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SYSCOM Annual Report 2022

Jun 16, 2023

52093_rns_2023-06-16_024cecf5-275e-4d6e-9ed9-77b5bc3bacc6.pdf

Annual Report

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Stock Code: 2453

SYSCOM COMPUTER ENGINEERING CO.

2022

Annual Report

Printed on April 15, 2023

Query website for the Annual Report: 1. Market Observation Post System: http://mops.twse.com.tw

  1. The Company's website: http://www.syscom.com.tw

This is a translation of the 2022 annual report (The “annual report”) of Syscom Computer Engineering Co.(The “Company”). This translation is intended for reference only and nothing else, The Company hereby disclaims any and all liabilities whatsoeverfor the translation. The Chinese text of the annual report shall govern any and all matters related to the interpretation of the subject matter stated herein.

  • I. Name, job title and telephone number of the Company's spokesperson: Name: Anthony Tseng Job title: Vice President TEL: (02) 2191-6066 E-Mail ： [email protected]

  • II. Name, job title and telephone number of the Company's acting spokesperson: Name: Chih-Chung Chen Job title: Principal Division Chief TEL: (02) 2191-6066 E-Mail ： [email protected]

  • III. Address and contact number of Head Office and branch offices Head Office: 6th Floor, No. 115, Emei Street, Wanhua District, Taipei City 108 TEL: (02) 2191-6066 Taichung Branch: 11th and 12th Floors, No. 370 and 372, Section 1, Zhongqing Road, North District 404, Taichung City TEL: (04) 2202-1221 Tainan Branch: 13th Floor, No. 395, Section 1, Linsen Road, East District, Tainan City 603 TEL: (06) 200-4321 Kaohsiung Branch: 29th Floor, No. 6, Minquan 2nd Road, Qianzhen District, Kaohsiung City 806 TEL: (07) 330-5501

  • IV. Name, address, website and telephone number of the stock transfer agency: Stock transfer agency: CAPITAL SECURITIES CORP. Address: Basement 2, No. 97, Section 2, Dunhua South Road, Daan District, Taipei City 106 TEL: (02) 2702-3999 Website: www.agency.capital.com.tw

V. Name, firm, address, website and telephone number of the CPAs attesting the financial statements for the most recent years: Name of CPA: Hsin-Wei Tai, Pei-De Chen CPA firm: Deloitte & Touche Address: 20th Floor, No. 100, Songren Road, Taipei City TEL: (02) 2725-9988 Website: www.deloitte.com.tw

  • VI. Name of any exchanges where the Company's securities are listed offshore, and the method by which to access information on the offshore securities: Not applicable.

  • VII. The Company's website : http://www.syscom.com.tw

Table of Contents

Table of Contents
Page
One. Letter to Shareholders ....................................................................................... 1
Two. Company Profile .............................................................................................. 5
I. Date of Establishment ............................................................................. 5
II. Company History .................................................................................... 5
Three. Corporate Governance Report ..................................................................... 10
I. Organizational System .......................................................................... 10
II. Information on Directors, President, vice president, assistant VP, heads
of departments and branches ................................................................. 13
III. Remuneration paid to directors (including independent directors),
president and vice president for the most recent fiscal year ................. 28
IV. Operations of corporate governance ..................................................... 37
V. Information on CPA professional fees .................................................. 79
VI. Information on Replacement of CPAs .................................................. 80
VII. Any of The Company’s Chairman, President, or managerial officers
involved in financial or accounting affairs being employed by the
auditor’s firm or any of its affiliated company within the recent year . 80
VIII. Changes in transfer and pledge of shares by directors, managerial officers
and shareholders with more than 10% shareholding in the most recent
year up till the date of publication of this Annual Report..................... 80
IX. Information on the relationship among the top 10 shareholders if anyone
is a related party, a spouse or a relative within second degree of kinship
of another .............................................................................................. 84
X. The total number of shares and the consolidated equity stake percentage
held in any single reinvested enterprise by the Company, its directors,
managerial officers, or any companies controlled either directly or
indirectly by the Company .................................................................... 85
Four. Fund raising.................................................................................................... 86
I. Capital and stock ................................................................................... 86
II. Issuance of Issuance of Corporate Bonds ............................................. 89
III. Issuance of preferred shares .................................................................. 89
IV. Issuance of Global Depositary Receipts ............................................... 89
V. Employee Share Subscription Warrants ................................................ 89
VI. New Restricted Employee Shares ......................................................... 89
VII. Issuance of new shares in connection with mergers or acquisitions of
shares of other companies ..................................................................... 89
VIII. Capital utilization plan and implementation status ............................... 90
Five. Operations overview ...................................................................................... 91
I. Business activities ................................................................................. 91
II. Market, production and sales overview .............................................. 104
III. Information on employees .................................................................. 110
IV. Information on environmental protection expenditures ..................... 110
V. Labor relations .................................................................................... 110
VI. Cyber security management ................................................................ 113
VII. Important contracts ............................................................................. 115
Six. Financial position ........................................................................................... 116
I. Condensed Balance Sheets and Statements of Comprehensive Income for
the most recent 5 years ........................................................................ 116
II. Financial analysis for the most recent 5 years .................................... 120
III. Audit Committee’s review reports on the financial statements for the
most recent year .................................................................................. 124
IV. Financial statements for the most recent year ..................................... 125
V. Parent company only financial statements for the most recent years
audited and attested by CPAs .............................................................. 175
VI. If the Company or its affiliates have experienced financial difficulties in
the most recent year or during the current year up to the date of
publication of the Annual Report, their effects on the Company’s
financial position should be stated ...................................................... 221
Seven. Review and analysis of financial position and financial performance and
risks ..................................................................................................... 222
I. Financial Status ................................................................................... 222
II. financial performance ......................................................................... 223
III. Analysis of Cash Flow ........................................................................ 224
IV. Major Capital Expenditure Items and Source of Capital .................... 224
V. Investment Policy in the Last Year, Main Causes for Profits or Losses,
Improvement Plans, and Investment Plans for the Coming Year ....... 224
VI. Analysis of Risk Management ............................................................ 225
VII. Other material matters ......................................................................... 228
Eight. Special matters ............................................................................................ 229
I. Information about the Company’s Affiliates ...................................... 229
II. Private Placement Securities in the Most Recent Years ..................... 232
III. Shares in the Company Held or Disposed of by Subsidiaries in the Most
Recent Years. ....................................................................................... 232
IV. Other supplementary information. ...................................................... 232
V. Any of the situations listed in Article 36, paragraph 3, subparagraph 2 of
the Securities and Exchange Act, which might materially affect
shareholders' equity or the price of the company's securities, has occurred
during the most recent fiscal year or during the current fiscal year up to
the date of publication of the annual report ........................................ 232

One. Letter to Shareholders

Dear shareholders:

As the pandemic eases and restrictions are lifted gradually, countries around the world are looking forward to an accelerated economic turnaround. However, supply chain imbalances, labor shortages, and rising inflationary pressures accompanying the changes in the pandemic and economic recovery are driving the world toward a new normal. SYSCOM COMPUTER is a leading computer system integrator in Taiwan with outstanding solutions in productivity improvement, zero-touch economy, information security, and green energy sustainable IT, and has been selected as a CIO TAIWAN 2022 "Outstanding Service Provider" with the support of its customers for its outstanding technical capabilities and service capabilities. Despite the fact that major domestic and international institutions generally believe that economic momentum is slowing down, SYSCOM COMPUTER, with the concerted efforts of all employees, has continued to build up its competitive strength and provide high-quality services to customers, maintaining steady growth in both revenue and profit for 2022.

An overview of our operations for 2022 and the outlook for 2023 are hereby reported:

I. 2022 Business Report

  1. Business plan implementation results:

The Company's consolidated net operating revenues for 2022 were NT$ 5,950,524 thousand, up 1.38% over 2021, and consolidated net profit after tax was NT$ 244,945 thousand, up 13.94% over 2021.

2. 2022 budget implementation status:

The Company did not prepare and announce the financial forecast for 2022, and the consolidated profit or loss for 2022 is hereby presented as follows:

Unit: Thousands of NTD

Unit: Thousands of NTD
Item Actual amount
Net operating revenue 5,950,524
Operating costs 4,432,024
Gross profit 1,518,500
Operating expenses 1,254,095
Operating profit 264,405
Non-operating income and
expenses		 40,251
Net profit before tax 304,656
Net profit for the year (after tax) 244,945

1

  1. Analysis of financial receipts and expenditures and profitability for 2022:
Unit: Thousands of NTD Unit: Thousands of NTD
Item 2022 2021
Net operating revenue 5,950,524 5,869,595
Profit or loss after tax 244,945 214,977
Return on assets (%) 5.80 5.14
Return on shareholders’equity (%) 12.16 11.11
Net profit before tax as a percentage of
paid-in capital (%)		 30.47 27.19
Net profit margin (after tax) 4.12 3.66
Earnings per share (NTD) 2.51 2.16

Note: The above financial data was calculated based on the consolidated financial statements

  1. Research and development status:

  2. (1) Technologies and products successfully developed:

  3. DBMaster DataBase

  4. DBMaker CloudDB

  5. DBMaker BigData DB

  6. RFID Intelligent Traffic and Transportation Platform

  7. Health Examination Management System

  8. Mobile Point of Sale

  9. Azure CSP Intelligent Cloud Management System

  10. (NMS/EMS) NDS (Netwrok Dimenstion System) Advanced Module - SDN Network Management Module

  11. CMMI Software Development Process Solution – SDPM

  12. Software Productivity Recursive Performance Prediction Model

  13. Next Generation Healthcare Information Syscom

  14. Futures Risk Control Rapid Mid-End System

  15. Securities Risk Control Rapid Mid-End System

  16. NCBS

  17. New Generation Securities and Futures Trading System

  18. NTD deposit, foreign exchange and trust account opening and e-form system

  19. Mobile Payment System

  20. NETCenter

  21. GreenMaker

  22. Cloud-Based Cross-Border Project Management Service

  23. Energy Diagnosis Management System

  24. Electricity Load Dispatching For Union Demand Response

  25. Security Information Service Platform/Diamond Guard

  26. SASP Service Platform (SYSCOM Applications Service Portal) and My Note 3.2.

  27. Intelligent Analysis and Decision Support System

  28. Real-time satellite image reception and processing

  29. Patrol box electronic

  30. VIAMaster

  31. SERVICE Online

  32. Technical Service Management (TSM)

  33. OMFLOW

  34. Hyper Automation Log Archiving Management System

  35. SECURITY USER INTERFACE PROGRAM

  36. Visa Direct, Mastercard Cross-border, Cross-border Payment Transaction management system

  37. (2) Future research and development directions (including ongoing projects).

  38. Secure Terminal Emulator – DRSE

  39. AYUDA

  40. DBMaker Docker Image

  41. Opus One IP Continuous Configuration Management Platform

  42. Shopping mall service robots

  43. Anti-pandemic service robots

  44. OMFLOW Continuous Configuration Automation module

  45. Hyper Automation Scanning Task Framework

2

II. Outline of 2023 Business Plan

  • 1.Management Policy:

  • (1) Unleash the power of systems to create a high-quality customer service experience.

  • (2) Innovate technologies and services and integrate industrial applications to accelerate adoption.

  • (3) Drive R&D capacity and enhance core product applications.

  • (4) Strengthen international collaboration and enhance competitive advantages in overseas markets.

  • (5) Strengthen management performance and strive for ESG corporate sustainable development.

  • 2.Important production and marketing policies:

  • (1) Carry through the standard operating process and adhere to the commitment of total quality excellence and sustainability.

  • (2) Innovate industry-related information services to improve overall profitability.

  • (3) Dedicate to core products and professional services and develop applications in multiple fields.

  • (4) Develop new technologies such as AI, 5G, cloud, Internet of Things, and information security.

  • (5) Form alliances with Taiwan hardware and software vendors to expand domestic and overseas markets.

III. Impacts by the external competitive environment, regulatory environment and general economic environment

Recently, the economic situation is affected by the mutated virus, the war between Russia and Ukraine, high inflation and climate change, etc. Major economies have started a cycle of interest rate increases to combat inflation, and high interest rates have affected corporate investment intentions. The Taiwan Institute of Economic Research (TIER) observed that the weakening global economic demand has affected the performance of Taiwan's foreign trade, and the growth of private investment has slowed down significantly.Fortunately, the government's public construction budget is at a record high, and private consumption remains strong, so both the private sector and the government will work together to support Taiwan’s economy, and the domestic economic growth rate is forecasted to be 2.58% for 2023.

With the rapid changes in the global market, the rise of the digital transformation and the shift of paradigms, how to guide the industry to develop cross-domain software application services in response to the market demand and follow the government's innovative industrial policies to enhance the competitiveness of Taiwan's information service and software industries is indeed an important challenge for the development of the industry. Under this trend, many industries are gradually evolving along the direction of smart manufacturing, smart medical care, and smart retail, and emerging technologies such as cloud computing, artificial intelligence, and information security are highly valued by enterprises whereas information software and service providers are key players in facilitating the adoption of these emerging technologies.

IDC's forecast of the top 10 trends in Taiwan's ICT market for 2023 indicates that as the industries have entered the as a service economic structure, it is increasingly important to optimize operations and develop innovative digital businesses. Investments in technologies and IT will be the main driving force for enterprises to sustain economic shocks and develop their digital businesses. The top 10 trends include:

  • (1) Digital Sovereignty.

  • (2) Acceleration of automation applications and implementation of multimodal AI adoption.

  • (3) The next wave of network security revolution - software traceability.

  • (4) Supply chain restructuring and new competition.

  • (5) Geopolitics accelerates the development of low-orbiting satellites.

  • (6) The Multiverse is moving toward the trend where the big ones get bigger.

  • (7) Multivariate and multi-stage adoption of digital twin.

  • (8) The post-pandemic economy accelerates the cloud transformation of SMEs and information service providers.

  • (9) Formation of future consumers.

3

  • (10) The change of payment method under the wave of digital population drives the development of B2C industry.

IV. The Company's future development strategy

  1. Short-term development plan

  2. (1) Integrate various system management tools to continuously improve efficiency and quality.

  3. (2) Expand sales of core products and services to increase overall profitability.

  4. (3) Integrate 5G, AIoT, information security, big data and cloud technologies to develop a data economy.

  5. (4) Develop transportation, security and business applications with intelligent operating platforms.

  6. (5) Form alliances with outstanding domestic vendors to enter the emerging application market.

  7. Long-term development plan

  8. (1) Implement the commitment of continuous improvement of total quality and strive for sustainable development of ESG.

  9. (2) Demonstrate strong system capabilities in software and hardware integration to help enterprises transform digitally.

  10. (3) Bridge advanced technology and application to life, and joining hands with Taiwan team to enter the World Cup.

Regarding the outlook for 2023, the global economy will continue to face geopolitics, financial volatility, climate anomalies, and global supply chain issues. In the face of slowing economic growth, companies need to accelerate innovation and develop better technology solutions. Despite the high uncertainty of private investment, there are still many IT installations that are in immediate demand, such as information security, cloud deployment, and regulatory compliance, which will be the main drivers of growth for information service providers in 2023. As one of the largest and most influential system integration companies in Taiwan, SYSCOM COMPUTER is committed to completing every project with dedication, focus, and commitment, helping customers to promote digital transformation and build a resilient enterprise, and continue to strive for opportunities to create new business opportunities. Finally, I wish all shareholders good health and all the best to you.

Chairman: Jui-Fu Liu

4

Two. Company Profile

I. Date of Establishment: July 17, 1975.

II. Company History:

  1. For the most recent year and the current year up to the date of publication of the Annual Report, mergers and acquisitions, investments in affiliates, reorganizations, significant transfers or changes in shareholding of directors or major shareholders with 10% of the stake or more, changes in management right, significant changes in the mode of operations or business scope, and other events of sufficient importance to affect shareholders' equity and their effects on the Company: None.

  2. Important Milestones:

  3. Year Important Milestones 1975  The Company was established to provide professional computer services. Initially, we were mainly a distributor of domestic and foreign computer peripherals, and our longterm goal was to “provide one-stop complete solutions”.

  4. 1978  Introduced the T.I. computer system produced by Texas Instruments.

  5. 1979  Established the Project Management Department to design complete application systems for customers, providing them with solutions from hardware to software, and formally entered the professional field of system integration.

  6. 1981  Set up the Taichung Branch.

    • Served as a distributor for AOL’s Tandem NonStop Computer System, a leading OLTP NonStop computer system, bringing the connected operating system to a new level of non-stop for hardware/software/maintenance.

  7. 1982  Taiwan Stock Exchange outsourced its computerization operations to SYSCOM, layering a good foundation for future success in the securities computerization market.

    • Set up the Kaohsiung Branch.

  8. 1983  Developed the "Bank Management Information System" for the SME banks in Hsinchu District, and penetrated into the financial industry for the first time.

  9. 1985  National Cheng Kung University Medical Center used the hospital automation services provided by SYSCOM COMPUTER.

  10. 1988  CKS Airport Air Cargo Terminal used SYSCOM COMPUTER’s products to automate its operations.

  11. 1989  Set up branch and rep office in Tainan and Taoyuan respectively.

    • As the stock market was booming, nearly 60 securities dealers adopted SYSCOM's securities automation system, establishing SYSCOM's leading position in Taiwan's securities computerization market.

  12. 1990  Independently developed SYSCOM APG, which became an Alliance Product licensed by the internationally renowned Tandem Computers.

  13. 1991  Invested in CASEMaker Inc. in the U.S., which specialized in the global marketing of software tools and database products.

  14. 1992  SYSCOM COMPUTER introduced CISCO network products, which were used by more than ten universities in Taiwan.

    • The tender project of the Ministry of Finance's customs clearance automation.

  15. 1993  Set up Hsinchu rep office, gradually forming a province-wide service network.

    • Received "Outstanding Information Software Award" from the Ministry of Economic Affairs.

  16. 1994  The outsourcing project for the Health Information Network of the Ministry of Health, Executive Yuan - North Kaohsiung Medical Regional Information Exchange Center, in charge of the operations of the computerized online reporting for the national health insurance medical benefits.

  17. 1995  Mr. Jui-Fu Liu, Chairman of the Board of Directors, was elected as the Chairman of the 8th Taipei Computer Association.

5

  • Year Important Milestones 1996  Won the first place in the education and training category of the customer satisfaction survey conducted by the Directorate-General of Budget, Accounting and Statistics for four consecutive years from 1993 to 1996.

  • Passed ISO 9002 quality certification.

  • Selected to participate in the "Ground Control System" outsourcing service of "FORMOSAT-1" by National Science and Technology Council to implement aerospace technology transfer to Taiwan.

  • 1997  Launched DBMaker, the first large-scale database developed by Taiwan nationals.

  • Developed LegacyAid, an analysis tool to solve the year 2000 information crisis.

  • Awarded Best Network Integration Company in Asia Taiwan by Data Communications Magazine in 1996 and 1997.

  • Passed the management system evaluation of the Ministry of Economic Affairs' private business technology projects.

  • 1998  Received the "Superior Award for Industrial Technology Development" from the Ministry of Economic Affairs.

  • Set up a subsidiary in Thailand.

  • Mr. Jui-Fu Liu, Chairman of the Board of Directors, was re-elected as the Chairman of the 9th Taipei Computer Association.

  • Taiwan Futures Exchange used SYSCOM COMPUTER's computerized services. showing that SYSCOM had the capability to build information systems for the three major financial exchanges (TWSE/TPEx/TAIFEX) in Taiwan.

  • ISPs such as Hinet, Seednet, and GigaMedia used SYSCOM's planning and integration services.

  • Launched "SYSCOM’s securities integration information system - TradeMaker™", kicking off the trend of online order placement in the securities industry.

  • 1999  FORMOSAT-1 was successfully launched and SYSCOM COMPUTER "Ground Control System and Satellite Operations and Maintenance" officially started operations.

  • Introduced Nuance voice recognition technology to develop Chinese voice recognition system, opening new business opportunities for domestic e-commerce market.

  • SYSCOM was ranked second in overall performance in the "Service Quality Assessment of Large Financial Information System Providers by BAROC".

  • Passed Cisco's rigorous evaluation and technical requirements and became the first “Gold Certified Partner” in Taiwan.

  • 2000 ⚫ Passed ISO 9001 quality certification.

  • ⚫ Passed the high-tech business audit by the Industrial Development Bureau, Ministry of Economic Affairs.

  • Won the "Outstanding Information Application and Product Award of 2000 Information Month" for the "Criminal Crime Database System" jointly completed with the Criminal Police Division.

  • 2001  SYSCOM COMPUTER was successfully listed on TWSE.

  • Subsidiary Syscom Computer(Shenzhen)Co., Ltd. won the businesses for the establishment of trading platforms for Shanghai and Shenzhen Stock Exchange.

  • 2002  Participated in the construction of backbone and retrieval network equipment for the second generation GSN government service network.

  • ⚫ [SYSCOM Form Approval System] complied with the "Basic Standards for Form Approval Process Automation in Government Agencies" and was one of the first software products to be approved by the Research, Development and Evaluation Commission, Executive Yuan.

  • 2003  Built “NCBS”, entering the financial holding market.

  • Developed voice application successfully - launch of the voice reporting system of Customs Administration, Ministry of Finance.

  • Launched the "Video Conferencing Solution" in the wake of the SARS storm.

  • SYSCOM COMPUTER and TÜVIT, a European information security certification agency, formed a strategic alliance to provide comprehensive information security consulting services.

  • Won the business of the "Common Operating Platform Construction and Continuous Configuration Outsourcing Service" for e-Government.

6

Important Milestones

  • Year Important Milestones 2004  Received the "Certificate of Registration as a Technological Service Organization" from the Industrial Development Bureau, Ministry of Economic Affairs.

  • SYSCOM became the first "Microsoft Gold Certified Partner" with successful project services and more than 100 professional technical certified engineers.

  • For the launch of FORMASAT-2, the Formosa Satellite mission team that SYSCOM participated officially started operations.

  • Directly took on and passed CMMI Level 3 evaluation and officially announced to try to directly pass CMMI Level 5 evaluation.

  • Became the first domestic vendor to win "2004 Microsoft "Advanced Infrastructure Award" Winner".

  • 2005  Became one of the top three flagship vendors in Taiwan by passing the examination of the BEST program of the Ministry of Economic Affairs.

  • Subsidiary Xian Linan Computer passed the CMMI Level 3 evaluation.

  • 2006[][Received the "2005 MIS BEST CHOICE" award from the Institute for Information ] Industry:

    • First place in the category of SI System Integration Services.

    • Second place in the category of OutSourcing Information Outsourcing Services

    • First place in the category of Network Construction and Planning Services

    • Third place in the category of Information Security Infrastructure Services

  • Passed ISO27001 (BS7799) Information Security Certification.

  • Awarded the "Best Partner for Information Security" by BSI Taiwan.

  • Formosat 3 was officially launched and SYSCOM’s ground operation system officially started operations.

  • Successfully took on the CMMI Level 5 international software quality evaluation by skipping several levels and became the first vendor in Taiwan to pass CMMI Level 5.

  • 2008[][President Jui-Long Liu was elected as the 11th President of Information Service Industry ] Association of R.O.C.

  • With the most Fortinet certified engineers in Taiwan, and passed the review. Became the first highest-level "Gold Partner" of Fortinet in Taiwan for the first time.

  • Became the first highest-level vmware partner for outstanding sales and technical certified engineers.

  • 2009[][Awarded the "Best Marketing Campaign Partner" by the Institute for Information ] Industry.

  • 2010[][Collaborated with Japan TSH by outsourcing and released Japan's first enterprise cloud ] computing service "MMS+ CLOUD", transplanting proprietary software assets to the cloud environment. The strength of SYSCOM software has been reaffirmed.

  • Joined the "Cloud Computing and IoT Association in Taiwan" and jointly strive for global cloud computing business opportunities.

  • 2011[][Passed CMMI-Dve v1.2 Maturity Level 5 evaluation. ]

  • President Jui-Long Liu was re-elected as the 12th President of Information Service Industry Association of R.O.C.

  • 2012[][Implemented for the first time for the whole company and passed the certification of ] "Personal Data Security Management PIMS BS10012:2009".

  • Released NonStop NCBS with HP to help financial users reduce costs significantly.

  • Received the “2012 National Excellence Award for Microsoft Partner of the Year”.

  • Recognized for the “Syscom Cyberhood Cloud Service Platform by the “2012 Cloud Innovation Award”.

  • 2013[][Subsidiary Syscom Computer(Shenzhen)Co., Ltd. passed the "Computer Information ] System Integration Level 3 Qualification" certification at the national level in China.

  • Established “Cloudmaster Co., Ltd.” by joint venture with TOKAI Communications, Japan.

  • Independently developed the product "DBMaker Database" and won the "Taiwan Excellence Award" for the first time.

7

  • Year Important Milestones 2014[][Awarded by the Ministry of Economic Affairs for the second "Taiwan Mittelstand ] Enterprise".

  • Subsidiary Syscom Computer (Shenzhen)Co., Ltd. was awarded "AA Grade Credit Enterprise in Enterprise Credit Rating" by China Software Industry Association.

  • Passed CMMI v1.3(Staged) Maturity Level 3 evaluation.

  • SYSCOM's "DBMaker CloudDB" won the "2015 Taiwan Excellence Award" again.

  • Won the champion of "2014Cloud Innovation Competition - Domestic Cloud Data Center Solution Category".

  • 2016[][Won the "2016 System Integration Output Award" with "Enterprise Dedicated Cloud ] Server Room Hosting Services - Pracla".

  • Received "Personal Data Management System BS 10012:2009 Certification".

  • Subsidiary Syscom Computer (Shenzhen)Co., Ltd. assisted Shanghai Pudong Development Bank to win the "Asian Banker - Best Mobile Banking Security Award " in 2016.

  • The "Enterprise Dedicated Cloud Server Room Hosting Services - Pracla" won the "2016 Cloud Gold Award" in the annual evaluation of "Cloud Industry Service Corps" by Industrial Development Bureau, Ministry of Economic Affairs.

  • SYSCOM, Cloudmaster, and other vendors jointly developed "OpenStack Pracla", which was awarded the third place in "2016 Cloud IoT Innovation Award".

  • Participated in the development of Police Cloud and Environmental Cloud, and both won the "2016 Cloud IoT Innovation Award - Outstanding Application Award in Government Application Category".

  • The "m-Police Mobile Computer System" developed in collaboration with the National Police Agency was selected as one of the "Top 100 Innovative Products of 2016 Information Month - Public Service Products"..

  • Passed the dual certification of information services and information security with three certification contents, including: ISO/IEC 20000-1:2011, ISO/IEC 27001:2013 and CNS 27001:2014.

  • 2017[][Subsidiary Syscom Computer (Shenzhen)Co., Ltd. was awarded the "Best Supplier ] 2016" by China Merchants Bank and recognized as a "High-tech Enterprise" (2012, 2015 and 2017) at the national level in China again.

  • SYSCOM's "Relational Database Core Engine - DBMaker" received "2017 Taiwan Excellence Award".

  • Passed CMMI-Dev v1.3 Maturity Level 3 evaluation.

  • Passed BS10012:2009 certification for personal data security.

  • Cloud Robot - Ayuda won the champion of "2017 Cloud IoT Innovation Award".

  • Passed the dual certification of information services and information security with three certification contents: CNS 27001:2014/ISO/IEC 20000-1:2011/ISO/IEC 27001:2013.

  • 2018[][Awarded "The 25th National Quality Award - Exemplary Manufacturing Quality ] Award".

  • SYSCOM Cloud Robot - Ayuda Intelligent Platform received the [2018 System Integration Output Award].

  • Passed the dual certification of information services and personal data security: ISO/IEC 20000:2011 and ISO/IEC 27001:2013 and national personal data security certification: CNS 27001:2014.

