SOI — Annual Report 2024

Nov 19, 2024

Silicon Optronics, Inc. and Subsidiaries

Consolidated Financial Statements for the Years Ended December 31, 2024 and 2023 and Independent Auditors' Report

DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

The companies required to be included in the consolidated financial statements of affiliates in accordance with the "Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises" for the year ended December 31, 2024 are all the same as the companies required to be included in the consolidated financial statements of the parent company and its subsidiaries under International Financial Reporting Standard 10 "Consolidated Financial Statements." Relevant information that should be disclosed in the consolidated financial statements of affiliates has all been disclosed in the consolidated financial statements of the parent company and its subsidiaries. Hence, we have not prepared a separate set of consolidated financial statements of affiliates.

Very truly yours,

Silicon Optronics, Inc.

By:

Xinping He Chairman

March 17, 2025

the validity of sales revenue from the key customers as a key audit matter for the year ended December 31, 2024. For the accounting policies on revenue recognition, refer to Note 4(m) to the consolidated financial statements.

Our main audit procedures performed with respect to the above-mentioned key audit matter are as follows:

• 1. We obtained an understanding of the design and implementation of internal controls on revenue recognition and tested the effectiveness of these controls.
• 1. We confirmed the occurrence of sales revenue as follows: we selected samples and inspected the relevant supporting documents and accounting records, and we verified the accuracy of the amounts and revenue recognized.

Inventory Valuation

As of December 31, 2024, the Group's inventory balance was \$1,171,279 thousand, accounting for 45% of the combined total assets. For the related accounting policies, refer to Note 4(g) to the consolidated financial statements. Since the amount of inventory is significant and the assessment of net realizable value involves significant management judgments, we considered the inventory valuation a key audit matter.

Our main audit procedures performed with respect to the above-mentioned key audit matter are as follows:

• 1. Based on our understanding of the industry and nature of the products of the Group, we verified the appropriateness of the method of inventory aging management, and we also selected samples of and tested the appropriateness of the aging classification.
• 1. We performed recalculations and determined that the assessment of the net realizable value was reasonable, and we verified that the inventories were measured at the lower of cost and net realizable value based on the most recent raw material quotes or sales data. We also assessed the reasonableness of the assessment of changes in the provision for inventory write-downs.
• 1. We obtained and verified the details of inventory valuation and obsolescence losses and aging data, and we analyzed the reasons for the differences in the provision for loss in 2024 compared to 2023. We also assessed that the provision for inventory valuation and obsolescence losses was appropriate.

Other Matter

We have also audited the parent company only financial statements of Silicon Optronics, Inc. as of and for the years ended December 31, 2024 and 2023, on which we have issued an unmodified opinion.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and IFRS, IAS, IFRIC and SIC endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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

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

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

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

As part of an audit in accordance with the Standards on Auditing 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 consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• 1. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• 1. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• 1. Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• 1. Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• 1. Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the Group audit. We remain solely responsible for our audit opinion.

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 consolidated financial statements for the year ended December 31, 2024 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 audits resulting in this independent auditors' report are Ming-Hui Chen and Tung-Hui Yeh.

Deloitte & Touche Taipei, Taiwan Republic of China

March 17, 2025

Notice to Readers

The accompanying consolidated financial statements are intended only to present the consolidated financial position, financial performance and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are those generally applied in the Republic of China.

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

	2024		2023			2024		2023
ASSETS	Amount	%	Amount	%	QUITY LIABILITIES AND E	Amount	%	Amount	%
CURRENT ASSETS					CURRENT LIABILITIES
quivalents (Notes 4 and 6) Cash and cash e	817,302 \$	32 3	\$ 1,034,994	33 1	Short - term loan (Notes 4 and 15)	- \$	- 1	200,000 \$	7 1
Accounts receivable - net (Notes 4 and 8) Inventories (Notes 4, 5 and 9)	64,249 1,171,279	45	46,151 1,524,493	49	Contract liabilities - current (Note 19) yable (Note 4) a Accounts	11,817 108,670	4	38,995 88,391	3
yments and other current assets (Notes 4, 14 a p Pre					penses and other current liabilities Accrued ex p
and 25)	134,090	5	175,444	6	(Notes 4 and 16)	30,930	1	31,932	1
					Current tax liabilities (Notes 4 and 21)	7,485	-	1,129	-
Total current assets	2,186,920	85	2,781,082	89	Lease liabilities - current (Notes 4 and 12)	3,630	-	6,478	-
					portion of long - term borrowing (Note 15) Current	50,000	2	100,000	3
NON-CURRENT ASSETS					Refund liabilities - current (Note 16)	53,200	2	79,266	3
Financial assets at amortized cost - noncurrent
pment (Notes 4, 11 and 27) (Notes 4, 7, 25 and 27) qui y, plant and e Pro	3,572 52,094	- 2	3,549 30,580	- 1	Total current liabilities	265,732	10	546,191	18
ght-of-use assets (Notes 4 and 12) pert Ri	8,809	-	7,661	-	NON-CURRENT LIABILITIES
Goodwill (Note 4)	199,228	8	199,228	7	g-term loan (Notes 4 and 15) Lon	-	-	200,000	6
gible assets (Notes 4 and 13) Intan	11,306	1	1,240	-	Deferred income tax liabilities (Notes 4 and 21)	4,724	-	-	-
Deferred tax assets (Notes 4 and 21)	113,244	4	96,592	3	Lease liabilities - non-current (Notes 4 and 12)	5,002	1	961	-
Other non-current assets (Notes 4, 14 and 17)	9,113	-	8,666	-	Total non-current liabilities		1		6
Total non-current assets	397,366	15	347,516	11		9,726		200,961
					Total liabilities	275,458	11	747,152	24
					QUITY ATTRIBUTABLE TO SHAREHOLDERS OF THE COMPANY (Notes 4, 18 and 23) E
					Ordinary shares	774,759	30	784,559	25
					plus pital sur Ca	1,146,572	44	1,209,326	39
					gs Retained earnin
					gal reserve Le	180,425	7	180,425	6
					pecial reserve S	-	-	-	-
					gs priated earnin pro p Una	202,226	8	304,822	9
					quity Other e
					ge differences on translating the financial Exchan
					perations gn o statements of forei	4,846	-	(691)	-
					Treasury shares	-	-	(96,995)	(3)
					quity Total e	2,308,828	89	2,381,446	76
TOTAL	\$ 2,584,286	100	\$ 3,128,598	100	TOTAL	\$ 2,584,286	100	\$ 3,128,598	100

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars) The accompanying notes are an integral part of the consolidated financial statements.

• 6 -

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

	2024		2023
	Amount	%	Amount	%
OPERATING REVENUE (Notes 4, 19 and 30)	\$ 1,731,031	100	\$ 1,663,499	100
OPERATING COSTS (Notes 9 and 20)	1,606,492	93	1,707,026	102
GROSS PROFIT	124,539	7	(43,527)	(2)
OPERATING EXPENSES (Notes 20 and 26) Selling and marketing expenses	18,483	1	18,629	1
General and administrative expenses	38,675	2	44,011	3
Research and development expenses	260,424	15	265,285	16
Total operating expenses	317,582	18	327,925	20
OPERATING INCOME	(193,043)	(11)	(371,452)	(22)
NON-OPERATING INCOME AND EXPENSES (Note 20)
Interest income Other income	43,827 360	2 -	35,892 104	2 -
Other gains and losses	54,388	3	(1,717)	-
Financial costs	(6,774)	-	(11,139)	(1)
Total non-operating income and expenses	91,801	5	23,140	1
PROFIT BEFORE INCOME TAX	(101,242)	(6)	(348,312)	(21)
INCOME TAX EXPENSE (Notes 4 and 21)	(1,538)	-	61,596	4
NET INCOME	(102,780)	(6)	(286,716)	(17)
OTHER COMPREHENSIVE INCOME (LOSS) Items that will not be reclassified subsequently to profit or loss:
Remeasurement of defined benefit plans (Notes 4 and 17)	184	-	(1)	-
Items that may be reclassified subsequently to profit or loss
Exchange differences on translating the financial statements of foreign operations (Notes 4 and 18)	5,537	-	(714)	-
Total other comprehensive (loss) income	5,721	-	(715)	-
TOTAL COMPREHENSIVE INCOME FOR THE YEAR	\$ (97,059)	(6)	\$ (287,431)	(17)
EARNINGS PER SHARE (Note 22)
Basic Diluted	\$ (1.33) \$ (1.33)		\$ (3.70) \$ (3.70)

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

CHIPALITY AT A PARTIES
֠
CAR CAR GUERCERED ROUTED

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars)

							Translating the Difference on Other Equity Exchange
	Ordinary Share Capital Number of				Retained Earnings		Statements Financial
	(In Thousands) Shares	Amount	Capital Surplus	Legal Reserve	Special Reserve	Unappropriated Earnings	Operations of Foreign	Treasury Shares	Total Equity
BALANCE, JANUARY 1, 2023	78,456	784,559 S	1,167,789 ↔	168,164 S	5,759 ↔	598,041 ↔	23 S	(96, 995) ↔	2,627,340 €Ą
Appropriation of 2022 earnings Special reserve Legal reserve				12,261	(5,759)	$(12,261)$ 5,759
Dividends not received by shareholders beyond the deadlines
Net profit for the year ended December 31, 2023						(286, 716)			(286, 716)
Other comprehensive income (loss) for the year ended December 31, 2023						€	(714)		(715)
Total comprehensive income (loss) for the year ended December 31, 2023						(286,717)	(714)		(287.431)
Issuance of ordinary shares under employee share options
Share-based payment			41,536						41,536
BALANCE, DECEMBER 31, 2023	78,456	784,559	1,209,326	180,425		304,822	(691)	(96, 995)	2,381,446
Appropriation of 2023 earnings Special reserve Legal reserve
Net profit for the year ended December 31, 2024						(102, 780)			(102, 780)
Other comprehensive income (loss) for the year ended December 31, 2024						184	5,537		5,721
Total comprehensive income (loss) for the year ended December 31, 2024						(102.596)	5.537		(97,059)
Issuance of ordinary shares under employee share options	20	200	1,792						1,992
Cancelation of treasury shares	(1,000)	(10,000)	(86,995)					96,995
Share-based payment			22,449						22,449
BALANCE, DECEMBER 31, 2024	77,476	74,759 S	1,146,572 ⊷	180,425 ⊷	S	202,226 ⊷	4,846 ⊷	⊷	2,308,828 ⊷

