SINPHAR — Audit Report / Information 2023

Nov 14, 2023

Stock Code ： 1734

Sinphar Pharmaceutical Co., Ltd.

Parent Company Only Financial Statements for the Years Ended December 31, 2023 and 2022 and Independent Auditors’ Report

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INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders of

Sinphar Pharmaceutical Co., Ltd.

Opinion

We have audited the accompanying parent company only financial statements of Sinphar Pharmaceutical Co., Ltd. (the “Company”), which comprise the parent company only balance sheet as of December 31, 2023 and 2022 and the parent company only statements of comprehensive income, changes in equity and cash flows for the years ended December 31, 2023 and 2022, and the notes to the parent company only financial statements, including a summary of significant accounting policies.

In our opinion, the accompany parent company only financial statements present fairly, in all material respects, the financial position of the Company as of December 31,2023 and 2022, and its financial performance and its cash flows for the years ended December 31, 2023 and 2022, in accordance with the Regulation Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulation Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Parent Company Only Financial Statements section of our report. We are independent of the Company in accordance with The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the parent company only financial statements for the year ended December 31, 2023. These matters were addressed in the context of our audit of the parent company only financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matters for the Company’s parent company only financial statements for the year ended December 31, 2023 are stated as follows:

Inventory Valuation

Please refer to Note 4(7.) and 5(2.) in the accompanying parent company only financial statements for related disclosures of the Company’s valuation of inventory accounting policies and critical accounting estimate and assumption.

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The Company mainly engages in the production and sales of various types of drugs and food supplements. As the regulations to the pharmaceutical industry cause the cost to increase and meanwhile selling prices are less likely to be affected as they are covered by the health insurance system. Furthermore, the price of food supplement inventory fluctuates due to market competition and the impacts aroused from advertisements. Management assesses that the net realizable value of inventory involves material judgment. Hence, it is taken as a one of the key audit matters.

Our key audit procedures in response

Our procedures in relation to inventory valuation included:

1. Understand and evaluate the design and implementation of the internal control in relation to inventory.

2. Perform inventory counts, to identify if there are any inventories which are obsolete or damaged.

3. Obtain Inventory aging reports to analyses the changes in inventory age, and check the records of inventory changes to verify the correctness of inventory.

4. Evaluate the reasonableness of its inventory valuation policy of unmarketable items and obsolescence, and check the latest inventory sales price to evaluate the reasonableness of the net realizable value of the inventory.

5. Obtain evaluation documents for subsequent measurement of inventories and assess whether they have been measured in accordance with established accounting policies and review if the management’s disclosure on the evaluation of inventory is presented fairly.

Revenue Recognition

Please refer to Note 4(16.) and 5(2.) in the accompanying parent company only financial statements for related disclosures of the Company’s revenue recognition accounting policies and critical accounting estimate and assumption.

Some products of the Company provide discounts or sales incentives based on the terms of the sales contract. Since the recognition of the revenue is measured on the net basis of the related discounts and incentives, we consider the revenue recognition as a key audit matter.

Our key audit procedures in response

Our procedures in relation to the revenue recognition included:

1. Evaluate the design and implementation of the internal control in relation to the revenue recognition.

2. Perform sales contract checks to verify whether the records on the recognition of sales revenue agree with the related contract, and evaluate the fairness of the management’s estimated sales discounts and sales incentives.

3. Assess whether the management’s accounting treatments and disclosure in relation to sales discounts and sales incentives are presented fairly.

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 Regulation Governing the Preparation of Financial Reports by Securities Issuers, and for such internal control as management determines is necessary to enable the preparation of parent company only financial statements that are free from material misstatement, whether due to fraud or error.

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In preparing the parent company only financial statements, management is responsible for assessing the Company’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 Company or to cease operation, or has no realistic alternative but to do so.

Those charged with governance (including members of the Audit Committee) are responsible for overseeing the Company’s financial reporting process.

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

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

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

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, misrepresentation, 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 Company’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 Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the parent company only financial statements or, if such disclosure are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company 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 the parent company only financial statements represent the underlying transactions and events in a manner that achieve fair presentation.

6. Obtain sufficient appropriate audit evidence regarding the financial information of the investee accounted for using equity method within the Company to express an opinion on the parent company only financial statements. We are responsible for direction, supervision and performance of the investee audit. We remain solely responsible for our audit opinion.

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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 for the year ended December 31, 2023 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Ya Quan Zhang and Jin Shu Pan.

Crowe (TW) CPAs Taipei, Taiwan The Republic of China

March 6, 2024

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

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Sinphar Pharmaceutical Co., Ltd.

PARENT COMPANY ONLY BALANCE SHEETS For the years ended December 31, 2023 and 2022

(In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS	Note	% Amount December 31,2023	% Amount December 31,2023	Amount % December 31,2022	Amount % December 31,2022
		Amount		Amount
Cash and cash equivalents Notes receivable, net Accounts receivable, net Inventories Prepayments Other current assets Total current assets	6 (1) 6 (2) 6 (3)、6(17) and 7 (3) 6 (4) 7 (3) 6 (5) 6 (5) 6 (6) 6 (7), 7 (3) and 8 6 (8) and 8 6 (9) and 8 6 (22)	$ 700,998 163,900 426,002 705,774 35,781 4,773 2,037,228	12 3 7 12 1 - 35	$ 703,055 178,825 456,586 615,056 36,598 4,105 1,994,225	13 3 8 11 1 - 36
NONCURRENT ASSETS
Financial assets at fair value through profit and loss, non-current Financial assets at fair value through other comprehensive income, non-current		2,394 10,136 1,136,111 2,279,559 111,388 20,711 170,856 19,954 24,736 30,762 3,806,607 $ 5,843,835	- - 20 39 2 - 3 - - 1 65 100	1,219 9,608 1,161,753 2,020,278 237,961 28,466 52,108 57,626 17,830 19,147 3,605,996 $ 5,600,221	- - 21 36 4 1 1 1 - - 64 100
Investments accounted for using equity method Property, plant and equipment Investment property, net Intangible assets Deferred tax assets Prepayments for equipment Refundable deposits Other non-current assets Total non-current assets TOTAL
LIABILITIES AND EQUITY CURRENT LIABILITIES
Short-term loans Contract liabilities-current	6 (10) 6 (17)	$ 360,000 84,352 302,196 290,614 - 48,490 37,254 1,122,906 1,486,473 35,552 100,566 1,622,591 2,745,497 1,677,221 924,140 142,979 121,367 369,802 634,148 (137,171) 3,098,338 $ 5,843,835	6 1 5 5 - 1 1 19	$ 360,000 93,235 313,721 281,867 39,774 48,116 42,614 1,179,327	6 2 5 5 1 1 1 21
Accounts payable	7 (3)
Other payable Current tax liabilities Long-term loans - current portion Other current liabilities, others Total current liabilities	7 (3) 6 (11) and 8 6 (11) and 8 6 (12) 6 (22) and 7(3) 6 (13) 6 (14) 6 (15) 6 (15) 6 (15) 6 (16)
NONCURRENT LIABILITIES
Long-term loans Net defined benefit liability, non-current Other non-current liabilities, others			25 1 2 28 47 29 16 2 2 6 10 (2) 53 100	1,404,819 35,978 49,867 1,490,664 2,669,991 1,677,221 929,972 119,606 91,075 233,724 444,405 (121,368) 2,930,230 $ 5,600,221	25 1 1 27 48 30 16 2 2 4 8 (2) 52 100
Total non-current liabilities
Total liabilities EQUITY Capital stock Capital surplus Retained earnings Legal capital reserve Special capital reserve Unappropriated retained earnings
Total retained earnings
Other Equity Total equity TOTAL LIABILITIES AND EQUITY

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

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Sinphar Pharmaceutical Co., Ltd.

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME

For the years ended December 31, 2023 and 2022

(In Thousands of New Taiwan Dollars)

		2023		2022
ITEM	Note	Amount $ 2,717,210 (1,684,194) 1,033,016 (568) 371 1,032,819 (433,725) (136,083) (122,146) (1,699) (693,653) 339,166 7,516 36,774 (4,892) (32,114) (35,189) (27,905) 311,261 63,909 375,170 (3,736) (1,922) (1,862) (7,520) (15,045) 17 3,009 (12,019) (19,539) $ 355,631	%	Amount	%
NET REVENUE COST OF REVENUE GROSS PROFIT Less: Unrealized profit on sales Add: Realized profit on sales GROSS PROFIT OPERATING EXPENSES Selling expenses Administrative expenses Research and development expenses Expected credit impairment loss Total operating expenses NET OPERATIONS INCOME NON-OPERATING INCOME AND EXPENSES Interest income Other income Other gains and losses Finance costs Share of the loss of subsidiaries and associated and joint ventures accounted for using equity method Total non-operating income and expenses INCOME BEFORE INCOME TAX INCOME TAX (EXPENSE) BENEFIT PROFIT OTHER COMPREHENSIVE INCOME (LOSS)	6 (17) and 7 (3) 6 (4), 6(20) and 7 (3) 6 (20) and 7 (3) 6 (3) 6 (18) and 7 (3) 6 (19) and 7 (3) 6 (21) 6 (6) 6 (22) 6 (23) 6 (24)		100 (62) 38 - - 38 (16) (5) (4) - (25) 13 - 1 - (1) (1) (1) 12 2 14 - - - - (1) - - (1) (1) 13	$ 2,511,206 (1,577,211) 933,995 (371) 1,106 934,730 (390,581) (121,669) (111,002) (1,869) (625,121) 309,609 1,744 40,226 11,707 (25,007) (51,887) (23,217) 286,392 (61,748) 224,644 9,080 (68) (3,274) 5,738 13,919 18 (2,784) 11,153 16,891 $ 241,535	100 (63) 37 - - 37 (16) (5) (4) - (25) 12 - 2 - (1) (2) (1) 11 (2) 9 - - - - 1 - - 1 1 10
Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit obligation Unrealized loss from investments in equity instruments measured at fair value through other comprehensive income Share of other comprehensive loss of subsidiaries, associates and joint ventures accounted for using equity method Items that may be reclassified subsequently to profit or loss:
Exchange differences arising on translation of foreign operations Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method
Income tax related to components of other comprehensive income that will be reclassified to profit or loss
Other comprehensive income (loss) for the year, net of income tax
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
EARNINGS PER SHARE		$ 2.24
Basic earnings per share				$ 1.34
Diluted earnings per share		$ 2.23		$ 1.34

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

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Sinphar Pharmaceutical Co., Ltd.

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY

For the years ended December 31, 2023 and 2022

(In Thousands of New Taiwan Dollars)

For the years ended December 31, 2023 and 2022 (In Thousands of New Taiwan Dollars)
	Capital Stock						Retained Earning			Other		$ (37,325) - - - (3,342) (3,342) (40,667) - - - - - - (3,784) (3,784) $ (44,451) EquityInterests Unrealized Gain(Loss) on Financial Assets at Fair Value Through Other Comprehensive Income		$ 2,722,239 - (33,544) 224,644 16,891 241,535 2,930,230 - - (167,722) (167,722) (19,801) 375,170 (19,539) 355,631 Total Equity
ITEM	Common Stock		Capital Surplus		Legal Capital Reserve		Special Capital Reserve		Unappropriated Retained Earnings (Accumulated Deficit)	$ (91,854) - - - 11,153 11,153 (80,701) - - - - - - (12,019) (12,019) $ (92,720) Foreign Currency Translation Reserve
Balance, January 1, 2022	$ 1,677,221 - - - - - 1,677,221 - - - - - - - - $ 1,677,221	$	963,516 - (33,544) - - - 929,972 - - - - (5,832) - - - 924,140	$	153,734 (34,128) - - - - 119,606 23,373 - - 23,373 - - - - 142,979	$	91,075 - - - - - 91,075 - 30,292 - 30,292 - - - - 121,367	$	(34,128) 34,128 - 224,644 9,080 233,724 233,724 (23,373) (30,292) (167,722) (221,387) (13,969) 375,170 (3,736) 371,434 369,802	$		$
Appropriations of earnings
Legal reserve used to offset accumulated deficits
Other changes in capital surplus Stock dividends from capital surplus
Net profit in 2022 Other comprehensive income (loss) in 2022, net of income tax Total comprehensive income (loss) in 2022 Balance, December 31, 2022 Appropriations of earnings Legal reserve appropriated
Special reserve appropriated Cash dividends of ordinary share Total appropriations of earnings Other changes in capital surplus Changes in ownership interests in subsidiaries Net profit in 2023 Other comprehensive loss in 2023, net of income tax Total comprehensive income (loss) in 2023
Balance, December 31, 2023		$		$		$		$		$		$		$ 3,098,338

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

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Sinphar Pharmaceutical Co., Ltd. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS For the years ended December 31, 2023 and 2022

(In Thousands of New Taiwan Dollars)

For the years ended December 31, 2023 and 2022 Sinphar Pharmaceutical Co., Ltd. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars)
ITEM CASH FLOWS FROM OPERATING ACTIVITIES	2023	2022
Income before income tax Adjustments for: Depreciation expense (including investment property) Amortization expense Expected credit impairment loss Interest expense Interest income	$ 311,261 145,015 29,193 1,699 32,114 (7,516) 35,189 (5,145) 568 (371) 14,771 29,039 (90,718) 817 27 (8,883) (11,525) 12,250 (5,360) (4,162) (19) 478,244 7,516 (32,026) (41,246) 412,488 (119,237) (2,450) (176,243) 5,842 (6,906) (5,230) (27,766) (68,153) 71,824 (328,319) - 160,000 (77,972) - (532) (167,722) (86,226) (2,057) 703,055 $ 700,998	$ 286,392 139,137 41,207 1,869 25,007 (1,744) 51,887 402 371 (1,106) (19,675) (93,154) (55,333) (9,889) (1,958) 928 120,199 36,888 10,678 (5,831) (1,474) 524,801 1,744 (24,802) (35,422) 466,321 - (9,676) (69,670) 87 7,462 (11,061) (12,219) (51,369) 44,405 (102,041) (80,000) 150,000 (226,888) (1,895) (28) (33,544) (192,355) 171,925 531,130 $ 703,055
Share of loss of subsidiaries and associates and joint ventures accounted for using equity method, net Loss (gain) on disposal of property, plant and equipment
Unrealized profit on sales Realized profit on sales Changes in operating assets and liabilities: Notes receivable, net Accounts receivable, net Inventories Prepayments Other current assets Contract liabilities Accounts payable Other payable Other current liabilities Net defined benefit liability Other operating liabilities Cash generated from operations
Interest received
Interest paid Income taxes paid
Net cash generated from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of investments accounted for using equity method
Acquisition of financial assets at fair value through other comprehensive income Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment
Decrease (increase) in refundable deposits Acquisition of intangible assets
Increase in other non-current assets
Increase in prepayments for equipment Dividends received
Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Decrease in short-term loan Proceeds from long-term debt Repayments of long-term debt Decrease in long-term payables Decrease in refundable deposits Cash dividends paid Net cash used in financing activities NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD CASH AND CASH EQUIVALENTS AT END OF THE PERIOD

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

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Sinphar Pharmaceutical Co., Ltd.

NOTES TO PARENT COMPANY ONLY FINANCIAL STATEMENTS

FOR THE YEAR ENDED DECEMBER 31, 2023 and 2022

(Amounts in Thousands of New Taiwan Dollars , Unless Specified Otherwise)

1. GENERAL INFORMATION

Sinphar Pharmaceutical Co., Ltd. (the Company or Sinphar) was incorporated in the Republic of China (“R.O.C.”) on July 2, 1977. Sinphar mainly engages in the production, processing and trading of various Western medicines, Chinese medicines, medicinal cosmetics and detergents.

Sinphar’s shares have been listed on the Taipei Exchange since October 17, 2000. On August 26, 2002, Sinphar’s stocks were approved for listing on the Taiwan Stock Exchange. The address of its registered office and principal place of business is No.84, Zhongshan Rd., Dongshan Township, Yilan County, Taiwan.

The parent company only financial statements are presented in the Company’s functional currency, New Taiwan dollars.

2. APPROVAL OF FINANCIAL STATEMENTS

The accompanying parent company only financial statements were approved by the Company’s board of directors and issued on March 6, 2024.

1. APPLICATION OF NEW AND REVISED STANDARDS, AMENDMENTS AND INTERPRETATIONS

2. (1) Initial application of the amendments to the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), Interpretations of IFRS (IFRIC), and Interpretations of IAS (SIC) (collectively, “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC).

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

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

“ － Amendments to IAS 12 International Tax Reform Pillar (Note 4) Two Model Rules ”

• Note 1: An entity shall apply these amendments for annual reporting periods beginning on or after January 1, 2023.

• Note 2: These amendments apply to changes in accounting estimates and changes in accounting policies that occur during annual reporting periods beginning on or after January 1, 2023.

• Note 3: An entity shall apply the amendments to transactions that occur on or after the beginning of the earliest comparative period presented. It also, at the beginning of the earliest comparative period presented, recognizes deferred taxes for all temporary differences related to leases and decommissioning obligations and recognizes the cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings (or other component of equity, as appropriate) at that date.

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• Note 4: As a temporary exception under IAS 12, an entity shall not recognize deferred income tax assets and liabilities assoicated with Pillar 2 income tax, nor shall it disclose the related information. However, the entity shall disclose in its financial report that it has already applied this exception. An entity shall apply this part of the amendment retrospectively in accordance with IAS 8 since the date that the amendments were issued (i.e. May 23, 2023). An entity shall apply the remaining disclosure requirements for the annual reporting periods beginning on or after January 1, 2023 and needs not to disclose such information in its interim reports with a reporting date ending before or on December 31, 2023.