  • 2019[][SYSCOM's self-developed "DBMaker CloudDB" won the "2020 Taiwan Excellence ] Award" again.

  • 2020[][Passed the dual certification of information services and information security: ISO/IEC ] 20000 (2015-2021) and ISO/IEC 27001 (2015-2021).

  • Mr. Jui-Fu Liu, Chairman of the Board of Directors, was awarded the "2019 Annual Fellowship Award" by CSROC.

  • Listed as one of the representative vendors of Taiwan's industrial development in the 50th anniversary book of Industrial Development Bureau, Ministry of Economic Affairs.

  • Awarded the SGS "2020 Information Security Management Excellence Award".

  • The self-developed product "Intelligent Service Robot AYUDA" was awarded "2021 Taiwan Excellence Award and Taiwan Excellence Silver Award".

  • The self-developed product "NETCenter" received the "2021 Taiwan Excellence Award".

8

Important Milestones

  • Year Important Milestones 2021[][Mr. Jui-Fu Liu, Chairman of the Board of Directors, was awarded "Honorary Doctor of ] Engineering" by National Dong Hwa University.

  • Passed Cisco's rigorous evaluation and technical requirements and was awarded again CISCO’s highest-level “Gold Certified Partner” (1999-2021).

  • Repeatedly honored with the “Microsoft Gold Certified Partner” certification (20042021) with successful project services and more than 100 professional certified engineers.

  • Repeatedly honored with the highest-level Fortinet and vmware partner for outstanding sales and technical certified engineers (2008-2021).

  • With 40 years of irreplaceable NonStop system sales and technical expertise, combined with outstanding HPE product sales performance and technical certified engineers, becoming the highest-level HPE solution sales partner.

  • Independently developed the product "DBMaker Database" and won repeatedly the "Taiwan Excellence Award" (2013, 2014, 2015, 2017, 2020, 2021, and 2022)

  • The self-developed product "NETCenter" received the "Taiwan Excellence Award" two years in a row in 2021 and 2022.

  • Passed the dual certification of information services and information security: “ISO/IEC 20000(2015-2021) and ISO/IEC 27001 (2015-2021)”.

  • Implemented and passed the certification of Personal Data Security Management PIMS BS10012 (2012-2021).

  • Passed “ISO27701 Privacy Information Management Certification”, becoming the first SI vendor in Taiwan to have four international standard certifications for privacy, information security, information services and personal data at the same time.

  • 2022[][Independently developed the product "DBMaker Database" and won the "Taiwan ] Excellence Award" time after time (2013, 2014, 2015, 2017, 2020, 2021 2022 and 2023).

  • The self-developed product "NETCenter IT Infra Network Monitoring and Management Center" continued to receive "Taiwan Excellence Award” (2021, 2022, and 2023).

  • The self-developed product "Intelligent Service Robot Ayuda" won "Taiwan Excellence Award”(2021 Taiwan Excellence Silver Award and 2023 Taiwan Excellence Award).

  • The self-developed product "OMFLOW Enterprise Process Engine" received "Taiwan Excellence Award" (2023) for the first time.

  • Passed the dual certification of information services and information security: “ISO/IEC 27001:2013 (2020-2023)” and “CNS 27001:2014 (2021-2023)”.

  • Passed the “BS 10012:2017 certification (2022-2025) for personal data security management, privacy information management“ISO/IEC 27701:2019 certification (2022-2025)”.

  • Awarded "Service Innovation Award First Prize" by the Ministry of Transportation and Communications (MOTC) under the "5G-driven Smart Transportation Technology and Service Innovation and Industry Development Subsidry Program".

  • More than once, awarded the highest-level “Gold Certified Partner” by Cisco, the world's largest network equipment vendor, for 23 years (1999-2022).

  • Cisco Taiwan "Best Partner in Software Business".

  • MicroFocus "Most Dedicated Customer" and "Best Achievement Award".

  • HPE "Best Customer Satisfaction Award", "Best Reseller Partner" and "Best Licensed Service Provider Award”.

  • Awarded CIO TAIWAN 2022 "Outstanding Service Provider".

  • SYSCOM received the "System Innovation Award" from the 9th Cloud Leopard Incubation Program for mentoring a new start-up company, MyelinTek Inc.

  • 2023[][Continue to grow ]

9

Three. Corporate Governance Report

  • I. Organizational system

  • (I) Organization chart

==> picture [349 x 650] intentionally omitted <==

10

(II)Businesses of each major department

Major department Businesses
President Responsible for the planning and integration of the company's long-term and
short-term operational direction and decisions.
Finance and International
Business Group		 Provide sale and planning of hardware and software equipment system
integration for financial customers, as well as sales, design and construction
services for network-related products.
Telecommunication Services
Business Group		 Provide system integration of telecommunication networks and value-added
application services, sales and solutions for information and communications
as a whole, and provide consulting and software development services for
information and communications equipment-related products.
Telecommunications Business
Group		 Provide sale and planning of hardware and software equipment system
integration for telecommunications customers, as well as sales, design and
construction services for related products.
Public Services Systems
Business Group		 Provide sale and planning of hardware and software equipment system
integration for government and school customers, as well as sales, design and
construction services for network-related products.
Corporate Services Business
Group		 Provide sales, planning, establishment and maintenance services of hardware
and software equipment system integration for corporate and financial
customers, as well as sales, design and construction services for related
products.
Financial Holding Systems
Business Group		 Provide sale and planning of hardware and software equipment system
integration for customers in the securities/futures/general corporate fields
under financial holding, as well as sales and design services for network-
related products.
Marketing and Product
Marketing Business Group		 Responsible for formulating marketing strategies, product strategies, product
pricing and sales of the company's products.
Customer Services Business
Group		 Provide sale and planning of hardware and software equipment system
integration for customers in the securities/futures/regional finance/general
corporate fields, as well as sales, design and construction services for
network-related products.
Software Business Group Responsible for the sales of software applications with software
tools/platforms as the core.
R&D Center Responsible for the research and development of software tools, etc. and the
preparation and execution of research and development plans.
Technology Center Provide internal technical support and support, maintenance and technical
consultation services for hardware and software computer equipment to
customers.
Marketing Division Responsible for business system planning, execution, evaluation, and industry
strategy research.
Administration Principal
Division		 Responsible for human resources, treasury, accounting, general affairs, and
management analysis.
Audit Office Responsible for auditing the implementation of internal control systems for
business,finance and operations ofeachunit.

11

  • (III) Sustainable Development Promotion Group

  • Organization chart:

==> picture [409 x 234] intentionally omitted <==

In 2022, the Board of Directors of the Company approved the renaming of the former Corporate Governance and CSR Promotion Group to the Sustainable Development Promotion Group, with the President as the convener and the Vice Convener coordinating the three subgroups, including Corporate Governance, Environmental Sustainability and Social Co-prosperity, responsible for the formulation of policies, systems or management policies related to sustainable development and the formulation of specific promotion plans, implementation and review of the effectiveness of implementation and regularly reports the implementation plans and results to the Board of Directors at least once a year. The Board of Directors reviews the implementation of strategies and promotion of plans based on the implementation reports, and instructs the Promotion Group to make adjustments when necessary. The main tasks are divided into the following three subgroups and the relevant departments are responsible for promoting the implementation:

  • (1) Corporate Governance Subgroup:

Responsible for compliance with laws and regulations, Board of Directors' governance practices, implementation of internal control system, information security, information disclosure, risk management, shareholders' rights and interests, and other related work.

  • (2) Environmental Sustainability Subgroup: Responsible for environmental protection, green environment, energy saving and carbon reduction, ecological sustainability, greenhouse gas inventory, and safety and health related work.

  • (3) Social Co-prosperity Subgroup:

    • Responsible for employee care, customer relations, supplier management, workplace safety, education and training, integrity management, human rights protection, and social benefit.

  • The implementation results for 2022 and the plan for 2023 were reported to the Board of Directors on December 15, 2022.

12

II. Information on directors, president, vice president, assistant VP, heads of departments and branches

(I) Information on directors

(I) Information on directors (I) Information on directors (I) Information on directors (I) Information on directors (I) Information on directors (I) Information on directors
As of April 15,2023
Job title Nationality
or place of
registration

Name		 Gender and
age		 Date elected Terms
of
office		 Date first
elected		 Shareholding when elected Shareholding now Shareholding of spouse and
minor children now		 Shareholding in the
name of others		 Major experience (education) Concurrent
positions
in the
Company
and other
companies
now
Spouse or relatives within second
degree of kinship who are officers,
directors or supervisors of the
Company		 Remark
(Note 6)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage		 Number of
shares		 Shareholding
percentage		 Number
of
shares		 Shareholding
percentage		 Job title Name Relationship
Chairman R.O.C. Jui-Fu
Liu		 Male
71~80 years
old		 2021.07.29 3
years		 1980.10.25 18,346,787
18.35
18,346,787
18.35
8,432,001
8.43
0
0		 Department of Electrical
Engineering, National Cheng
Kung University
Honorary Doctorate, National
Dong Hwa University
Chairman of the Taipei Computer
Association		 Note 1 Director
Director		 Jui-Long
Liu
Chih-Chun
Liu		 Bothers
Father and
daughter		 -
Director R.O.C. Jui-Long
Liu		 Male
61~70 years
old		 2021.07.29 3
years		 1986.12.08 402,562
0.40
402,562
0.40
0
0
0
0		 Institute of Management Science,
National Chiao Tung University
Lecturer of Tamkang University
President of Information Service
IndustryAssociation of R.O.C.		 Note 2 Chairman Jui-Fu Liu Bothers -
Director R.O.C. Po-Wen
Wang		 Male
71~80 years
old		 2021.07.29 3
years		 2008.06.13 0
0
0
0
0
0
0
0		 Department of Science and
Management, Graduate Institute
of Business Administration,
National Chengchi University
Deputy Director of Engineering
Development Office, National
Chung-Shan Institute of Science
& Technology		 None None None None -
Director R.O.C. Chih-
Chun Liu		 Female
41~50 years
old		 2021.07.29 3
years		 2021.07.29 3,187,689
3.19
4,375,567
4.38
0
0
0
0		 Computer Animation
Department, San Francisco
Universityof the Arts		 Note 3 Chairman Jui-Fu Liu Father and
daughter		 -
Independent
Director		 R.O.C. Che-Fu
Kung		 Male
61-70 years
old		 2021.07.29 3
years		 2015.06.15 0
0
0
0
0
0
0
0		 Department of International
Trade, Tunghai University		 Note 4 None None None -
Independent
Director		 R.O.C. Wang-
Ying Yu		 Female
61~70 years
old		 2021.07.29 3
years		 2015.06.15 0
0
0
0
0
0
0
0		 Department of International
Trade, National Taipei College of
Business		 Note 5 None None None -
Independent
Director		 R.O.C. Chung-
Lieh Kuo		 Male
61~70 years
old		 2021.07.29 3
years		 2021.07.29 0
0
0
0
0
0
0
0		 Department of Business
Administration, Chung Hua
University		 Note 4 None None None -

Note 1: Chief Strategy Officer of the Company, director of CASEMaker Inc. and director of ACTISYS INTERNATIONAL CORPORATION

Note 2: President of the Company, president of CASEMaker Inc.

Note 3: Supervisor of Welida Investment Co., Ltd.

Note 4: Member of the Remuneration Committee of the Company

Note 5: Member of the Remuneration Committee of the Company and assistant VP of the Administration Department of DOUBLE CRANE ENTERPRISE CO., LTD.

Note 6: If the chairman and the president or equivalents (the top managerial officers) of the Company are the same person, each other’s spouse or relative within first degree of kinship, the reason, rationality, necessity, countermeasures (such as increasing the number of independent directors and having a majority of directors who are not concurrently serving as employees or managerial officers, etc.) and related information should be described: No such situation.

13

(II) Major shareholders of corporate shareholders: None

(III) The major shareholders of corporate shareholders that are corporations: None

(IV) Disclosure of professional qualifications of directors and independence of independent directors:

Criteria
Name		 Professional qualifications and experience Status of independence Number of other
public
companies in
which the
individual is
concurrently
serving as an
independent
director
Chairman
Jui-Fu Liu		 Major education: Department of Electrical Engineering, National Cheng
Kung University and Honorary Doctorate, National
Dong Hwa University
Major experience: Chairman and Chief Strategy Officer of SYSCOM
COMPUTER ENGINEERING CO., director of
CASEMaker Inc., director of ACTISYS
INTERNATIONAL CORPORATION, chairman of the
Taipei Computer Association and chairman of
Information Month Compaign Committee		 1. Concurrently Chief Strategy Officer of the Company, a managerial
officer.
2. Concurrently a director of an affiliate of the Company (100%
subsidiary).
3. Natural-person shareholder holding more than 1% of the total number
of issued shares or among the top 10 shareholders in the name of
itself and its spouse.
4. A relative within the second degree of kinship of directors Jui-Long
Liu and Chih-Chun Liu.
5. A shareholder holding more than 5% of the stake of a company with
which the Company has business dealings.
6. The independence requirements set forth in the "Regulations
Governing Appointment of Independent Directors and Compliance
Matters for Public Companies" promulgated by the Financial
Supervisory Commission(FSC)has been met.








0
Director
Jui-Long Liu		 Major education: Institute of Management Science, National Chiao Tung
University
Major experience: President of SYSCOM COMPUTER ENGINEERING
CO., President of CASEMaker Inc., Lecturer of
Tamkang University, President of Information Service
Industry Association of R.O.C., Vice Chairman and
Executive Director of Cloud Computing & IoT
Association in Taiwan, Vice Chairman and Executive
Director of Digital Transformation Association, director
of National Information Infrastructure Enterprise
Promotion Association
1. Concurrently President of the Company, a managerial officer.
2. Concurrently a director of an affiliate of the Company (100%
subsidiary).
3. A relative within the second degree of kinship of director Jui-Fu Liu.
4. The independence requirements set forth in the "Regulations
Governing Appointment of Independent Directors and Compliance
Matters for Public Companies" promulgated by the Financial
Supervisory Commission has been met.




0
Director
Po-Wen Wang		 Major education: Department of Science and Management, Graduate
Institute of Business Administration, National Chengchi
University
Major experience: Deputy Director of Engineering Development Office,
National Chung-Shan Institute of Science &
Technology		 The independence requirements set forth in the "Regulations
Governing Appointment of Independent Directors and Compliance
Matters for Public Companies" promulgated by the Financial
Supervisory Commission has been met.


0
Director
Chih-Chun Liu		 Major education: Computer Animation Department, San Francisco
University of the Arts
Major experience: Supervisor of SYSCOM COMPUTER
ENGINEERING CO., supervisor of Welida Investment
Co., Ltd.		 1. Concurrently supervisor of affiliates of the Company.
2. Natural-person shareholder holding more than 1% of the total number
of issued shares or among the top 10 shareholders in the name of
itself.
3. A relative within the second degree of kinship of director Jui-Fu Liu.
4. A supervisor of a company with which the Company has business
dealings.
5. The independence requirements set forth in the "Regulations
Governing Appointment of Independent Directors and Compliance
Matters for Public Companies" promulgated by the Financial
Supervisory Commission has been met.






0
Independent
Director
Che-Fu Kung		 Major education: Department of International Trade, Tunghai University
Major experience: Member of the Remuneration Committee of the
Company and Assistant VP of WUS PRINTED
CIRCUIT CO., LTD.
With work experience in commerce and related areas required for the
Company’s business.		 The three independent directors of the Company have met the
qualifications set forth in the "Regulations Governing Appointment of
Independent Directors and Compliance Matters for Public Companies"
and Article 14-2 of the Securities and Exchange Act promulgated by
the Financial Supervisory Commission during the two years prior to
their election and during their terms of office, and all of the independent
directors have been granted the right to participate in decision-making
and express their opinions in accordance with Article 14-3 of the
Securities and Exchange Act, so that they can independently perform
the relevant duties and responsibilities.		 0
Independent
Director
Wang-Ying Yu		 Major education: Department of International Trade, National Taipei
College of Business
Major experience: Member of the Remuneration Committee of SYSCOM
COMPUTER ENGINEERING CO., Manager of
Finance Department, Manager of Sales Department,
Marketing Division, and Assistant Manager of
Administration Department, DOUBLE CRANE
ENTERPRISE CO., LTD.
With more than 5 years of work experience in commerce, financial,
accounting or related areas required for the Company’s business








0
Independent
Director
Chung-Lieh Kuo		 Major education: Department of Business Administration, Chung Hua
University
Major experience: Member of the Remuneration Committee of the
Company and Manager of Orient Semiconductor
Electronics, Ltd.
With work experience in related areas required for the Company’s
business		 0

14

  • (V) Diversity and independence of the Board of Directors:

  • Diversity of the Board of Directors:

  • (1) The Company has established the "Corporate Governance Best Practice Principles" and the composition of the Board of Directors is determined by taking into consideration the diversity of the Board of Directors, the members of which not only possess the knowledge, skills and qualities necessary to perform their duties, but also have diverse backgrounds in industry, academia and knowledge. Please refer to (IV) Disclosure of professional qualifications of directors and independence of independent directors for their educations and experiences. At present, individual directors of the Company carry through the policy of diversity of board members as follows, mainly including:

    • A.Basic criteria and values of directors, including gender, age, nationality, and culture, etc.

    • B.Directors' professional knowledge and skills, including professional background (such as law, accounting, industry, finance, marketing or technology), professional skills and industry experience, etc.

    • C.Directors’ abilities include operational judgment, accounting and financial analysis, business management, crisis management, industry knowledge, international market perspective, leadership, and decision-making ability.

(2) Implementation status of the diversity of board members:

Core items of
diversity
Director
Name		 Basic composition Basic composition Basic composition Basic composition Basic composition Basic composition Basic composition Basic composition Professional ability

Nationality		 Gender
Concurrently
serving the
Company as an
employee		 Age Tenure as an
independent
director		 The ability
to make
judgments
about
operations.
 Accounting
and financial
analysis
ability.		 Business
management
ability.		 Crisis
management
ability.		 Industry
knowledge		 International
market
perspective.		 Leadership
Decision-
making
ability
41
to
50		 51
to
60		 61
to
70		 71
to
80		 Less
than
3
years		 3 to
9
years		 More
than 9
years
Jui-FuLiu R.O.C. Male V V V V V V V V V V
Jui-LongLiu R.O.C. Male V V V V V V V V V V
Po-WenWang R.O.C. Male V V * V V V V V V
Chih-Chun Liu R.O.C. Female V V * V V V V V V
Che-Fu Kung R.O.C. Male V V V * V V V V V V
Wang-YingYu R.O.C. Female V V V V V V V V V V
Chung-Lieh
Kuo		 R.O.C. Male V V V * V V V V V V

Note: * means with partial ability

  • (3) The Company's Board of Directors has seven seats, of which three are independent directors and two are concurrently managerial officers of the Company, representing 29% of the total number of directors. No more than one-third of the directors are concurrently managerial officers of the Company. Nor more than half of the directors are spouses or relatives within second degree of kinship of each other. The percentage of independent directors is 43%. Two independent directors have a tenure of 3 to 9 years, and one independent director has a tenure of less than 3 years. Two of the Company's directors are aged 71 or older, four are aged 61 to 70, and one is aged 41 to 50. The Company has two female directors and the percentage of female directors is 29%. Already reached the goal of increasing to more than 25% ， The Company aims to increase the number of female directors to more than one-third in the future.

  • Independence of the Board of Directors:

  • (1) The Board of Directors of the Company exercises its authorities and responsibilities under the corporate governance system in accordance with laws and regulations, the Articles of Incorporation or resolutions of the shareholders' meeting. Directors and the three independent directors are independent in exercising their authorities and responsibilities in accordance with the relevant laws and regulations and leverage the Audit Committee's authorities and responsibilities to oversee the effective implementation of the Company's internal controls, the appointment and independence of attesting certified public accountants and the proper preparation of financial statements.

  • (2) The procedures for the election of all directors of the Company are open and fair, and comply with the Company's “Articles of Incorporation”, the “Regulations Governing the Election of Directors”, the “Corporate Governance Best Practice Principles”, the “Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies”, and Article 14-2 of the “Securities and Exchange Act”. The current Board of Directors has seven seats. No more than one-third of the directors are concurrently managerial officers of the Company. Nor more than half of the directors are spouses or relatives within second degree of kinship of each other.

  • (3) The Company has three independent directors, accounting for 43% of all directors. None of the three independent directors has served for more than nine consecutive years. The requirements for independent directors set forth in the "Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies" promulgated by the Financial Supervisory Commission has been met by the independent directors of the Company.

15

(VI)President, vice president, assistant VP, heads of departments and branches

As of April 15,2023 As of April 15,2023 As of April 15,2023 As of April 15,2023 As of April 15,2023
Job title Nationality Name Gender Date
elected		 Number of shares held Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship
who are officers of the
Company		 Remark
(Note 16)
Number of
shares		 Shareholding
percentage
Number
of shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
Chief Strategy
Officer		 R.O.C. Jui-Fu
Liu		 Male 2005.08.01 18,346,787 18.35 8,432,001 8.43 0 0 Department of Electrical Engineering, National
Cheng Kung University
Honorary Doctorate, National Dong Hwa
University
ChairmanoftheTaipeiComputer Association		 Note 1 President Jui-
Long
Liu		 Bothers -
President R.O.C. Jui-
Long
Liu		 Male 1993.11.08 402,562 0.40 0 0 0 0 Institute of Management Science, National
Chiao Tung University
Lecturer of Tamkang University
President of Information Service Industry
Associationof R.O.C.		 Note 2 Chief
Strategy
Officer		 Jui-
Fu
Liu		 Bothers -
Vice President R.O.C. Chin-
Hsiang
Hsu		 Male 2002.01.18 8,962 0.01 0 0 0 0 Department of Electrical Engineering, Tatung
Institute of Technology
President of QUARTIC TECHNOLOGY CO.,
LTD.		 Note 3 None None None -
Vice President R.O.C. Chao-
Lai Wu		 Male 2002.01.18 0 0 0 0 0 0 Department of Electronic Engineering,
Minghsin College of Science and Technology
Engineerof ANPEI ENTERPRISECO.,LTD.		 None None None None -
Vice President R.O.C. Anthony
Tseng
Male		 2007.06.01 977 0 102 0 0 0 Department of Electricity and Information
Technology, National Taipei College of
Business		 Note 4 None None None -
Vice President R.O.C. Chen-
Huan Li		 Male 2007.06.01 13,689 0.01 0 0 0 0 Department of Electronic Engineering
Technology, National Taiwan University of
Science andTechnology		 None None None None -
Vice President R.O.C. Chun-
Cheng
Li		 Male 2011.01.01 11,805 0.01 0 0 0 0 Department of Electronic Engineering
Technology, National Taiwan Institute of
Science andTechnology		 None None None None -
Vice President R.O.C. Kuei-
Sheng
Yuan		 Male 2016.06.01 4,000 0 0 0 0 0 Defense Management Information Course,
National Defense Management College
President of DreammapTechnologies Co.,Ltd.		 None None None None -
Vice President R.O.C. Shun-
Liang
Hsieh		 Male 2013.03.22 0 0 0 0 0 0 Department of Civil Engineering, Tamkang
University		 None None None None -
Vice President R.O.C. Bing-
SenSu		 Male 2013.03.22 66,851 0.07 487 0 0 0 Department of Business Mathematics, Soochow
University		 Note 5 None None None -
Vice President R.O.C. Chin-
Fen Wu		 Female 2015.03.26 1,552 0 0 0 0 0 Bellevue University MBA None None None None -

16

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company		 Remark
(Note 16)
Number of
shares
Shareholding
percentage
Number
of shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
Vice President R.O.C. Nai-
Cheng
Cheng		 Male 2017.06.26 0 0 0 0 0 0 Institute of Management Science, Tamkang
University
President of Business Group I, RING LINE
CORP.		 None None None None -
Vice President R.O.C. Tsan-
Chang
Li		 Male 2020.07.01 0 0 0 0 0 0 Department of Electronics, Tungnan College of
Technology
Product Manager of Taiwan Branch, Diebold
corp
SalesDivisionChiefofSYSTEXCorporation		 Note 6 None None None -
Sales Vice
President		 R.O.C. Li-
Chang
Wu		 Male 2010.11.19 7,543 0.01 0 0 0 0 Department of Computer Science, Feng Chia
University		 None None None None -
Project Vice
President		 R.O.C. Yen-
Nien Hu		 Male 2018.08.15 0 0 0 0 0 0 Graduate School of Business Administration,
Da-Yeh University
DivisionChiefofVeteransAffairs Council		 None None None None -
Sales Vice
President		 R.O.C. Yu-
Lung
Hsueh		 Male 2019.05.10 0 0 0 0 0 0 Master of Business Administration, National
Sun Yat-sen University		 None None None None -
Sales Vice
President		 R.O.C. Cheng-
Tung
Ko		 Male 2020.03.01 1,027 0 937 0 0 0 Department of Business Administration,
Tunghai University		 None None None None -
Sales Vice
President		 R.O.C. Hsu-
Hung
Chen		 Male 2022.01.01 0 0 0 0 0 0 Master of Business Administration, National
Chengchi University,Master of Business
Administration, Tatung University
Senior DivisionChiefof RINGLINECORP.		 None None None None -
Sales Vice
President		 R.O.C. Kuang-
Keng
Liang		 Male 2022.01.17 0 0 0 0 0 0 Department of Electrical Engineering, National
Taipei University of Technology		 None None None None -
Sales Vice
President		 R.O.C. Shu-
Ching
Lin		 Female 2022.07.01 941 0 0 0 0 0 Department of Business Administration,
National Taipei College of Business,		 None None None None -
Sales Vice
President		 R.O.C. Ming-
Feng Li		 Male 2022.07.11 0 0 0 0 0 0 Department of Computer Engineering,
Tamkang University
Managerof Alcatel-LucentEnterpriseTaiwan		 None None None None -
Chief
Technology
Officer		 R.O.C. Ching-
Tzu
Shih		 Male 2005.06.01 2,552 0 0 0 0 0 Department of Electrical Engineering, Chung
Yuan Christian University
Engineerof TAI TIENELECTRIC CO.,LTD.		 Note 7 None None None -
Principal
Division Chief		 R.O.C. Jia-
Chang
Chang		 Male 2005.06.01 0
0
0		 0 0 0 Department of Shipbuilding, National Taiwan
Ocean University
Completed the third programming session of
programming class of the Youth Development
Administration		 Note 8 None None None -

17

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company		 Remark
(Note 16)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
Chief R&D
Officer		 R.O.C. Tsai-
Cheng
Chen		 Male 2005.06.01 0 0 0 0 0 0 Department of Information Science, National
Chiao Tung University		 None None None None -
Principal
Division Chief		 R.O.C. Tsai-
Chi
Sung		 Male 2005.06.01 17,360 0.02 0 0 0 0 Department of Electronics, Minghsin College of
Science and Technology		 Note 9 None None None -
Principal
Division Chief		 R.O.C. Chih-
Wei
Wen		 Male 2005.06.01 0
0
0		 0 0 0 Department of Electrical Engineering, National
Tsing Hua University		 None None None None -
Chief Finance
Officer		 R.O.C. Li-
Chueh
Du		 Female 2000.06.19 13,793 0.01 0 0 0 0 Department of Statistics and Accounting,
National Taipei College of Business,		 None None None None -
Principal
Division Chief		 R.O.C. Ming-
Kun
Lin		 Male 2005.06.01 0 0 0 0 0 0 Institute of Information Engineering, Tamkang
University		 None None None None -
Principal
DivisionChief		 R.O.C. Chien-
Yi Li		 Male 2005.06.01 0 0 0 0 0 0 Department of Information Engineering,
NationalChiaoTung University		 None None None None -
Principal
Division Chief		 R.O.C. Chih-
Chung
Chen		 Male 2005.06.01 4,750 0 0 0 0 0 Department of Mathematics, Tamkang
University		 Note 10 None None None -
Principal
Division Chief		 R.O.C. Feng-
Lin
Yen		 Male 2005.06.01 500 0 0 0 0 0 Department of Information Management,
Providence University		 None None None None -
Senior Assistant
VP		 R.O.C. Mao-
Ming
Wang		 Male 2006.04.17 0 0 0 0 0 0 Department of Mechanics, Army Academy
R.O.C.		 None None None None -
Principal
DivisionChief		 R.O.C. Ta-Yu
Teng		 Male 2007.02.01 21,842 0.02 0 0 0 0 Department of Electronical Engineering,
Tamkang University		 None None None None -
Principal
DivisionChief		 R.O.C. Po-Shu
Hsueh
Male		 2007.03.01 0 0 0 0 0 0 Department of Electronical Engineering,
NationalChiaoTung University		 None None None None -
Assistant VP R.O.C. Kai-
Tsung
Wang		 Male 2007.10.01 470 0 0 0 0 0 MS in Information Management, New York
Institute of Technology		 None None None None -
Principal
Division Chief		 R.O.C. Cheng-
Wu
Shao		 Male 2007.10.01 0 0 0 0 0 0 Institute of Information Engineering, National
Chiao Tung University		 Note 11 None None None -