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

• 8 -

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars)

	2024	2023
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before income tax	\$ (101,242)	\$ (348,312)
Adjustments for:
Depreciation expenses	50,789	51,754
Amortization expenses	3,371	2,468
Finance costs	6,774	11,139
Interest income	(43,827)	(35,892)
Share-based payment	22,449	41,536
Gain on disposal of property, plant and equipment	(13)	-
Net loss (gain) on foreign currency exchange	(23,937)	15,298
Loss from lease modification	-	-
Changes in operating assets and liabilities
Accounts receivable	(16,086)	(12,523)
Inventories	353,214	886,451
Prepayments and other current assets	42,190	18,406
Contract liabilities	(28,058)	(28,887)
Accounts payable	17,354	(184,240)
Accrued expenses and other current liabilities	(2,831)	(25,082)
Refund liabilities	(26,066)	25,325
Net defined benefit assets Cash generated from (used in) operations	(42) 254,039	(44) 417,397
Income tax paid	(7,110)	(55,660)
Net cash generated from (used in) operating activities	246,929	361,737
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of financial assets at amortized cost	(23)	(21)
Proceeds from financial assets at amortized cost	-	-
Payments of property, plant and equipment	(61,114)	(33,845)
Disposal of property, plant and equipment	-	-
Increase in refundable deposits	-	(3,469)
Decrease in refundable deposits	3	-
Payments for intangible assets	(13,204)	(2,679)
Payments for right-of-use assets	(2,205)	(2,288)
Interest received	47,118	33,070
Net cash generated from investing activities	(29,425)	(9,232)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from short-term loans	100,000	780,000
Repayments of short-term loans	(300,000)	(730,000)
Proceeds from long-term loans	-	-
Repayments of long-term loans	(250,000)	(100,000)
Repayments of guarantee deposits received	-	-
Repayment of the principal portion of lease liabilities	(6,937)	(6,802) (Continued)

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars)

	2024	2023
Dividends paid Exercise of employee share options Interest paid Overdue failure to receive dividends converted into capital surplus	\$ - 1,992 (7,047) -	\$ - - (11,143) 1
Net cash used in financing activities	(461,992)	(67,944)
EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH HELD IN FOREIGN CURRENCIES	26,796	(12,203)
NET (DECREASE) INCREASE IN CASH	(217,692)	272,358
CASH AT THE BEGINNING OF THE YEAR	1,034,994	762,636
CASH AT THE END OF THE YEAR	\$ 817,302	\$ 1,034,994

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

1. GENERAL INFORMATION

Silicon Optronics, Inc. (the "Company") was incorporated in the Republic of China ("ROC") on May 24, 2004 and commenced business on May 27, 2004. The Company's main business activities include the design, development and sales of complementary metal-oxide semiconductors.

The Company's shares have been listed on the Taiwan Stock Exchange (TWSE) since July 2018.

The consolidated financial statements of the Company and its subsidiaries (collectively referred to as the "Group") are presented in the Company's functional currency, the New Taiwan dollar.

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved by the board of directors and authorized for issue on March 11, 2025.

3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS

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

The initial application of the IFRS Accounting Standards endorsed and issued into effect by the FSC did not have material impact on the Group's accounting policies.

b. The IFRS Accounting Standards endorsed by the FSC for application starting from 2025

New, Amended and Revised Standards and Interpretations	Effective Date Announced by IASB
Amendments to IAS 21 "Lack of Exchangeability" Amendments to IFRS 9 and IFRS 7 "Amendments to the Classification and Measurement of Financial Instruments" - the amendments to the application guidance of classification of financial assets	January 1, 2025 (Note 1) January 1, 2026 (Note 2)

Note 1: An entity shall apply those amendments for annual reporting periods beginning on or after January 1, 2025. Upon initial application of the amendments to IAS 21, the Group shall not restate the comparative information and shall recognize any effect of initially applying the amendments as an adjustment to the opening balance of retained earnings or, if applicable, to the cumulative amount of translation differences in equity as well as affected assets or liabilities.

• Note 2: An entity shall apply those amendments for annual reporting periods beginning on or after January 1, 2026. It is permitted to apply these amendments for an earlier period beginning on January 1, 2025. An entity shall apply the amendments retrospectively but is not required to restate prior periods. The effect of initially applying the amendments shall be recognized as an adjustment to the opening balance at the date of initial application. An entity may restate prior periods if, and only if, it is possible to do so without the use of hindsight.
• c. The IFRS Accounting Standards in issue but not yet endorsed and issued into effect by the FSC

New, Amended and Revised Standards and Interpretations	Effective Date Announced by IASB (Note 1)
Annual Improvements to IFRS Accounting Standards - Volume 11	January 1, 2026
Amendments to IFRS 9 and IFRS 7 "Amendments to the	January 1, 2026
Classification and Measurement of Financial Instruments" - the
amendments to the application guidance of derecognition of
financial liabilities
Amendments to IFRS 9 and IFRS 7 "Contracts Referencing	January 1, 2026
Nature-dependent Electricity"
Amendments to IFRS 10 and IAS 28 "Sale or Contribution of Assets	To be determined by IASB
between an Investor and its Associate or Joint Venture"
IFRS 17 "Insurance Contracts"	January 1, 2023
Amendments to IFRS 17	January 1, 2023
Amendments to IFRS 17 "Initial Application of IFRS 17 and IFRS 9 - Comparative Information"	January 1, 2023
IFRS 18 "Presentation and Disclosure in Financial Statements"	January 1, 2027
IFRS 19 "Subsidiaries without Public Accountability: Disclosures"	January 1, 2027

Note 1: Unless stated otherwise, the above IFRS Accounting Standards are effective for annual reporting periods beginning on or after their respective effective dates.

Except for the above impact, as of the date the parent company only financial statements were authorized for issue, the Company is continuously assessing the possible impact of the application of other standards and interpretations on the Company's financial position and financial performance and will disclose the relevant impact when the assessment is completed.

4. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION

a. Statement of compliance

The consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRS Accounting Standards as endorsed and issued into effect by the FSC.

b. Basis of preparation

The consolidated financial statements have been prepared on the historical cost basis except for financial instruments which are measured at fair value and net defined benefit liabilities which are measured at the present value of the defined benefit obligation less the fair value of plan assets.

The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to which the fair value measurement inputs are observable and based on the significance of the inputs to the fair value measurement in its entirety, are described as follows:

1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;

• 2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
• 3) Level 3 inputs are unobservable inputs for an asset or liability.
• c. Classification of current and non-current assets and liabilities

Current assets include:

• 1) Assets held primarily for the purpose of trading;
• 2) Assets expected to be realized within 12 months after the reporting period, and
• 3) 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.

Current liabilities include:

• 1) Liabilities held primarily for the purpose of trading;
• 2) Liabilities due to be settled within 12 months after the reporting period; and
• 3) Liabilities for which the Group does not have an unconditional right to defer settlement for at least 12 months after the reporting period.

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

d. Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and the entities controlled by the Company (i.e., its subsidiaries).

Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statement of profit or loss and other comprehensive income from the effective dates of acquisitions up to the effective dates of disposals, as appropriate.

When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Company.

All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation.

Refer to Notes 10 and 29 for detailed information on subsidiaries (including the percentages of ownership and main businesses).

e. Business combinations

Acquisitions of businesses are accounted for using the acquisition method. Acquisition-related costs are generally recognized in profit or loss as they are incurred.

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer's previously held equity interests in the acquiree over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed.

f. Foreign currencies

In preparing the financial statements of each entity, transactions in currencies other than the entity's functional currency (i.e., foreign currencies) 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 in which they arise.

Non-monetary items that are measured at historical cost in a foreign currency are not retranslated.

For the purpose of presenting the consolidated financial statements, the functional currencies of the Group's foreign operations (including subsidiaries, associates, joint ventures and branches in other countries or those that use currencies which are 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; and income and expense items are translated at the average exchange rates for the period. The resulting currency translation differences are recognized in other comprehensive income (attributed to the owners of the Company and non-controlling interests as appropriate).

g. Inventories

Inventories consist of raw materials, supplies, finished goods and work in progress and are stated at the lower of cost and net realizable value. Inventory write-downs are made by item, except where it may be appropriate to group similar or related items. The net realizable value is the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. Inventories are recorded at the weighted-average cost on the balance sheet date.

h. Property, plant and equipment

Property, plant and equipment are initially measured at cost and subsequently measured at cost less accumulated depreciation and accumulated impairment loss.

Depreciation of property, plant and equipment is recognized using the straight-line method. Each significant part is depreciated separately. If the lease term of an item of property, plant and equipment is shorter than its useful life, it is depreciated over the lease term. The estimated useful lives, residual values and depreciation methods are reviewed at the end of each reporting period, with the effects of any changes in the estimates accounted for on a prospective basis.

On derecognition of an item of property, plant and equipment, the difference between the sales proceeds and the carrying amount of the asset is recognized in profit or loss.

i. Goodwill

Goodwill arising from the acquisition of a business is measured at cost as established at the date of acquisition of the business less accumulated impairment loss.

For the purposes of impairment testing, goodwill is allocated to each of the Group's cash-generating units or groups of cash-generating units (referred to as "cash-generating units") that is expected to benefit from the synergies of the combination.

A cash-generating unit to which goodwill has been allocated is tested for impairment annually or more frequently when there is an indication that the unit may be impaired, by comparing its carrying amount, including the attributed goodwill, with its recoverable amount. However, if the goodwill allocated to a cash-generating unit was acquired in a business combination during the current annual period, that unit shall be tested for impairment before the end of the current annual period. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then pro rata to the other assets of the unit based on the carrying amount of each asset in the unit. Any impairment loss is recognized directly in profit or loss. Any impairment loss recognized for goodwill is not reversed in subsequent periods.

If goodwill has been allocated to a cash-generating unit and the entity disposes of an operation within that unit, the goodwill associated with the operation which is disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal and is measured on the basis of the relative values of the operation disposed of and the portion of the cash-generating unit retained.

j. Intangible assets

1) Intangible assets acquired separately

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. The estimated useful lives, residual values, and amortization methods are reviewed at the end of each reporting period, with the effect of any changes in the estimates accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired separately are measured at cost less accumulated impairment loss.

2) Derecognition of intangible assets

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

k. Impairment of property, plant and equipment, right-of-use asset, intangible assets other than goodwill and assets related to contract costs

At the end of each reporting period, the Group reviews the carrying amounts of its property, plant and equipment, right-of-use asset and intangible assets, excluding goodwill, for any indication of impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of a corporate asset, the asset is tested for impairment in the context of the cash-generating unit to which the asset belongs.

Corporate assets are allocated to the individual cash-generating units on a reasonable and consistent basis of allocation.

The recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount, with the resulting impairment loss recognized in profit or loss.

When an impairment loss is subsequently reversed, the carrying amount of the corresponding asset, cash-generating unit is increased to the revised estimate of its recoverable amount, but only to the extent of the carrying amount that would have been determined had no impairment loss been recognized for the asset, cash-generating unit in prior years. A reversal of an impairment loss is recognized in profit or loss.

l. Financial instruments

Financial assets and financial liabilities are recognized when the Group becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially recognized 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.

1) Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis.

a) Measurement category

Financial assets are classified as financial assets at amortized cost.

i. Financial assets at amortized cost

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

• i) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
• ii) 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 at amortized cost, including cash and cash equivalents, trade receivables, other receivables time deposit with original maturities of more than 3 months and refundable deposits, are measured at amortized cost, which equals the gross carrying amount determined using the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset, except for:

• i) Purchased or originated credit-impaired financial asset, for which interest income is calculated by applying the credit-adjusted effective interest rate to the amortized cost of the financial asset; and
• ii) Financial assets that are not credit-impaired on purchase or origination but have subsequently become credit-impaired, for which interest income is calculated by applying the effective interest rate to the amortized cost of such financial assets in subsequent reporting periods.

Cash equivalents include time deposits with original maturities within 3 months from the date of acquisition, which are highly liquid, readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. These cash equivalents are held for the purpose of meeting short-term cash commitments.

b) Impairment of financial assets

The Group recognizes a loss allowance for expected credit losses on financial assets at amortized cost (including trade receivables).

The Group always recognizes lifetime expected credit losses (ECLs) for trade receivables. For all other financial instruments, the Group recognizes lifetime ECLs when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on a financial instrument has not increased significantly since initial recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECLs.

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

The impairment loss of all financial assets is recognized in profit or loss by reduction in their carrying amounts through a loss allowance account.

c) Derecognition of financial assets

The Group derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party.

On derecognition of a financial asset at amortized cost in its entirety, the difference between the asset's carrying amount and the sum of the consideration received and receivable is recognized in profit or loss.

2) Equity instruments

Equity instruments issued by the Group are classified as equity in accordance with the substance of the contractual arrangements and the definitions of an equity instrument.

Equity instruments issued by the Group are recognized at the proceeds received, net of direct issue costs.

The repurchase of the Group's own equity instruments is recognized in and deducted directly from equity. No gain or loss is recognized in profit or loss on the purchase, sale, issuance or cancellation of the Group's own equity instruments.

• 3) Financial liabilities
• a) Subsequent measurement

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

b) Derecognition of financial liabilities

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

m. Revenue recognition

The Group identifies contracts with customers, allocates the transaction price to the performance obligations and recognizes revenue when performance obligations are satisfied.

1) Revenue from the sale of goods

Revenue from the sale of goods comes from the sale of image sensing products. Revenue and receivables from the sale of goods are recognized when the goods are delivered to the customer's specific location because it is the time when the customer has full discretion over the manner of distribution and price to sell the goods, has the primary responsibility for sales to future customers and bears the risk of obsolescence. The transaction price received in advance is recognized as a contract liability until the goods has been delivered to the customer.

The Group does not recognize revenue on materials delivered to subcontractors because this delivery does not involve a transfer of control.

2) Revenue from the rendering of services

Revenue from the rendering of services comes from providing entrusted design services in accordance with customer contract specifications and are recognized when performance obligations are fulfilled.

The Group does not recognize revenue on materials delivered to subcontractors because this delivery does not involve a transfer of control.

n. Leases

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

The Group as lessee

Except for short-term leases and low-value asset leases that are recognized as expenses on a straight-line basis over the lease terms, the Group recognizes right-of-use assets and lease liabilities for all leases at the commencement date of a lease.

Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease liabilities adjusted for lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs needed to restore the underlying assets, and less any lease incentives received. Subsequently, the right-of-use assets are measured at cost less accumulated depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities. Right of-use assets are presented on a separate line in the consolidated balance sheets.

Right-of-use assets are depreciated using the straight-line method from the commencement dates to the earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.

Lease liabilities are initially measured at the present value of the lease payments, which comprises fixed payments. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the Group uses the lessee's incremental borrowing rate.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in a lease term, the Company remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. For a lease modification that is not accounted for as a separate lease, the Company accounts for the remeasurement of the lease liability by (a) decreasing the carrying amount of the right-of-use asset of lease modifications that decreased the scope of the lease, and recognizing in profit or loss any gain or loss on the partial or full termination of the lease; (b) making a corresponding adjustment to the right-of-use asset of all other lease modifications. Lease liabilities are presented on a separate line in the consolidated balance sheets.

Variable lease payments that do not depend on an index or a rate are recognized as expenses in the periods in which they are incurred.

o. Borrowing costs

Borrowing costs directly attributable to an acquisition, construction or production of qualifying assets are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

Other than those stated above, all other borrowing costs are recognized in profit or loss in the period in which they are incurred.

p. Employee benefits

Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as expenses when employees have rendered services entitling them to the contributions.

Defined benefit costs (including service cost, net interest and remeasurement) under defined benefit retirement benefit plans are determined using the projected unit credit method. Service cost (including current service cost) and net interest on the net defined benefit liabilities (assets) are recognized as employee benefits expense in the period in which they occur. Remeasurement, comprising actuarial gains and losses and the return on plan assets (excluding interest), is recognized in other comprehensive income in the period in which it occurs. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss.

Net defined benefit liabilities (assets) represent the actual deficit (surplus) in the Group's defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.

q. Share-based payment arrangements

Employee share options granted

The fair value at the grant date of the employee share options is expensed on a straight-line basis over the vesting period, based on the Group's best estimates of the number of shares or options that are expected to ultimately vest, with a corresponding increase in capital surplus - employee share options. It is recognized as an expense in full at the grant date if vested immediately.

At the end of each reporting period, the Group revises its estimate of the number of employee share options that are expected to vest. The impact of the revision of the original estimates is recognized in profit or loss such that the cumulative expenses reflect the revised estimate, with a corresponding adjustment to capital surplus - employee share options.

r. Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

1) Current tax

Income tax payable (refundable) is based on taxable profit (loss) for the year determined according to the applicable tax laws of each tax jurisdiction.

According to the Income Tax Act in the ROC, an additional tax on unappropriated earnings is provided for in the year the shareholders approve to retain earnings.

Adjustments of prior years' tax liabilities are added to or deducted from the current year's tax provision.

2) Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities and the corresponding tax bases used in the computation of taxable profit.

Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences, to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests 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 and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the assets to be recovered. A previously unrecognized deferred tax asset is also reviewed at the end of each reporting period and recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liabilities are settled or the assets are realized, based on tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

3) Current and deferred taxes

Current and deferred taxes are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity; in which case, the current and deferred taxes are also recognized in other comprehensive income or directly in equity, respectively.

5. MATERIAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Group's accounting policies, management is required to make judgments, estimations, and assumptions on the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates.

Key Sources of Estimation Uncertainty

a. Write-down of inventories

The net realizable value of inventories is the estimated selling price in the ordinary course of business less the estimated costs of completion and disposal. The estimation of net realizable value is based on current market conditions and historical experience with product sales of a similar nature. Changes in market conditions may have a material impact on the estimation of the net realizable value.

6. CASH AND CASH EQUIVALENTS

		December 31
	2024		2023
Cash on hand	\$ 90	\$	154
Bank deposits	354,932		574,265
Cash equivalents (investments with original maturities of 3 months or less)
Time deposits in banks	462,280		460,575
	\$ 817,302		\$ 1,034,994

The market interest rate intervals of the time deposits held in banks at the end of the reporting period were as follows:

		December 31
	2024	2023
Time deposits	1.6%-4.93%	5.17%-5.80%

7. FINANCIAL ASSETS AT AMORTIZED COST

		December 31
	2024	2023
Non-current
Pledged time deposits (a and b)	\$ 3,572	\$ 3,549

a. Refer to Note 25 for information relating to their credit risk management and impairment of financial assets at amortized cost.

b. Refer to Note 27 for information relating to investments in financial assets at amortized cost pledged as security.