• A.Amendments to IAS 1 “Disclosures of Accounting Policies”

The amendments clarify that an entity shall disclose its material significant accounting policy information if the transaction, other event or condition to which the accounting policy information relates is material in size or nature, or a combination of both, and the accounting policy information that relates to a material transaction, other event or condition is also material to the financial statements. On the other hand, if the transaction, other event or condition to which the accounting policy information relates is immaterial in size or nature, an entity needs not to disclosure the accounting policy information that relates to the immaterial transaction, other event or condition. Additionally, Immaterial accounting policy information that relates to material transactions, other events or conditions need not be disclosed, either. However, an entity’s conclusion that accounting policy information is immaterial does not affect the related disclosure requirements set out in other IFRS Standards.

• B.Amendments to IAS 8 “Definition of Accounting Estimates”

The amendments define accounting estimates as monetary amounts in financial statements that are subject to measurement uncertainty and clarify that a change in measurement techniques or inputs used to develop an accounting estimate is a change in accounting estimates unless the change is due to an error from prior periods.

• C.Amendments to IAS 12 “Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction”

The amendments narrow the exemption extent in paragraphs 15 and 24 of IAS 12 for an entity from recognizing a deferred tax asset or liability in particular circumstances. In particular, the exemption does not apply to a transaction that gives rise to equal taxable and deductible difference at the time of the transaction. At the initial application of the amendments, an entity shall, at the beginning of the earliest comparative period presented, recognise deferred taxes for all deductible and taxable temporary differences associated with (i) lease and (ii) decommissioning liabilities and recognise the cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings (or other component of equity, as appropriate) at that date. An entity shall also apply the amendments transactions that occur on or after the beginning of the earliest comparative period presented. When initially applying the amendments, the information for comparable periods shall be restated.

• “ － ”

• D.Amendments to IAS 12 International Tax Reform Pillar Two Model Rules

The amendments stipulates that, as a temporary exception to IAS 12, Group shall neither recognize nor disclose information about deferred income tax assets and liabilities for Pillar Two income tax relating to international tax reform; however, Group shall disclose in its financial reports that it has applied this exception. In addition, Group shall separately disclose its current income tax expenses (benefits) relating to Pillar Two income tax. If the Pillar Two bill has been enacted or has been substantively enacted but has not yet taken effect, Group should disclose qualitative and quantitative information on its exposure to Pillar Two income tax that is known or can be reasonably estimated.

Based on the Company’s assessment, the New IFRSs above have no significant effect on the Company’s financial position and financial performance.

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• (2) The IFRSs issued by International Accounting Standards Board (IASB) and endorsed by FSC with effective date starting 2024

New standards, interpretations and amendments endorsed by the FSC and effective from 2024 are as follows:

New standards, interpretations and amendments endorsed by the	FSC and effective from 2024 are as follows:
New Standards,Interpretations and Amendments Amendments to IFRS 16 “Lease Liability in a Sale and Leaseback” Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” Amendments to IAS 1 “Non-current Liabilities with Covenants” Amendments to IAS 7 and IFRS 7 “Supplier finance arrangements”	Effective Date Announced byIASB
	January 1, 2024 (Note 1) January 1, 2024 January 1, 2024 January 1, 2024 (Note 2)

• Note 1: The seller-lessee shall apply the amendments retrospectively in accordance with IAS 8 for the sale and leaseback transactions made after the initial application of IFRS 16.

• Note 2: The amendment provides certain transitional reliefs. When initially appling the amendment, entities are not required to disclose comparative information and interim period information, as well as opening information required by paragraph 44H(b)(ii)-(iii).

• A.Amendments to IFRS 16 “Lease liability in a sale and leaseback”

The amendment clarifies that for a sale and leaseback transaction, if the transfer of the asset is treated as a sale in accordance with IFRS 15, the liabilities incurred by the seller-lessee due to the leaseback should be treated in accordance with the IFRS 16. Moreover, if any variable lease payments that do not depend on an index or rate are involved, the seller-lessee should still determine and recognize the lease liability arising from such variable payments in a manner that does not recognize gains and losses related to the retained right of use. The difference between the subsequent actual lease payment amount and the reduced carrying amount of the lease liability is recognized in profit or loss.

B.Amendments to IAS 1 “Classification of Liabilities as Current or Non-current”

The amendments clarify that when an entity determines whether a liability is classified as non-current, the entity should assess whether it has the right to defer the settlement for at least twelve months after the reporting period. If the entity has that right on the end of reporting period, that liability must be classified as non-current regardless whether the entity expects whether to exercise the right or not. If the entity must follow certain conditions to have the right to defer the settlement of a liability, the entity must have followed those conditions at the end of reporting period in order to have that right, even if the lender tests the entity’s compliance on a later date.

The aforementioned settlement means transferring cash, other economic resources or the entity’s equity instruments to the counter-party to extinguish the liability. If the terms of the liability give the counter-party an option to extinguish the liability by the entity’s equity instruments, and this option is recognized separately in equity in accordance with IAS 32 “Financial Instruments: Presentation”, then the classification of the liability will not be affected.

• C.Amendment to IAS 1 “Non-current Liabilities with Covenants”

This amendment further clarifies that only contractual terms that are required to be complied with before the end of the reporting period will affect the classification of the liability at that date. The contractual terms that required to be complied with within 12 months after the reporting period do not affect the classification of liabilities at the reporting date. However, for liabilities classified as non-current and must be repaid within 12 months after the reporting period due to potential non-compliance, the relevant facts and circumstances should be disclosed.

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D.Amendments to IAS 7 and IFRS 7 “Supplier finance arrangements”

Supplier financing arrangements involve one or more financing providers making payments to suppliers on behalf of an entity, and the entity agrees to repay the financing providers on the payment date agreed with the suppliers or a later date. The amendments to IAS 7 require an entity to disclose information on its supplier financing arrangements to enable users of financial statements to assess the impact of these arrangements on the entity's liabilities, cash flows and exposure to liquidity. The amendments to IFRS 7 include into its application guidance that when disclosing how an entity manages the liquidity risk of its financial liabilities, it may also consider whether it has obtained or can obtain financing facilities through supplier financing arrangements, and whether these arrangements may cause concentration of liquidity risk.

Based on the Company’s assessment, the application of the New IFRSs above will not have any significant impact on the Company’s financial position and financial performance.

• (3) The IFRSs issued by International Accounting Standards Board (“IASB”) but not yet endorsed and issued into effect by the FSC.

effect by the FSC.
New Standards,Interpretations and Amendments	Effective Date Announced byIASB
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” Amendments to IFRS 17 Amendments to IFRS 17 “Initial Application of IFRS 17 and IFRS 9－ Comparative Information” Amendments to IAS 21 “Lack of Exchangeability”	To be determined by IASB January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2025

As of the date, the accompanying parent company only financial statements were authorized for issue, the Company continues in evaluating the impact on its financial position and financial performance as a result of the initial adoption of the aforementioned standards or interpretations. The related impact will be disclosed when the Company completes the evaluation.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The main accounting policies used in the preparation of the parent company only financial statements are explained below. Unless otherwise stated, these policies apply consistently throughout all reporting periods.

• (1.) Statement of Compliance

The accompanying parent company only financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRSs endorsed by the FSC.

• (2.) Basis of Preparation of the Parent Company Only Financial Statement

• A. Except for the following items, the accompanying parent company only financial statements have been prepared on the historical cost basis:

  • (A.) The financial assets and liabilities measured at fair value through profit and loss (including derivative financial instruments).

  • (B.) The financial assets measured at fair value through other comprehensive income.

  • (C.) Defined benefit liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligation.

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• B. The preparation of the parent company only financial statements in compliance with IFRSs endorsed by FSC requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in process of applying the Company’s accounting policies. The areas involving a high degree of judgment or complexity, or areas where assumptions and estimates are significant to the parent company only financial statements are disclosed in Note 5.

• C. The subsidiaries, associates and jointly controlled entities are incorporated in the parent company only financial statements under the equity method.

• (3.) Foreign Currencies

• A. Foreign currency transaction

Transactions in currencies other than the Company’s functional currency are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Exchange differences on monetary items arising from settlement or translation are recognized in profit or loss in the period. Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured at historical cost in a foreign currency are not retranslated. Except for financial instruments at FVTOCI, financial instruments that are designated as foreign operation net hedge or qualified as cash flow hedge, the retranslation foreign exchange differences are recognized in other comprehensive income. In other cases, the exchange differences are recognized in profit and loss.

• B. Translation of foreign operation

For the purpose of preparing parent company only financial statements, the functional currencies of the Company and the foreign entities (including subsidiaries, associates, joint ventures and branches in other countries that use currency different from the currency of the Company) are translated into the presentation currency - the New Taiwan dollar as follows: assets and liabilities are translated at the exchange rates prevailing at the end of the reporting period; profits and losses items are translated at the average exchange rates for the period. The resulting currency translation differences are recognized in other comprehensive income.

On the disposal of a foreign operation involving the loss of control, joint venture or significant influence over the foreign operation, all of the exchange differences accumulated in equity in respect of that operation are reclassified to profit or loss.

In relation to a partial disposal of a subsidiary that does not result in the Company losing control over the subsidiary, the proportionate share of accumulated exchange differences is re-attributed to the non-controlling interests of the subsidiary and is not recognized in profit or loss. For all other partial disposals, the proportionate share of the accumulated exchange differences recognized in other comprehensive income is reclassified to profit or loss.

(4.) Classification of Current and Noncurrent Assets and Liabilities

• A. Assets that meet one of the following criteria are classified as current assets:

• (A.) Assets expected to be realized or intended to be sold or used within normal operating cycle;

• (B.) Assets held primarily for the purpose of trading;

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• (C.) Assets expected to be realized within 12 months after the reporting period; and

• (D.) Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.

Assets that are not classified as current are classified as non-current.

• B. Liabilities that meet one of the following criteria are classified as current liabilities:

• (A.) Liabilities expected to be paid off within normal operating cycle;

• (B.) Liabilities held primarily for the purpose of trading;

• (C.) Liabilities due to be settled within 12 months after the reporting period (It is still a current liability even if a long-term refinancing or rearrangement of payment agreement is completed after the balance sheet date and before the financial report is approved,); and

• (D.) Liabilities for which the Company does not have an unconditional right to defer settlement for at least 12 months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

Liabilities that are not classified as current are classified as non-current.

• (5.) Cash and Cash Equivalent

Cash and cash equivalent includes cash on hand, bank deposit and short-term, highly liquid investment that are readily convertible to know amount of cash and which are subject to an insignificant risk of change in value. Time deposits with original maturities within 1 year from the closing date that meet the definition above and are held for purpose of meeting short-term cash commitments in operations are classified as cash equivalent.

• (6.) Financial Instruments

Financial assets and financial liabilities are recognized in balance sheets when the Company becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at FVTPL) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at FVTPL are recognized immediately in profit or loss.

A. Financial assets

• (A.) Measurement category

The Company adopts trade-date accounting to recognize financial assets.

Financial assets are classified as financial assets at FVTPL, financial assets at amortized cost, and equity investments at FVTOCI.

a. Financial assets at FVTPL

Financial asset is classified as at FVTPL when the financial asset is mandatorily classified or designated as at FVTPL. Financial assets mandatorily classified as at FVTPL including equity investments not designated as at FVTOCI and debt instruments that do not meet the criteria of amortized cost or the FVTOCI.

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Financial assets at FVTPL are initially and subsequently measured at fair value, with any gains or losses arising from remeasurement recognized in other gains or losses income. Fair value is determined in the manner described in Note 12(3).

• b. Equity investment at FVTOCI

On initial recognition, the Company may make an irrevocable election to designate investments in equity instruments as at FVTOCI. Designation at FVTOCI is not permitted if the equity investment is held for trading or if it is contingent consideration recognized by an acquirer in a business combination.

Investments in equity instruments at FVTOCI are subsequently measured at fair value with gains and losses arising from changes in fair value recognized in other comprehensive income and accumulated in other equity. The cumulative gain or loss will not be reclassified to profit or loss on disposal of the equity investments, instead, they will be transferred to retained earnings.

Dividends on these investments in equity instruments are recognized in profit or loss when the Company’s right to receive the dividends is established, unless the dividends clearly represent a recovery of part of the cost of the investment.

• c. Financial assets at amortized cost

Financial assets that meet the following conditions are subsequently measured at amortized cost:

• (a.) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and

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

Subsequent to initial recognition, financial assets measured at amortized cost are measured at carrying amount determined by the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

Interest revenue is calculated by using the effective interest method. This is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for:

• (a.) Purchased or originated credit-impaired financial assets, for those financial assets, the Company applies the credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.

• (b.) Financial assets that are not purchased or originated credit-impaired financial assets but subsequently have become credit-impaired financial assets, for those financial assets, the Company applies the effective interest rate to the amortized cost of the financial asset in subsequent reporting periods.

• (B.) Impairment of financial assets

The Company recognizes a loss allowance for expected credit losses (“ECL”) on financial assets at amortized cost (including accounts receivable).

The loss allowance for accounts receivable is measured at an amount equal to lifetime ECL. For other financial assets, when the credit risk on the financial instrument has not increased significantly since initial recognition, a loss allowance is recognized at an amount equal to 12-month ECL. If there has been a significant increase in credit risk since initial recognition, a loss allowance is recognized at an amount equal to lifetime ECL.

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ECL reflects the weighted average of credit losses with the respective risks of a default occurring as the weights. Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument. In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result from default events on a financial instrument that are possible within 12 months after the reporting date.

The Company recognizes an impairment loss for aforementioned financial instruments with a corresponding adjustment to their carrying amount through a loss allowance account.

• (C.) Derecognition of financial assets

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

• a. The contractual rights to receive the cash flows from the financial asset expire.

• b. The contractual rights to receive cash flows of the financial asset have been transferred and the Company has transferred substantially all risks and rewards of ownership of the financial asset.

• c. The Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

The difference between the book value and the price of financial assets at amortized cost will be recognized to profit or loss on disposal of the financial assets. The cumulative gain or loss of the investments in equity instruments at FVTOCI will not be reclassified to profit or loss on disposal of the equity investments. Instead, they will be transferred to retained earnings.

• B. Financial liabilities

• (A.) Subsequent measurement

Except for the following, financial liabilities measured at amortized cost are measured using the effective interest rate method after initial recognition.

• a. Financial liabilities at FVTPL are financial liabilities held for trading or financial liabilities designated upon initial recognition as at FVTPL. Repurchase currently and the derivative financial instruments unless financial guarantee contract and designated and effective as a hedging instrument, are classified financial liabilities held for trading. The Company designates the financial liabilities upon initial recognition as at FVTPL when the financial liabilities accord to one of the followings:

• (a.) They are hybrid (combined) contracts containing at least an embedded derivaties and the host contract is an asset not within the scope of IFRS 9; or

• (b.) Eliminates or significantly reduces measurement or recognition; or

• (c.) A tool to manage and evaluate its performance on a fair value basis in accordance with a written risk management policy.

• b. Financial liabilities at FVTPL are stated at fair value upon initial recognition, related transaction costs and any gain or loss arising on remeasurement is recognized in profit or loss.

• c. A financial liabilities that designated as financial liabilities measured at FVTPL, which amount of change in fair value resulting from a change in credit risk, is recognized as other comprehensive income, and that will not be reclassified subsequently to profit or loss. The amount of the remaining fair value change in the liability is reported in the profit and loss. However, if the aforementioned accounting treatment triggers or exacerbates the improper accounting ratio, the full profits or losses of the liability are reported in the profit or loss.

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(B.) Derecognition of financial liabilities

A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expires. When derecognition of financial liabilities, the difference in the respective carrying amounts and the consideration paid, including any non-cash assets transferred or liabilities assumed, are recognized in profit or loss.

C. Modification of Financial Instruments

When the contractual cash flows of a financial instrument are renegotiated or modified and the renegotiation or modification does not result in the derecognition of that financial instrument, the Company recalculates the gross carrying amount of the financial asset or the amortized cost of the financial liabilities using the original effective interest rate and recognises a modification gain or loss in profit or loss. Any costs or fees incurred adjust the carrying amount of the modified financial instrument and are amortised over the remaining term of the modified financial instrument. If the renegotiation or modification results in that the derecognition of that financial instrument is required, then the financial instrument is derecognized accordingly.

If the basis for determining the contractual cash flows of a financial asset or financial liability changes resulting from interest rate benchmark reform and the change is necessary as a direct consequence of interest rate benchmark reform and the new basis for determining the contractual cash flows is economically equivalent to the previous basis, the Company applies the practical expedient to account for that change as a change in effective interest rate. If changes are made to a financial asset or financial liability in addition to changes to the basis for determining the contractual cash flows required by interest rate benchmark reform, the Company first applies the practical expedient aforementioned to the changes required by interest rate benchmark reform, and then applies the applicable requirements to any additional changes to which that practical expedient does not apply.

(7.) Inventories

Inventories, under a perpetual system, are measured at the lower of cost and net realisable value. Cost is determined using the weighted average method. The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production overheads (allocated based on normal operating capacity), excluding borrowing costs. The item-by-item approach is used in applying the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses.

(8.) Investments Accounted for Using Equity Method

Investments in subsidiaries are accounted for using the equity method. A subsidiary is an entity that is controlled by the Company.

Under the equity method, an investment in subsidiary is initially recognized at cost and adjusted thereafter to recognize the Company’s share of profit or loss and other comprehensive income of the subsidiary as well as the distribution received. The Company also recognized its share in change in the equity of subsidiaries.

Changes in the Company’s ownership interests in subsidiaries that do not result in the Company losing control over the subsidiaries are accounted for as equity transactions. Any difference between the carrying amount of the subsidiary and the fair value of the consideration paid or received is recognized directly in equity.

When the Company’s share of losses of a subsidiary equal or exceed its interest in that subsidiary (which includes any carrying amount of the investment in subsidiary accounted for by the equity method and long-term interests that, in substance, form part of the Company’s net investment in the subsidiary), the Company continues recognizing its share of further losses.

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When the Company loses control of a subsidiary, and retained investment of the former subsidiary is measured at fair value at that date. A gain of loss is recognized in profit or loss and calculated as the difference between 1) the aggregate of the fair value of consideration received and the fair value of any retained interest at the date when control is lost; and 2) the previous carrying amount of the investments in such subsidiary. In addition, the Company shall account for all amount previously recognized in other comprehensive income in relation to the subsidiary on the same basis as would be required if the subsidiary had directly disposed of the related assets and liabilities.

When the Company transacts with its subsidiaries, profits and losses resulting from the transactions with the subsidiaries are recognized in the Company’s parent company only financial statements only to the extent of interest in the subsidiaries that are not owned by the Company.

(9.) Property, Plant and Equipment

• A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized. For property, plant and equipment under construction, sample produced from testing whether the asset is functioning properly before its intended use are measured at lower of the costs or net realizable value. Proceeds from selling such an item and the cost of the item are recognized in profit or loss.

• B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be reliably measured. The carrying amount of the replaced component is derecognized. All other repairs and maintenance expense are recognized in profit or loss as incurred.

• C. Except for land, which is not depreciated, other items of property, plant and equipment are measured at cost, the depreciable amount shall be allocated by the straight-line method over its useful life. Depreciation methods, useful lives, and residual values are reviewed at the end of each reporting period. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in accounting estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change.

The estimated useful lives of property, plant and equipment are as follows:

Buildings: 5~55 Years

Machinery: 1~10 Years

Transportation: 5~8 Years

Office Equipment: 1~15 Years

Other Equipment: 1~10 Years

• D. If an item of property, plant and equipment or any significant component is disposed or there is no future economic benefit flow to the Company, the carrying amount is derecognized in profit and loss. The gain or loss arising from the derecognition of an item of property, plant and equipment shall be determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item, and it shall be recognized in profit and loss.

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(10.) Investment properties

Investment properties are properties held to earn rentals and/or for capital appreciation (including property under construction for such purposes) and include land held for a currently undetermined future use.

Owned investment properties are initially measured at cost, including transaction costs, and subsequently measured at cost less accumulated depreciation and accumulated impairment loss. All investment properties are depreciated using the straight-line method.

On derecognition of an investment property, the difference between the net disposal proceeds and the carrying amount of the asset is recognized in profit or loss.

(11.) Intangible Assets

• A. Intangible assets acquired separately (with finite useful lives)

Intangible assets acquired from government grants are measured at fair value. Intangible assets with finite useful lives that are acquired separately are initially measured at cost and subsequently measured at cost less accumulated amortization and accumulated impairment loss. Amortization is recognized on a straight-line basis as follow.

• (A.)Computer Software:1~10 Years

• (B.)Technology:10 Years

• (C.)License: The duration of patent right and the duration of the contract whichever is shorter

The estimated useful life, residual value, and amortization period and method are reviewed at the end of each reporting period, with the effect of any changes in estimates accounted for on a prospective basis.

• B. Internally-generated intangible assets - research and development expenditure

• (A.) Expenditure on research activities is recognized as an expense in the period in which it is incurred except for the goodwill or intangible assets from business combination.

• (B.) An internally-generated intangible asset arising from the development phase of an internal project is recognized if, and only if, all of the following conditions have been demonstrated:

  • a. The technical feasibility of completing the intangible asset so that it will be available for use or sale;

  • b. The intention to complete the intangible asset and use or sell it;

  • c. The ability to use or sell the intangible asset;

  • d. When the intangible asset could generate probable future economic benefits;

  • e. The availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and

  • f. The ability to measure reliably the expenditure attributable to the intangible asset during its development.

• (C.) Capitalized intangible assets in development phase are stated at cost, less accumulated amortization and accumulated impairment loss. Intangible assets with indefinite useful lives that are not amortizable.

• (D.) The assessment of intangible assets with indefinite life is reviewed annually to determine whether the useful lives of intangible asset with indefinite life continues to be with indefinite life. If not, the change in useful life from infinite to finite is recorded as change in accounting estimate.

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C. Disposal of the assets

Any gain or loss arising from the disposal of the assets is determined as the difference between the disposal proceeds and the carrying amount of the asset and is recognized in profit or loss.

• (12.) Impairment of Non-Financial Assets

The Company assesses at the end of reporting period the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and its value in use. When the indication of impairment loss recognized in prior years for an asset other than goodwill no longer exists, the impairment loss is reversed to the extent of the loss previously recognized in profit or loss.

Goodwill, intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually and recognize impairment loss if the carrying amount less than the recoverable amount. Goodwill cannot be reversed in future periods.

(13.) Provisions

Provisions are recognised when the Company has a present legal or constructive obligation from past events, and it is probable that an outflow of economic resources will be required to settle the obligation and the amount of the obligation can be reliably estimated. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation on the balance sheet date. The discount rate shall be a pre-tax rate that reflect current market assessment of the time value and the risk specific to the liability. Where discounting is used, the carrying amount of a provision increases in each period to reflect the passage of time. This increase is recognised as interest expense. Future operating loss is not recognized as provisions.

• (14.) Employee Benefits

• A. Short-term employee benefits

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

B. Pensions

• (A.)Defined contribution plans

For defined contribution plans, the contributions are recognised as pension expenses when they are due on an accrual basis. Prepaid contributions are recognised as an asset to the extent of a cash refund from the plan or a reduction in future contributions to the plan.

• (B.) Defined benefit plans

• a. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Company in current or prior period(s). The liability recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The defined benefit net obligation is estimated annually by independent actuaries using the projected unit credit method.

• b. Remeasurements of defined benefit plans are recognized in other comprehensive income as incurred and are recorded as retained earnings.

• c. Past-service costs are recognized immediately in profit or loss.

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C. Employee’s compensation and directors’ remuneration

• Employees’ compensation and directors’ and supervisors’ remuneration are recognised as expenses and liabilities, provided that such recognition is required under legal or constructive obligations and those amounts can be reliably estimated. Any difference between the amount accrued and the amount actually distributed is accounted for a change in accounting estimate.

D. Termination benefits

A liability for a termination benefit is recognized at the earlier of when the Company can no longer withdraw the offer of the termination benefit and when the Company recognize any related restructuring costs. The benefits expected to be due more than 12 months after balance sheet date should be discounted to the present value.

(15.) Taxation

• A. Income tax expenses include both current taxes and deferred taxes. Except for expenses related to the items recognized in other comprehensive income or directly in equity, all current and deferred taxes shall be recognized in profit or loss.

• B. The current income tax is calculated on the basis of the tax laws enacted or substantively enacted at the end of each reporting period in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. According to Income Tax Act in the R.O.C., income tax on unappropriated earnings is expensed in the year the shareholders’ meeting approved the appropriation of earnings which is the year subsequent to the year the earnings are generated.

• C. Deferred income tax is recognised, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss, and it does not give rise to equal deductible and taxable temporary differences at the time of transaction. Deferred tax is provided on temporary differences arising on investments in subsidiaries, except where the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

• D. Deferred tax assets arising from deductible temporary differences, unused loss carry forward and unused tax credits are only recognized to the extent that it is probable that there will be sufficient taxable profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future. The carrying amount of deferred tax assets is reviewed at the end of each reporting period.

• E. Current income tax assets and liabilities are offset and the net amount reported at the end of the reporting period when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset at the end of the reporting period when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same tax authority on either the same entity or different entities that intend to settle on a net basis or realize the asset and settle the liability simultaneously.

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• F. Tax credit resulting from acquisitions of equipment or technology, research and development expenditures, employee training, and equity investments to the extent that it is possible that future taxable profit will be available against which the unused tax credits can be utilized.

• (16.) Revenue

The Company identifies the contract with the customers, and recognizes revenue when performance obligations are satisfied.

• A. Revenue from sale of goods

Revenue from the sale of goods is mainly from sale of medical product. When a customer obtains control of promised goods, at which time the goods are delivered to the customer's specific location and performance obligation is satisfied.

• B. Royalties

Royalties are the rights of using intellectual property in authorized duration. The received royalties are recognized in royalty revenue on a time basis over the period of the authorization.

• C. Technical service

The Company provides research and development technology test services. Revenue from services is recognized as revenue during the period when services are provided to customers. If the services rendered exceed the payment, a contract asset is recognized. If the payments exceed the services rendered, a contract liability is recognized.

The Company’s estimates of revenue, costs and completion degree are revised with the test situation. Any income and cost increase or decrease caused by the estimated changes will be reflected in profit or loss during the period when the revision situation is known to the management.

• (17.) Borrowing costs

The borrowing cost directly attributable to the acquisition, construction or production of a qualified assets, is capitalized as part of the cost of the assets until substantially all necessary activities to reach the intended use or status for sale of the assets have been completed.

To the extent that an entity borrows funds specifically for the purpose of obtaining a qualifying asset, the entity shall determine the amount of borrowing costs eligible for capitalisation as the actual borrowing costs incurred on that borrowing during the period less any investment income on the temporary investment of those borrowings.

Except for the aforementioned, all other borrowing costs are recognized as profit or loss in the period in which they are incurred.

(18.) Government grants

Government grants are recognised at their fair value only when there is reasonable assurance that the Company will comply with any conditions attached to the grants and the grants will be received.

Government grants are recognized in profit or loss on a systematic basis over the periods in which the Company recognizes as expenses the related costs for which the grants are intended to compensate.

Government grants that are deemed as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Company with no future costs are recognized in profit or loss in the period in which they are receivable.

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(19.) Earnings per Share

The Company discloses the basic and diluted earnings per share attributable to ordinary equity holders of the Compnay. The calculation of basic earnings per share is based on the profit or loss attributable to the ordinary shareholders of the Compnay divided by the weighted-average number of ordinary shares outstanding. The calculation of diluted earnings per share is based on the profit or loss attributable to ordinary shareholders of the Compnay divided by the weighted-average number of ordinary shares outstanding after adjustment for the effect of all dilutive potential ordinary shares.

1. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Company’s accounting policies, the management is required to make judgments, estimations, and assumptions about the uncertain situation. The estimates and associated assumptions are based on historical experience and other factors considered relevant. Actual results may differ from these estimates.

The Company considers the economic implications of the changes in climates and related governmental policies and regulations, the conflicts between Ukraine and Russia as well as related international sanctions, inflation and volatility in interest rate when making its critical accounting estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised if the revisions affect only that period or in the period of the revisions and future periods if the revisions affect both current and future periods.

In the preparation of the parent company only financial statements, the critical accounting judgments the Company has made and the major sources of estimation and assumption uncertainty are described as follows:

• A. Critical judgements in applying accounting policies

Business model assessment for financial assets

The Company determines the business model at a level that reflects how companys of financial assets are managed together to achieve a particular business objective. This assessment involves judgment and consideration of all relevant evidence, such as how the performance of the assets is evaluated, the risks that affect the performance of the assets, and how the managers of the assets are compensated. The Company constantly assess the adequacy of its business model and monitors financial assets measured at amortized cost and debt investments measured at fair value through other comprehensive income. When these assets are derecognized prior to their maturity, the Company reviews the reasons for their disposal and whether the reasons are consistent with the objective of the business for which the assets were held. If the objective of the business for an asset is changed, the classification of the asset is prospectively changed from the reclassification date.

• B. Critical accounting estimates and assumptions

(A.)Revenue Recognition

Sales revenue, excluding related estimated sales returns, discounts and other similar allowance, is recognized when the control of goods or services is transferred to the customer and the Company satisfies it performance obligation. The Company estimates sales returns and allowance based on historical experience and other known factors. The Company assesses the reasonableness of the estimates periodically.

(B.)Estimated impairment of financial assets

The provision for impairment of accounts receivables, debt investments, and financial guarantee contracts is based on assumptions on default risk and expected loss rates. The Company makes these assumptions and selects inputs for impairment calculation based on the Company’s historical experience and existing market conditions, as well as forward looking information. If the future cash inflows are less than expected, a material impairment loss may arise. Please refer to Note 6(5.)for the assumption and input data.

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(C.)Evaluation of inventories

As inventories are stated at the lower of cost and net realisable value, the Company must determine the net realisable value of inventories on balance sheet date using judgements and estimates. The Company evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realisable value. The management considers current market and historical experience on sperific future product demand for evaluation basis, and charge of these factors may significantly affect the results.

(D.)The useful life of property, plant and equipment

Property, plant and equipment are amortized on a straight-line basis, and the Company periodically evaluates the useful life and residual value of property, plant and equipment. If there is a significant change in the relevant estimates, it will be adjusted in the current period of the change and in subsequent years.

(E.)Realisability of deferred tax assets

Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the deferred tax asset can be utilised. If future generated profit less than expected, there would be significant reversed of deferred tax assets recognized as profit and loss when occured.

6. DETAILS OF SIGNIFICANT ACCOUNTS

• (1.) Cash and Cash Equivalents

ITEM Cash on hand Check deposits Demand deposits Cash equivalent Time deposits (Investments with original maturities less than 1 year) Total	31-Dec-23 $ 1,962 1,832 548,724 148,480 $ 700,998	31-Dec-22
		$ 1,713 1,209 613,469 86,664
		$ 703,055

• A.The Company trades with a variety of financial institutions all with high credit quality to disperse credit risk, and the management expects that the probability of counterparty default is remote.

B.The cash and cash equivalents were not pledged.

• (2.) Notes Receivable, Net

ITEM Notes receivable Less: Allowance for impairment loss	31-Dec-23 $ 164,407 (507) $ 163,900	31-Dec-22 $ 179,178 (353) $ 178,825

• A. As of December 31, 2023 and 2022, the notes receivables were not pledged.

• B. Please refer to table below for the information about the disclosures on allowance for impairment loss for accounts receivable.

• 25 -

(3.) Accounts Receivable, Net

Accounts Receivable, Net
ITEM		31-Dec-23		31-Dec-22
Accounts receivable
Gross carrying amount measured at amortized cost	$	433,261	$	462,300
Less: Allowance for impairment loss		(7,259)		(5,714)
	$	426,002	$	456,586

• A. The Company’s average credit terms of accounts receivable were 30 to 120 days, which was determined with factors of customers’ industrial environment, business scales and profitability.

• B. The accounts receivable were not pledged.

• C. The Company applies the simplified approach to provisions for expected credit losses, which permits the use of a lifetime expected credit losses provision for all notes receivable and accounts receivable. The lifetime expected credit losses on accounts receivables are estimated by reference to past default experience with the respective debtors and an analysis of the debtors’ current financial positions. According to the past experience of credit loss, there is no significant difference between different customer categories, thus the provision matrix doesn’t further distinguish customer categories, and is set up the expected credit loss ratio by the past due days.

The following table details the loss allowance of note receivables and accounts receivables based on the Company’s provision matrix.

December 31,2023 Not past due 0 to 60 days 61 to 120 days 121 to 180 days Over 181 days Total December 31,2022 Not past due 0 to 60 days 61 to 120 days 121 to 180 days Over 181 days Total	Expected Credit Loss Ratio 0%~1% 5% 30% 50% 100% Expected Credit Loss Ratio 0%~1% 5% 30% 50% 100%	Gross Carrying Amount $ 564,031 26,827 521 223 6,066 $ 597,668 Gross Carrying Amount $ 623,321 9,792 3,806 952 3,607 $ 641,478	Loss Allowance (Lifetime ECL) $ 91 1,341 156 112 6,066 $ 7,766 Loss Allowance (Lifetime ECL) $ 353 489 1,142 476 3,607 $ 6,067	Amortized Cost
				$ 563,940 25,486 365 111 -
				$ 589,902
				Amortized Cost
				$ 622,968 9,303 2,664 476 -
				$ 635,411

• D. The movements of the loss allowances of notes receivable and accounts receivable, including those from related parties, were as follows:

Opening Balance Add: Impairment loss Closing Balance	For the Year Ended December31 2023 2022 $ 6,067 $ 4,198 1,699 1,869 $ 7,766$ 6,067

• 26 -

• E. These amounts were recognized without considering other credit enhancements held by the Company. The Company writes off an accounts receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery. However, the Company continues to engage in enforcement activity to recover the receivables due. Any recovered amounts are recognized in profit or loss.

• F. Please refer to Note 12 for information about the related credit risk management and the valuation techniques.

• (4.) Inventories

Inventories
ITEM		31-Dec-23		31-Dec-22
Merchandise	$	2,727	$	826
Finished goods		279,322		232,422
Work in process		71,551		83,569
Raw materials		308,813		254,293
Materials		39,902		43,946
Materials and supplies in transit		3,459		-
Total	$	705,774	$	615,056

• A. Cost of revenue related to inventories recognized in profit or loss as follows:

ITEM Cost of goods sold Loss on decline (gain on reversal) in market value of inventories Loss on inventory scrapped Others Total	For the Year Ended December31	For the Year Ended December31
	2023 $ 1,701,227 (28,015) 11,268 (286) $ 1,684,194	2022
		$ 1,559,756 2,188 16,838 (1,571)
		$ 1,577,211

• B. No inventories were pledged or held as collateral.

• (5.) Financial Assets at Fair Value through profit and loss / other comprehensive income – non-current

ITEM Financial assets mandatorily measured at fair value through profit or loss Overseas unlisted preferred shares PHYTOCEUTICA INC. CANCAP PHARMACEUTICAL, LTD. Less: Accumulated impairments Total Financial assets mandatorily measured at fair value throughother comprehensive income Domestic unlisted ordinary shares Less: Valuation adjustments Total	31-Dec-23 $ 4,844 2,394 7,238 (4,844) $ 2,394 $ 12,126 (1,990) $ 10,136	31-Dec-22
		$ 4,844 1,219
		6,063 (4,844)
		$ 1,219
		$ 9,676 (68)
		$ 9,608

• A. The Company invested in the preferred stocks of PHYTOCEUTICA INC., it is not entitled to other rights of ordinary shares, except for that dividends and distribution of residual assets preferred over ordinary shares.

• 27 -

• B. These investments in equity instruments were held for long-term strategic purposes. Accordingly, the management elected to designate these investments in equity instruments as at FVTOCI.

• C. As of December 31, 2023 and 2022, the financial assets at fair value through profit or loss were not pledged or held as collateral.

• D. Please refer to Note 12 for information about the related credit risk management and the valuation techniques.

• (6.) Investments Accounted for Using Equity Method

Name of Investee CANCAP PHARMACEUTICAL LTD. (ordinary shares) SUNETIC BIOTECH INC. UJNIVERSAL NEXT TECHNOLOGIES INC. ZuniMed Biotech Co., Ltd. SynCore Biotechnology Co., Ltd. Total Add: Transfer into debit item of financial asset at FV through PL FVTPL	31-Dec-23	31-Dec-23	Carrying Amount $ (123,853) 815,584 27 91,199 229,301 1,012,258 123,853 $ 1,136,111	31-Dec-22	31-Dec-22	Carrying Amount $ (125,028) 915,635 39 91,660 154,419 1,036,725 125,028 $ 1,161,753
	Original Investment Amount $ 44,605 745,748 17,467 109,990 1,864,935 $ 2,782,745	Percentage Of Ownership 88.43% 83.47% 100.00% 100.00% 64.26%		Original Investment Amount	Percentage Of Ownership 88.43% 83.47% 100.00% 100.00% 62.09%
				$ 44,605 745,748 17,467 109,990 1,745,698
				$ 2,663,508

• A. As of December 31, 2023 and 2022, the investment accounted for using equity method for CANCAP PHARMACEUTICAL LTD. has been consistently dealing with operating deficit. This caused the Company to carry a credit balance on the carrying amount of its related long-term investment. The Company also owns the preference shares of the investee, hence the credit balance amounted to NT$123,853 thousand and NT$125,028 thousand were respectively debited as Financial Assets at Fair Value through Profit and Loss.

• B. The Company received cash dividends from subsidiary SUNETIC BIOTECH. INC. amounted to NT$71,824 thousand and NT$44,405 thousand for the years ended December 31, 2023 and 2022, respectively..

• C. The Subsidiary, SynCore Biotechnology Co., Ltd.’s shareholders held a meeting on May 5, 2023, and resolved to cover deficit by reducing capital by NT$843,325 thousand, writing off 84,332 thousand shares (including privately placed equuity 33,131 thousand shares). The ratio of capital reduced was 73.28%. The registration had been completed on May 31, 2023.

• D. The Subsidiary, SynCore Biotechnology Co., Ltd.’s Board of Directors resolved on August 8, 2023 to raise capital through the issuance of 4,420 thousand ordinary shares. Amount to be issued through the cash capital increase is $NTD150,280 thousand at a subscription price of $NTD34 per share. The Company subscribed for NT$119,237 thousand for 3,507 thousand shares. Due to non-proportionate subscription to SynCore’s issuance of new capital share, the Company recognized adjustment to reduce capital surplus and retained earning for NT$ 5,832 thousand and 13,969 thousand, respectively.

• 28 -

• E. The stocks of SynCore Biotechnology Co, Ltd are listed for publicly traded. As of December 31, 2023 and 2022, the Company held its shares with market values amounted to NT$784,439 thousand and NT$1,380,084 thousand, respectively and there were 2,169 thousand shares and 17,122 thousand shares, excluded in the computation of the market value due to the regulation about privately placed equity shares with 3 years resell limit.

• F. The amount of profit and loss and other comprehensive income accounted for using equity method in 2023 and 2022 are calculated based on the financial statements audited by a CPA of the same period.

• G. Please refer to Note 13 for the information of investments accounted for using equity method.

• (7.) Property, Plant and Equipment

Cost 1-Jan-23 Additions Disposals Reclassification 31-Dec-23 Accumulated depreciation and Impairment 1-Jan-23 Depreciation Disposals Reclassification 31-Dec-23 Cost 1-Jan-22 Additions Disposals Reclassification 31-Dec-22 Accumulated Depreciation and Impairment 1-Jan-22 Depreciation Disposals 31-Dec-22 CarryingAmount 31-Dec-23 31-Dec-22	Land $ 487,277 - - 96,683 $ 583,960 $ - - - - $ - $ 487,277 - - - $ 487,277 $ - - - $ - $ 583,960 $ 487,277	Buildings $ 1,939,115 11,422 - 79,204 $ 2,029,741 $ 823,349 60,875 - 9,088 $ 893,312 $ 1,909,362 10,296 - 19,457 $ 1,939,115 $ 764,350 58,999 - $ 823,349 $ 1,136,429 $ 1,115,766	Machinery $ 1,215,351 30,011 (14,289) 119,883 $ 1,350,956 $ 931,520 68,810 (13,592) - $ 986,738 $ 1,185,808 9,989 (3,516) 23,070 $ 1,215,351 $ 868,119 66,448 (3,047) $ 931,520 $ 364,218 $ 283,831	Other Equipment $ 226,606 15,664 (10,056) 3,156 $ 235,370 $ 165,824 14,355 (10,056) - $ 170,123 $ 203,381 18,517 (382) 5,090 $ 226,606 $ 154,043 12,143 (362) $ 165,824 $ 65,247 $ 60,782	Unfinished Construction and Equipments Pending Acceptance $ 72,622 115,721 - (58,638) $ 129,705 $ - - - - $ - $ 66,323 37,271 - (30,972) $ 72,622 $ - - - $ - $ 129,705 $ 72,622	Total
						$ 3,940,971 172,818 (24,345) 240,288
						$ 4,329,732
						$ 1,920,693 144,040 (23,648) 9,088
						$ 2,050,173
						$ 3,852,151 76,073 (3,898) 16,645
						$ 3,940,971
						$ 1,786,512 137,590 (3,409)
						$ 1,920,693
						$ 2,279,559
						$ 2,020,278

• 29 -

• A. The property, plant and equipment were pledged or held as collateral, please refer to Note 8 for details.

• B. As of December 31, 2023 and 2022, the Company acquired agricultural lands from non-related parties for the purpose of plant planning which could not be registered ownership of the Company. The acquisition cost was NT$23,184 thousand, and the land was registered in the name of Shu Fei Yu. To protect the interest of the Company, the mortgage right of the land was registed belong to the Company.

(8.) Investment Properties

				Land		Buildings		Total
	Cost
1-Jan-23			$	182,880	$	71,884	$	254,764
Additions				-		-		-
Reclassification				(96,683)		(38,003)		(134,686)
31-Dec-23			$	86,197	$	33,881	$	120,078
Accumulated	depreciation	and
impairments
1-Jan-23			$	-	$	16,803	$	16,803
Depreciation expense				-		975		975
Reclassification				-		(9,088)		(9,088)
31-Dec-23			$	-	$	8,690	$	8,690
	Cost
1-Jan-22			$	182,880	$	71,884	$	254,764
Additions				-		-		-
31-Dec-22			$	182,880	$	71,884	$	254,764
Accumulated	depreciation	and
impairments
1-Jan-22			$	-	$	15,256	$	15,256
Depreciation expense				-		1,547		1,547
31-Dec-22			$	-	$	16,803	$	16,803
CarryingAmount
31-Dec-23			$	86,197	$	25,191	$	111,388
31-Dec-22			$	182,880	$	55,081	$	237,961

• A. Rental income from investment properties and direct operating expenses arising from investment property are shown below:

shown below:
Rental income from investment properties Direct operating expenses arising from the investment properties that generated rental income during the period	For the Year Ended December31
	2023 $ 4,737 $ 1,288	2022
		$ 7,404
		$ 2,167

B. Investment properties are depreciated on a straight-line basis based on 15~50 years useful lives.

• C. The investment properties that are not valued by an external independent valuer are valued by the Company’s management using the rental of adjacent area as reference. This was the cash flow approach and belonged to the level 3 fair value measurement. The fair values as at December 31, 2023 and 2022 were amounted to NT$135,375 thousands and NT$338,395 thousands, respectively.

• D. Information on investment properties pledged to others as collaterals is provided in Note 8.

• 30 -

(9.) Intangible Assets

ntangible Assets
ITEM Software Less: Accumulated amortization and impairment Net 1-Jan-23 Additions Disposals Reclassification 31-Dec-23	Dec-31-23 Dec-31-22 $ 86,609 $ 90,855 (65,898) (62,389) $ 20,711$ 28,466 Software		Dec-31-22
	$		$	90,855 (62,389)
	$		$	28,466
	Cost $ 90,855 5,064 (9,533) 223 $ 86,609	Accumulated amortization and impairment $ (62,389) (13,042) 9,533 - $ (65,898)		Carrying Amount
				$ 28,466 (7,978) - 223
				$ 20,711

1-Jan-22 Additions Disposals 31-Dec-22		Software
	Cost $ 94,481 10,236 (13,862) $ 90,855	Accumulated amortization and impairment $ (59,453) (16,798) 13,862 $ (62,389)	Carrying Amount
			$ 35,028 (6,562) -
			$ 28,466

The software was pledged as collateral for long-term loans, please refer to Note 8.

• (10.) Short-term loans

31-Dec-23

Category		Amount		Interest Rate
Unsecured loans	$	360,000		1.75%~1.95%
		31-Dec-22
Category		Amount		Interest Rate
Unsecured loans	$	360,000		1.44%~2.12%
Long-term loans and current portion of long-term		liabilities
ITEM		31-Dec-23		31-Dec-22
Secured loans	$	1,244,963	$	1,192,935
Unsecured loans		290,000		260,000
Subtotal		1,534,963		1,452,935
Less: current portion		(48,490)		(48,116)
Total	$	1,486,473	$	1,404,819
Interest Rate		1.650%~2.415%		1.525%~2.283%

(11.) Long-term loans and current portion of long-term liabilities

Please refer to Note 8 for collaterals pledged for long-term borrowings.

(12.) Retirement Benefit Plans

Defined contribution plans

A. The employee pension plan under the Labor Pension Act of the R.O.C. (the Act) is a defined contribution plan. Pursuant to the plan, the Company make monthly contributions of 6% of each individual employee’s salary or wage to employees’ pension accounts.

• 31 -

• B. NT$22,000 thousand and NT$19,435 thousand were contributed by the Company for the years ended December 31, 2023 and 2022, respectively.

Defined benefit plan

The Company and its domestic subsidiaries have defined benefit pension plans in accordance with the Labor Standards Law of the R.O.C. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company contributes monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited in Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. The Company would assess as the balance in the aforementioned labor pension reserve account by the end of each year. If the account balance is not enough to pay the pension to the labors expected to be qualified for retirement in the next year, the Company will make contribution for the deficit by next March. The pension fund is managed by the government’s designated authorities and the Company has no right to influence their investment strategies.

A. Amounts recognized in the parent company only balance sheets are as follows:

ITEM		31-Dec-23	31-Dec-23		31-Dec-22	31-Dec-22
Present value of defined
benefit obligations		$	164,129		$	165,248
Fairvalue ofplan assets			(128,577)			(129,270)
Net defined benefit liability		$	35,552		$	35,978

• B. Movements of net defined benefit liabilities were as follows:

			For the Year Ended December31,2023
			Present value of		Fair value of plan asset
			defined benefit		Fair value of plan			Net defined benefit
ITEM			obligations		asset				liability
		$	165,248		$	(129,270)		$
BALANCE at JANUARY 1			165,248						35,978
Service cost:
			680
Current service cost			680			-			680
Interest expense(revenue)			2,118			(1,662)			456
			2,798			(1,662)
Recognized inprofit or loss			2,798						1,136
Remeasurement on the net
defined benefit liability:
Return on plan assets			-			(1,130)			(1,130)
Actuarial (gains) losses
Effect of changes in					- -
demographic assumptions			-			-			-
Effect of changes in
financial assumptions			1,397			-			1,397
Experience adjustments			3,469			-			3,469
Components of defined benefit			4,866		(1,130)
costs recognized in other
comprehensive income			4,866						3,736
Pension fund contribution			-			(5,298)			(5,298)
Paid Pension			(8,783)
						8,783			-
Balance at December 31		$	164,129		$	(128,577)		$	35,552

• 32 -

For the Year Ended December 31, 2022

	For the Year Ended December31,2022	For the Year Ended December31,2022	For the Year Ended December31,2022	For the Year Ended December31,2022	For the Year Ended December31,2022	For the Year Ended December31,2022	For the Year Ended December31,2022	For the Year Ended December31,2022	For the Year Ended December31,2022	For the Year Ended December31,2022
		Present value of			Fair value of plan asset
		defined benefit			Fair value of plan				Net defined benefit
ITEM		obligations			asset				liability
		$	171,779		$	(120,890)			$
BALANCE at JANUARY 1			171,779							50,889
Service cost:
Current service cost			1,075			-				1,075
		1,182				(832)
Interest expense(revenue)			1,182							350
		2,257				(832)
Recognized inprofit or loss			2,257							1,425
Remeasurement on the net
defined benefit liability:
Return on plan assets		-				(9,475)				(9,475)
Actuarial (gains) losses
Effect of changes in					- -
demographic assumptions			8			-				8
Effect of changes in
financial assumptions			(9,474)							(9,474)
						-
Experience adjustments			9,861			-				9,861
Components of defined benefit		395			(9,475)
costs recognized in other
comprehensive income										(9,080)
Pension fund contribution		-				(7,256)				(7,256)
Paid Pension			(9,183)		9,183				-
Balance at December 31		$ 165,248			$	(129,270)			$ 35,978
C. The defined benefit plan as of t Operation Costs Selling Expense Administrative Expense Research and Development Expense		he year ended 2023 and 2022 were summarized by functions as follows: 31-Dec-23 31-Dec-22 $ 516 $ 648 354 408 224 293 42 76 $ 1,136 $ 1,425
							$ 648 408 293 76
							$ 1,425

• D. Through the defined benefit plans under the Labor Standards Law, the Company is exposed to the following risks:

(A.)Investment risk

The pension funds are invested in equity and debt securities, bank deposits, etc. at the discretion of the Bureau of Labor Funds of Ministry of Labor, or under the mandated management. However, under the Labor Standards Law, the rate of return on plan assets shall not be less than the average interest rate on a two-year time deposit published by the local banks.

(B.)Interest risk

A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the debt investments of the plan assets.

(C.)Salary risk

The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.

• 33 -

E. The main actuarial assumptions used were as follows:

	31-Dec-23		31-Dec-22
Discount rate	1.20%		1.30%
Expected rate of salaryincrease	1.50%		1.50%
The weighted average duration of the
	8 years		9 years
defined benefit obligation

• (A.) Assumptions on future mortality experience are set based on the 6th Taiwan Standard Ordinary Experience Mortality Table (TSO).

• (B.) The sensitivity analysis:

If significant actuarial assumptions change reasonably and all other assumptions are held constant, the present value of the defined benefit obligation may increase(decrease) as below:

ITEM		31-Dec-23	31-Dec-23			31-Dec-22
Discount rate	$ (3,459) $ (3,727) (1,397) (1,506) 3,571 3,854 1,415 1,526 3,552 3,837 (3,457) (3,729) (15) (26) 15 26
0.25% increase
0.1% increase
0.25% decrease
0.1% decrease
Future salaryincrease rate
0.25% increase
0.25% decrease
Employee turnover rate
110% of the expected
employee turnover rate
90% of the expected
employee turnover rate			15			26

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated .

• F. The contribution that the Company expects to make to its defined benefit pension plans in next year is NT$834 thousand.

Other Employees’ benefits were as follows:

ITEM Employees benefits payable Compensated absences payable Other employees benefits Total	31-Dec-23 $ 10,485 5,264 16,314 $ 32,063	31-Dec-22
		$ 9,647 4,846 15,029
		$ 29,522

• (13.) Capital Stock

The movements in the number of the Company's ordinary shares outstanding are as follows:

For the Year Ended December 31, 2023

Issued and paid shares (in thousands) Issued capital January 1 167,722 $ 1,677,221 December 31 167,722 $ 1,677,221

For the Year Ended December 31, 2022

Issued and paid shares (in thousands) 167,722 167,722	Issued capital
	$ 1,677,221
	$ 1,677,221

January 1 December 31

• 34 -

As of Dec 31, 2023 the Company’s authorized capital amount was NT$2,500,000 thousand, consisting of 250,000 thousand shares of ordinary stocks.

• (14.) Capital Surplus

Capital Surplus
ITEM Additional paid in capital Additional paid-in capital arising from bond conversion Difference between consideration and carrying amount of subsidiaries acquired or disposed Changes in ownership interest in Subsidiaries Others Total	31-Dec-23 $ 422,450 190,611 310,439 - 640 $ 924,140	31-Dec-22
		$ 422,450 190,611 310,439 5,832 640
		$ 929,972

Under the Company Act, the capital surplus generated from excess of the issuance price over the par value of capital stock and donations may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as stock dividends or cash dividends. Further, the R.O.C. Securities and Exchange Law requires that the amount of capital surplus to be capitalized mentioned above should not exceed a certain percentage of the Compnay’s paid in capital each year. Capital surplus should not be used to cover accumulated deficit unless the legal reserve is insufficient.

(15.) Accumulated Deficit and Dividend Policy

• A. When allocating the net profits in each fiscal year, Sinphar shall be first utilized for paying taxes, offsetting losses of previous years, and then setting aside the 1) legal capital reserve at 10% of the profits left over, until the accumulated legal capital reverse equals Sinphar’s paid-in capital; 2) special capital reverse in accordance with relevant laws or regulations or as requested by the authorities in charge; and 3) balance left over shall be allocated according to the resolution of the board of directors and the shareholders’ meeting.

• B. To consider about the economic circumstances, development phase, and future business expansion, dividends will be allocated in consideration of future capital expenditure and cash forecast. However, cash dividends are limited to over 20% of total dividends distributed.

• C. The appropriation for legal capital reserve shall be made until the reserve equals the Company’s paid-in capital. The reserve may be used to offset deficit, or be distributed as dividends in cash or stocks for the portion in excess of 25% of the paid-in capital if the Company incurs no loss.

• D. Special Reserve ：

ial Reserve：
ITEMS Amount when first applied to IFRSs Amount aroused from other equity interest Total	31-Dec-23 $ 37,951 83,416 $ 121,367	31-Dec-22
		$ 37,951 53,124
		$ 91,075

• (A.) In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.

• (B.) When IFRSs were first adopted, according to the special reserve regulation of Financial Supervisory Commission R.O.C, no. 1010012865 on April 6, 101, If the company subsequently uses, disposes or reclassifies the relevant assets, the proportion originally set aside as the special reserve will be reversed into distributable retained earnings.

• 35 -

• E. The appropriations of earnings for 2022 had been approved by the company’s shareholders in its meeting held on June 20, 2023 and the appropriations and dividends per share were as follows:

Appropriation of Earnings			Dividends Per Share(NT$)
$	23,373	$		-
	30,292			-
	167,722			1
$	221,387

• F. The resolutions of 2021 deficit compensation have been approved by the company’s shareholders in its meeting held on June 21, 2022. The deficit would be covered with legal capital reserve and distribute cash dividend of NT$0.2 per share, based on the amount NT$33,544 thousand of capital surplus upon issuance.

• G. The appropriations of earnings for 2023 had been approved in the meeting of the Board of Directors on March 6, 2024 and the appropriations and dividends per share were as follows:

	Appropriation of Earnings				Dividends Per Share(NT$)
Legal capital reserve	$	36,980	$		-
Special capital reserve		15,804			-
Cash dividends of ordinaryshare		167,722			1
Stock dividends of ordinaryshare		134,178			0.8
Total	$	354,684

The appropriations of earnings for 2023 are to be presented for approval in the shareholders’ meeting which is to be held on June 19, 2024.

• H. Information on the resolution of the Board of Directors' and shareholders' meetings regarding the appropriation of earnings is available from the Market Observation Post System on the website of the TWSE.

• (16.) Others Equity Items

Others Equity Items
ITEM Balance as at Jan 1, 2023 Exchange differences on translation of foreign financial statements Income tax effects Unrealized gain on financial assets at FVTOCI Share of other comprehensive income of associates accounted for using the equity method Balance as at Dec 31, 2023 Balance as at Jan 1, 2022 Exchange differences on translation of foreign financial statements Income tax effects Unrealized gain on financial assets at FVTOCI Share of other comprehensive income of associates accounted for using the equity method Balance as at Dec, 2022	Exchange differences on translation of foreign financial statements $ (80,701) (15,045) 3,009 - 17 $ (92,720) $ (91,854) 13,919 (2,784) - 18 $ (80,701)	Unrealized Gain (Loss) on Financial Assets at Fair Value Through Other Comprehensive Income $ (40,667) - - (1,922) (1,862) $ (44,451) $ (37,325) - - (68) (3,274) $ (40,667)	Total
			$ (121,368) (15,045) 3,009 (1,922) (1,845)
			$ (137,171)
			$ (129,179) 13,919 (2,784) (68) (3,256)
			$ (121,368)

• 36 -

(17.) Net Revenue

Net Revenue
ITEM Revenue from contracts with customers Net revenue from the sale of goods Less: Sales returns Less: Sales discounts Total	FortheYear EndedDecember31
	2023 $ 3,061,081 (19,757) (324,114) $ 2,717,210	2022
		$ 2,846,628 (15,124) (320,298)
		$ 2,511,206

• A. Breakdowns of contract revenue

• (A.) Please refer to Note 14 for geographical and departmental information details.

• (B.) Revenue was recognized at a specific point of time period when all the obligations were fulfilled.

• B. Contract Balance

The accounts receivable and contract liabilities in relation to contract revenue were as follows:

ITEM Accounts Receivable (6(3.)) Contract liabilities-current	31-Dec-23 $ 426,002 $ 84,352	31-Dec-22 $ 456,586 $ 93,235	1-Jan-22
			$ 365,301
			$ 92,307

• (A.) Changes in contract liabilities mainly result from the time difference between the performance obligation satisfied and the customer’s payment.

• (B.) Revenue from opening contract liabilities - sales of goods recognized as revenue in the current period were as follows:

as follows:
Revenue Amounts from opening contract liabilities - sales of good Other Income ITEM Government grants Rental income Others Total	For the Year Ended December 31
	2023 2022 $ 80,344 $ 84,649 FortheYear EndedDecember31	2022
		$ 84,649
	2023 $ 1,371 12,782 22,621 $ 36,774	2022
		$ 828 15,543 23,855
		$ 40,266

• (18.) Other Income

• (19.) Other Gains and Losses

Other Gains and Losses
ITEM Net currency exchange gains (losses) Gains (losses) on disposal of assets Others Total	For the Year Ended December31
	2023 $ (3,530) 5,145 (6,507) $ (4,892)	2022
		$ 15,314 (402) (3,205)
		$ 11,707

• 37 -

(20.) Employee Benefits Expense, Depreciation and Amortization

ITEM Employee benefits expense Salaries and wages Labor and health insurance Pension Remuneration to directors Other employee benefits Depreciation Amortization Total	For the Year Ended December 31, 2023	For the Year Ended December 31, 2023	For the Year Ended December 31, 2023
	Cost of revenue $ 258,661 29,035 12,172 - 17,137 115,307 5,647 $ 437,959	Operating expenses $ 281,560 23,793 10,964 8,682 20,115 28,733 23,546 $ 397,393	Total
			$ 540,221 52,828 23,136 8,682 37,252 144,040 29,193
			$ 835,352

ITEM Employee benefits expense Salaries and wages Labor and health insurance Pension Remuneration to directors Other employee benefits Depreciation Amortization Total	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022
	Cost of revenue $ 242,959 24,608 11,088 - 15,420 110,227 3,473 $ 407,775	Operating expenses $ 253,658 20,627 9,772 8,194 17,046 27,362 37,734 $ 374,393	Total
			$ 496,617 45,235 20,860 8,194 32,466 137,589 41,207
			$ 782,168

• A. As of December 31, 2023, and 2022, the number of employees of the Company were 823 and 775, respectively, the directors who have not served as employees were both 6.

• B. The average employee benefits expense are NT$ 800 thousand and NT$ 774 thousand in 2023 and 2022, respectively.

• C. The average salaries and wages are NT$ 661 thousand and NT$ 646 thousand in 2023 and 2022, respectively.

• D. The adjustment rate of average salaries and wages is 2%.

• E. Salary Policy

Directors’ remuneration

• (A) The Company's Articles of Incorporation stipulate that the remuneration for all directors is determined by

• the board of directors, regardless of operating profit or loss, which would be paid at the usual level of the industry.

• (B) The Company's Articles of Incorporation stipulate the company shall allocate not higher than 5% of annual profits during the period to directors’ and supervisors’ remuneration.

Executive compensation

The remuneration for the management of the Company is based on the nature of the department, personnel positioning, work performance and business development progress, and is reviewed by the remuneration committee and resolved by the board of directors.

Employees’ compensation

The remuneration of the Company’s employees includes the salary, various allowances, position subsidy additions, overtime wages and various bonuses, as well as the employee remuneration paid by the Company according to the annual profitability. The Company's Articles of Incorporation stipulate the company shall allocate 2%~8% of income before income tax during the period to employees’ compensation.

• 38 -

• F. The employees’ compensation and directors’ and supervisors’ remuneration for 2023 and 2022 were approved in the meetings of the Board of Directors on March 6, 2024 and March 17, 2023, respectively. The amounts recognized in the financial reports were as follows:

Amount resolved to be distributed Amount recognized in financial reports Difference	2023 Employees’ compensation Directors’ and supervisors’ remuneration $ 10,485 $ 5,898 10,485 5,898 $ - $ -	2022	2022
	Employees’ compensation $ 10,485 10,485 $ -	Employees’ compensation $ 9,647 9,647 $ -	Directors’ and supervisors’ remuneration
			$ 5,426 5,426
			$ -

The above-mentioned compensation was distributed in cash.

• G. The information about employees’ compensation and directors’ and supervisors’ remuneration of the company as resolved by the meeting of Board of Directors is available from the Market Observation Post System on the website of the TWSE.

• (21.) Finance Costs

.) Finance Costs
ITEM Interest expense - bank loans Interest expense - long term payables Total	For the Year Ended December 31
	2023 $ 32,114 - $ 32,114	2022
		$ 24,997 10
		$ 25,007

• (22.) Income Tax

A. The components of tax expense (benefit):

The components of tax expense (benefit):
For the Year Ended December31 ITEM 2023 2022 Current tax Current tax expense recognized in the current year $ (70,596) $ 39,894 Adjustments for prior periods 777 179 Total $ (69,819) $ 40,073 Deferred tax Deferred income tax related to origination and reversal of temporary differences 5,910 21,675 Income tax expense (benefit) $ (63,909) $ 61,748 Income tax recognized in other comprehensive (income) loss: For the Year Ended December31 ITEM 2023 2022 Currency translation differences $ (3,009) $ 2,784	For the Year Ended December31
		2022
		$ 39,894 179
		$ 40,073
		21,675
		$ 61,748
	2023 $ (3,009)	2022
		$ 2,784

B. Income tax recognized in other comprehensive (income) loss:

• 39 -

C. Reconciliation between income tax expense (benefit) and accounting loss as follows:

Reconciliation between income tax expense (benefit)	and accounting loss as follows:	and accounting loss as follows:
ITEM Profit before income tax Tax calculated based on profit before tax and statutory tax rate Effects from items disallowed by tax regulation The Income from Income Basic Tax Act Investment tax credit Income tax from subsidiaries dividends Net change in deferred income tax Income tax adjustments for prior years Foreign tax credit Income tax expense (benefit)	For the Year Ended December 31
	2023 $ 311,261 $ 62,252 (105,564) - (41,649) 14,365 5,910 777 - $ (63,909)	2022
		$ 286,392
		$ 57,278 16,628 3,637 (33,260) 8,881 12,794 179 (4,389)
		$ 61,748

Under the Act for the Development of Biotech and Pharmaceutical Industry, the Company could recognize

an investment tax credit within a limit of 20% of the investment price if the investee is applicable to the act.

D. Deferred income tax assets and liabilities

Deferred tax assets or liabilities arising from temporary differences, operating loss carryforward, and investment tax credits:

investment tax credits:
Deferred income tax asset Temporary difference Employee benefits Sales returns and allowances Unrealized loss on inventories Exchange difference on foreign operations Others Operating loss carryforwards Investment tax credit Deferred income tax liabilities Temporary difference Land value increment tax Gain on foreign investments accounted for using the equity method		For the Year Ended December 31,2023
	Jan-1 $ 3,006 11,264 16,867 20,173 798 - - $ 52,108 $ 32,939 1,692 $ 34,631	Profit and loss $ 257 (554) (5,603) - (10) 80,000 41,649 $ 115,739 $ - 51,053 $ 51,053	Other comprehensive income $ - - - 3,009 - - - $ 3,009 $ - - $ -	Dec-31
				$ 3,263 10,710 11,264 23,182 788 80,000 41,649
				$ 170,856
				$ 32,939 52,745
				$ 85,684

• 40 -

Deferred income tax asset Temporary difference Employee benefits Sales returns and allowances Unrealized loss on inventories Exchange difference on foreign operations Others Investment tax credit Deferred income tax liabilities Temporary difference Land value increment tax Gain on foreign investments accounted for using the equity method		For the Year Ended December 31,2022	For the Year Ended December 31,2022
	Jan-1 $ 2,980 12,780 16,429 22,957 1,392 18,337 $ 74,875 $ 32,939 - $ 32,939	Profit and loss $ 26 (1,516) 438 - (594) (18,337) $ (19,983) $ - 1,692 $ 1,692	Other comprehensive income $ - - - (2,784) - - $ (2,784) $ - - $ -	Dec-31
				$ 3,006 11,264 16,867 20,173 798 -
				$ 52,108
				$ 32,939 1,692
				$ 34,631

The above-mentioned deferred income tax liabilities were classified as other non-current liabilities.

E. Unrecognized deferred tax assets:

Unrecognized deferred tax assets:
ITEMS Items not recognized as deferred tax assets: Loss on investments accounted for using the equity method Loss on financial assets evaluation Unused operating loss carry forward	31-Dec-23 $ 39,092 969 72,151 $ 112,212	31-Dec-22
		$ - 969 -
		$ 969

• F.Information of unused loss carry forward:

As of December 31, 2023, operating loss carryforward as follows:

ExpiryYear 2033 G. The tax authorities have examined income tax return of .) Other Comprehensive Income (Loss) ITEM	Remaining CreditableAmount Taxeffect $ 760,753 $ 152,151 the Company through 2021. For the Year Ended December 31,2023 Before tax Income tax benefit After tax $ (3,736) $ - $ (3,736) (1,922) - (1,922) (1,862) - (1,862) (7,520) - (7,520)	Remaining CreditableAmount Taxeffect $ 760,753 $ 152,151 the Company through 2021. For the Year Ended December 31,2023 Before tax Income tax benefit After tax $ (3,736) $ - $ (3,736) (1,922) - (1,922) (1,862) - (1,862) (7,520) - (7,520)	Remaining CreditableAmount Taxeffect $ 760,753 $ 152,151 the Company through 2021. For the Year Ended December 31,2023 Before tax Income tax benefit After tax $ (3,736) $ - $ (3,736) (1,922) - (1,922) (1,862) - (1,862) (7,520) - (7,520)	Remaining CreditableAmount Taxeffect $ 760,753 $ 152,151 the Company through 2021. For the Year Ended December 31,2023 Before tax Income tax benefit After tax $ (3,736) $ - $ (3,736) (1,922) - (1,922) (1,862) - (1,862) (7,520) - (7,520)
		Before tax $ (3,736) (1,922) (1,862) (7,520)	Income tax benefit $ - - - -	After tax
Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit obligation Unrealized loss on equity instruments at fair value through other comprehensive income Share of other comprehensive income of associates accounted for using the equity method Unrealized loss on equity instruments at fair value through other comprehensive income Subtotal				$ (3,736) (1,922) (1,862)
				(7,520)

• (23.) Other Comprehensive Income (Loss)

• 41 -

		For the Year Ended	For the Year Ended	For the Year Ended	December	December	December	31,	2023
				Income tax
ITEM	Before tax			benefit				After tax
Items that may be reclassified subsequently to profit or
loss:
Exchange differences arising on translation of foreign
operations		(15,045)			3,009				(12,036)
Share of other comprehensive income of associates
accounted for using the equity method
Exchange differences arising on translation of foreign
operations transferred to profit or loss			17			-				17
Subtotal		(15,028)			3,009				(12,019)
Other comprehensive income (loss)	$	(22,548)		$	3,009		$		(19,539)
		For the Year Ended			December			31,	2022
				Income tax
ITEM	Before tax			expense				After tax
Items that will not be reclassified subsequently to
profit or loss:
Remeasurement of defined benefit obligation	$		9,080	$		-	$		9,080
Unrealized loss on equity instruments at fair value
through other comprehensive income			(68)			-				(68)
Share of other comprehensive income of associates
accounted for using the equity method
Unrealized loss on equity instruments at fair value
through other comprehensive income		(3,274)				-			(3,274)
Subtotal			5,738			-			5,738
Items that may be reclassified subsequently to profit or
loss:
Exchange differences arising on translation of foreign
operations		13,919			(2,784)				11,135
Share of other comprehensive income of associates
accounted for using the equity method
Exchange differences arising on translation of foreign
operations transferred to profit or loss			18			-				18
Subtotal		13,937			(2,784)				11,153
Other comprehensive income (loss)	$	19,675		$	(2,784)		$		16,891
(24.) Earnings per Share
			For the Year Ended December						31
ITEM			2023				2022
Basic earnings per share:
Net income attributable to ordinary shareholders of the parent		$		375,170	$			224,644
Weighted average number of shares outstanding for the period
(in thousands)				167,722				167,722
Basic earnings per share, after tax (Unit: NT$ Per Share)		$		2.24	$				1.34
Diluted earnings per share:
Net income available to ordinary shareholders of the parent		$		375,170	$			224,644

• 42 -

For the Year Ended December 31

ITEM Weighted average number of shares outstanding for the period (in thousands) Effect of the dilutive potential ordinary shares Employees’ compensation (share in thousands) Weighted average number of shares outstanding for diluted earnings per share (share in thousand) Diluted earnings per share, after tax (in dollars)	2023 167,722 309 168,031 $ 2.23	2022
		167,722 291
		168,013
		$ 1.34

If the Company offered to settle the compensation or bonuses paid to employees in shares or cash at the Company’s option, the Company assumed that the entire amount of the compensation or bonuses will be settled in shares, and the resulting potential shares are included in the weighted average number of shares outstanding used in the calculation of diluted earnings per share if the effect is dilutive. Such dilutive effect of the potential shares is included in the calculation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

7. TRANSACTIONS WITH RELATED PARTIES

A. Name of the parent company and the ultimate controlling party

The Company is the ultimate controlling party.

B. Names of related parties and relationship categories

Names of related parties Related party categories SynCore Biotechnology Co., Ltd. Subsidiaries ZuniMed Biotech Co., Ltd. Subsidiaries CANCAP PHARMACEUTICAL LTD. Subsidiaries Sinphar Tian-Li Pharmaceutical Co., Ltd.(Hangzhou) Subsidiaries Board of Directors, General Manager and Vice General Key management personnel Manager CANADA BIOTECH Other related parties Shu Fei Yu Other related parties

• C. Significant transaction with related parties

• (A.) Revenue

Revenue
Related party category/Name Subsidiary/SynCore	FortheYear EndedDecember31
	2023 $ 4,744	2022
		$ 2,267

The prices of sales with related parties were not significantly different from those of sold to third parties, and the payment term is 30-90 days.

• (B.) Purchases of goods

Purchases of goods
Related party category/Name Subsidiaries ZuniMed Sinphar Tian-Li	For the Year Ended December31
	2023 $ 55,097 31,547 $ 86,644	2022
		$ 63,358 5,058
		$ 68,416

• 43 -

The prices of purchase and commission processing with related parties were not significantly different from those of purchased from third parties, and the payment term is 30-90 days.

• (C.) Lease arrangement-operating lease

The subsidiary, SynCore, leased buildings from the Company mainly for the use of office and laboratory with lease terms from August 1, 2017 to March 31, 2024. The rental price was determined in accordance with mutual agreement and the payment would be collected monthly. As of the year ended December 31, 2023 and 2022, the rental receivables were NT$1,954 thousand and NT$11,263 thousand, respectively. The rental incomes were NT$10,689 thousand and NT$13,356 thousand in 2023 and 2022, respectively.

(D.) Trademarks and royalties

Under an agreement with CANADA BIOTECH, CANADA BIOTECH, the Company owns the right to use its trademark under the condition which the Company pays 0.2%~0.8% of annual gross profit from merchandise sale as royalty each quarter, with the annual sum of payment not less than 36 thousand in Canadian currency. The Company paid the royalties amounted to NT$901 thousand and NT$890 thousand in 2023 and 2022 respectively. The payments were recognized as marketing expense.

• (E.) Others

• a. The Company collected the common general administration fee, research and development cost and other income from its related party in 2023 and 2022. The amounts were described as follows:

Related party category/Name Subsidiaries SynCore Others	For the Year Ended December31	For the Year Ended December31
	2023 $ 11,624 173 $ 11,797	2022
		$ 10,147 49
		$ 10,196

The Company entered a sales agency agreement with its Subsidiary, SynCore. The Company would charge a service fee based on the quantity of sales. The service income in 2023 and 2022 were NT$6,057 thousand and NT$5,064 thousand respectively; As of December 31, 2023 and 2022, the advance service incomes were amounted to NT$890 thousand and NT$534 thousand respectively; Deferred credit items as of December 31, 2022 were NT$1,304 thousand. They were recognized as other non-current liabilities.

• b. For the years ended December 31, 2023 and 2022, the Company paid its subsidiary, CANCAP, service fee amounted to NT$8,548 thousand and NT$8,113 thousand, respectively.

• c. The Company paid its subsidiaries various related operating expenses in 2023 and 2022. The amounts were described as follows:

described as follows:
Related party category/Name Subsidiaries SynCore	FortheYear EndedDecember31
	2023 $ 455	2022
		$ 601

• d. As of December 31, 2022, the Company paid its subsidiary, SynCore, a compensation for loss on raw material amounted to NT$413 thousand.

• e. The Company has successively acquired nearby agricultural land for the plant planning. However, under the current regulations, the ownership of agricultural lands could not be registered under the compnay. Therefore, the Company has appointed the other related party, Shu Fei Yu, to be the owner the land. Please refer to the property, plant and equipment session in Note 6(7.) for more information.

• 44 -

(F.) Receivables from / payables to related parties

Item Accounts receivable Other receivables Accounts payable Other payables	Relatedpartycategory/Name Subsidiary/SynCore Subsidiary/SynCore Subsidiary/ZuniMed Subsidiary/Sinphar Tian-Li Total Subsidiary/SynCore Subsidiary/ZuniMed Total	31-Dec-23 $ - $ 438 $ 7,063 19,972 $ 27,035 $ - 268 $ 268	31-Dec-22
			$ 7
			$ 328
			$ 9,178 315
			$ 9,493
			$ 434 -
			$ 434

The above-mentioned other receivable was recognized as other current asset.

No endorsement or guarantee was obtained for outstanding receivables from and payables to related parties and no loss allowances were recognized for receivables from related parties for 2023 and 2022.

• (G.) Endorsements/guarantees obtain

Endorsements/guarantees obtain
Relatedpartycategory/Name Subsidiary/ZuniMed Relatedpartycategory/Name Subsidiary/ZuniMed	31-Dec-23
	Endorsement/Guarantee received Used Balance $ 25,000 $ 25,000 31-Dec-22		Unused Balance
			$ -
	Endorsement/Guarantee received $ 25,000	Used Balance $ 25,000	Unused Balance
			$ -

The above is a supply guarantee of the medical institution.

• (H.) Endorsements/Guarantees provide

Endorsements/Guarantees provide
Related Party Categories Subsidiary/SynCore Subsidiary/ZuniMed Related PartyCategories Subsidiary/SynCore Subsidiary/ZuniMed	31-Dec-23
	Endorsement/Guarantee provided Used Balance $ 250,000 $ - 30,000 8,000 $ 280,000 $ 8,000 31-Dec-22		Unused Balance
			$ 250,000 22,000
			$ 272,000
	Endorsement/Guarantee provided $ 350,000 30,000 $ 380,000	Used Balance $ 30,000 5,000 $ 35,000	Unused Balance
			$ 320,000 25,000
			$ 345,000

D. Compensation of key management personnel

The remuneration to the Board of Directors and main management personnel were as follows:

ITEM Salaries and other short-term employee benefits	For the Year Ended December31	For the Year Ended December31
	2023 $ 29,109	2022
		$ 26,373

Please refer to the shareholder meeting’s annual report for the information about the above-mentioned remuneration to board of directors and the main management personnel.

• 45 -

8. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The Company’s assets pledged as collateral for long-term loans are as follows:

The Company’s assets pledged as collateral for long-term	loans are as follows:
ITEM Property, plant and equipment Investment properties Intangible assets Total	31-Dec-23 $ 1,255,495 111,388 4,919 $ 1,371,802	31-Dec-22
		$ 1,161,084 237,961 6,559
		$ 1,405,604

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

As of December 31, 2023, Capital expenditures committed but not yet incurred are as follows:

ITEM Property, plant and equipment	31-Dec-2023 $ 90,520	31-Dec-2022
		$ 58,363

10. SIGNIFICANT LOSSES FROM DISASTERS: None.

1. SIGNIFICANT EVENTS AFTER REPORTING PERIOD: None.

12. OTHER INFORMATION

(1.) CAPITAL MANAGEMENT

The Company requires significant amount of capital to maintain its research and development expenditure. Accordingly, the Company manages its capital to ensure that it has sufficient and necessary financial resources and plans to fund its working capital needs, capital asset purchase, research and development expenditure, debt service requirement and dividend payments associated with its existing operations over the next 12 months.

• (2.) FINANCIAL INSTRUMENTS

• A. Financial Risk of financial instrument.

FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company's risk management objectives are to manage the market risk (including foreign currency risk, interest risk and price risk), credit risk and liquidity risk related to its operating activities. The Company identifies, measures and manages the aforementioned risks and mitigates the disadvantage impact on financial performance. The material treasury activities are reviewed by Audit Committees and/or Board of Directors in accordance with procedures required by relevant regulations or internal controls. During the implementation of such plans, Corporate Treasury function must comply with certain treasury procedures that provide guiding principles for overall financial risk management and segregation of duties.

NATURE AND EXTENT OF SIGNIFICANT FINANCIAL RISKS

(A)Market risk

a. Foreign currency risk

• (a.) The Company is exposed to the foreign currency risk due to the transaction of sales, purchase and cash denominated in foreign currency other than the Company’s functional currency. These non-functional currencies are USD, RMB, JPY and HKD.

• 46 -

(b.) Foreign currency exposure and sensitivity analysis

Financial assets Monetaryitems USD：NT$ CNY：NT$ JPY：NT$ HKD：NT$ Financial liabilities Monetaryitems USD：NT$ CNY：NT$			31-Dec-23	31-Dec-23	31-Dec-23	31-Dec-23
	Foreign Currencies (In Thousands) $ 5,545 1,070 44,705 119 $ 280 4,616	Exchange Rate 30.7050 4.3270 0.2172 3.9290 30.7050 4.3270	Carrying Amount (In Thousands) $ 170,269 4,630 9,710 466 $ 8,588 19,972	Sensitivityanalysis
				Extent of variation 1% 1% 1% 1% 1% 1%	Impact on Profit or loss $ 1,703 46 97 5 $ 86 200	Impact on Equity
						$ - - - - $ - -

Financial assets Monetaryitems USD：NT$ CNY：NT$ HKD：NT$ JPY：NT$ Financial liabilities Monetaryitems USD：NT$			31-Dec-22	31-Dec-22	31-Dec-22	31-Dec-22
	Foreign Currencies (In Thousands) $ 4,225 1,074 118 64,992 $ 603	Exchange Rate 30.7100 4.4080 3.9380 0.2324 30.7100	Carrying Amount (In Thousands) $ 129,751 4,736 465 15,104 $ 18,522	Sensitivityanalysis
				Extent of variation 1% 1% 1% 1% 1%	Impact on Profit or loss $ 1,298 47 5 151 $ 185	Impact on Equity
						$ - - - - $ -

If New Taiwan dollar strengthened against the relevant currency and all other variables were held constant, there would be an equal and opposite impact on profit or loss and other equity as of December 31, 2023, and December 31, 2022.

• (c.) Since there were varieties of foreign currencies within the Company, the Company disclosed the summarized foreign exchange gains (losses) information of monetary items. The realized and unrealized foreign exchange gains (losses) were NT$ (3,530) thousand and NT$ 15,314 thousand for the year ended December 31, 2023 and 2022, respectively.

• (d.) The unrealized exchange gains (losses) of fluctuation risk on foreign currency monetary item is significant. The unrealized foreign exchange gains (losses) were NT$ (765) thousand and NT$ 240 thousand for the year ended December 31, 2023 and 2022, respectively.

b. Price risk

The Company is exposed to price risk primarily related to its investment in instruments classified as financial assets at FVTPL and financial assets at FVTOCI.

• 47 -

The Company primarily invested in the unlisted stocks. The instruments prices are affected by the uncertainties of the investment targets’ future value.

Assuming a hypothetical increase/decrease of 1% in prices of the equity instruments at the end of the reporting period, the net loss for the years ended December 31, 2023 and 2022 would have increased/decreased by NT$ 24 thousand and NT$ 12 thousand, respectively, as they were classified as financial assets at FVTPL; the other comprehensive income for the years ended December 31, 2023 and 2022 would have increased/decreased by NT$ 101 thousand and NT$ 96 thousand, respectively, as they were classified as financial assets at FVTOCI.

Assuming a hypothetical increase/decrease of 1% in prices of the beneficiary certificate at the end of the reporting period

c. Interest rate risk

The carrying amounts of the Company’s financial assets and financial liabilities exposed to interest rate risk were as follows:

rate risk were as follows:
Item Fair value interest rate risk Financial assets Financial liabilities Net Cash flow interest rate risk Financial assets Financial liabilities Net	CarryingAmount 31-Dec-23 31-Dec-22 $ 148,480 $ 86,664 - (317) $ 148,480$ 86,347 $ 548,724 $ 613,469 (1,894,963) (1,812,935) $ (1,346,239) $ (1,199,466)
	31-Dec-23 $ 148,480 - $ 148,480 $ 548,724 (1,894,963) $ (1,346,239)

• (a.) Sensitivity analysis: Fair value interest rate risk

The Company did not designate any fixed interest rate financial instruments as fair value through profit or loss and derivatives instruments (interest rate swaps) to hedge its exposures to changes in fair values. As such, changes in interest rate would not affect the net income and the other comprehensive income at the end of the reporting period.

• (b.) Sensitivity analysis: Cash flow interest rate risk

The Company’s financial instruments at floating interest rate were assets (liabilities) at floating interest rate. Therefore, changes in interest rate would affect the future cash flows. Assuming a hypothetical increase/decrease 1% in interest rates, the net income for the years ended December 31, 2023 and 2022 would increase/decrease by NT$ 13,462 thousand and NT$ 11,995 thousand, respectively.

(B) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial losses to the Company. The Company is exposed to credit risk from operating activities, primarily from account receivables, and from investing activities, primarily from bank deposits, fixed-income investments and other financial instruments. The Company managed the credit risk separately for business related and financial related risk.

• 48 -

a. Business related credit risk:

To maintain the quality of account receivable, the Company has established related credit risk management procedure. The risk assessment of individual customer includes evaluating financial position, internal evaluation, historical trading records and economic circumstance which could affect the payment ability of the customer. The Company may choose to strengthen overall risk management including collection in advance or guarantee provided by customers to mitigate the credit risk of certain customers.

b. Financial credit risk:

The financial department of the Company regularly monitors and reviews the credit risk of bank deposit and other financial instruments. The Company mitigates its exposure by selecting counterparties (banks, financial institutions, Company organizations and government authorities) with well credit and investment-grade credit ratings. The credit risk is insignificant. The Company has no debt instrument classified as financial assets measured at amortized cost and financial assse at FVTOCI.

• (a.) Concentration of credit risk

As of December 31, 2023, and December 31, 2022, accounts receivable from the top 10 customers represent 21.28%, and 24.51% of total accounts receivables of the Company, respectively. The Company believes the concentration risk is insignificant for the remaining accounts receivable.

• (b.) Expected credit impairment losses measurement

  • Accounts receivable : Simplified approach, please refer to Note 6(3.).

  • Judgment on whether credit risk increasing significantly:None.

• (C) Liquidity risk

• a. Liquidity risk management

The Company’s objective of managing liquidity risk is to maintain sufficient cash and cash equivalents required for operations, high liquidity securities, and bank financing lines for operations, and to ensure that the Company has sufficient financial flexibility.

• b. Maturity analysis of financial liabilities

Non-derivative financial liabilities Short-term loans Accounts payable Other payables Long-term borrowing, including current portion Total Non-derivative financial liabilities Short-term loans Accounts payable Other payables Long-term borrowing, including current portion Total				31-Dec-23
	Less than 6 Months $ 180,000 302,196 117,798 24,245 $ 624,239	6－12 Months $ 180,000 - 31,628 24,245 $ 235,873	1－2 Years $ - - - 1,408,491 $ 1,408,491	2－5 Years $ - - - 77,982 $ 77,982 31-Dec-22	Over 5 Years $ - - - - $ -	Contractual Cash flows $ 360,000 302,196 149,426 1,534,963 $ 2,346,585	Carrying Amount
							$ 360,000 302,196 149,426 1,534,963
							$ 2,346,585
	Less than 6 Months $ 360,000 313,721 127,905 24,058 $ 825,684	6－12 Months $ - - 23,032 24,058 $ 47,090	1－2 Years $ - - - 988,115 $ 988,115	2－5 Years $ - - - 410,093 $ 410,093	Over 5 Years $ - - - 6,611 $ 6,611	Contractual Cash flows $ 360,000 313,721 150,937 1,452,935 $ 2,277,593	Carrying Amount
							$ 360,000 313,721 150,937 1,452,935
							$ 2,277,593

• 49 -

The Company doesn’t expect the timing of occurrence of the cash flows estimated through the maturity date analysis will be significantly earlier, nor expect the actual cash flow amount will be significantly different.

B. Categories of financial instruments

The following is the carrying amounts of the financial assets and financial liabilities of the Company at December 31, 2023 and December 31, 2022.

Financial assets Financial assets measured at amortized cost Cash and cash equivalents Notes and accounts receivable (including related parties) Refundable deposits Financial assets at FVTPL – non-current Financial assets at FVTOCI－non-current Financial liabilities Financial liabilities measured at amortized cost Short-term loans Net, accounts payable (including related parties) Other payable (including related parties) Long-term loans (including the current portion)	31-Dec-23 $ 700,998 589,902 24,736 2,394 10,136 360,000 302,196 149,426 1,534,963	31-Dec-22 $ 703,055 635,411 17,830 1,219 9,608 360,000 313,721 150,937 1,452,935

• (3.) Fair value information

• A. Details of the fair values of the Company’s financial assets and financial liabilities not measured at fair value and investment property measured at cost are provided in Note 12. (3)B and Note 6.(8), respectively.

Level 1

Fair value measurements of the Level 1 are those derived from quoted prices in active markets for identical financial instruments. An active market is a market in which transactions for identical instrument take place with sufficient frequency and volume to provide public pricing information on an ongoing basis.

Level 2

Fair value measurements are those derived from inputs other than quoted prices included within Level 1 that observable for the instrument, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3

Fair value measurements are those derived from valuation techniques that include inputs for instrument that are not based on observable market data. The Company invested in equity investments without active market included within level 3.

B. Financial instruments that are not measured at fair value

The Company considers the carrying amounts of financial instruments that are not measured at fair value, such

as cash and cash equivalents, notes and accounts receivables, refundable deposits, accounts payable, approximate their fair values.

• C. Fair value hierarchy information

The Company’s financial instruments measured at fair value were under a recurring basis.

• 50 -

The following table presents the Company’s financial instruments measured at fair value on a recurring basis:

Items Asset: Fair value on a recurringbasis Financial assets measured at FVTPL Foreign unlisted publicly traded preference share Financial assets at FVTOCI Domestic unlisted ordinary shares Items Asset: Fair value on a recurringbasis Financial assets measured at FVTPL Foreign unlisted publicly traded preference share Financial assets at FVTOCI Domestic unlisted ordinary shares		31-Dec-23	31-Dec-23
	Level 1 $ - $ -	Level 2 Level3 $ -$ 2,394 $ - $ 10,136 31-Dec-22		Total
				$ 2,394
				$ 10,136
	Level 1 $ - $ -	Level 2 $ - $ -	Level3 $ 1,219 $ 9,608	Total
				$ 1,219
				$ 9,608

• D. Valuation techniques and assumptions used in fair value measurement

• (A.) If there is an active market for the financial instruments, the fair value of the financial instruments is measured by using the quoted market prices. The quoted market prices announced by the main market place and the prices of government bonds classified as popular securities announced by Taipei Exchange (TPEx) are deemed as fair value foundation of publicly traded equity instruments and debt instruments with an active market.

If there are timely and frequent quoted prices from the exchange market, the broker, the dealer, industry association, price service organization, or the administrative, and the prices represent actual, frequent, and fair trades, the financial instruments are deemed as with an active market. Otherwise, the market is deemed as not active. In general, huge price gap, price gap apparently expanding, and small trading volume were indicators of a not active market.

• (B.) Except for the aforementioned financial instruments with active market, the fair value of other financial instruments is measured by valuation technique or quotation of counterparties. The fair value from valuation technique could refer to the fair value of other financial instruments with similar substantial conditions and characteristics, discounted cash flow method and other valuation technique including model with observable market information on balance sheet date (e.g. yield curve of TPEx, quoted interest rate of Reuters commercial Note).

The fair values of non-listed equity investments were Level 3 fair value assets, and determined using the market approach by reference the peer companies valuation, third party quotation, net value and operation status. The significant unobservable input used was discount for lack of marketability. A movement in discount for the lack of marketability would not result in significant changes in the fair values.

• 51 -

• (C.) The Company considered the credit risk evaluation adjustment for financial instruments and non-financial instruments to reflect the credit risk of the counterparty and the credit quality of the Company.

• (D.) Valuation techniques used in Level 3 fair value Measurement:

The evaluation procedure of the financial instruments belong to Level 3 is verified by the financial department of the Company through verifying the independent source inputs to make sure the evaluation results closing to the market status. To make sure the reasonability of the evaluation results, the financial department verify the independence and reliability of source data, test and renew the input data, model and other necessary inputs.

  - (E.) There were no transfers between different fair value hierarchy for the years ended December 31, 2023 and 2022, respectively.

1. SEPARATELY DISCLOSED ITEMS

2. (1.) Information about significant transactions:

   • A. Financing provided to others: None;

   • B. Endorsements/guarantees provided: Table 1 attached

   • C. Marketable securities held (excluding investment in subsidiaries, associates and joint ventures): Please see Table 2 attached;

   • D. Marketable securities acquired and disposed at costs or prices at least NT$300 million or 20% of the paid-in capital: None;

   • E. Acquisition of individual real estate properties at costs of at least NT $300 million or 20% of the paid-in capital: None;

   • F. Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital: None;

   • G. Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital: None;

   • H. Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital: None;

   • I. Trading in derivative instruments: None;

3. (2.) Related Information of investees: Please see Table 3 attached;

4. (3.) Information on investments in Mainland China: Please see Table 4 attached and Table 3 attached;

   • A. The name of the investee in mainland China, the main businesses and products, its issued capital, method of investment, information on inflow or outflow of capital, percentage of ownership, income (losses) of the investee, share of profits/losses of investee, ending balance, amount received as dividends from the investee, and the limitation on investee: See Table 4 attached.

   • B. Significant direct or indirect transactions with the investee, its prices and terms of payment, unrealized gain or loss, and other related information which is helpful to understand the impact of investment in mainland China on financial reports: See Note 7 & Table 3 attached.

5. (4.) Information of major shareholder (list of all shareholders with ownership 5% or greater showing the names and the number of shares and percentage of ownership held by each shareholder): Please see Table 5 attached.

14. SEGMENT INFORMATION

Please refer to the consolidated financial statements of Sinphar Pharmaceutical Co., Ltd. and subsidiaries for operating segment information.

• 52 -

Sinphar Pharmaceutical Co., Ltd. and Subsidiaries

TABLE 1

Endorsements/Guarantees provided

For the Year Ended December 31, 2023

(Amounts in thousands of New Taiwan Dollars, Unless Specified Otherwise)

		Guaranteed Party	Guaranteed Party	Limits on
				Endorsement/				Amount of	Ratio of	Maximum			Guarantee
No. (Note 1)	Endorsement / Guarantee Provider	Name	Nature of relationship (Note 2)	Guarantee Amount Provided to Each Guaranteed Party (Note 3)	Maximum Balance for the Period	Ending Balance	Amount Actually Drawn	Endorsement/ Guarantee Collateralized by Properties	Accumulated Endorsement/ Guarantee to Net Equity per Latest Financial Statements	Endorsement/ Guarantee Amount Allowable (Note 4)	Guarantee Provided by Parent Company	Guarantee Provided by A Subsidiary	Provided to Subsidiaries in Mainland China
0	Sinphar Pharmaceutical Co.,Ltd.	ZuniMed Biotech Co., Ltd.	1	$ 1,239,335	$ 30,000	$ 30,000	$ 8,000	$ -	0.97%	$ 1,549,169	Y	－	－
0	Sinphar Pharmaceutical Co.,Ltd.	SynCore Biotechnology Co.,Ltd.	1	$ 1,239,335	$ 350,000	$ 250,000	$ -	$ -	8.07%	$ 1,549,169	Y	－	－
1	ZuniMed Biotech Co., Ltd.	Sinphar Pharmaceutical Co.,Ltd	2	$ 37,867	$ 25,000	$ 25,000	$ 25,000 (Note 5)	$ -	26.41%	$ 47,333	－	Y	－

Note 1 ： (1) The issuer fills in “0”. (2) The subsidiaries are numbered in order starting from “1”.

Note 2 ： (1) The endorser/guarantor parent company owns directly and indirectly more the 50% voting shares of the endorsed/guaranteed subsidiary.

(2) The endorsed/guaranteed company owns directly and indirectly more the 50% voting shares of the endorser/guarantor parent company. Note 3 ： Maximum endorsement/guarantee amount allowable is 40% of the net worth of the Endorsement/Guarantee Provider. Note 4 ： Maximum endorsement/guarantee amount allowable is 50% of the net worth of the Endorsement/Guarantee Provider. Note 5 ： It is a supply guarantee for the medical institution.

• 53 -

TABLE 2

Sinphar Pharmaceutical Co., Ltd. and Subsidiaries TABLE 2

Marketable Securities Held (Excluding Subsidiaries, Associate and Joint Venture)

As of December 31, 2023

(Amounts in thousands of New Taiwan Dollars, Unless Specified Otherwise)

Held Company Name	Marketable Securities Type and Name	Relationship with Sinphar	Financial Statement Account	December 31,2023	December 31,2023	December 31,2023	December 31,2023	Note
				Shares/Units	Carrying Value	Percentage of Ownership	Fair Value
Sinphar Pharmaceutical Co., Ltd.	PHYTOCEUTICA INC.(preferred share)	Investee	Financial assets at fair value throughprofit or loss(Non-Current)	90,362.00	$ -	-	$ -	-
Sinphar Pharmaceutical Co., Ltd.	Datun Entertainment Development Co.,Ltd.	－	Financial assets at fair value through other comprehensive income(Non-Current)	5.00	10,136	0.42%	10,136	-
SynCore Biotechnology Co., Ltd.	Fuh Hwa Money Market	－	Financial assets at fair value throughprofit or loss(Current)	252,743.00	3,617	-	3,738	-
SynCore Biotechnology Co., Ltd.	Fuh Hwa You Li Money Market	－	Financial assets at fair value throughprofit or loss(Current)	152,110.90	2,031	-	2,101	-
SynCore Biotechnology Co., Ltd.	JPMorgan（Taiwan）Glbl Fd of Bd Fds Inc	－	Financial assets at fair value throughprofit or loss(Current)	90,062.20	1,012	-	1,041	-
SynCore Biotechnology Co., Ltd.	MacuCLEAR, INC. (Preferred Share)	－	Financial assets at fair value through other comprehensive income(Non-Current)	95,160.00	-	0.95%	-	-
SynCore Biotechnology Co., Ltd.	Medigene (Common Share)	－	Financial assets at fair value through other comprehensive income(Non-Current)	224,934.00	12,076	0.92%	12,076	-

• 54 -

TABLE 3

Sinphar Pharmaceutical Co., Ltd. and Subsidiaries TABLE 3

Name, Location, and Related Information of Investees Over Which Sinphar Exercise Significant Influence (Excluding Information On Investment In Mainland China) as of December 31, 2023

(Amounts in Thousands of New Taiwan Dollars, Unless Specified Otherwise)

				Original Investment Amount	Original Investment Amount	Balance as of December 31, 2023	Balance as of December 31, 2023	Balance as of December 31, 2023	Net Income
Investor Company	Investee Company	Location	Main Businesses and Products	December	December	Shares	Percentage of	Carrying	(Losses) of the	Share of Profits / Losses of Investee	Notes
				31, 2023	31, 2022		Ownership	Value	Investee
Sinphar Pharmaceutical Co., Ltd.	CANCAP PHARMACEUTICAL LTD.(Ordinary shares)	Canada	Production and sale of healthy food	$ 44,605	$ 44,605	2,140,000	88.43%	$ -	$ 1,139	$ 1,139	Subsidiary
Sinphar Pharmaceutical Co., Ltd.	CANCAP PHARMACEUTICAL LTD.(Preference shares)	Canada	Production and sale of healthy food	126,247	126,247	51,500	100.00%	2,394	1,139	-	Subsidiary
Sinphar Pharmaceutical Co.,Ltd.	SUNETIC BIOTECH INC.	Mauritius	Investment business	745,748	745,748	18,854,534	83.47%	815,584	9,648	(13,146)	Subsidiary
Sinphar Pharmaceutical Co.,Ltd.	UNIVERSAL NEXT TECHNOLOGIES INC.	British Virgin Islands	Investment business	17,467	17,467	503,845	100.00%	27	(12)	(12)	Subsidiary
Sinphar Pharmaceutical Co.,Ltd.	ZuniMed Biotech Co., Ltd.	Taiwan	Production and sale of medical appliances	109,990	109,990	10,300,000	100.00%	91,199	(1,139)	(461)	Subsidiary
Sinphar Pharmaceutical Co.,Ltd.	SynCore Biotechnology Co., Ltd.	Taiwan	Biotechnology service	1,864,935	1,745,698	22,597,472	64.26%	229,301	(38,172)	(22,709)	Subsidiary
SynCore Biotechnology Co., Ltd.	SynCore Biotechnology Europe GmbH	Germany	New drugs development and biotechnology service	834	834	25,000	100.00%	737	18	18	Subsidiary

Note1：The shares of profits/losses of investee were calculated based on the financial statements audited by the CPAs. The effect of realized (unrealized) gains and losses have already been considered.

Note2：SynCore Biotechnology Co., Ltd. reduced capital in May, 2023, and the shares held by the Company decreased from 71,456,000 shares to 19,090,513 shares.

Note3：SynCore Biotechnology Co., Ltd. increase capital in October, 2023, and the shares held by the Company increased from 19,090,513 shares to 22,597,472 shares.

• 55 -

TABLE 4

Sinphar Pharmaceutical Co., Ltd. and Subsidiaries TABLE 4

INFORMATION ON INVESTMENT IN MAINLAND CHINA

FOR THE YEAR ENDED DECEMBER 31, 2023

(Amounts in Thousands of New Taiwan Dollars, Unless Specified Otherwise)

Investee Company	Main Businesses and Products	Main Businesses and Products	Total Amount of Paid-in Capital (RMB in Thousands)	Method of Investment	Method of Investment	Accumulated Outflow of Investment from Taiwan as of January 1, 2023	Investment Flows	Investment Flows	Accumulated Outflow of Investment from Taiwan as of December 31,2023	Net Income (Losses) of Investee Company	Percentage of Ownership	Shares of Profits/Losses (note 1)	Carrying Amount as of December 31, 2023	Accumulated Inward Remittance of Earnings as of December 31,2023
							Outflow	Inflow
Sinphar Tian-Li Pharmaceutical Co., Ltd.(Hangzhou)	Production and sales of raw materials, pharmaceuticals		RMB 193,005	Indirect investment in mainland China by SUNETIC BIOTECH INC., an 83.47% owned subsidiary of Sinphar		$ 645,635 (USD 19,786 thousand)	-	-	$ 645,635 (USD 19,786 thousand)	$ 18,987	83.47%	$ (5,350)	$ 840,728	$ 179,317
Hetian Tianli shasheng Pharmaceutical Development Co., Ltd.	Scientific research and production and sales of shasheng Pharmaceutical		RMB 10,000	Indirect investment in mainland China by Sinphar Tian-Li Pharmaceutical Co., Ltd.(Hangzhou), a sub-subsidiary company of which Sinphar holds 83.47% of the total shares		-	-	-	-	(7,326)	75.96%	(2,673)	83,388	-
Hangzhou Vitrum Healthy Food Co., Ltd.	Sale of healthy food		RMB 30,000	Indirect investment in mainland China by Sinphar Tian-Li Pharmaceutical Co., Ltd.(Hangzhou) a sub-subsidiary company of which Sinphar holds 83.47% of the total shares.		-	-	-	-	(306)	83.47%	(255)	1,526	-
							Upper Limit on Investment (Note 3) 1,859,002
		Accumulated Investment in Mainland China as of December 31, 2023 (US$in Thousands)			Investment Amounts Authorized by Investment Commission, MOEA (US$ in Thousands)		Upper Limit on Investment (Note 3)
		652,200 (USD 19,986(Note 2))			777,487 (USD 25,321)		1,859,002

Note 1 ： The shares profits/losses of investee were calculated based on the financial statements audited by the R.O.C. CPAs of the parent company.

Note 2 ： The amount included the indirect investment of UNIVERSAL NEXT TECHOLOGY INC to Qinghai Mingxing Bio-Engineering Co., amounting to USD$ 200 thousand, which has already been cancelled by the Investment Board. Note 3 ： According to the regulations of the Investment Commission of the Ministry of Economic Affairs, the upper limit of the cumulative amount of its investment in the mainland is 60% of the net value.

• 56 -

Sinphar Pharmaceutical Co., Ltd.

TABLE 5

Information of major shareholders

December 31, 2023

Shareholders	Shares	Shares
	Total shares owned (In thousands)	Ownership Percentage
XING-DA CAPITAL CORP.	15,679	9.34%

Note: The main shareholder information in this table is calculated by Taiwan Depository & Clearing Corporation, using total number of ordinary shares and preferred shares held by the shareholders who have completed Sinphar’s dematerialized securities registration and delivery (including treasury shares) is more than 5% on the last business day at the end of each quarter. As for the difference between capital stock recorded in Sinphar's financial report and the number of shares which Sinphar actually have completed the dematerialized securities registration and delivery, may result from computation basis.

• 57 -

Sinphar Pharmaceutical Co., Ltd. STATEMENT OF CASH AND CASH EQUIVALENTS DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars and Foreign Currencies in Dollars

Item Cash Bank deposits	Description Petty cash and cash on hand Check deposits Demand deposits: Chang Hwa Commercial Bank, Ltd. Tatung Branch First Commercial Bank Su’ao Branch Taiwan Business Bank Co., Ltd. Su’ao Branch Bank of Taiwan Lou Tung Branch Mega International Commercial Bank Co., Ltd. Yilan Branch Taishin International Bank Co., Ltd. Offshore Banking Branch E.SUN Commercial Bank, Ltd. Chungshiaw Branch Chang Hwa Commercial Bank, Ltd. Hsi-Sung Branch Taiwan Cooperative Bank Bei Luodong Branch Chunglun Branch Taiwan Cooperative Bank Bei Luodong Branch Land Bank of Taiwan Hsinyi Branch others Foreign currency deposits: Mega International Commercial Bank Co., Ltd. Yilan Branch (JPY$ 43,831,177.00 Exchange rate:0.2172) Chang Hwa Commercial Bank, Ltd. Tatung Branch (USD$ 260,162.54 Exchange rate:30.7050) Mega International Commercial Bank Co., Ltd. Yilan Branch (USD$ 81,369.34 Exchange rate:30.7050) others Time deposits: Taiwan Cooperative Bank Bei Luodong Branch (USD$ 1,450,000.00 Interest rate:5.15%~5.20% Exchange rate:30.7050) Mega International Commercial Bank Co., Ltd. Yilan Branch (USD$ 1,250,000.00 Interest rate: 5.20% Exchange rate:30.7050) Chang Hwa Commercial Bank, Ltd. Tatung Branch (USD$ 1,021,267.50 Interest rate: 5.20% Exchange rate:30.7050) Taiwan Business Bank Co., Ltd. Su’ao Branch (USD$ 1,000,000.00 Interest rate:5.30% Exchange rate:30.7050) Taiwan Business Bank Co., Ltd. Su’ao Branch (CNY$ 600,000.00 Interest rate:2.00% Exchange rate:4.3270) Mega International Commercial Bank Co., Ltd. Yilan Branch (CNY$ 211,950.18 Interest rate:2.20%~2.60% Exchange rate:4.3270)		Amount
		$	1,962
			1,832
			201,918 111,034 66,545 22,093 20,942 20,173 15,866 15,094 14,017 10,888 10,200 15,998
			524,768
			9,520 7,988 2,499 3,949
			23,956
			44,523 38,381 31,358 30,705 2,596 917
			148,480
		$	700,998

• 58 -

Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF NOTES RECEIVABLE

DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars

Client Name Third Parties: Others(The amount of individual clients in others does not exceed 5% of this account balance) Less：Loss allowance Net	Description Payments	Amount $ 164,407 (507) $ 163,900	Note
			-

• 59 -

Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF ACCOUNTS RECEIVABLE

DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars

Client Name Third Parties: Watson''s Personal Care Stores(Taiwan) Co., Limited. Others(The amount of individual clients in others does not exceed 5% of this account balance) Less：Loss allowance Net	Description Payments Payments	Amount $ 32,458 400,803 433,261 (7,259) $ 426,002	Note
			- -

• 60 -

Sinphar Pharmaceutical Co., Ltd. STATEMENT OF INVENTORIES

DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars

Item Raw materials Materials Materials and supplies in transit Work in process Finished goods Merchandise Less：Allowance for loss Net	Description Western medicine raw materials, natural raw materials, etc. Empty capsules, medicine bottles and instructions, etc. Western medicine raw materials, natural raw materials, etc. Pharmaceuticals in progress, etc. Medicines, health food, etc. Health food	Amount Cost Net Realizable Value $ 331,982 $ 317,550 49,304 65,835 3,459 3,459 74,607 71,551 299,833 554,592 2,910 7,636 762,095 (56,321) $ 705,774	Note
		Cost $ 331,982 49,304 3,459 74,607 299,833 2,910 762,095 (56,321) $ 705,774
			- - - - - -

• 61 -

Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF NON-CURRENT FINANCIAL ASSETS AT FAIR VALUE THROUGHT PROFIT OR LOSS FOR THE YEAR ENDED DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars; Shares / Units

Name of financial instruments	As of January 1, 2023 Shares Amount	As of January 1, 2023 Shares Amount	As of January 1, 2023 Shares Amount	Shares	Additions Amount	Additions Amount	Additions Amount	Shares	Decrease	Decrease	Amount		As of December Shares	As of December Shares	31, 2023 Amount	Collateral	Note
CANCAP
PHARMACEUTICAL LTD. (preferred share)	51,500	$	1,219		-	$	1,175		-	$		-	51,500	$	2,394	-	-
PHYTOCEUTICA INC.(preferred share)	90,362		4,844		-		-		-			-	90,362		4,844	-	-
			6,063				1,175					-			7,238
Less: Accumulated Impairment			(4,844)				-					-			(4,844)
Total		$	1,219			$	1,175			$		-		$	2,394

Note: The increase of NT$1,175 thousand in the current period is due to the operating loss of the invested company CANCAP PHARMACEUTICAL LTD., which is evaluated by the equity method, resulting in a credit balance of book value of the long-term equity investment. The amount of NT$123,853 thousand, which is recognized as a credit amount by the equity method, was taken as a deduction of “Financial Assets measured at Fair Value through Profit or Loss”, and the remaining book value NT$1,175 thousand taken as the increase in the current period.

• 62 -

Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF NON-CURRENT FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED DECEMBER 31, 2023

Name of financial instruments Datun Entertainment Development Co., Ltd. (ordinary shares) Less: Valuation adjustments Total	As of January 1, 2023 Shares Amount 4 $ 9,676 (68) $ 9,608	Additions Shares Amount 1 $ 2,450 (1,922) $ 528	Amounts in Thousands of New Taiwan Dollars; Shares / Units Decrease As of December 31, 2023 Collateral Note Shares Amount Shares Amount - $ - 5 $ 12,126 - - - (1,990) $ - $ 10,136	Amounts in Thousands of New Taiwan Dollars; Shares / Units Decrease As of December 31, 2023 Collateral Note Shares Amount Shares Amount - $ - 5 $ 12,126 - - - (1,990) $ - $ 10,136
	Shares 4	Shares 1	Shares -
				-

• 63 -

Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD FOR THE YEAR ENDED DECEMBER 31, 2023

Name of financial instruments	As of January1,2023	As of January1,2023	Additions	Additions	Decrease	Decrease	Share of profit(loss)	Cumulative translation difference	Unrealized Loss on Financial Assets at Fair Value Through Other Comprehensive Income	As	Amounts in Thousands of New Taiwan Dollars; Shares / Units Percentage of Ownership 88.43% $ (123,853) $ - $ (109,233) - Note 1 83.47% 815,584 - 842,572 - Note 2 100.00% 27 - 27 - - 100.00% 91,199 - 94,668 - - 64.26% 229,301 - 229,834 - Note 3 1,012,258 $ 1,057,868 123,853 $ 1,136,111 Collateral Note Amount Unitprice Market price or net equity value Total of December 31,2023	Amounts in Thousands of New Taiwan Dollars; Shares / Units Percentage of Ownership 88.43% $ (123,853) $ - $ (109,233) - Note 1 83.47% 815,584 - 842,572 - Note 2 100.00% 27 - 27 - - 100.00% 91,199 - 94,668 - - 64.26% 229,301 - 229,834 - Note 3 1,012,258 $ 1,057,868 123,853 $ 1,136,111 Collateral Note Amount Unitprice Market price or net equity value Total of December 31,2023	Amounts in Thousands of New Taiwan Dollars; Shares / Units Percentage of Ownership 88.43% $ (123,853) $ - $ (109,233) - Note 1 83.47% 815,584 - 842,572 - Note 2 100.00% 27 - 27 - - 100.00% 91,199 - 94,668 - - 64.26% 229,301 - 229,834 - Note 3 1,012,258 $ 1,057,868 123,853 $ 1,136,111 Collateral Note Amount Unitprice Market price or net equity value Total of December 31,2023	Amounts in Thousands of New Taiwan Dollars; Shares / Units Percentage of Ownership 88.43% $ (123,853) $ - $ (109,233) - Note 1 83.47% 815,584 - 842,572 - Note 2 100.00% 27 - 27 - - 100.00% 91,199 - 94,668 - - 64.26% 229,301 - 229,834 - Note 3 1,012,258 $ 1,057,868 123,853 $ 1,136,111 Collateral Note Amount Unitprice Market price or net equity value Total of December 31,2023
	Shares	Amount	Shares	Amount	Shares	Amount				Shares	Percentage of Ownership	Amount	Unitprice	Total
CANCAP PHARMACEUTICAL LTD.(ordinary shares) SUNETIC BIOTHECH INC UNIVERSAL NEXT TECHNOLOGIES INC ZuniMed Biotech Co., Ltd. SynCore Biotechnology Co., Ltd. Add: Credit balance of investments accounted for using equity method Total	2,140,000 18,854,534 503,845 10,300,000 71,456,000	$ (125,028) 915,635 39 91,660 154,419	- - - - 3,506,959	$ - - - - 99,436	- - - - (52,365,487)	$ - (71,824) - - -	$ 1,139 (13,146) (12) (461) (22,709)	$ 36 (15,081) - - 17	$ - - - - (1,862)	2,140,000 18,854,534 503,845 10,300,000 22,597,472	88.43% 83.47% 100.00% 100.00% 64.26%	$ (123,853) 815,584 27 91,199 229,301	$ - - - - -	$ (109,233) 842,572 27 94,668 229,834
		1,036,725 125,028		$ 99,436		$ (71,824)	$ (35,189)	$ (15,028)	$ (1,862)			1,012,258 123,853		$ 1,057,868
		$ 1,161,753										$ 1,136,111

Note1: CANCAP PHARMACEUTICAL LTD. , which is evaluated by the equity method, has a credit balance on the book value of the long-term investment due to the

operating loss. The amount of NT$123,853 thousand has been transferred to “Financial Assets measured at Fair Value through Profit or Loss - non-current”. Note2: The decrease in this period is due to the cash dividend of NT$71,824 thousand.

Note3: SynCore Biotechnology Co., Ltd. , which is evaluated by the equity method, resolved reduce capital to offset a deficit and increase capital. Please refer to Note 6(6.) for the Company’s participation.

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Sinphar Pharmaceutical Co., Ltd. STATEMENT OF ACCUMULATED DEPERCIATION AND IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars

Please refer to Note 6(7).

Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF ACCUMULATED DEPERCIATION AND IMPAIRMENT OF INVESTMENT PROPERTY DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars

Please refer to Note 6(8).

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Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF SHORT-TERM BORROWINGS

DECEMBER 31, 2023

Description Unsecured borrowings	Nature Taiwan Cooperative Bank E.SUN Commercial Bank, Ltd. The Export-Import Bank of ROC Chang Hwa Commercial Bank, Ltd. Taishin International Bank Co., Ltd.	Ending Balance $ 100,000 80,000 80,000 50,000 50,000 $ 360,000	Amounts in Thousands of New Taiwan Dollars Contract Period Range of Interest Rate Credit Line Collateral Note 2023/10~2024/10 1.75% $ 150,000 - - 2023/09~2024/09 1.95% 100,000 - - 2023/07~2024/07 1.79% 80,000 - - 2023/06~2024/05 1.81% 150,000 - - 2023/08~2024/08 1.91% 200,000 - -	Amounts in Thousands of New Taiwan Dollars Contract Period Range of Interest Rate Credit Line Collateral Note 2023/10~2024/10 1.75% $ 150,000 - - 2023/09~2024/09 1.95% 100,000 - - 2023/07~2024/07 1.79% 80,000 - - 2023/06~2024/05 1.81% 150,000 - - 2023/08~2024/08 1.91% 200,000 - -
				- - - - -

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Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF ACCOUNTS PAYABLE

DECEMBER 31, 2023

Client Name Related parties: Sinphar Tian-Li Pharmaceutical Co., Ltd.(Hangzhou) ZuniMed Biotech Co., Ltd. Third parties: New Chiens Biotech Co., Ltd. Jim Royal Trading Co., Ltd. Lynnbros Industrial Co., Ltd. New-In Co., Ltd. Others(The amount of individual item in others does not exceed 5% of the account balance) Total	Amounts in Thousands of New Taiwan Dollars Description Amount Note Payments $ 19,972 - Payments 7,063 - 27,035 Payments 27,676 - Payments 18,190 - Payments 14,121 - Payments 13,974 - Payments 201,200 - 275,161 $ 302,196

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Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF OTHER PAYABLES

DECEMBER 31, 2023

Item Expense payable

Amounts in Thousands of New Taiwan Dollars Description Amount Wages、salaries and various allowances payable $ 39,189 Year-end bonus and performance bonus payable 71,808 Various advertising promotion fees 39,364 Various research project fees 33,427 Labor and health insurance payable 8,516 Pension expense payable 5,293 Employees’ compensation and Directors’ remuneration 16,382 Others 76,635 $ 290,614

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Sinphar Pharmaceutical Co., Ltd. STATEMENT OF LONG-TERM BORROWINGS DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars

Creditor Description Bank of Taiwan Lou Tung Branch Secured Loans Secured Loans Secured Loans Secured Loans First Commercial Bank Su’ao Branch Secured Loans Secured Loans Unsecured Loans Mega International Commercial Bank Co., Ltd. Yilan Branch Secured Loans Secured Loans Taiwan Business Bank Co., Ltd. Su’ao Branch Secured Loans Secured Loans Subtotal Less：Current portion	Amount $ 7,639 38,344 51,190 270,000 44,490 100,000 290,000 622 400,000 32,678 300,000 1,534,963 (48,490) $ 1,486,473	Contract Period	Interest Rate 2.234% 2.230% 2.415% 1.780% 2.300% 1.875% 1.925% ~1.950% 2.340% 1.650% ~1.820% 2.195% 1.725%	Collateral (Note 1) Buildings Buildings Machinery Land and buildings Land and buildings Land and buildings None Land and buildings Land and buildings Land and buildings Land and buildings	Note
		2010/12-2025/12 2013/10-2028/10 2020/07-2027/07 2023/10-2025/10 2011/12-2026/12 2023/12-2025/12 2023/12-2025/12 2005/12-2025/12 2023/01-2025/01 2007/11-2027/11 2023/03-2025/03			One-monthly installments, divided into 180 installments equal repayments One-monthly installments, divided into 180 installments equal repayments One-monthly installments, divided into 84 installments equal repayments During the credit period, maturity to renew One-monthly installments, divided into 180 installments equal repayments During the credit period, maturity to renew During the credit period, maturity to renew Six-monthly installments, divided into 40 installments equal repayments During the credit period, maturity to renew One-monthly installments, divided into 240 installments equal repayments During the credit period, maturity to renew

Note1: Please refer to Note 8 for collaterals pledged for long-term borrowings.

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Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF OPERATING REVENUES

FOR THE YEAR ENDED DECEMBER 31, 2023

Amounts in Thousands of New Taiwan Dollars

Item Pharmaceutical Healthy food Cosmetic Sales revenue Less:Sales return Sales discount Total	Quantity (Unit) Thousand grain, kilogram and liter Thousand grain, kilogram and liter Kilogram and liter	Amount $ 1,992,064 975,481 93,536 3,061,081 (19,757) (324,114) $ 2,717,210	Note
			- - - - -

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Amounts in Thousands of New Taiwan Dollars

Sinphar Pharmaceutical Co., Ltd. STATEMENT OF OPERATING COSTS FOR THE YEAR ENDED DECEMBER 31, 2023

Item Raw materials： Beginning raw materials Add: Raw materials purchased Less: Ending raw materials Scrap of inventories Transfers to expense Raw materials sold Loss on physical inventory Raw materials used during the year Supplies： Beginning supplies Add: Supplies purchased gain on physical inventory Less: Ending supplies Scrap of inventories Transfers to expense Supplies sold Supplies used during the year Direct labor Manufacturing expense Manufacturing cost Add: Beginning work in progress Outsourcing costs Less: Ending work in progress Scrap of inventories Transfers to expense Loss on physical inventory Cost of finished goods and merchandise Add: Beginning finished goods and merchandise Finished goods purchased Gain on physical inventory Less: Ending finished goods and merchandise Scrap of inventories Transfers to expense Cost of goods manufactured and sold Other operating costs Total operating costs

Amount $ 292,658 869,213 (335,441) (2,317) (4,822) (6,285) (47) 812,959 55,346 260,054 1,446 (49,304) (1,840) (2,339) (240) 263,123 146,105 486,678 1,708,865 93,699 39,051 (74,607) (1,370) (4,938) (1,114) 1,759,586 257,689 5,970 1 (302,743) (5,741) (13,535) 1,701,227 (17,033) $ 1,684,194

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Sinphar Pharmaceutical Co., Ltd.

STATEMENT OF OPERATING EXPENSE

FOR THE YEAR ENDED DECEMBER 31, 2023

Item Wages and salaries Freight Advertisement expense Insurance expense Entertainment expense Depreciation Amortizations Meal expense Training expense Consumables Service fee Promotional expenses Others (Note) Expected credit losses	Selling Expenses $ 186,461 22,202 62,951 12,909 4,470 11,433 1,662 5,732 7,830 301 899 64,457 52,418 $ 433,725	Amounts in Thousands of New Taiwan Dollars Administrative Expenses Research and Development Expenses Total $ 53,500 $ 52,863 $ 292,824 16 19 22,237 3,448 - 66,399 7,014 5,372 25,295 9,210 804 14,484 4,781 12,519 28,733 13,945 7,939 23,546 1,453 2,190 9,375 890 147 8,867 7 13,473 13,781 15,686 583 17,168 - - 64,457 26,133 26,237 104,788 $ 136,083 $ 122,146 691,954 1,699 $ 693,653	Amounts in Thousands of New Taiwan Dollars Administrative Expenses Research and Development Expenses Total $ 53,500 $ 52,863 $ 292,824 16 19 22,237 3,448 - 66,399 7,014 5,372 25,295 9,210 804 14,484 4,781 12,519 28,733 13,945 7,939 23,546 1,453 2,190 9,375 890 147 8,867 7 13,473 13,781 15,686 583 17,168 - - 64,457 26,133 26,237 104,788 $ 136,083 $ 122,146 691,954 1,699 $ 693,653
			$ 292,824 22,237 66,399 25,295 14,484 28,733 23,546 9,375 8,867 13,781 17,168 64,457 104,788
			691,954 1,699
			$ 693,653

Note: The amount of each item in others does not exceed 5% of the account balance.

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