18

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company		 Remark
(Note 16)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
Senior Assistant
VP		 R.O.C. Mei-
Ling
Yang		 Female 2009.04.01 6,601 0.01 0 0 0 0 Department of Electronic Data Management,
Ming Chuan University		 None None None None -
Senior Division
Chief		 R.O.C. Wen-
Hsiung
Yeh		 Male 2009.06.01 175 0 0 0 0 0 Department of Mechanical Engineering, Chung
Yuan Christian University		 None None None None -
Principal
Division Chief		 R.O.C. Kun-
Ting
Chiu		 Male 2010.01.07 6,421 0.01 0 0 0 0 Department of Information Management, National
Central University		 Note 12 None None None -
Division Chief R.O.C. Yen-
Mei
Lin		 Female 2010.02.01 0 0 0 0 0 0 Department of International Trade, Tamkang
University		 None None None None -
Principal
Division Chief		 R.O.C. Yung-
Chen
Yang		 Female 2010.04.01 36,340 0.04 617 0 0 0 Department of Business Administration,
Providence University		 None None None None -
Division Chief R.O.C. Shu-
Hua
Liu		 Female 2010.10.01 2,962 0 0 0 0 0 Department of Statistics and Accounting, Takming
College of Business,		 None None None None -
Principal
DivisionChief		 R.O.C. Chao-
YiWu		 Male 2011.01.17 0 0 0 0 0 0 Department of Electronic Engineering, National
Taipei Institute of Technology		 Note 13 None None None -
Senior Assistant
VP		 R.O.C. Hung-
Chun
Chao		 Male 2011.06.07 500 0 1,000 0 0 0 Department of Psychology, Chung Yuan Christian
University		 None None None None -
Division Chief R.O.C. Wen-
Ching
Tsai		 Male 2011.07.01 0 0 0 0 0 0 Institute of Information Engineering, National
Taiwan University		 None None None None -
Senior Assistant
VP		 R.O.C. Chun-
Yi
Chao		 Female 2011.07.04 0 0 0 0 0 0 Kao Yuan Technical College
Project Manager of SYSTEX Corporation		 None None None None -
Senior Division
Chief		 R.O.C. Chia-
Yuan
Yeh		 Male 2011.07.05 4,362 0 0 0 0 0 Institute of Information Management, National
Central University		 None None None None -
Division Chief R.O.C. Chia-
RuLiu		 Male 2012.03.21 369 0 0 0 0 0 Institute of Traffic and Transportation Studies,
NationalChiaoTung University		 None None None None -
Principal
Division Chief		 R.O.C. Te- Li
Chen		 Male 2012.03.21 2,221 0 0 0 0 0 Department of Electric Engineering, National
Taipei Universityof Technology		 None None None None -

19

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company		 Remark
(Note 16)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
Principal
DivisionChief		 R.O.C. Yi-Lun
Wang		 Male 2012.03.21 1,000 0 1,108 0 0 0 Institute of Business Administration, National
TaipeiUniversity of Technology		 None None None None -
Division Chief R.O.C. Chi-An
Hsueh
Male		 2012.03.21 3,409 0 1,199 0 0 0 Institute of Information Management, National
Sun Yat-senUniversity		 None None None None -
Division Chief R.O.C. Chi-
Hsiang
Tang		 Male 2012.08.27 0 0 0 0 0 0 Institute of Electrical Engineering, National
Taiwan University of Science and Technology		 None None None None -
Division Chief R.O.C. Nai-
Fang
Cheng		 Female 2012.08.27 0 0 0 0 0 0 Department of Foreign Languages, National
Taiwan University		 None None None None -
Senior Assistant
VP		 R.O.C. Yao-
Chang
Chen		 Male 2012.08.27 0 0 0 0 0 0 Department of Information Science, Chinese
Culture University		 None None None None -
Principal
Division Chief		 R.O.C. Yi-
Ming
Chang		 Male 2012.08.27 4,991 0 0 0 0 0 Department of Information Engineering, Tamkang
University		 None None None None -
Division Chief R.O.C. Cheng-
YuLi		 Male 2013.03.22 0 0 0 0 0 0 Master Program of Information Engineering,
National TaipeiUniversity of Technology		 None None None None -
Senior Assistant
VP		 R.O.C. Chia-
Ching
Li		 Female 2013.03.22 1,000 0 0 0 0 0 Department of Business Management Technology,
National Taiwan University of Science and
Technology		 None None None None -
Senior Assistant
VP		 R.O.C. Tsang-
Sung
He		 Male 2013.03.22 0 0 0 0 0 0 Institute of Management Studies, I-SHOU
University		 None None None None -
Principal
Division Chief		 R.O.C. Huang-
Hsiang
Yang		 Male 2013.05.09 0 0 0 0 0 0 University of San Francisco MBA None None None None -
Division Chief R.O.C. Wen-
PoHsu		 Female 2013.08.12 0 0 0 0 0 0 Department of Industrial Management, Huafan
University		 None None None None -
Division Chief R.O.C. Erh-
Wei
Dai		 Male 2013.08.12 0 0 0 0 0 0 Department of Mathematics, Fu Jen Catholic
University		 None None None None -
Principal
DivisionChief		 R.O.C. Hui-Yi
Lin		 Male 2013.08.12
12,000
0.01
0
0
0
0		 Institute of Information Engineering, Feng Chia
University		 None None None None -

20

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company		 Remark
(Note 16)
Number
of shares		 Shareholding
percentage
Number of
shares
Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
Senior Assistant
VP		 R.O.C. Tien-
Chih
Yen		 Male 2014.03.28 0 0 0 0 0 0 Department of Information Management,
Southern Taiwan University of Science and
Technology		 None None None None -
Assistant VP R.O.C. Hao-
Cheng
Yang		 Male 2014.03.28 0 0 0 0 0 0 Department of Mechanical Engineering, National
Taipei Institute of Technology		 None None None None -
Principal
DivisionChief		 R.O.C. Wan-
Tan Lin		 Male 2014.03.28 0 0 0 0 0 0 Department of Information Management, Fu Jen
Catholic University		 Note 14 None None None -
Principal
Division Chief		 R.O.C. Fu-
Chien
Cheng		 Male 2014.03.28 0 0 0 0 0 0 Institute of Information Management, National
Sun Yat-sen University		 None None None None -
Division Chief R.O.C. Hung-
Yi Lin		 Male 2014.03.28 3,545 0 0 0 0 0 Department of Electronic Engineering
Technology, National Taiwan Institute of Science
andTechnology		 None Division
Chief
Mei-
Feng
Chang		 Man and
wife		 -
Division Chief R.O.C. Chiung-
WeHsu		 Female 2014.03.28 0 0 0 0 0 0 Department of Electricity and Information
Technology, National TaipeiCollege of Business		 None None None None -
Principal
Division Chief		 R.O.C. Chiu-
Jung
Chiang		 Female 2014.05.09 3,937 0 0 0 0 0 Department of Cooperative Economics, Tamkang
University
Leaderof InformationOffice, GuoBao Securities		 None None None None -
Senior Assistant
VP		 R.O.C. Shih-
Fang
Chang		 Female 2015.02.06 0 0 0 0 0 0 Department of International Trade, Chihlee
College of Technology
Project Manager of DIMERCO DATA SYSTEM
CORPORATION		 None None None None -
Senior Assistant
VP		 R.O.C. Chia-
Hsu
Hsiao		 Male 2015.02.13 0 0 0 0 0 0 Department of Electronical Engineering, Chung
Yuan Christian University
Division Chief of Enterprise Business Group,
Dimension Data		 None None None None -
Assistant VP R.O.C. Li-
Chun
Lin		 Male 2015.03.26 0 0 0 0 0 0 MS in Information Management, National Taiwan
University of Science and Technology		 None None None None -
Principal
Division Chief		 R.O.C. Rui-
Ching
Lin		 Male 2015.03.26 0 0 0 0 0 0 Institute of Business Administration, Tunghai
University		 None None None None -
Division Chief R.O.C. Mei-
Feng
Chang		 Female 2015.04.01 0 0 3,545 0 0 0 National Chin-Yi College of Technology None Division
Chief
Hung-
Yi Lin		 Man and
wife		 -
Senior Division
Chief		 R.O.C. Chih-
Cheng
Lin		 Male 2015.05.08
0
0
0
0
0
0		 Department of Information Management, National
Central University		 None None None None -

21

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others
Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company		 Remark
(Note 16)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
Project Division
Chief		 R.O.C. Kang-
Yuan
Fan		 Male 2015.10.26 500 0 0 0 0 0 Department of Mathematics, Tamkang University None None None None -
Assistant VP R.O.C. Wei-
Min
Chen		 Male 2015.11.10 0 0 371 0 0 0 Department of Information Engineering, Feng Chia
University		 None None None None -
Division Chief R.O.C. Wei-Jen
Cheng		 Male 2016.05.09 0 0 0 0 0 0 Department of Applied Mathematics, National Sun Yat-
sen University
Assistant VP,HWACOM SYSTEMS INC.		 None None None None -
Acting Assistant
VP		 R.O.C. Chin-
Yu
Chen		 Female 2016.08.08 0 0 0 0 0 0 Department of Economics, Chinese Culture University
Sales Manager of Howard Hotels		 None None None None -
Senior Division
Chief		 R.O.C. Yu-Ting
Tseng
Female		 2016.11.08 0 0 0 0 0 0 Institute of Telecommunications, National Taiwan
University
Leader of Network Maintenance Division, Taiwan Fixed
Network Co.,Ltd.		 None None None None -
Assistant VP R.O.C. Yi-
Chun
Liu		 Male 2017.02.15 165 0 0 0 0 0 Department of Industrial Design, Ming Chi College of
Technology
Angroup Technology Co., Ltd.		 None None None None -
Project Division
Chief		 R.O.C. Yen-Fu
Chou		 Male 2017.02.20 0 0 0 0 0 0 Department of Electrical Engineering, 2-Year Diploma,
Taipei City University of Science and Technology		 None None None None -
Principal Division
Chief
R.O.C.		 Chin-Yi
Liao		 Male 2017.03.01 0 0 0 0 0 0 Department of Electronic Engineering, Minghsin College
of Science and Technology
Project Assistant VP of Systex Solutions Corporation		 None None None None -
Division Chief R.O.C. Chun-
Feng
Lin		 Male 2017.04.01 0 0 0 0 0 0 In-service Program, Institute of Health Management,
Asia University
Department of Information Management, Chung Yuan
Christian University		 None None None None -
Project Assistant
VP		 R.O.C. Chun-
HuaLiu		 Male 2017.05.10 437 0 0 0 0 0 Institute of Electrical Engineering, National Chung
Hsing University		 None None None None -
Project Assistant
VP		 R.O.C. Chung-
Chieh
Wu		 Male 2017.07.11 0 0 0 0 0 0 Department of Information Science, Chinese Culture
University
Vice President of INPRO TECHNOLOGIES CORP.		 None None None None -
Assistant VP R.O.C. Hung-
Yu Hsu		 Male 2017.07.20 0 0 0 0 0 0 MS of Institute of National Defense Information,
National Defense Management College
Deputy Researcher of Cybersecurity Office, National
SecurityCouncil.		 None None None None -
Principal Division
Chief
R.O.C.		 Min-
Chung
Huang		 Male 2017.08.01
0
0
0
0
0
0		 MBA of Institute of Management, National Taipei
University of Business		 None None None None -

22

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship who
are officers of the Company
Spouse or relatives within
second degree of kinship who
are officers of the Company
Spouse or relatives within
second degree of kinship who
are officers of the Company		 Remark
(Note 16)
Number
of shares		 Shareholding
percentage
Number of
shares
Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
Assistant VP R.O.C. Po-Yi
Chen		 Male 2017.08.11 0 0 0 0 0 0 Department of Applied Mathematics, National
Chung Hsing University		 None Project
Assistant
VP
Jo-
Han
Hsieh		 Man and
wife		 -
Division Chief R.O.C. Kuan-
Chih
Chen		 Male 2017.08.11 0 0 0 0 0 0 Department of Business Administration, Chung
Hua University		 None None None None -
Division Chief R.O.C. Chun-
Fu
Yang		 Male 2017.08.11 0 0 0 0 0 0 EMBA of National Taipei University of Business None None None None -
Division Chief R.O.C. Ta-Jen
Hsu		 Male 2017.08.11 0 0 0 0 0 0 MS in Electric Engineering, National Kaohsiung
University ofScience andTechnology		 None None None None -
Division Chief R.O.C. Chung-
Chun
Lin		 Male 2017.08.11 2,663 0 0 0 0 0 Department of Electronic Engineering, Asia
Eastern College of Science and Technology		 None None None None -
Senior Division
Chief		 R.O.C. Tai-
Yuan
Hu		 Male 2017.11.01 0 0 0 0 0 0 Institute of Information Engineering, Tamkang
University
Manager of Development Department, MODERN
TIMES FINANCIAL INFORMATION CO.,
LTD.		 None None None None -
Division Chief R.O.C. Shu-
Chuan
Chiu		 Female 2017.11.10 0 0 0 0 0 0 Department of Chinese, National Sun Yat-sen
University		 None None None None -
Project Assistant
VP
R.O.C.		 Yung-
Kang
Chang		 Male 2018.05.21 0 0 0 0 0 0 Department of Information Management,
Minghsin University of Science and Technology		 None None None None -
Division Chief R.O.C. Meng-
Hung
Pan		 Male 2018.07.01 0 0 0 0 0 0 Department of Information Management,
Chaoyang University of Technology		 None None None None -
Division Chief R.O.C. Fan-
Ying
Chang		 Male 2018.08.09 0 0 0 0 0 0 Department of Electronics, National Taipei
Institute of Technology		 None None None None -
Division Chief R.O.C. Yu-
Hsiang
Lin		 Male 2018.08.09 0 0 0 0 0 0 Department of Information Engineering, Feng
Chia University		 None None None None -
Division Chief R.O.C. Yu-
Chung
Huang		 Male 2018.08.09 0 0 0 0 0 0 Department of Electronics, Asia Eastern College
of Science and Technology		 None None None None -
Assistant VP R.O.C. Yu-
Kang
Tseng		 Male 2018.08.09
0
0
0
0
0
0		 Department of Mechanical Engineering, Lee-
Ming Institute of Technology
Sales Manager of CHUNG HWA EXCHANGE
NETWORK INC.		 Note 15 None None None -

23

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship who
are officers of the Company
Spouse or relatives within
second degree of kinship who
are officers of the Company
Spouse or relatives within
second degree of kinship who
are officers of the Company		 Remark
(Note 16)
Number
of shares		 Shareholding
percentage
Number of
shares
Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
Project Division
Chief		 R.O.C. Tsang-
Wei
Chang		 Male 2018.10.09 0 0 0 0 0 0 EMBA of Information Management Group,
National Chengchi University
Chief of Electrical and Mechanical Engineering
Division, CHUNGHWA SYSTEM
INTEGRATION CO.,LTD.		 None None None None -
Senior Division
Chief		 R.O.C. Wei-Pi
Chou		 Male 2019.01.31 1,500 0 0 0 0 0 Institute of Information Management, National
Taiwan Institute ofScience andTechnology		 None None None None -
Assistant VP R.O.C. Cheng-
We
Hung		 Male 2019.04.01 0 0 0 0 0 0 Institute of Electric Commerce, National Chung
Hsing University		 None None None None -
Division Chief R.O.C. Chun-
Tzu
Chen		 Female 2019.05.10 0 0 0 0 0 0 Department of International Trade, Feng Chia
University
SalesManagerof BESTCOM InfotechCorp.		 None None None None -
Assistant VP R.O.C. Chiu-
Hua
Lin		 Female 2019.05.10 0 0 0 0 0 0 Department of Industrial Engineering, Chung
Yuan Christian University		 None None None None -
Acting Division
Chief		 R.O.C. Yi-
Hsuan
Lai		 Female 2019.05.10 3,437 0 0 0 0 0 Department of Electronic Data Management,
Overseas Chinese University		 None None None None -
Project Assistant
VP
R.O.C.		 Hsin-
Jung
Lu		 Female 2019.05.10 0 0 0 0 0 0 Department of German, Tamkang University
Sales Manager of Tatung Medical & Healthcare
Technologies Co.,Ltd.		 None None None None -
Project Assistant
VP
R.O.C.		 Jo-Han
Hsieh		 Female 2019.05.10 0 0 0 0 0 0 Department of Information Management, Shih
HsinUniversity		 None Assistant
VP
Po-Yi
Chen		 Man and
wife		 -
Acting Assistant
VP		 R.O.C. Chia-
Yu
Chen		 Male 2019.05.24 500 0 0 0 0 0 Department of Business Administration, Soochow
University
EngineerofOTUSIMAGING,INC.		 None None None None -
Project Division
Chief		 R.O.C. Ta-
Chung
Kuo		 Male 2019.07.01 0 0 0 0 0 0 Institute of Information Management, Fu Jen
Catholic University		 None None None None -
Project Division
Chief		 R.O.C. Yu-
Hsiang
Lin		 Male 2019.07.01 0 0 0 0 0 0 MS in Information Engineering, National Taipei
University of Technology		 None None None None -
Project Division
Chief		 R.O.C. Chih-
Shan
Chen		 Male 2020.02.01 0 0 0 0 0 0 Institute of Information Management, Tatung
University
Project Manager of TATUNG INFOCOMM CO.,
LTD.		 None None None None -
Division Chief R.O.C. Ching-
Wang
Huang		 Male 2020.03.23
0
0
0
0
0
0		 MS in Information Network Systems, School of
Information Technology, Ming Chuan University
Special Program		 None None None None -

24

Job title Nationality Name Gender Date
elected		 Number of shares held Number of shares held Shareholding of spouse
and minor children		 Shareholding of spouse
and minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company
Spouse or relatives within
second degree of kinship
who are officers of the
Company		 Remark
(Note
16)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
Division Chief R.O.C. Yuan-
Chuan
Yeh		 Male 2020.03.23 0 0 0 0 0 0 Department of Electrical Engineering, St. John's
University		 None None None None -
Senior Division
Chief		 R.O.C. Che-
Zhe
Liu		 Male 2020.03.23 0 0 0 0 0 0 Department of Medical Administration, Chang Gung
University		 None None None None -
Project Assistant
VP		 R.O.C. Yung-
Pin Du		 Male 2020.05.04 527 0 0 0 0 0 Department of Molecular Science and Engineering, ,
National Taipei University of Technology
Radware Ltd.		 None None None None -
Division Chief R.O.C. Hsiang-
Teng
Yeh		 Male 2020.11.10 0 0 0 0 0 0 Department of Computer Engineering, National Chiao
Tung University		 None None None None -
Project Division
Chief		 R.O.C. Ching-
Hsun
Hou		 Male 2021.02.01 0 0 0 0 0 0 Department of English, Fu Jen Catholic University None None None None -
Division Chief R.O.C. Yu-Na
Chiu		 Female 2021.03.18 0 0 0 0 0 0 MS in Health Management, Asia University
Specialist of Medical Information Management Division,
BenqHospital,China		 None None None None -
Division Chief R.O.C. Chih-
Kai
Hsu		 Male 2021.03.18 0 0 0 0 0 0 Department of Medical Technology, National Taiwan
University
Chief Technology Officer of COMM VERGE
SOLUTIONS(Taiwan)		 None None None None -
Corporate
Governance
Officer		 R.O.C. Chun-
Yen
Chen		 Female 2021.03.18 486 0 5,000 0 0 0 Department of Accounting, National Cheng Kung
University
Senior Auditor of Deloitte & Touche		 None None None None -
Division Chief R.O.C. Shan-
Mao
Cheng		 Female 2021.05.12 1,928 0 680 0 0 0 Department of Public Finance and Taxation, National
Chung Hsing University
Chief Accountant of YING-LU ENTERPRISE CO., LTD.		 None None None None -
Assistant VP R.O.C. Ying-
Ya
Wang		 Female 2021.05.12 0 0 0 0 0 0 Department of Philosophy, National Chengchi University None None None None -
Assistant VP R.O.C. Chen-
Kai
Hua		 Male 2021.05.12 0 0 0 0 0 0 Department of Business Administration, Ming Chuan
University
Sales of BESTCOM Infotech Corp.		 None None None None -
Acting Assistant
VP		 R.O.C. Yu-
Hsuan
Kuo		 Male 2021.05.12 0 0 0 0 0 0 MSFE of West Texas A&M University None None None None -
Project Assistant
VP		 R.O.C. Hsuan-
Fa
Huang		 Male 2021.05.12 0 0 0 0 0 0 Department of Information Management, China College
of Commerce and Industry
Manager of Marketing and Sales Department, Great
Taipei Broadband Co.,Ltd.		 None None None None -

25

Job title Nationality
Name		 Gender Date elected Number of shares held Number of shares held Shareholding of spouse and
minor children		 Shareholding of spouse and
minor children		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relat
second degree of
are officers of th
Spouse or relat
second degree of
are officers of th		 ives within
kinship who
e Company		 Remark
(Note
16)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
Project Assistant VP R.O.C. Kuo-Shu
Hsu		 Male 2021.05.12 0
0
0
0
0
0		 Department of Social Psychology, Shih Hsin University
Sales Manager of RING LINE CORP.		 None None None None -
Division Chief R.O.C. Yung-
Ching
Chen		 Male 2021.05.12 0
0
0
0
0
0		 Department of Chemical Engineering, Tamkang
University
Vice President of HAUMAI INDUSTRIAL CO.,LTD		 None None None None -
Division Chief R.O.C. Chung-Yi
Lin		 Male 2021.05.12 3,316
0
0
0
0
0		 Department of Applied Chemistry, Hsiuping University of
Science and Technology
Senior System Engineer of K WAY INFORMATION
CORPORATION		 None None None None -
Division Chief R.O.C. Hsin-Yi
Li		 Female 2021.07.08 20,734
0.02
0
0
0
0		 Department of Information Management, Fu Jen Catholic
University		 None None None None -
Acting Division
Chief		 R.O.C. Yu-Chia
Hsiao		 Male 2021.07.08 0
0
0
0
0
0		 Institute of Medical Information, Taipei Medical
University		 None None None None -
Division Chief R.O.C. Ting-Jung
Chang
Male		 2021.08.02 0
0
0
0
0
0		 Institute of Information Management, Providence
University
Vice President of Information Technology Service
Department,FINANCIAL eSOLUTION CO.,LTD.		 None None None None -
Division Chief R.O.C. Chia-Yi
Tsao		 Male 2021.12.01 0
0
0
0
0
0		 Department of Mechanical Engineering, Tamkang
University		 None None None None -
Division Chief R.O.C. Fu-Yuan
Wen		 Male 2022.05.11 0
0
0
0
0
0		 Institute of Applied Mathematics, Tatung University None None None None -
Division Chief R.O.C. Yi-Feng
Lai		 Female 2022.05.11 0
0
0
0
0
0		 Institute of Information Management, National Central
University		 None None None None -
Project Assistant VP R.O.C. Yi-Ling
Hsu		 Female 2022.06.01 0
0
0
0
0
0		 Department of Information Management, Takming
Universityof Science and Technology		 None None None None -
Project Assistant VP R.O.C. Hung-Jen
Hsiao		 Male 2022.06.01 0
0
0
0
0
0		 Department of Economics, Fu Jen Catholic University None None None None -
Project Assistant VP R.O.C. Yi-Cheng
Wu		 Male 2022.06.01 0
0
0
0
0
0		 Department of Information Management, Chinese Culture
University		 None None None None -
Project Assistant VP R.O.C. Sheng-Yu
Chen		 Male 2022.06.01 500
0
0
0
0
0		 Department of Electronic Engineering, Southern Taiwan
Universityof Science and Technology		 None None None None -
Division Chief R.O.C. Ling-Hao
Chen		 Male 2022.06.20 0
0
0
0
0
0		 Department of Electronical Engineering, Feng Chia
University
Chief Engineer of Taiwan Mobile Co.,Ltd.		 None None None None -
Project Division
Chief		 R.O.C. Chun-
Wen Yu		 Male 2022.07.01 0
0
0
0
0
0		 Department of Information Communication, Shih Hsin
University
Engineer of Tuo WangCo.,Ltd.		 None None None None -
Division Chief R.O.C. Cheng-
Heng
Deng		 Male 2022.08.10 0
0
40,000
0.04
0
0		 Department of Electronic Data Management, Tamsui
Institute of Business Administration		 None None None None -
Acting Assistant VP R.O.C. Ying-
Ying Hsu		 Female 2022.08.22 0
0
0
0
0
0		 Department of Bank Insurance, Hungkuo Delin College of
Technology
Sales Project Manager of DYNASAFE
TECHNOLOGIES,INC.		 None None None None -

26

Job title Nationality
Name		 Gender Date elected Number of shares held Number of shares held Shareholding o
minor c		 f spouse and
hildren		 Shareholding in the
name of others		 Shareholding in the
name of others		 Major experience (education)
 Concurrent
positions
in other
companies
now
Spouse or relat
second degree of
are officers of th
Spouse or relat
second degree of
are officers of th		 ives within
kinship who
e Company		 Remark
(Note
16)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
Project Division
Chief		 R.O.C. Chi-
Cheng
Chih		 Female 2022.09.01 0
0
0
0
0
0		 Curtin University W.A.
Master of Information System		 None None None None -
Principal Division
Chief		 R.O.C. Te-Kuei
Chiu		 Male 2022.11.01 0
0
0
0
0
0		 Department of Aviation, Tamkang University
Chief of TechnologyDivision,SYSTEX Corporation		 None None None None -
Division Chief R.O.C. Hung-Jui
Hsieh		 Male 2023.03.17 0
0
0
0
0
0		 Department of Information Management, National
Kaohsiung University of Science and Technology
Deputy Manager, Information Technology Department,
Entie Commercial Bank		 None None None None -
Division Chief R.O.C. Zhong-
Yan Wu		 Male 2023.03.17 0
0
0
0
0
0		 Department of Internet Technology, Yuan Ze University None None None None -
Division Chief R.O.C. Hao-Fan
Liu		 Male 2023.03.17 0
0
0
0
0
0		 Department of Computer Science & Information
Engineering,MingChuan University		 None None None None -
Division Chief R.O.C. Chiung-
YingTai		 Female 2023.03.22 1,000
0
0
0
0
0		 Department of Information Management, Fu Jen Catholic
University		 None None None None -
Acting Division
Chief		 R.O.C. Yao-Jen
Yeh		 Male 2023.03.27 0
0
0
0
0
0		 EMBA, Royal Roads University
Architect, IBM; CTO/Vice President, Infoarchi
Information Co.,Ltd.		 None None None None -

Note 1: Director of CASEMaker,Inc., director of ACTISYS INTERNATIONAL CORPORATION Note 2: President of CASEMaker Inc. Note 3: Director of Syscom Computer(Thailand)Co., Ltd. Note 4: Legal representative of the director of Cloudmaster Co., Ltd. Note 5: Chairman of Furly Investment Co., Ltd. Note 6: Legal representative of the director of Syscom Computer(Shenzhen)Co., Ltd., legal representative of the director of Xian Linan Computer Co., Ltd. Note 7: Legal representative of the director of Netmaker Technology Co., Ltd. Note 8: Supervisor of Wisemaker Technology Co. Note 9: Legal representative of the director of Netmaker Technology Co., Ltd. Note 10: Legal representative of the director of Coach Technology Management Inc. Note 11: Legal representative of the director of Wisemaker Technology Co. Note 12: Legal representative of the director of SYSCOM INTERNATIONAL INC., supervisor of Cloudmaster Co., Ltd., supervisor of CloudMaster Japan Co.,Ltd. Note 13: Supervisor of Netmaker Technology Co., Ltd. Note 14: Legal representative of the director of Wisemaker Technology Co., director of Coach Technology Management Inc., chairman of Cloudmaster Co., Ltd. Note 15: Supervisor of Syscom Computer(Shenzhen)Co., Ltd.

