Director. Not been a person of any conditions defned in Article 30 of the Company Act.	Apart from Notes 1(2), (5), and (12), is the Director of the Company, hold position in the Uni- President Enterprises Corporation, a corporate shareholder holding over 5% of the Company's issued shares, and the representative of the corporate shareholder of the Company as stated in Article 27, the Director complies with the specifcations of independence in Note 1.
Chen, Kuo-Hui Delegate of Kai Nan Investment Co., Ltd.	I have over 10 years of working experience and professional business management expertise; I graduated with an MBA from the University of Strathclyde, possessing extensive working experience in fnancial management. I held the position as the CFO of Uni-President China Holdings Ltd. Currently, I am the Director of Uni-President China Holdings Ltd. and President International Development Corp., and am the representative of Kai Nan Investment Co., Ltd., the Company's corporate Director. Not been a person of any conditions defned in Article 30 of the Company Act.	Apart from Notes 1(2), (5), and (12), is the Director of the Company, hold position in the Uni- President Enterprises Corporation, a corporate shareholder holding over 5% of the Company's issued shares, and the representative of the corporate shareholder of the Company as stated in Article 27, the Director complies with the specifcations of independence in Note 1.
Hsieh Hung, Hui-Tzu Delegate of Kai Nan Investment Co., Ltd.	I have over fve years of working experience and professional business management (business, legal, and fnancial and accounting) expertise; I graduated with the M.S., Dept. of Business Administration, National Cheng Kung University. I possess extensive business management (business, legal, fnancial and accounting) working experience; I held positions as the Vice President of ScinoPharm Taiwan Ltd.(Administration Center), Vice President of President International Development Corp. (F&A Divison), Chief Audit Ofcer of President Chain Store Corp., and Director of President Securities Corporation. Currently, I am the Chief of CSR/Assistant Vice President for projects of President Chain Store Corp., and am the representative of Kai Nan Investment Co., Ltd., the Company's corporate Director. Not been a person of any conditions defned in Article 30 of the Company Act.	Apart from Notes 1(2), (5), and (12), is the Director of the Company, hold position in the Uni- President Enterprises Corporation, a corporate shareholder holding over 5% of the Company's issued shares, and the representative of the corporate shareholder of the Company as stated in Article 27, the Director complies with the specifcations of independence in Note 1.

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Criteria
Number of Other
Public Companies
in Which the
Individual is
Professional Qualification Requirements and Work Experience Independence Disclosure
Concurrently
Serving as an
Independent
Director
Name
I have over 20 years of working experience and professional financial and accounting as well as legal expertise; I
possess the Master of Business Administration/Institute of Financial Management, National Sun Yat-sen University. I
Lu, Li-An Delegate of Kai Nan Investment Co., Ltd. possess extensive working experience in financial and accounting as well as business; I held the position as the chief of finance of Uni-President Enterprises Corp. Currently, I am the President of ScinoPharm Taiwan Ltd., Director of Apart from Notes 1(2), (5), and (12), is the Director of the Company, hold position in the Uni-President Enterprises Corporation, a corporate shareholder holding over 5% of the Company's issued shares, and the representative of the corporate shareholder of the Company as stated in 0
President Transnet Corp., and Supervisor of Tong Kuan Enterprise Co., Ltd., and am the representative of Kai Nan Article 27, the Director complies with the specifications of independence in Note 1.
Investment Co., Ltd., the Company's corporate Director. Not been a person of any conditions defined in Article 30 of
the Company Act.
I graduated from Fu Jen Catholic University with a bachelor's degree in Economics; I have over 20 years of
experience in traditional industries and electronic industries, and possess professional financial and accounting Apart from Notes 1(2), (5), and (12), is the Director of the Company, hold position in the Uni-
Chen, Ching-Yi Delegate of Kai expertise for business management; I held positions as the Finance Deputy Manager of Apacer Technology Inc. and President Enterprises Corporation, a corporate shareholder holding over 5% of the Company's 0
Nan Investment Co., Ltd. Director of PK Venture Capital Corp.; currently, I am the Treasury Division Manager of Uni-President Enterprises issued shares, and the representative of the corporate shareholder of the Company as stated in
Corp., and the representative of Kai Nan Investment Co., Ltd., the Company's corporate Director. Not been a person Article 27, the Director complies with the specifications of independence in Note 1.
of any conditions defined in Article 30 of the Company Act.
I have over five years of working experience and professional business, legal, and accounting expertise; I graduated Apart from Notes 1(2), (5), and (12), is the Director of the Company, hold position in the Uni-
Chen, Yi-LingNan Investment Co., Ltd. Delegate of Kai from the University of Dallas Master of Business Administration, and am a professional practitioner holding the CPA certificate of the Republic of China. Currently, I am the Financial Planning Division Manager of Uni-President Enterprises Corp., and the representative of Kai Nan Investment Co., Ltd., the Company's corporate Director. Not President Enterprises Corporation, a corporate shareholder holding over 5% of the Company's issued shares, and the representative of the corporate shareholder of the Company as stated in Article 27, the Director complies with the specifications of independence in Note 1. 0
been a person of any conditions defined in Article 30 of the Company Act.
I have over 10 years of working experience and professional business management, commercial law, and accounting
Apart from Notes 1(2), (3), and (12), is the Director of the Company, one of the top ten natural
expertise; I graduated with a Ph.D. from the University of San Francisco; I held the position as a lecturer at the
Teng, Wen-Hwi Delegate of National Taipei University of Education, and have extensive working experience in business management; currently, person shareholder of the Company, and the representative of the corporate shareholder of the 0
Canking Investment Co., Ltd. I am the Chairman of Canking Investment Co., Ltd., and am the representative of Canking Investment Co., Ltd., the Company's corporate Director. Not been a person of any conditions defined in Article 30 of the Company Act. Company as stated in Article 27, the Director complies with the specifications of independence in Note 1.
I have over five years of working experience and professional business expertise; I graduated from the Department of
International Business of Soochow University. I have extensive working experience in business. Currently, I am the
Apart from Notes 1(2) and (12), is the Director of the Company and the representative of the
Lee, Chi-Ming Delegate of Hui Vice Chairman of Hui Tung Enterprise Corp., Director of Hui Tung Investment Co., Ltd., Director of HHB Geriatric corporate shareholder of the Company as stated in Article 27, the Director complies with the 0
Tung Investment Co., Ltd. Healthcare Corp., and Director of Japan Asia Specialities Co., Ltd., and am the representative of Hui Tung Investment specifications of independence in Note 1.
Co., Ltd., the Company's corporate Director.Not been a person of any conditions defined in Article 30 of the Company
Act.
I have over five years of working experience and professional accounting expertise; I graduated from BBA in
Business Administration, Soochow University and have extensive working experience in accounting; I held the Apart from Notes 1(2) and (12), is the Director of the Company and the representative of the
Chang, Ming-Chen Delegate of position as the Accounting Manager of Leg Horn Investment Co., Ltd.; currently, I am the Director of President corporate shareholder of the Company as stated in Article 27, the Director complies with the 0
Leg Horn Investment Co., Ltd.
Securities Corporation, and am the representative of Leg Horn Investment Co., Ltd., the Company's corporate specifications of independence in Note 1.
Director.Not been a person of any conditions defined in Article 30 of the Company Act.
I have over five years of working experience and professional business expertise; I graduated from National Tainan
Girl’s Senior High School. I possess extensive working experience in business; I held the position as the President Apart from Notes 1(2) and (12), is the Director of the Company and the representative of the
Tu, Li-Yang Delegate of Ta Le of Litz's Enterprise Ltd. Currently, I am the Chairman of Litz's Enterprise Ltd. and Chairman of Ta Le Investment corporate shareholder of the Company as stated in Article 27, the Director complies with the 0
Investment Holding Co., Ltd.
Holding Co., Ltd., and I am the representative of Ta Le Investment Holding Co., Ltd., the Company's corporate specifications of independence in Note 1.
Director. Not been a person of any conditions defined in Article 30 of the Company Act.
I have over five years of working experience and professional financial, accounting, and business expertise; I
graduated from Ming Chuan University. I possess extensive working experience in financial, accounting, and Apart from Notes 1(2) and (12), is the Director of the Company and the representative of the
Lee, Shu-Fen Delegate of China business; I held positions as the Accounting Deputy Manager of Eternal Materials Co., Auditing Manager of Eternal corporate shareholder of the Company as stated in Article 27, the Director complies with the 0
F.R.P Corp. Materials Co., Ltd., and Director of President Securities Corporation. Currently, I am the Consultant of China F.R.P. Corporation, and am the representative of China F.R.P Corp, the Company's corporate Director. Not been a person of specifications of independence in Note 1.
any conditions defined in Article 30 of the Company Act.
I have over five years of working experience, and have professional business management expertise; I graduated
with a Master of Business Administration at the University of Dallas, and possess extensive working experience in
Apart from Notes 1(2) and (3), is the Director of the Company, one of the top ten natural
Duh, Bor-Tsang business management; I held positions as the Director of Shin Lin Investment Inc., Morioka Investment Inc., and Lillian Investment Co., Ltd. Currently, I am the Chairman of Shun Fu Tai Industrial Co., Ltd. and Yao-Jun Technology person shareholder of the Company, the Director complies with the specifications of 0
independence in Note 1.
Inc., as well as the Director of My-Semi Inc., Midori Inc., and NANTEX Industry Co., Ltd., and the Director of the
Company. Not been a person of any conditions defined in Article 30 of the Company Act.
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Criteria
Number of Other
Public Companies
in Which the
Individual is
Professional Qualification Requirements and Work Experience Independence Disclosure
Concurrently
Serving as an
Independent
Director
Name
I have over five years of working experience, and have professional business management expertise; I graduated from
The University of California Irvine Paul Merage School of Business with an MBA, and possess extensive working
Lee, Tzong-Shiun experience in business management; I held positions as a supervisor in Grown Field Co., Ltd. and the Director of Teh Long Warehousing & Stevedoring Co., Ltd. Currently, I am the Chairman of Fu Huey Inc., and the Director of the Apart from Notes 1(2) is the Director of the Company, the Director complies with the specifications of independence in Note 1. 0
Company. Not been a person of any conditions defined in Article 30 of the Company Act.
I have over five years of working experience and professional financial expertise; I graduated from Golden Gate
Juang, Jing-Yau University in Finance with an MBA, and possesses extensive working experience in finance; I held positions as the Chief of Finance at Tainan Spinning Co., Ltd., and the Director of NANTEX Industry Co., Ltd. and Nan Fan Housing Co., Ltd. Currently, I am the Director and President of T.S. Retail and Distribution Co., and the Director of the Apart from Notes 1(2) is the Director of the Company, the Director complies with the specifications of independence in Note 1. 0
Company. Not been a person of any conditions defined in Article 30 of the Company Act.
1. The Director, its spouse, or its relatives within the second degree of kinship not being a
I have over five years of working experience and professional financial and economics, as well as accounting Director, supervisor, or employee of the Company or its affiliates.
expertise; I graduated from the George Washington University with an MBA, and possess extensive working 2. Th Director, its spouse, or its relatives within (or under other's names) the second degree of
experience in financial practices; I held positions as the Vice President of Hua Nan Investment Trust and Vice kinship has no shareholding in the Company.
Liang, Yann-Ping President of Polaris Securities Investment Trust; currently, I am the Associate Professor of Department of Finance 3. Not being a director, supervisor, or employee of any company with particular relationships 0
at Shih Hsin University, Independent Director of President Securities Corporation, and a member of the Audit with the Company.
Committee, Remuneration Committee, and Risk Management Committee. Not been a person of any conditions 4. The compensation received from providing business, legal, financial, and accounting
defined in Article 30 of the Company Act. services to the Company or its affiliates for the past two years was NT$0.
5. According to the above, I complied with the independence criteria.
I graduated from the Institute of Economics at National Taiwan University and have a Ph.D. in Law from the Chinese 1. The Director, its spouse, or its relatives within the second degree of kinship not being a
Culture University; I have provided services in public and private enterprises for over 40 years and hold teaching Director, supervisor, or employee of the Company or its affiliates.
position at National Taiwan University, National Taiwan Normal University, Soochow University, and Fu Jen 2. Th Director, its spouse, or its relatives within (or under other's names) the second degree of
University for teaching financial and economic courses. Currently, I am the Vice Chairman of China Petrochemical kinship has no shareholding in the Company.
Pai, Chun-Nan Development Corporation, Chairman of The First Leasing Corp., and the Independent Director of Megaforce 3. Not being a director, supervisor, or employee of any company with particular relationships 1
Company Ltd., as well as a member of the Audit Committee and convenor Remuneration Committee of Megaforce with the Company.
Company Ltd. I am the Company's Independent Director and a member of the Audit Committee, Remuneration 4. No compensation received from providing business, legal, financial, and accounting
Committee, and Risk Management Committee (also the convenor). Not been a person of any conditions defined in services to the Company or its affiliates for the past two years.
Article 30 of the Company Act. 5. According to the above, I complied with the independence criteria.
1. The Director, its spouse, or its relatives within the second degree of kinship not being a
I have over 30 years of working experience and professional business management, business, legal, and accounting Director, supervisor, or employee of the Company or its affiliates.
expertise; I graduated from The University of Iowa; after graduating with MBA, I held management positions in 2. Th Director, its spouse, or its relatives within (or under other's names) the second degree of
major investment banks or foreign-invested banks worldwide, such as holding positions as Vice President, Managing kinship has no shareholding in the Company.
Song, Yung-Fong Director, and Executive Director at BNP Paribas Taiwan, Goldman Sachs (Asia), SG Warburg Securities Ltd. Taiwan, 3. Not being a director, supervisor, or employee of any company with particular relationships 0
Deutsche Bank Taiwan, ABN AMRO Bank (Taipei Branch), and CIMB Securities, Taiwan, and became the CIO with the Company.
and Executive Vice President of Chunghwa Telecom Co., Ltd. in 2017. Currently, I am the Company's Independent 4. The compensation received from providing business, legal, financial, and accounting
Director and a member of the Audit Committee, Remuneration Committee, and Risk Management Committee.Not services to the Company or its affiliates for the past two years was not more than half a
been a person of any conditions defined in Article 30 of the Company Act. million.
5. According to the above, I complied with the independence criteria.
1. The Director, its spouse, or its relatives within the second degree of kinship not being a
Director, supervisor, or employee of the Company or its affiliates.
I have over five years of working experience in finance and accounting; I graduated from the Department of 2. Th Director, its spouse, or its relatives within (or under other's names) the second degree of
Economics, Soochow University; currently, I am the Independent Director of Himax Technologies, Inc.; I held kinship has no shareholding in the Company.
Horng, Yuan-Chuan positions as the Vice President of Finance Division of China Steel Corporation and Chairman of Gains Investment 3. Not being a director, supervisor, or employee of any company with particular relationships 1
Corp.; I am the Company's Independent Director, and a member of the Audit Committee, Remuneration Committee, with the Company.
and Risk Management Committee.Not been a person of any conditions defined in Article 30 of the Company Act. 4. Not provided business, financial, and accounting services to the Company or its affiliates
for the past two years. The compensation was NT$0.
5. According to the above, I complied with the independence criteria.
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Note1: The independence criteria are as follows:

1.Not an employee of the Company or any of its affiliates.

2.Not a director or supervisor of the Company or any of its affiliates. (However, if the independent directors engaged concurrently by the Company, its parent company, and its subsidiary or a subsidiary under the same parent company in accordance with this Act or local laws and regulations, this requirement shall not apply).
3.Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of 1% or more of the total number of outstanding shares of the Company or ranking in the top 10 in holdings.
4.Not a manager of the 1st subparagraph, or a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship of the persons 2nd and 3rd subparagraphs above.
5.Not a director, supervisor, or employee of a corporate shareholder who directly holds more than 5% of the Company’s total issued shares, who is among the top five shareholders, or who designates his or her representative to serve as a director or supervisor of the Company in accordance with Paragraph 1 or 2, Article 27 of the Company Act; (however, if the independent directors engaged concurrently by the Company, its parent company, and its subsidiary or a subsidiary under the same parent company in accordance with this Act or local laws and regulations, this requirement shall not apply).
6.Not a director, supervisor, or employee of another company where a majority of the Company’s director seats or voting shares and those of another company are controlled by the same person; (however, if the independent directors engaged concurrently by the Company, its parent company, and its subsidiary or a subsidiary under the same parent company in accordance with this Act or local laws and regulations, this requirement shall not apply.)
7.Not a director (or a managing director), supervisor, or employee of another company or institution where the Chairman, the President, or person holding an equivalent position of the Company and a person in an equivalent position at another company or institution are the same person or spouses; (however, if the independent directors engaged concurrently by the Company, its parent company, and its subsidiary or a subsidiary under the same parent company in accordance with this Act or local laws and regulations, this requirement shall not apply.)
8.Not a director, supervisor, officer, or shareholder holding 5% or more of the shares, of a specified company or institution which has a financial or business relationship with the Company.(However, if a specific company or institution holds more than 20% and no more than 50% of the total issued shares of the Company and if the independent directors engaged concurrently by the Company, its parent company, and its subsidiary or a subsidiary under the same parent company in accordance with this Act or local laws and regulations, this requirement shall not apply.)
9.Not a professional individual, or a spouse, who is an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that provides auditing services, commercial, legal, financial, accounting services or consultation to the Company or to any affiliate of the Company, the cumulative amount of payments obtained in the past two years has not exceeded NT$ 500,000. These restrictions do not apply to people whose duties are performed in accordance with the Securities and Exchange Act and the Business Mergers And Acquisitions Act or members of the Tender Offer Review Committee or the M&A Special Committee.
10.Not having a marital relationship, or a relative within the second degree of kinship to any other director of the Company.
11.Not been a person of any conditions defined in Article 30 of the Company Act.
12.Not a governmental, juridical person or its representative as defined in Article 27 of the Company Act.

(2) Diversity and independence of the Boardof the Board:

 Diversity of the Board:

The diversified composition policy of the Board of the Company follows the requirements of Article 10 of the “Code of Corporate Governance Practices” of the Company, in respect of the Company’s business development needs and shareholders’ shareholding and practical operational needs, and with consideration of diversity, candidates with professional knowledge, skills, literacy, and rich industry experience are selected.

Currently, there are 19 Directors in the Company, including four Independent Directors, from the financial, business, legal, and industrial backgrounds. The Company attaches great importance to gender equality in the composition of the Board, and the target percentage of female directors is over 30%. There are 9 female directors in the current term, representing 47% of total directors.

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Gender Age Comprehensive Abilities
1. 2. 3. 4. 5. 6. 7. 8. 9.
Name Operational Accoutning Operating Crisis Industrial International Leadership Decision- Risk
Male Female Below 30 30~49 More than 50 Judgement & Financial Management Management Knowledge Points of View making Management
Analysis Ability Konwledge &
Ability
Lin, Kuan-Chen ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Liu, Tsung-Yi ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Chen, Kuo-Hui ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Hsieh Hung, Hui-Tzu ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Lu, Li-An ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Chen, Ching-Yi ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Chen, Yi-Ling ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Teng, Wen-Hwi ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Lee, Chi-Ming ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Chang, Ming-Chen ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
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Gender Age Comprehensive Abilities
1. 2. 3. 4. 5. 6. 7. 8. 9.
Name Operational Accoutning Operating Crisis Industrial International Leadership Decision- Risk
Male Female Below 30 30~49 More than 50 Judgement & Financial Management Management Knowledge Points of View making Management
Analysis Ability Konwledge &
Ability
Tu, Li-Yang ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Lee, Shu-Fen ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Duh, Bor-Tsang ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Lee, Tzong-Shiun ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Juang, Jing-Yau ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Liang, Yann-Ping ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Pai, Chun-Nan ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Song, Yung-Fong ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Horng, Yuan-Chuan ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
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 Independence of the Board:

The Company has set up four independent directors, representing 21% of total directors. Independent Directors often raise constructive questions, express opinions independent of the operating team or other Directors in the Board and various committees under the Board, and request supplementary information from the operating team for explanation.

The education and experience of all directors of the Company are disclosed on the Company’s website and the annual report of the shareholders’ meeting (see Chapter III for details). The relationships among the directors are also disclosed in the annual report of the shareholders’ meeting, where there is no spousal relationship or family relationship within the second degree of kinship, which complies with the requirements of paragraphs 3 and 4, Article 26-3 of the Securities and Exchange Act.

B. Information regarding directors, supervisors, management team and branch manager

													April 1, 2022	April 1, 2022	April 1, 2022	April 1, 2022
Title	Nationality/ Country of	Name	Gender	Date Elected	Current Shareholding		Spouse & Minor Shareholding		Shareholding by Nominee Arrangement		Experience (Education)	Other Position	Managers who are Spouses or Within Two Degrees of Kinship			The status of obtaining employee stock option certificates by Managers
	Origin				Shares	%	Shares	%	Shares	%			Title	Name	Relation
President Republic Of China Tsai, Sen-Bu M 2018.06.29					332,307 0.02 0 0 0 0 1. Vice President of President Securities Corporation 2. Senior Deputy Manager of China Bills Finance Corp. 1. Director of President Futures Corp. 2. Director of President Securities (HK) Ltd. 3. Director of President Securities (Nominee) Ltd. 4. Director of President Wealth Management (HK) Ltd. 5. Director of Jin Yuan President Securities Ltd.								NA NA NA NA
Proprietary Trading Department Executive Vice President Republic Of China Yang , Kai-Chih M 2018.08.29					144,717 0 0 0 0 0 1. Vice President of President Securities. 2. Assistant Vice President of President Securities. Director of President Futures Corp.								NA NA NA NA

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Current Spouse & Minor Shareholding Managers who are Spouses or The status
by Nominee of obtaining
Nationality/ Shareholding Shareholding Within Two Degrees of Kinship
Title Country of Name Gender Date Elected Arrangement Experience (Education) Other Position employee
stock option
Origin
Shares % Shares % Shares % Title Name Relation certificates by
Managers
1. Director of President Securities (HK) Ltd.
1. Assistant Vice President of 2. Director of President Securities (Nominee)
MasterLink Securities Corp. Ltd.
Finance Republic Of 2. SVP of Ta Chong Bank LTD. 3. Director of President Wealth Management
Department Vice An, Chi-Li F 2004.06.30 165,738 0 0 0 0 0 (HK) Ltd. NA NA NA NA
President China 3. Head of Treasury of Barclays Bank
PLC 4. Supervisor of President Insurance Agency
Co., Ltd
4. Treasurer of Societe Generale
5. Chief supervisor of Jin Yuan President
Securities Ltd.
Quantitative 1. Vice President of Oriental Securities
Trading Department Vice Republic Of China Huang, Jung-Jen M 2009.03.26 113,883 0 0 0 0 0 2. Assistant Vice President of N/A NA NA NA NA
MasterLink Securities
President
1. Professional Vice President of
Financial Product Republic Of President Securities
Department Vice Pu, Chien-Heng M 2019.03.22 0 0 0 0 0 0 N/A NA NA NA NA
President China 2. Assistant Manager of Capital
Securities
Capital Market 1. Vice President of Taishin Securities
Republic Of
Department Vice China Wei, Chih-Hsu M 2020.11.10 0 0 0 0 0 0 2. Sales Assistant Vice President of Director of Fortune Industries Inc. NA NA NA NA
President Taiwan Securities
1. Senior Assistant Vice President of
Fixed Income Department Vice Republic Of Yeh, Ming- M 2020.12.24 0 0 0 0 0 0 President Securities. N/A NA NA NA NA
President China Chieh 2. Assistant Vice President of President
Securities.
Shareholder 1. Assistant Vice President of President
Services Republic Of Chueh, Chih- Securities
M 2021.04.01 88,989 0 0 0 0 0 N/A NA NA NA NA
Department Sales China Chung 2. Senior Vice President of Capital
Vice President Securities
1. Senior Manager of President
Auditing Office Republic Of Huang, Sha-Mei F 2018.03.14 0 0 0 0 0 0 Securities N/A NA NA NA NA
Chief Auditor China 2. Senior Project Manager of President
Securities
Administration 1. Assistant Vice President of President
Department Senior Republic Of Securities Director of President Insurance Agency Co.,
Yu, Hung-Chieh M 2018.07.01 872 0 0 0 0 0 NA NA NA NA
Assistant Vice China 2. Special Assistant of President Ltd.
President Securities
Information
1. Assistant Vice President of President
System Republic Of Securities
Department Senior Lin, Jung-Hui M 2020.07.01 89 0 0 0 0 0 Director of President Futures Corp. NA NA NA NA
Assistant Vice China 2. Senior Manager of President
Securities
President
20
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Current Spouse & Minor Shareholding Managers who are Spouses or The status
by Nominee of obtaining
Nationality/ Shareholding Shareholding Within Two Degrees of Kinship
Title Country of Name Gender Date Elected Arrangement Experience (Education) Other Position employee
stock option
Origin
Shares % Shares % Shares % Title Name Relation certificates by
Managers
Quantitative 1. Assistant Vice President of President
Trading Republic Of Securities
Department Lee, Chien-Hsin M 2022.02.01 0 0 0 0 0 0 N/A NA NA NA NA
Senior Assistant China 2. Senior Manager of President
Securities
Vice President
Quantitative 1. Assistant Vice President of President
Trading Department Republic Of Chien, Pang- M 2022.02.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Senior Assistant China Yen 2. Professional Assistant Vice President
of President Securities
Vice President
1. Manager, Deputy Manager of
Compliance Republic Of President Securities
Division Assistant Hung, Ying-Che M 2008.03.19 57,970 0 0 0 0 0 N/A NA NA NA NA
Vice President China 2. Legal Specialist of Sam Shin Trading
Co. Ltd.
President Office
Corporate 1. Senior Manager of President
Governance Republic Of Chen, Nai-Chen F 2019.05.03 404 0 0 0 0 0 Securities Director (Representative of President NA NA NA NA
Assistant Vice China 2. Manager of President Securities Securities) of HuaVI Venture Capital Co.,Ltd.
President
Capital Market
1. Senior Manager of President
Department Republic Of Chang, Chin- M 2013.06.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Assistant Vice China Yung
President 2. Manager of President Securities
Finance
1. Senior Manager of President
Department Republic Of Su, Wei-Lun M 2016.06.20 0 0 0 0 0 0 Securities N/A NA NA NA NA
Assistant Vice China
President 2. Manager of President Securities
Financial Product
1. Senior Manager of President
Department Assistant Vice Republic Of China Chang, Chung-Lin M 2016.08.01 43,925 0 0 0 0 0 Securities Director of Shan Ben Engineering Co., Ltd. NA NA NA NA
President 2. Manager of President Securities
Shareholder
Services 1. Senior Manager of President
Department Republic Of Chang,Shao- M 2016.09.01 217 0 0 0 0 0 Securities N/A NA NA NA NA
China Ping
Assistant Vice 2. Manager of President Securities
President
Settlement
& Clearing 1. Assistant Vice President of President
Department Republic Of Wu, Sheng-Yu M 2019.06.18 17,080 0 0 0 0 0 Futures Corp. N/A NA NA NA NA
China
Assistant Vice 2. Manager of President Futures Corp.
President
Capital Market
1. Senior Manager of President
Department Republic Of Chen, Chia- M 2019.07.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Assistant Vice China Chang
President 2. Manager of President Securities
Capital Market
1. Senior Manager of President
Department Republic Of Chiang, Chang- M 2020.04.10 0 0 0 0 0 0 Securities N/A NA NA NA NA
Assistant Vice China Kuen
President 2. Manager of President Securities
21
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Current Spouse & Minor Shareholding Managers who are Spouses or The status
by Nominee of obtaining
Nationality/ Shareholding Shareholding Within Two Degrees of Kinship
Title Country of Name Gender Date Elected Arrangement Experience (Education) Other Position employee
stock option
Origin
Shares % Shares % Shares % Title Name Relation certificates by
Managers
Information
System 1. Senior Manager of President
Department Republic Of Hu, I-Der M 2020.07.01 123 0 0 0 0 0 Securities N/A NA NA NA NA
China
Assistant Vice 2. Manager of President Securities
President
Capital Market 1. Assistant Vice President of Taishin
Department Republic Of Securities
Lin, Wei- Hung M 2021.03.04 0 0 0 0 0 0 N/A NA NA NA NA
Assistant Vice China 2. Manager of Mercuries Life
President Insurance
Settlement
& Clearing 1. Senior Manager of President
Department Republic Of Huang, Chi- M 2021.08.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
China Ming
Assistant Vice 2. Manager of President Securities
President
Corporate Client 1. Senior Manager President of Entie
Dept. Assistant Republic Of Liao, Ling -Yun F 2021.10.18 0 0 0 0 0 0 Commercial Bank, Ltd. N/A NA NA NA NA
China
Vice President 2. Vice President of BNP Paribas
Risk Control 1. Senior Manager of President
Office Republic Of Chang, Ping- M 2015.11.09 16,007 0 0 0 0 0 Securities N/A NA NA NA NA
China Chuan
Senior Manager 2. Manager of President Securities
1. Supervisor Vice President of
Brokerage Department Vice Republic Of Chang, Hung- M 2021.05.06 1,490 0 0 0 0 0 President Securities N/A NA NA NA NA
President China Shuo 2. Assistant Vice President of Hua Nan
Financial Holdings
Brokerage 1. Assistant Vice President of President
Department Republic Of Lin, Li-Lin F 2014.04.01 6,481 0 0 0 0 0 Securities N/A NA NA NA NA
China
District Supervisor 2. Manager of Dafeng Securities
Brokerage 1. Assistant Vice President of Mega
Department Republic Of Chien, Chia- M 2020.03.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
China Nan
District Supervisor 2. Manager of KGI Securities
Brokerage 1. Branch Assistant Vice President of
Department Vice Republic Of Lee, Chin-Yi M 2020.12.01 0 0 0 0 0 0 President Securities N/A NA NA NA NA
China
District Supervisor 2. Manager of President Securities
1. Branch Assistant Vice President of
Brokerage Republic Of Chou, Da- President Securities
Department Vice M 2022.01.01 0 0 0 0 0 0 N/A NA NA NA NA
District Supervisor China Kuang 2. Deputy Manager of Concords
Securities
Brokerage 1. Vice President of DBS Bank Limited
Department Senior Republic Of
Assistant Vice China Hsh Mei- Shu F 2021.04.06 0 0 0 0 0 0 2. Senior Manager of Yuanta N/A NA NA NA NA
Commercial Bank
President
Global
1. Assistant Vice President of Jih Sun
Institutional
Service Dept. Republic Of Wang Shi- M 2021.10.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
China Cheng 2. Assistant Vice President of President
Senior Assistant
Securities
Vice President
22
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Current Spouse & Minor Shareholding Managers who are Spouses or The status
by Nominee of obtaining
Nationality/ Shareholding Shareholding Within Two Degrees of Kinship
Title Country of Name Gender Date Elected Arrangement Experience (Education) Other Position employee
stock option
Origin
Shares % Shares % Shares % Title Name Relation certificates by
Managers
Brokerage
1. Sales Manager President of Cathay
Department Debit Republic Of Chu, Chen-Pu M 2020.07.01 0 0 0 0 0 0 Securities Corp. N/A NA NA NA NA
Center Assistant China
Vice President 2. Specialist of Fubon Securities
Brokerage 1. Senior Manager of President
Department Republic Of Securities
Li Yi- Shou M 2021.08.01 0 0 0 0 0 0 N/A NA NA NA NA
Assistant Vice China 2. Assistant Vice President of SinoPac
President Securities
Digital Business 1. Manager of President Securities
Republic Of
Dept.Senior China Tsai, Shu-Mei F 2021.07.01 12 0 0 0 0 0 2. Senior Deputy Manager of President N/A NA NA NA NA
Manager Securities
Wealth 1. Deputy Manager of President
Securities
Management and
Republic Of
Trust Department Wang, Fong-Ju F 2021.04.01 35,247 0 0 0 0 0 2. Senior Assistant Manager of N/A NA NA NA NA
China
Senior Assistant President Securities
Deputy Manager
1. District Assistant Vice President of
Tunghsing Equity Department Republic Of Chiu, Shyh- M 2022.01.01 0 0 0 0 0 0 President Securities N/A NA NA NA NA
China Tyng 2. Assistant Vice President of President
Manager
Securities
Tunghsing Equity 1. Manager of President Securities
Republic Of
Department China Tsai, Shu-Mei F 2016.04.01 12 0 0 0 0 0 2. Senior Deputy Manager of President N/A NA NA NA NA
Manager Securities
1. Assistant Vice President of KGI
Kaohsiung Branch Republic Of Wu, Huan- M 2013.04.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Manager China Chung
2. Manager of Taiwan Securities
Dunnan Branch Republic Of Chiang Chen M 2022.01.01 0 0 0 0 0 0 1. Vice President of Jih Sun Securities N/A NA NA NA NA
Manager China -Hsiung 2. Senior Manager of Taishin Bank
1. Manager of President Securities
Zhongli Branch Manager Republic Of China Chiang, Tsong-Shyan M 2007.12.19 0 0 0 0 0 0 2. Manager of Kurn Bern Machinery N/A NA NA NA NA
Company
1. Assistant Vice President of President
Chengzhong Republic Of Chu, Po-Lin M 2020.09.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Branch Manager China 2. Senior Manager of President
Securities
1. Deputy Manager of President
Chengzhong Republic Of Chao, Cheng M 2019.11.06 0 0 0 0 0 0 Securities N/A NA NA NA NA
Branch Manager China 2. Deputy Manager of Concords
Securities
1. Deputy Manager of President
Tainan Branch Republic Of Securities
Hsieh,Chia-Hsi M 2019.01.01 0 0 0 0 0 0 N/A NA NA NA NA
Manager China 2. Sales Assistant Manager of President
Securities
23
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Current Spouse & Minor Shareholding Managers who are Spouses or The status
by Nominee of obtaining
Nationality/ Shareholding Shareholding Within Two Degrees of Kinship
Title Country of Name Gender Date Elected Arrangement Experience (Education) Other Position employee
stock option
Origin
Shares % Shares % Shares % Title Name Relation certificates by
Managers
1. Manager of President Securities
Taichung Branch Manager Republic Of China Yang, Kuo-Chen M 2022.01.01 0 0 0 0 0 0 2. Deputy Manager of SAMPO N/A NA NA NA NA
Securities
1. Branch Assistant Vice President of
Hsinchu Branch Republic Of Lee, Chin-Yi M 2014.09.01 0 0 0 0 0 0 President Securities N/A NA NA NA NA
Manager China
2. Manager of President Securities
1. Project Manager of President
Chiayi Branch Republic Of Huang Hsiang- M 2022.04.01 1,284 0 0 0 0 0 Securities N/A NA NA NA NA
Manager China En
2. Manager of President Securities
1. Sales Manager of President Securities
Pingtung Branch Manager Republic Of China Wang, Chien-Min M 2009.04.01 0 0 0 0 0 0 2. Deputy Manager of President N/A NA NA NA NA
Securities
1. Senior Deputy Manager of President
Keelung Branch Republic Of Hung Chien- F 2022.01.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Manager China Han 2. Deputy Manager of President
Securities
Yonghe Branch Republic Of Wu, Han-Chang M 2021.01.01 0 0 0 0 0 0 1. Vice Manager of Mega Securities N/A NA NA NA NA
Manager China 2. Manager of KGI Securities
1. Sales Manager of President Securities
Xin Taichung Branch Manager Republic Of China Chung, Hui-Ju F 2022.01.01 10,867 0 0 0 0 0 2. Sales Deputy Manager of President N/A NA NA NA NA
Securities
1. Deputy Manager of President
Hsinying Branch Republic Of Hsiao, Po-Ming M 2016.04.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Manager China
2. Sales of President Securities
1. Manager of Yuanta core pacific
Changhua Branch Republic Of Yu, Fu-Tsun M 2018.01.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Manager China
2. Sales of Yuanta Securities
1. Senior Deputy Manager of KGI
Taoyuan Branch Republic Of Hsiao, Ju-Un F 2019.04.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Manager China 2. Deputy Manager of SinoPac
Securities
1. Sales Manager of President Futures
Yuanlin Branch Republic Of Chen, Hung- M 2019.10.01 0 0 0 0 0 0 Corp. N/A NA NA NA NA
Manager China Tsai 2. Sales Deputy Manager of President
Futures Corp.
Sanchung Branch Republic Of Chang, Shih- M 2019.01.01 0 0 0 0 0 0 1. Manager of Concord Securities. N/A NA NA NA NA
Manager China Min 2. Sales Manager of President Securities
1. Deputy Manager of Yuanta Securities
Shilin Branch Republic Of
Manager China Hsu, Fu-Chiang M 2014.10.01 0 0 0 0 0 0 2. Senior Deputy Manager of KGI N/A NA NA NA NA
Securities
Panchiao Branch Republic Of 1. Manager of KGI Securities
Lo, Shih-Hong M 2019.04.01 0 0 0 0 0 0 N/A NA NA NA NA
Manager China 2. Manager of Capital Securities
24
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Current Spouse & Minor Shareholding Managers who are Spouses or The status
by Nominee of obtaining
Nationality/ Shareholding Shareholding Within Two Degrees of Kinship
Title Country of Name Gender Date Elected Arrangement Experience (Education) Other Position employee
stock option
Origin
Shares % Shares % Shares % Title Name Relation certificates by
Managers
1. Sales Assistant Vice President of
Sanduo Branch Republic Of KGI Securities
Tai, Hung- Da M 2022.04.01 0 0 0 0 0 0 N/A NA NA NA NA
Manager China 2. Senior Deputy Manager of President
Securities
1. Manager of President Securities
Szichih Branch Republic Of
Manager China Lin, Yu-Ju F 2022.01.01 0 0 0 0 0 0 2. Senior Deputy Manager of KGI N/A NA NA NA NA
Securities
Ilan Branch Republic Of Chiang, Jen- F 2014.12.01 0 0 0 0 0 0 1. Manager of KGI Securities N/A NA NA NA NA
Manager China Chu 2. Manager of Capital Securities
1. Senior Assistant Vice President of Jih
Nanjing Branch Republic Of Chou, Da- M 2019.11.06 0 0 0 0 0 0 Sun Securities N/A NA NA NA NA
Manager China Kuang
2. Vice President of Pacific Securities
1. Deputy Manager of President
Kinmen Branch Republic Of Securities
Yu, Ping-Tse M 2022.01.01 0 0 0 0 0 0 N/A NA NA NA NA
Manager China 2. Sales Executive of Hua Nan
Securities
Tucheng Branch Republic Of Kao, Ming- M 2020.09.01 0 0 0 0 0 0 1. Manager of President Securities N/A NA NA NA NA
Manager China Chou 2. Manager of KGI Securities
1. Project Manager of President
Songjiang Branch Republic Of Hsh, Hua- Show F 2022.01.01 0 0 0 0 0 0 Securities N/A NA NA NA NA
Manager China 2. Senior Deputy Manager of President
Securities
Songjiang Branch Republic Of Chang, Chih- M 2021.01.01 0 0 0 0 0 0 1. Manager of President Securities N/A NA NA NA NA
Manager China Hsiang 2. Sales Manager of Hua Nan Securities
1. Manager of President Securities
Neihu Branch Manager Republic Of China Tseng, Chien-Ming M 2020.06.19 0 0 0 0 0 0 2. Professional Deputy Manager of N/A NA NA NA NA
Bank Sinopac.
1. Manager of Mega Securities
Renai Branch Republic Of
Manager China Liu, Yi-Chun F 2020.05.11 0 0 0 0 0 0 2. Sales Assistant Vice President of N/A NA NA NA NA
KGI Securities
1. Manager of Standard Chartered
Pingzhen Branch Manager Republic Of China Li, Shu-Jung F 2015.10.26 0 0 0 0 0 0 2. Bank Teller of Standard Chartered N/A NA NA NA NA
Bank
1. Deputy Manager of Jih Sun
Zhunan Branch Republic Of Securities
Su,Yung-Sheng M 2016.04.01 13,368 0 0 0 0 0 N/A NA NA NA NA
Manager China 2. Sales Assistant Manager of Polaris
Securities
1. Supervisor Vice President of
Offshore Securities Unit Branch Republic Of Chang, Hung- M 2020.11.10 1,490 0 0 0 0 0 President Securities N/A NA NA NA NA
China Shuo 2. Assistant Vice President of Hua Nan
Manager
Financial Holdings
25
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Note 1: The persentages of shares are calculated based on PSC's capital: 1,455,831,343 shares

Note 2: The information above is based on April 1, 2022, and the shareholding condition is based on April 25, 2022.

C. Remuneration of Directors, Supervisors, President, Vice Presidents, and Chief Auditor

1. Remuneration of Directors

1.1 Remuneration of Directors (disclosing the name of each individual )

Unit: NT$ thousands

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Remuneration Relevant Remuneration Received by Directors Who are Also Employees
Total Remuneration Total Compensation Compensation
Compensation Base Severance Pay (B) Bonus to Directors (C) Allowances (D) (A+B+C+D) and Ratio of Net Income (%) Salary, Bonuses, and Allowances Severance Pay (F) Profit Sharing- Employee Bonus (G) (A+B+C+D+E+F+G) and Ratio of Net Income (%) from an Invested Paid to Directors
Title Name (A) (E) Company Other
than the Company’s
PSC Group Subsidiary and
PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group parent conmpany
Cash Stock Cash Stock
Director Kai Nan Investment 35,300 35,300 - - 50,535 50,535 1,706 1,706 87,541/ 87,541/ - - - - - - - - 87,541/ 87,541/ None
Co., Ltd. 2.1845% 2.1845% 2.1845% 2.1845%
Except for the information disclosed above, the remuneration received by the Directors of the Company for providing services for all companies listed in the consolidated statements in the most recent year (such as
serving as a non-employee consultant): 0
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Note 1: The following are delegates of Kai Nan Investment Co., Ltd.: Chairman: Lin, Kuan-Chen; Directors: Liu, Tsung-Yi, Chen, Kuo-Hui, Hsieh Hung, Hui-Tzu, Lu, Li-An, Chen, Ching-Yi, Chen, Yi-Ling Note 2: Compensation was calculated as of December 31, 2021; Compensation distribution proposal is based on said earnings.
Note 3: Total remuneration paid to drivers is NT$2.141 million, which was not included in consideration.

Note 4: Except for the information disclosed above, the remuneration received by the Directors of the Company for providing services for all companies listed in the consolidated statements in the most recent year (such as serving as a non-employee consultant): 0

1.2 Remuneration of Directors (Independent Directors Included)

Unit: NT$ thousands

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Remuneration Relevant Remuneration Received by Directors Who are Also Employees
Total Remuneration Total Compensation Compensation
(A+B+C+D) and (A+B+C+D+E+F+G Paid to Directors
Compensation Base Severance Pay (B) Directors (C)Bonus to Allowances (D) Ratio of Net Income (%) Salary, Bonuses, and Allowances Severance Pay (F) Profit Sharing- Employee Bonus (G) Employee Stock Exercisable New Restricted Employee +H+I) and Ratio of Net Income (%) from an Invested Company
Title Name (A) (E) Options (H) Shares (I) Other than the
Company’s
PSC PSC Subsidiary
PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group and parent
conmpany
Cash Stock Cash Stock
Tu, Li-Yang
Delegate of Ta
Director Le Investment
Holding Co.,
Ltd.
Teng, Wen-Hwi
Delegate
Director of Canking
Investment Co.,
Ltd.
Lee, Shu-Fen
Director China F.R.P. Delegate of same as the last page
Corp.
Director Duh, Bor-Tsang
Director Juang, Jing-Yau
Lee,
Director
Tzong-Shiun
Independent Liang, Yann-
Director Ping
Independent
Pai, Chun-Nan
Director 5,760 5,760 - - 978 978 6,738/ 6,738/ - - - - - - - - - - - - 6,738/ 6,738/ None
Independent Song, 0.1681% 0.1681% 0.1681% 0.1681%
Director Yung-Fong
Independent Horng,
Director Yuan-Chuan
1. Description of independent directors’ remuneration payment policy, system, standards, and structure, as well as the relationship between the amount of remuneration and their responsibilities, risks, and time invested: The
Company’s policies and standards related to the payment of remuneration for Independent Directors are based on the Company’s Articles of Incorporation and the degree of an Independent Directors’ contribution to and
participation in operations with reference to the standards in the industry.
2. Except for the information disclosed above, the remuneration received by the Directors of the Company for providing services for all companies listed in the consolidated statements in the most recent year (such as
serving as a non-employee consultant): 0
3. Director Lee, Tzong-Shiun was appointed on 2021.07.20.
27
----- End of picture text -----

Range of remuneration for directors

==> picture [491 x 328] intentionally omitted <==

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

Name of Directors
Total of (A+B+C+D) Total of (A+B+C+D+E+F+G)
Range of Remuneration
Companies in the Companies in
The company consolidated financial The company the consolidated
statements financial statements
Delegate of Kai Nan Investment Co., Ltd.
: Liu, Tsung-Yi, Hsieh Hung, Hui-Tzu,
Lu, Li-An, Chen, Kuo-Hui, Chen, Ching-
Yi, Chen, Yi-Ling / Delegate of Canking
Investment Co., Ltd. : Teng, Wen-Hwi /
Under NT$ 1,000,000 Delegate of Leg Horn Investment Co., Ltd. same as left same as left same as left
: Chang, Ming-Chen / Delegate of Hui
Tung Investment Co., Ltd. : Lee, Chi-Ming
/ Delegate of Ta Le Investment Holding
Co., Ltd. : Tu, Li-Yang / Delegate of China
F.R.P Corp : Lee, Shu-Fen
NT$1,000,000 ~ NT$2,000,000 Liang, Yann-Ping / Pai, Chun-Nan / Song, Yung-Fong / Horng, Yuan-Chuan same as left same as left same as left
NT$2,000,000 ~ NT$3,500,000 Lee, Tzong-Shiun same as left same as left same as left
NT$3,500,000 ~ NT$5,000,000 0 0 0 0
Canking Investment Co., Ltd. / China
F.R.P Corp / Ta Le Investment Holding
NT$5,000,000 ~ NT$10,000,000 Co., Ltd. / Leg Horn Investment Co., Ltd. same as left same as left same as left
/ Hui Tung Investment Co., Ltd. / Juang,
Jing-Yau / Duh, Bor-Tsang
NT$10,000,000~ NT$15,000,000 0 0 0 0
NT$15,000,000 ~ NT$30,000,000 0 0 0 0
NT$30,000,000 ~ NT$50,000,000 Delegate of Kai Nan Investment Co., Ltd. : Lin, Kuan-Chen same as left same as left same as left
NT$50,000,000 ~ NT$100,000,000 Kai Nan Investment Co., Ltd. same as left same as left same as left
Over NT$100,000,000 0 0 0 0
Total 25 25 25 25
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2. Remuneration of the President, Vice Presidents, and Chief Auditor

Unit: NT$ thousands

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Total compensation Number of Number of Whether or not
Salary(A) Severance Pay (B) Allowances (C)Bonuses and Profit Sharing- Employee Compensation (D) ratio of net income (A+B+C+D) and option certificatesemployee stock restricted stock unit any compensation is received from
Title Name (%) other re-invested
businesses than
PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group PSC Group subsidiaries or
Cash Stock Cash Stock parant company
President Tsai, Sen-Bu
Executive
Vice Yang , Kai-Chih
President
Vice
President An, Chi-Li
Vice
President Huang, Jun-Jen
PresidentVice Pu, Chien-Heng 22,684 22,684 930 930 172,651 172,651 3,464 0 3,464 0 4.9840%199,729/ 4.9840%199,729/ 0 0 0 0 None
Vice
President Wei, Chih-Hsu
Vice
President Yeh, Ming-Chieh
Vice Chang, Hung-Shuo
President (Note2)
Chief Auditor Huang, Sha-Mei
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Note 1: Compensation was calculated as of December 31, 2021; Employee remuneration was estamated based on 2021 estamated statements.

Note 2: Vice Presiden Chang, Hung-Shuo was appointed on May 6, 2021.

2021 Annual Report

III. Corporate Governance

Range of remuneration for president and vice president

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

Name of President and Vice President
Range of Remuneration
Companies in the consolidated
The company
financial statements
Under NT$ 1,000,000 0 0
NT$1,000,000 ~ NT$2,000,000 0 0
NT$2,000,000 ~ NT$3,500,000 0 0
NT$3,500,000 ~ NT$5,000,000 0 0
Yeh, Ming-Chieh, Huang, Sha-
NT$5,000,000 ~ NT$10,000,000 Yeh, Ming-Chieh, Huang, Sha-Mei
Mei
NT$10,000,000 ~ NT$15,000,000 An, Chi-Li, Wei, Chih-Hsu An, Chi-Li, Wei, Chih-Hsu
Huang, Jun-Jen, Chang, Hung-Shuo Huang, Jun-Jen, Chang, Hung-
NT$15,000,000 ~ NT$30,000,000
Shuo
Tsai, Sen-Bu, Yang, Kai-Chih, Tsai, Sen-Bu, Yang, Kai-Chih,
NT$30,000,000 ~ NT$50,000,000
Pu,Chien-Heng Pu,Chien-Heng
NT$50,000,000 ~ NT$100,000,000 0 0
Over NT$100,000,000 0 0
Total 9 9
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D. Comparison of Remuneration for Directors, Supervisors, President and Vice Presidents in the Most Recent Two Fiscal Years and Remuneration Policy for Directors, Supervisors, President and Vice Presidents

1. Ratio of total remuneration paid to directors, supervisors, president and vice presidents to net income

==> picture [330 x 54] intentionally omitted <==

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

Year To directors(Note1) To president and vice presidents (Note1)
2020 3.54% 4.09%
2021 3.54% 4.98%
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Note1: Ratio of total remuneration to net income (%)

2. The policies, standards, and portfolios for the payment of remuneration:

(1) According to Article 23 of the Company's Articles of Incorporation, Directors' emoluments are assessed by reference of the Directors' level of participation and contribution, and decided by Board of Directors according to average industry level. When there is profit in current year, the Company shall appropriate no more than 2% of the amount as compensation to Directors according to Article 23 of the Company's Articles of Incorporation. Independent Directors do not participate in earnings appropriation to Directors. The Company regularly assesses the remuneration of the Directors in accordance with “The Performance Evaluation Measures of the Board of Directors”. The relevant performance appraisal and the reasonableness of remuneration are reviewed by the Remuneration Committee and the Board.
(2) The Company has set up various job allowances and bonuses to the Company's managers in accordance with the Company’s remuneration policy to accommodate and reward the employees for their hard work, and such bonuses are also determined based on the Company’s annual operating performance, financial condition, operating condition and individual performance. In addition, if the Company has made a profit for the year, no less than 1.6% of the profit shall be set aside as employee compensation in accordance with Article 23 of the Company's Articles of Incorporation. The performance appraisal results performed by the Company in accordance with the “Personnel Evaluation Measures” are used as a reference for the payment of bonus to the Managers. The performance evaluation items of the Managers include (1) financial indicators (business expansion capability such as revenue achievement rate, net profit after tax achievement rate, market share or market ranking) and (2) non-financial indicators (personnel

President Securities Corporation

management ability and improvement of internal process, internal control and risk control capability) and Company core value evaluation. The Company reviews the remuneration system based on actual operation status and relevant laws on a timely basis.

(3) The remuneration package of the Company shall be determined in accordance with the Remuneration Committee's Articles of Incorporation, including cash remuneration, share options, bonus shares, retirement benefits or termination benefits, various allowances and other practical incentives. The scope of remuneration paid to directors and managers is in line with what is defined in Regulations Governing Information to be Published in Annual Reports of Public Companies.

3. Procedures for determining remuneration:

(1) The periodic assessment of the remuneration to Directors and managers are respectively based on the evaluation results performed by the Company’s “The Performance Evaluation Measures of the Board of Directors” and the “Personnel Appraisal Measures” applicable to managers and employees, and the remuneration of the Chairman and President is determined with reference to the general standards of the industry and linked to the Company's operating performance indicators, which will be submitted to the Board for approval.
(2) The performance self-assessment results of the Board of Directors, members of the Board and various functional committees for 2021 were all “exceeded standard”. In addition, under COVID-19 pandemic in 2021, the Company still strived with containment measures and implemented measures for cost reduction. As a result, managers' performance reached the target, and the Company's operating performance also reached the target.
(3) The relevant performance appraisal and reasonableness of remuneration of the Directors and managers of the Company are evaluated and reviewed regularly by the Remuneration Committee and the Board on annual basis. In addition to reviewing the personal performance achievement rate and contribution to the Company, the Company’s overall operating performance, future risks and development trends of the industry as well as the actual operating conditions and relevant laws and regulations will be used as reference to timely review the compensation system. Reasonable remuneration shall be given after taking into account the current corporate governance trends so as to strike a balance between the Company’s sustainable operation and risk management. The actual amount of remuneration paid to Directors and Managers for 2021 is reviewed by the Remuneration Committee and proposed to the Board for approval.

4. The correlation between operating performance and future risks:

(1) The review of the remuneration policy, relevant benefit standards and system is based on the Company's overall operating conditions, and the payment standards are approved based on the performance achievement rate and contribution to enhance the effectiveness of the overall organizational team of the Board and the management team. The Company also refers to industry compensation standards to ensure that the remuneration to the Company's management is competitive in the industry so as to retain the best management talent.
(2) The performance targets of the Company’s managers are integrated with “risk control or internal control” to ensure that the possible risks within the scope of their duties are managed and avoided. The appraisal is given based on actual performance, and are linked to the relevant human resources and remuneration policies. Key decisions made by the management of the Company are based on a balanced range of risk factors, the performance of which is reflected in the profitability of the Company, and the remuneration of the management is thus relevant to the performance of risk control.

2021 Annual Report

III. Corporate Governance

E. President’s, senior vice presidents’ and senior managers’ remuneration

Unit: NT$ thousands

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Employee Compensation Employee Ratio of Total
Title Name - in Stock (Fair Market Compensation Total Amount to Net
Value) - in Cash Income(%)
President Tsai, Sen-Bu
Proprietary Trading Department
Yang, Kai-Chih
Executive Vice President
Finance Department Vice President An, Chi-Li
Quantitative Trading Department
Huang, Jung-Jen
Vice President
Financial Product Department Vice
Pu, Chien-Heng
President
Capital Market Department Vice
Wei, Chih-Hsu
President
Fixed Income Department Vice
Yeh, Ming-Chieh
President
Shareholder Sevices Department
Chueh, Chih-Chung
Sales Vice President
Auditing Office Chief Auditor Huang, Sha-Mei
Administration Department Senior
Yu, Hung-Chieh
Assistant Vice President
Information System Department
Lin, Jung-Hui
Senior Assistant Vice President
Quantitative Trading Department
Lee, Chien-Hsin
Senior Assistant Vice President
Quantitative Trading Department
Chien, Pang-Yen
Senior Assistant Vice President
Compliance Division Assistant Vice
Hung, Ying-Che
President
President Office Corporate
Governance Assistant Vice Chen, Nai-Chen 0 15,059 15,059 0.3758
President
Capital Market Department
Chang, Chin-Yung
Assistant Vice President
Finance Department Assistant Vice
Su, Wei-Lun
President
Financial Product Department
Chang, Chung-Lin
Assistant Vice President
Shareholder Services Department
Chang, Shao-Ping
Assistant Vice President
Settlement & Clearing Department
Wu, Sheng-Yu
Assistant Vice President
Capital Market Department
Chen, Chia-Chang
Assistant Vice President
Capital Market Department
Chiang, Chang-Kuen
Assistant Vice President
Information System Department
Hu, I-Der
Assistant Vice President
Capital Market Department
Lin, Wei-Hung
Assistant Vice President
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President Securities Corporation

==> picture [484 x 696] intentionally omitted <==

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Employee Compensation Employee Ratio of Total
Title Name - in Stock (Fair Market Compensation Total Amount to Net
Value) - in Cash Income(%)
Settlement & Clearing Department
Huang Chi-Ming
Assistant Vice President
Corporate Client Department
Liao, Ling-Yun
Assistant Vice President
Risk Control Office
Chang, Ping-Chuan
Senior Manager
Brokerage Department
Chang, Hung-Shuo
Vice President
Brokerage Department
Lin, Li-Lin
District Supervisor
Brokerage Department
Chien, Chia-Nan
District Supervisor
Brokerage Department
Lee, Chin-Yi
Vice District Supervisor
Brokerage Department
Chou, Da-Kuang
Vice District Supervisor
Brokerage Department
Hsh, Mei- Shu
Senior Assistant Vice President
Global Institutional Service
Department Senior Assistant Vice Wang, Shi-Cheng
President
Brokerage Department
Li Yi- Shou
Assistant Vice President
Brokerage Department Debit Center
Chu, Chen-Pu
Assistant Vice President
Digital Business Department Senior
Tsai, Shu-Mei
Manager
Wealth Manager and Trust
Department Senior Deputy Wang, Fong-Ju
Manager
Tunghsing Equity Department
Chiu, Shyh-Tyng
Manager
Tunghsing Equity Department
Tsai, Shu-Mei (same as the last page)
Manager
Kaohsiung Branch Manager Wu, Huan-Chung
Dunnan Branch Manager Chiang, Chen -Hsiung
Zhongli Branch Manager Chiang, Tsong-Shyan
Chengzhong Branch Manager Chu, Po-Lin
Chengzhong Branch Manager Chao, Cheng
Tainan Branch Manager Hsieh, Chia-Hsi
Taichung Branch Manager Yang, Kuo-Chen
Hsinchu Branch Manager Lee, Chin-Yi
Chiayi Branch Manager Huang, Hsiang-En
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2021 Annual Report

III. Corporate Governance

==> picture [484 x 661] intentionally omitted <==

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

Employee Compensation Employee Ratio of Total
Title Name - in Stock (Fair Market Compensation Total Amount to Net
Value) - in Cash Income(%)
Pingtung Branch Manager Wang, Chien-Min
Keelung Branch Manager Hung, Chien- Han
Yonghe Branch Manager Wu, Han-Chang
Xin Taichung Branch Manager Chung, Hui-Ju
Hsinying Branch Manager Hsiao, Po-Ming
Changhua Branch Manager Yu, Fu-Tsun
Taoyuan Branch Manager Hsiao, Ju-Un
Yuanlin Branch Manager Chen, Hung-Tsai
Sanchung Branch Manager Chang, Shih-Min
Shilin Branch Manager Hsu, Fu-Chiang
Panchiao Branch Manager Lo, Shih-Hong
Sanduo Branch Manager Tai, Hung- Da (same as the last page)
Szichih Branch Manager Lin, Yu-Ju
Ilan Branch Manager Chiang, Jen-Chu
Nanjing Branch Manager Chou, Da-Kuang
Kinmen Branch Manager Chung, Hui-Ju
Tucheng Branch Manager Kao, Ming-Chou
Songjiang Branch Manager Hsh, Hua- Show
Songjiang Branch Manager Chang, Chih-Hsiang
Neihu Branch Manager Tseng, Chien-Ming
Renai Branch Manager Liu, Yi-Chun
Pingzhen Branch Manager Li, Shu-Jung
Zhunan Branch Manager Su, Yung-Sheng
Offshore Securities Unit Branch
Chang, Hung-Shuo
Manager
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President Securities Corporation

III. Implementation of Corporate Governance

A. Board of Directors Meeting

Total of 6 meetings of the board of directors were held in the year of 2022. Directors’ attendance condition:

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Attendance
Title Name in Person By Proxy Attendance rate (%) Remark
Lin, Kuan-Chen Delegate Six board meetings were
Chairman of Kai Nan Investment Co., 6 0 100% held during the re-elected
Ltd. term of office.
Liu, Tsung-Yi Delegate of Six board meetings were
Director Kai Nan Investment Co., 6 0 100% held during the re-elected
Ltd. term of office.
Chen, Kuo-Hui Delegate of Six board meetings were
Director Kai Nan Investment Co., 5 1 83% held during the re-elected
Ltd. term of office.
Hsieh Hung, Hui-Tzu Six board meetings were
Director Delegate of Kai Nan 6 0 100% held during the re-elected
Investment Co., Ltd. term of office.
Six board meetings were
Director Lu, Li-An Delegate of Kai 6 0 100% held during the re-elected
Nan Investment Co., Ltd.
term of office.
Chen, Ching-Yi Delegate Six board meetings were
Director of Kai Nan Investment Co., 6 0 100% held during the re-elected
Ltd. term of office.
Chen, Yi-Ling Delegate of Six board meetings were
Director Kai Nan Investment Co., 6 0 100% held during the re-elected
Ltd. term of office.
Teng, Wen-Hwi Delegate Six board meetings were
Director of Canking Investment Co., 6 0 100% held during the re-elected
Ltd. term of office.
Lee, Chi-Ming Delegate of Six board meetings were
Director Hui Tung Investment Co., 6 0 100% held during the re-elected
Ltd. term of office.
Chang, Ming-Chen Delegate Six board meetings were
Director of Leg Horn Investment Co., 6 0 100% held during the re-elected
Ltd. term of office.
Tu, Li-Yang Delegate of Ta Six board meetings were
Director Le Investment Holding Co., 6 0 100% held during the re-elected
Ltd. term of office.
Six board meetings were
Director Lee, Shu-Fen Delegate of 6 0 100% held during the re-elected
China F.R.P Corp. term of office.
Six board meetings were
Director Duh, Bor-Tsang 6 0 100% held during the re-elected
term of office.
Three board meetings were
Director Lee, Tzong-Shiun 3 0 100% held during the new term of
office.
Six board meetings were
Director Juang, Jing-Yau 5 1 83% held during the re-elected
term of office.
Six board meetings were
Independent Director Liang, Yann-Ping 6 0 100% held during the re-elected
term of office.
Six board meetings were
Independent Director Pai, Chun-Nan 6 0 100% held during the re-elected
term of office.
Six board meetings were
Independent Director Song, Yung-Fong 6 0 100% held during the re-elected
term of office.
Six board meetings were
Independent Director Horng, Yuan-Chuan 6 0 100% held during the re-elected
term of office.
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2021 Annual Report

III. Corporate Governance

Other mentionable items:

A. If any of the following circumstances occur, the dates of the meetings, sessions, contents of motion, all independent directors’ opinions and the company’s response should be specified:
Matters referred to in Article 14-3 of the Securities and Exchange Act: PSC held 8 board meetings over the past fiscal year and the contents of the resolutions were refer to Chapter 3 (L) of the annual report. Did not have any matters listed in Article 14-3 of the Securities and Exchange Act or other matters not passed by the independent directors.
Other matters involving objections or expressed reservations by independent directors that were recorded or stated in writing that require a resolution by the board of directors: None.
B. If there are directors’ avoidance of motions in conflict of interest, the directors’ names, contents of motion, causes for avoidance and voting should be specified: .
For the 16th proposal at the 19th meeting of 11th Board of Directors, regarding the proposal of relieveing the non-compete clause of the Company's Directors. The Company has authorized Chairman Lin, Kuan-Chen to act as a Director in the joint venture company Jin Yuan President Securities Corporation Ltd. This has been endorsed by the Board of Directors on March 26, 2020 for record. According to Article 209, Paragraph 1 of the Company Act: ”A director who does anything for himself or on behalf of another person that is within the scope of the company's business, shall explain to the meeting of shareholders the essential contents of such an act and secure its approval”. The proposal of relieveing the non-compete clause for the 12th Director candidate Kuan-Chen Lin to act as the Director of Jin Yuan President Securities Corporation Ltd. In accordance with the provisions of Article 15 of the Company’s Rules Governing Board Meetings,the Chairman of the Board desigated Liu, Tsung-Yi as the acting chairman to preside over the matters related to discussing this proposal. Chairman Lin, Kuan-Chen left the meeting because he was not allowed to participate in the discussion of and voting on this proposal. The proposal has been passed unanimously by the members of the Directors who were present without any objection (the Chairman had recused himself from voting).
For the 23rd proposal for the review of the nomination of 12th Directors and Independent Directors at the 19th Board meeting of the 11th Board of Directors, in accordance with the provisions of Article 15 of the Company's Rules of Meetings, the current Directors and Independent Directors, who have personal interest in nominated candidates for Directors and Independent Directors under review, shall recuse themselves from the review session (as shown below).All nominees have submitted the details of their education, experience, current position, juristic person represented, and other evidences to the Board of Directors for review. Independent Director Pai, Chun-Nan acted on behalf of Chairman KuanChen Lin as chair to host the review when the Chairman recused himself from the review session.The chairman has the assent of all the members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.(Avoidance of directors had recused himself from voting.)

==> picture [341 x 41] intentionally omitted <==

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

Directors under audition/
Avoidance of interested parties
Nominee of independent director
Delegate of Kai Nan Investment Co., Ltd.: Lin, Kuan-Chen, Liu, Tsung-Yi, Chen, Kuo-Hui,
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Directors under audition/ Nominee of independent director	Avoidance of interested parties
Delegate of Kai Nan Investment Co., Ltd.:	Lin, Kuan-Chen, Liu, Tsung-Yi, Chen, Kuo-Hui,
Lin, Kuan-Chen, Liu, Tsung-Yi, Chen, Kuo-Hui, Hsieh Hung, Hui-Tzu, Lu, Li-An, Chen, Ching-Yi, Chen, Yi-Ling	Hsieh Hung, Hui-Tzu, Lu, Li-An, Chen, Ching-Yi, Chen, Yi-Ling (Lin, Kuan-Chen desigated Pai, Chun-Nan as the actingchairman.)
Teng, Wen-Hwi Delegate of CankingInvestment Co.,Ltd.	Teng, Wen-Hwi
Lee, Chi-Ming Delegate of Hui Tung Investment Co., Ltd.	Lee, Chi-Ming
Chang, Ming-Chen Delegate of LegHorn Investment Co.,Ltd.	Chang, Ming-Chen
Tu, Li-Yang Delegate of Ta Le Investment HoldingCo.,Ltd.	Tu, Li-Yang
Lee, Shu-Fen Delegate of China F.R.P Corp.	Lee, Shu-Fen
Duh, Bor-Tsang	Duh, Bor-Tsang
Juang, Jing-Yau	Juang, Jing-Yau
Liang, Yann-Ping	Liang, Yann-Ping
Pai, Chun-Nan	Pai, Chun-Nan
Song, Yung-Fong	Song, Yung-Fong
Horng, Yuan-Chuan	Horng, Yuan-Chuan

President Securities Corporation

For the 13th proposal for adjustment of 12th Independent Directors' remuneration at the 2nd board meeting of the 12th Board of Directors, in accordance with Article 19 of the Company's Articles of Incorporation, the Board of Directors were authorized to determine the Directors' remuneration based on the degree of individual participation in and contribution to the Company as well as the standards in the industry. Independent Directors are paid monthly with a fixed amount and do not participate in the distribution of Directors’ remuneration set out in Article 23. Due to the fact that this proposal involves the remuneration of independent directors, all independent directors: Liang, Yann-Ping, Pai, Chun-Nan, Song, Yung-Fong and Horng, Yuan-Chuan abstained from the discussion and voting of this proposal. After the Chairman put forward the proposal for approval, it was passed unanimously by the Directors present at the meeting without any objections (excluding Directors who recused themselves from voting).
For the 14th proposal for the 12th Chairman's remuneration at the 2nd board meeting of the 12th Board of Directors, in accordance with the provisions of Article 196 of the Company Act and Article 19 of the Company's Articles of Incorporation, the remuneration with a reference to the industry levels was proposed to the Board of Directors, and the Chairman might participate in the distribution of profit-sharing bonus according to the Company's operational performance. The Remuneration Committee made this proposal after discussion. In accordance with the provisions of Article 15 of the Company's Rules Governing Board Meetings, the Chairman of the Board designated Liu, Tsung-Yi as the acting chairman to preside over the discussion of this proposal. Chairman Lin, Kuan-Chen left the meeting because he was not allowed to participate in the discussion of and voting on this proposal. After the Deputy Chairman put forward the proposal for approval, it was passed unanimously by the Directors present at the meeting without any objections (excluding the Chairman who recused himself from voting).
C. Companies listed on stock and OTC markets shall disclose information on the evaluation cycle, period, scope, method, and content of the Board’s self (or peer) evaluation, and shall complete Schedule 2 (2) on the implementation of the evaluation of the Board of Directors: See chart B on the next page.
D. Measures taken to strengthen the functionality of the board (e.g. The Board of Directors has established an Audit Committee and a Remuneration Committee to assist the board in carrying out its various duties.) :
To strengthen the competencies of the Board of Directors and the overall risk management system, the Board of Directors set up Independent Directors and established the Audit Committee, Remuneration Committee, and Risk Management Committee to meet the governance requirements of listed companies. To enhance the implementation of corporate governance, the Company has established the “Procedures for Handling Material Internal Information”, “Sustainable Dvelopment Best Practice Principles”, “Ethical Corporate Management Best Practice Principles”, “Corporate Governance Best Practice Principles”, “The Performance Evaluation Measures of the Board of Directors” , and “The Standard Procedures of Demands of Directors”, which are implemented by relevant units on a level-by-level basis.

Note: The term of office of the 11th Board of Directors is from June 21, 2018 through June 20, 2021. The term of office of the 12th Board of Directors is from July 20, 2021 through July 19, 2024.

Independent director attendance is detailed below:

◎: Attendance in Person; ☆ : Proxy Attendance; ＊ : Absence

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Board meetings 2021.03.23 2021.05.06 2021.06.25 2021.07.28 2021.08.23 2021.11.04
Liang, Yann-Ping ◎ ◎ ◎ ◎ ◎ ◎
Pai, Chun-Nan ◎ ◎ ◎ ◎ ◎ ◎
Song, Yung-Fong ◎ ◎ ◎ ◎ ◎ ◎
Horng, Yuan-Chuan ◎ ◎ ◎ ◎ ◎ ◎
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B. Evaluation of the Board of Directors

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

Evaluation
Evaluation period Evaluation scope Evaluation method Content
cycle
1. Composition of the Board of Directors
2. Teaching of the Board of Directors
3. Authorization of the Board of Directors
4. Supervision of the Board of Directors
Evaluation of external
times /3 year 2019/7/1~2020/6/30 Board of Directors professional institution 5. Communication od the Board of Directors
6. Internal controls and risks management
7. Self-Demanding of the Board of Directors
8. Other things like meetings of the Board of
Directors and System-supporting
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2021 Annual Report

III. Corporate Governance

==> picture [542 x 332] intentionally omitted <==

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

1. Control over the Company’s goals and
tasks
2. Understanding of duties and functions of a
Director
Internal self-evaluation of 3. Involvement in the Company’s operations
Annually 2020/7/1~2021/6/30 Board of Directors
the Board of Directors 4. Management of internal relations and
communication
5. Professional and continuing education and
training for Directors
6. Internal Control
1. Involvement in the Company’s operations
2. Improving decision-making by the Board
of Directors
Annually 2020/7/1~2021/6/30 Individual Directors Self-evaluation of Directors 3. Composition and structure of the Board of Directors
4. Election of Directors and their continuing
education and training
5. Internal controls
1. Involvement in the Company’s operations
2. Understanding of duties and functions of a
functional committee
Self-evaluation of 3. Improving decision-making by the functional
Annually 2020/7/1~2021/6/30 Functional committees functional committees committees
4. Composition and structure of the functional
committees
5. Internal controls
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C. Operations of the Audit Committee: Number of Meetings, Actual Attendance Rate of each Independent Director, and other mentionable items

The Company established its Audit Committee in June of 2015. The main key points of functional authority to be audited are as follows:

Adoption or amendment of internal control systems in accordance with Article 14-1 of the Securities and Exchange Act.
Evaluation of the effectiveness of internal control systems.
Adoption or amendment, pursuant to Article 36-1 of the Act, of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, and endorsements or guarantees for others.
Items involving the interests of Directors.
Major assets or derivative trading.
Major loaning of funds, making of endorsements, or provision of guarantees.
Offering, issuance, or private placement of any equity-type securities.
Appointment, dismissal, and compensation of CPAs.
Appointments and dismissal of finance managers, accounting managers, and internal audit managers.
The annual financial statements were signed or sealed by the Chairman, managers, and accounting manager while the second quarter financial statements were audited by CPAs who attested to their accuracy.
Other major items required by other companies or the competent authority.

Total of 5 meetings of the Audit Committee were held in the year of 2021. Independent Directors’ attendance condition:

President Securities Corporation

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Actually Number Number of
Actual Attendance
Title Name of Times Times Attended Remark
Rate (%) (B/A)
Attended (B) by Proxy
Five audit committee
meetings were held
Independent Director Liang, Yann-Ping 5 0 100%
during the re-elected
term of office.
Five audit committee
meetings were held
Independent Director Pai, Chun-Nan 5 0 100%
during the re-elected
term of office.
Five audit committee
meetings were held
Independent Director Song, Yung-Fong 5 0 100%
during the re-elected
term of office.
Five audit committee
meetings were held
Independent Director Horng, Yuan-Chuan 5 0 100%
during the re-elected
term of office.
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Note : The effective date of 3th Audit Committee is July 28, 2021.

Other mentionable items:

I. If any of the following circumstances occur, the dates, terms of the meetings, contents of motions, dissenting opinions from independent directors, reserved opinions or major suggestions, the resolutions of the Audit Committee, and the Company's response to the Audit Committee's opinions.
Matters referred to in Article 14-5 of the Securities and Exchange Act: Total of 7 meetings were held in 2021 and 2022 to the publish date of the annual report. For matters referred to in Article 14-5 of the Securities and Exchange Act, all members present voted in favor of the resolution without any objection.
Other matters which were not approved by the Audit Committee but were approved by two-thirds or more of all directors: None.
II. If there are independent directors’ avoidance of motions in conflict of interest, the directors’ names, contents of motion, causes for avoidance and voting should be specified: None.
III. Communications between the independent directors, the Company’s internal audit supervisors and CPAs (e.g. the material items, methods and results of audits of corporate finance or operations, etc.):
A. Communications with the internal audit supervisors:
Communication methods:
(1) The Company shall compile a written report about improvements and follow-up on the deficiencies discovered in the audit in the previous month, and submit it to the independent directors for review by email.
(2) At each workshop on internal control deficiencies, the Company’s auditors and independent directors shall discuss and review the deficiencies in the internal control system.
(3) At each Audit Committee meeting, the internal audit supervisor shall attend the meeting to report the internal audit execution.
Summary of communication between independent directors and the internal auditors:

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Item Communication Execution period
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Item	Communication	Execution period

Summary report	1. Summary of deficiencies identified in the audit report	2021.01~2021.12 (12 times in total)
Internal control deficiencies workshop	1. Report of deficiencies identified in internal auditing 2. Summary Report on Deficiencies from the Competent Authority	2021.01~2021.12 (5 times in total)
Audit Committee meeting	1. Internal audit report 2. Summary Report on Deficiencies from the Competent Authority	2021.01~2021.12 (5 times in total)

2021 Annual Report

III. Corporate Governance

B. Communications with the CPA:
Communication methods: The Company’s Audit Committee comprises all the independent directors. The CPA holds a meeting with the Audit Committee at least twice a year. At the meeting, the auditing of the Company’s financial status and audit results shall be reported and updates on important regulations shall also be reported.
A separate meeting between independent directors (the Audit Committee) and CPA is held at least once a year.
Summary of communication between independent directors and the certified public accountant (CPA) and results of implementation:

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Date of meetings Communication and results of implementation
1. Reporting audit findings and key audit items of financial statements of 2020.
2. The CPA reports on 2021 planning stage, audit plan, and communication with governance units.
2021.03.11 3. The CPA reports on latest amendment of corporate governance evaluation and latest modification of related regulations.
4. Independent Directors’ suggections:None.
5. Reporting to the Board of Directors after approval.
Recommendations by the Independent Directors:
For Directors to understand the operational status of the Company's significant investment companies, we suggest the
2021.03.11 management team reports to include operating status and performance of investment companies accounted by the equity
(Meetings between method. We further recommend these results be given to the Audit Committee and Board of Directors twice a year during
Independent Directors the time consolidated financial reports are audited by external auditors and issued.
and the CPA.) Implementation results:
The Company has reported the operating status and performance of investment companies accounted by the equity
method in the Audit Committee at the time that CPA issued half year consolidated financial report.
1. The CPAs reporting audit findings and key audit items of financial statements of 2021 Q2.
2. The CPAs reported matters on governance related to financial reporting that required communication in the first half of
2021.
2021.08.10 3. The CPAs explained the production of financial statements, advance notice for tax law changes.
4. Report the operating status and performance of investment companies.
5. Independent Directors’ suggestions: None.
6. Reporting to the Board of Directors after approval.
1. The CPAs reporting audit findings and key audit items of financial statements of 2021.
2. The CPA reports on 2022 planning stage, audit plan, and communication with governance units.
3. The CPA reports the latest amendment of Regulations Governing the Preparation of Financial Reports by Securities
2022.02.24 Issuers and Company Law.
4. Report the operating status and performance of investment companies.
5. Independent Directors’ suggestions: None.
6. Reporting to the Board of Directors after approval.
Recommendations by the Independent Directors:
Information security issue is the future trend in finance and globalization. We hope the CPA can provide opinions,
2022.02.24 directions, and competitor practices. We also invited the CPA to provide advices to the Company's management and
(Meetings between Board of Directors from 3rd party expert's view.
Independent Directors Implementation results:
and the CPA.) The CPA reported financial information security action plan to Board of Directors on March 8, 2022. The CPA provided
related advices on two parts: preventive action on current known techniques and advance deployment. The plan would be
executed through short-term, middle-term, and long-term stages.
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Note: Major Resolutions during the Auditing Meetings in 2021 and 2022 to the publish date of the annual report: Executed according to the resolution of the Audit Committee.

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Meeting Item Resolution
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Meeting	Item	Resolution

2021.03.11 The 16th Auditing Meeting of the 2nd Audit Committee	1. Review of the 2020 Individual Financial Report and 2020 Consolidated Financial Report. 2. Accountant independence and competency evaluation. 3. Proposal for increasing capital from retained earnings for issuance of new shares. 4. Amended the Regulations Governing the Loaning of Funds and Creation of Endorsements/ Guarantees. 5. Submitted the Statement of the 2020 Internal Control System. 6. Revised the Internal Control System for Information System Department. 7. Submitted the Overall Information Security Implementation Statement. 8. Amended the Articles of Incorporation. 9. Proposal for amendments to the Rules Governing Shareholders Meetings. 10. Amended the Corporate Governance Best Practice Principles. 11. The Company’s 2020 money laundering and terrorist financing risk assessment report. 12. The Company’s 2020 legal compliance risk evaluation report. 13. Internal Control Certification on AML/CFT and Insider Trading. 14. The implementation of the principle of fair treatment of consumers in 2020. 15. Amended the policies and strategy of the principle of fair treatment of consumers.	All members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.

President Securities Corporation

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Meeting Item Resolution
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Meeting	Item	Resolution

2021.04.22 The 17th Auditing Meeting of the 2nd Audit Committee	1. Amended the Statement of the 2020 Internal Control System. 2. Revised the Internal Control System for Information System Department. 3. Relieved the non-compete limitation for the Directors. 4. The implementation of the principle of fair treatment of consumers from January to March in 2021. 5. Apply to offer consignment trading of foreign securities to high-asset customers, including international securities business. 6. Apply to offer wealth-management service to high-asset customers. 7. Apply to offer proprietary trading of overseas bonds at the business premises to high-asset customers, including international securities business. 8. Audited the operating report and profit distribution of year 2020. 9. Proposal to increase the capital of Jin Yuan President Securities Corporation Ltd.	The chairman has the assent of all the members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.
2021.06.10 The 18th Auditing Meeting of the 2nd Interim Audit Committee	1. Revision of the internal control system for derivatives instrument trading. 2. Modification of the Statement of the 2020 Internal Control System.	The chairman has the assent of all the members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.
2021.08.10 The 1th Auditing Meeting of the 3rd Audit Committee	Election matters: Election of convener of the Audit Committee. 1. Discussed the Company's 2021 Q2 individual financial statements and the consolidated financial statements. 2. Amendment to internal control system. 3. Renewal of liability insurance for Directors and key personnel. 4. Formulation of rules for transactions with stakeholders. 5. The implementation status of the principle of fair treatment to consumers from April to June in 2021.	The independent director Liang, Yann-Ping was elected as the convener of the 3rd session of the Audit Committee, and was passed unanimously by the members in attendance. The chairman has the assent of all the members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.
2021.10.21 The 2th Auditing Meeting of the 3rd Audit Committee	1. Report 2022 annual audit plan. 2. Amendment to internal control system for commissioned trading of foreign marketable securities. 3. Revision of Information Security Policy. 4. The implementation status of the principle of fair treatment to consumers from July to September in 2021.	The chairman has the assent of all the members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.
2022.2.24 The 3th Auditing Meeting of the 3rd Audit Committee	1. Review of 2021 Consolidated and Individual Financial Statements. 2. Evaluation of the independence and competency of CPA. 3. Dissolution of overseas investment President Securities (Hong Kong), President Wealth Management (Hong Kong) and President Securities (Nominee) Ltd. 4. Statement of the 2021 Internal Control System. 5. Internal control system for brokerage business. 6. Brokerage service fee rate, discount strategy, and its operating procedure. 7. Consumer disputes handling procedure. 8. Internal control system for Information System Department. 9. Overall implementation status for information security. 10. Amendment to the Articles of Incorporation. 11. Report of 2021 Legal compliance risk evaluation. 12. Report of 2021 money laundering and terrorist financing risk assessment. 13. Statement of internal control over AML/CFT. 14. Amendment to anti-money laundering and counter terrorist financing procedures and plans. 15. The proposal was withdrawn by the members of the committee in attendance. 16. Implementation status of the principle of fair hospitality in 2021.	The chairman has the assent of all the members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.
2022.04.21 The 4th Auditing Meeting of the 3rd Audit Committee	1. Amendments to Internal control system for brokerage business. 2. Review of 2021 business report and earnings distribution proposal. 3. Amendments to the Regulations Governing the Acquisition and Disposal of Assets. 4. Establishment of Conflicts of interest avoidance policy. 5. Amendments to Rules and Procedures of the Shareholders' Meeting. 6. Implementation of the Principle of fair treatment to consumers from January to March in 2022.	The chairman has the assent of all the members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.

2021 Annual Report

III. Corporate Governance

D. Corporate Governance Implementation Status and Deviations from “the Corporate Governance Best -Practice Principles for TWSE/TPEx Listed Companies”

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Implementation Status Deviations from
“the Corporate
Governance Best-
Evaluation Item Practice Principles
Yes No Abstract Illustration for TWSE/TPEx
Listed Companies”
and Reasons
I. Does the company establish ✓ In an effort to implement prudent corporate governance None
and disclose the Corporate measures in line with the ''Principles for Corporate
Governance Best-Practice Governance for Securities Firms'' and with relevant laws
Principles based on “Corporate and regulations, President Securities adopted such guidelines
Governance Best-Practice
by the 13th meeting of the 9th Board of the company held
Principles for TWSE/TPEx Listed
on August 7, 2014, and will abide by said principles.
Companies”?
The Principle was amended on March 23, 2021 for the
fourth time.
II. Shareholding structure &
shareholders’ rights
A. Does the company establish an ✓ A. 1. The Company has a spokesperson and shareholder None
internal operating procedure to deal service personnel to process shareholders’ suggestions,
with shareholders' suggestions, questions, and disputes.
doubts, disputes and litigations, and 2. The Company has established an “Investor Section”
implement based on the procedure? and “Investor Mailbox” on the Company website, which
are run by the spokesperson and dedicated personnel of
the Administration Department. Shareholders’ suggestions
or disputes are forwarded to relevant departments for
processing.
B. Does the company possess the list of ✓ B. PSC maintains close relationships with key shareholders None
its major shareholders as well as the and assigns dedicated shareholder services personnel to
ultimate owners of those shares? continually monitor any changes in the shareholdings of
these key shareholders.
C. Does the company establish and ✓ C. The finance and business of our company and its None
execute the risk management subsidiaries are in separate operation. In term of
and firewall system within its management right and obligation there is a clear line
conglomerate structure? between our company and its subsidiaries. All the
relations and trades are dealt with in accordance with
law. “Surveillance governing internal-control system for
subsidiaries” has also been set up as a controlling and
governing mechanism for our subsidiaries.
D. Does the company establish internal ✓ D. 1. In an effort to prevent insider trading and to protect the None
rules against insiders trading with interests of investors, we have adopted and implemented
undisclosed information? the “Material Event Internal Handling Procedures”,
which outlines clear division of responsibilities, adequate
firewall and confidentiality procedures, the disclosure of
material events, educational guidance rules, etc.
2. In order to handle the conflict of interest among internal
personnel effectively and protect the rights of customers,
the Company introduced ''Rules for inspection activity
on internal personnel engaged in brokerage trading''
requiring the cross comparison of brokerage trading
5 minutes prior to and after the brokerage trading for
personnel that have access to customer brokerage trading
details. In addition, inspections need to be undertaken on
whether or not there is any undisclosed information in
the brokerage trading engaged by the representative of
companies or the companies he represents to check for
any abnormality.
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President Securities Corporation

						Implementation Status	Implementation Status	Implementation Status	Implementation Status	Implementation Status	Implementation Status	Implementation Status	Implementation Status	Implementation Status	Deviations from “the Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies” and Reasons	Deviations from “the Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies” and Reasons
Evaluation Item						Yes	No		Abstract Illustration
III. Composition and Responsibilities of the Board of Directors A. Does the Board develop and implement a diversified policy for the composition of its members?						✓			A. Abiding by article 10 of our Principles for Corporate Governance, when selecting directors, President Securities uses a comprehensive approach so as to put together a professional yet independent team that can exercise its duties in an objective manner. Currently, there are 19 Directors in the Company, including 4 independent directors. Independent directors account for 21% of total Directors and are from the financial, business, legal, and industrial backgrounds; of them, there’s 3 with a term of 4-6 years, and 1 with a term of 7-9 years, conforming the target of percentage and terms of years (within 3 terms). The Company also emphasize the gender equality among Directors. The target regarding percentage of female Director is 30% or above. For the current term, there are 9 female Directors including 1 Independent Director, stand for 47% of total Directors. We expect to reach our goal in later years as well. The Board of Directors is equipped with the abilities as shown in the table below.						None

					Comprehensive Abilities
	Name	Gender	1. Operational Judgement	2. Accoutning & Financial Analysis				3. Operating Management		4. Crisis Management	5. Industrial Knowledge	6. International Points of View	7. Leadership	8. Decision- making Ability		9. Risk Management Konwledge & Ability
	Lin, Kuan-Chen	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Liu, Tsung-Yi	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Chen, Kuo-Hui	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Hsieh Hung, Hui-Tzu	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Lu, Li-An	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Chen, Ching-Yi	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Chen, Yi-Ling	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Teng, Wen-Hwi	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Lee, Chi-Ming	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Chang, Ming-Chen	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Tu, Li-Yang	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Lee, Shu-Fen	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Duh, Bor-Tsang	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Lee, Tzong-Shiun	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Juang, Jing-Yau	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Liang, Yann-Ping	F	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Pai, Chun-Nan	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Song, Yung-Fong	M	✓	✓				✓		✓	✓	✓	✓	✓		✓
	Horng, Yuan-Chuan	M	✓	✓				✓		✓	✓	✓	✓	✓		✓

2021 Annual Report

III. Corporate Governance

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Implementation Status Deviations from
“the Corporate
Governance Best-
Evaluation Item Practice Principles
Yes No Abstract Illustration for TWSE/TPEx
Listed Companies”
and Reasons
B. Does the company voluntarily ✓ B. President Securities has already added independent None
establish other functional directors to its Board, has established an audit committee,
committees in addition to the a remuneration committee, and a risk management
Remuneration Committee and the committee.
Audit Committee?
1. Based on the expertise, consistency, and time-based
effectiveness of the Company’s business, the Board
of Directors has passed the Articles of Organization
developed by the Risk Management Committee on
June 26, 2008 and established the Risk Management
Committee in the Board of Directors to implement
supervision of day-to-day risk management. The
Committee is charged with the following duties:
(1) Establishment of Company risk management policies
and organization and assignment of duties to related
units.
(2) Establishment of the Company’s risk measurement
standards.
(3) Management of limits for the Company’s overall and
departmental risk.
2. The Risk Management Committee consists of three
members. At least half of them are independent directors,
and the committee members shall be selected via
resolution of Board of Directors. The Risk Management
Committee shall convene meetings at least once every
quarter to assist the Board of Directors in planning and
supervising the Company’s related risk management
affairs. This committee shall report the implementation of
risk management to the Board of Directors periodically
and propose suggestions for necessary improvements.
3. Strategy Development Committee:In order to strengthen
the medium and long-term strategic development and to
deepen the spirit of corporate governance, the Board of
Directors resolved the Strategic Development Committee
Charter and established Strategic Development
Committee in the Board of Directors on November 4,
2021.
(1) Overseeing the promotion and implementation of the
Company’s sustainable development and corporate
governance matters.
(2) To formulate medium and long-term business
operation and strategic development directions of the
Company.
(3) Study medium and long-term organizational change
and transformation plan.
(4) Formulating the Company’s annual operation plan and
budget preparation.
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President Securities Corporation

Implementation Status Deviations from “the Corporate Governance BestEvaluation Item Practice Principles Yes No Abstract Illustration for TWSE/TPEx Listed Companies” and Reasons ✓ C. In accordance with the “Code of Practice for Corporate None Governance of Securities Firms” and in line with the competent authority’s promotion of corporate governance, the Company has formulated the “Measures for Evaluating the Performance of the Board” on August 29, 2018 and performed annual assessment. The Company regularly commissions an external independent professional institution or a team of experts and scholars for assessment at least once every three years. The Company has engaged an external professional institution-Taiwan Corporate Governance Association to conduct the assessment. The assessment result was submitted to the 11th Board of Directors and reported at the 16th meeting on November 10, 2020. 2021 Achievements:

C. Has the company formulated the board’s performance evaluation measures and evaluation methods? Does the company conduct annual and regular performance evaluations and report the evaluation results to the Board of Directors while adopting the results as a reference for individual directors’ remuneration and nomination for reelection?

Based on the recommendations of the external assessment institute, the Company submitted the amendment of “Measures for Evaluating the Performance of the Board” to the Board in May 2021 to include the functional committees into the scope of performance evaluation, and to include the functional committees' self-assessment in 2021 Board of Directors performance evaluation. In addition, to assist the Board in overseeing the promotion and implementation of the Company’s sustainable development and corporate governance matters, and to strengthen the formulation of medium and longterm strategies of the Company, the Board approved the establishment of the Strategic Development Committee in November 2021.

2021 Board of Directors' self-assessment result:
Assessment Period: July 1, 2020 to June 30, 2021 (the content of the evaluation includes matters related to 2021 Annual Shareholders' Meeting).
Directors’ self-assessment: The total number of selfassessment items was 25, in which 9 Directors received full marks of 5. The average number of self assessment for 9 Directors was more than 4, and the self-assessment results of all Directors were exceeding the standard.
Functional committees' self-assessment: The total number of self-assessment items were 22, 19 and 18 for the Audit Committee, the Remuneration Committee and the Risk Management Committee, respectively, with assessment scores of 4.97 points, 4.95 points and 4.94 points, respectively, and the evaluation results of all functional committees were exceeding the standards.
Board of directors' self-assessment: Total assessment items are 40 items, with the exception of 1 point for item 2 (due to the impact of pandemic, the date of the shareholders’ meeting was the third level national alert period with a low attendance of directors), all of which received 5 points, with an average score of 4.9 points, and the evaluation result exceeded the standard.

2021 Annual Report

III. Corporate Governance

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Implementation Status Deviations from
“the Corporate
Governance Best-
Evaluation Item Practice Principles
Yes No Abstract Illustration for TWSE/TPEx
Listed Companies”
and Reasons
C. Has the company formulated the The results of the aforementioned Board performance
board’s performance evaluation assessment were reported to the 3rd meeting of the
12th Board of Directors on November 4, 2021 for
measures and evaluation methods?
future reference. Corporate Operating and Sustainable
Does the company conduct Development Association
annual and regular performance Link between performance appraisal and remuneration
evaluations and report the evaluation of Directors and managers:
results to the Board of Directors 1. In accordance with Article 23 of the Company's
while adopting the results as a Articles of Incorporation, in order to motivate
employees and the operation team, after deducting
reference for individual directors’
employees' and Directors' compensation from
remuneration and nomination for re- current year net income before tax, the Company
election? shall allocate no less than 1.6% of the residual
amount as employees’ remuneration and no more
than 2% as Directors' remuneration.
2. According to "Board of Directors Performance
Evaluation Measures", Directors’ emoluments
are assessed by reference to the Directors’ level
of participation in the Company’s operations and
their individual contribution to the Company’s
performance, their familiarity with the Company’s
objectives and missions, knowledge of directors’
duties and responsibilities, involvement in the
Company’s operations, internal relationship
management and communication, the Directors’
professions and continuing education, internal
control and other items, the results of which are
included in the consideration of performance
evaluation and remuneration distribution.
3. Remuneration to Managers includes salaries and
bonuses with reference to industry standards,
positions, grades, education, working experience,
professional skills and responsibilities, etc.
The incentive payments take into account the
manager’s performance evaluation items, which
include financial indicators (business development
capabilities, such as revenue achievement rate, net
profit after tax achievement rate, market share or
market ranking, etc.) and non-financial indicators
(staff management capabilities and improvement
in internal process, internal control and risk control
capability). The result of the evaluation will be
included in consideration of performance appraisal
and compensation.
4. The procedures for determining the remuneration
were based on their contribution to the business
performance and the performance evaluation
measures to provide reasonable remuneration.
Relevant performance evaluation and the
reasonableness of remuneration were all reviewed
by the Remuneration Committee and the Board
of Directors; the remuneration system is reviewed
at any time depending on the actual operational
situations and relevant laws and regulations, so as to
balance the Company's sustainable operations and
risk control.
D. Does the company regularly ✓ D. Based on regulation of corporate governance of securities None
evaluate the independence of CPAs? dealers, the Board evaluates and assigns the appointment
of independent accountants annually. According to article
46 and article 47 of Certified Public Accountant Act,
“honesty, impartiality, objectivity and independence,” the
company sets up the independent items of declaration,
which issued by the certified public detached accountants.
Accountant Lin, Se-Kai, Chen, Li-Yuan, and Lo, Chiao-
Sen from PricewaterhouseCoopers Taiwan proved to
be qualified as CPA for company’s financial and tax
accountants.
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President Securities Corporation

Implementation Status Deviations from “the Corporate Governance BestEvaluation Item Practice Principles Yes No Abstract Illustration for TWSE/TPEx Listed Companies” and Reasons ✓ The Company’s Board of Directors adopted a resolution None on May 3, 2019, that Assistant Vice President Chen, NaiChen at the President Office would be appointed as the Corporate Governance Officer in charge of corporate governance-related affairs. Assistant Vice President Chen has served as a supervisor in President Office related to corporate governance for more than three years, as set out in Article 21 in accordance with Article 23 of the “Operation Directions for Compliance with the Establishment of Board of Directors by TWSE Listed Companies and the Board’s Exercise of Powers”. As a new officer, she will complete 18 hours of professional training courses and at least 12 hours in a year in accordance with paragraph 2 article 24. The Company’s corporate governance-related affairs are handled and completed by relevant departments collectively. Corporate governance-related affairs (terms of reference) shall include matters related to holding of meetings of the Board of Directors and shareholders’ meetings, minutes recording for meetings of the Board of Directors and shareholders’ meetings, assistance to Directors with taking office and continuous education and training, provision of information required for the Directors to conduct business, assistance to Directors with compliance, and other matters set out in the Company’s Articles of Incorporation or contracts.

