SAMPO — Audit Report / Information 2021

Nov 12, 2021

Stock No: 1604

SAMPO CORPORATION

Individual Financial Statements and Independent Auditor’s Report 2021 and 2020

Address: No.26-3, Dinghu Rd., Gueishan Dist., Taoyuan City TEL: (03) 397-5151

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§Table of Contents§

Item 1. Cover page 2. Table of Contents 3. Independent Auditor’s Report 4. Individual Balance Sheet 5. Individual Income Statement 6. Individual Statements of Changes in Shareholders’ Equity 7. Individual Statements of Cash Flow 8. Individual Notes to financial statements (1) Company History (2) Financial reporting date and procedures (3) Application of new and revised standards and interpretation (4) Summary of significant accounting policies (5) Main source of significant accounting judgment, estimates and assumptions uncertainty (6) Summary of significant accounting titles (7) Related party transaction (8) Pledged assets (9) Significant contingent liabilities and unrecognized contractual commitments (10) Significant disaster loss (11) Significant subsequent events (12) Others (13) Notes of disclosure 1. Information about important transactions 2. Information regarding investees 3. Information regarding investment in the territory of mainland china 4. Information on Dominant Shareholders (14) Segment information 9. Significant accounting items	Page 1 2 3~6 7 8~9 10 11~13 14 14 14~18 18~31 31 31~62 63~65 65 65~67 - - 67~68 68, 70~73, 76 68, 74 68~69, 75~76 77 - 78~95	Notes to financial statements No.
		- - - - - - - 1 2 3 4 5 6~25 26 27 28 - - 29~30 31 - -

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Independent Auditor’s Report

To SAMPO CORPORATION:

Auditor’s opinions

We have audited the individual balance sheet of SAMPO CORPORATION as of December 31, 2021 and 2020, and the individual comprehensive income statements, individual statement of changes in shareholders’ equity, individual statements of cash flows, and notes to the individual financial statements (including significant accounting policies) for the years then ended.

In our opinion, the individual financial statements referred to above present fairly, in all material respects, the individual financial position of SAMPO CORPORATION as of December 31, 2021 and 2020, and its individual financial performance and cash flows for the years ended December 31, 2021 and 2020, in conformity with the requirements of regulations governing the preparation of financial statements by securities issuers.

Basis of an audit opinion

We conducted our audit in accordance with the “Rules Governing Auditing and Certification of Financial Statements by Certified Public Accounts” and generally accepted auditing standards. Our responsibilities under those standards are further described in the responsibilities of auditors for the audit of the separate financial statements. We are independent of SAMPO CORPORATION in accordance with the Code of Professional Ethics for Certified Public Accountants, and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that our audit provides a reasonable basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the 2021 individual financial statements of SAMPO CORPORATION. These matters were addressed in the content of our audit of the individual financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on those matters.

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Key audit matters of the 2021 individual financial statements of SAMPO CORPORATION are as follows:

Key Audit Matter: Authenticity of sales to hypermarket channels

For 2021, SAMPO CORPORATION’s revenues from sales to major hypermarkets is a key indicator used by management to evaluate business performance, and the effect of the recognition of related revenues on the financial statements is material. Therefore, we have determined that the recognition of the aforementioned operating revenues is a key audit matter and the related accounting policies are described in Note 4(14) to the individual financial statements.

Our auditing procedures with respect to the above matter are as follows:

1. Understood, evaluated and tested the effectiveness of the design and implementation of the internal control system related to revenue recognition.

2. In order to confirm the authenticity of the revenue, we obtained the sales revenue details of the hypermarket channel in 2021, sampled and verified original sales orders, shipping documents and invoices of the relevant transactions, and reconciled them with the recorded amounts in the accounting books.

3. Obtained the details of sales returns and discounts for the subsequent period from the hypermarket channel, sampled and verified the relevant certificates of sales returns and discounts, and examined the reasonableness of the returns and discounts.

Responsibilities of Management and Those in Charge of Governance of the Individual Financial Statements

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

In preparing the individual financial statements, the management is also responsible for assessing the ability of SAMPO CORPORATION as a going concern, disclosing as applicable, matters related to a going concern and using the going concern basis of accounting. Unless the management either intends to liquidate SAMPO CORPORATION or to cease operations, or has no other realistic alternative but to do so.

Those in charge of governance (including the Auditing Committee) are responsible for overseeing the reporting process of the financial statements of SAMPO CORPORATION.

Auditor’s Responsibilities for the Audit of the Individual Financial Statements

Our objectives are to obtain reasonable assurance about whether the individual financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue and auditor’s report. Reasonable assurance is a high level of assurance, but is not a guarantee that and audit conducted in accordance with the accounting principles generally accepted in the Republic of China will always detect a material misstatement when it exists. Material misstatement could arise from fraud or errors. If fraud or errors are considered materials, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these individual financial statements.

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The independent auditors when conducting the audit in accordance with generally accepted auditing standards shall exercise professional judgment and maintain professional suspicion. The independent auditors also perform the following tasks:

1. Identify and assess the risks of material misstatement of the individual financial statements, whether due to fraud or error, design, and perform audit procedures responsive risks, and obtain evidence that is sufficient and appropriate to provide a basis of our opinion. Fraud may involve conspiracy, forgery, deliberate omission, false declaration, or violation of internal control; therefore, the risk of material misstatement arising from fraud is higher than that caused by error.

2. 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 internal control effective in SAMPO CORPORATION.

3. Assess the appropriateness of the accounting policies adopted by the management and the reasonableness of the accounting estimates and related disclosures made.

4. Conclude the appropriateness of the use of the going concern basis of accounting by the management, and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on SAMPO CORPORATION to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the individual financial statements or, if such disclosures are inappropriate, to modify our opinion. The conclusion of the independent auditors is based on the audit evidence obtained as of the audit report date. However, future events or conditions may cause SAMPO CORPORATION to cease as a going concern.

5. Evaluate the overall presentation, structure, and content of the individual statements, including related notes, whether the individual statements represent the underlying transactions and events in a matter that achieves fair presentation.

6. Obtain sufficient and appropriate audit evidence on the financial information of business entities within SAMPO CORPORATION in order to express an opinion on the individual financial statements. The independent auditor is responsible for guiding, supervising, and implementing the audit and also is responsible for forming an opinion on the audit of SAMPO CORPORATION.

We communicate with those in charge of 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 in charge of 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).

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From the matters communicated with those in charge of governance, we determine those matters that were of most significance in the audit of the 2021 individual financial statements of SAMPO CORPORATION and are therefore the key audit matters. The independent auditors shall state the key audit matters in the audit report except for the specific matters prohibited from being disclosed by law and regulations, or, in rare cases, where the independent auditor decides not to have specific matters communicated in the audit report since the negative effect of such disclosure can be reasonably expected to be greater than the increase of public interest.

Deloitte and Touche Taiwan CPA Su-Huan Yu CPA: Yi-Hui Lin Securities and Futures Bureau Approval Financial Supervisory Commission approval Document No. no. Tai-Cai-Zheng (6) Zi No. 0920123784 Jin-kwong-cheng-(6) No.: 0940161384

March 22, 2022

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SAMPO CORPORATION

Individual Balance Sheet

December 31, 2021 and 2020

Unit: NT$ thousand

Code 1100 1136 1150 1160 1170 1180 1200 1210 1220 130X 1479 11XX 1517 1550 1600 1755 1780 1840 1990 15XX 1XXX Code 2100 2110 2150 2170 2180 2230 2209 2219 2250 2280 2320 2399 21XX 2540 2550 2570 2580 2640 2670 25XX 2XXX 3110 3200 3310 3320 3350 3300 3400 3500 3XXX	Assets Current assets Cash and cash equivalents (Note 6) Financial assets at amortized cost – current (Note 8) Notes receivable (Note 9) Notes receivable – related parties, net (Notes 9 and 26) Accounts receivable (Note 9) Accounts receivable – related parties, net (Notes 9 and 26) Other receivables (Note 9) Other receivables – related parties, net (Notes 9 and 26) Current tax assets (Note 22) Inventory (Note 10) Other current assets (Note 14 and 26) Total current assets Non-current assets Financial assets measured at fair value through other comprehensive income – non-current (Note 7) Investments accounted for using the equity method (Note 11) Property, plant and equipment (Note 12) Right-of-use assets (Note 13) Intangible assets Deferred tax assets (Note 22) Other non-current assets (Note 14) Total non-current assets Total assets Liabilities and equity Current liabilities Short-term borrowings (Note 15) Short-term bills payable (Note 15) Notes payable Accounts payable Accounts payable – related parties (Note 26) Current tax liabilities (Note 22) Other payables (Note 16) Other payables – related parties (Note 26) Provisions for liabilities – current (Note 17) Lease liabilities – current (Note 13) Long-term loans due within one year or one business cycle (Note 15) Other current liabilities (Note 16) Total current liabilities Non-current liabilities Long-term borrowings (Note 15) Provisions for liabilities – non-current (Note 17) Deferred tax liabilities (Note 22) Lease liabilities – non-current (Note 13) Defined benefit liabilities – non-current (Note 18) Other non-current liabilities (Note 16) Total non-current liabilities Total liabilities Equity (Note 19) Capital stock Common stock capital Additional paid-in capital Retained earnings Statutory reserves Special reserve undistributed earnings Total retained earnings Other equity Treasury shares Total equity Total Liabilities and Equity		December 31, 2021	December 31, 2021	% 1 - 2 - 5 - - - - 10 3 21 4 38 35 - 1 1 - 79 100 1 1 - 4 1 - 5 - 1 - 1 4 18 3 1 5 - 3 - 12 30 33 2 6 14 25 45 2) 8) 70 100		December 31, 2020	December 31, 2020
			Amount $ 172,623 - 196,216 6,801 597,684 448 10,404 6,763 - 1,219,941 295,371 2,506,251 469,365 4,480,487 4,074,916 29,538 58,251 160,457 11,290 9,284,304 $ 11,790,555 $ 150,000 99,974 49,748 473,858 115,435 30,915 583,222 15,604 89,575 14,387 60,000 406,566 2,089,284 290,000 108,663 641,407 15,730 327,700 30,809 1,414,309 3,503,593 3,872,000 213,725 663,802 1,660,366 2,955,104 5,279,272 221,843) 856,192) 8,286,962 $ 11,790,555				Amount $ 431,790 217,907 110,406 - 261,533 437 11,417 4,437 490 1,079,490 406,870 2,524,777 418,903 4,329,208 4,020,496 51,344 66,975 155,823 12,865 9,055,614 $ 11,580,391 $ - - 135,551 480,236 120,473 74,251 363,344 11,693 72,845 62,322 - 325,725 1,646,440 900,000 106,481 729,313 27,615 368,389 36,856 2,168,654 3,815,094 3,872,000 171,699 485,157 1,592,788 2,379,146 4,457,091 142,666) 592,827) 7,765,297 $ 11,580,391		%
		( (		( (		( (		( (	4 2 1 - 2 - - - - 9 4 22 4 37 35 - 1 1 - 78 100 - - 1 4 1 1 3 - 1 - - 3 14 8 1 6 - 3 1 19 33 33 1 4 14 21 39 1) 5) 67 100

The notes attached shall constitute an integral part of this individual financial statement.

Chairman: CHEN, MAO-BANG INDUSTRIAL DEVELOPMENT FOUNDATION Managerial officer: HSU, CHING-CHAO Accounting officer: CHIANG, CHUAN-TIEN INDUSTRIAL DEVELOPMENT FOUNDATION

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SAMPO CORPORATION

Individual Comprehensive Income Statement

January 1 to December 31, 2021 and 2020

Unit: NTD thousand, except Earnings Per Share (NTD)

Code Operating revenues (Note 20) 4100 Sales revenues 4600 Service revenues 4800 Other operating revenues 4000 Total operating revenues 5000 Operating costs (Note 10) 5900 Gross profits Operating expenses (Note 21 and 26) 6100 Marketing expenses 6200 Administrative expenses 6300 Research and development expenses 6450 Expected credit impairment loss (gain on reversal) 6000 Total operating expenses 6900 Net Operating profits Non-operating income and expenses 7100 Interest income (Note 21) 7010 Other income (Note 21) 7020 Other gains and losses (Note 21) 7050 Financial costs 7070 Share of subsidiaries, affiliates and joint ventures accounted for using the equity method 7000 Total non-operating income and expenses		2021		% 97 3 - 100 79 21 9 6 1 - 16 5 - 1 15 - 3 19		2020
		Amount $ 7,061,155 236,838 20,586 7,318,579 5,789,726 1,528,853 637,803 410,346 89,658 13,469 1,151,276 377,577 869 82,080 1,046,982 9,453 ) 225,226 1,345,704				Amount $ 6,249,376 234,822 22,961 6,507,159 5,163,076 1,344,083 563,738 380,290 77,433 1,841 1,023,302 320,781 7,651 63,598 1,331,786 21,007 ) 306,741 1,688,769		%
	(				(			96 4 - 100 79 21 9 6 1 - 16 5 - 1 20 - 5 26

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Code 7900 Profit before tax 7950 Income tax expense (Note 22) 8200 Net profits of the current year Other comprehensive income 8310 Items not to be reclassified as profit or loss: 8311 Remeasurement of defined benefit plan 8316 Unrealized valuation gains or losses of equity instruments investments in financial assets measured at FVTOCI 8330 Share of other comprehensive income of subsidiaries, affiliates and joint ventures accounted for under equity method 8360 Items that may be reclassified subsequently under profit or loss 8380 Share of other comprehensive income of subsidiaries, affiliates and joint ventures accounted for under equity method 8300 Other comprehensive income of the current year (net amount after taxation) 8500 Total amount of comprehensive income of the current year Earnings per share (Note 23) 9750 Basic 9850 Diluted		2021		% 24 1) 23 - - - - - - 23		2020
		Amount $ 1,723,281 54,950) 1,668,331 1,721 ) 13,947 34,228 46,454 16,031) 30,423 $ 1,698,754 $ 4.52 $ 4.49				Amount $ 2,009,550 213,557) 1,795,993 10,208 ) 96,322 ) 95,658 10,872) 29,136 18,264 $ 1,814,257 $ 4.86 $ 4.82		%
	( ( (		(		( ( ( (		( (	31 3) 28 - 1 ) 1 - - - 28

The notes attached shall constitute an integral part of this individual financial statement.

Chairman: CHEN, MAO-BANG INDUSTRIAL Managerial officer: HSU, Accounting officer: DEVELOPMENT FOUNDATION CHING-CHAO CHIANG, CHUAN-TIEN INDUSTRIAL DEVELOPMENT FOUNDATION

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SAMPO CORPORATION

Individual Statements of Changes in Shareholders’ Equity

January 1 to December 31, 2021 and 2020

Unit: NT$ thousand

Code A1 Balance as of January 1, 2020 Distribution of 2019 earnings B1 Legal reserve B5 Cash dividend to the Company’s shareholders B17 Reversal of special reserve C7 Changes in affiliates and joint ventures recognized under the equity method D1 Net profits for 2020 D3 Other comprehensive profit and loss after tax in 2020 D5 Total profit and loss in 2020 L1 Purchase and disposal of treasury shares M1 Adjustment of capital surplus by dividends paid to subsidiaries M5 The differences between carrying amount and market price of actual acquisition or disposal of shares in subsidiaries. Z1 Balance as of December 31, 2020 Distribution of 2020 earnings B1 Legal reserve B3 Provision for special reserve in accordance B5 Cash dividend to the Company’s shareholders B17 Reversal of special reserve C7 Changes in affiliates and joint ventures recognized under the equity method D1 Net profits for 2021 D3 Other comprehensive income after tax in 2021 D5 Total profit and loss in 2021 L1 Purchase and disposal of treasury shares M1 Adjustment of capital surplus by dividends paid to subsidiaries Q1 Disposal of equity instruments that are measured at fair value through other comprehensive profit and loss by the associates under the equity method Z1 Balance as of December 31, 2021							Equity attributable to shareholders of the company	Equity attributable to shareholders of the company	Equity attributable to shareholders of the company	Equity attributable to shareholders of the company						Total $ 6,485,335 - 570,600 ) - 752 1,795,993 18,264 1,814,257 19,650 15,882 21 7,765,297 - - 955,750 ) - 2,533 ) 1,668,331 30,423 1,698,754 245,277 ) 26,471 - $ 8,286,962		Total equity
	Capital	stock Capital stock $ 3,872,000 - - - - - - - - - - 3,872,000 - - - - - - - - - - - $ 3,872,000		Capital surplus $ 151,374 - - - 752 - - - 3,670 15,882 21 171,699 - - - - 2,533 ) - - - 18,088 26,471 - $ 213,725			Retained earnings			Unappropriated earnings $ 1,141,276 73,896 ) 570,600 ) 95,918 - 1,795,993 9,545) 1,786,448 - - - 2,379,146 178,645 ) 212,402 ) 955,750 ) 144,824 - 1,668,331 4,068) 1,664,263 - - 113,668 $ 2,955,104	Other equity Exchange differences on translation of financial statements of foreign operations Unrealized gain or loss on financial assets measured at fair value through other comprehensive income ( $ 305,398 ) $ 134,923 - - - - - - - - - - 29,136 ( 1,327) 29,136 ( 1,327) - - - - - - ( 276,262 ) 133,596 - - - - - - - - - - - - ( 16,031) 50,522 ( 16,031) 50,522 - - - - - ( 113,668) ($ 292,293) $ 70,450			Treasury shares $ 608,807 ) - - - - - - - 15,980 - - 592,827 ) - - - - - - - - 263,365 ) - - $ 856,192)
											Exchange differences on translation of financial statements of foreign operations ( $ 305,398 ) - - - - - 29,136 29,136 - - - ( 276,262 ) - - - - - - ( 16,031) ( 16,031) - - - ($ 292,293)
	Number of Shares 387,200,000 - - - - - - - - - - 387,200,000 - - - - - - - - - - - 387,200,000					Legal reserve $ 411,261 73,896 - - - - - - - - - 485,157 178,645 - - - - - - - - - - $ 663,802		Special reserve $ 1,688,706 - - 95,918 ) - - - - - - - 1,592,788 - 212,402 - 144,824 ) - - - - - - - $ 1,660,366
			(				( (		( ( ( ( ( ( (		( ( ( ( (	( ( (	( ( ( (		( ( ( (		( ( ( (	$ 6,485,335 - 570,600 ) - 752 1,795,993 18,264 1,814,257 19,650 15,882 21 7,765,297 - - 955,750 ) - 2,533 ) 1,668,331 30,423 1,698,754 245,277 ) 26,471 - $ 8,286,962

The notes attached shall constitute an integral part of this individual financial statement.

Chairman: CHEN, MAO-BANG INDUSTRIAL DEVELOPMENT FOUNDATION INDUSTRIAL DEVELOPMENT FOUNDATION

Managerial officer: HSU, CHING-CHAO Accounting officer: CHIANG, CHUAN-TIEN

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SAMPO CORPORATION

Individual Statements of Cash Flow

January 1 to December 31, 2021 and 2020

Unit: NT$ thousand

Code Cash flow from operating activities A10000 Current year net profit before taxation A20010 Profits and loss A20100 depreciation expense A20200 Amortization expenses A29900 Expected credit impairment loss A20900 Financial costs A21200 Interest income A21300 Dividend income A22400 Share of profit or loss of subsidiaries, affiliates and joint ventures accounted for using the equity method A22500 Gain on disposal of property, plant and equipment A23700 Loss on decline in value of inventories and slow moving (gain on reversal) A22800 Lease modification gain A30000 Net change in operating assets and liabilities A31130 Notes receivable A31140 Notes receivable – related party A31150 Accounts receivable A31160 Accounts receivable – related parties A31180 Other receivables A31190 Other receivables – related parties A31200 Inventory A31240 Other current assets A32130 Notes payable A32140 Notes payable – related party A32150 Accounts payable A32160 Accounts payable – related parties A32180 Other payables A32190 Other payables – related parties A32200 Provision for liabilities A32230 Other current liabilities A32240 Net defined benefit liability A33000 Cash generated from operating activities		2021 $ 1,723,281 94,428 38,626 13,469 9,453 869 ) 10,337 ) 225,226 ) 1,068,507 ) 4,382 23 ) 88,922 ) 7,048 ) 344,239 ) 11 ) 965 2,326 ) 144,833 ) 99,168 85,803 ) - 6,350 ) 5,038 ) 187,968 3,911 18,912 80,841 42,410) 243,462		2020
	( ( ( ( ( ( ( ( ( ( ( ( ( ( (		( ( ( ( ( ( ( ( ( ( ( ( ( ( ( (	$ 2,009,550 72,353 39,545 1,841 21,007 7,651 ) 7,738 ) 306,741 ) 1,371,915 ) 9,209 ) 92 ) 5,696 ) 12 6,887 ) 196 ) 1,858 ) 12,848 145,550 151,064 ) 27,859 ) 68,267 ) 174,655 91,821 67,322 61 ) 3,347 14,732 ) 37,620) 622,265

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Code A33100 Interest received A33300 Interest payment A33500 Income tax payment AAAA Net cash inflow from operating activities Cash flow from investment activities B00010 Acquisition of financial assets at fair value through other comprehensive profit or loss B00030 Refund from capital reduction in financial assets measured at fair value through other comprehensive profit and loss B00040 Acquisition of financial assets measured at amortized cost B00050 Financial assets on the basis of cost after amortization B01800 Acquisition of investment accounted for using the equity method B02700 Purchase of property, plant, and equipment B02800 Proceeds from disposal of property, plant and equipment B03700 Decrease in Refundable deposits B04500 Purchase of intangible assets B06800 Decrease in other non-current assets B07600 Receipt of dividends from subsidiaries, affiliates and joint ventures B07600 Receipt of other dividends BBBB Net cash inflow from investment activities Cash flow from financing activities C00200 Increase (decrease) in short-term borrowings C00500 Increase (decrease) in short-term bills payable C01600 Borrowing of long-term loans C01700 Repayments of long-term borrowings C03000 Increase in deposits received C04300 Decrease in other non-current liabilities C04500 Payment of dividends C04900 Repurchase cost of treasury stock C05100 Treasury stock purchased by employees C04020 Lease principal repayment CCCC Net cash outflow from financing activities DDDD Impact of changes in exchange rate on cash and cash equivalents		2021 $ 869 9,149 ) 190,336) 44,846 50,000 ) 13,485 - 217,907 - 793,788 ) 1,782,095 23 29,902 ) 957 116,082 10,337 1,267,196 150,000 99,974 50,000 600,000 ) 1,592 7,639 ) 955,750 ) 293,727 ) 48,450 63,419) 1,570,519) 690)		2020
	( ( ( ( ( ( ( ( ( ( ( (		( ( ( ( ( ( ( ( ( ( ( ( ( (	$ 7,651 21,437 ) 246,679) 361,800 - - 38,027 ) - 206,255 ) 564,476 ) 1,792,250 34,099 23,917 ) 1,810 221,625 7,738 1,224,847 60,000 ) 489,785 ) 900,000 1,625,000 ) - 19,443 ) 570,600 ) - 19,650 26,704) 1,871,882) 614)

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Code EEEE Current cash and cash equivalents decrease E00100 Cash and cash equivalents balance – beginning of year E00200 Cash and cash equivalents balance – end of year	2021 ( $ 259,167 ) 431,790 $ 172,623	2020
		( $ 285,849 ) 717,639 $ 431,790

The notes attached shall constitute an integral part of this individual financial statement.

Chairman: CHEN, MAO-BANG Managerial officer: HSU, Accounting officer: INDUSTRIAL DEVELOPMENT CHING-CHAO CHIANG, FOUNDATION CHUAN-TIEN INDUSTRIAL DEVELOPMENT FOUNDATION

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SAMPO CORPORATION

Individual Notes to financial statements

January 1 to December 31, 2021 and 2020

(Unless otherwise provided, Unit: NTD thousand)

1. Company History

SAMPO CORPORATION. (hereinafter referred to as “SAMPO” or the “Company”), formerly known as “DONGXING ELECTRIC CO., LTD.,” was established in September 1962. In September 1964, DONGXING merged with DONJOY ELECTRIC CO., LTD. and changed its name to SAMPO ELECTRONICS CO., LTD. In 1970, its stock was publicly traded, and in 1974, the name was changed to SAMPO CORPORATION.

The Company engages in the manufacture, processing, contracting, wholesaling, retailing, repair services, and consignment of electronics, electrochemicals, telecommunications, electrical materials, information products, and audio products, and engages in the import and export business and investment in foreign related businesses.

The individual financial statements are presented in the Company’s functional currency – NTD.

2. Financial reporting date and procedures

The individual financial statements were approved by the Board of Directors on March 22, 2022.

3. Application of new and revised standards and interpretation

• (1) First-time application of International Financial Reporting Standards (“IFRSs”), International Accounting Standards (“IASs”), Interpretations (“IFRICs” and “SICs”) (hereinafter collectively referred to as the “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (hereinafter referred to as the “FSC”).

The application of the amended IFRSs approved and announced with effect by the Financial Supervisory Commission would not cause significant changes to the Company’s accounting policies.

• (2) The applicable FSC-approved IFRSs in 2022

Company’s accounting policies. The applicable FSC-approved IFRSs in 2022
The new/amended/revised standards or interpretation “IFRSs 2018-2020 Annual Improvements” Amendments to IFRS 3 “Definition of a Business” Amendment to IAS 16 “Property, plant and equipment: price before reaching the intended state of use” Amendment to IAS 37 “Onerous Contracts – Cost of Performing Contracts.”	Effective Date per IASB publication
	January 1, 2022 (Note 1) January 1, 2022 (Note 2) January 1, 2022 (Note 3) January 1, 2022 (Note 4)

• Note 1: The amendment to IFRS 9 applies to swaps or changes in the terms of financial liabilities that occur in annual reporting periods beginning after January 1, 2022; the amendment to IAS 41, “Agriculture,” applies to fair

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value measurements in annual reporting periods beginning after January 1, 2022; and the amendment to IFRS 1, “First-time Adoption of IFRSs,” applies retrospectively to annual reporting periods beginning after January 1, 2022.

• Note 2: This amendment applies to business mergers for which the acquisition date falls within the annual reporting period after January 1, 2022.

• Note 3: This amendment applies to plant, property and equipment that begins to operate in the manner such as location and condition expected by management after January 1, 2021.

• Note 4: This amendment applies to contracts with unfulfilled obligations as of January 1, 2022.

As of the date of publication of this financial report, the Company has evaluated that the amendments to the above standards and interpretations will not have a material impact on the financial position and financial performance.

• (3) The IFRSs released by the IASB but not yet approved and announcement effective by the Financial Supervisory Commission

The IFRSs released by the IASB but not yet approved by the Financial Supervisory Commission	and announcement effective
The new/amended/revised standards or interpretation Amendment to IFRS 10 and IAS 28, “Sale or Contribution of Assets between an Investor and its Affiliate or Joint Venture and Investment in Affiliates.” IFRS 17 “Insurance Contracts” Amendment to IFRS 17 Amendment to IFRS 17 “First-time application of IFRS 17 and IFRS 9 - Comparative Information” Amendment to IAS 1 “Classification of Liabilities as Current or Noncurrent” Amendment to IAS 1 “Disclosure of Accounting Policies.” Amendment to IAS 8 “Definition of Accounting Estimates.” Amendments to IAS 12 “deferred tax related to assets and liabilities arising from a single transaction” Amendment to IFRS 10 and IAS 28, “Sale or Contribution of Assets between an Investor and its Affiliate or Joint Venture and Investment in Affiliates.” IFRS 17 “Insurance Contracts”	IASB publication effective date (Note 1)
	Undefined January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 (Note 2) January 1, 2023 (Note 3) January 1, 2023 (Note 4) Undefined January 1, 2023

• Note 1: Unless otherwise stated, the aforementioned new/amended/revised standards or interpretation are effective for annual reporting periods beginning after the respective dates.

• Note 2: The application of this amendment is deferred for annual reporting periods beginning after January 1, 2023

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• Note 3: This amendment applies to changes in accounting estimates and changes in accounting policies that occur in annual reporting periods beginning after January 1, 2023.

• Note 4: The amendments are applicable to transactions occurred after January 1, 2022, except for the deferred income tax recognized on the temporary differences of lease and decommissioning obligations on January 1, 2022.

• Amendment to IAS 1 “Classification of Liabilities as Current or Noncurrent”

The amendment aims to clarify whether a liability is classified as noncurrent; the Company should assess whether it has the right to defer settlement at the end of the reporting period for at least 12 months after the reporting period. If the Company has such a right as of the end of the reporting period, the liability is classified as noncurrent whether or not the Company exercises its right to defer settlement of a liability. The amendment aims to clarify if the Company is required to comply with certain conditions in order to have the right to defer settlement of a liability. The Company must have complied with specific conditions as of the end of the reporting period, even if the lender tests whether the Company has complied with those conditions at a later date.

The amendment provides the purpose to clarify that settlement refers to the transfer to the counterparty of cash, other economic resources or equity instruments of the Company that results in the extinguishment of the liability. However, if the terms of the liability may result in transferring the Company’s equity instruments at the option of the counterparty, and if the option is separately recognized in equity in accordance with IAS 32, “Financial Instruments: Presentation,” the above-mentioned provisions do not affect the classification of the liability.

1. Amendment to IAS 1 “Disclosure of Accounting Policies.”

The amendment specifies that the Company shall determine the material accounting policy information to be disclosed based on the definition of materiality. Accounting policy information is considered material if it could reasonably be expected to affect the decisions of the primary users of the general-purpose financial statements based on those financial statements. The amendment also clarifies:

• ˙ Accounting policy information related to immaterial transactions, other events or circumstances is immaterial and the Company is not required to disclose such information.

• ˙ The Company may determine that related accounting policy information is material because of the nature of the transactions, other events or circumstances, even if the amount is not material.

• ˙ Not all accounting policy information related to significant transactions, other events or circumstances is material.

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In addition, the amendment provides examples of accounting policy information that may be material if it relates to significant transactions, other events or circumstances and under the following circumstances, the information may be material:

• (1) A change in the Company’s accounting policy during the reporting period that results in a material change in financial statement information;

• (2) The Company selects applicable accounting policies from among the options permitted by the standards.

• (3) Due to the lack of specific standards, the Company establishes accounting policies in accordance with IAS 8 “Accounting Policies, Changes and Errors in Accounting Estimates”;

• (4) The Company discloses the relevant accounting policies that require the application of significant judgments or assumptions; or

• (5) that it involves complex accounting requirements when users of financial statements rely on such information to understand such significant transactions, other events or circumstances.

• Amendment to IAS 8 “Definition of Accounting Estimates.”

The amendment explicitly specifies that accounting estimate represents the monetary amounts in the financial statements that are subject to measurement uncertainty. In applying accounting policies, the Company may need to measure financial statement items using monetary amounts that are not directly observable but must be estimated, and therefore measurement techniques and input values are required to create accounting estimates for this purpose. The effect of changes in measurement techniques or input values on accounting estimates that are not corrections of prior period errors are accounted for as changes in accounting estimates.

1. Amendments to IAS 12 “deferred tax related to assets and liabilities arising from a single transaction”

According to the said amendments, the taxable income generated and deductible temporary difference transaction occurred for the same amount at the time of original recognition are not subject to the exceptions of the initial recognition as stated in IAS 12. The Company will recognize deferred income tax assets (if there is probably to have taxable income available for deducting the temporary differences) and deferred income tax liabilities for all deductible and taxable temporary difference related to lease and decommissioning obligations on January 1, 2022; also, the cumulative effect will be recognized as an adjustment to the initial balance of retained earnings in the same day. The transactions other than leases and decommissioning obligations occurred after January 1, 2022 are deferred subject to the said amendment.

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In addition to the aforementioned effects, as of the financial report publication date, the Company continued to assess the impact of the aforementioned amendments to the standards and interpretations on the financial status and financial performance. The relevant effects will be disclosed upon the completion of the assessment.

4. Summary of significant accounting policies

• (1) Compliance Statement

The individual financial statements were prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers.”

• (2) Basis of preparation

Except for the financial instruments on the basis of fair value and the recognition of net defined benefit liabilities on the basis of the present value of net defined benefit obligation net of the fair value of planned assets, this individual financial statement was compiled on the basis of historical cost.

The evaluation of fair value could be classified into Level 1 to Level 3 by the observable intensity and importance of related input value:

1. Level 1 input value: refers to the quotation of the same asset or liability in an active market as of the evaluation (before adjustment).

2. Level 2 input value: refers to the direct (the price) or indirect (inference of price) observable input value of asset or liability further to the quotation of Level 1.

3. Level 3 input value: the unobservable input value of asset or liability.

In preparing its financial statements, the Company uses the equity method to account for its investment in subsidiaries, affiliates and joint ventures. In order to make the profit or loss for the year, other comprehensive income and equity in the individual financial statements the same as the profit or loss for the year, other comprehensive income and equity attributable to the owners of the Company in the consolidated financial statements, certain accounting differences between the stand-alone basis and the consolidated basis are adjusted for “investments accounted for using the equity method,” “share of profit or loss of subsidiaries and affiliates accounted for using the equity method,” “share of other comprehensive income and loss of subsidiaries and affiliates accounted for using the equity method” and related equity items. Other comprehensive income of subsidiaries and affiliates using the equity method” and related equity items.

• (3) Standards in differentiating current and non-current assets and liabilities.

Current assets including:

1. Assets held mainly for trading purpose:

2. Assets to be realized within 12 months after the balance sheet date; and

3. Cash and cash equivalents (not including those that are limited to exchange or repay liabilities exceeding 12 months after the balance sheet date).

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Current liabilities include:

1. Liabilities held for trading purposes;

2. The liabilities to be liquidated upon due within 12 months after the balance sheet date (those with long-term refinancing or payment term rearrangement completed from the balance sheet date to the financial reports approved and published date are also classified as current liabilities), and

3. Liabilities with the repayment deadline that cannot be unconditionally deferred to at least 12 months after the balance sheet date. Where the liabilities might be paid off at the discretion of the other party through the tools of the issuance equity, the classification would remain unaffected.

For those that are not current assets or liabilities above are classified as non-current assets or liabilities.

• (4) Foreign currency

For the transactions conducted in a currency other than the Company’s functional currency (foreign currency), it is to be translated to the functional currency in accordance with the exchange rate on the transaction date when preparing the individual financial statements.

Foreign currency monetary items are translated at the closing rate on each balance sheet date. The exchange differences arising from the settlement of monetary items or translating monetary items are recognized in the current profit or loss.

The foreign non-currency items measured at fair value are translated in accordance with the exchange rate on the fair value determination date and the exchange difference is booked as current profit or loss. However, for the changes in fair value recognized in the other comprehensive profit or loss, the exchange difference is recognized in the other comprehensive profit or loss.

The foreign non-currency items measured at historical cost are translated in accordance with the exchange rate on the transaction date without the need for a translation again.

Upon preparation of the individual financial reports, the assets and liabilities of overseas operating institutions (including the subsidiaries, affiliates and joint ventures in the countries of business operation or those using currencies different from the Company’s) were converted to NTD based on the exchange rate quoted on every balance sheet date. Income and expense items are translated in accordance with the current average exchange rates and the exchange differences are booked in the other comprehensive profit or loss.

If the Company disposes of all interests in a foreign operation, or disposes of a portion of an interest in a subsidiary of a foreign operation but loses control, or disposes of a retained interest in a joint venture or affiliate of a foreign operation that is a financial asset and is accounted for under the accounting policy for financial instruments, all cumulative translation differences related to the foreign operation are reclassified to profit or loss.

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If the partial disposal of a foreign operating subsidiary does not result in a loss of control, the accumulated exchange differences are included in equity transactions on a pro rata basis, but are not recognized in profit or loss. In any other event of partial disposal of an overseas operating institution, the accumulated difference in foreign exchange was reclassified to profit and/or loss pro rata to the percentage of disposal.

(5) Inventory

Inventory includes raw materials, supplies, finished goods and work-in-process. Inventory is valued in accordance with the lower of cost or net cash value. When comparing cost and net cash value, except for the homogeneous inventories, it is based on the itemized lower of cost or net cash value. Net realizable value refers to the estimated sale price under normal circumstances net of the estimated cost needed to complete the project and the estimated expenses needed to complete the sale. The cost of inventory is calculated using the weighted average method.

(6)

Investment in subsidiaries

The Company has the investment in subsidiaries handled in accordance with the equity method.

Subsidiaries are the entities controlled by the Company.

Under the equity method, investments were originally recognized at cost; the book value after the acquisition date fluctuates along with the distribution of profit or loss from the subsidiaries and other comprehensive profit or loss. In addition, for the changes in the affiliated company’s equity, the Company is entitled to have it recognized proportionately to the shareholding.

When the Company’s change in the ownership of the subsidiary does not result in loss of control, it is treated as an equity transaction. The difference between the book amount of the investment and the fair value of the consideration paid or received shall be directly recognized as equity.

When the Company’s share of losses in a subsidiary equals or exceeds its interest in the subsidiary (including the carrying amount of the subsidiary under the equity method and other long-term interests that are in substance a component of the Company’s net investment in the subsidiary), the Company continues to recognize losses in proportion to its equity in the subsidiary.

Acquisition costs in excess of the Company’s share of net identifiable assets and liabilities (i.e. fair value) in a subsidiaries on the date of acquisition are recognized as goodwill. This goodwill includes book value of the investment and is not amortized. Share of net identifiable assets and liabilities (i.e. fair value) in subsidiaries that exceeds acquisition cost on the date of acquisition is recognized as gains for the current year.

In assessing impairment, the Company based on the cash drivers of the financial statements and compared the recoverable amount and book value. If the amount of recoverable assets increased in the future, the reversal of impairment shall be recognized as income. The book value of the reversal of impaired assets shall not exceed the book value before recognition for impairment net of amortization. Subsequent reversal of impairment loss is not allowed.

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In the event of loss of control over the subsidiary, the Company shall measure the fair value of the residual investment in the subsidiary on the date loss of control over the subsidiary. The difference between the fair value of the residual investment and the amount of disposal and the book amount of the investment on the date loss of control over the subsidiary is recognized in the profit and loss of the year. In addition, the accounting treatment for the amounts recognized in the other comprehensive income that are related to the subsidiary is same as the accounting principle to be complied with while the Company directly disposing the relevant assets or liabilities.

The unrealized concurrent trade between the company and the subsidiaries stated in the financial statement of individual entities shall be removed. The profit or loss resulting from the countercurrent, and side-stream transactions between the Company and the subsidiary are recognized in the individual financial statement within the range irrelevant with the Company’s interest in the subsidiary.

(7) Investments in affiliates

The company has a significant influence on an affiliated company that is not a subsidiary or joint venture.

The Company adopts the equity method for investment in affiliates.

Under the equity method, investments in the affiliated companies were originally recognized at cost; the book value after the acquisition date fluctuates along with the distribution of profit or loss from the affiliated company and other comprehensive profit or loss. In addition, the changes in the equity of affiliates shall be recognized in proportion to the proportion of shareholding.

Acquisition costs in excess of the Company’s share of net identifiable assets and liabilities (i.e. fair value) in an affiliated company on the date of acquisition are recognized as goodwill. This goodwill includes book value of the investment and is not amortized. Share of net identifiable assets and liabilities (i.e. fair value) in an affiliated company that exceeds acquisition cost on the date of acquisition is recognized as gains for the current year.

When affiliates issue new shares, if the Company fails to subscribe stock share proportionally to their shareholding, resulting in changes in shareholding ratio and thus causing changes in net equity investment, the increase or decrease amount should be adjusted to the additional paid-in capital – recognizing changes in net equity of affiliates, and joint under the equity method and investment under equity method. If the Consolidated Company’ did not subscribe to the new shares pro rata to the shareholding percentages and led to a decrease of the shareholding percentages subscribed to or obtained from the affiliate, nevertheless, the amount of other comprehensive income so recognized was reclassified pro rata to the decrease ratio in the affiliate. The accounting management was on the grounds same as the grounds the affiliate must comply with if it directly disposed assets or liabilities. If the aforementioned adjustment must be debited into capital reserve where the balance of capital reserve yielded by the investment in equity method, the difference was debited as retained earnings.

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In the event that the Company’s shares of loss in the affiliates equal to or exceed its equity in the affiliates (including the book value of investment in the affiliates in equity method and other long-term interest of the Company’ in the investment composition of the affiliates), the Company’ discontinued recognition of the further losses. The Company’ recognized extra losses and liabilities only in the event of occurrence of legal obligations, presumed obligations or within the scope that the Company’ had made payment on behalf of the affiliate.

When assessing impairments, the Company treats the entire account (including goodwill) as a single asset and tests for impairment by comparing it with recoverable amount and book value. Any impairment losses recognized are presented as part of the book value of the investment. Any reversal of the impairment loss can be recognized within the range of the recoverable amount of the subsequently increased investment.

The Company ceases to adopt the equity method from the date its investment ceases to be an affiliate, and its retained interest in the former affiliate is measured at fair value. The difference between the fair value and the disposal price and the carrying amount of the investment on the date of cessation of the equity method is recognized in profit or loss for the current period. Furthermore, all relevant amounts relevant to the affiliates recognized in other comprehensive income were managed on the accounting grounds same as the grounds which it should comply with if the affiliates directly disposed the relevant assets or liabilities. If the investment in affiliates become an investment in the joint venture, or the investment in the joint venture becomes an investment in affiliates, the Company will continue using the equity method and will not have the reserved equity remeasured.

The profit or loss resulting from the countercurrent, downstream and side-stream transactions between the Company and the affiliated company is recognized in the individual financial statement within the range that is irrelevant to the Company’s interest in the affiliated company.

(8) Property, Plant and Equipment

Property, plant and equipment are recognized as costs, and they will be measured by the amount after the costs less the amount of accumulated depreciation and accumulated impairment losses afterwards.

Those real estate, plant buildings, equipment & facilities under construction were recognized at the amount of the costs after deducting the loss in the accumulated impairment. Cost includes professional service fees and loan costs that qualify for capitalization. When such assets are completed and reach expected use status, such assets will be classified to proper items under real property, plant and equipment and the provision of depreciation shall begin.

The depreciation of each material part of real estate, plants, and equipment should be appropriated independently in accordance with the useful year and a straight-line method. The Company shall review the estimation of life span, residual value and depreciation method at least once a year and extend the effect of changes in applicable accounting policy.

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In the case of delisting real estate, plants, and equipment, the difference between the net disposal price and the book value of the asset is recognized in profit or loss.

• (9) Intangible assets

• Acquired separately

The intangible asset with limited useful life acquired separately was originally measured at cost and subsequently measured at cost, net of accumulated amortization and accumulated impairment losses. Depreciation is recognized using the straight-line method for intangible asset. The estimated useful lives, residual values and depreciation method are reviewed at the end of each yearly reporting period, with the effect of any changes in estimate accounted for on a prospective basis. Intangible asset with indefinite useful lives is measured at cost net of accumulated impairment losses.

1. Derecognition

In removing intangible assets, the difference between the net proceeds of disposition and the book value shall be recognized as income.

• (10) Impairment of tangible and intangible assets (except for goodwill).

The Company at each balance sheet date is to assess whether there is any indication of impairment occurring to the tangible and intangible assets (except for goodwill). If there is any indication of impairment occurring, the recoverable amount of the asset should be estimated. If the recoverable amount of an individual asset cannot be estimated, the Company is to estimate the recoverable amount of the respective cash-generating unit. The community assets are amortized to the minimum cash generating unit cluster reasonably and consistently.

The intangible asset with indefinite useful lives and not yet available for use should be tested for impairment at least annually or should be tested when there is an indication of impairment.

The recoverable amount is the fair value net of cost or the value in use whichever is higher. When the recoverable amount of an individual asset or cash-generating unit is less than its book amount, the book amount of the asset or cash-generating unit should be reduced to its recoverable amount. The impairment loss is recognized in the profit or loss.

When the impairment loss was reversed subsequently, the book amount of the asset or cash-generating unit is increased to the adjusted recoverable amount, but the increased book amount may not exceed the book value of the asset or cash-generating unit or Contract cost-related assets without recognizing the impairment loss in prior periods (net of amortization or depreciation). The reversed impairment loss is recognized in the profit or loss.

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• (11) Non-current assets held for sale

The carrying amount of non-current assets is classified as held for sale when it is expected to be recovered primarily through a sale transaction rather than through continued use. The non-current assets complying with the classification must be available for immediate sale in the current state and the probability of the sale must be highly likely. When the appropriate level of the management commits to sell the plan asset and the sale is expected to be completed within one year from the date of classification, the probability of the sale is highly likely.

• (12) Financial instrument

When the Company has become a party to the instrument contract, the financial assets and financial liabilities are to be recognized in the individual balance sheet.

For the initial recognition of the financial assets and financial liabilities, if the financial assets or financial liabilities are not measured at fair value through profit or loss, it is measured at fair value plus transaction cost that is directly attributable to the acquisition or issuance of financial assets or financial liabilities. The transaction cost directly attributable to the acquisition or issuance of financial assets or financial liabilities that are measured at fair value through profit or loss is immediately recognized in the profit or loss.

1. Financial asset

The regular way of purchase or sale of financial assets are recognized and derecognized based on the accounting on the transaction date.

(1) Classification of measurement

The types of financial assets held by the Company are financial assets at fair value through profit or loss, financial assets at amortized cost, and investments in equity instruments at fair value through other comprehensive income.

• A. Financial assets at fair value through profit and loss

Financial assets at fair value through income statement included mandatory fair value through income statement. Financial instruments designated at fair value through income statements included the investment of equity instruments not designated at fair value through other comprehensive income and those not conforming to the standard of debt instruments on the basis of cost after amortization or at fair value through other comprehensive income.

The financial assets measured at fair value though profit or loss is measured at fair value; also, the profit or loss of revaluation (including any dividend or interest arising from the financial asset) is recognized in the profit and loss. Fair value is determined in the manner described in Note 25.

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• B. Financial assets based on cost after amortization

If the financial assets of the Company met both of the following conditions, classify as financial assets on the basis of cost after amortization:

• a. Financial assets held under particular mode of operation and the purpose of holding is for the collection of cash flow from contracts; and

• b. Cash flow generated on particular dates deriving from the contacts and the cash flow is wholly for the payment of principal and interest accrued from the outstanding amount of the principal.

Financial assets on the basis of cost after amortization (including cash and cash equivalents and accounts receivable on the basis of cost after amortization) shall be determined for the total book value under the effective interest rate method after the initial recognition net of the cost of any impairment after amortization for measurement. Any exchange gains or loss will be recognized as income.

Interest income will be the product of effective interest rate and total book value of financial assets except under the following two conditions:

• a. The interest income of financial assets procured or initiated under credit impairment will be the product of the effective interest rate after credit adjustment and the cost of financial assets after amortization.

• b. Financial asset that has subsequently become credit-impaired, for which interest income is calculated by applying the effective interest rate to the amortized cost of the financial asset.

Cash equivalents include time deposits that are highly liquid, readily convertible into fixed amount of cash with minimal risk of changes in value within 3 months from the acquisition date and are used to meet short-term cash commitments.

• C. Investment of equity instruments at fair value through other comprehensive income

The Company may make an irrevocable choice at the time of initial recognition for designating the investment of equity instruments not available-for-sale and not recognized by the acquirer under business merger and acquisition or with consideration at fair value through other comprehensive income for measurement.

The investment of equity instruments at fair value through other comprehensive income is measured at fair value. Subsequent changes in fair value will be recognized as other comprehensive income and accumulated into other equity. In the disposal of assets, accumulated gains or loss shall be directly transferred to retained earnings without classification as income.

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The dividend of the investment of equity instruments at fair value through other comprehensive income shall be recognized as income when the right of the Company in the collection of dividends is ascertained, unless the dividend is obviously representing the recovery of the cost of investment in part.

(2) Impairment of financial assets

The Company assesses financial assets (including accounts receivable) measured at amortized cost at each balance sheet date based on expected credit losses.

Allowance for loss is recognized for accounts receivable based on the expected credit loss over their life. Other financial assets shall be evaluated for any significant increase of risk from the day of initial recognition. If none is found, recognize for provision for anticipated credit loss along a period of 12 months. If it is, recognize for provision of anticipated credit risk within the perpetuity of the assets.

Anticipated credit loss is the weighted average loss of credit on the basis of the weight of the risk of default. Anticipated credit loss in a period of 12 months means the expected loss of credit from the financial instruments within 12 months due to default. Anticipated credit loss with the perpetuity of the financial instruments means the expected loss of credit from the financial instruments within the perpetuity of these financial instruments.

All impairment of financial assets is recognized through the reduction of the book value of the provisioned account. However, the provision for loss of investment of debt instruments at fair value through comprehensive income shall be recognized as other comprehensive income without the reduction of its book value.

(3) The derecognition of financial assets

The Company’s financial assets are derecognized only when the contractual rights from the cash flows of a financial asset becomes invalid, or when the financial assets are transferred and almost all the risks and rewards of the asset ownership have been transferred to other enterprises.

When a particular entry of financial assets measured at amortized cost is removed, the difference between its book value and consideration shall be recognized as income. When investments in debt instruments measured at fair value through other comprehensive income are derecognized as a whole, the difference between the carrying amount and the sum of the consideration received plus any cumulative gain or loss recognized in other comprehensive income is recognized in profit or loss. When particular equity instruments measured at fair value through comprehensive income are entirely derecognized, the accumulated gains of loss shall be directly transferred to retained earnings without being classified as profit or loss.

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2. Equity instrument

The debt and equity instruments issued by the Company are classified as financial liabilities or equity pursuant to the contractual agreements and the definition of financial liabilities and equity instruments.

An equity instrument issued by the Company is recognized for an amount after deducting the direct issuing cost from the proceeds collected.

The Company’s equity retrieved is debited or credited to the equity. The Company’s equity purchased, sold, issued, or cancelled is not recognized in the profit or loss.

1. Financial liability

2. (1) Subsequent measurement

All financial liabilities are evaluated at the amortized cost using the effective interest method.

• (2) Derecognition of financial liabilities

When derecognizing financial liabilities, the difference between the book amount and the consideration paid (including any transferred non-cash assets or assumed liabilities) is recognized as profit or loss.

• (13) Provision for liabilities

The recognized liability reserve amount is with the risk and uncertainty of the obligation considered, and it is the optimum estimate of the expenditure required to settle the obligations on the balance sheet date. Provision for liabilities shall be measured based on the discount value of the estimated cash flow for the settlement of obligation.

Warranty

Product warranties and warranties that promise to customers that the delivered product is as specified in the contract and will work as specified in the contract, shall be measured based on management’s best estimate on the cost to settle the Company’s obligation, and such warranties shall be recognized upon recognition of revenue from the corresponding products.

• (14) Recognition of revenue

The Company, after identifying the performance obligations, had the transaction price amortized to each performance obligation and recognized as income when the performance obligations were fulfilled.

1. Commodity sales revenue

Revenue from merchandise sales is derived from sales of electronics, electrochemicals, telecommunications, electrical materials, information products and audio products. The Company recognizes revenue and accounts receivable at the point of delivery of electronics, electrochemicals, telecommunication, electrical materials, information products and audio products to the customer’s designated location, at the time of shipment or at the time of pickup by the customer, when the customer has the right to set the price and use the products and has the primary responsibility for reselling the products and bears the risk of obsolescence of the products. Revenue from the

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sale of products in self-operated stores is recognized when the products are purchased by customers. Revenue from Internet sales is recognized when the products arrive at the customer’s designated location. Advanced receipts for Internet sales are recognized as contract liabilities until the products arrive.

When the material is supplied for processing, the ownership of the processed product is not transferred; therefore, the income is not recognized when the material is supplied.

1. Licensing revenue

The licensing revenue is determined based on the actual sales volume for trademark licensing transaction.

• (15) Leases

The Company assesses whether or not the arrangement is (or includes) a lease arrangement on the agreement date

1. The Company is the lessor.

When the lease term is to have all risks and returns attached to the ownership of assets transferred to the lessee, it is classified as a financing lease. All other leases are classified as operating leases.

Lease payments for operating leases upon deduction of lease incentives are recognized as income on a straight-line basis in relevant lease periods. Initial direct costs generated in the acquisition of operating leases are added to the underlying asset carrying amount and recognized as expenses on a straight-line basis in lease periods.

1. The Company is the lessee.

Except for recognizing low-value asset leases applying to exemption and lease payments for short-term leases being recognized as an expense on a straight-line basis over the lease term, other leases will be recognized as right-of-use assets and lease liabilities at the lease commencement date.

The right-of-use asset is measured at cost (including the amount equal to the lease liability at its initial recognition, lease payments made before the commencement of the lease less any lease incentives received, any initial direct costs incurred by the lessee, and an estimate of costs to be incurred by restoring the underlying asset to the condition required) less any depreciation and any accumulated impairment losses. Additionally, the cost is subsequently adjusted for any remeasurement of the lease liability.

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Right-of-use assets are depreciated on a straight-line basis over the period from the commencement date of the lease to expiration of its useful life or expiration of the lease term, whichever date is earlier.

Lease liabilities are measured at the present value of the lease payments (including fixed payments). If the implied interest rate of the lease is easily determined, the lease payments will be discounted to their present value using that interest rate. If such interest rate is not easily determined, the incremental borrowing rate will be used.

Subsequently, the lease liabilities are measured at amortized cost using the effective interest method, and the interest expenses are amortized over the lease term. If changes in indices or rates utilized to determine lease payments lead to changes in future lease payments, the Company should remeasure lease liabilities and adjust right-of-use assets correspondingly. However, if right-of-use asset carrying amounts have already dropped to zero, remaining remeasurement amounts are recognized as profit or loss. Lease liabilities are presented separately in the balance sheet.

• (16) Employee welfare

• Short-term employee benefits

Liabilities relating to short-term employee benefits are measured by the non-discounted amount of the expected payment in exchange for employee services.

2. Post-employment benefits

Under the defined contribution pension plan, the pension amount appropriated during the service years of the employees is recognized as an expense.

The determined cost of benefit for defined benefit retirement plan (including the cost of service, net interest, and reevaluation) is based on the actuary of projected unit method. The net interests of the service cost (including the service cost for the current period) and net defined benefit liability (asset) are recognized as employee benefit expenses when they occur. The value of second measurement (including the profits and loss under actuary and the return on assets of the plan net or interest) shall be recognized as other comprehensive incomes and as retained earnings, if realized. No reclassification as profits and loss in subsequent periods.

Net defined benefit liability (asset) is the appropriation deficit (surplus) of the defined benefit pension plan. Net defined benefit asset shall not exceed the refund of the appropriated fund or decrease the present value of appropriation of fund in the future.

3. Termination benefits

The Company has termination benefit liability recognized when the termination benefit contract cannot be revoked or when recognizing the related reorganization cost (whichever is sooner).

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• (17) Share-based payment arrangement

• Equity Settled Share based Payment Agreement to Employees

For equity-settled share-based payment agreement, expenses are recognized on a straight-line basis over the vesting period based on the fair value of the equity instruments at the date of grant and the best estimate of the number of shares expected to be vested, with a simultaneous adjustment to capital surplus – employee stock options. If gain is realized as of the day of transfer, recognize as expenses in full amount as of the transfer day.

• (18) Income tax

Income tax expense is the sum of the current income tax and deferred income

tax.

1. Income tax expenses in the current period

Additional income tax on unappropriated earnings is calculated in accordance with the provisions of the Income Tax Act of the Republic of China, to be recognized in the year of the shareholder resolution meeting.

The adjustment to prior period income tax payable is booked as current income tax.

2. Deferred tax

Deferred tax is computed in accordance with the temporary differences between the book value of assets and liabilities and the tax bases of taxable income.

Deferred tax liabilities are generally recognized in accordance with all taxable temporary differences. Deferred tax assets are recognized when there are likely to have taxable income available for deductible temporary difference or loss credit.

All taxable provisional differences relevant to the investment in subsidiaries and affiliates were recognized as deferred income tax liabilities, except an event while the Company’ could control the time point of recovery of the control over the provisional difference or while the said provisional difference would be very likely not recoverable in the foreseeable future. The deductible temporary differences related to such investments are recognized as deferred income tax assets when there is likely a sufficient taxable income available for realizing a temporary difference and within the expected reverse in the foreseeable future.

The book amount of deferred income tax asset must be reviewed at each balance sheet date. The book amount of those that no longer have any sufficient taxable income to recover all or part of the asset, should be adjusted down. Those that are not originally recognized as deferred income tax assets should also be reexamined at each balance sheet date. The book amount of those that are likely to generate taxable income in the future for the recovery of all or part of its assets should be adjusted up.

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Deferred income tax assets and liabilities are measured in accordance with the expected liability liquidation or the tax rate in the period when the asset is realized. The tax rate is based on the tax rate and tax laws that are legislated or substantively legislated at the balance sheet date. The measurement of deferred income tax liabilities and assets reflects the tax effect resulting from the book amount of the assets and liabilities expected to be recovered or liquidated at the balance sheet date.

1. Current & deferred income taxes

Current and deferred income taxes are recognized in the profit or loss, except for the current and deferred income taxes related to the items recognized in other comprehensive profit or loss or directly included in the equity are recognized in the other comprehensive profit or loss or directly included in the equity.

If the current income tax or deferred income tax is resulting from a business merger, the income tax effect is included in the accounting process for business merger

5. Main source of significant accounting judgment, estimates and assumptions uncertainty

When adopting accounting policy, the management of the Company shall make related judgments, estimations, and assumptions for information that cannot be easily retrieved from other sources based on historical experiences and other relevant factors. Actual results may differ from the estimates.

The Company has taken the economic impact of the coronavirus pandemic into consideration for significant accounting estimates, and management will review the estimates and underlying assumptions on an ongoing basis. If the amendment affects only the current estimates, it is recognized in the current period. If the amendment of accounting estimates affects both current and future periods, it is recognized in the respective current and future periods.

6. Cash and cash equivalents

and future periods. Cash and cash equivalents
Cash on hand and working capital Bank checks and demand deposits Cash equivalents (Investment with the original maturity date within three months) Bonds under repurchase agreement	December 31, 2021 $ 2,635 169,988 - $ 172,623	December 31, 2020
			$ 2,885 378,905 50,000 $ 431,790

The interest rate ranges for bonds with repurchase agreements as of the balance sheet date were as follows:

date were as follows:
Bonds under repurchase agreement	December 31, 2021 -	December 31, 2020
		0.25%

• 31 -

7. Financial assets at fair value through other comprehensive profit or loss Investment of equity instruments at fair value through other comprehensive income

Non-current Domestic investment Unlisted stock Common stock of Nucom International Corporation Common stock of Chinese Television System Inc. Common stock of WK ASSOCIATES LTD. Common stock of Pushi Venture Capital Co., Ltd. Common stock of WK VIII ASSOCIATES LTD. Common stock of MICROMAX INTERNATIONAL CORP. Beneficial certificates Cathay Capital Private Equity Limited Partner Subtotal Foreign investment Unlisted stocks Common stock of GRACE THW HOLDING	December 31, 2021 $ 34,628 137,491 147 335 448 12,910 49,325 235,284 234,081 $ 469,365	December 31, 2020	December 31, 2020
			$ 31,576 103,392 4,671 7,084 4,352 12,471 - 163,546 255,357 $ 418,903

The Company invested in the aforementioned common shares of companies in line with its long-term investment strategic objective with the anticipation of return from long-term investment. The management of the Company holds that the short-term fluctuation in the fair value of these investments shall be recognized as income or loss and is not congruent with the aforementioned long-term investment plan, therefore they chose to designate these investments as financial assets at fair value through other comprehensive income.

8. Financial assets based on cost after amortization

Current Domestic investment Time deposit with the original maturity date over three months	December 31, 2021 $ -	December 31, 2020	December 31, 2020
			$ 217,907

• 32 -

As of December 31, 2020, the interest rate ranges for time deposits with original maturities over 3 months were 0.57% to 0.72% per annum.

1. Notes receivable, accounts receivable, and other accounts receivable

Notes receivable Measured at amortized cost Total carrying amount – non-related parties Total carrying amount – related parties Less: Allowance for losses Accounts receivable Measured at amortized cost Total carrying amount – non-related parties Total carrying amount – related parties Less: Allowance for losses Other receivables Other receivables – non-related parties Other receivables – related parties Less: Allowance for losses Overdue receivables (Note 14) Overdue receivables Less: Allowance for losses	December 31, 2021 $ 203,333 7,047 ( 7,363) $ 203,017 $ 635,481 464 ( 37,813) $ 598,132 $ 10,782 7,008 ( 623) $ 17,167 $ 32,713 ( 32,713) $ -	December 31, 2020	December 31, 2020
	( ( ( (	( ( ( (	$ 114,410 - 4,004) $ 110,406 $ 288,132 453 26,615) $ 261,970 $ 11,831 4,598 575) $ 15,854 $ 32,713 30,137) $ 2,576

The average credit period for product sales ranges from 30 to 120 days, and no interest is charged on accounts receivable.

The Company will recognize the lifetime expected credit losses as loss allowance for accounts receivable. The full lifetime expected credit losses are calculated using Provision Matrix, which considers the historical default records and current financial status, industry economic conditions, as well as GDP forecast and industry outlook. Due to the historical experience of credit losses of the Company, there is no significant difference in the loss patterns of different customer groups. Therefore, the provision matrix does not further distinguish the customer base, and only sets the expected credit loss rate based on the overdue days of receivables.

If there is evidence that the counterparty is facing serious financial difficulties and the Company cannot reasonably expect the recoverable amount back, the Company will

• 33 -

directly write off the relevant accounts receivable, but will continue its recourses, and the amount recovered will be recognized in profit or loss.

The Company measures the allowance for losses of notes receivable, accounts receivable, other receivables, and collections according to the reserve matrix as follows:

December 31, 2021

December 31, 2021
Total book value Allowance for loss (expected credit loss of the given duration) Amortized cost	Not overdue		Overdue 1 to 30 days		Overdue 31 to 60 days		Overdue 61 to 90 days		Overdue for more than 90 days			Total
	(	$ 827,525 37,549) $ 789,976	(	$ 32,842 6,893) $ 25,949	(	$ 3,716 1,341) $ 2,375	(	$ 32 16) $ 16	(	$ 32,713 32,713) $ -	(	$ 896,828 78,512) $ 818,316

December 31, 2020

December 31, 2020
Total book value Allowance for loss (expected credit loss of the given duration) Amortized cost	Not overdue		Overdue 1 to 30 days		Overdue 31 to 60 days		Overdue 61 to 90 days		Overdue for more than 90 days			Total
	(	$ 397,102 25,108) $ 371,994	(	$ 14,155 2,783) $ 11,372	(	$ 6,425 2,371) $ 4,054	(	$ 1,742 932) $ 810	(	$ 32,713 30,137) $ 2,576	(	$ 452,137 61,331) $ 390,806

The expected credit loss rate for each of the above-mentioned ranges is less than 50% for those who are not overdue and those who are less than 60 days overdue, and 50% to 100% for those who are more than 60 days overdue.

Information on the changes in the allowance for losses on receivables is as follows:

	2021	2020
Balance, beginning of year	$ 61,331	$ 57,907
Add: Recovery of bad debts written
off	3,712	1,583
Add: Impairment loss provided for
the year	13,469	1,841
Balance, end of year	$ 78,512	$ 61,331
Inventory
	December 31, 2021	December 31, 2020
Finished good	$ 168,143	$ 148,933
Work in progress	39,204	33,663
Material	325,273	263,947
Merchandise	687,321	632,947
	$ 1,219,941	$ 1,079,490

10. Inventory

• 34 -

Cost of goods sold related to inventories amounted to $5,789,726 thousand and $5,163,076 thousand for 2021 and 2020, respectively. Cost of goods sold includes losses of $4,382 thousand and $(9,209) thousand for the decline in value of inventories (gain on reversal).

As of December 31, 2021 and 2020, the allowance for decline in value of inventories and allowance for slow moving amounted to $54,886 thousand and $50,504 thousand, respectively.

11. Investment under the equity method

respectively. Investment under the equity method
Investment in subsidiaries Investments in affiliates	December 31, 2021 $ 1,672,496 2,807,991 $ 4,480,487	December 31, 2020
			$ 1,589,554 2,739,654 $ 4,329,208

(1) Investment in subsidiaries

tment in subsidiaries tments in affiliates Investment in subsidiaries	December 31, 2021 $ 1,672,496 2,807,991 $ 4,480,487	December 31, 2020 $ 1,589,554 2,739,654 $ 4,329,208	December 31, 2020 $ 1,589,554 2,739,654 $ 4,329,208
Non-public/non-OTC companies AMIGO LOGISTICS CORPORATION New Swell International Investment Co., Ltd. QUANBAO INVESTMENT CO., LTD. DEBAO HOME APPLIANCE CO., LTD. SAMPO HOME INC. SAMPO JAPAN INC. Less: Transfer to treasury stock	December 31, 2021 $ 506,017 98,734 1,066,844 67,289 413,688 4,070 2,156,642 ( 484,146) $ 1,672,496	December 31, 2020
	(	(	$ 451,538 82,360 1,010,618 103,259 420,298 5,627 2,073,700 484,146) $ 1,589,554

The Company’s ownership and voting rights in the equity of the subsidiary at the balance sheet date is as follows:

Percentage of ownership interest and voting rights

Subsidiary name AMIGO LOGISTICS CORPORATION New Swell International Investment Co., Ltd. QUANBAO INVESTMENT CO., LTD. DEBAO HOME APPLIANCE CO., LTD. SAMPO HOME INC. SAMPO JAPAN INC.	December 31, 2021 49% 100% 100% 100% 100% 100%	December 31, 2020
		49% 100% 100% 100% 100% 100%

• 35 -

In August 2020, the Board of Directors of Sampo Home Appliance Co., Ltd. resolved to increase the capital by $200,000 thousand in cash, and the Company’s shareholding was 100% after the increase.

Please refer to Exhibit 4 for the details of the Company’s indirect investment in subsidiaries.

The shares of profit or loss and other comprehensive income of the subsidiaries using the equity method for the years ended December 31, 2021 and 2020 were recognized based on the audited financial statements of each subsidiary for the same period.

(2) Investments in Affiliates

period. Investments in Affiliates
A major affiliated company RECHI PRECISION CO.,LTD.	December 31, 2021 $ 2,807,991	December 31, 2020
			$ 2,739,654

The Company’s ownership and voting rights in the equity of the affiliate at the balance sheet date is as follows:

balance sheet date is as follows:
Company name Listed company RECHI PRECISION CO.,LTD.	December 31, 2021 27%	December 31, 2020
		27%

Level 1 fair value information of affiliated companies with quoted prices in the open market is as follows.

open market is as follows.
Company name RECHI PRECISION CO.,LTD.	December 31, 2021 $ 2,590,154	December 31, 2020
			$ 2,834,252

The Company measures all of the above affiliates using the equity method.

The following summarized financial information is based on the consolidated financial report of all the affiliates in conformity with IFRSs and reflected the adjustments made due to the adoption of the equity method.

RECHI PRECISION CO.,LTD.

RECHI PRECISION CO.,LTD.
Current assets Non-current assets Current liabilities Non-current liabilities Equity Non-controlling interests	December 31, 2021 $ 18,167,184 8,415,323 ( 12,186,895 ) ( 3,982,672) 10,412,940 ( 1,410,508) $ 9,002,432	December 31, 2020
		$ 20,343,375 9,083,696 ( 13,601,152 ) ( 5,546,112) 10,279,807 ( 1,441,564) $ 8,838,243

• 36 -

The Company’s shareholding percentage The Company’s interests Unrealized profits and losses in upstream transactions Goodwill Book value of investment Operating revenues Net profits for the year Other comprehensive income Total comprehensive income Dividends received from RECHI PRECISION CO., LTD.	December 31, 2021 27% $ 2,442,360 ( 102 ) 365,733 $ 2,807,991 $ 22,601,601 $ 518,114 63,616 $ 581,730 $ 94,927	December 31, 2020
		27% $ 2,373,952 ( 31 ) 365,733 $ 2,739,654 $ 19,338,213 $ 722,644 471,130 $ 1,193,774 $ 67,763

For information on the business nature, principal place of business and country of registration of the aforementioned affiliated companies, please refer to Exhibit 4, “Information on Investees, Location, etc.”

12. Property, Plant and Equipment

Cost Balance as of January 1, 2021 Addition Disposal Reclassification Balance as of December 31, 2021 Accumulated depreciation and impairment Balance as of January 1, 2021 Disposal depreciation expense Balance as of December 31, 2021 Net as of December 31, 2021 Cost Balance as of January 1, 2020 Addition Disposal Reclassification Balance as of December 31, 2020 Accumulated depreciation and impairment Balance as of January 1, 2020 Disposal depreciation expense Balance as of December 31, 2020 Net as of December 31, 2020		Proprietaryland		Building		Machinery equipment		Mold equipment		Transportation equipment		Other equipment		Construction in progress		Total
	( ( (	$ 2,995,843 - 176,925 ) 235,678) $ 2,583,240 $ 32,518 - - $ 32,518 $ 2,550,722 $ 3,219,383 36,536 287,519 ) 27,443 $ 2,995,843 $ 32,518 - - $ 32,518 $ 2,963,325	( (	$ 676,249 2,430 563,013 $ 1,241,692 $ 594,277 - 32,493 $ 626,770 $ 614,922 $ 940,885 2,168 266,804 ) - $ 676,249 $ 763,828 192,175 ) 22,624 $ 594,277 $ 81,972	( ( ( (	$ 144,377 - 300 ) - $ 144,077 $ 142,200 300 ) 366 $ 142,266 $ 1,811 $ 144,576 - 199 ) - $ 144,377 $ 142,017 199 ) 382 $ 142,200 $ 2,177	( ( ( (	$ 515,300 52,774 5,017 ) - $ 563,057 $ 480,589 5,017 ) 22,753 $ 498,325 $ 64,732 $ 500,980 25,268 10,948 ) - $ 515,300 $ 455,248 170 ) 25,511 $ 480,589 $ 34,711	( ( ( (	$ 26,451 1,642 1,148 ) - $ 26,945 $ 20,351 1,148 ) 1,771 $ 20,974 $ 5,971 $ 22,339 4,862 750 ) - $ 26,451 $ 20,053 750 ) 1,048 $ 20,351 $ 6,100	( ( ( (	$ 224,436 558 1,537 ) 177,314 $ 400,771 $ 210,646 1,537 ) 11,617 $ 220,726 $ 180,045 $ 240,954 780 17,554 ) 256 $ 224,436 $ 222,954 17,554 ) 5,246 $ 210,646 $ 13,790	( ( (	$ 918,421 736,384 503,793 ) 494,299) $ 656,713 $ - - - $ - $ 656,713 $ 451,258 494,862 - 27,699) $ 918,421 $ - - - $ - $ 918,421	( ( ( (	$ 5,501,077 793,788 688,720 ) 10,350 $ 5,616,495 $ 1,480,581 8,002 ) 69,000 $ 1,541,579 $ 4,074,916 $ 5,520,375 564,476 583,774 ) - $ 5,501,077 $ 1,636,618 210,848 ) 54,811 $ 1,480,581 $ 4,020,496

The Company depreciates its property, plant and equipment on a straight-line basis over the following useful lives.

lowing useful lives.
Building	2–60 years
Main structure	60 years
Mechanical and electrical
power equipment	15 years
Engineering System	4 years
Others	2–10 years
Machinery equipment	5 – 15 years
Transportation equipment	5 – 7 years
Mold equipment	2–3 years
Other equipment	2–20 years

• 37 -

There was no indication of impairment of the above listed property, plant and equipment as assessed by the management in 2021 and 2020.

The Company sold 2 parcels of land located at No. 742-1 and No. 743, Daan Section, Tucheng District, New Taipei City to a non-related party, Goodman Group, for an amount of NT$1,800,000 thousand in July 2021 with a disposal profit of NT$1,068,412 thousand after deducting the book value of NT$680,718 thousand (NT$176,925 thousand booked in the “Land” account and NT$503,793 thousand booked in the “Construction in Progress” account) and related commission expenses of NT$50,870 thousand.

The Company sold the land and buildings located at Dinghu Section, Guishan District, Taoyuan City to a non-related party, Genyi Construction Co., Ltd., in July 2020 for an amount of NT$1,800,000 thousand with a disposal profit of NT$1,371,913 thousand after deducting the book value of NT$362,148 thousand, related business taxes and commission expenses of NT$18,530 thousand, and the un-transferred profit due to the sale and leaseback of NT$47,409 thousand.

Please refer to Note 13 for the Company’s land and buildings sales and leaseback in 2020.

For the amount of property, plant and equipment pledged as collateral for loans, please refer to Note 27.

13. Lease agreement

(1) Right-of-use assets

refer to Note 27. agreement Right-of-use assets
Carrying amount of right-of-use assets Building Transportation equipment Addition of right-of-use assets Depreciation expense of right-of-use assets Building Transportation equipment	December 31, 2021 $ 24,650 4,888 $ 29,538 2021 $ 4,982 $ 21,664 3,764 $ 25,428	December 31, 2020
			$ 46,314 5,030 $ 51,344 2020
			$ 19,297 $ 14,653 2,889 $ 17,542

• 38 -

(2) lease liabilities

lease liabilities
Carrying amount of lease liabilities Current Non-current	December 31, 2021 $ 14,387 $ 15,730	December 31, 2020
			$ 62,322 $ 27,615

The range of discount rates for lease liabilities is as follows:	The range of discount rates for lease liabilities is as follows:
	December 31, 2021	December 31, 2020
Building	1.50%	1.50%
Transportation equipment	1.50%	1.50%

(3) Important lease activities and terms

The Company leases several buildings and transportation equipment for a period of 1–5 years. Upon termination of the lease term, the Company has no preferential right to acquire the leased building, transportation equipment and the Company shall not sublease or transfer all or part of the subject of the lease without the consent of the lessor.

Please refer to Note 13 for the land and buildings at Dinghu Section, Guishan District, Taoyuan City sold to a non-related party, Genyi Construction Co., Ltd., by the Company in July 2020. Since it takes time to relocate from the sold factory subsequently, Sampo Corporation had leased back part of the sold land and buildings for a lease term of 1 year and 3 months with the right-of-use assets for an amount of NT$11,994 thousand and the lease liability of NT$59,403 thousand resulted; therefore, the un-transferred disposal profit due to the sale and leaseback is for an amount of NT$47,409 thousand.

• (4) Other lease information

amount of NT$47,409 thousand. Other lease information
Short-term lease expense Total cash (outflow) of leases		2021 $ 71,094 $ 134,513)		2020
	(		(	$ 53,004 $ 79,708)

The Company has elected to apply the recognition exemption to building leases that qualify as short-term leases and does not recognize the related right-of-use assets and lease liabilities for such leases.

• 39 -

14. Other assets

Other assets
Current Prepayment of foreign letters of credit loan Prepayment for goods Prepaid rental Prepaid lease payments Temporary payments Prepaid expenses and others Non-current Overdue receivables (Note 9) Prepaid expenses and others Refundable deposits	December 31, 2021 $ 132,902 91,380 2,563 6,404 37,988 24,134 $ 295,371 $ - 1,404 9,886 $ 11,290	December 31, 2020
			$ 170,310 139,583 2,157 15,086 3,363 76,371 $ 406,870 $ 2,576 380 9,909 $ 12,865

15. Loans

(1) Short-term borrowings

s Short-term borrowings
Unsecured loans - Credit facility borrowings	December 31, 2021 $ 150,000	December 31, 2020
			$ -

The interest rate on bank loans for operating turnover was 0.891% to 0.900% in 2021.

• (2) Short-term bills payable

2021. Short-term bills payable
Commercial papers payable Less: Discount of short-term notes and bills payable	December 31, 2021 $ 100,000 ( 26 ) $ 99,974	December 31, 2020
	(		$ - - $ -

The short-term bills payable but not yet due were enumerated below:

December 31, 2021

December 31, 2021
Guarantee/underwriting institutions Commercial papers payable (1) International Bills Finance Corporation Mega Bills Finance Co., Ltd.		Face amount $ 50,000 50,000 $ 100,000	Discounted amount ( $ 5 ) ( 21) ($ 26)	Carrying amount
					$ 49,995 49,979 $ 99,974

• 40 -

The interest rate range of short-term bills payable for 2021 was 0.858% to 0.900%.

December 31, 2020: None

(3) Long-term borrowings

0.900%. December 31, 2020:None Long-term borrowings	0.900%. December 31, 2020:None Long-term borrowings	0.900%. December 31, 2020:None Long-term borrowings
LoanContents December31,2021 December31,2020 Bank of Taiwan Total amount of loans: NTD600,000 thousand Nature of Borrowing. Medium and long-term mortgage loans Loan period: 2020.06.01–2023.05.20 Borrowing interest rate: 1.15% Repayment method: Each loan will be repaid in one lump sum on the agreed settlement date. $ - $ 600,000 Bank of Taiwan Total amount of loans: NTD50,000 thousand Nature of Borrowing. Medium and long-term mortgage loans Loan period: 2021.11.22–2024.11.22 Borrowing interest rate: 1.15% Repayment method: Each loan will be repaid in one lump sum on the agreed settlement date. 50,000 - KGI Bank Total amount of loans: NTD300,000 thousand Nature of Borrowing. Medium-term borrowings Loan period: 2020.10.30–2023.10.30 Borrowing interest rate: 1.08656%~1.09078% Repayment method: From 2022.10.30, Repayment of 60 million every 3 months for a total of 5 installments. 300,000 300,000 350,000 900,000 Less: Long-term loans due within one year ( 60,000) - $ 290,000 $ 900,000 The Company provides property, plant and equipment to financial institutions as collaterals for long-term loans, please refer to Note 27 for details of the collaterals. Other Liabilities December 31, 2021 December 31, 2020 Current Other payables Salaries and bonuses payable (including employee profit sharing remuneration) $ 245,415 $ 212,508 Land incremental tax refund commission payable 32,870 - Pensions payable 2,505 2,332 Advertising expenses payable 26,672 21,782 Electronics disposal expenses payable 27,472 20,303 Construction payable 181,540 - Other accrued expenses 66,748 106,419 $ 583,222 $ 363,344
		$ 212,508 - 2,332 21,782 20,303 - 106,419 $ 363,344

The Company provides property, plant and equipment to financial institutions as collaterals for long-term loans, please refer to Note 27 for details of the collaterals.

16. Other Liabilities

(Continued on next page)

• 41 -

(Continued from previous page)

Other Liabilities Contract liability Refund liability Non-current Other Liabilities Temporary receipts Deposits received Others	December 31, 2021 $ 39,468 367,098 $ 406,566 $ 27,870 1,892 1,047 $ 30,809	December 31, 2020	December 31, 2020
			$ 22,067 303,658 $ 325,725 $ 35,826 300 730 $ 36,856

For a description of the nature of the Company’s refund liability, see Note 20.

17. Provision for liabilities

Provision for liabilities
Current Warranty (1) Non-current Warranty (1) Reserve for compensation (2)	December 31, 2021 $ 89,575 $ 9,447 99,216 $ 108,663	December 31, 2020
			$ 72,845 $ 7,265 99,216 $ 106,481

Balance as of January 1, 2021 Provision for the year Balance as of December 31, 2021 Balance as of January 1, 2020 Provision for the year Balance as of December 31, 2020		Warranty $ 80,110 18,912 $ 99,022 $ 76,763 3,347 $ 80,110	Reserve for compensation $ 99,216 - $ 99,216 $ 99,216 - $ 99,216		Total
					$ 179,326 18,912 $ 198,238 $ 175,979 3,347 $ 179,326

• (1) Warranty liabilities reserve is based on the sale of goods contract and it is the best estimated present value of the future economic outflow due to warranty liabilities estimated by the management of the Company. The estimates are based on historical warranty experience and are subject to adjustment due to new raw materials, process changes or other events that affect product quality.

• (2) Please refer to Note 28(2) for the description of reserve for compensation.

• 42 -

18. Post-employment benefit plans

(1) Defined contribution plans

The pension system of the “Labor Pension Act” that is applicable to the Company is a defined contribution pension plan subject to government management with an amount equivalent to 6% of the monthly salary appropriated and contributed to the personal account with the Bureau of Labor Insurance.

(2) Defined benefit plans

The company within the Company has a pension plan arranged in accordance with the “Labor Standard Law” of the Republic of China that was a defined benefit pension plan. Pension payment is calculated in accordance with the years of service and the average salary six months prior to the authorized retirement date. The Company has pension appropriated for an amount equivalent to 15% of the total monthly salary and the fund is deposited in the account with the Bank of Taiwan in the name of the Labor Pension Reserve Committee. If the estimated balance of the special account before the end of the year is not enough to pay for the workers who are expected to meet the retirement requirements in the following year, the difference will be appropriated in one lump sum by the end of March of the following year. The special account has been commissioned to the Bureau of Labor Fund of the Ministry of Labor Affairs for management. The Company contained in the financial statements exercises no influence on the right of the bureau in its investment management strategy.

The amount of defined benefit plan recognized in the individual balance sheet is shown below:

shown below:
	December 31, 2021				December 31, 2020
Present value of the defined
benefit obligations	$ 547,439					$ 572,624
The fair value of plan assets	(219,739		)			(204,235)
Net defined benefit liability	$ 327,700					$ 368,389
Change in net defined benefit	liability is shown below
	Present value
	of the defined
	benefit	The fair value				Net defined
	obligations	of		plan assets		benefit liability
Balance as of January 1, 2020	$ 580,240		($ 184,439		)		$ 395,801
service costs
Service cost for the period	3,763			-			3,763
Interest expenses (income)	4,352		(	1,433	)		2,919
Recognized in profit or loss	8,115		(	1,433	)		6,682
Reevaluation
Planned ROE (except the
amount of net interest)	-		(	5,817)		(	5,817)
Actuarial (gains) losses –
Changes in Demographic
Assumptions	214			-			214

(Continued on next page)

• 43 -

(Continued from previous page)

Actuarial (gains) losses – Change in financial assumptions Actuarial (gains) losses – adjustment through experience Recognized in other comprehensive income Employer appropriation Benefits paid Balance as of December 31, 2020 service costs Service cost for the period Interest expenses (income) Recognized in profit or loss Reevaluation Planned ROE (except the amount of net interest) Actuarial (gains) losses – Changes in Demographic Assumptions Actuarial (gains) losses – Change in financial assumptions Actuarial (gains) losses – adjustment through experience Recognized in other comprehensive income Employer appropriation Benefits paid Balance as of December 31, 2021	Present value of the defined benefit obligations $ 13,735 2,076 16,025 - ( 31,756) 572,624 3,330 2,863 6,193 - 13,959 ( 6,310 ) ( 3,397) 4,252 ( 35,630) $ 547,439	The fair value of plan assets $ - - ( 5,817) ( 12,546 ) - ( 204,235) - ( 1,053) ( 1,053) ( 2,531 ) - - - ( 2,531) ( 11,920 ) - ($ 219,739)	Net defined benefit liability	Net defined benefit liability
	( ( ( (	( ( ( ( ( ( ( ( (	( ( ( ( ( ( (	$ 13,735 2,076 10,208 12,546 ) 31,756 ) 368,389 3,330 1,810 5,140 2,531 ) 13,959 6,310 ) 3,397) 1,721 11,920 ) 35,630 ) $ 327,700

The pension fund system of the company contained in the financial statements is exposed to the following risks due to the “Labor Standards Act”:

1. Investment risk: The Bureau of Labor Fund of the Ministry of Labor Affairs uses the labor pension fund for investment in domestic and foreign equity securities and debt securities, and as bank deposits through proprietary trade or commissioned third parties. However, the amount attributable to the planned asset of the Company contained in the financial statements shall not fall below the interest rate offered by the banks in the regions or countries of investment for 2-year time deposit as return.

2. Interest rate risk: The decrease of the interest rate of government bonds and corporate bonds will cause the present value of the defined benefit obligations to go up; however, the return on the debt of the plan assets will go up too;

3. 44 -

therefore, they will mutually offset the impact on the net defined benefit liabilities.

1. Salary risk: the calculation of the present value of defined benefit obligation is based on the salaries of the members in the plan of the future. As such, an increase of the salaries of the members of the plan is bound to increase the present value of defined benefit obligation.

The defined benefit obligation of the company contained in the financial statements is based on the actuarial calculation of the actuary and the major assumption as of the evaluation day is shown below:

Discount rate The expected rate of increase in salaries	December 31, 2021 0.625% 2.50%	December 31, 2020
		0.50% 2.50%

In case of reasonable and possible change in the major actuarial assumptions, and other assumptions remained unchanged, the amount of increase (decrease) in the present value of defined benefit obligation will be:

Discount rate Increase by 0.25% Decrease by 0.25% The expected rate of increase in salaries Increase by 0.25% Decrease by 0.25%	December 31, 2021 ($ 12,580) $ 13,014 $ 12,559 ($ 12,208)	December 31, 2020	December 31, 2020
	( (	( (	$ 13,735) $ 14,230 $ 13,714 $ 13,310)

Actuarial assumptions may be inter-related. The possibility of change in specific assumption is not high. The aforementioned sensitivity analysis may not be able to reflect the actual change in the present value of defined benefit obligation.

Amount projected for appropriation in 1 year Average maturity of defined benefit obligation	December 31, 2021 $ 11,880 9.7 years	December 31, 2020	December 31, 2020
			$ 12,580 10.2

19. Equity

• (1) Capital stock

Common share

y Capital stock Common share
Authorized number of shares (thousand shares) Authorized capital Number of shares issued and fully paid (in thousands) Capital stock issued	December 31, 2021 1,500,000 $ 15,000,000 387,200 $ 3,872,000	December 31, 2020
			1,500,000 $ 15,000,000 387,200 $ 3,872,000

• 45 -

(2) Capital surplus

Capital surplus
For loss make-up, payment in cash or capitalization as equity (1) Treasury stock transaction Gain on disposal of assets The differences between carrying amount and market price of actual acquisition or disposal of shares in subsidiaries. Only for loss make-up Changes in net equity in affiliated companies and joint ventures recognized under the equity method (2)	December 31, 2021 $ 78,935 50 2,090 132,650 $ 213,725	December 31, 2020
			$ 34,376 50 2,090 135,183 $ 171,699

1. Such additional paid-in capital can be used to make up for losses; also, when the Company is without any loss, it can be applied for cash distribution or capitalization. However, it is limited to a certain percentage of the annual paid-in capital for the purpose of capitalization.

2. Such additional paid-in capital is the equity trade effect recognized due to the changes in the subsidiary’s equity when the Company has not actually acquired or disposed the equity of the subsidiary, or the amount of adjustment to the additional paid-in capital of the subsidiary recognized under the equity method.

A reconciliation of the balances of various types of capital surplus for 2021 and 2020 is as follows

2020 is as follows
Balance as of January 1, 2021 Transfer of treasury shares to employees Changes in affiliates and joint ventures recognized under the equity method Adjustment of capital surplus by dividends paid to subsidiaries Balance as of December 31, 2021 Balance as of January 1, 2020 Transfer of treasury shares to employees Changes in affiliates and joint ventures recognized under the equity method Adjustment of capital surplus by dividends paid to subsidiaries The differences between carrying amount and market price of actual acquisition or disposal of shares in subsidiaries. Balance as of December 31, 2020	Treasury stock transaction		Gain on disposal ofassets		Changes in affiliates and joint ventures recognized under the equity method	The differences between carrying amount and market price of actual acquisition or disposal of shares in subsidiaries.		Total
		$ 34,376 18,088 - 26,471 $ 78,935 $ 14,824 3,670 - 15,882 - $ 34,376		$ 50 - - - $ 50 $ 50 - - - - $ 50	$ 135,183 - ( 2,533 ) - $ 132,650 $ 134,431 - 752 - - $ 135,183		$ 2,090 - - - $ 2,090 $ 2,069 - - - 21 $ 2,090	$ 171,699 18,088 ( 2,533 ) 26,471 $ 213,725 $ 151,374 3,670 752 15,882 21 $ 171,699

• 46 -

(3) Retained earnings and Dividend Policy

According to the Articles of Incorporation, the policy for the distribution of earnings stated that if there is a surplus after account settlement of the fiscal year, the company shall pay applicable taxes and cover loss carried forward, followed by the allocation of 10% of the remainder as legal reserve, and appropriate for special reserve or reverse special reserve. If there is still a balance, it will be pooled up with the undistributed earnings carried forward from previous years for distribution as shareholder dividend under a proposal prepared by the Board subject to the final approval of the General Meeting of Shareholders. See Note 21, “7. Remuneration to Employees and Directors” for the Company’s policy on the distribution of employee and director remuneration under the Articles of Incorporation.

The Company’s dividend policy is to distribute dividends to shareholders in cash or in stock, with cash dividends being no less than 10% of the total dividends, in accordance with the Company’s current and future development plans and taking into account the investment environment, capital requirements and domestic and international competition, and the interests of shareholders.

Legal reserve shall be allocated up to the amount equivalent to the paid-in capital of the company. Legal reserve could be allocated for covering loss carried forward. If there is no loss, the amount of legal reserve in excess of the paid-in capital by 25% could be allocated as capital stock and paid out as cash dividend. The Company has special reserve appropriated and reversed in accordance with the Jin-Guan-Zhen-Fa-Zi No. 1010012865 Letter, Jin-Guan-Zhen-Fa-Zi No. 1010047490 Letter, Jin-Guan-Zhen-Fa-Zi No. 1030006415 Letter and “Appropriation of Special Reserve Q&A after the Adoption of International Financial Reporting Standards (IFRSs).

At the shareholders’ meetings held on August 30, 2021 and June 12, 2020, the Company resolved to distribute the earnings for the years 2020 and 2019, respectively, as follows.

Legal reserve Special reserve Cash dividend	Earnings Distribution Proposal 2020 2019 $ 178,645 $ 73,896 212,402 - 955,750 570,600	Dividend Per Share (NTD)	Dividend Per Share (NTD)
	2020 $ 178,645 212,402 955,750	2020 $ - - 2.5	2019
			$ - - 1.5

The Board of Directors proposed the following earnings distribution proposal for 2021 on March 22, 2022.

for 2021 on March 22, 2022.
Legal reserve Reversal of special reserve Cash dividend	Earnings Distribution Proposal $ 177,793 ( 30,424 ) 1,010,340	Dividend Per Share (NTD)
		$ - - 2.7

• 47 -

The earnings distribution proposal for 2021 is pending the resolution of the shareholders’ meeting scheduled to be held in June 2022.

• (4) Special reserve

Special reserve
Beginning retained earnings Provision for special reserve in accordance Appropriated amount debited to other equity Reversal of special reserve Disposal of land Balance, ending		2021 $ 1,592,788 212,402 144,824) $ 1,660,366		2020
	(		(	$ 1,688,706 - 95,918) $ 1,592,788

• (5) Other equity

• Exchange differences on translation of financial statements of foreign operations

	operations
			2021		2020
	Balance, beginning of year	(	$ 276,262 )	(	$ 305,398 )
	Generated in the year
	Translation differences of
	foreign operations	(	1,648 )	(	2,572 )
	The shares of profit and/or
	loss at equity method
	over the affiliates	(	14,383)		31,708
	Other comprehensive income
	of the current year	(	16,031)		29,136
	Balance, end of year	(	$ 292,293)	(	$ 276,262)
2.	Unrealized valuation gains or	losses	on financial assets measured at fair value
	through other comprehensive income
			2021		2020
	Beginning retained earnings		$ 133,596		$ 134,923
	Accrued in current year
	Unrealized gain or loss
	Equity instrument		13,947	(	96,322 )
	The shares of profit and/or
	loss at equity method
	over the affiliates		36,575		94,995
	Other comprehensive income
	of the current year		50,522	(	1,327)
	Accumulated profit and loss
	from the disposal of equity
	instruments by associates
	under the equity method is
	transferred to retained
	earnings.	(	113,668)		-
	Balance, end of year		$ 70,450		$ 133,596

• 48 -

(6) Treasury shares

Unit: 1,000 shares/thousand

Reason for recovery Number of shares as of January 1, 2021 Increase in the period Decrease in the period Number of shares as of December 31, 2021 Number of shares as of January 1, 2020 Decrease in the period Number of shares as of December 31, 2020 Amount as of January 1, 2021 Increase in the period: Repurchase of 10,000 thousand shares Decrease in the period: Stock transfer to employees Amount as of December 31, 2021 Amount as of January 1, 2020 Decrease in the period: Stock transfer to employees Amount as of December 31, 2020	Stock transfer to employees 6,800 10,000 ( 1,900) 14,900 7,800 ( 1,000) 6,800 $ 108,681 293,727 ( 30,362) $ 372,046 $ 124,661 ( 15,980) $ 108,681	Shares of parent company held by subsidiaries 10,432 - - 10,432 10,432 - 10,432 $ 484,146 - - $ 484,146 $ 484,146 - $ 484,146		Total
	( ( ( (		( ( ( (	17,232 10,000 1,900) 25,332 18,232 1,000) 17,232 $ 592,827 293,727 30,362) $ 856,192 $ 608,807 15,980) $ 592,827

In order to protect the Company’s credit and shareholders’ interests, the subsidiary held the Company’s shares as of the balance sheet date, and the related information is as follows.

information is as follows.
Subsidiary name December 31, 2021 QUANBAO INVESTMENT AMIGO LOGISTICS CORPORATION December 31, 2020 QUANBAO INVESTMENT AMIGO LOGISTICS CORPORATION	Number of shares held (in thousand shares) 10,050 382 10,050 382	Carrying amount $ 482,468 1,678 $ 484,146 $ 482,468 1,678 $ 484,146	Market price
				$ 300,490 11,415 $ 311,905 $ 261,798 9,945 $ 271,743

• 49 -

Sampo Corporation repurchases 10,000 thousand shares of treasury stock in the current period for an amount of NT$293,727 thousand.

The Company’s board of directors resolved on January 25, 2021 and January 8, 2020 to have 1,900 thousand treasury shares and 1,000 thousand treasury shares transferred to employees for subscription in accordance with the Rules Governing the Transfer of Treasury Stock to Employees. The aforementioned transfer of treasury plan was completed in February 2021 and February 2020, respectively, with the treasury stock cost written-off for an amount of NT$30,362 thousand and NT$15,980 thousand, respectively.

The company’s Treasury stock may not be pledged in accordance with the Security and Exchange Law; moreover, it is without the privilege of dividend and voting right. Sampo Corporation’s shares held by subsidiaries are treated as treasury stock and have the same rights as those of ordinary shareholders, except that they are not allowed to participate in the capital increase of Sampo Corporation and have no voting rights.

20. Income

voting rights. Income
Revenue from contracts with customer Merchandise sales revenue Service revenues Licensing revenue Other income		2021 $ 7,061,155 236,838 19,887 699 $ 7,318,579		2020
				$ 6,249,376 234,822 21,977 984 $ 6,507,159

• (1) Description of customer contracts

• Merchandise sales revenue

Home appliances and electronic products are sold to distributors or through the Company’s self-operated stores and online. The Company gives price discounts to distributors when they meet the contractual requirements. The amount of revenue is based on the most probable amount of the discount considering the distributor’s past orders, and the refund liability (recorded as other current liabilities) is recognized accordingly. Please refer to Note 16. The rest of the products are sold at a fixed price as agreed in the contract.

In accordance with commercial practice, the Company accepts returns of home appliances and electronic products for full refund. Considering the experience accumulated in the past, the Company estimated the return rate based on the most probable amount and recognized the refund liability (recorded as other current liabilities), please refer to Note 16. Please refer to Note 17 for the description of defective warranty obligations for home appliances and electronic products.

1. Licensing revenue

The Company’s trademark licensing is determined based on the actual sales volume for trademark licensing transaction.

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(2) Contract balances Accounts receivable (Note 9) Contract liabilities – current (Note 16) Merchandise sales		2021 $ 598,132 $ 39,468		2020
				$ 261,970 $ 22,067

21.	Net profits for the year (1) Interest income Bank deposits Financial assets measured at amortized cost Others (2) Other income Rental income Dividend income Others (3) Other gains and losses Gain on disposal of property, plant and equipment Net foreign currency exchange loss Lease modification gain Miscellaneous expenses (4) Financial costs Interest on bank borrowings Interest on lease liabilities		2021 $ 133 667 69 $ 869 2021 $ 28,067 10,337 43,676 $ 82,080 2021 $ 1,068,507 1,772 ) 23 19,776) $ 1,046,982 2021 $ 8,487 966 $ 9,453		2020
					$ 545 6,187 919 $ 7,651 2020
					$ 21,609 7,738 34,251 $ 63,598 2020
		( (		( (	$ 1,371,915 14,117 ) 92 26,104) $ 1,331,786 2020
					$ 20,019 988 $ 21,007

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(5) Depreciation and amortization

(5) Depreciation and amortization
Property, Plant and Equipment Right-of-use assets Intangible assets Total Summary of depreciation expenses by function Operating costs Operating expenses Summary of amortization expenses by function Operating expenses (6) Employee benefits expenses Post-employment benefits (Note 18) Defined contribution plans Defined benefit plans Termination benefits Other employee benefits Total employee benefits expenses Consolidation based on functions Operating costs Operating expenses		2021 $ 69,000 25,428 38,626 $ 133,054 $ 25,282 69,146 $ 94,428 $ 38,626 2021 $ 19,675 5,140 24,815 193 703,514 $ 728,522 $ 232,562 495,960 $ 728,522		2020
				$ 54,811 17,542 39,545 $ 111,898 $ 28,001 44,352 $ 72,353 $ 39,545 2020
				$ 18,973 6,682 25,655 1,871 665,444 $ 692,970 $ 225,329 467,641 $ 692,970

(7) Remuneration to employees and directors

In accordance with the Company’s Articles of Incorporation, the Company appropriates no less than 1% and no more than 3% of the profits before tax and before the distribution of employees’ and directors’ remuneration for the year as Remuneration to employees and directors The estimated remuneration to employees and directors for 2021 and 2020 was resolved on March 22, 2022 and March 24, 2021 by the board of directors as follows.

Estimate Percentage

Estimate Percentage
Remuneration to employees Remuneration to directors	2021 4.30% 0.70%	2020
		2.20% 0.80%

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Amount

Amount
Remuneration to employees Remuneration to directors	2021 C a s h $ 78,001 12,698	2020
		C a s h
		$ 45,577 16,574

If there are still changes in the amount specified in the individual financial statement after announcement, proceed to the accounting of change and adjusted for booking in the next fiscal year.

There was no difference between the actual amount of employees’ and directors’ remuneration paid for 2020 and 2019 and the amount recognized in the individual financial statements in 2020 and 2019.

For information on remuneration to employees and directors as resolved by the Board of Directors in 2022 and 2021, please visit the Market Observation Post System of the Taiwan Stock Exchange.

22. Income tax

• (1) The main composition items recognized as income tax expenses in income:

2021 2020 Income tax expenses in the current period Recognized in the current year $ 48,917 $ 85,813 Additional levy on undistributed earnings 26,778 - Land revaluation increment tax 73,101 233,079 Prior year adjustment ( 1,306 ) 2,038 Deferred tax Recognized in the current year ( 92,540) ( 107,373) Income tax expense recognized in the profit or loss $ 54,950 $ 213,557 Adjustment of accounting income and income tax expense are as follows: 2021 2020 Net profits before tax $ 1,723,281 $ 2,009,550 Income tax expense of net income before tax at the statutory tax rate $ 344,656 $ 401,910 Non-deductible expenses and losses for tax purposes - 30 Non-taxable income ( 259,118 ) ( 338,380 ) Additional levy on undistributed earnings 26,778 - Reversal of land incremental tax reserve (1) ( 14,805 ) - Additional appropriation of land incremental tax (2) - 141,958 Temporary difference ( 41,255 ) 6,001 Income tax expense of prior years adjusted in the current year ( 1,306) 2,038 Income tax expense recognized in the profit or loss $ 54,950 $ 213,557		2020
	(	$ 2,009,550 $ 401,910 30 338,380 ) - - 141,958 6,001 2,038 $ 213,557

• 53 -

• The Company sold 2 parcels of land located at No. 742-1 and 743, Daan Section, Tucheng District, New Taipei City in July 2021. The land incremental tax reserve for an amount of NT$87,906 thousand booked in the “Deferred income tax liability” account was reversed when it was sold. The Company actually paid land incremental tax for an amount of NT$142,127 thousand in 2021. The Company had applied to the Revenue Service Office, New Taipei City Government for a refund of the land incremental tax in December 2021, and an amount of NT$69,026 thousand was approved for refund to the Company in February 2022. Therefore, the reversal of land incremental tax reserve for the land sold in 2021 was NT$14,805 thousand.

• The Company sold the land and buildings located at Dinghu Section, Guishan District, Taoyuan City in July 2020. The land incremental tax reserve for an amount of NT$91,121 thousand booked in the “Deferred income tax liability” account was reversed when it was sold. The Company actually paid land incremental tax for an amount of NT$233,079 thousand in 2020. Therefore, the additional appropriation of land incremental tax reserve for the land sold in 2020 was NT$141,958 thousand.

• (2) Current income tax asset and liability

Current income tax asset and liability
Current income tax asset Tax refunds receivable from prior years Current Tax Liability Income tax payables	December 31, 2021 $ - $ 30,915	December 31, 2020
			$ 490 $ 74,251

• (3) Deferred income tax assets and liabilities

Changes in the deferred income tax assets and liabilities are as follows:

2021

2021
Deferred tax assets Temporary difference Loss allowance Inventory Investment accounted for under the equity method Other payables Vacation benefit payable Provision for liabilities	Balance, beginning of year $ 10,407 10,101 ( 32,748 ) 151,933 5,113 35,865	Recognized in profit or loss $ 2,592 876 - 7,653 ( 283 ) 3,782	Balance, end of year
			$ 12,999 10,977 ( 32,748 ) 159,586 4,830 39,647

(Continued on next page)

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(Continued from previous page)

Defined benefit pension plans Employee benefits payable Other non-current liabilities Exchange gain Total Deferred tax liabilities Temporary difference Reserve for land revaluation increment tax (“LRIT”) 2020 Deferred tax assets Temporary difference Loss allowance Inventory Investment accounted for under the equity method Right-of-use assets Other payables Vacation benefit payable Provision for liabilities Defined benefit pension plans Employee benefits payable Other non-current liabilities Exchange gain Total Deferred tax liabilities Temporary difference Reserve for land revaluation increment tax (“LRIT”)	Balance, beginning of year ( $ 22,589 ) 108 2 ( 2,369) $ 155,823 ($ 729,313) Balance, beginning of year $ 9,901 11,943 ( 47,948 ) 88 137,313 5,794 35,196 ( 15,066 ) 101 13 2,236 $ 139,571 ($ 820,434)	Recognized in profit or loss ( $ 8,482 ) ( 108 ) ( 2 ) ( 1,394) $ 4,634 $ 87,906 Recognized in profit or loss $ 506 ( 1,842 ) 15,200 ( 88 ) 14,620 ( 681 ) 669 ( 7,523 ) 7 ( 11 ) ( 4,605) $ 16,252 $ 91,121	Balance, end of year
			( $ 31,071 ) - - ( 3,763) $ 160,457 ($ 641,407) Balance, end of year
			$ 10,407 10,101 ( 32,748 ) - 151,933 5,113 35,865 ( 22,589 ) 108 2 ( 2,369) $ 155,823 ($ 729,313)

(4) The status of income tax assessment

The Company’s profit-seeking enterprise income tax returns have been assessed by the tax authorities through 2019.

• 55 -

23. Earnings per share

Unit: NTD per share

Basic earnings per share Diluted earnings per share		2021 $ 4.52 $ 4.49		2020
				$ 4.86 $ 4.82

The earnings and weighted average common stock shares used in calculating the earnings per share are as follows:

Net profits for the year

earnings per share are as follows: Net profits for the year
Net profit attributable to shareholders of parent company Number of shares Weighted average common stock shares used to calculate basic earnings per share Effect of dilutive potential common stock: Remuneration to employees Weighted average common stock shares used to calculate diluted earnings per share		2021 2020 $ 1,668,331 $ 1,795,993 Unit: shares in thousands 2021 2020 368,889 369,885 2,951 2,546 371,840 372,431

If the Company may choose to have the employee compensation distributed via a stock or cash dividend, calculate the diluted earnings per share, assuming that the bonus to employees is with a stock dividend distributed, with the weighted average number of shares outstanding included when the potential common stock has a diluted effect. When diluted EPS is calculated in the next year resolves the number of share distribution for employee compensation, the dilution effect is also considered for such potential common shares.

24. Capital risk management

Under the premise of capital management for assuring sustainable operation, the Company seeks to maximize return to shareholders through the optimization of debts and equity balance.

The Company’s capital structure consists of net debt (i.e. borrowings less cash and cash equivalents) and equity (i.e. capital stock, capital surplus, retained earnings and other equity items).

• 56 -

25. Financial instrument

• (1) Information on fair value – financial instruments at fair value on repetition.

• Fair value hierarchy

December 31, 2021

Fair value hierarchy December 31, 2021
Financial assets at fair value through other comprehensive profit or loss Investment in equity instruments - Domestic unlisted stocks - Domestic beneficial certificates - Foreign unlisted stocks Total December 31, 2020 Financial assets at fair value through other comprehensive profit or loss Investment in equity instruments - Domestic unlisted stocks - Foreign unlisted stocks Total		Level 1 $ - - - $ - Level 1 $ - - $ -		Level 2 $ - - - $ - Level 2 $ - - $ -		Level 3 $ 185,959 49,325 234,081 $ 469,365 Level 3 $ 163,546 255,357 $ 418,903		Total
								$ 185,959 49,325 234,081 $ 469,365 Total
								$ 163,546 255,357 $ 418,903

There were no transfers between Level 1 and Level 2 fair value measurements in 2021 and 2020.

1. Financial instruments are adjusted according to Level 3 fair value.

2021

2021
Financial asset Beginning retained earnings Recognized in other comprehensive income (unrealized valuation gains or losses on financial assets measured at fair value through other comprehensive income) Refund from capital reduction Purchase of fund beneficiary certificate Balance, ending	Financial assets at fair value through other comprehensive profit or loss
	Equity instrument
	$ 418,903 13,947 ( 13,485 ) 50,000 $ 469,365

• 57 -

2020

Financial assets at fair value through other comprehensive profit or loss Financial asset Equity instrument Beginning retained earnings $ 515,225 Recognized in other comprehensive income (unrealized valuation gains or losses on financial assets measured at fair value through other comprehensive income) ( 96,322 ) Balance, ending $ 418,903

1. Evaluation techniques and an input value of Level 3 fair value measurement

The fair value of unlisted (over-the-counter) equity instruments is estimated based on an analysis of the financial condition and results of operations of the investees, the quoted prices of the shares of companies with similar operations in active markets, the value multipliers implied by these prices and relevant transaction information, and the valuation of the subject by an appropriate multiplier, taking into account the financial performance of the subject.

(2) Categories of financial instruments

subject. Categories of financial instruments
Financial asset Financial assets based on cost after amortization (Note 1) Financial assets at fair value through other comprehensive profit or loss Investment in equity instruments Financial liability Measured at amortized cost (Note 2)	December 31, 2021 $ 990,939 469,365 1,837,841	December 31, 2020
		$ 1,037,927 418,903 2,011,297

Note 1: The balance consists of financial assets measured at amortized cost, including cash and cash equivalents, notes receivable, accounts receivable, notes and accounts receivable from related parties, other receivables, other receivables from related parties, time deposits with original maturities of more than three months and pledged time deposits.

• 58 -

• Note 2: The balance consists of financial liabilities measured at amortized cost, including short-term borrowings, short-term notes payable, notes payable, accounts payable, notes and accounts payable to related parties, other payables, other payables to related parties, long-term loans due within one year, and long-term loans.

• (3) Purpose and policy of financial risk management

The Company’s major financial instruments include investments in equity and debt instruments, accounts receivable, accounts payable and borrowings. The Company’s financial management department provides services to each business unit, coordinates the operation of access to domestic and international financial markets, and monitors and manages financial risks associated with the Company’s operations through internal risk reports that analyze risk exposures based on risk degree and breadth. These risks include market risk (including exchange rate risk, interest rate risk and other price risk), credit risk and liquidity risk.

1. Market risk

Due to the operating activities, the major financial risk faced by the Company is the foreign currency exchange rate risk (see (1) below) and interest rate risk (see (2) below).

• (1) Exchange rate risk

The Company engages in foreign currency-denominated sales and purchase transactions, which expose the Company to exchange rate risk.

The carrying amounts of monetary assets and monetary liabilities denominated in non-functional currencies as of the balance sheet date are shown in Note 30.

Sensitivity analysis

The Company is prone to the impact of changes in USD exchange rates.

The Branch’s sensitivity analysis for the exchange rate of NT dollar (the functional currency) to each relevant foreign currency increased or decreased by 1% is detailed as follows. The 1% sensitivity is used internally for reporting the exchange rate risk to management and is the assessment by management regarding the reasonable and possible changes in foreign exchange rates. The sensitivity analysis includes only the outstanding monetary items in foreign currency; also, the translation at year-end is adjusted in accordance with the changes in exchange rates by 1%. The positive numbers in the following table represent the increase in net profits before tax if the NTD weakens by 1% against the respective currencies, and the negative numbers for the same amount represent the decrease in net profits before tax if the NTD strengthens by 1% against the respective currencies.

the respective currencies.
Profit or loss	Impact of	USD (i)
	2021 $ 1,933	2020
		$ 2,238

• 59 -

• (i) These receivables and payables are mainly due to the Company’s outstanding USD-denominated receivables and payables that are not cash flow hedged as of the balance sheet date.

• (2)

• Interest rate risk

Interest rate risk exposure is due to the entities within the company borrowing funds at floating interest rates.

The carrying amount of financial assets and liabilities of the Company under interest rate exposure on balance sheet date is as follows:

December 31, 2021 December 31, 2020

With fair value interest
rate risk
Financial asset	$	-	$	267,907
Financial liability		249,974		-
Contain cash flow
interest rate risk
Financial asset		167,259		378,743
Financial liability		350,000		900,000

The Company is exposed to cash flow interest rate risk as a result of holding floating rate bank loans. These circumstances are consistent with the Company’s policy of maintaining floating rate borrowings to reduce interest rate fair value risk. The Company’s cash flow interest rate risk is mainly due to fluctuations in benchmark interest rates related to NTD-denominated borrowings.

Sensitivity analysis

The following sensitivity analyses are based on the interest rate risk exposure of the derivative and non-derivative instruments on the balance sheet date. For liabilities with floating rate, it is analyzed by assuming the liabilities on the balance sheet date are outstanding throughout the reporting period. The rate of change used by the Company to report interest rates to management is increased or decreased by 0.25%, which also represents management’s assessment of the reasonably possible range of interest rates.

If interest rates had increased by 0.25%, with all other variables held constant, the Company’s net profits before income tax would have decreased by $457 thousand and $1,303 thousand for 2021 and 2020, respectively, mainly due to the Company’s exposure to fair value interest rate risk on its floating rate borrowings.

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(3) Other price risk

The Company has equity price risk exposure due to its investment in listed equity securities. The Company’s management command risk by holding a diverse portfolio of risky investments. The Company’s equity price risk is concentrated in the equity instruments of the TWSE and TPEx.

Sensitivity analysis

The following sensitivity analysis is based on the equity price risk at the balance sheet date.

If the equity price had increased by 1%, other comprehensive income after tax would have increased by $4,694 thousand and $4,189 thousand in 2021 and 2020, respectively, due to the increase in fair value of financial assets measured at fair value through other comprehensive income.

2. Credit risk

Credit risk refers to the risk that the counter party delays the contractual obligation resulting in the financial loss of the Company. As of the balance sheet date, the Company’s maximum exposure to credit risk (without regard to collateral or other credit enhancement instruments and the maximum amount of irrevocable exposure) that could result in financial loss due to the counterparty’s failure to perform its obligations and the Company’s provision of financial guarantees was primarily attributable to.

• (1) The carrying amount of financial assets recognized in the individual balance sheets.

• (2) The maximum amount that the Company may be required to pay for the provision of financial guarantee without considering the probability.

The Company’s credit risk is mainly concentrated in the Company’s top four customers. As of December 31, 2021 and 2020, the percentage of total accounts receivable from the aforementioned customers was 67% and 43%, respectively.

3.

Liquidity risk

The company has supported the Group’s business operation and mitigated the impact of changes in cash flow by managing and maintaining sufficient cash and cash equivalent position. The Company’s management monitors the use of banking facilities and ensures the compliance of loan agreement.

• 61 -

(1) Liquidity and interest rate risk table of non-derivative financial liabilities

Non-derivative financial liabilities remaining contract maturity analysis is prepared in accordance with the Company’s undiscounted cash flow of financial liabilities on the possible earliest repayment date upon request. The following table shows the earliest times that the Company may be demanded to make immediate repayment of bank loans, without considering the likelihood of such demands. Maturity analysis of other non-derivative financial liabilities is prepared based on the agreed repayment date.

December 31, 2021

Non-derivative financial liabilities Note and account payables Other payables lease liabilities Floating rate instruments Fixed interest rate	Weighted average effective interest rate (%)	Less than 1 year	2–3 years	4to 5 years	Total
	- - 1.5 1,09078~1.15 0.858~0.9	$ 639,041 598,826 14,387 60,000 249,974	$ - - 15,702 290,000 -	$ - - 28 - -	$ 639,041 598,826 30,117 350,000 249,974

December 31, 2020

Non-derivative financial liabilities Note and account payables Other payables lease liabilities Floating rate instruments Fixed interest rate	Weighted average effective interest rate (%)	Less than 1 year	2–3 years	4 to5 years	Total
	- - 1.5 1.08656~1.15 -	$ 736,260 375,037 62,322 - -	$ - - 26,111 900,000 -	$ - - 1,504 - -	$ 736,260 375,037 89,937 900,000 -

Floating interest rate for the above-mentioned non-derivative financial liabilities will vary due to the differences of the floating interest rate and the interest rate estimated on the balance sheet.

(2) Financing limit

Financing limit
Unsecured bank loan amount Amount utilized Amount unutilized Secured bank loan Amount utilized Amount unutilized	December 31, 2021 $ 925,000 2,775,000 $ 3,700,000 $ 50,000 950,000 $ 1,000,000	December 31, 2020
			$ 611,000 3,089,000 $ 3,700,000 $ 600,000 600,000 $ 1,200,000

• 62 -

26. Related party transaction

Except for those disclosed in other notes, the transactions between the Company and its related parties are as follows

• (1) Name of related parties and the relations

Related Party Name Relation with the Company AMIGO LOGISTICS CORPORATION (AMIGO LOGISTICS) Subsidiary New Swell International Investment Co., Ltd. Subsidiary DEBAO HOME APPLIANCE CO., LTD. (DEBAO HOME APPLIANCE) Subsidiary SAMPO HOME INC. Subsidiary SAMPO JAPAN INC. Subsidiary NISSIN GLOBAL LOGISTICS (TAIWAN) CO., LTD. Sub-subsidiary DONGGUAN SAMPO ELECTRONICS CO., LTD. Sub-subsidiary NELONG ENTERPRISE CORPORATION LTD. Sub-subsidiary (NELONG Company) SAMPO INTERNATIONAL FOOD SERVICE CO., Sub-subsidiary LTD. RECHI PRECISION CO.,LTD. Affiliate Dyna Rechi Co., Ltd. Other affiliate Nucom International Corporation Other affiliate SYNVISION TECHNOLOGY SERVICE Other affiliate CORPORATION CINCHY CORPORATION Other affiliate Chen Zhang Xiu Ju Culture and Education Foundation Other affiliate Chen Mao-Bang Industry and Commerce Development Chairman of The Company Foundation

• (2) Operating revenues

Foundation Operating revenues
Account in book Operating revenues	Related party classification Subsidiary Sub-subsidiary Affiliate Other affiliate Chairman of The Company		2021 $ 489 281 309 3,653 1,934 $ 6,666		2020
					$ 2,258 245 929 6,087 928 $ 10,447

The sales policy for related parties is based on the general distribution price, and the collection policy is the same as that for general customers, except for the 120-day collection period for some related parties.

• (3) Purchase

Purchase
Account in book Purchase	Type and Name of related party Sampo Home Appliance Co., Ltd Sub-subsidiary Affiliate Other affiliate		2021 $ 2,378,655 239,875 11,484 3,021 $ 2,633,035		2020
					$ 2,362,552 219,644 2,966 3,294 $ 2,588,456

• 63 -

The purchase terms for the related parties are cost or cost plus 1% to 6.5% (including handling fee), while the rest of the raw materials and merchandises are better than the general manufacturers because the Company still needs to outsource the maintenance.

The Company’s collection and payment policy for DEBAO HOME APPLIANCE CO., LTD. is to settle at the end of each month other receivables arising from the purchase of materials or the advance of expenses on its behalf, accounts payable for finished goods purchased from it, and prepayments made in support of its operations, which are expressed as net accounts receivable.

• (4) Receivables from related party

Account in book Notes receivable Accounts receivable Other receivables	Related party classification Subsidiary Subsidiary Sub-subsidiary Other affiliate Sampo Home Appliance Co., Ltd SAMPO International Food Service Co., Ltd. Subsidiary	December 31, 2021 $ 6,801 $ 31 416 1 $ 448 $ 6,098 - 665 $ 6,763	December 31, 2020	December 31, 2020
				$ - $ 8 429 - $ 437 $ 1,494 2,600 343 $ 4,437

The outstanding receivables from the related party are without any guarantees collected.

• (5) Payables to concerned parties (excluding loans borrowed from concerned parties)

Account in book Accounts payable Other payables	Type and Name of related party AMIGO LOGISTICS CORPORATION Sub-subsidiary Affiliate Other affiliate AMIGO LOGISTICS CORPORATION	December 31, 2021 $ 100,145 14,529 499 262 $ 115,435 $ 15,604	December 31, 2020	December 31, 2020
				$ 81,919 36,017 1,277 1,260 $ 120,473 $ 11,693

For balance of payables to concerned parties outstanding, no guarantee has been provided.

• (6) Prepayments

provided. Prepayments
Type and Name of related party NELONG Company Sub-subsidiary	December 31, 2021 $ 34,435 416 $ 34,851	December 31, 2020
			$ 73,288 416 $ 73,704

• 64 -

• (7) Operating expenses (including freight, rental and other expenses, etc.)

Related party classification Subsidiary Sub-subsidiary Affiliate		2021 $ 235,945 13,648 49 $ 249,642		2020
				$ 235,266 8,321 175 $ 243,762

(8) Other income

Other income
Related party classification Subsidiary Affiliate		2021 $ 27,219 - $ 27,219		2020
				$ 17,582 3 $ 17,585

(9) Remuneration to key management

Total remuneration to directors and other key management for 2021 and 2020 was as follows.

was as follows.
Short-term employee benefits Pension benefits		2021 $ 43,742 1,070 $ 44,812		2020
				$ 47,215 989 $ 48,204

The salaries and remunerations to directors and other key management were defined by the Salary Committee in accordance with the personal performances and trends in the markets:

27. Pledged assets

The following assets had been provided as collateral for financing loans:

Guarantee items and assets Long-term borrowings Fixed asset	Content Land	Book value	Book value	Book value
		December 31, 2021 $ 97,277	December 31, 2020
				$ 518,816

28. Significant contingent liabilities and unrecognized contractual commitments

In addition to those described in other notes, the Company had the following material commitments and contingencies as of the balance sheet date.

• (1) As of December 31, 2021 and 2020, the Company had unused letters of credit of US$10,428 thousand and US$9,177 thousand, respectively, for the purchase of goods and materials.

• 65 -

• (2) During 2004, SAMPO CORPORATION sold a number of home appliances to dealer, one of which was sold by its parent company, to an end customer in the United States. The end customer later claimed that a fire caused by SAMPO’s appliances caused the damage caused by a fire in 2012 and sued dealer for compensations. Dealer and the customer had reached a settlement of their lawsuit, with paying compensation. Subsequently, Dealer filed an arbitration case with the American Arbitration Association, requesting SAMPO and Tianjin New Swell to compensate jointly and severally. The arbitration decision was rendered by the American Arbitration Association on February 3, 2016, which ruled that SAMPO and Tianjin New Swell should pay $3,052 thousand in compensation for the relevant losses. The arbitration decision was approved by the U.S. Federal Court on January 17, 2018, which recognized the arbitration decision, but dealer has not yet done anything concrete as of September 31, 2021, and SAMPO has not yet received any documents such as notice of the arbitration ruling that dealer has filed with the court in Taiwan.

In accordance with Article 47 Paragraph 2 of the Arbitration Law of ROC, the foreign arbitral decision shall have the same effect among the parties involved as the final judgment of the R.O.C. court if it is recognized by the R.O.C. court upon dealer’s application. On October 27, 2016, SAMPO received the Taiwan Taoyuan District Court’s 2016 Letter Zhu-Zi No. 15 for dealer’s application for recognition of the U.S. Arbitration Judgment, and based on the principle of conservatism, the Company has made a provision of $99,216 thousand for compensation in that year.

As a result of the aforementioned claim by dealer, SAMPO turned to its insurer, Chung Kuo Insurance Co., Ltd. (hereinafter referred to as Chung Kuo Insurance), to seek compensation. In accordance with the contents of the product liability insurance policy signed with Chung Kuo Insurance, SAMPO filed a lawsuit in the court, demanding Chung Kuo Insurance to fulfill the insurance contract and compensate for the delayed interest in this case. The result of the lawsuit was unfavorable as ruled by the Taipei District Court in 2019. In 2020, SAMPO filed an appeal for the second instance trial and the case is still pending at the Taiwan High Court.

• (3) The Company has signed a contract for the construction of the head office for an amount of NT$404,036 thousand. As of December 31, 2021, the Company had already paid NT$239,273 thousand and booked in the “Construction in Progress” account. The Company has signed a contract for the construction of Tainan factory for an amount of NT$369,668 thousand, As of December 31, 2021, the Company had already paid NT$198,936 thousand and booked in the “Construction in Progress” account. The Company has a contract signed for the construction of the park, underground parking lot, and other works in the Tucheng Development Project for an amount of NT$273,318 thousand. As of December 31, 2021, the Company had already paid NT$215,486 thousand and booked in the “Construction in Progress” account. The Company has signed a contract for the purchase of property, plant and equipment for NT$4,310 thousand. As of December 31, 2021, the Company had already paid NT$3,018 thousand and booked in the “Construction in Progress” account.

• 66 -

29. Other Matters

The Company assesses the prevalence of COVID-19 pandemic worldwide and in Taiwan and concludes that it does not have a significant impact on the Company’s ability to operate continuously.

30. Information of foreign currency assets and liabilities with significant effects

The following information is expressed in foreign currencies other than the functional currencies of each entity within the Company; also, the exchange rate disclosed refers to the exchange rate used for having such foreign currency converted into the functional currency. Foreign currency assets and liabilities with significant influence as follows:

December 31, 2021 Foreign currency assets Monetary items USD Foreign currency liabilities Monetary items USD December 31, 2020 Foreign currency assets Monetary items USD JPY Foreign currency liabilities Monetary items USD JPY	Foreign currency $ 8,183 1,200 Foreign currency $ 9,929 5,288 2,072 13,646	Unit: (Foreign currency/NT$1,000) Ending exchange rate Carrying amount 27.680 $ 226,499 27.680 33,230 Ending exchange rate Carrying amount 28.480 $ 282,765 0.2763 1,461 28.480 59,011 0.2763 3,770

• 67 -

The foreign exchange gains and losses (realized and unrealized) with significant impact are as follows:

Foreign currency USD	2021	Net exchange gain or loss ($ 1,772)	2020
	Average exchange rate 27.98 (USD:NTD)		Average exchange rate 31.26 (USD:NTD)	Net exchange gain or loss
		(		(	$ 14,117)

31. Notes of disclosure

• (1) Material transactions (2) and transfer investment information:

• Loans to others: none.

• Endorsements/guarantees for others: none.

• Marketable securities held at the end of the period (excluding investment in subsidiaries, affiliates and joint ventures): Exhibit 1.

• The cumulative purchase or sale of the same security for an amount exceeding NT$300 million or 20% of paid-in capital: None.

• The acquisition of real estate for an amount exceeding NT$300 million or 20% of paid-in capital: None.

• The disposal of real estate for an amount exceeding NT$300 million or 20% of paid-in capital: Exhibit 2

• The purchase or sale with the related party for an amount exceeding NT$100 million or 20% of paid-in capital: Exhibit 3.

• Receivables from related parties reaching $100 million or 20% of paid-in capital or more. Exhibit 4.

• Engagement in derivative transactions: None.

• Information on investees: Exhibit 5.

• (3) Information regarding investment in the territory of Mainland China:

• The name of the investees in Mainland China, principal business, paid-in capital, investment methods, capital outward and inward remittances, shareholding, investment gains and losses, investment carrying amount at the end of the period, repatriated investment gains and losses, and investment quota for Mainland China: Exhibit 6

• 68 -

• The following significant transactions with investees in Mainland China, directly or indirectly through third regions, and their prices, payment terms, and unrealized gains or losses: Exhibit 7

  • (1) Amounts and percentages of purchases and related payables at the end of the period.

  • (2) Amounts and percentages of sales and related receivables at the end of the period.

  • (3) Amount of property transaction and amount of the profit and/or loss so incurred.

  • (4) Balance and purposes of endorsements/guarantees or collateral provided at end of the term.

  • (5) The highest balance of fund financing balance at end of the term, range of interest rates and total amount of interest in the current term.

  • (6) Other transactions having significant effect upon profit and/or loss or financial standing of the current term, e.g. provision or acceptance of services.

• (4) Name, number and percentage of shares held by shareholders with 5% or more of the shares: Exhibit 8

• 69 -

Unit: Unless otherwise stated, NT$ thousand

SAMPO CORPORATION

Marketable securities held – end of period

December 31, 2021

Exhibit 1

Holding company	Types and names of securities	Relationship with the securities issuer	Account in book		End of the period	End of the period	End of the period			Remarks
				Number of shares/units (in thousands)	Carrying amount		Shareholding %		Fair value
SAMPO CORPORATION	Nucom International Corporation Chinese Television System Inc. WK ASSOCIATES LTD. Pushi Venture Capital Co., Ltd. WK VIII ASSOCIATES LTD. GRACE THW HOLDING MICROMAX INTERNATIONAL CORP. Cathay Capital Private Equity Limited Partner	Other affiliate － － － － － － －	Financial assets at fair value through other comprehensive income or loss – non-current 〞 〞 〞 〞 〞 〞 〞	882 7,581 15 225 477 2,178 3,380 -		$ 34,628 137,491 147 335 448 234,081 12,910 49,325 $ 469,365	4 4 1 2 2 1 19 24		$ 34,628 137,491 147 335 448 234,081 12,910 49,325 $ 469,365	@39.25 @18.14 @9.8 @1.49 @0.94 @107.49 @3.82

• 70 -

SAMPO CORPORATION

The disposal of real estate for an amount exceeding NT$300 million or 20% of paid-in capital

2021

Exhibit 2

Unit: Unless otherwise stated, amounts in NT$ Thousand

Company disposing property	Asset title	Date of event	Original acquisition date	Carrying amount	Trade value	The collection of proceeds	Capital gain/loss from disposition	Counterparties	Relation	Purpose of disposition	Reference for price determination	Other stipulations of the transaction
SAMPO CORPORATION	Land Lot No. 742-1 and No. 743, Daan Section, Tucheng District, New Taipei City	2021.7.30	1977.11.30	$ 680,718	$ 1,800,000	Full recovery	$ 1,068,412 (Note 1)	Goodman Group	None	Revitalization of company assets and efficient use of capital	The property is to be sold by price negotiation in accordance with the appraisal report of Euro-Asia Asset Evaluation Group and CHINA PROPERTY APPRAISING CENTER CO., LTD. and it is to be handled by the Chairman who is authorized by the board of directors.

Note 1: It is sold for an amount of NT$1,800,000 thousand net of the book value of NT$680,718 thousand and related commission expenses of NT$50,870 thousand. A disposal profit of NT$1,068,412 thousand is resulted.

• 71 -

SAMPO CORPORATION

Purchase from or sale to related parties for an amount exceeding NT$100 million or 20% of paid-in capital

2021

Exhibit 3

Unit: Unless otherwise stated, NT$ thousand

Purchase (sale) company	Counterparties	Relation		Transactions	Transactions		Trading terms different from general trade and reasons	Trading terms different from general trade and reasons	Notes and accounts receivable (payable)	Notes and accounts receivable (payable)	Remarks
			Purchase (sale)	Amount	Percentage of total purchase (sale)	The credit period	Unit price	The credit period	Balance	Percentage of total notes and accounts receivable (payable)
SAMPO CORPORATION	DEBAO HOME APPLIANCE CO., LTD. NELONG ENTERPRISE CORPORATION LTD.	Parent and Subsidiary Parent and Sub-subsidiary	Purchase Purchase	$ 2,378,655 158,723	43% 3%	Same as general suppliers Same as general suppliers	Cost plus 1% to 6.5% Cost plus 1% to 6.5%	－ －	－ Accounts payable ( $ 14,529 )	－ ( 2% )	Note 1

Note 1: As of December 31, 2021, SAMPO’s prepayment to NELONG ENTERPRISE CORPORATION LTD. was $34,435 thousand. Note 2: Related party transactions between consolidated entities have been adjusted and eliminated

• 72 -

SAMPO CORPORATION

Receivables from related party exceeds NT$100 million or 20% of the paid-in capital.

December 31, 2021

Exhibit 4

Unit: Unless otherwise stated, amounts in NT$ Thousand

Companies book in the “accounts receivable”	Counterparties	Relation	Balance of receivables from related parties	Turnover	Overdue receivables from related parties	Overdue receivables from related parties	Receivable collected from related parties after the period	Appropriation of allowance for loss
					Amount	Processing method
AMIGO LOGISTICS CORPORATION	SAMPO CORPORATION	Parent company	$ 100,145	2.44	$ -	-	$ 18,817	$ -

Note: The aforementioned transactions had been written-off while preparing the consolidated financial statements.

• 73 -

SAMPO CORPORATION

Information regarding investee’s name and location, etc.

December 31, 2021

Exhibit 5

Unit: Unless otherwise stated, NT$ thousand

Investor	Name of investee	Location	Principal business	Sum of initial investment	Sum of initial investment	Ending shareholding	Ending shareholding	Ending shareholding	Ending shareholding	Investee company Net income (loss)	Recognized investments for current period (loss) profit (Note 1)	Remarks
				Current period-end	Previous period-end	Number of Shares (in thousands)	Percentage	Carrying amount
SAMPO CORPORATION QUANBAO INVESTMENT CO., LTD. AMIGO LOGISTICS CORPORATION New Swell International Investment Co., Ltd. SAMPO HOME INC.	AMIGO LOGISTICS CORPORATION RECHI PRECISION CO.,LTD. New Swell International Investment Co., Ltd. QUANBAO INVESTMENT CO., LTD. DEBAO HOME APPLIANCE CO., LTD. SAMPO HOME INC. SAMPO JAPAN INC. Total AMIGO LOGISTICS CORPORATION RECHI PRECISION CO.,LTD. NELONG ENTERPRISE CORPORATION LTD. SAMPO INTERNATIONAL FOOD SERVICE CO., LTD. NISSIN GLOBAL LOGISTICS (TAIWAN) CO., LTD. AMIGO HOME LIFE CO., LTD. DONGGUAN SAMPO ELECTRONICS CO., LTD. SAMPO ASSET MANAGEMENT CO., LTD.	Taiwan Taiwan British Virgin Islands Taiwan Taiwan Taiwan Japan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan China Taiwan	Warehousing, transportation Compressor manufacturing, sales Investment holding Investment business Home appliance manufacturing and sales Real estate trading, leasing Marketing and Promotion Warehousing, transportation Compressor manufacturing, sales Electronics manufacturing and sales Food and beverage Warehousing, transportation Product installation and wholesale of electrics and electronic materials Manufacturing and sale of electrics and electrons equipment Real estate trading, leasing	$ 209,546 1,550,990 31,060 ( USD 1,000 ) 1,076,000 200,000 500,000 JPY 30,000 126,097 92,740 36,600 150,000 32,090 21,000 USD 1,400 10,000	$ 209,546 1,550,990 31,060 ( USD 1,000 ) 1,076,000 200,000 500,000 JPY 30,000 126,097 92,740 36,600 100,000 32,090 21,000 USD 1,400 10,000	21,155 135,610 1,000 114,325 20,000 50,000 3,000 10,366 4,136 3,660 15,000 2,550 2,100 1,400 1,000	49 27 100 100 100 100 100 24 1 61 100 51 100 70 100		$ 504,339 2,807,991 98,734 584,376 67,289 413,688 4,070 $ 4,480,487 247,599 105,597 63,392 81,897 20,566 23,155 USD 2,836 6,103	$ 160,958 542,921 17,353 57,215 ( 62,316 ) ( 6,610 ) ( 889 ) 160,958 542,921 29,293 ( 30,381 ) ( 903 ) 1,116 USD 1,125 ( 1,649 )	$ 77,132 145,779 17,353 31,469 ( 39,008 ) ( 6,610 ) ( 889) $ 225,226 38,453 4,448 17,869 ( 30,381 ) ( 460 ) 1,116 USD 788 ( 1,649 )	Note 2 Note 3 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 3 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2

Note 1: The investment income or loss recognized by the Company includes investment income or loss recognized for upstream transactions recorded in the book, net of dividends paid by the parent company to its subsidiaries. Note 2: Subsidiary included in the consolidated entities.

Note 3: Equity-method investee included in the consolidated financial statements.

Note 4: For the equity-method subsidiaries included in the consolidated financial statements, investment income or loss recognized under the equity method, and the net equity of the investee are fully eliminated.

• 74 -

Unit: Unless otherwise stated, NT$ thousand

SAMPO CORPORATION

Information regarding investment in the territory of mainland china

2021

Exhibit 6

Names of investees in China	Principal business	Paid-up capital	Mode of investments (Note 1)	Accumulated investment amount remitted at the beginning of the period	Amount of investment remitted or recovered in current period	Amount of investment remitted or recovered in current period	Accumulated investment amount remitted at the end of the period	Current period profit/loss of the investee	Ratio of shareholding of investment directly or indirectly made by the Company	Investment gain and loss recognized in current period (Note 2)	Book value of investment at ending	The investment income received at the end of the current period	Remarks
					Outward remittance	Recover
DONGGUAN SAMPO ELECTRONICS CO., LTD.	Manufacturing and sale of electrics and electrons equipment	USD 2 million	3	$ 42,180	$ -	$ -	$ 42,180	$ 31,484	70	$ 22,039 (Recognition basis B)	$ 78,498	$ -

Company name	Accumulated investment from Taiwan to Mainland China at ending	Amount of investment approved by Investment Commission of MOEA	Investment amount approved by the Investment Commission MOEAIC
SAMPO CORPORATION	$ 2,105,454	$ 2,437,870	$ 4,972,177

• Note 1: The investment methods can be divided into the following 5 types:

• To invest in Mainland China companies through remittance from a third area.

• To invest in Mainland China companies through a company invested and established in a third area.

• To invest in Mainland China companies through reinvesting in an existing company in a third area.

• To invest in Mainland China companies directly.

• Other methods.

• Note 2: For the field of recognized investment Income:

• (1) Please mark out if there has no investment gain or loss yet because the investment is still under planning.

• (2) The basis of recognition of investment income is classified into following three types, which should be marked out.

  • A. The financial statements have been audited by an international CPA firm with which CPA firms in the ROC. has a cooperative relationship.

  • B. Financial statements audited by the CPAs who audit the parent company in Taiwan.

  • C. Others

• Note 3: In accordance with the new regulations issued by the Investment Commission of the Ministry of Economic Affairs in August 2008, the Company’s investment limit in Mainland China is calculated as 60% of the net worth or consolidated net worth, whichever is higher.

• 75 -

SAMPO CORPORATION

The following significant transactions with investees in Mainland China, directly or indirectly through third regions, and their prices, payment terms, and unrealized gains or losses and other related information.

2021

Exhibit 7									Unit: Unless otherwise stated, NT$ thousand	Unit: Unless otherwise stated, NT$ thousand	Unit: Unless otherwise stated, NT$ thousand
Purchase (sale) company	Counterparties	Relation	Transaction type	Purchase (sale)		Terms and conditions			Notes and accounts receivable (payable)		Unrealized gain or loss
				Balance	Percentage (%)	Price	Payment term	Comparison with general transaction	Balance	Percentage (%)
SAMPO CORPORATION	DONGGUAN SAMPO ELECTRONICS CO., LTD.	Parent and Sub-subsidiary	Purchase	$ 81,152	1%	Cost or cost plus 1% to 6.5%	Same as general suppliers	Purchase price is better than general manufacturers	Accounts payable $ -	-	$ -

Note 1: Related party transactions between consolidated entities have been adjusted and eliminated

• 76 -

SAMPO CORPORATION and its Subsidiary

Information on Dominant Shareholders

December 31, 2021

Exhibit 8

Names of Dominant Shareholders	Share	Share
	Shareholding	Shareholding percentage
MACLADY INVESTMENT LTD.	32,954,800	8.51%

• Note 1: The information on major shareholders in this Exhibit is compiled by Taiwan Depository & Clearing Corporation based on the last business day of the quarter in which the shareholders held 5% or more of the Company’s common shares and preferred shares whose registration and delivery have been completed in non-physical form (including treasury shares). The number of shares recorded in the Company’s consolidated financial statements and the actual number of shares registered and delivered in non-physical form may differ depending on the basis of preparation of the calculations.

• Note 2: If a shareholder delivers his or her shares to a trust, the above information shall be disclosed by the individual trustor account opened by the trustee. As for the shareholder’s declaration of insider’s equity with more than 10% shares in accordance with the Securities and Exchange Act, the shareholding of the shareholder includes his or her own shares plus the shares that he or she has delivered to a trust and has the right to decide the use of the trust property, etc. Please refer to the Market Observation Post System for information on insider’s equity declaration.

• 77 -

Index of Important accounting title Statement

Item	No./Index
Statement of assets, liabilities and equity
Cash and cash equivalent Statement	Statement 1
Statement of Notes Receivable	Statement 2
Accounts receivable statement	Statement 3
Statement of Inventories	Statement 4
Statement of financial assets at fair value through other	Statement 5
comprehensive income – non-current.
Details of changes in accumulated impairment of	Statement 6
investments accounted for using the equity method
Statement of Changes in Right-of-Use Assets	Statement 7
Statement of Property, plant, and equipment	Note 12
Statement of Changes in the Accumulated	Note 12
Depreciation of Real Properties, Plants and
Equipment
Statement of Changes in the Accumulated Impairment	Note 12
of Real Properties, Plants and Equipment
Details of deferred income tax asset	Note 22
Statement of short-term borrowings	Statement 8
Statement of Notes Payable	Statement 9
Accounts payable statement	Statement 10
Statement of lease liabilities	Statement 11
Other payables statement	Note 16
Statement of Provision for liabilities – current	Note 17
Statement of long-term borrowings	Note 15
Statement of Provision for liabilities – non-current	Note 17
Details of deferred income tax liability	Note 22
Detail of profits and loss
Statement of Operating Income	Statement 12
Statement of Operating Cost	Statement 13
Statement of Service Cost	Statement 14
Statement of Manufacturing Overhead	Statement 15
Statement of Operating Expenses	Statement 16
Summary of employee benefits, depreciation, depletion	Statement 17
and amortization expenses incurred during the period
by function

• 78 -

SAMPO CORPORATION

Statement of Cash and cash equivalent

December 31, 2021

Statement 1 Item Cash on hand and working capital Bank deposits Demand (current) deposit Foreign currency demand deposit	Summary USD 2,194 thousand	Unit: NT$ thousand Amount $ 2,635 109,263 60,725 $ 172,623

Note: Ending exchange rate on December 31, 2021 USD:NTD=1:27.68

• 79 -

SAMPO CORPORATION

Statement of Notes Receivable

December 31, 2021

Statement 2

Unit: NT$ thousand

Name Guancheng Home Appliances Co., Ltd. CREATA CORPORATION Others (Note) Less: Allowance for losses	Summary Payment for goods 〃 〃		Amount
		(	$ 32,950 18,000 159,430 210,380 7,363) $ 203,017

Note 1: The amount less than 5% of the balance of this account is shown in aggregate. Note 2: This account balance includes notes receivable from related parties.

• 80 -

SAMPO CORPORATION

Accounts receivable statement

December 31, 2021

Statement 3

Unit: NT$ thousand

Name General accounts receivable PRESICARRE CORPORATION E-life Mall Corporation RT MART INTERNATIONAL LIMITED TSANN KUEN ENTERPRISE CO., LTD. JABIL CIRCUIT, INC JABIL CIRCUIT HUNGARY LTD Others (Note) Less: Allowance for losses	Summary Payment for goods 〃 〃 〃 〃 〃 〃		Amount
		(	$ 113,025 77,070 40,305 166,259 71,361 39,832 128,093 635,945 37,813) $ 598,132

Note 1: The amount less than 5% of the balance of this account is shown in aggregate. Note 2: The balance of this account includes accounts receivable from related parties.

• 81 -

SAMPO CORPORATION

Statement of Inventories

December 31, 2021

Statement 4

Unit: NT$ thousand

Name Material Work in progress Finished goods and merchandises (Note) Less: Allowance for loss on decline in value of inventories	Summary Air Conditioner Refrigerator LED Display LCD Display Washing Machine Small Electric Products Others		Cost $ 343,122 39,204 162,983 131,415 129,710 120,436 78,464 191,786 77,707 1,274,827 54,886) $ 1,219,941		Market price
		(			$ 325,273 39,204 156,214 125,957 124,323 115,434 75,206 183,821 74,509 $ 1,219,941

Note 1: The amount less than 5% of the balance of this account is shown in aggregate.

• Note 2: The lower of cost or net realizable value is determined by the category comparison method. Net realizable value is defined as the estimated selling price under normal circumstances less costs and selling expenses to completion.

• 82 -

SAMPO CORPORATION

Statement of financial assets at fair value through other comprehensive income – non-current. January 1 to December 31, 2021

Statement 5

Unit: NT$ thousand

Name Domestic unlisted Nucom International Corporation Chinese Television System Inc. WK ASSOCIATES LTD. Pushi Venture Capital Co., Ltd. WK VIII ASSOCIATES LTD. GRACE THW HOLDING MICROMAX INTERNATIONAL CORP. Cathay Capital Private Equity Limited Partner	At beginning Stock units Fair value 882 $ 31,576 7,581 103,392 299 4,671 899 7,084 867 4,352 2,178 255,357 3,380 12,471 - - $ 418,903	At beginning Stock units Fair value 882 $ 31,576 7,581 103,392 299 4,671 899 7,084 867 4,352 2,178 255,357 3,380 12,471 - - $ 418,903	Increase in	the period Amount $ - - - - - - - 50,000 $ 50,000	Decrease in the period Stock units Amount - $ - - - 284 2,841 674 6,743 390 3,901 - - - - - - $ 13,485	Decrease in the period Stock units Amount - $ - - - 284 2,841 674 6,743 390 3,901 - - - - - - $ 13,485	Unrealized gain or loss $ 3,052 34,099 ( 1,683 ) ( 6 ) ( 3 ) ( 21,276 ) 439 ( 675) $ 13,947	End of the period Stock units Fair value 882 $ 34,628 7,581 137,491 15 147 225 335 477 448 2,178 234,081 3,380 12,910 - 49,325 $ 469,365	End of the period Stock units Fair value 882 $ 34,628 7,581 137,491 15 147 225 335 477 448 2,178 234,081 3,380 12,910 - 49,325 $ 469,365	Collateral or pledge
	Stock units 882 7,581 299 899 867 2,178 3,380 -		Stock units - - - - - - - -		Stock units - - 284 674 390 - - -			Stock units 882 7,581 15 225 477 2,178 3,380 -
										None 〃 〃 〃 〃 〃 〃 〃

• 83 -

SAMPO CORPORATION

Statement of Long-term Investment Under Equity Method

January 1 to December 31, 2021

					January 1 to December 31, 2021	January 1 to December 31, 2021
Statement 6 Name Long-term investments accounted for using the equity method. AMIGO LOGISTICS CORPORATION RECHI PRECISION CO.,LTD. New Swell International Investment Co., Ltd. QUANBAO INVESTMENT CO., LTD. DEBAO HOME APPLIANCE CO., LTD. SAMPO HOME INC. SAMPO JAPAN INC. Less: Transfer to treasury stock	Beginning retained earnings Shares (in thousand shares) Amount 21,155 $ 451,538 135,610 2,739,654 1,000 82,360 114,325 1,010,618 20,000 103,259 50,000 420,298 3,000 5,627 ( 484,146) $ 4,329,208		Increase in	the period Amount $ - - - - - - - - $ -	Decrease in the period Shares (in thousand shares) Amount (Note 2) - $ 21,155 - 94,927 - - - - - - - - - - - - $ 116,082		Increase (decrease) in amount using the equity method (Note 3) $ 75,634 163,264 16,374 56,226 ( 35,970 ) ( 6,610 ) ( 1,557 ) - $ 267,361	Balance, ending			Unit: Unless otherwise stated, amounts in NT$ thousand Net market price or equity Collateral or pledge Amount Unit price (NTD) Total Amount (Note 1) $ 506,017 $ 506,017 None 2,807,991 19.1 2,590,154 〃 98,734 98,734 〃 1,066,844 1,066,844 〃 67,289 67,289 〃 413,688 413,688 〃 4,070 4,070 〃 484,146) ( 484,146) $ 4,480,487 $ 4,262,650
	Shares (in thousand shares) 21,155 135,610 1,000 114,325 20,000 50,000 3,000		Shares (in thousand shares) - - - - - - - -		Shares (in thousand shares) - - - - - - - -			Shares (in thousand shares) 21,155 135,610 1,000 114,325 20,000 50,000 3,000	Shareholding 49 27 100 100 100 100 100
		(					( ( (			(		None 〃 〃 〃 〃 〃 〃

Note 1: Based on the closing price of TWSE and TPEx on December 31, 2021.

Note 2: The decrease in the current period was due to the cash dividends paid by AMIGO LOGISTICS CORPORATION and RECHI PRECISION CO., LTD.

Note 3: Including the share of profit or loss of subsidiaries and affiliates recognized by the equity method, the share of other comprehensive income and the change in capital surplus.

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SAMPO CORPORATION

Statement of Changes in Right-of-Use Assets

December 31, 2021

Statement 7

Unit: NT$ thousand

Item Cost: Building Transportation equipment Total cost Accumulated depreciation: Building Transportation equipment Total accumulated depreciation		Beginning retained earnings $ 70,928 9,902 $ 80,830 $ 24,614 4,872 $ 29,486	Increase in the period $ - 4,982 $ 4,982 $ 21,664 3,764 $ 25,428		Decrease in the period $ - 2,473 $ 2,473 $ - 1,113 $ 1,113		Balance, ending
							$ 70,928 12,411 $ 83,339 $ 46,278 7,523 $ 53,801

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SAMPO CORPORATION

Statement of short-term borrowings December 31, 2021

Statement 8 Name Banking loans Banking loans	Summary Credit loan Credit loan	Balance, ending $ 100,000 50,000 $ 150,000	Lease contract term 2021/11/25-2022/06/08 2021/12/24-2022/01/24	Interest rate range (%) 0.900% 0.891%	Financing limit $ 200,000 800,000	Unit: NT$ thousand Mortgage or guarantee None None

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SAMPO CORPORATION

Statement of Notes Payable

December 31, 2021

Statement 9

Unit: NT$ thousand

Name GUO-LI CO., LTD. C.Y.LEE & PARTNERS ARCHITECTS / PLANNERS Others (Note)	Summary Payment for goods 〃 〃		Amount
			$ 43,415 4,010 2,323 $ 49,748

Note: The amount less than 5% of the balance of this account is shown in aggregate.

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SAMPO CORPORATION

Accounts payable statement

December 31, 2021

Statement 10

Unit: NT$ thousand

Name YOW-LIH-SHYANG INDUSTRY CO., LTD. MIDEA ELECTRIC TRADING Others (Note)	Summary Payment for goods 〃 〃		Amount
			$ 26,411 29,520 417,927 $ 473,858

Note: The amount less than 5% of the balance of this account is shown in aggregate.

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SAMPO CORPORATION

Statement of lease liabilities

December 31, 2021

Statement 11

Unit: NT$ thousand

Item Building Transportation equipment Less: Amount due in one year	Lease term 2019.01~2027.01 2019.01~2024.03	Discount rate 1.50% 1.50%		Amount
			(	$ 25,176 4,941 30,117 14,387) $ 15,730

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SAMPO CORPORATION

Statement of Operating Income

2021

Statement 12

Unit: NT$1,000/thousand Units

Item Electronic revenues Home appliance revenues Revenues from sale of materials Licensing revenue Service revenues Others Total operating revenues	Quantity 381,284 2,158,943		Amount
			$ 1,683,241 5,074,331 157,753 19,887 236,838 146,529 $ 7,318,579

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SAMPO CORPORATION

Statement of Operating Cost

2021

Statement 13

Unit: NT$ thousand

Item Inventory – beginning Add: Purchase in the period Transfer of finished products to raw materials Less: Inventory – ending Consumption of direct materials in the period Add: Direct labor Production overheads 1. Inputs in the period Add: Work in process – beginning Less: Work in process – ending 2. Cost of finished goods Add: Finished goods – beginning Less: Transfer of finished products to raw materials Requisition of finished goods Finished goods – ending 3. Finished goods operating costs Service materials – beginning Add: Purchase in the period Less: Service materials – ending Consumption of service materials in the period Merchandises – beginning Add: Purchase in the period Less: Requisition of merchandises Merchandises – ending Merchandise Operating costs Other operating costs Conversion costs service costs		Amount
		$ 208,958 910,902 219,404 268,427 1,070,837 11,914 44,802 1,127,553 33,663 39,204 1,122,012 148,933 219,404 8,587 168,143 874,811 54,989 182,693 56,846 180,836 632,947 4,465,398 20,868 687,321 4,390,156 60,278 11,946 271,699 $ 5,789,726

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SAMPO CORPORATION

Statement of Service Cost

2021

Statement 14 Item Salaries and Bonuses Labor expense Rental expense Other expenses (Note)	Unit: NT$ thousand Amount $ 165,515 18,012 18,537 69,635 $ 271,699

Note: The amount less than 5% of the balance of this account is shown in aggregate.

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SAMPO CORPORATION

Statement of Manufacturing Overhead

2021

SAMPO CORPORATION Statement of Manufacturing Overhead 2021
Statement 15 Item Salaries and Bonuses Labor insurance and national health insurance expenses Support expenses Utilities expenses Secondary conversion costs Other expenses (Note)	Unit: NT$ thousand Amount $ 9,847 2,641 8,164 2,439 9,474 12,237 $ 44,802

Note: The amount less than 5% of the balance of this account is shown in aggregate.

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SAMPO CORPORATION

Statement of Operating Expenses

2021

SAMPO CORPORATION Statement of Operating Expenses 2021	SAMPO CORPORATION Statement of Operating Expenses 2021	SAMPO CORPORATION Statement of Operating Expenses 2021
Statement 16 Unit: Unless otherwise stated, amounts in NT$ thousand Name Amount Salary and bonus $ 415,893 Transportation expenses 170,684 Advertising expenses 164,020 depreciation expense 69,146 Other expenses (Note) 331,533 $ 1,151,276
		$ 415,893 170,684 164,020 69,146 331,533 $ 1,151,276

Unit: Unless otherwise stated, amounts in NT$ thousand

Note: The amount less than 5% of the balance of this account is shown in aggregate.

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SAMPO CORPORATION

Statement of employee benefits, depreciation, depletion and amortization expenses

2021

Statement 17

Unit: NT$ thousand

Characteristics Employee benefits expenses Salaries and wages Labor insurance and national health insurance Pension expenses Remuneration to directors Other employee benefits expenses depreciation expense Amortization expenses		2021		Total $ 603,169 50,342 24,815 16,865 33,331 $ 728,522 $ 94,428 $ 38,626		2020
	Allocated as operating cost $ 187,276 20,654 13,217 - 11,415 $ 232,562 $ 25,282 $ -	Allocated as operating expenses $ 415,893 29,688 11,598 16,865 21,916 $ 495,960 $ 69,146 $ 38,626			Allocated as operating cost $ 181,341 19,292 13,389 - 11,307 $ 225,329 $ 28,001 $ -	Allocated as operating expenses $ 387,500 26,699 12,266 20,803 20,373 $ 467,641 $ 44,352 $ 39,545		Total
								$ 568,841 45,991 25,655 20,803 31,680 $ 692,970 $ 72,353 $ 39,545

• Note 1: The number of employees for the current year and the previous year were 687 and 679, respectively, of which the number of directors who were not also employees was 3 and 3, respectively.

• Note 2: (1) The average employee benefit expenses were $1,040 thousand and $994 thousand for 2021 and 2020, respectively.

• (2) The average employee salary expense was $882 thousand and $841 thousand in 2021 and 2020, respectively. Average employee salary expense increased by 4.88% for the 2 years.

• Note 3: The Company did not have supervisors in 2021 and 2020, therefore, there was no supervisor-related remuneration.

• Note 4: The Company’s remuneration policy for directors, managerial officers and employees is described below. Director

In accordance with the Company’s Articles of Incorporation, if the Company makes a profit in a year, the Company shall provide not less than 1% of the annual profit for employees and not more than 3% of the annual profit for directors, and shall provide reasonable remuneration in accordance with the resolution of the Company’s Remuneration Committee, taken into account the Company’s operating results and their contributions to the Company’s performance.

Managers

The remuneration policy of the General Manager and the Vice President is based on the relevant industry standards and the past performance of the Company. The payment standards, structure and system will be reviewed and adjusted from time to time in accordance with the actual operating conditions and changes in relevant laws and regulations and will not induce managerial officers to engage in actions that exceed the risk tolerance of the Company in pursuit of remuneration. The reasonableness of the relevant evaluations and salaries are reviewed by the Remuneration Committee and the recommendations made are submitted to the Board of Directors for discussion.

Employee

The remuneration plan is determined to maintain the competitiveness of the overall remuneration and to consider the operational performance and future development of the company. Implement a performance-based policy and offer differentiated rewards based on individual performance to reward the contributions of colleagues.

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