Note 16: If the president or equivalents (the top managerial officer) and the chairman of the Company are the same person, each other’s spouse or relative within first degree of kinship, the reason, rationality, necessity, countermeasures (such as increasing the number of independent directors and having a majority of directors who are not concurrently serving as employees or managerial officers, etc.) and related information should be described: No such situation.

27

III. Remuneration paid to directors (including independent directors), president and vice president for the most recent fiscal year

(I) Remuneration to directors (including independent directors)

Unit: Thousands of NTD

Job title Name Remuneration fo Remuneration fo Remuneration fo Remuneration fo r directors r directors Total Remuneration (A+
B+ C+ D) and as a % of
the net profit after tax		 Total Remuneration (A+
B+ C+ D) and as a % of
the net profit after tax		 Remu Remu neration for concurrent position as an employee neration for concurrent position as an employee neration for concurrent position as an employee neration for concurrent position as an employee neration for concurrent position as an employee neration for concurrent position as an employee Total Remuneration (A+
B+ C+ D+E+F+G) and as
a % of the net profit after
tax
 Total Remuneration (A+
B+ C+ D+E+F+G) and as
a % of the net profit after
tax
 Remuneration
from
investees
outside
subsidiaries
or from the
parent
company
Base remuneration
(A)		 Severance and pension
(B)		 Profit-sharing
remuneration for
directors
(C)		 Busines
exp
 s execution
enses
(D)		 Salary, bonus, allowance
(E)		 Severance and pension
(F)		 Profit-sharing remuneration for employees
(G)
The
Company		 All
companies
in the
financial
statements		 The
Company		 All
companies
in the
financial
statements		 The
Company		 All
companies
in the
financial
statements		 The
Company		 All
companies
in the
financial
statements		 The
Company		 All
companies
in the
financial
statements		 The
Company		 All
companies
in the
financial
statements		 The
Company		 All
companies
in the
financial
statements		 The Company All companies in
the financial
statements		 The
Company		 All
companies
in the
financial
statements
Cash
amount		 Stock
amount		 Cash
amount		 Stock
amount
Director Jui-Fu Liu 480
480
0		 0
0		 0 24 24
504
0.20%

504
0.20%

7,507		 8,079
0
0		 49
0
49		 0
8,060
3.21%

8,632
3.44%

None
Jui-Long Liu
Po-Wen Wang
Chih-Chun Liu
Independent
Director		 Wang-Ying Yu 360
360
0
0
0
0
45
45
405
0.16%
405
0.16%
0
0
0
0
0
0
0
0
405
0.16%

405
0.16%
None

Che-Fu Kung
Chung-Lieh Kuo
1. Please describe the policy, system, criteria and structure for the remuneration for independent directors, and the correlation to the amount of remuneration in terms of their responsibilities, risks, time spent and other factors:
Remuneration for the Company's independent directors is determined in accordance with the Company's Articles of Incorporation and the remuneration system for directors, members of functional committees and managerial officers,
with reference to the extent of the directors' participation in the Company's operations and the value of their contributions, as well as the usual standards in the industry. The Company's independent directors are currently paid only with
the fixed monthly salary, travel expenses or attendance fees, and no variable remuneration.
2. Except as disclosed above, the remuneration for the directors of the Company for providing services to all companies in the financial statements (such as serving as a non-employee consultant, etc.) in the most recent year: None.

28

Remuneration range table

Remuneration range table Remuneration range table
Remuneration rangepaid to each director of the Company Name of director
Sum of the preceding four types of remunerations (A+B+C+D) Sum of the preceding seven types of remunerations
(A+B+C+D+E+F+G)
The Company All companies in the financial
statements		 The Company All companies in the financial
statements
Less than $1,000,000 Jui-Fu Liu, Jui-Long Liu,
Po-Wen Wang, Chih-Chun Liu,
Wang-Ying Yu, Che-Fu Kung,
Chung-Lieh Kuo		 Jui-Fu Liu, Jui-Long Liu,
Po-Wen Wang, Chih-Chun Liu,
Wang-Ying Yu, Che-Fu Kung,
Chung-Lieh Kuo		 Po-Wen Wang, Chih-Chun Liu,
Wang-Ying Yu, Che-Fu Kung,
Chung-Lieh Kuo		 Po-Wen Wang, Chih-Chun Liu,
Wang-Ying Yu, Che-Fu Kung,
Chung-Lieh Kuo
$1,000,000(inclusive)～$2,000,000(exclusive) None None None None
$2,000,000 (inclusive)～3,500,000 (exclusive) None None Jui-Fu Liu Jui-Fu Liu
$3,500,000 (inclusive)～$5,000,000 (exclusive) None None Jui-Long Liu Jui-Long Liu
$5,000,000(inclusive)～$10,000,000(exclusive) None None None None
$10,000,000(inclusive)～$15,000,000(exclusive) None None None None
$15,000,000(inclusive)～$30,000,000(exclusive) None None None None
$30,000,000(inclusive)～$50,000,000(exclusive) None None None None
$50,000,000(inclusive)～$100,000,000(exclusive) None None None None
More than $100,000,000 None None None None
Total 7 people 7 people 7 people 7 people

29

(II) Remuneration for president and vice president

Unit: Thousands of NTD

Job title Name Salary (A) Salary (A) Severance and pension (B) Severance and pension (B) Bonus and allowance, etc.
(C)		 Bonus and allowance, etc.
(C)		 Profit-sharing remuneration for employees (D) Profit-sharing remuneration for employees (D) Profit-sharing remuneration for employees (D) Profit-sharing remuneration for employees (D) Total remuneration
(A+B+C+ D) and as a %
of the net profit after tax
(%)		 Total remuneration
(A+B+C+ D) and as a %
of the net profit after tax
(%)		 Remuneration
from investees
outside
subsidiaries or
from the parent
company
The
Company		 All
companies in
the financial
statements		 The
Company		 All
companies
in the
financial
statements		 The
Company		 All
companies
in the
financial
statements		 The Company All companies in the
financial statements		 The
Company		 All
companies
in the
financial
statements
Cash
amount		 Stock
amount		 Cash
amount		 Stock
amount
Chief StrategyOfficer Jui-Fu Liu 59,370 60,993 1,821 1,821 349 349 388 0 388 0 61,928
24.70%		 63,551
25.35%		 None
President Jui-LongLiu
VicePresident Chin-HsiangHsu
Vice President Chao-Lai Wu
Vice President AnthonyTseng
VicePresident Chen-Huan Li
Vice President Chun-ChengLi
Vice President Kuei-ShengYuan
VicePresident Shun-LiangHsieh
Vice President Bing-Sen Su
Vice President Chin-Fen Wu
VicePresident Nai-Cheng Cheng
Vice President Tsan-ChangLi
Sales Vice President Li-ChangWu
ProjectVicePresident Yen-Nien Hu
Sales Vice President Yu-LungHsueh
Sales Vice President Cheng-TungKo
Sales VicePresident Hsu-Hung Chen(Note1)
Sales Vice President Kuang-Keng Liang
(Note2)
Sales VicePresident Shu-ChingLin(Note 3)
Sales Vice President Ming-FengLi(Note 4)

Note 1: Took office on January 1, 2022.

Note 2: Took office on January 17, 2022. Note 3: Took office on July 1, 2022. Note 4: Took office on July 11, 2022.

30

Remuneration range table
Remuneration rangepaid to president and vice president Name of president and vice president
The Company All companies in the financial statements
Less than $1,000,000 Ming-Feng Li Ming-Feng Li
$1,000,000 (inclusive)～$2,000,000 (exclusive) None None
$2,000,000 (inclusive)～3,500,000 (exclusive) Jui-Fu Liu, Chin-Hsiang Hsu, Anthony Tseng,
Li-Chang Wu, Bing-Sen Su, Kuei-Sheng Yuan,
Nai-Cheng Cheng, Tsan-Chang Li, Yen-Nien Hu,
Yu-Lung Hsueh, Cheng-Tung Ko, Hsu-Hung Chen,
Kuang-Keng Liang, Shu-Ching Lin		 Jui-Fu Liu, Chin-Hsiang Hsu, Anthony Tseng,
Li-Chang Wu, Bing-Sen Su, Kuei-Sheng Yuan,
Nai-Cheng Cheng, Yen-Nien Hu, Yu-Lung Hsueh,
Cheng-Tung Ko, Hsu-Hung Chen, Kuang-Keng Liang,
Shu-Ching Lin
$3,500,000 (inclusive)～$5,000,000 (exclusive) Jui-Long Liu, Chao-Lai Wu, Chen-Huan Li,
Chun-Cheng Li, Shun-Liang Hsieh, Chin-Fen Wu		 Jui-Long Liu, Chao-Lai Wu, Chen-Huan Li,
Chun-Cheng Li, Shun-Liang Hsieh, Chin-Fen Wu,
Tsan-Chang Li
$5,000,000 (inclusive)～$10,000,000 (exclusive) None None
$10,000,000(inclusive)～$15,000,000(exclusive) None None
$15,000,000(inclusive)～$30,000,000(exclusive) None None
$30,000,000(inclusive)～$50,000,000(exclusive) None None
$50,000,000 (inclusive)～$100,000,000 (exclusive) None None
More than $100,000,000 None None
Total 21 people 21 people

31

(III) Names and distributions of employee profit-sharing remuneration to managerial officers

December 31, 2022
Unit: Thousands of NTD		 December 31, 2022
Unit: Thousands of NTD		 December 31, 2022
Unit: Thousands of NTD		 December 31, 2022
Unit: Thousands of NTD
Job title Name Stock amount Cash amount Total The total as a
percentage of net profit
after tax (%)
Managerial Officer Chief Strategy
Officer		 Jui-Fu Liu 0 2,307 2,307 0.92%
President Jui-Long Liu
Vice President Chin-HsiangHsu
Vice President Chao-Lai Wu
Vice President Anthony Tseng
Vice President Chen-Huan Li
Vice President Chun-Cheng Li
Vice President Kuei-Sheng Yuan
Vice President Shun-Liang Hsieh
Vice President Bing-Sen Su
Vice President Chin-Fen Wu
Vice President Nai-Cheng Cheng
Vice President Tsan-Chang Li
Sales Vice President Li-Chang Wu
Project Vice
President		 Yen-Nien Hu
Sales Vice President Yu-LungHsueh
Sales Vice President Cheng-Tung Ko
Sales Vice President Hsu-Hung Chen
Sales Vice President Kuang-Keng Liang
Sales Vice President Shu-Ching Lin
Sales Vice President Ming-Feng Li
Chief Technology
Officer		 Ching-Tzu Shih
Principal Division
Chief		 Jia-Chang Chang
Chief R&D Officer Tsai-Cheng Chen
Principal Division
Chief		 Tsai-Chi Sung
Principal Division
Chief		 Chih-Wei Wen
Chief Finance
Officer		 Li-Chueh Du
Principal Division
Chief		 Ming-Kun Lin
Principal Division
Chief		 Chien-Yi Li
Principal Division
Chief		 Chih-Chung Chen
Principal Division
Chief		 Feng-Lin Yen
Senior Assistant VP Mao-MingWang
Principal Division
Chief		 Ta-Yu Teng
Principal Division
Chief		 Po-Shu Hsueh
Assistant VP Kai-TsungWang

32

Managerial Officer Principal Division
Chief		 Cheng-Wu Shao
Senior Assistant VP Mei-Ling Yang
Senior Division
Chief		 Wen-Hsiung Yeh
Principal Division
Chief		 Kun-Ting Chiu
Division Chief Yen-Mei Lin
Principal Division
Chief		 Yung-Chen Yang
Division Chief Shu-Hua Liu
Principal Division
Chief		 Chao-Yi Wu
Senior Assistant VP Hung-Chun Chao
Division Chief Wen-Ching Tsai
Senior Assistant VP Chun-Yi Chao
Senior Division
Chief		 Chia-Yuan Yeh
Division Chief Chia-Ru Liu
Principal Division
Chief		 Te-Li Chen
Principal Division
Chief		 Yi-Lun Wang
Division Chief Chi-An Hsueh
Division Chief Chi-Hsiang Tang
Division Chief Nai-Fang Cheng
Senior Assistant VP Yao-Chang Chen
Principal Division
Chief		 Yi-Ming Chang
Division Chief Chih-Ping Chou
Division Chief Cheng-Yu Li
Senior Assistant VP Chia-Ching Li
Senior Assistant VP Tsang-Sung He
Principal Division
Chief		 Huang-Hsiang Yang
Division Chief Wen-Po Hsu
Division Chief Erh-Wei Dai
Principal Division
Chief		 Hui-Yi Lin
Senior Assistant VP Tien-Chih Yen
Assistant VP Hao-Cheng Yang
Principal Division
Chief		 Wan-Tan Lin
Principal Division
Chief		 Fu-Chien Cheng
Division Chief Hung-Yi Lin
Division Chief Chiung-We Hsu
Principal Division
Chief		 Chiu-Jung Chiang
Senior Assistant VP Shih-Fang Chang
Senior Assistant VP Chia-Hsu Hsiao
Assistant VP Li-Chun Lin
Acting Assistant VP Chin-Yu Chen
Principal Division
Chief		 Rui-Ching Lin
Division Chief Mei-Feng Chang
Senior Division
Chief		 Chih-Cheng Lin
Project Division
Chief		 Kang-Yuan Fan
Assistant VP Wei-Min Chen

33

Managerial Officer Division Chief Wei-Jen Cheng
Senior Division
Chief		 Yu-Ting Tseng
Assistant VP Yi-Chun Liu
Division Chief Ling-Hao Chen
Project Division
Chief		 Yen-Fu Chou
Principal Division
Chief		 Chin-Yi Liao
Division Chief Chun-Feng Lin
Project Assistant
VP		 Chun-Hua Liu
Project Assistant
VP		 Chung-Chieh Wu
Assistant VP Hung-Yu Hsu
Principal Division
Chief		 Min-Chung Huang
Assistant VP Po-Yi Chen
Division Chief Kuan-Chih Chen
Division Chief Chun-Fu Yang
Division Chief Ta-Jen Hsu
Division Chief Chung-Chun Lin
Senior Division
Chief		 Tai-Yuan Hu
Division Chief Shu-Chuan Chiu
Project Assistant
VP		 Yung-Kang Chang
Division Chief Hsu-Sheng Kao
Division Chief Meng-Hung Pan
Division Chief Fan-Ying Chang
Division Chief Yu-Hsiang Lin
Division Chief Yu-Chung Huang
Assistant VP Yu-Kang Tseng
Project Division
Chief		 Tsang-Wei Chang
Senior Division
Chief		 Wei-Pi Chou
Assistant VP Cheng-We Hung
Division Chief Chun-Tzu Chen
Assistant VP Chiu-Hua Lin
Acting Division
Chief		 Yi-Hsuan Lai
Project Assistant
VP		 Hsin-Jung Lu
Project Assistant
VP		 Jo-Han Hsieh
Acting Assistant VP Chia-Yu Chen
Project Division
Chief		 Ta-Chung Kuo
Project Division
Chief		 Yu-Hsiang Lin
Project Division
Chief		 Chih-Shan Chen
Division Chief Ching-Wang Huang
Division Chief Yuan-Chuan Yeh
Senior Division
Chief		 Che-Zhe Liu
Project Assistant
VP		 Yung-Pin Du
Division Chief Hsiang-Teng Yeh
Project Division
Chief		 Ching-Hsun Hou
Division Chief Yu-Na Chiu

34

Managerial Officer Division Chief Chih-Kai Hsu
Corporate
Governance Officer		 Chun-Yen Chen
Division Chief Shan-Mao Cheng
Assistant VP Ying-Ya Wang
Assistant VP Chen-Kai Hua
Acting Assistant VP Yu-Hsuan Kuo
Project Assistant
VP		 Hsuan-Fa Huang
Project Assistant
VP		 Kuo-Shu Hsu
Division Chief Yung-Ching Chen
Division Chief Chung-Yi Lin
Division Chief Hsin-Yi Li
Acting Division
Chief		 Yu-Chia Hsiao
Division Chief Ting-Jung Chang
Division Chief Chia-Yi Tsao
Division Chief Fu-Yuan Wen
Division Chief Yi-Feng Lai
Project Assistant
VP		 Yi-Ling Hsu
Project Assistant
VP		 Hung-Jen Hsiao
Project Assistant
VP		 Yi-Cheng Wu
Project Assistant
VP		 Sheng-Yu Chen
Division Chief Ling-Hao Chen
Project Division
Chief		 Chun-Wen Yu
Division Chief Cheng-Heng Deng
Acting Assistant VP Ying-Ying Hsu
Project Division
Chief		 Chi-Cheng Chih
Principal Division
Chief		 Te-Kuei Chiu

(IV) Compare and describe the total remuneration paid to directors, supervisors, presidents, and vice presidents in the most recent 2 years by the Company and all companies in the consolidated financial statements as a % of the net profit after tax on the parent company only or standalone financial statements, and explain the policies, criteria, combination, the procedures for determining remuneration and the correlation to operating performances and future risks:

  1. The ratio of total remuneration paid by the Company and by all companies included in the consolidated financial statements for the two most recent fiscal years to directors, supervisors, presidents and vice presidents of the Company, to the net income.

Unit: Thousands of NTD,%

Item
Title		 The Company The Company The Company The Company All companies in the consolidated
financial statement		 All companies in the consolidated
financial statement		 All companies in the consolidated
financial statement		 All companies in the consolidated
financial statement
2021 2022 2021 2022
total to net profit
after tax %		 total to net profit
after tax %		 total to net profit
after tax %		 total to net profit
after tax %
Directors 8,227 3.81% 8,465 3.38% 8,765 4.06% 9,037 3.60%
Supervisors 134 0.06% 0 0% 134 0.06% 0 0%
President and vice
president		 53,712 24.89% 61,928 24.70% 55,716 25.82% 63,551 25.35%
Netprofit after tax 215,822 - 250,729 - 215,822 - 250,729 -

Note: The Company replaced supervisors with the Audit Committee from July 29, 2021.

  1. The policies, standards, and portfolios for the payment of remuneration, the procedures for determining remuneration, and the correlation with business performance:

  2. The remuneration for the above-mentioned personnel is based on the Company's Articles of Incorporation, the "Remuneration System for Directors, Members of Functional Committees and Managerial Officers" and

35

the Company’s measures for determining salaries, and is subject to the Remuneration Committee's review and approval.

  • (1)Article 21 of the Company's Articles of Incorporation: If the Company makes a profit in a fiscal year, it shall allocate no less than 3% of the balance as employee remuneration, which shall be distributed in stock or cash as per the resolution by the Board of Directors. The recipients shall include employees of the controlling company or subsidiaries who met certain criteria. The distribution of employee remuneration shall be reported to the shareholders’ meeting. However, when the Company still has a cumulative deficit, it shall reserve an amount to compensate it first and then allocate an amount for employee remuneration according to the percentage set out in the preceding paragraph

  • (2)Article 18 of the Company's Articles of Incorporation: The Board of Directors is authorized to determine the remuneration to the Chairperson and directors based on their involvement in the Company's operations, the values of their contributions, and the general standard in the industry. All directors may be paid with honoraria depending on the actual situation.

  • (3)The performance evaluation and remuneration for directors and managerial officers shall be handled with reference to the usual level of remuneration in the industry, taking into account the individual's time invested, responsibilities taken, achievement of personal goals, performance in other positions, the remuneration offered by the Company in recent years for the same position, and the achievement of the Company’s short-term and long-term business goals and the Company's financial position and the reasonableness of the correlation between personal performance and the Company's operating performance and future risks.

  • (4)The Company's directors are currently paid only with the fixed monthly salary, travel expenses or attendance fees, and no variable remuneration .

  • (5)In regard to the salary and remuneration for managerial officers of the Company, fixed salaries are determined based on education, work experience, professional skills, job duties, etc. The principles for determining non-fixed salaries are based on the achievement rate of individual performance, the achievement of departmental performance management indicators, and the overall operating performance of the Company, as well as the assessment of the correlation between the external competitive environment, the future development trend of the industry and future risks, with timely review of the salary and remuneration system.

  • (6)The Remuneration Committee has reviewed and approved the performance evaluation of the directors and functional committees and the salary and remuneration for managerial officers for 2022, and has submitted the results to the Board of Directors for discussion and approval.

36

IV. Operations of corporate governance

(I) Operations of the Board of Directors:

The Board of Directors met 5 times during 2022 and the attendance of the directors was as follows: The average percentage of attendance in person of all directors was 94.29%, and all independent directors attended all meetings in person.

Job title Name Number of
attendance in
person		 Number of
attendance
by proxy		 Percentage of
attendance in
person (%)		 Remark
Chairman Jui-Fu Liu 5 0 100% None
Director Jui-Long Liu 5 0 100% None
Director Po-Wen Wang 5 0 100% None
Director Chih-Chun Liu 3 0 60% None
Independent Director Che-Fu Kung 5 0 100% None
Independent Director Wang-Ying Yu 5 0 100% None
Independent Director Chung-Lieh Kuo 5 0 100% None
Other matters required to be recorded:
I.
If the operations of the Board of Directors is under any of the following circumstances, the date, period,
motion content, all independent directors’ opinions and the Company’s handling of their opinions should
be describe:
1. Matters listed in Article 14-3 of the Securities and Exchange Act: The company’s Audit Committee
was set up. The provisions of Article 14-3 of the Securities and Exchange Act are not applicable since
then. Please refer to page 38 of the Annual Report for information on the operations of the Audit
Committee.
2. In addition to the previous matters, other board meeting resolutions that have been opposed or reserved
by independent directors with records or written statements: None.
II. In the implementation of a director’s recusal for being an interested party in a motion, the director’s name,
the motion content, the recusal reasons and his or her participation in voting should be stated: None.
III. The Company should disclose information on the periodicity and duration, scope, method and content of
the self-evaluation (or peer evaluation) by the board of director, and fill out Exhibit 1 on the
implementation of the board evaluation.
IV. Evaluation of the current and most recent year's objectives for enhancing the functions of the Board of
Directors (e.g., establishing an audit committee, enhancing information transparency, etc.) and their
implementation:
1. The Company has established the rules of procedure for the Board of Directors' meetings to
institutionalize the operations of the Board of Directors, and has posted the attendance of directors
and supervisors in MOPS.
2. The Company has established a Remuneration Committee and established the "Remuneration
Committee Charter". On July 29, 2021. The Fifth Remuneration Committee was formed by the three
independent directors.
3. The Audit Committee of the Company was formed by the three independent directors on July 29,
2021, and the "Audit Committee Charter" has been established.
4. The Company has established the "Rules Governing the Scope of Powers of Independent Directors".
5. The Company has taken out liability insurance for directors and managerial officers to diversify the
legal risks of directors and managerial officers.
6. The Company has established the “Rules for Performance Evaluation of the Board of Directors” and
has completed the performance evaluation of the Board of Directors for 2022 and submitted it to the
first Board of Directors meeting in 2023.
7. The Company has established the "Standard Operating Procedures for Handling Directors' Requests"
and has approved the establishment of a corporate governance officer at the Board of Directors'
meeting on March 18, 2021 to enhance corporate governance operations.

37

Exhibit 1: Implementation of the board evaluation.

Evaluation
frequency		 Evaluation period Evaluation scope Evaluation method Evaluation content
Once a year January 1, 2022 to
December 31, 2022		 Board of Directors Internal self-evaluation
by the Board of
Directors		 (1) The extent of participation in the
Company's operations.
(2) Improvement in the quality of the
board's decision-making.
(3) Composition and structure of the board.
(4) Election and continuing education of
directors.
(5) Internal control.
Individual board
member		 Board member self-
evaluation		 (1) Alignment of the Company's objectives
and tasks.
(2) Perception of directors’ responsibilities.
(3) The extent of participation in the
Company's operations.
(4) Internal relationship management and
communication.
(5) Professionalism and continuing education
of directors.
(6) Internal control.
Audit Committee Self-evaluation by
Audit Committee
members		 (1) The extent of participation in the
Company's operations.
(2) Perception of functional committee’s
responsibilities.
(3) Improvement in the quality of the
functional committee's decision-making.
(4) Composition and appointment of
functional committee members.
(5)Internalcontrol.
Remuneration
Committee		 Self-evaluation by
Remuneration
Committee members

  • (II)Operations of the Audit Committee or participation of supervisors in board operations:

  • Operations of the Audit Committee:

  • (1) The Audit Committee of the Company was established on July 29, 2021 in accordance with the law, and consists of all independent directors, with a total of three members, and operates in accordance with the "Audit Committee Charter", and meets at least once a quarter for the primary purpose of overseeing the following matters:

    • a. Fair presentation of the Company's financial statements

    • b. Appointment (dismissal), independence and performance of attesting CPAs

    • c. Effective implementation of internal control.

    • d. Compliance with the relevant laws and regulations.

  • (2) The tasks and responsibilities of the Audit Committee are as follows:

    • a. Establishment of or amendment to internal control system pursuant to Article 14-1 of the Securities and Exchange Act.

    • b. Evaluation of the effectiveness of the internal control system.

    • c. Adoption or amendment, pursuant to Article 36-1 of the Securities and Exchange Act, of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, or endorsements or guarantees for others.

    • d. Matters that involve the self interests of the directors.

    • e. Material assets or derivative transactions

    • f. The lending of funds, endorsement, or guarantee in huge sum.

    • g. The offering, issuance, or private placement of any equity-type securities.

    • h. The appointment, dismissal, or remuneration of attesting CPAs.

    • i. The appointment or discharge of the finance, accounting, or internal audit officer.

    • j. The annual financial statements signed or sealed by the chairman, managerial officer and accounting officer, and the second quarter financial statements subject to audit and attestation

38

by CPAs.

  • k. Other significant matters required by the Company or the competent authorities.