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IV. Does the company designate ✓ The Company’s Board of Directors adopted a resolution None
an appropriate number of on May 3, 2019, that Assistant Vice President Chen, Nai-
qualified personnel and appoint Chen at the President Office would be appointed as the
a corporate governance officer Corporate Governance Officer in charge of corporate
in charge of matters related to
governance-related affairs. Assistant Vice President Chen
corporate governance? These
has served as a supervisor in President Office related to
matters include but are not
corporate governance for more than three years, as set out in
limited to providing directors
Article 21 in accordance with Article 23 of the “Operation
and supervisors with information
needed for the execution of Directions for Compliance with the Establishment of Board
business, assisting directors and of Directors by TWSE Listed Companies and the Board’s
supervisors in complying with Exercise of Powers”. As a new officer, she will complete
laws and regulations, handling 18 hours of professional training courses and at least 12
matters related to the board of hours in a year in accordance with paragraph 2 article 24.
directors and the shareholders’ The Company’s corporate governance-related affairs are
meetings in accordance with the handled and completed by relevant departments collectively.
related laws, handling company
Corporate governance-related affairs (terms of reference)
registration and registration
shall include matters related to holding of meetings of the
changes, and keeping minutes of
Board of Directors and shareholders’ meetings, minutes
the board of directors and the
recording for meetings of the Board of Directors and
shareholders’ meetings.
shareholders’ meetings, assistance to Directors with taking
office and continuous education and training, provision of
information required for the Directors to conduct business,
assistance to Directors with compliance, and other matters
set out in the Company’s Articles of Incorporation or
contracts.
Key points for business execution in 2021:
1. Matters related to meetings of the Board of Directors
and shareholders’ meetings in accordance with the law.
2. Minutes recording for meetings of the Board of
Directors and shareholders’ meetings.
3. Assistance to the Directors with taking office and
continuous education and training.
4. Provision of the information required for the Directors
to conduct business.
5. Other matters set out in the Company’s Articles of
Incorporation or contracts.
Status of continuing education and training: A total of 15
hours of training was provided during the year. Please refer
to the table below.
Credit(s) from
Date Organization Course Credit(s) Individually
Traning
2021.05.06 Taiwan Institute of Directors Implement sustainable finance and move towards green finance 2.0. 3
Risk management of Anti-Money-laundering, Coun-ter-Terrorism-
2021.08.23 Taiwan Institute of Directors 3
Financing, and Principles for Treating Customers Fairly.
15
Corporate Operating and Sustainable
2021.10.27 Intellectual Property Rights and Corporate Gov-ernance. 3
Development Association
Corporate Operating and Sustainable Practice and case analysis for Corporate Gov-ernance, Board of Directors,
2021.10.29 3
Development Association and the Remuneration Committee.
2021.11.05 Securities and Futures Institute 2021 Avoid Insider Trading Seminar 3
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2021 Annual Report

III. Corporate Governance

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Implementation Status Deviations from
“the Corporate
Governance Best-
Evaluation Item Practice Principles
Yes No Abstract Illustration for TWSE/TPEx
Listed Companies”
and Reasons
V. Does the company establish a ✓ The Company has established a dedicated Stakeholder None
communication channel and build section on its website that provides the result of sustainable
a designated section on its website development in recent years and channels of communication
for stakeholders, as well as handle with stakeholders. The Company appropriately responds
to important sustainable development topics of concern of
all the issues they care for in terms
all stakeholders. The Company has set up communication
of sustainable development?
mailbox and hotline for investors, employees, suppliers,
customers, government authority, community, and NGO
as a communication channel. Dedicated personnel are
responsible for managing the mailbox and hotline. The
communication status and results with stakeholders will
be reported to Board of Directors on annual basis. The
communication status and results with stakeholders were
reported to Board of Directors on August 23, 2021.
A. Shareholders
Issues concerned: corporate governance, ethical business
operation, compliance, risk control/auditing, transparency
and disclosure of information, and operational
performance
Communication methods:
(1) Company information is provided through investor
emails and announcements on the official website.
The Company established "the investor section" on
our website to provide investors with transparent
and comprehensive information. The Company also
established the investor relations contact channel to
respond to questions raised by shareholders.
(2) Announcements of operations and financial
performance periodically and the issuance of material
information in Chinese and English on the Market
Observation Post System.
(3) Organization of one institutional investor conference
every season to report business status to shareholders.
B. Employees
Issues concerned: operational performance, employee
training, assessment, and development, employee
remuneration, working hours, labor-management
relations, communication channels, and occupational
safety and health
Communication methods:
(1) The employee suggestion mailbox and employee
complaint mailbox are used for communication.
(2) The Company organizes employee seminars every
month. The Company also announces internal news
reports and organizes large-scale family day events to
reward employees and facilitate communication and
employee exchanges.
C. Clients
Issues concerned: communication channels, customer
privacy protection and information security, brand image,
operational performance, service quality, and customer
satisfaction
Communication methods:
(1) The Company communicates with customers regularly
through the customer service hot line and email and
monthly statements are delivered every month.
(2) The Company organizes investment and wealth
management seminars periodically and organizes large-
scale investment seminars to communicate and interact
with customers.
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President Securities Corporation

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V. Does the company establish a D. Suppliers
communication channel and build Issues concerned: ethical business operation, risk
a designated section on its website control/auditing, and brand image
for stakeholders, as well as handle
Communication methods:
all the issues they care for in terms
of sustainable development? (1) The Company organizes periodic price negotiation
meetings, announces information on the public
tendering information section on the official website,
and organizes public tendering briefings.
(2) The Company has established the ‘Supplier Evaluation
and Management Regulations’ to evaluate suppliers.
The evaluations include preliminary, periodic, and
unscheduled evaluations and classify suppliers into A,
B, C, and D categories in accordance with the results of
the evaluations, which are used as the basis for future
cooperation.
(3) The Company cooperates with suppliers to jointly
commit to fulfilling sustainable development and
sign the ‘Sustainable Development Commitment
Letter.’ The materials used in decoration construction
and equipment procurement must be green building
materials and equipment with environmental protection
labels to increase the Company’s dedication to
environmental protection, energy conservation, and
carbon emissions reduction.
E. Competent authority
Issues concerned: ethical business operation, corporate
governance, transparency and disclosure of information,
financial and capital market functions maintenance, and
financial inclusion, and compliance of regulation.
Communication methods:
The Company participates in courses and seminars
organized by the government.
F. Community/NGO
Issues concerned: social welfare, responsible Investment/
sustainable finance, and environmental protection
Communication methods:
The Company organizes charity events every year.
The Company has established a stakeholder section and
sustainable development section on the official website
to explain the Company’s sustainable development ideas
and policies and describe the Company’s accomplishments
including the Company’s corporate governance, social, and
environmental achievements. The Company has formulated
the ‘Sustainable Development Report of President Securities
Corporation’ every year for publication on the Company’s
website (URL: www.pscnet.com.tw) and publication in the
Market Observation Post System.
VI. Does the company appoint a ✓ Affairs of shareholders' meetings are handled by the None
professional shareholder service Shareholder Services Department of the Company; the
agency to deal with shareholder Department obtained the certification of the Professional
affairs? Shareholder Services Institution from Taiwan Depository &
Clearing Corporation (TDCC).
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2021 Annual Report

III. Corporate Governance

Implementation Status Deviations from “the Corporate Governance BestEvaluation Item Practice Principles Yes No Abstract Illustration for TWSE/TPEx Listed Companies” and Reasons ✓ A. On President Securities Corporation website, we None have disclosed the Company’s financial and business information, and corporate governance. We also post periodical and non-periodical financial and operational information on the government-operated MOPS website. ✓ B. Our company has assigned a spokesperson to be None responsible for providing information to shareholders and investors. On our website where investors and shareholders can obtain information on the following: (1) Company introduction in English and Chinese. (2) Disclosure of company’s financial and business information, and corporate governance. (3) Investor Suggestion Mailbox, which is manned by Administration Department Personnel who are responsible for replying to all comments received. (4) The Company has disclosed the briefing and video files of institutional investor conference proceedings and other related information on the Company’s website. ✓ C. The Company currently announces and reports its annual Based on the evaluation, to financial report within 7 days before the time limit in disclose financial accordance with the relevant provisions of the Securities information in the and Exchange Act, and does not announce and reports its financial report fully and correctly, it is financial report in advance. not yet possible to complete its report in two months with the currently available human and system resources. ✓ A. Environmental Protection Measures None

VII. Information Disclosure

A. Does the company have a corporate website to disclose both financial standings and the status of corporate governance?
B. Does the company have other information disclosure channels (e.g. building an English website, appointing designated people to handle information collection and disclosure, creating a spokesman system, webcasting investor conferences)?

C. Does the company announce and release its annual financial report within two months after the end of the fiscal year, and announce and release financial reports for the first, second, and third quarters and operating conditions of each month earlier that the required date?

VIII. Is there any other important information to facilitate a better understanding of the company's corporate governance practices (e.g., including but not limited to employee rights, employee wellness, investor relations, supplier relations, rights of stakeholders, directors' and supervisors' training records, the implementation of risk management policies and risk evaluation measures, the implementation of customer relations policies, and purchasing insurance for directors and supervisors)?

President Securities operate financial services and, therefore, does not produce any environmental pollutants or waste.

B. Investor relations

Our company has assigned a spokesperson to be responsible for providing information to shareholders and investors, and to post periodical and non-periodical financial and operational information on the governmentoperated MOPS website. The Company established “the investor section” on our website to provide investors with transparent and comprehensive information. The company will continue to strengthen investor relations and maintain good communication and interaction with investors.

President Securities Corporation

Deviations from “the Corporate Governance BestPractice Principles for TWSE/TPEx Listed Companies” and Reasons

Implementation Status Evaluation Item Yes No Abstract Illustration

C. Employee rights and wellness

(1) To boost work efficiency and solidarity among our employees, we place particular emphasis on benefits programs and labor relations, and thus ensure employee welfare in a comprehensive manner.
(2) General accident insurance has been purchased for each of our branches and work premises so as to protect customer rights. Employer insurance has also been purchased so as to protect the interests of all employees.

D. Rights of the stakeholders

We have also taken steps to address corporate responsibility concerns of our stakeholders. We have established a platform with dedicated staff to handle feedback from investors, employees, clients, competent authority and community/NGO so as to maintain strong lines of communication and collect issues of concern of our stakeholders, and review whether our activities respond to stakeholders. This allows us to stay aware of the issues that are of importance to our interested parties and to ensure that all of our actions are responding to the needs of our stakeholders. The communication status and results with stakeholders will be reported to Board of Directors on annual basis. The communication status and results with stakeholders were reported to Board of Directors on August 23, 2021.

E. Customer policy
'' ''
(1) Policy: 3 Goods and 1 Fair" ─"Good Quality , ''Good Credibility'', ''Good Service'', and ''Fair Price''. This is combined with ''Professional Leadership, Kind Service'', in providing all customers with comprehensive services.
(2) Implementation: We have established a Customer Services Department—The Customer Service Center, which offers customers an avenue through which to register complaints, which operates a customer service hotline which is manned by customer service specialists who help to solve customer problems, and which ensures that all account correspondence sent to clients includes clear product risk warnings.

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F. Directors training

The Company's Directors shall carry out independent studies and the Company shall also organize related corporate governance courses periodically and invite all Directors to participate in the courses. Take 2021 for example, in addition to the Directors’ individual training courses, the Company cooperated with the Taiwan Institute of Directors to jointly organize classes for all directors and managerial officers of the Company. In May, the Company invited the executive director JT Chang from PRICEWATERHOUSECOOPERS Sustainability Services Company to give a speech on "Implementing sustainable finance toward Green Finance 2.0". In addition, Li, Yu-Hsun, a financial legal service attorney from PwC Legal, was invited to give a lecture entitled “Risk management of Anti-Money-laundering, Counter-Terrorism-Financing, and Principles for Treating Customers Fairly” in Augus, to enable the Directors to further understand the spirit of corporate governance and practice. For details of the Directors' on-the-job training in 2021, please refer to Chapter 3 XI. Directors and Corporate Auditors Training.

2021 Annual Report

III. Corporate Governance

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Implementation Status Deviations from
“the Corporate
Governance Best-
Evaluation Item Practice Principles
Yes No Abstract Illustration for TWSE/TPEx
Listed Companies”
and Reasons
VIII. Is there any other important G. Implementation status for Risk Management Policy and
information to facilitate a better Measurement:
understanding of the company's
corporate governance practices (1) Risk Management Policy
(e.g., including but not limited i. Ensure that we can operate various types of business
to employee rights, employee from a position of solid risk management. Using
wellness, investor relations, reasonable risk tolerance levels, continue to enhance
supplier relations, rights of profitability, create shareholder value, and achieve
stakeholders, directors' and return on capital targets.
supervisors' training records,
ii. Set well-defined risk controls for every business area,
the implementation of risk
implement risk management checks and balances, set
management policies and
clear obligations for each department so as to enhance
risk evaluation measures, the
risk management effectiveness by breaking it down
implementation of customer
into manageable pieces.
relations policies, and purchasing
insurance for directors and iii. Our risk management operations take into accounts
supervisors)? all key forms of risk: market risk, credit risk, liquidity
risk, operational risk, legal risk, model risk.
(2) Risk Measurement
The company has set risk management principles. In order
to ensure that all of our organization’s businesses adhere
to our operating policies, operating goals, and capital
levels, we have set suitability evaluation policies that can
react to changes in our business and in the market:
 Market risk measurement
i. We use RiskMetrics market risk management system
to manage our company’s exposure to market risk.
In addition to producing daily risk value tables, we
perform simulation analysis and historical analysis so
as to supplement missing risk values.
ii. We evaluate the completeness of our evaluation
models on various business mareas, and review the
assumptions, parameters, and data used for various
product models, and then test that the models for the
various products are reasonable.
iii. We evaluate the effectiveness of risk control
models: regularly perform backtesting to ensure the
effectiveness of the models used.
 Credit risk measurement
i. Our company undergoes credit rating evaluations from
Moody’s, Standard & Poor’s, Fitch, Taiwan Ratings
Corp, and TCRI.
ii. Trading counterparty credit risk: we assess our
company’s maximum exposure in the event that a
trading counterparty defaults, and then use maximum
exposure limits set by the board of directors, in
determining the credit risk of a trading counterparty.
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President Securities Corporation

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Implementation Status Deviations from
“the Corporate
Governance Best-
Evaluation Item Practice Principles
Yes No Abstract Illustration for TWSE/TPEx
Listed Companies”
and Reasons
VIII. Is there any other important iii. Issuer’s Credit Risk: we use KMV model to perform
information to facilitate a better internal evaluations, and combine that with financial
understanding of the company’s data and stock price data, to calculate the probability
corporate governance practices of a default. Then, based on these measurements, we
(e.g., including but not limited developed “Z-Score”, an in-depth internal evaluation
to employee rights, employee of the company, and then use this to protect ourselves
wellness, investor relations, from potential credit risks and potential capital
supplier relations, rights of shortfalls.
stakeholders, directors’ and
supervisors’ training records,  Operational risk measurement
the implementation of risk
i. Operational risk is the risk that occurs when internal
management policies and
processes, employees, or systems, are inappropriate or
risk evaluation measures, the
cause errors; or risk that is caused by external factors.
implementation of customer
This type of risk is related to legal risks but not
relations policies, and purchasing
insurance for directors and strategic risk or credit risk.
supervisors)? ii. We create operations risk policy handbooks that entail
every level of operations.
iii. Through our risk report and audit report, we ensure
that risk is appropriately evaluated, disclosed, and
controlled.
(3) Risk Management
Our risk management takes into account market risk,
credit risk, liquidity risk, operational risk, legal risk,
etc., for both on-balance sheet business and off-balance
sheet businesses. Each day, every level of operations,
every manager, and every trader is given fresh figures
on position risk and key sensitivity values. Through this,
the company’s risk controls and trading strategies can
be properly analyzed and necessary alerts can initiated.
Setting risk control guidelines for each level of operations
allows for comprehensive monitoring of risk.
(4) Our Risk Management Organization
As part of our risk control measures, we have created
an independent risk control department and constructed
an integrated risk control architecture that encompasses
all facets of the organization, including the Board of
Directors, the Risk Management Committee, the President
Office, the Assets/Liabilities Management Committee, the
Risk Control Office, the Auditing Office, the Compliance
Division, the Finance Department, the Business units and
Settlement & Clearing Department. Each segment of the
company has clearly spelled-out obligations and every
level of the company has clearly defined authorities.
i. Board of Directors: Audits the company’s risk
management policy, supervises sales business
strategies, approves all business proposals and
trading permissions, is ultimately responsible for risk
management.
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2021 Annual Report

III. Corporate Governance

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Implementation Status Deviations from
“the Corporate
Governance Best-
Evaluation Item Practice Principles
Yes No Abstract Illustration for TWSE/TPEx
Listed Companies”
and Reasons
VIII. Is there any other important ii. Risk Management Committee: Is a functional
information to facilitate a better established by the Board of Directors tasked
understanding of the company’s with integrating all risk management operations,
corporate governance practices with supervising and assisting all the various risk
(e.g., including but not limited management and related operations. The committee
to employee rights, employee is also tasked with setting the various risk authorities,
wellness, investor relations, limits, and targets, for a centralized supervision of the
supplier relations, rights of status of all of the company’s risk management efforts.
stakeholders, directors’ and iii. President Office: Supervises the daily implementation
supervisors’ training records, of all of the company’s risk management operations
the implementation of risk and authorizes any exceptions to the risk management
management policies and protocols.
risk evaluation measures, the
iv. Assets/Liabilities Management Committee: Controls
implementation of customer
the company’s overall asset structure, authorizes
relations policies, and purchasing
trading limits for businesses collects and analyzes
insurance for directors and
domestic and international interest rates, exchange
supervisors)?
rates, and economic changes.
v. Risk Control Office: Is responsible for the drafting
of risk policies and regulations, for monitoring
market and credit risks, for monitoring liquidity risks,
for compiling data on operational risk control and
management, for constructing and maintaining the
risk management system, for implementation of risk
management systems and for ensuring company-wide
regulatory compliance.
vi. Auditing Office: Sets operations risk controls, sets
the standards for risk control systems, puts in place
internal auditing controls, and implements daily check
routines.
vii. Compliance Division: Implements legal risk controls
and ensures that all businesses and risk management
operations are in compliance with relevant laws and
regulations. Compliance Division concurrently is
responsible for anti-money laundering and counter-
terrorist financing, developing relevant regulations and
systems, monitoring internal control and transactions,
supervising the implementation by business units,
holding training sessions, and reporting cases
suspicious of money laundering.
viii. Finance Department: Monitors capital adequacy rates
and liquidity risks, and analyzes the company’s asset/
liability structure and other key financial ratios.
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President Securities Corporation

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Implementation Status Deviations from
“the Corporate
Governance Best-
Evaluation Item Practice Principles
Yes No Abstract Illustration for TWSE/TPEx
Listed Companies”
and Reasons
VIII. Is there anyother important ix. Business units: Based on the company’s risk
information to facilitate a better management policies and regulations sets risk
understanding of the company's management guidelines for various businesses, and
corporate governance practices produces a report on abnormal risk items for the Risk
(e.g., including but not limited Control Office.
to employee rights, employee x. Settlement & Clearing Department: Implementation of
wellness, investor relations, risk control and management for settlement, clearing,
supplier relations, rights of and short-sale business operations. Implementation
stakeholders, directors' and of risk management and business department risk
supervisors' training records, management for transactions.
the implementation of risk H. President Securities has already purchased liability
management policies and insurance from ACE insurance and AIG Asia Pacific
risk evaluation measures, the
Insurance Pte. Ltd. for all of its directors, and key
implementation of customer
employees (Policy Value: US$10 million; Policy Term:
relations policies, and purchasing
insurance for directors and September 1, 2021, to September 1, 2022).
supervisors)?
IX. The improvement status for the ✓ In the Corporate Governance Evaluation of 2021, the None
result of Corporate Governance Company's final evaluation score was 87.93, placing
Evaluation announced by Taiwan the Company between 21% and 35% of the total listed
Stock Exchange. companies. In the previous evaluation, for any items
where the Company did not gain any points, such as
whether more than half of the directors of the Company
(including at least one independent director) and
the convener of the audit committee (or at least one
supervisor) attend the annual shareholders' meeting in
person. The Company will actively invite directors to
attend the shareholders' meeting. Has the Company
obtained ISO14001, ISO50001, or other similar
environment or energy management system verifications?
The Company originally planned to obtain ISO14001
external verification in 2021, but due to severe pandemic,
the containment measures restricted the movement of
office personnel and thus affected the internal audit
process, management audit meeting, and external
verification schedule. As a result, a management review
meeting was held on March 21, 2022, the external SGS
inspection was completed and successfully passed on
April 22, 2022, and the certification was expected to be
obtained in June.
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E. Composition, responsibilities, and operation of the Remuneration Committee

In accordance with the “Regulations Governing the Appointment and Exercise of Powers by the Remuneration Committee of a Company Whose Stock is Listed on the Stock Exchange or Traded Over the Counter” published by the competent authority on March 18, 2011, the Company has completed the discussion and resolution of the proposal by September 30, 2011, as required. Please refer to the description of the Remuneration Committee on page 54 of the Annual Report for the information on the operations.

2021 Annual Report

III. Corporate Governance

1. Information Regarding Remuneration Committee

Title	Criteria Name	Professional Qualifcation Requirements and Work Experience	Independence Criteria	Number of Other Public Companies in Which the Individual is Concurrently Serving as an Remuneration Committee Member
Independent Director (convener)	Pai, Chun-Nan	I graduated from the Institute of Economics at National Taiwan University and have a Ph.D. in Law from the Chinese Culture University; I have provided services in public and private enterprises for over 40 years and hold teaching position at National Taiwan University, National Taiwan Normal University, Soochow University, and Fu Jen University for teaching fnancial and economic courses. Currently, I am the Vice Chairman of China Petrochemical Development Corporation, Chairman of The First Leasing Corp., and the Independent Director of Megaforce Company Ltd., as well as a member of the Audit Committee and convenor Remuneration Committee of Megaforce Company Ltd. I am the Company's Independent Director and a member of the Audit Committee, Remuneration Committee, and Risk Management Committee (also the convenor). Not been a person of any conditions defned in Article 30 of the Company Act.	1. The Director, its spouse, or its relatives within the second degree of kinship not being a Director, supervisor, or employee of the Company or its afliates. 2. Th Director, its spouse, or its relatives within (or under other's names) the second degree of kinship has no shareholding in the Company. 3. Not being a director, supervisor, or employee of any company with particular relationships with the Company. 4. No compensation received from providing business, legal, fnancial, and accounting services to the Company or its afliates for the past two years. 5. According to the above, I complied with the independence criteria.	1
Independent Director	Liang, Yann-Ping	I have over fve years of working experience and professional fnancial and economics, as well as accounting expertise; I graduated from the George Washington University with an MBA, and possess extensive working experience in fnancial practices; I held positions as the Vice President of Hua Nan Investment Trust and Vice President of Polaris Securities Investment Trust; currently, I am the Associate Professor of Department of Finance at Shih Hsin University, Independent Director of President Securities Corporation, and a member of the Audit Committee, Remuneration Committee, and Risk Management Committee. Not been a person of any conditions defned in Article 30 of the Company Act.	1. The Director, its spouse, or its relatives within the second degree of kinship not being a Director, supervisor, or employee of the Company or its afliates. 2. Th Director, its spouse, or its relatives within (or under other's names) the second degree of kinship has no shareholding in the Company. 3. Not being a director, supervisor, or employee of any company with particular relationships with the Company. 4. The compensation received from providing business, legal, fnancial, and accounting services to the Company or its afliates for the past two years was NT$0. 5. According to the above, I complied with the independence criteria.	0
Independent Director	Horng, Yuan- Chuan	I have over fve years of working experience in fnance and accounting; I graduated from the Department of Economics, Soochow University; currently, I am the Independent Director of Himax Technologies, Inc.; I held positions as the Vice President of Finance Division of China Steel Corporation and Chairman of Gains Investment Corp.; I am the Company's Independent Director, and a member of the Audit Committee, Remuneration Committee, and Risk Management Committee.	1. The Director, its spouse, or its relatives within the second degree of kinship not being a Director, supervisor, or employee of the Company or its afliates. 2. Th Director, its spouse, or its relatives within (or under other's names) the second degree of kinship has no shareholding in the Company. 3. Not being a director, supervisor, or employee of any company with particular relationships with the Company. 4. Not provided business, fnancial, and accounting services to the Company or its afliates for the past two years. The compensation was NT$0. 5. According to the above, I complied with the independence criteria.	1
Independent Director	Song, Yung-Fong	I have over 30 years of working experience and professional business management, business, legal, and accounting expertise; I graduated from The University of Iowa; after graduating with MBA, I held management positions in major investment banks or foreign-invested banks worldwide, such as holding positions as Vice President, Managing Director, and Executive Director at BNP Paribas Taiwan, Goldman Sachs (Asia), SG Warburg Securities Ltd. Taiwan, Deutsche Bank Taiwan, ABN AMRO Bank (Taipei Branch), and CIMB Securities, Taiwan, and became the CIO and Executive Vice President of Chunghwa Telecom Co., Ltd. in 2017. Currently, I am the Company's Independent Director and a member of the Audit Committee, Remuneration Committee, and Risk Management Committee.	1. The Director, its spouse, or its relatives within the second degree of kinship not being a Director, supervisor, or employee of the Company or its afliates. 2. Th Director, its spouse, or its relatives within (or under other's names) the second degree of kinship has no shareholding in the Company. 3. Not being a director, supervisor, or employee of any company with particular relationships with the Company. 4. The compensation received from providing business, legal, fnancial, and accounting services to the Company or its afliates for the past two years was not more than half a million. 5. According to the above, I complied with the independence criteria.	0

President Securities Corporation

2. Operations of the Remuneration Committee

(1) The committee is composed of four members.
(2) Term of the committee members: From July 28, 2021 through July 20, 2024. The Remuneration Committee met 6 times
(A) in the most recent year. The qualifications and attendance of the members are listed below:

Title	Name	Attendance in Person (B)	By Proxy	Attendance rate (%) (B/A) (Note)	Remark (Note)
Convener Pai, Chun-Nan 6 0 100% Reappointment on 2021.7.28
Member Liang, Yann-Ping 6 0 100% Reappointment on 2021.7.28
Member Horng, Yuan-Chuan 6 0 100% Reappointment on 2021.7.28
Member Song, Yung-Fong 6 0 100% Reappointment on 2021.7.28
Other mentionable items: 1. If the board of directors declines to adopt or modifies a recommendation of the remuneration committee, it should specify the date of the meeting, session, content of the motion, resolution by the board of directors, and the Company’s response to the remuneration committee’s opinion (eg., the remuneration passed by the Board of Directors exceeds the recommendation of the remuneration committee, the circumstances and cause for the difference shall be specified): None. 2. Resolutions of the remuneration committee objected to by members or expressed reservations and recorded or declared in writing, the date of the meeting, session, content of the motion, all members’ opinions and the response to members’ opinion should be specified: None.

(3) 2021 remuneration committee proposal discussion and resolution:

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Remuneration Committee Item Resolution
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Remuneration Committee	Item	Resolution

2021.03.11 The 15th Meeting of the 4th Remuneration Committee 2021.04.22 The 16th Meeting of the 4th Remuneration Committee 2021.04.29 The 17th Meeting of the 4th Remuneration Committee	1. The proposal for 2020 bonus distribution ratio for employees and directors. 2. The proposal for 2020 bonus allocation for employees and directors.	Proposal 1~2: All members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.
	1. Amendments to the Board of Directors Performance Evaluation Measures. 2. The proposal for 2020 bonus distribution to employee and managerial officers.	All members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion. Other supplementary descriptions: At present, the Company has three committees (the Audit Committee, the Remuneration Committee and the Risk Management Committee). The Company may consider and evaluate whether other committees need to be added, such as the Operating Management Committee and the Nomination Committee. Proposal 2: All members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion.
	The committee members understood and discussed the system for the appointment of corporate consultants and the promotion of non-executive vice presidents.	The conclusion of this meeting shall be reported to the Board for review and no resolution is required.

2021 Annual Report

III. Corporate Governance

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Remuneration Committee Item Resolution
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Remuneration Committee	Item	Resolution

2021.06.10 The 18th Meeting of the 4th Remuneration Committee	There were only reports and no resolutions at this meeting.
2021.08.10 The 1th Meeting of the 5th Remuneration Committee	1. Election matters: Regarding the nomination and election of the convener of the "Remuneration Committee," a proposal is submitted for discussion. 2. Periodic review and evaluation of the policy and structure of the remuneration provided to the Company's Directors. 3. Propose the remuneration for the 12th term of Board of Directors. 4. Propose the remuneration for the 12th term of Independent Directors. 5. Propose the remuneration for the 12th term of Chairman. 6. Remuneration of the President. 7. Change of managers. 8. Newly created department organization and promotion of employees.	Proposal 1: The Remuneration Committee members elected Pai, Chun-Nan as the convener and Chairman of the Remuneration Committee. The Committee has passed a resolution for the election. Proposal 2: All members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion. Proposal 3: All members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion. Proposal 4: This case involves recusal and shall be submitted to the Board for resolution. Proposal 5~7: All members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion. Proposal 8: The case is to be discussed after supplementary materials are provided.
2021.10.21 The 2th Meeting of the 5th Remuneration Committee	1. Change of manager of the Company. 2. Setting up a chief information security officer. 3. Periodic review and evaluation of the policies and structure of the remuneration to the Company's senior executives and managerial officers.	Proposal 1~2: All members of the committee present voted in favor of the resolution without any objection and submitted it to the Board of Directors for discussion. Resolution 3: The proposal below was proposed by all the members present and approved as proposed. Explanation: Based on risk management, recommend to include risk obligation as consideration factors in bonus payment.

F. Sustainable development and Deviations from “ Sustainable Development Best Practice Principles for TWSE/GTSM Listed Companies ”

Evaluation Item		Implementation Status	Implementation Status	Implementation Status	Deviations from Sustainable Development Best Practice Principles of TWSE/GTSM Listed Companies” and Reasons
		Yes	No	Abstract Explanation
I. Has the company established a dedicated unit or appointed a unit for promoting SD? Is the unit authorized by the Board of Directors to implement SD activities at upper management levels? Does the unit report the progress of such activities to the Board of Directors?	✓ The Company’s SD was implemented by the Management Department where SD integration teams are formed, including a corporate governance promotion team, a customer service promotion team, an employee care promotion team, an environmental protection promotion team, and a social participation promotion team. They are responsible for proposal and implementation of SD policies, systems, relevant management policies, and specific implementation plans. They organize social responsibility events and activities, including social contribution, social welfare, and community participation events each year and each year regularly hold three integration meetings to set goals, manage implementation, and review performance for various areas, while compiling the documentation of implementing the performance of SD for the year into a SD report. They also formulate SD policies, which should be approved by the Board of Directors, and the results of implementation by all relevant units are reported to the Board of Directors within four months once a year after the end of each year. None

President Securities Corporation

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Implementation Status Deviations from
Sustainable Development
Evaluation Item Best Practice Principles
Yes No Abstract Explanation of TWSE/GTSM Listed
Companies” and Reasons
II. Does the company conduct ✓ The Company’s sustainable development (SD) is implemented None
risk assessments related by the Management Department, which is responsible for the
to environmental, social, formulation and implementation of sustainable development
and corporate governance policies, systems, or relevant management guidelines and specific
issues that are related to implementation plans. Each year, the department organizes
the company’s operations sustainable development events and activities, including social
in accordance with the contributions, social welfare, and community participation, and
materiality principle, and formulates SD policies, which are approved by the Board of
formulate relevant risk Directors; the results of the implementation by relevant units are
management policies or reported to the Board of Directors within four months once a year
strategies? after the end of each year.
The Company conducts risk assessments on environmental, social,
and corporate governance issues related to its corporate operations
in accordance with the materiality principle. Relevant policies are
formulated for issues of materiality identified, as detailed in the SD
report.
Main Topic Assessment Risk Management Policies and Strategy
The company is developing policies and strategies designed to address risk factors related to climate, such as heavy rain events, earthquakes, and high
temperatures with the goal of maintaining the safety and robustness of the Company's operations. For example, the low-carbon transformation policy on
the client side includes the full development of digital financial management. This includes the availability of online signing of a wide variety of consent
Climate documents and risk notices required by the appropriate authorities for opening accounts remotely, conducting various transactions directly on mobile
Environment change and devices, and online inquiry used to confirm whether a transaction has been conducted successfully. The goal is to make sure the Company's services will
environmental not be affected by climate change and other related events or disasters. As for the Company's operations, the Company will comprehensively review
protection business processes and convert administrative forms into electronic documents, purchase environmentally-friendly labeled products, phase out older
energy-consuming equipment year by year to reduce energy consumption, streamline energy expenditures, improve operational efficiency, and hire
an external certification agency to formally introduce and complete the IOS14064-1 standard for greenhouse gas inventory. The goal is to reduce the
generation of a carbon footprint through such interlocked low-carbon operations.
The Company pays attention to the safety of employees' work environment. In addition to minimizing the hazards present in the office environment, the
Head Office and all branches have selected and assigned appropriate employees to obtain Fire Safety Manager Certificates and the become qualified as
Occupational category B labor occupational safety and health supervisors, while formulating fire-fighting plans for the workplace, to maintain a safe office environment.
safety and The Company's Head Office and workplaces have each purchased public accident liability insurance to protect rights and interests of clients and to provide
health employer accident liability insurance to protect employees' rights and interests. A total of four automated extracorporeal defibrillators (AEDs) have been
set up on specific floors of the Company's Head Office building, and a total of 37 employees have obtained first-aid safety and health education along with
training certificates in 2021 to ensure the safety of their peers.
In addition to the independent operation of finance and business, the management rights and responsibilities of the Company and affiliated companies
are clearly divided, and their business dealings or transactions are handled in accordance with the relevant laws and regulations. In addition, an "Internal
Control System for Supervision and Management of Subsidiaries" has been established to control and manage subsidiaries. The Information System
Social issues Department of the Company has formally established an information security section assigned to upgrading the previous task-based team to a normal
organization. This section is staffed with a dedicated information security supervisor and two dedicated information security personnel to strengthen the
Customer maintenance, security, and control of the information systems and the stability of business adjustment The goal is to ensure that the organization carries out
privacy information security management operations effectively and provides clients with the most secure information trading environment.
protection and Since August 2013, the Company has applied for and obtained the British Standards Institution's ISO 27001: 2005 version of the information security
information certification for electronic trading systems. It passed the information security certification renewal and obtained the revised ISO 27001: 2013 version
security of the certification at the end of July 2014. Afterwards, the Company has applied for renewal of the certification annually and applied for review of the
certification every three years (2016 and 2019) to implement the Company's internal matters in a standard and systematic manner to reduce operational
errors. The Company has adopted TWCA as the certificate authority for authentication and verification of orders placed. When clients are conducting
online transactions, in addition to having the account number and password checked by a securities firm or a futures firm, each transaction needs to be
confirmed with a certificate issued by an impartial third party, along with the use of internationally recognized SSL technology for transmission encryption,
to increase the degree of security that is valued during online transactions.
The Company's Board of Directors has established a Risk Management Committee to supervise daily risk management affairs effectively. The risks
involved in the Company's business include risks related to the market, credit, liquidity, operations, legal issues, and model risks, which have been included
in the scope of risk management. In addition, a three-stage defense system for risk management has been implemented.
Corporate governance Risk control/audits The first-stage defense: When each business unit executes its business, it will monitor risks on its own.The second-stage defense: An independent dedicated unit has been established to formulate and execute risk policies, operating guidelines, and risk control
systems as the second-stage of defense in the monitoring of risks.
The third-stage defense: The risk management system is integrated into the internal audit system to provide for independent review.
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Implementation Status Deviations from
Sustainable Development
Evaluation Item Best Practice Principles
Yes No Abstract Explanation of TWSE/GTSM Listed
Companies” and Reasons
III. Environmental Issues
A. Does the company endeavor ✓ A. The Company is a financial services industry with no pollution None
to utilize all resources more and waste generated from manufacturing activities. The main
efficiently and use renewable source of greenhouse gas emissions is purchased electricity
materials which have low impact
consumption. In order to implement environment protection
on the environment?
and carbon emission reduction, the Company has implemented
several energy consumption equipment replacement projects.In
2022, in order to protect the natural environment, demonstrate
the organization's improved environmental performance, achieve
a balance between the environment, society, and the economy,
and to achieve social expectations related to sustainable
development, transparency, and responsibility, the Company
started to implement ISO 14001 environmental management
system since the second half of 2021. The environmental
operation control procedure was established, implementing,
maintaining, periodically reviewing, and communicating with
internal and external stakeholders within defined scope. External
verification of ISO14001 environmental management system
will be conducted in 2022.
B. Does the company establish ✓ B. The Company spares no efforts in supporting green None
proper environmental environment protection. In order to implement the
management systems based sustainability policy of waste reduction, the Company placed
on the characteristics of their resource recycling bins at every floor of the Company and
industries? strictly and completely enforced garbage sorting and recycling.
In addition, the Company purchases products that have energy
conservation labels, environmental protection labels, green
building materials labels and so on to reduce the impact of the
Company’s operation on the environment and society. In terms
of environmental protection and waste reduction, the Company
enhanced the promotion of resource recycling, digitalization of
various forms in offices, and external paperless policies, such
as the implementation of customer e-statements and electronic
order placement, and began an inventory taking of garbage
quantity. In 2020, there were 41,071 kg of recyclable paper and
74,970 kg of unrecyclable waste. In 2021, there were 27,920 kg
of recyclable paper and 75,140 kg of unrecyclable waste. Paper
has reduced 13,151 kg comparing to previous year, which is
a reduction of 69,568.79 kg carbon emission. The Company's
objective for environment protection, energy saving, and
carbon emission reduction is achieved. In 2021, the Company
has purchased NT$486,936 green construction materials.
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Implementation Status Deviations from
Sustainable Development
Evaluation Item Best Practice Principles
Yes No Abstract Explanation of TWSE/GTSM Listed
Companies” and Reasons
C. Does the company evaluate the ✓ C. In response to the effects of extreme climates on the planet, None
current and future potential risks introduced 14001 Environmental Management System which
and opportunities created by identified “climate change and environmental protection” as
climate change for the company the risk of all environmental aspects of President Securities
and take measures to respond to Corporation. We are considering how to respond to climates
climate-related issues? and how to convert risk factors into business opportunities for
President Securities Corporation! Low-carbon transformation
has become the opportunities of the Company’s policy on
environmental sustainability. We devote ourselves to the
development of digital financial management to achieve the
goal of low-carbon transformation. Formulate action plans
for paperless operations.In response to the government’s
energy and environmental policies and regulations, we will
strive to achieve sustainable environmental development, The
Company formulated the environmental management action
plan, including the aspects of energy management, planned
the lighting replacement plan, equipment maintenance and
inventory check in noise control aspect, establishment of
replacement standard to gradually replace air-conditioning
equipment.We will carry out various regular reviews
to continuously improve our performance as related to
environmental issues. We are committed to providing relevant
resources designed to continue to promote the following
environmental policies.
i. Develop a digital financial system to reduce the generation
of a carbon footprint.
ii. Require the purchase of green-marked products and strictly
request procurement of local products.
iii. Promote environmental protection management policies
regularly and continue to improve our commitment to the
environment and wise energy use.
D. Has the company measured its ✓ D. In an effort to reduce our carbon footprint, the Company None
greenhouse gas emissions, water adheres to government policies on indoor climate controls, as
consumption, and total weight well as removing and replacing outdated equipment with more
of waste in the past two years, energy-efficient models, followed-up by regular inspections.
and formulated policies related In order to conserve energy as well as to reduce carbon and
to energy conservation, carbon greenhouse gas emissions, when preparing annual budgets,
reduction, greenhouse gas the Company includes the costs of water and electricity that
reduction, water consumption, affect greenhouse gas emissions in the management report.
or other waste management? The company regularly encourages employees to reduce
the use of elevators as much as possible and adjusts water
pressure to reduce water consumption. In order to effectively
control greenhouse gas emissions, the Company has obtained
ISO14064-1 greenhouse gas inventory system certification
and expects to obtain ISO 14001 environmental management
system certification in 2022.
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Implementation Status Deviations from
Sustainable Development
Evaluation Item Best Practice Principles
Yes No Abstract Explanation of TWSE/GTSM Listed
Companies” and Reasons
D. Has the company measured its In 2020, the Company’s headquarters consumed 13,172 cubic
greenhouse gas emissions, water meters of water which accounts for 764 kg carbon emissions,
consumption, and total weight and 1,473,672 kilowatt-hours of electricity which accounts for
of waste in the past two years, 750,099 kg emissions.
and formulated policies related
In 2021, the Company’s headquarters consumed 16,630 cubic
to energy conservation, carbon
meters of water which accounts for 921.3 kg carbon emissions,
reduction, greenhouse gas
and 2,399,622 kilowatt-hours of electricity which accounts for
reduction, water consumption,
1,329,390 kg emissions.
or other waste management?
We shall continue to promote environmental protection
awareness among colleagues and it has established a goal of
reducing carbon emissions by 1% in 2022 to build a greener
enterprise.
The Company is committed to environmental protection
and has set up waste reduction KPIs. The “Environmental
Management Implementation Committee” has introduced
ISO14001 environmental management system for management,
implementation and audit, In 2020, there were 74,970 kg of
general waste and 41,071 kg of recyclable waste. In 2021, there
were 75,140kg of general waste and 30,588kg of recyclable
waste. General waste volume for office dining increased due to
the impact of pandemic, and has not reached the objective of
waste reduction.
IV. Social Issues
A. Does the company formulate ✓ A. 1.On December 16, 2020, the Company has established None
appropriate management "President Securities Corporation Human Right Policy" based
policies and procedures on the human right protection spirit and principles disclosed
according to relevant regulations by UN Universal Declaration of Human Rights, the UN Global
and the International Bill of Compact, and ILO Convention. The Company is devoted
Human Rights? to protecting basic human rights.The Company’s human
right policy covers eight major aspects, including workplace
inclusion, maternity protection, child labor employment,
discrimination and sexual harassment, occupational safety
management, employee health management, overtime work
and labor disputes. Management and alleviation measures have
been set up for each aspect.
2.The Company has also established the labor health protection
plan, which contains the ergonomic prevention plan, prevention
plan for unlawful infringement during work and the prevention
plan for diseases due to abnormal workload. In addition to
regular annual promotion of the Sexual Harassment Prevention
Act, the Company has held promotional seminars on labor
rights in 2021 and produced audio and video materials on
labor rights for employees to understand their rights online at
any time.The Company arranges annual health checkups for
its employees. All of the above measures are means to protect
employees' basic human rights.
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Implementation Status Deviations from
Sustainable Development
Evaluation Item Best Practice Principles
Yes No Abstract Explanation of TWSE/GTSM Listed
Companies” and Reasons
D. Does the company provide ✓ D. To face the financial market trend, the Company has held None
its employees with career a series of courses focusing on FinTech issues, such as
development and training RPA process automation machine, BA(Business Analyst)
sessions? workshops. The Company also developed different training
programs for each job category, such as wealth management
operation capability training, branch company management
report analysis and practice, management trainee talent
fostering, channel trainee talent fostering, internal lecturer
training, management function enhancement training, etc.
The Company continuously enhance employees' professional
knowledge and skills through the development of level-wise
function capability.
E. Does the company comply ✓ E. The Company implements personal data protection and None
with relevant laws, regulations, management measures, abides by the relevant provisions of
and international standards the Personal Data Protection Act, and protects customers’
related to customer health and rights in terms of their personal data. This is designed to
safety, customer privacy, as reduce the impact of infringement on any personal data
well as marketing and labeling files, while continuing to operate and improve the personal
of products and services, and data management system. A personal data protection policy
does the company formulate statement was issued in 2012. The company-wide “Education
relevant protection policies and Training Session on the Personal Data Protection Act”
of consumers’ rights and is offered at least once a year, and a test will be given after
interests as well as complaint each session to examine the learning efficacy of participants
procedures? and to ensure that employees have a full understanding of the
importance of protecting personal data and understands the
operating regulations related to personal data.
The Company adheres to financial product responsibility and
sales ethics, and has developed and publicized its consumers’
rights and interest policy, and implemented the execution
of policies on consumers’ rights and interests. In 2021, the
Company has won "Significant progress award for excellent
securities companies" through fair customer treatment principle
by Financial Supervisory Commission.
In order to provide customers with the most comprehensive
services, the Company has a dedicated customer service
department—the Customer Service Center, which provides
customers with complaint channels, dedicated lines, and
dedicated personnel to help customers solve their problems.
The Customer Service Center is designed to ensure that
the Company provides high quality and reliable services
to customers. Through the three major operating aspects
(personnel, systems, and processes) and the support of superior
service systems, customers’ needs can be effectively addressed.
In the process of providing services, when problems are
discovered the processes are constantly improved. The goal is
to improve customers’ satisfaction with their interaction with
the Company, so that the management of customer relationships
can reach the best possible state.
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President Securities Corporation

		Implementation Status	Implementation Status	Implementation Status
Evaluation Item		Yes	No	Abstract Explanation
F. Has the company formulated supplier management policies that requires suppliers to follow relevant regulations on issues, such as environmental protection, occupational safety and health, or labor rights? How are these policies implemented?	✓ F. In order to maintain the quality of suppliers’ services, the Company conducts assessments of its existing partner’s operations in accordance with the Supplier Evaluation and Management Regulations each year. This effort is divided into initial, regular, and irregular evaluations; the results can be divided into four-levels of suppliers, namely levels A, B, C, and D, as the basis for considerations for future cooperation. In addition, the Company has required its main suppliers to sign a “Supplier Social Responsibility Commitment Letter.” The suppliers are clearly committed to complying with international human rights conventions and labor laws, providing employees with a fair, healthy, and safe workplace environment, prohibiting discrimination and unequal differential treatment, and complying with relevant environmental protection regulations. For suppliers who violate this commitment letter, the Company may request termination of the related contract or suspension of the partnership. In 2021, the total of 89% of the suppliers have signed a commitment letter. Included ISO14001 Environmental Management System education training program in the implementation of environmental management system. None
V. Does the company refer to the international common reporting standards or guidelines to compile reports, such as sustainable development reports that disclose the company’s non-financial information? Have the quality of the said reports been confirmed a third-party verification entity? In 2011, the Company published its first “2010 Sustainable Development Report of President Securities Corporation”, and has produced subsequent annual reports ever since. The reports are available online for download at the Company’s corporate website, www.pscnet. com.tw. Our corporate sustainable development report for 2020 was published in July 27th, 2021 and was certified by a third party (PwC Taiwan), using the “Non-Financial Information Auditing and Certification Letter” format suggest the report is in compliance with the GRI Standards and that covers all items required by GRI Standards reporting policies.
VI. If the Company has established the sustainable development principles based on “the Sustainable Development Best-Practice Principles for TWSE/TPEx Listed Companies”, please describe any discrepancy between the Principles and their implementation: For the implementation of the corporate governance, the Company’s Board of Directors approved the "President Securities Sustainable Development Best practice Principles" on July 2, 2012. Implemental reports of "President Securities Sustainable Development " were proposed in board meeting every year, and report of the year 2021 was proposed in the 4th meeting of the 12th Board of the company.

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VII. Other important information to facilitate better understanding of the Company’s sustainable development practices: A. Environmental Protection Measures Although the Company is a securities firm that does not produce any environmental pollutants, we still care deeply about protecting the environment, about reducing our impact on the environment, and about our responsibility for sustainability. In order to properly protect the natural environment, demonstrate the organization’s improved environmental performance, achieve a balance between the environment, society, and the economy, and to achieve social expectations related to sustainable development, transparency, and responsibility. ISO14001 Environmental Management System was introduced in 2021. ISO14001 Environmental Management System Certification will be carried out in 2022. ISO14001 Environmental Management System Certification and ISO14064-1 Greenhouse Gas Inventory is expected to be obtained this year. B. Participation in Public Service President Securities Corporation has been a long-standing supporter of important social charitable activities and, for its efforts, has been recognized with the 7th annual Wenxin Award and the 6th National Civic Service Award, and Top 50 by the Commonwealth magazine in 2013, 2015, 2016, and 2017. Besides, the Company was recognized and reward by the Taiwan Fund for Children and Families in 2013. President Securities Corporation has won the Gold Award in the Finance and Insurance Industry of the Corporate Sustainability Report Awards of the Taiwan Corporate Sustainability Awards (TCSA) for consecutive two years(2020 and 2021). This represents the highest honor in Taiwan’s Sustainable Development report. The Company was also awarded 2021 Taiwan sustainable enterprise excellent award. The Company won 2021 TSAA Taiwan Sustainability Action Award-Bronze medal, was nominated by 2021 5th PWC CSR Influence Award, and Business Today 15th wealth management bank and securities companies "Best sustainable development Award" by "PSC donates to Child Welfare League Foundation for every order you place". The Company has taken concrete actions to cooperate with the Taiwan Fund for Children and Families from 2007 to 2021 to help children from financially challenged families with their studies. The Company also mobilized all employees and customers for joint participation and invested actual funds and various equipment to social welfare activities to fulfill sustainable development. The Company made a donation of NT$2.5 million to the Taiwan Fund for Children and Families providing schooling subsidies in 2021 in the theme of “Love Will Not Die During Pandemic Prevention”. Since 2001, The Company has held "“Love Delivery Activities" for consecutive 21 years. The target of the charity is children from financially challenged families supported by Taiwan Fund for Children and Families that provide children from financially challenged families with scholarships. A total of approximately 10,077 elementary school, junior high school, and senior high school students were beneficiaries. The activities have provided school children from poor families with opportunities to explore different academic disciplines for their own development and growth. An employee blood donation event was held for the first time in 2006 and received an enthusiastic response. Since 2007, the Company has held an employee blood donation event twice a year and extended it to the wider community, which has received a widespread positive response from community residents. Since 2010, the Company has held a blood donation event three times a year. Due to the effects of the COVID-19 pandemic in 2021, the blood donation events were suspended. From 2006 to 2019, a total of 3,517 units of blood had been donated. As a partner of blood donation centers, the Company has been commended by the blood donation centers every year. The Company launched "PSC donates to Child Welfare League Foundation for every order you place" charity activity in 2021. NT1.1 million was donated to Child Welfare League Foundation Little Helmsman Education Program. The Company participated the minority care public welfare activity held by Uni-President Corporation’s foundation to donate 400 Epidemic prevention kits to the elderly and schoolchildren to fulfill social responsibility. President Securities Corporation upholds the spirit of “giving back to the community what we take”, and we continue to dedicate ourselves to helping disadvantaged groups and to promote social welfare activities.

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C. Customer Rights We have assigned a spokesperson to be responsible for providing information to shareholders and investors, and for posting periodical and non-periodical financial and operating information on the government-operated MOPS website. We have also setup an "Investor Section" on our website where investors and shareholders can obtain information on the following: (1) President Securities’ design and sale of financial products adheres to all relevant laws and regulations. (2) Company introduction in Chinese and English. (3) Company financial statements. (4) Board of Director meeting Minutes. (5) Investor Suggestion Box, which is manned by Public Affairs personnel who are responsible for replying to all comments received. D. Employee Rights and Hiring Concerns (1) To boost work efficiency and solidarity among our employees, we place particular emphasis on benefits programs and labor relations, and thus ensure employee welfare in a comprehensive manner. (2) General accident insurance has been purchased for each of our branches and work premises so as to protect customer rights. Employer insurance has also been purchased so as to protect the interests of all employees. E. Rights of the stakeholders The Company respects rights of the stakeholders in expressing their opinions and has established a stakeholder section on the official website to build up a communication channel and to explain the Company’s sustainable development ideas and policies. For investors, employees, suppliers, customers, competent authority and community/NGO, the Company has established a communication platform, on which there are dedicated personnel to respond to any questions, to maintain good communication with the employees. F. Customer policy (1) Policy: “3 Goods and 1 Fair” ─ “Good Quality”, “Good Credibility”, “Good Service”, and “Fair Price”. This is combined with “Professional Leadership, Kind Service”, in providing all customers with comprehensive services. (2) Implementation: We have established a Customer Services Department—The Customer Service Center, which offers customers an avenue through which to register complaints, which operates a customer service hotline which is manned by customer service specialists who help to solve customer problems, and which ensures that all account correspondence sent to clients includes clear product risk warnings.

G. Ethical business operation at the Company and related implementation and Deviations from “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”

1. Ethical business operation

Our company has always applied the principle of “integrity and sustainable management”, to serve our customers sincerely. We also inherit the spirit of “3 Goods and 1 Fair”. We protect clients’ rights with flawless service. We pursue long-term, steady and balanced growth in the spirit of integrity management.

(1) The company has established “Ethical Corporate Management Best Practices Principles”, “Guidelines on Ethical Business Practice and Practice”, and “Fair Client Treatment Principles”, and strives to adhere to these concepts.
(2) Insure company directors, supervisors, and managers’ liability insurance, also employees’ credit insurance.
(3) The Company is active in participating in community activities, and in fostering sustainable development sustainable development.

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Implementation Status Deviations from the
Ethical Corporate
Evaluation Item Management Best
Yes No Abstract Illustration Practices Principles
for TWSE listed
companies and reasons
I. Establishment of ethical corporate
management policies and programs
None
A. Does the company declare its ethical ✓ A. (1) On August 23, 2012, the Board of Directors issued
corporate management policies and "Ethical Corporate Management Best Practice Principles"
procedures, formulate the Ethical and revealed the principle in 2013 shareholders’ meeting.
Corporate Management Policy This proves the management’s commitment to Integrity
approved by the Board of Directors management. And in March 2020, the Board of Directors
has been formulated, and, in its approved the establishment of an ethical corporate
guidelines and external documents, as management task force which served under the Board of
well as the commitment from its board Directors. In August 2020, the Board of Directors approved
and management level to implement the establishment of "Guidelines on Ethical Business
the policies? Practice and Practice" . In addition, the Company’s 2020
Sustainable Development report delivers information
regarding the Company’s efforts in and contributions to
fulfilling its social responsibilities to stakeholders. The
Company’s senior management and board members are
responsible during supervision in line with the principle
of integrity in the execution of business, in order to
create a business environment in support of sustainable
development.
(2) The Company’s Directors, Chairman, President,
heads of departments and consultants have all signed
the Statement of Compliance with Ethical Corporate
Management Policy.
B. Has the company established an ✓ B. The Company has explicitly prohibited any direct or None
assessment mechanism designed to indirect offering, promising, requesting, or receiving of any
address the risk of unethical conduct, improper benefits.
regularly analyzed and evaluated
In addition to the Code of Ethical Business Practice, the
business activities with a high risk of
"Guidelines on Ethical Business Practice and Practice" was
unethical conduct within the business
updated in August, 2020 to prevent dishonesty. In addition
scope, as well as formulated unethical
to what is set out in the ethical Corporate Management
conduct prevention programs
Best Practice Principles, the Company has clearly
accordingly? Such measure should at
stipulated measures in the work rules that are designed
least covers activities stated in Article
to facilitate the adoption of preventive measures and the
2, Paragraph 7 of the ethical corporate
Company offers education sessions, to implement the
management best-practice principles
ethical corporate management policy.
for TWSE listed companies.
C. Does the company establish policies ✓ C. To execute integrity management and prevent dishonesty, None
to prevent unethical conduct with the company adds related rules to corporate governess
clear statements regarding relevant (Chapter 10 article 48) in 2012, which authorized by the
procedures, guidelines of conduct, Ministry of Labor and publicly announced. Later in 2016,
punishment for violation, rules of the Company established Measures for Whistle-blowing
appeal, the commitment to implement related to Illegal and Unethical Conduct and revised
the policies, and reviewe/ revise the these documents related to the Measures for Reporting of
policies regularly? Illegal and Unethical Conduct in 2019. Also, formulated
the procedures for ethical management and guidelines
for conduct in August, 2020 in order to implement the
Company’s work rules and ethical corporate management
principles, the Company has encouraged the reporting of
any illegal and unethical conduct as well as established
internal and external reporting channels and processing
procedures of the Company to ensure integrity and ethical
conduct within the Company.
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Implementation Status Deviations from the
Ethical Corporate
Evaluation Item Management Best
Yes No Abstract Illustration Practices Principles
for TWSE listed
companies and reasons
II. Fufill ethical management
A. Does the company evaluate business ✓ A. Before engaging in any business relationship with any agent, None
partners’ ethical records and include supplier, customer, or any other enterprise, we conduct
ethics-related clauses in business a thorough examination of that party’s creditworthiness,
contracts? so as to avoid entering into any transactions with non-
creditworthy parties. Included in all agreements with third
parties are provisions which allow for the early termination
of such agreement in the event of any deceitful acts by that
party.
B. Does the company establish an ✓ B. The Company has established the “Ethical Corporate None
exclusively dedicated unit supervised Management Practice Team” under the Board of Directors
and appointed the supervisor of Administration Department
by the Board to be in charge of
as the convener, who is responsible for assisting the Board
corporate ethical management, and on
and the management level to establish and supervise the
a regular basis (at least once a year),
implementation of ethical corporate management policies
report the status of unethical conduct
and protective measures and to ensure the execution of
prevention programs, and the status of
Ethical Corporate Management Best Practice Principles. The
the supervision of implementation of team reports to the Board of Directors annually
related ethics policies to the Board of
 The implementation of ethical corporate management
Directors? policies in 2021:
A. Policy announcement:
The Company announce and promote the policies
to the employees. The Administration Department
announced “Developing the corporate culture under
ethical corporate management” policy to prevent
unethical behavior to 17,004 people in 2021 and 1,417
hours.
B. Training and education:
Internal and external promotion, training and education
on ethical management held by the Company: Corporate
Governance Courses held in 2021: "Implementing
sustainable finance and heading towards green finance
2.0" with a total of 41 participants and 123 hours;
"Risk management on Anti-Money Laundering and
Countering the Financing of Terrorism as well as
principles of fair treatment to consumers", total 51
courses.
C. Implemented environmental management system and
finance principles responsibility investment policy in
response to sustainable development.
D. Implementation of the inspection mechanism for
avoiding conflicts of interest in the brokerage business:
To strengthen the management of internal conflicts
of interest by comparing internal staff accounts with
each entrusted trading transaction of all customer
accounts that the internal staff is able to access within
five minutes before and after each entrusted trading
transaction.
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2021 Annual Report

III. Corporate Governance

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Implementation Status Deviations from the
Ethical Corporate
Evaluation Item Management Best
Yes No Abstract Illustration Practices Principles
for TWSE listed
companies and reasons
B. Does the company establish an E. Promoting financial staff service satisfaction survey
exclusively dedicated unit supervised at branch companies: Conducting internal (sales and
managers) and external customer satisfaction surveys
by the Board to be in charge of
for financial staff of branch companies to understand
corporate ethical management, and on
the service support satisfaction of first-line supporting
a regular basis (at least once a year), staff. The satisfaction score was more than 4.95 points
report the status of unethical conduct (out of 5) in 2021.
prevention programs, and the status of F. Promote labor rights seminars and advocate: Explain
the supervision of implementation of and communicate employees' rights and produce audio
related ethics policies to the Board of and video materials for our employees to understand
Directors? their rights at any time, with a view to promoting
harmonious labor relations.
G. The Company has established clear reporting channels,
procedures, and confidentiality measures:
(1) Reporting line: (02) 2748-8173
(2) Reporting email: [email protected]
(3) In written form: Delivery to auditing office chief
auditor.
(4) address: 13F., No. 8, Dongxing Rd., Songshan Dist.,
Taipei City 105
C. Does the Company establish policies ✓ C. President Securities’ board is subject to a high degree None
to prevent conflicts of interest and of self-regulation, whereby any board motion that is
provide appropriate communication suspected of having the potential to create any conflict of
channels for complaints and interest with the board or with any of its representatives or
implement it? proxies must undergo evaluation and may not be included
in the board agenda or voted upon by such party, and also
may not be voted on by any representative or proxy of
such party. Board members should exercise self-regulation
and should not conspire to support one another’s improper
actions.
In order to enable the Directors’ and managers’ conduct
to be in line with the ethical standards and stakeholders
to better understand the Company’s ethical standards, the
Company has established the “Codes of Ethical Conduct
for Directors and Managers of President Securities
Corporation” in August 2018.
D. Has the company established effective ✓ D. In order to ensure healthy and honest operations, the None
systems for both accounting and auditing office is required to submit a report on the
internal control to facilitate ethical adoption of the company’s principles for honest operation
corporate management, has the in its annual audit report, and should ensure that such
internal audit unit developed relevant principles are included in the company’s Work Rules. The
audit plans based on the assessment Committee should also publish on the company website
results of the analysis of the risk of procedures for reporting problems and the corresponding
unethical conduct, and inspect for punishments for such offenses.
compliance with the unethical conduct
prevention programs accordingly, or
has the company appointed CPAs to
perform audits.?
E. Does the company regularly hold ✓ E. The company regularly publishes “honest operation None
internal and external educational standards” and “honest operating procedure and
trainings on ethical management? regulations” , and promotes on the Company Website for
all employees.
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President Securities Corporation

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Implementation Status Deviations from the
Ethical Corporate
Evaluation Item Management Best
Yes No Abstract Illustration Practices Principles
for TWSE listed
companies and reasons
III. Whistle-blowing system
A. Does the company establish a clear ✓ None
The Company has established “Guidelines for Handling
whistleblowing and reward system Reports of Unlawful or Unethical Behavior”.
and set up a convenient channel for
A. We have established a clear channel for receiving
reporting unethical activities and
complaints:
reward system? Can the accused be
reached by an appropriate person for (1) Complaint Hotline: (02) 2748-8173
follow-up?
(2) Complaint Email: [email protected]
(3) Written Complaints: Complaints can be mailed or faxed
to our auditing office.
B. Has the company established standard ✓ B. Clear protocols for handling complaints have been None
operating procedures for investigating established as have confidentiality measures.
any reported misconduct, follow-
up measures to be adopted after
investigations, and relevant
confidentiality mechanisms?
C. Does the company provide proper ✓ C. Clear measures have been put in place to protect those who None
whistleblower protection? register complaints.
IV. Strengthening information
disclosure
Does the company disclose its ethical ✓ In keeping with the company’s ethical corporate management None
corporate management policies and policies, we endeavor to disclose procedures for ethical
results of its implementation on the corporate management both via intranet and via our offical
company's website and MOPS? website (www.pscnet.com.tw).
V. If the company has established the ethical corporate management policies based on the Ethical Corporate Management
Best-Practice Principles for TWSE/TPExListed Companies, please describe any discrepancy between the policies and their
implementation: There have been no differences.
VI. Other important information to facilitate a better understanding of the company's ethical corporate management practices (e.g.,
review and amend its policies): None.
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H. Corporate Governance Guidelines and Regulations

Except for the Corporate Governance Best Practice Principles, the Company has disclosed relevant rules and regulations that shall be established by law on the Company’s website (Investor Section/Corporate Governance) and the Market Observation Post System (MOPS).

I. Other Important Information Regarding Corporate Governance

The Company has disclosed relevant important information regarding corporate governance on the Company’s website (Investor Section/Corporate Governance) and the Market Observation Post System (MOPS).

2021 Annual Report

III. Corporate Governance

J. Internal Control Systems:

1. Internal Control Declaration:

Internal control declaration

Implementation of the internal control system of President Securities Corporation

Date: March 8, 2022.

The Company hereby declares the following based on its self -assessment result on the internal control system of 2021: I. The Company is fully aware that the Board of Directors and the management are responsible for the establishment, implementation, and maintenance of the internal control system and it is established accordingly. The purpose of establishing the internal control system is to reasonably ensure the fulfillment of operational effectiveness and efficiency (including profit, performance, and protection of assets safety), financial report reliability, timeliness, transparency and compliance with applicable rules, laws and regulations. II. The internal control system is designed with inherent limitations. No matter how perfect the internal control system is, it can only provide a reasonable assurance to the fulfillment of the three objectives referred to above. Moreover, the effectiveness of the internal control system could be affected by the changes of environment and circumstances. The Company’s internal control system is designed with a self-monitoring mechanism; therefore, the Company will take corrective actions upon identifying any nonconformity. III. The Company has assessed the design and operating effectiveness of the internal control system in accordance with the criteria provided in the “Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets” (referred to as “the Regulations” hereinafter). The criteria defined in “the Regulations” include five elements depending on the management control process: 1. environment control, 2. risk assessment, 3. control process, 4. information and communication, and 5. supervision. Each of the five elements is then divided into a sub-category. Please refer to “the Regulations” for details. IV. The Company has implemented the criteria of the internal control system referred to above to inspect the design and operating effectiveness of internal control system. V. The Company, based on the inspection approach referred to above, has concluded that the internal control system (including the supervision and management over the subsidiaries) on December 31, 2021 is reasonably effective in achieving the objectives of operational effectiveness and efficiency, financial report reliability, timeliness, transparency and compliance with applicable rules, laws and regulations. Except for the attachment all above mentioned are valid. VI. The Statement is the main contents of the Company’s annual report and prospectus and will be made public. Any illegalities such as misrepresentations or concealments in the published contents mentioned above will be considered a breach of Articles 20, 32, 171, and 174 of the Securities and Exchange Act and Article 115 of Futures and Exchange Act, and entail legal responsibilities. VII. The Statement was resolved in the directors’ meeting with the 0 objection from the 19 attending board directors on March 8, 2022. The contents of the Statement have been accepted without any objection.

President Securities Corporation Chairman: Lin, Kuan-Chen President: Tsai, Sen-Bu Chief Auditor: Huang, Sha-Mei CISO: Lin, Jung-Hui

President Securities Corporation

President Securities Corporation Internal Control System Findings and Remediation Action Plans

Area of Improvement	Improvement Measures	Expected improvement completion time
According to Official Letter No.10903786521 and No. 1090378652 issued by the Finan- cial Examination Bureau on June 18, 2021, Financial Examination Bureau had demanded the company to improve and imposed a pen- alty of NT$ 240,000 for the following defects : 1. The customer’s bank statement was sent to the salesman's email box. 2. In the self-trading of foreign marketable securities activity, the market closing price of the transaction date was not used in transaction price verification process. 3. Whether client has subscribed the shares under someone else's name was not verified during placement of shares for underwriting business (similar to IP check). 4. The counterparties of distributive sale through book building for underwriting business were not professional investment institutions. However, the distributive sales meeting still counted them as within distributive sales scope and decided to include them in priority distributive sales. 5. No fee standard was defined for specific money trust. No actual discount from pre- owner and annualized rate were disclosed in transaction report or statement. 6. Sales broker used Company internal IP to purchase fund for relatives. 7. Money laundering review was not completed within a year for part of high- risk customers.	1. Build up statement verification mechanism. Monthly produce a list of those customers with the same email address and review the list. 2. Correct the system inspection rule for abnormal transaction price verification. 3. Establish an automatic generated list for transactions executed from the same IP, and implement the identical IP review process. 4. The Company has re-defined the criteria of identifying professional investment institution and implemented it. 5. Disclose to transaction counterparty in the statement actual fee charged and annualized fee. 6. Establish an automatic generated list for transactions executed from the same IP, and implement the identical IP review process. 7. Corrected the system calculation of dynamic review start and end date for each customer in order to improve periodic review mechanism.	Has improved Has improved Has improved Has improved Has improved Has improved Has improved

Note: The penalties imposed by the Financial Supervisory Commission, including warnings or above or any fine of NT240,000 or more, shall be listed one by one as well.

2021 Annual Report

III. Corporate Governance

President Securities Corporation Internal Control System Findings and Remediation Action Plans

Area of Improvement	Improvement Measures	Expected improvement completion time
According to Official Letter No. 1100503879 issued by the Taiwan Stock Exchange on December 24, 2021, Taiwan Stock Exchange had demanded the company to improve and imposed a penalty of NT$ 160,000 for the following defects : 1. Multi-factor verification mechanism was not adopted for internet trading system log in. 2. Did not monitor and analyze core system account log in failure record on daily basis. 3. Delayed reporting of information security incidents. According to Official Letter No. 1100372879 and No. 11003728791 issued by the Financial Examination Bureau on Janurary 11, 2022, Financial Examination Bureau had demanded the company to improve and imposed a pen- alty of NT$ 240,000 for the following defects : 1. There are circumstances that headquarter broker accepted instructions to buy or sell marketable securities from persons who are not the client himself without power of attorney from the	1. Engaged a supplier to develop multi- factor verification mechanism to protect transaction security. 2. Set up monitoring and analysis mechanism and maintain the record. 3. Set up mechanism for reporting process flow and timing of report in order to comply with reporting regulation. 1. The Company has started to periodically communicate to employees and request employees to verify client identity. The action is included as one of the items of employees and their line mangers' performance appraisal and punishment upon non-compliance.	2022.3.31 Has improved Has improved Has improved

Note: The penalties imposed by the Financial Supervisory Commission, including warnings or above or any fine of NT240,000 or more, shall be listed one by one as well.

President Securities Corporation

President Securities Corporation Internal Control System Findings and Remediation Action Plans

Area of Improvement	Improvement Measures	Expected improvement completion time
According to Official Letter No. 1110500054 issued by the Taiwan Stock Exchange on Jan- urary 10, 2022, Taiwan Stock Exchange had demanded the company to improve for the following defects : 1. The access account of server room was not immediately deleted upon employee termination. 2. The Company has recorded the number of supplier access to Company server and the action did during the access. However, the access record was not reviewed. 3. The Company has made a list of EOS(end of service) servers. However, a lot of them are still lack of renewal plan. 4. User log in records were not maintained for several internet trading system servers. 5. No security socket layer was activated for internet transmission. Some data was not de-identified in testing system, which did not comply with Personal Data Protection Act. 6. Super user accounts were used by suppliers in several systems, and the accounts were jointly used with application system accounts, which was against the rule of segregation of authorization for program and file access. 7. Lack of evaluation and follow up action for suggestions on penetration test, outsourced system security evaluation and source code testing.	1. Establish real time resignation reporting system. The computer server room access will be canceled immediately based on daily employee change record whenever any employee resigns. 2. The access management personnel periodically review internet access. The review record will be maintained. 3. Prepare renewal plan for servers included in EOS list. 4. Activate system access record function. 5. Security socket layer and whitelist connection was adopted. Data in testing system was de-identified. 6. Supplier authorization was adjusted in order to effectively segregate and manage. 7.Suggestions will be evaluated and followed up.	Has improved Has improved 2022.3.31 Has improved 2022.6.30 2022.6.30 2022.6.30

Note: The penalties imposed by the Financial Supervisory Commission, including warnings or above or any fine of NT240,000 or more, shall be listed one by one as well.

2. If the company has commissioned external auditors to review the company’s internal control system, the external auditor’s report should be disclosed: Not applicable.

2021 Annual Report

III. Corporate Governance

K. Conviction of corporate or employees’ wrongdoings, Company’s punishment on employee for violation of internal control, major faults and improvements during recent fiscal period and to the publish date of the annual report. (If the result of any disciplinary action may have a significant impact on shareholders’ rights and interests or the price of securities, the content of the said action shall be specified.)

1. Punishments imposed on the Company and its internal personnel in accordance with laws

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Major faults Improvements
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Major faults	Improvements

According to Official Letter No. Fu—1100500382 issued by the Taiwan Stock Exchange on Febuary 8, 2021: The Taiwan Stock Exchange went to the Company's Sanchong branch on January 5 and 6, 2021 for inspection. The defciencies in operations that were discovered are as follows: From November 30 to December 6, 2020, the sales Lu ○-Jen used LINE app to recommend marketable securities trading to customers that had not signed the recommendation contract, which violated paragraph 2, Article 18 and paragraph 3, Article 85 of the Company's Operating Rule as well as paragraph 3, Article 2 of Operational Regulations Governing Securities Firms Recommending Trades in Securities to Customers.	1. A minor demerit was given to Lu ○-Jen who violated the rule. A warning was given to her manager Chang ○-Min for not taking management responsibility. 2. The deficiency was reviewed, addressed, and announced to raise the awareness of other personnel. Relevant regulations will be implemented in the future.
According to Official Letter No. Fu—1100500943 issued by the Taiwan Stock Exchange on April 09, 2021: TSE went to the Company's Dunnan Branch on Mar 8, 2021 for inspection. It was discovered that the sales manager Chen ○-An failed to confrm whether the trading counterparty were designated person specifed in Section 3, Paragraph 1, Article 22-2 of the Securities and Exchange Act. The behavior was a violation of Paragraph 2, Article 18 of SEC's Operating Rule and Tai-Cheng-Chiao-Tzu Letter No.0970205887 dated on October 28, 2008.	1. A warning was given to Dunnan Branch Chen ○-An in accordance with Article 50, Chapter 11 of the Company's Work Rule. 2. To ensure the implementation and compliance of internal control operations of the business and prevent employees from violating laws and regulations by accident, the Company reminded employees again to comply with relevant regulations of the business operations when performing the business.
According to Official Letter No.10903786521 issued by the Financial Examination Bureau on June 18, 2021 SFC conducted general business inspection from August 20 to September 9, 2020 and found below deficiencies: Kaohsiung Branch sales Huang ○-Ching, Taoyuan Branch sales Won ○-Feng, and Songjiang Branch sales Chang ○-Li used internal network IP address provided by the Company to purchase mutual funds on behalf of relatives, which were violations of Paragraph 2, Article 18 and Article 17 of Regulations Governing Responsible Persons and Associated Persons of Securities Firms.	1. Warnings were given to those employees that violated the rules in accordance with Article 50, Chapter 11 of the Company's Work Rule as punishment. • Huang ○-Ching of Kaohsiung Branch • Won ○-Feng of Taoyuan Branch • Chang ○-Li of Songjiang Branch 2. To ensure the implementation and compliance of internal control operations of the business and prevent employees from violating laws and regulations by accident, the Company reminded employees again to comply with relevant regulations of the business operations when performing the business.
Cheng-Kui-Fu-Tzu Letter No.1100600333 dated on July 20, 2021. On July 5, 2021, Taipei Exchange conducted project audit on emerging market listed company UBI Pharma and discovered operation deficiencies and action follow-ups, which were violations of Section 3 & 8, Paragraph 1, Article 21 of "Rules Governing the Trading of Emerging Stocks on the TPEx", Rule 3.4.2 of the Company's Emerging Market Internal Operation Rule, Internal control standard of Securities Firm CA-18210 Recommended Dealer Price Negotiation and Trading Activity I Operating Procedure and Control Point (1) Trading and Deal Settlement Activity 4 and 5.	The following personnel were punished according to Article 50, Chapter 11 of the Company's Work Rule: 1. Capital Market Department Vice President Wei ○-Hsu was given a warning. 2. Capital Market Department Senior Project Deputy Manager Hsiao ○-Gi requested a punishment by himself and was given an oral warning.

President Securities Corporation

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Major faults Improvements
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Major faults	Improvements

According to Official Letter No. Fu—1100503879 issued by the Taiwan Stock Exchange on December 24, 2021: On December 2 and 3, 2021, an inspection was conducted on the information security incident reported on November 25, and below deficiencies and follow-up actions were discovered: • Multi-factor verification was not adopted for online order placement, which was a violation of Tai-Cheng-Fu-Tzu Letter No.1100500068 dated on January 8, 2021 and Internal control standard of Securities Firm CC-17010 Network Security Management (3) 3 "If the Company provides online order placement, the online order placement log in should be made through multi-factor verification (mechanisms such as order certificate, bundled device, OTP, biometric) in order to ensure the person who logs in is the customer himself". • The Company failed to daily monitor and analyze core system account log in failure record, which was a violation of Tai-Cheng-Fu-Tzu Letter No.1100500068 dated on January 8, 2021 and Internal control standard of Securities Firm CC-17010 Network Security Management (3) 2 "The Company shall monitor and analyze core system log in failure record and non- customer log in attempt record on daily basis, and keep related monitoring and analysis record". • Delayed reporting of information security incidents, which was a violation of Internal control standard of Securities Firm CC-20000 Continual Operation Management (9) "The Company shall set up information security message reporting mechanism". • The Company failed to carry out the review of internal control system periodically, which was a violation of Paragraph 2, Article 18 of the Company's Operating Rule and Standard Internal Control System for Securities Companies General Principles 4 "The Company shall consider the overall operating activities of the business, design and carry out internal control system and review periodically in order to face internal and external environment change of the Company, so as to ensure the design and execution of internal control system is continuously effective."	A warning was given to the Company's Chief Information Security Officer and Senior Director Lin ○-Hui according to Article 50, Chapter 11 of the Company's Work Rule.
According to Official Letter No. Fu—1100503921 issued by the Taiwan Stock Exchange on December 29, 2021: TSE went to the Company's Sanduo Branch to conduct inspection on November 22 and 23, 2021 and discovered below operating deficiencies: Manager Tsai ○-Jen accepted the discretionary trading from customers including the type, quantity, price, buy or sell of marketable securities, which was a violation of Paragraph 2, Article 135 and Article 144 of SEC Operating Rule and Section 3, Paragraph 2, Article 18 of Regulations Governing Responsible Persons and Associated Persons of Securities Firms, Paragraph 2, Article 18 and Paragraph 1, Article 85 of SEC Operating Rule.	1. The personnel, Tsai ○-Jen, who violated the rule, was given two minor demerits and one warning. 2. The deficiency was reviewed, addressed, and announced to raise the awareness of other personnel. Relevant regulations will be implemented in the future.

2021 Annual Report

III. Corporate Governance

L. Major Resolutions of Shareholders Meeting and Board of Directors Meeting

1. Major resolutions of 2021 General Shareholders Meeting: Executed according to the resolution of the General Shareholders Meeting.

2021 Annual General Shareholders Meeting
(1) Matters to be ratified

Proposal 1 Proposed for approval of 2020 Business Report and Consolidated and Individual Financial Statements	Proposal 1 Proposed for approval of 2020 Business Report and Consolidated and Individual Financial Statements
Explanation	1. 2020 Consolidated and Individual Financial Statements of the Company was audited and certified by accountant Lin, Se-Kai, Lo, Chiao-Sen from PwC. 2. Business Report as well as Consolidated and Individual Financial Statements were approved by the 18th Meeting of the 11th Board of Directors on March 23, 2021, and reviewed by the Audit Committee. 3. Business Report as well as Consolidated and Individual Financial Statements please refer to the appendix.
Resolution	The Company's shareholders present have total votes of 949,940,008, of which approval votes 904,506,800 (including electronic votes of 719,156,636), disapproval votes 147,117 (including electronic votes of 147,117), abstention votes/no votes 45,286,091 (including electronic votes of 45,286,091), and invalid votes 0; the approval votes account for 95.21%, over half of the total votes of the shareholders present. The proposal made by the Board of Directors was approved as it was.
Proposal 2 Proposed for approval of 2020 profit distribution
Explanation	1. The Company's 2020 earnings distribution was conducted in accordance with laws and the Company's Articles of Incorporation. (see the appendix) 2. For the calculation of the 2020 profit to be distributed, an decreasing adjustment of NT$17,197,851 in the remeasurement of defined benefit plan and add disposal of equity instruments at fair value through other comprehensive income NT177,031,100.; in addition, legal reserve (10%) and special reserve (20%) shall be listed by law. In accordance with Jin-Guan-Zheng-Tou No. 1080321644, training expense NT7,620,334 for FinTech transformation in 2020 was used to reverse special reserve. Distributable earnings in 2020 amounted to NT$2,681,240,405, and the cash dividends to be paid was NT$2,099,756,744; a cash dividend of NT$1.5 would be paid per share. Stock dividends to be paid was NT$559,935,140; a stock dividend of NT$ 0.4 would be paid per share. Every thousand shares are allocated with a stock dividend of 40 shares. After approved at the shareholders' meeting, it is planned to invite the shareholders' meeting to authorize the Board of Directors to set the base date for ex-rights, ex-dividends and capital increasing. 3. In the future, if there is a change in the number of outstanding shares, it is planned to authorize the Board of Directors to adjust the allocation ratio according to the total number approved by the the shareholders' meeting via resolution and the number of the Company's ordinary shares actually in circulation on the record date for ex-rights, ex-dividends and capital increasing; if the dividend allocated to shareholders is less than NT$1, the amount will be transferred to the Company's Employee Welfare Committee.
Resolution	The Company's shareholders present have total votes of 949,940,008, of which approval votes 905,744,837 (including electronic votes of 720,394,673), disapproval votes 356,017 (including electronic votes of 356,017), abstention votes/no votes 43,839,154 (including electronic votes of 43,839,154), and invalid votes 0; the approval votes account for 95.34%, over half of the total votes of the shareholders present. The proposal made by the Board of Directors was approved as it was.
Execution	On August 3, 2021, the Company announced that the ex-dividend date was September 1, 2021, and the payout of cash dividends and stock dividends was completed on September 30, 2021.

(2) Matters to be discussed

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Proposal 1 Amendments to the Articles of Incorporation are proposed for discussion.
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Proposal 1
Amendments to the Articles of Incorporation are proposed for discussion.

Explanation

1. As the Company applied to start the discretionary investment business through trust for the securities
investment advisory business, the Company renewed the securities business operation license from SFC on
January 21, 2021, and added investment advisory business in the operating scope of business. The Company
amended Article 2 of the Articles of Incorporation for the newly added securities investment advisory
business.
2. Please see appendix for related information.
3. Supplementary explanation: Shareholders' meeting was postponed to July 20, 2021. Therefore 29th amendment
of Article 26 was corrected to July 20, 2021.

President Securities Corporation

Resolution	The Company’s shareholders present have total votes of 949,940,008, of which approval votes 904,138,709 (including electronic votes of 718,788,545), disapproval votes 169,032 (including electronic votes of 169,032), abstention votes/no votes 45,632,267 (including electronic votes of 45,632,267, and invalid votes 0; the approval votes account for 95.17%, over half of the total votes of the shareholders present. The proposal made by the Board of Directors was approved as it was.
Proposal 2 Amendments to Rules Governing the Proceedings of Shareholder Meetings are submitted for discussion.
Explanation	1. Handle in accordance with Tai-Cheng-Chi-Li-Tse-Letter No.1090009468 dated on June 3, 2020 and Tai- Cheng-Chi-Li-Tse-Letter No.1100001446 issued by TWSE. 2. Please see handbook appendix for related information. 3. Supplementary explanation: Shareholders' meeting was postponed to July 20, 2021. Therefore 7th amendment of Article 19 was corrected to July 20, 2021.
Resolution	The Company’s shareholders present have total votes of 949,940,008, of which approval votes 904,147,676 (including electronic votes of 718,797,512), disapproval votes 175,051 (including electronic votes of 175,051), abstention votes/no votes 45,617,281 (including electronic votes of 45,617,281, and invalid votes 0; the approval votes account for 95.17%, over half of the total votes of the shareholders present. The proposal made by the Board of Directors was approved as it was.
Proposal 3 Dividends for Shareholders and Issuing New Shares are proposed for discussion.
Explanation	1. In order to replenish its working capital, the Company proposed appropriating NT$559,935,140 from the 2020 dividends for shareholders and issuing 55,993,514 new shares by means of the capitalization of earnings. Every thousand shares are allocated with a stock dividend of 40 shares at a par value of NT$10 per share. 2. Shareholders may register the number of fractional shares within five days of the capital increase record date at the Company’s Shareholder Services Department. If shareholders fail to register these fractional shares within the specified period, the shares shall be converted into cash based on their face value and rounded to the nearest NTD (decimals are rounded off). The fractional shares shall be incorporated into the Company’s Employee Welfare Committee free of charge. 3. In the event that the total number of the Company’s outstanding shares are affected by the Company’s repurchase of its shares or transfer or cancellation of treasury shares, which causes the shareholder dividend ratio to be changed, the Company proposes to authorize the Board of Directors to adjust the dividend rate based on the total amount to be distributed as resolved in the shareholders’ meeting and the actual quantity of the Company’s outstanding ordinary shares on the record date of ex-rights and capital increase. 4. After the capital increase proposal has been passed in a resolution of the shareholders’ meeting and reported to the competent authority for approval, the shareholders’ meeting the Company plans to request that the shareholders authorize the Board of Directors to set the date of ex-rights and capital increase as well as to distribute stock dividends in accordance with the shareholding ratio of the shareholder register on the record date. In the event that the proposal shall be revised due to changes in regulations or as instructed by the competent authority, at the shareholders’ meeting the Company proposes to request the shareholders authorize the Board of Directors to handle it at its sole discretion. The rights and obligations associated with the new shares issued at this time are identical to those associated with the existing shares.
Resolution	The Company’s shareholders present have total votes of 949,940,008, of which approval votes 904,138,403 (including electronic votes of 718,788,239), disapproval votes 194,569 (including electronic votes of 194,569), abstention votes/no votes 45,607,036 (including electronic votes of 45,607,036), and invalid votes 0; the approval votes account for 95.17%, over half of the total votes of the shareholders present. The proposal made by the Board of Directors was approved as it was.
Proposal 4 The Endorsements and Guarantees Implementation Rules are revised in response to the letter from the competent authority and they are submitted for discussion.
Explanation	1. The Company's "Endorsements and Guarantees Implementation Rules" are revised in accordance with the Jin- Guan-Zheng-Quan-Tse-No.10903641202 issued on Sep 10, 2020 by the Financial Supervisory Commission. 2. Please see handbook appendix for related information.
Resolution	The Company’s shareholders present have total votes of 949,940,008, of which approval votes 904,163,978 (including electronic votes of 718,813,814), disapproval votes 157,874 (including electronic votes of 157,874), abstention votes/no votes 45,618,156 (including electronic votes of 45,618,156), and invalid votes 0; the approval votes account for 95.18%, over half of the total votes of the shareholders present. The proposal made by the Board of Directors was approved as it was.

