Scientech Corporation — Annual Report 2022

Nov 11, 2022

Stock Code: 3583

SCIENTECH CORPORATION

Parent Company Only Financial Statements and Independent Auditors’ Report 2022 and 2021

Address:11th Floor, No. 208, Ruiguang Road, Neihu District, Taipei City Tel: (02)8751-2323

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 1

For the convenience of readers, the independent auditors’ report and

the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ report and consolidated financial statements shall prevail.

§Table of Contents§

Item Page I. Cover 1 II. Table of Contents 2 III. Independent Auditors’ Report 3–6 IV. Parent Company Only Balance Sheet 7 V. Parent Company Only Statement of Comprehensive Income 8–10 VI. Parent Company Only Statement of Changes in Equity 11 VII. Parent Company Only Statement of Cash Flows 12–13 VIII. Notes to the Parent Company Only Financial Statements (I) Company History 14 (II) Date and procedures of approval of the financial statements 14 (III) Application of New Standards, Amendments, and Interpretations 14–15 (IV) Summary of significant accounting policies 15–27 (V) Significant Accounting Judgments, Assumptions, and Major Sources of Estimation Uncertainty 28 (VI) Description of Major Accounts 28–54 (VII) Related Party Transactions 55–59 (VIII) Pledged and Mortgaged Assets 59 (IX) Significant Commitments 59 (X) Significant Disaster Loss - (XI) Significant Subsequent Events - (XII) Others 59–60 (XIII) Supplementary Disclosures 1. Information on Major Transactions 60-65 2. Information on Investees 60, 66 3. Information on Investments in Mainland China 60, 67 4. Information on Major Shareholders 60, 68 (XIV) Segment Information - IX. Schedule of Major Accounts 69–79

Notes to the

Financial Statements - - - - - - - 1 2 3 4 5 6–24 25 26 27 - - 28–29 29 29 29 29 - -

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 2

Independent Auditors’ Report

To SCIENTECH CORPORATION:

Audit opinion

We have audited the parent company only balance sheet of SCIENTECH CORPORATION as of December 31, 2022 and 2021, and the parent company only statement of comprehensive income, parent company only statement of changes in equity and parent company only statement of cash flows for the period from January 1 through December 31, 2022 and 2021, and the notes to the parent company only financial statements (including the summary of significant accounting policies).

In our opinion, the parent company only financial statements were prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and thus presented fairly, in all material aspects, the financial position of SCIENTECH CORPORATION as of December 31, 2022 and 2021, and its parent company only financial performance and cash flows for the period from January 1 through December 31, 2022 and 2021.

Basis for Opinions

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and the Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Parent Company Only Financial Statements section of our report. We were independent of SCIENTECH CORPORATION in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China and fulfilled all other responsibilities thereunder. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those that, in our professional judgment, were of utmost significance in our audit of the parent company only financial statements of SCIENTECH CORPORATION for the year ended December 31, 2022. These matters were addressed in the context of our audit

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 3

of the parent company only financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these issues.

Key audit matters for SCIENTECH CORPORATION’s parent company only financial statements for the year ended December 31, 2022 are stated as follows: Revenue recognition

SCIENTECH CORPORATION’s 2022 operating revenue from manufacturing of machinery and from sale of machinery in the capacity of an agent is material to the overall presentation of the parent company only financial statements. Revenue from machinery should be recognized upon the fulfillment of obligations. Since the company might recognize product sale revenue when such revenue does not qualify for the recognition criteria, revenue recognition is thus listed as the key audit matter.

Our main audit procedures to address the said matter included testing the effectiveness of the design and implementation of the internal control system pertaining to the recognition of machinery sale and discussing with the management about whether the accounting policy for revenue recognition is appropriate and consistently adopted; we also sampled customer sales documents to verify the transaction terms on the order or sale contract and check the acceptance certificate signed off by customers, so as to assess the correctness of the recognized revenue.

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

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

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

Those charged with governance, including the audit committee, are responsible for overseeing SCIENTECH CORPORATION's financial reporting process.

Auditors' Responsibilities for the Audit of the Parent Company Only Financial Statements

Our objectives are to obtain reasonable assurance about whether the parent company only financial statements as a whole are free from material misstatement, whether due to fraud or

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 4

error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Standards on Auditing of the Republic of China will always detect a material misstatement when it exists in these parent company only financial statements. Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these parent company only financial statements.

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

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

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 SCIENTECH CORPORATION’s internal control.

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

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

5. Evaluate the overall presentation, structure and content of the parent company only financial statements, including the disclosures and whether or not the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 5

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

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements of SCIENTECH CORPORATION for the year ended December 31, 2021 and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Deloitte & Touche Taiwan CPA: MING-HSIN CHO

CPA: HUI-MIN HUANG

Approval No. from the Securities and Approval No. from the Financial Supervisory Futures Commission Commission Tai-Tsai-Cheng-Liu-Zi No. 0920123784 Jin-Guan-Zheng-Shen-Zi No. 1070323246

March 10, 2023

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 6

SCIENTECH CORPORATION

Parent Company Only Balance Sheet

As of December 31, 2022 and 2021

Unit: NT$ thousand

Code 1100 1170 1180 130X 1410 1470 11XX 1517 1550 1600 1755 1785 1840 1915 1975 1990 15XX 1XXX Code 2100 2130 2170 2219 2230 2252 2280 2399 21XX 2570 2580 2640 2670 25XX 2XXX 3110 3200 3310 3320 3350 3300 3410 3420 3400 3500 3XXX	Assets Current Assets Cash (Notes 4 and 6) Notes receivable and accounts receivable (Notes 4, 8, and 18) Accounts receivable - related parties (Notes 4, 8, 18, and 25) Inventories (Notes 4, 9, 22, and 25) Prepayments (Notes 25) Other current assets (Notes 13, 25, and 26) Total current assets Non-current assets Financial assets at fair value through other comprehensive income (Notes 4 and 7) Investments accounted for using equity method (Notes 4 and 10) Property, plant, and equipment (Notes 4, 11, and 22) Right-of-use assets (Notes 4 and 12) Patent right (Note 4) Deferred income tax assets (Notes 4 and 20) Prepayments for equipment (Note 11) Net defined benefit assets, non-current (Note 4 and 16) Other non-current assets (Note 13) Total non-current assets Total Assets Liabilitiesand Stockholders’ Equity Current liabilities Short-term borrowings (Note 14) Lease liability (Notes 4, 18, and 25) Notes payable and accounts payable (Note 25) Other payables (Note 11, 15, and 25) Current income tax liabilities (Notes 4 and 20) Short-term warranty provision (Note 4) Lease liability (Notes 4, 12, and 25) Other current liabilities Total current liabilities Non-current liabilities Deferred income tax liabilities (Notes 4 and 20) Lease liability (Notes 4, 12, and 25) Net defined benefit liability (Notes 4 and 16) Other non-current liabilities (Notes 4 and 10) Total non-current liabilities Total liabilities Equity (Notes 4 and 17) Capital stock Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Exchange differences arising in the translation of foreign operations Unrealized valuation gains or losses on financial assets at fair value through other comprehensive income Total other equity interests Treasury stock Total stockholders’ equity Total Liabilities and Equity		December 31,2022 Amount ％ $ 2,192,602 20 648,697 6 5,152 - 3,710,856 34 1,480,388 13 11,344 - 8,049,039 73 138,562 1 1,048,879 10 1,495,749 14 66,472 1 2,374 - 110,047 1 14,492 - 1,842 - 32,328 - 2,910,745 27 $ 10,959,784 100 $ 424,979 4 4,469,292 41 1,784,239 16 347,532 3 156,497 2 32,560 - 6,015 - 17,105 - 7,238,219 66 76,185 1 62,894 - - - - - 139,079 1 7,377,298 67 811,390 7 728,964 7 318,368 3 14,306 - 1,793,497 16 2,126,171 19 2,415 - 35,795) - 33,380) - 50,659) - 3,582,486 33 $ 10,959,784 100		December 31,2021	December 31,2021
			Amount $ 2,192,602 648,697 5,152 3,710,856 1,480,388 11,344 8,049,039 138,562 1,048,879 1,495,749 66,472 2,374 110,047 14,492 1,842 32,328 2,910,745 $ 10,959,784 $ 424,979 4,469,292 1,784,239 347,532 156,497 32,560 6,015 17,105 7,238,219 76,185 62,894 - - 139,079 7,377,298 811,390 728,964 318,368 14,306 1,793,497 2,126,171 2,415 35,795) 33,380) 50,659) 3,582,486 $ 10,959,784			％
		( ( (				19 11 1 26 7 - 64 3 13 17 1 - 1 1 - 36 100 4 28 13 5 2 - - - 52 1 1 - - 2 54 12 9 4 - 22 26 - - - ( 1) 46 100

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

Chairman of the Board: HUNG-LIANG HSIEH Manager: MING-CHI HSU Accounting Manager: SHAO-CHE CHUANG

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 7

SCIENTECH CORPORATION

Parent Company Only Statement of Comprehensive Income

January 1 to December 31, 2022 and 2021

Code Operating revenue (Notes 4, 18, and 25) 4100 Goods sales revenue 4600 Services revenue 4800 Other operating revenue 4000 Total operating revenue 5000 Operating cost (Notes 9, 19, and 25) 5900 Operating gross profit 5910 Unrealized gains on transactions with associates 5950 Realized operating gross profit Operating expenses (Notes 4, 8, 19, and 25) 6100 Marketing expenses 6200 General and administrative expenses 6300 R&D expenses 6450 Loss (Gain) on expected credit impairment 6000 Total operating expenses 6900 Operating Income Non-operating income and expenses 7010 Other income (Note 4, 7, and 25) 7020 Other gains and losses (Note 4) (Continued)		2022		％ 96 3 1 100 62 38 - 38 13 4 7 - 24 14 - -	Unit: NT$ thousand; except earnings per share 2021	Unit: NT$ thousand; except earnings per share 2021
						％
						96 4 - 100 61 39 ( 1) 38 12 3 8 ( 1) 22 16 1 -

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 8

(Continued)

Code 7050 Financial cost (Notes 4, 19, and 25) 7070 Share of profit or loss of associates and subsidiaries accounted for using equity method (Notes 4 and 10) 7100 Interest income (Notes 4 and 25) 7630 Exchange gains or losses (Notes 4 and 28) 7670 Gains (losses) on reversal of impairment (Notes 4 and 11) 7000 Total non-operating income and expenses 7900 Net profits before tax 7950 Income tax expenses (Notes 4 and 20) 8200 Net profit in the current year Other comprehensive (Note 4) Items that will not be reclassified to profit or loss 8311 Re-measurements of defined benefit plans (Note 16) 8316 Unrealized valuation gains or losses on investment in equity instruments at fair value through other comprehensive income 8349 Income tax related to items that will not be reclassified (Note 20) 8310 (Continued)		2022	％ - 1 - 2 - 3 17 3 14 - ( 1) - (1)	2021
		Amount ( $ 3,263 ) 34,511 8,783 60,680 102,423 695,382 126,799 568,583 1,896 ( 46,319) ( 379) (44,802)		Amount ( $ 3,029 ) ( 50,326 ) 794 ( 37,615 ) 25,313 ( 38,373) 511,848 91,943 419,905 451 10,524 ( 90) 10,885	％
					- ( 2 ) - ( 1 ) 1 ( 1) 15 3 12 - - - -

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 9

(Continued)

Code Items that will be reclassified to profit or loss 8380 Share of other comprehensive income of associates and subsidiaries accounted for using equity method (Note 10) 8399 Income tax related to items that might be reclassified (Note 20) 8360 8300 Other comprehensive income (net after tax) 8500 Total comprehensive income for the year Earnings per share (Note 21) 9710 Basic 9810 Diluted		2022	％ - - - (1) 13	2021
		Amount $ 34,068 6,823) 27,245 17,557) $ 551,026 $ 7.08 $ 7.00		Amount ( $ 16,321 ) 3,266 ( 13,055) ( 2,170) $ 417,735 $ 5.23 $ 5.19	％
	( (				- - - - 12

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

Chairman of the Board: Manager: Accounting Manager: HUNG-LIANG HSIEH MING-CHI HSU SHAO-CHE CHUANG

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 10

SCIENTECH CORPORATION

Parent Company Only Statement of Changes in Equity

January 1 to December 31, 2022 and 2021

Unit: NT$ thousand

Code A1 Balance January 1, 2021 M7 Changes in ownership interests in associates Earnings distribution for 2020 B1 Legal reserve B5 Cash dividends B17 Reversal of special reserves D1 2021 net income D3 Other comprehensive income (loss) after tax for 2021 Z1 Balance December 31, 2021 M7 Changes in ownership interests in associates Earnings distribution for 2021 B1 Legal reserve B3 Special reserves B5 Cash dividends D1 2022 net income D3 Other comprehensive income (loss) after tax for 2022 Z1 Balance as of December 31, 2022	Capital stock Thousand shares Amount 81,139 $ 811,390 - - - - - - - - - - - - 81,139 811,390 - - - - - - - - - - - - 81,139 $ 811,390	Capital stock Thousand shares Amount 81,139 $ 811,390 - - - - - - - - - - - - 81,139 811,390 - - - - - - - - - - - - 81,139 $ 811,390	Capital reserves $ 611,983 13,657 - - - - - 625,640 103,324 - - - - - $ 728,964		Retained earnings	Undistributed earnings $ 1,226,465 - ( 30,658 ) ( 148,606 ) 1,308 419,905 361 1,468,775 - ( 42,027 ) ( 2,531 ) ( 200,820 ) 568,583 1,517 $ 1,793,497	Other equity Exchange differences arising in the translation of foreign operations Unrealized valuation gains or losses on investment in equity instruments at fair value through other comprehensive income ( $ 11,775 ) $ - - - - - - - - - - - ( 13,055) 10,524 ( 24,830 ) 10,524 - - - - - - - - - - 27,245 ( 46,319) $ 2,415 ($ 35,795)	Other equity Exchange differences arising in the translation of foreign operations Unrealized valuation gains or losses on investment in equity instruments at fair value through other comprehensive income ( $ 11,775 ) $ - - - - - - - - - - - ( 13,055) 10,524 ( 24,830 ) 10,524 - - - - - - - - - - 27,245 ( 46,319) $ 2,415 ($ 35,795)	Treasury stock ( $ 50,659 ) - - - - - - ( 50,659 ) - - - - - - ($ 50,659)		Total stockholders’ equity
							Exchange differences arising in the translation of foreign operations ( $ 11,775 ) - - - - - ( 13,055) ( 24,830 ) - - - - - 27,245 $ 2,415
	Thousand shares 81,139 - - - - - - 81,139 - - - - - - 81,139			Legal reserves $ 245,683 - 30,658 - - - - 276,341 - 42,027 - - - - $ 318,368	Special reserves $ 13,083 - - - ( 1,308) - - 11,775 - - 2,531 - - - $ 14,306
								( (		$ 2,846,170 13,657 - ( 148,606 ) - 419,905 ( 2,170) 3,128,956 103,324 - - ( 200,820 ) 568,583 ( 17,557) $ 3,582,486