  • (3) The Company's Audit Committee met 5 times in 2022 and the attendance of the independent

directors was as follows:

Job title Name Number of
attendance in
person		 Number of
attendance
by proxy		 Percentage of
attendance in
person (%)		 Remark
Independent Director Che-Fu Kung 5 0 100% None
Independent Director Wang-Ying Yu 5 0 100% None
Independent Director Chung-Lieh Kuo 5 0 100% None

  • (4) Other matters required to be recorded:

  • a. If the operation of the Audit Committee is under any of the following circumstances, the date, period, motion content, the content of the objections, reservations or major recommendations of the independent directors, resolution of the Audit Committee and the Company’s handling of the Audit Committee’s opinions should be described:

  • i. Matters listed in Article 14-5 of the Securities and Exchange Act:

i. Mattersliste din Article14-5 ofthe Securities andExchangeAct:
Date of the Audit
Committee meeting		 Motion content Matters
listed in
Article 14-5
of the
Securities
and
Exchange
Act		 Objections,
reservations or
major
recommendations
of the
independent
directors
1st meeting in 2022
2022.03.18		 Review of the financial statements and business
report for 2021		 V None
2021 earnings distribution proposal None
Amendments to the “Procedures for Acquisition
and Disposal of Assets”		 V None
Evaluation of the independence and competency
and appointment of attesting CPAs		 V None
2021"Assessment of the Effectiveness of Internal
Control System" and "Internal Control System
Statement"		 V None
Plan to serve as the guarantor for bank financing
of subsidiaries		 V None
2nd meeting in 2022
2022.05.11		 Review of the financial statements for 1Q2022 None
Plan to serve as the guarantor for bank financing
of subsidiaries		 V None
3rd meeting in 2022
2022.08.10		 Review of the financial statements for 2Q2022 None
Renewal of office lease upon expiration V None
Plan to serve as the guarantor for bank financing
of subsidiaries		 V None
4th meeting in 2022
2022.11.10		 Review of the financial statements for 3Q2022 None
Formulation of the audit plan for 2023 None
Plan to serve as the guarantor for bank financing
of subsidiaries		 V None
5th meeting in 2022
2022.12.15		 Plan to serve as the guarantor for bank financing
of subsidiaries		 V None
1st meeting in 2023
2023.03.17		 Review of the financial statements and business
report for 2022		 V None
2022 earnings distribution proposal None

39

Establishment of the "Pre-Approval Policy for
Non-Assurance Services" and pre-approval list of
non-assurance services		 V None
Evaluation of the independence and competency
and appointment of attesting CPAs		 V None
2022"Assessment of the Effectiveness of Internal
Control System" and "Internal Control System
Statement"		 V None
Plan to serve as the guarantor for bank financing
of subsidiaries		 V None
Resolutions: The motions listed above by the Audit Committee were approved by all members present.
The Company's handling of the Audit Committee's opinions: The resolutions were submitted to the Board of
Directors and approved by all directors present.

  • ii. Other than the matters in the preceding paragraphs, resolutions not approved by the Audit Committee but approved by two-thirds or more of all directors: None.

  • (5) In the implementation of an independent director’s recusal for being an interested party in a motion, the independent director’s name, the motion content, the recusal reasons and his or her participation in voting should be stated: None.

  • (6) Communications among independent directors, internal audit officer and CPAs:

  • a. The Company's independent directors communicate with the internal audit officer and CPAs mainly through communication meetings or e-mails.

  • b. At least once a year, a separate meeting is held between the independent directors and the internal audit officer and the CPAs, without the presence of the regular directors and the management. If there is a major issue or if the independent directors, the internal audit officer and CPAs deem it necessary to communicate independently, they may convene a meeting from time to time to communicate.

  • c. The internal audit officer of the Company shall submit audit reports and follow-up reports to the independent directors in the month following the completion of the audit work, and shall attend the Board of Directors' meeting to report the implementation of the annual audit plan and internal control operations.

  • d. The internal audit officer reports individually to the independent directors at the Audit Committee meetings held quarterly on the implementation of the audit plan, significant findings and recommendations for improvement.

  • e. The Company's internal audit officer holds communication meetings with the independent directors and CPAs at least twice a year to discuss matters including the CPAs’ audit matters and results of the financial statements, financial position reports, the implementation of internal controls, other communication matters required by laws and regulations, and the impact of changes in laws and regulations on the Company's accounting practices.

f. Communications among independent directors, internal audit officer and CPAs are as follows:

Meeting date Communication method Communication matters Communication
results
March 18, 2022 Pre-board meeting
discussion		 1. CPAs communicated the results
of the financial statement audit
with the governance unit
(includes key audit matters and
others).
2. Others: Renewal of laws and
regulations.		 All independent
directors present had
no other opinions on
the relevant
communication
matters.
March 18, 2022 Audit Committee 1. Report on the implementation
of audit operations.
2. Discussion about the 2021
"Assessment of the Limitation
of Internal Control System" and
"Internal Control System
Statement".		 All independent
directors present had
no other opinions.
May 11, 2022 Audit Committee Report on the implementation of
audit operations.		 All independent
directors present had
no other opinions.

40

August 10, 2022 Audit Committee Report on the implementation of
audit operations.		 All independent
directors present had
no other opinions.
November 10, 2022 Pre-board meeting
discussion		 1. The review scope, time, and
key audit matters of the annual
financial statements.
2. Related guidelines of audit
quality indicators (AQI).		 All independent
directors present had
no other opinions on
the relevant
communication
matters.
November 10, 2022 Audit Committee 1. Report on the implementation
of audit operations.
2. Discussion about the
formulation of 2023 audit plan.		 All independent
directors present had
no other opinions.
March 17, 2023 Pre-board meeting
discussion		 1. CPAs communicated the results
of the financial statement audit
with the governance unit
(includes key audit matters and
others).
2. Evaluation report of audit
quality indicators (AQI).
3. Others: Renewal of laws and
regulations.		 All independent
directors present had
no other opinions on
the relevant
communication
matters.
March 17, 2023 Audit Committee 1. Report on the implementation
of audit operations.
2. Discussion about the 2022
"Assessment of the Limitation
of Internal Control System" and
"Internal Control System
Statement".		 All independent
directors present had
no other opinions.

41

(III) Corporate Governance - Implementation Status and Deviations from the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and the Reasons:

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
I. Does Company follow “Taiwan Corporate Governance
Implementation” to establish and disclose its corporate
governance practices?		 V The "Corporate Governance Best Practice Principles" were established and
approved by the Board of Directors on November 7,2014, and all operations
are carried out in accordance with these Principles, which have been disclosed
on the Company's website and the Market Observation Post System.		 None
II. Shareholding structure & shareholders’ rights
(I)
Does Company have Internal Operation Procedures
for handling shareholders’ suggestions, concerns,
disputes and litigation matters. If yes, has these
procedures been implemented accordingly?
(II) Does Company possess a list of major shareholders
and beneficial owners of these major shareholders?
(III) Has the Company built and executed a risk
management system and “firewall” between the
Company and its affiliates?
(IV) Has
the
Company
established
internal
rules
prohibiting
insider
trading
on
undisclosed
information?		 V
V
V
V		 (I)
The Company has a spokesperson and an acting spokesperson to deal
with shareholders' suggestions and questions. In addition, the
Company has a mailbox on the Company's website for investors to
ask questions about shareholders’ proposals or disputes.
(II) The Company regularly discloses the names of major shareholders
and the ultimate controllers of major shareholders in accordance with
relevant laws and regulations, and reports information on the changes
in accordance with the regulations.
(III) The business and financial affairs of the Company and affiliates are
operated independently, and the management rules have been
established and implemented in accordance with the relevant
regulations of the competent authorities.
(IV) The Company has established the "Procedures for Handling Material
Inside Information and Procedures for the Prevention of Insider
Trading" and the "Procedures for Ethical Management and Guidelines
for Conduct" in accordance with the relevant regulations of the
competent authorities to maintain the fairness of securities trading
market, which are posted on the internal website and the Company's
website to prohibit any conduct that may involve insider trading, and
also providesrelated educationand promotion.		 None
III. Composition and Responsibilities of the Board of
Directors
(I) Does the board of directors formulate diversity
policies,
specific
management
objectives
and
implement them?		 V (I) 1. The Company has established the "Corporate Governance Best
Practice Principles" and the composition of the Board of Directors
is determined by taking into consideration the diversity of the
Board of Directors, the members of which not only possess the



None

42

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
knowledge, skills and qualities necessary to perform their duties,
but also have diverse backgrounds in industry, academia and
knowledge.Please refer to the Annual Report on page14”
(IV)Disclosure of professional qualifications of directors and
independence of independent directors”for their educations and
experiences. The implementation status of the Company's policy
on diversity of the board members by individual directors is as
follows, mainly comprising:
A.Basic criteria and values of directors, including gender, age,
nationality, and culture, etc.
B.Directors' professional knowledge and skills, including
professional background (such as law, accounting, industry,
finance, marketing or technology), professional skills and
industry experience, etc.
C.Directors’ abilities include operational judgment, accounting
and
financial
analysis,
business
management,
crisis
management,
industry
knowledge,
international
market
perspective, leadership, and decision-making ability.
2. The Company’s achievement of the diversity of the board members
is detailed on page15of the Annual Report.
3. The Company's Board of Directors has seven seats, of which three
are independent directors and two are concurrently managerial
officers of the Company, representing 29% of the total number of
directors. No more than one-third of the directors are concurrently
managerial officers of the Company. Nor more than half of the
directors are spouses or relatives within second degree of kinship
of each other. The percentage of independent directors is 43%. Two
independent directors have a tenure of 3 to 9 years, and one
independent director has a tenure of less than 3 years. Two of the
Company's directors are aged 71 or older, four are aged 61 to 70,
and one is aged 41 to 50. The Company has two female directors
and the percentage of female directors is 29%, while the target of
increasingto more than 25% has been achieved. The Company

























43

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
(II) Other than the Compensation Committee and the
Audit Committee which are required by law, does the
Company plan to set up other Board committees?
(III) Has the Company established methodology for
evaluating the performance of its Board of Directors,
on an annual basis, reported the results of performance
to the Board of Directors, and use the results as
reference for directors’ remuneration and renewal?		 V
V		 aims to increase the number of female directors to more than one-
third in the future.
(II)
The Company has established the Remuneration Committee and the
Audit Committee in accordance with the law, with three members
consisting of all independent directors, and will establish other
functional committees in the future depending on the actual operational
need.
(III)
The Company has established the "Rules for Performance Evaluation
of the Board of Directors" as approved by the Board of Directors on
March 22, 2019, which requires a review of the Board of Directors,
individual members of the Board of Directors, and members of
functional committees (including the Remuneration Committee and the
Audit Committee) at least once a year. The evaluation results will be
used as reference for the nomination of directors.
1.The evaluation method includes internal self-evaluation by the Board of
Directors, self-evaluation by the Board members, self-evaluation by the
members of the functional committees or other appropriate methods for
performance evaluation.
2.The performance evaluation of the Board of Directors of the Company
shall include at least the following five major aspects:
(1) The extent of participation in the Company's operations.
(2) Improvement in the quality of the board's decision-making.
(3) Composition and structure of the board.
(4) Election and continuing education of directors.
(5) Internal control.
The performance evaluation of board members should include at least
the following six major aspects:
(1) Alignment of the Company's objectives and tasks.
(2) Perception of directors’ responsibilities.
(3) The extent of participation in the Company's operations.
(4) Internal relationship management and communication.
(5) Professionalism and continuing education of directors.
(6) Internalcontrol.













44

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
The performance evaluation of the functional committees (including the
Remuneration Committee and the Audit Committee) should include at
least the following five major aspects:
(1) The extent of participation in the Company's operations.
(2) Perception of functional committee’s responsibilities.
(3) Improvement in the quality of the functional committee's decision-
making.
(4) Composition and appointment of functional committee members.
(5) Internal control.
The Board of Directors' performance evaluation indicators shall be
determined in accordance with the Company's operations and needs,
and shall be appropriate for the Company's performance evaluation.
The evaluation criteria shall be revised and adjusted according to the
needs of the Company, and the scores may be weighted according to
each evaluation aspect.
3.The Company performs the internal performance evaluation of the Board
of Directors once a year in accordance with the evaluation procedures
and evaluation indicators of "Rules for Performance Evaluation of the
Board of Directors".
The results of the internal performance evaluation shall be completed
and provided to the Board of Directors by the end of the first quarter of
the following year. The evaluation scope shall include the performance
evaluation of the Board of Directors as a whole, individual board
members and functional committees.
The evaluation method includes internal self-evaluation by the Board
of Directors, self-evaluation by the Board members, self-evaluation by
the members of the functional committees or other appropriate methods
for performance evaluation. The results of the performance evaluation
shall be used as a reference in the selection or nomination of directors.
4.The performance evaluation of the Board of Directors for the year 2022
was completed in February 2023 and the evaluation results were
submitted to the Board of Directors on March 17, 2023. According to
the self-evaluation results oftheBoard of Directors, boardmembers,


















45

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
(IV) Does the Company regularly evaluate its attesting
CPAs’ independence?		 V Audit Committee and Remuneration Committee, the performance
evaluation of the Board of Directors, board members, Audit Committee
and Remuneration Committee are all above the standard, which
indicates that the overall operations of the Board of Directors and
functional committees of the Company are good.
(IV) The Audit Committee and the Board of Directors of the Company
evaluate the independence and competency of the attesting CPAs in
accordance with the regulations every year. In addition to requesting the
attesting CPAs to issue the "Statement of Independence" and "Audit
Quality Indicator (AQI) Report", the Company also examines whether
the attesting CPAs meet the independence and competency according to
the thirteen indicators of the five major scopes of AQI and an number of
evaluation criteria. The evaluation results will also be used as the basis
for the Audit Committee and the Board of Directors to approve the
appointment of the CPAs. Based on the results of the most recent
evaluation of the independence and competency of the Company's
attesting CPAs (please refer to Note 1), the Company's attesting CPAs
meet the independence and competency requirements. On March 17,
2023, the Audit Committee and the Board of Directors resolved to
approve the "evaluation of independence and competency as well as
appointment ofthe attesting CPAs".

















IV. Does the Company appoint competent and appropriate
corporate
governance
personnel
and
corporate
governance officer to be in charge of corporate
governance affairs (including but not limited to furnishing
information required for business execution by directors,
assisting directors’ compliance of law, handling matters
related to board meetings and shareholders’ meetings
according to law, handling company registration and
change registration , and recording minutes of board
meetings and shareholders’ meetings)?		 V 1. The Company’s Corporate Governance Group is responsible for corporate
governance-related matters, and the Board of Directors resolved on March
18, 2021 that Chun-Yen Chen, Manager of the Accounting Office of the
Finance Division, be appointed as the Corporate Governance Officer. She
has at least three years of experience in the management of finance, stock
affairs and meeting administration of a public company and has completed
continuing professional education as required by law.
2. Corporate governance related matters and scope of authority mainly include
the following
(1) Provide information necessary for directors to carry out their business.
(2) Administer meetings oftheBoard of Directors and shareholders'







None

46

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
meetings in accordance with the law.
(3) Handle business registration and change registration for the Company.
(4) Prepare minutes of meetings of the Board of Directors and
shareholders.
(5) Assist directors to take office and pursue continuing education.
(6) Assist directors in complying with the law.
(7) Assist the Board of Directors in strengthening its performance.
(8) Report to the Board of Directors the results of its review of the
qualifications of independent directors at the time of their nomination,
election and during their term of office in compliance with the
relevant laws and regulations.
(9) Handle matters related to the change of directors.
(10) Protect the interests of stakeholders and uphold equal treatment of
shareholders.
3. Implementation status of the above matters in 2022:
(1) Handled matters related to the change of directors in accordance with
the law:
Formulated the meeting agenda for Board of Directors’ and Audit
Committee’s meetings, sent out meeting notices, meeting materials
and minutes. In 2022, the Board of Directors had 5 meetings and the
Audit Committee had 5 meetings.
(2) Administered the annual regular shareholders' meetings in accordance
with the law:
Registered for the shareholders' meeting, prepared the meeting notice,
handbook and minutes, and administered the regular shareholders'
meeting on June 15, 2022 to amend the Articles of Incorporation and
completed the change registration for the Company in accordance
with the regulations.
(3) Assisted in the communications among independent directors,
internalaudit officerand attesting CPAs.















None

47

  • (4) Published material information in accordance with the law and ensured the legality and accuracy of the contents of material information published.

  • (5) Assist directors in complying with various laws and best practice principles and to assisted in arranging continuing educations for directors.

  • (6) Handled the purchase of liability insurance for directors and managerial officers.

  • (7) Administered the performance evaluation of the Board of Directors for the year 2022, which was reported to the Board of Directors in its first meeting in 2023.

  • (8) Continued to implement and strengthen corporate governance.

  • Continuing educations of the Corporate Governance Officer:

Training date Organizer Course name Training
hours		 Total
training
hours in the
year
2021.07.16 Accounting
Research and
Development
Foundation		 Latest Policy Developments
and Internal Control
Management Practices
Related to “Self-Prepared
Financial Statements”		 6.0 18.0
2021.10.19 Using ESG to Improve
Corporate Strategies and
Responding to Sustainable
Financial Trends		 6.0
2021.11.10 Analysis of the latest
corporate governance
policies and the legal audit
practice of "corporate
governance personnel"
auditing		 6.0

48

Evaluation Item Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
Training date Organizer Course name Training
hours		 Total
training
hours in the
year
2022.10.26 Accounting
Research and
Development
Foundation		 Common Deficiencies of
"Financial Statements
Review" and Analysis of
Important Internal Control
Regulations		 6.0 12.0
2022.10.31 Latest Policy
Developments and Internal
Control Management
Practices Related to “ESG
Sustainability” and “Self-
Prepared Financial
Statements”		 6.0
V. Has the Company established a means of communicating
with its Stakeholders (including but not limited to
shareholders, employees, customers, suppliers, etc.) or
created a Stakeholders Section on its Company website?
Does the Company respond to stakeholders’ questions on
corporateresponsibilities?		 V The Company has a spokesperson and an acting spokesperson, and provides a
communication channel for investors and stakeholders to ask questions through
the Company's website. The Company has set up a stakeholder area on the
Company's website, where stakeholders can communicate with each other by
telephone or email disclosed on the website as needed on issues of concern.



None
VI. Has the Company appointed a professional registrar for
its Shareholders’ Meetings?		 V The Company has appointed a professional stock affairs agency, CAPITAL
SECURITIES CORP., to administer shareholders’ meetings and shareholder
services.

None
VII. Information Disclosure
(I)
Has the Company established a corporate website to
disclose information regarding its financials, business
and corporate governance status?
(II) Does the Company use other information disclosure
channels (e.g. maintaining an English-language
website, designating staff to handle information
collection and disclosure, appointing spokespersons,
webcastinginvestors conference etc.)?





V
V		 (I)
The Company has set up a website with "Investor Relations" and
"Sustainable Development ESG"areas to disclose information on
financial and business matters and sustainable development.
(II) The Company has dedicated personnel to be responsible for the collection
and disclosure of material information of the Company, and inputting the
information into the Market Observation Post System and the Company's
website on a regular basis, has implemented a spokesperson system in
accordance withtheregulations and, andhas placedinformation related





None

49

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
(III) Does the Company announce and report the annual
financial statements within two months after the end
of the fiscal year, and announce and report the first,
second, and third quarter financial statements as well
as the operating status of each month before the
prescribed deadline?



V to the Company's past earnings calls on the Company's website.
(III) The annual financial reports, the first, second, and third quarter financial
reports, and the monthly operating results of the Company are announced
and reported before the prescribed deadline.
VIII. Has the Company disclosed other information to
facilitate a better understanding of its corporate
governance practices (e.g. including but not limited to
employee rights, employee wellness, investor relations,
supplier relations, rights of stakeholders, directors’
training
records,
the
implementation
of
risk
management policies and risk evaluation measures, the
implementation of customer relations policies, and
purchasing liability insurance for directors)?		 V 1. Employees' rights and interests: The Company protects employees' rights
and interests in accordance with the Labor Standards Act, the Gender
Equality Act, the Sexual Harassment Prevention Act, and other relevant
laws and regulations.
2. Employee care: The Company provides relevant welfare system,
complete education and training, and good communication channels to
establish a trusting relationship with employees.
3. Investor relations: The Company has dedicated personnel to provide
services and a stock affairs unit to handle shareholders' suggestions.
4. Supplier relations: The Company selects suitable suppliers based on their
delivery quality, timeliness, and after-sales service, and signs distribution
contracts for the products of the partners we represent. We review the
cooperation relationship between the two parties according to the contract
period, and quote and compare multiple vendors for products in the
market channel simultaneously to establish a stable procurement network,
and require suppliers to comply with corporate social responsibility
policies.
5. Stakeholders’ rights: Stakeholders may communicate with the Company
and make suggestions to protect their legitimate rights and interests.
6. Continuing educations of directors: Please refer to the description (Note
2) of Continuing education of directors in this Annual Report.
7. Implementation status of risk management policy and risk measurement
standards: The Company has established the risk management policy,
which together with the risk measurement standards have been
implemented by dedicated personnel and the implementation status is
good.


















None

50

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
8. Implementation of customer policy: The Company maintains stable and
good relationships with its customers to generate profits for the Company.
9. The Company’s purchase of liability insurance for directors and
managerial officers: The Company purchases liability insurance for
directors and managerial officers every year to strengthen corporate
governance and reduce the risks borne by directors, managerial officers
and the Company, which are reported on the Market Observation Post
System.





IX. The improvement status for the result of Corporate Governance Evaluation announced by Taiwan Stock Exchange for the 2022 Corporate Governance Evaluation：
Improved status for the non-scoring items:
Evaluation Index
Improved status
Does the Company upload its annual financial statements in English 7 days before the regular
shareholders' meeting?【“If the English version of the annual financial statements is uploaded
16 days before the regular shareholders' meeting, one additional point will be added to the
total score.】
The Company plans to upload its annual financial statements in English 7 days
(or 16 days) before the 2023 regular shareholders' meeting.
Priorities for improvement:
Evaluation Index
Priorities for improvement
Does the Company disclose its interim financial statements in English within two months of
the reporting deadline for the Chinese version of the interim financial statements?
The Company plans to disclose its consolidated financial statements in English
on a quarterly basis starting from 2023.

51

Note 1:

Note 1:
(1) Evaluation form of the independence and competency of attesting CPAs
Evaluation item Evaluation
results		 Compliance with
Independence
1. If the CPA has a direct or material indirect financial interest in the Company? No Yes
2. If the CPA has any financing or guarantee dealings with the Company or its directors and supervisors? No Yes
3. If the CPA has significant close business relationships with the Company? No Yes
4. If the CPA Group has a potential employment relationship with the Company? No Yes
5. If the CPA and the Company agreed on contingent professional fees related to audit cases? No Yes
6. If the CPA and any audit team member currently or within the most recent two years has served as a director,
supervisor, managerial officer or position that has a significant influence on audit cases?		 No Yes
7. If the CPA had provided any non-audit services to the Company that will directly affect the important matters of
audit cases?		 No Yes
8. If the CPA has advertised or brokered any shares or other securities issued by the Company? No Yes
9. If the CPA has acted as a defender for the Company or coordinated conflicts with other third parties on behalf of the
Company?		 No Yes
10. If the CPA is related to the directors, supervisors, managerial officers or persons who have significant influence on
the audit cases of the Company?		 No Yes
11. If any other practicing CPA who left the CPA firm in the last year has served as a director, supervisor, managerial
officer or position that has a significant influence on audit cases?		 No Yes
12. If the CPA ever received any gifts or presents of significant value from the Company or its directors, supervisors or
managerial officers?		 No Yes
13. If the CPA is requested to accept improper choices by management in accounting policies or improper disclosures
in the financial statements?		 No Yes
14. If the CPA is pressed to improperly reduce the amount of audit work to be performed in order to reduce the
professional fees?		 No Yes
15. Has the Company not changed its attesting CPAs for seven consecutive years or have its attesting CPAs been
disciplined or compromised their professionalism or independence?		 No Yes

52

(2) AQI Independence and Competency Assessment Form for Attesting CPAs

AQI Key measurement points and level Compliance
with Audit
Quality
Indicators
Scope 1
Professionalism		 (1-1) Audit experience Do the senior auditors have sufficient audit experience to perform the audit
work?		 CPA firm level
Audit engagement level		 Yes
(1-2) training hours Do the CPAs and senior auditors receive sufficient annual education and training
to continue to acquire professional knowledge and skills?
CPA firm level		 Yes
(1-3) Turnover rate Does the CPA firm maintain sufficient experienced human resources? CPA firm level Yes
(1-4) Professional supports Does the CPA firm have sufficient professional personnel (such as appraisers) to
support the audit team?		 CPA firm level Yes
Scope 2
Quality control		 (2-1) CPAs’ workload Are the CPAs overloaded with audit engagements? CPA firm level
Audit engagement level
Yes
(2-2) Audit involvement Is the involvement of the audit team at each stage of the audit engagement
appropriate?		 CPA firm level
Audit engagement
level		 Yes
(2-3) Engagement quality
control review (EQCR)		 Do CPAs devote sufficient hours to perform reviews of the audit engagement
(EQCR)?		 CPA firm level
Audit engagement level
Yes
(2-4) Quality control support
capability		 Does the CPA firm have sufficient quality control manpower to support the audit
team?
CPA firm level		 Yes
Scope 3
Independence		 (3-1) Non-audit service fees Effect of the proportion of non-audit service fees on Independence Audit engagement level
Yes
(3-2) Client familiarity Effect of the cumulative number of years of attestations to annual financial
statements provided by the CPA firm on independence		 Audit engagement level
Yes
Scope 4 (4-1) External inspection
deficiencies and
disciplines		 Are the quality control and audit engagements of the CPA firm performed in accordance
with the relevant laws and regulations?		 CPA firm level
Audit engagement level
Yes

Supervision		 (4-2) Improvements required
b cometent authorities		 Are the quality control and audit engagements of the CPA firm performed in accordance
with the relevant laws and reulations?		 CPA firm level
Audit enaement level
Y
y p
in letters		 g gg
es
Scope 5
Innovation
capabilities		 (5-1) Innovation planning or
initiatives		 The CPA firm's commitment to improving audit quality, including the CPA
firm’s innovation capabilities and planning.		 CPA firm level Yes

53

Note 2: Continuing education of directors

Job title Name Date Course name Organizer Hours
Independent
Director		 Wang-
Ying Yu		 2021.09.01 The 13th Corporate Governance Forum Financial Supervisory
Commission		 3
Independent
Director		 Che-Fu
Kung		 2021.09.01 The 13th Corporate Governance Forum Financial Supervisory
Commission		 3
Independent
Director		 Chung-
Lieh Kuo		 2021.09.01 The 13th Corporate Governance Forum Financial Supervisory
Commission		 3
Director Po-Wen
Wang		 2021.09.01 The 13th Corporate Governance Forum Financial Supervisory
Commission		 3
Independent
Director		 Che-Fu
Kung		 2021.10.20 2021 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Independent
Director		 Chung-
Lieh Kuo		 2021.10.20 2021 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Director Po-Wen
Wang		 2021.10.20 2021 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Independent
Director		 Wang-
Ying Yu		 2021.10.22 2021 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Independent
Director		 Chung-
Lieh Kuo		 2021.11.03 2021 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Independent
Director		 Chung-
Lieh Kuo		 2021.12.07 2021 Cathay Sustainable Finance & Climate Change
Summit		 Taiwan Stock Exchange 3
Director Po-Wen
Wang		 2022.05.04 Twin-Summit Forum Taiwan Stock Exchange 2
Independent
Director		 Wang-
Ying Yu		 2022.05.04 Twin-Summit Forum Taiwan Stock Exchange 2
Independent
Director		 Che-Fu
Kung		 2022.05.04 Twin-Summit Forum Taiwan Stock Exchange 2
Independent
Director		 Chung-
Lieh Kuo		 2022.05.12 Twin-Summit Forum Taiwan Stock Exchange 2
Director Po-Wen
Wang		 2022.05.20 2022 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Independent
Director		 Wang-
Ying Yu		 2022.06.10 2022 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Independent
Director		 Che-Fu
Kung		 2022.06.10 2022 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Independent
Director		 Chung-
Lieh Kuo		 2022.06.10 2022 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Director Po-Wen
Wang		 2022.07.07 Industrial Theme Briefing on the Roadmap for
Sustainable Development		 Taiwan Stock Exchange 2
Independent
Director		 Wang-
Ying Yu		 2022.07.13 Industrial Theme Briefing on the Roadmap for
Sustainable Development		 Taiwan Stock Exchange 2
Independent
Director		 Che-Fu
Kung		 2022.07.20 Industrial Theme Briefing on the Roadmap for
Sustainable Development		 Taiwan Stock Exchange 2
Independent
Director		 Chung-
Lieh Kuo		 2022.07.20 Industrial Theme Briefing on the Roadmap for
Sustainable Development		 Taiwan Stock Exchange 2
Director Chih-
Chun Liu		 2022.10.12 2022 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Independent
Director		 Che-Fu
Kung		 2022.10.12 2022 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Independent
Director		 Chung-
Lieh Kuo		 2022.10.12 2022 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Director Po-Wen
Wang		 2022.10.19 2022 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3

54

  • (IV) Composition, duties and operations of the Remuneration Committee of the Company:

  • Information on the members of the Remuneration Committee

Criteria
Position Name		 Criteria
Position Name		 Professional qualifications and
experience		 Status of independence Number of
other public
companies in
which the
individual is
concurrently
serving as a
remuneration
committee
member
Independent
Director
(Convener)		 Wang-
Ying Yu		 Please refer to page 14 of the Annual Report for the “Disclosure of professional qualifications of directors
and independence of independent directors”		 0
Independent
Director		 Che-Fu
Kung		 0
Independent
Director		 Chung-
Lieh Kuo		 0

  1. Information on the operations of the Remuneration Committee

  2. (1) The Remuneration Committee of the Company has 3 members.