2021 Annual Report

(3) Election to be discussed

III. Corporate Governance

Proposal 1	An election of the 12th Board of Directors.	An election of the 12th Board of Directors.	An election of the 12th Board of Directors.	An election of the 12th Board of Directors.	An election of the 12th Board of Directors.	An election of the 12th Board of Directors.	An election of the 12th Board of Directors.	An election of the 12th Board of Directors.
Explanation	1. The 11th term of directors and supervisors of the Company will expire on June 17, 2021 and will be fully re-elected at this annual shareholders' meeting. 2. According to Article 13 of the Articles of Incorporation, the Company sets up 19 Directors, among which 4 are Independent Directors and 15 are non-independent directors, with term of three years(from June 17, 2021 upon Shareholders' meeting ends until June 16, 2024). Current directors are eligible for re-election. The Company adopts candidate nomination system in election of directors. Shareholders shall elect the directors from among the nominees listed in the roster of director candidates. 3. Relevant election matters shall be handled in accordance with the Company's Rule for Election of Directors. 4. Please re-elect. 5. Basic information of nominees listed in the roaster
	Title	Name	Education	Experience	Current Position	The name of government or juridical person represented(please fll in complete name instead of abbreviation).	Whether served as an Independent Director for Three Consecutive Terms?	Holding
	Director	Lin, Kuan- Chen	• National Taiwan Sport University	• Chairman of President Securities Corporation • Director of Taiwan Futures Exchange • Director of President Futures Corp. • Director of President Securities (HK) Ltd./President Securities (BVI) Ltd./ President Securities (Nominee) Ltd./ President Wealth Management (HK) Ltd. • Director of Jin Yuan President Securities Co., Ltd. • Chairman of Richness Cereal Trading Co., Ltd. • Director and General Manager of Fonmau Cereal Industrial Co., Ltd. • Director of Q-WARE Systems & Services Corp. • Director/ Vice Chairman/ General Manager of President Securities Corporation	• Chairman of President Securities Corporation • Director of Taiwan Futures Exchange • Director of President Futures Corp. • Director of President Securities (HK) Ltd./President Securities (BVI) Ltd./ President Securities (Nominee) Ltd./ President Wealth Management (HK) Ltd. • Director of Jin Yuan President Securities Co., Ltd. • Chairman of Richness Cereal Trading Co., Ltd. • Director and General Manager of Fonmau Cereal Industrial Co., Ltd. • Director of Q-WARE Systems & Services Corp.	Kai Nan Investment Co., Ltd.	NA	40,628,089
	Director	Liu, Tsung-Yi	• Ph.D. in Finance, National Chung Hsing Uiversity, R.O.C. • MBA of National Taiwan University, R.O.C.	• Vice President of Uni-President Enterprises Corp, Business Integration Division • Director of Presco Netmarketing, Inc. • Director of President International Development Corp. • Director of President Securities Corporation • Director of Kuang Chuan Dairy Co., Ltd., Kuang Chuan Foods Ltd.,Tait Marketing & Distribution Co., Ltd.,Champ Green Capital,Yantai North Andre Juice Co Ltd., United Advisor Venture Management Ltd., SMS Investment Management Co.,Ltd., SMS Capital Co.,Ltd., SMS Capital Management Ltd., Shanghai Shunfeng Restaurant Group Co., Ltd., Huasui Tomato Investment Company, Woongjin Foods Co., Ltd., Daeyoung Foods Co., Ltd., Uni-President (Korea) Co.,Ltd., Changhua County Chang Chun-Ya Private Social Welfare Charity Foundation • President of Champ Green (Shanghai) Consulting Co., Ltd., and United Advisor Venture Management Ltd.	• Vice President of Uni-President Enterprises Corp, Business Integration Division • Director of Presco Netmarketing, Inc. • Director of President International Development Corp. • Director of President Securities Corporation • Director of Kuang Chuan Dairy Co., Ltd., Kuang Chuan Foods Ltd.,,Tait Marketing & Distribution Co., Ltd.,Champ Green Capital,Yantai North Andre Juice Co Ltd., United Advisor Venture Management Ltd., SMS Investment Management Co.,Ltd., SMS Capital Co.,Ltd., SMS Capital Management Ltd., Shanghai Shunfeng Restaurant Group Co., Ltd., Huasui Tomato Investment Company, Woongjin Foods Co., Ltd., Daeyoung Foods Co., Ltd., Uni-President (Korea) Co.,Ltd., Changhua County Chang Chun-Ya Private Social Welfare Charity Foundation • President of Champ Green (Shanghai) Consulting Co., Ltd., and United Advisor Venture Management Ltd.	Kai Nan Investment Co., Ltd.	NA	40,628,089

President Securities Corporation

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The name of Whether
government or served as
juridical person an
Title Name Education Experience CurrentPosition (please fill in represented Independent Director Holding
complete name for Three
instead of Consecutive
abbreviation). Terms?
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Explanation	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding
	Title	Name	Education	Experience	Current Position	The name of government or juridical person represented (please fll in complete name instead of abbreviation).	Whether served as an Independent Director for Three Consecutive Terms?	Holding

Explanation	Director	Chen, Kuo-Hui	• University of Strathclyde, MBA	• CFO of Uni-President Enterprises Corp. • Chairman of Kai Yu (BVI) Investment Co., Ltd. • Chairman of Tone Ren Enterprise Co., Ltd. • Director of President Securities Corp. • Director of President International Development Corp. • Director of Uni-President China Holdings Ltd./ President Enterprises (China) Investment Co., Ltd./ Uni-President Hong Kong Holdings Limited/ Uni- President (Vietnam) Co., Ltd./ Uni-President (Singapore) Pte. Ltd. • Supervisor of Champ Green (Shanghai) Consulting Co., Ltd./ United Advisor Venture Management Co., Ltd.	• CFO of Uni-President Enterprises Corp. • Chairman of Kai Yu (BVI) Investment Co., Ltd. • Chairman of Tone Ren Enterprise Co., Ltd. • Director of President Securities Corp. • Director of President International Development Corp. • Director of Uni-President China Holdings Ltd./ President Enterprises (China) Investment Co., Ltd./ Uni-President Hong Kong Holdings Limited/ Uni- President (Vietnam) Co., Ltd./ Uni-President (Singapore) Pte. Ltd. • Supervisor of Champ Green (Shanghai) Consulting Co., Ltd./ United Advisor Venture Management Co., Ltd.	Kai Nan Investment Co., Ltd.	NA	40,628,089
	Director	Hsieh Hong, Hui-Tzu	• M.S., Dept. of Business Administration, National Cheng Kung University	• Vice President/ Chief Corporate Governance Officer (Secretariat the Board of Directors) President Chain Store Corp. • Director of President Securities Corp. • Chief Audit Officer of President Chain Store Corp. • Vice President of ScinoPharm Taiwan Ltd. (Administration Center ) • Vice President of President International Development Corp. (F&A Division)	• Vice President/ Chief Corporate Governance Officer (Secretariat the Board of Directors) President Chain Store Corp. • Director of President Securities Corp.	Kai Nan Investment Co., Ltd.	NA	40,628,089
	Director	Lu, Li-An	• Master of Business Administration/ Institute of Financial Management, National Sun Yat-sen University	• Vice President of Administration and Spokesperson of ScinoPharm Taiwan Ltd. • Director of President Transnet Corp. • Director of President Securities Corp. • Supervisor of Tong Kuan Enterprise Co., Ltd. • Division Head of Treasury Division, Uni-President Enterprises Corp. • Vice president of IBT Securities Co., Ltd. • Assistant Manager of Taiwan International Securities Co.,Ltd.	• Vice President of Administration and Spokesperson of ScinoPharm Taiwan Ltd. • Director of President Transnet Corp. • Director of President Securities Corp. • Supervisor of Tong Kuan Enterprise Co., Ltd.	Kai Nan Investment Co., Ltd.	NA	40,628,089
	Director	Chen, Ching-Yi	• Fu Jen Catholic University bachelor degree of Economics	• Treasury Division Manager of Uni-President Enterprises Corp. • Director of PK Venture Capital Corp. • Director of President Securities Corp. • Assistant Manager of Apacer Technology Inc., Finance Department	• Treasury Division Manager of Uni-President Enterprises Corp. • Director of PK Venture Capital Corp. • Director of President Securities Corp.	Kai Nan Investment Co., Ltd.	NA	40,628,089
	Director	Chen, Yi-Ling	• University of Dallas Master of Business Administration	• Financial Planning Division Manager of Uni-President Enterprises Corp. • Director of President Securities Corp.	• Financial Planning Division Manager of Uni-President Enterprises Corp. • Director of President Securities Corp	Kai Nan Investment Co., Ltd.	NA	40,628,089

2021 Annual Report

III. Corporate Governance

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Explanation	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding
	Title	Name	Education	Experience	Current Position	The name of government or juridical person represented (please fll in complete name instead of abbreviation).	Whether served as an Independent Director for Three Consecutive Terms?	Holding

Explanation	Director	Teng, Wen-Hwi	• Ph.D., University of San Francisco • Master, Harvard University • MBA, George Washington University	• Chairman of Canking Investment Co., Ltd. • Director of President Securities Corp. • Director of Cayenne Entertainment Technology Co., Ltd.	• Chairman of Canking Investment Co., Ltd. • Director of President Securities Corp.	Canking Investment Co., Ltd.	NA	17,257,228
	Director	Lee, Chi-Ming	• Department of International Business Soochow University	• Director of Hui Tung Investment Co., Ltd. • Vice Chairman of Hui Tung Enterprise Corp. • Chairman of Chieforce Corp. • Director of President Securities Corp. • Director of HHB Geriatric Healthcare Corp./ Japan Asia Specialities Co. Ltd./ Zhao Tung Corp./ Chao Tung Corp./ Union Chinese Corp./ Chang Kun ousing Corp./ Point Deco Co., Ltd./ Huai Ren International Co., Ltd.	• Director of Hui Tung Investment Co., Ltd. • Vice Chairman of Hui Tung Enterprise Corp. • Chairman of Chieforce Corp. • Director of President Securities Corp. • Director of HHB Geriatric Healthcare Corp./ Japan Asia Specialities Co. Ltd./ Zhao Tung Corp./ Chao Tung Corp./ Union Chinese Corp./ Chang Kun Housing Corp./ Point Deco Co., Ltd./ Huai Ren International Co., Ltd.	Hui Tung Investment Co., Ltd.	NA	10,403,534
	Director	Chang, Ming-Chen	• BBA in Business Amini- stration, Soochow University	• Director and Accounting Manager of Leg Horn Investment Co., Ltd. • Director of President Securities Corp.	• Director and Accounting Manager of Leg Horn Investment Co., Ltd. • Director of President Securities Corp.	Leg Horn Investment Co., Ltd.	NA	12,656,178
	Director	Tu, Li-Yang	• National Tainan Girl’s Senior High School	• Chairman of Ta Le Investment Holding Co., Ltd. • Chairman of Litz’s Enterprise Ltd. • Director of President Securities Corp. • Director of Strong Team International Inc. • Director of Kao's Express Warehouse & Stevedoring Co., Ltd.	• Chairman of Ta Le Investment Holding Co., Ltd. • Chairman of Litz’s Enterprise Ltd. • Director of President Securities Corp. • Director of Strong Team International Inc. • Director of Kao's Express Warehouse & Stevedoring Co., Ltd.	Ta Le Investment Holding Co., Ltd.	NA	7,316,067
	Director	Lee, Shu-Fen	•Ming Chuan University	• Consultant of China F.R.P. Corporation • Employee of Kao Ying-Shih Chinese Culture Collection Educational Foundation of Kaohsiung • Director of President Securities Corp. • Auditing Manager/ Accounting Deputy Manager/ Deputy Section Manager of Business section of Eternal Materials Co., Ltd.	• Consultant of China F.R.P. Corporation • Employee of Kao Ying-Shih Chinese Culture Collection Educational Foundation of Kaohsiung • Director of President Securities Corp.	China F.R.P. Corporation.	NA	10,200,000

President Securities Corporation

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Explanation	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding
	Title	Name	Education	Experience	Current Position	The name of government or juridical person represented (please fll in complete name instead of abbreviation).	Whether served as an Independent Director for Three Consecutive Terms?	Holding

Explanation	Director	Duh, Bor-Tsang	• Master of Business Amini- stration, University of Dallas	• Chairman of Shun Fu Tai Industrial Co., Ltd. • Chairman of Yao-Jun Technology Inc. • Director of Midori Inc • Director of President Securities Corp. • Director of My-Semi Inc. • Director of NANTEX Industry Co., Ltd. • Supervisor of Lillian Investment Co.,Ltd.	• Chairman of Shun Fu Tai Industrial Co., Ltd. • Chairman of Yao-Jun Technology Inc. • Director of Midori Inc • Director of President Securities Corp. • Director of My-Semi Inc. • Director of NANTEX Industry Co., Ltd. • Supervisor of Lillian Investment Co.,Ltd.	NA	NA	4,273,744
	Director	Lee, Tzong- Shiun	• The University of California Irvine Paul Merage School of Business, MBA	• Chairman of Fu Huey Inc. • Director of Teh Long Warehousing & Stevedoring Co., Ltd. • Supervisor of Grown Field Co., Ltd.	• Chairman of Fu Huey Inc. • Director of Teh Long Warehousing & Stevedoring Co., Ltd. • Supervisor of Grown Field Co., Ltd.	NA	NA	836,911
	Director	Juang, Jing-Yau	• Golden Gate University, MBA in Finance	• Assistant Vice President of Tainan Spinning Co., Ltd. • President of T.S. Retail and Distribution Co. • Chairman of United Investment Pte. Ltd. • Chairman of United Investment Pte. Ltd.(Taipei) • Director of President Securities Corp./ Nan Fan Housing Co., Ltd./ Q-Ware Systems & Services Corp./ NANTEX Industry Co., Ltd./ T.S. Retail and Distribution Co./ eten Technologies Inc./ Universal venture Capital Investment Corp. • Director of Nan Fan Development Co.,Ltd.	• Assistant Vice President of Tainan Spinning Co., Ltd. • President of T.S. Retail and Distribution Co. • Chairman of United Investment Pte. Ltd. • Chairman of United Investment Pte. Ltd.(Taipei) • Director of President Securities Corp./ Nan Fan Housing Co., Ltd./ Q-Ware Systems & Services Corp./ NANTEX Industry Co., Ltd./ T.S. Retail and Distribution Co./ eten Technologies Inc./ Universal venture Capital Investment Corp.	NA	NA	3,060
	Independ- ent Director	Liang, Yann- Ping	• MBA, George Washing- ton University	• Department of Finance, Shih Hsin University Associate Professor/ Assistant Professor • Independent Director of President Securities Corp. • Member of Self-disciplinary Committee of Unique Satellite Television (USTV)	• Department of Finance, Shih Hsin University Associate Professor/ Assistant Professor • Independent Director of President Securities Corp. • Member of Self-disciplinary Committee of Unique Satellite Television (USTV)	NA	None	0

2021 Annual Report

III. Corporate Governance

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Explanation	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding	Title Name Education Experience Current Position The name of government or juridical person represented (please fll in complete name instead of abbreviation). Whether served as an Independent Director for Three Consecutive Terms? Holding
	Title	Name	Education	Experience	Current Position	The name of government or juridical person represented (please fll in complete name instead of abbreviation).	Whether served as an Independent Director for Three Consecutive Terms?	Holding

Explanation	Independ- ent Director	Pai, Chun-Nan	• Ph.D. in Law, Chinese Culture University	• Vice Chairman of China Petrochemical Development Corporation • Chairman of The First Leasing Corp. • Chairman of Bo-Meng Investment Co., Ltd. Independent Director of Megaforce Company Ltd. • Director of BES Engineering Corp. • Director of Core Pacific City Co., Ltd. • Director of Wei Lih Food Industrial Co., Ltd. • Director of Taivex Therapeutics Corporation • Independent Director of President Securities Corp.	• Vice Chairman of China Petrochemical Development Corporation • Chairman of The First Leasing Corp. • Chairman of Bo-Meng Investment Co., Ltd • Independent Director of Megaforce Company Ltd. • Director of BES Engineering Corp. • Director of Wei Lih Food Industrial Co., Ltd. • Director of Taivex Therapeutics Corporation • Independent Director of President Securities Corp.	NA	None	0
	Independ- ent Director	Song, Yung-Fong	• The University of Iowa, MBA	• Independent Director of President Securities Corp. • Venture Partner of Leadsun Investment & Asset Management Ltd. • Advisor of Ikhlas Capital, Singapore • Executive Vice President and CIO of Chunghwa Telecom Co., Ltd. • President of Chunghwa Investment Company • Chairman of CIMB Advisory, Taiwan • Managing Director of CIMB Securities,Taiwan	• Independent Director of President Securities Corp. • Venture Partner of Leadsun Investment & Asset Management Ltd. • Supervisor: Zhi Nong Green Power Investment Co., Ltd.	NA	None	0
	Independ- ent Director	Horng, Yuan- Chuan	• Department of Economics, Soochow University	• Independent Director of Himax Technologies, Inc. • Independent Director of President Securities Corp. • Vice President of Finance Division of China Steel Corporation • Chairman of Gains Investment Corp.	• Independent Director of Himax Technologies, Inc. • Independent Director of President Securities Corp.	NA	None	0
	Additional Note: As the date of the shareholders' meeting was postponed to 20 July 2021, the term of office of the directors is three years (from the elections of the meeting of shareholders on July 20, 2021, to July 19, 2024).

President Securities Corporation

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SHAREHOLD-ER’S AC-
ELECTION CATEGORIES NAME VOTES RECEIVED RESULTS
COUNT NUM-BER OR ID
DIRECTOR 42740 KAI NAN INVESTMENT CO.,LTD 1,043,414,276 Elected
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Resolution	ELECTION CATEGORIES SHAREHOLD-ER’S AC- COUNT NUM-BER OR ID NAME VOTES RECEIVED RESULTS DIRECTOR 42740 KAI NAN INVESTMENT CO.,LTD 1,043,414,276 Elected	ELECTION CATEGORIES SHAREHOLD-ER’S AC- COUNT NUM-BER OR ID NAME VOTES RECEIVED RESULTS DIRECTOR 42740 KAI NAN INVESTMENT CO.,LTD 1,043,414,276 Elected	ELECTION CATEGORIES SHAREHOLD-ER’S AC- COUNT NUM-BER OR ID NAME VOTES RECEIVED RESULTS DIRECTOR 42740 KAI NAN INVESTMENT CO.,LTD 1,043,414,276 Elected	ELECTION CATEGORIES SHAREHOLD-ER’S AC- COUNT NUM-BER OR ID NAME VOTES RECEIVED RESULTS DIRECTOR 42740 KAI NAN INVESTMENT CO.,LTD 1,043,414,276 Elected	ELECTION CATEGORIES SHAREHOLD-ER’S AC- COUNT NUM-BER OR ID NAME VOTES RECEIVED RESULTS DIRECTOR 42740 KAI NAN INVESTMENT CO.,LTD 1,043,414,276 Elected
	ELECTION CATEGORIES	SHAREHOLD-ER’S AC- COUNT NUM-BER OR ID	NAME	VOTES RECEIVED	RESULTS
	DIRECTOR	42740	KAI NAN INVESTMENT CO.,LTD	1,043,414,276	Elected
Resolution			LIN,KUAN-CHEN
	DIRECTOR	42740	KAI NAN INVESTMENT CO.,LTD LIU,TSUNG-YI	910,767,223	Elected
	DIRECTOR	42740	KAI NAN INVESTMENT CO.,LTD CHEN,KUO-HUI	910,757,220	Elected
	DIRECTOR	42740	KAI NAN INVESTMENT CO.,LTD HSIEHHUNG,HUI-TZU	910,301,953	Elected
	DIRECTOR	42740	KAI NAN INVESTMENT CO.,LTD LU,LI-AN	910,224,864	Elected
	DIRECTOR	42740	KAI NAN INVESTMENT CO.,LTD CHEN,JIN-YI	894,714,864	Elected
	DIRECTOR	42740	KAI NAN INVESTMENT CO.,LTD CHEN,YI-LING	894,043,916	Elected
	DIRECTOR	30	CANKING INVESTMENT CORP. TENE,WEN-HWI	893,091,973	Elected
	DIRECTOR	3126	HUI TUNG INVESTMENT CO.,LTD. LEE,CHI-MING	890,341,062	Elected
	DIRECTOR	83	LEG HORN INVESTMENT CO.,LTD. CHANG,MING-CHEN	890,011,539	Elected
	DIRECTOR	9142	TA LEH INVESTMENT HOLDING CO.,LTD TU,LI-YANG	889,682,008	Elected
	DIRECTOR	93	CHINA F.R.P. CORPORATION LEE,SHU-FEN	889,352,483	Elected
	DIRECTOR	72	DUH,BOR-TSANG	889,342,478	Elected
	DIRECTOR	2956	LEE,TZONG- SHIUN	885,813,754	Elected
	DIRECTOR	123653	JUANG,JING-YAU	885,803,754	Elected
	INDEPENDENT DIRECTOR	M22****540	LIANG,YANN-PING	866,708,488	Elected
	INDEPENDENT DIRECTOR	F10****627	PAI,CHUN-NAN	865,812,495	Elected
	INDEPENDENT DIRECTOR	A12****504	SONG,YUNG-FONG	865,726,163	Elected
	INDEPENDENT DIRECTOR	D10****068	HORNG,YUAN-CHUAN	865,632,696	Elected

(4) Other Matters

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Proposal 1 Proposal to release the newly elected directors from non-competition restrictions.
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Proposal 1 Proposal to release the newly elected directors from non-competition restrictions.	Proposal 1 Proposal to release the newly elected directors from non-competition restrictions.

Explanation	The proposal is to waive the non-compete clause for the 12th Director candidate Kuan-Chen Lin to act as the Di- rector of Jin Yuan President Securities Corporation Ltd in accordance with Article 209 of the Company Act.
Resolution	Total voting rights of the attendance are 949,940,008 votes. After deducting abstention from voting of 4,700,000 votes, the effective voting rights of this proposal are 945,240,008 votes. Approval votes 899,093,946 (including electronic votes of 718,433,782), disapproval votes 318,137 (including electronic votes of 318,137), abstention votes/no votes 45,827,925 (including electronic votes of 45,827,925), and invalid votes 0; the approval votes account for 95.12%, over half of the total votes of the shareholders present. The proposal made by the Board of Directors was approved as it was.

Note: Please refer to the Market Observatory Post System—Annual Reports and Shareholders Meetings (including depositary receipt information) for relevant appendices of the meetin.

2021 Annual Report

III. Corporate Governance

2. Major Resolutions during the Board of Directors Meetings in 2021 and to the Publish Date of the Annual Report: Executed according to the resolution of the Board of Directors Meeting.

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Meeting Item Resolution
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Meeting	Item	Resolution

2021.03.23 The 18th Board meeting of the 11th Board of Directors	1. Review of 2020 Business Report and Consolidated and Individual Financial Reports 2. Proposal regarding 2020 Employees and Directors Bonus Distribution Ratio. 3. Proposal regarding 2020 Employees and Directors Bonus Allocation. 4. Profit distribution of year 2020 5. Convert retained earnings to capital 6. Applied for the issuance of exchange-trade notes (ETNs) linked to the ICE FactSet Asia Semiconductor Index. 7. Submitted the Statement of the 2020 Internal Control System 8. Amended the operating procedures for the wealth management business 9. Revised the Internal Control System of Information System Department 10. Submitted the Overall Information Security Implementation Statement 11. Disclosed qualitative information ablout risk management 12. Applied for an increase in the limit of non-restricted purpose loans for Hsinchu Branch customers 13. Applied for an increase in the securities lending lines for JP Morgan Securities 14. Changes in managers 15. Changes in department supervisors 16. The proposal regarding the Company’s representatives (managers) serving as Directors of investee enterprises 17. Status of the implementation of the principle of fair hospitality in 2020 18. Amendments to the policies and strategies of the principle of fair hospitality 19. Amended the Articles of Incorporation 20. Proposal for amendments to the rules governing shareholders meetings 21. Amended the Corporate Governance Best Practice Principles Report on the Company’s anti-money laundering and anti-terrorist-financing risk assessment in 2020 22. Company’s 2020 money laundering and terrorist financing risk assessment report 23. Company’s 2020 legal compliance risk evaluation report 24. Internal Control Certification on AML/CFT and Insider Trading 25. Amended the Regulations Governing the Loaning of Funds and Creation of Endorsements/Guarantees 26. Accountant independence and competency evaluation 27. Applied for credit line for short-term loans from financial institutions 28. Applied for credit line for short-term loans in foreign currencies from financial institutions for OSU 29. Applied for credit line for short-term loans from financial institutions for Hongkong Subsidiaries 30. Proposal regarding holding the General Shareholders Meeting of 2021 31. Proposal regarding the election of the 12th Board of Directors 32. Nominations for the 12th Board of Directors 33. List of candidates nominated by the Board of Directors	All Directors present voted in favor of the resolution without any objection.

President Securities Corporation

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Meeting Item Resolution
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Meeting	Item	Resolution

2021.05.06 The 19th Board meeting of the 11th Board of Directors	1. The proposal has been withdrawn as approved by all the directors present 2. Revised the Internal Control System of Information System Department 3. Apply to offer consignment trading of foreign securities to high-asset customers, including international securities business. 4. Apply to offer wealth-management service to high-asset customers. 5. Apply to offer proprietary trading of overseas bonds at the business premises to high-asset customers, including international securities business. 6. Apply the upper limit of total position of transactions between NTD and foreign currencies to be USD 3 million. 7. Increase the number of upstream securities firms for commissioned transactions in foreign securities business. 8. Amended the audition policies of products 9. Apply to incrementally issue President Hang Seng TECH Index ETN. 10. Apply to increase the annual department risk value upper limit for proprietary trading department. 11. Status of the implementation of the principle of fair hospitality from January to March 2021. 12. Amended the Directors Performance Evaluation Measures 13. Proposal regarding 2020 Manager and Employees Bonus Allocation. 14. Proposal for consultant re-appointment and remuneration. 15. The proposal regarding the promotion of department supervisors. 16. Waive the non-compete clause of the Company's Directors. 17. Reviced the minute of 2021 shareholder meeting. 18. Proposal to increase the capital of Jin Yuan President Securities Corporation Ltd. 19. Applied for foreign currencies interbank call loan limits from financial institutions. 20. Applied for credit line for short-term loans in foreign currencies from financial institutions for OSU. 21. Applied for credit line for short-term loans from financial institutions for Hongkong subsidiaries. 22. Apply to increase the amount of exemption from insurance on issuance of the Company's bills. 23. Review the list of nominees for the 12th Directors and Independent Directors.	For proposal 1 having been withdrawn as approved by Chairman, other proposals didn’t change and have been voted in favor of the resolution without any objection by all the directors present. For proposal 2 to 15 and 17 to 22, The chairman has the assent of all the Directors present voted in favor of the resolution without any objection. After the Deputy Chairman put forward the 16rd proposal for approval, it was passed unanimously by the Directors present at the meeting without any objections (excluding Chair- man who recused themselves from voting). After the Chairman put forward the 23rd proposal for approval, it was passed unanimously by the Directors present at the meeting without any objections (excluding Directors who recused themselves from voting).
2021.06.25 The 20th Board meeting of the 11th Board of Directors	1. Modification of the Statement of the 2020 Internal Control System. 2. Amendment to internal control system for derivative instrument transaction. 3. Application for the issuance of an ETN linked to the "TIP FactSet Taiwan Listed Smart Moving and Electric Car Return Index". 4. Application of credit lines for securities lending from JP Morgan Securities and Goldman Sachs Securities. 5. Change of managers. 6. Alternative business premises are searched for futures dealers as remote backup sites. 7. Extension of the 2021 Annual Shareholders' Meeting. 8. Application of credit lines for Sustainability Linked Loan from China Trust Bank. 9. Change of authorized signatory of the financial institution.	All Directors present voted in favor of the resolution without any objection.
2021.07.28 The 1th Board meeting of the 12th Board of Directors	Election matters: The election of the 12nd Chairman. 1. The proposal regarding appointment of Audit Committee members. 2. The proposal regarding appointment of Remuneration Committee members. 3. The proposal regarding appointment of Risk Management Committee members 4. The re-appointment of the President. 5. The appointment of trust supervisor personnel. 6. Work from home Application. 7. Proposal for capitalization of earnings and the Board of Directors' authorization of the Chairman to establish the record dates of ex-rights, ex-dividends, and capital increase. 8. Increase the number of upstream securities firms for commissioned transactions in foreign securities business.	After the Deputy Chairman put forward the proposal for approval, Lin, Kuan-Chen has been unanimously elected as Chairman of the 12th session of the Board. After the Chairman put forward the 1~8 proposal for approval, it was approved unanimously by the Directors present at the meeting without any objection.

2021 Annual Report

III. Corporate Governance

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Meeting Item Resolution
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Meeting	Item	Resolution

2021.08.23 The 2th Board meeting of the 12th Board of Directors	1. Discussed the Company's 2021 Q2 individual financial statements and the consolidated financial statements. 2. Amendment to internal control system. 3. Renewal of liability insurance for Directors and key personnel. 4. Formulation of rules for transactions with stakeholders. 5. The implementation status of the principle of fair treatment to consumers from April to June in 2021. 6. Application of credit lines for short-term loans from financial institutions. 7. Application of credit lines for short-term loans in foreign currencies from financial institutions for OSUs. 8. Application of credit lines for short-term loans from financial institutions for Hong Kong subsidiaries. 9. Change of managers. 10. Periodic review and evaluation of the policy and structure for the remuneration of the Company's Directors. 11. Remuneration of the President. 12. The proposal regarding the remuneration of the 12th Board of Directors. 13. The proposal regarding the remuneration of the 12th Independent Directors. 14. The proposal regarding the remuneration of the 12th Chairman.	After the Chairman put forward proposal 1~10 and 12 for approval, they were approved unanimously by the Directors present at the meeting without any objections. After the Chairman put forward proposal 11 for approval, it was approved unanimously by the Directors present at the meeting without any objections. (The President recused himself) After the Chairman put forward proposal 13 for approval, it was approved unanimously by the Directors (excluding independent directors) present at the meeting without any objections. After the Deputy Chairman put forward proposal 14 for approval, it was approved unanimously by the Directors (excluding Chairman) present at the meeting without any objections.
2021.11.04 The 3th Board meeting of the 12th Board of Directors	1. Report 2022 annual audit plan. 2. Modification of information security policy. 3. Application of providing structured products with foreign currency principal linked to foreign currency bond options (non-principal-protected). 4. Established the limits for the Company's overall and departmental risk in 2022. 5. Application of increase in the credit lines of non-restricted purpose loans for Hsinchu Branch customers. 6. Amendment to internal control system for accepting orders to trade foreign securities. 7. Increased the number of upstream securities firms for accepting orders to trade foreign securities for offshore securities unit. 8. Application of increase in the credit line of securities lending for foreign legal entity customers. 9. Change of managers. 10. Periodic review and evaluation of the remuneration policy and structure for the Company's senior executives and managers. 11. Re-appointment of consultants and their compensation. 12. Set up Chief Information Securities Officer. 13. 2022 budget and operation plan. 14. Write off bad debt of 2021. 15. Applied for credit lines for short-term loans from financial institutions. 16. Applied for credit lines for short-term loans in foreign currencies from financial institutions for OSUs. 17. Applied for credit lines for short-term loans from financial institutions for overseas subsidiaries. 18. The implementation status of the principle of fair treatment of consumers from July to September in 2021. 19. Establishment of Strategy Development Committee Charter. 20. Establishment of Strategy development Committee and the appointment of the members. Extempore Motion : Application for the issuance of an ETN linked to the "TIP FactSet Taiwan Listed PCB Return Index" and "TIP FactSet Taiwan Listed IC Design Return Index".	All Directors present voted in favor of the resolution without any objection.

President Securities Corporation

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Meeting	Item	Resolution

2022.03.08 The 4th Board meeting of the 12th Board of Directors	1. Review of 2021 Business Report and Consolidated and Individual Financial Statements. 2. The proposal for 2021 profit sharing remuneration ratio for employees and directors. 3. The proposal for 2021 profit sharing remuneration for employees and directors. 4. 2021 Earnings Distribution. 5. Convene 2022 Annual Shareholders' Meeting. 6. CPA independence and competency evaluation. 7. Dissolution of overseas investment President Securities (Hong Kong), President Wealth Management (Hong Kong), and President Securities (Nominee) Ltd. 8. Report Statement of the 2021 Internal Control System. 9. Amendment to Internal control system of Information System Department. 10. Report the overall implementation status of information security. 11. The implementation status of the principle of fair treatment to consumers in 2021. 12. Application for the issuance of an ETN linked to the "HSTECHF", "HSCEI2LI", and "HSISI". 13. Revision of the Chinese name of the indexes to which ETNs are linked. 14. Revision of the name of structured products. 15. Disclosure of qualitative information for risk management. 16. Application of Global Master Repurchase Agreement (GMRA) for foreign bond with financial institutions. 17. Amendment to internal control system for brokerage business. 18. Amendment to the brokerage service fee rate and discount policy operating system. 19. Amendment to the Procedures for Handling Consumer Disputes. 20. Application of increase in the credit lines of non-restricted purpose loans for Taoyuan Branch customers. 21. Application of increase in the credit lines of non-restricted purpose loans for Changhua Branch customers. 22. Application of increase in the credit lines of securities lending for foreign company customers. 23. Increased the number of upstream securities firms for accepting orders to trade foreign securities. 24. Change of managers. 25. Amendment to Capital Market Department performance bonus policy. 26. Alternative business premises are searched for futures dealers as remote backup sites. 27. Amendment to the Articles of Incorporation. 28. Report 2021 legal compliance risk assessment report. 29. The Company's 2021 money laundering and terrorist financing risk assessment report. 30. Statement of internal control over AML/CFT. 31. Amendment to the anti-money laundering and counter terrorist financing procedures and plans. 32. Applied for short-term credit lines from financial institutions. 33. Applied for short-term credit lines in foreign currencies from financial institutions for OSUs.	All Directors present voted in favor of the resolution without any objection.

2021 Annual Report

III. Corporate Governance

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Meeting Item Resolution
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Meeting	Item	Resolution

2022.05.05 The 5th Board meeting of the 12th Board of Directors	1. Apply for foreign currency call loan business. 2. Establishment of Conflicts of interest avoidance policy. 3. Amendments to Rules and Procedures of the Shareholders' Meeting. 4. Amendments to 2022 Shareholders' Meeting Agenda. 5. Amendments to Procedures for the Acquisition or Disposal of Assets. 6. Addition of headquarter business premise registration. 7. Amendments to the operating procedures for the wealth management business. 8. Amendments to Internal control system for brokerage business. 9. Set up level of authority management mechanism for limit of non-restricted purpose loans business. 10. Applied for an increase in the limit of non-restricted purpose loans for branch customers. 11. Change of managers. 12. The proposal regarding change of department managers. 13. 2021 employee remuneration distribution proposal for managers. 14. Implementation of the Principle of fair treatment to consumers from January to March in 2022. 15. Applied for credit line for short-term loans from financial institutions. 16. OSU applied for short-term loan credit line in foreign currencies from financial institutions.	All Directors present voted in favor of the resolution without any objection.

M. Document or written statement that states different opinions by board members or supervisors against the approved major resolutions by the board meeting in recent fiscal period and to the publish date of the annual report: None.
N. Resignation or Dismissal of the Company’s Key Individuals, Including the Chairman, CEO, and Heads of Accounting, Finance, Internal Audit, Corporate Governance Officer and R&D: None.

IV. Information Regarding the Company’s Audit Fee and Independent Auditor

A. Range of Auditing Fee Unit: NT$ thousands

Accounting Firm	Name of CPA	Period Covered by CPA’s Audit	Audit Fee	Non-audit Fee	Total	Remarks
PwC Taiwan	Lin, Se-Kai Lo, Chiao-Sen	2021.01.01- 2021.12.31	5,570	5,859 (Note 1)	11,429	(Note 1)

Note1: Non-audit expenses include Information security evaluation service, related consultation of Sustainable Financial Standards, attestation of Tax Returns, transfer pricing profit indicator analysis, consultation of BVI liquidation and substance filing, CSR report verification and counselling, consultation of share issuance by retained earnings appropriation and new share registration, certification service for salary information checklist for non-executive full-time employees, financial indicator description.
B. If there is any change in the appointed in dependent auditors and the Company’s annual auditing expenses decreased simultaneously, information regarding the amount, percentage and reasons for the decrease in auditing expenses shall be disclosed: Not Applicable.
C. Auditing expenses decreased by 10% in comparison to the previous year, information regarding the amount, percentage and reason for the decrease in auditing expenses shall be disclosed: Audit fee reduced NT850 thousand (13.24%). The amendment of Regulations Governing Information to be Published in Annual Reports of Public Companies caused the change of calculation basis and resulted in difference greater than 10%.

V. Replacement of CPA: None.

VI. If the Company’s Chairman, President, or managers responsible for financial and accounting affairs have held any position in the accounting firm or its affiliates during the past year, all relevant information should be disclosed: None.

President Securities Corporation

VII. Net Change in shareholdings and in shares pledged by directors, supervisors, manages, and shareholders holding more than a 10% share in the Company.

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Unit: Share
2021 As of Mar. 31, 2022
Title Name Holding Pledged Holding Holding Pledged Holding
Increase Increase Increase Increase
(Decrease) (Decrease) (Decrease) (Decrease)
Director Kai Nan Investment Co., Ltd. 1,625,123 0 0 0
Director Canking Investment Co., Ltd. 690,289 0 0 0
Director Leg Horn Investment Co., Ltd. 506,247 0 0 0
Director Hui Tung Investment Co., Ltd. 416,141 0 0 0
Director Ta Le Investment Holding Co., Ltd. 189,682 0 0 0
Director Lee, Tzong-Shiun 33,476 0 0 0
Director Duh, Bor-Tsang 170,949 0 0 0
Director Juang, Jing-Yau 122 0 0 0
Director China F.R.P. Corp. 200,000 0 0 0
Independent Director Pai, Chun-Nan 0 0 0 0
Independent Director Song, Yung-Fong 0 0 0 0
Independent Director Horng, Yuan-Chuan 0 0 0 0
Independent Director Liang, Yann-Ping 0 0 0 0
President Tsai, Sen-Bu 12,781 0 0 0
Proprietary Trading
Department Executive Vice Yang, Kai-Chih 5,566 0 0 0
President
Finance Department Vice
An, Chi-Li 6,374 0 0 0
President
Quantitative Trading
Huang, Jung-Jen 4,380 0 0 0
Department Vice President
Financial Product
Pu, Chien-Heng 0 0 0 0
Department Vice President
Capital Market Department
Wei, Chih-Hsu 0 0 0 0
Vice President
Fixed Income Department
Yeh, Ming-Chieh 0 0 0 0
Vice President
Shareholder Services
Department Sales Vice Chueh, Chih-Chung 98,989 0 (10,000) 0
President
Auditing Office Chief
Huang, Sha-Mei 0 0 0 0
Auditor
Administration Department
Senior Assistant Vice Yu, Hung-Chieh (4,967) 0 0 0
President
Information System
Department Senior Lin, Jung-Hui 3 0 0 0
Assistant Vice President
Compliance Division
Hung, Ying-Che 2,229 0 0 0
Assistant Vice President
President Office Corporate
Governance Assistant Vice Chen, Nai-Chen 15 0 0 0
President
Capital Market Department
Chang, Chin-Yung 0 0 0 0
Assistant Vice President
Finance Department
Su, Wei-Lun 0 0 0 0
Assistant Vice President
Financial Product
Department Assistant Vice Chang, Chung-Lin 43,925 0 0 0
President
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2021 Annual Report

III. Corporate Governance

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2021 As of Mar. 31, 2022
Title Name Holding Pledged Holding Holding Pledged Holding
Increase Increase Increase Increase
(Decrease) (Decrease) (Decrease) (Decrease)
Shareholder Services
Department Assistant Vice Chang, Shao-Ping (18,992) 0 0 0
President
Settlement & Clearing
Department Assistant Vice Wu, Sheng-Yu 656 0 0 0
President
Settlement & Clearing
Department Assistant Vice Huang, Chi-Ming 0 0 0 0
President
Quantitative Trading Senior
Department Assistant Vice Lee, Chien-Hsin 0 0 0 0
President
Quantitative Trading Senior
Department Assistant Vice Chien, Pang-Yen 0 0 0 0
President
Capital Market Department
Chen, Chia-Chang 0 0 0 0
Assistant Vice President
Capital Market Department
Chiang, Chang-Kuen 0 0 0 0
Assistant Vice President
Capital Market Department
Lin, Wei-Hung 0 0 0 0
Assistant Vice President
Corporate Client Dept.
Liao, Ling -Yun 0 0 0 0
Assistant Vice President
Information System
Department Assistant Vice Hu, I-Der 4 0 0 0
President
Risk Control Office
Chang, Ping-Chuan 615 0 0 0
Senior Manager
Brokerage Department
Chang, Hung-Shuo 57 0 0 0
Vice President
Brokerage Department
Lin, Li-Lin 249 0 0 0
District Supervisor
Brokerage Department
Chien, Chia-Nan 0 0 0 0
District Supervisor
Brokerage Department
Lee, Chin-Yi 0 0 0 0
Vice District Supervisor
Brokerage Department
Chou, Da-Kuang 0 0 0 0
Vice District Supervisor
Brokerage Department
Senior Assistant Vice Hsh Mei- Shu 0 0 0 0
President
Brokerage Department
Li Yi- Shou 0 0 0 0
Assistant Vice President
Global Institutional
Service Department Senior Wang Shi-Cheng 0 0 0 0
Assistant Vice President
Brokerage Department
Debit Center Assistant Vice Chu, Chen-Pu 0 0 0 0
President
Digital Business Dept. Tsai, Shu-Mei (40,731) 0 (7,000) 0
Senior Manager
Wealth Management and
Trust Department Senior Wang, Fong-Ju 35,247 0 0 0
Deputy Manager
Tunghsing Equity
Chiu, Shyh-Tyng 0 0 0 0
Department Manager
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President Securities Corporation

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2021 As of Mar. 31, 2022
Title Name Holding Pledged Holding Holding Pledged Holding
Increase Increase Increase Increase
(Decrease) (Decrease) (Decrease) (Decrease)
Tunghsing Equity
Tsai, Shu-Mei (40,731) 0 (7,000) 0
Department Manager
Kaohsiung Branch
Wu, Huan-Chung 0 0 0 0
Manager
Dunnan Branch Manager Chiang, Chia-Jung 0 0 0 0
Zhongli Branch Manager Chiang, Tsong-Shyan 0 0 0 0
Chengzhong Branch
Chu, Po-Lin 0 0 0 0
Manager
Chengzhong Branch
Chao, Cheng 0 0 0 0
Manager
Tainan Branch Manager Hsieh, Chia-Hsi 0 0 0 0
Taichung Branch Manager Yang, Kuo-Chen 0 0 0 0
Xin Taichung Branch
Chung, Hui-Ju 35,867 0 (17,000) 0
Manager
Hsinchu Branch Manager Lee, Chin-Yi 0 0 0 0
Chiayi Branch Manager Huang Hsiang-En 0 0 0 0
Pingtung Branch Manager Wang, Chien-Min 0 0 0 0
Keelung Branch Manager Hung Chien- Han 0 0 0 0
Yonghe Branch Manager Wu, Han-Chang 0 0 0 0
Hsinying Branch Manager Hsiao, Po-Ming 0 0 0 0
Changhua Branch Manager Yu, Fu-Tsun 0 0 0 0
Taoyuan Branch Manager Hsiao, Ju-un 0 0 0 0
Yuanlin Branch Manager Chen, Hung-Tsai 0 0 0 0
Sanchung Branch Manager Chang, Shih-Min 0 0 0 0
Shilin Branch Manager Hsu, Fu-Chiang 0 0 0 0
Panchiao Branch Manager Lo, Shih-Hong 0 0 0 0
Sanduo Branch Manager Tai, Hung- Da 0 0 0 0
Szichih Branch Manager Lin, Yu-Ju 0 0 0 0
Ilan Branch Manager Chiang, Jen-Chu 939 0 (939) 0
Nanjing Branch Manager Chou, Da-Kuang 0 0 0 0
Kinmen Branch Manager Yu, Ping-Tse 0 0 0 0
Tucheng Branch Manager Kao, Ming-Chou 0 0 0 0
Songjiang Branch Manager Hsh, Hua- Show 0 0 0 0
Songjiang Branch Manager Chang, Chih-Hsiang 0 0 0 0
Neihu Branch Manager Tseng, Chien-Ming 0 0 0 0
Renai Branch Manager Liu, Yi-Chun 0 0 0 0
Pingzhen Branch Manager Li, Shu-Jung 0 0 0 0
Zhunan Branch Manager Su,Yung-Sheng 13,368 0 0 0
Offshore Securities Unit
Chang, Hung-Shuo 57 0 0 0
Branch Manager
10% Shareholder Uni-President Enterprises Corp 16,058,331 0 0 0
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2021 Annual Report

III. Corporate Governance

VIII. Information Disclosing the Relationship between any of the Company’s Top Ten Shareholders

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As of April 25, 2022
Shareholding
The relationship between any of the
Shareholding Spouse & Minor by Nominee
Name Arrangement Company’s Top Ten Share holders Remarks
Shares % Shares % Shares % Name Relation
1. President Chain
Store Corp. Investees for whom
Uni-President valuation is conducted
Enterprises Corp. 417,516,621 28.678 0 0 0 0 2. Kai Nan under the equity NA
Investment Co., method
Ltd.
Lo, Chih-Hsien
Kao, Shiow- Ling
Delegate of
0 0 4,018,979 0.276 0 0 Delegate of Kao Spouse NA
Uni-President
Chyuan Inv. Co., Ltd.
Enterprises Corp.
President Securities
Corporation - Trust 42,719,868 2.934 0 0 0 0 NA NA NA
Account
Kai Nan Investment Uni-President
42,253,212 2.902 0 0 0 0 Note 2 NA
Co., Ltd. Enterprises Corp.
Lo, Chih-Hsien
Kao, Shiow- Ling
Delegate of Kai
0 0 4,018,979 0.276 0 0 Delegate of Kao Spouse NA
Nan Investment
Chyuan Inv. Co., Ltd.
Co., Ltd.
President Chain Uni-President
40,545,111 2.785 0 0 0 0 Note 2 NA
Store Corp. Enterprises Corp
Lo, Chih-Hsien
Kao, Shiow- Ling
Delegate of
0 0 4,018,979 0.276 0 0 Delegate of Kao Spouse NA
President Chain
Chyuan Inv. Co., Ltd.
Store Corp.
Tainan Spinning Hsin Yung Hsing
34,096,102 2.342 0 0 0 0 Note 3 NA
Co., Ltd. Investment Co., Ltd.
Eternal Materials
33,366,767 2.291 0 0 0 0 NA NA NA
Co., Ltd.
Kao Chyuan Inv.
32,988,828 2.265 0 0 0 0 NA NA NA
Co., Ltd.
Kao, Shiow- Ling Lo, Chih-Hsien
Delegate of Kao Delegate of Uni-
4,018,979 0.276 0 0 0 0 Spouse NA
Chyuan Inv. Co., President Enterprises
Ltd. Corp.
Dr. C. Y. Kao’s
Non-Profit
Foundation
of Culture & 18,975,361 1.303 0 0 0 0 NA NA NA
Education (In
Memory of His
Mother)
Canking
Investment Co., 17,947,517 1.232 0 0 0 0 NA NA NA
Ltd.
Hsin Yung Hsing
Tainan Spinning Co.,
Investment Co., 15,711,845 1.079 0 0 0 0 Note 3 NA
Ltd.
Ltd.
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Note 1: The shareholding ratio was calculated based on the 1,455,831,343 shares of the share capital of President Securities Corporation.

Note 2: Affiliates of Uni-President Enterprises Corp.

Note 3: Hsin Yung Hsing Investment Co., Ltd. is director of Tainan Spinning Co., Ltd.

President Securities Corporation

IX. Ownership of Shares in Affiliated Enterprises

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As of March 31, 2022
Ownership by the Direct or Indirect Ownership by
Total Ownership
Affiliated Enterprises Company Directors, Supervisors, Managers
Shares % Shares % Shares %
President Futures Co., LTD 63,817,303 96.69 0 0 63,817,303 96.69
President Capital Management Corp. 30,000,000 100.00 0 0 30,000,000 100.00
President Securities (Hong Kong) Limited 192,600,000 100.00 0 0 192,600,000 100.00
President Securities (Nominee) Limited 1,000,000 100.00 0 0 1,000,000 100.00
President Wealth Management (HK) Ltd. 23,400,000 100.00 0 0 23,400,000 100.00
Jin Yuan President Securities Limited (Note2) 588,000,000 49.00 0 0 588,000,000 49.00
Uni-President Asset Management Corporation 14,904,630 42.46 12,000 0.03 14,916,630 42.49
President Insurance Agency Co., Ltd. 1,000,000 100.00 0 0 1,000,000 100.00
PSC Venture Capital Investment Company Limited 30,000,000 100.00 0 0 30,000,000 100.00
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Note : President Securities (BVI) Limited was liquidated in September, 2021.

Note 1: President Securities (Hong Kong) Limited, President Securities Nominee Limited, President Wealth Management (Hong Kong) Limited was approved by the board of directors to deal with the dissolution and liquidation matters. The liquidation process is currently in progress.

Note 2: Jin Yuan President Securities Limited has no shares issuin. The Company investment amount is 588,000,000 RMB dollars.

X. Name and position of the employees with the top ten amounts of bonuses as well as the total amounts of the top ten bonuses

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Unit: NT$ thousands
Name Title Bonuses (Note)
Tsai, Sen-Bu President
An, Chi-Li Vice President
Lin, Li-Lin District Assistant Vice President
Chang, Hung-Shuo Vice President
Yeh, Ming-Chieh Vice President
3,488
Huang, Jun-Jen Vice President
Huang, Sha-Mei Auditing Office Chief Auditor
Yang, Kai-Chih Executive Vice President
Pu, Chien-Heng Vice President
Chueh, Chih-Chung Sales Vice President
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Note 1: Receive employee bonuses for 2020 in 2021.

Note 2: The sequence below president is arranged based on the number of strokes of the last name in Chinese.

2021 Annual Report

III. Corporate Governance

XI. Training of Directors and Supervisors

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Date of
Title Name Date Organization Course Credit
Inauguration
Risk management of Anti-
Money-laundering, Counter-
Taiwan Institute of
2021.08.23 Terrorism-Financing, and 3
Lin, Kuan-Chen Directors
Principles for Treating
Delegate of Kai
Chairman 2021.07.20 Customers Fairly
Nan Investment
Co., Ltd
Implementing sustainable
Taiwan Institute of
2021.05.06 finance toward Green Finance 3
Directors
2.0
Risk management of Anti-
Money-laundering, Counter-
Taiwan Institute of
2021.08.23 Terrorism-Financing, and 3
Liu, Tsung-Yi Directors
Principles for Treating
Delegate of Kai
Director 2021.07.20 Customers Fairly
Nan Investment
Co., Ltd.
Implementing sustainable
Taiwan Institute of
2021.05.06 finance toward Green Finance 3
Directors
2.0
Corporate Governance
Taiwan Institute of
2021.10.22 3.0 - Blueprint of Future 3
Directors
Sustainable Development.
Risk management of Anti-
Money-laundering, Counter-
Taiwan Institute of
2021.08.23 Terrorism-Financing, and 3
Directors
Principles for Treating
Chen, Kuo-Hui
Customers Fairly
Delegate of Kai
Director 2021.07.20
Nan Investment
Implementing sustainable
Co., Ltd. Taiwan Institute of
2021.05.06 finance toward Green Finance 3
Directors
2.0
Obligations and
Responsibilities of Companies,
Taiwan Institute of
2021.04.23 Directors, and Supervisors 3
Directors
under the Securities and
Exchange Act.
Corporate Governance
Taiwan Institute of
2021.10.22 3.0 - Blueprint of Future 3
Directors
Sustainable Development.
Risk management of Anti-
Money-laundering, Counter-
Taiwan Institute of
2021.08.23 Terrorism-Financing, and 3
Directors
Hsieh Hung, Hui- Principles for Treating
Tzu Customers Fairly
Director Delegate of Kai 2021.07.20
Nan Investment Implementing sustainable
Taiwan Institute of
Co., Ltd. 2021.05.06 finance toward Green Finance 3
Directors
2.0
Obligations and
Responsibilities of Companies,
Taiwan Institute of
2021.04.23 Directors, and Supervisors 3
Directors
under the Securities and
Exchange Act.
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President Securities Corporation

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Date of
Title Name Date Organization Course Credit
Inauguration
Corporate Governance
Taiwan Institute of
2021.10.22 3.0 - Blueprint of Future 3
Directors
Sustainable Development.
Risk management of Anti-
Money-laundering, Counter-
Taiwan Institute of
2021.08.23 Terrorism-Financing, and 3
Directors
Principles for Treating
Lu, Li-An
Customers Fairly
Delegate of Kai
Director 2021.07.20
Nan Investment
Implementing sustainable
Co., Ltd. Taiwan Institute of
2021.05.06 finance toward Green Finance 3
Directors
2.0
Obligations and
Responsibilities of Companies,
Taiwan Institute of
2021.04.23 Directors, and Supervisors 3
Directors
under the Securities and
Exchange Act.
Corporate Governance
Taiwan Institute of
2021.10.22 3.0 - Blueprint of Future 3
Directors
Sustainable Development.
Risk management of Anti-
Money-laundering, Counter-
Chen, Ching-Yi Taiwan Institute of
2021.08.23 Terrorism-Financing, and 3
Delegate of Kai Directors
Director 2021.07.20 Principles for Treating
Nan Investment
Customers Fairly
Co., Ltd.
Obligations and
Responsibilities of Companies,
Taiwan Institute of
2021.04.23 Directors, and Supervisors 3
Directors
under the Securities and
Exchange Act.
Corporate Governance
Taiwan Institute of
2021.10.22 3.0 - Blueprint of Future 3
Directors
Sustainable Development.
Risk management of Anti-
Chen, Yi-Ling
Money-laundering, Counter-
Delegate of Kai Taiwan Institute of
Director Nan Investment 2021.07.20 2021.08.23 Directors Terrorism-Financing, and 3
Principles for Treating
Co., Ltd.
Customers Fairly
Obligations and
Responsibilities of Companies,
Taiwan Institute of
2021.04.23 Directors, and Supervisors 3
Directors
under the Securities and
Exchange Act.
Risk management of Anti-
Money-laundering, Counter-
Taiwan Institute of
2021.08.23 Terrorism-Financing, and 3
Teng, Wen-Hwi Directors
Principles for Treating
Delegate of Kai
Director 2021.07.20 Customers Fairly
Nan Investment
Co., Ltd.
Implementing sustainable
Taiwan Institute of
2021.05.06 finance toward Green Finance 3
Directors
2.0
----- End of picture text -----

2021 Annual Report

III. Corporate Governance

==> picture [542 x 727] intentionally omitted <==

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

Date of
Title Name Date Organization Course Credit
Inauguration
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Lee, Chi-Ming Directors
Principles for Treating
Delegate of Hui
Director 2021.07.20 Customers Fairly
Tung Investment
Co., Ltd.
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Chang, Ming-Chen Directors
Principles for Treating
Delegate of Leg
Director 2021.07.20 Customers Fairly
Horn Investment
Co., Ltd.
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Tu, Li-Yang Directors
Principles for Treating
Delegate of Ta
Director 2021.07.20 Customers Fairly
Le Investment
Holding Co., Ltd.
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Directors
Lee, Shu-Fen Principles for Treating
Director Delegate of China 2021.07.20 Customers Fairly
F.R.P. Corp.
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Directors
Principles for Treating
Customers Fairly
Director Duh, Bor-Tsang 2021.07.20 Taiwan Corporate How enterprise should execute
2021.08.09 Governance risk management in the face of 3
Association COVID incidents.
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
Taiwan Securities Case study on wealth
2021.10.08 inheritance model--stock and 3
Association
real estate transfer.
Exploring Legal Liability for
2021.09.07 Taiwan Securities fraudulent financial report 3
Association and Insider Trading and Case
Study.
Director Lee, Tzong-Shiun 2021.07.20
Taiwan Securities Exploring financial
2021.09.07 information for business 3
Association
decision-making.
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Directors
Principles for Treating
Customers Fairly.
----- End of picture text -----

President Securities Corporation

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

Date of
Title Name Date Organization Course Credit
Inauguration
Taiwan Corporate How enterprise should execute
2021.08.09 Governance risk management in the face of 3
Association COVID incidents.
Director Juang, Jing-Yau 2021.07.20
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Directors
Principles for Treating
Independent
Liang, Yann-Ping 2021.07.20 Customers Fairly
Director
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Directors
Principles for Treating
Independent
Pai, Chun-Nan 2021.07.20 Customers Fairly
Director
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
Case study on Non-arm's
Independent Director Length Transaction Crime and
2021.10.14 3
Association Taiwan Breach of Trust in Securities
and Exchange Act.
Independent Director Case study on Board of
2021.09.30 3
Association Taiwan Directors practice-simulation.
Development trend and
Independent Director countermeasure strategy of
2021.09.16 3
Association Taiwan FinTech in financial service
industry during pandemic.
Independent
Song, Yung-Fong 2021.07.20
Director Risk management of Anti-
Money-laundering, Counter-
Taiwan Institute of
2021.08.23 Terrorism-Financing, and 3
Directors
Principles for Treating
Customers Fairly.
Implementing sustainable
Taiwan Institute of
2021.05.06 finance toward Green Finance 3
Directors
2.0.
Strengthening Board of
Independent Director
2021.03.23 Directors' function through 3
Association Taiwan
Corporate Governance 3.0.
Risk management of Anti-
Taiwan Institute of Money-laundering, Counter-
2021.08.23 Terrorism-Financing, and 3
Directors
Principles for Treating
Independent Horng, Yuan-
2021.07.20 Customers Fairly
Director Chuan
Taiwan Institute of Implementing sustainable
2021.05.06 finance toward Green Finance 3
Directors
2.0
----- End of picture text -----

2021 Annual Report

III. Corporate Governance

XII. Manager Learning

==> picture [541 x 656] intentionally omitted <==

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

Title Name Date Organization Credit Course
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Lin, for Treating Customers Fairly.
Chairman
Kuan-Chen
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
for Treating Customers Fairly.
President Tsai, Sen-Bu
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Executive Directors
Yang, for Treating Customers Fairly.
Vice
Kai-Chih
President
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Vice Huang, Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
President Jun-Jen Directors
for Treating Customers Fairly.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Vice Pu, for Treating Customers Fairly.
President Chien-Heng
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Vice Yeh, for Treating Customers Fairly.
President Ming-Chieh
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Vice Chang, for Treating Customers Fairly.
President Hung-Shuo
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Vice Wei, for Treating Customers Fairly.
President Chih-Hsu
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Sales Vice Chueh, for Treating Customers Fairly.
President Chih-Chung
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
----- End of picture text -----

President Securities Corporation

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

Title Name Date Organization Credit Course
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Vice for Treating Customers Fairly.
An, Chi-Li
President
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Chief Huang, for Treating Customers Fairly.
Auditor Sha-Mei
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
Senior 2021.08.23 Directors 3 Counter-Terrorism-Financing, and Principles
Assistant Yu, for Treating Customers Fairly.
Vice Hung-Chieh
President Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
Senior 2021.08.23 Directors 3 Counter-Terrorism-Financing, and Principles
Assistant for Treating Customers Fairly.
Lin, Jung-Hui
Vice
President Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Assistant for Treating Customers Fairly.
Hung,
Vice
Ying-Che
President
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Assistant Wu, Directors for Treating Customers Fairly.
Vice
Sheng-Yu
President
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
Risk management of Anti-Money-laundering,
Taiwan Institute of
2021.08.23 3 Counter-Terrorism-Financing, and Principles
Directors
Senior Chang, for Treating Customers Fairly.
Manager Ping-Chuan
Taiwan Institute of Implementing sustainable finance toward
2021.05.06 3
Directors Green Finance 2.0.
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100

2021 Annual Report

IV. Capital Structure

I. Shareholders’ equity

A. Source of Capital

Types of shares issued in the most recent year prior to the publication date of this annual report

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Authorized Share Capital Capital Stock Remark
Month/ Issue Price
Capital Increase
Year (Per Share) 1,000 Amount (NT$ 1,000 Amount (NT$ Sources of
by Assets Other Other
shares thousands) shares thousands) Capital
than Cash
Apr- Treasury Stock
10 1,500,000 15,000,000 1,185,706 11,857,062 None Note 1
2009 Retired
Aug- Capital Increase
10 1,500,000 15,000,000 1,231,933 12,319,334 None Note 2
2010 by Earning
Aug- Capital Increase
10 1,500,000 15,000,000 1,304,646 13,046,456 None Note 3
2011 by Earning
Dec- Treasury Stock
10 1,500,000 15,000,000 1,284,582 12,845,816 None Note 4
2011 Retired
Aug- Capital Increase
10 1,500,000 15,000,000 1,323,119 13,231,191 None Note 5
2012 by Earning
Mar- Treasury Stock
10 1,500,000 15,000,000 1,303,796 13,037,961 None Note 6
2016 Retired
May- Treasury Stock
10 1,500,000 15,000,000 1,295,248 12,952,481 None Note 7
2016 Retired
July- Capital Increase
10 1,500,000 15,000,000 1,335,666 13,356,657 None Note 8
2016 by Earning
Aug- Capital Increase
10 1,500,000 15,000,000 1,390,428 13,904,280 None Note 9
2017 by Earning
May- Treasury Stock
10 1,500,000 15,000,000 1,372,390 13,723,900 None Note 10
2019 Retired
Aug- Capital Increase
10 1,500,000 15,000,000 1,399,838 13,998,378 None Note 11
2020 by Earning
Sep- Capital Increase
10 1,500,000 15,000,000 1,455,831 14,558,313 None Note 12
2021 by Earning
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Note 1: Approved by the Financial Supervisory Commission Jin Kuan Cheng3 Tzu No.0980003793 on January 23, 2009.
Note 2: Approved by the Financial Supervisory Commission Jin Kuan Cheng1 Tzu No.0990037293 on July 19, 2010.
Note 3: Approved by the Financial Supervisory Commission Jin Kuan Cheng1 Tzu No.1000033006 on July 15, 2011.
Note 4: Approved by the Financial Supervisory Commission Jin Kuan Cheng1 Tzu No.0970064519 on November 24, 2008 and approved by the Financial Supervisory Commission Jin Kuan Cheng1 Tzu No.1010002095 on January 18, 2012 for the capital change.
Note 5: Approved by the Financial Supervisory Commission Jin Kuan Cheng1 Tzu No.1010030875 on July 12, 2012.
Note 6: Approved by the Financial Supervisory Commission Jin Kuan Cheng Jiao Tzu No.1040048944 on November 23, 2015.
Note 7: Approved by the Financial Supervisory Commission Jin Kuan Cheng Jiao Tzu No.1050010487 on March 31, 2016.
Note 8: Effective after reporting to the Financial Supervisory Commission on July 5, 2016 and approved by Ministry of Economic Affairs Jin So Sun Tzu No.10501197070 on August 10, 2016.
Note 9: Effective after reporting to the Financial Supervisory Commission on July 3, 2017 and approved by Ministry of Economic Affairs Jin So Sun Tzu No.10601121960 on August 28, 2017.
Note 10: Approved by the Financial Supervisory Commission Jin Kuan Cheng Jiao Tzu No.1080305980 on March 5, 2019.
Note 11: Effective after reporting to the Financial Supervisory Commission on June 29, 2020 and approved by Ministry of Economic Affairs Jin So Sun Tzu No.10901155560 on August 24, 2020.
Note 12: Effective after reporting to the Financial Supervisory Commission on July 26, 2021 and approved by Ministry of Economic Affairs Jin So Sun Tzu No.11001166540 on September 17, 2021.
Note 13: As of May 31, 2022, there are no cases where the shares are issued below the par value, and nothing other than cash is used as payments and private placement.

101

President Securities Corporation

1. Type of Stock

Unit: Share

Type of Stock		Authorized Share Capital	Authorized Share Capital	Authorized Share Capital	Remark
		Issued Shares (Note)	Unissued Shares	Total
Common Stock	1,455,831,343 44,168,657 1,500,000,000 Listed on TWSE

Shelf Registration: None.

B. Structure of Shareholders

As of April 25, 2022

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Structure of Foreign
Shareholders Government Financial Other Personal Institutions
Institutional Total
Agencies Institutions Shareholders and Personal
Quantity Shareholders Shareholders
Number of Holders 0 0 266 57,212 202 57,680
Number of Shares 0 0 801,476,089 526,241,322 128,113,932 1,455,831,343
Ownership (%) 0 0 55.053 36.147 8.8 100
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C. Distribution Profile of Share Ownership

1. Common Shares

As of April 25, 2022

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Shareholders Ownership Number of
Ownership Ownership (%)
(Unit:Share) Shareholders
1 ~ 999 23,783 2,523,407 0.173
1,000 ~ 5,000 20,573 43,677,972 3.000
5,001 ~ 10,000 5,377 37,779,407 2.595
10,001 ~ 15,000 2,711 31,971,168 2.196
15,001 ~ 20,000 1,061 18,443,379 1.267
20,001 ~ 30,000 1,345 32,146,323 2.208
30,001 ~ 40,000 635 21,749,241 1.494
40,001 ~ 50,000 399 17,762,732 1.220
50,001 ~ 100,000 891 61,344,007 4.214
100,001 ~ 200,000 453 61,494,186 4.224
200,001 ~ 400,000 239 65,381,305 4.491
400,001 ~ 600,000 60 29,067,741 1.997
600,001 ~ 800,000 32 22,131,879 1.520
800,001 ~ 1,000,000 25 22,369,459 1.537
Over 1,000,001 96 987,989,137 67.864
Total 57,680 1,455,831,343 100.000
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2. Preferred Shares: None.

D. Major Shareholders

As of April 25, 2022

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Shareholding Shareholders Number of Shares Ownership (%)
Uni-President Enterprises Corp. 417,516,621 28.678
President Securities Corporation - Trust Account 42,719,868 2.934
Kai Nan Investment Co., Ltd. 42,253,212 2.902
President Chain Store Corp. 40,545,111 2.785
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102

2021Annual Report

IV. Capital Structure

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Shareholding Shareholders Number of Shares Ownership (%)
Tainan Spinning Co., Ltd. 34,096,102 2.342
Eternal Chemical Co., Ltd. 33,366,767 2.291
Kao Chyuan Investment Co., Ltd. 32,988,828 2.265
Dr. C. Y. Kao’s Non-Profit Foundation of Culture &
18,975,361 1.303
Education (In Memory of His Mother)
Canking Investment Co., Ltd. 17,947,517 1.232
Hsin Yung Hsing Investment Co., Ltd. 15,711,845 1.079
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Note: The shareholding ratio was calculated based on the 1,455,831,343 shares of the share capital of President Securities Corporation.

E. Market Price Per Share, Net Value, Earnings & Dividends for Latest Two Years

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Years
2020 2021 2022Q1
Item
Highest 18.8 28.13 23.8
Market Price
Per Share Lowest 9.46 16.15 19.95
(Note 1)
Average 13.95 22.03 22.33
Before Distribution 21.008 21.763 21.656
Net Worth
Per Share
- - -
After Distribution (Note 2)
Weighted Average Shares
1,399,838 1,455,831 1,455,831
(thousand shares)
Earnings Per
Share Before Adjustment 2.58 2.75 (0.39)
Earnings
Per Share
After Adjustment 2.48 - -
Cash Dividends (NT$) 1.5 1.89 -
Retained Earnings 0.4 - -
Stock
Dividends
Dividends Additional Paid-in
Per Share - - -
Capital
Accumulated Undistributed
Dividend - - -
Price/Earnings Ratio (Note 3) 5.41 8.01 -
Return on
Price/Dividend Ratio (Note 4) 9.30 11.65 -
Investment
Cash Dividend Yield (Note 5) 10.75% 8.58% -
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Note 1: The market price per share is adjusted retrospectively based on earnings distribution.

Note 2: The net worth per share after distribution is filled in based on the distribution determined via resolution at the shareholders’ meeting in the next year.

Note 3: Price / Earning Ratio = Average Market Price / Earnings per Share

Note 4: Price / Dividend Ratio = Average Market Price / Cash Dividends per Share

Note 5: Cash Dividend Yield Rate = Cash Dividends per Share / Average Market Price

F. Dividend Policy and Implementation Status

1. Dividend Policy

We take a policy of dividend payment to maintain sound long-term financial structure and stabilize continual growth to maximize benefits to shareholders, in the following manners:

(1) With regard to the surplus for the year (net of taxes payable and losses from previous years), after

103

President Securities Corporation

portions have been set aside in surplus reserves in accordance with the law and set aside or transferred to the special reserve in accordance with regulations, the balance and undistributed earnings (beginning of the year) may not be distributed if they do not make up at least five percent of paid-in capital.

(2) The total amount of dividend shall not be below 70% of the allocable profit as per the preceding paragraph.
(3) Out of the dividend which can be allocated according to the preceding paragraph, stock dividend shall not be below 50% and cash dividend shall not exceed 50%.
(4) Taking the operation situation of the year and the fiscal plan of next year into consideration, the company may decide the best stock and cash dividend on its discretion.

2. Proposed Distribution of Dividend

The Board adopted a proposal for 2021 profit distribution at its Meeting on March 8, 2022, and the proposal to distribute 2021 profits is a cash dividend of NT$1.89 per share .

G. Impacts of Stock Dividends on Operation Results and EPS: Not Applicable.

H. Compensation of Employees, Directors and Supervisors

1. Information Relating to Compensation of Employees, Directors and Supervisors in the Articles of Incorporation

The Board of Directors passed a motion on January 27, 2016 amending the Company’s Articles of Incorporation, which stated the company will distribute compensation to employees and the Directors from pre-tax profits. Where the company has pre-tax profits, the total value of funds to be distributed among employees shall not be less than 1.6% of pre-tax profits; while the total value of funds to be distributed among the Directors shall not be more than 2% of pre-tax profits. If the company has losses carried forward, compensation should only be paid to employees and Directors after funds have been set aside as reserve for such losses. This amendment was approved in the 2016 shareholders’ meeting.

2. Estimate Foundation of Employee Compensation and Directors’ Remuneration

The Company’s profit in 2021 was based on the income before taxes after deducting the bonuses to the employees and Directors; it was estimated that the bonuses for the employees and Directors accounted for 2% of the income before taxes, respectively. If there were differences between the actual amount and the estimated figures, the profit and loss of 2022 would be adjusted accordingly.

3. Profit Distribution of Year 2021 Approved in Board of Directors Meeting for Compensation of Employees and Directors

(1) The amount of bonuses to the employees, Directors, and Supervisors in the forms of cash or shares. If differences are found in the estimated expenses of the year, the differences, cause, and handling of the differences shall be disclosed.

On March 8, 2022, our Board of Directors passed the proposed allocation of 2% employees’ compensation and 2% remuneration for directors and supervisor in 2021 as follows:

Total employees’ compensation of NT$94,748,034 and total directors’ remuneration of NT$94,748,034.

There was no difference between the estimates and the actual distributions approved at the Board Meeting for Employee bonus and Director/Supervisor compensation.

(2) Ratio of employee bonuses in shares on net profit and total employee bonuses for the period:

There were no employee bonuses in shares for the current period.

4. Information of 2020 Distribution of Compensation of Employees, Directors and Supervisors

On March 23, 2021, the Board of Directors passed the proposed allocation of employees’ compensation and remuneration for directors and supervisor in 2020 as follows: Employees and directors bonus

104

2021Annual Report

IV. Capital Structure

appropriation ratio was 2%, respectively, and distributed in cash.

Employees’ compensation amounted to NT$81,804,081 while remuneration for directors and supervisors amounted to NT$81,804,081. There was no difference between the estimates and the actual distributions approved at the Board Meeting.

I. Buyback of Treasury Stock: None.

II. Long-Term Borrowings: None.

A. Unpaid corporate bonds: None.
B. Corporate bonds due within one year: None.

III. Issuance of Preferred Stocks: None.

IV. Issuance of Global Depositary Receipts: None.

V. Issuance of Employee’s Stock Options: None.

VI. Merge and Acquisition: None.

VII. Working Capital Plans:

Any incomplete share issuance or private placement or any completed share issuance or private placement over the past three years from which benefits have not yet been reported as of March 31, 2022: None.

105

President Securities Corporation

V. Business Environment

I. Description of Business Activities

A. Business Scope

1. Main areas of Business Operations

Underwriting business
Proprietary trading of listed securities
Brokerage for listed securities
Proprietary trading of listed securities through retail locations
Brokerage for listed securities through retail locations
Consignment trading of foreign securities
Securities margin purchase and short sale
Money borrowing or lending in connection with securities business
Securities borrowing and lending
Non-restricted purpose loan business
Shareholder services coordination
Support for futures trading through equity-related business
Concurrent operation of futures proprietary trading
Wealth Management business
Trust business
Financial derivatives products approved by the SFC
Offshore Securities business
Other relevant operations approved by the competent authority

2. Breakdown of Revenues for Latest Three Years

Unit: NT$ thousands

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2019 2020 2021
Item Operating Operating Operating
% % %
Revenue Revenue Revenue
Brokerage 2,221,924 35.67 3,218,058 37.98 5,547,961 52.45
Proprietary
3,726,001 59.81 5,013,874 59.17 4,604,856 43.53
Trading
Underwriting 281,992 4.52 241,052 2.85 425,188 4.02
Total 6,229,917 100.00 8,472,984 100.00 10,578,004 100.00
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3. Products and Services

We offer a comprehensive range of financial services-brokerage, underwriting, proprietary trading, fixed income dealing, financial product development, wealth management, and shareholder services. The following is a brief description of our primary business units.

106

2021 Annual Report

V. Business Environment

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Business Area Products and Services Description
1. Accept orders from clients to buy/sell 1. The market share of brokerage business was 3.17% in 2021,
listed securities and forward to TWSE ranked 12th among the Taiwanese securities firms.
for execution.
2. The Company has 31 branches in total. The market share in
2. Accept orders from clients to buy/sell a single location is 0.1% and ranked 7th among the top ten
listed securities and forward to TPEx Taiwanese securities firms, indicating that the Company’s
for execution. operational efficiency was better than other firms.
3. Manage custodial services for clients. 3. The Company has been active in promoting electronic
trading, where proportion of transactions through electronic
4. Provide margin financing for securities
trading in the entire Company was 43.43% in 2014, 45.05%
trading.
in 2015, 49.71% in 2016, 54.44% in 2017, 64.79% in
5. Securities Borrowing and Lending average in 2018, 68.29% in 2019, 69.15% in 2020 and
Brokerage Business. 78.44% in 2021. The proportion of transactions through
electronic trading has demonstrated significant growth every
6. Non-restricted purpose loan business
year.
7. Accepting orders to trade Foreign
4. The trading system has integrated the trading functions of all
Securities.
products, and customers can use the same electronic trading
8. Futures Introducing Broker Business. platform for trading securities, futures, options, OTC stocks,
sub-brokerage, fund, and overseas futures products.
9. Wealth management business.
5. By offering a more all-inclusive market monitoring and order
entry environment, we can provide services to a larger client
base.
6. We integrate our sales of all types of products available in the
market and thereby offer more value to our existing clients.
1. Trading of publicly listed securities on Over the past 10 years, our proprietary trading department
the TWSE and TPEx, using President has been among the top every year. Regardless of the market
Securities’ own funds. trend, our proprietary trading department is able to accurately
read the market and adjust its strategy accordingly and pick
2. Futures and options markets.
Proprietary out the key trends and sectors. And, they are able to match
Trading 3. Legally-permitted foreign marketable this with effective futures hedging, risk management, and a
securities trading. diverse range of product trading strategies, resulting in big
gains, and small losses. This has allowed us to retain a core
proprietary trading team with considerable experience, which
has become the envy of the industry.
1. Use own capital to trade domestic and The Fixed Income Department mainly focuses on fixed
foreign corporate and government income proprietary trading business, sales, and DCM business,
bonds in the OTC market. supplemented with the issuance of structured products. The
proprietary trading business is mainly based on foreign
2. Offer tendering services of Taiwan
currency-denominated notes, supplemented by New Taiwan
government bonds.
dollar-denominated notes. The main products are US dollar-
3. Repo and Reverse-Repo transactions. denominated and euro-denominated notes. The fixed income
sales, underwriting, issuance of structured products and Bond
4. Trade overseas and domestic convertible
Fixed Income Exchange-Traded Notes are being developed continuously. To
bonds.
Business expand fee businesses via proprietary trading business support.
5. Provide debt capital market services for
overseas and domestic issuers.
6. To trade government and corporate
bonds with customers.
7. Interest rate structured products trading,
design and sales.
8. Designed Bond Exchange-Traded Notes
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Business Area Products and Services Description
1. Futures Proprietary Trading Division: 1. Operating Performance
Market making and trading of legally- In 2021, profitability of our futures proprietary trading
permitted foreign futures and options division was among the top in the industry.
Quantitative contracts.
2. New Products/Services in Development
Trading 2. Strategic Trading Division: As regulators continue to liberalize the industry and allow
ETF arbitrage, market making, new financial products, we stand ready to add these new
structured products issuing and trading. products to our trading and, in turn, to add to our revenue
streams.
1. Equity Warrants (including OTC In 2021, our Financial Products Division was primarily
contract-based warrants) and issuance engaged in issuing new warrants, structured note products, and
of callable bull/bear contracts. other derivative products authorized by the Taiwan’s regulators.
2. Structured products trading. 1. Market Position
(1) Equity Warrants: A total of 4,607 warrants were issued
3. Trading of equity derivatives.
in 2021, for a total dollar value of NT$20,974,001
4. Exchange Traded Note, ETN
thousand, ranked 6th in the market.The market share of
5. Futures & spot strategy trading the firm was approximately 5.80%. The net buy and sell of
premium ranked 4th in the entire market, accounting for
6. Stock promotion business.
approximately 11.06% of the market. It was clear that the
7. Other derivatives financial products efficiency of the net sell was high (while the issue amount
approved by the competent authority.
only accounted for 5.80% of market share, the proportion
of net sell was 11.06%).
(2) Structured note products: For the year of 2021, the
Company undertook contracts amounting to a principal
of NT$30,943,970 thousand and was ranked 2th in the
market. A total of NT$4,998,998 thousand in structure note
products were outstanding at the end of 2021, ranked 5th in
Financial the market.
Products (3) In 2021, the total brokerage transaction volume reached
NT$21,413,806 thousand, ranking second in the market.
At the end of the year, the outstanding amount was
NT$1,033,642 thousand, ranking second in the market.
(4) Exchange-Traded Notes (ETNs): ETNs are new products
that were launched with permission of the competent
authority in 2019. As of December 2021, a total of 34
ETNs were issued in the entire market. The Company also
launched ten diverse ETNs and ranked first in the market in
terms of the number of ETNs launched.
2. New Products/Services in Development
In addition to actively promoting the existing call/put warrant
business, structured product business, and equity options
products, and so on, the Company is currently actively
launching ETNs.The Company will maintain an excellent
quality in market making, provide better warrant services
to investors, and look forward to building consumer trust in
the brand so as to elevate the status of President Securities’
warrants in the market.
By carefully selecting stock targets, a basket of targets were
combined into an ETN to provide investors with a good
choice of asset allocation. President Securities plans to
develop detailed media-based self-teaching lessons, to make
it easier for novice investors to understand the ETN business,
so as to continue to differentiate itself from competitors in
the sector and to expand its market share of new products.
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V. Business Environment

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Business Area Products and Services Description
1. Assist corporations in application for 1. Market Position
public listing on TWSE or TPEx. In 2021, PSC had 58 lead and co-lead underwriting deals, for
a total dollar value of NT$85.23 billion.
2. Assess and advise clients with respect to
capital increase plans. 2. New Products/Services in Development
3. Underwrite domestic and foreign bonds Our goal is to provide professional corporate financial
and issue global or Taiwan depositary services, to simultaneously act as both an effective market
receipts. maker and also as a top-notch service provider, all with the
Underwriting
aim of increasing the company’s overall added value. Going
4. Assist in M&A activities.
(Capital Market) forward we will continue to focus our energy on landing
5. Assess and advise clients with respect mid- and large-sized deals, and will continue to bolster our
to applications to convert private equity presence within the Greater China Region, so as to become a
into publicly traded stocks, treasury more competitive securities firm.
stocks, capital increase plans and
employee’s stock options.
6. Other businesses relate to underwriting
and consulting.
1. Coordinate shareholder services on 1. The scale of the Company’s agency
behalf of publicly listed companies. (1) The number of serviced companies in 2021 was 166,
2. Assist in the coordination of where 91 were listed companies, amounted to 54.82%.
shareholders’ meetings. (2) The scale of the Company’s agency is larger. The average
number of shareholders we serviced in 2021 was 2.17
3. Coordinate the distribution of cash and/
million.
or stock dividends to shareholders.
2. Operating Performance
4. Manage the issuance and delivery of tax
forms to shareholders. (1) The number of serviced companies in 2021 had a 3.75%
Shareholder growth compared to the number of service companies in
5. Respond to shareholder enquiries and 2020.
Services
legal issues.
(2) The number of shareholders’ agents in 2021 had a 10.71%
growth comparable to that in 2020, thus allowing us
to continuously achieve a high economy of scale and
efficient operations.
3. Long-term Objectives
Actively expand the number of serviced companies to
increase revenues.
1. Provide customers with the most 1. Market Position
complete asset arrangement and finance At the end of 2021, the number of customers in the wealth
service planning service. management trust account reached 24,294; the client trust
2. Conduct asset allocation for customers assets reached NT$7.134 billion, including NT$7.124 billion
through trust. for non-discretionary money trust assets and NT$10 million
for marketable securities trust assets. The asset size ranked
Wealth 3. Coordinate the funds of domestic and 9th among securities firms.
Management & foreign commodities, marketable
securities, and structured products on 2. Long-term Objectives
Trust
the Trust Platform. To promote wealth management business 2.0, develop the
full product asset allocation wealth management platform,
4. An employee welfare trust business was
expand the scope of services and provided customers with
launched.
more flexible allocation.
5. Engage in the wealth management
business for high asset clients.
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4. New Products/Services in Development

The Company will continue to promote digitalization and adopt information technology to transform internal processes, strengthen digital management capabilities, as well as increase business momentum and decision-making efficiency. In September 2021, the Company obtained the license to carry out

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wealth management business for high-asset clients and planned three major strategies of wealth management for high-asset clients: “open wealth management business for high-asset clients, diversify financial products and investment channels, expand the scope of business of financial institutions.” Help our customers make appropriate asset allocation through three strategies to meet the investment and financing needs of high-asset customers with investable assets exceeding NT$100 million.

In order to shorten the account opening time for customers, an integrated account-opening platform has been created, integrating all existing types of businesses (securities, sub-brokerage, credit, futures IB, financial instruments, bonds, OSU, and wealth-management trust). All information required for account opening are analyzed and simplified, so that customers can open an account for all businesses by filling out information only once, which greatly enhanced the customer experience.

B. Industry Overview

1. Overall Economic Environment

In the past year, With the popularity of COVID vaccines, countries around the world gradually alleviated border controls, which led to the recovery of global market demand and economic recovery. In the U.S., the introduction of vaccines and the gradual relaxation of regulatory measures have boosted consumer-spending recovery. However, the slow recovery of the employment market and the supply chain crisis has led to continuous inflation. The Fed planned to adjust its monetary policy, which could lead to fluctuations in the global stock, foreign exchange, and bond market. In Europe, vaccination has alleviated the pandemic. The gradual recovery of various industries and the implementation of fiscal policies have led to a rebound in the economy. However, the rapid spread of the Omicron at the end of the year and the rising tensions between Russia and Ukraine brought uncertainties to economic growth. In China, the introduction has significantly modified the industries of tutoring companies, financial technology, online games and real estate, and undermined investors’ confidence.

In Taiwan, In 2021, the domestic economic growth rate increased from 3.36% in 2020 to 6.45%, which was mainly due to the gradual loosening of anti-pandemic restrictions in the U.S. and European countries, which led to an increase in demand from end consumers. With the boosting demand in 5G, high performance computing, IoT, and automotive electronics, the semiconductor industry has expanded investment and drove economic growth. In terms of domestic stock market, due to the continuous quantitative easing in Europe and U.S., the market liquidity is high. Adding up the global economic recovery, fully-occupied capacity of shipping and high demand in semiconductor industry, the TAIEX for the whole year increased from 14,732 points to 18,218 points, representing an increase of 23.7%, with the average daily market volume increase from NT$200.7 billion to NT$391.5 billion.

Looking forward to 2022, With the popularization of COVID vaccine booster shots and effective treatments, the impact of the pandemic will slow down and the employment and demand from end consumer will continue to recover. However, the bottleneck of the supply chain and the war between Russia and Ukraine will drive up the prices of energy and raw materials. As a result of the continuous rise in the price index, the Federal Reserve announced that it would adopt a tight monetary policy, which could impact the global stock, foreign exchange, and bond markets and constrain economic growth. IMF forecasted that the global economic growth rate would decrease from 5.9% of last year to 4.4% in this year. Although there are cases of community spread of Omicron variant, the majority of the confirmed patients only have mild symptoms in Taiwan. The disease control measures are gradually moving towards the direction of co-existence with the virus to reduce the impact on the economy . In terms of investment, as domestic semiconductor leaders continue to increase capital expenditure, expand advanced and mature production capacity, the mass effect of deeper local investment in supply chain gradually emerged. In addition, 5G network built by telecom companies, construction of offshore wind power and solar energy facilities, increased transportation capacity by transportation companies and other private investments are expected to continually grow. Consequently, the Directorate-General of Budget, Accounting and Statistics estimated that economic growth in this year would reach 4.42% in Taiwan.

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V. Business Environment

2. Current Status and Future Development

(1) Primary Market

Unit: NT$ 100 Million

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Corporate Bond
Over-The-Counter
Listed Company Government Bond
Year (OTC) Company Ordinary Corporate Convertible Bond
Bond
Total
Number Capital Number Capital Number Net total Number Net total Number Net total
2003 669 47,252.8 423 6,394.7 80 25,870.7 2,666 7,998.5 235 1,218.1 9,216.6
2004 697 50,580.8 466 6,261.0 86 28,506.7 2,882 8,993.8 349 1,522.1 10,515.9
2005 691 54,159.6 503 6,431.8 88 31,417.2 2,784 9,355.2 322 1,549.0 10,904.2
2006 688 55,226.7 531 7,262.0 90 33,823.2 2,397 9,710.2 292 1,830.1 11,540.3
2007 698 56,016.2 547 7,148.1 88 35,184.7 1,744 8,773.4 276 2,108.0 10,881.4
2008 718 57,354.4 539 7,030.7 91 37,351.7 1,142 9,476.1 269 1,857.7 11,333.8
2009 741 58,695.9 546 7,727.3 93 39,708.5 783 9,413.9 208 1,405.2 10,819.1
2010 758 59,279.5 564 7,059.9 94 43,341.5 512 10,002.1 246 1,373.7 11,375.8
2011 790 61,523.8 607 7,319.2 97 46,441.5 425 11,242.6 299 1,660.3 12,902.9
2012 809 63,849.5 638 6,674.5 100 49,343.0 433 13,641.2 314 1,594.5 15,235.7
2013 838 66,100.3 658 6,618.5 103 52,209.5 468 15,776.1 294 1,542.4 17,318.5
2014 854 67,834.0 685 6,795.6 108 54,401.7 519 17,197.8 277 1,507.7 18,705.5
2015 874 69,509.0 712 7,061.9 113 55,693.7 500 17,081.5 297 1,554.1 18,635.6
2016 892 70,217.0 732 7,152.6 116 56,053.3 500 16,776.4 270 1,483.1 18,259.5
2017 907 71,361.9 744 7,223.6 119 56,363.3 512 17,436.6 193 1,172.6 18,609.1
2018 928 71,588.9 766 7,385.0 124 56,024.7 535 18,120.0 157 1,173.5 19,293.4
2019 942 71,556.4 775 7,466.6 129 55,509.6 569 19,012.0 166 1,186.1 20,198.1
2020 948 72,383.6 782 7422.4 137 56,244.6 681 23,505.6 193 1,338.2 24,843.8
2021 959 73,852.9 788 7,608.6 156 58,393.6 788 27,169.6 237 1,488.3 28,657.9
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Reference: Securities and Futures Bureau, FSC

(2) Overview of total market value of the securities market in the past three years

Unit: NT$ billions

Item	2019	2020	2021
Taiwan Stock Exchange
Stocks	26,464.6	45,654.3	92,289.9
ETF	2,080.5	2,838.6	2,454.5
ETN	2.0	5.6	13.6
Beneficiary Securities	10.0	11.6	5.3
Equity Warrants	497.1	509.2	681.2
TDR	2.4	163.3	72.5
Subtotal	29,056.6	49,182.5	95,517.0
Taipei Exchange
Stocks	7,607.5	12,087.1	20,276.0
Equity Warrants	145.4	154.6	177.4
ETF	854.0	415.4	241.1
ETN	0.7	1.9	8.6
Bonds	44,677.1	40,604.2	29,171.4
Subtotal	53,284.7	53,263.1	49,874.4
Total	82,341.3	102,445.7	145,391.4
TAIEX	11,997.14	14,732.53	18,218.84

Reference: Securities and Futures Bureau, FSC

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3. Relationship with Up-, Middle- and Downstream Companies

The securities market is a part of the financial market as a direct transaction channel between fund seekers and fund providers; industrial and commercial enterprises usually raise funds through the issuance of marketable securities, and investing in marketable securities has become an important way for people to manage their savings and personal wealth. The mission of the securities market is to pool savings and turn them into investment, and thus facilitate economic growth.

Upstream Funds Suppliers Individual Investors Institutional Investors	Midstream Mediator Securities Firms	Downstream

Funds Suppliers	Mediator	Funds Demanders
Individual Investors Institutional Investors	Securities Firms	Listed Companies Financial Institutions Government

4. Product Trends and Relevant Competition

 Proprietary Trading

(1) Equities Markets

The performance of Taiwan’s stock market in 2021 was outstanding due to the government’s successful pandemic prevention measures. The production capacity of domestic enterprises continuously enhanced to successfully deliver orders. The export momentum was strong and the Company’s profitability was astonishing. In 2021, Taiwan’s annual economic growth rate reached 6.28%, which broke the record of past 11 years with a growth rate of 9.20%, 7.76%, 3.70% and 4.88% in respective quarters. The economy was hot and exceled Europe and most Asian countries. TAIEX raised 3,486 points for the whole year with increase rate of 23.66%, which ranked as the second place in Asia next to Vietnam. In terms of international stock market, U.S. stock market performed relatively better than others. S&P 500 raised 26.89%. Nasdaq raised 21.4%. Dow Jones raised 18.7%. Large network and technology companies had strong profit. The strong fundamentals supported the stock price performance. On the contrary, China, Hong Kong, Japan, and Korea stock market performance were behind other markets, especially China and Hong Kong markets. Due to the even stricter monitoring of specific industries by the Chinese government, the property default risk, and the slowed down of economy growth in the second half year, Hang Seng Index dropped 14% for the whole year. Hang Seng TECH Index, being the poorest performer, dropped 32.7%.

In the first half of 2021, benefiting from the gradual easing of the pandemic in Europe and the U.S. and the strong consumption of retail merchandise driven by the financial subsidies of President Joe Biden in the U.S., order conversion effect and demand for end-to-end inventory replenishment, Taiwan’s overseas export trade performance was strong. Orders in electronics and technology companies such as semiconductor, NB consumer electronics, 5G, IoT, ABF substrate were the highest. In addition, the traditional industries, especially shipping, steel, plastic and so on, continued to improve profitability as a result of sharp price increases due to severe imbalance between supply and demand. In May, despite the impact of the COVID spread in Taiwan in the short run and the index fluctuated significantly by 2,500 points, the Proprietary Trader Department’s profit performance was good under the reduction of shareholding level and prudent risk control; thus substantial profits were accumulated.

U.S. financial subsidies had come to an end in the second half of 2021. In terms of monetary policy, due to recovery of economy, robust employment conditions, inflation was ready to start wriggling. Since September, the Fed started to discuss the timeline of reducing debt purchase and balance sheet

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V. Business Environment

shrink. The 10-year treasury bond yield rapidly increased by 1.5%, resulting in increased stock market volatility. The base period for TAIEX was already high. China started energy consumption and intensity dual control system of electricity restriction measures since Q4, which affected part of the productions of Taiwanese companies. The rise of Omicron dragged the pace of recovery in Europe and U.S. The Proprietary Trading Department became prudent in trading and real-time adjusted positions with changes of listed company's fundamentals, sold weak companies and kept strong ones. Hedge through futures was further used to lower the risk. The Company were able to maintain profit in Taiwan stock market and kept the performance at industry leading position.

The operation of overseas stock markets faced larger headwinds. In the China and Hong Kong stock markets, due to the intensive regulatory policies promulgated by Chinese government and the adoption of more stringent monetary credit policies, the China and Hong Kong stock market index dropped. Thanks to the effective control in shareholding position, the loss was under control. In the second half of the year, as the Fed’s attitude gradually changed to be hawkish, the style significantly changed and the market volatility was extremely volatile. There was still a profit contributed to the Company in the whole year. The department continued to invest in research and company visit, and fully grasp the direction of the new international trend.In the future, the Department will continue to intensify global macroeconomic research and flexibly adjust domestic and foreign positions and strategies as the foundation of its operations. It will grasp opportunities for profits in bull markets and diversify investments to expand sources for Department revenue. The Department plans to be among the leaders of profitability in the industry while maintaining its past competitive advantages.

(2) Risk Management

In addition to using VaR figures provided by the proprietary trading department’s risk control office, stop losses and limit alerts are set for the stocks that each trader trades. Each trader is given trading limits and trading performances are updated in real time and, when necessary, trading authorizations can be immediately revoked. The effect of all of these measures is to ensure maximum protections for our shareholders.

(3) Hedging Operations

Futures and options are our primary hedging tools. Inverse ETF and individual stock futures were used as hedging. Going forward, we will continue to use these financial products to adequately hedge our proprietary trading department’s exposure.

 Fixed Income Dealing

(1) Outright Purchases and Sales of Government Bonds

Monetary policy will be normalized this year. The debt purchase has come to an end, interest rate hiked and the shrinkage of balance sheet was expected in the second half of the year. Currently inflation continues without an end, the development of U.S. debt is weak, so the operation in this regard will be conservative and prudent. We will continue to observe whether the tightening of rate is too fast to sustain the market, or if inflation begins to fall so as to proactively trade US bonds. For the domestic government bond market, the Central Bank expects to increase interest rates at least one basis point in this year. After the government bond bounce from the end of last year to the beginning of this year, there is still momentum on the buy side while the market remains volatile temporarily. There is still a risk of rebound. Therefore, the trading of domestic government bonds this year will be conducted discreetly, and attention will be paid to liquidity risks.

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(2) Convertible Bonds, Futures and Options

For convertible bonds, two strategies will be carried out. The first is to invest in bonds with large issuance size and limited downside risk, because better liquidity, capital structure, and limited risk are good for long term strategy to capture the trend. The second is to invest in notes with rally potential for short term trading. Because of high volatility, traders will control total positions for risk managing. The proportion is generally low so as to keep the level of risk under control. In recent years, due to an increase in market activity, the degree of activity in the convertible bond market has gradually increased. With an increase in the number of bonds issued by various industries, conditions are also more conducive to dispersing the allocation of positions to reduce the risk of concentration of individual targeted industries.

(3) Foreign Bonds

In the post-pandemic era, the global economy suffered inflationary pressure due to rising demand and supply shortages. The Fed had to tighten its monetary policy at a faster pace, raise interest rates more quickly and with more uncertainty, execute continuous shrinkage of balance sheet, which adversely affected the foreign bond market. The government bond yield rate and credit spread for debenture bonds both faced the pressure to increase. The Company plans to lower the position to the utmost to decrease risk exposure in bond. The Company will wait until the signal of inflation pressure decrease.

 Financial Products Business

(1) Equity Warrants

In 2021, there was a strong expansion in Taiwan’s equity warrant market, with all securities firms aggressively issuing warrant products. A total of 49,179 equity warrants were issued in 2021, for a total dollar value of NT$361.4 million.

The total dollar value of all equity warrants issued by the company in 2021 was NT$20.9 billion and the market share was 5.80%, ranked 6th in the market. Issue focuses mainly on the selection of stock performance with good Return on Equity (ROE) to create a win-win situation with investors and stable profits through different derivatives, futures, and options, etc., with hope to effectively lower hedging costs.

(2) Structured Note Products

The amount of contracts oustanding by the end of 2021 was NT$48.485 billion, the Company’s amount of contracts outstanding by the end of 2021 was NT$4.999 billion and the market share was 10.31%. For a trading volumn of NT$226.596 billion. The Company undertook contracts amounting to a principal of NT$30.944 billion, the market share was 13.66% and was ranked 2nd in the market.

(3) Equity options

This business was launched by the Company in April 2020 for customers. The business is mainly for issuance of over-the-counter (OTC) equity options in the form of long-term options. Call or put options can be issued according to customers’ needs. At the end of 2021, the total contract balance outstanding in the market was NT$2.061 billion. The Company’s outstanding balance was NT$1.034 billion, with a market share of about 50.17%, ranking first in the market. The cumulative total market turnover in 2021 was NT$63.548 billion, and the Company’s contract principal reached NT$21.438 billion, with a market share of about 33.74%, ranking second in the market.

(4) Exchange Traded Note (ETNs)

ETNs provide a new product released by the responsible authorities in 2019. As of December 2021, a total of 34 ETNs had been issued on the market, and the Company has also launched 10 main ENT. In addition to the cash dividends, low volatility, and dividend yield indicators as the basis for initial selection, the Company subsequently issued 5G, MSCI technology, Hang Seng tech, U.S. government bonds, Asia Semiconductor, Smart Mobility and Electric Vehicles and other domestic and foreign index products with great potential to provide investors with diverse investment options. Through the domestic and foreign indexes in diverse fields linked to the products, the Company’s ability to build a system is evident.

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V. Business Environment

Among them, the eight ETNs issued by the Company are as follows:

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Stock Code Stock Name Listing Date
020003 President Dividend Appreciate TR 150 ETN 2019/4/30
020011 President Low Volatility High Dividend TR ETN 2019/12/3
020015 President MSCI USA Minimum Volatility NTR ETN 2020/3/27
020016 President MSCI USA IMI Information Technology NTR ETN 2020/3/27
020018 President TIP Customized Value Growth Total Return Index ETN 2020/7/30
020019 President Taiwan 5G TR ETN 2020/7/30
020021 President Hang Seng TECH Index ETN 2020/12/2
02001B President US Treasury 7-10 Years Index ETN 2020/12/29
020025 President Asia Semiconductor Net Total Return Index ETN 2021/7/22
020030 President Smart Mobility and Electric Vehicles Total Return Index ETN 2021/11/26
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 Underwriting Business (Capital Markets)

(1) Domestic Bond and Equity Underwriting

As of the end of 2021, there were a total of 961 companies listed on the TWSE and a total of 789 companies listed on the Taipei Exchange Market, representing a growth of 1.37% and 0.9%. The Department has actively fought for cases while maintaining risk management. The President Securities’ underwriting cases, which were listed in 2021, included Dyaco International Inc. with NT$1 billion unsecured convertible bonds, Nan Ren Hu Entertainment Co., Ltd. with NT$600 million secured convertible bonds, Max Zipper Co., Ltd. with NT$360 million secured convertible bonds, Gudeng Precision Industrial Co., Ltd raised NT$1.8 billion in cash capital, Luxe Electric Co., Ltd. raised NT$500 million in cash capital, Green River Holding Co. Ltd. KY raised NT$390 million in cash capital, Ta Chen Stainless Pipe Co., Ltd. raised NT$15 billion in cash capital, China Petrochemical Development Corporation raised NT$5,875 million in cash capital., carefully select industries, and focus on company credit risks to provide public listing/OTC listing and fundraising services for companies with healthy finances or those in industries with an excellent outlook.

(2) Financial Advisory

We take great pride in providing professional corporate finance services. In recent years, our financial advisory business has also made great progress and expanded into advisory services dealing with employee stock option exercise prices, offering price for preferred stocks and stock repurchase by listed companies. We will no doubt continue to develop our financial advisory services business with a particular emphasis securities related consulting (i.e., IPOs, mergers, private placements, and other consulting services) around the Greater China Region.

(3) Offshore Underwriting

The Company is actively pursuing public listing and OTC listing operations of Taiwanese companies returning from China, Hong Kong, and Southeast Asia in accordance with market conditions.

(4) Emerging Market Exchange

There were 296 companies listed on the Emerging Stock Board in 2021, a 17.0% increase from 2020 with 253 companies listed. To capture more IPOs, the department has also been actively positioning itself with respect to emerging board targets. However, the IFRS’s launch in 2013 has changed the way emerging board stocks will be assessed, and to take risk control into account, the number of officially recommended emerging board companies is 25 at the end of 2021. This year, the division will continue to compete for quality clients while maintaining risk control, and issue recommendations for emerging stocks based on the progress of its client counseling.

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 Wealth Management & Trust

The total assets under overall securities firms’ non-discretionary individual management in 2021 was NT$158.46 billion(YoY +11.0%). The total assets in securities trust management was NT$25.9 billion(YoY -7.6%). The total assets under management was NT$184.40 billion, which was a 8.1% increase of NT$13.8 billion from the NT$170.64 billion at the end of 2020. Among them, the money trust business continued to grow, while the negotiable securities trust lending business was replaced by the “new two-way securities lending of Taiwanese stocks for natural persons” which only slight growth.

The assets under the Company’s non-discretionary money trusts by the end of 2021 amounted to NT$7.124 billion. The total assets in securities trust management were NT$10 million. The total assets under management were NT$7.134 billion. This ranked the Company 9th among securities firms.The tradable products in wealth management included domestic and overseas funds, domestic and overseas structured products, bonds with repurchasing agreements, and foreign bonds.

In 2021, the Wealth Management and Trust Department continued to expand its product lines; the newly released domestic and overseas funds included AXA, PIMCO , Natixis , FFHC, to make the coverage of fund product lines more complete as funds are available with excellent performance in all major investment sections for customers to choose from. This year, the addition of Hong Kong merchant NOMURA International Securities Taipei branch (NOMURA) issued overseas structured products and the “Employee Stock Ownership Trust” business has been launched to diversify the revenue sources.

C. Research and Development Overview

In line with the competent authority’s requirements for the professionalism of underwriting personnel, this year, based on the courses offered by the Taiwan Securities Association, on-the-job training and further training are arranged; personnel are sent to participate in the professional courses offered by the Taiwan Stock Exchange Corporation (TWSE) and Taipei Exchange on a quarterly basis for intermediaries to be equipped with the knowledge of relevant laws and professionalism as the country is increasingly open to overseas business.

 R&D for Derivative Product

Various Technical Expertise and R&D

We have a complete financial engineering team that brings together talented individuals from finance and statistics with access to top-notch trading and valuation software, so that they can develop innovative product and trading strategies. With cutting-edge financial engineering at the forefront, we bring together comprehensive product development and advanced trading experience in designing new products, and in providing sophisticated derivatives products and consulting services for our customers. Plus, every year, we invest heavily in modernizing our warrant software so as to make our systems faster and more stable, and so as to offer a broader range of services to our customers.

Our Research Analysts, Their Training, and Our R&D Costs for the Most Recent 5 years

The company has been aggressively developing new products and working diligently to secure regulatory approvals for new products. Over the past 5-year period, we have spent an average of NT$4.5 million per year on R&D efforts.

Unit: Person

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Year 2019 2020 2021 Mar. 31, 2022
Number Number Number Number
Education level % % % %
of people of people of people of people
Master&PhD 38 79.17 42 79.25 44 78.57 43 74.14
Bachelor 7 14.58 8 15.09 9 16.07 12 20.69
Others 3 6.25 3 5.66 3 5.36 3 5.17
Total 48 100.00 53 100.00 56 100.00 58 100.00
Average
years of 4.61 5.20 5.60 5.65
service
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New products or Techniques Successfully Developed Within the Last 5 years
(1) The company has been successful in the design and pricing of many structured note products, equity swaps, credit derivative products, as well as equity-linked derivative products, bonds and interest rates, and we stand ready to issue these products whenever appropriate market timing emerges.
(2) We have successfully developed several market operating strategies, as well as option market making models and strategies.
Strengthened the electronic trading and relevant information systems

The electronic trading market continues to grow and the company is able to raise customer service quality through an e-trading platform that is stable, convenient and diversified.

(1) President Securities 2021 Electronic Trading and Information System Relevant R&D Plan

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System R&D Capabilities
Securities brokerage
account-opening outside of Online account opening extension activity.
the company.
Management activity
1. Provide customers with ledger account settlement payment management.
of ledger accounts for
2. Provide customers with convenient one-stop settlement of all transactions.
settlement payments (T+2).
Optimization of the
Enhance the trading safety of electronic transaction platform and add double certification
electronic transaction
mechanism when logging in the platform.
system.
1. Adjustment to settlement and clearance procedures and optimization of the accounting
verification mechanism through the electronic payment platform.
2. Automatic connection and adjustment for processing and accounting of reimbursement
applications and approval.
3. The integration of bond settlement payments, non-trading fund transfers, and structured
product settlement.
E-payment project
4. Security control modules for the authorization of electronic payments.
-Administrative review authorization modules.
-Security control modules for the coordination and authorization of electronic payments.
5. Message communication and key encryption packet.
-Message and key encryption packet modules.
-Communication modules for financial institutions.
Automated transfer-
in of transfer prices in Interface of front-end systems and reduce time for manual maintenance.
management report.
1. Foreign exchange transaction on the spot, cover approval request and approval record
Foreign exchange
inquiry function.
declaration platform.
2. The control and warning of authorized limit.
Non-securitized future
and option bonus activity Adjust activity parameter elasticity according to the Company’s policy adjustment of non-
optimization and correction securitized future and option bonus system.
activity.
The amendment of rule of 1. Decrease the payment of inventory bonus.
non-securitized future and
option product sales bonus. 2. Encourage the development of new customers.
Approval e-project Digitalized business process that can reduce manual document delivery.
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ISM system optimization (OSU bond).	1. Enhance transaction function in response to the OSU bond system. 2. Diversify transaction settlement report analysis. 3. Add dividend distribution activity. 4. Add overseas income report and filing activity.
Middle server system monitoring and management interface (Web version).	The function optimization of each middle server system monitoring function.
Electronic payment and collection system.	1. Single payment and batch payment. 2. Branch settlement payment.
E delivery/LINE@ periodic stock savings broadcast.	1. Hot stock savings target link to stock savings platform. 2. Order placement success broadcast. 3. Broadcast before transaction. 4. Broadcast after conclusion of transaction.
Financial product department ETN product development.	1. U.S. Treasury bond ETN. 2. Asia semiconductor ETN. 3. ETN market making system.
Digital finance division LINE@ platform.	1. Optimization of LINE@ platform. 2. Member bonus table. 3. LINE@ interface revision. 4. Task bulletin on website and app. 5. LINE@ demassified broadcast. Precision marketing. 6. Establish activity webpage. 7. Optimize smart customer service. 8. Digitalize customer complaint system. 9. Revise drawing system.
Digitalize project and systematic control activity system.	1. Single sign on for project data: Simplify collection process. 2. Record in database: Digitalize data organization and keep consistency of the record. 3. Use automatic mechanism: Reduce management and control burden and make control convenient and fast.
Online Account opening	1. Sub-brokerage account. 2. Trust account
Self-develop OSU system.	1. Add OSU custody bank and control customers’ fund. 2. Change bond transaction from T+2 to T+0 to reduce risk. 3. Increase OSU stock trading business to increase number of industries of tradable stock for OSU business.
Text code conversion for depository and custody.	1. Internal conversion of Taiwan Depository & Clearing Corporation text code and follow up maintenance. 2. FTP file conversion for booking of overseas proprietary trading business.
Optimization of the wealth management trading functions.	1. The official new wealth management website was revised and launched. 3. Estimated redemption and account debit date. Disclosure of redemption date net worth. 3. Automatic fund withdrawal after redemption. 4. Stop-loss/take-profit set up. 5. Fund observation list.
Constant Share Purchase.	Respond to the new system of odd lot transaction during trading hours implemented by competent authority and provide investors constant share purchase service in order to assist investors purchase shares periodically.

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(2) 2022 R&D investment plan and progress

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Expected Critical
Current Expected
Project Name Details of Plan and Benefits Project Plan Cost Success
Progress Completion
Outlay Factors
1. Project report category maintenance
2. Project report edit (including cross
audit report).
3. Report sign off and approval In response to
audit requirement,
operation (auditee). enhance overall Completed
Project audit 4. Project report inquiry and print out. operating Expected to design
efficiency, provide services process;
report operating 5. Report statistics and analysis. 10 million Ongoing
implement system in second- business
system. 6. Deficiency follow up and maintenance integration quarter, 2022. process
operation. and function planning
7. Deficiency record file conversion enhancement
operation.
(upload into deficiency data
management system).
8. Authorization management.
1. Annual audit plan file conversion
maintenance and report (including
filing of number of actual execution
and planned number of execution).
2. Audit detail file maintenance
(standard template).
3. Audit working paper file maintenance In response to
(standard template). audit requirement,
4. Perform automatic audit sample enhance overall Completed
Periodic audit selection. operating Expected to design
efficiency, provide services process;
report operating 5. Audit result working paper 15 million Ongoing
implement system in fourth- business
system. maintenance.
integration quarter, 2022 process
6. Audit detail table inquiry and and function planning
maintenance. enhancement
7. Audit report maintenance operation. operation.
8. Report print out operation.
9. Progress inquiry control operation.
10. Authorization management
11. Deficiency record conversion (import
into deficiency data management
system).
Respond to the
roll out of new
Completed
business areas
Trading server Expected to design
Trading server converts FIX connection and improve
converting FIX provide services process;
in order to increase trading speed and service quality 10 million Ongoing
connection in second- business
increase competitiveness. while optimizing
project. quarter, 2022. process
processes and
planning
intergrading
systems.
1. Structured product, overseas bond Respond to the
transaction and asset allocation roll out of new Completed
business areas
President inquiry. Expected to design
and improve
Finance 2. Securities, futures, and option service quality 35 million Ongoing provide services process;
Department transaction and inquiry. in second- business
while optimizing
Store APP. 3. Sub-brokerage, fund, and overseas quarter, 2022. process
processes and
futures transaction and asset trend, intergrading planning
complete allocation inquiry. systems.
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Expected Critical
Current Expected
Project Name Details of Plan and Benefits Project Plan Cost Success
Progress Completion
Outlay Factors
1. A backup trading server room in a
center with a different location has
been established as a backup for the Respond to
main IDC server room in Banqiao. the authorities’ Completed
Establishment Expected to design
2. A complete off-site backup requirement
of an off-site mechanism has been established to ,and the risk 66 million Ongoing provide services process;
backup server in fourth- business
room 3. An offsite backup structure for ensure uninterrupted trading. and security issues regarding quarter, 2022 process planning
electronic transactions has been e-trading.
established to increase transaction
security.
1. General credit limit application.
2. Self-develop OSU system (bond
trading (T+0), stock trading).
3. Monthly credit affiliate account
review automation.
4. Default risk warning measures.
5. Cross marketing management Respond to the
system. roll out of new
Completed
Brokerage 6. Trust and sub-brokerage online business areas
design
Department’s signing area implementation. and improve Expected to
relevant 7. Add online order of short selling service quality 60 million Ongoing provide services process;
business
development function. while optimizing during 2022
projects. 8. T+0 ledger day trading. processes and process
planning
9. Add constant share purchase by intergrading
specified amount. systems.
10.Rebate platform implementation
11.Account manager and sales system.
12.Legal person account service.
13.APP online service.
14.Lending business without a restricted
purpose.
1. The optimization of customer wealth
management and review operation--
depository + credit.
2. Voucher approval operation-
accounting.
3. 162 insufficient stock/stock
deviation notification-depository.
4. Fund and stock disposal operation-
credit.
5. Message of the day control-credit.
6. Low maintenance rate detain
message approval-credit.
7. Securities loan paper document Respond to the
optimization operation-credit. roll out of new
Completed
8. Purchase file transfer operation-key business areas
Brokerage design
in. and improve Expected to
department’s 9. Customer password re-issuance service quality 40 million Ongoing provide services process;
finance break business
operation-account opening. while optimizing during 2022
point project. process
10. Tape reading system service (system processes and
planning
re-opening application for blocked intergrading
tape reading)-account opening. systems.
11. Know your client in a different
office operation-account opening.
12. Automation of depository file
collection operation-depository.
13. Account statement/notification-
credit.
14. Securities/trust/sub-brokerage data
change-account opening.
15. Account closure operation-account
opening.
16. Securities specialist risk fund-
accounting.
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Expected Critical
Current Expected
Project Name Details of Plan and Benefits Project Plan Cost Success
Progress Completion
Outlay Factors
1. Automation of depository file
collection operation.
2. Know your client in a different office
operation.
Respond to the
Settlement 3. Disposal of fund and securities operation. roll out of new business areas Completed
& Clearing 4. 162 insufficient stock/stock deviation and improve Expected to design
Department- notification. service quality 15 million Ongoing provide services process;
related business
5. Voucher approval operation. while optimizing during 2022
development process
projects 6. Online account opening interfacing account opening integration processes and intergrading planning
systems.
platform.
7. Accounting book change trial
calculation and terminal execution in
one-time data input.
1. Paperless voucher attachment
project-Reimbursement application
optimization and add attachment
function in voucher approval
system.
2. Establish finance EIS system.
Respond to the
3. Digitalization of related party roll out of new
Finance transaction disclosure in financial business areas Completed
Department- statement. and improve Expected to design
related 4. Optimization of fund transfer system- service quality 15 million Ongoing provide services process;
business
development NTD fund transfer. while optimizing during 2022
projects 5. Optimization of DSU foreign processes and process planning
currency fund transfer table intergrading
systems.
preparation activity-sub-brokerage
settlement amount calculation.
6. Voucher attachment management
system implementation.
7. ETN tax filing information system
implementation.
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D. Future Business Development

In an effort to establish our core competiveness, it is essential that we have a clear understanding of future trends in the securities industry and then establish a corresponding business development plan. We must also develop strategies that will allow us to accommodate business areas newly approved by regulators so that we are in a position to move quickly in these new markets. Accordingly, we see our business developing in the following ways:

Continue to recruit exceptional talent, and thereby improve our competiveness and, in doing so, increase our market share.
Implement risk management practices and technologies, thereby improving profitability and stabilizing overall business operations.
Improve IT and enhance e-business infrastructure.
Offer professional asset management and provide personalized financial planning services.
Develop foreign market to search for profit opportunity in trading..
Be ready to move on market liberalizations and expand cross-strait businesst.
Cultivate talented researchers and thus raise our abilities in designing new products.
Synergize our business units and enhance our wealth management services.
Build and maintain alliances with financial institutions and corporations outside of the finance industry, relationships that allow for mutual cooperation and mutual benefit.

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Business Short-term Development Long-term Development
1. Promote marketing activities to increase customer transaction 1. Provide professional research and service quality
frequency and increase revenue. to acquire institutional and foreign investor
2. Enhance the construction of various transaction platforms to provide customers.
customers with a more convenient and real-time transaction system. 2. Promote cross (and regional) marketing.
3. Enhance risk management to lower rates of errors. 3. Integrate electronic transaction platforms for
4. Optimize the customer relationship management system. diversified products.
5. Construct a self-help service framework. 4. Increase smart self-help services.
6. Communicate with customers and revitalize static accounts. 5. Conduct periodic personnel training and replace
Brokerage
7. Implement operators' education and training to cultivate versatile ineffective employees.
operators. 6. Promotion and integration of wealth management
8. Promote the wealth management business and provide customers services.
with professional and diversified financial wealth management
services.
9. Promotion of two-way natural person bond loan businesses.
10. Promotion of non-restricted purpose loan business
1. Intensify operations in international stock markets: Include the 1. Enhance internal division of labor and use the
trading authorization of securities in U.S., Japan, Hong Kong, risk management system to increase performance
A shares (Shanghai-Hong Kong-Shenzhen Stock Connect), and of operations and aid supervisors in adjusting
overseas fund. strategies and positions at appropriate times.
2. Implementation of various instruments: Use foreign options to 2. Conduct more extensive company visits and
conduct hedging and non-hedging transactions. maintain information exchanges with other
Proprietary
companies in the industry to increase the
Trading
Company's knowledge of individual listed
companies and thereby increase profits.
3. Expand international investment businesses in
foreign spot transactions as well as research and
investment in futures market that are permitted by
laws.
1. Diversify the scope of transactions by developing different types of 1. Construct a complete global financial product
foreign currencies note trading. database and a comprehensive foreign bond
2. Increase foreign trade counterparties to acquire better opportunities. transaction platform.
3. Increase Ropo counterparties to enhance foreign currencies funding. 2. Strengthen the judgment of global trends and risk
4. Enhance control over the supply end in international bonds to awareness and strengthen sovereign debt trading to
increase opportunities for profits. diversify the risks of trading corporate bonds.
5. Increase the proportion of foreign currencies bond trading to achieve 3. Expand customers for bonds denominated
Fixed Income better performance than trading in domestic market. in foreign currencies and provide them with
Business 6. Increase the proportion of secured convertible bonds with strictly diversified bond products.
risk management to keep high profits. 4. Develop a product line for structured products and
7. Enhance the sales and underwriting capabilities in fixed income strengthen the ability to develop products to satisfy
products to expand fee profits other than proprietary trading. risk preferences and requirements of different
8. Expand corporate-related business and strengthen the connection. customers.
5. Increase relevant commission revenue to balance
the risk-related revenue from proprietary trading.
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Business Short-term Development Long-term Development
1. Warrants business 1. Provide diversified customized financial products
(1) Increase the efficiency in the issuance and sales of warrants and based on customer requirements.
carefully formulate issuance strategies based on main investment 2. Strictly execute risk-monitoring system for
targets in stocks with good historical performance in shareholders' derivatives.
return on equity. Provide diversified product lines with different 3. Diversify hedging products and flexibly implement
strike prices and different maturity dates. options in stocks with the same targets, convertible
(2) Enhance hedging transaction skills and increase the performance bonds, equity options etc. to effectively lower
of transaction systems to increase profits in warrant hedging. various Greeks risks of derivatives.
(3) Diversify hedging products and flexibly implement options in 4. Comply with the openness of the competent
stocks with the same targets, convertible bonds, equity options authority in the future and continue to issue or
etc. in addition to warrant subjects in current stocks to effectively sell domestic and foreign derivative financial
lower various Greeks risks. products as an agent. Continue to demonstrate
2. Structured products the performance of the Company's financial
(1) Design products that are suited for various market situations, engineering team and integrate expertise in
Financial demand-oriented, and profitable, with the aim of allowing financial, information, mathematical disciplines to
Products customers to achieve stable profitability through carrying out enrich the product line of financial products and
transactions of quality target products. disperse revenue sources.
(2) Provide customized products for individuals and institutions.
(3) Establish stable transaction strategies for hedging.
3. ETNs
(1) ETNs are guaranteed by the issuer’s credit to provide
compensation for the indices tracked. Compared with ETFs, there
is no tracking error, which can be a good choice for investors in
asset allocation.
(2) In the future, various types of constituent stocks will be issued.
In addition to the existing filtering indicators, including cash
dividends, low volatility, and dividend yields, future-oriented
technology indices, such as 5G, will also be planned to be
included to aim to issue domestic and foreign target indices with
great potential.
1. Continue to develop transaction strategies and modules to create 1. Enhance strategic real-time measurement and
profits for the department. analysis capabilities and build a comprehensive
2. Strengthen the automated risk control ability for each strategic foreign remuneration risk decision-making and
module. analytical system module.
Quantitative 3. Expand cross-market arbitrage and price difference transactions for 2. Completely systemize and automate the order-
Trading foreign products. placing module and the risk control mechanism.
4. Actively seek market maker qualifications for domestic and foreign
futures and options.
5. Increase the ratio of automated ordering in the department program.
6. Design and issue structured products to increase the source of profit.
1. Respond to changes in the underwriting market, actively seek lead 1. Seek private equity businesses and actively operate
underwriting cases for IPOs, enhance fixed profits; carefully select related investment banking businesses in the
SPO (including CB and ECB) industries and focus on lowering the Greater China Region.
Company's credit risks while targeting medium to large projects. 2. Collaborate across industries for the group to
Underwriting
2. Seek public listing (OTC listing) operations of returning Taiwanese expand customer base in the Greater China Region.
(Capital
companies.
Market)
3. Coordinate with OSU operations in expansion of related investment
banking operations. Cooperate with the Fixed Income Department
to invite foreign financial institutions to issue international bonds in
Taiwan.
1. Assisting companies with handling stock-related affairs as an agent. Actively expand the number of serviced companies.
Shareholder 2. Update operating models in accordance with laws at any time.
Services
1. Continue to increase the product lines for the non-discretionary 1. Develop a wealth management platform for the
money trust and marketable securities trust. development of the whole asset allocation through
Wealth 2. Engage in the wealth management business for high asset clients. financial management trusts.
Management 3. Actively explore corporate business and strive for stable sources of 2. Expand the international financial business and
& Trust profit in response to the launch of employee welfare trusts. increase the competitiveness through offshore
securities units.
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II. Market Conditions

A. Analysis of the Securities Industry

1. Sales and Services Area

Unit: NT$ thousands

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2019 2020 2021
Area
Amount % Amount % Amount %
North 2,124,885 73.13 3,415,940 73.50 6,313,433 74.28
Central 317,315 10.92 413,373 8.89 715,446 8.42
South 463,492 15.95 818,580 17.61 1,470,528 17.30
Total 2,905,692 100 4,647,893 100 8,499,407 100
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Note 1: The amounts in the table above are brokerage fee revenue.
Note 2: The distribution area of the headquarters and branches is as follows: Northern area: Taipei Headquarters and branches in Hsinchu and north of Hsinchu. Central area: Branches extending from south of Miaoli to north of Chiayi. Southern area: Branches south of Tainan and in Kinmen.

2. Breakdown of Market Share According to Business Area

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Business Area Component Market Share Rank
Equity Brokerage Trading
3.17% 12
Volume
Brokerage
Individual Branch 0.10% 7
Warrants Issued (Volume) 11.06% 4
Financial Products
Structure Commodity Business
13.66% 2
Volume
Domestic Bonds 0.40% 20
Fixed Income Business
(Conditional and Outright)
International Bond 2.32% 7
Lead Underwriting Deals (No./ 18 (3.83%)/
5/7
Volume) 5.664 billion (4.30%)
Underwriting
(Note)
Lead and Co-Lead Underwriting 58 (5.67%)/
3/6
Deals (No./ Volume) 8.523 billion (5.32%)
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Note: Due to the difference of calculation base date, the number or volumn of deals may be different from the content of other chapters.

3. A Look at Future Growth as well as Supply and Demand in the Market

In the brokerage business, the Financial Supervisory Commission has been studying diversified financial products, such as “permitting securities dealers to launch ETNs” and “Promotion of the return of overseas funds to Taiwan”, so as to continue to expand the size of the capital market, build a welldeveloped securities market, and enhance the competitiveness of the securities and futures industry every year. The opening of new business means new opportunities that could stimulate increased market transactions. The Company has also remained active in planning related business in hopes of providing customers with more comprehensive product services.

Furthermore, the competent authority cut the stock transaction tax for day trading by half and implemented the policy extension of the implementation period and affected by global securities market activities. The overall trading volume has increased significantly since the implementation of the reduction of the stock transaction tax for day trading, helping to improve market liquidity. Therefore, the daily average turnover of Taiwan stocks in 2021 has increased to NT$477.8 billion. This measure breathed life into the securities brokerage business. The authority also enabled Odd-lot trading during

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the intraday session on October 26, 2020. Such a measure would make people with mediocre incomes easier to invest with a small amount. Thus would attract young people to join the market, slow down the aging trend of Taiwanese stock market, and bring new/young customers for the Company.

In response to Finance 3.0 trends, the Company shall continue to enhance electronic ordering businesses and integrate functions on the transaction platform. The ratio of electronic transaction operations has reached 68.14% in 2019, 69.15% in 2020 and 78.44% in 2021. The Company will provide customers with safer information transactions to ensure the promptness and accuracy of orders and create advantages for the Company’s electronic orders. In addition, the Company shall continue to develop a global transaction platform and provide customers with more international and diversified options once business development matures. It shall also provide quality services to increase customer satisfaction and build company reputation to achieve better performance.

As for our underwriting business, with competition for corporate funds raising deals increasingly intense, many corporations are learning that they have many options available to meet their financing needs, and that equity issues are not always their best opinion. As a result, companies that are properly screened and that demonstrate sufficient creditworthiness, as well as the preferred stock that issued by financial holdings companies and commercial banks, can often be better off turning to convertible bonds. Plus, with the number of large companies that have not already publicly listed shrinking and the demand for integration due to competition within industries increasing, financial advisory business and corporate funding such as private equity, mergers and acquisitions, capital reductions are growing.

The Taiwan government has also recently been actively encouraging foreign companies to consider Taiwan for primary and secondary listings, forcing most domestic underwriting departments to think more broadly and internationally. Add to this the regulators opening up of Offshore Securities Units (OSU), which allow domestic brokerage houses to become more international in scope. Going forward, the Company intends to pursue more international integrated investment banking business in the Greater China Region, and to pursue more foreign companies to list in Taiwan, thereby breathing new energy into Taiwan’s equity markets.

In terms of the President Securities’ proprietary trading business. In 2022, with the global pandemic being controlled, countries are expected to gradually release the lockdown. The biggest variable in the capital market is the tightening of US Fed’s monetary policy, which will have a significant impact on the global stock market, whether in terms of the number of interest rate hikes or the balance sheet shrinking process. Inflation will be the most critical consideration in Fed’s monetary policy decision. If US 10year treasury bond interest rate rapidly increase, the stock market will face a valuation adjustment and turn into a continuation pattern. Recently, Taiwan’s Directorate-General of Budget, Accounting and Statistics has slightly revised its GDP growth rate from 4.15% to 4.42% this year, and is still optimistic about the robust export and investment momentum, especially in the electronics semiconductor industry. Benefiting from the strong demand for chips in application fields such as high-speed computing, 5G, Internet of Things, automotive electronics, etc., Taiwanese Companies continued to invest in production expansion to fulfill its orders. However, CPI consumer prices also rose to 1.93% at the same time, and the first half of the year will be above the 2% inflation alert level. Inflation is an issue that needs to be prudently addressed. In the second half of February, geopolitical risks increased as a result of the Russian military invasion into Ukraine which further boosted energy, bulk raw material prices, high transportation costs and labor costs. The ability to pass down the cost to the downstream to sustain the profit margin will be a demonstration of individual company’s competitiveness. Looking at the variables and potential risks, the operation of the Proprietary Trading Department in the first half of the year will adopt a relatively conservative and moderate strategy. After the uncertainty is gradually eliminated, with the recovery of the post-pandemic economy and the monetary policies of various countries become clear in the second half of the year, it is expected that the stock market will have more

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President Securities Corporation

room to operate.

As for our financial products business, we will continue to pursue increasingly tailored products to meet the needs of our clients as the regulators open up new areas of business. This will require enhancing our hedging activities a risk management models, so as to lower risk and ensure stable returns. Going forward, as the regulators allow greater access to Offshore Securities Units business, we will pursue global equity business and develop foreign derivatives services so as to better diversify our revenue streams.

In the wealth management business, the Compnay actively motivates salespeople to provide wealth management services to customers and expand the breadth of business penetration. Meanwhile, the Company has expanded product lines, including domestic and overseas funds and new structured products on the wealth management platform to provide customers with more choices in asset allocation. The employee benefit trust business has been launched to increase new revenue sources.The Company increased the allocation of sales and marketing personnel to provide professional advisory services on wealth management business for high-asset clients.

4. Market Supply forecast, growth opportunity, and business competitiveness

(1) Our Competitive Strengths
Our corporate image is solid.
We respect professional management and leadership.
Our horizontal organization and human resource costs are well-controlled.
Our position management performance is outstanding in winning percentage.
Our operating costs and risk management are both well-controlled.
(2) Positive Factors
The global economy is in recovery; consumption and investment are picking up, which will drive domestic economic growth.
Capital is readily available and the cost of capital is quite low.
Flexibility in proprietary trading business with industry-leading performance.
Brand image and channel resources of President Group.
(3) Weakness
Financial holding companies have the advantage of capital employment and crisscross integration.
It is hard to mark up brokerage handling charge due to fierce competition.
The aging of domestic population lowers demand for investments.
The salary growth rate of the youth population grows slowly and the low amount of savings makes it difficult to begin investments.

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V. Business Environment

(4) Strategies for Dealing with the Weakness Identified

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Business Unit Strategy
1. Encourage various departments and subsidiaries to work together to develop new business.
2. Transformation into a multi-functional branch to expand the market share and profit.
3. Develop our institutional client business, using asset management business to pursue corporate clients and
combine that with our OSU business, and provide added-value services beyond our conventional securities
services.
4. Expand our spread trading business, increase mid-level customer trading volumes and position turnovers
rates.
5. Enhance internal auditing procedures, reduce client complaints.
6. Customized online brokerage system for institutional and mid-level investors.
7. Increase revenues from securities lending service to investors.
8. Identify under-performing brokers and refocus them towards “Marketing” efforts as a means of making a
breakthrough, or refocusing their efforts on cross-selling of non-traditional products.
9. Cultivate all employees’ abilities to cross-sell a range of financial products, particularly personal financial
planning products and wealth management services.
10. Focus on tiered, wealth management sales efforts that take into consideration client preferences, trading
Brokerage habits, and that provide appropriate product information and that increase trading frequency.
11. Push forward with online brokerage business; implement comprehensive platform that integrates both
information and trading systems. Upgrade online trading system stability and order entry quality.
12. Improve our employee training, assistance in preparation for related licenses, performance management,
and information system knowledge, to upgrade our brokers’ professionalism and productivity.
13. Continue to recruit new employees, cultivate strong management trainees and financial planning
professionals who are familiar with a wide range of products. Train back-office staff to take on sales roles
thereby streamlining HR costs.
14. Evaluate the feasibility of digitizing all back-office operations so as to increase efficiency and to control
costs at individual branches.
15. Implement succession mechanisms for each level of the organization, strengthen our incubation center
functions, retain good talent, solid management training programs, set incentive programs, encourage
successors, smooth generational gaps.
16. Set break-even point for each branch, consider the linkage between target customers and brokers’
performance and branches’ operation outcome, evaluate potential for future profitability, and adjust business
direction.
1. Strictly implement risk control regulations to effectively reduce the impact of systemic risk.
2. Adopt dynamic inventory stock level in the face of market change, switching between “Range Trading” and
Proprietary “Trend Trading” strategies, thereby maintaining an optimal market position.
Trading 3. Improve our research and trading of Emerging Market Exchange equities, foreign-listed equities, and futures
markets, to create more diverse sources of revenue.
4. Add quantitative analysis and technical indicator model analysis to our operating systems.
1. Make good use of macroeconomic databases and develop systematic tools to enhance profitability.
2. Appropriately adjust traders’ mandate and increase traders’ mandates gradually.
3. Enhance traders’ decision making and trading ability.
Fixed Income
4. Strengthen foreign bond research and trading team to meet the growing needs of expanding businesses.
Business
5. Recruit experts for sales and debt capital market to expand the business scope in fixed income market.
6. Develop structured products in different themes with the advantages in the proprietary trading business.
7. Strengthen corporate-related business and diversify the risk of proprietary trading business.
1. Be more consumer-oriented and develop new products to meet these demands.
Financial
2. Strengthen market research and investment analysis of foreign market objectives and issue a variety of
Products
derivative products to provide customers with diverse options for asset allocation.
1. Diversify our trading strategies to better react to market changes.
2. Aggressively pursue market-maker roles in foreign futures and options markets.
Quantitative
3. Expand our range of foreign products traded and increase profitability in foreign products.
Trading
4. Increase the proportion of order placements via automatic trading programs.
5. Increased the integration of resources across multiple departments, thereby creating better synergies.
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Business Unit Strategy
1. Prior to taking initial steps on a given underwriting deal, consultations should be conducted with colleagues
throughout the company’s various departments and divisions so as to accurately access to the realistic profit
opportunities and risks of the deal. Once a deal is ongoing, regular reassessments and revisions should be
made in order to ensure the quality of the overall project.
2. When acting as exclusive sales agent for an issue, a risk assessment report must be generated to determine
Underwriting
if risks fall within the firm’s accepted parameters. Afterwards, daily risk values should be generated and
(Capital
market simulations should be conducted to as so have a clear and timely picture of risk exposure and thus
Markets)
determine when to initiate stop losses or when to take profits. The net effect of all of these efforts will be to
lower overall risk while pursuing the largest possible profit.
3. As for the domestic business, customers of several departments, including Brokerage, Corporate Client,
Wealth Management, Financial Product, and Shareholder Services have been integrated; platforms for
corporate and personal financial services have been established and activated.
1. Improve quality of service:
(1) Respond quickly to legal changes which affect procedures and materials. Improve efficiency of training
cycles. Develop employee knowledge on various regulations and procedures. Enhance mutual support and
Shareholder flexibility among employees. Increase efficiency of human resource utilization.
Services (2) Enhance inter-department cooperation and verifications, thereby ensuring accuracy and security of
Coordination
processes.
2. Enhance efficiency of operations:
Follow the internal objective of “Customer satisfaction, unceasing improvement and innovation”, we will
keep increasing the satisfaction rate of agency business.
1. Help business personnel to obtain the relevant professional licenses and raise their wealth management
competence.
Wealth
2. Aside from providing multiple products, we focus more on the depth of product service.
Management &
Trust 3. Construct cross-device platforms that allow orders to be placed for all types of products, thereby offering
clients added convenience and achieving Bank 3.0 objectives.
4. Enhance customer service and product range to meet the needs of high-asset customers.
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B. Productions Procedures of Main Products

The Company is a securities service provider. The business and services provided by the Company do not involve the production processes for physical products, so it is not applicable.

C. Supply Status of Main Materials

The securities business and services conducted by the Company are in accordance with the laws and regulations of the competent authority. There is no supply of physical materials, so it is not applicable.

D. Major Suppliers and Clients

The Company’s main customers include individuals, legal entities, approved foreign professional investment institutions and natural persons. In the past two years, each customer’s purchase (sales) of products failed to reach 10% of the purchase (sales) of products of the Company per year.

E. Production in the Last Two Years

The value of the securities business and services conducted by the Company cannot be provided as in the general manufacturing industry.

F. Shipments and Sales in the Last Two Years

The value of the securities business and services conducted by the Company cannot be provided as in the general manufacturing industry. The revenue and its ratio of the Company’s main businesses in the past two years are as follow:

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Unit: NT$ thousands
Item 2020 % 2021 %
Brokerage 3,218,058 37.98% 5,547,961 52.45%
Proprietary Trading 5,013,874 59.17% 4,604,856 43.53%
Underwriting 241,052 2.85% 425,188 4.02%
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V. Business Environment

III. Employee Data

Analysis of Average Tenure, Age and Education, for Sales Force in 2020, 2021, and the first quarter of 2022

Unit: Person

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Year 2020 2021 2022Q1
Management 109 117 119
Number of
Regular Staff 1,299 1,302 1,300
Employees
Total 1,408 1,419 1,419
Average Age 46.03 45.91 45.88
Average Tenure 13.74 13.42 13.36
Doctorate Degree 0.21 0.14 0.14
Master’s Degree 16.76 18.39 17.55
Bachelor Degree / Junior
Education (%) 70.88 70.26 71.25
College Graduate
Senior High School 12.15 11.21 11.06
- - -
High School or Less
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Note: Directors and part-time employees are excluded.

Revenue Per Employee

Note: Directors and part-time employees are excluded. Revenue Per Employee	Note: Directors and part-time employees are excluded. Revenue Per Employee	Note: Directors and part-time employees are excluded. Revenue Per Employee
Unit: NT$ thousands
Item	2020	2021
Revenue Per Employee	6,018	7,455

Note: Revenue per employee = total revenue /number of employees

IV. Environmental Protection and Corporate Citizenship

A. Environmental Protection

Based on governmental order #0950007006, each company is required to disclose in its annual report its compliance with the European Union’s Restriction of hazardous Substances Directive (RoHS). The Company is in the securities service industry, so there is no signification environmental pollution nor losses incurred because of environmental pollution (including no compensation and environmental protection audit results documenting any violation of environmental regulations).

B. Corporate Citizenship

President Securities Corporation has been a long-standing supporter of important social charitable activities and, for its efforts, has been recognized with the 7th annual Wenxin Award and the 6th National Civic Service Award, and Top 50 by the Commonwealth magazine in 2013, 2015, 2016, and 2017. Besides, the Company was recognized and reward by the Taiwan Fund for Children and Families in 2013. President Securities Corporation has won the Gold Award in the Finance and Insurance Industry of the Corporate Sustainability Report Awards of the Taiwan Corporate Sustainability Awards (TCSA) for consecutive two years(2020 and 2021). This represents the highest honor in Taiwan’s Sustainable Development report. The Company was also awarded 2021 Taiwan sustainable enterprise excellent award. The Company won 2021 TSAA Taiwan Sustainability Action Award-Bronze medal, was nominated by 2021 5th PWC CSR Influence Award, and Business Today 15th wealth management bank and securities companies “Best sustainable development Award” by “PSC donates to Child Welfare League Foundation for every order you place”.

The Company has taken concrete actions to cooperate with the Taiwan Fund for Children and Families from 2007 to 2021 to help children from financially challenged families with their studies. The Company also mobilized all employees and customers for joint participation and invested actual funds and various equipment to social welfare activities to fulfill corporate social responsibilities, The Company made a donation of NT$2.5 million to the Taiwan Fund for Children and Families providing schooling subsidies in

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2021 in the theme of “Love Will Not Die During Pandemic Prevention”.

Since 2001, The Company has held ““Love Delivery Activities” for consecutive 21 years. The target of the charity is children from financially challenged families supported by Taiwan Fund for Children and Families that provide children from financially challenged families with scholarships. A total of approximately 10,077 elementary school, junior high school, and senior high school students were beneficiaries. The activities have provided school children from poor families with opportunities to explore different academic disciplines for their own development and growth.

An employee blood donation event was held for the first time in 2006 and received an enthusiastic response. Since 2007, the Company has held an employee blood donation event twice a year and extended it to the wider community, which has received a widespread positive response from community residents. Since 2010, the Company has held a blood donation event three times a year. Due to the effects of the COVID-19 pandemic in 2021, the blood donation events were suspended. From 2006 to 2019, a total of 3,517 units of blood had been donated. As a partner of blood donation centers, the Company has been commended by the blood donation centers every year.

The Company launched “PSC donates to Child Welfare League Foundation for every order you place” charity activity in 2021. NT1.1 million was donated to Child Welfare League Foundation Little Helmsman Education Program. The Company participated the minority care public welfare activity held by UniPresident Corporation’s foundation to donate 400 Epidemic prevention kits to the elderly and schoolchildren to fulfill social responsibility.

President Securities Corporation upholds the spirit of “giving back to the community what we take”, and we continue to dedicate ourselves to helping disadvantaged groups and to promote social welfare activities.

C. Work Environment Safety and Precautions

1.In order to maintain the safety and health of employees, an Occupational Safety and Health Project Section has been set up under the Company’s Department of General Affairs. To promote occupational safety and health services, a Type A occupational safety and health business officer and occupational safety and health administrators have been engaged, which have been registered with the Labor Inspection Office, Taipei City Government.
2.The Company pays attention to safety and health in the employees’ work environment. It minimizes hazards in the office environment and also hires full-time health managers and on-site occupational medical specialists while having established a health consultation room to provide health consultation services to employees. Every year, regular employee health examinations are held to let employees understand their health status, take necessary disease and accident prevention and control measures as soon as possible, while a health consultation service is provided to help employees track, analyze, and follow up on each one’s health situation.
3.The Company’s office environment considers the safety of employees to be the top priority. Each entrance and exit is equipped with access control card swiping devices. The entrances and exits of each building are controlled by security personnel during the day, night, and on holidays to ensure the personal safety of employees.
4.In accordance with the requirements of the Building Public Safety Inspection Certification and Filing Regulations, the Company regularly entrusts a professional company to conduct building public safety inspections every two years and has obtained a qualified independent management certificate related to building public safety.
5.The Company’s various mechanical and electrical or fire safety equipment (fire alarms or fire extinguishers, and so on) are in compliance with the provisions of the Fire Services Act; the Company outsources regular fire safety equipment maintenance, repairs, and inspections to a third-party institution every year while filing a report to the competent authority.
6.Smoking is completely banned in the Company’s business premises in accordance with regulations, and janitors are hired to clean the office environment. Office floors and carpets are cleaned and waxed regularly

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to ensure a clean and hygienic work environment.

7.The Company provides employees with a safe and healthy workplace. The office is a comfortable space suited for working as it is equipped with a central air-conditioning system and has adequate lighting.
8.The Company has provided necessary health and first aid facilities, including automated external defibrillators, and has established breastfeeding rooms. The Company organizes health promotion seminars, and provides employees with relevant information and news related to health care as well as disease and accident prevention; this information is updated on the online health education system regularly.
The pandemic broke out at the beginning of 2020. President Securities Corporation treated the disease at the highest level, assigned Administration Department to establish an emergency response task force. The commander convened 16 meetings as of the end of 2021. Backup plans such as personnel and equipment were designed. Employees’ health is daily monitored. The Company took the responsibility to ensure employees’ safety. The Company also proposed policies that are better than those stipulated by the government to protect employees, such as leave for pandemic prevention and vaccination, initiate remote backup and WFH plan in different units depending on change of pandemic, work in the office in turns, and shift offices based on changes in the condition, adjust policy in rolling plans based on change of pandemic. The Company provided consolation money and hospitalization allowance for employees who were diagnosed as COVID positive, and provided rapid test kit for employees to use when necessary by their will. The Company assisted high risk employees to accept PCR nucleic acid test or antigen rapid test for management and follow up. The Company purchased vaccination insurance for all employees and promoted COVID 19 vaccination.

V. Labor Relations & Employee Benefit

A. Employee Benefits, Education and Training

1. Employee Benefits

The company has always maintained a harmonious relationship with its employees. We have spared no expense in providing attractive employee benefits, in providing opportunities for personal growth, in providing a pleasant work environment, and in providing clear and accessible communication channels to all levels of management.

In addition, we go beyond simply offering benefits prescribed by Labor Standard Act, such as annual leave time and number of working hours. Employees also enjoy additional benefits such as group insurance for worker’s compensation, accident medical care, and department dining subsidy. As well, we offer employees funds for weddings and in time of bereavement, and organizes and subsidized employee outings aimed at strengthening relationships between the firm and our employees, and among employees themselves.

The company is committed to creating a reasonable, friendly, and efficient work environment for its employees, an environment that includes strong lines of communication for employees to express opinions and suggestions about the firm. With this in mind, the firm has established an “Employee Suggestion Center” and also organizes regular employee workshops to actively solicit, discuss, and then respond to employee concerns and suggestions. The Company has also dedicated itself to building a safe and equal work place with a proper complaint channel.

In January of 2004, the company expanded its employee benefits to include an “Employee Stock Ownership Trust, (ESOT)”.Each participating employee may decide his/her own monthly contribution to the trust account, and the Company will also set aside a corresponding amount (subject to an award cap according to his/her job rank) as bonus. The aim of this program is to promote long-term commitments from employees as well as encourage healthy savings habits and encourage responsible retirement planning.

To encourage employees to live healthier lives, the Company provides all employees with a smoke-free work environment and arranges annual health checks for employees to improve their physical health. The arrangements are superior to legal requirements. In addition, the Company also conducts periodic

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blood donation activities and physical and spiritual health seminars from time to time to improve employees’ overall health. The activities include sanitation education, policy, and the environment.

The Company also provides a spacious 200-ping sports center which is equipped with comprehensive sports facilities. It also actively promotes various club activities to promote healthier lifestyles for employees. Essentially, all such benefits and programs are designed to foster a harmonious relationship between employees and the company. In addition, the Company was awarded two stars as Best Companies to work for by Department of Labor, Taipei City Government in 2012. The Company was also selected as an Enterprise of Happiness by 1111 Job Bank in 2019. Going forward, we are optimistic to continue to improve upon these relationships, always with the ultimate aim of allowing both the company and our employees to enjoy mutual benefit and growth.

2. Education and training courses, expenditures, and number of hours

The Company values education, training, and talent development. The effects of training in 2021 are described as follows:

 Talent training

(1) Talent development for future channel personnel: To meet the needs of the organization’s business development, assist the brokerage department and the settlement department in nurturing new generation of talents to prepare for organizational development.
(2) Nurturing of top talent: In response to future business development and operation challenges, meeting customer needs and promoting organizational performance. the Company launched a talent pool project to recruit excellent young talents, systematically select and nurture them. The Group will also strengthen its ability in precision analysis, identifying issues, and rapidly proposing innovative solutions, so as to cultivate talents required for business development.
Assist the brokerage channel team management and multi-commodity business promotion.
(1) Training on wealth management operating capability:
(5) Industry trends:

The monthly President Class focuses on analyses of trending industries to provide colleagues with a greater understanding of industry trends to have expertise in wealth management products to provide customers with appropriate financial planning advice and customer service.

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 Assisting institutional client business development.

(1) Professional training for business activities dedicated to institutional clients:

To assist in the promotion of institutional client business, professional trainings related to institutional client business are offered to improve the quality of service and increase the sources of profit from corresponding diversified business activities.

(2) High-asset client business development training:

In order to expand the scope of institutional client business and services, the Company conducted highasset client business development trainings, and extended institutional clients to high-asset clients, so as to explore the potential needs of clients, integrate the Company’s diversified business and products, and provide clients with appropriate financial planning advice.

 Finance 3.0 Digital Transformation Training Program

(1) RPA process automation robot:

Assist the back office in improving the highly repetitive, routine and labor-consuming operating procedures, and streamline and automate the process to save costs and improve operational efficiency.

(2) BA(Business Analyst) Workshop:

In order to promote effective communication between business units and the Information Department, accelerate the information project, BA workshops were organized to develop relevant documentation for system development through practical project studies, and enable business units to understand BA roles positioning and effective operating model, so as to accelerate the clarification of specification, build communication bridges, and build consensus on mission objectives during the cooperation process and accelerate the completion of tasks.

Program for improving management by supervisors
(1) Problem Analysis and Solving Capabilities:

In response to rapid environmental changes and the needs of business development, the supervisor takes the role of guiding and leading the team to achieve their goals. To assist supervisors to effectively undertake tasks, grasp environmental changes, quickly analyze and sort out issues, to suggest solutions, problem analysis and solving, courses are conducted to assist supervisors in familiarizing themselves with systematic thinking, problem analysis and solution skills to enable the team complete the tasks.

(2) Performance Management Seminar:

In order to encourage the continuous growth of employees, the Company organized performance management seminars, and assisted line managers in using meetings to implement performance management mechanism and assist employees in development.

 E-training

(1) The training system has been upgraded to version LMS6.4 and its functions are upgraded to improve the Company’s management and implementation of training programs.
(2) The Company purchases and produces training materials based on job requirements, integrates free resources, and selects various online materials suitable for various roles to encourage employees to learn on their own at any time. This allows learning to be more diverse and spontaneous.
(3) Marketing activities are used to encourage employees to make use of online resources and cultivate habits for continuous learning. The goal is to strengthen motivation for learning and improve their ambitions for improving digital transition.
The Company received the Taiwan Training Quality Assessment Bronze Award from the Labor Development Department, Ministry of Labor from 2016 to 2020, and won silver award for six consecutive years from 2010 to 2016, and was the only enterprise in the securities industry to receive the Silver Award for six consecutive years. The Company won the bronze award from 2018 to 2021. It

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developed human-resource development quality management system according to TTQS in consecutive 12 years for consistency and stability.

B. Retirement System and Implementation Status

To encourage employees’ long-term services and professional development, protect employee rights, and improve work efficiency, the Company has established the Employee Retirement Regulations in accordance with the approval granted in the National Taxation Bureau’s (1989) Cai-Bei-Guo-ShiuShen-1 No.112955 . Letter dated November 12, 1989.
The Company established the Employee Pension Fund Management Committee on October 11, 1994 with the approval of the Department of Labor of the Taipei City Government. After the implementation of the Labor Standards Act in March 1998, the Company established the Supervisory Committee of Labor Retirement Reserve in accordance with the laws. Related organization charters and retirement regulations have been approved by the Department of Labor of the Taipei City Government. The Company appropriates funds at least 2% to the Trust Department of the Bank of Taiwan according to the appropriation ratio calculated by the actuary.
The government implemented the new retirement system in the “Labor Pension Act” in July 2005 to handle employees’ retirement. As of today, the Company has close to 1,400 employees enrolled in the new labor pension system. The Company complies with government policies and appropriates 6% of employees’ salaries to the pension account in the Bureau of Labor Insurance each month.The appropriation amount for 2021 is 74,179 thousand .
Retirement qualifications and principles for payment:
4.1 Voluntary retirement: Employees who met any of the following criteria may apply for voluntary retirement:
- A. Those who have served for more than 15 years and are over 55 years old.
- B. Completed 25 years of service, regardless of age.
- C. Working with the company for at least 10 years and over 60 years old.
4.2 Forced retirement: The Company may request an employee to retire in any of the following situations:
- A. Where the employee attains the age of 65.
- B. Employees who are in dangerous or high labor density work and have reached the age of 55.
- C. Where the employee is unable to perform his/her duty due to a mental or physical disability.
4.3 The calculation of pension:
- A. For employee who joined the Company after July 1, 2005, the pension eligibility follows the Labor Pension Act. During the employment period, the Company shall make monthly contributions based on monthly salary scale set by the Ministry of Labor. A monthly pension of not less than 6% of the salary shall be contributed to the individual pension account established by the Bureau of Labor Insurance.
- B. Employees who joined the Company before July 1, 2005 may choose the following two pension rules for their applicable years of service:
  - (a). Follow the rule of Labor Standards Act: Two bases are given for each full year of service rendered. But for the rest of the period over 15 years, one base is given for each full year of service rendered. The total number of bases shall be no more than 45. The length of service is calculated as half year when it is less than six months and as one year above six months. The basis of salary is based on the average salary of the last six months prior to the employees applying for retirement. Those who choose to apply for this method may opt for the years of service which is after July 1, 2010 according to Labor Pension Act by July 1, 2010.

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(b). According to the provisions of the Labor Pension Act, the Company pays monthly salary based on the monthly salary scale as set by the Ministry of Labor from the date the employees opts for it. A monthly pension of not less than 6% shall be contributed by the individual as set by the Bureau of Labor Insurance.
4.4 An additional 20% on top of the amount calculated according to the preceding subparagraph shall be given to employees who are forced to retire due to mental or physical disability caused while executing their duties.

C. Employee Disputes and Protection of Employee Rights

In accordance with the Labor Standards Act, the company has instituted its own set of work rules and has submitted a copy of these work rules to the Taipei City Government Department of Labor for approval. In addition to notifying all employees via internet of the content of these work rules, we also have posted a copy of these work rules on rules, we also have posted a copy of these work rules on the company’s internal corporate website where employees may view a copy of these rules at any time.
To date, the company has made every effort to maintain a harmonious and fulfilling work environment for all of its employees and, as such, has not suffered any loss or damage resulting from any employee disputes, in the firm’s entire history. And, the company has every reason to believe that this harmonious dynamic will continue.

D. Loss caused by labor dispute in the most recent three years: None.

E. An estimate of losses incurred to date or likely to be incurred in the future, and mitigation measures being or to be taken: None.

F. Certification Details of Employees Whose Jobs are Related to the Release of the Company’s Financial Information

Certification details of employees whose jobs are related to the release of the Company’s financial information are disclosed in the table below. In response to the competent authorities’ requirements for risk management implemented by the risk management unit and the qualifications for operators and internal auditors, the Company’s relevant personnel have also completed the training and obtained relevant qualifications in accordance with the regulations. Currently, four employees in charge of risk verification have obtained the Financial Risk Manager (FRM) Certificate and two employees in charge of auditing have also obtained Certified Financial Service Auditor (CFSA) Certificate.

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Risk Controls Office/5 employees
Certifications and Qualifications Received by Employees
Qualified Ratio (%)
Qualification Exam for Senior Securities Specialist 5 100.0
Qualification Exam for Futures 4 80.0
Certificate of Margin Trading and Short Selling 1 20.0
Qualification Exam for Securities Investment Trust and
3 60.0
Consulting Professional
Qualification Exam for Personal Insurance Representative 1 20.0
Qualification Exam for Non-Life Insurance Representative 1 20.0
Bill Finance Specialist exam 2 40.0
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Finance Department/39 employees
Certifications and Qualifications Received by Employees
Qualified Ratio (%)
Qualification Exam for Senior Securities Specialist 29 74.4
Qualification Exam for Securities Specialist 1 2.6
Qualification Exam for Futures 9 23.1
Certificate of Margin Trading and Short Selling 5 12.8
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Finance Department/39 employees
Certifications and Qualifications Received by Employees
Qualified Ratio (%)
Qualification Exam for Securities Investment Trust and
9 23.1
Consulting Professional
Proficiency Test for Trust Operations Personnel 7 17.9
Qualification Exam for Personal Insurance Representative 7 17.9
Basic Proficiency Test for Bank Lending Personnel 1 2.6
Proficiency Test for Financial Planning Personnel 2 5.1
Basic Proficiency Test for Bank Internal Controls 5 12.8
Qualification Exam for Non-Life Insurance Representative 4 10.3
Professional Capacity of Bonds Specialist 1 2.6
Bill Finance Specialist exam 3 7.7
Proficiency test for corporate basic internal control 1 2.6
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Auditing Office/46 employees
Certifications and Qualifications Received by Employees
Qualified Ratio(%)
Qualification Exam for Senior Securities Specialist 39 84.8
Qualification Exam for Securities Specialist 7 15.2
Qualification Exam for Futures 46 100.0
Certified Public Accountants 1 2.2
Certificate of Margin Trading and Short Selling 30 65.2
Qualification Exam for Securities Investment Trust and
29 63.0
Consulting Professional
Proficiency Test for Trust Operations Personnel 42 91.3
Qualification Exam for Personal Insurance Representative 33 71.7
Qualification Test for Sales Personnel of Structured Products 1 2.2
Basic Proficiency Test for Bank Lending Personnel 4 8.7
Proficiency Test for Financial Planning Personnel 11 23.9
Basic Proficiency Test for Bank Internal Controls 25 54.3
Qualification Exam for Non-Life Insurance Representative 33 71.7
Qualification Exam for Stock Affair Specialist 4 8.7
Professional Capacity of Bonds Specialist 2 4.3
Bill Finance Specialist exam 2 4.3
Qualification Exam for Investment-orientated Insurance
18 39.1
Product Representative
Proficiency test for corporate basic internal control 7 15.2
Wealth management salespersons 38 82.6
Qualification Exam for Securities Investment Trust and
6 13
Consulting Regulations
Trust laws exam 3 6.5
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G. Conduct and Ethics of Employees

The Company has formulated the “Work Rules” and “The Regulations and Declaration” signed with employees for their conduct and ethics. The content is summarized below:

All the Company’s employees shall comply with the following standards and rules in the daily life for the Company’s development and all employees’ welfare:
(1) Environmental sanitation: Maintain sanitation in the surrounding environment and keep documents and supplies tidy.

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(2) Clothing and appearance: Dress in a simple and tidy manner; have a haircut and shave from time to time; barefoot, slippers, flip-flops, and jeans are prohibited; wear in uniform from Monday through Thursday.
(3) Interaction with people: Focus on manners, punctuality, and promise-keeping, respect others, cherish public property, work hard, and be efficient.
(4) Commitment: Be active and responsible at work; do not shirk responsibilities; do not be perfunctory; never put off till tomorrow what may be done today.
(5) Customer first: Receive customers in a cordial and attentive manner; put services first; place emphasis on customers’ rights and interests.
(6) Public property: Ensure proper safekeeping and strengthened management of supplies and equipment.
(7) Profit boosting and cost cutting: Assist in the expansion of business, actively strive for the Company’s interests, reduce and save expenses, as well as eliminate waste.
(8) The Company strictly prohibits gambling, noise, and physical fights.
All of the Company’s employees shall comply with the following service standards and rules for maintaining the Company’s interest.
(1) During employment, employees shall not take on part-time (concurrent) duties other than the work designated by the Company. If it is not in conflict with the Company’s operating interests and will not interfere with the full-time work, employees shall report to their supervisors beforehand. Except for the purpose of business, employees shall not use the Company’s name without permission.
(2) Employees shall not look through documents, correspondence, and books of accounts that are not part of their business and present their business documents to irrelevant parties.
(3) Never leak, transfer, or otherwise the Company’s business or technological secretes, including but not limited to all documents, information, products, or objects or rights with property value, to people.
(4) Employees guarantee that when leaving the Company, all the Company’s information kept related to the work shall be handed over to the unit supervisor, and that Company’s property and relevant documents shall not be taken away.
(5) Employees shall not bring prohibited items and flammable materials into the company; they shall not bring people who do not work at the Company to the Company without permission.
(6) Employees are not allowed to absent the Company’s major meetings without any reason.
(7) The Company’s employees shall report their duties and business to supervisors from the first level all the way up and shall not bypass supervisors in the middle and report to those at higher levels directly, unless it is an emergency or special circumstance.
(8) The Company’s employees shall not take the Company’s property or documents out of the Company without permission, unless with the responsible supervisor’s approval.
(9) The Company’s employees shall not have a loan relationship or guarantee relationship with the Company’s customers.
(10) The Company has prohibited inappropriate lending or loan brokerage among employees.
(11) During employment, employees shall comply with the Company’s assignment of work as well as management and supervision; the Company may adjust the employees’ job duties and workplace location based on business needs in accordance with labor laws.
(12) To protect the Company’s reputation, the Company strictly prohibits employees’ comments that are not verified or may damage the Company’s reputation on any social websites.
To maintain the Company’s corporate culture, the Company’s employees shall comply with the following ethical standards and rules.
(1) When conducting business, employees shall not directly or indirectly offer, promise to offer, request, or accept any improper benefits, including kickbacks, commissions, facilitation fees, or otherwise offer or accept improper benefits to or from customers, agents, contractors, suppliers, public servants, or other stakeholders.

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(2) When directly or indirectly offering a donation to political parties or organizations or individuals participating in political activities, employees shall comply with the Political Donations Act and its own relevant internal operational procedures, and shall not make such donations in exchange for commercial gains or business advantages.
(3) For charitable donations or sponsorships, employees shall comply with relevant laws and regulations and shall commit bribery in disguise.
(4) Employees shall not directly or indirectly offer or accept any unreasonable presents, hospitality or other improper benefits to establish business relationship or influence commercial transactions.
(5) Managers shall not take advantage of their positions in the Company to obtain improper benefits for themselves, their spouses, parents, children or any other person.
I will comply with relevant securities laws; in the case of any violations, I am willing to accept the Company’s punishment.
If personal behavior is detrimental to the social public order, good social customs, or personal misconduct has constituted sexual harassment of other colleagues, with specific evidence proving that it has damaged a business unit’s or colleague’s image or reputation, the Company may terminate the employment relationship without notice.
I will strictly abide by the Company’s regulations on copyright protection, do not use computer programs that are not legally authorized on the Company’s personal computers, and will never reproduce or infringe any programs that are legally authorized on the Company’s personal computers. If violating the above-mentioned regulations, I am willing to accept the Company’s severe punishment and accept all the criminal and civil liability.
Corporate information confidentiality
(1) The ownership, patent rights, and other rights of the business information, research results, or inventions and technologies, which are obtained because of or through my duties, belong to the Company, and I agree to assist the Company in conducting the necessary procedures for obtaining or protecting the rights, whether I am employed.
(2) I agree that the author of the work, which I plan with the fund from the Company or I accomplish through the equipment or information provided by the Company, is the Company, and that the Company owns the copyright.
(3) Never help the Company’s competitors or provide them with relevant materials or information without approval.
(4) Never use Company’s confidential information to threaten the Company as a means of promotion or getting a pay raise.
(5) Never investigate (snoop about) the Company’s confidential information that is not related to the work; never discuss the Company’s confidential information with colleagues.
(6) The salary and bonuses of the Company’s employees are regarded as confidential; I shall not tell other people about my own salary and bonuses and must not inquire about other colleagues’ salaries and bonuses.
(7) If violating the above-mentioned regulations, I am willing to accept the Company’s punishment and take the responsibility for compensation for the resulting damage or losses to the Company.
Regulations on e-mail

Comply with the Company’s relevant regulations on intranet connected to the Internet and e-mail accounts; any violator is willing to accept the Company’s punishment.

H. Internal Legal Compliance and Material Information Management

We have set an “internal material information handling procedures” and assigned the Compliance Office to be in charge of internal major information in order to do coordination and prevent internal

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V. Business Environment

trading. In addition, our HR promotes education advocacy toward board members, managerial officers, and employees each year. In accordance with the “Taiwan Stock Exchange Corporation Procedures for Verification and Disclosure of Material Information of Listed Companies” and with the “Taiwan Stock Exchange Corporation Procedures for Press Conferences Concerning Material Information of Listed Companies”, we have posted all such information on the company’s internal corporate website where employees and managers may view it.

Within the Office of the CEO, we have established a Legal Compliance Department, which is tasked with ensuring that all of the company’s processes and administrative procedures are in compliance with the most recent laws and regulations, that all activities are conducted in accordance with relevant laws and regulations. And in accordance with “Standard Directions for the Content and Procedures of Assessment of Legal Compliance of Securities Firms”, this department is also tasked with conducting regular legal compliance evaluations of each department and each branch office and then conducting legal compliance training specific to their needs.
We have created a legal compliance section on our internal corporate website where we routinely post information on any recent amendments made to relevant laws and regulations. We have also set up a hotline where employees can call to learn more about insider trading, its key principles, definitions, and the potential civil and criminal exposures involved. All of these measures, taken together, provide our employees with appropriate and adequate legal guidance.In order to enhance the legal compliance awareness of all employees, the Company organizes regular/irregular educational training courses every year on the Financial Consumer Protection Law, Principle of Fair Dealing, Anti-Money Laundering and Countering Terrorism Financing Law, Personal Data Protection Law, insider trading and material information related regulations, prevention and control of illegal infringement, labor rights and information security etc.
To comply with Personal Information Protection Act, we established personal data protection system in 2013. Since 2013, the Company has introduced an information management system with the assistance of an external professional consulting team and obtained the BS 10012 information management system certification mark issued by the British Standards Institution. The Company has established a personal data protection committee and an emergency response team for personal data protection. Every year, each department is required to inspect and review all personal data collected, processed, and used, as well as reviewing the operating standards.

VI. Information and Communication Security Management

A. Description of the information and communication security risk management framework, information and communication security policies, specific management plans and resources invested in the information and communication security management.

1. Information and Communication Security Risk Management Structure:

At present, the Company’s organization related to the daily operations or projects of information security is the Information System Department, and the primary responsible department of information security business is the Information Security Section of such department, which is an independent dedicated unit for information security. Appropriate personnel are designated to act as the head of the dedicated information security unit. There is no part-time information responsibility or other businesses assigned to the unit which have conflict of interests with the duties, and appropriate human resources and equipment are deployed or implemented. Other Sections act as assisting units to execute or implement information security.

2. Information and Communication Security Policy:

The Company has established rules and procedures relating to information assets, risk assessment, application development, network and communication security in accordance with the requirements of the Information Security Management System (ISO27001: 2013) to serve as the basis for daily operation and management. After obtaining the certification on August 23, 2013, BSI has conducted continuing

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assessment visit every year and re-assessment every three years. Re-assessment was completed in August 2021.

3. Specific management plans:

The Company, through its management, guides and controls the overall information security activities process of the organization, ensures and maintains effective communication with staff at all levels, follows and maintains effective operation and continuous improvement of “Plan”, “Do”, “Check” and “Act”, and strengthens the information security management system.

4. Resources invested in communication safety management:

In view of the increasing threat of cyberattacks recently, in order to ensure that computer systems have certain level of security protection capabilities, it is necessary to upgrade the protection facilities in each aspect from server room, servers and hosts, user equipment, internet and email, so as to implement control measures in the technical and management aspects and improve and enhance the security protection capabilities of the internet and information systems. In addition to completing the revision and formulation of relevant information security management operating rules, the security updates, patches and version upgrades of relevant equipment will be completed gradually. Furthermore, external units are invited to conduct independent inspections, tests, and assessments to early identify potential information security risks.

5. This year, the information security response concept and respond speed of relevant units were also strengthened through exercises. The information security response strength-ening exercises are as follows:

(1) Preventing malicious e-mail and social engineering practice activity.

(2) The application system backup switch practice activity.

(3) Distributed Denial of Service (DDoS) Attack practice.

(4) 2021 Information and Communication Security Report Practice Plan by the Financial Supervisory Commission and its affiliates.

(5) Information security and health check assessment activity.

(6) Ultimate objective for securities and futures companies tiered information and communication security protection activity.

(7) Mobile application APP testing.

(8) Arranged information security education and training in order to strengthen information security awareness. The training courses include:

A. Information security incidents and sharing of security concepts.
B. Use of personal computer and daily information security operations.
C. Information security skills training and information security concepts.
D. Email security and prevention of social engineering.

It aims to improve the security, reliability, availability of information system and reduce the risks that relevant information security incidents may pose to the Company’s finance.

B. List of losses, possible effects and countermeasures resulting from major information security incidents in the most recent year up to the publication date of this annual report.

One information security incident occurred on November 25, 2021. As a result of the credential stuffing incident, abnormal commission and deal conclusion occurred. 17 orders in 7 accounts in total were affected with actual loss of HKD364,192.91. All losses were borne by the Company without compromising customer interests.

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V. Business Environment

The Company has taken improvement measures in response to the above-mentioned incident, including: strengthening the download and verification mechanism for order placement to avoid order placement by misused accounts. Protection measures to further improve the protection of the Company’s order placement safety is also underway. Additional budgets will be set as appropriate to enhance information technology security to reduce the likelihood and impact of similar incidents in the future.

VII. Material Contracts and Agreements

A. Operating lease contract: For each leased asset with more than NT$5 million of rent per annum as of March 31, 2022

Unit: NT$

Type	Asset	Area (Ping)	Lease Term	Rental	Lessee	Payment Method	Restrictive Covenant
Assets leased by the Company	Nanjing Branch Office	218	2022.01-2026.12	458,000/month	Chen, Ting- Yuan	Half a year	NA

B. Non-operating lease contract: For each leased asset with more than NT$5 million of rent per annum as of March 31, 2022

Unit: NT$

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Area Payment Restrictive
Type Asset Lease Term Rental Lessee
(Ping) Method Covenant
Assets Uni-President
President
leased Asset
Securities 307.06 2019.04-2024.03 522,000/month Monthly NA
to other Management
Building
entities Corporation
Assets
President
leased President Tokyo
Securities 417.14 2019.04-2024.03 709,000/month Monthly NA
to other Corp.
Building
entities
----- End of picture text -----

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VI. Financial Information

I. Five-Year Financial Summary

A. Condensed Balance Sheet

1. Consolidated Condensed Balance Sheet – Based on IFRS

Unit: NT$ thousands

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Year Financial Summary for the last five years (Note1)
2022Q1
(Note1)
Item 2017 2018 2019 2020 2021
----- End of picture text -----

Current Assets		81,561,564	64,915,856	90,081,974	105,321,883	108,685,040	93,495,061
Property and Equipment (Note2)		2,434,389	2,442,370	2,443,964	2,453,712	2,447,128	2,468,351
Intangible Assets		112,096	124,210	129,160	151,765	195,468	203,234
Other Assets		2,203,645	2,898,837	3,099,302	5,784,405	6,360,263	6,693,937
Total Assets		86,311,694	70,381,273	95,754,400	113,711,765	117,687,899	102,860,583
Current	Before distribution	60,800,920	44,636,888	68,821,260	84,087,688	85,708,967	71,051,136
Liabilities	After distribution	62,469,434	45,596,283	70,193,650	86,187,445	Note3	Note3
Non-Current Liabilities		75,812	31,938	167,368	144,595	212,302	189,167
Total	Before distribution	60,876,732	44,668,826	68,988,628	84,232,283	85,921,269	71,240,303
Liabilities	After distribution	62,545,246	45,628,221	70,361,018	86,332,040	Note3	Note3
Equity Attributable to Shareholders of the Parent		25,385,654	25,645,985	26,699,680	29,407,315	31,683,584	31,528,135
Capital Common	Stock	13,904,281	13,904,281	13,723,900	13,998,378	14,558,313	14,558,313
Capital Reserve		142,702	142,702	91,261	91,261	91,261	91,261
Retained	Before distribution	11,397,045	10,979,662	12,362,704	14,483,188	15,724,509	15,160,764
Earnings	After distribution	9,728,531	10,020,267	10,715,836	11,823,496	Note3	Note3
Other Equity Interest		-58,374	619,340	521,815	834,488	1,309,501	1,717,797
Treasury Stocks		-	-	-	-	-	-
Non-controlling Interests		49,308	66,462	66,092	72,167	83,046	92,145
	Before distribution	25,434,962	25,712,447	26,765,772	29,479,482	31,766,630	31,620,280
Total Equity
	After distribution	23,766,448	24,753,052	25,393,382	27,379,725	Note3	Note3

Note 1: Financial information for the years of above-mentioned was audited and certified by CPAs. The financial information for the first quarter of 2022 has been reviewed by CPAs.

Note 2: No asset revaluation has been conducted. Note 3: Distributed earnings from 2021 have yet to be approved by shareholders.

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VI. Financial Information

2. Individual Balance Sheet

Unit: NT$ thousands

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Year Financial Summary for the last five years (Note1)
2022Q1
(Note1)
Item 2017 2018 2019 2020 2021
----- End of picture text -----

Current Assets		66,854,475	48,293,715	71,080,620	79,397,996	83,200,925	69,292,268
Property and Equipment (Note2)		2,260,981	2,269,210	2,270,391	2,270,322	2,271,270	2,291,871
Intangible Assets		62,317	67,004	70,726	94,479	145,690	151,517
Other Assets		6,082,755	6,965,559	7,263,678	9,087,091	9,573,767	9,899,554
Total Assets		75,260,528	57,595,488	80,685,415	90,849,888	95,191,652	81,635,210
Current	Before distribution	49,788,572	31,913,301	53,837,030	61,303,138	63,291,750	49,913,399
Liabilities	After distribution	51,457,086	32,872,696	55,209,420	63,402,895	Note3	Note3
Non-Current Liabilities		86,302	36,202	148,705	139,435	216,318	193,676
Total	Before distribution	49,874,874	31,949,503	53,985,735	61,442,573	63,508,068	50,107,075
Liabilities	After distribution	51,543,388	32,908,898	55,358,125	63,542,330	Note3	Note3
Capital Common	Stock	13,904,281	13,904,281	13,723,900	13,998,378	14,558,313	14,558,313
Capital Reserve		142,702	142,702	91,261	91,261	91,261	91,261
Retained	Before distribution	11,397,045	10,979,662	12,362,704	14,483,188	15,724,509	15,160,764
Earnings	After distribution	9,728,531	10,020,267	10,715,836	11,823,496	Note3	Note3
Other Equity Interest		-58,374	619,340	521,815	834,488	1,309,501	1,717,797
Treasury Stocks		-	-	-	-	-	-
Non-controlling Interests		-	-	-	-	-	-
	Before distribution	25,385,654	25,645,985	26,699,680	29,407,315	31,683,584	31,528,135
Total Equity
	After distribution	23,717,140	24,686,590	25,327,290	27,307,558	Note3	Note3

Note 1: Financial information for the years of above-mentioned was audited and certified by CPAs. The financial information for the first quarter of 2022 has been reviewed by CPAs.

Note 2: No asset revaluation has been conducted.

Note 3: Distributed earnings from 2021 have yet to be approved by shareholders.

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B. Condensed Income Statements

1. Consolidated Condensed Income Statements

Unit: NT$ thousands

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Year Financial Summary for the last five years (Note1)
2022Q1
(Note1)
Item
2017 2018 2019 2020 2021
----- End of picture text -----

Operating Revenue	7,270,066	5,774,276	7,142,397	9,581,272	11,621,619	879,198
Gross Profit	6,284,995	4,644,268	5,896,915	8,526,443	10,527,808	646,965
Operating Income	2,393,918	1,021,143	2,061,802	3,607,110	4,267,554	(507,209)
Non-Operating Income	450,055	415,744	496,006	375,712	401,881	7,912
Income Before Tax	2,843,973	1,436,887	2,557,808	3,982,822	4,669,435	(499,297)
Net Income (Loss) from
Operations of Continued	2,624,657	1,217,633	2,373,835	3,614,596	4,011,373	(562,472)
Segments
Net Income (Loss) from	-	-	-	-	-	-
Discontinued Operations
Net Income (Loss)	2,624,657	1,217,633	2,373,835	3,614,596	4,011,373	(562,472)
Other Comprehensive Income (Income after Tax)	-314,958	145,968	-124,296	475,346	380,465	416,122
Total Comprehensive Income	2,309,699	1,363,601	2,249,539	4,089,942	4,391,838	(146,350)
Net Income Attributable to Shareholders of the Parent	2,618,769	1,210,323	2,368,536	3,607,518	4,007,435	(563,745)
Net Income Attributable to non-controlling Interests	5,888	7,310	5,299	7,078	3,938	1,273
Comprehensive Income
Attributable to Shareholders of	2,304,724	1,355,594	2,244,912	4,080,025	4,376,026	(155,449)
the Parent
Comprehensive income
attributable to non-controlling	4,975	8,007	4,627	9,917	15,812	9,099
interests
Earnings Per Share (Note2)	1.78	0.82	1.63	2.48	2.75	(0.39)

Note 1: Financial information for the years of above-mentioned was audited and certified by CPAs. The financial information for the first quarter of 2022 has been reviewed by CPAs.

Note 2: Earnings per share is calculated based on the number of shares that were adjusted retrospectively. The unit is NTD.

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VI. Financial Information

2. Individual Condensed Income Statements

Unit: NT$ thousands

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Year Financial Summary for the last five years (Note1)
2022Q1
(Note1)
Item
2017 2018 2019 2020 2021
----- End of picture text -----

Operating Revenue	6,359,985	4,687,890	6,229,917	8,472,984	10,578,004	626,808
Gross Profit	5,715,963	3,931,716	5,313,631	7,832,892	9,905,317	495,649
Operating Income	2,333,898	880,341	2,024,947	3,522,255	4,262,675	(512,778)
Non-Operating Income	474,303	505,305	489,434	404,341	370,104	1,552
Income Before Tax	2,808,201	1,385,646	2,514,381	3,926,596	4,632,779	(511,226)
Net Income (Loss) from
Operations of Continued	2,618,769	1,210,323	2,368,536	3,607,518	4,007,435	(563,745)
Segments
Net Income (Loss) from	-	-	-	-	-	-
Discontinued Operations
Net Income (Loss)	2,618,769	1,210,323	2,368,536	3,607,518	4,007,435	(563,745)
Other Comprehensive Income (Income after Tax)	-314,045	145,271	-123,624	472,507	368,591	408,296
Total Comprehensive Income	2,304,724	1,355,594	2,244,912	4,080,025	4,376,026	(155,449)
Earnings Per Share (Note2)	1.78	0.82	1.63	2.48	2.75.	(0.39)

Note 1: Financial information for the years of above-mentioned was audited and certified by CPAs. The financial information for the first quarter of 2022 has been reviewed by CPAs.

Note 2: Earnings per share is calculated based on the number of shares that were adjusted retrospectively. The unit is NTD.

C. Auditors’ Opinions from 2017 to 2021

Year	CPA	Audit Opinion
2017	Hsiao, Chin-Mu / Chang, Ming-Hui	Unqualified Opinion
2018	Lin, Se-Kai / Hsiao, Chin-Mu
2019	Lin, Se-Kai / Hsiao, Chin-Mu
2020	Lin, Se-Kai / Lo, Sen-Jiao
2021	Lin, Se-Kai / Lo, Sen-Jiao

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II. Financial Analysis for the Past Five Years

1. Consolidated Financial Analysis for the Past Five Years

Year		Financial Summary for the last five years (Note1)	Financial Summary for the last five years (Note1)	Financial Summary for the last five years (Note1)	Financial Summary for the last five years (Note1)	Financial Summary for the last five years (Note1)
Item		2017	2018	2019	2020	2021
Financial Structure (%) Debt Ratio Ratio of Long-term Capital to property and equipment	70.53 63.42 72.05 74.08 73.01 69.26 1044.82 1052.77 1095.18 1201.42 1298.12 1281.03
Solvency (%) Current Ratio Quick Ratio	134.15 145.43 130.89 125.25 126.81 131.59 134.09 145.39 130.86 125.22 126.78 131.54
Profitability Analysis Return on Total Assets (%) Return on Stockholders’ Equity (%) Pre-tax Income to Paid-in Capital (%) Profit Ratio (%) Earnings Per Share (NT$) (Note2)	3.43 1.98 3.37 3.66 3.54 -0.50% 10.81 4.76 9.05 12.85 13.10 -1.77% 20.45 10.33 18.64 28.45 32.07 -3.43% 36.10 21.09 33.24 37.73 34.52 -63.98% 1.85 0.85 1.69 2.58 2.75 -0.39
Cash Flow (%) Cash Flow Ratio Cash Flow Adequacy Ratio Cash Reinvestment Ratio	5.92 24.26 - 8.87 2.67 3.28 214.36 404.72 409.63 459.61 356.40 336.99 13.84 35.71 - 20.81 0.59 7.59
Other Ratio (%) Debit to Equity Ratio Ratio of Property and Equipment to Total Asset Total Underwriting to Quick Assets Ratio Total Margin Loan Balance to Equity Ratio Total Short Sales Amount to Equity Ratio	239.34 173.72 257.75 285.73 270.48 225.30 3.48 4.3 3.18 2.72 2.67 3.09 0.61 1.32 0.88 0.73 1.19 0.13 44.88 31.19 37.45 41.55 57.75 53.33 8.64 7.81 7.06 6.14 4.91 2.57
Analysis of financial ratio differences for the last two years (for variations above 20%) (1) Cashflow ratio: Decreased comparing to 2020 mainly due to the decrease of net cash inflow from operating activities. (2) Cash flow adequacy ratio: Mainly due to the increase in cash dividends distributed in 2021 as compared to that in 2020. (3) Cash reinvestment ratio: Mainly due to the cash outflow after deducting cash dividend payout from net cash inflow from operating activities. (4) Total amount of commitment underwriting to quick assets ratio: This ratio increased mainly due to an increase in underwriting amount in 2021. (5) Margin purchase to net worth ratio: mainly due to the significant increase of financing amount in 2021 as compared to that in 2020. (6) Short selling to net worth ratio: mainly due to the decrease in value of short selling in 2021.

Note 1: Financial information for the years of above-mentioned was audited and certified by CPAs. The financial information for the first quarter of 2022 has been reviewed by CPAs.

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VI. Financial Information

Note 2: Earnings per share is calculated based on the number of shares that were adjusted retrospectively. The unit is NTD. Note 3: Equations for analysis items:

(1) Financial structure
i. Liability to total assets ratio = Total liabilities/total assets
ii. Ratio of long-term capital to property, plant and equipment = (total equity + non-current liabilities) /net worth of property, plant and equipment
(2) Solvency
i. Current ratio = Current assets / Current liabilities
ii. Quick ratio = (Current assets - inventory - prepaid expenses) / Current liabilities
(3) Profitability
i. Return on assets = [after-tax income (loss) + interest expense × (1- tax rate)]/average total assets
ii. Return on equity = net income / average total equity
iii. Profit margin before tax = net income / net sales
iv. Earnings per share = (profit and loss attributable to owners of the parent – dividends on preferred shares) / weighted average number of issued shares
(4) Cash flow
i. Cash flow ratio = Net cash flow from operating activities / current liabilities
ii. Net cash flow adequacy ratio = Net cash flow from operating activities for the most recent five years / (capital expenditures + inventory increase + cash dividend) for the most recent five years
iii. Cash flow reinvestment ratio = (Net cash flow from operating activities – cash dividend) / (gross property, plant and equipment value + long-term investment + other non-current assets + working capital)
(5) Other ratio
i. Debt to equity ratio = total liabilities/ shareholders’ equity
ii. Property and equipment to total assets ratio = net fixed assets / total assets
iii. Total underwriting to quick asset ratio = total underwriting / (current assets - prepayments)
iv. Total margin loan balance to equity ratio = total margin loan balance / shareholders’ equity
v. Total short sales amount to equity ratio = total short sales amount / shareholders’ equity

2. Individual Financial Analysis for the Past Five Years

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Year Financial Summary for the last five years (Note1)
2022Q1
(Note 1)
Item 2017 2018 2019 2020 2021
Debt Ratio 66.27 55.47 66.91 67.63 66.72 61.38
Financial
Structure
Ratio of Long-term Capital to
(%) 1122.77 1130.17 1175.99 1295.29 1394.97 1375.65
property and equipment
Current Ratio 134.28 151.33 132.03 129.52 131.46 138.82
Solvency (%)
Quick Ratio 134.23 151.28 131.99 129.48 131.42 138.76
Return on Total Assets (%) 3.99 2.3 4.01 4.44 4.38 -0.62
Return on Stockholders’ Equity
10.81 4.74 9.05 12.86 13.12 -1.78
(%)
Profitability
Pre-tax Income to Paid-in Capital
Analysis 20.20 9.97 18.32 28.05 31.82 -3.51
(%)
Profit Ratio (%) 41.18 25.82 38.02 42.58 37.88 -89.94
Earnings Per Share (NT$) (Note2) 1.85 0.85 1.69 2.58 2.75 -0.39
Cash Flow Ratio 6.27 33.44 - 12.60 1.17 4.80
Cash Flow
Cash Flow Adequacy Ratio 183.46 398.65 398.27 465.96 335.38 323.35
(%)
Cash Reinvestment Ratio 12.08 34.72 - 21.46 - 7.57
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Debit to Equity Ratio 196.47 124.58 202.2 208.94	200.44	158.93
Ratio of Property and Equipment to Total Asset 3.61 4.74 3.40 3.07	2.97	3.51
Other Ratio (%) Total Underwriting to Quick Assets Ratio 0.74 1.77 1.12 0.97	1.55	0.18
Total Margin Loan Balance to Equity Ratio 44.97 31.27 37.54 41.65	57.9	53.48
Total Short Sales Amount to Equity Ratio 8.66 7.83 7.07 6.15	4.92	2.58
Analysis of financial ratio differences for the last two years (for variations above 20%)
(1) Cashflow ratio: Decreased comparing to 2020 mainly due to the decrease of net cash inflow from operating
activities.
(2) Cash flow adequacy ratio: Mainly due to the increase in cash dividends distributed in 2021 as	compared to that in
2020.
(3) Cash reinvestment ratio: Mainly due to the cash outflow after deducting cash dividend payout	from net cash	inflow
from operating activities.
(4) Total amount of commitment underwriting to quick assets ratio: This ratio increased mainly due to an increase
in underwriting amount in 2021.
(5) Margin purchase to net worth ratio: mainly due to the significant increase of financing amount in 2021 as
compared to that in 2020.
(6) Short selling to net worth ratio: mainly due to the decrease in value of short selling in 2021.

Note 1: Financial information for the years of above-mentioned was audited and certified by CPAs. The financial information for the first quarter of 2022 has been reviewed by CPAs.

Note 2: Earnings per share is calculated based on the number of shares that were adjusted retrospectively. The unit is NTD.

Note 3: Equations for analysis items:

(1) Financial structure
i. Liability to total assets ratio = Total liabilities/total assets
ii. Ratio of long-term capital to property, plant and equipment = (total equity + non-current liabilities) /net worth of property, plant and equipment
(2) Solvency
i. Current ratio = Current assets / Current liabilities
ii. Quick ratio = (Current assets - inventory - prepaid expenses) / Current liabilities
(3) Profitability
i. Return on assets = [after-tax income (loss) + interest expense × (1- tax rate)]/average total assets
ii. Return on equity = net income / average total equity
iii. Profit margin before tax = net income / net sales
iv. Earnings per share = (profit and loss attributable to owners of the parent – dividends on preferred shares) / weighted average number of issued shares
(4) Cash flow
i. Cash flow ratio = Net cash flow from operating activities / current liabilities
ii. Net cash flow adequacy ratio = Net cash flow from operating activities for the most recent five years / (capital expenditures + inventory increase + cash dividend) for the most recent five years
iii. Cash flow reinvestment ratio = (Net cash flow from operating activities – cash dividend) / (gross property, plant and equipment value + long-term investment + other non-current assets + working capital)

(5) Other ratio

i. Debt to equity ratio = total liabilities/ shareholders’ equity
ii. Property and equipment to total assets ratio = net fixed assets / total assets
iii. Total underwriting to quick asset ratio = total underwriting / (current assets - prepayments)
iv. Total margin loan balance to equity ratio = total margin loan balance / shareholders’ equity
v. Total short sales amount to equity ratio = total short sales amount / shareholders’ equity

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VI. Financial Information

III. Audit Committee’s Review Report on the Company’s 2021 Financial Statement

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IV. Financial Difficulties Experienced by the Company or Its Affiliates in the Most Recent Year or up to the Date of Publication of the Report that will Affect the Company’s Financial Situation: None.

V. Status of the Achievement in Financial Forecasts for the Latest Two Years: Not Applicable.

VI. Methods and Assumptions used for Evaluating Fair Value of Financial Instruments

A. The fair value of short-term financial instruments is evaluated at their book value since the effect of discounting is not significant. This method is applied to cash and cash equivalents, bonds purchased under resale agreements, margin loans receivable, refinancing guaranty deposits, receivable from refinance guaranty, receivables from security lending, security lending deposits, restricted assets, operation deposits, clearing and settlement fund, short-term loans, commercial paper payable, bonds sold under repurchase agreements, deposits on short sales, guarantee deposit received on borrowed securities, short sale proceeds payable, notes and accounts payable, collection for others, other payables (excluding income tax payable) and deposits received.
B. Financial instruments at fair value through profit and loss, when they are traded in active markets, their fair value are based on their quoted prices. If there are no quoted market prices which can be used as benchmarks, evaluating methods will be adopted to measure the fair value. Estimates and assumptions used in evaluating methods adopted by the Group are consistent with those adopted by market participants for financial instrument pricing.

Methods of evaluating fair value of financial instruments are as follows:

Equity Securities: Fair value refers to the closing prices as at the balance sheet. For open-ended funds, fair value refers to the net asset value of the fund as at the balance sheet.
Bonds: Government bonds and corporate bonds are based on the market prices derived from average bond yields published by the Taipei Exchange; foreign bonds are based on the transaction prices from Bloomberg.
Interest rate instruments: For IRS, interest rate quotations of CP with same durations in the same markets in the representative quotation system (e.g. Reuters) are used as reference interest rates. In addition, average bid/offer interest rates at certain point of time daily are used as interest rate parameters. Along with other parameters, they are then used in the valuation models to calculate fair value.
Futures: Closing prices of respective futures exchanges on that day.
Options: Closing prices of the exchanges of the options on that day.
Warrants: Closing prices of the instruments in the listed market.
Convertible Bond Asset Swap: Closing prices of the CB and of underlying shares in the listed exchanges are used as parameters along with others in the valuation model to calculate the fair value.
Structured instruments: Closing prices of underlying instruments or bond yields published by the Taipei Exchange are used as parameters along with others in the valuation models to calculate the fair value.
Other derivatives: For listed derivatives, fair value is based on the quoted prices. For unlisted ones, fair value is based on average bid or offer prices from quotation platforms or other quoted prices.
C. For financial assets at fair value through other comprehensive income, if there are quoted prices in active markets, they are used as their fair value. If there are no quoted prices, a valuation methods are adopted to measure the fair value.

VII. Hedge Accounting Applied to Financial Instruments: Not applicable.

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VII. Financial Status, Operating Results and Risk Management

I. Financial Status

Unit: NT$ thousands

Year Item	Fluctuation	Fluctuation
	Amount	Variance (%)
Current Assets 108,685,040 105,321,883 3,363,157 3.19% Non-Current Assets 9,002,859 8,389,882 612,977 7.31%
Total Assets 117,687,899 113,711,765 3,976,134 3.50%
Current Liabilities 85,708,967 84,087,688 1,621,279 1.93% Non-Current Liabilities 212,302 144,595 67,707 46.83%
Total Liabilities 85,921,269 84,232,283 1,688,986 2.01%
Capital Stock 14,558,313 13,998,378 559,935 4.00% Capital Surplus 91,261 91,261 0 0% Retained Earnings 15,724,509 14,483,188 1,241,321 8.57% Other Equity 1,309,501 834,488 475,013 56.92% Attributable to Parent’s Ownership Interest 31,683,584 29,407,315 2,276,269 7.74% Non-Controlling Interests 83,046 72,167 10,879 15.07%
Total Equity 31,766,630 29,479,482 2,287,148 7.76%
Note: Financial information for the years of above-mentioned (based on IFRS) was audited and certifed by CPAs. Main reasons for material changes in assets, liabilities and shareholders' equity items within the last two years (changes over 20% between the frst and second periods, and the change amount reaches NT$ 10 million), its efects, and future response plans: (1) Non-Current Liabilities: The increase was mainly due to the increase in net defned beneft liabilities, which had no material impact to the Company. (2) Other Equity: Mainly due to the increase in other comprehensive income of subsidiaries accounted for by equity method recognized as compared to the year of 2020, which had no signifcant impact to the Company.

II. Analysis of Operating Results

Unit: NT$ thousands

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Year 2021 2020
Item (Note) (Note) Amount Variance (%)
Operating Revenue 11,621,619 9,581,272 2,040,347 21.30%
Operating Expenses 7,354,065 5,974,162 1,379,903 23.10%
Operating Income 4,267,554 3,607,110 660,444 18.31%
Non-Operating Income 401,881 375,712 26,169 6.97%
Income before Tax 4,669,435 3,982,822 686,613 17.24%
Income Tax Expense 658,062 368,226 289,836 78.71%
Net Income 4,011,373 3,614,596 396,777 10.98%
Other Comprehensive Income
380,465 475,346 -94,881 (19.96%)
(after Tax)
Total Comprehensive Income 4,391,838 4,089,942 301,896 7.38%
Net Income Attributable to
Shareholders of the Parent 4,007,435 3,607,518 399,917 11.09%
Non-controlling Interests 3,938 7,078 -3,140 (44.36%)
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Year 2021 2020
Item (Note) (Note) Amount Variance (%)
Comprehensive Income
Attributable to
Shareholders of the Parent 4,376,026 4,080,025 296,001 7.25%
Non-controlling Interests 15,812 9,917 5,895 59.44%
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Note: Financial information for the years of above-mentioned (based on IFRS) was audited and certified by CPAs.

Explanation to major variations in the last two years (changes over 20%):

Operating revenue: Due to the increase in net profit from operating securities and brokerage handling fee revenue in 2021.
Operating Expenses:The increase was due to the increase in employee benefit expenses and other operating expenses in 2021.
Income tax expense: The increase in income tax expenses was due to the increase in profit in 2021.
Net profit attributable to non-controlling interests: Profit of investment with ownership less than 100% decreased in 2021 as compared to the previous period, corresponding to decrease in non-controlling interests.
Total comprehensive income attributable to non-controlling interests: Other comprehensive income of subsidiaries accounted for using the equity method recognized in 2021 increased as compared to that in 2020, with a corresponding increase in non-controlling interests.

III. Analysis of Cash Flow

A. Cash Flow Analysis for the Current Year

(1) Operating activities: Net cash inflow from operating activities was NT$2,289,188 thousand, representing a decrease of net inflow of NT$5,173,272 thousand as compared to previous year, which was mainly due to the decrease in net cash inflow from operating activities as a result of the significant decrease in bond repurchase agreement liabilities as compared to the previous year.
(2) Investing activities: Net cash outflow from investing activities was NT$326,995 thousand, representing a decrease of NT$2,387,039 thousand as compared to previous year, mainly due to the decrease in obtaining investment accounted for by equity method which resulted in decrease in net cash outflow from investing activities.
(3) Financing activities: Net cash outlow from financing activities was NT$1,314,352 thousand, representing a decrease of NT$4,765,255 thousand as compared to previous year, mainly due to the increase in commercial papers payable and short-term loans which resulted in decrease in net cash outflow from financing activities.

B. Remedy for Cash Deficit and Liquidity Analysis

The Company has maintained a good credit relationship with banks for a long time and maintained mid-and short-term credit lines sufficient to meet the Company’s funding needs.

Year Item	2020	2021	Variance (%)
Cash Flow Ratio (%)	8.87	2.67	-69.90%
Cash Flow Adequacy Ratio (%)	459.61	356.40	-22.46%
Cash Reinvestment Ratio (%)	20.81	0.59	-97.16%
Explanation to major variations: Cash Flow Ratio: The net cash infow from operating activities in 2021 decreased signifcantly from the previous year, resulting in a decrease in the cash fow ratio from 2020. Cash Reinvestment Ratio: The net cash infow from operating activities in 2021 decreased signifcantly from the previous year, resulting in a decrease in the cash reinvestment ratio from 2020.

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C. Cash Flow Analysis for the Coming Year

C. Cash Flow Analysis for the Coming Year	C. Cash Flow Analysis for the Coming Year	C. Cash Flow Analysis for the Coming Year	C. Cash Flow Analysis for the Coming Year	C. Cash Flow Analysis for the Coming Year	C. Cash Flow Analysis for the Coming Year
Unit: NT$ thousands
Estimated Cash and Cash Equivalents	Estimated Net Cash Flow from Operating	Estimated Cash	Cash Surplus (Defcit)	Leverage of Cash Surplus (Defcit)
, Beginning of Year (1)	Activities (2)	Outfow (Infow) (3)	(1)+(2)-(3)	Investment Plans	Financing Plans
5,757,012	2,130,407	2,586,750	5,300,669	-	-

IV. Effects of Major Capital Expenditures in the Most Recent Fiscal Year on Financial Operations: Not Applicable.

V. Long-term Investment Policy

In 2021, the company’s domestic reinvestment operations generated healthy profits. Each subsidiary’s operations will still be subject to strict risk control with timely stop-loss and stop-gain orders, so as to reduce risk and maintain steady development.

As for our present direct investment policy, we consider all areas of business currently permitted by Taiwan’s regulators and look for effective cross-selling strategies and other possible synergies, with the overall aim of best leveraging all of the company’s resources. Looking to the coming year, we expect regulators to again open up many new areas of business. We will expand into these new business areas, develop and promote new financial products. The Company will follow the footsteps of open policy, actively develop and promote various financial products to develop international financing and investment business as well as all kinds of businesses in the future Greater China market. In addition, in order to simplify the investment structure and enhance the overall capital utilization efficiency, President Securities completed the liquidation of President Securities (BVI) Limited in September 2021, with a focus on the investment business in mainland China. Going forward, the Company expects to earn considerable profit from the vast China securities market after the joint venture Jin Yuan President Securities Corporation Limited has completed implementation of various businesses and can operate in scale.

The profitability of each investment in 2021 is detailed in VIII. Other Disclosures-Operational Highlights of Affiliated Companies.

VI. Analysis of Risk Management

A. The Company’s risk management policies, organizational structure, measurement standards, as well as the impact of various risks and response measures

1. Risk Management Policies

(1) In order to ensure that we have a solid an effective risk management system in place, our system has been developed so as to encompass all of our business areas. Then, with appropriate risk tolerance levels in place, create value for the company, and achieve our return on asset targets.
(2) By constructing risk controls for each individual business area, we are able to achieve a measured approach to risk management. Accordingly, each department is assigned risk parameters based on its respective responsibilities, thereby achieving layered yet comprehensive risk management.
(3) The company’s risk management measures take into account the following forms of risk, market risk, credit risk, liquidity risk, operational risk, legal risk, and model risk.

2. Related Risk Management System Architecture

(1) Board of Directors: Audits the company’s risk management policy, supervises sales business strategies, approves all business proposals and trading permissions, and is ultimately responsible for risk management.
(2) Risk Management Committee: Established by the Board of Directors tasked with integrating all risk management operations, with supervising and assisting all the various risk management and related operations. The committee is also tasked with setting the various risk authorities, limits, and targets, for a centralized supervision of the status of all of the company’s risk management efforts.President Office:

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Supervises the daily implementation of all of the company’s risk management operations and authorizes any exceptions to the risk management protocols.

(3) Assets & Liabilities Management Committee: Controls the company’s overall asset structure, sets limits for different businesses, collects and analyzes domestic and international interest rates, exchange rates, and economic changes.
(4) Risk Control Office: Is responsible for the drafting of risk policies and regulations, for monitoring market and credit risks, for monitoring liquidity risks, for compiling data on operational risk control and management, for constructing and maintaining the risk management system, for implementation of risk management systems and for ensuring company-wide regulatory compliance.
(5) Auditing Office: Audits operations risk controls, audits the standards for risk controls systems, puts in place internal auditing controls, and implements daily check routines.
(6) Compliance Division: Implements legal risk controls and ensures that all businesses and risk management operations are in compliance with relevant laws and regulations. Compliance Division concurrently is responsible for anti-money laundering and counter-terrorist financing, developing relevant regulations and systems, monitoring internal control and transactions, supervising the implementation by business units, holding training sessions, and reporting cases suspicious of money laundering.
(7) Finance Department: Monitors capital adequacy rates and liquidity risk, and analyzes the company’s asset/liability structure and other key financial ratios.
(8) Business units: Based on the company’s risk management policies and regulations sets risk management guidelines for various businesses, and produces a report on abnormal risk items for the Risk Control Office.
(9) Settlement & Clearing Department: Implementation of risk control and management for settlement, clearing, and short-sale business operations. Implementation of risk management and business department risk management for transactions.

3. Risk Evaluation Standards

The company has set risk management principles. In order to ensure that all of our organizations businesses adhere to our operating policies, operating goals, and capital levels, we must set suitability evaluation policies that can react to changes in our business and in the market:

Market Risk Evaluation
(1) We use RiskMetrics market risk management system to manage our company’s exposure to market risk. In addition to producing daily risk value tables, we perform simulation analysis and historical analysis to supplement missing risk values.
(2) We evaluate the completeness of the evaluation models on different business areas, and evaluate the assumptions, parameters, and data for various product models, and then test if the models for the various products are reasonable.
(3) We evaluate the effectiveness of risk control models, and regularly perform Back Testing to ensure the reasonableness of the models used.
Credit Risk Evaluation
(1) Our company undergoes credit rating evaluations from Moody’s, Standard & Poor’s, Fitch, Taiwan Ratings Corp., and Taiwan Corporate Credit Risk Index, TCRI)
(2) Trading counter-partner credit risk: We assess our company’s maximum exposure in the event that the counterparty defaults, and use maximum exposure limits set by the board of directors in determining the credit risk of a trading counterparty.
(3) Issuer’s Credit Risk: We use KMV models to perform an internal evaluation, and combine that with financial data and stock price data, to calculate a probability of default. Based on these measurements, we

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then develop an internal evaluation, Z-Score model, to control the external credit risk gaps from issuers and augment.

Operational Risk Evaluation
(1) Operational risks refer to risks of damage caused by internal operations, inappropriate actions or errors of personnel or systems, or external incidents. The definition includes legal risks but does not include risks in strategies and reputation.
(2) We create operations risk policies handbooks that encompass each level of operations.
(3) Ensure the appropriate measurement, disclosure, and control of the operating quality based on risk assessment reports and auditing reports.

4. Risk Factors and Corresponding Responses

(1) Management Crisis Risk: Management crisis risk refers to significant market changes, a lack of access to capital, or significant losses from direct investments, which affect a company’s operations and cause losses.

Response: We have implemented a “Management Crisis Response Policy” that clearly lays out what steps should be followed in the event of a serious crisis so as to ensure normal operation of the company.

(2) Market risk: Market risk refers to dramatic changes in pricing or volatility in interest rates, equities, or foreign exchange rate that can result in serious losses to open positions.

Response: We will attempt to lessen the impact of such market risks through prudent business analysis, product analysis, and process analysis, so as to clearly identify sources of market risk. Based on this, we then set effective management controls; we monitor investment position risk levels, risk structure, and risk changes to ensure that they are all in line with our forecasts.

(3) Credit risk: Credit risk refers to the exposure for underwriters for the terms and conditions of the securities that underwrite and for losses that may result from a counterparty being unable to fulfill its obligations to the security.

Response: In an effort to shield ourselves from potential credit risk, we conduct extensive credit risk evaluations prior to a deal being executed and then conduct repeated evaluations after the deal has been executed. Based on these evaluations and a maximum credit exposure scenario for the counterparty in question, we set credit risk limits for that counterparty. In evaluating the risk to the underwriter for debtrelated securities, we look not only at the TCRI rating, but also at default rates based on KMV models.

(4) Operational risk: Operational risk refers to the risk created when internal processes, employees, or systems are inappropriate or cause errors, or the risks caused by external factors. This type of risk is related to legal risks but not strategic risk or credit risk.

Response: In order to reduce the probability of such operation risk occurring, we have created an operating manual that addresses every level of our operations, we perform regular audits of every business segment, as well as every work flow, every legal risk point, and every risk control point. Finally, we compile an audited risk report that helps us to ensure that our operating quality is properly balanced, controlled, and disclosed.

(5) Legal/Regulatory risk: Refers risk related to non-compliance with laws and regulations governing our investment strategies and our business operations, and any resulting corrective orders or penalties from relevant authorities, or any civil or criminal actions taken against us. It also refers to risk related to our inability to perform our obligations under agreements that we have entered into with other parties.

Response: In order to reduce our exposure to legal/regulatory risks, we have created a Compliance Division and Legal Matters Department.

Compliance Division ensures that all businesses and risk management operations are in compliance with relevant laws and regulations.
Legal Matters Department implements legal risk controls.

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(6) Liquidity risk: Liquidity risk refers to position liquidity risks and capital liquidity risks. Sometimes losses can be suffered as a result of illiquid markets that make it difficult to open or close a position at normal market prices requiring that a position be either bought at a premium or sold at a discount. Capital liquidity risks result when positions are increased beyond planned levels, leaving the company with insufficient funds to meet settlement requirements for a position.

Response: In an effort to better manage liquidity risks, we have created centralized risk management standards that take into consideration all departments and that set position limits for each department. We also have a team that performs daily forecasts of capital requirements based on the needs of all company guarantees and service loans, and then monitors daily capital adjustments accordingly. We also produce a monthly “Capital Liquidity Risk Simulation Analysis Table” that analyzes multiple scenarios, forecasts the potential liquidity risks for those scenarios, and estimates the capital levels that each such scenario would require.

(7) Model risk: Model risk refers to potential situations where market values and other variables are beyond normal and predictable conditions and therefore exceed the ability of the model to handle.

Response: We effectively maintain and manage our models with particular emphasis on financial product risk management. We have created a set of “Model Use Management Procedures” that clearly spell out procedures for developing models, for validating models, for managing variables, and for discontinuing the use of problem models.

B. An Evaluation of Key Risks

1. Effects of recent interest rates, foreign exchange rate fluctuations, and inflation concerns on our company and our strategies for dealing with these concerns.

(1) Interest rate: Changes in interest rates have a direct impact on the income we derive from our fixed income-related businesses. In addition to conducting our own thorough research on domestic and foreign interest rate trends, we utilize various interest rate derivative tools as well a risk control system that manages our interest rate-related risks, that creates an effective interest rate hedging system for our fixed income-related businesses. Changes in interest rates also affect our company’s financing costs. Going forward, we intend to utilize interest rate hedging and other capital raising avenues as ways to control our company’s financing costs.

The effects and countermeasures:

i. Bond and Interest Derivative Product Business: The amount of our company’s major interest products At March 31, 2022, and the likely loss of NT$71,048 thousand due to the 1% interest rate change (as show in the following table). Unit: NT$ thousands

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Profit/loss based on
Item Amount 1% Interest rate
change
Government bond 1,044,969 -5,572
Corporate bond 496,920 -6,392
Bank debentures 296,112 -2,855
International bond 1,405,719 -30,298
Foreign bond 4,095,089 -25,931
Total 7,338,809 -71,048
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Countermeasures: Our Company has risk management rules and operational procedures on government bond, corporate bond, bank debentures, foreign/international bond. Our company has put the interest risk under good control by pre-purchase assessment and risk control afterward.

ii. Borrowing: The main risk of borrowing is the fluctuation of interest rate. Our company can adjust methods, conditions and terms of borrowing according to the likely interest changing trend. We can also avert risks through the product of interest exchange etc. Our total debt amount of short-term

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borrowing and payable short-term bill totals NT$7.052 billion on the end of 2022 Q1. They are both borrowing with interest rate risks. With every 1bp change in market interest rate, our company has to pay NT$705.2 thousand more interest every year.

Countermeasures: Looking at a potential rise in interest rates, we will keep a close watch on the markets and on business demands and will make adjustments to our positions accordingly.In March 2022, the Central Bank’s joint meeting of directors and supervisors resolved to raise the interest rate as the major economies of the world . Although the global economic outlook is subject to many uncertainties, which may affect the domestic economic growth momentum. However, in view of the recent surge in global commodity prices such as energy due to the Russia-Ukraine conflict, the domestic imported inflation pressure is high and CPI annual growth rate is higher than 2% for several consecutive months, the Central Bank’s Board of Directors believes that by raising the policy interest rate, it will help to contain the expected domestic inflation, maintain the policy objective of stable commodity prices and assist the steady development of the overall economy and finance.Three rates, the Central Bank’s rediscount rate, the rate on facilities with collateral, and rate on facilities without collateral were increased by 0.25%, from 1.125%, 1.5%, and 3.375% to 1.375%, 1.75%, and 3.625%, respectively.

It is expected that interest rates will remain stable over the coming year and that our Company’s risks related to the changes of the rates will remain low.

(2) Exchange rate: The Company’s principal business targets and place of business are domestic; hence the impact of currency fluctuations is minimal. Potential foreign exchange risks include not just that arising from the par of exchange for foreign currency assets, but also that from foreign currency investment with respect to foreign reinvested or reinvested companies (when future earnings are repatriated or disposed). Whenever the company invests in foreign currency assets, FX swaps will always be in place to avoid foreign exchange risk. Since its overseas subsidiaries are running perpetual operations, the impact of exchange rate movements on long-term equity investments is limited to the changes to book value and does not affect profits and losses.

At March 31, 2022, the company’s main exchange rate product positions, and 1% exchange rates fluctuation may result in a loss of NT$47,081 thousand (as show in the following table).

Unit: NT$ thousands

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Loss resulted by 1% exchange
Item Position rates fluctuation
Foreign Stock 35,898 -4,810
International Bond 1,405,719 -13,966
Foreign Bond 4,095,089 -28,305
Total 5,536,706 -47,081
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Countermeasures: Our Company’s transactions of foreign stock, international bond, and foreign bond have risk management and standard operating process. The business above was lower the risk of exchange rate by trading foreign exchange swap.

(3) Inflation: The CPI growth rate in January and February of 2022 was +2.60%, which had no meaningful effect on operations or on profits.

2. Recent High-Risk or High-Leverage Investments, Loans to Third Parties, Pledges Given for Third Parties, Derivative Products Trading Policy and Profitability and Losses, Reasons for Losses and Strategies for Correcting Such Losses Going Forward.

(1) In 2022Q1, we did not engage in any high-risk or highly-leveraged investments, did not provide any loans to third parties, and did not provide any pledge for any third parties.
(2) We only trade those derivative products which have been approved by the relevant authorities and which are permitted by our company’s Articles of Incorporation. We have also created and followed a “Code of

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Over-the-Counter Trading of Derivative Financial Products” in an effort to further reduce our exposure to related risk.

3. Future Development Plans and Expected R&D Investments.

To assist with our development of ever-better products and trading strategies, we have assembled a professional financial engineering team, which brings together experts from finance, statistics, mathematics, and information technology, to create trading and valuation software and hardware resources. Our annual spending on human resources and R&D in this area is in the millions of dollars every year. Please see Chapter 5 for more information on the status of our operations and on our R&D efforts.

4. Effects of Significant Policy and Legal Changes both in Taiwan and Abroad and Measure for Dealing with These Issues.

We are constantly on watch for significant policy and legal changes both inside Taiwan and abroad and, to that end, routinely enlists the help of professional legal and accounting firms to assist in evaluating these changes, to help create effective responses to these changes, and to ensure compliance with these changes, thereby working to reduce the effects of policy and legal changes on our business. In recent years, we have been quite effective in adjusting to policy and legal changes both within and beyond Taiwan and, thus, our overall solid financial health has seen little impact from such changes.

On March 12, 2021, the Financial Supervisory Commission issued Order Jin-Guan-Zeng-Quan No. 1100330121 to expanded the scope of business of securities firms engaging in futures trading assistance business. The Company will handle relevant matters based on business development opportunities and in accordance with the regulations.
On March 31, 2021, the Financial Supervisory Commission issued Order Jin-Guan-Zeng-Quan No. 11003350239 sets out the subject of day trading as stipulated in Paragraph 2, Article 37-1 of "Regulations Governing Securities Firms" In order to protect customers’ trading rights, the Company has charged the relevant units with carrying out the relevant procedures in accordance with the relevant regulations and has made these rules available to employees.
On May 11, 2021, the Financial Supervisory Commission issued Order Jin-Guan-Zeng-Quan No. 11003617675 was announced for Paragraph 3, Article 15 of the Securities and Exchange Act, a securities broker which has acted as a sales agency for securities investment trust funds and offshore funds may operate as an intermediary for trading in beneficiary certificates of funds. An application form shall be submitted to the Taipei Exchange for examination. The Company will handle relevant matters based on business development opportunities and in accordance with the regulations.
On May 20, June 29, and July 30, 2021, the Financial Supervisory Commission issued Jin-Guan-ZengQuan Letter No. 11003621371, Jin-Guan-Zeng-Quan Letter No. 1100362665, and Jin-Guan-ZengQuan Letter No. 1100363085, respectively. The letters were used to define the period of suspension on convening shareholders' meeting by public companies in order to contain and control severe and specific infectious lung disease. “Measures by public companies in relation to the extension of shareholders’ meetings due to pandemic" was also announced and amended as guidance of convening shareholders' meeting by public companies. The Company had held a regular shareholders’ meeting on July 20 in compliance with the relevant pandemic prevention requirements.

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On June 4, 2021, the Financial Supervisory Commission issued Order Jin-Guan-Zeng-Quan No. 11003620392 was announced for Article 45 of the Securities and Exchange Act, Article 2 of the Standards for the Establishment of Securities Firms, Paragraph 1 of Article 31 and Paragraph 2 of Article 36-1 of the Rules Governing Securities Firms, regulating the recommending matters. The Company will handle relevant matters based on business development opportunities and in accordance with the regulations.
On August 9, 2021, the Financial Supervisory Commission issued Order Jin-Guan-Zeng-Quan No. 1100363089 was establish relevant regulations for securities dealers to declare sales of securities that are not held, use of securities lent out by securities companies, securities dealers may sell short securities to finance enterprises, and securities companies engage in securities day trading. The Company will handle relevant matters based on business development opportunities and in accordance with the regulations.
On September 17, 2021, the Financial Supervisory Commission issued Order Jin-Guan-Zeng-Quan No. 11001948991 announced the amendment of certain limit under Paragraph 2-1, Article 29 of the Financial Consumer Protection Law in relation to investment-based financial products or services to NT$1.2 million. The limit for non-investment financial products or services was adjusted to NT$120,000. In order to protect customers’ trading rights, the Company has charged the relevant units with carrying out the relevant procedures in accordance with the relevant regulations and has made these rules available to employees.
On September 30, 2021, the Financial Supervisory Commission issued Order Jin-Guan-Zeng-Quan No. 11003637894 was announced for Articles 36-2 and 37 of the "Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in the Securities and Futures Market", requiring the designation of a person above the Deputy Vice President or with equivalent responsibilities as the Chief Information Security Officer to oversee the promotion of information security policies and resource deployment. To safeguard the information security of the Company and its customers, the Company has charged the relevant units with carrying out the relevant procedures in accordance with the relevant regulations and has made these rules available to employees.
Taiwan Securities Association Chung-Cheng-Shan-Yeh(2) Letter No. 1100006531 dated on December 15, 2021, amending the Administrative Measures for Securities Firms entrusted with the buy and sell of Foreign Securities, adding that when securities firms accept the commission from non-professional investors to buy and sell closed-ended funds, the investor should be eligible and sign a risk disclosure statement upon initial trading. In order to protect customers’ trading rights, the Company has charged the relevant units with carrying out the relevant procedures in accordance with the relevant regulations and has made these rules available to employees.
On December 15, 2021, the Financial Supervisory Commission issued Order Jin-Guan-Zeng-Quan No. 1100365649 was announced in respect of the requirements of Article 45 of the “Securities and Exchange Act” to specify the scope of collateral, loan duration, lending ratio, guarantee maintenance ratio, disposal of collateral, credit facilities of customers, management and utilization of collateral, etc. In order to protect customers’ trading rights, the Company has charged the relevant units with carrying out the relevant procedures in accordance with the relevant regulations and has made these rules available to employees.

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5. Effects of Industry Changes (Including information security risks) and Technological Changes and Measures for Dealing with These Changes.

In response to the changing financial and technological environment, the Company shall create a diversified, fast, stable, and secure electronic ordering platform as a top development priority. In the pursuit of this goal, the Company shall continue to promote system upgrades and development to steadily increase the ratio of the Company’s electronic orders in the coming years.

In view of the phenomenal growth in the use of mobile devices in the Internet generation, the role of securities dealers is bound to be transformed from a purely “broker and platform” to a “digital business” supported by FinTech and AI. Therefore, the Company has set up the “Digital Financial Division” and transformed the physical branches on a trial basis to integrate the virtual and physical channels, so as to promote the digitalization and paperless operations of business procedures. It is planned to gradually complete the online digital services starting from electronic trading in the directions of diverting customer flows, differentiation, and customized services. In addition, the internal operations will be improved to expand the introduction of electronic procedures to enhance efficiency and provide customers with safe and efficient trading platforms.

In response to the increasing trend of placing orders via mobile devices and customized trading in the overall market, customers are provided with the all-round app of the digital integrated financial investment service platform with the app interface adjusted according to customer feedback.

In addition, in response to the FSC’s requirements for strengthening information security in the financial market, the Company will continue to use existing information security management regulations (ISO27001), internal auditing and periodic reviews by third-party certification institutions to enhance the management system. The Company shall also invest specific amounts in the annual budget on the enhancement of the protection of the information security framework to facilitate business growth and create new business opportunities.

The Company has arranged third parties to conduct tests on the information security operations center (SOC), dual ISP backup architecture, and periodic joint prevention tests. Disaster Recovery server room evaluation, support code inspection, initiate trading host conversion to FIX connection project and APP lab inspection have been completed.The goal is to increase the stability of the information system and prevent risks in external information security attacks in order to achieve the goal of fair transactions with investors and create wealth with customers.

6. Significant Impairment of Corporate Image and Measures for Dealing with that Damage.

Our company has a core philosophy of “Good Quality, Good Credibility, Good Service and Fair Prices”. This is combined with the concept of “Professional Leadership, Kind Service”. the Company has been a long-standing supporter of important social charitable activities and devoted to fulfill corporate social responsibility. Since the date of the establishment, the Company has no negative corporate image issues to report.

7. Expected effect of acquisition and the possible risk: None.

8. Expected effect and possible risk of expanding business locations and the countermeasures: None.

9. Expected effect and possible risk of excessive concentration of purchasing sources and excessive customer concentration: Not Applicable.

10. Effects of, Risks Relating to and Response to Large Share Transfers or Changes in Shareholdings by Directors, Supervisors, or Shareholders with Shareholdings of over 10%: None.

11. Effects of, Risks Relating to and Response to the Changes in Management Rights: None.

12. Litigation or Non-litigation Matters

(1) Major lawsuits, non-contentious matters or administrative procedures with a determined court ruling or that are still pending, that may significantly affect the shareholders’ equity or the stock price of the Company (over the previous two years and up to the time that this annual report was published):

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2021 Annual Report

VII. Financial Status, Operating Results and Risk Management

==> picture [492 x 561] intentionally omitted <==

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

Parties involved in Amount
The major claims Date The current progress Remark
major lawsuits (Unit:NT$)
The plaintiff Wang, ○-Cheng (did not Plaintiff: Wang, 2010.7 This case is at the 9,007,179 After the
open an account at the Company and ○-Cheng Supreme Court, and evaluation
traded stocks) claimed that he borrowed Defendant: Chu, the Company has of this case,
a customer account from 2004 through ○-Jung, appointed an attorney the case has
2008 and entrusted business clerk Chu, PSC to file an answer in no material
○-Jung at the Tucheng Branch to buy accordance with the impact on the
and sell stocks. However, Chu, ○-Jung law. shareholders'
sold the stocks in the account secretly equity of the
and expropriated the proceeds from the Company or
stocks. In addition, due to Chu, ○-Jung's the price of
fraud, Wang, ○-Cheng was required to securities.
pay a guarantee deposit and suffered
loss; thus, he claimed that the Company
shall be jointly liable for the indemnity
and filed this lawsuit.
The plaintiff, Ms. Lu ○-Jen, is a former Plaintiffs: 2021.10 This case is at the 1,000,000 After the
securities specialist of the Sanchong Huang Lu ○-Jen Taiwan New Taipei evaluation
Branch where she was dismissed by Defendant: PSC District Court, and of this case,
the Company for misconduct in the the Company has the case has
course of performing his/her business appointed an attorney no material
and subsequently filed a lawsuit to file an answer in impact on the
against the Company for restoration of accordance with the shareholders'
employment and compensation. law. equity of the
Company or
the price of
securities.
The Trade-Van Information Services Plaintiff:The Trade-Van 2020.7 Both parties reached 10,000,000 After the
Co. claimed that there was damage Information Services a settlement in the evaluation
to the delivery of ballots for its 2020 Co. Taipei District Court of this case,
shareholders' meeting, and filed a civil Defendant: on September 8, 2021 the case has
lawsuit against the Company and its chou, ○-hung, and the litigation was no material
employees to demand joint liability and Gong, ○-Da, concluded without impact on the
compensation. Chen, ○-Hua, compensation. shareholders'
Lin, ○-Siou, equity of the
PSC Company or
the price of
securities.
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161

President Securities Corporation

==> picture [492 x 251] intentionally omitted <==

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

Parties involved in Amount
The major claims Date The current progress Remark
major lawsuits (Unit:NT$)
The plaintiffs Huang Hsiang-○ Plaintiffs: 2020.11 This case was 328,133 After the
and Huang Ching-○ applied for Huang Hsiang-○,Huang concluded by the evaluation
the transfer of ○○ stocks under the Ching-○ Taiwan Taipei District of this case,
name of the successor, but failed to Defendant: PSC Court on February 26, the case has
submit the national identity cards of 2021, and the ruling no material
"all inheritors" or the seal certificate of the first instance impact on the
issued by the household registration was that the Company shareholders'
office in accordance with Article 24 shall transfer the ○ equity of the
of the Regulations Governing the ○ stocks under the Company or
Administration of Shareholder Services name of the successor the price of
of Public Companies; as a result, to the plaintiffs and securities.
the transfer could not be completed. the Company was not
Therefore, they filed a civil lawsuit liable for paying any
against the Company to request the compensation.
Company to complete the transfer of
inheritance.
----- End of picture text -----

(2) Any Company director, supervisor, manager, responsible person, or company shareholder holding more than 10% of the company’s shares that is involved in any judgments already handed down or any ongoing litigation, non-litigation, or administrative action over the previous two years up to the time that this annual report was published, the potential effects on shareholder rights and on the company’s share price, the key facts of the dispute, dollar values involved, the date that the litigation was initiated, the key parties involved, and the current status of said litigation(s): None.
(3) Any company director, supervisor, manager, responsible person, or company shareholder holding more than 10% of the company’s shares that has been found in violation of Article 157 of the Securities and Exchange Act over the previous two-year period and up to the time that this annual report was published, and the current status of any related action taken or being taken against that person: The Company claimed for the disgorgement (NT$ 6,750 for price spread and 210 for interest, NT$ 6,960 in total) from a manager whose last name is Chung in accordance to article 157 of the Securities and Exchange Act on December 2, 2021., and informed Securities and Futures Investors Protection Center on December 6, 2021.

13. Other Important Risks:

(1) In response to the Personal Information Protection Act, our company will continue to enforce the consciousness of the importance and the legal risk of personal information processing, money laundry preventing, and financial consumer protection.
(2) Impact of information system damage on the Company’s financial operations and response measures:

The increasingly frequent security attacks may cause disruption to business operations and in turn affect business revenue and damage the corporate image. President Securities Corporation has begun to import the Information Security Management System (ISMS) since 2013, and obtained ISO 27001 certification on August 23, 2013 and continued to maintain the validity of the certification. The information security governance has been gradually developed and implemented, with the strict requirements of various information security standards.

In view of the increasing threat of cyberattacks recently, in order to ensure that computer systems have certain security protection capabilities, it is necessary to upgrade the protection capabilities in each aspect from computer facilities, servers and hosts, user equipment, the internet all the way to e-mail, so as to implement control measures in the technical and management aspects and improve and enhance the security protection capabilities of the internet and information systems. In addition to completing the

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2021 Annual Report

VII. Financial Status, Operating Results and Risk Management

revision and formulation of relevant information security management regulations, the security updates and version upgrades of relevant equipment will be completed gradually. Furthermore, external units are invited to conduct independent inspection, tests, and assessment to identify potential information security risks early.

This year, the information security response speed of relevant units was also strengthened through exercises. The information security response strengthening exercises are as follows:

Social Engineering Exercises for Prevention of Malicious Email
The application system disaster recovery has switched to practice activities.
Distributed Denial-of-Service (DDoS) Attack and Defense Exercises
2021 Financial Supervisory Commission and Its Affiliated Institutions (Organizations) Annual Financial Security Notification Exercises
Information Security and Checkup Assessment
The ultimate goal of hierarchical security protection in the securities and futures industry is to strengthen information security awareness and arrange information security education and training, which includes:
-Information on security incidents and sharing of security concepts
-Personal computer use and daily security operations
-Information security skills training and information security concepts
-Mail security and prevention of social engineering

It aims to improve the security, reliability, availability of information systems and reduce the risks that relevant information security incidents may pose to the Company’s finance.

VII. Other significant events: None.

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President Securities Corporation

VIII. Other Disclosures

I. Consolidated Business Report of Affiliated Companies, Consolidated Financial Statements of Affiliated Companies, and Reports of Affiliation

A. Summary of Affiliated Companies

1. Affiliated Companies Chart

==> picture [451 x 127] intentionally omitted <==

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

PRESIDENT SECURITIES CORPORATION
Shareholding Shareholding Shareholding Shareholding Shareholding Shareholding Shareholding
100% 100% 96.69% 100% 100% 100% 100%
President President President
PSC Venture
Insurance President Capital President Securities President Securities Wealth
Agency Capital Investment Futures Co., Ltd Management (Hong Kong) Limited Nominee Limited Management
Company Limited
Co., Ltd. Corp. (Hong Kong) Limited
----- End of picture text -----

2. Basic Information of Affiliates

==> picture [474 x 346] intentionally omitted <==

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

As of April 30, 2022
Established Paid-in Capital
Company Address Currency Main Business
Date (in thousands)
President Futures B1.,No.8, Dongxing Rd., Taipei
1994.03.01 NTD 660,000 Futures and brokerage
Co., Ltd City
President Capital 3F.,No.8, Dongxing Rd., Taipei Securities investment
Management Corp. 1997.04.15 City NTD 300,000 and consulting
Securities proprietary,
President Securities Unit 2603-6,26/F., Infinitus Plaza
brokerage,
(Hong Kong) 1994.07.26 ,199 Des Voeux Road, Central , HKD 192,600
underwriting ,and
Limited Hong Kong
consulting (Note1)
President Securities Unit 2603-6,26/F., Infinitus Plaza Nominee service
1999.08.06 ,199 Des Voeux Road, Central , HKD 1,000
Nominee Limited (Note1)
Hong Kong
President Wealth Unit 2603-6,26/F., Infinitus Plaza
Wealth management
Management (Hong 2002.03.31 ,199 Des Voeux Road, Central , HKD 23,400
(Note1)
Kong) Limited Hong Kong
President Insurance 7F.,No.8, Dongxing Rd., Taipei
2008.04.29 NTD 10,000 Insurance agent
Agency Co., Ltd. City
Consultation
of investment
PSC Venture management and
2F.,No.8, Dongxing Rd., Taipei
Capital Investment 2013.10.29 NTD 300,000 venture capital; other
City
Company Limited unprohibited or
unrestricted businesses
beyond the permit
----- End of picture text -----

Note : President Securities (BVI) Limited was liquidated in September, 2021.

Note1: President Securities (Hong Kong) Limited, President Securities Nominee Limited, President Wealth Management (Hong Kong) Limited was approved by the board of directors to deal with the dissolution and liquidation matters. The liquidation process is currently in progress.

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2021 Annual Report

VIII. Other Disclosures

3. Rosters of Directors, Supervisors, and Presidents of PSC’s Subsidiaries

As of April 30, 2022

==> picture [465 x 632] intentionally omitted <==

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

Holding Shares
Company Title Representative
Shares Shareholding Ratio
Chairman Huang, Yi-Ming
Director Lin, Kuan-Chen
PSC holds
Director Tsai, Sen-Bu 96.69%
63,817,303 shares
Director Yang , Kai-Chih
President Futures Co., Ltd Director Lin, Jung-Hui
President Wu,Huang-Chi 0 0%
Supervisor Yang, Ya-Ting 0 0%
PIDC holds
Supervisor Kuo,Kuan-Hung 1.00%
660,000 shares
Chairman & President Li, Fang-Kuo
President Capital Management Director Chung, Ling-Chun PSC holds
100%
Corp. Director Wu, Fang-Ling 30,000,000 shares
Supervisor Pan, Lung-Ching
Director Lin, Kuan-Chen
Director & President Ma, Chun-Wah
President Securities (Hong PSC holds
Director An, Chi-Li 100%
Kong) Limited 192,600,000 shares
Director Tsai, Sen-Bu
Director Lu, Fang-Jun
Director Lin, Kuan-Chen
President Securities Nominee Director & President Ma, Chun-Wah PSC holds
100%
Limited Director An, Chi-Li 1,000,000 shares
Director Tsai, Sen-Bu
Director Lin, Kuan-Chen
President Wealth Management Director & President Ma, Chun-Wah PSC holds
100%
(Hong Kong) Limited Director An, Chi-Li 23,400,000 shares
Director Tsai, Sen-Bu
Chairman Lee, Wen-Sheng
President Insurance Agency Co., Director Yu, Hung-Chieh PSC holds
100%
Ltd. Director & President Lu, Hsiang-Chung 1,000,000 shares
Supervisor An, Chi-Li
Chairman Kuo, Li-Yun
PSC Venture Capital Investment Director & President Lu, Mu-Sheng PSC holds
100%
Company Limited Director Hou, James 30,000,000 shares
Supervisor Huang, Ya-Ping
----- End of picture text -----

165

President Securities Corporation

4. Operational Highlights of Affiliated Companies

==> picture [487 x 396] intentionally omitted <==

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

As of December 31, 2021 Unit: thousands
Net
Total Total Total Operating Operating EPS
Company Currency Capital Income
Assets Liabilities Equity Revenue Income ($)
(Loss)
President
Futures Co., NTD 660,000 28,361,392 25,858,531 2,502,861 855,076 (12,837) 119,086 1.8
Ltd
President
Capital
NTD 300,000 365,418 53,327 312 ,091 88,621 (8,961) (8,081) (0.27)
Management
Corp.
President
Insurance
NTD 10,000 68,752 22,519 46,233 85,198 26,508 25,060 25.06
Agency Co.,
Ltd.
PSC Venture
Capital
Investment NTD 300,000 281,346 8 ,287 273,059 42,717 30,691 30,924 1.03
Company
Limited
President
Securities
HKD 192,600 615,003 251,613 363,390 26,045 (10,004 ) (7,592) (0.039)
(Hong Kong)
Limited
President
Securities
HKD 1,000 448 17 431 0 (25) (24) (0.024)
Nominee
Limited
President
Wealth
Management HKD 23,400 15,257 21 15 ,236 0 (42) (11) (0.0004)
(Hong Kong)
Limited
----- End of picture text -----

Note: Foreign exchange rates:

USD/NTD (end of 2021) =27.6800 USD/NTD (2021 average) =27.9982 HKD/NTD (end of 2021) =3.5490 HKD/NTD (2021 average) =3.6014

B. Consolidated Financial Statements of Affiliated Companies

In 2021, in accordance with Article 33 of Regulations Governing the Preparation of Financial Reports by Securities Firms and Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises, the companies that shall be included in the preparation of the consolidated financial statements of affiliated companies were the same as the companies that shall be included in the consolidated financial statements of the parent company and subsidiaries in accordance with the International Financial Reporting Standards No. 10. Please refer to the Financial Statement of Chapter Six Financial Overview V. The Consolidated Financial Statements of the Parent Company and Subsidiaries Certified by the CPAs for the Year of 2021.

C. Reports of Affiliation

Since the Company is a controlling company, it does not need to prepare such reports.

II. In the most recent year up to the publication date of this annual report, as for the private placement of marketable securities, the quantity approved by the shareholders’ meeting or the Board of Directors and the approval date, the basis for price determination and the reasonableness, the specific person selection method, and necessary reasons for the private placement shall be disclosed: None.

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2021 Annual Report

VIII. Other Disclosures

III. Holding or disposal of the company’s shares by the subsidiaries in the most recent year up to the publication date of this annual report: None.

IV. Other Necessary Supplement

A. KPI Performance Indicator

1. Capital Adequacy Ratio

Within the securities industry, a company’s capital adequacy rate is viewed as a key performance indicator. Many BIS regulations require that a securities firm has a minimum capital adequacy rate of 200% in order to be permitted to operate in many key business areas. As such, this level can be seen as an important benchmark in evaluating a securities firm’s business performance and risk management measures. As of March 2022, our capital adequacy rate stood at 412%, well above this key 200% level.

2. Market Share Rate

Market share of various business could be used for performance indicators. It could represent company’s weighted market share and perceptive of future trend, which help to analyze management performance. Our company’s Brokerage market share was 3.17% in 2021, ranked the 12th among competitors. Average single branch market share was 0.10%, ranked the 7th among top 10 competitors. Compared with other securities firms, our performance was more efficient and competitive. Currently our company continues to build comprehensive and personalized information platform to improve stability of electronic transactions and orders, train sales with multiple financial ability, hoping to create more profit for customers and company.

167

President Securities Corporation

IX. Occurrences of items that may give rises to substantial impact on shareholders’ interests and/or stock price as defined in NO.3-2 Article 36 of Securities and Exchange Law in the latest fiscal year including the days counting to the publication of the annual reports: None.

168

President Securities Corporation

X. Financial Statements

PRESIDENT SECURITIES CORPORATION

PARENT COMPANY ONLY FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’

REPORT

December 31, 2021 AND 2020

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

169

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

PWCR21003287

To the Board of Directors and Shareholders of President Securities Corporation

Opinion

We have audited the accompanying parent company only balance sheets of President Securities Corporation as at December 31, 2021 and 2020, and the related parent company only statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the parent company only financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the parent company only financial position of President Securities Corporation as at December 31, 2021 and 2020, and its parent company only financial performance and its parent company only cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Firms and Regulations Governing the Preparation of Financial Reports by Futures Commission Merchants.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the parent company only financial statements section of our report. We are independent of President Securities Corporation in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the parent company’s 2021 only financial statements. These matters were addressed in the context of our audit of the parent company only financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

The key audit matters of the parent company’s 2021 only financial statements are stated as follows:

170

Fair value measurement of unlisted stocks without active market

Description

Please refer to Note 4(7) for the accounting policies on unlisted stocks without active market (shown as “financial assets at fair value through other comprehensive income”) and Note 5 for details of significant judgements, estimates and assumption uncertainty. As at December 31, 2021, the unlisted stocks without active market held by the President Securities Corporation totaled 258,627 thousand New Taiwan Dollars and were shown as “financial assets at fair value through other comprehensive income” (Level 3 fair value).

Due to the lack of an active market, the fair value of the unlisted stocks held by the President Securities Corporation was determined using valuation method. Management measured its fair value by using comparable listed companies in market approach. The main assumption of market approach is calculating based on the latest published price-book ratio of comparable listed companies in similar industries and considering discounts on market liquidity or risk particularity.

Above-mentioned estimation of fair value involves various assumptions and material unobservable inputs, which has high uncertainty and relies on the subjective judgment of management. Any changes in judgements and estimates may affect the ultimate result of accounting estimates and have an impact on the financial statements of the President Securities Corporation. Thus, we have included the fair value measurement of unlisted stocks without active market as a key audit matter in our audit.

How our audit addressed the matter

We performed the following audit procedures on the above key audit matter:

Obtained an understanding and assessed policy documents, internal control system, fair value measurement models and approval processes that are related to fair value measurement of unlisted stock;
Ascertained whether the measurement methods used by the management is commonly used by the industry;
Assessed the reasonableness of parameter of similar companies used by management;
Examined inputs and calculation formulas used in valuation methods and agreed such data to supporting documents.

171

Impairment assessment of investments accounted for under the equity method

Description

Please refer to Note 4(13) for accounting policies on investments accounted for under the equity method and its impairment, Note 5(2) for the uncertainty of accounting estimates and assumptions applied on asset impairment, and Note 6(11) for details of investments accounted for under the equity method.

President Securities Corporation held 42.46% of equity of Uni-President Asset Management Corp. which was accounted for under the equity method, and the excess of the carrying amount over the share of the investee company’s net assets is mainly goodwill. As of December 31, 2021, the amount was 760,171 thousand New Taiwan Dollars. Impairment assessment is based on the expected future cash flow of the investee, discounted at an appropriate discount rate, to measure the recoverable amount of the cash generating unit.

The recoverable amount of the investee is based on its expected future cash flows which involve multiple estimates and assumptions on discount rate and financial forecast. These are subjective judgements, have a high degree of uncertainties, and are material to the recoverable amount. Thus we consider the impairment assessment of investments accounted for under the equity method as one of the matters of most significance to our audit.

How our audit addressed the matter

We performed the following audit procedures on the above key audit matter:

1.Obtained the impairment assessment report prepared by an external valuation expert who was commissioned by the management;
2.Assessed the reasonableness of expected future cash flows, discount rate and other significant assumptions applied in the cash flow model; and
3.Inspected valuation model parameters, formula setting and the accuracy of calculation.

172

Responsibilities of management and those charged with governance for the parent company only financial statements

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, Regulations Governing the Preparation of Financial Reports by Futures Commission Merchants, and for such internal control as management determines is necessary to enable the preparation of parent company only financial statement that are free from material misstatement, whether due to fraud or error.

In preparing the parent company only financial statements, management is responsible for assessing President Securities Corporation’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate President Securities Corporation or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including audit committee, are responsible for overseeing President Securities Corporation’s financial reporting process.

Auditors’ responsibilities for the audit of the parent company only financial statements

Our objectives are to obtain reasonable assurance about whether the parent company only financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the generally accepted auditing standards in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these parent company only financial statements.

As part of an audit in accordance with the generally accepted auditing standards in the Republic of China, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the parent company only financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one

173

resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

2.

3.

4.

5.

6.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of President Securities Corporation’s internal control.

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

Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on President Securities Corporation’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause President Securities Corporation to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the parent company only financial statements, including the disclosures, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within President Securities Corporation to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

174

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Independent Auditors

Lin, Se-Kai Lo, Chiao-Sen

For and on behalf of PricewaterhouseCoopers, Taiwan March 8, 2022

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying parent company only financial statements are not intended to present the financial position and financial performance 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 parent company only financial statements and independent auditors' 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.

175

PRESIDENT SECURITIES CORPORATION PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Assets	December 31, 2021 AMOUNT % `$` `3,082,958` `3` `33,286,663` `35` `410,205` `1` `27,401` `-` `18,344,751` `19` `29,930` `-` `24,933` `-` `1,581,993` `2` `401,019` `-` `1,437,295` `2` `470` `-` `16,549,427` `17` `4,792` `-` `21,059` `-` `5,709` `-` `7,992,320` `8` `83,200,925` `87` `62,774` `-` `258,627` `-` `7,518,999` `8` `2,271,270` `3` `191,960` `-` `268,402` `1` `145,690` `-` `155,567` `-` `1,117,438` `1` `11,990,727` `13` `$` `95,191,652` `100`	December 31, 2020	December 31, 2020
	AMOUNT `$` `3,082,958` `33,286,663` `410,205` `27,401` `18,344,751` `29,930` `24,933` `1,581,993` `401,019` `1,437,295` `470` `16,549,427` `4,792` `21,059` `5,709` `7,992,320` `83,200,925` `62,774` `258,627` `7,518,999` `2,271,270` `191,960` `268,402` `145,690` `155,567` `1,117,438` `11,990,727` `$` `95,191,652`	AMOUNT `$` `3,507,116` `40,831,878` `353,510` `-` `12,248,272` `51,532` `42,889` `1,288,127` `240,796` `1,007,090` `737` `17,635,068` `4,413` `20,463` `9,518` `2,156,587` `79,397,996` `67,484` `186,334` `7,247,316` `2,270,322` `171,581` `270,503` `94,479` `99,384` `1,044,489` `11,451,892` `$` `90,849,888`	%
110000 Current assets 111100 Cash and cash equivalents 112000 Financial assets at fair value through profit or loss - current 113200 Financial assets at fair value through other comprehensive income - current 114010 Bonds purchased under resale agreements 114030 Margin loans receivable 114040 Refinancing security deposits 114050 Receivables from refinance guaranty 114060 Receivable of securities business money lending 114090 Receivables from security lending 114100 Security lending deposits 114110 Notes receivable 114130 Accounts receivable 114140 Accounts receivable - related parties 114150 Prepayments 114170 Other receivables 119000 Other current assets 110000 Total current assets 120000 Noncurrent assets 122000 Financial assets at fair value through profit or loss - non-current 123200 Financial assets at fair value through other comprehensive income - non- current 124100 Investments accounted for under the equity method 125000 Property and equipment, net 125800 Right-of-use assets 126000 Investment property 127000 Intangible assets 128000 Deferred tax assets 129000 Other assets - non-current 120000 Total non-current assets 906001 Total Assets			`4` `45` `-` `-` `14` `-` `-` `2` `-` `1` `-` `19` `-` `-` `-` `2`
			`87`
			`-` `-` `8` `3` `-` `1` `-` `-` `1`
			`13`
			`100`

(Continued)

176

PRESIDENT SECURITIES CORPORATION PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	December 31, 2021 AMOUNT % `$` `590,000` `1` `8,648,558` `9` `8,171,735` `9` `9,643,040` `10` `1,202,587` `1` `1,559,162` `2` `1,969,207` `2` `97,996` `-` `17,421,499` `18` `481` `-` `5,739,850` `6` `2,499,848` `3` `4,983,139` `5` `628,676` `1` `62,878` `-` `73,094` `-` `63,291,750` `67` `14,079` `-` `120,489` `-` `-` `-` `81,750` `-` `216,318` `-` `63,508,068` `67` `14,558,313` `15` `91,261` `-` `3,487,748` `4` `8,314,199` `9` `3,922,562` `4` `1,309,501` `1` `31,683,584` `33` `$` `95,191,652` `100`	December 31, 2020	December 31, 2020
	AMOUNT `$` `590,000` `8,648,558` `8,171,735` `9,643,040` `1,202,587` `1,559,162` `1,969,207` `97,996` `17,421,499` `481` `5,739,850` `2,499,848` `4,983,139` `628,676` `62,878` `73,094` `63,291,750` `14,079` `120,489` `-` `81,750` `216,318` `63,508,068` `14,558,313` `91,261` `3,487,748` `8,314,199` `3,922,562` `1,309,501` `31,683,584` `$` `95,191,652`	AMOUNT `$` `578,976` `7,298,896` `2,622,141` `19,096,165` `1,381,470` `1,809,955` `903,852` `28,105` `18,038,119` `332` `1,098,674` `1,975,239` `6,008,310` `324,555` `61,875` `76,474` `61,303,138` `8,627` `103,607` `2,813` `24,388` `139,435` `61,442,573` `13,998,378` `91,261` `3,111,013` `7,600,316` `3,771,859` `834,488` `29,407,315` `$` `90,849,888`	%
210000 Current liabilities 211100 Short-term loans 211200 Commercial papers payable 212000 Financial liabilities at fair value through profit or loss - current 214010 Bonds sold under repurchase agreements 214040 Deposits on short sales 214050 Short sale proceeds payable 214070 Guarantee deposit received on borrowed securities 214090 Equity for each customer in the account 214130 Accounts payable 214150 Advance receipts 214160 Collections on behalf of third parties 214170 Other payables 214200 Other financial liabilities - current 214600 Current tax liability 216000 Current lease liabilities 219000 Other current liabilities 210000 Total current liabilities 220000 Non-current liabilities 225100 Non-current provisions 226000 Non-current lease liabilities 228000 Deferred tax liability 229000 Other liabilities - non-current 220000 Total non-current liabilities 906003 Total Liabilities 301000 Capital 301010 Common stock 302000 Capital reserve 304000 Retained earnings 304010 Legal reserve 304020 Special reserve 304040 Unappropriated earnings 305000 Other equity interest 906004 Total equity 906002 Total liabilities and equity			`1` `8` `3` `21` `2` `2` `1` `-` `20` `-` `1` `2` `7` `-` `-` `-`
			`68`
			`-` `-` `-` `-`
			`-`
			`68`
			`15` `-` `4` `8` `4` `1`
			`32`
			`100`

The accompanying notes are an integral part of these parent company only financial statements.

177

PRESIDENT SECURITIES CORPORATION

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Items Year ended December 31
2021
2020
Notes
AMOUNT
%
AMOUNT
%
6(29)
$
4,153,616
39
$
2,465,522
29
6(30)
104,035
1
76,506
1
32,127
-
22,312
-
6(31)
8,738,972
83
3,351,750
40
85,817
1
77,732
1
6(32)
1,159,210
11
1,052,595
12
451,249
4
382,536
4
6(33)
(
862,680) (
8)
995,619
12
6(34)
(
181,893) (
2)
268,439
3
6(35)
(
313,159) (
3) (
117,021) (
1)
6(36)
-
-
100,358
1
76,579
1 (
83,151) (
1)
17,312
-
2,870
-
6(37)
(
2,896,956) (
27)
95,405
1
42,884
-
40,206
-
6(38)
(
655,306) (
6) (
120,517) (
1)
6(39)
11,158
- (
15,308)
-
6(40)
615,039
6 (
122,869) (
1)
10,578,004
100
8,472,984
100
6(41)
(
560,293) (
5) (
373,105) (
5)
(
6,863)
- (
5,658)
-
6(42)
(
88,091) (
1) (
249,390) (
3)
(
302)
- (
182)
-
(
14,089)
- (
11,731)
-
(
3,049)
- (
26)
-
6(43)
(
3,615,086) (
34) (
2,796,016) (
33)
6(44)
(
175,565) (
2) (
157,405) (
2)
6(45)
(
1,851,991) (
18) (
1,357,216) (
16)
(
6,315,329) (
60) (
4,950,729) (
59)
4,262,675
40
3,522,255
41
6(11)
213,779
2
303,699
4
6(46)
156,325
2
100,642
1
4,632,779
44
3,926,596
46
6(47)
(
625,344) (
6) (
319,078) (
4)
$
4,007,435
38
$
3,607,518
42

400000Revenues
401000
Brokerage handling fee revenue
404000
Revenues from underwriting
business
406000
Net gain (loss) on wealth
management
410000
Net gain (loss) on sale of trading
securities
421100
Revenue from providing agency
service for stock affairs
421200
Interest revenue
421300
Dividend revenue
421500
Net valuation gain (loss) on
operating securities at fair value
through profit or loss
421600
Net gain (loss) on covering of
borrowed securities and bonds with
resale agreements-short sales
421610
Net valuation gain (loss) on
borrowed securities and bonds with
resale agreements-short sales at fair
value through profit or loss
421750
Net realised gain (loss) on financial
assets measured at fair value through
other comprehensive income-bonds
422000
Net gain (loss) on issuance of ETNs
422100
Administrative and handling fee
revenues from issuance of ETNs
422200
Net gain (loss) from issuance of call
(put) warrants
424100
Future commission revenue
424400
Net gain (loss) from derivatives
425300
Impairment loss and reversal of
impairment gain
428000
Other operating income
Total revenue
500000Expenditures and expenses
501000/
502000/
503000
Handling charges
507000
ETNs administrative expenses
521200
Interest expenses
524200
Securities commission expense
524300
Expense of clearing and settlement
528000
Other operating expenditure
531000
Employee benefits expense
532000
Depreciation and amortization
533000
Other operating expense
Total expenditure and expense
Operating profit
601100
Share of the profit or loss of
associates and joint ventures
accounted for under the equity
method
602000
Other gains and losses
902001Profit or loss before tax
701000
Income tax (expense) benefit
902005Net income (loss)

(Continued)

178

PRESIDENT SECURITIES CORPORATION

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Items	Year ended December 31	Year ended December 31
	2021	2020
			%
Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 805510 Remeasurements of defined benefit plan 805540 Net unrealised gain (loss) from investments in equity instruments at fair value through other comprehensive income 805560 Other comprehensive gain (loss) of subsidiaries, associates, and joint ventures accounted for under the equity method - not reclassified to profit or loss 805599 Income tax benefit relating to components of other comprehensive income that will not be reclassified to profit or loss Items may be reclassified to profit or loss subsequently 805610 Translation gain (loss) on the financial statements of foreign operating entities 805615 Net unrealised gain (loss) from investments in debt instruments at fair value through other comprehensive income 805000 Current other comprehensive income (loss) (post-tax) 902006Total current comprehensive income Earnings per share 975000 Basic earnings per share (in dollars) 985000 Diluted earnings per share (in dollars)			`-` `5` `1` `-` `-` `-`
			`6`
			`48`
			`2.48`
		`$`	`2.47`

The accompanying notes are an integral part of these parent company only financial statements.

179

PRESIDENT SECURITIES CORPORATION

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

For the year ended December 31, 2020 Balance at January 1, 2020 Net income for the year ended December 31, 2020 Other comprehensive income (loss) for the year ended December 31, 2020 Total comprehensive income (loss) Appropriations of 2019 earnings Legal reserve Special reserve Cash dividends Stock dividends Disposal of investments in equity instruments designated at fair value through other comprehensive income Balance at December 31, 2020 For the year ended December 31, 2021 Balance at January 1, 2021 Net income for the year ended December 31, 2021 Other comprehensive income (loss) for the year ended December 31, 2021 Total comprehensive income (loss) Appropriations of 2020 earnings Legal reserve Special reserve Cash dividends Stock dividends Balance at December 31, 2021	Notes		Common stock		Capital reserve				Retained Earnings			Other equity interest	Other equity interest		Total equity
							Legal reserve		Special reserve		Unappropriated earnings	Exchange differences on translation of foreign financial statements	Unrealised gain or loss on financial assets measured at fair value through other comprehensive income
	6(28) 6(28)		`$` `13,723,900` `-` `-` `-` `-` `-` `-` `274,478` `-` `$` `13,998,378` `$` `13,998,378` `-` `-` `-` `-` `-` `-` `559,935` `$` `14,558,313`		`$` `91,261` `-` `-` `-` `-` `-` `-` `-` `-` `$` `91,261` `$` `91,261` `-` `-` `-` `-` `-` `-` `-` `$` `91,261`		`$` `2,876,769` `-` `-` `-` `234,244` `-` `-` `-` `-` `$` `3,111,013` `$` `3,111,013` `-` `-` `-` `376,735` `-` `-` `-` `$` `3,487,748`		`$` `7,130,830` `-` `-` `-` `-` `469,486` `-` `-` `-` `$` `7,600,316` `$` `7,600,316` `-` `-` `-` `-` `713,883` `-` `-` `$` `8,314,199`	`$` `2,355,105` `3,607,518` `(` `17,197 )` `3,590,321` `(` `234,244 )` `(` `469,486 )` `(` `1,372,390 )` `(` `274,478 )` `177,031` `$` `3,771,859` `$` `3,771,859` `4,007,435` `(` `106,422 )` `3,901,013` `(` `376,735 )` `(` `713,883 )` `(` `2,099,757 )` `(` `559,935 )` `$` `3,922,562`		`($` `58,216` `)` `-` `27,298` `27,298` `-` `-` `-` `-` `-` `($` `30,918` `)` `($` `30,918` `)` `-` `(` `34,891` `)` `(` `34,891` `)` `-` `-` `-` `-` `($` `65,809` `)`	`$` `580,031` `-` `462,406` `462,406` `-` `-` `-` `-` `(` `177,031 )` `$` `865,406` `$` `865,406` `-` `509,904` `509,904` `-` `-` `-` `-` `$` `1,375,310`	`$` `26,699,680` `3,607,518` `472,507` `4,080,025` `-` `-` `(` `1,372,390` `)` `-` `-` `$` `29,407,315` `$` `29,407,315` `4,007,435` `368,591` `4,376,026` `-` `-` `(` `2,099,757` `)` `-` `$` `31,683,584`

The accompanying notes are an integral part of these parent company only financial statements.

180

PRESIDENT SECURITIES CORPORATION

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax
Adjustments
Adjustments to reconcile profit (loss)
Net valuation (gain) loss on operating securities at fair value
through profit or loss

Net valuation (gain) loss on borrowed securities and bonds
with resale agreements-short sales at fair value through profit
or loss

Impairment loss and reversal of impairment gain

Depreciation

Amortization

Interest expense

Interest income (include financial income)

Dividend income
Share of profit of subsidiaries, associates and joint ventures
accounted for under the equity method

(Gain) loss on disposal of property and equipment

(Gain) loss on disposal of investments
(Gain) loss from lease modification

(Gain) loss on valuation of non-operating financial
instrument

Changes in operating assets and liabilities
Net changes in operating assets
Financial assets at fair value through profit or loss - current
Financial assets at fair value through other comprehensive
income - current
Bonds purchased under resale agreements
Margin loans receivable
Refinancing security deposits
Receivables from refinance guaranty
Receivable of securities business money lending
Receivables from security lending
Security lending deposits
Notes receivable
Accounts receivable
Accounts receivable - related parties
Prepayments
Other receivables
Other current assets
Net changes in liabilities relating to operating activities
Financial liabilities at fair value through profit or loss
Bonds sold under repurchase agreements
Deposits on short sales
Short sale proceeds payable
Guarantee deposit received on borrowed securities
Equity for each customer in the account
Accounts payable
Advance receipts
Collections on behalf of third parties
Other payable
Other financial liabilities - current
Other current liabilities Year ended December 31
Notes
2021
2020
$
4,632,779 $
3,926,596
6(2)(33)
862,680 (
995,619 )
6(35)
313,159
117,021
6(39)
(
7,846 )
17,510
6(44)
150,889
142,494
6(44)
24,676
14,911
6(42)
88,091
249,390
6(32)(46)
(
1,169,070 ) (
1,064,310 )
(
462,602 ) (
390,222 )
6(11)
(
213,779 ) (
303,699 )
6(12)
- (
1 )
-
25,676
6(46)
(
7 )
-
6(46)
4,901
7,352
6,679,835
3,655,513
- (
13,884 )
(
27,401 )
-
(
6,085,072 ) (
2,239,117 )
21,602
51,013
17,956
45,870
(
293,866 ) (
770,318 )
(
160,223 ) (
139,753 )
(
430,205 ) (
463,919 )
267 (
40 )
1,120,283 (
6,291,689 )
(
379 ) (
1,798 )
(
596 ) (
1,999 )
3,739 (
578 )
(
5,835,733 ) (
1,611,663 )
5,236,435
1,656,855
(
9,453,125 ) (
1,860,091 )
(
178,883 ) (
177,247 )
(
250,793 ) (
78,877 )
1,065,355
847,848
69,891
27,472
(
555,071 )
6,964,657
149
22
4,641,176
723,092
524,317
740,631
(
1,025,171 )
3,264,444
(
3,380 )
63,875

(Continued)

181

PRESIDENT SECURITIES CORPORATION

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Cash (outflow) inflow generated from operations
Interest received
Dividends received
Income tax paid
Net cash flows from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Investments accounted for under the equity method
Acquisition of property and equipment

(Gain) loss on disposal of property and equipment
Acquisition of intangible assets

(Increase) decrease in other non-current assets
(Increase) decrease in prepayment for equipment
Acquisition of investments accounted for under the equity
method
Net cash flows used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term loans
Increase (decrease) in commercial papers payable
Increase (decrease) in other non-current liabilities
Payments of lease liabilities
Interest paid
Distribution of cash dividends

Net cash flows used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year Year ended December 31
Notes
2021
2020
( $
695,022 ) $
6,137,418
1,079,490
1,138,004
713,513
609,128
(
354,754 ) (
161,284 )
743,227
7,723,266
- (
3,844,497 )
6(12)
(
46,729 ) (
23,990 )
-
13
6(16)
(
41,381 ) (
10,032 )
(
84,734 ) (
84,496 )
(
123,975 ) (
69,632 )
-
2,263,273
(
296,819 ) (
1,769,361 )
11,024 (
2,266,526 )
1,350,000 (
2,300,000 )
(
969 ) (
2,537 )
(
67,865 ) (
66,454 )
(
94,833 ) (
261,268 )
6(28)
(
2,099,757 ) (
1,372,390 )
(
902,400 ) (
6,269,175 )
31,834 (
7,265 )
(
424,158 ) (
322,535 )
3,507,116
3,829,651
$
3,082,958 $
3,507,116

The accompanying notes are an integral part of these parent company only financial statements.

182

PRESIDENT SECURITIES CORPORATION

NOTES TO THE PARENT COMPANY ONLY FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

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

1. HISTORY AND ORGANIZATION

1) President Securities Corporation (the “Company”) was incorporated as a company limited by shares under the provisions of the Company Law of the Republic of China (R.O.C.) on December 17, 1988 and was renamed as President Securities Corporation on March 4, 1989. The Company started commercial operations on April 3, 1989. As of December 31, 2021, the Company had 31 operating branches (including the Head Office) and established Offshore Securities Unit in July 2014.
2) The Company is primarily engaged in underwriting of securities, dealing or brokerage business of securities at the securities exchange markets and business premises, registration and transfer agency service for securities, margin loans and short sales business of securities, securities lending and borrowing business, futures introducing brokerage services, futures dealing, issuance of call (put) warrants, new financial instrument transactions, wealth management business, and trust business.
3) The Company’s shares are listed on the Taiwan Stock Exchange.
4) The number of employees of the Company were 1,447 and 1,434, as of December 31, 2021 and 2020.
THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE FINANCIAL

STATEMENTS AND PROCEDURES FOR AUTHORIZATION

These parent company only financial statements were authorized for issuance by the Board of Directors on March 8, 2022.
APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS
1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

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

New Standards,Interpretations and Amendments	Effective Date by International Accounting Standards Board
Amendments to IFRS 4, ‘Extension of the temporary exemption from applying IFRS 9’ Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘ Interest Rate Benchmark Reform— Phase 2’	January 1, 2021 January 1, 2021

183

2)

3)

The above standards and interpretations have no significant impact to the Company’s
financial condition and financial performance based on the Company’s assessment.
Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet
adopted by the Company
New standards, interpretations and amendments endorsed by FSC effective from 2022 are
as follows:
The above standards and interpretations have no significant impact to the Company’s
financial condition and financial performance based on the Company’s assessment.
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 endorsed by the FSC effective are as follows:
New Standards,Interpretations and Amendments
Effective Date by
International
Accounting Standards
Board
Amendment to IFRS 16, ‘Covid-19-related rent concessions
beyond 30 June 2021’
April 1, 2021(Note)
Note：Earlier application from January 1, 2021 is allowed by FSC.
New Standards,Interpretations and Amendments
Effective Date by
International Accounting
Standards Board
Amendments to IFRS 3, ‘Reference to the conceptual framework’
January 1, 2022
Amendments to IAS 16, ‘Property, plant and equipment:
proceeds before intended use’
January 1, 2022
Amendments to IAS 37, ‘Onerous contracts—
cost of fulfilling a contract’
January 1, 2022
Annual improvements to IFRS Standards 2018–2020
January 1, 2022

IFRSs endorsed by the FSC effective are as follows:
New Standards,Interpretations and Amendments Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets between an investor and its associate or joint venture’ IFRS 17, ‘Insurance contracts’ Amendments to IFRS 17, 'Insurance contracts' Amendment to IFRS 17, 'Initial application of IFRS 17 and IFRS 9 – comparative information'	Effective Date by International Accounting Standards Board
	To be determined by International Accounting Standards Board January 1, 2023 January 1, 2023 January 1, 2023

184

	Effective Date by
	International Accounting
New Standards, Interpretations and Amendments	Standards Board
Amendments to IAS 1, ‘Classification of liabilities as current or non- current’	January 1, 2023
Amendments to IAS 1, ‘Disclosure of accounting policies’	January 1, 2023
Amendments to IAS 8, ‘Definition of accounting estimates’	January 1, 2023
Amendments to IAS 12, ‘Deferred tax related to assets and liabilities arising from a single transaction’	January 1, 2023

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company’s significant accounting policies are described below:

1) Compliance statement

The financial statements of the Company have been prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Firms” and “Regulations Governing the Preparation of Financial Reports by Futures Commission Merchants”.

2) Basis of preparation
A. Except for the following items, these 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/Available-forsale financial assets measured at fair value.
- (C) Defined benefit assets or liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligations.
B. The preparation of financial statements in conformity with International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretation 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 Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 5.
3) Classification of current and non-current items
A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets:
- (A) Assets arising from operating activities that are expected to be realized, or are

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intended to be sold or consumed within the normal operating cycle;

  - (B) Assets held mainly for trading purposes;

  - (C) Assets that are expected to be realized within twelve months from the balance sheet date;

  - (D) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.

B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:
- (A) Liabilities that are expected to be paid off within the normal operating cycle;
- (B) Liabilities arising mainly from trading activities;
- (C) Liabilities that are to be paid off within twelve months from the balance sheet date;
- (D) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.
4) Translation of foreign currency transactions
A. Foreign currency translation and presentation
- Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (the “functional currency”). Functional currency and bookkeeping currency of the Company is New Taiwan Dollars.
B. Foreign currency transactions and balances
- Foreign currency transactions denominated in a foreign currency or required to settle in a foreign currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions.
- Assets and liabilities denominated in foreign currency are translated by the closing exchange rate at balance sheet date. The closing exchange rate is determined by the market exchange rate. Non-monetary assets and liabilities denominated in foreign currencies which are carried at historical cost are re-translated at the exchange rates prevailing at the original transaction date. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are retranslated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in other comprehensive income.

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C. Translation of foreign operations

The operating results and financial position of all the company entities, associates and joint arrangements that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

  - (A) Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet;

  - (B) Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period; and

  - (C) All resulting exchange differences are recognized in other comprehensive income.

5) Cash and cash equivalents
A. In the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with banks, and other short-term highly liquid investments.
B. Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits that meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.
6) Financial assets at fair value through profit or loss
A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortized cost or fair value through other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognized and derecognized using trade date accounting.
C. At initial recognition, the Company measures the financial assets at fair value and recognizes the transaction costs in profit or loss. The Company subsequently measures the financial assets at fair value and recognizes the gain or loss in profit or loss.
D. The Company recognizes the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Company and the amount of the dividend can be measured reliably.
7) Financial assets at fair value through other comprehensive income
A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Company has made an irrevocable election at initial recognition to recognize changes in fair value in other comprehensive income and debt instruments which meet all of the following criteria:
- (A)The objective of the Company’s business model is achieved both by collecting contractual cash flows and selling financial assets; and
- (B)The assets’ contractual cash flows represent solely payments of principal and interest.
B. On a regular way purchase or sale basis, financial assets at fair value through other comprehensive income are recognized and derecognized using trade date accounting.

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C. At initial recognition, the Company measures the financial assets at fair value plus transaction costs. The Company subsequently measures the financial assets at fair value:
- (A)The changes in fair value of equity investments that were recognized in other comprehensive income are reclassified to retained earnings and are not reclassified to profit or loss following the derecognition of the investment. Dividends are recognized as revenue when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Company and the amount of the dividend can be measured reliably.
- (B)Except for the recognition of impairment loss, interest income and gain or loss on foreign exchange which are recognized in profit or loss, the changes in fair value of debt instruments are taken through other comprehensive income. When the financial asset is derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss.
8) Notes and accounts receivable, other receivables and margin loans receivable
A. Accounts and notes receivable and margin loans receivables entitle the Company a legal right to receive consideration in exchange for transferred goods or rendered services.
B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.
9) Bonds sold under repurchase agreements and bonds purchased under resale agreements Bond transactions under repurchase or resale agreements are stated at the amount of actual payment or receipt. When transactions of bonds with a condition of resale agreements occur, the actual payment or receipt shall be recognized in ‘bonds purchased under resale agreements’ under current assets. When transactions of bonds with a condition of repurchase agreements occur, the actual payment or receipt shall be recognized in ‘bonds sold under repurchase agreements’ under current liabilities. Any difference between the actual payment/receipt and predetermined redemption (repurchase) price is recognized in interest income or interest expense.
10) Impairment of financial assets
For debt instruments measured at fair value through other comprehensive income, at each reporting date, the Company recognizes the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognizes the impairment provision for the lifetime expected credit losses (ECLs) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable or contract assets that do not contain a significant financing component, the Company recognizes the impairment provision for lifetime ECLs.

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11) Derecognition of financial instruments

A. Derecognition of financial assets

The Company derecognizes a financial asset when one of the following conditions is met:

(A) The contractual rights to receive cash flows from the financial asset expire.
(B) The contractual rights to receive cash flows from the financial asset have been transferred and the Company has transferred substantially all risks and rewards of ownership of the financial asset.
(C) The contractual rights to receive cash flows of the financial asset have been transferred; however, the Company has not retained control of the financial asset.
B. Derecognition of financial liabilities
A financial liability is derecognized when the obligation under the liability specified in the contract is discharged or cancelled or expired.

12) Offsetting financial instruments

Financial assets and liabilities are offset and reported in the net amount in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously.

13) Investments accounted for under the equity method/Subsidiaries and associates
A. Subsidiaries are all entities (including structured entities) controlled by the Company. The Company controls an entity when the Company is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Investments in subsidiaries are accounted for using the equity method and are initially recognized at cost.
B. Unrealized gains on transactions between the Company and its subsidiaries are eliminated to the extent of the Company’s interest in the subsidiaries. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Company.
C. The Company’s share of its subsidiaries’ post-acquisition profits or losses is recognized in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. When the Company’s share of losses in a subsidiary equals or exceeds its interest in the subsidiary, including any other unsecured receivables, the Company does not recognize further losses.
D. Associates are all entities over which the Company has significant influence but not control. In general, it is presumed that the investor has significant influence, if an investor holds, directly or indirectly 20 percent or more of the voting power of the investee. Investments in associates are accounted for using the equity method and are initially recognized at cost.
E. The Company’s share of its associates’ post-acquisition profits or losses is recognized

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in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. When the Company’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Company does not recognize further losses, unless it has incurred statutory/constructive obligations or made payments on behalf of the associate.

F. When changes in an associate’s equity that are not recognized in profit or loss or other comprehensive income of the associate and such changes not affecting the Company’s ownership percentage of the associate, the Company recognizes its share of change in equity of the associate in ‘capital surplus’ in proportion to its ownership.
G. Unrealized gains on transactions between the Company and its associates are eliminated to the extent of the Company’s interest in the associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Company.
H. According to "Regulations Governing the Preparation of Financial Reports by Securities Firms", the profit or loss for the period and other comprehensive income presented in parent company only financial reports shall be the same as the allocations of profit or loss for the period and of other comprehensive income attributable to owners of the parent presented in the financial reports prepared on a consolidated basis, and the owners' equity presented in the parent company only financial reports shall be the same as the equity attributable to owners of the parent presented in the financial reports prepared on a consolidated basis.
I. When there are objective evidences of impairment, at balance sheet date, the Company considers the whole investment carrying amount as single asset, and compares its recoverable amount (value in use or fair value less costs of disposal) with the carrying amount, to test its impairment. Value in use is determined by the present value of the Company’s share of the expected future cash flow from the associates. If the recoverable amount is less than its carrying amount, an impairment loss should be recognized. The loss will not be allocated to any of the components (including goodwill), which comprise the carrying amount of the investment. An impairment loss recognized in prior periods shall be reversed if circumstances of impairment no longer exist or have decreased.

14) Property and equipment

A. Property and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized.
B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably.

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The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

C. Land is not depreciated. Other property and equipment are subsequently measured using the cost model and depreciated using the straight-line method to allocate their cost over their estimated useful lives.
D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each balance sheet date. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change. The estimated useful lives of property and equipment are as follows:

Useful lives Buildings 5~50 years Furniture and fixtures 4~10 years Computer equipment 3~5 years Electrical equipment 3~10 years Leasehold improvements 5 years

E. When an asset is sold or retired, the cost and accumulated depreciation are removed from the respective accounts and the resulting gain or loss is included in current operations.

15) Leasing arrangements (lessee) － right-of-use assets/ lease liabilities

A. Leases are recognized as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for use by the Group. For short-term leases or leases of low value assets, lease payments are recognized as an expense on a straightline basis over the lease term.
B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are mainly comprised of fixed payments.
The Group subsequently measures the lease liability at amortized cost using the interest method and recognizes interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognized as an adjustment to the right-of-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.
C. At the commencement date, the right-of-use asset is stated at cost comprising mainly the amount of the initial measurement of lease liability.

The right-of-use asset is measured subsequently using the cost model and is depreciated

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from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. When the lease liability is remeasured, the amount of remeasurement is recognized as an adjustment to the right-of-use asset.

16) Investment property

A. Investment property of the Company is the property held either to earn long-term rental income or for capital appreciation or for both.
B. Part of the property may be held by the Company for self-use purpose and the remaining are used to generate rental income or capital appreciation. If the property held by the Company can be sold individually, then the accounting treatment should be made respectively. If each part of the property cannot be sold individually and the selfuse proportion is not material, then the property is deemed as investment property in its entirety.
C. When the future economic benefit related to the investment property is highly likely to flow into the Company and the costs can be reliably measured, the investment property shall be recognized as assets. When the future economic benefit generated from subsequent costs is highly likely to flow into the entity and the costs can be reliably measured, the subsequent expenses of the assets shall be capitalized. All maintenance costs are recognized in profit or loss as incurred.
D. Investment property is subsequently measured using the cost model. Depreciated cost is used to calculate amortization expense after initial measurement. The depreciation method, remaining useful life and residual value should apply the same rules as applicable for property and equipment.

17) Intangible assets

A. The cost of computer software is amortized using the straight-line method over the useful lives based on acquisition cost, with an amortization period of 4 years.
B. In accordance with IFRS 3 ‘Business combinations’ as endorsed by FSC, goodwill arises when the acquisition cost exceeds the fair value of identifiable assets and liabilities of the consolidated subsidiary on the consolidation date. The goodwill arising from the consolidated subsidiary is included in the intangible asset. Goodwill is tested annually for impairment and any impairment loss will be recognized when impairment occurs. Impairment losses on goodwill are not reversed.
18) Impairment of non-financial assets
A. The Company assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. Except for goodwill, when the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment

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loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortized historical cost would have been if the impairment had not been recognized.

B. The recoverable amounts of goodwill, intangible assets with an indefinite useful life and intangible assets that have not yet been available for use are evaluated periodically. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. Impairment loss of goodwill previously recognized in profit or loss shall not be reversed in the following years.
C. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units, or groups of cash-generating units, that is expected to benefit from the synergies of the business combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level.

19) Financial liabilities at fair value through profit or loss

A. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of repurchasing in the short-term. Derivatives are also categorized as financial liabilities held for trading unless they are designated as hedges.
B. At initial recognition, the Group measures the financial liabilities at fair value. All related transaction costs are recognized in profit or loss. The Group subsequently measures these financial liabilities at fair value with any gain or loss recognized in profit or loss.
20) Contingent liabilities
Contingent liability is a possible obligation that arises from past event, whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company. Or it could be a present obligation as a result of past event but the payment is not probable or the amount cannot be measured reliably. The Company did not recognize any contingent liabilities but made appropriate disclosure in compliance with relevant regulations.
21) Employee benefits
A. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognized as expenses in that period when the employees render service.

B. Termination benefits

Termination benefits are employee benefits provided in exchange for the termination of employment as a result from either the Company’s decision to terminate an employee’s employment before the normal retirement date, or an employee’s decision

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to accept an offer of redundancy benefits in exchange for the termination of employee. The Company recognized expense as it can no longer withdraw an offer of termination benefit or it recognizes relating restructuring costs, whichever is earlier. Benefits that are expected to be due more than 12 months after balance sheet date shall be discounted to their present value.

C. Pensions
(A) Defined contribution plans

Effective July 1, 2005, the Company established the defined contribution plan for employees of R.O.C. nationality. The employees have the option to participate in the New Plan. Under the New Plan, the Company contributes monthly an amount equivalent to 6% of employees’ salaries to the employees’ personal pension accounts with the “Bureau of Labor Insurance”. Benefits accrued under the New Plan are portable upon termination of employment. Net defined benefit asset can only be recognized when there is a cash refund or elimination in the future accrued pension liabilities.

(B) Defined benefit plans
- a. In a defined benefit plan, the pension paid is determined based on the amount that an employee shall receive upon retirement, which could vary with age, work seniority and salary compensations. The Company recognizes the accrued pension obligations in the balance sheet based on the net amount of actuarial present value of defined benefit obligation less the fair value of fund, which is adjusted with the net of past service cost recognized as liabilities. Defined benefit obligation is assessed annually using projected unit credit method by the actuary. The present value of the defined benefit obligation is determined using the market yield of government bonds of a currency and term consistent with the currency and term of the employment benefit obligations.
- b. Remeasurement arising on defined benefit plans are recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.
D. Employees’ remuneration and directors’ remuneration

Employees’ and directors’ remuneration are recognized as expenses and liabilities, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates.

22) Revenues and expenses

The Company’s revenues and expenses mainly include:

A. Gains (losses) on sale of securities, securities brokerage fees, and commissions on brokerage and trading are recognized on the transaction date.
B. Underwriting fees and related service charges: application fees are recognized upon collection; underwriting fees and service charges are recognized when the contract is

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completed.

C. Gains (losses) on futures contracts: The margin of futures transaction is recognized as cost. Costs and expenses are recognized as incurred.
D. Operating expenses: operating expenses refer to required expenses invested in the Company’s operations, which primarily include employee benefit expense, depreciation and amortization, and other business and administrative expenses.
23) Income tax
A. Current income tax
- Income tax payable (refundable) is calculated on the basis of the tax laws enacted in the countries where a company operates and generates taxable income. Except for the transactions or other matters directly recognized in other comprehensive income or equity, in which cases the related income taxes in the period are recognized in other comprehensive income or directly derecognized from equity, all the others should be recognized as income or expense for the period.
B. Deferred income tax
- Deferred income tax assets and liabilities are measured based on the tax rate of the anticipated period that the future assets realization or the liabilities settlement requires, which is based on the effective or existing tax rate at the balance sheet date. The carrying amounts and temporary differences of assets and liabilities included in the balance sheet are calculated using the balance sheet method and recognized as deferred income tax. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit (loss). Deferred income tax assets are recognized only to the extent that it is probable that taxable profit will be available against which the deductible temporary differences can be utilized. If the future taxable income is probable to provide unused loss carryforwards or deferred income tax credit which can be realized in the future, the proportion of realization is deemed as deferred income tax asset.
C. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company operates and generates taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions for income tax liabilities where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings.
D. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts

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and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realize the asset and settle the liability simultaneously.

24) Share capital

A. Incremental costs directly attributable to the issuance of new shares are shown as a deduction, net of tax, from equity. Dividends from common stocks are recognized as equity in the financial period in which they are approved by the Company’s shareholders. If the date of dividends declared is later than the balance sheet date, common stocks are disclosed in the subsequent events.
B. Where the Company repurchases the Company’s equity share capital that has been issued, the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company’s equity holders. Where such shares are subsequently reissued, the difference between their book value and any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders.

25) Earnings per share

A. Earnings per share is calculated by dividing net income by the weighted average number of shares outstanding during the year after taking into consideration the retroactive effect of stock dividends and capital reserve capitalized.
B. When the Company calculates earnings per share, basic earnings per share and diluted earnings per share for all potential ordinary shares shall all be disclosed in accordance with IAS 33 “Earnings per share”.

5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF

ASSUMPTION UNCERTAINTY

1) As the financial statements of the Company may be affected by the adoption of accounting policy, accounting estimate and assumption, the Company’s management shall properly exercise its professional judgement, estimates, and assumptions on the information of the key risks that is obtained from other resources and could affect the carrying amounts of financial assets and liabilities in the next fiscal year while adopting critical accounting policies as stated in Note 4. Estimates and assumptions of the Company are the best estimates made in compliance with IFRSs as endorsed by the FSC. Estimates and assumptions are made based on past experience and other factors (including the influence of COVID 19) deemed relevant; however, the actual results may differ from the estimates. The Company evaluates the estimates and assumptions on an ongoing basis and recognizes

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the adjustment of the estimates only in the period which is affected by the adjustment. If the adjustment simultaneously affects both the current and future periods, it should be recognized in both periods.

2) Relevant information on key assumptions to be made in the future, key sources of assumption uncertainty made at balance sheet date, and assumptions and estimates that may cause key risks that could affect the carrying amounts of financial assets and liabilities are as follows:
A. Fair value of financial instruments
- Financial instruments with no active market or quoted price use valuation technique to determine the fair value. Under such condition, fair value is assessed through the observable information or models of similar financial instruments. If there is no observable input available in a market, the fair value of financial instrument is assessed through appropriate assumptions. When valuation models are adopted to determine the fair value, all the models should be calibrated to ensure that the output can actually reflect actual information and market price. Models should try to take only observable information as much as possible.
B. Expected credit losses
- For financial assets, the measurement of expected credit losses uses complex models and multiple assumptions. These models and assumptions take into account future macro-economic conditions and credit behaviors of borrowers (e.g. probability of customer default and loss). Please refer to Note 12(2) for detailed information on parameters, assumptions, and estimation methods used in measuring expected credit losses and disclosure of the sensitivity of credit loss to the aforementioned factors. The measurement of expected credit losses according to applicable accounting rules involves significant judgement in several areas, for example:
- (A)The criteria used to judge whether there is significant increase in credit risk.
- (B)The selection of appropriate models and assumptions for measuring expected credit losses.

For judgements and estimations of the above expected credit losses, please refer to Note 12(2).

C. Impairment assessment on investment accounted for under the equity method When there are impairment indicators that show the investments accounted for under the equity method are impaired and the carrying amount can no longer be recovered, the Company will assess the impairment of the investment. The Company assess its share of the recoverable amount which is based on the discounted value of expected cash flow, and assess the reasonableness of relevant assumptions, including revenue growth rate, operating profit margin, net profit margin, financial forecast, and discount rate.

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D. Impairment assessment of goodwill

The periodic impairment assessment of goodwill includes allocation of assets, liabilities, and goodwill to brokerage segment, and determines the recoverable amount based on brokerage segment’s present value of expected future cash flow. The periodic assessment also analyzes reasonableness of relevant assumptions, including expected future trading volumes, market share, segment’s operating profit margin, and discount rates.

6. DETAILS OF SIGNIFICANT ACCOUNTS

1) Cash and cash equivalents

rates. TAILS OF SIGNIFICANT ACCOUNTS Cash and cash equivalents
December 31,2021 Checking deposits 457,036 $ Current deposits: Deposits denominated in NTD 358,336 Deposits denominated in foreign currencies 1,001,686 Time deposits 1,265,900 Total 3,082,958 $	December 31,2020
	430,291 $ 262,276 1,057,849 1,756,700
	3,507,116 $

As of December 31, 2021 and 2020, the annual interest rates of time deposits, including foreign time deposits were 0.050% ~ 0.400% and 0.020%~0.520%, respectively.

2) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss
December 31,2021 Current items: Financial assets mandatorily measured at fair value through profit or loss: Open-ended funds, money market instruments and securities investment by brokers Open-ended mutual funds beneficiary certificates 41,726 $ Adjustment of open-ended funds, money market instruments and securities investment by brokers 307) ( Total 41,419	December 31,2020
	25,000 $ 459

	25,459

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Trading securities-dealer Listed (TSE and OTC) stocks Government bonds Corporate bonds Convertible corporate bonds Emerging stocks Overseas stocks Exchange-traded funds Unlisted stocks Subtotal Adjustment of trading securities - dealer Total Trading securities-underwriter Listed (TSE and OTC) stocks Convertible corporate bonds Subtotal Adjustment of trading securities - underwriter Total Trading securities-hedging Listed (TSE and OTC) stocks Convertible corporate bonds Warrants Overseas stocks Exchange traded funds Subtotal Adjustment of trading securities - hedging Total Options bought-futures Futures guarantee deposits receivable Derivative financial instrument assets-OTC Total Non-current items: Financial assets mandatorily measured at fair value through profit or loss: Trading securities - dealer - government bonds Unlisted stocks Subtotal Adjustment of trading securities Total	December 31,2021 6,576,248 $ 1,494,196 2,648,112 365,393 222,266 9,075,322 966,526 2,042 21,350,105 352,548 21,702,653 184,916 493,640 678,556 121,471 800,027 5,454,491 32,692 16,108 196,726 2,992 5,703,009 304,525 6,007,534 24,902 4,695,404 14,724 33,286,663 $ 49,973 $ 2,609 52,582 10,192 62,774 $	December 31,2020
		5,546,156 $ 2,699,935 3,317,423 417,025 98,366 17,628,935 2,099,505 14,714
		31,822,059 1,190,808
		33,012,867
		469,460 170,407
		639,867 49,913
		689,780
		3,535,818 20,561 52,681 - 12,084
		3,621,144 117,091
		3,738,235
		36,249
		3,319,915
		9,373
		40,831,878 $
		49,947 $ 2,609
		52,556 14,928
		67,484 $

a. For the years ended December 31, 2021 and 2020, net realized and unrealized gains on financial assets and liabilities at fair value through profit or loss amounted to $3,922,869

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and $4,393,394, respectively.

b. Details of the Company’s financial assets at fair value through profit or loss pledged to others as collateral are provided in Note 8.
c. Information relating to credit risk is provided in Note 12(2).
3) Financial assets at fair value through other comprehensive income

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December 31, 2021 December 31, 2020
Current items:
Equity instruments
Trading securities - dealer
Listed (TSE and OTC) stocks $ 189,812 $ 189,812
Adjustment of trading securities - dealer 220,393 163,698
Total $ 410,205 $ 353,510
Non-current items:
Equity instruments
Unlisted stocks $ 6,449 $ 6,449
Adjustment of trading securities 252,178 179,885
Total $ 258,627 $ 186,334
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a. The Company has elected to classify stock investments that are considered to be strategic investments or stably receiving dividends as financial assets at fair value through other comprehensive income. The fair value of such investments amounts to $668,832 and $539,844 as at December 31, 2021 and 2020.
b. For the year ended December 31, 2020, the Group sold its stock investments listed on TSE and OTC with fair value of $1,525,695, and an accumulated gain on disposal of $177,031, in order to adjust the investment position. There were no transactions for the year ended December 31, 2021
c. Amounts recognized in profit or loss and other comprehensive income in relation to the financial assets at fair value through other comprehensive income are listed below:

Equity instruments at fair value through other comprehensive income		Year ended December 31,2021		Year ended December 31,2020
Fair value change recognized in other comprehensive income Cumulative gains (losses) reclassified to retained earnings due to derecognition Dividend income recognised in profit or loss Held at end of period Derecognized during the period		128,987 $ - $ 13,661 $ - 13,661 $	369,407 $ 177,031) ($ 11,444 $ 66,894 78,338 $

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Debt instruments at fair value through other comprehensive income Fair value change recognized in other comprehensive income Cumulative other comprehensive income reclassified to profit or loss Due to derecognition Interest income recognized in profit or loss	Year ended December 31,2021 Year ended December 31,2020 - $ 100,330) ($ - $ 100,358 $ - $ 28,276 $

d. Details of the Company’s financial assets at fair value through other comprehensive income pledged to others as collateral are provided in Note 8.
e. Information relating to credit risk is provided in Note 12(2).
4) Bonds purchased under resale agreements

December 31, 2021 Overseas bonds 27,401 $	December 31,2020
	- $

The above bonds purchased under resale agreements as of December 31, 2021 and 2020 was due within one year and were contracted to be resold at the agreed-upon price plus interest charge on the specific date after transaction. The total resale amounts were $27,424 and $0, respectively. The annual interest rates of every currency were as follows:

U.S Dollar

December 31, 2021 0.3375%	December 31,2020
	-

5) Margin loans receivable

Margin loans receivable were secured by the securities purchased by customers under margin loans. The annual interest rate was 6.4%.

6) Accounts receivable

Accounts receivable
		December 31,2021			December 31,2020
Accounts receivable - related parties	$		4,792	$		4,413
Accounts receivable - non related parties
Settlement price receivable-brokers	$		14,098,544	$		14,845,933
Settlement price receivable-dealer			392,802			132,304
Accounts receivable-international bonds			137,269			4,454
Accounts receivable-foreign bonds			-			55,001
Interest receivable			336,711			244,723
Settlement price			1,349,925			2,250,253
Others			234,918			103,025
Subtotal			16,550,169			17,635,693
Less: Allowance for uncollectible accounts	(		742)	(		625)
Total	$		16,549,427	$		17,635,068

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

follows:
Accounts receivable Accounts receivable -related parties Accounts receivable - non related parties Accounts receivable Accounts receivable -related parties Accounts receivable - non related parties	Upto 30 days 4,792 $ 16,229,080 16,233,872 $	31 to 90 days	91 to 180 days 181 days to 12 months December 31,2021		More than 12 months - $ 62,892 62,892 $	Total
		- $ 48,072 48,072 $	- $ - $ 93,850 116,275 93,850 $ 116,275 $ December 31,2020			4,792 $ 16,550,169 16,554,961 $ Total 4,413 $ 17,635,693 17,640,106 $
	Upto 30 days	31 to 90 days	91 to 180 days	181 days to 12 months	More than 12 months
	4,413 $ 17,409,892 17,414,305 $	- $ 44,721 44,721 $	- $ 86,814 86,814 $	- $ 62,624 62,624 $	- $ 31,642 31,642 $

Note ： The above ageing analysis was based on invoice date.

B. Information related to credit risk is provided in Note 12(2).

7) Other receivables

Interest receivable Others Less: Impairment loss Total	December 31, 2021 December 31,2020 2,440 $ 2,392 $ 3,269 7,180 - 54) ( 5,709 $ 9,518 $

Information relating to credit risk is provided in Note 12(2).

8) Other current assets

Pending settlements Pledged time deposits Deposits-in for foreign currency securities Underwriting share proceeds collected on behalf of customers Others Total	December 31,2021 359,808 $ 400,000 1,884,425 5,243,851 104,236 7,992,320 $	December 31,2020
		427,009 $ 400,000 647,622 651,290 30,666
		2,156,587 $

9) Transfer of financial assets

A. During the Company’s activities, the transferred financial assets that do not meet derecognition conditions are mainly debt instruments with purchase agreements or debt

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instruments lent out in accordance with securities borrowing and lending agreement. The cash flow of the contract has been transferred and related liabilities of transferred financial assets that will be repurchased at a fixed price in the future have been reflected. The Company may not use, sell or pledge the transferred financial assets during the valid period of the transaction. The financial assets were not derecognized as the Company is still exposed to interest rate risk and credit risk.

B. Financial assets that do not meet the derecognition conditions and related financial
liabilities are analysed below:

December 31, 2021

Financial assets category Carrying amount of transferred financial assets Financial assets measured at fair value through profit or loss Repurchase agreement 10,016,623 $ December 31,2020	Carrying amount of transferred financial assets	Carrying amount of related financial liabilities
		9,643,040 $ Carrying amount of related financial liabilities
Financial assets category Financial assets measured at fair value through profit or loss Repurchase agreement	Carrying amount of transferred financial assets
	20,375,875 $	19,096,165 $

10) Offsetting financial assets and financial liabilities
A. The Company has transactions that are or are similar to net settled master netting arrangements but do not meet the offsetting criteria, i.e. derivative financial instruments, resale and repurchase agreements. If one party breaches the contract, the counterparty can choose to use net settlement for the above transactions.

(Blank below)

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B. The offsetting of financial assets and financial liabilities are set as follows:

(1) Financial assets

December 31, 2021

			December 31,2021	December 31,2021	December 31,2021
Derivative financial instruments Bonds purchased under resale agreements Total Financial Description Financial	14,257 $ 27,401 41,658 $ assets that are offset,or ca Gross amounts of recognised financial assets assets that are offset,or ca	n	Financial instruments Cash collateral received - $ 14,257 $ 2,467 $ - $ - 27,401 27,334 - - $ 41,658 $ 29,801 $ - $ be settled under agreements of net settled master nettingarrangements or similar arrangements Gross amounts of recognised financial liabilities set off in the balance sheet Net amounts of financial assets presented in the balance sheet Not set off in the balance sheet December 31, 2020 be settled under agreements of net settled master nettingarrangements or similar arrangements			Net amount
		n				11,790 $ 67
						11,857 $

Derivative financial instruments Description	Gross amounts of recognised financial assets		Gross amounts of recognised financial liabilities set off in the balance sheet	Net amounts of financial assets presented in the balance sheet	Financial instruments Cash collateral received 9,303 $ - $ Not set off in the balance sheet	Net amount
					Financial instruments
	9,303 $		- $	9,303 $	9,303 $	- $

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(2) Financial liabilities

December 31, 2021

Financial liabilities that are offset, or can be settled under agreements of net settled master netting arrangements or similar arrangements

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Not set off in the balance sheet
Gross amounts of Gross amounts of recognised Net amounts of financial
recognised financial financial assets set off in the liabilities presented in the Financial Cash collateral
Description liabilities balance sheet balance sheet instruments received Net amount
Derivative financial instruments $ 2,467 $ - $ 2,467 $ 2,467 $ - $ -
Bonds sold and repurchase
agreements 6,598,995 - 6,598,995 6,598,995 - -
Total $ 6,601,462 $ - $ 6,601,462 $ 6,601,462 $ - $ -
December 31, 2020
Financial liabilities that are offset, or can be settled under agreements of net settled master netting arrangements or similar arrangements
Gross amounts of Gross amounts of recognised Net amounts of financial Not set off in the balance sheet
recognised financial financial assets set off in the liabilities presented in the Financial Cash collateral
Description liabilities balance sheet balance sheet instruments received Net amount
Derivative financial instruments $ 26,252 $ - $ 26,252 $ 9,303 $ - $ 16,949
Bonds sold and repurchase
agreements 14,051,616 - 14,051,616 14,051,616 - -
Total $ 14,077,868 $ - $ 14,077,868 $ 14,060,919 $ - $ 16,949
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11) Investments accounted for under the equity method

Subsidiaries President Futures Corp. President Securities (HK) Ltd. President Wealth Management (HK) Ltd. President Securities (Nominee) Ltd. President Capital Management Corp. President Insurance Agency Corp. PSC Venture Capital Investment Limited Company Associates Uni-President Asset Management Corp. Jin Yuan President Securities Co.,Ltd.	December 31,2021 2,420,110 $ 1,288,431 54,073 1,529 312,175 46,249 273,064 4,395,631 760,171 2,363,197 7,518,999 $	December 31,2020 2,102,027 $ 1,361,333 56,002 1,672 320,169 29,698 242,139
		4,113,040
		602,375 2,531,901
		7,247,316 $

A. The Company’s share of its associates’ profits or losses recognized in long-term equity investment accounted for under the equity method for the years ended December 31, 2021 and 2020 were $213,779 and $303,699, respectively.
B. The Group holds 42.46% of the equity of Uni-President Asset Management Corp., making it the single largest shareholder of the company, while the other equity is mainly held by the other 15 shareholders. Half of the voting rights of the shareholders attending the shareholders’ meeting exceeds the voting rights of the Group, and the Group does not take an active role in the management of the company. This shows that the Group has no actual ability to direct relevant activities. The Group has no control over Uni-President Asset Management Corp., but has significant influence over it.
C. Details of information of subsidiaries are provided in Note 4(3) of consolidated financial statements.
D. The financial information of the Company’s principal associates is summarized as follows: (a)The basic information of the associate that are material to the Company is as follows:

Princial place Companyname of businesss Uni-President Asset Management Corp. Taipei city Jin Yuan President Securities Co.,Ltd. (Note) Xiamen	December 31, 2021 December 31, 2020 42.46% 42.46% 49% 49% Shareholdingratio	Nature of relationship Associate Associate	Methods of measurement
			Equity method Equity method
	42.46% 49%

Note: The Company participated in the establishment of Jin Yuan President Securities Co., Ltd. since May 2020.

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(b)The summarized financial information of the associate that are material to the Company is as follows:

Balance sheet

Balance sheet
		Uni-President Asset	Management Corp.
	December 31,2021		December	31,2020
Current assets	$	1,105,200	$	656,152
Non-current assets		761,113		687,024
Current liabilities	(	433,586)	(	292,750)
Non-current liabilities	(	64,962)	(	54,266)
Total net assets	$	1,367,765	$	996,160
Share in associte's net assets	$	580,799	$	423,003
Goodwill and others		179,372		179,372
Carrying amount of the associate	$	760,171	$	602,375

Balance sheet

Balance sheet
		Jin Yuan President	Securities	Co.,Ltd.
	December 31, 2021		December 31,2020
Current assets	$	8,438,646	$	5,083,846
Non-current assets		317,940		174,020
Current liabilities	(	3,852,030)	(	85,687)
Non-current liabilities	(	81,706)	(	5,034)
Total net assets	$	4,822,850	$	5,167,145
Share in associte's net assets	$	2,363,197	$	2,531,901
Carrying amount of the associate	$	2,363,197	$	2,531,901

Statement of comprehensive income

Statement of comprehensive income
Revenue Profit for the period from continuing operations Other comprehensive income- net of tax Total comprehensive income Dividends received from associates		Year ended December 31,2021 Year ended December 31, 2020 1,411,480 $ 941,595 $ 536,134 $ 258,096 $ 68,517 20,871 604,651 $ 278,967 $ 98,959 $ 94,466 $ Uni-President Asset Management Corp.
			941,595 $ 258,096 $ 20,871 278,967 $ 94,466 $

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Statement of comprehensive income

Revenue Loss for the period from continuing operations Total comprehensive loss

Jin Yuan President	Eight months ended December 31,2020 Securities Co.,Ltd.
Year ended December 31,2021
291,581 $ 305,071) $ 305,071) $	74,454 $ 83,388) ($ 83,388) ($

12) Property and equipment

January1				2021
	Land	Buildings		Equipment	Leasehold improvements		Total
Cost Accumulated depreciation and impairment Total January 1 Additions Reclassifications Depreciation December 31, 2021 December 31,2021	1,573,570 $ - 1,573,570 $ 1,573,570 $ - - - 1,573,570 $ Land	1,010,840 $ 421,494) ( 589,346 $ 589,346 $ 630 12,329 30,719) ( 571,586 $ Buildings		180,060 $ 83,200) ( 96,860 $ 96,860 $ 45,694 19,180 43,107) ( 118,627 $ Equipment	22,293 $ 11,747) ( 10,546 $ 10,546 $ 405 750 4,214) ( 7,487 $ Leasehold improvements		2,786,763 $ 516,441) ( 2,270,322 $ 2,270,322 $ 46,729 32,259 78,040) ( 2,271,270 $ Total
Cost Accumulated depreciation and impairment Total January1	1,573,570 $ - 1,573,570 $	1,022,169 $ 450,583) ( 571,586 $		212,540 $ 93,913) ( 118,627 $ 2020	17,818 $ 10,331) ( 7,487 $		2,826,097 $ 554,827) ( 2,271,270 $
	Land		Buildings	Equipment		Leasehold improvements		Total
Cost Accumulated depreciation and impairment Total January 1 Additions Disposal Reclassification Depreciation December 31, 2020 December 31,2020	1,573,570 $ - 1,573,570 $ 1,573,570 $ - - - - 1,573,570 $ Land	980,799 $ 397,833) ( 582,966 $ 582,966 $ 1,340 - 32,076 27,036) ( 589,346 $ Buildings		158,227 $ 60,690) ( 97,537 $ 97,537 $ 22,397 13) ( 14,436 37,497) ( 96,860 $ Equipment	31,424 $ 15,106) ( 16,318 $ 16,318 $ 253 - - 6,025) ( 10,546 $ Leasehold improvements		2,744,020 $ 473,629) ( 2,270,391 $ 2,270,391 $ 23,990 13) ( 46,512 70,558) ( 2,270,322 $ Total
Cost Accumulated depreciation and impairment Total	1,573,570 $ - 1,573,570 $	1,010,840 $ 421,494) ( 589,346 $		180,060 $ 83,200) ( 96,860 $	22,293 $ 11,747) ( 10,546 $		2,786,763 $ 516,441) ( 2,270,322 $

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A. No interest was capitalized for property and equipment for the years ended December 31, 2021 and 2020.
B. The information on property and equipment pledged or restricted as of December 31, 2021 and 2020 is described in Note 8.
－
13) Leasing arrangements lessee
A. The Company leases various assets including buildings, machinery and equipment, business vehicles and multifunction printers. Rental contracts are typically made for periods of 1 to 10 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 used as security for borrowing purposes.
B. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Buildings Transportation equipment (Business vehicles) Office equipment (Photocopiers) Total Buildings Transportation equipment (Business vehicles) Office equipment (Photocopiers) Total		December 31,2021 CarryingAmount 168,610 $ 15,976 7,374 191,960 $ Year ended December 31,2021 Depreciation charge 63,091 $ 5,557 2,100 70,748 $	December 31, 2020 Carrying Amount 147,180 $ 15,283 9,118 171,581 $ Year ended December 31, 2020
			Depreciation charge 63,380 $ 5,258 1,198 69,836 $

C. For the years ended December 31, 2021 and 2020, the additions to right-of-use assets amounted to $91,685 and $73,910, respectively.
D. The information on income and expense accounts relating to lease contracts is as follows:

Items affecting profit or loss Interest expense on lease liabilities Expense on short-term lease contracts Expense on variable lease payment	Year ended December 31,2021	Year ended December 31,2020
	1,186 $ 1,651 3,485	1,301 $ 3,264 224

E. For the years ended December 31, 2021 and 2020, the Company’s total cash outflow for leases amounted to $70,881 and $71,243, respectively.
F. The Company has applied the practical expedient to “Covid-19-related rent concessions” and recognized the other gains or losses from changes in lease payments arising from the rent concessions amounting to $104 and $116 by decreasing rent expense for the years ended

209

December 31, 2021 and 2020.

14) Leasing arrangements – lessor

A. The Company leases various assets including office and parking space. Rental contracts are typically made for periods of 1 and 5 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.
B. For the years ended December 31, 2021 and 2020, the Company recognized rent income in the amount of $24,512 and $25,288, based on the operating lease agreement, which does not include variable lease payments.
C. The maturity analysis of the lease payments under the operating leases is as follows:

2021 2022 2023 2024 Total	December 31,2021 - $ 23,655 29,695 6,077 59,427 $	December 31,2020
		23,557 $ 23,187 23,133 5,960 75,837 $

15) Investment property

Investment property
January1 Cost Accumulated depreciation and impairment Total January 1 Depreciation December 31 December 31 Cost Accumulated depreciation and impairment Total		2021
	Land Buildings Total 198,099 $ 107,076 $ 305,175 $ - 34,672) ( 34,672) ( 198,099 $ 72,404 $ 270,503 $ 198,099 $ 72,404 $ 270,503 $ - 2,101) ( 2,101) ( 198,099 $ 70,303 $ 268,402 $ Land Buildings Total 198,099 $ 107,076 $ 305,175 $ - 36,773) ( 36,773) ( 198,099 $ 70,303 $ 268,402 $

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

2020
January 1 Land Buildings Total
Cost $ 198,099 $ 107,076 $ 305,175
Accumulated depreciation
and impairment - ( 32,572) ( 32,572)
Total $ 198,099 $ 74,504 $ 272,603
January 1 $ 198,099 $ 74,504 $ 272,603
-
Depreciation ( 2,100) ( 2,100)
December 31 $ 198,099 $ 72,404 $ 270,503
December 31 Land Buildings Total
Cost $ 198,099 $ 107,076 $ 305,175
Accumulated depreciation
-
and impairment ( 34,672) ( 34,672)
Total $ 198,099 $ 72,404 $ 270,503
----- End of picture text -----

A. For the years ended December 31, 2021 and 2020, rental income from the lease of the investment property were $17,115 and $16,570, respectively, and direct operating expenses arising from the investment property were $3,579 and $3,864, respectively.

B. Details of fair value of investment property are provided in Note 12(5).

16) Intangible assets

2021

January1 Computer software Cost 75,854 $ Accumulated depreciation and impairment 23,458) ( Total 52,396 $ January 1 52,396 $ Additions 41,381 Reclassifications 34,506 Depreciation 24,658) ( December 31 103,625 $ December 31 Computer software Cost 146,948 $ Accumulated depreciation and impairment 43,323) ( Total 103,625 $		Goodwill	Customer relationships and others Total 54,260 $ 172,118 $ 54,181) ( 77,639) ( 79 $ 94,479 $ 79 $ 94,479 $ - 41,381 - 34,506 18) ( 24,676) ( 61 $ 145,690 $ Customer relationships and others Total 54,260 $ 243,212 $ 54,199) ( 97,522) ( 61 $ 145,690 $
		42,004 $ - 42,004 $ 42,004 $ - - - 42,004 $ Goodwill
		42,004 $ - 42,004 $

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2020

January1 Computer sofware Cost 44,326 $ Accumulated depreciation and impairment 15,701) ( Total 28,625 $ January 1 28,625 $ Additions 10,032 Reclassifications 28,632 Depreciation 14,893) ( December 31 52,396 $ December 31 Computer software Cost 75,854 $ Accumulated depreciation and impairment 23,458) ( Total 52,396 $		Goodwill	Customer relationships and others Total 54,260 $ 140,590 $ 54,163) ( 69,864) ( 97 $ 70,726 $ 97 $ 70,726 $ - 10,032 - 28,632 18) ( 14,911) ( 79 $ 94,479 $ Customer relationships and others Total 54,260 $ 172,118 $ 54,181) ( 77,639) ( 79 $ 94,479 $
		42,004 $ - 42,004 $ 42,004 $ - - - 42,004 $ Goodwill
		42,004 $ - 42,004 $

A. No interest was capitalized for intangible assets for the years ended December 31, 2021 and 2020.
B. Goodwill and customer relationships were acquired through acceptance of transfer of the securities brokerage business of Standard Chartered (Taiwan) Bank's retail banking business and were all allocated to the Company’s brokerage segment.
C. The recoverable amount of goodwill was determined based on its value in use. Calculations of value in use after-tax cash flow projections are based on financial budgets approved by the management covering a five-year period. Cash flows beyond the five-year period are extrapolated using the estimated growth rates stated below.

The recoverable amount calculated based on the value in use exceeded the carrying amount, thus the goodwill was not impaired. The key assumptions used for calculation of value in use are as follows:

of value in use are as follows:
Growth rate Discount rate	Brokerage	2020 0.00% 9.79% Segment
	2021 0.00% 12.03%

Management determined the growth rate based on past performance and its expectations of market development. The discount rates were based on the weighted average financing cost rates determined by the Company’s capital asset pricing model. The discount rates also reflect specific risks related to relevant operating segments.

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17) Other non-current assets

18)
19)
20)

Short-term loans
Commercial papers payable
Financial liabilities at fair value through profit or loss-current
December 31,2021
December 31,2020
Operation guaranteed deposits
505,000
$ 505,000
$ Clearing and settlement fund
230,091

243,407
Refundable deposits
301,574

257,611
Net defined benefit assets
-

16,688
Prepayment for equipment
78,273

21,063
Overdue receivables
12,517
39,388

Others
2,500
720

Subtotal
1,129,955

1,083,877

Less: Allowance for uncollectible
accounts-overdue receivables
12,517)
(
39,388)
(
Total
1,117,438
$ 1,044,489
$ December 31, 2021
December 31, 2020
Unsecured loans
590,000
$ 578,976
$ Interest rates
0.790%
0.590%~0.700%
December 31,2021
December 31, 2020
Face value
8,650,000
$ 7,300,000
$ Less: discount on commercial papers payable
1,442)
(
1,104)
(
Total
8,648,558
$ 7,298,896
$ Interest rates
0.320%~0.500%
0.200%~0.340%
December 31,2021
December 31,2020
Investments in bonds under resale
agreements - short sales
148,560
$ -
$ Valuation adjustment of financial assets held
for trading
270)
(
-
Subtotal
148,290
-
Liabilities on sale of borrowed securities
- hedged
408,629
243,446
Valuation adjustment on liabilities on sale of
borrowed securities - hedged
16,664
28,741
Liabilities on sale of borrowed securities
- non-hedged
4,294,538
688,401
Valuation adjustment on liabilities on sale of
borrowed securities - non-hedged
404,442
79,206
Subtotal
5,124,273
1,039,794

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		December 31,2021	December 31,2021		December 31,2020
Issuance of call ( put ) warrants	$		12,925,747	$	10,937,977
Gain on price fluctuation	(		500,708)	(	912,291)
Market value (A)			12,425,039		10,025,686
Warrants redeemed	(		12,258,180)	(	9,807,568)
Loss on price fluctuation			729,365		461,682
Market value (B)	(		11,528,815)	(	9,345,886)
Warrants - net (A+B)			896,224		679,800
Options sold - TAIFEX			7,162		15,405
Outstanding Liability for Issuance of ETNs			1,678,161		683,685
Valuation adjustment on outstanding Liability for
Issuance of ETNs	(		106,307)		52,029
Subtotal			1,571,854		735,714
Derivative financial liabilities - OTC			423,932		151,428
Total		$	8,171,735	$	2,622,141

Among the warrants issued by the Company, except for contract-based warrants which are Europeanstyle warrants, all other warrants are American-style warrants. Warrants are stated as liabilities for issuance of warrants at issuance price prior to expiration. Upon repurchase of warrants after issuance, the repurchased amounts are recognized as warrants repurchase and charged as a deduction to liabilities for issuance of warrants. The warrants have six to twelve months exercise period from the date of issuance. The issuer has the option to settle either by cash or stock delivery.

21) Bonds sold under repurchase agreements

Bonds sold under repurchase agreements
December 31, 2021 Government bonds 1,623,147 $ Corporate bonds 500,119 Bank debentures 300,000 International bonds 620,779 Foreign bonds 6,598,995 Total 9,643,040 $	December 31,2020
	2,856,072 $ 951,350 200,000 1,037,127 14,051,616
	19,096,165 $

The above bonds sold under repurchase agreements as of December 31, 2021 and 2020 were due within one year and were contracted to be repurchased at the agreed-upon price plus interest charge on the specific date after the transaction. The total repurchase amounts were $9,648,756 and $19,112,268, respectively, and the annual interest rates in every currency were shown as follows:

Currency December 31, 2021 December 31, 2020 NTD 0.17%~0.32% 0.17%~0.26% Foreign currencies (Note) -0.70%~3.61% -0.40%~3.10% (Note) ： Foreign currencies include AUD, EUR, USD, GBP, RMB and SGD.

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22) Accounts payable

22)	Accounts payable
23) 24)	Other payables Other financial liabilities-current Settlement accounts payable - brokered trading Settlement proceeds Settlement accounts payable - operating Accounts payable - international bonds Accounts payable - foreign bonds Spot exchange payable, foreign currencies Others Total Salary and bonus payable Employees’and directors’remuneration payable Others Total Equity-linked notes (ELN) - Options Principal guaranteed notes (PGN) - fixed income Total	December 31,2021 14,823,110 $ 776,513 1,404,454 - 121,943 - 295,479 17,421,499 $ December 31,2021 1,613,645 $ 189,496 696,707 2,499,848 $ December 31, 2021 84,000 $ 4,899,139 4,983,139 $	December 31,2020
			16,849,132 $ 471,589 513,165 27,575 14,454 54,719 107,485
			18,038,119 $
			December 31, 2020
			1,228,688 $ 163,608 582,943
			1,975,239 $
			December31,2020
			17,000 $ 5,991,310
			6,008,310 $

The Company deals in equity-linked products and combines fixed income instruments with call or put options. These products are categorized into ELN (Equity-Linked Notes) and PGN (Principal Guaranteed Notes). On trade date, the contracted amounts are collected in full from the counterparties. The payout amount on maturity will depend on the price fluctuation of the instruments linked to these contracts and be calculated as trading price less option strike price on maturity. All the linked products are financial instruments under the supervision of the SFB (Securities and Futures Bureau).

25) Other liabilities-non-current

Other liabilities-non-current
Guarantee deposits received Net defined benefit liabilities - non-current Total	December31,2021 23,419 $ 58,331 81,750 $	December31,2020
		24,388 $ -
		24,388 $

26) Pension plan

A. Defined benefit plans

(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. 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.

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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. The Company contributes monthly an amount which ranges between 2.0% and 7.2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the supervisory committee of workers' retirement reserve fund, and with Cathay United Bank, under the name of the management committee of employees’ retirement fund. Also, the Company would assess the balance in the aforementioned labor pension reserve account by the end of December 31, every year. If the account balance is insufficient to pay the pension calculated by the aforementioned method, to the employees expected to be qualified for retirement next year, the Company will make contributions to cover the deficit by next March.

(B)The amounts recognized in the balance sheet are determined as follows:

pension reserve account by the end of December 31, every year. If the account balance is nsufficient to pay the pension calculated by the aforementioned method, to the employees xpected to be qualified for retirement next year, the Company will make contributions to cover he deficit by next March. The amounts recognized in the balance sheet are determined as follows:	pension reserve account by the end of December 31, every year. If the account balance is nsufficient to pay the pension calculated by the aforementioned method, to the employees xpected to be qualified for retirement next year, the Company will make contributions to cover he deficit by next March. The amounts recognized in the balance sheet are determined as follows:	pension reserve account by the end of December 31, every year. If the account balance is nsufficient to pay the pension calculated by the aforementioned method, to the employees xpected to be qualified for retirement next year, the Company will make contributions to cover he deficit by next March. The amounts recognized in the balance sheet are determined as follows:	pension reserve account by the end of December 31, every year. If the account balance is nsufficient to pay the pension calculated by the aforementioned method, to the employees xpected to be qualified for retirement next year, the Company will make contributions to cover he deficit by next March. The amounts recognized in the balance sheet are determined as follows:
Movements in net defined benefit liabilities (assets) are as follows: December 31, 2021 December 31, 2020 Present value of defined benefit obligations 815,551 $ 795,455 $ Fair value of plan assets 757,220) ( 812,143) ( Net defined benefit (assets) liabilities 58,331 $ 16,688) ($ Present value of defined benefit obligations Fair value ofplan assets Net defined benefit liabilities (assets) Year ended December 31,2021 Balance at January 1 795,455 $ 812,143) ($ 16,688) ($ Current service cost 3,950 - 3,950 Interest expense (income) 2,386 2,436) ( 50) ( 801,791 814,579) ( 12,788) ( Remeasurements: Return on plan assets (excluding amounts included in interest income or expense) - 8,438) ( 8,438) ( Change in demographic assumptions 693 - 693 Change in financial assumptions 13,059) ( - 13,059) ( Experience adjustments 148,130 - 148,130 135,764 8,438) ( 127,326 Pension fund contribution - 56,207) ( 56,207) ( Paid pension 122,004) ( 122,004 - 122,004) ( 65,797 56,207) ( Balance at December 31 815,551 $ 757,220) ($ 58,331 $
	795,455 $ 3,950 2,386 801,791 - 693 13,059) ( 148,130 135,764 - 122,004) ( 122,004) ( 815,551 $	812,143) ($ - 2,436) ( 814,579) ( 8,438) ( - - - 8,438) ( 56,207) ( 122,004 65,797 757,220) ($	16,688) ($ 3,950 50) ( 12,788) ( 8,438) ( 693 13,059) ( 148,130 127,326 56,207) ( - 56,207) ( 58,331 $
Balance at January 1 Current service cost Interest expense (income) Remeasurements: Return on plan assets (excluding amounts included in interest income or expense) Change in demographic assumptions Change in financial assumptions Experience adjustments Pension fund contribution Paid pension Balance at December 31

(C)Movements in net defined benefit liabilities (assets) are as follows:

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Present value of defined benefit obligations Year ended December 31,2020 Balance at January 1 819,706 $ Current service cost 4,678 Interest expense (income) 5,738 830,122 Remeasurements: Return on plan assets (excluding amounts included in interest income or expense) - Change in financial assumptions 26,308 Experience adjustments 3,356 29,664 Pension fund contribution - Paid pension 64,331) ( 64,331) ( Balance at December 31 795,455 $	Fair value ofplan assets		Net defined benefit liabilities (assets)
	818,119) ($ - 5,727) ( 823,846) ( 9,506) ( - - 9,506) ( 43,122) ( 64,331 21,209 812,143) ($	1,587 $ 4,678 11 6,276 9,506) ( 26,308 3,356 20,158 43,122) ( - 43,122) ( 16,688) ($

(D)The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined benefit pension plan in accordance with the Fund’s annual investment and utilization plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund” (Article 6: The scope of utilization for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-the-counter, or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilization of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. If the earnings is less than aforementioned rates, government shall make payment for the deficit after being authorized by the Regulator. The Company has no right to participate in managing and operating that fund and hence the Company is unable to disclose the classification of plan asset fair value in accordance with IAS 19 paragraph 142. The composition of fair value of plan assets as of December 31, 2021 and 2020 is given in the Annual Labor Retirement Fund Utilization Report published by the government. In addition, for retirement fund deposits with Cathay United Bank, under the name of the management committee of employees’ retirement fund, the fund invests in time deposit accounts under Cathay United Bank.

(E) The principal actuarial assumptions used were as follows:

Discount rate Future salary increases		Year ended December 31,2021		Year ended December 31,2020
		0.50% 2.50%		0.30% 2.50%

Assumptions regarding future mortality rate are set based on the Taiwan Standard Ordinary Experience Mortality Table (2021 and 2011) for the years ended December 31, 2021 and 2020.

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Because the main actuarial assumption changed, the present value of defined benefit obligation is affected. The analysis was as follows:

==> picture [463 x 155] intentionally omitted <==

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

Discount rate Future salary increases
Increase 0.25% Decrease 0.25% Increase 0.25% Decrease 0.25%
December 31, 2021
Effect on present value
of defined benefit
obligation ($ 15,953) $ 16,424 $ 14,065 ($ 13,757)
December 31, 2020
Effect on present value
of defined benefit
obligation ($ 16,592) $ 17,108 $ 14,741 ($ 14,399)
----- End of picture text -----

(F) Expected contributions to the defined benefit pension plans of the Company for the year ending December 31, 2022 amounts to $55,151.

B. Defined contribution plans:

Effective from July 1, 2005, the Company established a defined contribution plan pursuant to the “Labor Pension Act”, which covers employees with R.O.C. nationality and those who chose or are required to apply the “Labor Pension Act”. The contributions are made monthly based on not less than 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The payment of pension benefits is based on the employees’ individual pension fund accounts and the cumulative profit in such accounts. The employees can choose to receive such pension benefits monthly or in lump sum. The pension costs under defined contribution pension plans of the Company for the years ended December 31, 2021 and 2020 were $74,179 and $62,258, respectively.

27) Equity

A. Common stock

As of December 31, 2021, the Company’s authorized capital was $15,000,000 with a par value of $10 (in dollars) per share. As of December 31, 2021 and 2020, the common stocks issued and the outstanding common stocks were 1,455,831 and 1,399,838 thousand shares, respectively. Movements in the number of the Company’s ordinary shares outstanding are as follows:

(Expressed in thousands)

January 1 Purchase and retirement of treasury shares December 31		Year ended December 31,2021		Year ended December 31,2020
		1,399,838 55,993 1,455,831		1,372,390 27,448 1,399,838

The Board of Directors approved on March 23, 2021 and the shareholders' meeting resolved on July 20, 2021 to increase the Company’s capital with an undistributed surplus of $559,935, and issue 55,993 thousand ordinary shares with a par value of $10 (in dollars) per share. The record date of the capital increase is September 1, 2021, the total issued share capital after the capital increase was $14,558,313, divided into 1,455,831 thousand shares, each with a par value of $10 (in dollars) per share.

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B. Capital reserve

December 31, 2021 December 31, 2020	Share premium Treasury share transactions Expired stock options Difference between consideration and carrying amount of subsidiaries acquired or disposed 24,663 $ 65,675 $ 483 $ 440 $ 24,663 $ 65,675 $ 483 $ 440 $	Total 91,261 $ 91,261 $

Pursuant to the R.O.C. Company Law, capital reserve 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 it should not exceed 10% of the paid-in capital each year. Capital reserve should not be used to cover accumulated deficit unless the legal reserve is insufficient.

C. Legal reserve

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

D. Special reserve

In accordance with the “Rules Governing the Administration of Securities Firms”, 20% of the current year's earnings, after paying all taxes and offsetting prior years' operating losses and plus the items other than the after-tax net profit for the period, that are included in the unappropriated earnings of the period, if any, shall be set aside as special reserve until the cumulative balance equals the total amount of paid-in capital. The special reserve shall be used exclusively to cover accumulated deficit or to increase capital and shall not be used for any other purpose. Such capitalization shall not be permitted unless the Company had already accumulated a special reserve of at least 25% of its paid-in capital stock and only quarter of such special reserve may be capitalized.

In accordance with the regulations, the Company shall set aside an equivalent amount of special reserve from accumulated unappropriated retained earnings of the current year based on the decreased amount of equity. If there is any subsequent reversal of the decrease in equity, the earnings may be distributed based on the reversal proportion.

In accordance with Jing-Guan-Zheng-Chuan Letter No. 10500278285 dated August 5, 2016, securities firms should set aside 0.5% to 1% of net income after tax as special reserve, upon the distribution of earnings from 2016 to 2018. From fiscal year 2017, special reserve as mentioned above may be reversed based on an amount equal to employees’ transformation training expenditure, employee transfer and settlement expenditure arising from the development of Fintech. Further, according to Jing-Guan-Zheng-Chuan Letter No. 1080321644 dated July 10, 2019, securities firms are no longer required to set aside special reserve starting from 2019. And the special reserve, within the balance of special reserve set aside in the previous years, could be reversed at the same amount for the aforementioned expenditures.

28) Unappropriated earnings and dividends policy
A. Under the Company’s Articles of Incorporation, the current year’s earnings, if any, shall be used to pay all taxes and offset prior years’ operating losses first, and then set aside as legal reserve,

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accounted for as 10% of the remaining amount, and special reserve, accounted for as 20% of the remaining amount. Upon provision or reversal of special reserve in accordance with the law, any remaining amount together with unappropriated earnings at beginning of the period shall be distributed according to the following resolution adopted at the stockholders’ meeting: Distribution shall not be made if the balance of distributable earnings is less than 5% of paid-in capital.

B. In addition, the total amount of dividends declared every year shall be at least 70% of distributable earnings, of which stock dividends shall be at least 50% and cash dividends shall be lower than 50%.
C. The Company may determine a better proportion of cash and stock dividends distribution based on its actual operating conditions and capital utilization plan for the following year.
D. The earnings distribution for 2020 as resolved by the Board of Directors on July 20, 2021 ; the appropriation of 2019 earnings was resolved by the shareholders on June 19, 2020. Details are as follows:

follows:
Legal reserve Special reserve Reversal of special reserve (Note) Cash dividends Stock dividends Total	For the year ended December 31,2020	For the year ended December 31,2019
	Amount Dividends per share (in dollars) 376,735 $ 721,503 7,620) ( 2,099,757 1.50 $ 559,935 0.40 3,750,310 $	Amount	Dividends per share (in dollars)
		234,244 $ 473,707 4,221) ( 1,372,390 274,478 2,350,598 $	1.00 $ 0.20

Note ： Special reserve was provided for employees’ transition for financial technology development according to Jing-Guan-Zheng-Chuan Letter No. 1080321644 and can be reversed for employees’ transition.
E. The earnings distribution for 2021 as resolved by the Board of Directors on March 8, 2022 is set forth below:

forth below:
Legal reserve Special reserve Reversal of special reserve (Note) Cash dividends Total	For theyear ended December 31,2021
	Amount	Dividends per share(in dollars)
	390,101 $ 780,203 3,413) ( 2,751,521 3,918,412 $	1.89 $

Note ： Special reserve was provided for employees’ transition for financial technology development according to Jing-Guan-Zheng-Chuan Letter No. 1080321644 and can be reversed for employees’ transition.

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29) Brokerage handling fee revenue

Brokerage handling fee revenue
		Year ended		Year ended
	December 31, 2021		December 31, 2020
Revenues from brokered trading - TWSE	$	3,161,596	$	1,787,358
Revenues from brokered trading - OTC		880,732		617,121
Others		111,288		61,043
Total	$	4,153,616	$	2,465,522

30) Revenues from underwriting business

Revenues from underwriting business
Year ended December 31,2021 Revenues from underwriting securities on a firm commitment basis 61,104 $ Others 42,931 Total 104,035 $		Year ended December 31,2020
		25,222 $ 51,284 76,506 $

31) Net gain (loss) on sale of trading securities

Net gain (loss) on sale of trading securities
Dealers: -TAIEX -OTC -Overseas trading Subtotal Underwriters: -TAIEX -OTC Subtotal Hedging: -TAIEX -OTC -Overseas trading Subtotal Total	Year ended December 31,2021		Year ended December 31,2020
	4,188,156 $ 482,933 183,444) ( 4,487,645 20,564 135,272 155,836 3,998,363 68,918 28,210 4,095,491 8,738,972 $		1,745,296 $ 32,375 1,233,469 3,011,140 59,566 65,373 124,939 159,062 53,329 3,280 215,671 3,351,750 $

32) Interest revenue

nterest revenue
Interest income from margin loans Interest income from bonds Others Total		Year ended December 31,2021		Year ended December 31,2020
		853,325 $ 274,506 31,379 1,159,210 $		502,286 $ 535,601 14,708 1,052,595 $

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33) Net valuation gain (loss) on trading securities at fair value through profit or loss

		Year ended		Year ended
	December 31, 2021		December 31, 2020
Gain (loss) on sale of securities - dealer	($	1,121,672)	$	1,014,047
Gain (loss) on sale of securities - underwriting		71,558	(	51,505)
Gain (loss) on sale of securities - hedging		187,434		33,077
Total	($	862,680)	$	995,619

34) Net gain (loss) on covering of borrowed securities and bonds with resale agreements - short sales

Gain (loss) from the bond investments under resale agreements Gain (loss) from securities borrowing transactions Gain (loss) from covering Total	Year ended December 31,2021 Year ended December 31, 2020 ($ 1,270) ($ 5,861) ( 217,126) 262,525 36,503 11,775 181,893) ($ 268,439 $

35) Net valuation gain (loss) on borrowed securities and bonds with resale agreements-short sales at fair value through profit or loss

value through profit or loss
Year ended December 31, 2021 Valuation gain (loss) from securities borrowing transactions 325,247) ($ Valuation gain (loss) from covering 12,088 Total 313,159) ($	Year ended December 31,2020
	92,093) ($ 24,928) ( 117,021) ($

	Total (	313,159) $	117,021) ($
36) 37)	Net realised gain (loss) on financial assets measured	at fair value through	other comprehensive
	income Net gain (loss) from issuance of call (put) warrants Foreign bonds Net gain (loss) on changes in fair value of call (put) warrant liabilities and redemption Net gain (loss) on exercise of call (put) warrants before maturity Expenses arising out of issuance of call (put) warrants Total		Year ended December 31, 2020
			100,358 $ Year ended December 31,2020
			367,407 $ 114,508) ( 157,494) ( 95,405 $

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38) Net gain (loss) from derivatives

Net gain (loss) from derivatives
			Year ended		Year ended
		December 31, 2021		December 31, 2020
Futures contract gain (loss)	$		389,911	$	265,861
Option trading gain (loss)	(		161,788)	(	159,758)
OTC option trading gain (loss)	(		924,981)	(	145,089)
Net gain (loss) on foreign exchange derivatives			83,242	(	43,196)
Others	(		41,690)	(	38,335)
Total	($		655,306)	($	120,517)

39) Impairment loss and reversal of impairment gain

Impairment loss and reversal of impairment gain
Other operating income Impairment (loss) and reversal of impairment gain Recovery of bad debt Total Income from securities lending Net currency exchange gain (loss) Handling fee revenues from funds Others Total	Year ended December 31,2021	Year ended December 31, 2020
	7,846 $ 3,312 11,158 $ Year ended December 31,2021	17,510) ($ 2,202 (15,308) $ Year ended December 31,2020
	374,310 $ 179,749 59,519 1,461 615,039 $	151,265 $ 326,402) ( 46,855 5,413 122,869) ($

40) Other operating income

41) Handling charges

Handling charges
Financial costs Brokerage handling fee expense Dealer handling fee expense Refinancing processing fee expense Total Interest expense from repurchase agreements Loans interest expense Other interest expense Total	Year ended December 31,2021	Year ended December 31, 2020
	396,730 $ 158,914 4,649 560,293 $ Year ended December 31,2021	218,425 $ 149,976 4,704 373,105 $ Year ended December 31,2020
	49,404 $ 29,932 8,755 88,091 $	180,657 $ 60,866 7,867 249,390 $

42) Financial costs

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43) Employee benefits expense

Employee benefits expense
		Year ended		Year ended
	December 31, 2021		December 31, 2020
Salaries	$	3,227,107	$	2,508,670
Labor and health insurance		153,773		120,577
Pension		78,079		66,947
Other employee benefits		156,127		99,822
Total	$	3,615,086	$	2,796,016

A. In accordance to the Company’s Article of Incorporation, the remainder of the year-end income before taxes less income before appropriating employees’ compensation and directors’ remuneration, if any, shall appropriate an employees’ compensation no less than 1.6% and directors’ remuneration no more than 2%. However, when the Company has an accumulated deficit, earnings to cover the deficit shall first be retained before appropriating employees’ compensation and directors’ remuneration.
B. For the years ended December 31, 2021 and 2020, employees’ compensation was accrued at $94,748 and $81,804, respectively; directors’ remuneration was accrued at $94,748 and $81,804, respectively. The aforementioned amounts were recognized in salary expenses.
C. For the year ended December 31, 2021, employees’ compensation was estimated at 2% and directors’ remuneration at 2%, based on the period-end income before taxes less income before appropriating employees’ compensation and directors’ remuneration.
D. The actual distributed amount of employees’ and directors’ remuneration for 2020 as resolved by the Board of Directors was in agreement with the estimates in the 2020 financial statements.
E. Information on the appropriation of the Company’s earnings as resolved by the Board of Directors would be posted in the “Market Observation Post System” on the Taiwan Stock Exchange Official website.

44) Depreciation and amortization

website. Depreciation and amortization
Depreciation Amortization Total	Year ended December 31,2021 150,889 $ 24,676 175,565 $	Year ended December 31, 2020
		142,494 $ 14,911 157,405 $

45) Other operating expenses

Other operating expenses
Taxes Security lending expense Computer information expenses TDCC service fee Others Total		Year ended December 31,2021		Year ended December 31,2020
		985,535 $ 179,411 123,302 134,050 429,693 1,851,991 $		708,890 $ 93,702 102,723 77,306 374,595 1,357,216 $

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46) Other gains and losses

Financial income Net gain (loss) on disposal of investments Net gain (loss) on valuation of non-operating financial instruments Other non-operating revenues Total	Year ended December 31,2021 Year ended December 31,2020 9,860 $ 11,715 $ 8,252 40,290) ( 4,901) ( 7,352) ( 143,114 136,569 156,325 $ 100,642 $

47) Income tax

A. Income tax expense

(a)Components of income tax expense:

Income tax A. Income tax expense (a)Components of income tax expense: Total				156,325 $		$	100,642
				Year ended			Year ended
			December 31,2021			December 31, 2020
Current tax:
Current tax on profits for the periods	$			607,155	$		319,537
Prior year income tax
underestimation (overestimation)				50,868	(		27,970)
Tax on undistributed surplus earnings				852			-
Total current tax				658,875			291,567
Deferred taxes:
Origination and reversal of temporary
differences	(			33,531)			27,511
Total deferred taxes	(			33,531)			27,511
Income tax expense	$			625,344	$		319,078

(b)The income tax expense relating to components	of			other comprehensive income is as follows`：`
				Year ended			Year ended
			December31,2021			December 31, 2020
Remeasurement of defined benefit obligations	($			25,465)	($		4,032)
B. Reconciliation between income tax expense and accounting profit
				Year ended			Year ended
			December 31,2021			December 31,2020
Tax calculated based on profit before tax and statutory tax rate		$		926,557	$		785,319
Expenses disallowed by tax regulation	(			62,113)			21,336
Prior year income tax underestimation (overestimation)				50,868	(		27,970)
Tax exempt income by tax regulation	(			715,701)	(		755,544)
Effect from Alternative Minimum Tax				424,881			295,937
Tax on undistributed earnings				852			-
Income tax expense		$		625,344	$		319,078

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C. Amounts of deferred tax assets or liabilities as a result of temporary differences, tax losses and investment tax credits are as follows ：

	For	theyear ended	theyear ended	Decmeber 31,2021	Decmeber 31,2021	Decmeber 31,2021
	January1		Recognised in profit or loss	Recognised in other comprehensive income		December 31
- $ 8,754 87,289 3,341 99,384 $ 2,813) ($ 96,571 $ For
	January1	Recognised in profit or loss		Recognised in other comprehensive income		December 31
39,479 $ 4,219 - 83,257 5,243 132,198 $ - $ 12,148) ( 12,148) ($ 120,050 $		39,479) ($ 4,219) ( 8,754 - 1,902) ( 36,846) ($ 2,813) ($ 12,148 9,335 $ 27,511) ($		- $ - - 4,032 - 4,032 $ - $ - - $ 4,032 $	- $ - 8,754 87,289 3,341 99,384 $ 2,813) ($ - 2,813) ($ 96,571 $

226

D. As of December 31, 2021, the Company’s income tax returns through 2018 have been assessed and approved by the National Tax Authority.
E. With respect to the income tax returns of the Company for 2018, the Tax Authority assessed to increase income tax payable by $4,581. However, the Company disagreed with the assessments and had filed for administrative remedy. The Company had recognized the income tax expense based on the assessment.

48) Earnings per share

based on the assessment. ) Earnings per share
Basic earnings per share Net income attributable to common shareholders Dilutive effect of common stock equivalents Employee bonus Basic earnings per share Net income attributable to common shareholders Dilutive effect of common stock equivalents Employee bonus	Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 4,007,435 $ 1,455,831 2.75 $ - 4,006 4,007,435 $ 1,459,837 2.75 $ Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 3,607,518 $ 1,455,831 2.48 $ - 4,624 3,607,518 $ 1,460,455 2.47 $ Year ended December 31,2021 Year ended December 31, 2020
	Amount after tax	Weighted-average outstanding common shares (In thousands)

	Amount after tax 3,607,518 $ - 3,607,518 $	Weighted-average outstanding common shares (In thousands)
		1,455,831 4,624 1,460,455	2.48 $ 2.47 $

The above-mentioned weighted average number of outstanding shares has been adjusted based on the proportion of capital increase on September 1, 2021, and the earnings per share for the year ended December 31, 2020 have been recalculated.

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7. RELATED PARTY TRANSACTIONS

1) Names and relationships of related parties

Names of related parties Uni-President Enterprises Corp.

President Capital Management Corp. President Futures Corp. Company President Securities (HK) Ltd. Associates President Insurance Agency Corp. Company PSC Venture Capital Investment Limited Company President Securities (Nominee) Ltd. President Wealth Management (HK) Ltd. Uni-President Asset Management Corp. President Tokyo Co., Ltd. President Tokyo Auto Leasing Co., Ltd. ScinoPharm Taiwan, Ltd. Ton Yi Industrial Corp. President Chain Store Corp. (PCSC) Presco Netmarking, Inc. President Professional Baseball Team Co., Ltd. Tainan Spinning Retail And Distribution Co., Ltd. Kai Yu (BVI) Investment Co., Ltd Cayman President Holdings Limited President Life Sciences Cayman Co., Ltd President (BVI) International Investment Holdings Ltd Funds managed by Uni-President Asset Management Corp.

Relationship with the Company Entity having significant influence on the Company Subsidiary of the Company PSC Subsidiary of the Company PSC Subsidiary of the Company PSC Subsidiary of the Company PSC Subsidiary of the Company PSC Subsidiary of the Company PSC Subsidiary of the Company PSC Associate Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party

Security investment trust fund raised by the Uni-President Asset Management Corp.

2) Significant related party transactions and balances A. Futures guarantee deposits receivable

December 31, 2021 December 31, 2020

Subsidiary of the Company PSC: President Futures Corp.

$ 4,353,971 $ 2,825,942

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B. Accounts receivable

Accounts receivable	Accounts receivable	Accounts receivable	Accounts receivable	Accounts receivable
Other receivables Lease transactions`－`lessee (A) The Group leases business vehicles and multifunction printers, etc., from President Tokyo Co. Ltd. Rental contracts are typically made for periods of 1 to 5 years. Rents are paid monthly. (B) Right-of-use assets: a. Acquisition of right-of-use assets: December 31,2021 December 31,2020 Entity having significant influence on the company: Uni-President Enterprises Corp. 312 $ 25 $ Subsidiary of the Company PSC: President Futures Corp. 3,090 3,389 Company President Securities (HK) Ltd. 555 149 Other related party: ScinoPharm Taiwan, Ltd. 526 399 President Chain Store Corp. (PCSC) 207 378 Others 102 73 Total 4,792 $ 4,413 $ December 31,2021 December 31,2020 Subsidiary of the Company PSC: President Futures Corp. $ 175 $ 257 Others 32 20 Other related party: Others 9 18 Total 216 $ 295 $ December 31,2021 December 31,2020 Other related party: President Tokyo Co., Ltd. 3,432 $ 14,471 $ President Tokyo Auto Leasing Co., Ltd. 3,732 - total 7,164 $ 14,471 $
		3,432 $ 3,732 7,164 $		14,471 $ - 14,471 $

C. Other receivables

－ D. Lease transactions lessee

(A) The Group leases business vehicles and multifunction printers, etc., from President Tokyo Co., Ltd. Rental contracts are typically made for periods of 1 to 5 years. Rents are paid monthly.
(B) Right-of-use assets:
b. Disposals of right-of-use assets:

Disposals of right-of-use assets:
Other related party: President Tokyo Co., Ltd.		Year ended December 31,2021		Year ended December 31,2020
		2,185 $		- $

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(C) Lease liabilities

`–` a. Lease liabilities current

ase liabilities Lease liabilities`–`current
Lease liabilities`–`non-current December 31, 2021 Other related party: President Tokyo Co., Ltd. 6,472 $ President Tokyo Auto Leasing Co., Ltd. 737 Total 7,209 $ December 31, 2021 Other related party: President Tokyo Co., Ltd. 13,362 $ President Tokyo Auto Leasing Co., Ltd. 2,934 Total 16,296 $	December 31, 2020
	7,016 $ - 7,016 $ December 31, 2020 17,378 $ - 17,378 $

b. Lease liabilities non-current
c. Financial costs

Other related party: President Tokyo Co., Ltd. President Tokyo Auto Leasing Co., Ltd. Total

d. Net gain on lease modification

Other related party: President Tokyo Co., Ltd.

E. Refundable deposits

Subsidiary of the Company PSC: President Futures Corp.

F. Accounts payable

Subsidiary of the Company PSC: President Futures Corp.

Year ended December 31,2021 180 $ 2 182 $ December 31,2021 7 $ December 31,2021	Year ended December 31,2021 180 $ 2 182 $ December 31,2021 7 $ December 31,2021	Year ended December 31, 2020 144 $ - 144 $ December 31,2020 - $ December 31,2020	Year ended December 31, 2020 144 $ - 144 $ December 31,2020 - $ December 31,2020

	34,000 $ December 31,2021		34,000 $ December 31,2020
	697 $		104 $

230

G. Guarantee deposit received

G.	Guarantee deposit received
H. I.	Bonds sold under repurchase agreements Structured notes Subsidiary of the Company PSC: President Futures Corp. Others Associate: Uni-President Assets Management Corp. Other related party: President Tokyo Co., Ltd. Total Other related party: Kai Yu (BVI) Investment Co., Ltd Cayman President Holdings Ltd. Total Other related party: Kai Yu (BVI) Investment Co., Ltd Cayman President Holdings Ltd. Total	December 31,2021 $ 16,137 811 1,044 1,418 19,410 $ December 31, 2021	December 31,2020 $ 16,137 811 1,044 1,434 19,426 $ December 31, 2020
		$ - 69,200 69,200 $	$ 148,096 489,856 637,952 $ December 31,2020
			$ 116,768 12,816 129,584 $

There were no transactions with related party as at December 31, 2021.

	There were no transactions with related party as at December 31, 2021.	There were no transactions with related party as at December 31, 2021.	There were no transactions with related party as at December 31, 2021.	There were no transactions with related party as at December 31, 2021.
J.	The above transaction amounts are respectively listed under the financial through profit or loss-current and other financial liabilities-current. Handling fee revenue Year ended December 31,2021 Entity having significant influence on the company: Uni-President Enterprises Corp. $ 6 Subsidiary of the Company PSC: Others 74 Security investment trust fund raised by the Uni-President Asset Management Corp.: Uni-President Asset Management Corp. 69,708 Other related party: Others 1,217 Total 71,005 $				liabilities at fair value Year ended December 31,2020 $ - 48 47,108 2,354 49,510 $
			$ 6 74 69,708 1,217 71,005 $

Terms of handling fee revenue mentioned above are similar to those of transactions with third

231

parties.

K. Futures commission income

parties. K. Futures commission income	parties. K. Futures commission income	parties. K. Futures commission income	parties. K. Futures commission income
L. Gain on wealth management-trust income from sales of funds The revenues were collected on a monthly basis in accordance with contract terms. M. Other operating income-handling charge revenue The revenues were collected on a monthly basis in accordance with contract terms. N. Rent income Year ended December 31, 2021 Year ended December 31,2020 Subsidiary of the Company PSC: President Futures Corp. 42,884 $ 40,206 $ Year ended December 31,2021 Year ended December 31, 2020 Associates: Uni-President Assets Management Corp. 6,730 $ 5,260 $ Year ended December 31, 2021 Year ended December31,2020 Associates: Uni-President Assets Management Corp. 53,784 $ 45,022 $ Period Deposit Year ended December 31, 2021 Year ended December 31, 2020 Subsidiary of the Company PSC President Capital Management Corp. 2019.04.01~2024.03.31 595 $ $ 3,644 $ 3,644 Others 353 2,755 2,747 Associates: Uni-President Assets Management Corp. 2016.01.01~2024.03.31 1,044 6,490 6,811 Other related party: President Tokyo Co., Ltd. 2018.04.01~2024.03.31 1,418 9,061 9,422 Total 21,950 $ 22,624 $
	$ 3,644 2,755 6,490 9,061 21,950 $		$ 3,644 2,747 6,811 9,422 22,624 $

Rental income mentioned above is derived from leasing part of the Company’s office space and business premises to various related parties and calculated as agreed by both parties. Lease payments are collected on schedule in accordance with the terms of the lease contracts. O. Revenues from underwriting business

Revenues from underwriting business
Entity having significant influence on the company: Uni-President Enterprises Corp.		Year ended December 31,2021		Year ended December 31,2020
		$600		$300

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P. Stock custodian income

Stock custodian income
		Year ended		Year ended
	December 31,2021		December 31,2020
Entity having significant influence on the
company:
Uni-President Enterprises Corp.	$	3,908	$	3,697
Subsidiary of the Company PSC
Other		68		66
Associate:
Uni-President Assets Management Corp.		134		135
Other related party:
ScinoPharm Taiwan, Ltd.		2,547		2,635
Ton Yi Industrial Corp.		1,271		1,220
President Chain Store Corp. (PCSC)		2,478		2,097
Others		667		663
Total	$	11,073	$	10,513

Terms of stock custodian income mentioned above are similar to third parties. Q. Net gain (loss) from derivatives

Net gain (loss) from derivatives
Other related party: Cayman President Holdings Limited Kai Yu (BVI) Investment Co., Ltd Total	Year ended December 31,2021	Year ended December 31,2020
	1,360) ($ 1,290) ( 2,650) ($	1,189) ($ 36) ( 1,225) ($

R. Other operating expenses

a. Equipment rental

Other operating expenses a. Equipment rental
b. Copy expense Other related party: President Tokyo Co., Ltd. Other related party: President Tokyo Co., Ltd.	Year ended December 31,2021	Year ended December 31,2020
	18 $ Year ended December 31,2021	413 $ Year ended December 31,2020
	592 $	1,476 $

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c. Advertising expense

	c. Advertising expense
S. T. U.	Clearing charges-futures Service Expense Financial expense Other related party: Presco Netmarking, Inc. President Professional Baseball Team Co., Ltd. Tainan Spinning Retail And Distribution Co., Ltd. Others Total Subsidiary of the Company PSC: President Futures Corp. Subsidiary of the Company PSC: President Capital Management Corp. Other related party: Cayman President Holdings Limited Kai Yu (BVI) Investment Co., Ltd President (BVI) International Investment Holdings Ltd President Life Sciences Cayman Co., Ltd Total	Year ended December 31,2021	Year ended December 31,2020
		15,395 $ 2,310 2,000 473 20,178 $ Year ended December 31, 2021	- $ 2,100 - 522 2,622 $ Year ended December 31, 2020
		14,089 $ Year ended December 31,2021	11,731 $ Year ended December 31, 2020
		50,400 $ Year ended December 31, 2021	50,400 $ Year ended December 31,2020
		1,601 $ 2,080 - - 3,681 $	1,134 $ 155 564 212 2,065 $

234

V. Purchases of trading securities – dealer

Compensation of key management personnel
The compensation of key management such as directors, general managers, vice general managers
were as follows:
Ending Shares
(In thousands)
EndingBalance
Entity having significant influence on
the company:
Uni-President Enterprises Corp.
100
6,860
$ 67)
($ Security investment trust fund raised
by the Uni-President Asset
Management Corp.:
Uni-President Asset Management
Corp.
-
39,013
3,084
Other related parties:
President Chain Store Corp.
-
-
367)
(
Other
54
816
179)
(
Total
46,689
$ 2,471
$ Ending Shares
(In thousands)
EndingBalance
Entity having significant influence on
the company:
Uni-President Enterprises Corp.
5
338
$ 2,029)
($ Other related parties:
President Chain Store Corp.
-
-
119)
(
ScinoPharm Taiwan, Ltd.
-
-
47)
(
Other
-
-
1)
($ Total
338
$ 2,196)
($ Gain(loss)
December 31,2021
December 31,2020
Gain(loss)
Year ended
December 31,2021
Year ended
December 31,2020
Salary and short-term employee benefits
334,690
$ 264,054
$ Retirement benefits
930
660
Other long-term employee benefits
-
-
Termination benefits
-
-
Share-based payment
-
-
Total
335,620
$ 264,714
$

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8. PLEDGED ASSETS

The Company’s assets pledged or restricted for use were as follows:

Assets Trading securities (par value) - Corporate bonds - Government bonds - Overseas bonds - International bonds - Bank debentures Other current assets: - Demand deposits - Pledged time deposits - Government bonds (par value) Property and equipment - Land and buildings (book value) Pledged time deposits - Operating guarantee deposits Financial assets at fair value through profit or loss - current: Financial assets at fair value through profit or loss - non-current:	December 31,2021 500,000 $ 1,507,300 7,124,566 623,210 300,000 5,244,571 400,000 50,000 1,096,408 505,000	December 31,2020 950,000 $ 2,634,800 15,119,396 1,034,879 200,000 652,010 400,000 50,000 1,101,768 505,000	Purposes
			Securities for bonds sold under repurchase agreements Securities for bonds sold under repurchase agreements Securities for bonds sold under repurchase agreements Securities for bonds sold under repurchase agreements Securities for bonds sold under repurchase agreements Collections on behalf of third parties and reimbursement for wages and stocks Securities for short-term loans and guarantees for issuance of commercial papers Trust fund deposit-out Securities for short-term loans and guarantees for issuance of commercial papers Security deposits

9. SIGNIFICANT COMMITMENTS

None.

10. SIGNIFICANT LOSS FROM NATURAL DISASTER

None.

11. SIGNIFICANT SUBSEQUENT EVENT

None.

12. OTHER

1) Management objective and policy of financial risks

A. Risk management objective

The Company continually strengthens risk culture to every employee and makes sure that the Company can actively develop various businesses under a healthy and effective risk management system. At the same time, by creating value of an entity and continually increasing profit, profit maximization may be achieved within appropriate risk tolerance.

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B. Risk management system
In order to ensure the completeness of risk management system, run the balancing mechanism of risk management, and improve the division efficiency of risk management, the Company sets up “Risk Management Policy”. Such policy aims to establish internal system compliance and the guiding tools for policies communication within the Company and enable every layer of the Company engaged in different tasks to identify, evaluate, monitor, and control various risks with establishment of consistent compliance rules for risks of each business so that the risks can be controlled within the limits set in advance.
The Company’s risk management system covers risks incurred from businesses in and off the balance sheet, such as market risk, credit risk, liquidity risk, operating risk, legal risk, model risk which are all included in the risk management.
C. Risk management organization
Risk management organization: Board of Directors, Risk Management Committee, Risk Control Office, Business units and other related segments (such as Office of Auditing, Office of General Manager, Compliance segment, Legal segment, Finance segment and Settlement segment) are in charge of planning, supervising and execution.
(A) The Board of Directors should ensure the effectiveness of risk management and be responsible for the ultimate result and the following duties:
- a. To establish proper risk management system, operating process, and risk management culture in the Company with allocation of necessary resource for better execution and operation.
- b. Policy of risk management review.
- c. Review and approval of business application, transaction authorization and risk limit.
(B) The Risk Management Committee reports to the Board of Directors and is responsible for the following:
- a. Review risk management policy.
- b. Review the highest risk tolerance.
- c.Submit regular reports to the Board of Directors in relation to the risk management status of the whole Company.
(C) The General Manager supervises daily risk management of the entire Company and is responsible for the following:
- a. Supervise and monitor daily risk management of the entire Company.
- b. Approval of management exceptions.
(D) Assets and Liabilities Committee reports to the General Manager and is responsible for the following:
- a. Set up the ultimate guidelines for assets and liabilities management of the entire Company.
- b. Analyze and control the entire Company’s assets and liabilities portfolio.
- c. Approval of various businesses’ quotas.
- d. Gather and analyze information on domestic and offshore interest rate, exchange rate, prosperity fluctuation, political and economic environmental changes, and predict the financial trend in the future.
(E) Risk Control Office implements risk management policy and related regulations and reports to the Risk Management Committee. Risk Control Office also reports daily risk management to the General Manager and is responsible for the following:
- a. Establish Risk Management Policy of the entire Company.
- b. Develop effective method for measurement and risk management in an entity.
- c. Review risk management system of business units.
- d. Generate risk report through information gathering and consolidation.
- e. Analyze various business risks and report to the General Manager.

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  - f. Report the risk management situation to the Risk Management Committee according to a meeting’s nature and needs.

  - g. Carry out duties as designated by the Risk Management Committee and control risks of business units.

(F) Auditing Office is responsible for the following:
- a. Execute operating risk control.
- b. Include the risk management system into internal audit program and carry out the daily audit schedule.
- c. Assess the effectiveness of internal control and verify the executed result.
(G) Compliance segment and legal segment under the Office of General Manager are responsible for the following:
- a. Compliance segment should make sure that the business operation and risk management system are in compliance with relevant regulations.
- b. Legal segment is responsible for legal risk control.
- c. Compliance segment also provides services of Anti-Money Laundering and Counter Terrorism Financing, including designs specification and internal control, establishes transaction monitoring, oversees the effective implementation of business units, conducts the employee training and reports any suspicion of money laundering.
(H) Finance segment is responsible for the following:
- a. Verify the correctness of position information and reasonability of profit and loss calculation.
- b. Control and analyze self-owned capital adequacy ratio.
- c. Analyze the appropriateness of structures of the assets and liabilities.
(I) Business units are responsible for the following:
- a. Set up risk management details of various businesses according to the risk management policy and other related regulations.
- b. Provide sufficient position information and risk control information to the Risk Control Office.
(J) Settlement division is responsible for:
- a. Clearing and settlement; risk control and management of margin purchase and short sale of securities.
- b. Risk control and management of trading middle office and enforcement of rules governing risk management of business segments.
D. Risk management policy

In order to ensure the completeness of risk management system, run the balancing mechanism of risk management, and improve the division efficiency of risk management, the Company sets up “Risk Management Policy”. Such policy aims to establish internal system compliance and the guiding tools for policies communication within the Company and enable every layer of the Company engaged in different tasks to identify, evaluate, monitor, and control various risks with establishment of consistent compliance rules for risks of each business so that the risks can be controlled within the limits set in advance.

Risk management processes include risk identification, risk evaluation, risk supervision and various risk control. Each kind of risk evaluations and responding strategies are described as follows:

(A) Market risk management

The Company has implemented risk management information system (Risk Manager) in relation to market risk control. All trading positions of the Company have been included in the daily risk control system for the calculation of Value at Risk (VaR). Limit exceeding indicators are mainly the nominal principal, stop-loss, sensitivity (Greeks) and VaR. The risk

238

management report is presented on a daily basis for implementation of regular control and limit exceeding handling procedures.

(B) Credit risk management

In relation to risk control, the quantitative model of default rate adopts KMV model to calculate the default rate of issuers with credit exposure of the issuing company and the trading counterparties, and credit risk of securities disclosed in the report. The credit exposure is mitigated through regular review of credit status.

Unit in charge of fund procurement regularly predicts future fund demand and supply, and consolidates company guarantee or endorsement and capital lending businesses to monitor the condition of fund procurement on a daily basis.

E. Hedging and risk-offsetting strategy
- (A) Policies of hedging and risk mitigating are parts of the Company’s risk management policies, and the hedging position and hedged trading position are supposed to be one portfolio, of which the gain and loss and risk information are measured on a consolidated basis.
- (B) The overall position (hedging position and trading position) is included in the daily risk management system to calculate Value at Risk and other relevant information. Limit exceeding indicators mainly include nominal principal, stop-loss point, price sensitivity and VaR. With the presentation of daily risk management report, routine control and limit exceeding treatment can be executed.
- (C) The continued effectiveness of hedging and risk-offsetting strategy is measured by the gain and loss of overall position (hedging position and trading position), in order to track reasonableness of the profit or loss of hedging position and the offsetting relationship with the profit or loss of trading position, and to control them within a reasonable range.
2) Credit risk
A. Source and definition of credit risk
- The credit risk exposure of the Company as a result of engagement in financial transactions include issuer’s credit risk, credit risk of counterparty and credit risk of underlying assets:
- (A) Credit risk of the issuer refers to the issuers of financial debt instruments held by the Company failing to repay its obligation due to the fact that the issuer breaches the contract resulting in the risk of financial loss to the Company.
- (B) Credit risk of counterparty refers to risk of financial loss to the Company arising from default by the counterparty of financial instruments on the settlement or payment obligation.
- (C) Credit risk of the underlying assets happens when the credit rating of the underlying assets linked to the financial instrument is downgraded by the rating agency or when the losses occur as a result of contract default.
- The financial assets held by the Company which could result in credit risk include bank deposit, debt securities, derivatives transactions in OTC, bonds purchased/sold under resale/repurchase agreements, refundable deposit of securities lending, futures trade margins, other refundable deposits and receivables.
B. Maximum credit risk exposure and credit risk concentration
- The maximum exposure to credit risk of financial assets in the parent company only balance sheet, without consideration of the collateral or other credit enhancements, is equivalent to the carrying amount. In Taiwan, the sources of credit risk of the Company are primarily resulting from cash deposited with banks or other financial institutions, debt securities issued or guaranteed by a bank, derivative instruments transaction underwritten by the Company, and all counterparties of customer margin deposits accounts being financial institutions. Credit risks of various financial assets are as follows:

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(A) Cash and cash equivalents

Cash and cash equivalents include time deposit, demand deposits and checking deposits. Correspondent institutions are mainly domestic financial institutions.

(B) Financial assets at fair value through profit and loss -current
a. Fund

The funds held by the Company are bond funds. As the positions held are not significant, credit risk is deemed low.

b. Commercial papers

The commercial papers held by the Company are repurchase agreements. As all the counterparties are financial institutions with good credit, the credit risk from counterparties is extremely low.

c. Debt securities

Debt securities are mainly positions like government bonds, corporate bonds, convertible corporate bonds and foreign bonds and the issuers are primarily R.O.C. government, domestic and foreign legal entities. 42% of convertible corporate bond is guaranteed by banks. Details are as follows:

(a)Government bonds

The bonds held by the Company are mostly government bonds (inclusive of central and local government). As a whole, the credit risk of the bonds held by the Company is low.

(b) Corporate bonds

The corporate bonds held by the Company are mainly underlying investment with good credit rating and those with rating above (S&P BB).

(c)Convertible corporate bond

The convertible corporate bonds held by the Company are mostly issued by the domestic legal entities. The Company mitigates highly risky credit exposure of the issuers by control through Taiwan Corporate Credit Risk Index (TCRI).

(d)Foreign bonds

The foreign bonds held by the Company are mainly underlying investment with good credit rating and those with rating above (S&P BB).

The foreign government bonds held by the Company are classified as debt instruments at fair value through other comprehensive income. In general, the bonds held by the Company are with lower credit risk.

(D) Derivatives- futures trade margin

When engaging in futures trades in stock exchange market, the Company needs to deposit margin into a margin deposit account of a financial institution designated by the futures merchants as a guarantee to fulfil contractual obligation in the future. As a result, the credit risk is low.

(E) Derivatives-OTC

The Company signs International Swaps and Derivatives Association (ISDA) agreements with each counterparty when engaging in OTC derivatives as an agreement regarding such transactions for both parties. In the agreement, it provides a fundamental contractual model for OTC derivative transactions. If any party breaches the contract or terminates the transactions early, then all the open interest covered in the agreement should be settled by net amount as bound in the contract. When the ISDA agreement is signed, the Credit Support Annex (CSA) is also signed. According to the CSA, collateral will be transferred from a party to the other during transaction process to mitigate the risk of counterparty in open interest. Please refer to Note 6(10).

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Types of OTC derivative transactions in which the Company is engaged include swap transaction. The counterparties are all from financial service industry and mainly located in Taiwan and United Kingdom.

(F) Bonds investment under a resale agreement Bonds sold under a resale agreement are the bonds that the client sold to the Company at a price, interest rate, length of period as agreed by two parties and the client shall repurchase the bonds at the specified price upon maturity. The Company needs to assume credit risk from counterparties when underwriting such business, as the payment being delivered to the other party. With consideration of good collateral obtained, the net of credit risk exposure from counterparties can be effectively reduced. As all the counterparties are financial institutions with good credit rating, the credit risks from counterparties are extremely low. Please refer to Note 6(9).
(G) Margin loans receivable
Margin loans receivable are the loans provided to the client in order to process businesses of margin trading and short sale using the securities purchased through financing as collateral. The Company monitors the clients’ margin ratio through information system on a daily basis. As the margin ratio of margin trading is set at 130% according to Regulations Governing the Conduct of Securities Trading Margin Purchase and Short Sale Operations by Securities Firms, the credit risk is extremely low.
(H) Receivables of securities business money lending Receivables of securities business money lending are the non-restricted purpose loan business and monetary financing business, pursuant to an agreement between a securities firm and a customer, using customer securities and other commodities as collateral. The Group regularly assesses its customer line of credit and implements appropriate credit control. As the margin ratio of margin trading is set at 130% according to Regulations Governing the Conduct of Securities Trading Margin Purchase and Short Sale Operations by Securities Firms, the credit risk is extremely low.
(I) Guaranteed price for securities lending Guaranteed price for securities lending is the sale price of the Company’s securities sold by other securities firms through margin trading after deduction of securities transactions tax and service fee, which is deposited in other securities firms as collateral. As all the counterparties are financial institutions with good credit rating, the credit risk from counterparties is extremely low.
(J) Refundable deposits for securities lending Refundable deposits for securities lending are the margins deposited in other securities firm as collateral when the Company’s securities are sold. As all the counterparties are financial institutions with good credit, the credit risk from counterparties is extremely low.
(K) Receivables
Receivables are the credit rights arising from the securities business including settlement receivables of consignment trading, settlement receivables of operating securities sold, financing interest receivables of self-operating credit transaction, receivables of consignment trading for securities, and receivables from banks’ underwriting on foreign exchange transactions and foreign fund demand. As the majority of the Company’s receivables from the consignment businesses and self-operating businesses are settlement of securities from OCT or TWSE, the credit risk is extremely low. As the foreign exchange transactions are simply the receipt or payment of different currencies and the correspondent banks are of good credit rating, the credit risk is extremely low.
(L) Other current assets

Other current assets are mainly the collateral deposited in the bank for application for short-

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term debt limit and guarantee for application for issuance of commercial papers. As the correspondent banks are all financial institutions with good credit rating, the credit risk is extremely low.

(M) Financial assets at fair value through profit and loss – non-current In order to underwrite trust business, the Company deposits central government bonds in the Central Bank as collateral. Regardless of the bonds themselves or the financial institutions where the bonds deposited, the credit risk is extremely low.
(N) Other non-current assets
- Other non-current assets mainly comprise operating guarantee deposits, settlement funds, and refundable deposits. Operating guarantee deposits are mainly deposited in domestic banks with good credit rating. Settlement funds are deposited in securities exchange. Settlement funds are used as compensation when a party to a marketable securities transaction fails to fulfil the settlement obligation. The credit risks from the institutions where these two assets are deposited are extremely low. The refundable deposits refer to cash or other assets which are deposited externally by the Company and can be used as refundable deposits. Because deposits are placed in various financial institutions and each deposit amount is small, the credit risk is dispersed and the credit exposure of overall refundable deposit is extremely low.
C. Expected credit loss assessment

In the assessment of impairment and calculation of expected credit losses, the Company considers reasonable and supporting information about past events, current conditions and future economic conditions. The Company determines at the balance sheet date whether there has been a significant increase in credit risk since initial recognition or whether credit impairment has occurred and recognizes expected credit loss according to which stage the asset belongs: no significant increase in credit risk or low credit risk at balance sheet date (Stage 1), significant increase in credit risk (Stage 2), and credit impaired (Stage 3). 12-month expected credit losses are recognized for assets in Stage 1, and lifetime expected credit loses are recognized for assets in Stage 2 and Stage 3.

The definition of and expected credit losses recognized for each stage are as follows:

Item	Stage 1	Stage 2	Stage 3
Definition	No significant deterioration of credit quality of the financial asset since initial recognition, or the financial asset is considered low-risk at the balance sheet date.	Significant deterioration of credit quality of the financial asset since initial recognition, but the asset is not yet credit impaired.	The financial asset is credit impaired at the financial reporting date.
Expected credit lossesrecognition	12-month expected credit losses	Lifetime expected credit losses	Lifetime expected credit losses

(A) Judgements of the significant increase in credit risk since initial recognition

Judgements and assumptions used to determine whether the credit risk has a significant increase since initial recognition when the Company calculates expected credit loss under IFRS 9 are as follows:

242

a. If contractual payments are over 30 days past due according to the payment terms, the financial asset is considered to have significant increase in credit risk since initial recognition.
b. There is significant increase in credit risk at the reporting date if the credit rating of the issuer has been downgraded by more than 2 grades and the final external credit rating at the reporting date is non-investment grade, if the interest payments are over 30 days past due, or if there has been a default in the past.
(B) Definition of default and credit-impaired financial assets
According to the definition of credit impairment set by IFRS 9, a financial asset is creditimpaired when one or more events that have occurred and have a significant impact on the expected future cash flows of the financial asset. The criteria used to judge whether a financial asset is credit-impaired since initial recognition includes but is not limited to the following:
a. Contractual payments or principal or interest payments on bonds are over 3 months (90 days) past due.
b. Bond investment is rated as “in default” by external credit rating agencies.
c. Bond issuer has filed for bankruptcy, restructure, or other debt clearance procedures.
d. Issuer or counterparty has financial difficulties.
(C) Writing-off policy

If any of the following condition applies, the Company will write off the non-recoverable portion of the overdue receivables as bad debt.

a. Debt cannot be fully or partially recovered due to dissolution of, disappearance of, settlement with, bankruptcy declaration by the debtor, or any other reason.
b. The collateral and the assets of the primary and secondary debtors could not be auctioned off after multiple attempts and multiple price discounts, and the Company has not received any real benefits in assuming the collateral.
c. Payments are over two years past due and could not be recovered after attempts to collect.
(D) Measurement of expected credit losses
The Company considers reasonable supporting information which shows significant increase in credit risk since initial recognition when calculating expected credit losses. Main indexes include: internal/external credit rating, information of past due, credit spread, other market information in relation to the borrower, issuer or counterparty, and significant increase in credit risk of other financial instrument of the same borrower.
a. Investments in bills and bonds
- (a)Probability of default was based on external credit rating, which include forwardlooking information.
- (b)Loss given default was based on the average loss given default of external credit rating of investment position and counterparties.

243

(c)Exposure at default

Stage 1, Stage 2 and Stage 3: Total carrying amount (including interest receivable).

(E) Consideration of forward-looking information
- Historical loss rate (based on the historical experience in the past 3 to 5 years) as obtained and compared with economic environment in the past, nowadays and future (forwardlooking factor) to see whether there is any significant change, and then to properly adjust future loss rate standards. If any significant default event occurs, the loss rate in the current year will be included in the calculation of future loss rate standard.
D. Table of movements in loss provision of the Company
(A) For the years ended December 31, 2021 and 2020, there were no changes in the loss allowance for investments in debt instruments measured at fair value through other comprehensive income.
(B) Except for debt investments and its interest receivable, the Company applies the modified approach to measure the loss allowance at an amount equal to lifetime expected credit losses for receivables and overdue receivables. The movements in loss provision of marginal receivables, accounts receivable, other receivables-others and other non-current assetsoverdue receivables of the Company are as follows:

Year ended December 31, 2021

Marginal receivable	Marginal receivable		Accounts receivable	Other receivables	Other non- current assets- overdue receivables	Total
58,840 $ 11,407) ( - 47,433 $ Marginal receivable						98,907 $ 7,846) ( 30,369) ( 60,692 $ Total
	Marginal receivable		Accounts receivable	Other receivables	Other non- current assets- overdue receivables
	43,806 $ 15,034 - 58,840 $	656 $ 31) ( - 625 $		54 $ - - 54 $	240,073 $ 2,507 203,192) ( 39,388 $	284,589 $ 17,510 203,192) ( 98,907 $

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3) Liquidity risk

A. Definition and source of liquidity risk
Liquidity risk refers to possible financial losses arising from the inability to realize the asset or to obtain sufficient fund to fulfil the financial liabilities soon to be matured. Above situations may weaken the sources of cash from the Company’s trading and investment activities.
B. Liquidity risk management procedure and stimulation test
In order to prevent operational crisis as a result of liquidity risk, the Company has established responding crisis process with regular monitoring over liquidity gap of fund.
(A) Procedure

In addition to the operating capital for various business and long-term investment, the Company needs to maintain revolving funds at a certain level for daily operation. The use of remaining fund shall avoid high concentration and should be based on the principle of holding sound earning assets with high liquidity and treated in compliance with policies of the Company.

The responsive unit for fund procurement adjusts the liquidity gap to ensure proper liquidity according to the daily volume and movement in the market.

(B) Stimulation test
- a. The Company reviews fund liquidity risk from a perspective of supply and demand of fund every month with simulation analysis of available fund for emergency including scenario analysis of cash, funding limit of financial institutions, margin loans and short sale, and value of disposal of position in order to compute maximum available fund and fund demand. Finally, safety stock of fund is reviewed to monitor liquidity risk.
- b. Above liquidity risk is generally reviewed monthly. However, if the available limit of increment banking credit risk in financing limit of a financial institution is lower than a certain amount (that is, the amount may be timely adjusted according to the fund liquidity in the market and the actual fund demand and supply in an entity), the safety stock will be reviewed weekly. After the early warning report for fund is submitted, the head of finance segment will call for a fund control meeting.
- c. Other than individual funding liquidity risk of an entity, stress test of minimization funding supply and maximization funding demand in the event of significant crisis is simulated, including:
  - (a)When there is a significant crisis in the market, the financing limit of the financial institutions and the value of disposal of position can be deemed the minimized ratio of fund supply which is then adjusted according to actual condition to compute the total fund supply under maximum stress.
  - (b)Except for the operating expense, the stock concept is adopted for the calculation of total fund demand under maximum stress.
  - (c)The Company should conduct a review to see whether the total minimized fund supply is more than maximized total fund demand. The Company should further review how long (by month) the difference may cover the operating expenses so that the safety stock of fund (by month) under stress test can be computed.
  - (d)The minimum safety stock of fund under stress test (by month) may be adjusted according to the crisis itself and only operating expense for at least 6 months under a normal stimulation can be deemed safe.
C. Maturity analysis for the financial assets and financial liabilities held for liquidity risk management
(A) The Company holds cash and sound earning assets with high liquidity in order to fulfil the payment obligation and potential emergency fund demand in the market. Financial assets held for liquidity risk management are mainly cash and cash equivalents, among which, all

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time deposits mature within a year. Financial assets at fair value through profit and loss are mainly listed stocks, convertible bonds and debt securities. As all of them have positions in active market, the liquidity risk is deemed low.

(Blank below)

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(B) Maturity analysis for the financial liabilities is as follows:

		December 31,2021
Immediately	Less than 3 months	3-12 months	1-5years - $ - - - - - - 39,435 - 88,582 - - 120,489 248,506 $	Total
- $ - 5,124,273 3,047,462 - 1,202,587 1,559,162 - 17,413,904 5,639,615 5,605 - - 33,992,608 $	590,000 $ 8,650,000 - - 9,648,756 - - 1,069,699 7,595 11,653 260,183 1,789,878 18,742 22,046,506 $	- $ - - - - - - 860,073 - - 2,234,060 3,193,261 44,136 6,331,530 $		590,000 $ 8,650,000 5,124,273 3,047,462 9,648,756 1,202,587 1,559,162 1,969,207 17,421,499 5,739,850 2,499,848 4,983,139 183,367
				62,619,150 $

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		December 31,2020
Immediately	Less than 3 months	3-12 months	1-5years - $ - - - - - - - - 80,784 - - 103,607 184,391 $	Total
- $ - 1,039,794 1,550,679 - 1,381,470 1,809,955 - 18,023,694 1,010,210 985 - - 24,816,787 $	578,976 $ 7,300,000 - - 19,112,268 - - 803,016 14,425 7,680 222,277 2,017,803 19,214 30,075,659 $	- $ - - 31,668 - - - 100,836 - - 1,751,977 3,990,507 42,661 5,917,649 $		578,976 $ 7,300,000 1,039,794 1,582,347 19,112,268 1,381,470 1,809,955 903,852 18,038,119 1,098,674 1,975,239 6,008,310 165,482
				60,994,486 $

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4) Market risk

A. Definition of market risk

Market risk refers to the risk of decrease in the Company’s revenue or value of investment portfolio as a result of the changes in exchange rate, commodity price, interest rate, and stock price or other market risk factors.

The Company continually exercises risk management tools such as sensitivity analysis, Value at Risk, stress test and so on to completely and effectively measure, monitor and manage market risk.

B. Value at Risk (VaR)

Value at Risk is used to measure the possible maximum potential losses in investment portfolio as a result of movement in market risk factor in a specified period and confidence level. The Company currently uses confidence level of 95% to calculate Value at Risk of one day.

A VaR model must reasonably, completely and accurately measure the maximum potential risks of financial instruments or investment portfolio before being adopted as a risk management model by the Company. The VaR model used in risk management is continually certified and retrospectively tested to demonstrate that the model can reasonably and effectively measure the maximum potential risks of financial instruments or investment portfolios.

Statistical table for one-day VaR of transactions	Statistical table for one-day VaR of transactions
Year ended December 31, 2021 Amount December 31, 2021 106,857 $ VaR Maximum 288,441 VaR Average 140,407 VaR Minimum 30,206	Year ended December 31,2020 Amount December 31, 2020 172,331 $ VaR Maximum 274,866 VaR Average 158,787 VaR Minimum 76,059

Year ended December 31,2021 Foreign exchange Interest December 31, 2021 1,402 $ 23,468 $ VaR Maximum 16,890 43,928 VaR Average 4,079 21,628 VaR Minimum 1,103 7,593 Statistical table for VaR of various risk indicators of transactions Year ended December 31,2020 Foreign exchange Interest December 31, 2020 3,413 $ 24,024 $ VaR Maximum 55,596 91,620 VaR Average 7,103 39,354 VaR Minimum 1,489 15,428	Share ownership
	106,496 $ 290,600 139,374 30,696 Share ownership
	175,695 $ 267,430 155,821 67,873

C. Information on gap of foreign exchange risk

The following table summarizes financial instruments of foreign assets or liabilities by currency and the foreign exchange exposure presented by book value as of December 31, 2021 and 2020 ：

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Financial assets in foreign currencies Cash and cash equivalents Financial assets at fair value through profit or loss Bonds purchased under resale agreements Investments under the equity method Others Financial liabilities in foreign currencies Financial liabilities at fair value through profit or loss Bonds sold under repurchase agreements Others	USD 490,710 $ 8,040,988 27,401 - 2,033,302 4,332 4,644,791 3,883,547	EUR 1,969 $ 1,935,974 - - 3,697 1,599 1,688,801 26	AUD RMB HKD 2,005 $ 113,423 $ 158,768 $ 181,807 798,106 254,269 - - - - 2,363,197 1,344,033 40,836 19,652 20,186 106 2,828 195 160,708 588,851 - 40,178 308,104 8,667 December 31,2021	Others 234,811 $ 511,579 - - 793 359 136,622 5,437	Total
					1,001,686 $ 11,722,723 27,401 3,707,230 2,118,466 9,419 7,219,773 4,245,959

Note: As of December 31, 2021, foreign exchange rates of the above currencies to TWD were 1 USD = 27.680 TWD; 1 EUR = 31.320 TWD; 1 AUD = 20.080 TWD; 1 RMB = 4.344 TWD; and 1 HKD = 3.549 TWD, respectively.

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Financial assets in foreign currencies Cash and cash equivalents Financial assets at fair value through profit or loss Investments under the equity method Others Financial liabilities in foreign currencies Short-term loans Financial liabilities at fair value through profit or loss Bonds sold under repurchase agreements Others	USD 350,244 $ 13,281,876 - 808,186 318,976 50,740 9,996,698 2,945,156	EUR 2,479 $ 3,486,806 - 10,371 - 3,898 3,080,106 -	AUD RMB HKD 2,247 $ 260,037 $ 269,730 $ 1,006,892 1,267,289 378,212 - 2,531,901 1,419,007 1,918 34,377 5,161 - - - 3,441 3,426 172 853,836 871,401 - 240 263,221 52,811 December 31,2020	Others 173,112 $ 424,984 - 28,645 - 5,422 286,703 27,835	Total
					1,057,849 $ 19,846,059 3,950,908 888,658 318,976 67,099 15,088,744 3,289,263

Note: As of December 31, 2020, foreign exchange rates of the above currencies to TWD were 1 USD = 28.480 TWD; 1 EUR = 35.020 TWD; 1 AUD = 21.950 TWD; 1 RMB = 4.377 TWD; and 1 HKD = 3.673 TWD, respectively.

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D. The total exchange gain (loss), including realized and unrealized, arising from significant foreign exchange variation on the monetary items held by the Company for the years ended December 31, 2021 and 2020, amounted to $179,749 and ($326,402), respectively.
5) Fair value and hierarchy information
A. Financial instruments and non-financial instruments not measured at fair value. Except for those listed in the table below, the carrying amounts of the Company’s financial instruments not measured at fair value (including cash and cash equivalents, bonds purchased under resale agreements, margin loans receivable, refinancing guaranty deposits, guaranteed proceeds receivable from refinancing, guaranteed price deposits for security borrowing, security borrowing deposits, customer margin deposit account, notes and accounts receivable, other receivables, short-term loans, commercial paper payable, bonds sold under repurchase agreements, guarantee deposit received from short sales, guaranteed price deposits received from securities borrowers, security borrowing deposits, equity of futures traders, accounts payable, collection for others, and other payables) approximate their fair values. The fair value information of financial instruments measured at fair value is provided in Note 12(5)3.

Non-financial assets December 31, 2021 Investment property December 31, 2020 Investment property	Total 712,476 $ 667,546 $	Quoted prices of the same assets in active markets (level 1) Other significant observable inputs (level 2) - $ 712,476 $ - $ 667,546 $	Significant non-observable inputs(level 3)
			- $ - $

The fair value of investment property held by the Company was assessed by external valuation experts using comparison approach and income approach, or the fair value can be assessed based on the market price of the area adjacent to the location where the Company’s investment property is located.

B. Valuation techniques
(A) For financial instruments held for trading purposes which are classified as non-derivative instruments, their fair values are based on their quoted prices in an active market. If there is no quoted market price for reference, a valuation technique will be adopted to measure the fair value. Estimates and assumptions of valuation technique adopted by the Company are in agreement with the information of estimates and assumptions adopted by market users for financial instrument pricing and the said information shall be accessible to the Company. For those classified as derivative instruments, their fair values are based on their market prices if their quoted prices are available from an active market. If quoted market prices in an active market are not available, SWAP and IRS are valued at the discounted cash flow method, and options are valued at the Black-Scholes model.
(B) When available-for-sale financial assets have quoted market prices available in an active market, the fair value is determined using the market price.
C. Fair value hierarchy of the financial instruments
(A) Definitions for the hierarchy classifications of financial instruments measured at fair value
- a. Level 1
  - Level 1, are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company can access at the measurement date. An active market has to satisfy

252

all the following conditions: 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. The Company’s investments in listed stocks, beneficiary certificates, onthe-run Taiwan central government bonds and derivative instruments with quoted market prices, are deemed as level 1.

b. Level 2

Inputs other than quoted market prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Investments of the Company such as off-the-run issue of emerging stock, government bonds, corporate bonds, bank debentures, convertible corporate bonds, currency swaps, interest rate swaps, options, asset swaps, and most derivatives are all classified within level 2. For the years ended December 31, 2021 and 2020, there was no significant transfer of financial instruments between Level 1 and Level 2.

c. Level 3

Unobservable inputs for the assets or liability. The fair value of the Company’s investment in unlisted stocks is included in Level 3.

(Blank below)

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(B)Hierarchy of fair value estimation of financial instruments

Financial instrument items measured at fair value Recurring fair value Non-derivative financial instruments Assets Financial assets at fair value through profit or loss-current Stock investments Bond investments Others Financial assets at fair value through other comprehensive income-current Stock investments Financial assets at fair value through profit or loss - non-current Stock investments Bond investments Financial assets at fair value through other comprehensive income-non-current Stock investments Liabilities Financial liabilities at fair value through profit or loss -current Derivative financial instruments Assets Financial assets at fair value through profit or loss-current Liabilities Financial liabilities at fair value through profit or loss - current		December	31,2021
	Total 14,288,286 $ 13,213,896 1,049,451 410,205 12,650 50,124 258,627 5,124,273 4,735,030 3,047,462	Level 1 14,247,565 $ 776,724 1,049,451 410,205 - - - 5,124,273 4,720,306 2,623,530	Level 2 40,721 $ 12,437,172 - - - 50,124 - - 14,724 423,932	Level3
				- $ - - - 12,650 - 258,627 - - -

254

Financial instrument items measured at fair value Recurring fair value Non-derivative financial instruments Assets Financial assets at fair value through profit or loss-current Stock investments Bond investments Others Financial assets at fair value through other comprehensive income-current Stock investments Financial assets at fair value through profit or loss - non-current Stock investments Bond investments Financial assets at fair value through other comprehensive income-non-current Stock investments Liabilities Financial liabilities at fair value through profit or loss -current Derivative financial instruments Assets Financial assets at fair value through profit or loss-current Liabilities Financial liabilities at fair value through profit or loss - current		December	31,2020
	Total 11,927,130 $ 23,302,082 2,237,129 353,510 16,991 50,493 186,334 1,039,794 3,365,537 1,582,347	Level 1 11,903,943 $ 1,170,822 2,237,129 353,510 - - - 1,039,794 3,356,164 1,430,919	Level 2 23,187 $ 22,131,260 - - - 50,493 - - 9,373 151,428	Level3
				- $ - - - 16,991 - 186,334 - - -

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(C) The following table is the movement of financial assets at Level 3:

January1	Recorded in profit or loss Recorded in other comprehensive income(loss) Acquired/ Issued Transfers into level 3 4,341) ($ - $ - $ - $ - 72,293 - - Year ended December 31,2020 Valuation amount Increased Year ended December 31,2021 Valuation amount Increased	Recorded in profit or loss Recorded in other comprehensive income(loss) Acquired/ Issued Transfers into level 3 4,341) ($ - $ - $ - $ - 72,293 - - Year ended December 31,2020 Valuation amount Increased Year ended December 31,2021 Valuation amount Increased	Recorded in profit or loss Recorded in other comprehensive income(loss) Acquired/ Issued Transfers into level 3 4,341) ($ - $ - $ - $ - 72,293 - - Year ended December 31,2020 Valuation amount Increased Year ended December 31,2021 Valuation amount Increased	Recorded in profit or loss Recorded in other comprehensive income(loss) Acquired/ Issued Transfers into level 3 4,341) ($ - $ - $ - $ - 72,293 - - Year ended December 31,2020 Valuation amount Increased Year ended December 31,2021 Valuation amount Increased	Decreased	Decreased	December 31
			Acquired/ Issued	Transfers into level 3	Sold, disposed or settled	Transfers out from level 3
16,991 $ 186,334 January1					- $ - $ - - Decreased		12,650 $ 258,627 December 31
	Recorded in profit or loss	Recorded in other comprehensive income(loss)	Acquired/ Issued	Transfers into level 3	Sold, disposed or settled	Transfers out from level 3
21,180 $ 157,656	4,189) ($ -	- $ 28,678	- $ -	- $ -	- $ -	- $ -	16,991 $ 186,334

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(D) 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:

value measurement:
December 31,2021	Fair value	Valuation technique	Significant unobservable input Not applicable Price to earnings ratio multiple Discount for lack of marketability Significant unobservable input	Range (weighted average)	Relationship of inputs to fair value
Financial assets at fair value through profit or loss - non-current Venture capital shares Financial assets at fair value through other comprehensive income - non-current December 31,2020 Unlisted stocks	12,650 $ Fair value 258,627	Net asset value Valuation technique Market approach		Not applicable 1.80~2.27 6.24%~9.17% Range (weighted average) Not applicable 1.46~1.90 6.99%~9.65%	Not applicable The higher the multiple,the higher the fair value The higher the discount for lack of marketability, the lower the fair value Relationship of inputs to fair value
Financial assets at fair value through profit or loss - non-current Venture capital shares Financial assets at fair value through other comprehensive income - non-current Unlisted stocks	16,991 $ 186,334	Net asset value Market approach	Not applicable Price to earnings ratio multiple Discount for lack of marketability		Not applicable The higher the multiple,the higher the fair value The higher the discount for lack of marketability, the lower the fair value

(E) Valuation process for fair value at Level 3

The parent company’s risk management department is responsible for the verification of fair value categorized in Level 3. The department assesses the independence, reliability, consistency and representativeness of the source information, regularly verifies the valuation models and calibrates the parameters to ensure the valuation process and results are in compliance with IFRSs.

(F) For the fair value measurement of Level 3, the sensitivity analysis of the fair value to the reasonable alternative hypothesis shows that the fair value measurement of the financial assets by the Company is reasonable. However, use of different valuation models or assumptions may result in different measurement. The following is the impact to profit or loss or to other

257

comprehensive income from financial assets and liabilities categorized within Level 3 if the inputs used in valuation models have changed up or down by 1%:

December 31,2021 Financial assets at fair value through profit or loss -non-current Venture capital shares Financial assets at fair value through other comprehensive income - non- current Unlisted stocks December 31,2020	Favourable change Unfavourable change Recognised inprofit or loss	Recognised in other comprehensive income	Recognised in other comprehensive income
		Favourable change Unfavourable change - $ - $ 2,586 2,586) ( Recognised in other comprehensive income	Unfavourable change
	Not applicable Not applicable - - Favourable change Unfavourable change Recognised inprofit or loss
		Favourable change	Unfavourable change
Financial assets at fair value through profit or loss -non-current Venture capital shares Financial assets at fair value through other comprehensive income - non- current Unlisted stocks	Not applicable Not applicable - -	- $ 1,863	- $ 1,863) (

6) Capital management

A. Objective of capital management
(A) The represented capital adequacy ratio basically shall not be lower than 200% in compliance with the warning standard addressed in the “Rules Governing Securities Firms”.
(B) The Company includes all risks involved in the investment position as a part of risk management, such as market risk, credit risk, liquidity risk, operating risk, legal risk, and model risk and so on. Each risk management responsive unit should identify, evaluate, monitor and control various risks in order to enable the Company to defend impact from financial market, reflect the current operating strategies and make the investment portfolio applied to business planning and development.
B. Capital management policy and procedure
In order to secure the long-term and stable development of various businesses and effectively assume risks, the Company manages capital based on the business development, related regulations and financial market environment. Major capital evaluation processes include:
(A) Each segment should provide accurate and valid source of information to maintain calculation accuracy of capital adequacy ratio.
(B) After the reporting at the 10th of each month, capital adequacy ratio should be computed by the end of every month. If the result is close to the legal standard, every unit will be called to attend a meeting for discussion and strategic planning to ensure that the basic objective of capital adequacy ratio is not less than 200%.
(C) Both the risk limits and economic capital of the Company should be agreed by the Board of Directors. The Company should quarterly report details of risk control with disclosure of investment condition in order to assess whether the risk position exceeds the limit and whether the investment direction is in line with the market trend. Within the authorized risk

258

limits, the Company is actively engaged in development of various businesses and continually increases profit, creates company value, and complies with the capital management objective.

The Company calculates and reports the capital adequacy ratio according to “Rules Governing Securities Firms”. As of December 31, 2021 and 2020, the capital adequacy ratios were 379% and 339%, respectively, as required by the regulations.

7) Assets and liabilities of trust accounts

Pursuant to Article 17 of Enforcement Rules of the Trust Enterprise Act, balance sheet, income statement, and property list of trust accounts shall be disclosed in the parent company only financial statements on a semiannual basis.

A. Balance sheet of trust accounts

inancial statements on a semiannual basis. A. Balance sheet of trust accounts	inancial statements on a semiannual basis. A. Balance sheet of trust accounts
B. Income statement of trust accounts Trust assets December 31,2021 Bank savings 669,217 $ $ Structured notes 923,114 Stock 1,284,571 Bond 435,389 Bonds sold under repurchase agreements 23,127 Fund 5,014,866 Accounts receivable 60,575 Total of trust assets 8,410,859 $ $ Trust liabilities December 31,2021 Accounts payable 2,130 $ $ Trust capital 6,945,206 Net income 1,753,062 Cumulative loss 289,539) ( ( Total of trust liabilities 8,410,859 $ $ Item Year ended December 31,2021 Trust income Interest income 44,486 $ Cash dividends received 61,237 Income from stocks lending - Investment realized gains - bond 5,882 Investment realized gains - stock 6,967 Investment realized gains - fund 392,454 Investment realized gains - structured notes 5,699 Investment unrealized gains - bond 20,265 Investment unrealized gains - stock 671,271 Investment unrealized gains - fund 718,037 Investment unrealized gains - structured notes 1,996 other revenue 2 Subtotal 1,928,296		$	December 31,2020 492,979 664,243 928,705 423,452 21,794 3,877,584 36,087 6,444,844 December 31, 2020 1,699 5,562,920 1,099,366 219,141) 6,444,844 Year ended December 31,2020
		$


		$

	44,486 $ 61,237 - 5,882 6,967 392,454 5,699 20,265 671,271 718,037 1,996 2 1,928,296		20,430 $ 47,788 587 18,510 - 244,372 5,083 31,001 367,587 459,799 2,030 - 1,197,187

B. Income statement of trust accounts

259

==> picture [469 x 265] intentionally omitted <==

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

Year ended December Year ended December
Item 31, 2021 31, 2020
Trust expenses
Management fee ($ 1,255) ($ 1,099)
Service fee ( 1,311) ( 526)
-
Borrowing costs ( 134)
Investment realized loss - bond ( 1,393) ( 318)
Investment realized loss - stock ( 21) -
Investment realized loss - fund ( 34,002) ( 42,212)
Investment realized loss - structured notes ( 52) -
Investment unrealized loss - bond ( 14,706) ( 7,317)
Investment unrealized loss - stock ( 8,156) ( 3,427)
Investment unrealized loss - fund ( 87,619) ( 40,634)
Investment unrealized loss - structured notes ( 26,712) ( 2,164)
Income before income tax 1,753,069 1,099,356
Income tax (expense) benefit ( 7) 10
Net income $ 1,753,062 $ 1,099,366
----- End of picture text -----

C. Property list of trust accounts

==> picture [466 x 158] intentionally omitted <==

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

Item December 31, 2021 December 31, 2020
Bank savings $ 669,217 $ 492,979
Structured notes 923,114 664,243
Funds 5,014,866 3,877,584
Bond 435,389 423,452
Bonds sold under repurchase
23,127 21,794
agreements
Stock 1,284,571 928,705
Others 60,575 36,087
Total $ 8,410,859 $ 6,444,844
----- End of picture text -----

13. OTHER DISCLOSURE ITEMS

1) Information about significant transactions

A. Lending to others: Excluding security margin trading and conditional bond trading business, there is no lending of funds to either the shareholders or other parties.
B. Endorsements and guarantees for others ： None.
C. Acquisitions of real estate exceeding $300 million or 20 percent of contributed capital ： None.
D. Disposals of real estate exceeding $300 million or 20 percent of contributed capital ： None.
E. Purchases or sales transactions discount on brokers’ charges with related parties in excess of $5,000,000 ： None.
F. Receivables from related parties exceeding $100 million or 20 percent of contributed capital ： None.
G. Significant transactions between parent company and subsidiaries are provided in Note 7.

260

2) Related information of investee companies

A. Related information of investee companies

Name of the investor	Name of the investee company	Location	Date of registration	Reference number and the date of approval letter issued byFSC	Major operating activities	Balance on December 31, 2021 Original in	Balance on December 31, 2020 vestment	EndingBalance	EndingBalance		Revenue of investee company	Net income (loss) of investee company	Investment income (loss) recognised by the Company	Cash dividends	Notes
								Shares 63,817,303 30,000,000 192,600,000 23,400,000 1,000,000 14,904,630 1,000,000	Percentage 96.69% 100.00% 100.00% 100.00% 100.00% 42.46% 100.00%	Book vlaue
President Securities Corp.	President Futures Corp. President Capital Management Corp. President Securities (HK) Ltd. President Wealth Management (HK) Ltd. President Securities (Nominee) Ltd. Uni-President Asset Management Corp. President Insurance Agency Corp.	Taipei Taipei Hong Kong Hong Kong Hong Kong Taipei Taipei	1994.03.01 1997.04.15 1994.07.26 2002.03.31 1999.08.06 1992.09.03 2008.04.29	1994.03.01 Jing- Tou-Shen (83) Gong-Shang Letter No.1114 (Note 1) 1997.02.25 (86) Tai-Cai-Zheng (4) Letter No.17769 1993.11.4 (82) Tai- Cai-Zheng (2) Letter No.40913 2001.12.11 (90) Tai-Cai-Zheng (2) Letter No.166728 1997.10.27 (86) Tai-Cai-Zheng (2) Letter No.04840 2000.07.19 (89) Tai-Cai-Zheng (2) Letter No.56407 (Note2)	Futures brokerage and dealer Securities investment consulting Securities dealer, brokerage, underwriting and consulting Wealth management Nominee Service Investment Trust Insurance Agent	644,650 $ 326,000 848,735 92,091 3,403 667,622 10,000	644,650 $ 326,000 848,735 92,091 3,403 667,622 10,000			2,420,110 $ 312,175 1,288,431 54,073 1,529 760,171 46,249	854,895 $ 88,621 75,964 - - 1,411,480 85,198	119,086 $ 8,081) ( 27,343) ( 39) ( 88) ( 536,134 25,060	115,153 $ 8,074) ( 27,343) ( 39) ( 88) ( 227,661 25,069	144,227 $ - - - - 98,959 8,541	Subsidiary of the Company Subsidiary of the Company Subsidiary of the Company Subsidiary of the Company Subsidiary of the Company Associates Subsidiary of the Company

Note1 ： As FSC was established in July, 2004, President Futures Corp. was approved by the Investment Commission, Ministry of Economic Affairs.

Note2 ： When securities corporations invest in domestic business within FSC's limitation, there is no need to obtain the approval from FSC in advance, according to Tai-Cai-Zheng (2) Letter No.0930000005. Therefore, there was no reference numbers for President Personal Insurance Agency Co., Ltd. and President Insurance Agency Corp.

261

Original investment Ending Balance Reference number Investment Name of the and the date of Major Balance on Balance on Net income income (loss) Name of the investee Date of approval letter operating December 31, December 31, Revenue of (loss) of investee recognised by Cash investor company Location registration issued by FSC activities 2021 2020 Shares Percentage Book vlaue investee company company the Company dividends Notes President PSC Venture Taipei 2013.10.29 2013.08.08 JingConsultation of $ 300,000 $ 300,000 30,000,000 100.00% $ 273,064 $ 42,717 $ 30,924 $ 30,925 $ - Subsidiary of Securities Capital Guan-Zheng-Chuan investment the Company Corp. Investment Letter management and Limited No.1020028529 venture capital; Company other unprohibited or unrestricted businesses beyond the permit President Uni-President Taipei 1992.09.03 2000.07.19 (89) Investment Trust 478 478 12,000 0.03% 616 1,411,480 536,134 183 80 Associates Insurance Asset Tai-Cai-Zheng (2) Agency Corp. Management Letter No.56407 Corp.

Note3 ： President Securities (BVI) Ltd. was approved by the board of directors in March 2020 to deal with the dissolution and liquidation matters, and the dissolution was finished in September 2020. President Securities (BVI) Ltd. was not being included in the Company.

B. Lending to others: Excluding security margin trading and conditional bond trading business, there is no lending of funds to either the shareholders or other parties.
C. Endorsements and guarantees for others ： None.
D. Acquisitions of real estate exceeding $300 million or 20 percent of contributed capital ： None.
E. Disposals of real estate exceeding $300 million or 20 percent of contributed capital ： None.
F. Purchases or sales transactions discount on brokers’ charges with related parties in excess of $5,000,000 ： None.
G. Receivables from related parties exceeding $100 million or 20 percent of contributed capital ： None.
H. Accordance with Jing-Guan-Zheng-Quan-Zi Letter No. 10300375782, the Company is required to disclose details of businesses run by foreign enterprises that were incorporated in the countries identified as non-signatories to the IOSCO MMoU or have not obtained securities or futures license of signatories to the IOSCO MMoU ：
a) Revenue from engagement in consultation on assets management business, service contents and litigation ： None.

262

b) Balance sheets

PRESIDENT WEALTH MANAGEMENT (HK) LTD. BALANCE SHEETS DECEMBER 31, 2021 AND 2020

Assets		Amount % December 31,2021	Amount % December 31,2021	Amount % December 31,2021		December 31,2020	December 31,2020	December 31,2020	Expressed in HK dollars Liabilities and shareholders’equity Amount % Amount % Current liabilities Other payables 20,400 $ - 20,400 $ - Total liabilities 20,400 - 20,400 - Shareholders’ equity Share capital 23,400,000 154 23,400,000 153 Retained earnings Accumulated deficit 8,163,822) ( 54) ( 8,153,029) ( 53) ( Total shareholders’ equity 15,236,178 100 15,246,971 100 Total liabilities and shareholders’ equity 15,256,578 $ 100 15,267,371 $ 100 December 31,2021 December 31,2020	Expressed in HK dollars Liabilities and shareholders’equity Amount % Amount % Current liabilities Other payables 20,400 $ - 20,400 $ - Total liabilities 20,400 - 20,400 - Shareholders’ equity Share capital 23,400,000 154 23,400,000 153 Retained earnings Accumulated deficit 8,163,822) ( 54) ( 8,153,029) ( 53) ( Total shareholders’ equity 15,236,178 100 15,246,971 100 Total liabilities and shareholders’ equity 15,256,578 $ 100 15,267,371 $ 100 December 31,2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020
						Amount		%				Amount		%
Current assets Cash and cash equivalents Other receivables Total current assets Total assets		15,252,550 $ 4,028 15,256,578 15,256,578 $		100 - 100 100		15,254,818 $ 12,553 15,267,371 15,267,371 $		100 - 100 100		- - 154 54) ( 100 100		20,400 $ 20,400 23,400,000 8,153,029) ( 15,246,971 15,267,371 $	- - 153 53) ( 100 100

263

PRESIDENT SECURITIES (NOMINEE) LTD. BALANCE SHEETS DECEMBER 31, 2021 AND 2020

Assets		Amount % December 31,2021	Amount % December 31,2021	Amount % December 31,2021		December 31,2020	December 31,2020	December 31,2020	Expressed in HK dollars Liabilities and shareholders’equity Amount % Amount % Current liabilities Other payables 16,800 $ 4 16,800 $ 3 Total liabilities 16,800 4 16,800 3 Shareholders’ equity Share capital 1,000,000 223 1,000,000 212 Retained earnings Accumulated deficit 569,081) ( 127) ( 544,742) ( 115) ( Total shareholders’ equity 430,919 96 455,258 97 Total liabilities and shareholders’ equity 447,719 $ 100 472,058 $ 100 December 31,2021 December 31,2020	Expressed in HK dollars Liabilities and shareholders’equity Amount % Amount % Current liabilities Other payables 16,800 $ 4 16,800 $ 3 Total liabilities 16,800 4 16,800 3 Shareholders’ equity Share capital 1,000,000 223 1,000,000 212 Retained earnings Accumulated deficit 569,081) ( 127) ( 544,742) ( 115) ( Total shareholders’ equity 430,919 96 455,258 97 Total liabilities and shareholders’ equity 447,719 $ 100 472,058 $ 100 December 31,2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020
						Amount		%				Amount		%
Current assets Cash and cash equivalents Other receivables Total current assets Total assets		447,719 $ - 447,719 447,719 $		100 - 100 100		472,052 $ 6 472,058 472,058 $		100 - 100 100		4 4 223 127) ( 96 100		16,800 $ 16,800 1,000,000 544,742) ( 455,258 472,058 $	3 3 212 115) ( 97 100

264

c) Statements of comprehensive income

PRESIDENT WEALTH MANAGEMENT (HK) LTD

STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

							Expressed	Expressed	in HK dollars
		December 31,2021				December 31,2020
Accounts		Amount		%		Amount			%
Expenditures and expenses
Other operating expenses	($	41,985)		389	($	41,435)		(	44)
Total expenditures and expenses	(	41,985)		389	(	41,435)		(	44)
Non-operating gains and losses
Other gains and losses		31,191	(	289)		136,625			144
Profit before tax	(	10,794)		100		95,190			100
Income tax expense		-		-		-			-
Net income (loss)	($	10,794)		100	$	95,190			100
	PRESIDENT WEALTH MANAGEMENT (HK) LTD
	STATEMENTS OF COMPREHENSIVE INCOME
	FOR THE YEARS ENDED DECEMBER 31,			2021 AND 2020
							Expressed		in HK dollars
		December 31,2021				December 31,2020
Accounts		Amount		%		Amount			%
Expenditures and expenses
Other operating expenses	($	24,710)		102	($	23,535)			123
Total expenditures and expenses	(	24,710)		102	(	23,535)			123
Non-operating gains and losses
Other gains and losses		372	(	2)		4,337		(	23)
Profit (loss) before tax	(	24,338)		100	(	19,198)			100
Income tax expense		-		-		-			-
Net income (loss)	($	24,338)		100	($	19,198)			100

d) Transactions between related parties and foreign business ： None.

265

3) Information of overseas branches and representative office: None

4) Disclosure of investment in Mainland China

==> picture [758 x 296] intentionally omitted <==

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

Accumulated Investment
Amount remitted from Taiwan to
amount of Accumulated income (loss) Accumulated
Mainland China/ Amount
remittance amount of recognized by the Book value of amount of
remitted back to Taiwan for the
from Taiwan remittance from Ownership Company for the investments in investment
to Mainland year ended December 31, 2021 Taiwan to Net income of held by the year ended Mainland income remitted
Investee in Investment China as of Remitted to Mainland China investee as of Company December 31, China as of back to Taiwan
Mainland Main business Paid-in capital method January 1, Mainland Remitted back to as of December December 31, (direct or 2021 December 31, as of December
China activities (Note 4) (Note 1) 2021 China Taiwan 31, 2021 2021 indirect) (Note 2) 2021 31, 2021
Jin Yuan Securities brokering, $5,212,800 Directly $ 2,481,388 $ - $ - $ 2,481,388 ($ 305,071) 49% ($ 149,485) $ 2,363,197 $ -
President securities dealing, invest in a The financial
Securities securities company in statements that
Co.,Ltd. underwriting and Mainland
are audited by
sponsoring service China international
accounting firm
which has
cooperative
relationship with
accounting firm in
R.O.C.
Investment amount approved by Ceiling on investments in
Accumulated amount of remittance from
the Investment Commission of Mainland China imposed
Company name Taiwan to Mainland China as of December
the Ministry of Economic by the Investment
31, 2021
Affairs (MOEA) Commission of MOEA
Jin Yuan President Securities Co.,Ltd. $ 2,481,388 $ 2,481,388 $ 19,059,978
----- End of picture text -----

Note 1: Investment methods are classified into the following three categories; fill in the number of category each case belongs to:

(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. (Please indicate investment company in the third area.)
(3) Others.

266

Note 2: In the ‘Investment income (loss) recognized by the Company for the year ended December 31, 2021’ column:

(1) It should be indicated if the investee was still in the incorporation arrangements and had not yet any profit during this period.
(2) Indicate the basis for investment income (loss) recognition in the number of one of the following three categories:.
a. The financial statements that are audited and attested by international accounting firm which has cooperative relationship with accounting firm in R.O.C.
b. The financial statements that are audited and attested by R.O.C. parent company's CPA.
c. Others.

Note 3: The numbers in this table are expressed in New Taiwan Dollars.

Note 4: The paid-in capital of Jin Yuan President Securities Co., Ltd. is CNY 1.2 billion.

5) Major shareholder information

==> picture [746 x 43] intentionally omitted <==

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

Major shareholder Number of shares held (thousands) Shareholding ratio
Uni-President Enterprises Corp. 417,517 28.67%
----- End of picture text -----

Note 1: The information of major shareholders in this table is based on the last business day of the end of each quarter by Taiwan Depository and Clearing Corp., which determines shareholders holding more than 5% of ordinary shares and special shares of securities firms that have completed unregistered delivery (including treasury shares). As for the share capital recorded in the financial report of the securities firm and the actual number of shares delivered by the securities firm without physical registration, there may be differences due to different calculation bases.
Note 2: In the case of the above information, if a shareholder delivers shares to the trust, it is disclosed in individual accounts by the trustee who opened the trust account by the trustee. As for the shareholders’ declaration of insider’s shareholding in accordance with the Securities and Exchange Act, their shareholding includes their own shareholding plus the shares delivered to the trust and the right to use the trust property. For information on insider’s equity declaration, please refer to the Market Observation Post System.

267

PRESIDENT SECURITIES CORPORATION AND

SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND

INDEPENDENT AUDITORS’ REPORT DECEMBER 31, 2021 AND 2020

268

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

PWCR21003286

To the Board of Directors and Shareholders of PRESIDENT SECURITIES CORPORATION Opinion

We have audited the accompanying consolidated balance sheets of President Securities Corporation and subsidiaries (the “Group”) as at December 31, 2021 and 2020, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Firms, and Regulations Governing the Preparation of Financial Reports by Futures Commission Merchants, and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the Group’s 2021 consolidated financial statements. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

Key audit matters for the Group’s 2021 consolidated financial statements are stated as follows:

269

Fair value measurement of unlisted stocks without active market

Description

Please refer to Note 4(8) for the accounting policies on unlisted stocks without active market (shown as “financial assets at fair value through other comprehensive income”) and Note 5(2) for details of critical accounting judgements, estimates and assumption uncertainty. As at December 31, 2021, the unlisted stocks without active market held by the Group totaled 1,137,756 thousand New Taiwan Dollars and were shown as “financial assets at fair value through other comprehensive income” (Level 3 fair value).

Due to the lack of an active market, the fair value of the unlisted stocks held by the Group was determined using valuation method. Management measured their fair value by using comparable listed companies in the market approach. The main assumptions of the market approach are calculated based on the latest published price-to-book ratio of comparable listed companies in similar industries and considering discounts on market liquidity or assessment of risk.

Above-mentioned estimation of fair value involves various assumptions and material unobservable inputs, which has high uncertainty and relies on the subjective judgement of management. Any changes in judgements and estimates may affect the ultimate result of accounting estimates and have an impact on the financial statements of the Group. Thus, we have included the fair value measurement of unlisted stocks without active market as a key audit matter in our audit.

How our audit addressed the matter

We performed the following audit procedures on the above key audit matter:

Obtained an understanding and assessed policy documents, internal control system, fair value measurement models and approval processes that are related to fair value measurement of unlisted stocks;
Ascertained whether the measurement methods used by the management is commonly used by the industry;
Assessed the reasonableness of parameter of similar companies used by management;
Examined inputs and calculation formulas used in valuation models and agreed such data to supporting documents.

270

Impairment assessment of investments accounted for under the equity method

Description

Please refer to Note 4(14) for accounting policies on investments accounted for under the equity method and its impairment, Note 5(2) for the uncertainty of accounting estimates and assumptions applied on asset impairment, and Note 6(12) for details of investments accounted for under the equity method.

The Group held 42.49% of equity of Uni-President Asset Management Corp. which was accounted for under the equity method, and the excess of the carrying amount over the share of the investee company’s net assets is mainly goodwill. As of December 31, 2021, the amount was 760,787 thousand New Taiwan Dollars. Impairment assessment is based on the expected future cash flow of the investee, discounted at an appropriate discount rate, to measure the recoverable amount of the cash generating unit.

The recoverable amount of the investee is based on its expected future cash flows which involve multiple estimates and assumptions on discount rate and financial forecast. These are subjective judgements, have a high degree of uncertainties, and are material to the recoverable amount. Thus, we consider the impairment assessment of investments accounted for under the equity method as one of the matters of most significance to our audit.

How our audit addressed the matter

We performed the following audit procedures on the above key audit matter:

Obtained the impairment assessment report prepared by an external valuation expert who was commissioned by the management;
Assessed the reasonableness of expected future cash flows, discount rate and other significant assumptions applied in the cash flow model;
Inspected valuation model parameters, formula setting and the accuracy of calculation.

Other matter – Parent company only financial reports

We have audited and expressed an unqualified opinion on the parent company only

financial statements of President Securities Corporation, as at and for the years ended December 31, 2021 and 2020.

271

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Firms, Regulations Governing the Preparation of Financial Reports by Futures Commission Merchants, and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statement that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including the audit committee, are responsible for overseeing the Group’s financial reporting process.

Auditors’ responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the generally accepted auditing standards in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

272

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

273

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Lin, Se-Kai

Independent Auditors

Lo, Chiao-Sen

For and on behalf of PricewaterhouseCoopers, Taiwan March 8, 2022

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying consolidated financial statements are not intended to present the financial position and finance performance 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’ 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.

274

PRESIDENT SECURITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Assets	December 31, 2021 AMOUNT % `$` `5,757,012` `5` `33,582,989` `29` `410,205` `-` `27,401` `-` `18,344,751` `16` `29,930` `-` `24,933` `-` `1,581,993` `1` `21,335,532` `18` `401,019` `-` `1,437,295` `1` `819` `-` `16,727,693` `14` `1,147` `-` `25,012` `-` `33,289` `-` `1,974` `-` `8,962,046` `8` `108,685,040` `92` `76,724` `-` `1,137,756` `1` `3,123,984` `3` `2,447,128` `2` `204,621` `-` `268,402` `1` `195,468` `-` `160,587` `-` `1,388,189` `1` `9,002,859` `8` `$` `117,687,899` `100`	December 31, 2020	December 31, 2020
	AMOUNT `$` `5,757,012` `33,582,989` `410,205` `27,401` `18,344,751` `29,930` `24,933` `1,581,993` `21,335,532` `401,019` `1,437,295` `819` `16,727,693` `1,147` `25,012` `33,289` `1,974` `8,962,046` `108,685,040` `76,724` `1,137,756` `3,123,984` `2,447,128` `204,621` `268,402` `195,468` `160,587` `1,388,189` `9,002,859` `$` `117,687,899`	AMOUNT `$` `5,124,862` `41,611,722` `353,510` `-` `12,248,272` `51,532` `42,889` `1,288,127` `21,106,170` `240,796` `1,007,090` `737` `18,852,396` `875` `24,300` `23,950` `28` `3,344,627` `105,321,883` `67,484` `707,616` `3,134,766` `2,453,712` `203,579` `270,503` `151,765` `103,749` `1,296,708` `8,389,882` `$` `113,711,765`	%
110000 Current assets 111100 Cash and cash equivalents 112000 Financial assets at fair value through profit or loss - current 113200 Financial assets at fair value through other comprehensive income - current 114010 Bonds purchased under resale agreements 114030 Margin loans receivable 114040 Refinancing security deposits 114050 Receivables from refinance guaranty 114060 Receivable of securities business money lending 114070 Customer margin account 114090 Receivables from security lending 114100 Security lending deposits 114110 Notes receivable 114130 Accounts receivable 114140 Accounts receivable-related parties 114150 Prepayments 114170 Other receivables 114600 Current tax assets 119000 Other current assets 110000 Total current assets 120000 Non-current assets 122000 Financial assets at fair value through profit or loss - non-current 123200 Financial assets at fair value through other comprehensive income - non- current 124100 Investments accounted for under the equity method 125000 Property and equipment, net 125800 Right-of-use assets 126000 Investment property 127000 Intangible assets 128000 Deferred tax assets 129000 Other assets - non-current 120000 Total non-current assets 906001 Total Assets			`4` `37` `-` `-` `11` `-` `-` `1` `19` `-` `1` `-` `17` `-` `-` `-` `-` `3`
			`93`
			`-` `1` `3` `2` `-` `-` `-` `-` `1`
			`7`
			`100`

(Continued)

275

PRESIDENT SECURITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	December 31, 2021 AMOUNT % `$` `590,000` `1` `8,648,558` `7` `8,172,602` `7` `9,643,040` `8` `1,202,587` `1` `1,559,162` `1` `1,969,207` `2` `21,328,174` `18` `97,996` `-` `18,338,212` `16` `4,037` `-` `5,742,100` `5` `2,627,923` `2` `4,983,139` `4` `647,642` `1` `70,740` `-` `83,848` `-` `85,708,967` `73` `14,079` `-` `125,840` `-` `3,098` `-` `69,285` `-` `212,302` `-` `85,921,269` `73` `14,558,313` `13` `91,261` `-` `3,487,748` `3` `8,314,199` `7` `3,922,562` `3` `1,309,501` `1` `31,683,584` `27` `83,046` `-` `31,766,630` `27` `$` `117,687,899` `100`	December 31, 2020	December 31, 2020
	AMOUNT `$` `590,000` `8,648,558` `8,172,602` `9,643,040` `1,202,587` `1,559,162` `1,969,207` `21,328,174` `97,996` `18,338,212` `4,037` `5,742,100` `2,627,923` `4,983,139` `647,642` `70,740` `83,848` `85,708,967` `14,079` `125,840` `3,098` `69,285` `212,302` `85,921,269` `14,558,313` `91,261` `3,487,748` `8,314,199` `3,922,562` `1,309,501` `31,683,584` `83,046` `31,766,630` `$` `117,687,899`	AMOUNT `$` `946,276` `7,298,896` `2,624,419` `19,096,165` `1,381,470` `1,809,955` `903,852` `21,087,134` `28,105` `19,178,484` `5,142` `1,101,065` `2,116,413` `6,008,310` `332,075` `86,697` `83,230` `84,087,688` `8,627` `111,621` `9,933` `14,414` `144,595` `84,232,283` `13,998,378` `91,261` `3,111,013` `7,600,316` `3,771,859` `834,488` `29,407,315` `72,167` `29,479,482` `$` `113,711,765`	%
210000 Current liabilities 211100 Short-term loans 211200 Commercial papers payable 212000 Financial liabilities at fair value through profit or loss - current 214010 Bonds sold under repurchase agreements 214040 Deposits on short sales 214050 Short sale proceeds payable 214070 Guarantee deposit received on borrowed securities 214080 Futures traders' equity 214090 Equity for each customer in the account 214130 Accounts payable 214150 Advance receipts 214160 Collections on behalf of third parties 214170 Other payables 214200 Other financial liabilities - current 214600 Current tax liability 216000 Current lease liabilities 219000 Other current liabilities 210000 Total current liabilities 220000 Non-current liabilities 225100 Non-current provisions 226000 Non-current lease liabilities 228000 Deferred tax liabilities 229000 Other liabilities-non-current 220000 Total non-current liabilities 906003 Total Liabilities 300000 Equity attributable to owners of the parent company 301000 Capital 301010 Common stock 302000 Capital reserve 304000 Retained earnings 304010 Legal reserve 304020 Special reserve 304040 Unappropriated earnings 305000 Other equity interest 300000 Total 306000 Non-controlling interests 906004 Total Equity 906002 Total liabilities and equity			`1` `6` `2` `17` `1` `2` `1` `19` `-` `17` `-` `1` `2` `5` `-` `-` `-`
			`74`
			`-` `-` `-` `-`
			`-`
			`74`
			`12` `-` `3` `7` `3` `1`
			`26`
			`-`
			`26`
			`100`

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

276

PRESIDENT SECURITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

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

Items Year ended December 31
2021
2020
Notes
AMOUNT
%
AMOUNT
%
6(30)
$
5,027,229
43
$
3,331,030
35
6(31)
104,035
1
76,506
1
32,127
-
22,312
-
6(32)
8,731,043
75
3,356,129
35
85,749
1
77,666
1
6(33)
1,198,206
10
1,118,658
12
457,445
4
385,051
4
6(34)
(
831,627) (
7)
989,219
10
6(35)
(
181,893) (
1)
268,439
3
6(36)
(
313,159) (
3) (
117,021) (
1)
6(37)
-
-
100,358
1
76,579
1 (
83,151) (
1)
17,312
-
2,870
-
6(38)
(
2,896,956) (
25)
95,405
1
6(39)
(
640,393) (
5)
20,120
-
6(40)
10,976
- (
15,979)
-
6(41)
744,946
6 (
46,340) (
1)
11,621,619
100
9,581,272
100
6(42)
(
755,578) (
7) (
548,487) (
6)
(
6,863)
- (
5,658)
-
6(43)
(
101,287) (
1) (
276,884) (
3)
(
86,289) (
1) (
100,691) (
1)
(
140,732) (
1) (
123,083) (
1)
(
3,062)
- (
26)
-
6(44)
(
4,002,344) (
34) (
3,202,336) (
33)
6(45)
(
227,553) (
2) (
209,839) (
2)
6(46)
(
2,030,357) (
17) (
1,507,158) (
16)
(
7,354,065) (
63) (
5,974,162) (
62)

400000 Revenues
401000
Brokerage handling fee revenue
404000
Revenues from underwriting
business
406000
Net gain (loss) on wealth
management
410000
Net gain (loss) on sale of operating
securities
421100
Revenue from providing agency
service for stock affairs
421200
Interest income
421300
Dividend income
421500
Net valuation gain (loss) on
operating securities at fair value
through profit or loss
421600
Net gain (loss) on covering of
borrowed securities and bonds with
resale agreements-short sales
421610
Net valuation gain (loss) on
borrowed securities and bonds with
resale agreements-short sales at fair
value through profit or loss
421750
Realized gain (loss) on financial
assets measured at fair value through
other comprehensive income - bonds
422000
Net gain (loss) on issuance of ETNs
422100
Administrative and handling fee
revenues from issuance of ETNs
422200
Net gain (loss) from issuance of call
(put) warrants
424400
Net gain (loss) from derivatives
425300
Impairment loss and reversal of
impairment gain
428000
Other operating income
Total revenues
500000 Expenditures and expenses
501000/
502000/
503000
Handling charges
507000
ETNs administrative expenses
521200
Interest expenses
524100
Futures commission expense
524300
Expense of clearing and settlement
528000
Other operating expenditure
531000
Employee benefits expense
532000
Depreciation and amortization
533000
Other operating expenses
Total expenditures and expenses

(Continued)

277

PRESIDENT SECURITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

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

Items	YearendedDecember 31	YearendedDecember 31
	2021	2020
Operating profit 601000 Share of the profit or loss of associates and joint ventures accounted for under the equity method 602000 Other gains and losses 902001Profit before tax 701000 Income tax expense 902005Net income Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 805510 Remeasurements of defined benefit plans 805540 Net unrealized gain (loss) from investments in equity instruments at fair value through other comprehensive income 805550 Other comprehensive gain (loss) of associates and joint ventures accounted for under the equity method 805599 Income tax benefit relating to components of other comprehensive income Items may be reclassified to profit or loss subsequently 805610 Translation gain (loss) on the financial statements of foreign operating entities 805615 Net unrealized gain (loss) from investments in debt instruments at fair value through other comprehensive income 805000 Current other comprehensive income (post-tax) 902006Total current comprehensive income Income attributable to: 913100 Parent company 913200 Non-controlling interest Current comprehensive income attributable to: 914100 Parent company 914200 Non-controlling interests Earnings per share 975000 Basic earnings per share (in dollars) 985000 Diluted earnings per share (in dollars)
		`$`

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

278

PRESIDENT SECURITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Notes				Equity attributable	Equity attributable	to owners of the parent	to owners of the parent	to owners of the parent	to owners of the parent
	Common stock	Capital reserve		R	etained Earnings		Other equityinterest				Total
			Legal reserve		Special reserve	Unappropriated earnings	Translation gain and loss on the financial statements of foreign operating entities	a f	Unrealised gain or loss on financial ssets measured at air value through other comprehensive income
6(29) 6(29)	`$ 13,723,900` `-` `-` `-` `-` `-` `-` `274,478` `-` `-` `$ 13,998,378` `$ 13,998,378` `-` `-` `-` `-` `-` `-` `559,935` `-` `$ 14,558,313`	`$ 91,261` `-` `-` `-` `-` `-` `-` `-` `-` `-` `$ 91,261` `$ 91,261` `-` `-` `-` `-` `-` `-` `-` `-` `$ 91,261`	`$ 2,876,769` `-` `-` `-` `234,244` `-` `-` `-` `-` `-` `$ 3,111,013` `$ 3,111,013` `-` `-` `-` `376,735` `-` `-` `-` `-` `$ 3,487,748`		`$ 7,130,830` `-` `-` `-` `-` `469,486` `-` `-` `-` `-` `$ 7,600,316` `$ 7,600,316` `-` `-` `-` `-` `713,883` `-` `-` `-` `$ 8,314,199`	`$ 2,355,105` `3,607,518` `(` `17,197 )` `3,590,321` `(` `234,244 )` `(` `469,486 )` `(` `1,372,390 )` `(` `274,478 )` `177,031` `-` `$ 3,771,859` `$ 3,771,859` `4,007,435` `(` `106,422 )` `3,901,013` `(` `376,735 )` `(` `713,883 )` `(` `2,099,757 )` `(` `559,935 )` `-` `$ 3,922,562`	`($` `58,216 )` `-` `27,298` `27,298` `-` `-` `-` `-` `-` `-` `($` `30,918 )` `($` `30,918 )` `-` `(` `34,891 )` `(` `34,891 )` `-` `-` `-` `-` `-` `($` `65,809 )`	`$` `580,031` `-` `462,406` `462,406` `-` `-` `-` `-` `(` `177,031 )` `-` `$` `865,406` `$` `865,406` `-` `509,904` `509,904` `-` `-` `-` `-` `-` `$ 1,375,310`		`$ 26,699,680` `3,607,518` `472,507` `4,080,025` `-` `-` `(` `1,372,390 )` `-` `-` `-` `$ 29,407,315` `$ 29,407,315` `4,007,435` `368,591` `4,376,026` `-` `-` `(` `2,099,757 )` `-` `-` `$ 31,683,584`		`$ 66,092` `7,078` `2,839` `9,917` `-` `-` `-` `-` `-` `(` `3,842 )` `$ 72,167` `$ 72,167` `3,938` `11,874` `15,812` `-` `-` `-` `-` `(` `4,933 )` `$ 83,046`	`$ 26,765,772` `3,614,596` `475,346` `4,089,942` `-` `-` `(` `1,372,390` `)` `-` `-` `(` `3,842` `)` `$ 29,479,482` `$ 29,479,482` `4,011,373` `380,465` `4,391,838` `-` `-` `(` `2,099,757` `)` `-` `(` `4,933` `)` `$ 31,766,630`

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

279

PRESIDENT SECURITIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax
Adjustments
Income and expenses having no effect on cash flows
Net valuation (gain) loss on operating securities at fair value
through profit or loss

Net valuation (gain) loss on borrowed securities and bonds
with resale agreements-short sales at fair value through profit
or loss

Impairment loss and reversal of impairment gain

Depreciation

Amortization

Interest expense

Interest income (include financial income)

Dividend income
Share of the profit of associates and joint ventures accounted
for under the equity method
(Gain) loss on disposal of property and equipment

(Gain) loss from lease modification
(Gain) loss on valuation of non-operating financial
instrument

Changes in assets/liabilities relating to operating activities
Net changes in operating assets
Financial assets at fair value through profit or loss - current
Financial assets at fair value through other comprehensive
income - current
Bonds purchased under resale agreements
Margin loans receivable
Refinancing security deposits
Receivables from refinance guaranty
Receivable of securities business money lending
Customer margin account
Receivables from security lending
Security lending deposits
Notes receivable
Accounts receivable
Accounts receivable-related parties
Prepayments
Other receivables
Other current assets
Net changes in liabilities relating to operating activities
Financial liabilities at fair value through profit or loss
Bonds sold under repurchase agreements
Deposits on short sales
Short sale proceeds payable
Guarantee deposit received on borrowed securities
Futures traders’ equity
Equity for each customer in the account
Accounts payable
Advance receipts
Collections on behalf of third parties
Other payables
Other financial liabilities - current
Other current liabilities Year ended December 31
Notes
2021
2020
$
4,669,435 $
3,982,822
6(2)(34)
831,627 (
989,219 )
6(36)
313,159
117,021
6(40)
(
7,664 )
18,181
6(45)
189,361
181,478
6(45)
38,192
28,361
6(43)
101,287
276,884
6(33)(47)
(
1,309,993 ) (
1,273,261 )
(
487,052 ) (
407,049 )
(
78,359 ) (
68,825 )
6(13)
3
154
(
17 )
-
6(47)
24,318 (
25,279 )
7,161,039
3,904,263
- (
13,884 )
(
27,401 )
-
(
6,085,072 ) (
2,239,117 )
21,602
51,013
17,956
45,870
(
293,866 ) (
770,318 )
(
229,362 ) (
7,370,458 )
(
160,223 ) (
139,753 )
(
430,205 ) (
463,919 )
(
82 ) (
40 )
2,159,195 (
7,111,640 )
(
272 )
128
(
712 ) (
1,743 )
(
8,801 )
73,236
(
5,617,419 ) (
1,722,930 )
5,235,024
1,658,769
(
9,453,125 ) (
1,860,091 )
(
178,883 ) (
177,247 )
(
250,793 ) (
78,877 )
1,065,355
847,848
241,040
7,373,467
69,891
27,472
(
778,723 )
7,115,640
(
1,105 )
2,769
4,641,035
722,772
511,276
769,620
(
1,025,171 )
3,264,444
618
61,337

(Continued)

280

PRESIDENT SECURITIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Cash inflow generated from operations
Interest received
Dividends received
Income tax paid
Net cash flows from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of investments accounted for under equity method
Acquisition of property and equipment

Proceeds from disposal of property and equipment
Acquisition of intangible assets

Proceeds from disposal of intangible assets
(Increase) decrease in other non-current assets
(Increase) decrease in prepayment for equipment
Net cash flows used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term loans
Increase (decrease) in commercial papers payable
Increase (decrease) in other non-current liabilities
Payments of lease liabilities
Interest paid
Distribution of cash dividends
Changes in non-controlling interest
Net cash flows used in financing activities
Effect of exchange rate changes
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year Year ended December 31
Notes
2021
2020
$
867,113 $
5,809,899
1,219,615
1,353,284
585,425
505,200
(
382,965 ) (
205,923 )
2,289,188
7,462,460
- (
2,481,388 )
6(13)
(
52,406 ) (
36,654 )
54
177
6(17)
(
46,025 ) (
17,887 )
-
31
(
88,658 ) (
99,626 )
(
139,960 ) (
78,687 )
(
326,995 ) (
2,714,034 )
(
356,276 ) (
2,018,684 )
1,350,000 (
2,300,000 )
(
1,982 ) (
2,965 )
(
93,325 ) (
92,782 )
(
108,079 ) (
288,944 )
(
2,099,757 ) (
1,372,390 )
(
4,933 ) (
3,842 )
(
1,314,352 ) (
6,079,607 )
(
15,691 ) (
64,103 )
632,150 (
1,395,284 )
5,124,862
6,520,146
$
5,757,012 $
5,124,862

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

281

PRESIDENT SECURITIES CORPORATION AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

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

1. HISTORY AND ORGANIZATION

1) President Securities Corporation (the “Company”) was incorporated as a company limited by shares under the provisions of the Company Law of the Republic of China (R.O.C.) on December 17, 1988 and was renamed as President Securities Corporation on March 4, 1989. The Company started commercial operations on April 3, 1989. As of December 31, 2021, the Company had 31 operating branches (including the Head Office), and established Offshore Securities Unit in July 2014.
2) The Company and its subsidiaries (collectively referred herein as the “Group”) are primarily engaged in underwriting of securities, dealing or brokerage business of securities at the securities exchange markets and business premises, registration and transfer agency service for securities, margin loans and short sales business of securities, securities lending and borrowing business, futures introducing brokerage services, futures dealing, issuance of call (put) warrants, new financial instrument transactions, wealth management business, and trust business.
3) The Company’s shares are listed on the Taiwan Stock Exchange.
4) The number of employees of the Group were 1,716 and 1,703 as of December 31, 2021 and 2020, respectively.
THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION
These consolidated financial statements were authorized for issuance by the Board of Directors on March 8, 2022.
APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS 1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

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

Effective Date by International Accounting New Standards, Interpretations and Amendments Standards Board Amendments to IFRS 4, ‘Extension of the temporary exemption January 1, 2021 from applying IFRS 9’

282

Effective Date by International Accounting New Standards, Interpretations and Amendments Standards Board Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘ January 1, 2021 Interest Rate Benchmark Reform— Phase 2’ Amendment to IFRS 16,‘Covid-19-related rent concessions April 1, 2021(Note) beyond 30 June 2021’

Note ： Earlier application from January 1, 2021 is allowed by FSC.

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

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

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

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

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

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

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

IFRSs issued by IASB but not yet endorsed by the FSC New standards, interpretations and amendments issued by IASB but IFRSs as endorsed by the FSC are as follows:	not yet included in the
New Standards,Interpretations and Amendments Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets between an investor and its associate or joint venture’ IFRS 17, ‘Insurance contracts’	Effective Date by International Accounting Standards Board
	To be determined by International Accounting Standards Board January 1, 2023

283

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

New Standards,Interpretations and Amendments	Standards Board
Amendments to IFRS 17, 'Insurance contracts'	January 1, 2023
Amendment to IFRS 17, 'Initial application of IFRS 17 and IFRS 9 - comparative information'	January 1, 2023
Amendments to IAS 1, ‘ Classification of liabilities as current or non-current’	January 1, 2023
Amendments to IAS 1, ‘Disclosure of accounting policies’	January 1, 2023
Amendments to IAS 8, ‘Definition of accounting estimates’	January 1, 2023
Amendments to IAS 12, ‘ Deferred tax related to assets and liabilities arising from a single transaction’	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.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

1) Compliance statement

The consolidated financial statements of the Group have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Firms, and Regulations Governing the Preparation of Financial Reports by Futures Commission Merchants, and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

2) Basis of preparation
A. Except for the following items, these consolidated financial statements have been prepared under the historical cost convention:
- (A) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.
- (B) Financial assets at fair value through other comprehensive income.
- (C) Defined benefit assets or liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligations.
B. The preparation of financial statements in conformity with 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.

284

3) Basis of consolidation
A. Basis for preparation of consolidated financial statements:
- (A) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries are all entities (including structured entities) controlled by the Group. The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries.
- (B) Intercompany transactions, balances and unrealized gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group.
- (C) Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.
- (D) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are accounted for as equity transactions, i.e. transactions with owners in their capacity as owners. Any difference between the amount by which the noncontrolling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity.
- (E) When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. That fair value is regarded as the fair value on initial recognition of a financial asset or the cost on initial recognition of the associate or joint venture. Any difference between fair value and carrying amount is recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary are reclassified to profit or loss, on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

285

B. Subsidiaries included in the consolidated financial statements:

Name of Investor	Name of Subsidiary	Main Business Activities Futures brokerage and dealer Securities investment consulting Securities dealer, brokerage, underwriting and consulting Securities investment and holding company Insurance Agent Consultation of investment management and venture capital; other unprohibited or unrestricted businesses beyond the permit Wealth management Nominee Service	Ownership (%)	Ownership (%)
			December 31,2021 96.69% 100% 100% - (Note 2) 100% 100% 100% 100%	December 31,2020
The Company `〃` `〃` `〃` `〃` `〃` `〃` `〃`	President Futures Corp. (President Futures) President Capital Management Corp. (President Capital Management) President Securities (HK) Ltd.(President Securities (HK)) (Note 1) President Securities (BVI) Ltd.(President Securities (BVI)) President Insurance Agency Corp. (President Insurance Agency) PSC Venture Capital Investment Company Limited (President Venture Capital) President Wealth Management(HK) Ltd.(President Wealth Management (HK)) (Note 1) President Securities (Nominee) Ltd. (President Securities (Nominee)) (Note 1)			96.69% 100% 100% 100% 100% 100% 100% 100%

Note 1: In July 2020, the company acquired equity in the overseas reinvestment business invested by President Securities (BVI). Currently, the company holds 100% equity of President Securities (HK), President Wealth Management (HK) and President Securities (Nominee).
Note 2:The dissolution and liquidation of President Securities (BVI) was approved by the Board of Directors in March 2020, and the liquidation was completed in September 2021, so it was stopped to be included in the consolidated entity.

286

4) Classification of current and non-current items
A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets:
- (A) Assets arising from operating activities that are expected to be realized, or are intended to be sold or consumed within the normal operating cycle;
- (B) Assets held mainly for trading purposes;
- (C) Assets that are expected to be realized within twelve months from the balance sheet date;
- (D) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.
B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:
- (A) Liabilities that are expected to be paid off within the normal operating cycle;
- (B) Liabilities arising mainly from trading activities;
- (C) Liabilities that are to be paid off within twelve months from the balance sheet date;
- (D)Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.
5) Translation of foreign currency transactions
A. Foreign currency translation and presentation
- Items included in the consolidated financial statements of the Group are measured using the currency of the primary economic environment in which the Group operates (the “functional currency”). Functional currency and bookkeeping currency of the Company and its domestic subsidiaries are all New Taiwan Dollars; functional currency and bookkeeping currency of overseas subsidiaries-President Securities (HK), President Wealth Management (HK), and President Securities (Nominee) are Hong Kong Dollars; and functional currency and bookkeeping currency of President Securities (BVI) are US Dollars. The consolidated financial statements are presented in New Taiwan Dollars.
B. Foreign currency transactions and balances
- Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated by the closing exchange rate at balance sheet date. The closing exchange rate is determined by the market exchange rate. Non-monetary assets and liabilities denominated in foreign currencies which are carried at historical cost are translated by the exchange rates prevailing at the original transaction date. Non-monetary assets and liabilities

287

denominated in foreign currencies held at fair value through profit or loss are retranslated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in other comprehensive income.

C. Translation of foreign operations

The operating results and financial position of all the group entities, associates and joint arrangements that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

  - (A) Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet;

  - (B) Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period; and

  - (C) All resulting exchange differences are recognized in other comprehensive income.

6) Cash and cash equivalents
A. In the consolidated statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with banks, and other short-term highly liquid investments.
B. Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits that meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.
7) Financial assets at fair value through profit or loss
A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortized cost or fair value through other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognized and derecognized using trade date accounting.
C. At initial recognition, the Group measures the financial assets at fair value and recognizes the transaction costs in profit or loss. The Group subsequently measures the financial assets at fair value, and recognizes the gain or loss in profit or loss.
D. The Group recognizes the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.
8) Financial assets at fair value through other comprehensive income
A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Group has made an irrevocable election at initial recognition to recognize changes in fair value in other

288

comprehensive income and debt instruments which meet all of the following criteria:

  - (a)The objective of the Group’s business model is achieved both by collecting contractual cash flows and selling financial assets; and

  - (b)The assets’ contractual cash flows represent solely payments of principal and interest.

B. On a regular way purchase or sale basis, available-for-sale financial assets are recognized and derecognized using trade date accounting.
C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs. The Group subsequently measures the financial assets at fair value:
- (A) The changes in fair value of equity investments that were recognized in other comprehensive income are reclassified to retained earnings and are not reclassified to profit or loss following the derecognition of the investment. Dividends are recognized as revenue when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.
- (B) Except for the recognition of impairment loss, interest income and gain or loss on foreign exchange which are recognized in profit or loss, the changes in fair value of debt instruments are taken through other comprehensive income. When the financial asset is derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss.
9) Notes and accounts receivable, other receivables and margin loans receivable
A. Accounts and notes receivable and margin loans receivables entitle the Group a legal right to receive consideration in exchange for transferred goods or rendered services.
B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.
10) Bonds sold under repurchase agreements and bonds purchased under resale agreements Bond transactions under repurchase or resale agreements are stated at the amount of actual payment or receipt. When transactions of bonds with a condition of resale agreements occur, the actual payment or receipt shall be recognized in ‘bonds purchased under resale agreements’ under current assets. When transactions of bonds with a condition of repurchase agreements occur, the actual payment or receipt shall be recognized in ‘bonds sold under repurchase agreements’ under current liabilities. Any difference between the actual payment/receipt and predetermined redemption (repurchase) price is recognized in interest income or interest expense.

11) Impairment of financial assets

For debt instruments measured at fair value through other comprehensive income, at each reporting date, the Group recognizes the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognizes the impairment provision for the lifetime expected credit losses

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(ECLs) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable or contract assets that do not contain a significant financing component, the Group recognizes the impairment provision for lifetime ECLs.

12) Derecognition of financial instruments
A. Derecognition of financial assets
- The Group derecognizes a financial asset when one of the following conditions is met:
- (A) The contractual rights to receive cash flows from the financial asset expire.
- (B) The contractual rights to receive cash flows from the financial asset have been transferred and the Group has transferred substantially all risks and rewards of ownership of the financial asset.
- (C) The contractual rights to receive cash flows of the financial asset have been transferred; however, the Group has not retained control of the financial asset.
B. Derecognition of financial liabilities
- A financial liability is derecognized when the obligation under the liability specified in the contract is discharged or cancelled or expired.

13) Offsetting financial instruments

14) Investments accounted for under the equity method-associates
A. Associates are all entities over which the Group has significant influence but not control. In general, it is presumed that the investor has significant influence, if an investor holds, directly or indirectly 20 percent or more of the voting power of the investee. Investments in associates are accounted for using the equity method and are initially recognized at cost.
B. The Group’s share of its associates’ post-acquisition profits or losses is recognized in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognize further losses, unless it has incurred statutory/constructive obligations or made payments on behalf of the associate.
C. When changes in an associate’s equity that are not recognized in profit or loss or other comprehensive income of the associate and such changes not affecting the Group’s ownership percentage of the associate, the Group recognizes its share of change in equity of the associate in ‘capital reserve’ in proportion to its ownership.
D. Unrealized gains on transactions between the Group and its associates are eliminated

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to the extent of the Group’s interest in the associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Group.

E. When there are objective evidences of impairment, at balance sheet date, the Group considers the whole investment carrying amount as single asset, and compares its recoverable amount (value in use or fair value less costs of disposal) with the carrying amount, to test its impairment. Value in use is determined by the present value of the Group’s share of the expected future cash flow from the associates. If the recoverable amount is less than its carrying amount, an impairment loss should be recognized. The loss will not be allocated to any of the components (including goodwill), which comprise the carrying amount of the investment. An impairment loss recognized in prior periods shall be reversed if circumstances of impairment no longer exist or have decreased.

15) Property and equipment

A. Property and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized.
B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.
C. Land is not depreciated. Other property and equipment are subsequently measured using the cost model and depreciated using the straight-line method to allocate their cost over their estimated useful lives.
D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each balance sheet date. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change. The estimated useful lives of property and equipment are as follows:

of the change. The estimated useful lives	of property
Buildings Furniture and fixtures Computer equipment Electrical equipment Leasehold improvements	Useful lives
	5~50 years 4~10 years 3~5 years 3~10 years 5 years

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E. When an asset is sold or retired, the cost and accumulated depreciation are removed from the respective accounts and the resulting gain or loss is included in current operations.
16) Leasing arrangements (lessee) － right-of-use assets/ lease liabilities
A. Leases are recognized as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for use by the Group. For short-term leases or leases of low value assets, lease payments are recognized as an expense on a straightline basis over the lease term.
B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are mainly comprised of fixed payments.
- The Group subsequently measures the lease liability at amortized cost using the interest method and recognizes interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognized as an adjustment to the right-of-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.
C. At the commencement date, the right-of-use asset is stated at cost comprising mainly the amount of the initial measurement of lease liability.
- The right-of-use asset is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. When the lease liability is remeasured, the amount of remeasurement is recognized as an adjustment to the right-of-use asset.
17) Investment property
A. Investment property of the Group is the property held either to earn long-term rental income or for capital appreciation or for both.
B. Part of the property may be held by the Group for self-use purpose and the remaining are used to generate rental income or capital appreciation. If the property held by the Group can be sold individually, then the accounting treatment should be made respectively. If each part of the property cannot be sold individually and the self-use proportion is not material, then the property is deemed as investment property in its entirety.
C. When the future economic benefit related to the investment property is highly likely to flow into the Group and the costs can be reliably measured, the investment property shall be recognized as assets. When the future economic benefit generated from subsequent costs is highly likely to flow into the entity and the costs can be reliably measured, the subsequent expenses of the assets shall be capitalized. All maintenance cost are recognized in profit or loss as incurred.
D. Investment property is subsequently measured using the cost model. Depreciated cost

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is used to calculate amortization expense after initial measurement. The depreciation method, remaining useful life and residual value should apply the same rules as applicable for property and equipment.

18) Intangible assets
A. The cost of computer software is amortized using the straight-line method over the useful lives based on acquisition cost, with an amortization period of 4 years.
B. Membership in a foreign futures exchange is stated at acquisition cost and has an indefinite useful life as it was assessed to generate continuous net cash inflow in the foreseeable future. It is not amortized, but is tested annually for impairment.
C. In accordance with IFRS 3 ‘Business combinations’ as endorsed by FSC, goodwill arises when the acquisition cost exceeds the fair value of identifiable assets and liabilities of the consolidated subsidiary on the consolidation date. The goodwill arising from the consolidated subsidiary is included in the intangible asset. Goodwill is tested annually for impairment and any impairment loss will be recognized when impairment occurs. Impairment losses on goodwill are not reversed.
19) Impairment of non-financial assets
A. The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. Except for goodwill, when the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortized historical cost would have been if the impairment had not been recognized.
B. The recoverable amounts of goodwill, intangible assets with an indefinite useful life and intangible assets that have not yet been available for use are evaluated periodically. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. Impairment loss of goodwill previously recognized in profit or loss shall not be reversed in the following years.
C. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units, or groups of cash-generating units, that is expected to benefit from the synergies of the business combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level.

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20) Financial liabilities at fair value through profit or loss

A. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of repurchasing in the short-term. Derivatives are also categorized as financial liabilities held for trading unless they are designated as hedges.
B. At initial recognition, the Group measures the financial liabilities at fair value. All related transaction costs are recognized in profit or loss. The Group subsequently measures these financial liabilities at fair value with any gain or loss recognized in profit or loss.
21) Contingent liabilities

Contingent liability is a possible obligation that arises from past event, whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group. Or it could be a present obligation as a result of past event but the payment is not probable or the amount cannot be measured reliably. The Group did not recognize any contingent liabilities but made appropriate disclosure in compliance with relevant regulations.

22) Employee benefits
A. Short-term employee benefits

B. Termination benefits

Termination benefits are employee benefits provided in exchange for the termination of employment as a result from either the Group’s decision to terminate an employee’s employment before the normal retirement date, or an employee’s decision to accept an offer of redundancy benefits in exchange for the termination of employee. The Group recognized expense as it can no longer withdraw an offer of termination benefit or it recognizes relating restructuring costs, whichever is earlier. Benefits that are expected to be due more than 12 months after balance sheet date shall be discounted to their present value.

C. Pensions
(A) Defined contribution plans

Effective July 1, 2005, the Group established the defined contribution plan for employees of R.O.C. nationality. The employees have the option to participate in the New Plan. Under the New Plan, the Company contributes monthly an amount equivalent to 6% of employees’ salaries to the employees’ personal pension accounts with the “Bureau of Labor Insurance”. Benefits accrued under the New Plan are portable upon termination of employment. Net defined benefit asset can only be recognized when there is a cash refund or elimination in the future accrued pension liabilities.

(B) Defined benefit plans

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a. In a defined benefit plan, the pension paid is determined based on the amount that an employee shall receive upon retirement, which could vary with age, work seniority and salary compensations. The Group recognizes the accrued pension obligations in the consolidated balance sheet based on the net amount of actuarial present value of defined benefit obligation less the fair value of fund, which is adjusted with the net of past service cost recognized as liabilities. Defined benefit obligation is assessed annually using projected unit credit method by the actuary. The present value of the defined benefit obligation is determined using the market yield of government bonds of a currency and term consistent with the currency and term of the employment benefit obligations.
b. Remeasurement arising on defined benefit plans are recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.
D. Employees’ remuneration and directors’ remuneration

23) Revenues and expenses

The Group’s revenues and expenses are recognized as incurred, which mainly include:

A. Gains (losses) on sale of securities, securities brokerage fees, and commissions on brokerage and trading are recognized on the transaction date.
B. Underwriting fees and related service charges: application fees are recognized upon collection; underwriting fees and service charges are recognized when the contract is completed.
C. Gains (losses) on futures contracts: The margin of futures transaction is recognized as cost. Costs and expenses are recognized as incurred.
D. Operating expenses: operating expenses refer to required expenses invested in the Group’s operations, which primarily include employee benefit expense, depreciation and amortization, and other business and administrative expenses.

24) Income tax

A. Current income tax

Income tax payable (refundable) is calculated on the basis of the tax laws enacted in the countries where a company operates and generates taxable income. Except for the transactions or other matters directly recognized in other comprehensive income or equity, in which cases the related income taxes in the period are recognized in other comprehensive income or directly derecognized from equity, all the others should be recognized as income or expense for the period.

B. Deferred income tax

Deferred income tax assets and liabilities are measured based on the tax rate of the

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anticipated period that the future assets realization or the liabilities settlement requires, which is based on the effective or existing tax rate at the consolidated balance sheet date. The carrying amounts and temporary differences of assets and liabilities included in the consolidated balance sheet are calculated using the balance sheet method and recognized as deferred income tax. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit (loss). Deferred income tax assets are recognized only to the extent that it is probable that taxable profit will be available against which the deductible temporary differences can be utilized. If the future taxable income is probable to provide unused loss carryforwards or deferred income tax credit which can be realized in the future, the proportion of realization is deemed as deferred income tax asset.

C. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Group operates and generates taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions for income tax liabilities where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings.
D. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realize the asset and settle the liability simultaneously.

25) Share capital

A. Incremental costs directly attributable to the issuance of new shares are shown as a deduction, net of tax, from equity. Dividends from common stocks are recognized as equity in the financial period in which they are approved by the Company’s shareholders. If the date of dividends declared is later than the consolidated balance sheet date, common stocks are disclosed in the subsequent events.
B. Where the Company repurchases the Company’s equity share capital that has been issued, the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company’s equity holders. Where such shares are subsequently reissued, the difference between their book value

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and any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders.

26) Earnings per share

A. Earnings per share is calculated by dividing net income by the weighted average number of shares outstanding during the year after taking into consideration the retroactive effect of stock dividends and capital reserve capitalized.
B. When the Group calculates earnings per share, basic earnings per share and diluted earnings per share for all potential ordinary shares shall all be disclosed in accordance with IAS 33 “Earnings per share”.
27) Operating segments

The Group’s operating segments are reported in a manner consistent with the internal reports provided to the Chief Operating Decision-Maker. The Group’s performance of segment profit (loss) is assessed based on the profit (loss) before tax, but not segment income, assets and liabilities. The Chief Operating Decision-Maker is responsible for allocating resources and assessing performance of the operating segments.

5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF

ASSUMPTION UNCERTAINTY

1) As the consolidated financial statements of the Group may be affected by the adoption of accounting policy, accounting estimate and assumption, the Group’s management shall properly exercise its professional judgement, estimates, and assumptions on the information of the key risks that is obtained from other resources and could affect the carrying amounts of financial assets and liabilities in the next fiscal year while adopting critical accounting policies as stated in Note 4. Estimates and assumptions of the Group are the best estimates made in compliance with IFRSs as endorsed by the FSC. Estimates and assumptions are made based on past experience and other factors (including the influence of COVID 19) deemed relevant; however, the actual results may differ from the estimates. The Group evaluates the estimates and assumptions on an ongoing basis and recognizes the adjustment of the estimates only in the period which is affected by the adjustment. If the adjustment simultaneously affects both the current and future periods, it should be recognized in both periods.
2) Relevant information on key assumptions to be made in the future, key sources of assumption uncertainty made at balance sheet date, and assumptions and estimates that may cause key risks that could affect the carrying amounts of financial assets and liabilities are as follows:
A. Fair value of financial instruments
- Financial instruments with no active market or quoted price use valuation technique to determine the fair value. Under such condition, fair value is assessed through the

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observable information or models of similar financial instruments. If there is no observable input available in a market, the fair value of financial instrument is assessed through appropriate assumptions. When valuation models are adopted to determine the fair value, all the models should be calibrated to ensure that the output can actually reflect actual information and market price. Models should try to take only observable information as much as possible.

B. Expected credit losses

For financial assets, the measurement of expected credit losses uses complex models and multiple assumptions. These models and assumptions take into account future macro-economic conditions and credit behaviors of borrowers (e.g. probability of customer default and loss). Please refer to Note 12(2) for detailed information on parameters, assumptions, and estimation methods used in measuring expected credit losses and disclosure of the sensitivity of credit loss to the aforementioned factors. The measurement of expected credit losses according to applicable accounting rules involves significant judgement in several areas, for example:

(A)The criteria used to judge whether there is significant increase in credit risk.
(B)The selection of appropriate models and assumptions for measuring expected credit losses.

For judgements and estimations of the above expected credit losses, please refer to Note 12(2).

C. Impairment assessment on investment accounted for under the equity method When there are impairment indicators that show the investments accounted for under equity method are impaired and the carrying amount can no longer be recovered, the Group will assess the impairment of the investment. The Group assesses its share of the recoverable amount which is based on the discounted value of expected cash flow, and assess the reasonableness of relevant assumptions, including revenue growth rate, operating profit margin, net profit margin, financial forecast, and discount rate.
D. Impairment assessment of goodwill
The periodic impairment assessment of goodwill includes allocation of assets, liabilities, and goodwill to brokerage segment, and determines the recoverable amount based on brokerage segment’s present value of expected future cash flow. The periodic assessment also analyzes reasonableness of relevant assumptions, including expected future trading volumes, market share, segment’s operating profit margin, and discount rates.

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6. DETAILS OF SIGNIFICANT ACCOUNTS

1) Cash and cash equivalents

December 31, 2021 Petty cash 168 $ Checking deposits 1,032,994 Current deposits: Deposits denominated in NTD 872,588 Deposits denominated in foreign currencies 1,452,113 Time deposits 2,399,149 Total 5,757,012 $	December 31,2020 168 $ 639,368 505,005 1,256,458 2,723,863 5,124,862 $

As of December 31, 2021 and 2020, the annual interest rates of time deposits, including foreign time deposits were 0.05%~2.70%, and 0.02% ~ 2.95%, respectively.

2) Financial assets at fair value through profit or loss

Current items: Financial assets mandatorily measured at fair value through profit or loss: Open-ended funds, money market instruments and securities investment by brokers Open-ended mutual funds beneficiary certificates Listed (TSE and OTC) stocks Exchange-traded funds Subtotal Adjustment of open-ended funds ,money market instruments and securities investment by brokers Total Trading securities-dealer Listed (TSE and OTC) stocks Government bonds Corporate bonds Convertible corporate bonds Emerging stocks Overseas stocks Exchange-traded funds Unlisted stocks Subtotal Adjustment of trading securities - dealer Total	December 31,2021 92,360 $ - 15,914 108,274 14,250 122,524 6,599,789 1,494,196 2,648,112 365,393 222,266 9,145,908 966,526 77,907 21,520,097 310,603 21,830,700	December 31,2020
		170,000 $ 5,799 35,148
		210,947 34,433
		245,380
		5,610,556 2,699,935 3,317,423 417,025 125,046 17,722,487 2,099,505 35,964
		32,027,941 1,114,737
		33,142,678

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Trading securities-underwriter Listed (TSE and OTC) stocks Convertible corporate bonds Subtotal Adjustment of trading securities - underwriter Total Trading securities-hedging Listed (TSE and OTC) stocks Convertible corporate bonds Warrants Overseas stocks Exchange traded funds Subtotal Adjustment of trading securities - hedging Total Options bought - futures Futures guarantee deposits receivable Derivative financial instrument assets - OTC Total Non-current items: Financial assets mandatorily measured at fair value through profit or loss: Trading securities - dealer - government bonds Unlisted stocks other Subtotal Adjustment of trading securities Total	December 31,2021 184,916 $ 493,640 678,556 121,471 800,027 5,454,491 32,692 16,108 196,726 2,992 5,703,009 304,525 6,007,534 26,510 4,780,970 14,724 33,582,989 $ 49,973 $ 2,609 15,000 67,582 9,142 76,724 $	December 31,2020
		469,460 $ 170,407
		639,867 49,913
		689,780
		3,535,818 20,561 52,681 - 12,084
		3,621,144 117,091
		3,738,235
		37,316
		3,748,960
		9,373
		41,611,722 $
		49,947 $ 2,609 -
		52,556 14,928
		67,484 $

a. For the years ended December 31, 2021 and 2020, net realized and unrealized gains on financial assets and liabilities at fair value through profit or loss amounted to $3,960,906 and $4,532,010, respectively.
b. Details of the Group’s financial assets at fair value through profit or loss pledged to others as collateral are provided in Note 8.
c. Information relating to credit risk is provided in Note 12(2).

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3) Financial assets at fair value through other comprehensive income

Current items: Equity instruments Trading securities-dealer Listed (TSE and OTC) stocks Adjustment of trading securities - dealer Total Non-current items: Equity instruments Unlisted stocks Adjustment of trading securities Total	December 31,2021 189,812 $ 220,393 410,205 $ 37,565 $ 1,100,191 1,137,756 $	December 31,2020
		189,812 $ 163,698
		353,510 $
		37,565 $ 670,051
		707,616 $

a. The Group has elected to classify unlisted stocks that are considered to be strategic investments or receive steady dividend as financial assets at fair value through other comprehensive income. The fair value of such investments amounts to $1,547,961 and $1,061,126 as at December 31, 2021 and 2020, respectively.
b. For the year ended December 31, 2020, the Group sold its stock investments listed on TSE and OTC with fair value of $1,525,695, and an accumulated gain on disposal of $177,031, in order to adjust the investment position. There were no transactions for the year ended December 31, 2021.

b.	$1,061,126 as at December 31, 2021 and 2020, respectively. For the year ended December 31, 2020, the Group sold its stock investments listed on TSE and OTC with fair value of $1,525,695, and an accumulated gain on disposal of $177,031, in order to adjust the investment position. There were no transactions for the year ended December 31, 2021.	$1,061,126 as at December 31, 2021 and 2020, respectively. For the year ended December 31, 2020, the Group sold its stock investments listed on TSE and OTC with fair value of $1,525,695, and an accumulated gain on disposal of $177,031, in order to adjust the investment position. There were no transactions for the year ended December 31, 2021.	$1,061,126 as at December 31, 2021 and 2020, respectively. For the year ended December 31, 2020, the Group sold its stock investments listed on TSE and OTC with fair value of $1,525,695, and an accumulated gain on disposal of $177,031, in order to adjust the investment position. There were no transactions for the year ended December 31, 2021.	$1,061,126 as at December 31, 2021 and 2020, respectively. For the year ended December 31, 2020, the Group sold its stock investments listed on TSE and OTC with fair value of $1,525,695, and an accumulated gain on disposal of $177,031, in order to adjust the investment position. There were no transactions for the year ended December 31, 2021.
c.	Amounts recognized in profit or loss and other comprehensive income in relation to the financial assets at fair value through other comprehensive income are listed below: Equity instruments at fair value through other comprehensive income Year ended December 31,2021 Year ended December 31,2020 Fair value change recognised in other comprehensive income - parent company 475,001 $ 453,860 $ Fair value change recognised in other comprehensive income - non-controlling interest 11,835 2,888 Total 486,836 $ 456,748 $ Cumulative gains reclassified to retained earnings due to derecognition - $ 177,031) ($ Dividend income recognised in profit or loss Held at end of period 31,915 $ 25,486 $ Derecognised during the period - 66,894 31,915 $ 92,380 $
	Fair value change recognised in other comprehensive income - parent company Fair value change recognised in other comprehensive income - non-controlling interest Total Cumulative gains reclassified to retained earnings due to derecognition Dividend income recognised in profit or loss Held at end of period Derecognised during the period		475,001 $ 11,835 486,836 $ - $ 31,915 $ - 31,915 $	453,860 $ 2,888 456,748 $ 177,031) ($ 25,486 $ 66,894 92,380 $

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Debt instruments at fair value through		Year ended		Year ended
other comprehensive income	December 31,2021		December 31,2020
Fair value change recognised in other comprehensive income	$	-	($	100,330)
Cumulative other comprehensive income
reclassified to profit or loss
Due to derecognition	$	-	$	100,358
Interest income recognised in profit or loss	$	-	$	28,276

d. Details of the Group’s financial assets at fair value through other comprehensive income pledged to others as collateral are provided in Note 8.
e. Information relating to credit risk is provided in Note 12(2).
4) Bonds purchased under resale agreements

income pledged to others as collateral are provided in Note 8. e. Information relating to credit risk is provided in Note 12(2). Bonds purchased under resale agreements
December 31, 2021 Foreign bonds 27,401 $	December31,2020
	- $

The above bonds purchased under resale agreements as of December 31, 2021 and 2020 were due within one year and were contracted to be repurchased at the agreed-upon price plus interest charge on the specific date after the transaction. The total repurchase amounts were $27,424 and $0, respectively, and the annual interest rates in every currency were shown as follows:

Currency USD	December 31,2021 0.3375%	December 31,2020 -

5) Margin loans receivable

Margin loans receivable were secured by the securities purchased by customers under margin loans. The annual interest rate was 6.4%.

6) Customer margin account

Customer margin account
Bank deposit Futures clearing house Other futures commission merchant Securities Total	December 31,2021 15,444,698 $ 3,837,326 2,053,066 442 21,335,532 $	December 31,2020
		15,149,252 $ 2,372,222 3,584,333 363
		21,106,170 $

The difference between the customer margin deposits accounts and futures traders’ equity as of December 31, 2021 and 2020 were outlined below:

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	December 31,2021	December 31,2021	December 31,2021	December 31,2020	December 31,2020
Customer margin deposits accounts	$		21,335,532	$	21,106,170
Futures trading margins receivable			45		-
Add: Early customer margin deposits			15,106		2,202
Less: Service fee income pending for transfer	(		11,180)	(	12,815)
Futures exchange tax pending for transfer	(		835)	(	967)
Net interest income pending for transfer	(		1,580)	(	1,549)
Temporary receipts	(		8,914)	(	5,907)
Futures traders' equity	$		21,328,174	$	21,087,134
7) Accounts receivable
	December 31,2021			December 31,2020
Accounts receivable - related parties	$		1,147	$	875
Accounts receivable - non related parties
Settlement price receivable-brokers	$		14,272,345	$	16,022,037
Settlement price receivable-dealer			392,802		132,304
Accounts receivable-foreign bonds			137,269		4,454
Spot exchange receivable, foreign currencies			-		55,001
Interest receivable			336,711		244,723
Settlement price			1,350,480		2,287,777
Others			238,828		106,725
Subtotal			16,728,435		18,853,021
Less: Allowance for uncollectable accounts	(		742)	(	625)
Total		$	16,727,693	$	18,852,396

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

follows:
Accounts receivable Accounts receivable - related parties Accounts receivable - non related parties Accounts receivable Accounts receivable - related parties Accounts receivable - non related parties			December 31,2021			Total
	Upto 30 days	31 to90 days	91 to 180 days	181 days to 12 months	More than 12 months
	1,147 $ 16,407,215 16,408,362 $	- $ 48,077 48,077 $	- $ - $ 93,910 116,288 93,910 $ 116,288 $ December 31,2020		- $ 62,945 62,945 $	1,147 $ 16,728,435 16,729,582 $ Total
	Upto 30 days	31 to90 days	91 to 180 days	181 days to 12 months	More than 12 months
	875 $ 18,627,147 18,628,022 $	- $ 44,729 44,729 $	- $ 86,828 86,828 $	- $ 62,638 62,638 $	- $ 31,679 31,679 $	875 $ 18,853,021 18,853,896 $

Note ： The above ageing analysis was based on invoice date.

B. Information relating to credit risk is provided in Note 12(2).

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8) Other receivables

Other receivables
		December 31,2021			December 31,2020
Interest receivable		$	6,960		$	6,121
Others			27,182			18,554
Subtotal			34,142			24,675
Less: Allowance for uncollectible accounts	(		853)	(		725)
Total		$	33,289		$	23,950
Information relating to credit risk is provided	in Note 12(2).
Other current assets
		December 31,2021			December 31,2020
Pending settlements		$	1,208,513		$	1,489,800
Pledged time deposits			521,021			525,249
Deposits-in for foreign currency securities			1,884,425			647,622
Underwriting share proceeds collected on
behalf of customers			5,243,851			651,290
Others			104,236			30,666
Total		$	8,962,046		$	3,344,627

9) Other current assets

10) Transfer of financial assets

A. During the Group’s activities, the transferred financial assets that do not meet derecognition conditions are mainly debt instruments with purchase agreements or debt instruments lent out in accordance with securities borrowing and lending agreement. The cash flow of the contract has been transferred and related liabilities of transferred financial assets that will be repurchased at a fixed price in the future have been reflected. The Group may not use, sell or pledge the transferred financial assets during the valid period of the transaction. The financial assets were not derecognized as the Group is still exposed to interest rate risk and credit risk.
B. Financial assets that do not meet the derecognition conditions and related financial liabilities are analysed below:

Financial assets category Carrying amount of transferredfinancialassets Financial assets measured at fair value through profit or loss Repurchase agreement 10,016,623 $ December 31,2020	Carrying amount of transferredfinancialassets	Carrying amount of related financial liabilities
		9,643,040 $ Carrying amount of related financial liabilities
Financial assets category Financial assets measured at fair value through profit or loss Repurchase agreement	Carrying amount of transferredfinancialassets
	20,375,875 $	19,096,165 $

304

11) Offsetting financial assets and financial liabilities
A. The Group has transactions that are or are similar to net settled master netting arrangements but do not meet the offsetting criteria, i.e. derivative financial instruments, resale and repurchase agreements. If one party breaches the contract, the counterparty can choose to use net settlement for the above transactions.
B. The offsetting of financial assets and financial liabilities are set as follows:

(Blank below)

305

(1) Financial assets

nancial assets
		December 31,2021
Derivative financial instruments Bonds purchased under resale agreements Total Description	Gross amounts of recognised financial assets	Gross amounts of recognised financial liabilities set off in the balance sheet	Net amounts of financial assets presented in the balance sheet	Financial instruments Cash collateral received 2,467 $ - $ 27,334 - 29,801 $ - $ Not set off in the balance sheet	Net amount
				Financial instruments
	14,257 $ 27,401 41,658 $	- $ 14,257 $ - 27,401 - $ 41,658 $ December 31,2020		2,467 $ 27,334 29,801 $	11,790 $ 67
					11,857 $

Derivative financial instruments Description	Gross amounts of recognised financial assets	Gross amounts of recognised financial liabilities set off in the balance sheet	Net amounts of financial assets presented in the balance sheet	Financial instruments Cash collateral received 9,303 $ - $ Not set off in the balance sheet	Net amount
				Financial instruments
	9,303 $	- $	9,303 $	9,303 $	- $

306

(2) Financial liabilities

nancial liabilities
		December 31,2021
Derivative financial instruments Bonds sold and repurchase agreements Total Description	Gross amounts of recognised financial liabilities	- $ 2,467 $ - 6,598,995 - $ 6,601,462 $ Gross amounts of recognised financial assets set off in the balance sheet Net amounts of financial liabilities presented in the balance sheet December 31, 2020
					Financial instruments
	2,467 $ 6,598,995 6,601,462 $				2,647 $ 6,598,995 6,601,642 $
Derivative financial instruments Bonds sold and repurchase agreements Total Description	Gross amounts of recognised financial liabilities	Gross amounts of recognised financial assets set off in the balance sheet		Net amounts of financial liabilities presented in the balance sheet	Financial instruments Cash collateral received 9,303 $ - $ 14,051,616 - 14,060,919 $ - $ Not set off in the balance sheet
					Financial instruments
	26,252 $ 14,051,616 14,077,868 $		- $ - - $	26,252 $ 14,051,616 14,077,868 $	9,303 $ 14,051,616 14,060,919 $

307

12) Investments accounted for under the equity method

	December31,2021	December31,2021	December31,2020	December31,2020
Uni-President Asset Management Corp.	$	760,787	$	602,865
Jin Yuan President Securities Co.,Ltd.		2,363,197		2,531,901
	$	3,123,984	$	3,134,766

A. The Group’s share of its associates’ profits or losses recognized in long-term equity investment accounted for under the equity method for the years ended December 31, 2021 and 2020 were $78,359 and $68,825, respectively.
B. The Group holds 42.49% of the equity of Uni-President Asset Management Corp., making it the single largest shareholder of the company, while the other equity is mainly held by the other 15 shareholders. Half of the voting rights of the shareholders attending the shareholders, meeting exceeds the voting rights of the Group, and the Group does not take an active role in the management of the company. This shows that the Group has no actual ability to direct relevant activities. The Group has no control over Uni-President Asset Management Corp., but has significant influence over it.
C. The financial information of the Group’s principal associates is summarized as follows:
(a)The basic information of the associates that are material to the Group is as follows:

Company name	Princial place of businesss Shareholding ratio	Nature of relationship	Methods of measurement
Uni-President Asset Management Corp. Jin Yuan President Securities Co.,Ltd. (Note)	December 31, 2021 December 31, 2020 Taipei city 42.49% 42.49% Xiamen 49% 49%	Associate Associate	Equity method Equity method

Note:The Company participated in the establishment of Jin Yuan President Securities Co., Ltd. since May 2020.

(b)The summarized financial information of the associates that are material to the Group is as follows:

Balance sheet

Balance sheet
Current assets Non-current assets Current liabilities Non-current liabilities Total net assets Share in associate net assets Goodwill and others Carrying amount of the associate		Uni-President Asset	December 31,2020 Management Corp.
		December 31,2021
	1,105,200 $ 761,113 433,586) ( 64,962) ( 1,367,765 $ 581,265 $ 179,522 760,787 $		656,152 $ 687,024 292,750) ( 54,266) ( 996,160 $ 423,343 $ 179,522 602,865 $

308

Balance sheet

Jin Yuan President Securities Co.,Ltd.

		December 31, 2021		December 31, 2020
Current assets	$	8,438,646	$	5,083,846
Non-current assets		317,940		174,020
Current liabilities	(	3,852,030)	(	85,687)
Non-current liabilities	(	81,706)	(	5,034)
Total net assets	$	4,822,850	$	5,167,145
Share in associate net assets	$	2,363,197	$	2,531,901
Carrying amount of the assciate	$	2,363,197	$	2,531,901

Statement of comprehensive income

Statement of comprehensive income
Revenue Profit (loss) for the period from continuing operations Other comprehensive income - net of tax Total comprehensive income Dividends received from associates Revenue Profit (loss) for the period from continuing operations Total comprehensive income (loss)	Year ended December 31,2021 Year ended December 31,2020 1,411,480 $ 941,595 $ 536,134 $ 258,096 $ 68,517 20,871 604,651 $ 278,967 $ 99,039 $ 94,542 $ Uni-President Asset Management Corp. Jin Yuan President Securities Co.,Ltd.

	Year ended December 31,2021		Eight months ended December 31,2020
	291,581 $ 305,071 $ 305,071 $	74,454 $ 83,388) ($ 83,388) ($

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13) Property and equipment

) Property and equipment
January1				2021
	Land	Buildings		Equipment		Leasehold improvements		Total
Cost Accumulated depreciation and impairment Total January 1 Additions Disposal Reclassifications Depreciation December 31 December 31	1,680,129 $ - 1,680,129 $ 1,680,129 $ - - - - 1,680,129 $ Land	1,098,380 $ 455,178) ( 643,202 $ 643,202 $ 924 - 12,443 34,528) ( 622,041 $ Buildings		277,347 $ 158,858) ( 118,489 $ 118,489 $ 50,927 57) ( 19,180 52,228) ( 136,311 $ Equipment		39,669 $ 27,777) ( 11,892 $ 11,892 $ 555 - 750 4,550) ( 8,647 $ Leasehold improvements		3,095,525 $ 641,813) ( 2,453,712 $ 2,453,712 $ 52,406 57) ( 32,373 91,306) ( 2,447,128 $ Total
Cost Accumulated depreciation and impairment Total January1	1,680,129 $ - 1,680,129 $	1,110,116 $ 488,075) ( 622,041 $		313,717 $ 177,406) ( 136,311 $ 2020		35,121 $ 26,474) ( 8,647 $		3,139,083 $ 691,955) ( 2,447,128 $ Total
	Land		Buildings		Equipment		Leasehold improvements
Cost Accumulated depreciation and impairment Total January 1 Additions Disposal Reclassifications Depreciation December 31 December 31	1,680,129 $ - 1,680,129 $ 1,680,129 $ - - - - 1,680,129 $	1,060,323 $ 428,805) ( 631,518 $ 631,518 $ 4,262 - 37,170 29,748) ( 643,202 $		259,114 $ 143,409) ( 115,705 $ 115,705 $ 30,779 244) ( 19,213 46,964) ( 118,489 $ 2020		48,000 $ 31,388) ( 16,612 $ 16,612 $ 1,613 87) ( - 6,246) ( 11,892 $		3,047,566 $ 603,602) ( 2,443,964 $ 2,443,964 $ 36,654 331) ( 56,383 82,958) ( 2,453,712 $ Total
	Land		Buildings		Equipment		Leasehold improvements
Cost Accumulated depreciation and impairment Total	1,680,129 $ - 1,680,129 $	1,098,380 $ 455,178) ( 643,202 $		277,347 $ 158,858) ( 118,489 $		39,669 $ 27,777) ( 11,892 $		3,095,525 $ 641,813) ( 2,453,712 $

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A. No interest was capitalized for property and equipment for the years ended December 31, 2021 and 2020.
B. The information on property and equipment pledged or restricted as of December 31, 2021 and 2020 is described in Note 8.
－
14) Leasing arrangements lessee
A. The Group leases various assets including buildings, machinery and equipment, business vehicles and multifunction printers. Rental contracts are typically made for periods of 1 to 10 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 used as security for borrowing purposes.
B. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Buildings Transportation equipment (Business vehicles) Office equipment (Photocopiers) Total Buildings Transportation equipment (Business vehicles) Office equipment (Photocopiers) Total		December 31, 2021		December 31,2020 Carrying Amount
		Carrying Amount
		176,182 $ 19,011 9,428 204,621 $ Year ended December 31,2021		174,624 $ 17,350 11,605 203,579 $ Year ended December 31,2020 Depreciation charge
		Depreciation charge
		86,568 $ 6,725 2,661 95,954 $		88,224 $ 6,440 1,756 96,420 $

C. For the years ended December 31, 2021 and 2020, the additions to right-of-use assets amounted to $98,263 and $84,449, respectively.
D. The information on income and expense accounts relating to lease contracts is as follows:

Items affecting profit or loss	Year ended December 31,2021	Year ended December 31,2020
Interest expense on lease liabilities Expense on short-term lease contracts Expense on variable lease payment	1,618 $ 1,682 3,485	2,293 $ 3,567 224

E. For the years ended December 31, 2021 and 2020, the Group’s total cash outflow for leases amounted to $96,804 and $98,866, respectively.
F. The Group has applied the practical expedient to “Covid-19-related rent concessions”, and recognized the other gains or losses from changes in lease payments arising from the rent concessions amounting to $104 and $116 by decreasing rent expense for the years ended December 31, 2021 and 2020.

311

15) Leasing arrangements – lessor

A. The Group leases various assets including office and parking space. Rental contracts are typically made for periods of 1 and 5 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.
B. For the years ended December 31, 2021 and 2020, the Group recognized rent income in the amount of $18,113 and $18,836, respectively, based on the operating lease agreement, which does not include variable lease payments.
C. The maturity analysis of the lease payments under the operating leases is as follows:

December 31, 2021 2021 - $ 2022 17,752 2023 22,424 2024 4,312 Total 44,488 $	December 31, 2020
	17,584 $ 17,284 17,284 4,195 56,347 $

16) Investment property

January1 Cost Accumulated depreciation and impairment Total January 1 Depreciation December 31 December 31 Cost Accumulated depreciation and impairment Total January1 Cost Accumulated depreciation and impairment Total January 1 Depreciation December 31 Cost Accumulated depreciation and impairment Total		2021

312

A. For the years ended December 31, 2021 and 2020, rental income from the lease of the investment property were $17,115, and $16,570, respectively, and direct operating expenses arising from the investment property were $3,579, and $3,864, respectively.

B. Details of fair value of investment property are provided in Note 12(5).

17) Intangible assets

Intangible assets
January1			2021
	Computer software		Goodwill
Cost Accumulated depreciation and impairment Total January 1 Additions Reclassifications Depreciation December 31 December 31	196,733 $ 122,720) ( 74,013 $ 74,013 $ 46,025 35,375 37,679) ( 117,734 $ Computer software		42,004 $ - 42,004 $ 42,004 $ - - - 42,004 $ Goodwill
Cost Accumulated depreciation and impairment Total January1	273,340 $ 155,606) ( 117,734 $
		Computer software	Goodwill	Customer relationships and others Total 89,929 $ 285,320 $ 54,163) ( 156,160) ( 35,766 $ 129,160 $ 35,766 $ 129,160 $ - 17,887 - 31) ( - 32,640 18) ( 27,891) ( 35,748 $ 151,765 $
Cost Accumulated depreciation and impairment Total January 1 Additions Disposals Reclassifications Depreciation December 31	153,387 $ 101,997) ( 51,390 $ 51,390 $ 17,887 31) ( 32,640 27,873) ( 74,013 $		42,004 $ - 42,004 $ 42,004 $ - - - - 42,004 $

313

December 31 Computer software Cost 196,733 $ Accumulated depreciation and impairment 122,720) ( Total 74,013 $	Goodwill Customer relationships and others Total 42,004 $ 89,929 $ 328,666 $ - 54,181) ( 176,901) ( 42,004 $ 35,748 $ 151,765 $ 2020

A. No interest was capitalized for intangible assets for the years ended December 31, 2021 and 2020.
B. Goodwill and customer relationships were acquired through acceptance of transfer of the securities brokerage business of Standard Chartered (Taiwan) Bank's retail banking business, and were all allocated to the Group’s brokerage segment.
C. The recoverable amount of goodwill was periodically determined based on its value in use. Calculations of value in use after-tax cash flow projections are based on financial budgets approved by the management covering a five-year period. Cash flows beyond the five-year period are extrapolated using the estimated growth rates stated below.

The recoverable amount calculated based on the value in use exceeded the carrying amount, thus the goodwill was not impaired. The key assumptions used for calculation of value in use are as follows:

Growth rate Discount rate	Brokerage Segment 2021 0.00% 12.03%	Brokerage Segment 2020 0.00% 9.79%

18) Other non-current assets

risks related to relevant operating segments. Other non-current assets
		December 31,2021			December 31,2020
Operation guaranteed deposits	$		655,000	$		655,000
Clearing and settlement fund			337,108			346,349
Refundable deposits			283,144			238,840
Deferred expenses			14,572			15,564
Prepaid pension expenses			1,042			17,625
Prepayment for equipment			94,823			22,610
Overdue receivables			12,517			39,388
Others			2,500			720
			1,400,706			1,336,096
Less: Allowance for uncollectible accounts	(		12,517)	(		39,388)
Total	$		1,388,189	$		1,296,708

314

19) Short-term loans

20)
21)

Commercial papers payable
Financial liabilities at fair value through profit or loss-current
December 31,2021
December 31,2020
Unsecured loans
590,000
$ 946,276
$
Interest rates
0.790%
0.590%~1.154%
December 31, 2021
December 31,2020
Face value
8,650,000
$ 7,300,000
$ Less: discount on commercial papers payable
1,442)
(
1,104)
(
Total
8,648,558
$ 7,298,896
$ Interest rates
0.320%~0.500%
0.200%~0.340%
December 31,2021
December 31,2020
Covering bonds
148,560
$ -
$ Valuation adjustment on covering bonds
270)
(
-
148,290
-
Liabilities on sale of borrowed securities
- hedged
408,629
243,446
Valuation adjustment on liabilities on sale of
borrowed securities - hedged
16,664
28,741
Liabilities on sale of borrowed securities
- non-hedged
4,294,538
688,401
Valuation adjustment on liabilities on sale of
borrowed securities - non-hedged
404,442
79,206
Subtotal
5,124,273
1,039,794
Issuance of call ( put ) warrants
12,925,747
10,937,977
Gain on price fluctuation
500,708)
(
912,291)
(
Market value (A)
12,425,039
10,025,686
Warrants redeemed
12,258,180)
(
9,807,568)
(
Loss on price fluctuation
729,365
461,682
Market value (B)
11,528,815)
(
9,345,886)
(
Warrants - net (A+B)
896,224
679,800
Options sold - TAIFEX
8,029
17,683
Outstanding Liability for Issuance of ETNs
1,678,161
683,685
Valuation adjustment on outstanding Liability for
Issuance of ETNs
106,307)
(
52,029
Subtotal
1,571,854
735,714
Derivative financial liabilities - OTC
423,932
151,428
Total
8,172,602
$ 2,624,419
$

315

Among the warrants issued by the Group, except for contract-based warrants which are Europeanstyle warrants, all other warrants are American-style warrants. Warrants are stated as liabilities for issuance of warrants at issuance price prior to expiration. Upon repurchase of warrants after issuance, the repurchased amounts are recognized as warrants repurchase and charged as a deduction to liabilities for issuance of warrants. The warrants have six to twelve months exercise period from the date of issuance. The issuer has the option to settle either by cash or stock delivery.

22) Bonds sold under repurchase agreements

Bonds sold under repurchase agreements
Government bonds Corporate bonds Bank debentures International bonds Foreign bonds Total	December 31, 2021 1,623,147 $ 500,119 300,000 620,779 6,598,995 9,643,040 $	December 31, 2020
		2,856,072 $ 951,350 200,000 1,037,127 14,051,616
		19,096,165 $

Currency December 31,2021 NTD 0.17%~0.32% Foreign currencies (Note) -0.70%~3.61% (Note)`：`Foreign currencies include AUD, EUR, USD, GDP, RMB and SGD.	December 31,2020
	0.17%~0.26% -0.40%~3.10%

23) Accounts payable

Accounts payable
Other payables Settlement accounts payable - brokered trading Settlement proceeds Settlement accounts payable - operating Accounts payable - foreign bonds Accounts payable - international bonds Spot exchange payable, foreign currencies Others Total Salary and bonus payable Employees’ and directors’ remuneration payable Others Total	December 31,2021 15,695,459 $ 785,772 1,404,454 121,943 - - 330,584 18,338,212 $ December 31,2021 1,706,135 $ 195,823 725,965 2,627,923 $	December 31,2020
		17,947,954 $ 471,589 519,434 14,454 27,575 54,719 142,759
		19,178,484 $
		December 31,2020
		1,329,809 $ 175,255 611,349
		2,116,413 $

24) Other payables

316

25) Other financial liabilities - current

Other financial liabilities-current
	December 31,2021		December 31,2020
Equity-linked notes (ELN) - Options	$	84,000	$	17,000
Principal guaranteed notes (PGN) - fixed income		4,899,139		5,991,310
Total	$	4,983,139	$	6,008,310

The Group deals in equity-linked products and combines fixed income instruments with call or put options. These products are categorized into ELN (Equity-Linked Notes) and PGN (Principal Guaranteed Notes). On trade date, the contracted amounts are collected in full from the counterparties. The payout amount on maturity will depend on the price fluctuation of the instruments linked to these contracts and be calculated as trading price less option strike price on maturity. All the linked products are financial instruments under the supervision of the SFB (Securities and Futures Bureau).

26) Other liabilities-non-current

Other liabilities-non-current
December 31, 2021 Guarantee deposits received 6,594 $ Net defined benefit obligation 62,691 Total 69,285 $		December 31,2020
		7,802 $ 6,612 14,414 $

27) Pension plan

A. Defined benefit plans

(A) The Group 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. 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. 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. The Group contributes monthly an amount which ranges between 2.0% and 7.2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the supervisory committee of workers' retirement reserve fund, and with Cathay United Bank, under the name of the management committee of employees’ retirement fund. Also, the Group would assess the balance in the aforementioned labor pension reserve account by the end of December 31, every year. If the account balance is insufficient to pay the pension calculated by the aforementioned method, to the employees expected to be qualified for retirement next year, the Group will make contributions to cover the deficit by next March.

(B) The amounts recognized in the balance sheet are as follows:

	December	31,2021	December	31,2020
Net present value of defined benefit liabilities	$	846,969	$	829,660
Fair value of plan assets	(	785,320)	(	840,673)
Net defined benefit (assets) liabilities	$	61,649	($	11,013)

317

(C) Movements in net defined benefit liabilities (assets) are as follows:

Year ended December 31,2021 Blance at January 1 Current service cost Interest expense (income) Remeasurements: Return on plan assets (excluding amounts included in interest income or expense) Change in demorgraphic assumptions Change in financial assumptions Experience adjustments Pension fund contribution Paid pension Blance at December 31 Year ended December 31,2020 Blance at January 1 Current service cost Interest expense (income) Remeasurements: Return on plan assets (excluding amounts included in interest income or expense) Change in financial assumptions Experience adjustments Pension fund contribution Paid pension ( ( Blance at December 31	Present value of defined benefit obiligations	Fair value of plan assets 840,673) ($ - 2,522) ( 843,195) ( 8,863) ( - - - 8,863) ( 57,046) ( 123,784 66,738 785,320) ($ Fair value of plan assets 844,616) ($ - 5,933) ( 850,549) ( 10,504) ( ( - - 10,504) ( 43,951) ( ( 64,331 20,380 ( 840,673) ($ (	Net defined benefit liabilities (assets)
	829,660 $ 3,994 2,489 836,143 - 725 14,083) ( 147,968 134,610 - 123,784) ( 123,784) ( 846,969 $ Present value of defined benefit obiligations		11,013) ( 3,994 33) ( 7,052) ( 8,863) ( 725 14,083) ( 147,968 125,747 57,046) ( - 57,046) ( 61,649 $ Net defined benefit liabilities (assets) 6,214 4,678 49 10,941 10,504) 28,169 4,332 21,997 43,951) - 43,951) 11,013) $
	850,830 $ 4,678 5,982 861,490 - 28,169 4,332 32,501 - 64,331) 64,331) 829,660 $

318

(D) The Bank of Taiwan was commissioned to manage the Fund of the Group’s defined benefit pension plan in accordance with the Fund’s annual investment and utilization plan and “Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund” (Article 6: The scope of utilization for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-the-counter, or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilization of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. If the earnings is less than aforementioned rates, government shall make payment for the deficit after being authorized by the Regulator.

The Group has no right to participate in managing and operating that fund and hence the Group is unable to disclose the classification of plan asset fair value in accordance with IAS 19 paragraph 142. The composition of fair value of plan assets as of December 31, 2021 and 2020 is given in the Annual Labor Retirement Fund Utilization Report published by the government. In addition, for retirement fund deposits with Cathay United Bank, under the name of the management committee of employees’ retirement fund, the fund invests in time deposit accounts under Cathay United Bank.

(E) The principal actuarial assumptions used were as follows:

Discount rate Future salary increases	Year ended December 31, 2021		Year ended December 31,2020
	0.50%~0.60% 2.00%~3.00%		0.30%
			2.00%~3.00%

Assumptions regarding future mortality rate are set based on the Taiwan Standard Ordinary Experience Mortality Table (2021 and 2011) for the years ended December 31, 2021 and 2020. Because the main actuarial assumption changed, the present value of defined benefit obligation is affected. The analysis was as follows:

December 31, 2021 Effect on present value of defined benefit obligation December 31,2020 Effect on present value of defined benefit obligation	Discount rate	Discount rate	Discount rate		Future salaryincreases	Future salaryincreases
	Increase 0.25%		Decrease 0.25%		Increase 0.25%	Decrease 0.25%
	16,776) ($ 17,560) ($		17,279 $ 18,115 $		14,821 $ 15,634 $	14,490) ($ 15,264) ($

(F) Pension fund contribution plans to pay $55,978 for the year ended December 31, 2022.

B. Defined contribution plans:

Effective from July 1, 2005, the Group established a defined contribution plan pursuant to the “Labor Pension Act”, which covers employees with R.O.C. nationality and those who chose or are required to apply the “Labor Pension Act”. The contributions are made monthly based on not less than 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The payment of pension benefits is based on the employees’ individual pension fund accounts and the cumulative profit in such accounts. The

319

employees can choose to receive such pension benefits monthly or in lump sum. The pension costs under defined contribution pension plans of the Group for the years ended December 31, 2021 and 2020 were $83,469 and $70,873, respectively.

C. President Securities (HK), President Walth Management (HK), and President Securities (Nominee) have defined benefit pension plans in accordance with local laws, and recognized the current pension expenses by contributing to the accrued pension assets. President Securities (HK) recognized pension expenses of $1,662 and $1,778, respectively, for the years ended December 31, 2021 and 2020.

28) Equity

A. Common stock
(A) As of December 31, 2021, the Company’s authorized capital was $15,000,000 with a par value of $10 (in dollars) per share. As of December 31, 2021 and 2020, the outstanding common stocks were 1,455,831 and 1,399,838 thousand shares, respectively.

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

January 1 Stock dividends December 31	(Expressed in thousands) Year ended December 31, 2021 Year ended December 31,2020 1,399,838 $ 1,372,390 $ 55,993 27,448 1,455,831 $ 1,399,838 $	(Expressed in thousands) Year ended December 31, 2021 Year ended December 31,2020 1,399,838 $ 1,372,390 $ 55,993 27,448 1,455,831 $ 1,399,838 $
	1,399,838 $ 55,993 1,455,831 $	1,372,390 $ 27,448 1,399,838 $

The Group was approved by the Board of Directors on March 23, 2021 and the shareholders' meeting resolved on July 20, 2021 to increase capital with an undistributed surplus of 559,935, and issue 55,993 thousand ordinary shares with a par value of $10 per share. The capital increase base date is at September 1, 2021, the total issued share capital after the capital increase was $14,558,313, divided into 1,455,831 thousand shares, each with a denomination of $10 per share.

B. Capital reserve

share. Capital reserve
December 31, 2021 December 31, 2020	Sharepremium	Treasury share transactions	Expired stock options	Difference between consideration and carrying amount of subsidiaries acquired ordisposed	Total
	24,663 $ 24,663 $	65,675 $ 65,675 $	483 $ 483 $	440 $ 440 $	91,261 $
					91,261 $

320

C. Legal reserve
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. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the balance of the reserve exceeds 25% of the Company’s paid-in capital.
D. Special reserve
In accordance with the “Rules Governing the Administration of Securities Firms”, 20% of the current year's earnings, after paying all taxes and offsetting prior years' operating losses, and plus the items other than the after-tax net profit for the period, that are included in the unappropriated earnings of the period, if any, shall be set aside as special reserve until the cumulative balance equals the total amount of paid-in capital. The special reserve shall be used exclusively to cover accumulated deficit or to increase capital and shall not be used for any other purpose. Such capitalization shall not be permitted unless the Company had already accumulated a special reserve of at least 25% of its paid-in capital stock and only quarter of such special reserve may be capitalized.
In accordance with the regulations, the Company shall set aside an equivalent amount of special reserve from accumulated unappropriated retained earnings of the current year based on the decreased amount of equity. If there is any subsequent reversal of the decrease in equity, the earnings may be distributed based on the reversal proportion.
In accordance with Jing-Guan-Zheng-Chuan Letter No. 10500278285 dated August 5, 2016, securities firms should set aside 0.5% to 1% of net income after tax as special reserve, upon the distribution of earnings from 2016 to 2018. From fiscal year 2017, special reserve as mentioned above may be reversed based on an amount equal to employees’ transformation training expenditure, transfer and arrangement expenditure arising from the development of Fintech. Further, according to Jing-Guan-Zheng-Chuan Letter No. 1080321644 dated July 10, 2019, securities firms are no longer required to set aside special reserve starting from 2019. And the special reserve, within the balance of special reserve set aside in the previous years, could be reversed at the same amount for the aforementioned expenditures.

29) Unappropriated earnings and dividends policy

A. Under the Company’s Articles of Incorporation, the current year’s earnings, if any, shall be used to pay all taxes and offset prior years’ operating losses first, and then set aside as legal reserve, accounted for as 10% of the remaining amount, and special reserve, accounted for as 20% of the remaining amount. Upon provision or reversal of special reserve in accordance with the law, any remaining amount together with unappropriated earnings at beginning of the period shall be distributed according to the following resolution adopted at the stockholders’ meeting: Distribution shall not be made if the balance of distributable earnings is less than 5% of paid-in capital.
B. In addition, the total amount of dividends declared every year shall be at least 70% of distributable earnings, of which stock dividends shall be at least 50% and cash dividends shall be lower than 50%.
C. The Company may determine a better proportion of cash and stock dividends distribution based on its actual operating conditions and capital utilization plan for the following year.
D. The earnings distribution for 2020 as resolved by the shareholders on July 20, 2021 the appropriation of 2019 earnings was resolved by the shareholders on June 19, 2020. Details are as follows:

321

Provision of legal reserve Provision of special reserve Reversal of special reserve (Note) Cash dividends Stock dividends Total	Amount Dividends per share (in dollars) Amount Dividends per share (in dollars) 376,735 $ 234,244 $ 721,503 473,707 7,620) ( 4,221) ( 2,099,757 1.50 $ 1,372,390 1.00 $ 559,935 0.40 274,478 0.20 3,750,310 $ 2,350,598 $ For the year ended December 31,2020 For the year ended December 31,2019	Amount Dividends per share (in dollars) Amount Dividends per share (in dollars) 376,735 $ 234,244 $ 721,503 473,707 7,620) ( 4,221) ( 2,099,757 1.50 $ 1,372,390 1.00 $ 559,935 0.40 274,478 0.20 3,750,310 $ 2,350,598 $ For the year ended December 31,2020 For the year ended December 31,2019
	376,735 $ 721,503 7,620) ( 2,099,757 559,935 3,750,310 $	1.00 $ 0.20

Note ： Special reserve was provided for employees’ transition for financial technology development according to Jing-Guan-Zheng-Chuan Letter No. 1080321644 and can be reversed for employees’ transition.

E. The earnings distribution for 2020 as resolved by the Board of Directors on March 23, 2021 is set forth below:

Provision of legal reserve Provision of special reserve Reversal of special reserve (Note) Cash dividends Total	Amount Dividends per share (in dollars) 390,101 $ 780,203 3,413) ( 2,751,521 1.89 $ 3,918,412 $ Year ended December 31,2021

30) Brokerage handling fee revenue

reversed for employees’ transition. Brokerage handling fee revenue
Revenues from brokered trading - TWSE Revenues from brokered trading - OTC Revenues from brokered trading - Futures Others Total		Year ended December 31,2021 3,161,522 $ 880,732 824,097 160,878 5,027,229 $	Year ended December 31, 2020
			1,787,310 $ 617,121 790,960 135,639 3,331,030 $

322

31) Revenues from underwriting business

Revenues from underwriting business
		Year ended		Year ended
	December 31,2021		December 31,2020
Revenues from underwriting securities on a
firm commitment basis	$	61,104	$	25,222
Others		42,931		51,284
Total	$	104,035	$	76,506

32) Net gain (loss) on sale of trading securities

Interest revenue Dealers: -TAIEX -OTC -Overseas trading -Dealings of non-listed securities Subtotal Underwriters: -TAIEX -OTC Subtotal Hedging: -TAIEX -OTC -Overseas trading Subtotal Total Interest income from margin loans Interest income from bonds Others Total	Year ended December 31,2021 4,193,183 $ 486,511 201,478) ( 1,500 4,479,716 20,564 135,272 155,836 3,998,363 68,918 28,210 4,095,491 8,731,043 $ Year ended December 31,2021 890,511 $ 274,506 33,189 1,198,206 $	Year ended December 31,2020
		1,750,883 $ 32,375 1,232,261 - 3,015,519 59,566 65,373 124,939 159,062 53,329 3,280 215,671 3,356,129 $ Year ended December 31,2020
		566,024 $ 535,601 17,033 1,118,658 $

33) Interest revenue

December 31,2021 December 31,2020 Interest income from margin loans 890,511 $ 566,024 $ Interest income from bonds 274,506 535,601 Others 33,189 17,033 Total 1,198,206 $ 1,118,658 $	December 31,2021 December 31,2020 Interest income from margin loans 890,511 $ 566,024 $ Interest income from bonds 274,506 535,601 Others 33,189 17,033 Total 1,198,206 $ 1,118,658 $	December 31,2021 December 31,2020 Interest income from margin loans 890,511 $ 566,024 $ Interest income from bonds 274,506 535,601 Others 33,189 17,033 Total 1,198,206 $ 1,118,658 $
34) Net valuation gain (loss) on trading securities at fair value through profit or loss December 31,2021 December 31,2020 Gain (loss) on sale of securities - dealer 1,090,619) ($ 1,007,647 $ Gain (loss) on sale of securities - underwriting 71,558 51,505) ( Gain (loss) on sale of securities - hedging 187,434 33,077 Total 831,627) ($ 989,219 $
	December 31,2021 1,090,619) $ 71,558 ( 187,434 831,627) $
		1,007,647 $ 51,505) 33,077 989,219 $

323

35) Net gain (loss) on covering of borrowed securities and bonds with resale agreements-short sales 36) Net valuation gain (loss) on borrowed securities and bonds with resale agreements-short sales at fair value through profit or loss 37) Net realized gain (loss) on financial assets measured at fair value through other comprehensive income–bonds 38) Net gain (loss) from issuance of call (put) warrants Year ended December 31,2021 Year ended December 31,2020 Gain (loss) from the bond investments under resale agreements 1,270) ($ 5,861) ($ Gain (loss) from securities borrowing transactions 217,126) ( 262,525 Gain (loss) from covering 36,503 11,775 Total 181,893) ($ 268,439 $ Year ended December 31, 2021 Year ended December 31,2020 Valuation gain (loss) from securities borrowing transactions 325,247) ($ 92,093) ($ Valuation gain (loss) from covering 12,088 24,928) ( Total 313,159) ($ 117,021) ($ Year ended December 31,2021 Year ended December 31,2020 Foreign bonds - $ 100,358 $ Year ended December 31,2021 Year ended December 31,2020 Net gain (loss) on changes in fair value of call (put) warrant liabilities and redemption 1,193,204) ($ 367,407 $ Net gain (loss) on exercise of call (put) warrants before maturity 1,443,684) ( 114,508) ( Expenses arising out of issuance of call (put) warrants 260,068) ( 157,494) ( Total 2,896,956) ($ 95,405 $	35) Net gain (loss) on covering of borrowed securities and bonds with resale agreements-short sales 36) Net valuation gain (loss) on borrowed securities and bonds with resale agreements-short sales at fair value through profit or loss 37) Net realized gain (loss) on financial assets measured at fair value through other comprehensive income–bonds 38) Net gain (loss) from issuance of call (put) warrants Year ended December 31,2021 Year ended December 31,2020 Gain (loss) from the bond investments under resale agreements 1,270) ($ 5,861) ($ Gain (loss) from securities borrowing transactions 217,126) ( 262,525 Gain (loss) from covering 36,503 11,775 Total 181,893) ($ 268,439 $ Year ended December 31, 2021 Year ended December 31,2020 Valuation gain (loss) from securities borrowing transactions 325,247) ($ 92,093) ($ Valuation gain (loss) from covering 12,088 24,928) ( Total 313,159) ($ 117,021) ($ Year ended December 31,2021 Year ended December 31,2020 Foreign bonds - $ 100,358 $ Year ended December 31,2021 Year ended December 31,2020 Net gain (loss) on changes in fair value of call (put) warrant liabilities and redemption 1,193,204) ($ 367,407 $ Net gain (loss) on exercise of call (put) warrants before maturity 1,443,684) ( 114,508) ( Expenses arising out of issuance of call (put) warrants 260,068) ( 157,494) ( Total 2,896,956) ($ 95,405 $	35) Net gain (loss) on covering of borrowed securities and bonds with resale agreements-short sales 36) Net valuation gain (loss) on borrowed securities and bonds with resale agreements-short sales at fair value through profit or loss 37) Net realized gain (loss) on financial assets measured at fair value through other comprehensive income–bonds 38) Net gain (loss) from issuance of call (put) warrants Year ended December 31,2021 Year ended December 31,2020 Gain (loss) from the bond investments under resale agreements 1,270) ($ 5,861) ($ Gain (loss) from securities borrowing transactions 217,126) ( 262,525 Gain (loss) from covering 36,503 11,775 Total 181,893) ($ 268,439 $ Year ended December 31, 2021 Year ended December 31,2020 Valuation gain (loss) from securities borrowing transactions 325,247) ($ 92,093) ($ Valuation gain (loss) from covering 12,088 24,928) ( Total 313,159) ($ 117,021) ($ Year ended December 31,2021 Year ended December 31,2020 Foreign bonds - $ 100,358 $ Year ended December 31,2021 Year ended December 31,2020 Net gain (loss) on changes in fair value of call (put) warrant liabilities and redemption 1,193,204) ($ 367,407 $ Net gain (loss) on exercise of call (put) warrants before maturity 1,443,684) ( 114,508) ( Expenses arising out of issuance of call (put) warrants 260,068) ( 157,494) ( Total 2,896,956) ($ 95,405 $
Year ended December 31,2021
		100,358 $ Year ended December 31,2020
	1,193,204) ($ 1,443,684) ( 260,068) ( 2,896,956) ($	367,407 $ 114,508) ( 157,494) ( 95,405 $

324

39) Net gain (loss) from derivatives

Net gain (loss) from derivatives
Impairment loss and reversal of impairment gain Other operating income Futures contract gain (loss) Option trading gain (loss) OTC option trading gain (loss) Net gain (loss) on foreign exchange derivatives Others Total Impairment (loss) and reversal of impairment gain Recovery of bad debts Total Income from securities lending Net currency exchange gain (loss) Handling fee revenues from funds Others Total	Year ended December 31, 2021 409,040 $ 166,004) ( 924,981) ( 83,242 41,690) ( 640,393) ($ Year ended December 31, 2021	Year ended December 31, 2020
		450,510 $ 203,770) ( 145,089) ( 43,196) ( 38,335) ( 20,120 $ Year ended December 31,2020
	7,664 $ 3,312 10,976 $ Year ended December 31, 2021 374,310 $ 184,209 59,579 126,848 744,946 $	18,181) ($ 2,202 15,979) ($ Year ended December 31,2020 151,265 $ 316,918) ( 46,873 72,440 46,340) ($

40) Impairment loss and reversal of impairment gain

41) Other operating income

42) Handling charges

Handling charges
Interest expense Brokerage handling fee expense Dealer handling fee expense Refinancing processing fee expense Total Interest expense from repurchase agreements Loans interest expense Other interest expense Total	Year ended December 31,2021 578,187 $ 172,742 4,649 755,578 $ Year ended December 31,2021 49,404 $ 40,273 11,610 101,287 $	Year ended December 31,2020
		378,899 $ 164,884 4,704 548,487 $ Year ended December 31,2020
		180,657 $ 82,378 13,849 276,884 $

43) Interest expense

325

44) Employee benefits expense

Employee benefits expense
Salaries Labor and health insurance Pension Other employee benefits Total	Year ended December 31, 2021 3,564,613 $ 174,172 89,092 174,467 4,002,344 $	Year ended December 31, 2020
		2,872,161 $ 137,785 77,378 115,012 3,202,336 $

A. In accordance with the Company’s Article of Incorporation, the remainder of the year-end income before taxes less income before appropriating employees’ compensation and directors’ remuneration, if any, shall appropriate an employees’ compensation no less than 1.6% and directors’ remuneration no more than 2%. However, when the Company has an accumulated deficit, earnings to cover the deficit shall first be retained before appropriating employees’ compensation and directors’ remuneration.
B. For the years ended December 31, 2021 and 2020, employees’ compensation was accrued at $94,748 and $81,804, respectively; directors’ remuneration was accrued at $94,748 and $81,804, respectively. The aforementioned amounts were recognized in salary expenses.
C. For the year ended December 31, 2021, employees’ compensation was estimated at 2% and directors’ remuneration at 2%, based on the period-end income before taxes less income before appropriating employees’ compensation and directors’ remuneration.
D. The actual distributed amount of employees’ and directors’ remuneration for 2020 as resolved by the Board of Directors was in agreement with the estimates in the 2020 financial statements.
E. Information on the appropriation of the Company’s earnings as resolved by the Board of Directors would be posted in the “Market Observation Post System” on the Taiwan Stock Exchange official website.

45) Depreciation and amortization

website. Depreciation and amortization
Depreciation Amortization Total	Year ended December 31,2021 189,361 $ 38,192 227,553 $	Year ended December 31,2020
		181,478 $ 28,361 209,839 $

46) Other operating expenses

Other operating expenses
Taxes Computer information expenses Security lending expenses TDCC service fee Others Total	Year ended December 31,2021	Year ended December 31,2020
	1,056,966 $ 181,692 179,411 134,050 478,238 2,030,357 $	771,087 $ 161,286 93,702 77,306 403,777 1,507,158 $

326

47) Other gains and losses

Other gains and losses
		Year ended		Year ended
	December 31, 2021		December 31, 2020
Financial income	$	111,787	$	154,603
Net gain (loss) on disposal of investments		62,303	(	49,665)
Net gain (loss) on valuation of non-opearting
financial instrument	(	24,318)		25,279
Net currency exchange loss	(	4,749)	(	6,149)
Other non-operating revenues		178,499		182,819
Total	$	323,522	$	306,887

48) Income tax

A. Income tax expense

(a) Components of income tax expense:

Income tax A. Income tax expense (a) Components of income tax expense:
				Year ended			Year ended
			December 31,2021			December 31, 2020
Current tax:
Current tax on profits for the periods		$		646,792		$	354,773
Prior year income tax overestimation				48,942	(		19,501)
Tax on undistributed surplus				852			-
Total current tax				696,586			335,272
Deferred taxes:
Temporary differences		(		38,524)			32,954
Total deferred taxes		(		38,524)			32,954
Income tax expense		$		658,062		$	368,226
(b) The income tax expense relating to components of other comprehensive						income is as follows:
				Year ended			Year ended
			December 31,2021			December 31, 2020
Remeasurement of defined benefit
obligations		($		25,149)	($		4,399)
B. Reconciliation between income tax expense and accounting profit
				Year ended			Year ended
		December 31,2021				December 31,2020
Tax calculated based on profit before tax and
statutory tax rate	$			966,498	$		840,916
Expenses disallowed by tax regulation	(			60,664)			23,050
Prior year income tax overestimation				48,942	(		19,501)
Tax exempt income by tax regulation	(			722,447)	(		772,176)
Effect from AlternativeMinimum Tax				424,881			295,937
Tax on undistributed surplus				852			-
Income tax expense	$			658,062	$		368,226

327

C. Amounts of deferred tax assets or liabilities as a result of temporary differences, tax losses and investment tax credits are as follows:

		Year ended December 31,2021	Year ended December 31,2021	Year ended December 31,2021	Year ended December 31,2021
	January1	Recognized in profit or loss		Recognized in other comprehensive income		December 31
94,947 $ - - 8,802 103,749 $ 8,950) ($ 983) ( 9,933) ($ 93,816 $
	January1		Recognized in profit or loss	Recognized in other comprehensive income		December 31
39,479 $ 90,543 5,243 135,265 $ 12,148) ($ - 746) ( 12,894) ($ 122,371 $		39,479) ($ - 3,559 35,920) ($ 12,148 $ 8,950) ( 232) ( 2,966 $ 32,954) ($		- $ 4,404 - 4,404 $ - $ - 5) ( 5) ($ 4,399 $	- $ 94,947 8,802 103,749 $ - $ 8,950) ( 983) ( 9,933) ($ 93,816 $

328

D. As of December 31, 2021, the Company’s income tax returns have been approved by the Tax Authority until 2018 and the Subsidiary Company’s income tax returns have been approved by the Tax Authority until 2019.
E. With respect to the income tax returns of the Company for 2018, the Tax Authority assessed to increase income tax payable by $4,581. The Company disagreed with the assessment and had filed for administrative remedy and had recognized the income tax expense based on the assessment.

49) Earnings per share

Basic earnings per share Net income attributable to common shareholders Dilutive effect of common stock equivalents Employee bonus Basic earnings per share Net income attributable to common shareholders Dilutive effect of common stock equivalents Employee bonus		Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 4,007,435 $ 1,455,831 2.75 $ - 4,006 4,007,435 $ 1,459,837 2.75 $ Year ended December 31,2021 Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 3,607,518 $ 1,455,831 2.48 $ - 4,624 3,607,518 $ 1,460,455 2.47 $ Year ended December 31,2020	Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 4,007,435 $ 1,455,831 2.75 $ - 4,006 4,007,435 $ 1,459,837 2.75 $ Year ended December 31,2021 Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 3,607,518 $ 1,455,831 2.48 $ - 4,624 3,607,518 $ 1,460,455 2.47 $ Year ended December 31,2020	Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 4,007,435 $ 1,455,831 2.75 $ - 4,006 4,007,435 $ 1,459,837 2.75 $ Year ended December 31,2021 Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 3,607,518 $ 1,455,831 2.48 $ - 4,624 3,607,518 $ 1,460,455 2.47 $ Year ended December 31,2020	Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 4,007,435 $ 1,455,831 2.75 $ - 4,006 4,007,435 $ 1,459,837 2.75 $ Year ended December 31,2021 Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 3,607,518 $ 1,455,831 2.48 $ - 4,624 3,607,518 $ 1,460,455 2.47 $ Year ended December 31,2020	Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 4,007,435 $ 1,455,831 2.75 $ - 4,006 4,007,435 $ 1,459,837 2.75 $ Year ended December 31,2021 Amount after tax Weighted-average outstanding common shares (In thousands) Earnings per share (In dollars) 3,607,518 $ 1,455,831 2.48 $ - 4,624 3,607,518 $ 1,460,455 2.47 $ Year ended December 31,2020

		3,607,518 $ - 3,607,518 $		1,455,831 4,624 1,460,455		2.48 $ 2.47 $

329

7. RELATED PARTY TRANSACTIONS

1) Names and relationships of related parties

Names of related parties

Uni-President Enterprises Corp.

Uni-President Asset Management Corp. President Tokyo Co., Ltd. President Tokyo Auto Leasing Co., Ltd. ScinoPharm Taiwan, Ltd. Ton Yi Industrial Corp. President Chain Store Corp. (PCSC) Presco Netmarketing Co., Ltd President Professional Baseball Team Co., Ltd Tainan Spinning Retail and Distribution Co., Ltd Kai Yu (BVI) Investment Co., Ltd Cayman President Holdings, Ltd. President Life Sciences Cayman Co., Ltd President (BVI) International Investment Holdings Ltd. Fund managed by Uni-President Asset Management Corp.

Relationship with the Company

Entity having significant influence on the Company Associate Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party

Security investment trust fund raised by the Uni-President Assets Management Corp.

2) Significant related party transactions and balances

A. Accounts receivable

nificant related party transactions and balances Accounts receivable
Other receivables Entity having significant influence on the company: Uni-President Enterprises Corp. Other related party: ScinoPharm Taiwan, Ltd. President Chain Store Corp. (PCSC) Others Total Other related party: Others	December 31,2021	December 31,2020
	312 $ 526 207 102 1,147 $ December 31,2021	25 $ 399 378 73 875 $ December 31,2020
	9 $	18 $

B. Other receivables

330

C. Guarantee deposit received

Guarantee deposit received
	December	31,2021	December	31,2020
Associate:
Uni-President Assets Management Corp.	$	1,044	$	1,044
Other related party:
President Tokyo Co., Ltd.		1,418		1,434
Total	$	2,462	$	2,478

－
D. Lease transactions lessee
(A) The Group leases business vehicles and multifunction printers, etc., from President Tokyo Co., Ltd. Rental contracts periods are typically 1 to 5 years. Rents are paid monthly.
(B) Right-of-use assets:
- a. Acquisition of right-of-use assets

ght-of-use assets: Acquisition of right-of-use assets
Disposition of right-of-use assets Other related party: President Tokyo Co., Ltd. President Tokyo Auto Leasing Co., Ltd. Total Other related party: President Tokyo Co., Ltd.	December 31, 2021 5,864 $ 3,732 9,596 $	December 31, 2020
		15,818 $ - 15,818 $ December 31, 2021
		2,601 $

b. Disposition of right-of-use assets

There were no transaction with related party at December 31, 2020.

(C) Lease liabilities
－
a. Lease liabilities current

ase liabilities Lease liabilities`－`current
Lease liabilities`－`non-current Other related party: President Tokyo Co., Ltd. President Tokyo Auto Leasing Co., Ltd. Total Other related party: President Tokyo Co., Ltd. President Tokyo Auto Leasing Co., Ltd. Total	December 31,2021	December 31,2020
	7,399 $ 737 8,136 $ December 31,2021	8,004 $ - 8,004 $ December 31,2020
	15,343 $ 2,934 18,277 $	18,108 $ - 18,108 $

－
b. Lease liabilities non-current

331

c. Interest expense

c. Interest expense
d. Gain on lease modification E. Bonds sold under repurchase agreements F. Structured notes Other related party: President Tokyo Co., Ltd. President Tokyo Auto Leasing Co., Ltd. Total Other related party: President Tokyo Co., Ltd. Other related party: Kai Yu (BVI) Investment Co., Ltd. Cayman President Holdings, Ltd. Total Other related party: Kai Yu (BVI) Investment Co., Ltd. Cayman President Holdings, Ltd. Total	Year ended December 31,2021 195 $ 2 197 $ Year ended December 31, 2021 17 $ December 31,2021 - $ 69,200 69,200 $	Year ended December 31,2020
		154 $ - 154 $ Year ended December 31, 2020
		- $ December 31,2020 148,096 $ 489,856 637,952 $ December 31,2020 116,768 $ 12,816 129,584 $

The above transaction amounts are respectively listed under the financial liabilities at fair value through profit or loss – current and other financial liabilities – current. There were no transaction with related party at December 31, 2021.

with related party at December 31, 2021.
G. Handling fee revenue Entity having significant influence on the company: Uni-President Enterprises Corp. Security investment trust fund raised by the Uni- President Asset Management Corp.: Uni-President Asset Management Corp. Other related party: Other Total	Year ended December 31,2021 $ 6 70,198 1,217 71,415 $	Year ended December 31,2020
		$ - 47,845 2,354 50,199 $

Terms of handling fee revenue mentioned above are similar to those of transactions with third parties.

332

H. Net gain (loss) on wealth management - trust income from sales of funds

		Year ended		Year ended
	December 31,2021		December 31,2020
Associates:
Uni-President Assets Management Corp.	$	6,730	$	5,260

The revenues were collected on a monthly basis in accordance with contract terms. I. Other operating revenue - consultation revenue

I.	Other operating revenue-consultation revenue
J.	Other operating revenue-handling fee revenues from underwriting funds Year ended December 31,2021 Associates: Uni-President Assets Management Corp. 2,400 $ Year ended December 31, 2021 Associates: Uni-President Assets Management Corp. 53,784 $	Year ended December 31,2020
		2,400 $ Year ended December 31, 2020
		45,022 $

The revenues were collected on a monthly basis in accordance with contract terms. K. Rent income

ent income
Associates: Uni-President Assets Management Corp. Other related party: President Tokyo Co., Ltd. Total	Period 2016.01.01~2024.03.31 2018.04.01~2024.03.31	Deposit 1,044 $ 1,418	Year ended December31,2021		Year ended December31,2020
			6,490 $ 9,061 15,551 $		6,811 $ 9,422 16,233 $

Rental income mentioned above is derived from leasing part of the Group’s office space and business premises to various related parties and calculated as agreed by both parties. Lease payments are collected on schedule in accordance with the terms of the lease contracts. L. Revenues from underwriting business

evenues from underwriting business
Entity having significant influence on the company: Uni-President Enterprises Corp.		Year ended December 31,2021		Year ended December 31,2020
		600 $		300 $

333

M.Stock custodian income

Entity having significant influence on the company: Uni-President Enterprises Corp. Associate: Uni-President Assets Management Corp. Other related party: ScinoPharm Taiwan, Ltd. Ton Yi Industrial Corp. President Chain Store Corp. (PCSC) Others Total	Year ended December 31,2021 3,908 $ 134 2,547 1,271 2,478 667 11,005 $	Year ended December 31,2020 3,697 $ 135 2,635 1,220 2,097 663 10,447 $

Terms of stock custodian income mentioned above are similar to third parties. N. Net gain (loss) from derivatives

Net gain (loss) from derivatives	Net gain (loss) from derivatives
Other operating expenses-equipment rental and copy expense a. Equipment rental b. Copy expense Year ended December 31,2021 Other related party: Cayman President Holdings, Ltd. 1,360) ($ Kai Yu (BVI) Investment Co., Ltd 1,290) ( Total 2,650) ($ Year ended December 31,2021 Other related party: President Tokyo Co., Ltd. 18 $ Year ended December 31,2021 Other related party: President Tokyo Co., Ltd. 592 $		Year ended December 31,2020
		1,189) ($ 36) ( 1,225) ($ Year ended December 31,2020 413 $ Year ended December 31,2020 1,476 $
a. Equipment rental b. Copy expense Other related party: President Tokyo Co., Ltd. Other related party: President Tokyo Co., Ltd.
	18 $ Year ended December 31,2021
	592 $

O. Other operating expenses - equipment rental and copy expense

334

c. Advertising expense

	c. Advertising expense
P. Q.	Financial expense Purchases of trading securities–dealer Year ended December 31,2021 Other related party: Presco Netmarketing Co., Ltd 15,395 $ President Professional Baseball Team Co., Ltd 2,310 Tainan Spinning Retail and Distribution Co., Ltd 2,000 Others 473 Total 20,178 $ Year ended December 31,2021 Other related party: Cayman President Holdings, Ltd. 1,601 $ Kai Yu (BVI) Investment Co., Ltd 2,080 President Life Sciences Cayman Co., Ltd - President (BVI) International Investment Holdings Ltd. - Total 3,681 $ Ending Shares (In thousands) Ending Balance Entity having significant influence on the company: Uni-President Enterprises Corp. 100 6,860 $ ( Security investment trust fund raised by the Uni-President Asset Management Corp.: Uni-President Asset Management Corp. - 49,347 Other related parties: President Chain Store Corp. - - ( Others 54 816 ( Total 57,023 $ December 31,2021	Year ended December 31,2021	Year ended December 31,2020
			- $ 2,100 - 522 2,622 $ Year ended December 31,2020
			1,134 $ 155 212 564 2,065 $ Year ended December 31,2021
			Gain(loss) 67) $ 3,084 367) 179) 2,471 $

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Entity having significant influence on the company: Uni-President Enterprises Corp. Security investment trust fund raised by the Uni-President Asset Management Corp.: Uni-President Asset Management Corp. Other related parties: President Chain Store Corp. ScinoPharm Taiwan, Ltd. Others Total	Ending Shares (In thousands) 5 - - - - December 31,	Year ended December 31,2020 Ending Balance Gain(loss) 338 $ 2,029) ($ 10,315 - - 119) ( - 47) ( - 1) ( 10,653 $ 2,196) ($ 2020

R. Compensation of key management personnel The compensation of key management such as directors, general managers, vice general managers were as follows:

ere as follows:
Salary and short-term employee benefits Retirement benefits Other long-term employee benefits Termination benefits Share-based payment Total		Year ended December 31,2021		Year ended December 31,2020
		388,292 $ 1,666 - - - 389,958 $		328,118 $ 1,379 - - - 329,497 $

(Blank below)

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8. PLEDGED ASSETS

The Company’s assets pledged or restricted for use were as follows:

Assets

December 31, 2021 December 31, 2020

Purposes

Financial assets at fair value through profit or loss - current: Trading securities (par value) - Corporate bonds $ 500,000 $ 950,000 Securities for bonds sold under repurchase agreements - Government bonds 1,507,300 2,634,800 Securities for bonds sold under repurchase agreements - International bonds 623,210 1,034,879 Securities for bonds sold under repurchase agreements - Bank debentures 300,000 200,000 Securities for bonds sold under repurchase agreements - Overseas bonds 7,124,566 15,119,396 Securities for bonds sold under repurchase agreements Other current assets: - Demand deposits 5,244,571 652,010 Collections on behalf of third parties and reimbursement for wages and stocks - Pledged time deposits 521,021 525,249 Securities for short-term loans Financial assets at fair value through profit or loss - non-current: - Government bonds (par value) 50,000 50,000 Trust fund deposit-out Property and equipment - Land and buildings (book value) 1,096,408 1,101,768 Securities for short-term loans and guarantees for issuance of commercial papers Pledged time deposits - Operating guarantee deposits 655,000 655,000 Security deposits - Refundable deposits 2,000 2,181 Security deposits

9. SIGNIFICANT COMMITMENTS

None.

10. SIGNIFICANT LOSS FROM NATURAL DISASTER

None.

11. SIGNIFICANT SUBSEQUENT EVENT

None.

12. OTHER

1) Management objective and policy of financial risks

A. Risk management objective

The Group continually strengthens risk culture to every employee and makes sure that the Group can actively develop various businesses under a healthy and effective risk management system. At the same time, by creating value of an entity and continually increasing profit, profit maximization may be achieved within appropriate risk tolerance.

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B. Risk management system
In order to ensure the completeness of risk management system, run the balancing mechanism of risk management, and improve the division efficiency of risk management, the Group sets up “Risk Management Policy”. Such policy aims to establish internal system compliance and the guiding tools for policies communication within the Group and enable every layer of the Group engaged in different tasks to identify, evaluate, monitor, and control various risks with establishment of consistent compliance rules for risks of each business so that the risks can be controlled within the limits set in advance.
The Group’s risk management system covers risks incurred from businesses on and off the balance sheet, such as market risk, credit risk, liquidity risk, operating risk, legal risk, model risk which are all included in the risk management.
C. Risk management organization
Risk management organization: Board of Directors, Risk Management Committee, Risk Control Office, Business units and other related segments (such as Office of Auditing, Office of General Manager, Compliance segment, Legal segment, Finance segment and Settlement segment) are in charge of planning, supervising and execution.
(A) The Board of Directors should ensure the effectiveness of risk management and be responsible for the ultimate result and the following duties:
- a. To establish proper risk management system, operating process, and risk management culture in the Group with allocation of necessary resource for better execution and operation.
- b. Policy of risk management review
- c. Review and approval of business application, transaction authorization and risk limit.
(B) The Risk Management Committee reports to the Board of Directors and is responsible for the following:
- a. Review risk management policy
- b. Review the highest risk tolerance
- c.Submit regular reports to the Board of Directors in relation to the risk management status of the whole Group
(C) The General Manager supervises daily risk management of the entire Group and is responsible for the following:
- a. Supervise and monitor daily risk management of the entire Group
- b. Approval of management exceptions
(D) Assets and Liabilities Committee reports to the General Manager and is responsible for the following:
- a. Set up the ultimate guidelines for assets and liabilities management of the entire Group
- b. Analyze and control the entire Group’s assets and liabilities portfolio
- c. Approval of various businesses’ quotas
- d. Gather and analyze information on domestic and offshore interest rate, exchange rate, prosperity fluctuation, political and economic environmental changes, and predict the financial trend in the future
(E) Risk Control Office implements risk management policy and related regulations and reports to the Risk Management Committee. Risk Control Office also reports daily risk management to the General Manager and is responsible for the following:
- a. Establish Risk Management Policy of the entire Group
- b. Develop effective method for measurement and risk management in an entity
- c. Review risk management system of business units
- d. Generate risk report through information gathering and consolidation
- e. Analyze various business risks and report to the General Manager

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f. Report the risk management situation to the Risk Management Committee according to a meeting’s nature and needs
g. Carry out duties as designated by the Risk Management Committee and control risks of business units
(F) Auditing Office is responsible for the following:
a. Execute operating risk control
b. Include the risk management system into internal audit program and carry out the daily audit schedule.
c. Assess the effectiveness of internal control and verify the executed result.
(G) Compliance segment and legal segment under the Office of General Manager are responsible for the following:
a. Compliance segment should make sure that the business operation and risk management system are in compliance with relevant regulations.
b. Legal segment is responsible for legal risk control
c. Compliance segment also provides services of Anti-Money Laundering and Counter Terrorism Financing, including designs specification and internal control, establishes transaction monitoring, oversees the effective implementation of business units, conducts the employee training and reports any suspicion of money laundering.
(H) Finance segment is responsible for the following:
a. Verify the correctness of position information and reasonability of profit and loss calculation.
b. Control and analyze self-owned capital adequacy ratio.
c. Analyze the appropriateness of structures of the assets and liabilities.
(I) Business units are responsible for the following:
a. Set up risk management details of various businesses according to the risk management policy and other related regulations.
b. Provide sufficient position information and risk control information to the Risk Control Office.
(J) Settlement division is responsible for:
a. Clearing and settlement; risk control and management of margin purchase and short sale of securities.
b. Risk control and management of trading middle office and enforcement of rules governing

risk management of business segments.

D. Risk management policy

In order to ensure the completeness of risk management system, run the balancing mechanism of risk management, and improve the division efficiency of risk management, the Group sets up “Risk Management Policy”. Such policy aims to establish internal system compliance and the guiding tools for policies communication within the Group and enable every layer of the Group engaged in different tasks to identify, evaluate, monitor, and control various risks with establishment of consistent compliance rules for risks of each business so that the risks can be controlled within the limits set in advance.

Risk management processes include risk identification, risk evaluation, risk supervision and various risk control. Each kind of risk evaluations and responding strategies are described as follows:

(A) Market risk management

The Group has implemented risk management information system (Risk Manager) in relation to market risk control. All trading positions of the Group have been included in the

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daily risk control system for the calculation of Value at Risk (VaR). Limit exceeding indicators are mainly the nominal principal, stop-loss, sensitivity (Greeks) and VaR. The risk management report is presented on a daily basis for implementation of regular control and limit exceeding handling procedures.

(B) Credit risk management
In relation to risk control, the quantitative model of default rate adopts KMV model to calculate the default rate of issuers with credit exposure of the issuing company and the trading counterparties, and credit risk of securities disclosed in the report. The credit exposure is mitigated through regular review of credit status.
(C) Fund liquidity risk

E. Hedging and risk-offsetting strategy
- (A) Policies of hedging and risk mitigating are parts of the Group’s risk management policies, and the hedging position and hedged trading position are supposed to be one portfolio, of which the gain and loss and risk information are measured on a consolidated basis.
- (B) The overall position (hedging position and trading position) is included in the daily risk management system to calculate Value at Risk and other relevant information. Limit exceeding indicators mainly include nominal principal, stop-loss point, price sensitivity and VaR. With the presentation of daily risk management report, routine control and limit exceeding treatment can be executed.
- (C) The continued effectiveness of hedging and risk-offsetting strategy is measured by the gain and loss of overall position (hedging position and trading position), in order to track reasonableness of the profit or loss of hedging position and the offsetting relationship with the profit or loss of trading position, and to control them within a reasonable range.
2) Credit risk
A. Source and definition of credit risk

The credit risk exposure of the Group as a result of engagement in financial transactions include issuer’s credit risk, credit risk of counterparty and credit risk of underlying assets:

(A) Credit risk of the issuer refers to the issuers of financial debt instruments held by the Group failing to repay its obligation due to the fact that the issuer breaches the contract resulting in the risk of financial loss to the Group.
(B) Credit risk of counterparty refers to risk of financial loss to the Group arising from default by the counterparty of financial instruments on the settlement or payment obligation.
(C) Credit risk of the underlying assets happens when the credit rating of the underlying assets linked to the financial instrument is downgraded by the rating agency or when the losses occur as a result of contract default.
The financial assets held by the Group which could result in credit risk include bank deposit, debt securities, derivatives transactions in OTC, bonds purchased/sold under resale/repurchase agreements, refundable deposit of securities lending, futures trade margins, other refundable deposits and receivables.
B. Maximum credit risk exposure and credit risk concentration
The maximum exposure to credit risk of financial assets in the consolidated balance sheet, without consideration of the collateral or other credit enhancements, is equivalent to the carrying amount. In Taiwan, the sources of credit risk of the Group are primarily resulting from cash deposited with banks or other financial institutions, debt securities issued or guaranteed by a bank, derivative instruments transaction underwritten by the Group, and all counterparties of customer margin deposits accounts being financial institutions. Credit risks of various financial

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assets are as follows:

(A) Cash and cash equivalents

Cash and cash equivalents include time deposit, demand deposits and checking deposits. Correspondent institutions are mainly domestic financial institutions.

(B) Financial assets at fair value through profit and loss -current
a. Fund

The funds held by the Group are bond funds. As the positions held are not significant, credit risk is deemed low.

b. Commercial papers

The commercial papers held by the Group are under resale agreements. As all the counterparties are financial institutions with good credit, the credit risk from counterparties is extremely low.

c. Debt securities

Debt securities are mainly positions like government bonds, convertible corporate bonds and foreign bonds and the issuers are primarily R.O.C. government, domestic and foreign legal entities. 42% of convertible corporate bond is guaranteed by banks. Details are as follows:

(a)Government bonds

The bonds held by the Group are mostly government bonds (inclusive of central and local government). As a whole, the credit risk of the bonds held by the Group is low.

(b) Corporate bonds

The corporate bonds held by the Group are mainly underlying investment with good credit rating and those with rating above (S&P BB).

(c)Convertible corporate bond

The convertible corporate bonds held by the Group are mostly issued by the domestic legal entities. The Group mitigates highly risky credit exposure of the issuers by control through Taiwan Corporate Credit Risk Index (TCRI).

(d)Foreign bonds

The foreign bonds held by the Group are mainly underlying investment with good credit rating and those with rating above (S&P BB).

The foreign government bonds held by the Group are classified as debt instruments at fair value through other comprehensive income. In general, the bonds held by the Group are with lower credit risk.

(D) Derivatives- futures trade margin

When engaging in futures trades in stock exchange market, the Group needs to deposit margin into a margin deposit account of a financial institution designated by the futures merchants as a guarantee to fulfil contractual obligation in the future. As a result, the credit risk is low.

(E) Derivatives-OTC

The Group signs International Swaps and Derivatives Association (ISDA) agreements with each counterparty when engaging in OTC derivatives as an agreement regarding such transactions for both parties. In the agreement, it provides a fundamental contractual model for OTC derivative transactions. If any party breaches the contract or terminates the transactions early, then all the open interest covered in the agreement should be settled by net amount as bound in the contract. When the ISDA agreement is signed, the Credit Support Annex (CSA) is also signed. According to the CSA, collateral will be transferred from a party to the other during transaction process to mitigate the risk of counterparty in open interest. Please refer to Note 6(10).

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Types of OTC derivative transactions in which the Group is engaged include structured notes and swap transaction. The counterparties are all from financial service industry and mainly located in Taiwan, United States, and United Kingdom.

(F) Bonds investment under a resale agreement Bonds sold under a resale agreement are the bonds that the client sold to the Group at a price, interest rate, length of period as agreed by two parties and the client shall repurchase the bonds at the specified price upon maturity. The Group needs to assume credit risk from counterparties when underwriting such business, as the payment being delivered to the other party. With consideration of good collateral obtained, the net of credit risk exposure from counterparties can be effectively reduced. As all the counterparties are financial institutions with good credit rating, the credit risks from counterparties are extremely low. Please refer to Note 6(9).
(G) Margin loans receivable
Margin loans receivable are the loans provided to the client in order to process businesses of margin trading and short sale using the securities purchased through financing as collateral. The Group monitors the clients’ margin ratio through information system on a daily basis. As the margin ratio of margin trading is set at 130% according to Regulations Governing the Conduct of Securities Trading Margin Purchase and Short Sale Operations by Securities Firms, the credit risk is extremely low.
(H) Receivables of securities business money lending Receivables of securities business money lending are the non-restricted purpose loan business and monetary financing business, pursuant to an agreement between a securities firm and a customer, using customer securities and other commodities as collateral. The Group regularly assesses its customer line of credit and implements appropriate credit control. As the margin ratio of margin trading is set at 130% according to Regulations Governing the Conduct of Securities Trading Margin Purchase and Short Sale Operations by Securities Firms, the credit risk is extremely low.
(I) Guaranteed price for securities lending Guaranteed price for securities lending is the sale price of the Group’s securities sold by other securities firms through margin trading after deduction of securities transactions tax and service fee, which is deposited in other securities firms as collateral. As all the counterparties are financial institutions with good credit rating, the credit risk from counterparties is extremely low.
(J) Refundable deposits for securities lending Refundable deposits for securities lending are the margins deposited in other securities firm as collateral when the Group’s securities are sold. As all the counterparties are financial institutions with good credit, the credit risk from counterparties is extremely low.
(K) Receivables
Receivables are the credit rights arising from the securities business including settlement receivables of consignment trading, settlement receivables of operating securities sold, financing interest receivables of self-operating credit transaction, receivables of consignment trading for securities, and receivables from banks’ underwriting on foreign exchange transactions and foreign fund demand. As the majority of the Group’s receivables from the consignment businesses and self-operating businesses are settlement of securities from OCT or TWSE, the credit risk is extremely low. As the foreign exchange transactions are simply the receipt or payment of different currencies and the correspondent banks are of good credit rating, the credit risk is extremely low.
(L) Other current assets

Other current assets are mainly the collateral deposited in the bank for application for short-

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term debt limit and guarantee for application for issuance of commercial papers. As the correspondent banks are all financial institutions with good credit rating, the credit risk is extremely low.

(M) Financial assets at fair value through profit and loss – non-current In order to underwrite trust business, the Group deposits central government bonds in the Central Bank as collateral. Regardless of the bonds themselves or the financial institutions where the bonds are deposited, the credit risk is extremely low.
(N) Other non-current assets
- Other non-current assets mainly comprise operating guarantee deposits, settlement funds, and refundable deposits. Operating guarantee deposits are mainly deposited in domestic banks with good credit rating. Settlement funds are deposited in securities exchange. Settlement funds are used as compensation when a party to a marketable securities transaction fails to fulfil the settlement obligation. The credit risks from the institutions where these two assets are deposited are extremely low. The refundable deposits refer to cash or other assets which are deposited externally by the Group and can be used as refundable deposits. Because deposits are placed in various financial institutions and each deposit amount is small, the credit risk is dispersed and the credit exposure of overall refundable deposit is extremely low.
C. Expected credit loss assessment
In the assessment of impairment and calculation of expected credit losses, the Group considers reasonable and supporting information about past events, current conditions and future economic conditions. The Group determines at the balance sheet date whether there has been a significant increase in credit risk since initial recognition or whether credit impairment has occurred, and recognizes expected credit loss according to which stage the asset belongs: no significant increase in credit risk or low credit risk at balance sheet date (Stage 1), significant increase in credit risk (Stage 2), and credit impaired (Stage 3). 12-month expected credit losses are recognized for assets in Stage 1, and lifetime expected credit loses are recognized for assets in Stage 2 and Stage 3.

The definition of and expected credit losses recognized for each stage are as follows:

Item	Stage 1	Stage 2	Stage 3
Definition	No significant deterioration of credit quality of the financial asset since initial recognition, or the financial asset is considered low-risk at the balance sheet date.	Significant deterioration of credit quality of the financial asset since initial recognition, but the asset is not yet credit impaired.	The financial asset is credit impaired at the financial reporting date.
Expected credit losses recognition	12-month expected credit losses	Lifetime expected credit losses	Lifetime expected credit losses

(A) Judgements of the significant increase in credit risk since initial recognition

Judgements and assumptions used to determine whether the credit risk has a significant increase since initial recognition when the Group calculates expected credit loss under IFRS 9 are as follows:
a. If contractual payments are over 30 days past due according to the payment terms, the financial asset is considered to have significant increase in credit risk since initial recognition.
b. There is significant increase in credit risk at the reporting date if the credit rating of the issuer has been downgraded by more than 2 grades and the final external credit rating at

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the reporting date is non-investment grade, if the interest payments are over 30 days past due, or if there has been a default in the past.

(B) Definition of default and credit-impaired financial assets
According to the definition of credit impairment set by IFRS 9, a financial asset is creditimpaired when one or more events that have occurred and have a significant impact on the expected future cash flows of the financial asset. The criteria used to judge whether a financial asset is credit-impaired since initial recognition includes but is not limited to the following:
a. Contractual payments or principal or interest payments on bonds are over 3 months (90 days) past due.
b. Bond investment is rated as “in default” by external credit rating agencies.
c. Bond issuer has filed for bankruptcy, restructure, or other debt clearance procedures.
d. Issuer or counterparty has financial difficulties.
(C) Writing-off policy

If any of the following condition applies, the Group will write off the non-recoverable portion of the overdue receivables as bad debt.

a. Debt cannot be fully or partially recovered due to dissolution of, disappearance of, settlement with, bankruptcy declaration by the debtor, or any other reason.
b. The collateral and the assets of the primary and secondary debtors could not be auctioned off after multiple attempts and multiple price discounts, and the Company has not received any real benefits in assuming the collateral.
c. Payments are over two years past due and could not be recovered after attempts to collect.
(D) Measurement of expected credit losses
The Group considers reasonable supporting information which shows significant increase in credit risk since initial recognition when calculating expected credit losses. Main indexes include: internal/external credit rating, information of past due, credit spread, other market information in relation to the borrower, issuer or counterparty, and significant increase in credit risk of other financial instrument of the same borrower.
a. Investments in bills and bonds
- (a)Probability of default was based on external credit rating, which include forwardlooking information.
- (b)Loss given default was based on the average loss given default of external credit rating of investment position and counterparties.
- (c)Exposure at default

Stage 1, Stage 2 and Stage 3: Total carrying amount (including interest receivable).

(E) Consideration of forward-looking information

Historical loss rate (based on the historical experience in the past 3 to 5 years) as obtained

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and compared with economic environment in the past, nowadays and future (forwardlooking factor) to see whether there is any significant change, and then to properly adjust future loss rate standards. If any significant default event occurs, the loss rate in the current year will be included in the calculation of future loss rate standard.

D.Table of movements in loss provision of the Group
(A) For the years ended December 31,2021 and 2020, there were no changes in the loss allowance for investments in debt instruments measured at fair value through other comprehensive income.
(B) Except for bond interest receivable which was evaluated along with debt investments, the Group applies the simplified approach to measure the loss allowance at an amount equal to lifetime expected credit losses for marginal receivables, accounts receivable, other receivable-others and overdue receivables. The movements in loss provision of marginal receivables, accounts receivable, other receivable-others and other non-current assetsoverdue receivables of the Group are as follows:

			Year ended December 31,2021	Year ended December 31,2021	Year ended December 31,2021	Year ended December 31,2021	Total
	Marginal receivable		Accounts receivable	Other receivable		Other non- current assets- overdue receivables
58,840 $ 11,407) ( - 47,433 $ Marginal receivable							99,578 $ 7,664) ( 30,369) ( 61,545 $ Total
	Marginal receivable		Accounts receivable		Other receivable	Other non- current assets- overdue receivables
	43,806 $ 15,034 - 58,840 $	656 $ 31) ( - 625 $			54 $ 671 - 725 $	240,073 $ 2,507 203,192) ( 39,388 $	284,589 $ 18,181 203,192) ( 99,578 $

3) Liquidity risk

A. Definition and source of liquidity risk

Liquidity risk refers to possible financial losses arising from the inability to realize the asset or to obtain sufficient fund to fulfil the financial liabilities soon to be matured. Above situations may weaken the sources of cash from the Group’s trading and investment activities.

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B. Liquidity risk management procedure and stimulation test
In order to prevent operational crisis as a result of liquidity risk, the Group has established responding crisis process with regular monitoring over liquidity gap of fund.
(A) Procedure
- In addition to the operating capital for various business and long-term investment, the Group needs to maintain revolving funds at a certain level for daily operation. The use of remaining fund shall avoid high concentration and should be based on the principle of holding sound earning assets with high liquidity and treated in compliance with policies of the Group.
- The responsive unit for fund procurement adjusts the liquidity gap to ensure proper liquidity according to the daily volume and movement in the market.
(B) Stimulation test
- a. The Group reviews fund liquidity risk from a perspective of supply and demand of fund every month with simulation analysis of available fund for emergency including scenario analysis of cash, funding limit of financial institutions, margin loans and short sale, and value of disposal of position in order to compute maximum available fund and fund demand. Finally, safety stock of fund is reviewed to monitor liquidity risk.
- b. Above liquidity risk is generally reviewed monthly. However, if the available limit of increment banking credit risk in financing limit of a financial institution is lower than a certain amount (that is, the amount may be timely adjusted according to the fund liquidity in the market and the actual fund demand and supply in an entity), the safety stock will be reviewed weekly. After the early warning report for fund is submitted, the head of finance segment will call for a fund control meeting.
- c. Other than individual funding liquidity risk of an entity, stress test of minimization funding supply and maximization funding demand in the event of significant crisis is simulated, including:
  - (a)When there is a significant crisis in the market, the financing limit of the financial institutions and the value of disposal of position can be deemed the minimized ratio of fund supply which is then adjusted according to actual condition to compute the total fund supply under maximum stress.
  - (b)Except for the operating expense, the stock concept is adopted for the calculation of total fund demand under maximum stress.
  - (c)The Group should conduct a review to see whether the total minimized fund supply is more than maximized total fund demand. The Group should further review how long (by month) the difference may cover the operating expenses so that the safety stock of fund (by month) under stress test can be computed.
  - (d)The minimum safety stock of fund under stress test (by month) may be adjusted according to the crisis itself and only operating expense for at least 6 months under a normal stimulation can be deemed safe.
C. Maturity analysis for the financial assets and financial liabilities held for liquidity risk management
(A) The Group holds cash and sound earning assets with high liquidity in order to fulfil the payment obligation and potential emergency fund demand in the market. Financial assets held for liquidity risk management are mainly cash and cash equivalents, among which, all time deposits mature within a year. Financial assets at fair value through profit and loss are mainly listed stocks, convertible bonds and debt securities. As all of them have positions in active market, the liquidity risk is deemed low.

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(B) Maturity analysis for the financial liabilities is as follows:

		December 31,2021
Immediately	Less than 3 months	3-12 months	1-5years - $ - - - - - - 39,435 - - 88,583 - - 125,840 253,858 $	Total
- $ - 5,124,283 3,048,329 - 1,202,587 1,559,162 - 21,328,174 18,295,511 5,639,615 5,605 - - 56,203,266 $	590,000 $ 8,650,000 - - 9,648,756 - - 1,069,699 - 42,701 13,902 369,839 1,789,878 23,927 22,198,702 $	- $ - - - - - - 860,073 - - - 2,252,479 3,193,261 46,813 6,352,626 $		590,000 $ 8,650,000 5,124,283 3,048,329 9,648,756 1,202,587 1,559,162 1,969,207 21,328,174 18,338,212 5,742,100 2,627,923 4,983,139 196,580
				85,008,452 $

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		December 31,2020
Immediately	Less than 3 months	3-12 months	1-5years - $ - - - - - - - - - 80,784 - - 111,621 192,405 $	Total
- $ - 1,039,794 1,552,957 - 1,381,470 1,809,955 - 21,087,134 19,128,785 1,010,210 985 - - 47,011,290 $	946,276 $ 7,300,000 - - 19,112,268 - - 803,016 - 49,699 10,071 343,998 2,017,803 25,683 30,608,814 $	- $ - - 31,668 - - - 100,836 - - - 1,771,430 3,990,507 61,014 5,955,455 $		946,276 $ 7,300,000 1,039,794 1,584,625 19,112,268 1,381,470 1,809,955 903,852 21,087,134 19,178,484 1,101,065 2,116,413 6,008,310 198,318
				83,767,964 $

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4) Market risk

A. Definition of market risk

Market risk refers to the risk of decrease in the Group’s revenue or value of investment portfolio as a result of the changes in exchange rate, commodity price, interest rate, and stock price or other market risk factors.

The Group continually exercises risk management tools such as sensitivity analysis, Value at Risk, stress test and so on to completely and effectively measure, monitor and manage market risk.

B. Value at Risk (VaR)

Value at Risk is used to measure the possible maximum potential losses in investment portfolio as a result of movement in market risk factor in a specified period and confidence level. The Group currently uses confidence level of 95% to calculate Value at Risk of one day.

A VaR model must reasonably, completely and accurately measure the maximum potential risks of financial instruments or investment portfolio before being adopted as a risk management model by the Group. The VaR model used in risk management is continually certified and retrospectively tested to demonstrate that the model can reasonably and effectively measure the maximum potential risks of financial instruments or investment portfolios.

ximum potential risks of financial instruments	or investment portfolios.
Year ended December 31, 2021 Amount December 31, 2021 107,421 $ VaR Maximum 289,678 VaR Average 142,004 VaR Minimum 30,471 Statistical table for one-dayVaR of transactions	Statistical table for one-day VaR of transactions
	Year ended December 31,2020 Amount December 31, 2020 173,104 $ VaR Maximum 276,264 VaR Average 161,107 VaR Minimum 77,219

Statistical table for VaR of various risk indicators of transactions

Year ended

Year ended
December 31,2021	Foreign exchange 1,402 $ 16,846 4,119 1,102 Foreign exchange 3,433 $ 55,596 7,221 1,495	Interest 23,468 $ 43,928 21,552 7,594 Interest 24,026 $ 91,620 39,296 15,428	Share ownership
December 31, 2021 VaR Maximum VaR Average VaR Minimum Year ended December 31,2020			106,744 $ 292,526 141,182 30,858 Share ownership 176,351 $ 268,560 158,394 73,478
December 31, 2020 VaR Maximum VaR Average VaR Minimum

C. Information on gap of foreign exchange risk

The following table summarizes financial instruments of foreign assets or liabilities by currency and the foreign exchange exposure presented by book value as of December 31, 2021 and 2020 ：

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							December 31,2021	December 31,2021	December 31,2021
		USD		EUR		AUD		RMB		HKD		Others		Total
Financial assets in foreign currencies
Cash and cash equivalents	$	582,036	$	2,769	$	2,005	$	302,720	$	1,069,767	$	235,639	$	2,194,936
Financial assets at fair value through profit or loss		8,060,638		1,935,974		181,807		798,106		257,088		513,697		11,747,310
Bonds purchased under resale agreements		27,401		-		-		-		-		-		27,401
Investments accounted for under the equity method		-		-		-		2,363,197		-		-		2,363,197
Others		7,681,439		21,826		40,836		27,141		1,253,782		109,487		9,134,511
Financial liabilities in foreign currencies
Financial liabilities at fair value through profit or loss		4,332		1,599		106		2,828		195		359		9,419
Bonds sold under repurchase agreements		4,644,791		1,688,801		160,708		588,851		-		136,622		7,219,773
Others		9,528,760		18,141		40,178		314,020		959,851		114,068		10,975,018
Note: As of December 31, 2021, foreign exchange rates of		the above	currencies to TWD were 1 USD				= 27.680 TWD; 1		EUR= 31.320 TWD;
1 AUD= 20.080 TWD; 1 RMB= 4.344 TWD; and 1	HKD= 3.549 TWD,			respectively.

							December 31,2020	December 31,2020	December 31,2020
		USD		EUR		AUD		RMB		HKD		Others		Total
Financial assets in foreign currencies
Cash and cash equivalents	$	443,058	$	4,174	$	2,247	$	455,155	$	560,409	$	173,237	$	1,638,280
Financial assets at fair value through profit or loss		13,300,410		3,486,806		1,006,892		1,267,289		404,502		428,144		19,894,043
Investments accounted for under the equity method		-		-		-		2,531,901		-		-		2,531,901
Others		7,745,156		23,028		1,918		55,006		2,553,641		96,586		10,475,335
Financial liabilities in foreign currencies
Short-term loans		318,976		-		-		-		367,300		-		686,276
Financial liabilities at fair value through profit or
loss		50,740		3,898		3,441		3,426		172		5,422		67,099
Bonds sold under repurchase agreements		9,996,698		3,080,106		853,836		871,401		-		286,703		15,088,744
Others		9,879,276		12,626		240		282,393		1,286,407		95,701		11,556,643

Note: As of December 31, 2020, foreign exchange rates of the above currencies to TWD were 1 USD = 28.480 TWD; 1 EUR= 35.020 TWD; 1 AUD= 21.950 TWD; 1 RMB= 4.377 TWD; and 1 HKD= 3.673 TWD, respectively.

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     - D. The total exchange gain, including realized and unrealized, arising from significant foreign exchange variation on the monetary items held by the Group for the years ended December 31, 2021 and 2020, amounted to $179,460 and ($323,067), respectively.

5) Fair values and hierarchy information
A. Financial instruments and non-financial instruments not measured at fair value.
- Except for those listed in the table below, the carrying amounts of the Group’s financial instruments not measured at fair value (including cash and cash equivalents, bonds purchased under resale agreements, margin loans receivable, refinancing guaranty deposits, guaranteed proceeds receivable from refinancing, guaranteed price deposits for security borrowing, security borrowing deposits, customer margin deposit account, notes and accounts receivable, other receivables, short-term loans, commercial paper payable, bonds sold under repurchase agreements, guarantee deposit received from short sales, guaranteed price deposits received from securities borrowers, security borrowing deposits, equity of futures traders, accounts payable, collection for others, and other payables) approximate their fair values. The fair value information of financial instruments measured at fair value is provided in Note 12(5)3.

Non-financial assets December 31, 2021 Investment property December 31, 2020 Investment property	Total 712,476 $ 667,546	Quoted prices of the same assets in active markets (level 1)	Other significant observable inputs (level 2)	Significant non-observable inputs(level 3)
		- $ -	$ 712,476 667,546	- $ -

The fair value of investment property held by the Group was assessed by external valuation experts using comparison approach and income approach, or the fair value can be assessed based on the market price of the area adjacent to the location where the Group’s investment property is located.

B. Valuation techniques
(A)For financial instruments held for trading purposes which are classified as non-derivative instruments, their fair values are based on their quoted prices in an active market. If there is no quoted market price for reference, a valuation technique will be adopted to measure the fair value. Estimates and assumptions of valuation technique adopted by the Group are in agreement with the information of estimates and assumptions adopted by market users for financial instrument pricing and the said information shall be accessible to the Group. For those classified as derivative instruments, their fair values are based on their market prices if their quoted prices are available from an active market. If quoted market prices in an active market are not available, SWAP and IRS are valued at the discounted cash flow method, and options are valued at the Black-Scholes model.

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(B)When available-for-sale financial assets have quoted market prices available in an active market, the fair value is determined using the market price.
C. Fair value hierarchy of the financial instruments
(A)Definitions for the hierarchy classifications of financial instruments measured at fair value a. Level 1

Level 1, are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Group can access at the measurement date. An active market has to satisfy all the following conditions: 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. The Group’s investments in listed stocks, beneficiary certificates, on-the-run Taiwan central government bonds and derivative instruments with quoted market prices, are deemed as level 1.

b. Level 2

Inputs other than quoted market prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Investments of the Group such as emerging stock without active markets, off-the-run issue of government bonds, corporate bonds, bank debentures, convertible corporate bonds, currency swaps, interest rate swaps, options, asset swaps, and most derivatives are all classified within level 2. For the years ended December 31, 2021 and 2020, there was no significant transfer of financial instruments between Level 1 and Level 2.

c. Level 3

Unobservable inputs for the assets or liability. The fair value of the Group’s investment in equity investment without active market is included in Level 3. For the years ended December 31, 2021 and 2020, part of the unlisted stocks became the emerging stocks, therefore these stocks were transferred from Level 3 to Level 2.

(Blank below)

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(B)Hierarchy of fair value estimation of financial instruments

Financial instrument items measured at fair value Recurring fair value Non-derivative financial instruments Assets Financial assets at fair value through profit or loss-current Stock investments Bond investments Others Financial assets at fair value through other comprehensive income-current Stock investments Financial assets at fair value through profit or loss - non-current Stock investments Bond investments Others Financial assets at fair value through other comprehensive income- non-current Stock investments Liabilities Financial liabilities at fair value through profit or loss -current Derivative financial instruments Assets Financial assets at fair value through profit or loss- current Liabilities Financial liabilities at fair value through profit or loss - current		December	31,2021
	Total 14,416,332 $ 13,213,896 1,130,557 410,205 12,650 50,124 13,950 1,137,756 5,124,273 4,822,204 3,048,329	Level 1 14,309,899 $ 776,724 1,130,557 410,205 - - - - 5,124,273 4,807,480 2,624,397	Level 2 40,721 $ 12,437,172 - - - 50,124 - - - 14,724 423,932	Level3
				65,712 $ - - - 12,650 - 13,950 1,137,756 - - -

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Financial instrument items measured at fair value Recurring fair value Non-derivative financial instruments Assets Financial assets at fair value through profit or loss- current Stock investments Bond investments Others Financial assets at fair value through other comprehensive income- current Stock investments Financial assets at fair value through profit or loss - non-current Stock investments Bond investments Financial assets at fair value through other comprehensive income- non-current Stock investments Liabilities Financial liabilities at fair value through profit or loss -current Derivative financial instruments Assets Financial assets at fair value through profit or loss- current Liabilities Financial liabilities at fair value through profit or loss - current		December	31,2020
	Total 12,062,758 $ 23,302,082 2,451,233 353,510 16,991 50,493 707,616 1,039,794 3,795,649 1,584,625	Level 1 12,027,789 $ 1,170,822 2,451,233 353,510 - - - 1,039,794 3,786,276 1,433,197	Level 2 23,187 $ 22,131,260 - - - 50,493 - - 9,373 151,428	Level3
				11,782 $ - - - 16,991 - 707,616 - - -

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(C) The following table is the movement of financial assets at Level 3:

January1	Recorded in profit or loss Recorded in other comprehensive income(loss) Acquired/ Issued Transfers into level 3 685) ($ - $ 60,415 $ - $ 4,341) ( - - - 1,050) ( - 15,000 - - 430,140 - - Year ended December 31, 2020 Valuation amount Increased Year ended December 31,2021 Valuation amount Increased	Recorded in profit or loss Recorded in other comprehensive income(loss) Acquired/ Issued Transfers into level 3 685) ($ - $ 60,415 $ - $ 4,341) ( - - - 1,050) ( - 15,000 - - 430,140 - - Year ended December 31, 2020 Valuation amount Increased Year ended December 31,2021 Valuation amount Increased	Recorded in profit or loss Recorded in other comprehensive income(loss) Acquired/ Issued Transfers into level 3 685) ($ - $ 60,415 $ - $ 4,341) ( - - - 1,050) ( - 15,000 - - 430,140 - - Year ended December 31, 2020 Valuation amount Increased Year ended December 31,2021 Valuation amount Increased	Recorded in profit or loss Recorded in other comprehensive income(loss) Acquired/ Issued Transfers into level 3 685) ($ - $ 60,415 $ - $ 4,341) ( - - - 1,050) ( - 15,000 - - 430,140 - - Year ended December 31, 2020 Valuation amount Increased Year ended December 31,2021 Valuation amount Increased	Decreased	Decreased	December 31
			Acquired/ Issued	Transfers into level 3	Sold/ Disposed/ Settled	Transfers out from level 3
11,782 $ 16,991 - 707,616 January1 41,231 $ 21,180 591,596					3,300) ($ 2,500) ($ - - - - - - Decreased		65,712 $ 12,650 13,950 1,137,756 December 31
	Recorded in profit or loss	Recorded in other comprehensive income(loss)	Acquired/ Issued	Transfers into level 3	Sold/ Disposed/ Settled	Transfers out from level 3
	5,554) ($ 4,189) ( -	- $ - 116,020	2,500 $ - -	- $ - -	- $ - -	26,395) ($ - -	11,782 $ 16,991 707,616

355

(D) 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:

December 31,2021	Fair value	Valuation technique	Significant unobservable input	Range (weighted average)	Relationship of inputs to fair value
Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - non-current Venture capital shares Others Financial assets at fair value through other comprehensive income - non-current Unlisted stocks	12,650 13,950 65,712 $	Net asset value Net asset value Market approach	Price to earnings ratio multiple Discount for lack of marketability Latest transaction price Not applicable Not applicable	3.15 25% Not applicable Not applicable Not applicable	The higher the multiple, the higher fair value The higher the discount for lack of marketability, the lower the fair value Not applicable Not applicable Not applicable

				Price to		The higher the
				earnings ratio	1.80~2.27	multiple, the
				multiple		higher fair value
Unlisted	stocks	1,137,756	Market approach	Discount for		The higher the discount for lack
				lack of	6.24%~9.17%	of marketability,
				marketability		the lower the fair
						value

356

December 31,2020	Fair value	Valuation technique Significant unobservable input Price to earnings ratio multiple Discount for lack of marketability Net asset value Not applicable Market approach	Range (weighted average)	Relationship of inputs to fair value
Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - non-current Venture capital shares Financial assets at fair value through other comprehensive income - non-current Unlisted stocks	16,991 11,782 $		28.45 25% Not applicable	The higher the multiple, the higher fair value The higher the discount for lack of marketability, the lower the fair value Not applicable

				Price to		The higher the
				earnings ratio	1.46~1.90	multiple, the
				multiple		higher fair value
Unlisted	stocks	707,616	Market approach	Discount for		The higher the discount for lack
				lack of	6.99%~9.65%	of marketability,
				marketability		the lower the fair
						value

(E)Valuation process for fair value at Level 3

(F) For the fair value measurement of Level 3, the sensitivity analysis of the fair value to the reasonable alternative hypothesis shows that the fair value measurement of the financial assets by the Group is reasonable. However, use of different valuation models or assumptions may result in different measurement. The following is the impact to profit or loss or to other comprehensive income from financial assets and liabilities categorized within Level 3 if the inputs used in valuation models have changed up or down by 1%:

357

December 31,2021	Favourable change Unfavourable change 657 $ 657) ($ Not applicable Not applicable Not applicable Not applicable - - Recognised inprofit or loss Recognised inprofit or loss	Favourable change Unfavourable change 657 $ 657) ($ Not applicable Not applicable Not applicable Not applicable - - Recognised inprofit or loss Recognised inprofit or loss	Recognised in other comprehensive income	Recognised in other comprehensive income
			Favourable change	Unfavourable change
Financial assets at fair value through profit or loss - current Unlisted stocks Financial assets at fair value through profit or loss -non- current Venture capital shares Others Financial assets at fair value through other comprehensive income - non-current Unlisted stocks December 31,2020			- $ - $ - - - - 11,378 11,378) ( Recognised in other comprehensive income
	Favourable change	Unfavourable change	Favourable change	Unfavourable change
Financial assets at fair value through profit or loss - current Unlisted stocks Financial assets at fair value through profit or loss -non- current Venture capital shares Financial assets at fair value through other comprehensive income - non-current Unlisted stocks	118 $ Not applicable -	118) ($ Not applicable -	- $ - 7,076	- $ - 7,076) (

6) Capital management

A. Objective of capital management
(A) The represented capital adequacy ratio basically shall not be lower than 200% in compliance with the warning standard addressed in the “Rules Governing Securities Firms”.
(B) The Group includes all risks involved in the investment position as a part of risk management, such as market risk, credit risk, liquidity risk, operating risk, legal risk, and model risk and so on. Each risk management responsive unit should identify, evaluate, monitor and control various risks in order to enable the Group to defend impact from financial market, reflect the current operating strategies and make the investment portfolio applied to business planning and development.
B. Capital management policy and procedure

In order to secure the long-term and stable development of various businesses and effectively assume risks, the Group manages capital based on the business

358

development, related regulations and financial market environment. Major capital evaluation processes include:

(A) Each segment should provide accurate and valid source of information to maintain calculation accuracy of capital adequacy ratio.
(B) After the reporting at the 10th of each month, capital adequacy ratio should be computed by the end of every month. If the result is close to the legal standard, every unit will be called to attend a meeting for discussion and strategic planning to ensure that the basic objective of capital adequacy ratio is not less than 200%.
(C) Both the risk limits and economic capital of the Group should be agreed by the Board of Directors. The Group should quarterly report details of risk control with disclosure of investment condition in order to assess whether the risk position exceeds the limit and whether the investment direction is in line with the market trend. Within the authorized risk limits, the Group is actively engaged in development of various businesses and continually increases profit, creates company value, and complies with the capital management objective.

The Group calculates and reports the capital adequacy ratio according to “Rules Governing Securities Firms”. As of December 31, 2021 and 2020, the capital adequacy ratios were 379% and 339%, respectively, as required by the regulations.

7) Assets and liabilities of trust accounts

Pursuant to Article 17 of Enforcement Rules of the Trust Enterprise Act, balance sheet, income statement, and property list of trust accounts shall be disclosed in the consolidated financial statements on a semiannual basis.

A. Balance sheet of trust accounts

BALANCE SHEETS

Trust assets Bank savings Structured notes Stock Bond Repurchase bond Fund Accounts receivable Total of trust assets Trust liabilities Accounts payable Trust capital Net income Accumulated deficit Total of trust liabilities	December 31, 2021 $ 669,217 923,114 1,284,571 435,389 23,127 5,014,866 60,575 $8,410,859 December 31,2021 $ 2,130 6,945,206 1,753,062 (289,539) $ 8,410,859	December 31,2020
		$ 492,979 664,243 928,705 423,452 21,794 3,877,584 36,087
		$6,444,844
		December 31,2020
		$ 1,699 5,562,920 1,099,366 (219,141) $6,444,844

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B. Income statement of trust accounts

STATEMENTS OF INCOME

B. Income statement of trust accounts STATEMENTS OF INCOME	F INCOME
C. Property list of trust accounts Item Year ended December 31,2021 Trust income Interest income $ 44,486 Cash dividends received 61,237 Income from stock lending - Investment realised gains - bond 5,882 Investment realised gains - stock 6,967 Investment realised gains - fund 392,454 Investment realised gains - structured notes 5,699 Investment unrealised gains - bond 20,265 Investment unrealised gains - stock 671,271 Investment unrealised gains - fund 718,037 Investment unrealised gains - structured notes 1,996 Other income 2 Subtotal 1,928,296 Trust expenses Administrative expenses ( 1,255) Service fee ( 1,311) Borrowing costs - Investment realised losses - bond ( 1,393) Investment realised losses - stock ( 21) Investment realised losses - fund ( 34,002) Investment realised losses - structured notes ( 52) Investment unrealised losses - bond ( 14,706) Investment unrealised losses - stock ( 8,156) Investment unrealised losses - fund ( 87,619) Investment unrealised losses - structured notes (26,712) Income before income tax 1,753,069 Income tax benefit (excpense) (7) Net income $1,753,062 Items December 31,2021 Bank savings $ 669,217 Structured notes 923,114 Fund 5,014,866 Bond 435,389 Bonds under repurchase agreements 23,127 Stock 1,284,571 Others 60,575 Total $8,410,859 PROPERTY LIST OF TRUST ACCOUNTS	Year ended December 31,2021	Year ended December 31,2020
		$ 20,430 47,788 587 18,510 - 244,372 5,083 31,001 367,587 459,799 2,030 -
		1,197,187
		( 1,099) ( 526) ( 134) ( 318) - ( 42,212) - ( 7,317) ( 3,427) ( 40,634) (2,164) 1,099,356 10
		$1,099,366
		December 31,2020
	$ 669,217 923,114 5,014,866 435,389 23,127 1,284,571 60,575 $8,410,859	$ 492,979 664,243 3,877,584 423,452 21,794 928,705 36,087
		$6,444,844

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8) Status of the company in the limitations on financial ratios imposed by futures trading act, and the related implementation

The table below is prepared according to “Regulations Governing Futures Commission Merchants”.

==> picture [718 x 179] intentionally omitted <==

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

Article Calculation formula December 31, 2021 December 31, 2020 Standard Enforcement
Calculation Ratio Calculation Ratio
Stockholders’ equity 2,250,466 2,846,449 Met the
17 52.48 39.35 ≧ 1
(Total liability－futures trader’s equity) 42,881 72,340 requirement
Current assets 5,097,865 4,227,508 Met the
17 118.88 58.44 ≧ 1
Current liabilities 42,881 72,340 requirement
Stockholders’ equity 2,250,466 2,846,449 ≧ 60% Met the
22 562.62% 711.61%
Minimum paid-in capital 400,000 400,000 ≧ 40% requirement
Adjusted net capital 1,860,017 2,578,686 ≧ 20%
Met the
22 Total amount of customer margins required 292.78% 634.60%
635,292 406,350 ≧ 15% requirement
for the open positions of futures traders
----- End of picture text -----

9) Status of the subsidiary in the limitations on financial ratios imposed by the futures trading act and the related implementation

The table below is prepared according to “Regulations Governing Futures Commission Merchants”.

Article	Calculation formula	December 31,2021	December 31,2021	December 31,2020	December 31,2020	Standard	Enforcement
		Calculation	Ratio	Calculation	Ratio
17	Stockholders’ equity (Total liability－futures trader’s equity)	2,502,861 176,386	14.19	2,173,904 204,613	10.62	`≧`1	Met the requirement
17	Current assets Current liabilities	26,983,986 25,813,665	1.05	25,273,422 24,066,160	1.05	`≧`1	Met the requirement
22	Stockholders’ equity Minimumpaid-in capital	2,502,861 645,000	388.04%	2,173,904 645,000	337.04%	`≧`60% `≧`40%	Met the requirement
22	Adjusted net capital Total amount of customer margins required for the open positions of futures traders	2,187,401 4,151,688	52.69%	1,833,493 4,060,614	45.15%	`≧`20% `≧`15%	Met the requirement

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10) Prospective risk for futures trading

The main risk for futures merchants engaging in futures trading is credit risk, which could happen if the margin call cannot be made when it should have been made. While being consigned to conduct the futures trading, the Group pays attention to the individual margin account on a daily basis and request additional margin call or reduction in trading volume when necessary according to the condition of individual customer transactions in order to control the credit risk accordingly. The main risk faced by the Group while engaging in self-operating businesses is market price risk- that is risk of changes in market prices of futures or options contracts as a result of fluctuation in underlying investment index. Losses may occur if the market index price and underlying investment move adversely. However, the Group has set up stop-loss point to control such risk for reasons of risk management.

(Blank below)

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13. OTHER DISCLOSURE ITEMS

1) Information about significant transactions

A. Lending to others: Excluding security margin trading and conditional bond trading business, there is no lending of funds to either the shareholders or other parties.
B. Endorsements and guarantees for others ： None.
C. Acquisitions of real estate exceeding $300 million or 20 percent of contributed capital ： None.
D. Disposals of real estate exceeding $300 million or 20 percent of contributed capital ： None.
E. Purchases or sales transactions discount on brokers’ charges with related parties in excess of $5,000,000 ： None.
F. Receivables from related parties exceeding $100 million or 20 percent of contributed capital ： None.

G. Significant transactions between parent company and subsidiaries

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

Details of transactions
Percentage (%) of
total consolidated
Relationship net revenues or
No.(Note1) Company Counterparty (Note 2) Account Amount Conditions assets (Note 3)
0 President Securities Corp. President Futures Corp. 1 Futures Margin - Own Funds $ 4,353,971 Note 4 3.70%
0 President Securities Corp. President Futures Corp. 1 Deposit-out 34,000 Note 4 0.03%
0 President Securities Corp. President Futures Corp. 1 Accounts receivable 3,085 Note 4 0.00%
0 President Securities Corp. President Futures Corp. 1 Deposit-in 16,000 Note 4 0.01%
0 President Securities Corp. President Futures Corp. 1 Future commission revenue 42,884 Note 4 0.37%
0 President Securities Corp. President Futures Corp. 1 Clearing charges 14,089 Note 4 0.12%
0 President Securities Corp. President Futures Corp. 1 Other non-operating revenues 4,458 Note 4 0.04%
0 President Securities Corp. President Capital Management Corp. 1 Expense from investment advisory 50,400 Note 4 0.43%
0 President Securities Corp. President Capital Management Corp. 1 Other non-operating revenues 3,644 Note 4 0.03%
0 President Securities Corp. President Insurance Agency Corp. 1 Other non-operating revenues 1,125 Note 4 0.01%
----- End of picture text -----

Note 1 ： The numbers in the No. column are represented as follows:

The number zero is for parent company.
According to the sequential order, subsidiaries are numbered from 1.

Note 2 ： There are three kinds of transactions between related parties and numbered from 1 to 3 were shown as follows (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

363

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.)

Parent company to subsidiaries.
Subsidiaries to parent company.
Subsidiaries to subsidiaries.

Note 3 ： The calculation basis of the trading amount accounting for the total consolidated net revenues or assets is that the account ending balance is divided by the total consolidated assets if it is attributed to the balance sheet accounts, and the accumulated trading amount of the interim period is divided by the total consolidated net revenues if it is attributed to the profit or loss accounts.

Note 4 ： All the prices of the service revenues and consulting service provided between related parties were traded by contracts.

Note 5 ： Based on materiality, only the amounts of the transactions that were above $1 million would be shown in the table.

2) Related information of investee companies
A. Related information of investee companies

Name of the investor	Name of the investee company	Location	Date of registration	Reference number and the date of approval letter issued byFSC	Major operating activities	Balance on December 31,2021 Balance on December 31,2020 Original investment	Balance on December 31,2021 Balance on December 31,2020 Original investment	EndingBalance	EndingBalance	EndingBalance	Revenue of investee company	Net income (loss) of investee company	Investment income (loss) recognised by the Company	Cash dividends	Notes
								Shares	Percentage	Book vlaue
President Securities Corp.	President Futures Corp. President Capital Management Corp. President Securities (HK) Ltd. President Wealth Management (HK) Ltd.	Taipei Taipei Hong Kong Hong Kong	1994.03.01 1997.04.15 1994.07.26 2002.03.31	1994.03.01 Jing- Tou-Shen (83) Gong-Shang Letter No.1114 (Note 1) 1997.02.25 (86) Tai-Cai-Zheng (4) Letter No.17769 1993.11.4 (82) Tai- Cai-Zheng (2) Letter No.40913 2001.12.11 (90) Tai-Cai-Zheng (2) Letter No.166728	Futures brokerage and dealer Securities investment consulting Securities dealer, underwriting, brokerage and consulting Wealth management	644,650 $ 326,000 848,735 92,091	644,650 $ 326,000 848,735 92,091	63,817,303 30,000,000 192,600,000 23,400,000	96.69% 100.00% 100.00% 100.00%	2,420,110 $ 312,175 1,288,431 54,073	854,895 $ 88,621 75,964 -	119,086 $ 8,081) ( 27,343) ( 39) (	115,153 $ 8,074) ( 27,343) ( 39) (	144,227 $ - - -	Subsidiary of the Company Subsidiary of the Company Subsidiary of the Company Subsidiary of the Company

364

Original investment Ending Balance Reference number Net income Investment and the date of Major Balance on Balance on Revenue of (loss) of income (loss) Name of the Name of the Date of approval letter operating December December investee investee recognised by Cash investor investee company Location registration issued by FSC activities 31, 2021 31, 2020 Shares Percentage Book vlaue company company the Company dividends Notes President Securities Hong 1999.08.06 1997.10.27 (86) Nominee Service $ 3,403 $ 3,403 1,000,000 100.00% $ 1,529 $ - ($ 88) ($ 88) $ Subsidiary of(Nominee) Ltd. Kong Tai-Cai-Zheng (2) the Company Letter No.04840 Uni-President Taipei 1992.009.03 2000.07.19 (89) Investment Trust 667,622 667,622 14,904,630 42.46% 760,171 1,411,480 536,134 227,661 98,959 Associates Asset Management Tai-Cai-Zheng (2) Corp. Letter No.56407 President Insurance Taipei 2008.04.29 (Note2) Insurance Agent 10,000 10,000 1,000,000 100.00% 46,249 85,198 25,060 25,069 8,541 Subsidiary of Agency Corp. the Company PSC Venture Taipei 2013.10.29 2013.08.08 JingConsultation of 300,000 300,000 30,000,000 100.00% 273,064 42,717 30,924 30,925 Subsidiary ofCapital Investment Guan-Zheng-Chuan investment the Company Limited Company Letter management and No.1020028529 venture capital; other unprohibited or unrestricted businesses beyond the permit President Uni-President Taipei 1992.09.03 2000.07.19 (89) Investment Trust 478 478 12,000 0.03% 616 1,411,480 536,134 183 80 Associates Insurance Asset Management Tai-Cai-Zheng (2) Agency Corp. Corp. Letter No.56407

Note 1 ： As FSC was established in July, 2004, President Futures Corp. was approved by the Investment Commission, Ministry of Economic Affairs.

Note 2 ： When securities corporations invest in domestic business within FSC's limitation, there is no need to obtain the approval from FSC in advance, according to Tai-Cai-Zheng (2) Letter No.0930000005. Therefore, there was no reference numbers for President Insurance Agency Corp.

B. Lending to others: Excluding security margin trading and conditional bond trading business, there is no lending of funds to either the shareholders or other parties.
C. Endorsements and guarantees for others ： None.
D. Acquisitions of real estate exceeding $300 million or 20 percent of contributed capital ： None.
E. Disposals of real estate exceeding $300 million or 20 percent of contributed capital ： None.
F. Purchases or sales transactions discount on brokers’ charges with related parties in excess of $5,000,000 ： None.
G. Receivables from related parties exceeding $100 million or 20 percent of contributed capital ： None.
H. Accordance with Jing-Guan-Zheng-Chuang Letter No. 10300375782, the Company is required to disclose details of businesses run by foreign

365

enterprises that were incorporated in the countries identified as non-signatories to the IOSCO MMoU or have not obtained securities or futures license of signatories to the IOSCO MMoU:

a) Revenue from engagement in consultation on assets management business, service contents and litigation ： None

b) Balance sheets

PRESIDENT WEALTH MANAGEMENT (HK) LTD.

BALANCE SHEETS

DECEMBER 31, 2021 AND 2020

Assets	December 31,	2021	December 31,	2020	Liabilities and shareholders' equity	December 31,	Expressed in HK dollars December 31,2020 2021	Expressed in HK dollars December 31,2020 2021	Expressed in HK dollars December 31,2020 2021
	Amount	%	Amount	%		Amount	%	Amount	%
Currents assets Cash and cash equivalents Other receivables Total current assets Total assets	$ 15,252,550 4,028 15,256,578 $15,256,578	100 - 100 100	$ 15,254,818 12,553 15,267,371 $15,267,371	100 - 100 100	Current liabilities Other payables Total liabilities Shareholders' equity Share capital Retained earnings Accumulated deficit Total shareholders' equity Total liabilities and shareholders' equity	$20,400 20,400 23,400,000 (8,163,822) 15,236,178 $15,256,578	- - 154 (54) 100 100	$20,400 20,400 23,400,000 (8,153,029) 15,246,971 $15,267,371	- - 153 (53) 100 100

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PRESIDENT SECURITIES (NOMINEE) LTD. BALANCE SHEETS

DECEMBER 31, 2021 AND 2020

Assets Currents assets Cash and cash equivalents Other receivables Total current assets Total assets	Amount $ 447,719 - 447,719 $447,719 December 31,	% 2021	December 31,	2020	Liabilities and shareholders' equity Amount Current liabilities Other payables $16,800 Total liabilities 16,800 Shareholders' equity Share capital 1,000,000 Retained earnings Accumulated deficit (569,081) Total shareholders' equity 430,919 Total liabilities and shareholders' equity $447,719 December 31,	Expressed in HK dollars % Amount % 2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020	Expressed in HK dollars % Amount % 2021 December 31,2020
			Amount	%			Amount	%
		100 - 100 100	$ 472,052 6 472,058 $472,058	100 - 100 100		4 4 223 (127) 96 100	$16,800 16,800 1,000,000 (544,742) 455,258 $472,058	3 3 212 (115) 97 100

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c) Statements of comprehensive income

PRESIDENT WEALTH MANAGEMENT (HK) LTD. STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

Amount % 41,985) ($ 389 41,985) ( 389 31,191 ( 289) ( 10,794) 100 - - ($10,794) 100 December 31,2021	December 31,2020 Expressed in HK dollars	December 31,2020 Expressed in HK dollars
Amount 41,985) ($ 41,985) ( 31,191 ( 10,794) - ($10,794)	Amount ($41,435) ( 41,435) 136,625 95,190 - $ 95,190	%
		( 44) ( 44) 144
		100 - 100

PRESIDENT SECURITIES (NOMINEE) LTD. STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

Amount % ($24,710) 102 ( 24,710) 102 372 ( 2) ( 24,338) 100 - - ($24,338) 100 December 31,2021	December 31,2020 Expressed in HK dollars	December 31,2020 Expressed in HK dollars
Amount ($24,710) ( 24,710) 372 ( 24,338) - ($24,338)	Amount ($23,535) ( 23,535) 4,337 ( 19,198) - ($19,198)	%
		123
		123
		( 23) 100 - 100

d) Dealings with foreign businesses in related party transactions: None

368

3) Information of overseas branches and representative office: None

4) Disclosure of investment in Mainland China

A. Information of investment in Mainland China

==> picture [757 x 204] intentionally omitted <==

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

Accumulated Amount remitted from Taiwan to Accumulated Accumulated
Investment income
amount of Mainland China/ Amount remitted amount of Ownership Book value of amount of
Net income of (loss) recognized by
remittance from back to Taiwan for the years ended remittance from held by the investments in investment income
Taiwan to December 31, 2021 Taiwan to investee as of Company the Company for Mainland China as remitted back to
December 31, the year ended
Investee in Investment Mainland China Remitted to Mainland China as (direct or of December 31, Taiwan as of
2021 December 31, 2021
Mainland Main business Paid-in capital method as of January 1, Mainland Remitted back of December 31, indirect) 2021 December 31,
(Note 2)
China activities (Note 4) (Note 1) 2021 China to Taiwan 2021 2021
Jin Yuan Securities $ 5,212,800 Directly $ 2,481,388 $ - $ - $ 2,481,388 ($ 305,071) 49% ($ 149,485) $ 2,363,197 $ -
President brokering, securities invest in a
Securities dealing, securities company in The financial
Co.,Ltd. underwriting and Mainland statements that are
sponsoring service China audited by
international
accounting firm
which has
cooperative
relationship with
accounting firm in
R.O.C.
----- End of picture text -----

B. Limitation on investment in Mainland China (expressed in thousands of dollars)

Company name	Accumulated amount of remittance from Taiwan to Mainland China as of December 31, 2021	Investment amount approved by the Investment Commission of the Ministry of Economic Affairs (MOEA)	Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA
Jin Yuan President Securities Co.,Ltd.	2,481,388 $	2,481,388 $	19,059,978 $

Note 1: Investment methods are classified into the following three categories; fill in the number of category each case belongs to:

(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. (Please indicate investment company in the third area.)

369

(3) Others.

Note 2: In the ‘Investment income (loss) recognized by the Company for the years ended December 31, 2021’ column:

(1) It should be indicated if the investee was still in the incorporation arrangements and had not yet any profit during this period.
(2) Indicate the basis for investment income (loss) recognition in the number of one of the following three categories:.
a. The financial statements that are audited and attested by international accounting firm which has cooperative relationship with accounting firm in R.O.C.
b. The financial statements that are audited and attested by R.O.C. parent company's CPA.
c. Others.

Note 3: The numbers in this table are expressed in New Taiwan Dollars.

Note 4: The paid-in capital of Jin Yuan President Securities Co.,Ltd is CNY 1.2 billion.

5) Major shareholder information

Major shareholder Number of shares held (thousands) Shareholding ratio Uni-President Enterprises Corp. 417,517 28.67%

Note 1: The information of major shareholders in this table is based on the last business day of the end of each quarter by Taiwan Depository and Clearing Corp., which determines shareholders holding more than 5% of ordinary shares and special shares of securities firms that have completed unregistered delivery (including treasury shares). As for the share capital recorded in the financial report of the securities firm and the actual number of shares delivered by the securities firm without physical registration, there may be differences due to different calculation bases.
Note 2: In the case of the above information, if a shareholder delivers shares to the trust, it is disclosed in individual accounts by the trustee who opened the trust account by the trustee. As for the shareholders’ declaration of insider’s shareholding in accordance with the Securities and Exchange Act, their shareholding includes their own shareholding plus the shares delivered to the trust and the right to use the trust property. For information on insider’s equity declaration, please refer to the Market Observation Post System.

370

14. SEGMENTS INFORMATION

1) General information

Financial information by the Group’s segments is disclosed in accordance with IFRS 8. Management has determined the reportable operating segments based on the reports reviewed by the Chief Operating Decision-Maker (CODM) that are used to make strategic decisions. The Group’s operating segments are classified into Brokerage, Quantitative Trading, Proprietary Trading, Fixed Income and Reinvestment according to the sources of income. The remaining operating results which have not reached the threshold requirements are consolidated in ‘other operating segments’. Sources of income from products and services rendered by each segment are as follows:

A. Brokerage segment: consigned trading of the listed securities, margin trading and short sale, assistance in futures trading and other instruments trading as approved by the regulations.
B. Quantitative Trading segment: trading of domestic/overseas futures and options, ETF arbitrage, market maker, liquidity provider, hedging, spot/futures arbitrage as approved by Law.
C. Proprietary Trading segment: using the self-owned equity to conduct securities trading such as stocks and bonds trading, and futures and options hedging in Stock Exchange and OTC.
D. Financial product segment: Call (put) warrants (including negotiated warrants) and Callable Bull/Bear Contracts (CBBC) issuance, Structured Notes Trading, equity derivative trading, and Exchange Traded Note (ETN) and other derivative financial products approved by the competent authority.
E. Reinvestment segment: companies reinvested by the consolidated entities.
F. Other operating segments include Capital Market segment, Fixed Income segment, and Shareholder Services segment.
2) Segments information

The accounting policies applied to the Group’s operating segments and summary of accounting policies disclosed in the notes to the financial statements are consistent and identical. The operating gains and losses are measured by the amount before tax and used as basis for performance appraisal. Income and expense attributable to each operating segment are attributed to the segmental gains and losses. Non-attributable indirect expenses and expenses from logistic support segment are amortized to each operating segment based on reasonable calculation standards and the expense nature. Those that cannot be reasonably amortized are listed under “Others”

371

3) Profit or loss, Assets and Liabilities of segments information

			Year ended December 31,2021	Year ended December 31,2021
Brokerage segment	Quantitative Tradingsegment	Proprietary Tradingsegment	Financial instrument segment	Reinvestment segment	Other operating segments Others 643,703 $ 232,564) ($ 268,608 $ 493,432) ($	Total
5,516,206 $ 1,985,946 $	753,836 $ 221,416 $	2,528,807 $ 1,975,793 $	1,259,777 $ 1,151,854 $ 538,865 $ 172,239 $ Year ended December 31,2020			11,621,619 $
						4,669,435 $

Brokerage segment	Quantitative Tradingsegment	Proprietary Tradingsegment	Financial instrument segment	Reinvestment segment	Other operating segments Others 1,883,253 $ 185,889) ($ 1,291,776 $ 911,910) ($	Total
3,188,195 $ 776,046 $	1,053,299 $ 535,516 $	1,816,970 $ 1,227,947 $	613,902 $ 185,504 $	1,211,542 $ 877,943 $		9,581,272 $
						3,982,822 $

Note 1: As operating income (loss) in total is consistent with consolidated statement of comprehensive income, there is no need for adjustment.

Note 2: The Company measures the performance of reportable operating segment based on specific performance indicators instead of assets and liabilities. The performance of reportable operating segment is regularly reviewed and assessed by the CODM as a reference for making resources allocation decision.

4) Information on products and services

The Group’s segments are based on different products and services, and had disclosed in general information. It disclosures the types of products and services of the Group’s segments 's source of income. There is no additional disclosure requirement on the income information of products and services. 5) Geographical information

The Group's external customer income from a single foreign country is immaterial, so it would not be disclosed. 6) Major customer information

The Group did not have any significant customers that account for more than 10% of its revenue, so it would not be disclosed.

372

AI assistant

PSC — Annual Report 2021

52209_rns_2022-07-06_ffd1d3d5-4b19-4c03-9969-035c3890f141.pdf

2021 ANNUAL REPORT

Notice to readers

I. A Letter to Shareholders

Dear Shareholders,

II. Company Profile

Incorporated

III. Corporate Governance

III. Corporate Governance

I. Business Organization

A. Organizational Chart

B. Function of Each Division

II. Directors’, Supervisors’ and Managers’ Information

A. Directors

1. Information Regarding Directors

3. Professional qualifications and independence analysis of directors

1.Not an employee of the Company or any of its affiliates.

(2) Diversity and independence of the Boardof the Board:

 Diversity of the Board:

 Independence of the Board:

B. Information regarding directors, supervisors, management team and branch manager

C. Remuneration of Directors, Supervisors, President, Vice Presidents, and Chief Auditor

1. Remuneration of Directors

1.1 Remuneration of Directors (disclosing the name of each individual )

1.2 Remuneration of Directors (Independent Directors Included)

2. Remuneration of the President, Vice Presidents, and Chief Auditor

III. Corporate Governance

3. Procedures for determining remuneration:

III. Corporate Governance

E. President’s, senior vice presidents’ and senior managers’ remuneration

III. Corporate Governance

III. Implementation of Corporate Governance

A. Board of Directors Meeting

III. Corporate Governance

Other mentionable items:

B. Evaluation of the Board of Directors

C. Operations of the Audit Committee: Number of Meetings, Actual Attendance Rate of each Independent Director, and other mentionable items

Other mentionable items:

III. Corporate Governance

III. Corporate Governance

D. Corporate Governance Implementation Status and Deviations from “the Corporate Governance Best -Practice Principles for TWSE/TPEx Listed Companies”

III. Corporate Governance

III. Corporate Governance

III. Corporate Governance

III. Corporate Governance

VII. Information Disclosure

B. Investor relations

Implementation Status Evaluation Item Yes No Abstract Illustration

C. Employee rights and wellness

D. Rights of the stakeholders

F. Directors training

III. Corporate Governance

III. Corporate Governance

E. Composition, responsibilities, and operation of the Remuneration Committee

III. Corporate Governance

1. Information Regarding Remuneration Committee

2. Operations of the Remuneration Committee

(3) 2021 remuneration committee proposal discussion and resolution:

III. Corporate Governance

F. Sustainable development and Deviations from “ Sustainable Development Best Practice Principles for TWSE/GTSM Listed Companies ”

III. Corporate Governance

III. Corporate Governance

III. Corporate Governance

III. Corporate Governance

G. Ethical business operation at the Company and related implementation and Deviations from “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”

1. Ethical business operation

III. Corporate Governance

2. Ethical Corporate Management:

III. Corporate Governance

H. Corporate Governance Guidelines and Regulations

I. Other Important Information Regarding Corporate Governance

J. Internal Control Systems:

1. Internal Control Declaration:

Internal control declaration

Implementation of the internal control system of President Securities Corporation

III. Corporate Governance

President Securities Corporation Internal Control System Findings and Remediation Action Plans

III. Corporate Governance

PSC Annual Report 2021