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

Chairman of the Board: HUNG-LIANG HSIEH

Manager: MING-CHI HSU Accounting Manager: SHAO-CHE CHUANG

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 11

SCIENTECH CORPORATION

Parent Company Only Statement of Cash Flows

January 1 to December 31, 2022 and 2021

Unit: NT$ thousand

Code Cash flow from operating activities A10000 Net profits before tax A20010 Income expenses A20100 Depreciation A20200 Amortization expenses A20300 Loss (Gain) on expected credit impairment A20900 Financial cost A21200 Income from interests A21300 Dividend Income A22300 Share of profit or loss of associates and subsidiaries accounted for using equity method A23100 Gain on disposal of investments A23700 Impairment loss on non-financial assets A23900 Unrealized gains on transactions with associates A24100 Unrealized exchange loss (gain) A29900 Defined benefit cost A30000 Net changes in operating assets and liabilities A31150 Notes receivable and accounts receivable A31160 Accounts receivable - related parties A31200 Inventories A31230 Prepayments A31240 Other current assets A32125 Contract liabilities A32150 Notes receivable and accounts receivable A32180 Other accounts payable A32200 Short-term warranty provision A32230 Other current liabilities A32240 Net defined benefit liabilities A33000 Cash flow from operating activities A33100 Interest received A33300 Interest paid A33500 Income taxes paid AAAA Net cash generated by operating activities (Continued)	2022 $ 695,382 105,767 324 5,503 3,263 ( 8,783 ) ( 800 ) ( 34,511 ) ( 1,284 ) 48,223 5,965 34,680 - 52,675 52,501 ( 1,989,646 ) ( 1,034,494 ) ( 986 ) 2,603,239 858,105 36,688 914 3,326 ( 100) 1,435,951 8,793 ( 3,227 ) ( 107,783) 1,333,734	2021
		$ 511,848 101,131 260 ( 28,555 ) 3,029 ( 794 ) 50,326 34,624 40,187 ( 7,350 ) ( 8,371 ) ( 123,646 ) ( 57,873 ) ( 1,038,548 ) ( 372,191 ) 732 1,354,946 563,226 93,628 6,113 4,695 ( 5,454) 1,121,963 846 ( 3,081 ) ( 60,767) 1,058,961

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 12

(Continued)

Code Cash Flow from Investing Activities B00010 Acquisition of financial assets at fair value through other comprehensive income B01900 Proceeds from disposal of investments accounted for using equity method B02700 Acquisition of property, plant and equipment B04100 Decrease in other accounts receivable - related parties B04500 Acquisition ofpatent right B06700 Increase in other non-current assets B07600 Dividends received BBBB Net cash used in investing activities Cash Flow from Financing Activities C00100 Increase in short-term borrowings C00200 Decrease in short-term borrowings C04020 Repayment of principal of lease liabilities C04400 Decrease in other non-current liabilities C04500 Cash dividends paid CCCC Net cash outflow from financing activities EEEE Net increase in cash E00100 Opening Balance E00200 Ending Balance	2022 ( $ 18,631 ) 1,868 ( 398,356 ) 5,000 ( 1,227 ) ( 12,348 ) ( 800) ( 422,894) 242,328 ( 59,170 ) ( 9,621 ) - ( 200,820) ( 27,283) 883,557 1,309,045 $ 2,192,602	2021
		( $ 155,726 ) - ( 66,915 ) 13,872 ( 3,285 ) - ( 212,054) 272,537 ( 249,933 ) ( 9,275 ) ( 34 ) ( 148,606) ( 135,311) 711,596 597,449 $ 1,309,045

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

Chairman of the Board: Manager: Accounting Manager: HUNG-LIANG HSIEH MING-CHI HSU SHAO-CHE CHUANG

SCIENTECH CORPORATION- Annual Report- IFRS Parent Company Only Financial Statements- 13

SCIENTECH CORPORATION

Notes to the Parent Company Only Financial Statements

January 1 to December 31, 2022 and 2021

(All amounts are in NT$ thousand unless otherwise specified)

1. Company History

The Company was incorporated in October 1979. Mainly engaged in the research and development, production, sales, and maintenance of process equipment for semiconductors, liquid crystal displays (LCDs), light-emitting diodes (LEDs), and solar power generation; wafer reclaim; and general import and export, the Company was listed on the Taiwan Stock Exchange (TWSE) in March 2013.

The parent company only financial statements are stated in the functional currency of the Company, which is New Taiwan Dollars.

2. Date and procedures of approval of the financial statements

The parent company only financial statements were approved at the Board meeting on March 10, 2023.

1. Application of New Standards, Amendments, and Interpretations

2. (I) First-time application of the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC interpretations (IFRIC), and SIC interpretations (SIC) (hereinafter collectively referred to as “IFRSs”) approved and promulgated by the Financial Supervisory Commission (hereinafter referred to as “FSC”) won’t cause any material changes to the Company’s accounting policies.

3. (II) Application of the FSC-endorsed IFRSs in 2023

Application of New Standards, Amendments, and Effective Date Announced Interpretations by IASB Amendments to IAS 1, “Disclosure of January 1, 2023 (Note 1) Accounting Policies” Amendments to IAS 8, “Definition of January 1, 2023 (Note 2) Accounting Estimates” Amendments to IAS 12, “Deferred Tax Related January 1, 2023 (Note 3) to Assets and Liabilities Arising from a Single Transaction”

• Note 1: The amendments shall apply to the annual reporting period beginning on or after January 1, 2023.

IFRS Notes -14-SCIENTECH CORPORATION

• Note 2: The amendments shall apply to the changes to the accounting estimates or policies occurring during the annual reporting period beginning on or after January 1, 2023.

• Note 3: This amendment requires entities to recognize a deferred tax liability for the temporary difference associated with lease and decommissioning obligations that arise on January 1, 2022 and is applicable to all transactions occurred after such date.

• As of the date when the parent company only financial statements were

• approved and issued, the Company assessed the said amended standards and interpretations and found them to have no significant effects on the Company’s financial position and financial performance.

• (III) IFRSs issued by the IASB but not yet approved and promulgated by the FSC

Application of New Standards, Amendments, and Effective Date Announced Interpretations by IASB (Note 1) Amendments to IFRS 10 and IAS 28, “Sale or To be determined Contribution of Assets between an Investor and its Associate or Joint Venture” Amendments to IFRS 16, Lease Liability in a Sale January 1, 2024 (Note 2) and Leaseback IFRS 17 “Insurance Contracts” January 1, 2023 Amendments to IFRS 17 January 1, 2023 Amendment to IFRS 17, “Initial Application of IFRS January 1, 2023 17 and IFRS 9—Comparative Information” Amendments to IAS 1, “Classification of Liabilities January 1, 2024 as Current or Non-current” Amendments to IAS 1, Non-current Liabilities with January 1, 2024 Covenants

• Note 1: Unless otherwise specified, the above-mentioned new/ amended/ revised standards or interpretation shall become effective in the annual reporting periods beginning on or after each effective date.

• Note 2: A seller-lessee is required to apply the amendments to IFRS 16 to any leaseback transactions arsing after the date of initial application of IFRS 16.

Up to the release date of the parent company only financial statements, the Company assessed the effects of the said amendments to the standards and interpretations on the financial position and performance on a continuous basis. The relevant effects will be disclosed after the assessment.

IFRS Notes -15-SCIENTECH CORPORATION

4. Summary of significant accounting policies

• (I) Compliance statement

• The parent company only financial statements were prepared in accordance with

• the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

• (II) Basis of preparation

Except for the financial instruments measured at fair value and the net defined benefit liabilities recognized at the present value of defined benefit obligations less the fair value of the plan assets, the parent company only financial statements were prepared on the basis of historical cost.

Fair value measurements are classified into Level 1, 2, and 3 based on the degree to which an input is observable and the significance of the input:

1. Level 1 inputs: The quoted price in an active market for identical assets or liabilities that is accessible on the measurement date (before adjustment).

2. Level 2 inputs: Other than quoted prices included in Level 1, the inputs that are observable for assets or liabilities directly (i.e. the price) or indirectly (i.e. inferred from the price).

3. Level 3 inputs: The inputs that are not observable for assets or liabilities.

When preparing the parent company only financial statements, the Group accounted for subsidiaries and associates using the equity method. To align the profit or loss, other comprehensive income, and equity in the parent company only financial statements with those attributable to owners of the Company stated in the consolidated financial statements, any differences resulting from the difference between parent company only basis and consolidated basis are adjusted through “Investment accounted for using equity method”, “Share of profit or loss of associates and subsidiaries”, “Share of other comprehensive income of subsidiaries and associates accounted for using equity method”, and other related equity items.

(III) Criteria for classification of assets and liabilities as current or non-current

Current assets include:

1. Assets that are held mainly for trading purposes;

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

3. Cash (excluding those that are restricted for being used for exchange or settlement of liabilities within 12 months after the balance sheet date).

4. Current liabilities include:

IFRS Notes -16-SCIENTECH CORPORATION

1. Liabilities that are held mainly for trading purposes;

2. liabilities that will be settled within 12 moths after the balance sheet date; and

3. liabilities whose due date cannot be unconditionally extended to more than 12 months after the balance sheet date.

Assets or liabilities that are not the above-mentioned current assets or current liabilities are classified as non-current assets or non-current liabilities.

• (IV) Foreign currency

When preparing the financial statements, the Company translated the transactions denominated in currencies other than its functional currency (i.e., foreign currencies) into its functional currency by applying the exchange rate prevailing on the transaction date.

Monetary items in foreign currencies are translated at the closing exchange rate on each balance sheet date. Exchange differences arising from settlement or translation of the monetary items are recognized in the profit or loss of the period.

Non-monetary items in foreign currencies measured at fair value are translated at the exchange rate prevailing on the date the fair value was determined. The exchange differences resulting therefrom are recognized in profit or loss of the period, or in other comprehensive income when changes in fair value of such items were designated to be recognized in other comprehensive income.

Non-monetary items in foreign currencies measured at historical cost are translated at the exchange rate on the date of transaction and are not retranslated.

During preparation of the parent company only financial statements, the assets and liabilities of the Company’s foreign operations (including the subsidiaries, associates, or branch companies of which the countries they operate or the currencies they use are different from those of the Company) are translated into NTD at the exchange rate prevailing on each balance sheet date. The income and expense items are translated at the average exchange rate of the period, and the exchange differences resulting therefrom are recognized in other comprehensive income. (V) Inventories

Inventories include raw materials, work-in-progress, finished goods, and products. Inventories are measured at the lower of cost and net realizable value. Cost and net realizable values are compared on an item by item basis, except inventories of the same category. Net realizable value refers to the estimated selling price in a normal situation less the estimated cost needed to complete the work and the

IFRS Notes -17-SCIENTECH CORPORATION

estimated cost needed to complete the sale. The weighted average method is used to calculate the inventory cost.

(VI) Investment in subsidiary

The Company accounted for investment in subsidiaries using the equity method. Subsidiaries are parent company only entities controlled by the Company.

Under the equity method, the investment is initially recognized at its costs and the amount of increase or decrease in the carrying amount of such investment after the date of acquisition depends on profits distributed and the Company’s shares of profit/loss and other comprehensive income in the subsidiaries. In addition, changes in subsidiaries’ other equity attributable to the Company are recognized according to the shareholding percentage.

(VII) Investment in associates

An associate refers to a company over which the Company has a significant influence and which is not a subsidiary or joint venture.

The Company accounts for its equity in an associate using the equity method.

Under the equity method, the investment in associates is initially recognized at its costs and the amount of increase or decrease in the carrying amount of such investment after the date of acquisition depends on the profits distributed and the Company’s shares of profit/loss and other comprehensive income in the associates and joint ventures. In addition, changes to the Group’s equity in the associates are recognized based on our shareholding ratio.

When the Company does not subscribe to new shares issued by associates based on its shareholding ratio, resulting in changes in the shareholding ratio and consequently to the net equity value of investment, the Company accounts for such changes by adjusting capital reserves - changes in the net equity of associates recognized under the equity method and investments under equity method. However, if subscription or acquisition of the shares is not based on the shareholding ratio, leading to a decrease in the Group’s ownership equity in the associates, the amounts related to the associate in other comprehensive income are reclassified according to the percentage of such decrease and treated with the same accounting treatment basis as the one which the associates' direct disposal of relevant assets or liabilities shall be in accordance with. If the said adjustment shall be debited to capital reserves, and the balance of capital reserves arising from investment under equity method is insufficient to be offset, the difference is debited to retained earnings.

IFRS Notes -18-SCIENTECH CORPORATION

When the Company’s shares of losses in the associates are equal to or exceed its equity in the associates (including the carrying amount of investment in the associate under the equity method and other long-term equities that in nature are part of the net investment portfolio made by the Company in the associate concerned) , the Company does not recognize further losses. The Company recognizes additional losses and liabilities only when any legal obligation or constructive obligation is incurred or the Company made payment on behalf of the associates.

For impairment evaluation, the Company tests the entire investment book value for impairment as a single asset by comparing the recoverable amount and book value of the investment. Any recognized impairment loss is also part of the investment book value. Any reversal of the impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increased.

The profit or loss generated from the upstream, downstream, and side stream transactions between the Company and the associates is recognized in the parent company only financial statements only when such profit or loss is irrelevant to the Company’s equity in the associates.

(VIII) Property, plant and equipment

Property, plant, and equipment are initially recognized at cost and subsequently at cost net of accumulated depreciation and accumulated impairment.

Each significant part of the property, plants, and equipment is separately depreciated on the straight-line basis over their useful life. The Company reviews the estimated useful life, residual value, and method of depreciation at least once before the end of each year and prospectively recognizes the effect from changes in accounting estimates.

When property, plant, and equipment is disposed of, the difference between the net disposal proceeds and the asset book value is recognized in profit or loss.

(IX) Patent right

Patent rights acquired separately are initially measured in accordance with the cost and subsequently based on the cost net of accumulated amortization and impairment losses. Patent rights are amortized on the straight-line basis over their useful life. The Company reviews the estimated useful life, residual value, and method of amortization at least once before the end of each year and prospectively recognizes the effects of changes in accounting estimates.

IFRS Notes -19-SCIENTECH CORPORATION

• (X) Impairments of property, plant, and equipment, right-of-use assets, and intangible assets

The Company assesses whether there are any signs indicating that any property, plant, and equipment, right-of-use assets, or intangible assets might be impaired on each balance sheet date. If any such indication exists, then the asset’s recoverable amount is estimated. When the recoverable amount of individual assets cannot be estimated, the Company estimates the recoverable amount of the cash-generating unit to which the assets belong. Corporate assets are allocated on a reasonable and consistent basis to the smallest group of cash-generating units

The recoverable amount is the higher of the fair value less costs of sale and the value in use. When the recoverable amount of any individual assets or cash-generating units is less than the book value, the book value of the individual assets or cash-generating units is adjusted down to the recoverable amount, and the impairment loss is recognized in profit or loss.