2. Information on the operations of the Remuneration Committee
(1) The Remuneration Committee of the Company has 3 members.		 2. Information on the operations of the Remuneration Committee
(1) The Remuneration Committee of the Company has 3 members.		 2. Information on the operations of the Remuneration Committee
(1) The Remuneration Committee of the Company has 3 members.		 2. Information on the operations of the Remuneration Committee
(1) The Remuneration Committee of the Company has 3 members.		 2. Information on the operations of the Remuneration Committee
(1) The Remuneration Committee of the Company has 3 members.		 2. Information on the operations of the Remuneration Committee
(1) The Remuneration Committee of the Company has 3 members.
(2) The term of office of the current committee members is from July 29, 2021 to July 28, 2024. The
Remuneration Committee met two times in 2022, and the attendance of the members was as follows:
Job title Name Number of
attendance in
person		 Number of
attendance
by proxy		 Percentage of
attendance in
person (%)		 Remark
Convener Wang-Ying Yu 2 0 100% None
Committee member Che-Fu Kung 2 0 100% None
Committee member Chung-Lieh Kuo 2 0 100% None
  • (3) The matters for discussions and resolutions of the Remuneration Committee and the Company's handling of the opinions of the members:
Remuneration
Committee		 Motion content Resolution The Company's handling of
the opinions of the members
of the Remuneration
Committee
3rd meeting of the
5th Committee
2022.03.18		 1. Review of the payment of year-end
bonus to managerial officers for
2021.
2. Review of the remuneration and
performance evaluation of
directors and managerial officers
for 2021.
3. Review of the employee profit-
sharing remuneration for directors
and managerial officers for 2021.		 All members present
agreed to approve the
motions as proposed
with no objection		 Submitted to the Board of
Directors for resolution and
approved by all directors
present
4th meeting of the
5th Committee
2022.11.10		 1. Review of the remuneration and
performance evaluation of
directors and managerial officers
for 2022.
2. Discussion about the remuneration
policy, system, standard and
structure for directors and
managerial officers.
3. Review of the payment of year-end
bonus to managerial officers for
2022.		 All members present
agreed to approve the
motions as proposed
with no objection		 Submitted to the Board of
Directors for resolution and
approved by all directors
present

55

4. Discussion about the work plan of
the Remuneration Committee for
2023.
5rd meeting of the
5th Committee
2023.03.17		 1. Review of the payment of year-end
bonus to managerial officers for
2022.
2. Review of the remuneration and
performance evaluation of
directors and managerial officers
for 2022.
3. Review of the employee profit-
sharing remuneration for directors
and managerial officers for 2022.		 All members present
agreed to approve the
motions as proposed
with no objection		 Submitted to the Board of
Directors for resolution and
approved by all directors
present

  • (4) Other matters required to be recorded:

  • A.The tasks and responsibilities of the Remuneration Committee:

    • a. Regularly review the Committee Charter and propose amendments.

    • b. Establish and periodically review the policies, systems, standards and structures for annual and long-term performance goals and remuneration for directors and managerial officers of the Company.

    • c. Regularly evaluate the achievement of the performance goals of the Company's directors and managerial officers and determine the content and amount of their individual remuneration.

  • B.If the Board of Directors does not adopt or amend the recommendations of the Remuneration Committee, it should state the date, period, proposal content, resolution of the board, and its handling of the committee’s opinions: None.

  • C.If any of the members of the Remuneration Committee hold adverse opinion or qualified opinions with record or in written declaration against the resolutions of the committee, specify the date and the session of the committee meeting, the content of the motion, the opinions of all members and the response to the opinions of the members: None.

56

  • (V) Implementation status of the promotion of sustainable development, the differences from the Sustainable Development Best Practice Principles for TWSE/TPEx listed Companies and the reasons therefor:
and the reasons therefor:
Promotional Implementation Item Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
I. Does the company have established a governance structure to
promote sustainable development and set up a dedicated
department to promote sustainable development, which is
authorized and supervised by the board of directors?


V		 1. In 2022, the Board of Directors of the Company approved the renaming
of the former Corporate Governance and CSR Promotion Group to the
Sustainable Development Promotion Group, with the President as the
convener and the Vice Convener coordinating the three subgroups,
including Corporate Governance, Environmental Sustainability and
Social Co-prosperity, responsible for the formulation of policies, systems
or management policies related to sustainable development and the
formulation of specific promotion plans, implementation and review of
the effectiveness of implementation and regularly reports the
implementation plans and results to the Board of Directors at least once a
year. The main tasks are divided among the following three groups from
the relevant departments to promote the implementation:
(1) Corporate Governance Subgroup:
Responsible for compliance with laws and regulations, Board of
Directors' governance practices, implementation of internal control
system, information security, information disclosure, risk management,
shareholders' rights and interests, and other related work.
(2) Environmental Sustainability Subgroup:
Responsible for environmental protection, green environment, energy
saving and carbon reduction, ecological sustainability, greenhouse gas
inventory, and safety and health related work.
(3) Social Co-prosperity Subgroup:
Responsible for employee care, customer relations, supplier
management, workplace safety, education and training, integrity
management, human rights protection, and social benefit.
2. The implementation results for 2022 and the plan for 2023 were reported
to the Board of Directors on December 15, 2022.
3. Based on the report on the implementation status, the Board of Directors
reviews the promotionofstrategies and plans and urges the promotion




















None

57

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
team to make adjustments when necessary.
II. Does the Company conduct risk assessments on environmental,
social, and corporate governance issues related to its operations
in accordance with the materiality principle, and implement
relevant risk management policies or strategies?


V		 1. To strengthen corporate governance and improve risk management
operations, the Company has established the “Risk Management Policy”,
which was approved by the Board of Directors on November 10, 2020,
to effectuate a check and balance mechanism of the risk management.
The Company's risk management policy is mainly oriented to risk
management. The Company defines various types of risks in accordance
with the Company's overall operating policies and establishes a risk
management mechanism for early assessment and measurement,
effective supervision and strict control, with the aim of controlling risks
within acceptable or controlled limits, and strengthening the awareness
of risk control among all employees in order to reasonably ensure the
achievement of the Company's strategic objectives.
2. The scope of the Company's risk management includes market risk,
operational risk, strategic risk, financial risk, legal risk, information
security risk, and other risks that may cause the Company to incur
material losses. The risk management is carried out by each risk
working subgroup according to the issues they are responsible for .
3. The Board of Directors of the Company is the highest unit of risk
management and shall approve the risk management policy and structure,
and is responsible for approving, reviewing, and monitoring the
Company's risk management policy to ensure the effectiveness of risk
management. The Risk Management Group is directly under the
President and is responsible for the monitoring, measurement and
evaluation of the company's risk at the execution level. The risk
management of each operation is assigned to each relevant unit according
to the nature of its business.
4. The Company's Sustainable Development Promotion Group conducts risk
assessments on environmental, social and corporate governance issues
related to the Company's operations in accordance with the materiality
principle for the Sustainable Development Policy, and establishes
relevant risk managementpolicies as follows:


























None

58

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
Material
issues		 Risk assessment
Item		 Risk management policy or strategy
Environment Environmental
protection		 A.In response to the potential risks of climate
change,
the
Company
has
established
“Environmental Management Regulations” in
accordance with the characteristics of the
industry to implement the energy conservation
policy, and the Company's environmental
policy is to "comply with environmental
regulations, conserve global resources, and
fulfill social responsibility.
B.The Company has completed the establishment
of the responsible unit and its scope of duties
in accordance with the greenhouse gas
inventory and verification schedule planning,
and
will
gradually
conduct
"corporate
greenhouse
practices
and
improvement
practices" and other human resources training
courses in 2022, and at the same time, has
formulated the ISO 14064 pre-implementation
target planning.
Society 1. Product safety The Company's products comply with the
government regulations and laws, without any
hazardous materials, and to ensure the quality of
customer
service
and
enhance
customer
satisfaction, we have a dedicated unit to provide
diversified services to customers.
2. Occupational
safety		 The Company has established "Environmental
Management Regulations", "Code of Practice for
Occupational Safety and Health" and "Safety
Inspection Regulations" to enforce safety and
health protection measures, and holds regular fire
drills and exercises every year.
Corporate
governance		 Socio-economic
and legal
compliance		 The Company has established a governance
organization and implemented internal control
mechanisms to ensure that all employees and
operations comply with relevant laws and
regulations.
III. Environmental issues
(I) Does the Company establishproperenvironmental
V		 (I)The Companyhas established anenvironmental management None

59

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
management systems based on the characteristics of their
industries?		 system in accordance with the characteristics of the industry:
1. The Company's environmental policy objective is to "comply
with environmental regulations, conserve global resources and
fulfill social responsibilities".
2. The Company actively promotes various management measures
such as energy saving and carbon reduction, waste reduction,
etc., and collects information on relevant environmental laws
and regulations in a timely manner to ensure that the Company's
business activities comply with the requirements of laws and
regulations.





(II) Does the Company endeavor to utilize all resources more
efficiently and use renewable materials which have low
impact on the environment?

V		 (II) 1. In response to climate change mitigation and adaptation and
sustainable resource use issues, net-zero carbon emission has
become a global trend. The Company responds to the
government's policy of "low-carbon sustainable homes",
implements energy saving and carbon reduction and promotes
resource use, and strives to develop related products to reduce
office greenhouse gas emissions in order to enhance carbon
reduction benefits and reduce the impact on the environment.
We also implement electronic documents, reuse recycled paper,
avoid unnecessary waste of resources, and prioritize the use of
green and energy-saving products.
2. The Company aims to reduce electricity consumption by 1% per
year.The electricity consumption in 2022 was reduced by about
2% compared with 2021.











None
(III) Does the Company assess the potential risks and
opportunities of climate change for its current and future
operations and undertake response measures with respect
to climate change?


V		 (III) Climate change has become an important issue for investors and
companies alike. The Company conducts risk assessments and
develops countermeasures for climate change and reports them to
the Board of Directors on a regular basis. The Company understands
that by saving energy and reducing carbon, it can achieve the
reduction of greenhouse gases, thus reducing the occurrence of
environmental impact climate change, and the implementation
measuresinclude:






None

60

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
1. We
use
our
self-developed
"Building
Power
Saving
Management System" to develop a power saving service
platform with intelligent management mechanism to provide
optimal power usage in buildings to help manage building power
consumption.
2. The use of LED lights in the office area will result in significant
electricity savings. The Company will continue to improve
electricity consumption and aim to save 1% of electricity per
year.
3. Public area lighting is managed on a regular basis by sensors.
4. The priority of purchasing equipment is environmental
protection and energy saving.
5. The air conditioning is managed on a regular basis and the
temperature is limited (set at 26 degrees Celsius or less) to
reduce electricity consumption and avoid gas emissions.
6. We implement electronic document use, use old envelopes as
briefcases for internal document delivery, recycle waste toner
cartridges and waste paper, and recycle and reuse paper.
7. The office area is inspected from time to time.
8. The environmental committee and the office bearers on the floor
are responsible for energy saving and safety control (including
access control, emergency handling, and crisis management that
may cause interruption of the company's operation) on the floor.
9. We strive to develop energy-saving products to reduce the
impact on the environment.
10.We implement waste management policies and water
conservation measures.
















(IV) Does the Company calculate the amount of greenhouse gas
emission, water consumption, and waste production in the
past two years and implement policies to cut down energy
and water consumptions, carbon and greenhouse gas
emissions,and wasteproduction?



V		 (IV) The Company's energy saving and carbon reduction benefits and
policy for the past two years based on statistics are as follows (the
following information is from the Taipei Head Office):
1. The office carbon emissions in 2022 and 2021 were 1,107 and
1,132 metric tons,respectively,representinga 2% reduction



None

61

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
from 2021 to 2022. In 2023, we will continue to reduce
unnecessary electricity consumption and implement various
energy-saving measures, with a target of 1% carbon reduction in
2023. The Company is an information service provider
providing professional services and has no production processes,
therefore, there are no sources of process emissions (Scope I).
2. In response to the low-carbon policy and greenhouse gas
reduction, the Company's main measures include research and
development of relevant energy-saving products, procurement
of environmentally friendly energy-saving equipment, and
promotion of colleagues to reduce non-essential use of
electricity and cultivate low-carbon living habits.
3. In the course of the Company's operation, no additional
wastewater will be generated except for general water for
people's domestic use. Wastewater is discharged in accordance
with the regulations and there is no concern about water
pollution. The total water consumption in 2022 and 2021 were
10,000 tons and 9,025 tons respectively, up approximately 10%
in 2022 compared to 2021. The increase in water consumption
in 2022 was mainly due to the need to strengthen our own and
environmental cleanliness in response to pandemic prevention.
With the pandemic slowing down in 2023, the Company will
continue to conserve water in daily life with the goal of saving
1% of water consumption.
4. The Company is a non-manufacturing company and does not
generate hazardous wastes:
The Company's general recycling materials are centrally placed
in the recycling area and are classified according to paper, glass,
plastic, iron and aluminum, and PET bottles, etc. Non-recyclable
waste such as polystyrene, wood pallets, foam, and bubble bags,
which are required to be separated from general waste disposal
according to government requirements, are collected and
transported to differentrecycling sites by professionaland


























62

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
qualified waste disposal companies. The domestic garbage is
collected and transported to the incineration plant.
The total weight of the Company's general recyclables was 8
metric tons in both 2022 and 2021, and the total amount of non-
recyclable waste and domestic garbage was 25.37 metric tons
and 24.16 metric tons in 2022 and 2021. The increase of 5% in
2022 compared to 2021 was mainly due to the increase of
packaging materials for large projects, and the fact that most of
the employees do not dine out due to the pandemic and bring out
lunch boxes for drinks, and that large meetings or trainings are
also arranged within the company due to the pandemic, resulting
in a large number of lunch boxes and therefore an increase in the
amount of garbage. The Company will continue to reduce waste
through various waste reduction programs to protect the earth
and cherish resources, to reduce waste generation, and to
implement waste management to reduce the damage to the earth,
withthe annualtarget of reducing waste generationby1%.












IV. Social Issues
(I) Does the Company formulate appropriate management
policies and procedures according to relevant regulations
and the International Bill of Human Rights?

V		 (I)
In order to fulfill corporate social responsibility and implement
human rights protection, the Company has formulated human rights
policies with reference to internationally recognized human rights
standards, such as the International Bill of Human Rights and the
International Labor Organization, and has disclosed the relevant
contents on the Company's website, The main policies and
management plans are as follows:
1.Support international human rights conventions:
(1)The Company supports the principles of the United Nations
“Global Compact”, respects international human rights, and
ensures that the Company does not violate human rights
internally and does not share in the violation of human rights.
(2)The Company supports the “goals of the United Nations
Universal Declaration of Human Rights” and the “International










None

63

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
Labor Organization Convention”, which prohibit any form of
discrimination, forced labor and child labor, and impediment to
the freedom of association of employees.
(3)The Company is committed to providing a safe and healthy
working environment for its employees, to continuously
improve the safety and health of the working environment in
compliance with relevant laws and regulations, to prevent
accidents, to reduce the risk of occupational accidents, and to
protect the safety and promote the physical and mental health of
its employees.
2.Respect human rights in the workplace:
(1)The Company complies with the Labor Standards Act, the
Gender Equality Act, and other relevant laws and regulations.
(2)The Company effectuates diversity in the workplace and will not
discriminate on the basis of gender, sexual orientation, race,
class, age, marriage, language, ideology, religion, party
affiliation, national origin, place of birth, appearance, facial
features, physical or mental disabilities, and will work together
to create a dignified, safe, equal, and harassment-free work
environment.
3.Enforce information security:
In order to protect human rights and privacy, the Company has
established a comprehensive information security management
mechanism and follows strict control regulations and protective
measures.
In 2022, the Company organized promotional educations on
ethical corporate management policies, the "Personal Information
Management System (PIMS)", "Information Security", "Human
Rights Protection" and internal control courses for 4,465
attendees, totaling 5,772person-hours.




















(II) Does the Company establish and deliver reasonable
employee
welfare
programs
(including
salary,
V		 (II) 1. Implement reasonable employee welfare measures:
(1)TheCompanyhas established the EmployeeWelfareCommittee,		 None

64

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
compensated absences, and other benefits) and adjust
employee
compensation
in
relation
to
business
performance?
which is responsible for the welfare of all employees, and the
welfare measures are supervised and executed by the Welfare
Committee every year.
(2)The Company's welfare measures mainly include labor, health,
group insurance, employee travel, birthday gifts, beer parties,
year-end parties, welfare products, wedding and funeral subsidies,
child birth subsidies, club activity subsidies, and health checkups.
These measures are effective in boosting employees' morale.
(3)Various club activities are organized to provide employees with a
balance between work and leisure.
(4)The Company provides group insurance for employees, their
spouses and children. The coverage includes term life insurance,
accidental injury insurance, hospitalization medical insurance, and
cancer insurance.
2. The Company enforces diversity and equality in the workplace and
provides equal promotion opportunities for male and female
employees. In 2022, the percentage of female employees was 31%
and the percentage of female managerial officers was 22%.
3. Reflect business performance or results in employee compensation
as appropriate:
(1)The Company has established reasonable salary and remuneration
measures, a complete performance management system, and a
clear and effective reward and disciplinary system.
(2)In accordance with the provisions of Article 21 of the Company's
Articles of Incorporation: If the Company makes a profit in a fiscal
year, it shall allocate no less than 3% of the balance as employee
remuneration, which shall be distributed in stock or cash as per the
resolution by the Board of Directors. The recipients shall include
employees of the controlling company or subsidiaries who met
certain criteria. The distribution of employee remuneration shall
be reported to the shareholders’ meeting. However, when the
Company still has a cumulative deficit, it shall reserve an amount
to compensateitfirst and thenallocate anamountforemployee























65

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
remuneration according to the percentage set out in the preceding
paragraph.
(III) Does the Company provide a healthy and safe work
environment and organize training on health and safety
for its employees on a regular basis?

V		 (III) The Company believes that employees who are physically and mentally
healthy can create efficient and high quality work performance, and
therefore is committed to providing a safe and healthy work
environment for employees, including:
1. The Company has established "Environmental Management
Regulations", and, in accordance with occupational safety and
health related regulations, has formulated the "Code of Practice for
Occupational Safety and Health" and "Safety Inspection
Regulations" to enforce safety and health protection measures.
2. In order to protect and maintain the safety of the office area, the
Company has set up a facial recognition access control system. All
employees are required to wear identification cards when entering
and leaving the building, and a surveillance system is in place to
monitor and record 24 hours a day. Visitors are not allowed to enter
the office area and must be received in the reception area. The main
entrances and exits are guarded by security guards 24 hours a day to
protect the personal safety of our employees.
3. Employees will be briefed on the safety regulations by person in
charge of each unit at the time of reporting for work.
4. In order to effectuate the prevention and control of tobacco hazards,
maintain the hygiene of the office environment and purify the air
quality, and reject the health hazards caused by second-hand smoke.
The Company's offices (areas), meeting rooms, stairwells,
restrooms, dormitories and other indoor areas are all smoke-free
except for the open balcony space and the legal smoking area.
5. The office area is nice and in good condition, and an environmental
officer is assigned to each office area and each floor to supervise the
environmental cleanliness of the area.
6. A complete fire safety system, including alarms, fire extinguishers,
emergencylights,escape lights,escape doors,etc.,is inplace,and























None

66

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
all equipment is inspected and replaced at least once a year.
7. We cooperate with the fire department twice a year to conduct fire
drills and escape route drills in the building.
8. We conduct office carbon dioxide concentration monitoring and
drinking water testing of water dispensers every six months.
9. In response to the recent COVID-19 pandemic, in addition to
strengthening the promotion of public health and cleaning and
disinfection, employees and visitors are required to wear masks,
take body temperature and disinfect their hands every day when they
come to the company, and alcohol is placed at the entrance of each
floor, antibacterial hand sanitizer is placed in the pantry, and
alcohol/antibacterial hand sanitizer is placed in each meeting room
for employees or visitors to use.
10.A medical doctor is appointed to visit the company every two
months to provide clinical services and professional nurses are
employed to provide health services for workers, and we
immediately share occupational safety and health related
information in the "Occupational Safety and Health" page, which
includes "Occupational Safety Bulletin" and "Registered Nurse
Bulletin" .
11.By organizing various club activities, employees can not only
enhance their physical fitness and relieve physical fatigue, but also
achieve a balance between work and leisure.
12.Through regular annual employee health checkups and a variety of
health seminars and health education information, employees can
better grasp their health status and have the knowledge and methods
of self-health management.
13.We provide employees with term life insurance and accident
insurance to increase their job protection.
14.We provide a family-friendly workplace environment for employees
by setting up a breastfeedingroom.




















(IV) Does theCompany provide its employees with career
V		 (IV)In order to cultivate talented employees,theCompanyhas established None

67

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
development and training sessions? an effective career development training program for employees and
provides various internal or external education and training courses
from time to time. The total number of internal training and external
training was 7,036 and the cost of education and training was NT$6.01
million in 2022.


(V) Does the Company comply with relevant regulations and
international standards regarding customer health and safety,
right to privacy, marketing and labeling of its products and
services and set up relevant consumer or client protection
policies and complaint procedures?



V		 (V) The Company complies with relevant laws and regulations and
international standards for its products and services to protect the
rights and interests of its customers. The Company reinforces the
concept of rule of law for the protection of customers' confidential
information on its employees and suppliers at all times, and has set up
a dedicated e-mail address to handle issues related to customer
complaints.		 None
(VI) Does the Company formulate supplier management policies
that require suppliers to comply with relevant regulations on
environmental protection, occupational safety and health, and
labor rights and request their reporting on the implementation
of such issues?



V		 (VI) The Company has established supplier management policies, which are
mainly as follows:
1.Suppliers must meet its requirements in environmental protection,
safety and health. Before engaging with any suppliers, the Company
should evaluate whether they have records of environmental and
social impacts, in addition to assessing quality, technology, finance,
price, delivery time and service to meet the Company's
requirements, and avoid trading with those that are in conflict with
the corporate social responsibility policy.
2.Suppliers shall sign the "Supplier Commitment" in accordance with
the Company's regulations, strictly abide by ethical corporate
management,
sustainable
environmental
development
and
protection of basic human rights, and jointly comply with CSR-
related regulations.
3.The Company's supplier appraisal program has included corporate
social responsibility (CSR) sustainability assessment to promote the
cooperation of suppliers to jointly comply with CSR-related norms,
give full play to corporate social influence, and promote the
balanced and sustainable development of the economy, society and
the environment and ecology.














None

68

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
4.Once a cooperative relationship is established between the Company
and its suppliers, both parties shall maintain a stable cooperative
relationship in a mutually trustworthy manner. material projects
shall stipulate the rights and obligations of both parties by contract,
and require suppliers to comply with CSR policy-related laws and
regulations including environmental protection, safety, health
issues, etc., and shall abide by relevant codes of conduct of integrity.
If necessary, suppliers shall be required to provide a declaration or
relevant certification. The Company may terminate or cancel the
contract at any time if any supplier is involved in a violation of the
CSR policy or has a significant impact on the environment and
society.
5.The Company mainly distributes and represents products from
international brands. In addition to ensuring that the Company's
products comply with international standards and regulations such
as the European Union, the Company will include in the evaluation
of suppliers whether they provide relevant certifications, including
ISO 9001 quality management system certification, ISO 27001
information
security
management
system,
ISO
14001
environmental certification, occupational safety and health
management
system
certification,
and
energy
efficiency
certification.
6.The Company cooperates with suppliers to fulfill corporate social
responsibility.
7.The Company conducts annual supplier evaluations. Please refer to
the Company's website: Supplier Management for information on
suppliersustainabilitymanagementmeasures andimplementation.


















V.
Did the company, following internationally recognized
standards or guidelines, prepare and publish reports such as
its Corporate Sustainable Development report to disclose
non- financial information of the company? Has the
company received assurance or certification of the aforesaid



V The Company has disclosed relevant and reliable information on the
Company's website, the Market Observation Post System and Annual
Report.

The Company has not yet
compiled Corporate Sustainable
Development report, and will
prepare Corporate Sustainable
Development report with
reference to internationally

69

Promotional Implementation Item Implementation Status Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
reports from a third party accreditation institution? recognized standards or
guidelines.
VI. If the Company has established the corporate social responsibility best practice principles based on the " Sustainable Development Best Practice Principles for TWSE/TPEx Listed
Companies", please describe any discrepancy betweenthePrinciples and their implementation: None disparity.
VII. Other important information to facilitate better understanding of the company's Corporate Sustainable Development practices:
In 2022, the Board of Directors of the Company approved the renaming of the former Corporate Governance and CSR Promotion Group to the Sustainable Development Promotion
Group, with the President as the convener and the Vice Convener coordinating the three subgroups, including Corporate Governance, Environmental Sustainability and Social Co-
prosperity, responsible for the formulation of policies, systems or management policies related to sustainable development and the formulation of specific promotion plans,
implementation and review of the effectiveness of implementation and regularly reports the implementation plans and results to the Board of Directors at least once a year. The main
tasks are divided among the following three groups from the relevant departments to promote the implementation:
(I) Corporate Governance Subgroup:
Responsible for compliance with laws and regulations, Board of Directors' governance practices, implementation of internal control system, information security, information
disclosure, risk management, shareholders' rights and interests, and other related work.
(II) Environmental Sustainability Subgroup:
Responsible for environmental protection, green environment, energy saving and carbon reduction, ecological sustainability, greenhouse gas inventory, and safety and health
related work.
(III) Social Co-prosperity Subgroup:
Responsible for employee care, customer relations, supplier management, workplace safety, education and training, integrity management, human rights protection, and social
benefit.
The implementation results for 2022 and the plan for 2023 were reported to the Board of Directors on December 15, 2022.
The main implementation results for 2022 are as follows:
1. The issue of energy saving and carbon reduction has been the focus of international attention for years, and the technology-based service of energy saving has become an
important development direction in the coming years. In response to this trend, we have developed a "Building Power Saving Management System" for domestic
commercial/factory/residential buildings to establish a power saving service platform with an intelligent management mechanism to provide optimal power usage in
buildings and assist owners in managing building power consumption to achieve the goal of doing our part for the earth.
2. In order to nurture outstanding talents and increase the opportunities for industry-academia cooperation between enterprises and academia, the Company actively participates
in sponsoring scholarships and various activities of academic organizations. In 2022, the Company donated NT$40,000 each to the “NCKUEE Cultural and Educational
Foundation” and “National Dong Hwa University” and NT$50,000 for scholarships to “Tamkang University”, and employed 9 interns, including 1 from the Department of
Information Science of National Taipei University of Education, 1 from the Department of Information Engineering of Cultural University, 5 from the Department of
Information Management of Yuan Ze University, and 1 from the Department of Information Science of Takming University of Science and Technology with professional
internship opportunities.

70

  1. In order to develop talented people, we offer various education and training courses from time to time, and the implementation of education and training in 2022 was as follows:

  2. (1) New employees: To enable new employees to understand the company's culture and rules and regulations as well as labor safety and health knowledge, we regularly hold two "New Employee Education and Training" courses every month, including "Basic Training Course" and "Safety and Health Education Training Course".

  3. (2) Internal training: Various functional training courses are offered from time to time.

    • A. Sales staff: In addition to the courses on related agency products, eight SYSCOM product certification courses are held from time to time, and one major business training is held every quarter.

Note: Each salesperson is required to pass at least 2 product certifications each year.

  • B. Technical staff: In addition to the technical courses offered from time to time, there are 13 SYSCOM technical certification courses.

  • Note: Technical staff who write programs must hold three valid certifications, and technical staff who do not write programs must hold two valid certifications.

  • C. Leadership training: Senior/middle-level/jonior leader training, in-person and digital teaching methods, 10 courses.

  • (3) In addition to internal functional training courses, employees may also apply for external training (including professional technical certification examinations) according to their needs.

  • (4) In 2022, the Company had 7,036 attendance in internal training and external training, and the cost of education and training was approximately NT$6.01 million.

  • The main plans for 2023 are as follows:

  • In terms of corporate governance, we plan to continue to implement the Board of Directors' performance evaluation and improve the transparency of information on our website from 2023 onwards.

  • Continue to provide training courses for leaders, sales and technical staff.

  • Continuously participate in industry-academic cooperation, sponsorship of scholarships and application for research and development alternative military services.

  • Conduct awareness training courses on Ethical Corporate Management Best Practice Principles, Code of Ethical Conduct, and Trade Secrets for employees.

  • Continue to promote energy conservation policies and conduct occasional environmental inspections in accordance with the “Environmental Management Regulations” and “Safety Inspection Regulations”.

  • Encourage suppliers to obtain labels or certifications related to environmental protection, quality, and occupational safety and health, and continue to evaluate and manage suppliers

71

  • (VI) Implementation status of ethical corporate management and the differences from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and the reasons therefor:
and the reasons therefor:
Evaluation Item Implementation Status Deviations from "the Ethical
Corporate Management Best
Practice Principles for
TWSE/TPEx Listed
Companies"andReasons
Yes No Description
I. Establishment of Corporate Conduct and Ethics Policy and
Implementation Measures
(I)
Does the company have a clear ethical corporate
management policy approved by its Board of Directors, and
bylaws and publicly available documents addressing its
corporate conduct and ethics policy and measures, and
commitment regarding implementation of such policy from
the Board of Directors and the top management team?
(II) Whether the company has established an assessment
mechanism for the risk of unethical conduct; regularly
analyzes and evaluates within a business context, the
business activities with a higher risk of unethical conduct;
has formulated a program to prevent unethical conduct with
a scope no less than the activities prescribed in paragraph 2,
Article 7 of the Ethical Corporate Management Best Practice
Principles for TWSE/TPEx Listed Companies?












V
V		 (I) The Company has established the "Ethical Corporate
Management Best Practice Principles", the "Procedures for
Ethical Management and Guidelines for Conduct" and "Code
of Ethical Conduct" as approved by the Board of Directors in
accordance with the Ethical Corporate Management Best
Practice Principles for TWSE/TPEx-listed Companies, to
express the policies and practices of ethical corporate
management, and the commitment of the Board of Directors
and senior management to actively enforcing the ethical
corporate management policy.
(II) 1. The Company conducts its business in compliance with the
Company Act, the Securities and Exchange Act, the
Business Entity Accounting Act, the Political Donations
Act, the Anti-Corruption Act, the Government Procurement
Act, the Act on Recusal of Public Servants Due to Conflicts
of Interest, the regulations for listed companies, or other
laws and regulations related to business practices.
2. The Company has established the "Ethical Corporate
Management Best Practice Principles", which covers all the
prevention measures under Paragraph 2, Article 7 of the
“Ethical Corporate Management Best Practice Principles for
TWSE/TPEx Listed Companies”.
3. The Company has specified the matters that the Company's
personnel should pay attention to when performing business
in the “Procedures for Ethical Management and Guidelines
for Conduct”. The Company prohibits the provision or
receipt of improper benefits and regulates the measures for
handling related activities with a higher risk of unethical
conduct within the scope of business. The Company may
terminate orcancelthe contracts ofsuppliers, contractors or


























None

72

Evaluation Item Implementation Status Implementation Status Implementation Status Deviations from "the Ethical
Corporate Management Best
Practice Principles for
TWSE/TPEx Listed
Companies"andReasons
Yes No Description
(III) Whether the company has established relevant policies that
are duly enforced to prevent unethical conduct, provided
implementation procedures, guidelines, consequences of
violation and complaint procedures, and periodically reviews
and revises such policies?



V		 other partners at any time in the event of unethical conduct,
except for the contractual requirement that the suppliers,
contractors or other partners shall not engage in any illegal
business practices and shall not provide improper benefits
or bribes to employees.
(III) 1. The Company's “Work Rules for Employees” also provides
penalties for dishonest behavior.
2. The Company has established the “Procedures for Ethical
Management and Guidelines for Conduct”, the “Code of
Ethical Conduct”, and the “Code of Conduct for Anti-
Corruption and Business Ethics and Activities”, which
specify the measures to be observed in performing business
and prohibit the provision or acceptance of improper
benefits. In the course of conducting business, the
Company's personnel shall comply with the Company's
ethical corporate management policies and related
regulations and expressly refuse to offer, promise, request
or accept, directly or indirectly, any improper benefits in
any form or name, including kickbacks, commissions or
other means of offering or accepting improper benefits. In
order to ensure that all employees of the Company comply
with the relevant regulations, the Company has established
a "Whistleblower Reporting Regulations" to prevent
personnel from violating the regulations.
3. In addition to holding regular annual orientations, the
Company also regularly reviews and amends relevant
systems and operating procedures.




















II. Ethic Management Practice
(I) Whether the company has assessed the ethics records of whom
it has business relationship with and include business conduct
and ethics related clauses in the business contracts?
(II) Whether the company has set up a unit which is dedicated to
promoting the company’s ethical standards and regularly (at
least once a year)reports directly to theBoard of Directors on




V
V		 (I) The Company evaluates the ethical management records of its
counterparties of transactions and specifies the terms of ethical
behavior in the contracts signed with them.
(II) The Company has designated the Administration and Planning
Division as the responsible unit for the promotion of ethical
corporatemanagement andisresponsiblefortheformulation




None

73

Evaluation Item Implementation Status Implementation Status Implementation Status Deviations from "the Ethical
Corporate Management Best
Practice Principles for
TWSE/TPEx Listed
Companies"andReasons
Yes No Description
its ethical corporate management policy and relevant matters,
and program to prevent unethical conduct and monitor its
implementation?
and supervision of the implementation of ethical corporate
management policies and prevention programs, reporting the
performance to the Board of Directors at least once a year and
disclosing the related contents on the Company's website. The
implementation status of the Company’s ethical corporate
management policy:
1.The Company has established the “Ethical Corporate
Management Best Practice Principles”, the “Procedures for
Ethical Management and Guidelines for Conduct”, and the
“Code of Ethical Conduct” in accordance with the Ethical
Corporate Management Best Practice Principles for
TWSE/TPEx-listed Companies, to actively enforce ethical
corporate management policy, to let employees clearly
understand ethical corporate management concepts and
standards, to hold regular dialogues and occasional education
and training related to ethical corporate management, to
promote the principles of ethical corporate management and
require its enforcement.
2.The “Work Rules for Employees” specify penalties for
unethical behavior, and the Company has established the
"Code of Conduct for Anti-Corruption and Business Ethics
and Activities" to require all employees to comply with the
relevant anti-corruption law. No unethical acts occurred
in 2022 .
3.The Company has established procedures for handling
complaints
and
confidentiality
in
the
“SYSCOM
COMPUTER Whistleblower Reporting Regulations”, and
no complaints were filed in 2022.
4.In 2022, we held training courses related to ethical corporate
management issues, such as "Partner Training on Business
Ethics and Anti-corruption", the "Personal Information
Management System (PIMS)", "Information Security",
"Human Rights Protection" and internal control courses for
4,465 attendees, totaling 5,772person-hours.



























74

Evaluation Item Implementation Status Implementation Status Implementation Status Deviations from "the Ethical
Corporate Management Best
Practice Principles for
TWSE/TPEx Listed
Companies"andReasons
Yes No Description
(III) Whether the company has established policies to prevent
conflict of interests, provide appropriate communication and
complaint channels and implement such policies properly?
(IV) To implement relevant policies on ethical conducts, has the
company established effective accounting and internal control
systems, audit plans based on the assessment of unethical
conduct, and have its ethical conduct program audited by
internal auditors or CPA periodically?
(V) Does the company provide internal and external ethical
conduct training programs on a regular basis?






V
V
V		 5.The Administration and Planning Division reported the
implementation status in 2022 to the Board of Directors on
December 15, 2022.
(III) The Company's policies related to the prevention of conflicts
of interest are set forth in the “Procedures for Ethical
Management and Guidelines for Conduct” and the “Code of
Ethical Conduct”. In addition to reporting to the immediate
leader of their departments, employees within the Company
may also report conflicts of interest directly to the head of
the Administration Department.
(IV) In order to enforce the ethical corporate management policy,
the Company reviews all transactions and accounts in
accordance with accounting principles and conducts special
audits for special or questionable cases. The Audit Office has
included the operations of the dishonesty prevention
program in the audit plan, and will conduct audits of each
department from time to time to implement the monitoring
mechanism and control various risk management.
(V) 1.The Company has established relevant operating regulations
for employees to promote and make them clearly
understand ethical corporate management concepts and
standards.
2.The Company will hold awareness educations from time to
time to promote the principles of ethical corporate
management andrequireitsimplementation.


















III. Implementation of Complaint Procedures
(I)
Does the company establish specific complaint and reward
procedures, set up conveniently accessible complaint channels,
and designate responsible individuals to handle the complaint
received?


V		 (I) The Company has established the “Whistleblower
Reporting Regulations” in accordance with the "Ethical
Corporate Management Best Practice Principles for
TWSE/TPEx Listed Companies" to specify the procedures
for handling whistleblower complaints and the related
confidentiality mechanism. No complaints have been filed
to date, and the Administration and Planning Division is the
dedicatedhandling unit.		 None

75

Evaluation Item Implementation Status Implementation Status Implementation Status Deviations from "the Ethical
Corporate Management Best
Practice Principles for
TWSE/TPEx Listed
Companies"andReasons
Yes No Description
(II) Whether the company has established standard operation
procedures for investigating the complaints received, follow-
up measures after investigation are completed, and ensuring
such complaints are handled in a confidential manner?
(III) Does the company adopt proper measures to prevent a
complainant from retaliation for his/her filing a complaint?


V
V		 (II) The handling procedures and the related confidentiality
mechanism are specified in the Company's whistleblower
reporting regulations.
(III) The Company adopts a protection policy for whistleblowers
and does not subject them to improper treatment due to
theirwhistleblowing.
IV. Information Disclosure
Does the company disclose its guidelines on business ethics as well
as information about implementation of such guidelines on its
website andMarket Observation Post System(“MOPS”)?

V		 The Company has disclosed its Ethical Corporate Management
Best Practice Principles on the Company's website, the Market
Observation Post SystemandAnnual Report.

None
V. If the company has established corporate governance policies based on Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies, please describe any
discrepancy between the policies and their implementation: None disparity.
VI. Other important information to facilitate better understanding of the company’s corporate conduct and ethics compliance practices (e.g., review the company’s corporate conduct and
ethics policy):
In addition to the above, the Company's “Procedures for Ethical Management and Guidelines for Conduct” also govern the following:
(I)
Prohibition of offering or accepting improper benefits
(II) Declaration of the ethical corporate management policy is to the outside world
(III) Ethical corporate management policy with business partners
(IV) Contract specifying ethicalcorporatemanagement

  • (VII) For inquiries about the Corporate Governance Best Practice Principles and related regulations: Please refer to the Market Observation Post System and the Company's website for details of the Corporate Governance related regulations.

  • (VIII) Other important information to enhance understanding of the operations of the Company’s corporate governance: The Company has been continuously improving its corporate governance practices for a long time. Please refer to the information on the Company's website http://www.syscom.com.tw for related corporate governance operations.

76

  • (IX) Implementation status of internal control system:

  • Internal Control System Statement

SYSCOM COMPUTER ENGINEERING CO.(Stock Code:2453) Internal Control System Statement

Date: March 17, 2023

With regard to the 2022 internal control system, the Company declares the following based on the selfevaluation findings:

  1. The Company is fully aware that establishing, implementing, and maintaining an internal control system are the responsibility of its Board of Directors and managerial officers. The Company has established such a system to provide reasonable assurance for attaining the aims of the effectiveness and efficiency of business operations (including profits,performance, safeguarding of asset security, etc.); reliability, timeliness, transparency of reporting; and compliance with the governing laws and regulations.

  2. An internal control system has inherent limitations. No matter how perfectly designed, an effective internal control system provides assurance to the aforementioned aims only to a reasonable extent. Moreover, due to changes of environments and circumstances, the effectiveness of an internal control system may change accordingly. Nevertheless, the internal control system of the Company is equipped with a self-monitoring mechanism, and the Company takes corrective actions as soon as any fault is identified.

  3. The Company determines the design and operating effectiveness of its internal control system in accordance with the determining factors provided in the Regulations Governing the Establishment of Internal Control Systems by Public Companies (hereinafter referred to as the “Regulations”). The internal control system determining factors specified in the Regulations divide an internal control system into five elements based on its management: 1. Control Environment, 2. Risk Assessment, 3. Control Operations, 4. Information and Communications, and 5. Monitoring. Each element further contains several items. Refer to the Regulations for the aforementioned items.

  4. The Company has adopted the aforementioned internal control system determining factors to examine the design and operating effectiveness of its internal control system.

  5. Based on the findings of the evaluation mentioned in the preceding paragraph, the Company deems that the internal control system as of December 31, 2022 (including supervision and management of subsidiaries), which encompass internal controls for knowledge of the accomplishment degree of operating effectiveness and efficiency, reliability, timeliness, transparency of reporting, and compliance with the governing laws and regulations, are effectively designed and implemented, and reasonably assure accomplishment of the abovementioned aims.

  6. This Statement constitutes the main content of the Company’s annual report and prospectus, and will be made public. Any wrongful act pertaining to falsification or concealment involving the above public declaration will be subjected to legal liabilities under Articles 20, 32, 171, and 174 of, and other regulations relating to, the Securities and Exchange Act.

  7. This Statement was approved by the Board Meeting of the Company held on March 17, 2023, where none of the seven attending directors expressed dissenting opinions, and all consented to the content of this Statemen.

Syscom Computer Engineering Co.

Chairman ： Jui-Fu Liu

President ： Jui-Long Liu

77

  1. Where a CPA has been hired to carry out a special audit of the internal ontrol system, furnish the CPA audit report: None.

  2. (X) During the most recent year or during the current year up to the date of publication of the Annual Report, if the Company or its internal personnel have been punished in accordance with law, or the Company has punished its internal personnel for violating the provisions of the internal control system, and the results of such punishments may have a material effect on shareholder equity or securities price, the contents of the punishments, major deficiencies and improvements should be listed: None.

  3. (XI) Important resolutions of the shareholders' meeting and board meeting during the most recent year or during the current year up to the date of publication of the Annual Report:

1.Shareholders’meeting: 1.Shareholders’meeting: 1.Shareholders’meeting:
Date Important resolutions Implementation status
2022.06.15
Regular
shareholders’
meeting
1. Adoption of 2021 Business Report and Financial
Statements.
2. Adoption of 2021 earnings distribution proposal.
3. Approval of the amendments to the “Rules of
Procedure for Shareholders’ Meetings”.
4. Approval of the amendments to the “Articles of
Incorporation”.
5. Approval of the amendments to the “Procedures
for Acquisition and Disposal of Assets”		 1. Implemented in accordance with the resolutions of
the shareholders' meeting.
2.July 20, 2022 was set as the base date for
distribution and August 9, 2022 as the payment
date, and cash dividends of NT$1.9 per share were
distributed in accordance with the resolution of the
shareholders' meeting.
3.The
amended
“Rules
of
Procedure
for
Shareholders’ Meetings” have been followed for
the operations.
4.The amendments were registered on June 28, 2022
upon approval by the Ministry of Economic
Affairs and announced on the Company's website.
5.The amended “Procedures for Acquisition and
Disposal of Assets” have been followed for the
operations
2. Board of Directors
Date Important resolutions
1st meeting in 2022
2022.03.18		 1. 2021 Business Report.
2. Report on the results of performance evaluation of the Board of Directors for 2021.
3. Approval of 2022 business plan and budget.
4. Approval of review matters of the 3rd meeting of the 5th Remuneration Committee.
5. Approval of the 2021 profit-sharing remuneration proposal for employees and directors.
6. Approval of the renewal of directors' and managerial officers' liability insurance.
7. Approval of the financial statements and business report for 2021.
8. Approval of 2021 earnings distribution proposal.
9. Approval of the amendments to the “Articles of Incorporation”.
10. Approval of the amendments to the “Procedures for Acquisition and Disposal of Assets”.
11. Approval of the amendments to the “Rules of Procedure for Shareholders’ Meetings”.
12. Approval of the amendments to the “Corporate Governance Best Practice Principles”.
13. Approval of the amendments to the “Corporate Social Responsibility Best Practice Principles”.
14. Approval of the subjects of the 2022 regular shareholders’ meeting.
15. Approval of the acceptance of the proposals of shareholders holding more than one percent of
shares.
16. Approval of the evaluation of the independence and competency and appointment of attesting
CPAs.
17. Approval of the "Assessment of the Effectiveness of Internal Control System" and " Internal
Control System Statement" for 2021.
18. Approval of bank financing lines.
19. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.
2nd meeting in 2022
2022.05.11		 1. Report on greenhouse gas inventory and verification schedule planning.
2. Approval of the review of the financial statements for 1Q2022.
3. Approval of the amendments to the “Corporate Governance Best Practice Principles”.
4. Approval of the amendments to the “Procedures for Handling Material Inside Information and
Procedures for the Prevention of Insider Trading”.
5. Approval of bank financing lines.
6. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.
3rd meeting in 2022
2022.08.10		 1. Report on greenhouse gas inventory and verification schedule planning.
2. Approval of the review of the financial statements for 2Q2022.

78

3. Approval of the name change and organizational amendments to the "Corporate Governance
and CSR Promotion Group".
4. Approval of the renewal of office lease upon expiration.
5. Approval of bank financing lines.
6. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.
4th meeting in 2022
2022.11.10		 1. Report on greenhouse gas inventory and verification schedule planning.
2. Approval of the review of the financial statements for 3Q2022.
3. Approval of the audit plan for 2023.
4. Approval of review matters of the 4th meeting of the 5th Remuneration Committee.
5. Approval of the amendments to the “Rules of Procedure for the Board of Directors’ Meetings”.
6. Approval of the amendments to the “Procedures for Handling Material Inside Information and
Procedures for the Prevention of Insider Trading”.
7. Approval of bank financing lines.
8. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.
5th meeting in 2022
2022.12.15		 1. Report on the promotion of sustainable development.
2. Report on the operations of ethical corporate management.
3. Report on intellectual property management plan and its implementation status.
4. Report on information security policy and management.
5. Report on the operations of risk management policy and procedures.
6. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.
1st meeting in 2023
2023.03.17		 1. 2022 Business Report.
2. Report on the results of performance evaluation of the Board of Directors for 2022.
3. Report on greenhouse gas inventory and verification schedule planning.
4. Approval of 2023 business plan and budget.
5. Approval of review matters of the 5th meeting of the 5th Remuneration Committee.
6. Approval of the 2022 profit-sharing remuneration proposal for employees and directors.
7. Approval of the renewal of directors' and managerial officers' liability insurance.
8. Approval of the financial statements and business report for 2022.
9. Approval of 2022 earnings distribution proposal.
10. Approval of the amendments to the “Articles of Incorporation”.
11. Approval of the amendments to the “Corporate Governance Best Practice Principles”.
12. Approval of the "Regulations on Financial and Business Transactions between Related
Parties" (replacing the "Regulations on Financial and Business Transactions with Group
Enterprises, Specific Companies and Related Parties").
13. Approval of the amendments to the “Sustainable Development Best Practice Principles”.
14. Approval of the establishment of the "Pre-Approval Policy for Non-Assurance Services" and
pre-approval list of non-assurance services.
15. Approval of the subjects of the 2023 regular shareholders’ meeting.
16. Approval of the acceptance of the proposals of shareholders holding more than one percent of
shares.
17. Approval of the evaluation of the independence and competency and appointment of attesting
CPAs.
18. Approval of the "Assessment of the Effectiveness of Internal Control System" and "Internal
Control System Statement " for 2022.
19. Approval of bank financing lines.
20. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.

  • (XII) If the directors have different opinions on the resolutions reached by the Board of Directors with a record or written statement made in the most recent year and the current year up to the date of publication of the Annual Report, please state the content of the opinion: None.

  • (XIII) For the most recent year or the current year up to the date of publication of the Annual Report, summary of the resignation and dismissal of the Company’s chairman, president, accounting officer, finance officer, internal audit officer, corporate governance officer, and R&D officer: None.

V. Information on CPA professional fees:

  • (I) Information on CPA professional fees:
Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD
CPA firm CPA name CPA audit period **Audit fees ** Non-audit fees
(Note)		 **Total ** Remark
Deloitte & Touche Hsin-Wei Tai 2022.01.01-2022.12.31 2,512 508 3,020
Pei-De Chen

Note: Non-audit fees include $408 thousand, for tax returns, $70 thousand, for government subsidy project audits, and $30 thousand, for review of full-time employee salary checklist for non-executive positions.

79

  • (II) The audit fees paid in the year of the replacement of CPA firm is less than the audit fees in the year before the change, The audit fees before and after the replacement should be disclosed and the reasons therefor: None.

  • (III) Where the audit fees have decreased by 10% or more from the previous year, the amount, percentage and reasons therefor should be disclosed: None

  • VI. Information on Replacement of CPAs: None

  • VII. Any of The Company’s Chairman, President, or managerial officers involved in financial or accounting affairs being employed by the auditor’s firm or any of its affiliated company within the recent year: None

  • VIII. Changes in transfer and pledge of shares by directors, managerial officers and shareholders with more than 10% shareholding in the most recent year up till the date of publication of this Annual Report

(I) Changes in shareholdings of directors, managerial officers and major shareholders

Job title Name 2022 2022 The current year up to April 15 The current year up to April 15
Increase(decrease)
in the number of
shares held		 Increase(decrease)
in the number of
sharespledged		 Increase(decrease)
in the number of
shares held		 Increase(decrease)
in the number of
sharespledged
Chairman/Chief
Strategy Officer
Major shareholder		 Jui-Fu Liu 0 0 0 0
Director and President Jui-Long Liu 0 0 0 0
Director Po-Wen Wang 0 0 0 0
Director Chih-Chun Liu 1,187,878 0 0 0
Independent Director Che-Fu Kung 0 0 0 0
Independent Director Wang-Ying Yu 0 0 0 0
Independent Director Chung-Lieh Kuo 0 0 0 0
Vice President Chin-Hsiang Hsu 0 0 (18,000) 0
Vice President Chao-Lai Wu 0 0 0 0
Vice President Anthony Tseng 0 0 0 0
Vice President Chen-Huan Li 0 0 (6,000) 0
Vice President Kuei-Sheng Yuan 0 0 0 0
Vice President Chun-Cheng Li 0 0 0 0
Vice President Shun-Liang Hsieh 0 0 0 0
Vice President Bing-Sen Su 0 0 0 0
Vice President Chin-Fen Wu 0 0 0 0
Vice President Nai-Cheng Cheng 0 0 0 0
Vice President Tsan-Chang Li 0 0 0 0
Sales Vice President Li-Chang Wu 0 0 0 0
Project Vice President Yen-Nien Hu 0 0 0 0
Sales Vice President Yu-Lung Hsueh 0 0 0 0
Sales Vice President Cheng-Tung Ko 0 0 0 0
Sales Vice President Hsu-Hung Chen 0 0 0 0
Sales Vice President
(Note 1)		 Kuang-Keng Liang (6,000) 0 0 0
Sales Vice President Shu-Ching Lin 0 0 0 0
Sales Vice President
(Note 2)		 Ming-Feng Li 0 0 0 0
Chief Technology
Officer		 Ching-Tzu Shih 0 0 0 0
Principal Division
Chief		 Jia-Chang Chang 14,000 0 (15,917) 0

80

Chief R&D Officer Tsai-Cheng Chen 0 0 (56) 0
Principal Division
Chief		 Tsai-Chi Sung 0 0 0 0
Principal Division
Chief		 Chih-Wei Wen 0 0 (25,286) 0
Chief Finance Officer Li-Chueh Du 0 0 0 0
Principal Division
Chief		 Ming-Kun Lin 0 0 0 0
Principal Division
Chief		 Chien-Yi Li 0 0 0 0
Principal Division
Chief		 Chih-Chung Chen (8,000) 0 (8,000) 0
Principal Division
Chief		 Feng-Lin Yen 0 0 0 0
Senior Assistant VP Mao-Ming Wang 0 0 0 0
Principal Division
Chief		 Ta-Yu Teng 0 0 0 0
Principal Division
Chief		 Po-Shu Hsueh 0 0 0 0
Assistant VP Kai-Tsung Wang 0 0 0 0
Principal Division
Chief		 Cheng-Wu Shao 0 0 0 0
Senior Assistant VP Mei-Ling Yang 0 0 0 0
Senior Division Chief Wen-Hsiung Yeh 0 0 0 0
Principal Division
Chief		 Kun-Ting Chiu 0 0 0 0
Division Chief Yen-Mei Lin 0 0 0 0
Principal Division
Chief		 Yung-Chen Yang 0 0 (9,000) 0
Division Chief Shu-Hua Liu 0 0 (3,000) 0
Principal Division
Chief		 Chao-Yi Wu 0 0 0 0
Senior Assistant VP Hung-Chun Chao 0 0 0 0
Division Chief Wen-Ching Tsai 0 0 0 0
Senior Assistant VP Chun-Yi Chao 0 0 0 0
Senior Division Chief Chia-Yuan Yeh 0 0 0 0
Division Chief Chia-Ru Liu 0 0 0 0
Senior Assistant VP
(Note 3)		 Hsiao-Shu Ma 0 0 0 0
Principal Division Chief Te-Li Chen 0 0 0 0
Principal Division Chief Yi-Lun Wang 0 0 0 0
Division Chief Chi-An Hsueh 0 0 0 0
Division Chief Chi-Hsiang Tang 0 0 0 0
Division Chief Nai-Fang Cheng 0 0 0 0
Senior Assistant VP Yao-Chang Chen 0 0 0 0
Principal Division Chief Yi-Ming Chang 0 0 0 0
Division Chief Ping-Chieh Wu 0 0 0 0
Division Chief Cheng-Yu Li 0 0 0 0
Senior Assistant VP Chia-Ching Li 0 0 0 0
Senior Assistant VP Tsang-Sung He 0 0 0 0
Principal Division Chief Huang-Hsiang Yang 0 0 0 0
Project Assistant VP
(Note4)		 Chen-Chou Huang 0 0 (950) 0
Division Chief Wen-Po Hsu 0 0 0 0
Division Chief Erh-Wei Dai 0 0 (500) 0
Principal Division Chief Hui-Yi Lin 5,000 0 (8,000) 0
Division Chief (Note 5) Chiung-Huang Chiang 0 0 0 0

81

Senior Assistant VP Tien-Chih Yen 0 0 0 0
Assistant VP Hao-Cheng Yang 0 0 0 0
Principal Division Chief Wan-Tan Lin 0 0 0 0
Principal Division Chief Fu-Chien Cheng 0 0 0 0
Division Chief Hung-Yi Lin 0 0 0 0
Division Chief Chiung-We Hsu 0 0 0 0
Principal Division Chief Chiu-Jung Chiang 0 0 0 0
Senior Assistant VP Shih-Fang Chang 0 0 0 0
Senior Assistant VP Chia-Hsu Hsiao 0 0 0 0
Assistant VP Li-Chun Lin 0 0 0 0
Acting Assistant VP Chin-Yu Chen 0 0 0 0
Principal Division Chief Rui-Ching Lin 0 0 0 0
Division Chief Mei-Feng Chang 0 0 0 0
Senior Division Chief Chih-Cheng Lin 0 0 0 0
Project Division Chief Kang-Yuan Fan 0 0 0 0
Assistant VP Wei-Min Chen 0 0 0 0
Division Chief Wei-Jen Cheng 0 0 0 0
Senior Division Chief Yu-Ting Tseng 0 0 0 0
Assistant VP Yi-Chun Liu 0 0 0 0
Project Division Chief Yen-Fu Chou 0 0 0 0
Principal Division Chief Chin-Yi Liao 0 0 0 0
Division Chief Chun-Feng Lin 0 0 0 0
Project Assistant VP Chun-Hua Liu 0 0 (3,000) 0
Project Assistant VP Chung-Chieh Wu 0 0 0 0
Assistant VP Hung-Yu Hsu 0 0 0 0
Principal Division Chief Min-Chung Huang 0 0 0 0
Assistant VP Po-Yi Chen 0 0 0 0
Division Chief Kuan-Chih Chen 0 0 0 0
Division Chief Chun-Fu Yang 0 0 0 0
Division Chief Ta-Jen Hsu 0 0 0 0
Division Chief Chung-Chun Lin 0 0 0 0
Senior Division Chief Tai-Yuan Hu 0 0 0 0
Division Chief Shu-Chuan Chiu 0 0 0 0
Project Assistant VP Yung-Kang Chang 0 0 0 0
Division Chief (Note 6) Hsu-Sheng Kao 0 0 0 0
Division Chief Meng-Hung Pan 0 0 0 0
Division Chief Fan-Ying Chang 0 0 0 0
Division Chief Yu-Hsiang Lin 0 0 0 0
Division Chief Yu-Chung Huang 0 0 0 0
Assistant VP Yu-Kang Tseng 0 0 0 0
Project Division Chief Tsang-Wei Chang 0 0 0 0
Senior Division Chief Wei-Pi Chou 0 0 0 0
Assistant VP Cheng-We Hung 0 0 0 0
Division Chief Chun-Tzu Chen 0 0 0 0
Assistant VP Chiu-Hua Lin 0 0 0 0
Acting Division Chief Yi-Hsuan Lai 0 0 0 0
Project Assistant VP Hsin-Jung Lu 0 0 0 0
Project Assistant VP Chia-Tzu Lin 0 0 0 0

82

Project Assistant VP Jo-Han Hsieh 0 0 0 0
Acting Assistant VP Chia-Yu Chen 0 0 0 0
Project Division Chief Ta-Chung Kuo 0 0 0 0
Project Division Chief Yu-Hsiang Lin 0 0 0 0
Project Division Chief Chih-Shan Chen 0 0 0 0
Division Chief Ching-Wang Huang 0 0 0 0
Division Chief Yuan-Chuan Yeh 0 0 0 0
Senior Division Chief Che-Zhe Liu 0 0 0 0
Project Assistant VP Yung-Pin Du 0 0 0 0
Division Chief Hsiang-Teng Yeh 0 0 0 0
Project Division Chief Ching-Hsun Hou 0 0 0 0
Division Chief Yu-Na Chiu 0 0 0 0
Division Chief Chih-Kai Hsu 0 0 0 0
Corporate Governance
Officer		 Chun-Yen Chen 0 0 0 0
Division Chief Shan-Mao Cheng 0 0 0 0
Assistant VP Ying-Ya Wang 0 0 0 0
Assistant VP Chen-Kai Hua 0 0 0 0
Acting Assistant VP Yu-Hsuan Kuo 0 0 0 0
Project Assistant VP Hsuan-Fa Huang 0 0 0 0
Project Assistant VP Kuo-Shu Hsu 0 0 0 0
Division Chief Yung-Ching Chen 0 0 0 0
Division Chief Chung-Yi Lin 0 0 0 0
Division Chief Hsin-Yi Li 0 0 0 0
Acting Division Chief Yu-Chia Hsiao 0 0 0 0
Division Chief Ting-Jung Chang 0 0 0 0
Division Chief Chia-Yi Tsao 0 0 0 0
Division Chief (Note7) Fu-Yuan Wen 0 0 0 0
Division Chief (Note 7) Yi-Feng Lai 0 0 0 0
Project Assistant VP
(Note 8)		 Yi-Ling Hsu 0 0 0 0
Project Assistant VP
(Note 8)		 Hung-Jen Hsiao 0 0 0 0
Project Assistant VP
(Note 8)		 Yi-Cheng Wu 0 0 0 0
Project Assistant VP
(Note 8)		 Sheng-Yu Chen 0 0 0 0
Division Chief (Note 9) Ling-Hao Chen 0 0 0 0
Division Chief (Note 10) Chun-Wen Yu 0 0 0 0
Division Chief (Note 11) Cheng-Heng Deng 0 0 0 0
Acting Assistant VP
(Note12)		 Ying-Ying Hsu 0 0 0 0
Division Chief (Note 13) Chi-Cheng Chih 0 0 0 0
Principal Division Chief
(Note14)		 Te-Kuei Chiu 0 0 0 0
Division Chief (Note 15) Hung-Jui Hsieh 0
0		 0
0
Division Chief (Note 15) Zhong-Yan Wu 0
0		 0
0
Division Chief (Note 15) Hao-Fan Liu 0
0		 0
0
Division Chief (Note 16) Chiung-Ying Tai 0
0		 0
0
Acting Division
Chief(Note 17)		 Yao-Jen Yeh 0
0		 0
0
Major shareholder Su-Chen Yang (1,187,878) 0 (92,000) 0

Note 1: Took office on January 17, 2022. Note 2: Took office on July 11, 2022. Note 3: Left office on February 28, 2023.

83

Note 4: Left office on March 20, 2023. Note 5: Left office on March 31, 2022. Note 6: Left office on May 31, 2022. Note 7: Took office on May 11, 2022. Note 8: Took office on June 1, 2022. Note 9: Took office on June 20, 2022. Note 10: Took office on July 1, 2022. Note 11: Took office on August 10, 2022. Note 12: Took office on August 22, 2022. Note 13: Took office on September 1, 2022. Note 14: Took office on November 5, 2022. Note 15: Took office on March 17, 2023. Note 16: Took office on March 22, 2023. Note 17: Took office on March 27, 2023.

(II) Information on the related party who is the counterparty of equity transfer:

Name Reason for the
equity transfer		 Transaction
date		 Counterparty
of the
transaction
Relationship between the
counterparty and the Company,
its directors and shareholders
holding more than 10% of the
stake
Number of
shares		 Transaction
price
Su-Chen
Yang		 Disposal (gift) 2022.11.24 Chih-Chun
Liu		 Mather and daughter 1,187,878 23.10

Except for the above-mentioned share transfers, all other transfers were transacted in the centralized order market and the counterparties were unrelated parties, so no disclosure was required.

(III) Information on the related party who is the counterparty of equity pledge: None.

IX. Information on the relationship among the top 10 shareholders if anyone is a related party, a spouse or a relative within second degree of kinship of another:

April 15,2023 April 15,2023 April 15,2023 April 15,2023 April 15,2023 April 15,2023 April 15,2023
Name Current
Shareholding		 Spouse’s/minor’s
Shareholding		 Shareholding
by Nominee
Arrangement		 Name and Relationship Between the Company’s Top
Ten Shareholders,or Spouses or Relatives Within Two
Degrees		 Remarks
Shares % Shares % Shares % Name Relationship
Jui-Fu Liu 18,346,787 18.35% 8,432,001 8.43% 0 0




 Su-Chen Yang
Furly
Chih-Chun Liu
Chi-Shan Liu
Chuan Gao		 Spouse
Spouse as its major shareholder
Father and daughter
Father and daughter
Natural person as its major shareholder		 None
Furly Investment
Co., Ltd.
Representative:
Bing-Sen Su		 8,529,801 8.53% 0 0 0 0




 Jui-Fu Liu
Su-Chen Yang
Chih-Chun Liu
Chi-Shan Liu
Chuan Gao		 Spouse of a major shareholder
The major shareholder
Child of a major shareholder
Child of a major shareholder
The spouse of the major shareholder
as its major shareholder		 None
Su-Chen Yang 8,432,001 8.43% 18,346,787 18.35% 0 0




 Jui-Fu Liu
Furly
Chih-Chun Liu
Chi-Shan Liu
Chuan Gao		 Spouse
Natural person as its major shareholder
Mother and daughter
Mother and daughter
Spouse of a major shareholder		 None
Chi-Shan Liu 7,598,911 7.60% 0 0 0 0




 Jui-Fu Liu
Su-Chen Yang
Furly
Chih-Chun Liu
Chuan Gao		 Father and daughter
Mother and daughter
Mother as major shareholder
Sisters
Father as major shareholder		 None
Chih-Chun Liu 4,375,567 4.38% 0 0 0 0




 Jui-Fu Liu
Su-Chen Yang
Furly
Chi-Shan Liu
Chuan Gao		 Father and daughter
Mother and daughter
Mother as major shareholder
Sisters
Father t as major shareholder		 None
Chuan Gao
Investment Co.,
Ltd.
Representative:
Meng-Chih Han		 2,717,497 2.72% 0 0 0 0




 Jui-Fu Liu
Su-Chen Yang
Furly
Chih-Chun Liu
Chi-Shan Liu		 The major shareholder
Spouse of a major shareholde
The spouse of the major shareholder as
its major shareholder
Child of a major shareholder
Child of a major shareholder		 None
Investment
account held by
HSBC in custody		 850,000 0.85% 0 0 0 0 None None None

84

for Ensign Peak
Advisors Inc.
Investment
account held by
HSBC in custody
for Acadian
Emerging Market
Small-Cap Equity
PrimaryFund		 688,000 0.69% 0 0 0 0 None None None
Shui-Ching Lai 513,000 0.51% 0 0 0 0 None None None
Chih-Yung Li 444,000 0.44% 0 0 0 0 None None None

X. The total number of shares and the consolidated equity stake percentage held in any single reinvested enterprise by the Company, its directors, managerial officers, or any companies controlled either directly or indirectly by the Company

December 31, 2022

Unit: Shares; %

December 31, 2022
Unit: Shares;%		 December 31, 2022
Unit: Shares;%
Investee
(Note)		 Investment by the Company Investment by directors,
managerial officers, and
any companies controlled
either directly or indirectly
bythe Company		 Total investment
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Casemaker Inc. 1,300,000
100.00%
0
0
1,300,000
100.00%
Netmaker Technology Co., Ltd. 2,857,800
86.60%
23,100
0.70%
2,880,900
87.30%
Wisemaker Technology Co. 2,665,350
98.72%
6,750
0.25%
2,672,100
98.97%
Syscom Computer (Thailand) Co., Ltd. 3,399,997
91.40%
45,002
1.21%
3,444,999
92.61%
Coach Technology Management Inc. 1,949,994
97.50%
10,001
0.50%
1,959,995
98.00%
Syscom International Inc. 6,050,000
100.00%
0
0
6,050,000
100.00%
DBMaker Japan Inc. 5,326
49.89%
0
0
5,326
49.89%
Cloudmaster Co., Ltd. 6,500,000
50.00%
0
0
6,500,000
50.00%

Note: The Company’s investments accounted for using the equity method

85

Four. Fund raising

I.Capital and stock

(I) Sources of capital:

April 15, 2023

April 15, 2023 April 15, 2023
Year/
month		 Issue
price		 Authorized capital Paid-in capital Remark
Number of
shares
(Thousands
of shares)		 Amount
(Thousands of
NTD)
Number of
shares
(Thousands
of shares)		 Amount
(Thousands of
NTD)		 Sources of capital Using property other
than cash as payment
of shares		 Date of approval of capital
increase and document
number
1975/07 100 10
1,000
10
1,000		 Establishment None -
1978/07 100 20
2,000
20
2,000		 Capital increase of $1 million
by cash		 None NO. 84015
1979/05 100 100
10,000
100
10,000		 Capital increase of $8 million
by cash		 None NO. 91731
1983/03 100 250
25,000
250
25,000		 Capital increase of $15 million
by cash		 None Jing-(1983)-Shang No. 10071
1989/01 100 1,010
101,000
1,010
101,000		 Capital increase of $76 million
by cash		 None Jing-(1989)-Shang No.
003593
1989/12 10 19,500 195,000 19,500 195,000 Capital increase of $94 million
by cash		 None Jing-(1989)-Shang No.
134024
1990/11 10 60,000 600,000 60,000 600,000 Capital increase of $405
million by cash		 None Jing-Tao-Shen-(1990)-Gong-
Shang-Zi No. 8136
1993/10 10 72,000 720,000 72,000 720,000 Capital increase of $120
million from earnings		 None Jing-Tao-Shen-(1993)-Gong-
Shang-Zi No. 7679
1995/10 10 75,600 756,000 75,600 756,000 Capital increase of $36 million
from earnings		 None Jing-(1995)-Shang No.
114199
2001/07 10 157,000 1,570,000 88,452 884,520 Capital increase of $128.52
million from earnings		 None Jing-(2001)-Shang-Zi No.
09001269100
2002/07 10 157,000 1,570,000 94,201 942,014 Capital increase of $57.49
million from earnings		 None Jing-Shou-Shang-Zi No.
09101358220
2005/09 10 157,000 1,570,000 100,000 1,000,000 Capital increase of $57.99
million from earnings		 None Jing-Shou-Shang-Zi No.
09401180640
Unit: Shares
Type of shares Authorized capital Remark
Outstanding shares Unissued shares Total
Listed on TWSE
(TPEx)
Unlisted on
TWSE (TPEx)		 Total
Registered common
shares		 100,000,000 - 100,000,000 57,000,000 157,000,000 Shares of TWSE-
listed companies

(II)Shareholder Composition

(II) Shareholder Composition (II) Shareholder Composition (II) Shareholder Composition (II) Shareholder Composition (II) Shareholder Composition (II) Shareholder Composition (II) Shareholder Composition
April 15, 2023
Shareholder
Composition
Number

Government
agency		 Financial
institution		 Other
corporation		 Individual Foreign
institution and
foreigner		 Total
Number of people 0 0 27
13,017
42
13,086
Number of shares
held		 0 0 11,668,143
83,847,972
4,483,885
100,000,000
Shareholding
percentage		 0% 0% 11.67%
83.85%
4.48%
100.00%

Note: The shareholding percentage by Mainland Chinese investors in the Company is 0.

86

(III) Distribution of Shareholding

II) Distribution of Shareholding
April 15, 2023
Shareholding range Number of
shareholders		 Number of shares
held		 Shareholding
percentage
1 to 999 2,317
366,029
0.37%
1,000 to 5,000 9,152
16,689,089
16.69%
5,001 to 10,000 934
7,610,909
7.61%
10,001 to 15,000 224
2,922,657
2.92%
15,001 to 20,000 172
3,208,225
3.21%
20,001 to 30,000 113
2,938,422
2.94%
30,001 to 40,000 40
1,431,220
1.43%
40,001 to 50,000 39
1,797,842
1.80%
50,001 to 100,000 52
3,888,066
3.89%
100,001 to 200,000 21
2,846,095
2.85%
200,001 to 400,000 9
2,534,320
2.53%
400,001 to 600,000 5
2,228,562
2.23%
600,001 to 800,000 1
688,000
0.68%
800,001 to 1,000,000 1
850,000
0.85%
More than 1,000,001 6
50,000,564
50.00%
Total 13,086
100,000,000
100.00%
  • (IV) List of major shareholders (Name of the top ten shareholders in terms of shareholding percentage)
April 15, 2023 April 15, 2023 April 15, 2023
Shareholding
Name of major shareholder
Number of
shares held		 Shareholding
percentage
Jui-Fu Liu 18,346,787
18.35%
Furly Investment Co., Ltd. 8,529,801
8.53%
Su-Chen Yang 8,432,001
8.43%
Chi-Shan Liu 7,598,911
7.60%
Chih-Chun Liu 4,375,567
4.38%
Chuan Gao Investment Co., Ltd. 2,717,497
2.72%
Investment account held by HSBC in custody for Ensign Peak
Advisors Inc.		 850,000
0.85%
Investment account held by HSBC in custody for Acadian
Emerging Market Small-Cap Equity Primary Fund		 688,000
0.69%
Shui-Ching Lai 513,000
0.51%
Chih-Yung Li 444,000
0.44%

87

(V) Information on market price, net worth, earnings, dividends per share for the most recent two years

Item Year Year 2021 2022 2023 up to April 15
(Note 8)
Market price per
share (Note 1)		 Highest 32.25 32.10
71.90
Lowest 16.60 22.85
25.45
Average 25.27 27.37
56.54
Net worth per
share(Note 2)		 Before distribution 19.64 20.50
21.36
After distribution 17.74 18.30
19.16
Earnings per
share		 Weighed average number of shares 100,000,000
100,000,000
100,000,000
Earnings per
share(Note 3)		 Before adjustment 2.16
2.51
0.84
After adjustment 2.16
2.51
0.84
Dividends per
share		 Cash dividends 1.90
2.20
-
Stock
dividends		 Stock dividends
from earnings		 -
-
-
Stock dividends
from capital surplus		 -
-
-
Accumulated
(Note 4)		 unpaid dividends -
-
-
Investment return
analysis
Price to earnings ratio (Note 5)		 10.86
10.40
-
Price to dividends ratio (Note 6) 12.34
11.86
-
Cash dividends yield (Note 7) 8.10%
8.43%
-

  • Note 1 ： List the highest and lowest market prices of each year, and calculate the average market price of each year based on the transaction value and volume of each year.

  • Note 2 ： Enter based on the number of shares issued at the end of the year and the distribution in accordance with the resolution of the shareholders' meeting of the following year.

  • Note 3 ： If there is a retroactive adjustment due to circumstances such as stock dividend, etc., earnings per share before and after the adjustment should be shown.

  • Note 4 ： If equity securities are issued with terms that allow dividends unpaid in the current year to be accrued and accumulated until the year the Company makes a profit, the amount of accumulated undistributed dividends as of the current year should be disclosed separately.

  • Note 5 ： Price to earnings ratio = Average closing price per share for the year/earnings per share

  • Note 6 ： Price to dividends ratio = Average closing price per share for the year/cash dividends per share.

  • Note 7 ： Cash dividends yield = cash dividends per share/average closing price per share for the year

  • Note 8 ： Net worth per share and earnings per share should be presented with the data for the most recent quarter audited (reviewed) by CPAs as of the date of publication of the Annual Report; the remaining fields should be presented with the data for the current year as of the date of publication of the Annual Report.

  • (VI) Dividend policy and implementation status

    1. The Company’s dividend policy:

      • (1) Dividend policy as stipulated in the Company's Articles of Incorporation

        • To ensure the Company’s stable growth, sustainable development, and long-term development, the Company considers the its future capital needs and long-term financial planning and distributes dividends with a moderate combination of cash and stock dividends, with balanced and stable dividends maintained, while determining the type, amount, and time of the dividends to be distributed as per the year’s profit, capital budget planning, and capital amount. The Company shall distribute cash dividends at no less than 10% of the total dividends to be distributed in the year; however, if it has more abundant surplus and capital, it may raise said percentage.

      • (2) When distributing the Company's annual earnings as concluded by year-end accounting close, after paying all taxes, the Company shall first make up for prior years' losses and set aside 10% as legal reserve, except that when the accumulated legal reserve has reached the amount of total capital, no further provision shall be necessary; for the remainder, a special reserve shall be set aside or reversed as provided by law, and if there is any remaining balance, dividends can be made in an amount no less than 50% of the current year's profit after tax, provided that no other special circumstances apply.

2. Implementation status:

Dividend distribution proposed at the shareholders' meeting:

The Company's net profit after tax for 2022 is NT$250,729,580 and the legal reserve is NT$26,506,123 provided for in accordance with the regulations so the total amount of earnings available for distribution for the year is NT$696,449,668. A cash dividend of NT$220,000,000 (NT$2.2 per share) to shareholders is proposed for 2022 earnings distribution by the Board of

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Directors.

  • (VII) The effect of the proposed stock dividends of shares at the shareholders' meeting on the Company's operating results and earnings per share: Not applicable.

  • (VIII)Profit-sharing remuneration for employees and directors

    • 1.The percentage or range of profit-sharing remuneration for employees, directors and supervisors as set forth in the Articles of Incorporation:

    • (1)Article 21 of the Company's Articles of Incorporation: If the Company makes a profit in a fiscal year, it shall allocate no less than 3% of the balance as employee remuneration, which shall be distributed in stock or cash as per the resolution by the Board of Directors. The recipients shall include employees of the controlling company or subsidiaries who met certain criteria. The distribution of employee remuneration shall be reported to the shareholders’ meeting. However, when the Company still has a cumulative deficit, it shall reserve an amount to compensate it first and then allocate an amount for employee remuneration according to the percentage set out in the preceding paragraph.

    • (2)Article 18 of the Company's Articles of Incorporation: The Board of Directors is authorized to determine the remuneration to the Chairman and directors based on their involvement in the Company's operations, the values of their contributions, and the general standard in the industry. All directors may be paid with honoraria depending on the actual situation.

    • (3)The Company's directors are currently paid only with the fixed monthly salary, travel expenses or attendance fees, and no variable remuneration.

    • 2.The basis for estimating the amount of remuneration to employees, directors and supervisors, the basis for calculating the number of shares for employee remuneration distributed in stock, and the accounting treatment if the actual amount distributed differs from the estimated amount: The profit-sharing remuneration for employees and directors for 2022 is estimated based on the provisions set forth in the Articles of Incorporation and is paid in cash and approved by the Board of Directors. If there is any difference between the actual amount and the estimated amount, it will be treated as a change in accounting estimate and will be adjusted in the year of the resolution of the shareholders' meeting.

    • 3.Distribution of profit-sharing remuneration approved by the Board of Directors

    • (1)Distribution of profit-sharing remuneration for employees and directors: The Board of Directors resolved to distribute profit-sharing remuneration for employees of NT$9,600,000 in cash and for directors of NT$0. The proposed distribution amount is not different from the estimated amount of expenses recognized in 2022.

    • (2)The amount of employee remuneration distributed in stock and its proportion to the sum of net profit after tax and total employee remuneration on the parent company only or standalone financial statements for the period: Not applicable.

    • 4.The actual distribution of the remuneration for employees, directors and supervisors in the previous year (including number of shares distributed, amount and share price), and if it is different from the remuneration recognized, the amount of the difference, the reason for the difference and the treatment of the difference should be disclosed:

    • In 2021, the Company distributed profit-sharing remuneration for employees of NT$8,450,000 in cash and for directors and supervisors of NT$0, which are not different from the amounts recognized in the financial statements.

  • (IX) Share Repurchases by the Company: None

  • II. Issuance of Issuance of Corporate Bonds: None

  • III. Issuance of preferred shares: None

  • IV. Issuance of Global Depositary Receipts: None

  • V. Employee Share Subscription Warrants: None

  • VI. New Restricted Employee Shares: None

  • VII. Issuance of new shares in connection with mergers or acquisitions of shares of other

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companies: None

VIII.Capital utilization plan and implementation status

  • (I) Contents of the plan

  • 1.As of the quarter up to the date of publication of the Annual Report, the previous issuance or private placement of securities that had not been completed: None.

  • 2.Previous issues or private placements of marketable securities that have been completed within the last three years and the benefits of the plans have not yet been realized: None.

  • (II) Implementation status: Not applicable

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Five. Operations overview

I. Business activities

  • (I) Business scope

  • 1.Main businesses conducted:

  • (1) E601010 Electric Appliance Construction

  • (2) E603050 Automatic Control Equipment Engineering

  • (3) E605010 Computer Equipment Installation

  • (4) E701010 Telecommunications Engineering

  • (5) E701020 Satellite Television KU Channels and Channel C Equipment Installation

  • (6) E701030 Controlled Telecommunications Radio-Frequency Devices Installation Engineering

  • (7) E701040 Simple Telecommunications Equipment Installation

  • (8) EZ05010 Instrument and Meters Installation Engineering

  • (9) EZ99990 Other Engineering

  • (10) F108031 Wholesale of Medical Devices

  • (11) F113010 Wholesale of Machinery

  • (12) F113030 Wholesale of Precision Instruments

  • (13) F113050 Wholesale of Computers and Clerical Machinery Equipment

  • (14) F113070 Wholesale of Telecommunication Apparatus

  • (15) F113110 Wholesale of Batteries

  • (16) F113990 Wholesale of Other Machinery and Tools

  • (17) F118010 Wholesale of Computer Software

  • (18) F119010 Wholesale of Electronic Materials

  • (19) F208031 Retail Sale of Medical Apparatus

  • (20) F213030 Retail Sale of Computers and Clerical Machinery Equipment

  • (21) F213040 Retail Sale of Precision Instruments

  • (22) F213050 Retail Sale of Measuring Instruments

  • (23) F213060 Retail Sale of Telecommunication Apparatus

  • (24) F218010 Retail Sale of Computer Software

  • (25) F219010 Retail Sale of Electronic Materials

  • (26) F401010 International Trade

  • (27) F601010 Intellectual Property Rights

  • (28) G903010 Telecommunications Enterprises

  • (29) I103060 Management Consulting

  • (30) I301010 Information Software Services

  • (31) I301020 Data Processing Services

  • (32) I301030 Electronic Information Supply Services

  • (33) I501010 Product Designing

  • (34) I599990 Other Designing

  • (35) J202010 Industry Innovation and Incubation Services

  • (36) J303010 Magazine (Periodical) Publishing

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  • (37) J304010 Book Publishing

  • (38) JA02010 Electric Appliance and Electronic Products Repair

  • (39) JA02990 Other Repair

  • (40) JE01010 Rental and Leasing

  • (41) ZZ99999 All business items that are not prohibited or restricted by law, except those that are

  • subject to special approval

  • 2.Sales percentage:

Main products and sales percentage in 2022 Main products and sales percentage in 2022
Main products Sales percentage (%)
System Integration Service &
Computer Sales		 77
Computer & Peripheral Maintenance 23
Computer & Peripheral Lease -
Total 100

  • 3.Current products (services) of the Company:

  • SYSCOM COMPUTER’s services range from front-end planning, design, implementation, overall project management, consulting services, and integrated information system services. Main products/services are as follows.

  • (1) Planning, construction and maintenance services for system integration

  • (2) Electronic transaction processing and real-time risk management system

  • (3) Planning, construction and maintenance services for securities information management solution

  • (4) Planning, construction and maintenance services for futures information management solution

  • (5) Planning, construction and maintenance services for banking information management solution

  • (6) Planning, construction and maintenance services for medical information management solution

  • (7) Planning, construction and maintenance services for intelligent bed solution

  • (8) Planning, construction and maintenance services for NIS solution

  • (9) Planning and construction of Network-Cloud network architecture

  • (10) Planning, construction, and design services for telecommunications and enterprise SDDC

  • (11) Planning, construction, and design services for SD-WAN

  • (12) Planning, construction, and design services for SASE solution

  • (13) Planning, construction, and design services for road management and automated information security solutions

  • (14) Planning and construction for AI platform storage system

  • (15) Planning, construction, and maintenance services for telecommunication network backbone

  • (16) