RECTRON - Annual Report 2024 | FinancialReports.eu

Stock Code：2302

Rectron Ltd.

Parent Company Only Financial Statements

With Independent Auditors’ Report For the Years Ended December 31, 2024 and 2023

Address: No. 71, Zhongshan Rd., Tucheng Dist., New Taipei City, Taiwan Telephone: 886-2-28801122

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

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Contents 1. Cover Page 2. Table of Contents 3. Independent Auditors’ Report 4. Balance Sheets 5. Statement of Comprehensive Income 6. Statement of Changes in Equity 7. Statement of Cash Flows 8. Notes to the Parent Company Only Financial Statements (1) Company history (2)Approval date and procedures of the Financial Statements (3) New standards, amendments and interpretations adopted (4)Summary of significant accounting policies (5)Significant accounting assumptions and judgments, and major sources of estimation uncertainty (6) Explanation of significant accounts (7) Related-party transactions (8)Assets pledged as security (9) Commitments and contingencies (10)Losses due to major disasters (11)Subsequent events (12)Other (13)Other disclosures  Information on significant transactions  Information on investees  Information on investment in Mainland China  Major shareholders (14)Segment information 9.Appendix	Page
	1 2 3 4 5 6 7 8 8 8~9 10~19 19~20 21~43 43~46 46 46 46 46 47~48 48~49 50 50 51 51 52~57

Contents
1. Cover Page
2. Table of Contents
3. Independent Auditors’ Report
4. Balance Sheets
5. Statement of Comprehensive Income
6. Statement of Changes in Equity
7. Statement of Cash Flows
8. Notes to the Parent Company Only Financial Statements
(1) Company history
(2)Approval date and procedures of the Financial Statements
(3) New standards, amendments and interpretations adopted
(4)Summary of significant accounting policies
(5)Significant accounting assumptions and judgments, and major sources of
estimation uncertainty
(6) Explanation of significant accounts
(7) Related-party transactions
(8)Assets pledged as security
(9) Commitments and contingencies
(10)Losses due to major disasters
(11)Subsequent events
(12)Other
(13)Other disclosures
 Information on significant transactions
 Information on investees
 Information on investment in Mainland China
 Major shareholders
(14)Segment information
9.Appendix

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10~19
19~20
21~43
43~46
46
46
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47~48
48~49
50
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51
51
52~57

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Independent Auditors’ Report

To the Board of Directors of RECTRON LTD. Company ：

Opinion

We have audited the consolidated financial statements of RECTRON LTD (“the Company”), which comprise the statement of balance sheets as of December 31,2023 and 2024, the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the financial statements, including a summary of material accounting policies.

In our opinion, based on our audits and the reports of other auditors (please refer to Other Matter paragraph), the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2024, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers..

Basis of Audit Opinion

We, as auditors, have conducted our audit work in accordance with the Regulations Governing the Audit Signatures of Certified Public Accountants and the Auditing Standards. Our CPA s responsibility under these standards will be further explained in the paragraph of responsibility of the accountant for examining the financial statements. The personnel of our accounting firm, who are subject to independence regulations, have maintained independence in accordance with the Code of Ethics for Professional Accountants and fulfilled other responsibilities prescribed by the regulations. They have maintained a professional and objective stance in relation to Rectron LTD. and its subsidiaries. We believe that we have obtained adequate and appropriate audit evidence to form the basis of our audit opinion.

Key audit matters

The key audit matters refer to those matters that, in the auditor's professional judgment, are of most significance in the audit of the financial statements of Rectron Ltd. for the year ended 2024. Such items have been taken into consideration in the process of auditing the overall financial reports and forming audit opinions. The accountant does not express opinions on such items separately. Our CPA determined to address the following key auditing matters in the accountant’s report:

Revenue Recognition
Please refer to Note 4 (m) of the financial statements for details on the accounting policy for revenue recognition. Additionally, refer to Note 6 (o) of the financial statements for a breakdown of revenue by customer contracts.
Key Audit Matters

Rectron LTD. primarily derives its revenue from the manufacturing and sale of various rectifiers and other semiconductor components. The risk lies in the accuracy of revenue recognition. The company's viability and ongoing operations depend on a consistent inflow of cash generated from revenue. Therefore, the company's business strategy and operational management start with revenue. Consequently, testing revenue recognition is one of the key assessment areas for auditors in conducting the financial statement audit of Rectron LTD.

Auditing procedures performed:

The main audit procedures performed by the auditor for the above-mentioned key audit matters include testing the controls and effectiveness of the sales and cash collection cycle, as well as sampling the accuracy of recognizing sales revenue around the balance sheet date, which involves verifying warehouse

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dispatch records and comparing contractual terms. The auditor also evaluates whether control over the goods has been transferred at the appropriate recognition point.

Inventory valuation
Regarding inventory valuation, please refer to Note 4 (g) "Inventory" for the accounting policy. For the accounting estimates and assumptions related to inventory valuation and their uncertainties, please refer to Note 5 (b). Further explanation on the assessment of inventory valuation can be found in Note 6 (d) "Inventory" of the financial statements.
Key Audit Matters

The valuation of inventory for Rectron Ltd. is subject to the risk of cost exceeding its net realizable value due to fluctuations in international raw material prices and market supply and demand conditions, which may result in significant fluctuations in product selling prices and sales volumes. Therefore, the testing of inventory valuation is considered as one of the important assessment matters in the auditor's examination of Rectron Ltd.'s financial statements.

Auditing procedures performed:

The main audit procedures performed by the auditor for the above-mentioned key audit matters include reviewing the inventory aging report, analyzing the changes in inventory aging over different periods, assessing the reasonableness of Rectron Ltd.'s accounting policies and their implementation, conducting trend analysis on the treatment of obsolete inventory, understanding the basis and methods of inventory valuation, and comparing relevant variances to identify any significant abnormalities.

Other Matters

We did not audit the financial statements of certain investees, which represented investments in other entities accounted for using the equity method of the Company. Those statements were audited by other auditors, whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for those investees, is based solely on the reports of other auditors. The investments in those investees accounted for using the equity method constituting 5% and 7% of total assets at December 31, 2024 and 2023, respectively, and the related share of profit of subsidiaries, associates and joint ventures accounted for using the equity method constituting (10)% and (6)% of total profit before tax for the years then ended respectively.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

The management is responsible for the preparation of the appropriate financial statements, which are in accordance with the Financial Reporting Standards for Issuers of Securities and approved and issued by the Financial Supervisory Commission, as well as the applicable International Financial Reporting Standards, International Accounting Standards, Interpretations, and Interpretive Bulletins. They are also responsible for maintaining necessary internal controls related to the preparation of the financial statements to ensure that they are free from material misstatement caused by fraud or error.

In preparing the financial statements, the management's responsibility also includes assessing the ability of the Rectron Ltd. to continue as a going concern, making relevant disclosures, and adopting the going concern basis of accounting unless there are intentions to liquidate the Rectron Ltd. or cease its operations, or unless there are no other practical alternative courses of action other than liquidation or cessation.

The governance body of Rectron Ltd., including the Audit Committee, has the responsibility to oversee the financial reporting process.

Auditor’s Responsibilities for the Audit of the Non-Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’ s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an

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audit conducted in accordance with the Standards on Auditing of 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 financial statements.

As part of an audit in accordance with the Standards on Auditing of the Republic of China, we exercise professional judgment and professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and performed audit procedures responsive to those risks, and obtained 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 Rectron LTD. 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 Rectron LTD. ability to continue as a going concern. If we determine that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the 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 auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the 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 Company to express an opinion on Rectron Ltd. 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.

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 financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s 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.

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The engagement partners on the audit resulting in this independent auditors’ report are Shih-Chin Chih and Hsin-Ting Huang.

KPMG

Taipei, Taiwan (Republic of China) March 11, 2025

Notes to Readers

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

The independent Auditors’ Report and the accompanying Parent Company Only Financial Statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent Auditors’ Report and Parent Company Only Financial Statements, the Chinese version shall prevail.

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(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese.)

Rectron LTD.

Balance Sheets

December 31,2024 and 2023 (Expressed in Thousands of New Taiwan Dollar)


Assets Current assets: 1100 Cash and cash equivalents (note 6(a)) 1170 Trade receivables net (note 6(c), and (o)) 1180 Accounts receivable due from related parties, net (Notes 6(o) and 7) 1200 Other receivables 1210 Other receivables due from related parties, net (Notes 6(e) and 7) 130X Inventories (note 6(d)) 1410 Prepayments(Notes 7) 1479 Other current assets Non-current assets: 1517 Non-current financial assets at fair value through other comprehensive income (note 6(b)) 1550 Investments accounted for using equity method (Note 6(e)) 1600 Property, plant and equipment (note 6(f) 7,8 and 9) 1755 Right-of-use assets (note 6(g)) 1760 Investment property (note 6(h) , 7 and 8) 1990 Other non-current assets Total assets		December 31,	2024 % 2 5 1 - 17 2 - - 27 3 12 13 - 45 - 73 100		December 31, 2023
	$	Amount 39,4425 104,2366 17,062 478 333,355 47,250 593 1,498 543,9147 55,867 238,691 259,483 2,441 899,536 1,505 1,457,523 2,001,437		$	Amount 67,998 54,575 4,660 1,060 248 58,297 414 1,7308 188,9827 57,636 561,628 272,362 275 904,974 2,315 1,799,190 1,988,172	% 3 3 - - - 3 - - 9 3 28 14 - 46 - 91


						100

December 31, 2024 December 31, 2023 Amount % Amount % Liabilities and Equity Current liabilities: 2100 Short-term borrowings (note 6(i)) - - 15,000 1 2170 Trade payables 45,912 2 21,154 1 2180 Accounts payable to related parties (Note 7) 9,663 - 77,716 4 2200 Other payables 25,307 1 20,668 1 2220 Other payables to related parties (Note 7) 55 - 238 - 2230 Current tax liabilities 15,665 1 6,580 - 2280 Current lease liabilities 896 - 71 - 2300 Other current liabilities(Note 7) 925 - 1,298 - 98,423 4 142,725 7 Non-current liabilities 2640 Net defined benefit liability, non-current (note 6(k)) 84 - 2,209 - 2570 Deferred tax liabilities(note 6(l)) 62,679 3 62,679 3- 2580 Non-current lease liabilities 1,562 - 206 - 2600 Other non-current liabilities (note 7 ) 4,653 - 4,756 - 68,978 3 69,850 3 Total liabilities 167,401 7 212,575 10 Equity (notes 6(m)): 3110 Ordinary shares 1,663,029 84 1,663,029 84 3200 Capital surplus 9 - 9 - 3310 Legal reserve 60,655 3 51,988 3 3320 Special reserve 87,143 5 60,07 3 3351 Retained earnings 126,496 6 87,640 4 3400 Other equity (103,296) (5) (87,14 (4) Total equity 1,834,036 93 1,775,59 90 Total liabilities and equity $ 2,001,437 100 1,988,17 100	December 31, 2023	December 31, 2023
		Amount % 15,000 1 21,154 1 77,716 4 20,668 1 238 - 6,580 - 71 - 1,298 - 142,725 7 2,209 - 62,679 3- 206 - 4,756 - 69,850 3 212,575 10 1,663,029 84 9 - 51,988 3 60,07 3 87,640 4 (87,14 (4) 1,775,59 90 1,988,17 100

See accompanying notes to financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese.)

Rectron LTD.

Statement of Comprehensive Income

For the Years Ended December 31, 2024 and 2023 (Expressed in Thousands of New Taiwan Dollar, except for Earnings per Common Share)

4000 Operating revenue(notes 6(o)and 7) 5000 Operating costs (notes 6(d)`、`6(k)and 7) Gross profit from operations 5910 Loss: Unrealized profit (loss) from sales 5920 Add: Realized profit (loss) on from sales Operating expenses (notes6(k)`、`6(p)and 7): 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses 6450 Impairment loss determined in accordance with IFRS 9 Total operating expenses Net operating income Non-operating income and expenses(notes 6(q)and 7): 7010 Other income 7020 Other gains and losses 7050 Finance costs 7070 Share of profit of subsidiaries, associates and joint ventures accounted for using equity method, net 7950 Total non-operating income and expenses Profit before tax Total tax expense (note 6(l)) Profit 8300 Other comprehensive income (loss): 8310 Components of other comprehensive income that will not be reclassified to profit or loss: 8311 Gains (losses) on remeasurements of defined benefit plans 8316 Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 8360 Components of other comprehensive income (loss) that will be reclassified to profit or loss: 8367 Unrealized gains (losses) from investments in debt instruments measured at fair value through other comprehensive income 8380 Share of other comprehensive income of subsidiaries for using equity method, components of other comprehensive income that will be reclassified to profit or loss Total components of other comprehensive income that will be reclassified to profit or loss 8300 Other comprehensive income, net Comprehensive income Earnings per common share (expressed in dollars) (note 6(n)) 9750 Basic earnings per share $ 9810 Diluted earnings per share $		For the three months ended 2024 % $ 628,471 100 447,833 71 180,638 29 1,529 - (901) - 178,208 29 138,527 3 50,569 8 263 - 30 - 69,389 11 108,819 18 5,751 1 12,603 2 (243) - 22,683 4 40,794 7 149,613 25 24,082 4 125,531 21 615 - 1,639 - 2,254 - (2,640) - (15,152) (2) (17,792) (2) (15,538) (2) $ 109,993 19 0.75 0.75	For the three months ended 2024 % $ 628,471 100 447,833 71 180,638 29 1,529 - (901) - 178,208 29 138,527 3 50,569 8 263 - 30 - 69,389 11 108,819 18 5,751 1 12,603 2 (243) - 22,683 4 40,794 7 149,613 25 24,082 4 125,531 21 615 - 1,639 - 2,254 - (2,640) - (15,152) (2) (17,792) (2) (15,538) (2) $ 109,993 19 0.75 0.75	For the three months ended 2024 % $ 628,471 100 447,833 71 180,638 29 1,529 - (901) - 178,208 29 138,527 3 50,569 8 263 - 30 - 69,389 11 108,819 18 5,751 1 12,603 2 (243) - 22,683 4 40,794 7 149,613 25 24,082 4 125,531 21 615 - 1,639 - 2,254 - (2,640) - (15,152) (2) (17,792) (2) (15,538) (2) $ 109,993 19 0.75 0.75	For the three months ended 2024 % $ 628,471 100 447,833 71 180,638 29 1,529 - (901) - 178,208 29 138,527 3 50,569 8 263 - 30 - 69,389 11 108,819 18 5,751 1 12,603 2 (243) - 22,683 4 40,794 7 149,613 25 24,082 4 125,531 21 615 - 1,639 - 2,254 - (2,640) - (15,152) (2) (17,792) (2) (15,538) (2) $ 109,993 19 0.75 0.75	March 31 2023 % 548,781 100 412,849 75 141,420 25 (901) - (58) - 136,775 25 13,203 2 47,400 9 1,001 - 27 - 61,631 11 75,144 14 4,791 1 4,434 1 (576) - 20,963 4 29,612 6 104,756 20 17,887 3 86,869 17 (201) - (454) - (655) - 1,336 - (14,105) (5) (26,615) (5) (27,270) (5) 59,599 23 0.52	March 31 2023 % 548,781 100 412,849 75 141,420 25 (901) - (58) - 136,775 25 13,203 2 47,400 9 1,001 - 27 - 61,631 11 75,144 14 4,791 1 4,434 1 (576) - 20,963 4 29,612 6 104,756 20 17,887 3 86,869 17 (201) - (454) - (655) - 1,336 - (14,105) (5) (26,615) (5) (27,270) (5) 59,599 23 0.52





							14 1 1 - 4 6 20 3 17 - - - - (5)







							(5) (5) 23


							0.52
							0.52

See accompanying notes to financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese.)

Rectron LTD.

Statement of Changes in Equity

For the Years Ended December 31, 2024 and 2023 (Expressed in Thousands of New Taiwan Dollar)

				Attributable to owners ofparent	Attributable to owners ofparent	Attributable to owners ofparent	Attributable to owners ofparent	Total	Total equity
	Ordinary share	Capital surplus		Retained earnings	Total	Other equity
			Legal reserve	Special reserve		Exchange differences on translation of foreign financial statements Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income (55,153) (4,921) - - (27,951) 882 (27,951) 882 - - (83,104) (4,039) - - (15,152) (1,001) (15,152) (1,001) - - (98,256) (5,040)
$1,663,029 - - - - $ 1,663,029 - - - - $ 1,663,029		9 - - - - 9 - - - - 9	34,364 - - - 17,624 - 51,988 - - - 8,667 - 60,655	34,924 - - - 25,150 - 60,074 - - - 27,069 - 87,143	176,788 86,869 (201)- 86,668 (17,624) (25,150) (133,042) 87,640 125,531 615 126,146 (8,667) (270,69) (51,554) 126,496	(55,153) - (27,951) (27,951) - (83,104) - (15,152) (15,152) - (98,256)		(60,074) - (27,069) (27,069) - (87,143) - (16,153) (16,153) - (103,296)	1,849,040 86,869 (27,270) 59,599 (133,042) 1,775,597 125,531 (15,538) 109,993 (51,554) 1,834,036




$							-

See accompanying notes to financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese.)

Rectron LTD.

Statement of Cash Flows

For the Years Ended December 31, 2024 and 2023 (Expressed in Thousands of New Taiwan Dollars)

For the Years Ended	For the Years Ended	For the Years Ended	December 31,	December 31,	December 31,
	2024		2023
$		149,613 17,885 2,138 30 243 (4,382) (455) (22,683) 1,529 901 (753) (37) (1,662) 6,130 (1,116) (49,691) (12,402) 582 (3,407) 11,047 (179) 232 (53,818) - 24,758 (68,053) 4,639 (183) (373) (1,510) (40,722) (94,540) (95,656) 53,957 2,640 (182) (14,997) 41,418 - 3,259 (5,350) - (1,328) 455 (2,964) 18,000 (33,000) (103) (353) (51,554) (67,010) (28,556) 67,998 39,442	104,756 18,237 2,542 27 576 (3,391) (303) (20,963) (901) 58 2,233 - (1,673) 75
$			(3,483)
			53,679 9,698 1,005 (40) (17,491) 236 (142)
			46,945
			(682) (19,041) 27,853 1,633 87 32 (1,501)
				8,381
				55,326
			51,843 156,599 1,611 (576) (31,383)	51,843

			126,251
			(3,176) - (4,711) 4,888 420 3,303 724
					724
			50,000 (65,000) 767 (280) (33,042)
			(147,555)
			(20,580) 88,578
			67,998

See accompanying notes to financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese.)

Rectron Ltd.

Notes to the Financial Statements

December 31, 2024 and 2023

(Expressed in Thousands of New Taiwan Dollar, except for Earnings per Share Information and Unless Otherwise Specified)

1. Company history

Rectron Ltd. (the “Company”) was established and approved by the Ministry of Economic Affairs on January 23, 1976. The registered address is No. 71, Zhongshan Road, Tucheng District, New Taipei City. The Company was originally named "Rectron Precision Electronics Industry Co., Ltd." and changed its name to "Rectron Ltd." on June 29, 2000, as resolved by the shareholders' meeting and approved by the Ministry of Economic Affairs.

The Company and its subsidiaries (together referred to as the “Group”)main business operations include the manufacture and sale of various rectifiers, other semiconductor components, rental and sale of real estate, trading of wines, and manufacture and sale of medical equipment.

2. Approval date and procedures of the Parent Company Only Financial Statements

The accompanying non-consolidated financial statements were authorized for issue by the Board of Directors on March 11, 2025.

3. New standards and interpretations not yet adopted

(a) The impact of the International Financial Reporting Standards (“IFRSs”) endorsed by the Financial Supervisory Commission, R.O.C. which have already been adopted.
The Company has initially adopted the (following) new amendments, which do not have a significant impact on its consolidated financial statements, from January 1, 2024 ：
Amendments to IAS 1 “Classification of Liabilities as Current or Non-current”
Amendments to IAS 1 “Non-current Liabilities with Covenants”
Amendments to IAS 7 and IFRS 7 “Supplier Finance Arrangements”
Amendments to IFRS 16 “Lease Liability in a Sale and Leaseback”
(b) The impact of IFRS issued by IASB but not yet endorsed by the FSC
The following new and amended standards, which may be relevant to the Company, have been issued by the International Accounting Standards Board (IASB), but have yet to be endorsed by the FSC:

See accompanying notes to financial statements.

		9
Standards or Interpretations IFRS 18 “Presentation and Disclosure in Financial Statements”	Content of amendment The new standard introduces three categories of income and expenses, two income statement subtotals and one single note on management performance measures. The three amendments, combined with enhanced guidance on how to disaggregate information, set the stage for better and more consistent information for users, and will affect all the entities.  A more structured income statement: under current standards, companies use different formats to present their results, making it difficult for investors to compare financial performance across companies. The new standard promotes a more structured income statement, introducing a newly defined ‘operating profit’ subtotal and a requirement for all income and expenses to be allocated between three new distinct categories based on a company’s main business activities.  Management performance measures (MPMs): the new standard introduces a definition for management performance measures, and requires companies to explain in a single note to the financial statements why the measure provides useful information, how it is calculated and reconcile it to an amount determined under IFRS Accounting Standards.  Greater disaggregation of information: the new standard includes enhanced guidance on how companies group information in the financial statements. This includes guidance on whether information is included in the primary financial statements or is further disaggregated in the notes.	Effective date per IASB
		January 1, 2027

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

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

Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets Between an Investor and Its
Associate or Joint Venture”
IFRS 17 “Insurance Contracts” and amendments to IFRS 17 “ Insurance Contracts”
IFRS 19 “Subsidiaries without Public Accountability: Disclosures”
Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments”
Annual Improvements to IFRS Accounting Standards
The Amendments to IFRS 9 and IFRS 7 “ Contracts for Renewable Electricity”

See accompanying notes to financial statements.

4. Summary of significant accounting policies

The significant accounting policies presented in the financial statements are summarized below. Except for those specifically indicated, the following accounting policies were applied consistently throughout the periods presented in the financial statements.

(a) Statement of compliance

The non-consolidated financial statements are prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

(b) Basis of consolidation

i. Basis of measurement
The non-consolidated financial statements have been prepared on the historical cost basis except for the following material items in the balance sheets:
1) Financial instruments measured at fair value through profit or loss are measured at fair value;
2) Financial assets at fair value through other comprehensive income are measured at fair value;
3) The net defined benefit liability is recognized as the present value of the defined benefit obligation less the fair value of plan assets.
ii. Functional and presentation currency

The functional currency of each Company entities is determined based on the primary economic environment in which the entities operate. The non-consolidated financial statements are presented in New Taiwan Dollar, which is the Company’s functional currency. All financial information presented in New Taiwan Dollar has been rounded to the nearest thousand.

(a) Foreign currency
Foreign currency transactions

Transactions in foreign currencies are translated into the respective functional currencies of Group entities at the exchange rates at the dates of the transactions. At the end of each subsequent reporting period, monetary items denominated in foreign currencies are translated into the functional currencies using the exchange rate at that date. Non-monetary items denominated in foreign currencies that are measured at fair value are translated into the functional currencies using the exchange rate at the date that the fair value was determined. Non-monetary items denominated in foreign currencies that are measured based on historical cost are translated using the exchange rate at the date of the transaction.

Exchange differences are generally recognized in profit or loss, except for those differences relating to the following, which are recognized in other comprehensive income:

(i) an investment in equity securities designated as at fair value through other comprehensive income;
(ii) a financial liability designated as a hedge of the net investment in a foreign operation to the extent that the hedge is effective; or

(iii) qualifying cash flow hedges to the extent that the hedges are effective.

Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into the presentation currency at the exchange rates at the reporting date. The income and expenses of foreign operations are translated into the presentation currency at the average exchange rate. Exchange differences are recognized in other comprehensive income.

When a foreign operation is disposed of such that control, significant influence, or joint control is lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the gain or loss on disposal. When the Company disposes of only part of its interest in a subsidiary that includes a foreign operation while retaining control, the relevant proportion of the cumulative amount is

See accompanying notes to financial statements.

reattributed to non-controlling interests. When the Company disposes of only part of its investment in an associate or joint venture that includes a foreign operation while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.

When the settlement of a monetary receivable from or payable to a foreign operation is neither planned nor likely to occur in the foreseeable future, Exchange differences arising from such a monetary item that are considered to form part of the net investment in the foreign operation are recognized in other comprehensive income.

(d) Classification of current and non-current assets and liabilities
An asset is classified as current under one of the following criteria, and all other assets are classified as non-current.
It is expected to be realized, or intended to be sold or consumed, in the normal operating cycle;
It is held primarily for the purpose of trading;
It is expected to be realized within twelve months after the reporting period; or
The asset is cash or a cash equivalent (as defined in IAS 7) unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

A liability is classified as current under one of the following criteria, and all other liabilities are classified as non-current.

An entity shall classify a liability as current when:

It is expected to be settled in the normal operating cycle;
It is held primarily for the purpose of trading;
It is due to be settled within twelve months after the reporting period; or
The Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by issuing equity instruments do not affect its classification.
(e) Cash and cash equivalents

Cash comprises cash on hand and demand deposits. Cash equivalents are short term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. Time deposits which meet the above definition and are held for the purpose of meeting short term cash commitments rather than for investment or other purposes should be recognized as cash equivalents.

(f) Financial instruments

Trade receivables and debt securities issued are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Company becomes a party to the contractual provisions of the instrument. A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured at fair value plus, for an item not at fair value through profit or loss (FVTPL), transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price.

(1) Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. On initial recognition, a financial asset is classified as measured at: amortized cost; Fair value through other comprehensive income (FVOCI) – debt investment; FVOCI – equity investment; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model.

(i) Financial assets measured at amortized cost
A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:
- it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
- its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

See accompanying notes to financial statements.

These assets are subsequently measured at amortized cost, which is the amount at which the financial asset is measured at initial recognition, plus/minus, the cumulative amortization using the effective interest method, adjusted for any loss allowance. Interest income, foreign exchange gains and losses, as well as impairment, are recognized in profit or loss. Any gain or loss on recognition is recognized in profit or loss.

(ii) Fair value through other comprehensive income (FVOCI)

A debt investment is measured at FVOCI if it meets both of the following conditions and is not designated as at FVTPL ：

it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

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

Debt investments at FVOCI are subsequently measured at fair value. Interest income calculated using the effective interest method, foreign exchange gains and losses and impairment are recognized in profit or loss. Other net gains and losses are recognized in other comprehensive income. On recognition, gains and losses accumulated in other comprehensive income are reclassified to profit or loss.

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

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

(iii) Impairment of financial assets

The Company recognizes loss allowances for expected credit losses (ECL) on financial assets measured at amortized cost (including cash and cash equivalents, amortized costs, trade receivables and notes receivable, other receivables, leases receivable, guarantee deposit paid and other financial assets), debt investments measured at FVOCI and contract assets.

The Company measures loss allowances at an amount equal to lifetime ECL, except for the following which are measured as 12-month ECL:

debt securities that are determined to have low credit risk at the reporting date ； and
other debt securities and bank balances for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition.

Loss allowance for trade receivables and contract assets are always measured at an amount equal to lifetime ECL.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECL, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis based on the Company’s historical experience and informed credit assessment as well as forward-looking information.

The Company assumes that the credit risk on a financial asset has increased significantly if it is more than 180 days past due.

The Company considers a financial asset to be in default when the financial asset is more than 365 days past due or the debtor is unlikely to pay its credit obligations to the Company in full.

The Company considers a debt security to have low credit risk when its credit risk rating is equivalent to the globally understood definition of ‘investment grade which is considered to be BBB- or higher per Standard & Poor’s, Baa3 or higher per Moody’s or twA or higher per Taiwan Ratings’.

Lifetime ECL are the ECL that result from all possible default events over the expected life of a financial

See accompanying notes to financial statements.

instrument.

12-month ECL are the portion of ECL that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

The maximum period considered when estimating ECL is the maximum contractual period over which the Company is exposed to credit risk.

ECL are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e the difference between the cash flows due to the Company in accordance with the contract and the cash flows that the Company expects to receive). ECL are discounted at the effective interest rate of the financial asset.

At each reporting date, the Company assesses whether financial assets carried at amortized cost and debt securities at FVOCI are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit-impaired includes the following observable data:

significant financial difficulty of the borrower or issuer ；
a breach of contract such as a default or being more than 365 days past due ；
the lender of the borrower, for economic or contractual reasons relating to the borrower's financial difficulty, having granted to the borrower a concession that the lender would not otherwise consider ；
it is probable that the borrower will enter bankruptcy or other financial reorganization ； or
the disappearance of an active market for a security because of financial difficulties.

Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. For debt securities at FVOCI, the loss allowance is charge to profit or loss and is recognized in other comprehensive income instead of reducing the carrying amount of the asset.

The gross carrying amount of a financial asset is written off when the Company has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. For corporate customers, the Company individually makes an assessment with respect to the timing and amount of write-off based on whether there is a reasonable expectation of recovery. The Company expects no significant recovery from the amount written off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Company’s procedures for recovery of amounts due.

(iv) Derecognition of financial assets

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset. The Company enters into transactions whereby it transfers assets recognized in its statement of balance sheet, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognized.

(2) Financial liabilities
(i) Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss.

Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss.

(ii)Derecognition of financial liabilities

The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. The Company also derecognizes a financial liability when its terms are modified and

See accompanying notes to financial statements.

the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value.

On derecognition of a financial liability, the difference between the carrying amount of a financial liability extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.

(iii) Offsetting of financial assets and liabilities

Financial assets and financial liabilities are offset and the net amount presented in the statement of balance sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.

(g) Inventories

Inventories are measured at the lower of cost and net realizable value. The cost of inventories is calculated using the weighted average method, and includes expenditure incurred in acquiring the inventories, production or conversion costs, and other costs incurred in bringing them to their present location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of production overheads based on normal operating capacity.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

(h) Subsidiaries

The subsidiaries in which the Company holds controlling interest are accounted for under equity method in the non-consolidated financial statements. Under equity method, the net income, other comprehensive income and equity in the non-consolidated financial statement are the same as those attributable to the owners of parent in the consolidated financial statements.

The changes in ownership of the subsidiaries not causing losing controls, are recognized as equity transaction.

(i) Investment property

Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business, use in the production or supply of goods orservices,orforadministrativepurposes.Investmentpropertyismeasuredatcostoninitialrecognition, and subsequently at cost, less accumulated depreciation and accumulated impairment losses. Depreciation expense is calculated based on the depreciation method, useful life, and residual value which are the same as those adopted for property, plant and equipment.

Any gain or loss on disposal of an investment property (calculated as the difference between the net proceeds from disposal and the carrying amount) is recognized in profit or loss.

Rental income from investment property is recognized as other revenue on a straight-line basis over the term of the lease. Lease incentives granted are recognized as an integral part of the total rental income over the term of the lease.

(j) Property, plant and equipment
(i) Recognition and measurement

Items of property, plant and equipment are measured at cost, which includes capitalized borrowing costs, less accumulated depreciation and any accumulated impairment losses.

If significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment is recognized in profitor loss.

See accompanying notes to financial statements.

(ii)Subsequent expenditure

Subsequent expenditure is capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

(iii) Depreciation

Depreciation is calculated on the cost of an asset, less its residual value, and is recognized in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of property, plant and equipment.

Land is not depreciated.

The estimated useful lives of property, plant and equipment for current and comparative periods are as follows:

(1) Buildings 5～55years
(2) Machinery 5 ～ 10years
(3) Office equipment 3 ～ 10 years

Depreciation methods, useful lives and residual values are reviewed at and adjusted if appropriate.

(iv) Reclassification of self-used properties in to investment properties

TheCompanyusedthebookvalueofitsself-usedpropertiestoreclassifythemintoinvestmentproperties. (k) Leases

(i) Identifying a lease

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. As a lease

The Company recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be reliably determined, the Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate.

Lease payments included in the measurement of the lease liability comprise the following:

fixed payments, including in-substance fixed payments;
variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;
amounts expected to be payable under a residual value guarantee; and

See accompanying notes to financial statements.

payments for purchase or termination options that are reasonably certain to be exercised.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when:

there is a change in future lease payments arising from the change in an index or rate; or
there is a change in the Company’s estimate of the amount expected to be payable under a residual value guarantee; or
there is a change in the lease term resulting from a change of its assessment on whether it will exercise an option to purchase the underlying asset, or
there is a change of its assessment on whether it will exercise a extension or termination option; or
there is any lease modification

When the lease liability is remeasured, other than lease modifications, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or in profit and loss if the carrying amount of the right-of-use asset has been reduced to zero.

When the lease liability is remeasured to reflect the partial or full termination of the lease for lease modifications that decrease the scope of the lease, the Company accounts for the remeasurement of the lease liability by decreasing the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease, and recognize in profit or loss any gain or loss relating to the partial or full termination of the lease. The Company presents right-of-use assets that do not meet the definition of investment and lease liabilities as a separate line item respectively in the statement of financial position.

The Company has elected not to recognize right-of-use assets and lease liabilities for short-term leases of Office equipment that have a lease term of 12 months or less and leases of low-value assets, including IT equipment. The Company recognizes the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

For sale-and-leaseback transactions, the Company applies the requirements for determining when a performance obligation is satisfied in IFRS15 to determine whether the transfer of an asset is accounted for as a sale of the asset. If the transfer of an asset satisfies the requirement of IFRS15 to be accounted for as a sale of the asset, the Company derecognizes the transferred asset, then measures the right-of-use asset arising from the leaseback at the proportion of the previous carrying amount of the asset that relates to the right of use retained. Accordingly, the Company recognizes only the amount of any gain or loss that relates to the rights transferred to the buyer-lessor. For leaseback transaction, the Company applies the lessee accounting policy. If the transfer of an asset does not satisfy the requirement of IFRS15 to be accounted for as a sale of the asset, the Company continues to recognize the transferred asset and recognizes the financial liability equal to the transfer proceeds.

(ii)As a lessor

When the Group acts as a lessor, it determines at lease commencement whether each lease is a finance lease or an operating lease. To classify each lease, the Group makes an overall assessment of whether the lease transfers to the lessee substantially all of the risks and rewards of ownership incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; if not, then the lease is an operating lease. As part of this assessment, the Group considers certain indicators such as whether the lease is for the major part of the economic life of the asset.

When the Group is an intermediate lessor, it accounts for its interests in the head lease and the sub-lease separately. It assesses the lease classification of a sub-lease with reference to the right-of-use asset arising from the head lease. If a head lease is a short-term lease to which the Group applies the exemption described above, then it classifies the sub-lease as an operating lease.

If an arrangement contains lease and non-lease components, the Group applies IFRS15 to allocate the consideration in the contract.

The Group recognizes a finance lease receivable at an amount equal to its net investment in the lease. Initial direct costs, such as lessors to negotiate and arrange a lease, are included in the measurement of the net

See accompanying notes to financial statements.

investment. The interest income is recognized over the lease term based on a pattern reflecting a constant periodic rate of return on the net investment in the lease. The Group recognizes lease payments received under operating leases as income on a straight-line basis over the lease term as part of ‘other income’.

(l) Impairment of non-financial assets

At each reporting date, the Group reviews the carrying amounts of its non-financial assets (other than inventories, contract assets, deferred tax assets and investment properties and biological assets, measured at fair value, less costs) to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill is tested annually for impairment.

For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash-generating units (CGUs ） . Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the combination.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU.

An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its recoverable amount. Impairment losses are recognized in profit or loss. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

(m) Revenue Recognition
(i) Revenue from customer contracts

Revenue is measured by the consideration expected to be received in exchange for the transfer of goods or services. The company recognizes revenue when control over the goods or services is transferred to the customer, thereby satisfying performance obligations. The company provides the following explanations based on its primary revenue streams:

(1) Sale of Goods - Electronic Rectifier Diodes and Semiconductor Passive Components
The company manufactures electronic components and sells them to electronic equipment manufacturers. Revenue is recognized when control over the products is transferred. Control over the product is deemed to have been transferred when the product has been delivered to the customer, the customer has the full ability to decide on the sales channel and price of the product, and there are no unfulfilled obligations affecting the customer's acceptance of the product. Delivery occurs when the products are shipped to a specific location, and the Company risks of obsolescence, deterioration, and loss have been transferred to customers. Customers have accepted the products in accordance with the sales contract, the acceptance clauses have expired, or the merging company has objective evidence that all acceptance criteria have been met.

The Company shall recognize accounts receivable at the time of delivery of commodities, since the Company has the right to receive consideration unconditionally at that time.

(2) Rental income

Rental income from investment properties and income from leasing real estate are recognized as lease income in the operating revenue item.

(3) Financial Components

The company expects that the time between the transfer of goods or services to customers and the customer's payment for those goods or services does not exceed one year. Therefore, the company does not adjust the transaction price for the time value of money.

See accompanying notes to financial statements.

(n) Employee benefits
(i) Defined contribution plans

Obligations for contributions to defined contribution plans are expensed as the related service is provided.

(ii) Defined benefit plans

The Group’s net obligation in respect of defined benefit plans is calculated separately for each the plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Group, the recognized asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in other comprehensive income, and accumulated in retained earnings within equity. The Group determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability (asset). Net interest expense and other expenses related to defined benefit plans are recognized in profit or loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognized immediately in profit or loss. The Group recognizes gains and losses on the settlement of a defined benefit plan when the settlement occurs.

(iii) Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(o) Income taxes

Income taxes comprise current taxes and deferred taxes. Except for expenses related to business combinations or recognized directly in equity or other comprehensive income, all current and deferred taxes are recognized in profit or loss.

The Group has determined that the global minimum top-up tax – which it is required to pay under Pillar Two legislation – is an income tax in the scope of IAS 12. The Group has applied a temporary mandatory relief from deferred tax accounting for the impacts of the top-up tax and accounts for it as a current tax when it is incurred.

Current taxes comprise the expected tax payables or receivables on the taxable profits (losses) for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payables or receivables are the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes, if any. It is measured using tax rates enacted or substantively enacted at the reporting date.

Deferred taxes arise due to temporary differences between the carrying amounts of assets and liabilities at the reporting date and their respective tax bases. Deferred taxes are recognized except for the following:

(i) temporary differences on the initial recognition of assets and liabilities in a transaction that is not a business combination and at the time of the transaction affects neither accounting nor taxable profits (losses)and does not give rise to equal taxable and deductible temporary differences

See accompanying notes to financial statements.

(ii)temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that the Group is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and
(iii) taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets are recognized for the carry forward of unused tax losses, unused tax credits, and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefits will be realized.

Deferred taxes are measured at tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date, and reflect uncertainty related to income taxes, if any.

Deferred tax assets and liabilities are offset if the following criteria are met:

(i) the Group has a legally enforceable right to set off current tax assets against current tax liabilities; and
(ii) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on either:
- (1) the same taxable entity; or
- (2) different taxable entities which intend to settle current tax assets and liabilities on a net basis, or to realize the assets and liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.
(p) Earnings per share

The Group discloses the Company’s basic and diluted earnings per share attributable to ordinary shareholders of the Company. Basic earnings per share is calculated as the profit attributable to ordinary shareholders of the Company divided by the weighted average number of ordinary shares outstanding. Diluted earnings per share is calculated as the profit attributable to ordinary shareholders of the Company divided by the weighted average number of ordinary shares outstanding after adjustment for the effects of all potentially dilutive ordinary shares,

(q) Operating segments

Please refer to the consolidated financial report of Rectron Ltd. for the years ended December 31, 2024 and 2023 for operating segments information.

5. Significant accounting assumptions and judgments, and major sources of estimation uncertainty

In preparing these consolidated financial statements, management has made judgments and, estimates about the future, including climate-related risks and opportunities, that affect the application of the accounting policies and the reported amount of assets, liabilities, income, and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis and are consistent with the Group’s risk management and climate-related commitments where appropriate. Revisions to estimates are recognized prospectively in the period of the change and future periods.

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year is as follows:

See accompanying notes to financial statements.

(a) Allowance for doubtful accounts for accounts receivable.

The allowance for doubtful accounts is estimated based on assumptions regarding default risk and expected loss rates. The company considers historical experience, current market conditions, and forward-looking estimates on each reporting date to determine the assumptions and inputs to be used in calculating impairment. For detailed explanation of the related assumptions and input values, please refer to Note 6(d).

(b)Inventory evaluation

Due to the requirement to measure inventory at cost or net realizable value, whichever is lower, the Company assesses the amount of inventory cost to be written down to net realizable value due to normal wear and tear, obsolescence, or lack of market sales value as of the evaluation report date. The inventory valuation is primarily based on estimates of product demand during a specific future period, and may be subject to significant changes due to rapid changes in the industry. Please refer to Note 6(4) for details on the inventory valuation estimate.

The company's accounting policies and disclosures include the use of fair value measurement for its financial and non-financial assets and liabilities. The company has established internal control systems for fair value measurement. This includes establishing an assessment team responsible for reviewing all significant fair value measurements (including level 3 fair value) and reporting directly to the Chief Financial Officer. The assessment team periodically reviews significant unobservable inputs and adjustments. If third-party information (such as brokers or pricing service organizations) is used as inputs to measure fair value, the assessment team will evaluate the evidence supporting the input values provided by the third party to ensure that the valuation and its fair value classification comply with International Financial Reporting Standards. Investment properties are periodically valued by the company based on the evaluation methods and parameter assumptions specified by the Financial Supervisory Commission, or by external appraisers commissioned by the company.

The company strives to use market observable inputs as much as possible when measuring its assets and liabilities. The fair value level is classified based on the input values used by the valuation technique, as follows:

(1) Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
(2) Level 2: Inputs for the asset or liability that are directly (i.e., prices) or indirectly (i.e., derived from prices) observable, excluding those included in Level 1.
(3) Level 3: Inputs for the asset or liability that are unobservable (i.e., non-market observable inputs).

In the event of transfers between different levels of fair value hierarchy, the company recognizes the transfer on the reporting date.

Please refer to the following notes for information related to the assumptions used in measuring fair value:

Note 6(h): Investment properties.
Note 6(r): Financial instruments.

See accompanying notes to financial statements.

6. Explanation of significant accounts

(a) Cash and cash equivalents

Cash on hand and petty cash Cash in banks Time deposits Cash and cash equivalents in the statement of cash flows	December 31, 2024 $ 40 39,402 - $ 39,442	December 31, 2023
		41 40,322 27,635
		67,998

Please refer to Note 6(r) for the fair value sensitivity analysis and interest rate risk of the financial assets and liabilities.

(b) Financial assets

Non-current financial assets at fair value through other comprehensive income

Debt investments at fair value through other comprehensive income Corporate bonds– Apple Corporate bonds – AT&T Corporate bonds–Pfizer Corporate bonds–SocGen Equity investments at fair value through other comprehensive income Shares of stock of unlisted companies Total	December 31, 2024 $ 25,602 9,151 3,929 - 17,185 $ 55,867	December 31, 2023 25,735 9,144 4,121 3,090 15,546 57,636	December 31, 2023 25,735 9,144 4,121 3,090 15,546 57,636
	$

Debt investments at fair value through other comprehensive income

The Company investments in bonds measured at fair value through other comprehensive income in the financial statements as of December 31, 2024 and 2023. The effective interest rates range from 2.00% to 4.01%, and 2.00% to 4.09%, and the maturity dates range from 2036 to 2045. The Company holds bond investments through the business model of collecting contractual cash flows and selling financial assets, and therefore reports them as financial assets measured at fair value through other comprehensive income.

Equity investments at fair value through other comprehensive income

See accompanying notes to financial statements.

The Company designated the investments shown above as equity securities at fair value through other comprehensive income because these equity securities represent those investments that the Company intends to hold for the long term for strategic purposes.

For credit risk (including the impairment of debt investments) and market risk; please refer to note 6(r).
As of December 31, 2024 and 2023 the Company’s financial assets were not pledged as collateral.

(c) Trade receivables and notes receivable

) Trade receivables and notes receivab	le
Trade receivables $ Less: Loss allowance $	December 31, 2024 104,293 (57) 104,236	December 31, 2023
			54,602 (27) 54,575

The Company applies the simplified approach to provide for its expected credit losses, i.e. the use of lifetime expected loss provision for all receivables. To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due, as well as incorporated forward looking information, including macroeconomic and relevant industry information. The loss allowance provision were determined as follows:

	December 31, 2024
Gross carrying amount $ 83,580 20,173 $ 104,293	Weighted- average loss rate 0.05% 0.05%	Loss allowance provision
		44 13
		57

	December 31, 2023
Gross carrying amount $ 39,362 15,240 $ 54,602	Weighted- average loss rate 0.05% 0.05%	Loss allowance provision
		19 8
		27

See accompanying notes to financial statements.

The movements in the allowance for trade receivables and notes receivable were as follows:

Balance at January 1 Impairment losses recognized Balance at December 31	For the Years Ended	For the Years Ended	December 31,
			2023 - 27 27

As of December 31, 2024 and 2023 the Company’s the afore mentioned trade receivables and notes receivable were not pledged as collateral.

For credit risk please refer to note 6(r).

(d) Inventories

December 31, 2024 Raw materials and consumables 2,842 Work in progress 6,903 Finished goods 37,751 Goods and materials in transit 396 Subtotal 58,939 Less: Allowance for inventory market decline and obsolescence (642) 47,250	December 31, 2023
	2,568 2,461 52,246 1,664
	58,939 (642)
	58,297

As of December 31, 2024and December 31, 2023, the details of the cost of sales were as follows:

Inventory that has been sold The impact of actual production capacity being lower than normal production capacity. Selling used items and income from scrap			For the Years Ended December 31,	For the Years Ended December 31,	For the Years Ended December 31,
			2024		2023
			$ 438,875 1,847 (1,038) $439,684		405,857 - (1,121) 404,736

As of December 31, 2024 and 2023 the Company’s the afore mentioned trade receivables and notes receivable were not pledged as collateral.

(e) Investments accounted for using equity method

Investments accounted for using equity method
Subsidiary	December 31, 2024 $ 238,691	December 31, 2023
		561,628

1. Subsidiaries

Please refer to the consolidated financial statement for the year ended December 31, 2024.

See accompanying notes to financial statements.

The subsidiary, Zhejiang Rectron, based on the strategic transformation needs of its industrial park, signed a relocation compensation agreement with the Jiashan Development Zone in September 2023, stipulating a compensation amount of $726,205 thousand (RMB 161,653 thousand). In the same year, it received a contract signing payment of $363,105 thousand (RMB 80,827 thousand).

Furthermore, considering the overall planning of the group, the company decided to relocate to another factory within the same development zone. In August 2024, it signed a factory purchase agreement. To align with the new factory’s delivery schedule, both parties agreed to delay the relocation timeline. As of December 31, 2024, in accordance with the factory purchase agreement, the factory handover process has been completed, resulting in a payable factory amount of $179,263 thousand (RMB 39,904 thousand).

Additionally, on September 20, 2024, Zhejiang Rectron’s shareholders’ meeting resolved to reduce its registered capital from USD 12 million to USD 2 million. The business registration process was completed on November 15, 2024, and the capital reduction funds were remitted back to the parent company on January 2, 2025. As of December 31, 2024, the receivable capital reduction amount was $327,850 thousand (USD 10,000 thousand), recorded under "Other Receivables – Related Parties."

2. Pledge to secure

As of December 31, 2024 and 2023, the deals of the investments accounted for using equity method were not pledged as collateral.

(f) Property, plant and equipment

The cost and accumulated depreciation of the property, plant and equipment of the Company for the Years Ended December 31, 2024 and 2023 were as follows:

Cost: Balance at January 1, 2024 Additions Reclassification Reclassification of prepaid equipment payments to expenses. Balance at December 31, 2024 Balance at January 1, 2023 Additions Reclassification Balance at December 31, 2023 Accumulated depreciation: Balance at January 1, 2024 Depreciation Balance as of December 31, 2024 Balance as of January 1, 2023 Depreciation Balance at December 31, 2023 Carrying value: Balance at December 31, 2024 Balance at January1, 2023 Balance at December 31, 2023		Land 181,394 - - 181,394 181,394 - - 181,394 - - - - - - 181,394 181,394 181,394	Buildings and structures 94,503 304 - 94,807 94,503 - - 94,503 43,599 3,092 46,691 40,417 3,182 43,599 48,1164 54,0862 50,904	Machinery and equipment 191,977 - 165 - 191,977 191,977 - - 191,977 167,620 6,523 174,143 160,860 6,760 167,620 17,999 31,117 24,357	Office equipment 38,075 774 1,806 - 40,655 37,741 334 - 38,075 33,797 2,484 36,281 31,248 2,549 33,7978 4,374 6,493 4,278	Construction in progress 11,429 4,272 (1,971) (6,130) 7,600 12,015 4,377 (4,963) 11,429 - - - - - - 7,600 12,015 11,429	Total
	$ $ $ $ $ $ $ $ $ $ $						517,378 5,350 (6,130) 516,598 517,630 4,711 (4,963) 517,378 245,016 12,0991 257,115 232,525 12,491 245,016 259,483 285,105 272,362

December 31, 2024 and 2023, the Property, plant and equipment of the Company had been pledged as collateral for long-term borrowings; please refer to note 8.

See accompanying notes to financial statements.

(g) Right-of-use assets

The Company leases many assets including land and buildings, vehicles, and other equipment. Information about leases for which the Company is a lessee is presented below:

Machinery and equipment Cost: Balance at January 1, 2024 $ - Additions 2,514 Balance at December 31, 2024 $ 2,514 Balance at January 1, 2023 $ 1,442 Additions - Reduction (1,442) Balance at December 31, 2023 $ - Accumulated depreciation and impairment losses: Balance at January 1, 2024 $ - Depreciation for the year 280 Balance at December 31, 2024 $ 280 Balance at January 1, 2023 $ 1,202 Depreciation for the year 240 Reduction (1,442) Balance at December 31, 2023 $ -	Other equipment 343 - 343 - 343 - 343 68 68 136 - 68 - 68	Total
		434 2,514
		2,857
		1,442 343 (1,442)
		343
		68 348
		416
		1,202 308 (1,442)
		68

Carrying amount: Balance at December 31, 2024 Balance at December 31, 2023 Balance at January 1, 2023	$ 2,234 $ - $ 240		207 275 -	2,441 275 240

(h) Investment property

Investment property
Cost: Balance at January 1, 2024 Balance at December 31, 2024	Land and improvements $ 663,510 $ 663,510	Buildings 289,958 289,958	Total
			953,468
			953,468

See accompanying notes to financial statements.

Land and

Balance at January 1, 2023 Balance at December 31, 2023 Accumulated depreciation and impairment losses: Balance at January 1, 2024 Depreciation for the year Balance at December 31, 2024 Balance at January 1, 2023 Depreciation for the year Balance at December 31, 2023 Carrying amount: Balance at December31, 2024 Balance at January 1, 2023 Balance at December 31, 2023 Fair value: Balance at December 31, 2024 Balance at December 31, 2023 Balance at January 1, 2023	improvements $663,510 $ 663,510 $ - - $ - $ - - $- $ 663,510 $ 663,510 $ 663,510	Buildings 289,958 289,958 48,494 5,438 53,932 43,056 5,438 48,494 236,026 246,902 241,464		Total
				953,468
				953,468
				48,494 5,438
				53,932
				43,056 5,438
				48,494
			$	899,536 910,412 904,974 1,800,789 1,821,380 1,783,220
			$
			$

Investment properties are self-owned assets held by the Companies. The lease term for investment properties ranges from 1 to 6 years, and it is non-cancellable.
Due to the restriction in the law at that time, private entities were not allowed to acquire agricultural land. Therefore, the Companies appointed Mr. Lin Wen-Teng, one of the directors, to register the real estate investment under his personal name. To ensure the preservation of the Companies' assets, the property has been pledged back to the Companies.
The fair value of investment properties is based on evaluations conducted by independent appraisers who possess recognized professional qualifications and recent relevant experience in evaluating properties of similar location and type. These evaluations are based on market value. In the absence of active market prices, the appraisal considers the aggregate of estimated cash flows expected to be generated by renting out the property, and applies a discount rate that reflects the specific risks inherent in those net cash flows to determine the property's value.
As of December 31, 2024 and 2023 the Property, plant and equipment of the Company had been pledged as collateral for long-term borrowings; please refer to note 8.

See accompanying notes to financial statements.

(i) Short-term borrowings

m borrowings
Secured bank loans Unused short-term credit lines Range of interest rates	December 31, 2024	December 31, 2023 15,000 385,000 1.89%~2.20%
	$ -
	$ 420,000
	1.90%~2.01%

For the collateral for short-term borrowings, please refer to note 8.

(j)Operating Lease

Lease as Lessor

The Company leases its investment properties under operating leases. Please refer to Note 6(h) for details. The future minimum lease payments receivable under non-cancelable operating leases are as follows:

Less than one year One to five years	December 31, 2024	December 31, 2023 22,540 19,498 42,038
	$ 18,887 11,412
	$ 30,299

(k) Provisions

1. Defined benefit plans

The reconciliation of fair value of the defined benefit plans and plan assets is as follows:

Present value of defined benefit obligation Fair value of plan assets Net defined benefit liabilities	For the Ended December 31	For the Ended December 31
	2024 $ 5,960 (5,876) $ 84	2023 7,419 (5,210) 2,209

The Company makes defined benefit plan contributions to the pension fund account with Bank of Taiwan that provides pension benefits for its employees upon retirement. Plans (covered by the Labor Standards Law) entitle a retired employee to receive retirement benefits based on years of service and average monthly salary for six months prior to retirement.

1) Composition of plan assets

The Company sets aside pension funds in accordance with the Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund. Such funds are managed by the Bureau of Labor Funds, Ministry of Labor. Under these regulations, the minimum earnings from these pension funds shall not be less than the earnings from two-year time deposits with the interest rates offered by local banks.

The Company’s contributions to the pension funds were deposited with Bank of Taiwan amounting to $5,876 thousand as of the reporting date. For information on the utilization of the labor pension

See accompanying notes to financial statements.

fund assets, including the asset allocation and yield of the fund, please refer to the website of the Bureau of Labor Funds, Ministry of Labor.

2) Movements in present value of the defined benefit obligations

The movements in the present value of the defined benefit obligations for the years ended December 31, 2024 and 2023 were as follows:

Defined benefit obligations on January 1 Current service costs and interest Remeasurements of the net defined benefit liability (asset) `－`Actuarial losses from changes in financial assumption -Actuarial gains and losses arising from experience adjustments Benefits paid by the plan Defined benefit obligation on December 31		FortheYearsEndedDecember31 2024 2023 $ 7,419 9,523 89 124 (184) 229 58 - (1,422) (2,457) $ 5,960 7,419	FortheYearsEndedDecember31 2024 2023 $ 7,419 9,523 89 124 (184) 229 58 - (1,422) (2,457) $ 5,960 7,419	FortheYearsEndedDecember31 2024 2023 $ 7,419 9,523 89 124 (184) 229 58 - (1,422) (2,457) $ 5,960 7,419
			2024 $ 7,419 89 (184) 58 (1,422) $ 5,960

3) Movements on the defined benefit plan assets

The movements in the fair value of the defined benefit plan assets for the years ended December 31, 2024 and 2023 were as follows:

Fair value of plan assets on January1 Interest revenue Remeasurements of the net defined benefit liability(asset) －Return on plan assets (not including current interest cost) Contributed amount Benefits paid by the plan Fair value of plan asset on December 31	For the Years Ended December 31	For the Years Ended December 31
	2024 $ 5,210 63 489 114 - $ 5,876	2023 6,014 78 28 124 (1,034) 5,210
	$ $

See accompanying notes to financial statements.

4) Expenses recognized in profit and loss

The Company pension expenses recognized in profit or loss for the years ended December 31, 2024 and 2023 were as follows:

Net interests on net defined benefit liability (asset) Operating costs Operating expenses General and administrative expenses	For the Years Ended December 31 2024 2023 26 46 $ 26 46 $ 7 13 - 2 19 31 $ 26 46	For the Years Ended December 31 2024 2023 26 46 $ 26 46 $ 7 13 - 2 19 31 $ 26 46	For the Years Ended December 31 2024 2023 26 46 $ 26 46 $ 7 13 - 2 19 31 $ 26 46




			46

5) Remeasurement of net defined benefit liability (asset) recognized in other comprehensive income

The Company’s net defined benefit liability (asset) recognized in other comprehensive income for the years ended December31, 2024 and2023 were as follows:

Cumulative amount on January 1 Recognized during the year Cumulative amount on December 31			FortheYearsEndedDecember31 2024 2023 (1,031) (1,232) (615) 201 (1,646) (1,031)
			2024
	$		(1,031) (615)
	$		(1,646)

6) Actuarial assumptions

The key actuarial assumptions at the reporting date were as follows:

Discount rate Future salary increase rate	2024.12.31 2023.12.31
	1.60% 1.25% 1.20% 1.25%

See accompanying notes to financial statements.

Based on the actuarial report, the Company is expected to make a contribution payment of $112 thousand to the defined benefit plans for the one year period after the reporting date of 2024.

The weighted-average duration of the defined benefit plans is between 8 years.

7) Sensitivity analysis

As of December 31, 2024 and 2023, the changes in the principal actuarial assumptions that will have an impact on the present value of the defined benefit obligation were as follows:

December 31,2024 Discount rate Future salary increase rate December 31,2023 Discount rate Future salary increase rate		Impact on the present value of defined benefit obligation	Impact on the present value of defined benefit obligation
		Increase by 0.25% $ (111) 99 (127) 115	Decrease by 0.25%
			114 (97) 131 (113)

The sensitivity analysis assumed all other variables remain constant during the measurement. This may not be representative of the actual change in the defined benefit obligation as some of the variables may be correlated in the actual situation. The model used in the sensitivity analysis is the same as that of the defined benefit obligation liability.

The analysis is performed on the same basis for prior year.

2. Defined contribute on plans

The Company’s employee benefits retirement expenses respectively.

Operating cost Selling expenses Administration expenses Research and development expenses Total	For theYears EndedDecember31	For theYears EndedDecember31
	2024 $ 488 210 648 11 $ 1,357	2023 514 196 619 43 1,372

(l) Income tax

The components of income tax For the Years Ended December 31, 2024 and 2023 were as follows:

follows:
Current period incurred Undistributed earnings additional tax Prior years income tax adjustment Current tax expenses	For the Years Ended December 31,
	2024 23,982 - 100 $ 24,082	2023
		15,962 21 1,904
		17,887

(Continued)

The income tax on pre-tax financial income was reconciled with the income tax expense for the years ended December 31, 2024 and 2023 as follows:

Profit excluding income tax Income tax using the Company's domestic tax rate Gains from equity method Undistributed earnings Changes in unrecognized temporary differences (Overestimation)underestimate on from prior period Others Total		For the Years Ended December 31,	For the Years Ended December 31,	For the Years Ended December 31,
		2024 $149,613 29,922 (4,537) - (2,127) 100 724 $ 24,082		2023
				104,756
				20,951 (4,193) 21 (635) 1,904 (161)
				17,887

Deferred tax assets

1) Unrecognized deferred tax assets

Deferred tax assets 1) Unrecognized deferred tax assets
Tax effect of deductible Temporary Differences		December 31,2024 $ 22,394	December31,2023
				24,521

2) Recognized deferred tax assets and liabilities

The movements in deferred tax assets and liabilities for the years ended December 31, 2024 and 2023 were as follows:

Deferred Tax Liabilities: Balance at January 1, 2024 Balance at December 31, 2024 Balance at January 1, 2023 Balance at December 31, 2023	Provision for Land Value Tax
	$ 62,679
	$ 62,679
	$ 62,679
	$ 62,679

Company’s income tax return for the year 2022 and been examined by the tax authorities.
(m) Capital and other equity
Ordinary shares

As of December 31, 2024 and 2023 the authorized capital of the Company consisted of 400,000 thousand shares, respectively, at a par value of $10 per share, amounting to $4,000,000 thousand, respectively, and its outstanding capital were consisted of 166,303 thousand shares. All share proceeds from outstanding capital have been collected.

Capital surplus

Treasury share transactions	December 31, 2024	December 31, 2023
	$ 9	9

According to the R.O.C. Company Act, capital surplus can only be used to offset a deficit, and only the realized capital surplus can be used to increase the common stock or be distributed as cash dividends. The aforementioned realized capital surplus includes capital surplus resulting

(Continued)

from premium on issuance of capital stock and earnings from donated assets received. According to the Regulations Governing the Offering and Issuance of Securities by Securities Issuers, capital increases by transferring capital surplus in excess of the par value should not exceed 10% of the total common stock outstanding. 3. Retained earnings

If the Company has surplus in the annual final accounts, it shall pay taxes and donations in accordance with the law, offset cumulative losses, and then appropriate 10% as statutory surplus reserve. However, when the statutory surplus reserve has reached the Company's paid-in capital, no further appropriation is required. The remaining surplus shall be appropriated or reversed as required by laws and regulations, or transferred to the special surplus reserve. If there is still surplus, together with undistributed surplus at the beginning of the period, it will be classified as distributable surplus. The Board of Directors shall propose a surplus distribution plan for approval by the shareholders' meeting, and distribute dividends to the shareholders.

Taking into account financial, operational, and business factors, the Company may distribute dividends to shareholders, which shall not be less than 10% of the distributable surplus for the current fiscal year. However, if the accumulated distributable surplus is less than 3% of the paidin capital, no distribution shall be made. Dividends may be distributed in the form of cash dividends or stock dividends. Cash dividends shall be given priority in the distribution of earnings, but stock dividends may also be distributed. The proportion of cash dividends shall not be less than 10% of the total dividend amount.

For the distribution of dividends to shareholders in the form of cash, the Board of Directors is authorized to carry out such distribution with the approval of two-thirds or more of the attending directors and a majority of the attending directors, and to report it to the shareholders' meeting.

1) Legal reserve

When a company incurs profit, the shareholders shall decide on the distribution of the statutory earnings reserve either by issuing new shares or by paying cash of up to 25% of the actual share capital.

2) Special reserve

The Company chose to apply the exemption under IFRS 1 at its initial adoption of IFRSs. Any unrealized revaluation surplus, accumulated translation adjustment, and increasing amount incurred from adopting the fair value as cost for the assets classified as investment property at the transition date. According to the Financial Supervisory Commission's Order No. 1010012865 issued on April 6, 2012, an equal amount shall be appropriated to the special surplus reserve. When using, disposing of, or reclassifying related assets, a proportionate reversal of the originally appropriated special surplus reserve may be distributed as earnings.

According to the regulations of the Financial Supervisory Commission, when the Company distributes distributable earnings, the difference between the net amount of reductions in other shareholders' equity items recorded in the current year and the balance of the special surplus reserve mentioned above shall be considered. When distributing earnings for the fiscal year 2023, the Company will allocate the current year's income and the undistributed earnings from previous periods to the special surplus reserve. When distributing earnings for the fiscal year 2024, the Company will allocate the current year's after-tax net profit, along with items other than the current year's after-tax net profit, to the undistributed earnings and the special surplus reserve from previous periods. The Company is not allowed to distribute the amounts related to reductions in other shareholders' equity from previous periods, except for the allocation to the special surplus reserve. In the event of reversals in the amounts of reductions in other shareholders' equity in the future, earnings may be distributed based on

(Continued)

the reversed portion. As of December 31, 2024 and 2023, the balance of the special surplus reserve is $87,143 thousand and $60,074 thousand respectively.

3) Earnings distribution

The amounts of cash dividends and share dividends for the 2023 and 2021 earnings distribution had been approved, the board meeting held on March 15, 2024 and March 24, 2023; while the earnings distribution for2023 and 2021 had been approved during the shareholders’ meeting on June 26, 2024 and June 16, 2023 as follows:

Cash dividends distributed to ordinary shareholders	2023 Amount per share Total amount $ 0.31 51,554	2023 Amount per share Total amount $ 0.31 51,554	2022
	Amount per share $ 0.31		Amount per share Total amount 0.80 133,042
		51,554

The Company's Board of Directors resolved on March 11, 2025, to distribute cash dividends for the fiscal year 2024. Details regarding the distribution can be found on the Taiwan Stock Exchange's website. The dividend amounts for the shareholders are as follows:

Cash dividends distributed to ordinary shareholders	2024 Amount per share Total amount $ 0.58 96,456

4) OCI accumulated in reserves

Balance at January 1, 2024 Exchange differences on foreign operations Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income Balance at December 31, 2024 Balance at January 1, 2023 Exchange differences on foreign operations Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income Balance at December 31, 2023	Exchange differences on translation of foreign financial statements $ (83,104) (15,152) - $ (98,256) $ (55,153) (27,951) $ (83,104)	Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income Total (4,039) (87,143) (15,152) (1,001) (1,001)
		(5,040) (103,296)
		(4,921) (60,074) (27,591) 882 882
		(4,039) (87,143)

(Continued)

(n) Earnings per share

For the Years Ended December 31, 2024 and 2023, the Company’s earnings per share were calculated as follows:

Basic earnings per share
(i) Profit attributable to ordinary shareholders of the Company

Profit attributable to ordinary shareholders of the	Company	Company
Profit/(loss) of the Company for the year	For the year ended December 31
	2024 $ 125,531	2023
		86,869

(ii) Weighted-average number of ordinary shares Weighted-average number of ordinary shares(thousand shares) Earnings per share	For the year ended December 31	For the year ended December 31
	2024 166,303 $ 0.75	2023
		166,303
		0.52

2. Diluted earnings per share

The diluted earnings per share of the Company for the fiscal year 2024 and 2023are calculated based on the net income attributable to the equity holders of the Company and the adjusted weighted average number of ordinary shares outstanding, considering the dilutive effects of all potential ordinary shares. The calculations are as follows:

(i) Profit attributable to ordinary shareholders of the Company

Profit/(loss) attributable to ordinary shareholders of the Company (basic)	For the year ended December 31
	2024 2023 $125,531 86,869

(ii) Weighted-average number of ordinary shares

Weighted-average number of ordinary shares(thousand shares) (basic) Effect of employee share bonus Weighted-average number of ordinary shares (thousand shares)(diluted) Earnings per share	For the year ended December 31	For the year ended December 31
	2024 166,303 108 166,411 $ 0.75	2023
		166,303 85
		166,388
		0.52

(Continued)

(o) Revenue from contracts with customers

1. Disaggregation of revenue

For the Years Ended December 31, 2024

Electronics Division Property Management Division Total $ 547,504 23,217 570,721 51,656 - 51,656 6,094 - 6,094 $ 605,254 23,217 628,471 $ 605,254 - 605,254 - 23,328 23,217 $ 605,254 23,217 628,471 For the Years Ended December 31, 2023	Electronics Division Property Management Division Total $ 547,504 23,217 570,721 51,656 - 51,656 6,094 - 6,094 $ 605,254 23,217 628,471 $ 605,254 - 605,254 - 23,328 23,217 $ 605,254 23,217 628,471 For the Years Ended December 31, 2023		Total
			570,721 51,656 6,094
			628,471
			605,254 23,217
			628,471
Electronics Division $ 492,045 25,614 10,196 $ 527,855 $ 527,855 - $ 527,855	Property Management Division 20,926 - - 20,926 - 20,926 20,926	Total 512,971 25,614 10,196 548,781 527,855 20,926 548,781

(Continued)

2. Contract balances

. Contract balances
Trade receivables and notes receivable Less: allowance for impairment Contract liabilities	December 31, 2024 $121,355 (57) $121,298 -	December 31, 2023 59,262 (27)	January1, 2023 122,639 -

		59,235	122,639
		-	682

For details on trade receivables and allowance for impairment, please refer to note 6(c).

(p) Remunerations to employees, directors and supervisors

The Company’ s Articles of Incorporation require that earnings shall first be offset against any deficit, then, a minimum of 1% will be distributed as employee remuneration, and a maximum of 2% will be allocated as remuneration to directors. Employees who are entitled to receive the abovementioned employee remuneration, in share or cash, include the employees of the Company’s subsidiaries who meet certain specific requirements.

For the Years Ended December 31, 2024 and 2023, remuneration of employees of $1,900 thousand and $1,100 thousand, respectively, and remuneration of directors of $2,900 thousand and $1,500 thousand, respectively, were estimated on the basis of the Company’s net profit before tax, excluding the remuneration of employees and directors of each period, multiplied by the percentage of remuneration of employees and directors as specified in the Company’s articles of incorporation. Such amounts were recognized as operating expenses For the Years Ended December 31, 2024 and 2023, Management is expecting that the differences, if any, between the actual distributed amounts and estimated amounts will be treated as changes in accounting estimates and will be charged to profit or loss. The number of shares to be distributed was calculated based on the closing price of the Company’s ordinary shares, one day prior to Board of Directors meeting.

The amount of employee compensation approved by the Board of Directors for the fiscal year 2024 is consistent with the accrual amount in the individual financial statements for the fiscal year 2024. However, there is a difference of $600 thousand between the amount approved by the Board of Directors for director and supervisor remuneration and the accrual amount in the individual financial statements for the fiscal year 2024. This difference is primarily due to accounting estimates made by the company and has been recognized in the profit or loss for the fiscal year 2024. There is no difference between the amount of employee and director/supervisor compensation resolved by the Board of Directors for the year 2024 and the amount estimated in the individual financial statements for the same year. Relevant information can be found on the Taiwan Stock Exchange's website.

(Continued)

(q) Non-operating income and expenses

Other income

her income
Interest income Dividend income Rental Income	For the Years Ended December 31,
	2024 $ 4,382 455 914 $ 5,751	2023
		3,391 303 1,097
		4,791

Other gains and losses

For the Years Ended December 31, 2024 2023 Foreign exchange gains (losses) $ 10,854 2,738 Gain on disposal of investments 37 - Realized Gain on Disposal of Assets - Subsidiaries 1,662 1673 Income from Manpower Support 634 1,695 Expenditure on Manpower Support (634) (1,695) Other 50 23 $ 12,603 4,434 3. Finance costs For the Years Ended December 31, 2024 2023 Interest expense $(243) (576)	For the Years Ended December 31,	For the Years Ended December 31,
		2023
		2,738 - 1673 1,695 (1,695) 23
		4,434
	2024 $(243)	2023
		(576)

(r)Financial instruments

Credit risk
(i) Credit risk exposure

The carrying amount of financial assets and contract assets represents the maximum amount exposed to credit risk.

(ii) Concentration of credit risk

The Company has a broad customer base and does not engage in significant transactions with any single customer. Additionally, its sales are geographically diversified. Therefore, there is no significant concentration of credit risk.

(iii) Receivables and debt securities

For credit risk exposure of trade receivables and notes receivable, please refer to note 6(c).

Other financial assets at amortized cost include other receivables. All of these financial assets are considered to have low risk, and thus, the impairment provision recognized during the period was limited to 12-month expected credit losses. The fixed deposits held by the

(Continued)

Company are transacted with and settled by financial institutions that have investment-grade ratings or above. Therefore, they are considered to have low risk.

The loss allowances were determined as follows:

Balance at January 1, 2024 Balance at December 31, 2024 Balance at January 1, 2023 Balance at March 31, 2023	Other receivables
	$ 36,992
	$ 36,992
	$ 36,992
	$ 36,992

2. Liquidity risk

The following table shows the contractual maturities of financial liabilities, including estimated interest payments and excluding the impact of netting agreements.

December 31, 2024 Non-derivative financial liabilities Non-interest bearing liabilities Lease liabilities(include non- current) December 31, 2023 Non-derivative financial liabilities Floating rate instruments Non-interest bearing liabilities Lease liabilities(include non- current)	Carrying amount Contractual cash flows Within 6 months 6-12 months 1-2 years 2-5 years Over 5 years
	$ 80,937 80,937 80,900 37 - - - 2,458 469 469 469 1,586 -* -
	$ 83,395 83461 81,369 506 1,586 -
	$ 15,000 15,143 5,095 10,048 - - - 119,776 119,776 119,776 - - - - 277 288 36 36 144 72 -
	$ 193,458 139,516 139,516 10,084 144 72

The Company does not expect the cash flows included in the maturity analysis to occur significantly earlier or at significantly different amounts.

Currency risk
(i) Exposure to foreign currency risk

The Company’s significant exposure to foreign currency risk was as follows:

Financial assets Monetary items USD Non-monetary items USD Financial liabilities Monetary items USD		December 31, 2024 Foreign currency Exchange rate NTD $ 14,363 32.785 470,891 1,180 32.785 38,682 1,586 32.785 51,997		December 31, 2023 Foreign currency Exchange rate NTD 3,893 30.705 119,535 1,371 30.705 42,090 3,114 30.705 95,615

(Continued)

(ii) Sensitivity analysis

The Company’s exposure to foreign currency risk arises from the translation of the foreign currency exchange gains and losses on cash and cash equivalents, trade and other receivables, financial assets at fair value through other comprehensive income, and trade and other payables that are denominated in foreign currency.

A strengthening (weakening) of 0.5%of the NTD against the USD, and HKD as at 2024 and 2023 would have increased (decreased) the net profit after tax by $1,676 thousand and $96 thousand, and the equity by $155 thousand and $168 thousand. The analysis is performed on the same basis.

(iii) Foreign exchange gain and loss on monetary items

Since the Company has many kinds of functional currency, the information on foreign exchange gain (loss) on monetary items is disclosed by total amount. For the Years Ended December 31, 2024 and 2023, the foreign exchange gain (loss) (including realized and unrealized portions) amounted to $10,854 thousand and $2,738 thousand, respectively.

4. Interest rate analysis

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

The following sensitivity analysis is based on the exposure to the interest rate risk of derivative and non-derivative financial instruments on the reporting date. Regarding assets with variable interest rates, the analysis is based on the assumption that the amount of assets outstanding at the reporting date was outstanding throughout the year. The rate of change is expressed as the interest rate increases or decreases by 0.5% when reporting to management internally, which also represents the Company management's assessment of the reasonably possible interest rate change.

If the interest rate had increased / decreased by 0.5% basis points, the Company’s net income would have increased / decreased by $0 thousand and $60 thousand For the Years Ended December 31, 2024 and 2023, respectively, with all other variable factors remaining constant. This is mainly due to the Company’s borrowing at variable rates.

5. Other market price risk

For the Years Ended December 31, 2024 and 2023, the sensitivity analyses for the changes in the securities price at the reporting date were performed using the same basis for profit or loss as illustrated below:

For the Years Ended December 31, 2024 and 2023, the sensitivity analyses for the changes in the securities price at the reporting date were performed using the same basis for profit or loss as illustrated below:	ecember 31, 2024 and 2023, the sensitivity analyses for the changes at the reporting date were performed using the same basis for profit or w:	ecember 31, 2024 and 2023, the sensitivity analyses for the changes at the reporting date were performed using the same basis for profit or w:	ecember 31, 2024 and 2023, the sensitivity analyses for the changes at the reporting date were performed using the same basis for profit or w:	ecember 31, 2024 and 2023, the sensitivity analyses for the changes at the reporting date were performed using the same basis for profit or w:	ecember 31, 2024 and 2023, the sensitivity analyses for the changes at the reporting date were performed using the same basis for profit or w:
For the Years Ended December 31, 2024 2023 Prices of securities at the reporting date Other comprehensive income after tax Net income Other comprehensive income after tax Net income	For the Years Ended December 31,
	2024 2023
			Net income Other comprehensive income after tax		Net income
0.5% increase $ 0.5% decrease $		86 (86)	- -	78 (78)	- -

Fair value of financial instruments
(i) Fair value hierarchy

The carrying amount and fair value of the Company’s financial assets and liabilities, including the information on fair value hierarchy, were as follows; however, except as described in the following paragraphs, for financial instruments not measured at fair value whose carrying amount is reasonably close to the fair value, and lease liabilities, disclosure of fair value information is not required:

(Continued)

		December 31, 2024	December 31, 2024	December 31, 2024	December 31, 2024	December 31, 2024
Book Value				Fair Value			Total
		Level 1		Level 2		Level 3
386,82 17,185			- -	38,682 17,185		- -	38,682 17,185
55,867			-	55,867		-	55,867
39,442 121,298 333,832 1,167			- - -	- - -		- - -	- - -
495,739
$ 551,606			-	55,867			55,867
55,575 25,362 2,458 $ 83,395			- - -	- - -		- - -	- - -

			December 31, 2023
Book Value 42,090 15,546 57,636 67,998 59,235 1,308 187				Fair Value			Total 42,090 15,546 57,636 - - - -
		Level 1 - - - - -		Level 2		Level 3 - - - - -
				- - - -	42,090 15,546
	57,636				57,636			57,636
	67,998 59,235 1,308 187
128,728		-				-	-
$ 186,364		-			57,636			57,636
$15,000 98,870 20,906 277 $ 135,053		- - - -		- - - -		- - - -	- - - -

(Continued)

(ii) Valuation techniques for financial instruments measured at fair value

A financial instrument is regarded as being quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency and those prices represent actual and regularly occurring market transactions on an arm’s-length basis. Whether transactions are taking place ‘regularly’ is a matter of judgment and depends on the facts and circumstances of the market for the instrument.

Quoted market prices may not be indicative of the fair value of an instrument if the activity in the market is infrequent, the market is not well-established, only small volumes are traded, or bid-ask spreads are very wide. Determining whether a market is active involves judgment.

Measurements of fair value of financial instruments without an active market are based on valuation technique or quoted price from a competitor. Fair value, measured by using valuation technique that can be extrapolated from either similar financial instruments or discounted cash flow method or other valuation techniques, including models, is calculated based on available market data at the reporting date.

(iii) Transfers between Level 1 and Level 2

There were no transfers from level 2 to level 1 For the Years Ended December 31, 2024 and 2023.

(s) Financial risk management

1. Overview

The Company has exposure to the following risks from its financial instruments:

(i) Credit risk

(ii) Liquidity risk

(iii) Market risk

The following likewise discusses the Company’s objectives, policies and processes for measuring and managing the above mentioned risks. For more disclosures about the quantitative effects of these risks’ exposures, please refer to the respective notes in the accompanying consolidated financial statements.

2. Structure of risk management

The company's Financial Management Department provides services to various business units, coordinating access to domestic and international financial markets. It supervises and manages the financial risks related to the company's operations by analyzing internal risk reports according to the level and breadth of risk. Internal auditors continuously review compliance with policies and exposure limits. The company does not engage in trading financial instruments (including derivative financial instruments) for speculative purposes.

3. Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Company’s receivables from customers and investments in debt securities.

(Continued)

(i) Accounts receivable and other receivables

The company's policy is to transact only with reputable counterparties and, where necessary, to obtain collateral to mitigate the risk of financial loss due to defaults. The company transacts only with entities rated equivalent to investment grade. This information is provided by independent rating agencies. In cases where such information is not available, the company uses other publicly available financial information and transaction records to assess the creditworthiness of major customers. The company continuously monitors credit exposures and the credit ratings of counterparties. It diversifies total transaction amounts among counterparties with qualifying credit ratings and controls credit exposures through annual review and approval of counterparties' credit limits.

As the company has a broad customer base, does not significantly concentrate transactions with any single customer, and operates in diversified sales regions, the credit risk associated with accounts receivable is not significantly concentrated. To further mitigate credit risk, the company regularly assesses the financial condition of its customers but typically does not require collateral.

(ii) Investment

The credit risk exposure for the bank deposits, fixed income investments and other financial instruments are measured and monitored by the Company’s finance department. As the Company deals with the banks and other external parties with good credit standing and financial institutions, corporate organization and government agencies which are graded above investment level, management believes that the Company do not have compliance issues and no significant credit risk.

(iii) Guarantee

The company's policy dictates that financial guarantees can only be provided to whollyowned subsidiaries. As of December 31, 2024, and December 31, 2023, the company has not provided any endorsements or guarantees.

4. Liquidity risk

The company manages and maintains sufficient cash and cash equivalents to support its operations and mitigate the impact of fluctuations in cash flows. Management oversees the utilization of bank financing facilities and ensures compliance with loan agreement terms.

Bank borrowings are an important source of liquidity for the company. As of December 31, 2024, and December 31, 2023, the unused portion of the short-term bank borrowing facilities amounted to $420,000 thousand and $385,000 thousand, respectively.

5. Market risk

Market risk is a risk that arises from changes in market prices, such as foreign exchange rates, interest rates and equity prices that affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

(i) Currency risk

The company is exposed to exchange rate risk arising from sales and purchases denominated in currencies other than the functional currency of each respective group entity. The primary currencies involved in these transactions are TWD and USD.

(ii) Interest rate risk

The company is exposed to cash flow risk due to its borrowings at floating interest rates. To manage this interest rate risk, the company maintains an appropriate portfolio of floatingrate instruments.

(Continued)

(t)Capital management

The company's capital management objective is to safeguard its ability to continue operations, thereby ensuring the provision of returns to shareholders and other stakeholders, while maintaining an optimal capital structure to minimize the cost of capital.

To maintain or adjust its capital structure, the company may adjust dividend payments to shareholders, reduce capital and return it to shareholders, issue new shares, or sell assets to repay liabilities.

Similar to its peers, the company manages its capital based on the debt-to-capital ratio. This ratio is calculated by dividing net debt by total capital. Net debt is calculated as total liabilities reported in the balance sheet minus cash and cash equivalents. Total capital includes all components of equity (i.e., share capital, capital surplus, retained earnings, and other equity) plus net debt.

The company's capital management policy in 2024 remained consistent with that of 2023, maintaining a debt-to-capital ratio between 7% and 8%, ensuring the ability to finance at reasonable costs. The debtto-capital ratios as of December 31, 2024, and December 31, 2023, are as follows:

Total liabilities Less: cash and cash equivalents Net debt Total equity Adjusted equity Debt-to-equity ratio	December 31, 2024 $ 167,401 (39,442) 127,959 1,834,036 $ 1,961,995 7%	December 31, 2023
		212,575 (67,998)
		144,577 1775,597
		1,920,174
		8%

As of December 31, 2024, the company's capital management approach remained unchanged from the previous year.

7. Related-party transactions

(a) Names and relationship with the Company

The following are related parties that had transactions with the Company during the periods covered in the non-consolidated financial statements.

Name of related party

Rectron (China) Limited (Rectron China) Zhejiang Rectron Electronic Co.,LTD. (Zhejiang

Relationship with the Company

A subsidiary of the Company A subsidiary of the Company

Rectron)

RECTRON ELECTRONIC ENTERPRISES,INC

A subsidiary of the Company

(REEI)

CHU-TING ENTERPRISE CO., LTD. (Chu-Ting) PU HWUA ENTERPRISE CO., LTD.(Pu Hwua) JuyangXingye Industrial Co., Ltd. ( JuyangXingye) Juiye Enterprise Co., Ltd.(Juiye Enterprise) LIN, WEN-TENG

A subsidiary of the Company Other related parties Other related parties Other related parties Director of this company

(Continued)

(b) Significant transactions with related parties

1. Sales

The amounts of significant sales by the Company to related parties were as follows:

Subsidiaries: Rectron China REEI Zhejiang Rectron	For the Years Ended December 31, 2024 2023 $ 2,038 - 51,656 24,118 14,821 2,819 $68,515 26,937
	2024 $ 2,038 51,656 14,821 $68,515

(i) The company sells goods to related parties at cost plus an agreed-upon profit margin. The credit terms for related parties are determined based on the product type and the location of the related entities, with an average credit period of approximately 30 to 120 days. For regular customers, the credit period is approximately 30 to 75 days. Actual transactions may require adjustments based on factors such as order quantity, product quality, and market conditions.
(ii) The unrealized losses on unsold inventory with subsidiaries for the fiscal years 2024 and 2023 amounted to $(1,529) thousand and $901 thousand, respectively. These losses are recognized under investments accounted for using the equity method.
Purchase

The amounts of significant purchase by the Company to related parties were as follows:

Subsidiaries: Rectron China	For the Years Ended December 31, 2024 2023 $300,750 281,071
	2024 $300,750

The company's purchases from related parties are primarily based on the cost of finished goods plus an agreed-upon profit margin, and the payment terms for these purchases range from 90 to 120 days. For regular customers, the payment terms are approximately 30 to 90 days. Actual payment terms may be adjusted considering the overall fund allocation within the group.

3.Receivables from related parties
(i) The receivables from related parties were as follows:

Account Trade receivables Trade receivables Trade receivables	Relationship Subsidiaries- Rectron China Subsidiaries-REEI Subsidiaries-Zhejiang Rectron	December 31, 2024 $ 463 16,166 433 17,062	December 31, 2023 - 4,658 2 46,60

The company's credit policy for related parties is based on mutually agreed upon payment terms.

(Continued)

(ii) Other Receivables from related parties

The other receivables from related parties were as follows:

Account Other receivables Other receivables	Relationship Subsidiaries- Chu-Ting Subsidiaries-Rectron China	December 31, 2024 $ 5,339 328,016 $ 333,355	December 31, 2023 82 166 248

4.Payables to related parties
(i) The payables to related parties were as follows:

Account Accounts payable	Relationship Subsidiaries-Rectron China	December 31, 2024 $ 9,663	December 31, 2023 77,716

(ii) Other payable

Account Other payable Other payable Other payable	Relationship Subsidiaries-Rectron China Subsidiaries-Chu-Ting Subsidiaries-Pu Hwua	December 31, 2024 $ 21 8 26 $ 55	December 31, 2023 101 29 108 238

(iii) Acquisition of property, plant and equipment

The transaction of real estate, plant, and equipment between the Company and its subsidiary had an acquisition price of $165 thousand. The unrealized loss embedded in the transaction for the year 2024 was $457 thousand, of which $11 thousand has been realized during the current period and recorded under investments accounted for using the equity method.

(iv) Disposed of property, plant and equipment

The unrealized gains on transactions of real estate, buildings, and equipment with subsidiaries for the fiscal years 2024 and 2023 amounted to $2,999 thousand and $3,417 thousand, respectively. An amount of $418 thousand of these gains was realized in the current period and is recognized under investments accounted for using the equity method.

(v) Disposed Restricted Assets

The unrealized gains on transactions of restricted assets with subsidiaries for the fiscal years 2024 and 2023 amounted to $8,994 thousand and $10,249 thousand, respectively. An amount of $1,255 thousand of these gains was realized in the current period and is recognized under investments accounted for using the equity method.

5.Leases

(i) The company leased factory buildings to its subsidiaries, reporting rental income from external leasing activities of $913 thousand for the fiscal year 2024 and $1,097 thousand for the fiscal year 2023.

(Continued)

(ii) The company leased investment properties to other related parties, reporting operating lease income of $1,741 thousand for the fiscal year 2024 and $1,719 thousand for the fiscal year 2023. The related security deposits for the above were $270 thousand and $405 thousand, respectively.

6.Others

(i) Please refer to Note 6(h) for details on the company's registration of real estate in the names of other related parties.
(ii) The company's subsidiary, Chu-Ting entered into outsourcing manufacturing and service contracts with the company to provide manpower assistance to manufacture and promote medical products. The revenue generated from these contracts for the fiscal years 2024 and 2023 amounted to $634 thousand and $1,695 thousand, respectively (recognized under other income and expenses).
(iii) Operating expenses for subsidiaries for the fiscal years 2024 and 2023 amounted to NT$217 thousand and $696 thousand, respectively. Operating expenses for other related parties for the fiscal years 2024 and 2023 amounted to $1,268 thousand and $2,608 thousand, respectively.
(c) Key management personnel compensation

Key management personnel compensation comprised:

Short-term employee benefits Post-employment benefits	For the Years Ended December 31,	For the Years Ended December 31,
	2024 $ 3,707 163 $ 3,870	2023
		2,353 95
		2,448

8. Assets pledged as security

The carrying amounts of assets pledged as security were as follows:

Assets pledged as security Property, plant and equipment Investment property	Liabilities secured by pledge Long-term borrowings Long-term borrowings	December 31, 2024 $ 229,510 49,507 $279,017	December 31, 2023
			232,298 50,605
			282,903

9. Significant Commitments and Contingencies

(a) Unrecognized contractual commitments

As of December 31, 2024, and 2023, the detailed amounts of the contract prices for equipment and construction projects entered into by the Company with suppliers are as follows:

Signed-contract Paid-price 10. Losses due to major disasters: none	December 31, 2024 $5,800 $ 2,867	December 31, 2023
		9,900
		6,974

11. Subsequent events: none

(Continued)

12. Others

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

By function By item		For the Years Ended December 31,	For the Years Ended December 31,	For the Years Ended December 31,	For the Years Ended December 31,
		2024			2023
	Cost of sales	Operating expenses	Total	Cost of sales	Operating expenses	Total
Employee benefits Salary Labor and health insurance Pension Remuneration of directors Others Depreciation Amortization	11,281 1,313 495 640 15,063 164	20,709 1,694 888 5,300 879 2,822 1,974	31,990 3,007 1,383 5,300 1,519 17,885 2,138	12,262 1,366 527 1,231 14,964 174	23,219 1,815 891 3,305 1,215 3,273 2,368	35,481 3,181 1,418 3,305 2,446 18,237 2,542

For the years ended December 31, 2024 and 2023, the information on the number of employees and employee benefit expense of the Company is as follows:

Numbers of employees Numbers of directors (non-employee) Average employee benefit expenses Average employee salary expenses Percentages of average employee salary expense Remuneration of supervisors	2024 54 7 806 681 (7.85)% -	2023 55 7 886 739 21.35% -

The Company's salary and remuneration policy information (including directors, managers and employees) is as follows:

(b) Independent Directors:
(i) Independent directors' remuneration shall be paid at least every six months regardless of the company's operating profit or loss, based on their level of participation and the value of their contributions to the company.
(ii) Independent directors do not participate in the distribution of directors' remuneration or other bonus allocations.
(c) Other Directors:
(i) Remuneration for other directors is determined based on their level of participation and the value of their contributions to the company, taking into account industry standards.
(ii) Directors' remuneration is allocated according to the rates stipulated in the company's articles of association.
(iii) Car and miscellaneous expenses are provided as needed for actual business execution.
(d) Executives:
(i) Monthly fixed salaries are determined based on the salary standards for each position.
(ii) Performance bonuses are distributed based on performance evaluation results.

(Continued)

(iii) Year-end bonuses are distributed based on employee performance evaluation results.
(iv) Employee compensation is allocated according to the rates stipulated in the company's articles of association.
(v) Relevant allowances and subsidies are provided based on job duties and standards.
(e) Other Employees:

Employee salaries are determined according to the principles of salary grading for each position. Employee compensation is generally divided into regular and irregular income.

Regular income includes basic salary, managerial allowances, position allowances, meal subsidies, and other subsidies.

13. Other disclosure items

(a) Information on significant transaction:

The followings were the information on significant transactions required by the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” for the Company For the Years Ended December 31, 2024:

Lending to other parties:

==> picture [426 x 71] intentionally omitted <==

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

Highest
balance Collateral
of Actual Transaction
financing usage Range of Purposes amount for Reasons for Allowance
to other amount interest of fund business short-term for bad Individual Maximum
Number Name of lender borrower Name of Account name Related party parties during the balance Ending during period the during the period rates financing borrower for the two parties between financing debt Item Value loan limits funding financing limit of fund
period
0 Rectron China CHU-TING Other Yes 91,142 91,142 91,142 - 2 - Operation - - - 157,270 157,270
receivables (note 3) Requirements
----- End of picture text -----

Note 1: For business transactions with counterparties, the business transaction amount is determined based on the cumulative sales (or purchases) amount between the two parties over the preceding twelve months.

Note2: According tour policy, the calculation for the maximum total amount of loans granted are as follows: (1) The Company

Individual counterparty funding limit = Shareholders' equity x 40% = $1,834,036thousand x 40% = $733,614 thousand.

The maximum funding limit for an individual counterparty = Shareholders' equity x 40% = $1,834,036thousand x 40% = $733,614 thousand.

(2) Rectron Electronics (China)

Individual counterparty funding limit = Shareholders' equity x 200% = $78,635thousand x 200% = $157,270thousand.

The maximum funding limit for an individual counterparty = Shareholders' equity x 200% = $78,635thousand x 200% = $157,270 thousand.

Note 3: (1) Business transaction with counterparts exists.

(2) Short-term funding is necessary.
Guarantees and endorsements for other parties: None.
Information regarding securities held at the reporting date (subsidiaries, associates and joint ventures not included):

(Amounts in Thousands of New Taiwan Dollar)

Company holding securities	Security type and name	Relationship with the Company	Account		December	31, 2024	31, 2024
				Shares	Carrying value	Percentage of ownership (%)	Market value ( or net value)
The Company	Stock - Sunny Bank	-	Non-current financial assets at fair value through other comprehensive income	1,621,261	17,185	0.05%	17,185
The Company	Corporate bonds – Apple	-	Non-current financial assets at fair value through other comprehensive income	-	25,602	-%	25,602
The Company	Corporate bonds – AT&T	-	Non-current financial assets at fair value through other comprehensive income	-	9,151	-%	9,151
The Company	Corporate bonds – Pfizer	-	Non-current financial assets at fair value through other comprehensive income	-	3,929	- %	3,929
CHU-TING	Fund - Yuanta High Dividend 0056	-	Current financial assets at fair value through profit or loss	21,000	770	-%	770
CHU-TING	Stock – TESLA	-	Current financial assets at fair value through profit or loss	5,150	68,186	-%	68,186
CHU-TING	Stock - NVDA	-	Current financial assets at fair value through profit or loss	14,450	63,619	- %	63,619

(Continued)

Information regarding purchase or sale of securities for the period exceeding 300 million or 20% of the Company’s paid-in capital: None.
Information regarding acquisition of real estate exceeding 300 million or 20% of the Company’s paid-in capital:

								(Amounts in Thousands	(Amounts in Thousands	(Amounts in Thousands	of New Taiwan Dollar)	of New Taiwan Dollar)	of New Taiwan Dollar)
Name of company	Type of property	Transact ion date	Transaction amount	Amount actually payable	Counter- party	Nature of relationship	For tr owner	ansactions involving related parties, the previous transfer information			Price reference	Purpose of Acquisit ion and Usage	Other terms
								Relationship with the Issuer	Transfer Date	amount
The Company	Land and Building	2024.1.10	- (Note 1)	- (Note 1)	CHU- TING	Parent- subsidiary relationship	-	-	-	-	Appraisal	private use	None
CHU-TING	Land	2024.1.10	- (Note 1)	- (Note 1)	The Company	Parent- subsidiary relationship	-	-	-	-	Appraisal	private use	None

Note 1: A joint development agreement for the land located at Parcel No. 145, Pei Bo Section, Tucheng District, New Taipei City, Taiwan, has been signed with the following distribution ratio: Landowner (the company): approximately 45.66%, Developer (CHUTING): approximately 54.34%. The final joint development ratio shall be subject to approval by the competent authority.

Information regarding receivables from disposal of real estate exceeding 300 million or 20% of

the Company’s paid-in capital:

Name of company	Type of property	Transacti on date	Acquisition date	Book value	Transacti on amount	Amount actually received	Gain from disposal	Counter- party	Nature of relatio nship	Purpose of disposal	Price reference	Other terms
Zhejiang Rectron	Land, Buildings, and Structures	2024.9.22	90.08	167,646 (Note 1)	726,205 (Note 2)	363,105 (Note 3)	(Note 4)	Jiashan Economic Development Assets Management Co., Ltd.	None	To align with organic renewal and industry transformati on and upgrading	Appraisal Report	(Note 5)

Note 1:RMB37,318 thousand Note 2:RMB161,653 thousand Note 3:RMB80,827 thousand Note 4: Profit and loss shall be confirmed after all relocation procedures are completed. Note 5: Receive compensation payments in accordance with the relocation compensation agreement.

Information regarding related-party purchases and/or sales exceeding 100 million or 20% of the Company’s paid-in capital:

							(Amounts in Thousands of New Taiwan Dollar)	(Amounts in Thousands of New Taiwan Dollar)	(Amounts in Thousands of New Taiwan Dollar)	(Amounts in Thousands of New Taiwan Dollar)	(Amounts in Thousands of New Taiwan Dollar)
Company name	Related party	Nature of relationship		Transac	tion details		Abno transa	rmal ction	Trade receivables (payables) and notes receivable (payable)		Remark
			Item	Amount	Percentage of the purchases (sales) (%)	Payment term	Unit price	Payment terms	Ending balance	Percentage of total receivables (payables)
The Company Rectron China Rectron China Zhejiang Rectron	Rectron China The Company Zhejiang Rectron Rectron China	Parent-subsidiary relationship Parent-subsidiary relationship Investee companies that are also evaluated using the equity method by the Company Investee companies that are also evaluated using the equity method bythe Company	Purchase Sales Purchase Sales	300,750 (300,750) 269,460 (269,460)	69% (100))% 100% (74)%	Normal Normal Normal Normal	Normal Normal Normal Normal	90-120 Days 90-120 Days 120 Days 120 Days	(9,663) 9,663 (9,819) 9,819	17% 94% (100)% 18%

Information regarding receivables from related parties exceeding 100 million or 20% of the Company’s paid-in capital:

					(Amounts in Thousands of New Taiwan Dollar) Overdue Amount received in subsequent period Allowance for bad debts Amount Action taken - - - - - - - -	(Amounts in Thousands of New Taiwan Dollar) Overdue Amount received in subsequent period Allowance for bad debts Amount Action taken - - - - - - - -	(Amounts in Thousands of New Taiwan Dollar) Overdue Amount received in subsequent period Allowance for bad debts Amount Action taken - - - - - - - -	(Amounts in Thousands of New Taiwan Dollar) Overdue Amount received in subsequent period Allowance for bad debts Amount Action taken - - - - - - - -
Company name	Related party	Nature of relationship	Balance as December 31, 2024	Turnover	O	verdue	Amount received in subsequent period	Allowance for bad debts
					Amount	Action taken
The Company	Rectron China	Parent-subsidiary relationship	327,850	-%	-	-	-	-
Rectron China	The Company	Parent-subsidiary relationship	327,850	-%	-	-	-	-

Note: It is a receivable capital reduction payment.

Information regarding trading in derivative financial instruments: None.

(Continued)

(b) Information on investments:

The followings are the information on investees For the Years Ended December 31, 2024:

(Amounts in Thousands of New Taiwan Dollar)

Name of investor	Name of investee	Location	Main businesses	Original i am	nvestment ount	Balance a	s of December 31, 2024	s of December 31, 2024	Net income (loss) of the investee	Investment income (loss) recognised by the Company	Remark
				December 31, 2024	December 31, 2023	Shares	Percentage	Carrying value
The Company	REEI	USA	Sales of rectifiers, etc. Electronic components	142,264	142,264	205,000	100.00%	5,924	(9,754)	(9,754)
The Company	Rectron China	Hong Kong	Sales of rectifiers, etc. Electronic components	282,573	607,273	20,000	100.00%	78,634	29,121	30,179	note
The Company	CHU-TING	Taiwan	Wholesale of tobacco and alcohol products and manufacturing and sales of medical equipment.	109,987	109,987	14,500,000	100.00%	154,133	2,258	2,258

Note: Zhejiang Rectron completed the capital reduction business registration on November 15, 2024. Therefore, the capital reduction amount of $327,850 thousand (USD 10,000 thousand) was recorded under "Other Payables – Related Parties" as of December 31, 2024, and was remitted back to the Company on January 2, 2025. Subsequently, it will be submitted to the Investment Commission of the Ministry of Economic Affairs for approval.

(c) Information on investment in Mainland China:

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

(Amounts in Thousands of New Taiwan Dollar)

Investee	Main businesses and products	Total amount of paid-in capital	Method of investment	Accumulated outflow of investment from Taiwan as of January 1, 2024	Inves	tment	Accumulated outflow of investment from Taiwan as of December 31, 2024	Net income (losses) of the investee	Percentage of ownership	Investment income (loss) recognized	Carrying value as of December 31, 2024	Accumulated inward remittance of earnings as of December 31, 2024
					Outflow	Inflow
Zhejiang Rectron	Manufacturing and sales of rectifiers and other electronic components.	64,940 USD2,000	NOTE 1(3)	409,029 USD12,000	-	-	409,029 USD12,000	35,929	100.00%	35,929	(10,455)	-

(ii) Upper limit on investment in Mainland China:

(Amounts in Thousands of New Taiwan Dollar)

Accumulated investment in Mainland China as of December 31, 2024	Investment amount authorized by Investment Commission, MOEA	Upper limit on investment
393,420 USD 12,000	523,576 USD 15,970	1,100,422

Note 1: Investment methods are categorized into the following three types, simply indicated by their types:

(1)Direct investment in mainland China.
(2)Investment in Mainland China through a third-party company in another region (please specify the investment company in that third region).
(3)Others method.

Note 2: In the investment gains/losses recognized in this period column:

(1)If it is under preparation and there are no investment gains/losses yet, it should be noted.
(2)The basis for recognizing investment gains/losses is the financial statements audited and certified by the certified public accountant of the Taiwan parent company.
Note 3: According to the limits set forth in the "Principles for the Review of Investment or Technical Cooperation in Mainland China".
Note 4: According to the "Principles for Reviewing Investment or Technical Cooperation in Mainland China," there are limits to the amount of investment.
Note 5: Zhejiang Rectron completed the capital reduction business registration on November 15, 2024. Therefore, the capital reduction amount of $327,850 thousand (USD 10,000 thousand) was recorded under "Other Payables – Related Parties" as of December 31, 2024, and was remitted back to the Company on January 2, 2025. Subsequently, it will be submitted to the Investment Commission of the Ministry of Economic Affairs for approval.

Equity net worth × 60% = $1,834,036 thousand × 60% = $1,100,422thousand.

(iii) Significant transactions:

The significant inter-company transactions with the subsidiary in Mainland China, which were eliminated in the preparation of Parent Company Only Financial Statements, are disclosed in “Information on significant transactions”.

(d) Major shareholders

(Continued)

Unit: Share

		Unit: S
Shareholding Shareholder’s Name	Shares	Percentage
Juiye EnterpriseCo.,Ltd.	42,788,288	25.72%
Bigwig Perfect International Co., Ltd.	38,141,792	22.93%

Note: The shareholder information in this table is provided by the Taiwan Depository & Clearing Corporation (TDCC) and is based on the calculation of the total number of common shares and preferred shares held by shareholders, excluding treasury shares, as of the last business day of each quarter. The data includes shareholders whose holdings account for more than 5% of the total shares outstanding. Please note that there may be differences between the reported share capital in the company's financial statements and the actual number of shares held by shareholders, due to different calculation methods or other factors.

14. Segment information

Please refer to the consolidated financial statements for the year ended December 31, 2024.

(Continued)

Rectron Ltd.

Statement of Trade receivables For the year ended December 31, 2024 (Expressed in thousands of New Taiwan Dollars)

Client A customer B customer C customer D customer Others Loss allowance	Summary Payment for goods 〃〃〃	Amount $ 29,558 24,862 12,014 11,983 25,876 (57) $ 104,236	Note
			The balance of each account does not reach 5% of this account category.

Please refer to Note6(c) for more information.

Statement of Other receivables due from related parties For the year ended December 31, 2024 (Expressed in thousands of New Taiwan Dollars)

Please refer to Note7 for more information.

(Continued)

Rectron Ltd.

Statement of Changes in Investments Accounted for Using the Equity Method For the year ended December 31, 2024

(Expressed in thousands of New Taiwan Dollars)

Begining balance Shares Amoun t 205,000 16,604 20,000 388,149 14,500,000 156,875 561,628	Addition Share s Amoun t 959 Note1 31,841 Note3 2,258 Note5 35,058	Decrease Share s Amoun t 11,639 Note2 341,356 Note4 5,000 Note6 357,995	Ending balance	Ending balance	Market value or net assets value Unit price Amount 33.02 6,769 4,543 90,855 10.63 154,133 251,757	Collateral
Shares	Share s	Share s	Shares	Amoun t	Unit price 33.02 4,543 10.63
205,000 20,000 14,500,000			205,000 20,000 14,500,000	5,924 78,634 154,133		None None None
				238,691

Note1 Foreign currency translation adjustment of $959 thousand.

Note2 Investment income of $9,754 thousand and deferred credit from intercompany profits of $1,885 thousand recognized under the equity method.

Note3 Recognition of investment income totaling $30,179 thousand dollars under the equity method, along with realized gains of $1,662 thousand dollars from asset disposals.

Note4 Foreign currency translation adjustment of $27,998 thousand , the subsidiary reduced its capital by $324,700 thousand and deferred credit from intercompany profits of $545 thousand recognized under the equity method. Note5 Investment income of $2,258 thousand dollars under the equity method.

Note6 Recognition of cash dividends received amounting to 5,000 thousand dollars under the equity method.

(Continued)

Rectron Ltd.

Statement of Changes in Property, Plant and Equipment For the year ended December 31, 2024 (Expressed in thousands of New Taiwan Dollars)

Please refer to Note6(f) for more information.

Statement of Changes in Investments accounted for using equity method

Please refer to Note6(h) for more information.

(Continued)

Rectron Ltd.

Statement of Operating Revenue For the year ended December 31, 2024 (Expressed in thousands of New Taiwan Dollars)

	Item Diode Division Rectifier Division Less: Sales returns and allowances subtotal Property Management Division Rent revenue Total	Quantity 1,022,197KPCS	Amount $ 621,504 (16,250) 605,254 23,217 $ 628,471	Note

(Continued)

Rectron Ltd.

Statement of Operating Costs For the year ended December 31, 2024 (Expressed in thousands of New Taiwan Dollars)

Item Diode Division Raw material Rawmaterial,January1 Add: Purchase Less: Sale of raw materials Less: Others Less: Ending materials inventory and materials in transit Direct material consumption Direct labor Manufacturing overhead Manufacturing cost Add: Beginning work in process Transferred to finished goods Purchased work in process Ending work in process Cost of finished goods Add: Beginning finished goods Purchased finished goods Less: Ending finished goods and goods in transit Transferred to work in process Transferred to research and development department expenses or others Cost of goods sold for finished goods Cost of goods produced and sold Sale of raw materials Other cost of goods sold Revenue from sale of scraps and waste materials Lease costs (Note)	Description	Amount
		$ 2,568 25,307 (993) 19 (3,238)
		23,663 8,072 24,613
		56,348 2,462 5,775 6,370 (6,903)
		64,052 53,909 364,554 (37,751) (5,775) (1,107)
		437,882
		437,882
		993 1,847 (1,038) 8,149
		$447,833

Note: Lease costs include depreciation of $6,521 thousand.

(Continued)

Rectron Ltd.

Statement of manufacturing overhead For the year ended December 31, 2024 (Expressed in thousands of New Taiwan Dollars)

Item Salary and wages expenses Utilities Depreciation Insurance expense Material costs Outsourcing fees Other expenses Total	Description	Amount 2,658 $2,936 8,542 1,396 2,288 3,299 3,494 24,613	Note

Statement of Selling Expenses

Item Salary and wages expenses Commission expense Freight Repair and maintenance expense Service fees Other expenses Expected credit losses Total	Selling Expenses 5,195 5,897 5,548 - - 1,887 18,527	Administra tive Expenses 20,604 13 6,628 3,479 19,845 50,569	Research and development expenses 180 83 1,001	Expected credit losses Total 25,979 5,897 5,561 6,628 3,479 21,815 30 30 30 69,389

(Continued)

AI assistant

RECTRON — Annual Report 2024

51998_rns_2024-12-23_16491bc1-4dc7-405c-a180-e482ae83fe83.pdf

Rectron Ltd.

Parent Company Only Financial Statements

Table of contents

Independent Auditors’ Report

Opinion

Basis of Audit Opinion

Key audit matters

Other Matters

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Auditor’s Responsibilities for the Audit of the Non-Consolidated Financial Statements

KPMG

Notes to Readers

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese.)

Rectron LTD.

Balance Sheets

December 31,2024 and 2023 (Expressed in Thousands of New Taiwan Dollar)

Rectron LTD.

Statement of Comprehensive Income

For the Years Ended December 31, 2024 and 2023 (Expressed in Thousands of New Taiwan Dollar, except for Earnings per Common Share)

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese.)

Rectron LTD.

Statement of Changes in Equity

Rectron LTD.

Statement of Cash Flows

For the Years Ended December 31, 2024 and 2023 (Expressed in Thousands of New Taiwan Dollars)

Rectron Ltd.

Notes to the Financial Statements

December 31, 2024 and 2023

(Expressed in Thousands of New Taiwan Dollar, except for Earnings per Share Information and Unless Otherwise Specified)

1. Company history

2. Approval date and procedures of the Parent Company Only Financial Statements

3. New standards and interpretations not yet adopted

4. Summary of significant accounting policies

(a) Statement of compliance

(b) Basis of consolidation

(g) Inventories

(h) Subsidiaries

(i) Investment property

(ii)As a lessor

(iii) Short-term employee benefits

(q) Operating segments

5. Significant accounting assumptions and judgments, and major sources of estimation uncertainty

(b)Inventory evaluation

6. Explanation of significant accounts

(c) Trade receivables and notes receivable

1. Subsidiaries

2. Pledge to secure

(g) Right-of-use assets

(h) Investment property

Land and

(i) Short-term borrowings

(j)Operating Lease

Lease as Lessor

(k) Provisions

1. Defined benefit plans

1) Composition of plan assets

2) Movements in present value of the defined benefit obligations

3) Movements on the defined benefit plan assets

4) Expenses recognized in profit and loss

5) Remeasurement of net defined benefit liability (asset) recognized in other comprehensive income

6) Actuarial assumptions

7) Sensitivity analysis

2. Defined contribute on plans

(l) Income tax

1) Unrecognized deferred tax assets

2) Recognized deferred tax assets and liabilities

1) Legal reserve

2) Special reserve

(n) Earnings per share

2. Diluted earnings per share

(o) Revenue from contracts with customers

1. Disaggregation of revenue

For the Years Ended December 31, 2024

2. Contract balances

(p) Remunerations to employees, directors and supervisors

(q) Non-operating income and expenses

(r)Financial instruments

RECTRON Annual Report 2024