When the impairment loss is reversed subsequently, the book value of the asset or cash-generating unit is adjusted up to the revised recoverable amount. However, the increased book value shall not exceed the book value that would have been determined (net of amortization or depreciation) had no impairment loss been recognized in prior years. The reversal of the impairment loss is recognized in profit or loss.

• (XI) Financial instruments

Financial assets and financial liabilities are initially recognized in the parent company only balance sheet when the Company becomes a party to the instrument contract.

Financial assets or financial liabilities other than those measured at fair value through profit or loss are initially recognized at the fair value plus the transaction costs that can be directly attributed to acquisition or issuance of such financial assets or liabilities. Any transaction cost directly attributable to the acquisition or issuance of the financial assets or financial liabilities measured at fair value through profit or loss is immediately recognized in profit or loss.

1. Financial assets

The arms-length transactions of financial assets are recognized and derecognized using the transaction date accounting method.

• (1) Type of measurement

IFRS Notes -20-SCIENTECH CORPORATION

The Company’s financial assets include financial assets measured at fair value through profit or loss, financial assets measured at amortized cost, and investment in equity instrument measured at fair value through other comprehensive income.

A. Financial assets at fair value through profit or loss

Financial assets measured at fair value through profit or loss refer to those designated to be measured at fair value through profit and loss.

Financial assets are designated to be measured at fair value through profit or loss upon initially recognition if such designation could eliminate or materially reduce inconsistency in measurement or recognition.

Financial assets measured at fair value through profit or loss are measured at fair value; the dividends and interest derived therefrom are recognized in other income and interest income, respectively. Gains or losses from re-measurement are recognized in other gains and losses.

B. Financial assets at amortized cost

When the Company's invested financial assets meet both of the following two conditions, they are classified as financial assets measured at amortized cost:

• a. The financial assets are held within a business model whose objective is collecting contractual cash flows; and

• b. The contractual terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

After the initial recognition, the financial assets measured at amortized cost (including cash and cash equivalents and receivables [including those due from related party]) are measured at the amortized cost equal to the total book value determined under the effective interest method less any impairment losses, and any gain or loss from foreign currency translation is recognized in profit or loss.

IFRS Notes -21-SCIENTECH CORPORATION

Interest income is calculated as the effective interest rate times the total book value of financial assets, except under the following two circumstances:

• a. For purchased or originated credit-impaired financial assets, the interest income is calculated as the credit-adjusted effective interest rate times the amortized cost of the financial assets.

• b. For financial assets that are not purchased or originated credit-impaired but subsequently become credit-impaired, the interest income is calculated as the effective interest rate times the amortized cost of the financial assets, in all subsequent periods following the period in which the impairment occurred.

Financial assets are deemed to be credit-impaired upon the occurrence of significant financial difficulties confronting the issuer or debtor; default; or the circumstance that the debtor is likely to file for bankruptcy or other financial reorganization.

Cash equivalents include time deposits that are highly liquid, readily convertible to known amounts of cash, and subject to an insignificant risk of changes in value, and that mature within three months after the acquisition date; cash equivalents are used to meet short-term cash commitments.

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

At initial recognition, the Company may make an irrevocable election to measure the investment in equity instruments that are held not for trading, that are not recognized by the acquirer in a business merger, and that have no consideration, at fair value through other comprehensive income.

Investment in equity instruments measured at fair value through other comprehensive income is measured at fair value. Subsequent changes in the fair value are recognized in other comprehensive income and accumulated in other equity.

The dividends derived investment in equity instruments measured at fair value through other comprehensive income are recognized in profit or loss when the Company’s right to receive

IFRS Notes -22-SCIENTECH CORPORATION

dividends is determined, except under the circumstance that such dividends apparently represent a partial return of the investment cost. (2) Impairment of financial assets

The Company assesses impairment losses on the financial assets (including accounts receivable [including those due from related parties]) measured at amortized cost based on the expected credit losses on each balance sheet date.

Loss allowance for accounts receivable is recognized based on the lifetime expected credit losses. The Group first assess whether the credit risk on other financial assets significantly has increased after the initial recognition. When the increase is not significant, the loss allowance for the financial assets is recognized at the 12-month expected credit losses; when the increase is significant, the loss allowance is recognized at the lifetime expected credit losses.

Expected credit losses are the weighted average credit losses with the probability of default ('PD') as the weight. 12-month expected credit losses represent the expected credit losses on financial instruments from any potential default within 12 months after the reporting date. Lifetime expected credit losses represent the expected credit losses on financial instruments from any potential default during the expected lifetime.

For the purpose of internal credit risk management, financial assets are deemed to be defaulted when any of the following circumstance occurs, without consideration of the collaterals held:

• A. Any internal or external information indicates that a debtor is impossible to pay off the debts.

• B. Any contractual payment is overdue, unless any reasonable and supportable information demonstrates that a more lagging default criterion is more appropriate.

The impairment loss on all financial assets is deducted from the book value of the financial assets through their allowance account.

• (3) Derecognition of financial assets

The Company derecognizes a financial asset only when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction

IFRS Notes -23-SCIENTECH CORPORATION

in which substantially all of the risks and rewards of ownership of the financial asset are transferred to other entities.

For derecognition of the entire financial assets measured at amortized cost, the differences between the book value and the received consideration are recognized in profit or loss. For derecognition of the entire investments in equity instruments measured at fair value through other comprehensive income, the cumulative gain or loss is directly transferred to retained earnings and not reclassified as profit or loss.

1. Equity instruments

Equity instruments issued by the Company are recognized as the amount of consideration received, less the direct cost of issuance.

When a reacquired equity instrument is originally owned by the Company, the re-acquisition is recognized as a deduction to equity. Purchase, sale, issuance, or cancellation of the equity instruments owned by the Company are not recognized in profit or loss.

1. Financial liabilities

2. (1) Subsequent measurement

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

• (2) Derecognition of financial liabilities

For derecognition of financial liabilities, the differences between the book value and the consideration paid are recognized in profit or loss.

• (XII) Short-term warranty provision

The warranty obligation that ensures agreement between products and agreed specifications is management’s best estimate of the expenditure to settle the Company’s obligations, and is recognized at the time when revenue is recognized for underlying products.

• (XIII) Revenue recognition

After identifying the performance obligations under a contract with customers, the Company allocates the transaction price to each performance obligation and recognizes the allocated amount as revenue after each performance obligation is fulfilled. The Company’s revenue comes from equipment trading and wafer reclamation, and is recognized when products are accepted by customers; or when they are shipped or delivered to the place designated by customers, depending on the

IFRS Notes -24-SCIENTECH CORPORATION

contractual terms. Before being recognized as revenue, advance receipts are recognized as contract liability.

• (XIV) Lease

At inception of a contract, the Company assesses whether the contract is, or contains, a lease.

1. The Company is a lessor.

All leases are operating leases.

Lease payments from an operating lease are recognized as revenue on a straight line basis over the lease term.

1. The Company is a lessee

When the Company is a lessee, the lease payment from the leases of low-value underlying assets to which the exemption of recognition is applied and short-term lease is recognized in expenses on the straight-line basis over the lease term, while right-of-use assets and lease liabilities with respect to other leases are recognized on the lease commencement date.

The right-of-use assets are initially measured at cost (including the initial recognized amount of lease liabilities), and subsequently measured at the cost net of accumulated depreciation and accumulated impairment losses, adjusted for remeasurements of lease liabilities. Right-of-use assets are separately presented in the parent company only balance sheet.

Right-of-use assets are subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use assets or the end of the lease term.

Lease liabilities is initially measured at the present value of lease payment (fixed payments). If the interest rate implicit in a lease can be readily determined, the lease payments are discounted at the interest rate. When such interest rate cannot be readily determined, the lessee's incremental borrowing rate of interest is used.

Subsequently, the lease liabilities are measured at amortized cost under the effective interest method, and the interest expenses are amortized over the lease term. When future lease payments change as a result of a change in the lease term, the Company re-measures the lease liabilities and adjusts the right-of-use assets accordingly. However, the residual remeasurements are recognized in profit or loss when the book value of right-of-use assets is

IFRS Notes -25-SCIENTECH CORPORATION

reduced to zero. Lease liabilities are separately presented in the parent company only balance sheet.

• (XV) Government grants

Government grants may be recognized only when it is reasonable to ensure that the Company will comply with the conditions incidental to the government grants and the subsidies may be received affirmatively.

If the government grants are intended to make up for the expenses or losses that have occurred, or immediately finance the Company without incurring any future cost, such grants are recognized in profit or loss during the period when they can be received.

(XVI) Employee benefits

1. Short-term employee benefits

Short-term employee benefits are measured at non-discounted amount expected to be paid in exchange for the services to be provided by the employees.

1. Post-employment benefit

The pension contributed under the Defined Contribution Pension Plan is recognized in expenses during the period when employees provide services.

Defined benefit cost under the Defined Benefit Pension Plan is calculated actuarially using the projected unit credit method. Service costs and net interest on net defined benefit liabilities are recognized as employee benefit expenses when they are incurred. Remeasurements are recognized in other comprehensive income and presented in retained earnings when they occurred, and are not reclassified to profit or loss in subsequent periods.

(XVII) Income tax

Tax expenses are the total of current income tax and deferred income tax.

1. Current income tax

The additional income tax on undistributed earnings that is calculated according to the Income Tax Act of the Republic of China is recognized in the year when the related resolution is made at the shareholders’ meeting.

The adjustments to the income tax payable in the previous year are recognized in the current income tax.

1. Deferred income tax

IFRS Notes -26-SCIENTECH CORPORATION

Deferred income tax is calculated based on the temporary difference between the book value of assets and liabilities and the tax basis for calculation of taxable income.

Deferred income tax liabilities are generally recognized based on all taxable temporary differences; deferred income tax assets are recognized when taxable income sufficiently enough to offset the deductible temporary differences and loss carryforwards is highly likely in the future.

Taxable temporary differences related to investment in subsidiaries and associates are recognized in deferred income tax liabilities except that the Company can control the timing of reversal of the taxable temporary differences and that such differences are not likely to be reversed in the foreseeable future. A deferred tax asset is recognized for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilized in the foreseeable future.

The book value of deferred income tax assets is reviewed at each balance sheet date. When any of the deferred income tax assets is not likely to have adequate taxable income necessary for the recovery of all or part of the assets anymore, the book value thereof is reduced. Those that are not originally recognized in deferred income tax assets are reviewed at each balance sheet date. When any of those is likely to generate taxable income necessary for the recovery of all or part of the assets in the future, the book value thereof is increased.

Deferred income tax assets and liabilities are measured at the tax rate of the period in which the liabilities or assets are expected to be settled or realized. The tax rate is subject to the tax rate and tax law legislated or substantively legislated on the balance sheet date. The deferred income tax liabilities and assets are measured to reflect the tax consequences on the balance sheet date arising from the method that the Company expects to use to recover or settle the book value of the liabilities and assets.

1. Current and deferred income taxes

Current and deferred income taxes are recognized in profit or loss, or in other comprehensive income if they are related to the current and deferred income taxes designated to be recognized in other comprehensive income.

IFRS Notes -27-SCIENTECH CORPORATION

5. Significant Accounting Judgments, Assumptions, and Major Sources of Estimation Uncertainty

For adoption of the accounting policies, the management, based on historical experience and other relevant factors, must make judgments, estimates, and assumptions related to the information that cannot be readily acquired from other sources. The actual results may differ from those estimates.

The Company takes into account the development of the COVID-19 pandemic and its effect on the Taiwan economy when making significant accounting estimates for cash flows, growth rate, discount rate, and profitability. The management will continue to review the estimates and basic assumptions. When the changes in the estimates only affect the current period, they are recognized in the period in which they are made; when the changes in the estimates affect the current and future periods at the same time, they are recognized in the period in which they are made and in future periods.

Through an assessment, the management of the Company does not think an uncertainty exists in material accounting judgments, estimates, or assumptions.

6. Cash and cash equivalents

Cash and cash equivalents
Cash on hand and working capital Bank check and demand deposit Cash equivalents Time deposit	December31,2022 $ 505 1,762,003 430,094 $ 2,192,602	December31,2021
			$ 405 1,308,640 - $ 1,309,045

The annual interest rate for bank time deposits was 4.0% ~ 4.8% on December 31, 2022.

IFRS Notes -28-SCIENTECH CORPORATION

7. Financial assets at fair value through other comprehensive income

December 31, 2022 December 31, 2021 Investment in equity instruments measured at fair value through other comprehensive income Domestic investments Shares of TWSE-listed companies through private placement SPIROX CORP. $ 89,205 $ 112,237 Overseas investments Shares not traded on an exchange or OTC INFINITESIMA LIMITED 49,357 54,013 $ 138,562 $ 166,250

The Company invested in the common shares of the aforementioned companies according to its medium-term and long-term strategies, and expected to gain profits through long-term investment. Since the Company's management deemed that the recognition of short-term changes in the investment’s fair value in profit or loss was not consistent with the said long-term investment plan, they opted to have the investment measured at fair value through other comprehensive income.

The dividend income of NT$800 thousand (recognized under other income) by the Company in 2022 had to do with the shares held as of December 31, 2022.

8.

Notes receivable and accounts receivable (including those due from related parties)

Notes receivable Accounts receivable (including those due from related parties) Less: loss allowance	December31,2022 $ 1,904 679,467 681,371 27,522 $ 653,849	December31,2021	December31,2021
			$ 4,079 779,674 783,753 22,129 $ 761,624

The Company’s average credit period for sales of goods is 120 days on average. Accounts receivable paid within 60 days after the invoice date or the sale date won’t be charged any interest. If accounts receivable are not paid within 60 days, the Group will assess the credit status of each individual transaction party on a business month to measure possible gains or losses and reduce possible losses.

IFRS Notes -29-SCIENTECH CORPORATION

The Company recognizes the loss allowance for notes receivable and accounts receivable (including those due from related parties) based on the lifetime expected credit losses. The lifetime expected credit losses are calculated by considering the customer’s default record and current financial position, and the industrial and economic conditions. When there is any evidence showing that the trading counterparty is facing serious financial difficulties and the Company cannot estimate a reasonable recoverable amount, the Company directly writes off related notes receivable and accounts receivable, but will continue recourse activities. Any recovered amount through the recourse activities is recognized in profit or loss.

The Company recognizes the loss allowance for notes receivable and accounts receivable (including those due from related parties) as follows: December 31, 2022

ECL rate Total book value Loss allowance (lifetime ECL) Amortized cost December 31,		0–180 days		181–273 days		274–365 days	( (	366–540 days		541–730 days		More than 731 days		Total
	- $ 588,197 - $ 588,197 2021 0–180 days		(	5% $ 24,088 1,204) $ 22,884 181–273 days	(	10% $ 28,947 2,895) $ 26,052 274–365 days		45% $ 27,860 12,537) $ 15,323 366–540 days	(	70% $ 4,644 3,251) $ 1,393 541–730 days	(	100% $ 7,635 7,635) $ - More than 731 days	(	$ 681,371 27,522) $ 653,849 Total
ECL rate Total book value Loss allowance (lifetime ECL) Amortized cost
		- $ 670,624 - $ 670,624	(	5% $ 51,279 2,564) $ 48,715	(	10% $ 34,263 3,426) $ 30,837		45% $ 20,731 9,329) $ 11,402	(	70% $ 154 108) $ 46	(	100% $ 6,702 6,702) $ -	(	$ 783,753 22,129) $ 761,624

Changes in the loss allowance for notes receivable and accounts receivable (including those due from related parties) are as follows:

Balance - beginning of period Less: Impairment loss (reversed) in the year Balance - end of year		2022 $ 22,129 5,503 110) $ 27,522		2021
	(			$ 50,684 ( 28,555 ) - $ 22,129

The Company did not hold any collateral against the balance of notes receivables and accounts receivables (including those due from related parties).

Customers who individually account for 10% of the Company’s total accounts receivable (including those due from related parties) are as follows:

IFRS Notes -30-SCIENTECH CORPORATION

9.	Inventories Products Finished-goods Work-in-process Raw materials Cost of sales related to inventories Loss on inventory devaluation	December31,2022 Company A - December31,2022 $ 2,635,721 162,397 305,647 607,091 $ 3,710,856 2022 $ 2,562,491 $ 48,223	December31,2021	December31,2021
			Company A Company B December31,2021
				$ 1,207,567 100,902 254,892 214,904 $ 1,778,265 2021
				$ 2,180,340 $ 59,937

10. Investments accounted for using equity method

Investment in subsidiary Investment in associates (I) Investment in subsidiary Companies not listed on TWSE and TPEx SCIENTECH INVESTMENT CORP. TRANSCEND CAPITAL CORP. SCIENTECH GMBH ACROMASS TECHNOLOGIES, INC. SCIENTECH MATERIALS CORPORATION NATGEM INC.	December31,2022 $ 1,012,109 36,770 $ 1,048,879 December31,2022 $ 536,864 457,959 10,259 3,277 3,167 583 $ 1,012,109	December31,2021	December31,2021
		$ 841,560 41,974 $ 883,534 December31,2021
			$ 418,051 414,481 5,069 3,166 793 $ 841,560

The profit or loss of SCIENTECH MATERIALS for 2022 and 2021 was computed based on the financial statements for the same period that were not audited by CPAs. The profit or loss of subsidiaries accounted for using the equity method for

2022 and 2021 was computed based on their financial statements for the same periods that were audited by CPAs. The management of the Company didn’t think

IFRS Notes -31-SCIENTECH CORPORATION

that not having SCIENTECH MATERIALS’s financial statements audited by CPAs would cause any material impact.

Below are the Company’s ownership interests in subsidiaries and holding of voting shares in percentage terms on the balance sheet date:

SCIENTECH INVESTMENT CORP. TRANSCEND CAPITAL CORP. SCIENTECH GMBH(Note 1) ACROMASS TECHNOLOGIES, INC. SCIENTECH MATERIALS CORPORATION (Note 2) NATGEM INC.	December31,2022 100% 100% 100% 100% 100% 100%	December31,2021
		100% 100% 100% 100% 100% 100%

Note 1: As of December 31, 2021, the Company recognized a loss on investment in

• SCIENTECH GMBH, resulting in a credit balance of NT$9 thousand on investment accounted for using the equity method; such credit balance was recognized under other non-current liabilities.

• Note 2: SCIENTECH MATERIALS was dissolved through a resolution reached at the Board of Directors meeting dated August 31, 2021. As of December 31, 2022, the liquidation process was not yet completed.

(II) Investment in associates

December 31, 2022 December 31, 2021 Individually insignificant associate $ 36,770 $ 41,974

Although holding less than 20% of the shares of some individually insignificant associates, the Company has a representative in their board of directors and thus has significant influence over them.

The said investment accounted for using equity method, and the Company’s share of profit or loss and other comprehensive income in them were computed based on the financial statements not audited by CPAs. However, the management of the Company did not think that not having the financial statements audited by CPAs would cause any material impact.

IFRS Notes -32-SCIENTECH CORPORATION

Summary information on individually insignificant associates

The Company’s share Net profit (loss) for the year Other comprehensive income Total comprehensive income		2022 $ 4574) 46) $ 4,620)		2021
	( ( (			$ 1,530 9 $ 1,539

11. Property, plant and equipment

Cost Balance as of January 1, 2022 Increase Decrease Reclassification Balance as of December 31, 2022 Accumulated depreciation and impairment Balance as of January 1, 2022 Depreciation Decrease Reclassification Balance as of December 31, 2022 Net amount on December 31, 2022 Cost Balance January 1, 2021 Increase Decrease Reclassification Balance December 31, 2021 Accumulated depreciation and impairment Balance January 1, 2021 Impairment loss recognized Depreciation Decrease Reclassification Balance December 31, 2021 Net amount on December 31, 2021		Land $ 280,062 302,200 - - $ 582,262 $ 582,262 $ 280,062 - - - $ 280,062 $ 280,062	Buildings and structures $ 934,710 39,719 ( 21,918 ) - $ 952,511 $ 353,147 30,446 ( 21,918 ) - $ 361,675 $ 590,836 $ 935,942 9,983 ( 11,215 ) - $ 934,710 $ 336,989 - 27,373 ( 11,215 ) - $ 353,147 $ 581,563	Machinery and equipment $ 441,281 46,972 ( 12,485 ) 7,320 $ 483,088 $ 162,832 57,582 ( 12,485 ) ( 1,227) $ 206,702 $ 276,386 $ 589,971 17,007 ( 98,875 ) ( 66,822) $ 441,281 $ 241,535 ( 25,313 ) 58,209 ( 98,875 ) ( 12,724) $ 162,832 $ 278,449	Other facilities $ 32,281 12,588 ( 4,285 ) 285 $ 40,869 $ 10,983 7,642 ( 4,285 ) - $ 14,340 $ 26,529 $ 21,636 13,482 ( 2,837 ) - $ 32,281 $ 8,126 - 5,694 ( 2,837 ) - $ 10,983 $ 21,298	U n f i n i s h e d c o n s t r u c t i o n	Total
						$ - 19,736 - - $ 19,736 $ - - - - $ - $ 19,736 $ - - - - $ - $ - - - - - $ - $ -	$ 1,688,334 421,215 ( 38,688 ) 7,605 $ 2,078,466 $ 526,962 95,670 ( 38,688 ) ( 1,227) $ 582,717 $ 1,495,749 $ 1,827,611 40,472 ( 112,927 ) ( 66,822) $ 1,688,334 $ 586,650 ( 25,313 ) 91,276 ( 112,927 ) ( 12,724) $ 526,962 $ 1,161,372

IFRS Notes -33-SCIENTECH CORPORATION

Since the Company sold the machinery and equipment for which an impairment loss had been recognized, the Company recognized an impairment loss reversal gain of 25,313 thousand in 2021.

The Company’s property, plant, and equipment is solely for own use.

Depreciation is provided on a straight line basis over the following useful lives:

Buildings and structures
Plant and main structures	50 years
Electrical, plumbing & air
conditioning equipment	3–10 years
Machinery and equipment	5–10 years
Other facilities	3–5 years

The Company assessed the useful life of each significant component of property, plant, and equipment, and depreciated them individually.

Proceeds for acquisition of property, plant, and equipment include prepayments for equipment and equipment payables; Below is the reconciliation:

Increase in property, plant and equipment Increase (decrease) in prepayments for equipment Decrease (Increase) in equipment payables (presented under other payables)	2022 $ 421,215 ( 31,292 ) 8,433 $ 398,356		2021
		(	$ 40,472 45,056 18,613) $ 66,915

12. Lease agreement (I) Right-of-use assets

Right-of-use assets
Right-of-use assets, net Land Buildings and structures Other facilities Increase in right-of-use assets Depreciation expenses - Right-of-use assets Land Buildings and structures Other facilities	December31,2022 $ 64,584 987 901 $ 66,472 2022 $ 2,291 $ 3,942 4,116 2,039 $ 10,097	December31,2021
			$ 66,831 4,507 2,940 $ 74,278 2021
			$ 1,166 $ 3,730 4,086 2,039 $ 9,855

IFRS Notes -34-SCIENTECH CORPORATION

(II) Lease liabilities

Lease liabilities
Book value of lease liabilities Current Non-current	December31,2022 $ 6,015 $ 62,894	December31,2021
			$ 9,143 $ 67,096

The range of discount rates for lease liabilities is as follows:	The range of discount rates for lease liabilities is as follows:
	December31,2022	December31,2021
Land	2.00%~3.00%	2.00%
Buildings and structures	0.78%–0.98%	0.88%–1.03%
Other facilities	0.92%	0.92%–1.04%

• (III) Material lease activities and terms

The Company leased land from Chairman HUNG-LIANG HSIEH to construct buildings as offices under a lease contract that has a lease term of 5 years, will automatically renew upon expiration of a lease term, and gives the Company the option right to rent and buy the buildings. The Company may not sublease or consign the underlying assets of the lease, in whole or in part, unless otherwise agreed by the Lessor.

(IV) Other lease information

Other lease information
Short-term lease expense Total cash outflow from leases		2022 $ 4,838 $ 15,853		2021
				$ 3,594 $ 14,366

For property, plant, and equipment leases which qualify as a short-term lease, the Company elected to apply the recognition exemption to them and thus did not recognize right-of-use assets and lease liabilities for them.

13. Other assets

Other assets
Long-term prepayments Restricted assets Guarantee deposits paid Other receivables Others Current Non-current	December31,2022 $ 27,128 3,683 3,367 - 9,494 $ 43,672 $ 11,344 32,328 $ 43,672	December31,2021
			$ 13,210 3,683 4,936 5,282 8,237 $ 35,348 $ 15,368 19,980 $ 35,348

IFRS Notes -35-SCIENTECH CORPORATION

14. Short-term borrowings

Short-term borrowings
Unsecured loans Loans against letter of credits Credit loans Annual interest rate	December31,2022 $ 224,979 200,000 $ 424,979 0.50%–1.40%	December31,2021
		$ 44,642 200,000 $ 244,642 0.70%–0.75%

The terms pertaining to the credit limits of some of the Company’s bank borrowings mentioned above stipulate financial restrictions, with which the Company fully complied.

15. Other accounts payable

Other accounts payable
Salary and bonus payable Remuneration payable to employees and directors Equipment payable Others	December31,2022 $ 122,825 66,000 16,055 142,652 $ 347,532	December31,2021
			$ 109,407 55,000 24,488 129,075 $ 317,970

16. Post-employment benefit plan

(I) Defined contribution plan

The pension system that is specified in the “Labor Pension Act” and adopted by the Company is the defined contribution pension plan managed by the government. A pension equal to 6% of employee’s monthly wage shall be contributed to the personal labor pension account with the Bureau of Labor Insurance.

(II) Defined benefit plan

The pension system adopted by the Company according to the “Labor Standards Act” is the defined benefit pension plan managed by the government. The years of service rendered and the average wage of six months prior to the approved retirement date shall be the reference for calculation of the pension to be paid to the employee. The Company appropriates 3% of the total monthly wage of an employee as the pension and remits the amount to the Labor Pension Fund Supervisory Committee, which will deposit the amount in a dedicated account under its name with the Bank of Taiwan. Before the end of each year, if the assessed balance in the account is inadequate to make a full payment of pensions to the employees who may meet the

IFRS Notes -36-SCIENTECH CORPORATION

retirement conditions in the next year, the Company will make up the difference in one appropriation before the end of March in the following year. The account is managed by the Bureau of Labor Funds, Ministry of Labor, so the Company does not have the right to influence the investment management strategies.

The amounts of the defined benefit plan included in the parent company only balance sheet are listed as follows:

balance sheet are listed as follows:
Present value of defined benefit obligations Fair value of plan assets Net defined benefit liabilities (assets)	December31,2022 $ 5,103 ( 6,945) ($ 1,842)	December31,2021
	( (	(	$ 5,333 5,179) $ 154

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

Balance as of January 2022 Financial cost Recognized in profit or loss - interest expense (income) Remeasurements Return on plan assets (excluding the amount included in net interest) Actuarial gain - change in financial assumption Actuarial gain - experience adjustment Recognized in other comprehensive income Contribution by employer Balance as of December 31, 2022 Balance January 1, 2021 Service cost Previous service cost and settlement gains Recognized in profit or loss - interest expense (income) Recognized in profit or loss	Present value of defined benefit obligations $ 5,333 31 - ( 141 ) ( 120) ( 261) - $ 5,103 $ 42,967 ( 8,426 ) 170 ( 8,256)	Fair value of plan assets ($ 5,179) ( 31) ( 1,635 ) - - ( 1,635) ( 100) ($ 6,945) ($ 28,537) - ( 115) ( 115)		Net defined benefit liabilities
			$ 154 - ( 1,635 ) ( 141 ) ( 120) ( 1,896) ( 100) ($ 1,842) $ 14,430 ( 8,426 ) 55 ( 8,371)

IFRS Notes -37-SCIENTECH CORPORATION

Remeasurements Return on plan assets (excluding the amount included in net interest) Actuarial gain - change in financial assumption Actuarial loss - change in demographic assumption Actuarial loss - experience adjustment Recognized in other comprehensive income Contribution by employer Payment of benefits Balance December 31, 2021	Present value of defined benefit obligations - ( 1,002 ) 140 768 ( 94) - ( 29,284) $ 5,333	Fair value of plan assets ( 357 ) - - - ( 357) ( 928 ) 24,758 ($ 5,179)	Net defined benefit liabilities
			( 357 ) ( 1,002 ) 140 768 ( 451) ( 928 ) ( 4,526) $ 154

The Company is exposed to the following risks due to the pension system under

the “Labor Standards Act”:

1. Investment risk: The Bureau of Labor Funds, Ministry of Labor separately has invested the labor pension fund in domestic (foreign) equity and debt securities, and bank deposits. The investment is conducted at the discretion of the Bureau or under the mandated management. However, the profit generated from the Company’s plan assets shall be calculated with an interest rate not below the interest rate for a 2-year time deposit with local banks.

2. Interest rate risk: A decrease in the interest rates of government bonds leads to an increase in the present value of the defined benefit obligation, and the return on debt investment of the plan assets will be increased accordingly. The net defined benefit liabilities may be partially offset by both increases.

3. Salary risk: The present value of the defined benefit obligation is calculated with reference to the future salary of the plan participants. Therefore, the present value of the defined benefit obligation would be increased by an increase in the plan participants’ salary.

4. The Company’s present value of the defined benefit obligation was calculated

5. actuarially by a qualified actuary. The major assumptions on the date of measurement are as follows:

IFRS Notes -38-SCIENTECH CORPORATION

Discount rate Rate of expected salary increase	December31,2022 1.15% 3.00%	December31,2021
		0.60% 3.00%

If there was any reasonably possible change to the major actuarial assumptions separately, the resulting increase (decrease) in the present value of the defined benefit obligation in the situation where all the other assumptions remained the same is as follows:

is as follows:
Discount rate Increase by 0.25% Decrease by 0.25% Rate of expected salary increase Increase by 0.25% Decrease by 0.25%	December31,2022 ($ 62) $ 63 $ 56 ($ 55)	December31,2021
	( (	( (	$ 76) $ 78 $ 69 $ 68)

Since the actuarial assumptions might be correlated to each other and it is unlikely that a single assumption changes alone, the aforesaid sensitivity analysis might not reflect the actual changes in the present value of the defined benefit obligation.

	obligation.
17 (I)	Expected contribution within 1 year Average maturity of defined benefit obligations Equity Common Stock Number of authorized shares (thousand shares) Authorized capital Number of issued shares fully paid (thousand shares) Issued capital	December 31, 2022 $ 101 4 years December31,2022 100,000 $ 1,000,000 81,139 $ 811,390	December 31, 2021
			$ 101 5 years December31,2021
				100,000 $ 1,000,000 81,139 $ 811,390

A share of issued common stock had a par value of NTD10 and was entitled to one voting right and dividends.

IFRS Notes -39-SCIENTECH CORPORATION

(II) Capital surplus

1. 2.	Available for makeup of loss, distribution of cash dividends, or transfer into capital Additional paid-in capital Consolidation excess Treasury stock transactions Only available for makeup of loss Changes in equity of associates recognized under equity method	December31,2022 $ 468,714 29,831 25,617 524,162 204,802 $ 728,964	December31,2021	December31,2021
				$ 468,714 29,831 25,617 524,162 101,478 $ 625,640

1. These capital reserves may be used to make up losses, to distribute cash dividends, or to be transferred into the capital if the Company is not in the red. However, the amount of the transfer into the capital shall be limited to a certain percentage of the paid-in capital in every year.

2. Such capital reserves are either the effects of equity transactions recognized for changes in ownership interest in investees as a result of the Company’s falling to subscribe to or dispose of investees’ shares, or the adjustments of capital reserves of investees accounted for under the equity method.

3. (III) Retained earnings and dividend policy

According to the dividend policy prescribed in the Company’s Articles of Incorporation, in the event of surplus earnings after closing of annual accounts, due taxes shall be paid in accordance with the law, and losses incurred in previous years shall be compensated for. Upon completion of the preceding actions, 10% of the remainder surplus shall be allocated as legal reserves. However, in the event that the accumulated legal reserves are equivalent to or exceed the Company's total paid-in capital, such allocation may be exempted. The remainder may be set aside as special reserves, or the previous recognized special reserves may be reversed, in accordance with laws and regulations. If there is remainder surplus, the Board of Directors shall draft a surplus distribution proposal regarding the remainder of the surplus as well as accumulated undistributed surplus, shall decide whether to distribute the distributable dividends and bonus in cash or in shares, in whole or in part, by a supermajority resolution at a Board of Directors, and shall report its decision to the Shareholders'

IFRS Notes -40-SCIENTECH CORPORATION

Meeting. However, dividend distribution in the form of new shares shall be subject to a resolution of the Shareholders' Meeting. For the distribution policy governing employee and director remuneration that is prescribed in the Company's Articles of Incorporation, please refer to Note 19(4) Remuneration to employees and directors.

The Company’s dividend policy considers the environment it is in and the growth stage it is at. To cope with future capital requirements and long-term financial planning while maintaining shareholder interests and a balanced dividend policy, shareholder dividends will be distributed in shares or in cash, as appropriate, based on future capital expenditure requirements and the extent of dilution effect on earnings per share. Of the shareholder dividends distributed, no less than 10% shall be in cash. The actual distribution percentage shall be determined by the Board of Directors by considering the Company’s business planning, investment plan, capital planning, and the changes in internal and external environment.

Legal reserves may be used to make up for losses. Where the Company does not sustain loss, the part of the legal reserves that exceeds 25% of the total paid-in capital may be appropriated as capital or distributed in cash.

The Company provided or reversed special reserves by FSC’s official letter titled Jin-Guan-Zheng-Fa-Zi No.1010012865, and by Jin-Guan-Zheng-Fa-Zi No.1090150022 on or after the distribution of earnings for 2021.

The earnings distribution proposals for 2021 and 2020 are as follows:

Legal reserve Special reserves provided (reversed) Cash dividends Cash dividends per share (NT$)		2021 $ 42,027 $ 2,531 $ 200,820 $ 2.50		2020
			(	$ 30,658 $ 1,308) $ 148,606 $ 1.85

Proposals on the said cash dividends had been approved for distribution through a resolution at the Board of Directors meetings in March 2022 and March 2021. Other earnings distribution items had been approved through a resolution at the Board of Directors meetings in June 2022 and July 2021.

The earnings distribution proposal for 2022 drafted at the Board of Directors meeting dated March 10, 2023 is as follows:

IFRS Notes -41-SCIENTECH CORPORATION

Legal reserve Special reserve provision Cash dividends Cash dividends per share (NT$)		2022
		$ 57,010 $ 19,074 $ 289,181 $ 3.60

The said cash dividends had been approved through a resolution at a Board of Directors meeting. Other distribution items are still pending a resolution at the Shareholders’ Meeting to be held in June 2023.

• (IV) Treasury stock

Through a resolution at the Board of Directors meeting in September 2018, the Company decided to buy back 811 thousand treasury shares to transfer them to employees. The buyback was completed in October 2018, with an average buyback price of 62.47 dollars. As of December 31, 2022, such shares had yet to be transferred to employees.

According to the Securities and Exchange Act, the treasury shares held by the Company may not be pledged; nor may they be entitled to dividend distribution or voting rights.

18. Revenue

evenue
Goods sales revenue Manufacturing Sale in the capacity of an agent Services revenue Commission Maintenance Others Other operating revenue Contract balance		2022 $ 2,014,840 1,932,929 3,947,769 91,094 34,256 7,776 133,126 49,676 $ 4,130,571		2021
				$ 1,834,077 1,551,267 3,385,344 124,695 18,215 4,160 147,070 14,938 $ 3,547,352

Contract balance
Notes receivable and accounts receivable (including those due from related parties) (Notes 8 and 25) Contract liabilities	December 31, 2022 $ 653,849 $ 4,469,292	December 31, 2021 $ 761,624 $ 1,866,053		January 1, 2021
				$ 549,045 $ 511,107

IFRS Notes -42-SCIENTECH CORPORATION

Changes in contract liabilities mainly come from the difference between the points in time when the Company fulfills obligations and when customers make payments.

The amount that comes from the contract liabilities at the beginning of the year and the amount that comes from the revenue recognized in the year in which performance obligations were fulfilled are as follows:

Goods sales 19. Net profit (I) Financial cost Interest on bank borrowings Interest on lease liabilities (II) Depreciation and amortization Property, plant and equipment Right-of-use assets Summary of depreciation expenses by function Operating cost Operating expenses Summary of amortization by function General and administrative expenses (III) Employee benefit expenses Short-term employee benefits Post-employment benefit Defined contribution plan Defined benefit plan Summary by function Operating cost Operating expenses			2022 $ 981,414 2022 $ 1,869 1,394 $ 3,263 2022 $ 95,670 10,097 $ 105,767 $ 30,800 74,967 $ 105,767 $ 324 2022 $ 724,168 25,462 - 25,462 $ 749,630 $ 227,859 521,771 $ 749,630		2021
					$ 326,463 2021
					$ 1,532 1,497 $ 3,029 2021
					$ 91,276 9,855 $ 101,131 $ 29,651 71,480 $ 101,131 $ 260 2021
				(	$ 610,499 21,475 8,371) 13,104 $ 623,603 $ 199,318 424,285 $ 623,603

IFRS Notes -43-SCIENTECH CORPORATION

(IV) Remuneration to employees and directors

According to its Articles of Incorporations, the Company shall take the pre-tax profits inclusive of employee remuneration and director remuneration and allocate 5% – 15% of such profits as employee remuneration and another 2% or less as director remuneration. The Board of Directors meetings in March 2023 and 2022 resolved on the employee remuneration and director remuneration estimated for 2022 and 2021, respectively - shown as follows:

Amount Employee remuneration Directors' remuneration	2022 $ 58,000 8,000	2021
		$ 49,000 6,000

Any amount that changes after the approval and publication date of the annual parent company only financial statements is accounted for as changes in accounting estimates, and will be adjusted and recognized in the following year.

The actually distributed amount of employee remuneration and director remuneration for 2021 tallied with the amount recognized in the consolidated financial statements for 2021.

The actually distributed amount of employee remuneration and director remuneration for 2020 does not agree with the amount recognized in the parent company only financial statements for 2020 ; the resulting differences are recognized in the profit of loss of 2021.

in the profit of loss of 2021.
Amount actually distributed Amount recognized on the annual financial statements	2020年度
	E m p l o y e e r e m u n e r a t i o n $ 41,500 $ 41,500	D i r e c t o r s ' r e m u n e r a t i o n
			$ 4,873 $ 5,000

The information about remuneration to employees and directors determined by the Board of Directors may be viewed at TWSE’s Market Observation Post System (MOPS).

IFRS Notes -44-SCIENTECH CORPORATION

20. Income tax

• (I) Income tax recognized in profit or loss

Major components of income tax expenses:

			2022			2021
Current income tax
Tax incurred in the year		$	157,275		$	129,144
Adjustments for the
previous year	(		22,105)	(		21,622)
			135,170			107,522
Deferred income tax
Tax incurred in the year	(		8,371 )	(		15,579 )
Adjustments for the
previous year			-			-
	(		8,371)	(		15,579)
Income tax expenses
recognized in profit or loss		$	126,799		$	91,943

Reconciliation of accounting income and income tax is as follows:

(II) (III)	2022 Net profits before tax $ 695,382 Income tax expense derived from applying the pre-tax profit to the statutory tax rate $ 139,076 Expense and loss not deductible from tax 25 Tax exempt income 1,058 Additional levy on undistributed earnings 8,745 Adjustments for the previous year ( 22,105) Income tax expenses recognized in profit or loss $ 126,799 Income tax recognized in other comprehensive income 2022 Deferred income tax Tax incurred in the year －Translation from foreign operations ( $ 6,823 ) －Re-measurements of defined benefit plans ( 379) ( 7,202) Current income tax liabilities December31,2022 Current income tax liabilities Income tax payable $ 159,497		2021
		(	$ 511,848 $ 102,370 - 4,764 6,431 21,622) $ 91,943 2021
		$ 3,266 ( 90) $ 3,176 December31,2021
			$ 129,110

IFRS Notes -45-SCIENTECH CORPORATION

(IV) Deferred income tax assets and liabilities

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

Deferred income tax assets Temporary differences Allowance for inventory write-down Undistributed earnings of subsidiaries Unrealized gains on transactions with associates Provisions Unrealized exchange losses Allowance for doubtful accounts Others Deferred income tax liabilities Temporary differences Undistributed earnings of subsidiaries		2022	2022
	Balance - beginning of period $ 45,697 15,952 8,037 6,329 3,959 2,875 6,262 $ 89,111 $ 56,418	Recognized in profit or loss $ 9,644 10,860 1,193 183 4,304 1,284 ( 20) $ 27,448 $ 19,077	Recognized in other comprehensiv e income $ - ( 6,133 ) - - - - ( 379) ($ 6,512) $ 690	Balance - end ofyear
		(	( ( (		$ 55,341 20,679 9,230 6,512 8,263 4,159 5,863 $ 110,047 $ 76,185

Deferred income tax assets Temporary differences Allowance for inventory write-down Undistributed earnings of subsidiaries Unrealized gains on transactions with associates Provisions Unrealized exchange losses Allowance for doubtful accounts Impairment loss Others Deferred income tax liabilities Temporary differences Undistributed earnings of subsidiaries		2021	2021
	Balance - beginning of period $ 33,710 6,785 - 5,106 1,021 8,955 5,063 9,117 $ 69,757 $ 55,819	Recognized in profit or loss $ 11,987 6,836 8,037 1,223 2,938 ( 6,080 ) ( 5,063 ) ( 2,765) $ 17,113 $ 1,534	Recognized in other comprehensiv e income $ - 2,331 - - - - - ( 90) $ 2,241 ($ 935)	Balance - end ofyear
		( ( (			$ 45,697 15,952 8,037 6,329 3,959 2,875 - 6,262 $ 89,111 $ 56,418

IFRS Notes -46-SCIENTECH CORPORATION

• (V) Amount of deductible temporary difference and loss carryforwards of deferred income tax assets unrecognized in the parent company only balance sheet

December 31, 2022 December 31, 2021 Deductible temporary differences $ 7,000 $ 7,000

• (VI) Authorization of income tax

The Company's profit-seeking business income tax filings have been approved by the tax authority through 2018.

21. Earnings per share

Earnings per share
Basic earnings per share Diluted earnings per share Net profit in the current year Net profit of the Company Thousand shares Weighted average number of common shares used for calculating basic earnings per share Effect of potential diluted common shares: Employee remuneration Weighted average number of common shares used for calculating diluted earnings per share		2022 $ 7.08 $ 7.00 2022 $ 568,583 2022 80,328 895 81,223		Unit: NT$ 2021 $ 5.23 $ 5.19 2021 $ 419,905 2021 80,328 570 80,898

Where the Company may elect to distribute employee remuneration in shares or in cash, when calculating the diluted EPS, the Company assumes that all employee remuneration is distributed in shares and counts the potentially dilutive common shares - when deemed dilutive - in the weighted average number of shares outstanding. The Group continues to consider the dilutive effect of such potentially delusive common

IFRS Notes -47-SCIENTECH CORPORATION

shares when calculating the dilutive EPS before the number of share dividends is to be resolved on in the following year.

22. Non-cash transactions

In 2022 and 2021, the Company transferred property, plant, and equipment in the amount of 1,850 thousand and 79,420 thousand, respectively, to inventory costs, with an accumulated depreciation of 1,227 thousand and 12,724 thousand, respectively. In 2022 and 2021, the Company transferred 9,455 thousand and 12,598 thousand, respectively, from inventories to own-use property, plant, and equipment (refer to Note 11).

23. Capital risk management

The Company conducts capital management to ensure the Company can continue as a going concern while maximizing shareholders’ return by optimizing the liability and equity balances.

The Company’s capital structure is composed of its net debt and its equity.

The key management of the Company reviews its capital structure every year in terms of the cost and risks of each capital category. Based on the recommendation of the key management, the Company will balance its capital structure by paying dividends and issuing new debts or paying existing debts.

24. Financial instruments

• －

• (I) Fair value information financial instruments not measured at fair value

Management of the Company thinks that financial assets and financial liabilities not measured at fair value have a book value approximate to their fair value.

－ (II) Fair value information financial instruments measured at fair value on a recurring basis

IFRS Notes -48-SCIENTECH CORPORATION

1. Fair value hierarchy

December 31, 2022

Level 1 Level 2 Level 3 Total

Financial assets at fair value through other comprehensive income Investment in equity instruments Shares of TWSE-listed companies through private placement $ - $ 89,205 $ - $ 89,205 Foreign shares not traded on an exchange or OTC - - 49,357 49,357 $ - $ 89,205 $ 49,357 $ 138,562 December 31, 2021 Level 1 Level 2 Level 3 Total

Financial assets at fair value through other comprehensive income Investment in equity instruments Shares of TWSE-listed companies through private placement $ - $ 112,237 $ - $ 112,237 Foreign shares not traded on an exchange or OTC - - 54,013 54,013 $ - $ 112,237 $ 54,013 $ 166,250

There was no transfer of fair value measurements between Level 1 and Level 2 in 2022 and 2021.

1. Reconciliation of the financial instruments measured at Level 3 fair value 2022

2022
Financial assets Balance - beginning of period Purchase Recognized in other comprehensive income Balance - end of year	Financial assets at fair value through other comprehensive income
	Equityinstruments
	(	$ 54,013 18,631 23,287) $ 49,357

IFRS Notes -49-SCIENTECH CORPORATION

2021

2021
Financial assets Balance - beginning of period Purchase Recognized in other comprehensive income Balance - end of year	Financial assets at fair value through other comprehensive income
	Equityinstruments
		$ - 59,726 ( 5,713) $ 54,013

1. Level 2 fair value valuation techniques and inputs

If there is no quoted price for the common shares issued by domestic TWSE-listed companies through a private placement, such common shares are evaluated by using valuation techniques. The assumptions and estimates used by the Group for the valuation techniques are the same as the assumptions and estimates accessible to the Company that are used by market participants for quoting a price for financial products.

The valuation technique the Group used for measuring the fair value is the Black-Scholes pricing model.

1. Level 3 fair value valuation techniques and inputs

When valuing the foreign shares not traded on an exchange or OTC, the Group used the income approach by which the present value of benefits expected to be derived from such investment is calculated by discounting the cash flows. Significant unobservable inputs are as follows. When liquidity discount decreases, the fair value of such investment will increase.

==> picture [382 x 26] intentionally omitted <==

If the following inputs are changed to reflect reasonably possible alternative assumptions while other inputs are held constant, the amount of the fair value of equity investment will increase (decrease) by:

Liquidity discount Increase by 1% Decrease by 1%	December31,2022 ($ 728) $ 728	December31,2021	December31,2021
	(	(	$ 798) $ 798

IFRS Notes -50-SCIENTECH CORPORATION

(III) Type of financial instruments

Type of financial instruments
Financial assets Financial assets at amortized cost (Note 1) Financial assets at fair value through other comprehensive income Financial liabilities Financial liabilities at amortized cost (Note 2)	December31,2022 $ 2,853,501 138,562 2,556,750	December31,2021
		$ 2,084,570 166,250 1,449,612

• Note 1: The balance included financial assets measured at amortized cost such as cash and cash equivalents, notes receivable and accounts receivable (including those due from related parties), other receivables (presented under other current assets), restricted assets (presented under other current assets), and guarantee deposits paid (presented under other non-current assets).

• Note 2: The balance included the financial liabilities measured at amortized cost such as short-term borrowings, notes payable and accounts payable, other payables, and guarantee deposits received (presented under other non-current liability).

• (IV) Financial risk management purpose and policy

The Company’s financial instruments mainly comprise equity investment, receivables, payables, borrowings, and lease liabilities. The financial management department of the Company provides services for each type of business and supervises and manages the financial risks incidental to the Company’s operations by referencing the internal risk report in which risk exposure is analyzed based on the extent and extensiveness of risks. Such risks include market risk, credit risk, and liquidity risk.

The financial management department provides a report to the key management of the Company quarterly to reduce risk exposure.

The Company did not adopt hedge accounting.

1. Market risk

2. (1) Exchange rate risk

IFRS Notes -51-SCIENTECH CORPORATION

The Company is engaged in sales and purchase denominated in foreign currency, and thus is exposed to the exchange rate fluctuation risk.

For the book value of the Company’s monetary assets and monetary liabilities denominated in a currency other than the functional currency on the balance sheet date, refer to Note 28.

Sensitivity analysis

The Company is affected primarily by fluctuation in the exchange rate of USD.

The sensitivity analysis includes only the foreign currency monetary items outstanding, which are translated at the end of year by using an exchange rate that could be adjusted by a maximum of 1%. When TWD appreciates/depreciates by 1% against the USD, the effects on the pre-tax net profit stated in the parent company only financial statements for 2022 and 2021 will be NT$2,043 thousand and NT$7,153 thousand, respectively.

The exchange rate fluctuation mainly affects the Company’s bank deposits, as well as the payables and receivables denominated in USD that were still outstanding and were not hedged with a cash flow hedge on the balance sheet date.

• (2) Interest rate risk

The interest rate risk facing the Company mainly comes from the Company’s floating-rate bank deposits.

The book value of the financial assets and liabilities of the Company that were exposed to the interest rate risk on the balance sheet date is as follows:

follows:
With cash flow interest rate risk - Financial assets - Financial liabilities With fair value interest rate risk - Financial assets - Financial liabilities -Lease liabilities	December31,2022 $ 1,762,003 200,000 430,094 224,979 68,909	December31,2021
		$ 1,308,640 200,000 - 44,642 76,239

IFRS Notes -52-SCIENTECH CORPORATION

Sensitivity analysis

The following sensitivity analysis is based on the interest risk exposure of non-derivatives on the balance sheet date. Floating-rate liabilities are analyzed based on the assumption that the liability amount outstanding on the balance sheet date remains outstanding throughout the reporting period.

If interest rate increases/decreases by 1%, held other variables constant, the Company’s pre-tax profit in the parent company only financial statements for 2022 and 2021 will change by NT$15,620 thousand and NT$11,086 thousand, respectively.

1. Credit risk

The credit risk means the risk of causing financial loss to the Company because the trading counterparty defaults on contractual obligations. As of the balance sheet date, the Company’s maximum credit exposure to the financial loss caused by a trading counterparty’s defaulting on his/her performance obligations mainly lies in the book value of the financial assets recognized in the parent company only balance sheet.

According to its policy, the Company only trades with reputational counterparties and requires provision of collateral where necessary to reduce the risk of financial loss due to default.

The Company exposes to the credit risk, which mainly comes from the customers who individually account for 10% or more of the Company’s total accounts receivables. Refer to Note 8 for details.

3.

Liquidity risk

The Company manages and maintains sufficient cash to support business operations and reduce the effect of the fluctuating cash flow. The management of the Company monitors the use of bank financing facilities and ensures compliance with the terms of the loan contract.

Bank loans are one of the Company’s important sources of liquidity. For the bank financing facility that the Company has not used, refer to relevant descriptions in (2) below.

• (1) Liquidity and interest rate risks of non-derivative financial liabilities The maturity analysis of other non-derivative financial liabilities is

• compiled based on the agreed repayment date.

IFRS Notes -53-SCIENTECH CORPORATION

December 31, 2022

December 31, 2022
Non-derivative financial liabilities Non-interest bearing debt Floating rate Lease liabilities		1–3months	4 months – 1 year $ 19,917 - 5,348 $ 25,265			More than 1 year
		$ 2,336,833 200,396 1,977 $ 2,539,206		$ 19,917 - 5,348 $ 25,265		$ - - 73,260 $ 73,260

More information on the maturity analysis of lease liabilities:

Less than 1 year Lease liabilities $ 7,325 December 31, 2021 Non-derivative financial liabilities Non-interest bearing debt Floating rate Lease liabilities	Less than 1 year	Less than 1 year	Less than 1 year	2–5years $ 18,920 1–3months	6–10years	11–15years	16–20years
		$ 7,325
				$ 1,241,435 200,341 2,693
				$ 1,444,469

More information on the maturity analysis of lease liabilities:

Lease liabilities	Less than 1 year	Less than 1 year	2–5years $ 19,834	2–5years $ 19,834	6–10years	6–10years	11–15years	11–15years	16–20years	16–20years
		$ 10,522		$ 19,834		$ 22,800		$ 22,800		$ 13,300

(2) Credit limit of financing facilities

Unsecured bank loan limit (extendable upon mutual agreement) - Employed capital - Unemployed capital	December31,2022 $ 426,461 853,539 $ 1,280,000	December31,2021	December31,2021
			$ 246,872 1,233,128 $ 1,480,000

IFRS Notes -54-SCIENTECH CORPORATION

25. Related Party Transactions

In addition to those disclosed in other notes, transactions between the Company and related parties are described as follows.

• (I) Name and relationship of related party

Relationship with the Name of related party Company SCIENTECH MATERIALS CORPORATION (SCIENTECH MATERIALS) Subsidiary ACROMASS TECHNOLOGIES, INC. (ACROMASS) Subsidiary NATGEM INC. Subsidiary SCIENTECH GMBH (SC GMBH) Subsidiary SCIENTECH ENGINEERING USA CORP. (SCU) Subsidiary TRANSCEND CAPTTAL CORP. Subsidiary SCIENTECH ENGINEERING CORP. (SHANGHAI) Subsidiary SCIENTECH ENGINEERING (HONG KONG) LIMITED Subsidiary HUNG-LIANG HSIEH Chairperson FORWARD SCIENCE CORPORATION Associate XTEK SEMICONDUCTOR (HUANGSHI) CO., LTD. (XTEK SEMICONDUCTOR) Associate FORWARD SCIENCE PTE.LTD. Associate HONG LUN CULTRUAL CREATIVITY Same key management FUNDATION

• (II) Operating revenue

Operating revenue
General ledger account Goods sales revenue Other operating revenue	Name and type of related party Subsidiary Others Associate Subsidiary Others Associate		2022 $ 17,085 68,826 $ 85,911 $ 259 22,824 $ 23,083		2021
					$ 242 303,493 $ 303,735 $ 137 810 $ 947

The price and payment terms for a sale transaction between the Company and related parties are determined based on the terms mutually agreed upon.

IFRS Notes -55-SCIENTECH CORPORATION

(III) Purchase

Purchase
Name and type of related party Subsidiary SCU Others Associate		2022 $ 167,145 5,437 172,582 $ 172,582		2021
				$ 95,887 4,392 100,279 2,780 $ 103,059

The price and payment terms for a purchase transaction between the Company and related parties are determined based on the terms mutually agreed upon.

(IV) Contract liabilities

Contract liabilities
Name and type of relatedparty Associate XTEK SEMICONDUCTOR	December31,2022 $ 54,246	December31,2021
			$ 51,570

• (V) Receivables due from related parties (excluding funds loaned to related parties)

General ledger account Accounts receivable Other receivable (presented under other current assets)	Name and type of related party Associate XTEK SEMICONDUCTOR Subsidiary ACROMASS Others	December 31, 2022 $ 5,152 $ - 18 $ 18	December 31, 2021	December 31, 2021
				$ 55,711 $ 256 - $ 256

No guarantee was requested for the outstanding receivables due from related parties. The balance of the allowance for receivables due from related parties as of December 31, 2022 and 2021 were NT$377 thousand and NT$1,485 thousand, respectively. The allowance for receivables due from related parties that was provided (reversed) in 2022 and 2021 amounted to NT$(1,108) thousand and NT$1,485 thousand, respectively.

IFRS Notes -56-SCIENTECH CORPORATION

(VI) Payables due to related parties

General ledger account Payables due to related parties (presented under notes payable and accounts payable) Other accounts payable	Name and type of related party Subsidiary SCU Others Subsidiary Others Associate	December 31, 2022 $ 3,858 176 $ 4,034 $ 5,002 230 $ 5,232	December 31, 2021	December 31, 2021
				$ 22,137 - $ 22,137 $ 3,336 - $ 3,336

The outstanding balance of the payables due to related parties was not secured against collateral.

(VII) Prepayments

Prepayments
Name and type of relatedparty December31,2022 December31,2021 Subsidiary Others $ - $ 1,429 Lease agreements General ledger account Name and type of related party December 31, 2022 December 31, 2021 Lease liabilities Chairperson $ 65,509 $ 68,731 General ledger account Name and type of related party 2022 2021 Interest expenses (presented under financial cost) Chairperson $ 1,338 $ 1,401	December31,2021
Subsidiary Others Lease agreements General ledger account Lease liabilities General ledger account Interest expenses (presented under financial cost)			$ 1,429 December 31, 2021
				$ 68,731 2021
				$ 1,401

(VIII) Lease agreements

The rent charged for lease contracts signed between the Company and related parties was negotiated upon by referencing the market price; the payment term was the same as a general payment term.

IFRS Notes -57-SCIENTECH CORPORATION

(IX) Funds loaned to related parties

Funds loaned to related parties	Funds loaned to related parties
General ledger account Name and type of related party December 31, 2022 Other receivable (presented under Subsidiary other current assets) ACROMASS $ - Income from interests Name and type of relatedparty 2022 Subsidiary $ 18			December 31, 2021
			$ 5,000 2021
			$ 164

Loans between the Company and subsidiaries are unsecured loans with an interest rate close to the market interest rate. Such loans are expected to be repaid in full within one year. Through an assessment, there are not expected credit losses.

(X) Others

Others
General ledger account Type of relatedparty 2022 Rental income (presented under Subsidiary other income) ACROMASS $ - SCIENTECH MATERIALS - Others 36 Same key management 24 $ 60 Maintenance and repair (presented Subsidiary under operating cost) Others $ - Associate - $ - Operating expenses Subsidiary $ 21,190 Remuneration to key management 2022 Short-term employee benefits $ 55,086 Post-employment benefit 889 $ 55,975		2022				2021
						$ 702 183 36 - $ 921 $ 148 1,512 $ 1,660 $ 8,930 2021
					$ $	52,908 1,322 54,230

(XI) Remuneration to key management

IFRS Notes -58-SCIENTECH CORPORATION

The remuneration to directors and other key management was decided by the Remuneration Committee according to personal performance and market trends.

26. Pledged and Mortgaged Assets

The following assets were provided to the Custom Office as collateral against the bonded goods and the payments and performance obligation of manufacturers.

Pledged certificates of deposits (presented under other current assets)	December31,2022 $ 3,683	December31,2021	December31,2021
			$ 3,683

27. Significant Commitments

The Company’s letter of credits issued but not used that were intended for purchase of goods and machinery and equipment, and for performance guarantee were NT$1,482 thousand and NT$2,230 thousand as of December 31, 2022 and 2021, respectively.

28. Significant Assets and Liabilities Denominated in foreign currencies

The Groups’ significant financial assets and liabilities denominated in foreign currencies aggregated by the foreign currencies other than functional currencies, and the related exchange rates between foreign currencies and respective functional currencies, are as follows:

December 31, 2022

December 31, 2022
Foreign currency assets Monetary items USD EUR JPY Non-monetary items Subsidiaries accounted for using the equity method USD	Foreign currency $ 58,744 11,278 103,517 33,897	Exchange rate 30.71 (USD:TWD) 32.72 (EUR:TWD) 0.232 (JPY:TWD) 30.71 (USD:TWD)	Bookvalue
			$ 1,804,032 369,011 24,057 1,040,975

IFRS Notes -59-SCIENTECH CORPORATION

Foreign

	Foreign
Foreign currency liabilities Monetary items USD JPY EUR December 31, 2021	currency 52,090 258,135 698 Foreign currency $ 46,087 7,231 68,391 31,529 20,246 1,835 98,227	Exchangerate 30.71 (USD:TWD) 0.232 (JPY:TWD) 32.72 (EUR:TWD) Exchange rate 27.68 (USD:TWD) 31.32 (EUR:TWD) 0.241 (JPY:TWD) 27.68 (USD:TWD) 27.68 (USD:TWD) 31.32 (EUR:TWD) 0.241 (JPY:TWD)	Bookvalue
			1,599,684 59,991 22,845 Bookvalue
Foreign currency assets Monetary items USD EUR JPY Non-monetary items Subsidiaries accounted for using the equity method USD Foreign currency liabilities Monetary items USD EUR JPY
			$ 1,275,694 226,476 16,448 872,719 560,397 57,466 23,624

The realized and unrealized foreign currency exchange losses of the Company in 2022 and 2021 were NT$60,680 thousand and NT$(37,165) thousand, respectively. However, it was not feasible to disclose the exchange loss and gain of each significant foreign currency because the number of foreign currencies involved in foreign currency transactions varied.

29. Supplementary Disclosures

Except those disclosed in Appendix Table 1 through 8, there were no required disclosures.

IFRS Notes -60-SCIENTECH CORPORATION

SCIENTECH CORPORATION and Subsidiaries

Loans to others

2022

								2022
Appendix Table 1													Unit: NT$ thousand unless otherwise specified
No.	Lending company	Borrowing company	Financial account	Whether a related party or not	Highest amount in the year (Note 3)	Balance - end of year (Note 3)	Drawdown (Note 3)	Interest rate range (%)	Nature of loaning of funds	Business transaction amount	Reasons for the need of short-term financing	Appropriated allowance for bad debt	Collateral		Limit of loans to a single borrower (Notes 1 and 3)	Limit of total loaning of funds (Notes 2 and 3)
													Name	Value
0 1	The Company SCIENTECH ENGINEERIN G (HONG KONG) LIMITED	SCIENTECH MATERIALS CORPORATION NATGEM INC ACROMASS TECHNOLOGIES, INC. SCIENTECH ENGINEERING CORP.(SHANGH AI) SCIENTECH ENGINEERING USA CORP. SCIENTECH GMBH	Other receivables －Related party Other receivables －Related party Other receivables －Related party Other receivables －Related party Other receivables －Related party Other receivables －Related party	Yes Yes Yes Yes Yes Yes	$ 7,000 2,000 15,000 24,568 ( US$800 thousand ) 30,710 ( US$1,000 thousand ) 30,710 ( US$1,000 thousand )	$ - 2,000 8,000- 24,568 ( US$800 thousand ) 30,710 ( US$1,000 thousand ) 30,710 ( US$1,000 thousand )	$ - - - - 6,142 ( US$200 thousand ) -	1.7 1.2 1.2 1.7 1.2 1.2	Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing	$ - - - - - -	Working capital Working capital Working capital Working capital Working capital Working capital	$ - - - - - -	－ － － － － －	$ - - - - - -	$ 358,249 358,249 358,249 24,568 ( US$800 thousand ) 30,710 ( US$1,000 thousand ) 30,710 ( US$1,000 thousand )	$ 1,432,994 1,432,994 1,432,994 241,934 ( HKD61,436 thousand ) 241,934 ( HKD61,436 thousand ) 241,934 ( HKD61,436 thousand )

Note 1: The limit of loans to a single borrower is as follows:

1. The limit of loaning of funds to a single party with business relationship with Company should not exceed the total transactions amount between it and the Company. The said “Transaction amount” means the higher of purchase or sales therebetween.

2. Limit of loaning of funds to a company in need of short-term financing should not exceed 10% of the Company’s net worth.

3. Limit of loaning of funds to a foreign operation whose voting shares are fully held by the Company, either directly or indirectly, should exceed neither the amount approved by the Board of Directors nor the amount equal to 80% of the lending company’s net worth.

Note 2: The limit of total funds loaned to others is as follows:

1. Should not exceed 40% of the Company’s net worth.

1. The limit of total funds loaned by a foreign operation of which all the voting shares are directly or indirectly held by the Company should not exceed 80% of the foreign operation’s net worth.

Note 3: Converted at the exchange rate of US$1 against NT$30.71 and HKD$1 against NT$3.938 on December 31, 2022.

IFRS Notes -61-SCIENTECH CORPORATION

SCIENTECH CORPORATION and Subsidiaries

Making endorsements/guarantees for others

Appendix Table 2	Appendix Table 2					2022				Unit: NT$ thousand unless otherwise specified	Unit: NT$ thousand unless otherwise specified	Unit: NT$ thousand unless otherwise specified	Unit: NT$ thousand unless otherwise specified
No.	Endorser/guara ntor	Partybeingendorsed/guaranteed		Limit on endorsement/ guarantees provided for a single party (Notes 1 and 2)	Maximum balance for the period (Note 2)	Ending balance (Note 2)	Drawdown (Note 2)	Amount of endorsement/ guarantees collateralized by properties (Note 2)	Ratio of accumulated endorsement/ guarantee to net equity per latest financial statement(%)	Limit of endorsement/ guarantees collateralized by properties (Notes 2 and 3)	Guarantee provided by parent company to subsidiary	Guarantee provided by subsidiary to a parent company	Guarantee provided to entities in Mainland China
		Company name	Relationship
0 1	The Company SCIENTECH ENGINEER ING (HONG KONG) LIMITED	SCIENTECH ENGINEERING (HONG KONG) LIMITED SCIENTECH ENGINEERING CORP. (SHANGHAI)	Subsidiary Parent company	$ 1,791,243 151,209 ( HKD38,397 thousand )	$ 30,710 ( US$1,000 thousand ) 3,071 ( US$100 thousand)	$ 30,710 ( US$1,000 thousand ) 3,071 ( US$100 thousand)	$ - 3,071 ( US$100 thousand)	$ - 3,071 ( US$100 thousand)	0.9% 1.0%	$ 3,582,486 302,418 ( HKD76,795 thousand )	Y N	N Y	N Y

Note 1: The limit of endorsement and guarantee made by the Company or subsidiaries to a single entity should not exceed 50% of the entity’s net worth.

Note 2: Converted at the exchange rate of US$1 against NT$30.71 and HKD$1 against NT$3.938 on December 31, 2022.

Note 3: Should not exceed 100% of the Company’s or a subsidiary’s net worth stated on the financial statements.

IFRS Notes -62-SCIENTECH CORPORATION

SCIENTECH CORPORATION and Subsidiaries

Marketable Securities Held at the End of Period

December 31, 2022

Appendix Table 3

Unit: NT$ thousand

Investor	Type and name of marketable securities	Relationship with the securities issuer	General ledger account		End of year	End of year
				Shares	Book value	Shareholding Percentage (%)	Fair value	Remar ks
SCIENTECH CORPORATION SCIENTECH INVESTMENT CORP.	Shares HITEKCORPS CO., LTD. AUENTER TECHNOLOGY CORP. AMCHAEL-GRAPHICS CORP. PROMOS TECHNOLOGIES INC. INFINITESIMA LIMITED SPIROX CORP. Shares SIGLAZ	－ － － － － － －	Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through profit or loss	225,000 600,000 700,000 4,662 6,111,111 4,000,000 1,100,000	$ - - - - 49,357 89,205 -	3.19 13 33 - 9.30 3.40 15.80	$ - - - - 49,357 89,205 -	－ － － － － － －

Note: For information on investment in subsidiaries and associates, refer to Appendix Tables 6 and 7.

IFRS Notes -63-SCIENTECH CORPORATION

SCIENTECH CORPORATION and Subsidiaries

Acquisition of real property reaching NT$300 million or 20% of paid -in capital or more

2022

						2022
Appendix Table 4												Unit: NT$1,000 Acquisition purpose and state of use Other covenants For use as a factory to satisfy operating needs None
Real property buyer	Property name	Fact occurrence date	Transaction amount	Proceeds payment progress	Counter-party	Relationship	Information on the previous transfer of property where the counter-partyis a relatedparty				Pricing reference	Acquisition purpose and state of use	Other covenants
							Owner	Relationship with the issuer	Transfer date	Amount
SCIENTECH CORPORATI ON	Land and structures	2022/1/7	$ 313,255	Progressing in line with contractual terms	ThAI CHENG TANNERY CO., LTD.	Non - related party	－	－	－	$ -	HONG BANG REAL ESTATE APPRAISER	For use as a factory to satisfy operating needs	None

Note: The Company’s Board of Directors meeting dated January 7, 2022 resolved to purchase the factory and the land in Anding District of Tainan City; earnest money was paid upon execution of the contract on January 11, 2022, and the rest of the payment was fully made in March 2022, in which ownership w as also transferred.

IFRS Notes -64-SCIENTECH CORPORATION

SCIENTECH CORPORATION and Subsidiaries

Purchase or sale of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more

2022

Appendix Table 5

Unit: NT$ thousand

Purchase from (sale to)	Transaction counterparty	Relationship		Transaction details	Transaction details		Occurrence of transaction terms other than those for an arms-length transaction and reasons therefor	Occurrence of transaction terms other than those for an arms-length transaction and reasons therefor	Notes/Accounts receivable (payable)	Notes/Accounts receivable (payable)	Remarks
			Purchase (sales)	Amount	Ratio to total purchase (sales) (%) (Note)	Credit period	Unit price	Credit period	Balance	Ratio to total notes and accounts receivable (payable) (%)
SCIENTECH CORPORATION SCIENTECH ENGINEERING USACORP.	SCIENTECH ENGINEERING USA CORP. SCIENTECH CORPORATIO N	Subsidiaries parent company	Purchase Sales	$ 167,145 ( $ 167,145 )	4.1 ( 86.9 )	Net30 Net30	$ - -	－ －	( $ 3,858 ) 3,858	( $ 0.2 ) 67.1

Note: Refers to the ratio to total purchase (sales), or to total receivables or payables, of an individual company.

IFRS Notes -65-SCIENTECH CORPORATION

SCIENTECH CORPORATION and Subsidiaries

Name and Territory of Investees and Other Relevant Information

2022

Appendix Table 6

Unit: NT$ thousand unless otherwise specified

Name of investor	Investee	Region	Main business line	Original investment amount	Original investment amount	Shares	held at theperiod-end	held at theperiod-end	Profit or loss of investee in the period	Investment gains of losses recognized in theperiod	Remarks
				December 31, 2022	January 1, 2021	Shares	Percentage	Book value
SCIENTECH CORPORATION SCIENTECH INVESTMENT CORP. SCIENTECH ENGINEERING CORP.(SHANGHAI)	SCIENTECH INVESTMENT CORP. ACROMASS TECHNOLOGIES, INC. SCIENTECH MATERIALS CORPORATION NATGEM INC. SCIENTECH GMBH TRANSCEND CAPITAL CORP. FORWARD SCIENCE CORPORATION RENORIGIN INNOVATION INSTITUTE CO., LTD. FORWARD SCIENCE PTE. LTD. SIMPLE INVESTMENT CORP. SCIENTECH ENGINEERING USA CORP. SCIENTECH ENGINEERING (HONG KONG) LIMITED	Mauritius Taipei City Taipei City Taipei City Austria British Virgin Islands Miaoli County Taipei City Singapore Mauritius California , US Hong Kong	Investment General instrument and precision instrument manufacturing Manufacturing and sale of energy-efficient products Sale of food and supplies International trade Investment Maintenance service Sale of biotech products Trading and maintenance of semiconductor equipment and peripherals Investment Trading of semiconductor equipment and peripherals International trade	$ 171,775 270,000 205,000 33,000 1,163 416,829 19,600 14,030 11,944 150,663 (US$4,906 thousand) 9,213 (US$300 thousand) 5,968 (CNY1,354 thousand)	$ 171,775 270,000 205,000 33,000 1,163 416,829 20,000 14,030 11,944 150,663 (US$4,906 thousand) 9,213 (US$300 thousand) 5,968 (CNY1,354 thousand)	5,540,000 27,000,000 1,400,000 800,000 - 14,275,006 1,960,000 1,121,000 500,000 4,905,500 300,000 -	100 100 100 100 100 100 6 20 21 100 100 100	$ 536,864 3,277 3,167 583 10,259 457,959 28,561 8,209 - 505,380 (US$16,457 thousand) 28,926 (US$942 thousand) 302,418 (CNY68,608 thousand)	$ 86,774 ( 1,792) 1 ( 210) 9,840 ( 55,528) ( 52,350) ( 8,100) - 78,881 (US$2,647 thousand) 7,901 (US$265 thousand) 37,928 (CNY8,577 thousand)	$ 86,774 ( 1,792) 1 ( 210) 9,840 ( 55,528) ( 2,813) ( 1,761) - 78,881 (US$2,647 thousand) 7,901 (US$265 thousand) 37,928 (CNY8,577 thousand)	－ － (Notes 1 and 2) － － － (Note 2) (Note 2) (Note 2) － － －

Note 1: SCIENTECH MATERIALS was dissolved through a resolution reached at the Board of Directors meeting dated August 31, 2021. As of December 31, 2022, the liquidation process was not yet completed. Note 2: It was calculated based on financial statements in the same period that were not audited by CPAs.

＝ ＝ Note 3:The amount was converted using the exchange rate of US$1 $30.71 and RMB$1 $4.408 on December 31, 2022. Investment gains or losses were converted using the average exchange rate of US$1=29.805 and RMB$1=4.422 during January 1, 2022 and December 31, 2022.

IFRS Notes -66-SCIENTECH CORPORATION

SCIENTECH CORPORATION and Subsidiaries

Information on Investments in Mainland China

2022

Appendix Table 7

Unit: NT$ thousand unless otherwise specified

Investee in Mainland China	Main business line	Paid-in Capital (Note 1)	Paid-in Capital (Note 1)	Method of investment	Accumulated amount of investments from Taiwan at the beginning of current year (Note 1)	Accumulated amount of investments from Taiwan at the beginning of current year (Note 1)	Amount of investments remitted or recovered in currentyear	Amount of investments remitted or recovered in currentyear	Accumulated amount of investments from Taiwan at the end of current year (Note 1)	Profit or loss of investee in the year (Note 2)	The Company’s shareholding of direct or indirect investment (%)	Investment gains of losses recognized in the year (Note 2)	Investment book value at the end of the year (Note 2)	Profit received from investments as of the end of current year
							Remitted	Recovered
SCIENTECH ENGINEERING CORP.(SHANG HAI) XTEK SEMICONDUCT OR (HUANGSHI) CO., LTD.	Trading and maintenance of semiconductor equipment and peripherals Trading of semiconductor equipment and peripherals	$ 149,558 ( US$4,870 thousand ) 2,545,431 ( US$82,886 thousand )		Invested in a China investee through another investee in a third region (Note 3) Invested in a China investee through another investee in a third region (Note 4)	$ 149,558 ( US$4,870 thousand ) 438,182 ( US$14,268 thousand )		$ - -	$ - -	$ 149,558 ( US$4,870 thousand ) 438,182 ( US$14,268 thousand )	$ 78,893 ( 318,577 )	100 17.21	$ 78,893 ( 61,100 )	$ 505,948 457,968	$ - -
						Limit on the amount of investments in Mainland China specified by the Investment Commission, MOEA $2,149,492
Accumulated amount of investments from Taiwan to Mainland China at the end of current period(Note 1)			Investment amount approved by the Investment Commission, MOEA (Note 1)			Limit on the amount of investments in Mainland China specified by the Investment Commission, MOEA
$587,740（US$19,138 thousand）			$587,740（US$19,138 thousand）			$2,149,492

Note 1: Converted at the exchange rate of US$1 against NT$30.71 on December 31, 2022.

Note 2: It was calculated based on financial statements in the same period that were audited by CPAs.

Note 3: Investment in SCIENTECH ENGINEERING CORP. (SHANGHAI) via SIMPLE INVESTMENT CORP.

Note 4: Investment in XTEK SEMICONDUCTOR (HUANGSHI) CO., LTD. via TRANSCEND CAPITAL CORP.

Note 5: The balance of unrealized gains as of Decemb er 31, 2022 in the amount of NT$46,152 thousand was arising from sale of machinery and equipment and provision of services to XTEK SEMICONDUCTOR (HUANGSHI) CO., LTD. Realized gross profit during January 1, 2022 and December 31, 2022 was NT$3,590 thousand.

IFRS Notes -67-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Information on Major Shareholders

December 31, 2022

Appendix Table 8

Name of major shareholder	Shares	Shares
	Number of shares held(shares)	Ownership
HUNG-LIANG HSIEH FEN-CHING HSIEH-CHIU FULLWAY INVESTMENT CORPORATION PARADIGM INVESTMENTCORP.	7,943,455 6,095,072 5,600,292 4,892,721	9.79% 7.51% 6.90% 6.03%

Note: The information on major shareholders are acquired from the data of the Taiwan Depository & Clearing Corporation with respect to the shareholders holding aggregately 5% or more of the common and preferred stocks of the Company that have been registered and delivered in dematerialized form on the last business day at the end of the current quarter. The share capital stated in the parent company only financial statements of the Company may be different from the number of shares that have been actually registered and delivered in dematerialized form due to different bases of compilation and calculation.

IFRS Notes -68-SCIENTECH CORPORATION

§ Schedule of Major Accounts §

Item Schedule of Assets, Liabilities, and Equity Items Schedule of Cash Schedule of Notes Receivables and Accounts Receivables Schedule of Inventories Schedule of Investments Accounted for Using Equity Method Schedule of Changes in Property, Plant, and Equipment Schedule of Notes Receivables and Accounts Receivables Schedule of Short-term Borrowings Schedule of Other Payables Schedule of Profit or Loss Items Schedule of Net Operating Income Schedule of Operating Costs Schedule of Operating Expenses Schedule of Financial Costs Summary Table by Function of Employee Benefits, Depreciation, and Amortization Incurred in the Year

No./Index. Table 1 Table 2 Table 3 Table 4 Note 11 Table 5 Table 6 Note 15 Table 7 Table 8 Table 9 Note 19 Table 10

IFRS Notes -69-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Cash and Cash Equivalents

December 31, 2022

Table 1

Unit: NT$ thousand unless otherwise specified

Item Cash Cash on hand and working capital Bank check and demand deposit(Note 1) Cash Equivalents Bank time deposit whose initial maturity date will be due within 3 months (Note 2)	MaturityDate 112.1.26-112.3.21	Annual Interest Rate 4.0%-4.8%		Amount
				$ 505 1,762,003 1,762,508 430,094 $ 2,192,602

Note 1:Including JPY100,577 thousand, USD30,370 thousand, and EUR10,995 thousand, ＝ ＝ which were converted at the exchange rates of JPY$1 $0.232, US$1 $30.71, and ＝ EUR$1 $32.72, respectively.

Note 2: Including USD14,005 thousand, which were converted at the exchange rates of ＝ US$1 $30.71.

IFRS Notes -70-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Notes Receivables and Accounts Receivables

December 31, 2022

December 31, 2022
Table 2 Customer name Notes receivable (Note) Accounts receivable Company A Company C Company D Company E Others (Note) Receivables due from related parties Less: Allowance for doubtful accounts	Unit: NT$ thousand Amount $ 1,904 142,654 43,406 42,752 39,102 406,024 673,938 5,529 27,522 $ 653,849

Note: The balance of each individual customer did not exceed 5% of this account.

IFRS Notes -71-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Inventories

December 31, 2022

Table 3

Unit: NT$ thousand

Item Products Finished-goods Work-in-process Raw materials Less: Allowance for devaluation loss (Note)		Amount	Amount
		Cost $ 2,724,793 197,052 398,073 667,648 3,987,566 276,710 $ 3,710,856	Net	realizablevalue
				$ 3,352,013 262,060 478,349 1,002,213 $ 5,094,635

Note: The allowance for devaluation loss cover the allowance for products in the amount of NT$89,072 thousand, for finished-goods in the amount of NT$34,655 thousand, for work-in-process in the amount of NT$92,426 thousand, and for raw materials in the amount of NT$60,557 thousand.

IFRS Notes -72-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Investments Accounted for Using Equity Method

2022

Table 4

Unit: NT$ thousand; unless, otherwise stated

Investee Investment in subsidiary SCIENTECH INVESTMENT CORP. TRANSCEND CAPITAL CORP. SCIENTECH GMBH ACROMASS TECHNOLOGIES, INC. SCIENTECH MATERIALS CORPORATION NATGEM INC. Investment in associates FORWARD SCIENCE CORPORATION RENORIGIN INNOVATION INSTITUTE CO., LTD. FORWARD SCIENCE PTE. LTD. Investments accounted for using equity method	Balance - beginningofperiod Shares Amount Dispose of investment 5,540,000 $ 418,051 $ - 14,275,006 414,481 - - ( 9 ) - 27,000,000 5,069 - 1,400,000 3,166 $ - 800,000 793 - 841,551 - 2,000,000 32,004 ( 584 ) 1,121,000 9,970 - 500,000 - - 41,974 ( 584) $ 883,525 ($ 584)	Share of profit or loss of associates and subsidiaries accounted for using equity method $ 86,774 ( 55,528 ) 9,840 ( 1,792 ) 1 ( 210) 39,085 ( 2,813 ) ( 1,761 ) - ( 4,574) $ 34,511	Capital surplus $ - 103,324 - - - - 103,324 - - - - $ 103,324	Exchange differences arising from the translation of financial statements $ 32,039 1,647 428 - - - 34,114 ( 46 ) - - ( 46) $ 34,068	Others $ - ( 5,965 ) - - - - ( 5,965) - - - - ($ 5,965)	Balance - end ofyear Shares Shareholding % Amount 5,540,000 100 $ 536,864 14,275,006 100 457,959 - 100 10,259 27,000,000 100 3,277 1,400,000 100 3,167 800,000 100 583 1,012,109 1,960,000 6 28,561 1,121,000 22 8,209 500,000 21 - 36,770 $ 1,048,879	Balance - end ofyear Shares Shareholding % Amount 5,540,000 100 $ 536,864 14,275,006 100 457,959 - 100 10,259 27,000,000 100 3,277 1,400,000 100 3,167 800,000 100 583 1,012,109 1,960,000 6 28,561 1,121,000 22 8,209 500,000 21 - 36,770 $ 1,048,879	Balance - end ofyear Shares Shareholding % Amount 5,540,000 100 $ 536,864 14,275,006 100 457,959 - 100 10,259 27,000,000 100 3,277 1,400,000 100 3,167 800,000 100 583 1,012,109 1,960,000 6 28,561 1,121,000 22 8,209 500,000 21 - 36,770 $ 1,048,879	Remarks
	Shares 5,540,000 14,275,006 - 27,000,000 1,400,000 800,000 2,000,000 1,121,000 500,000					Shares 5,540,000 14,275,006 - 27,000,000 1,400,000 800,000 1,960,000 1,121,000 500,000	Shareholding % 100 100 100 100 100 100 6 22 21
									(Note 2) (Note 1) (Note 1) (Note 1) (Note 1)

Note 1: It was calculated based on financial statements in the same period that were not audited by CPAs. Note 2: The increase in capital surplus was the adjustment for the effects arising from failure to subscribe to an associate’s follow-on offering; others were the unrealized gains from downstream transactions in the year.

IFRS Notes -73-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Notes Receivables and Accounts Receivables December 31, 2022

December 31, 2022
Table 5 Name of manufacturer Accounts payable Company A Company B Others (Note) Payables due to related parties (Note) Total	Unit: NT$ thousand Amount $ 1,001,496 173,679 605,030 1,780,205 4,034 $ 1,784,239

Note: The balance of each individual customer did not exceed 5% of this account.

IFRS Notes -74-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Short-term Borrowings

December 31, 2022

Table 6

Unit: NT$ thousand

Name Bank loans against a letter of credit Bank SinoPac CTBC Bank Bank credit loans DBS Bank Limited	Borrowing period 2022.06.02-2024.06.30 2022.08.22-2023.08.31 2022.10.03-2023.10.02		Balance $ 216,383 8,596 $ 224,979 $ 200,000	Credit limit of financing facilities $ 300,000 680,000 $ 980,000 $ 300,000	Pledged or collateralized None None None	Remarks
						Note 2

Note 1: The interest rate range is between 0.50 and 1.40%.

• Note 2: The credit limit of CTBC Bank credit loans and CTBC Bank loans against a letter of credit is accumulative, and amounted to NT$680,000 thousand.

IFRS Notes -75-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Net Operating Income

2022

Table 7 Name Manufacturing Sale in the capacity of an agent Commission Maintenance Others	Quantity 2,243,526 33,011	Unit: NT$ thousand Amount $ 2,014,840 1,932,929 91,094 34,256 57,452 $ 4,130,571

IFRS Notes -76-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Operating Costs

2022

Table 8

Unit: NT$ thousand

Name Cost to manufacture and cost of goods sold Raw materials - beginning balance Plus: material purchase Work-in-process transferred in Finished-goods transferred in Others Less: raw materials - ending balance Transferred to products Pick-up for R&D use Direct raw material consumption Direct labor Manufacturing overheads Manufacturing expenses Add: work-in-process - beginning balance Less: work-in-process - ending balance Transferred to raw materials Cost of finished-goods Add: finished-goods - beginning balance Others Less: finished-goods - ending balance Transferred to raw materials Others Cost of goods sold Products - beginning balance Add: products purchased in the year Raw materials transferred to products Less: products - ending balance Others Add: Allowance for inventory devaluation loss Add: Retirement of inventories Add: Inventory shortage		Amount
		$ 273,023 1,182,527 676,750 389,260 57,508 667,648 35,975 146,461 1,728,984 175,343 389,493 2,293,820 342,187 398,073 676,750 1,561,184 134,997 4,699 197,052 389,260 30,153 1,084,415 1,256,545 2,918,934 35,975 2,724,793 60,404 1,426,257 48,223 3,467 129 $ 2,562,491

IFRS Notes -77-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Schedule of Operating Expenses

January 1 through December 31, 2022

Table 9

Unit: NT$ thousand

Item Salary expenses Commission Depreciation Freight charges Material cost Insurance premium Service expenses Travel expenses Others (Note)		Marketing expenses General and administrative expenses $ 220,562 $ 92,928 77,552 - 19,318 6,151 62,882 442 22,955 - 19,217 6,566 12,312 5,353 11,365 171 90,341 31,680 $ 536,504 $ 143,291	R&D expenses Gains on expected credit impairment $ 142,288 $ - - - 49,498 - 163 - 23,952 - 11,264 - 7,112 - 2,302 - 47,279 5,503 $ 283,858 $ 5,503		Total
					$ 455,778 77,552 74,967 63,487 46,907 37,047 24,777 13,838 174,803 $ 969,156

Note: No amount individually exceeds 5% of this account.

IFRS Notes -78-SCIENTECH CORPORATION

SCIENTECH CORPORATION

Summary Table by Function of Employee Benefits, Depreciation, and Amortization Incurred in the Year

2022 and 2021

		2022	and	2021
Table 10 Employee benefit expenses Salary expenses Labor insurance and health insurance expenses Pension expenses Directors’ remuneration Other employee benefit expenses Depreciation Amortization expenses		2022		Total $ 634,344 51,221 25,462 9,090 29,513 $ 749,630 $ 105,767 $ 324		2021	Unit: NT$ thousand Total $ 530,493 45,020 13,104 7,048 27,938 $ 623,603 $ 101,131 $ 260
	Attributable to operatingcosts $ 187,656 18,936 5,878 - 15,389 $ 227,859 $ 30,800 $ -	Attributable to operatingexpenses $ 446,688 32,285 19,584 9,090 14,124 $ 521,771 $ 74,967 $ 324			Attributable to operatingcosts $ 163,688 16,710 5,500 - 13,420 $ 199,318 $ 29,651 $ -	Attributable to operatingexpenses $ 366,805 28,310 7,604 7,048 14,518 $ 424,285 $ 71,480 $ 260

Note 1: The number of the Company’s employees in 2022 and 2021 is 634 and 583, respectively, of whom the number of directors not concurrently serving as an employee is both 6. Note 2: (1) The average employee benefit expenses in 2022 and 2021 were NT$1,179 thousand and NT$1,069 thousand, respectively.

• (2) The average employee salary expenses in 2022 and 2021 were NT$1,010 thousand and NT$919 thousand, respectively.

• (3) The extent of average employee salary adjustment was 9.9%.

Note 3: There were no supervisor remuneration because the Company did not have supervisors in 2022 and 2021.

• Note 4: The Company’s independent directors are entitled to a fixed amount of remuneration. Other directors are entitled to no compensation other than the reimbursement of transportation expenses required for attending a Board meeting. In addition, according to Article 20 of the Company’s Articles of Incorporation, no less than 2% of the annual earnings may be allocated as directors’ remuneration. Such remuneration is firstly proposed to the Remuneration Committee in accordance with the Company’s remuneration distribution principles; if the committee gives the approval, such remuneration proposal is then summited to the Board of Directors and, if approved, implemented.

• Note 5: The salary structure of the Company’s employees and managers mainly comprises base salary, job pay differentials, bonus, and monetary perks. The salary adjustment, year-end bonus, and bonus distribution therefor are determined based on the “Employee Promotion Regulations” and “Employee Bonus Distribution Principles”, and are firstly proposed by the management executives with consideration given to personal performance and the Company’s operational performance, then approved by the executives with the authority, then submitted to the Remuneration Committee for consideration, and, if approved, implemented.

IFRS Notes -79-SCIENTECH CORPORATION