8. ACCOUNTS RECEIVABLE

	December 31
	2024	2023
Accounts receivable - unrelated parties
At amortized cost Gross carrying amount	\$ 64,249	\$ 46,151
Less: Allowance for impairment loss	-	-
	\$ 64,249	\$ 46,151

The average credit period of sales of goods is 30 days. No interest was charged on trade receivables.

In order to minimize credit risk, the management of the Group has delegated a team responsible for determining credit limits, credit approvals and other monitoring procedures to ensure that follow-up action is taken to recover overdue debts. In addition, the Group reviews the recoverable amount of each individual trade debt at the end of the reporting period to ensure that adequate allowance is made for possible irrecoverable amounts. In this regard, the management believes the Group's credit risk was significantly reduced.

The Group measures the loss allowance for trade receivables at an amount equal to lifetime ECLs. The expected credit losses on trade receivables are estimated using a provision matrix by reference to the past default records of the debtor and an analysis of the debtor's current financial position, adjusted for general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of economic conditions at the reporting date. As the Group's historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished according to the Group's different customer base.

The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation, whichever occurs earlier. For trade receivables that have been written off, the Group continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are recognized in profit or loss.

The following table details the loss allowance of trade receivables based on the Group's provision matrix.

December 31, 2024

Item	Not Past Due	Past Due Up to 60 Days	Past Due 61 to 90 Days	Past Due 91 to 120 Days	Past Due 121 to 150 Days	Past Due 151 to 180 Days	Past Due Over 181 Days	Total
Gross carrying amount Loss allowance (Lifetime ECL)	\$ 57,611 -	\$ 6,638 -	\$ - -	\$ - -	\$ - -	\$ - -	\$ - -	\$ 64,249 -
Amortized cost	\$ 57,611	\$ 6,638	\$ -	\$ -	\$ -	\$ -	\$ -	\$ 64,249
December 31, 2023
Item	Not Past Due	Past Due Up to 60 Days	Past Due 61 to 90 Days	Past Due 91 to 120 Days	Past Due 121 to 150 Days	Past Due 151 to 180 Days	Past Due Over 181 Days	Total
Gross carrying amount Loss allowance (Lifetime ECL)	\$ 46,151 -	\$ - -	\$ - -	\$ - -	\$ - -	\$ - -	\$ - -	\$ 46,151 -
Amortized cost	\$ 46,151	\$ -	\$ -	\$ -	\$ -	\$ -	\$ -	\$ 46,151

9. INVENTORIES

The movements in the allowance for doubtful accounts were as follows:

		December 31
	2024	2023
Finished goods Work in progress Raw materials	\$ 801,473 366,477 3,329	\$ 995,794 522,383 6,316
	\$ 1,171,279	\$ 1,524,493

The nature of the cost of goods sold is as follows:

		For the Year Ended December 31
	2024	2023
Cost of inventories sold Inventory write-downs (reversed) (a)	\$ 1,380,316 226,176	\$ 1,386,892 320,134
	\$ 1,606,492	\$ 1,707,026

a. Inventory write-downs were reversed as a result of sale has been recognized inventory obsolescence.

10. SUBSIDIARIES

				Percentage% of Ownership
				December 31
Investor	Investee	Main Business	2024	2023
Silicon Optronics, Inc.	NUEVA IMAGING, INC. ("NUEVA")	Research and development and design of high order CMOS Image Sensor products	100%	100%
	Silicon Optronics (Cayman) Co., Ltd. ("Silicon Cayman")	Investment business	100%	100%
Silicon Optronics (Cayman) Co., Ltd.	Silicon Optronics (Shanghai) Co., Ltd.	Design, development and testing of integrated circuits and related electronic products, technical service consultation and transfer of R&D results	100%	100%

Except for US NUEVA which fulfills the definition of a major subsidiary per Article 2 of the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants, the remaining entities are non-major subsidiaries. The financial reports of the above subsidiaries had been audited by accountants.

11. PROPERTY, PLANT AND EQUIPMENT

	Testing Equipment	R&D Equipment	Molding Equipment	Computer	Office Equipment	Photomasks	Total
Cost
Balance at January 1, 2024 Additions Disposal Effect of exchange rate changes	\$ 1,065 - - 12	\$ - - - -	\$ 8,760 - (5,670 ) -	\$ 1,742 161 (118 ) 45	\$ 1,789 26 - 117	\$ 60,508 62,898 (32,726 ) -	\$ 73,864 63,085 (38,514 ) 174
Balance at December 31, 2024	\$ 1,077	\$ -	\$ 3,090	\$ 1,830	\$ 1,932	\$ 90,680	\$ 98,609 (Continued)

	Testing Equipment	R&D Equipment	Molding Equipment	Computer	Office Equipment	Photomasks	Total
Accumulated depreciation
Balance at January 1, 2024 Depreciation expense Disposal Effect of exchange rate changes	\$ 735 152 - 11	\$ - - - -	\$ 6,062 1,048 (5,670 ) -	\$ 1,282 243 (118 ) 35	\$ 1,737 32 - 115	\$ 32,285 40,109 (32,726 ) -	\$ 42,101 41,584 (38,514 ) 161
Balance at December 31, 2024	\$ 898	\$ -	\$ 1,140	\$ 1,442	\$ 1,885	\$ 39,668	\$ 45,332
Accumulated impairment
Balance at January 1, 2024 and December 31, 2024	\$ -	\$ -	\$ 1,183	\$ -	\$ -	\$ -	\$ 1,183
Carrying amounts at December 31, 2024	\$ 179	\$ -	\$ 467	\$ 388	\$ 48	\$ 51,012	\$ 52,094
Cost
Balance at January 1, 2023 Additions Disposal Effect of exchange rate changes	\$ 1,071 - - (6 )	\$ - - - -	\$ 12,404 - (36,401 ) -	\$ 1,561 204 - (23 )	\$ 1,791 - - (2 )	\$ 92,991 27,782 (59,495 ) -	\$ 109,048 27,986 (63,139 ) (31 )
Balance at December 31, 2023	\$ 1,065	\$ -	\$ 8,760	\$ 1,742	\$ 1,789	\$ 60,508	\$ 73,864
Accumulated depreciation
Balance at January 1, 2023 Depreciation expense Disposal Effect of exchange rate changes	\$ 561 180 - (6 )	\$ - - - -	\$ 7,020 2,587 (35,457 ) -	\$ 1,064 242 - (24 )	\$ 1,710 29 - (2 )	\$ 52,155 39,625 (59,495 ) -	\$ 62,510 42,663 (63,040 ) (32 )
Balance at December 31, 2023	\$ 735	\$ -	\$ 6,062	\$ 1,282	\$ 1,737	\$ 32,285	\$ 42,101
Accumulated impairment
Balance at January 1, 2023 and December 31, 2023	\$ -	\$ -	\$ 1,183	\$ -	\$ -	\$ -	\$ 1,183
Carrying amounts at December 31, 2023	\$ 330	\$ -	\$ 1,515	\$ 460	\$ 52	\$ 28,223	\$ 30,580 (Concluded)

The Group's property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives as follows:

Testing equipment	2-5 years
R&D equipment	15 years
Molding equipment	3 years
Computers	3 years
Office equipment	5 years
Photomasks	2 years

12. LEASE ARRANGEMENTS

a. Right-of-use assets

	December 31
	2024	2023
Carrying amount
Buildings	\$ 8,809	\$ 7,661

	For the Year Ended December 31
	2024	2023
Additions to right-of-use assets	\$ 2,205	\$ 2,288
Depreciation charge for right-of-use assets Buildings	\$ 9,205	\$ 9,091

Except for the aforementioned addition and recognized depreciation, the Group did not have significant sublease or impairment of right-of-use assets during the years ended December 31, 2024 and 2023.

b. Lease liabilities

	December 31
	2024	2023
Carrying amount
Current	\$ 3,630	\$ 6,478
Non-current	\$ 5,002	\$ 961
The discount rate for lease liabilities was as follows:
		December 31
	2024	2023
Buildings	1.46%	1.46%

c. Material lease activities and terms

The Group did not have significant new lease contracts in 2024 and 2023. The Group leases buildings for the use of offices with lease terms of 3-4 years. The Group does not have bargain purchase options to acquire the buildings at the expiration of the lease periods. In addition, the Group is prohibited from subleasing or transferring all or any portion of the underlying assets without the lessor's consent.

d. Other lease information

		December 31
		2024	2023
Expenses relating to short-term leases Expenses relating to low-value asset leases Total cash outflow for leases		\$ 466 \$ 33 \$ (7,542)	\$ 466 \$ 34 \$ (7,465)
13. INTANGIBLE ASSETS	Patents	Software	Total
Cost
Balance at January 1, 2024 Additions Transfer Effect of exchange rate changes	\$ 15,276 - - 1,035	\$ 27,960 13,204 - 1,950	\$ 43,236 13,204 - 2,985
Balance at December 31, 2024	\$ 16,311	\$ 43,114	\$ 59,425 (Continued)

	Patents	Software	Total
Accumulated amortization
Balance at January 1, 2024 Amortization expense Effect of exchange rate changes	\$ 15,276 - 1,035	\$ 26,720 3,371 1,717	\$ 41,996 3,371 2,752
Balance at December 31, 2024	\$ 16,311	\$ 31,808	\$ 48,119
Carrying amounts at December 31, 2024	\$ -	\$ 11,306	\$ 11,306
Cost
Balance at January 1, 2023 Additions Transfer Effect of exchange rate changes	\$ 15,278 - - (2)	\$ 27,572 2,679 (2,249) (42)	\$ 42,850 2,679 (2,249) (44)
Balance at December 31, 2023	\$ 15,276	\$ 27,960	\$ 43,236
Accumulated amortization
Balance at January 1, 2023 Amortization expense Effect of exchange rate changes	\$ 15,278 - (2)	\$ 24,285 2,468 (33)	\$ 39,563 2,468 (35)
Balance at December 31, 2023	\$ 15,276	\$ 26,720	\$ 41,996
Carrying amounts at December 31, 2023	\$ -	\$ 1,240	\$ 1,240 (Concluded)

Except for the recognition of amortization expense, there were no significant additions, disposals and impairment of the Group's other intangible assets for the years ended December 31, 2024 and 2023.

The above items of intangible assets are amortized on a straight-line basis over their estimated useful lives as follows:

Patents	3-7 years
Software	1-6 years

At the end of each year, the Group performs evaluation of goodwill for impairment primarily by reviewing the recoverable amounts based on value in use which incorporates cash flow projections estimated by management covering a five-year period. The cash flows beyond that five-year period are extrapolated using a steady per annum growth rate. In assessing value in use, the estimated future cash flows are discounted to their present value using annual pre-tax discount rates which were 13.50% and 12.09% as of December 31, 2024 and 2023, respectively. Based on the assessment, no impairment loss was recognized for the years ended December 31, 2024 and 2023.

14. OTHER ASSETS

	December 31
	2024	2023
Current
Prepayments for purchases	\$ 81,518	\$ 87,780
Prepaid income tax	38,391	46,094
Tax receivables of business tax	10,953	35,414
Overpaid sales tax	-	-
Others	3,228	6,156
	\$ 134,090	\$ 175,444
Non-current
Refundable deposits	\$ 7,328	\$ 7,107
Net defined benefit assets	1,785	1,559
	\$ 9,113	\$ 8,666
15. BORROWINGS
a. Short-term loan

		December 31
	2024	2023
Unsecured loan
Bank loan	\$ -	\$ 200,000

The range of weighted average effective interest rates on bank loans was 2.08%-2.50% per annum on December 31, 2022.

b. Long-term loan

	December 31
	2024	2023
Unsecured loan
Bank loan (1)	\$ 50,000	\$ 300,000
Less: Current portion	50,000	100,000
Long-term loan	\$ -	\$ 200,000

1) The Group acquired a new bank loan with a floating interest rate of 2.03% per annum. Interest is paid monthly, and the principal is to be repaid in seven equal semiannual installments starting in July 2023. The loan is to be repaid before July 5, 2025.

16. OTHER LIABILITIES

	December 31
	2024	2023
Current
Other payables
Payables for bonuses	\$ 16,770	\$ 18,905
Payables for purchases of equipment	4,674	2,571
Payables for employees' compensation	-	-
Payables for remuneration of directors	-	-
Others	9,280	10,277
	30,724	31,753
Other liabilities
Receipts under custody	206	179
	\$ 30,930	\$ 31,932
Refund liabilities (a)	\$ 53,200	\$ 79,266

a. Sales revenue is measured at the fair value of the consideration received or receivable, and deducted from estimated customer returns, discounts and other similar discounts. Based on historical experience and considering different contract conditions, the combined company estimates the possible sales discounts and recognizes the refund liabilities accordingly.

17. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

The Company adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed defined contribution plan. Under the LPA, an entity makes monthly contributions to employees' individual pension accounts at 6% of monthly salaries and wages.

Silicon Optronics (Shanghai) Co., Ltd. is a member of a state-managed retirement benefit plan operated by the government of the People's Republic of China. The subsidiary is required to contribute a specified percentage of payroll costs to the retirement benefit scheme to fund the benefits. The only obligation of the Group with respect to the retirement benefit plan is to make the specified contributions.

b. Defined benefit plans

The defined benefit plan adopted by the Company in accordance with the Labor Standards Act is operated by the government. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the 6 months before retirement. The Company contributes amounts equal to 2% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee's name. Before the end of each year, the Company assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Company is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the Bureau); the Company has no right to influence the investment policy and strategy.

The amounts included in the consolidated balance sheets in respect of the Company's benefit plans are as follows:

	December 31
	2024	2023
Present value of defined benefit obligation Fair value of plan assets	\$ 364 (2,149)	\$ 375 (1,934)
Net defined benefit assets	\$ (1,785)	\$ (1,559)

Movements in net defined benefit assets were as follows:

	Present Value of the Defined Benefit Obligation	Fair Value of the Plan Assets	Net Defined Benefit Assets
Balance at January 1, 2024	\$ 375	\$ (1,935)	\$ (1,560)
Net interest expense (income)	5	(25)	(20)
Recognized in profit or loss	5	(25)	(20)
Remeasurement
Actuarial (gain) loss
Actuarial loss - changes in financial
assumptions	(17)	-	(17)
Actuarial loss - experience adjustments	1	(168)	(167)
Recognized in other comprehensive loss
(income)	(16)	(168)	(184)
Contributions from the employer	-	22	22
Balance at December 31, 2024	\$ 364	\$ (2,149)	\$ (1,785)
Balance at January 1, 2023	\$ 365	\$ (1,881)	\$ (1,516)
Net interest expense (income)	5	(26)	(21)
Recognized in profit or loss	5	(26)	(21)
Remeasurement
Actuarial (gain) loss
Actuarial loss - changes in financial
assumptions	4	-	4
Actuarial loss - experience adjustments	1	(6)	(5)
Recognized in other comprehensive loss
(income)	5	(6)	(1)
Contributions from the employer	-	(22)	(22)
Balance at December 31, 2023	\$ 375	\$ (1,935)	\$ (1,560)

Through the defined benefit plans under the Labor Standards Act, the Company is exposed to the following risks:

1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.

• 2) Interest risk: A decrease in the corporate 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 plans' debt investments.
• 3) Salary risk: The present value of the defined benefit obligation is calculated using the future salaries of plan participants. As such, an increase in the salaries of the plan participants will increase the present value of the defined benefit obligation.

The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations were as follows:

	December 31
	2024	2023
Discount rate	1.7%	1.3%
Expected rate of salary increase	3.0%	3.0%

If possible reasonable changes in each of the significant actuarial assumptions occur and all other assumptions remain constant, the present value of the defined benefit obligation will increase (decrease) as follows:

	December 31
	2024	2023
Discount rate
0.25% increase	\$ (10)	\$ (12)
0.25% decrease	\$ 10	\$ 12
Expected rate of salary increase
0.25% increase	\$ 10	\$ 11
0.25% decrease	\$ (10)	\$ (11)

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

	December 31
	2024	2023
Expected contributions to the plans for the next year	\$ 22	\$ 22
Average duration of the defined benefit obligation	12 years	13 years

18. EQUITY

a. Common stock

	December 31
	2024	2023
Numbers of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued	100,000 \$ 1,000,000 77,476 \$ 774,759	100,000 \$ 1,000,000 78,456 \$ 784,559

A total of 15,000 thousand shares from the authorized share capital was reserved for the issuance of employee share options. The increase in the Company's share capital is mainly due to the employees' exercise of their employee share options.

b. Capital surplus

		December 31
	2024	2023
May be used to offset a deficit, distributed as cash dividends, or transferred to share capital (1)
Arising from issuance of ordinary shares Arising from employee share options exercised price	\$ 1,033,350 12,754	\$ 1,118,553 12,754
May not be used to offset a deficit only
Shareholders's overdue dividends not received	1	1
May not be used for any purpose
Arising from employee share options	100,467	78,018
	\$ 1,146,572	\$ 1,209,326

1) Such capital surplus may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Company's capital surplus and to once a year).

Reconciliations of the balance for each class of capital surplus were as follows:

	Premium on Issue of Shares	Arising from Employee Share Options	Other	Total
Balance at January 1, 2023 Issuance of ordinary shares	\$ 1,118,553	\$ 49,236	\$ -	\$ 1,167,789
under employee share options	-	41,536	-	41,536
Share-based payment	-	-	1	-
Balance at December 31, 2023	1,118,553	90,772	1	1,209,326
Share-based payment	1,792	-	-	1,792
Issuance of ordinary shares under employee share
options	(86,995)	-	-	(86,995)
Cancelation of treasury shares	-	22,449	-	22,449
Balance at December 31, 2024	\$ 1,033,350	\$ 113,221	\$ 1	\$ 1,146,572

c. Retained earnings and dividend policy

Under the Company's articles of incorporation (the "Articles"), where the Company made a profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting accumulated losses of previous years, setting aside as legal reserve 10% of the remaining profit, however, when the statutory surplus reserve has exceeded 50% of the total capital, it may not be set aside any more. When the special surplus reserve is set aside in accordance with Article 41 of the Securities and Exchange Law, the insufficient amount of the "net amount of other equity deductions accumulated in the previous period" shall be set aside the same amount of special surplus reserve from the undistributed earnings of the previous period before the distribution of earnings, Items other than the current after tax net profit added to the current after tax net profit are included in the current undistributed earnings. Setting aside or reversing a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company's board of directors as the basis for proposing a distribution plan, which should be resolved in the shareholders' meeting for the distribution of dividends and bonuses to shareholders. For the policies on the distribution of employees' compensation and remuneration of directors after the amendment, refer to "Employees' compensation and remuneration of directors" in Note 20 (g).

Considering that the Company is in a period of operational growth, taking into account the interests of the Company's shareholders and long-term capital and business planning, no more than 90% of the accumulated distributable earnings should be distributed as dividends, out of which no less than 10% of the total dividends distributed should be in the form of cash dividends. If the Company has no distributable earnings for the year, or if there are earnings but the amount of earnings is much lower than that distributed in the previous year, or considering the Company's financial, business and operational factors, the Company may distribute all or part of the earnings in accordance with the law or regulations of the competent authorities.

The Company's Board of Directors resolved not to distribute dividends for 2023 in their meetings on March 12, 2024; the other proposed appropriations for 2023 were resolved by the shareholders in the shareholders' meetings on June 18, 2024.

The appropriations of earnings for 2022 which had been approved in the shareholders in their meetings on June 16, 2023, were as follows:

	Appropriation of Earnings
	For the Year Ended December 31, 2022
Legal reserve Special reserve Cash dividends Dividends per share (NT\$)	\$ 12,261 \$ (5,759) \$ - \$ -

The appropriations of earnings for 2024 are subject to the resolution of the shareholders' in their' meeting to be held on June 18, 2025.

d. Other equity items

	For the Year Ended December 31
	2024	2023
Balance, beginning of year Exchange differences on translation of the financial statements of	\$ (691)	\$ 23
foreign operations	5,537	(714)
Balance, end of year	\$ 4,846	\$ (691)

e. Treasury shares

	For the Year Ended December 31
	2024	2023
Treasury shares (In thousands of shares)	-	1,000

The Company's board of directors held a meeting on August 12, 2019 and resolved to buy back 1,000 thousand of its ordinary shares listed on the Taiwan Stock Exchange within the period starting August 13, 2019 to October 12, 2019 for transfer to its employees, at a purchase price ranging from NT\$53 to NT\$115 per share.

On August 10, 2024, The Company's board of directors resolved to cancel the 1,000 thousand shares. Subsequently, The Company completed the registration for share cancellation on October 9, 2024.

Under the Securities and Exchange Act, the Company shall neither pledge treasury shares nor exercise shareholders' rights on these shares, such as the rights to dividends and to vote.

19. REVENUE

	For the Year Ended December 31
	2024	2023
Revenue from contracts with customers
Revenue from the sale of goods Others	\$ 1,731,031 -	\$ 1,663,480 19
	\$ 1,731,031	\$ 1,663,499

a. Contract balances

	December 31
	2024	2023	2022
Accounts receivable (Note 8)	\$ 64,249	\$ 46,151	\$ 34,869
Contract liabilities - current Sale of goods	\$ 11,817	\$ 38,995	\$ 69,012

Revenue recognized in the current reporting period from the contract liabilities at the beginning of the year is as follows:

	For the Year Ended December 31
	2024	2023
From the contract liabilities at the beginning of the year
Sale of goods	\$ 36,201	\$ 65,890

b. Disaggregation of revenue

	For the Year Ended December 31
	2024	2023
Primary geographical markets
Hong Kong United States India Taiwan (the Company's operating location) Others	\$ 1,331,482 184,466 73,701 70,230 71,152 \$ 1,731,031	\$ 1,223,819 91,178 47,310 196,707 104,485 \$ 1,663,499
Major goods
CMOS Other	\$ 1,696,261 34,770	\$ 1,644,786 18,713
	\$ 1,731,031	\$ 1,663,499

20. NET PROFIT FROM CONTINUING OPERATIONS

a. Interest income

	For the Year Ended December 31
	2024	2023
Bank deposit	\$ 43,756	\$ 35,831
Financial assets at amortized cost	57	48
Others	14	13
	\$ 43,827	\$ 35,892

b. Other income

	For the Year Ended December 31
	2024	2023
Others	\$ 360	\$ 104

c. Other gains and losses

	For the Year Ended December 31
	2024	2023
Net foreign exchange gain	\$ 50,116	\$ (2,205)
Other gain	4,416	498
Other losses	(144)	(10)
	\$ 54,388	\$ (1,717)

d. Finance costs

	For the Year Ended December 31
	2024	2023
Interest on bank loans Interest on lease liabilities	\$ 6,668 106	\$ 10,976 163
	\$ 6,774	\$ 11,139

e. Depreciation and amortization

		For the Year Ended December 31
	2024	2023
Property, plant and equipment Right-of-use assets Intangible assets	\$ 41,584 9,205 3,371	\$ 42,663 9,091 2,468
Total	\$ 54,160	\$ 54,222
An analysis of depreciation by function Operating costs Operating expenses	\$ 8,884 41,905	\$ 10,262 41,492
	\$ 50,789	\$ 51,754
An analysis of amortization by function Research and development expenses	\$ 3,371	\$ 2,468

f. Employee benefits expense

		For the Year Ended December 31
	2024	2023
Post-employment benefits Defined contribution plans	\$ 3,939	\$ 3,860
Defined benefit plans Other employee benefits	(20) 3,919 218,642	(21) 3,839 228,064
Total employee benefits expense	\$ 222,561	\$ 231,903
An analysis of employee benefits expense by function Operating expenses	\$ 222,561	\$ 231,903

g. Employees' compensation and remuneration of directors

According to the Company's Articles, the Company accrued employees' compensation at a rate of no less than 0.005% and no higher than 25%, and remuneration of directors and supervisors at rate of no higher than 3%.

The Company had loss before income tax for the year ended December 31, 2024 and 2023. Therefore, no employees' compensation and remuneration of directors was accrued for the relevant period.

If there is a change in the amounts after the annual consolidated financial statements are authorized for issue, the differences are recorded as a change in the accounting estimate.

There is no difference between the actual amounts of employees' compensation and remuneration of directors paid and the amounts recognized in the consolidated financial statements for the years ended December 31, 2022, and 2021.

Information on the employees' compensation and remuneration of directors resolved by the Company's board of directors in 2024 and 2023 is available at the Market Observation Post System website of the Taiwan Stock Exchange.

21. INCOME TAXES

a. Income tax recognized in profit or loss

The major components of tax expense were as follows:

		For the Year Ended December 31
	2024	2023
Current tax
In respect of the current year	\$ 12,162	\$ (1,516)
Income tax on unappropriated earnings	-	5,805
Adjustments for prior years	1,304	726
	13,466	5,015
Deferred tax
In respect of the current year	(11,928)	(66,611)
Income tax expense recognized in profit or loss	\$ 1,538	\$ (61,596)

A reconciliation of accounting profit and income tax expense is as follows:

	For the Year Ended December 31
	2024	2023
Profit before tax from continuing operations	\$ (101,242)	\$ (348,312)
Income tax expense calculated at the statutory rate	\$ (20,322)	\$ (69,627)
Income tax on unappropriated earnings	-	5,805
Nondeductible expenses in determining taxable income	(1,840)	(1,196)
Unrecognized deductible temporary differences	39,436	66,611
Unrecognized loss deductible	-	4,438
Investment credits of the current year	(5,112)	(1,745)
Deferred tax
Temporary differences	(11,928)	(66,611)
Adjustments for prior years' tax	1,304	726
Income tax expense recognized in profit or loss	\$ 1,538	\$ (61,596)

b. Current tax liabilities

	December 31
	2024	2023
Current tax liabilities
Income tax payable	\$ 7,485	\$ 1,129

c. Deferred tax assets and liabilities

The movements of deferred tax assets and deferred tax liabilities were as follows:

For the Year Ended December 31, 2024

	Opening Balance	Recognized in Profit or Loss	Closing Balance
Deferred tax assets
Allowance for impairment loss Foreign exchange loss	\$ 95,516 1,076	\$ 17,728 (1,076)	\$ 113,244 -
	\$ 96,592	\$ 16,652	\$ 113,244
Deferred tax liabilities
Gain on foreign currency exchange	\$ -	\$ 4,724	\$ 4,724
For the Year Ended December 31, 2023
	Opening Balance	Recognized in Profit or Loss	Closing Balance
Deferred tax assets
Allowance for impairment loss Foreign exchange loss	\$ 31,490 -	\$ 64,026 1,076	\$ 95,516 1,076
	\$ 31,490	\$ 65,102	\$ 96,592
Deferred tax liabilities
Gain on foreign currency exchange	\$ 1,509	\$ (1,509)	\$ -

d. Income tax assessments

The Company's tax returns through 2020 have been assessed by the tax authorities.

22. EARNINGS PER SHARE

Unit: NT\$ Per Share

	For the Year Ended December 31
	2024	2023
Basic earnings per share Diluted earnings per share	\$ (1.33) \$ (1.33)	\$ (3.70) \$ (3.70)

The earnings and weighted average number of ordinary shares outstanding used in the computation of earnings per share were as follows:

Net Profit for the Year

	For the Year Ended December 31
	2024	2023
Earnings used in the computation of basic earnings per share Effect of potentially dilutive ordinary shares:	\$ (102,780)	\$ (286,716)
Employee share options	-	-
Bonuses issued to employees	-	-
Earnings used in the computation of diluted earnings per share	\$ (102,780)	\$ (286,716)

Number of shares

Unit: In Thousands of Shares

	For the Year Ended December 31
	2024	2023
Weighted average number of ordinary shares used in the
computation of basic earnings per share	77,466	77,456
Effect of potentially dilutive ordinary shares:
Employee share options	-	-
Bonuses issued to employees	-	-
Weighted average number of ordinary shares used in the
computation of diluted earnings per share	77,466	77,456

The Group may settle the bonuses to employees in cash or shares; therefore, the Company assumes the entire amount of the bonus will be settled in shares, and the resulting potential shares will be included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, if the effect is dilutive. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the shareholders resolve the number of shares to be distributed to employees at their meeting in the following year.

23. SHARE-BASED PAYMENT ARRANGEMENTS

a. Employee share option plan

Qualified employees of the Company were granted 2,000 options on July 29, 2013 and 3,200 options on May 16, 2012, each option entitles the holder to subscribe for one thousand ordinary shares of the Company, and the total number of new ordinary shares required to be issued for the exercise of the employee share option is 2,000 shares and 3,200 shares, respectively. The options granted are valid for 10 years and exercisable at certain percentages after the second year from the grant date.

Qualified employees of the Company were granted 5,000 options on July 22, 2021, each option entitles the holder to subscribe for one thousand ordinary shares of the Company, and the total number of new ordinary shares required to be issued for the exercise of the employee share option is 5,000 shares, respectively. The options granted are valid for 10 years and exercisable at certain percentages after the second year from the grant date.

Information on employee share options is as follows:

		2021 Employee Share Option Plan
	Number of Options (In Thousands)	Weighted average Exercise Price (NT\$)
For the year ended December 31, 2024
Balance at January 1 Options exercised	3,500 (20)	\$ 99.60 -
Balance at December 31	3,480	99.60
Options exercisable, end of the year	1,750	-
For the year ended December 31, 2023
Balance at January 1 Options exercised	3,500 -	\$ 99.60 -
Balance at December 31	3,500	99.60
Options exercisable, end of period	-	-

Information on outstanding options as follows:

	December 31, 2024		December 31, 2023
Share Option Plan		Range of Exercise Price (NT\$)	Weighted average Remaining Contractual Life (In Years)	Share Option Plan		Range of Exercise Price (NT\$)	Weighted average Remaining Contractual Life (In Years)
2021 Employee share option plan	\$	99.60	9.23	2021 Employee share option plan	\$	99.60	10.23

The resolution for the granting of the 2021 employee share options was passed in the board of directors' meeting on July 1, 2021, and their fair values were assessed using the Black-Scholes pricing model; the inputs to the model are as follows:

Grant-date share price (NT\$)	\$ 103.5
Exercise price (NT\$)	\$ 103.5
Expected volatility	43.11%-39.21%
Expected life	2.5-4.5 years
Expected dividend yield		-
Risk-free interest rate	0.79%-0.92%
Fair value of stock options	30.73

Compensation cost recognized were \$22,449 thousand and \$41,536 thousand for the year ended December 31, 2024 and 2023, respectively.

24. CAPITAL MANAGEMENT

The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximizing the return to stakeholders through the optimization of the debt and equity balance.

Key management personnel of the Group review the capital structure on an annual basis. As part of this review, the key management personnel consider the cost of capital and the risks associated with each class of capital. Based on recommendations of the key management personnel, in order to balance the overall capital structure, the Group may adjust the number of new shares issued, and/or the amount of new debt issued or existing debt redeemed.

The Group is not subject to any externally imposed capital requirements.

25. FINANCIAL INSTRUMENTS

a. Fair value of financial instruments that are not measured at fair value

The management believes the carrying amounts of financial assets and financial liabilities not carried at fair value approximate their fair values.

b. Categories of financial instruments

		December 31
		2023
Financial assets
Financial assets at amortized cost (Note 1)	\$	892,451	\$ 1,091,801
Financial liabilities
Amortized cost (Note 2)		163,344	590,962

• Note 1: The balances include financial assets measured at amortized cost, which comprise cash and cash equivalents, accounts receivable, refundable deposits and pledged time deposits.
• Note 2: The balances include financial liabilities measured at amortized cost, which comprise short-term loan, accounts payable, other payables, current portion of long-term borrowing, long-term loan and guarantee deposits.
• c. Financial risk management objectives and policies

The Group's major financial instruments included accounts receivable, accounts payable and long-term borrowings. The Group's corporate treasury function provides services to the business, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Group through internal risk reports that analyze exposures by degree and magnitude of risks. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

1) Market risk

The Group's activities exposed it primarily to the financial risks of changes in foreign currency exchange rates (see (a) below) and interest rates (see (b) below).

There had been no change in the Group's exposure to market risks or the manner in which these risks were managed and measured.

a) Foreign currency risk

The Group has foreign currency sales and purchases, which exposes the Group to foreign currency risk. Approximately 96% of the Group's sales is denominated in currencies other than the functional currency of the entity making the sale, whilst almost 97% of costs is denominated in the entity's functional currency. Exchange rate exposures are managed within approved policy parameters.

The carrying amounts of the Company's foreign currency denominated monetary assets and monetary liabilities are set out in Note 28.

Sensitivity analysis

The Group is mainly exposed to the exchange rate fluctuations in the USD.

The sensitivity analysis regarding foreign currency risk is mainly calculated for USD denominated monetary items on the balance sheet date.

When the NTD appreciates/depreciates by 1% against the USD, the Group's net profit before tax for the years ended December 31, 2024 and 2023 would decrease/increase by \$5,524 thousand and \$6,956 thousand, respectively.

b) Interest rate risk

The Group is exposed to interest rate risk arising from financial assets and financial liabilities at both fixed and floating interest rates.

The carrying amounts of the Group's financial assets and financial liabilities with exposure to interest rates at the end of the reporting periods were as follows.

	December 31
		2024		2023
Fair value interest rate risk
Financial assets		\$ 465,852		\$ 464,124
Cash flow interest rate risk
Financial assets		354,922		574,255
Financial liabilities		50,000		500,000

Sensitivity analysis

The sensitivity analysis regarding interest rate risk is calculated based on the changes in the cash flow of floating-rate liabilities on the balance sheet date. If interest rates had been 0.5% higher/lower, pre-tax profit for the years ended December 31, 2024, and 2023 would have increased/decreased by \$1,525 thousand and \$371 thousand, respectively.

2) Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual obligations and resulting in a financial loss to the Group. As at the end of the reporting period, the Group's maximum exposure to credit risk which will cause a financial loss to the Group due to failure of counterparties to discharge an obligation mainly arise from the carrying amount of the respective recognized financial assets as stated in the consolidated balance sheets.

The Group transacts with a large number of unrelated customers, thus, no concentration of credit risk was observed.

3) Liquidity risk

The Group manages liquidity risk by monitoring and maintaining a level of cash and cash equivalents deemed adequate to finance the Group's operations and mitigate the effects of fluctuations in cash flows. In addition, management monitors the utilization of bank facilities and ensures compliance with loan covenants.

Bank borrowings are significant sources of liquidity for the Group. For the Group's unutilized financing facilities, please refer to (b) Financing facilities below.

a) Liquidity and interest rate risk tables for non-derivative financial liabilities

The following tables detail the Group's remaining contractual maturities for its non-derivative financial liabilities with agreed repayment periods. The tables had been drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Group can be required to pay. The tables include both interest and principal cash flows.

Specifically, bank loans with a repayment on demand clause were included in the earliest time band regardless of the probability of the banks choosing to exercise their rights. The maturity dates for other non-derivative financial liabilities were based on the agreed repayment dates.

	On Demand or Less than 1 Month	1-3 Months		3 Months to 1 Year		1 Year to 5 Years
Non-derivative financial liabilities
Lease liabilities	\$ 596	\$ 838	\$	2,932	\$	4,237
Accounts payable	101,439	7,231		-		-
Payables for purchases of equipment	213	4,461		-		-
Variable interest rate liabilities	92	183		50,366		-
	\$ 102,340	\$ 12,713	\$	53,298	\$	4,237

December 31, 2024

Further information on the maturity analysis of the above financial liabilities was as follows:

	Less than 1 Year			1-5 Years	5-10 Years		10-15 Years		15-20 Years		20+ Years
Lease liabilities Interest rate liabilities	\$	4,366 50,641	\$	4,237 -	\$	- -	\$	- -	\$	- -	\$	- -
	\$	55,007	\$	4,237	\$	-	\$	-	\$	-	\$	-

December 31, 2023

	On Demand or Less than 1 Month	1-3 Months	3 Months to 1 Year	1 Year to 5 Years
Non-derivative financial liabilities
Lease liabilities Accounts payable	\$ 577 71,662	\$ 1,154 16,729	\$ 4,811 -	\$ 963 -
Payables for purchases of equipment Variable interest rate	-	2,571	-	-
liabilities	509	201,017	103,899	202,712
	\$ 72,748	\$ 221,471	\$ 108,710	\$ 203,675

Further information on the maturity analysis of the above financial liabilities was as follows:

	Less than 1 Year	1-5 Years	5-10 Years		10-15 Years		15-20 Years	20+ Years
Lease liabilities Interest rate liabilities	\$ 6,542 305,425	\$ 963 202,712	\$	- -	\$	- -	\$ - -	\$ - -
	\$ 311,967	\$ 203,675	\$	-	\$	-	\$ -	\$ -

b) Financing facilities

		December 31
	2024	2023
Unsecured bank overdraft facilities, reviewed annually and payable on demand: Amount used Amount unused	\$ 50,000 780,000	\$ 500,000 250,000
	\$ 830,000	\$ 750,000
Secured bank overdraft facilities: Amount used Amount unused	\$ - 350,000	\$ - 250,000
	\$ 350,000	\$ 250,000

26. TRANSACTIONS WITH RELATED PARTIES

Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note. Besides information disclosed elsewhere in the other notes, details of transactions between the Group and other related parties are disclosed below.

a. Remuneration of key management personnel

	For the Year Ended December 31
	2024	2023
Short-term employee benefits	\$ 32,980	\$ 37,671

The remuneration of directors and other key management personnel is determined by the remuneration committee based on with individual performance and market trends.

27. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets of the Company were provided as collateral for long-term bank borrowings and as guarantee for the tariff on imported raw materials:

		December 31
	2024	2023
Pledged time deposits (classified as financial assets a amortized cost-noncurrent)	\$ 3,572	\$ 3,549

28. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The Group's significant financial assets and liabilities denominated in foreign currencies aggregated by the foreign currencies other than the functional currencies and the related exchange rates between the foreign currencies and the respective functional currencies were as follows:

December 31, 2024

	Foreign Currency	Exchange Rate	Carrying Amount
Financial assets
Monetary items USD CNY	\$ 20,436 250	32.785 (USD:NTD) 4.478 (CNY:NTD)	\$ 670,018 1,122 \$ 671,140
Financial liabilities
Monetary items USD CNY	3,588 50	32.785 (USD:NTD) 4.478 (CNY:NTD)	\$ 117,632 226 \$ 117,858
December 31, 2023	Foreign Currency	Exchange Rate	Carrying Amount
Financial assets
Monetary items USD CNY	\$ 29,434 300	30.705 (USD:NTD) 4.327 (CNY:NTD)	\$ 903,785 1,299 \$ 905,084 (Continued)

	Foreign Currency	Exchange Rate	Carrying Amount
Financial liabilities
Monetary items USD	\$ 6,781	30.705 (USD:NTD)	\$ 208,202 (Concluded)

The Group is mainly exposed to the USD and CNY. The following information was aggregated by the functional currencies of the entities in the Group, and the exchange rates between the presentation currency and the respective functional currencies were disclosed. The significant unrealized foreign exchange gains (losses) were as follows:

			For the Year Ended December 31
	2024		2023
Foreign Currency	Exchange Rate	Net Foreign Exchange Gains (Losses)	Exchange Rate	Net Foreign Exchange Gains (Losses)
NTD CNY USD	1 (NTD:NTD) 4.454 (CNY:NTD) 32.112 (USD:NTD)	\$ 50,640 712 (1,236)	1 (NTD:NTD) 4.396 (CNY:NTD) 31.155 (USD:NTD)	\$ (1,276) (790) (199)
		\$ 50,116		\$ (2,205)

29. SEPARATELY DISCLOSED ITEMS

• a. Information about significant transactions and investees:
• 1) Financing provided to others: None;
• 2) Endorsements/guarantees provided: None;
• 3) Marketable securities held (excluding investments in subsidiaries): None;
• 4) Marketable securities acquired or disposed of at costs or prices of at least NT\$300 million or 20% of the paid-in capital: None;
• 5) Acquisition of individual real estate at costs of at least NT\$300 million or 20% of the paid-in capital: None;
• 6) Disposal of individual real estate at prices of at least NT\$300 million or 20% of the paid-in capital: See Table 1;
• 7) Total purchases from or sales to related parties of at least NT\$100 million or 20% of the paid-in capital: None;
• 8) Receivables from related parties amounting to at least NT\$100 million or 20% of the paid-in capital: None;
• 9) Information about the derivative instruments transaction: None;

• 10) Intercompany relationships and significant intercompany transactions: See Table 1;

• b. Names, locations, and related information of investees over which the Company exercises significant influence (excluding information on investment in Mainland China): See Table 2.

• c. Information on investments in mainland China: See Table 3.
• d. Information on major shareholders: the name, amount and proportion of shareholders with a shareholding ratio of 5% or more: See Table 4.

30. SEGMENT INFORMATION

a. Operation segment information

Information reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided.

The segment revenues and operating results for the years ended December 31, 2024 and 2023 are shown in the consolidated income statements for the years ended December 31, 2024 and 2023. The segment assets as of December 31, 2024 and 2023 are shown in the consolidated balance sheets as of December 31, 2024 and 2023.

b. Revenue from major products and services

The following is an analysis of the Group's revenue from its major products and services:

		For the Year Ended December 31
	2024	2023
Complementary metal-oxide semiconductors Others	\$ 1,696,261 34,770	\$ 1,644,786 18,713
	\$ 1,731,031	\$ 1,663,499

c. Geographical information

The Group's revenue from continuing operations from external customers by location of operations and information about its non-current assets by location of assets are detailed below.

		Revenue from External Customers
		For the Year Ended	Non-current Assets
		December 31	December 31
	2024	2023	2024	2023
Hong Kong	\$ 1,331,482	\$ 1,223,819	\$ -	\$ -
United States	184,466	91,178	14,003	3,149
India	73,701	47,310	-	-
Taiwan (the Group's operating
location)	70,230	196,707	55,707	36,165
Others	71,152	104,485	9,827	7,274
	\$ 1,731,031	\$ 1,663,499	\$ 79,537	\$ 46,588

Non-current assets exclude financial assets at amortized cost non-current, deferred tax assets, post-employment benefit assets and goodwill.

d. Information about major customers

Single customers contributing 10% or more to the Group's revenue were as follows:

		For the Year Ended December 31
	2024	2023
Customer A Customer B	\$ 649,919 423,670	\$ 540,488 447,376

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT INTERCOMPANY TRANSACTIONS FOR THE YEARS ENDED DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

			Intercom	pany Transactions
		Nature of		2024		Percentage of
Company Name	Counterparty	Relationship (Note 1)	Financial Statement Item	Amount	(Note 2) Terms	Gross Sales or Total Consolidated Total Assets
ptronics, Inc. Silicon O	NUEVA IMAGING INC.	1	pense Technical service ex	54,206 \$	-	3%
	NUEVA IMAGING INC.	1	parties yable from related a p Other	3,626	-	-
	ghai) Co., Ltd. ptronics (Shan Silicon O	1	pense Technical service ex	69,992	-	4%
	ghai) Co., Ltd. ptronics (Shan Silicon O	1	parties yable from related a p Other	4,634	-	-

Note 1: Represents the transactions from parent company to subsidiary.

Note 2: The intercompany transactions, prices and terms are determined in accordance with mutual agreements.

INFORMATION ON INVESTEES DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

	Note	Subsidiary	Subsidiary
	Investment Income	- \$	-
Net Income	Accounted for of Investee using the Method Equity	5,370 \$	3,831
	Carrying Amount	266,568 \$	44,349
Balance as of December 31, 2024	Percentage of Ownership (%)	100	100
	Thousands) Number of Shares (In	6,000	170
Investment Amount	December 31, 2023	358,500 \$	5,237
	December 31, 2024	358,500 \$	5,237
	Main Businesses and Products	Product development & design of ge Sensor gh-end CMOS Ima hi	Investment holding company
	Location	USA	Cayman Islands
	using the Equity Method Investee Accounted for	NUEVA IMAGING INC.	Silicon Optronics (Cayman) Co., Ltd.
	Investor Company	Silicon Optronics, Inc.

INFORMATION ON INVESTMENTS IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

	-
of Investment December 31, Accumulated Repatriation Income as of 2024	\$
December 31, Amount as of Carrying 2024	44,349
	\$
Gain (Loss) Investment	3,831
	\$
Percentage of Ownership of Investment Direct or Indirect (%)	100
(Loss) of the Net Income Investee	3,831
	\$
Remittance for December 31, Accumulated from Taiwan Thousands) Investment Outward (US\$ in as of 2024	thousand) 5,737 175
	(US\$ \$ -
Inward
Remittance of Funds	\$ -
Outward
	\$
Remittance for Accumulated from Taiwan Thousands) Investment January 1, Outward (US\$ in as of 2024	thousand) 5,737 175 (US\$
	\$
Investment Method of	Note 1
Thousands) Capital (US\$ in Paid-in	175 thousand
	US\$
Main Businesses and Products	gy transfer
	development of IC and related consultation on technology Design, test and research and electronic products with services and technolo
Investee Company	Silicon Optronics (Shanghai) Co., Ltd.

Investment Commission, MOEA Upper Limit on the Amount of Investment Stipulated by (US\$ in Thousands)	1,385,296 \$
Investment Amount Authorized by Investment Commission, (US\$ in Thousands) MOEA	Note 1
Remittance for Investment in Accumulated Outward Mainland China as of December 31, 2024 ) (US\$ in Thousands	thousand) 5,737 175 (US\$ \$

Note 1: Through Silicon Optronics (Cayman) Co., Ltd.'s investment in Silicon Optronics (Shanghai) Co., Ltd., the investment was approved by the Investment Commission, MOEA with the approved amount of US\$ 175 thousand.

Note 2: Amount was recognized on the basis of the audited financial statements.

Note 3: Based on the exchange rate as of December 31, 2024.

INFORMATION OF MAJOR SHAREHOLDERS FOR THE YEAR ENDED DECEMBER 31, 2024

		Shares
Name of Major Shareholder	Number of	Percentage of
	Shares	Ownership (%)
Samoa Shangzhao Lake Co., Ltd.	17,691,413	22.83
Egis Technology Inc.	12,353,418	15.94
Samoa Full Guest Investment Limited	4,875,458	6.29
Xiao Dong Luo	4,583,587	5.91

• Note 1: The information of major shareholders presented in this table is provided by the Taiwan Depository & Clearing Corporation based on the number of ordinary shares and preferred shares held by shareholders with ownership of 5% or greater, that have been issued without physical registration (including treasury shares) by the Company as of the last business day for the current quarter. The share capital in the consolidated financial statements may differ from the actual number of shares that have been issued without physical registration because of different preparation basis.
• Note 2: If a shareholder delivers the shareholdings to the trust, the above information will be disclosed by the individual truster who opened the trust account. For shareholders who declare insider shareholdings with ownership greater than 10% in accordance with the Security and Exchange Act, the shareholdings include shares held by shareholders and those delivered to the trust over which shareholders have rights to determine the use of trust property. For information relating to insider shareholding declaration, please refer to Market Observation Post System.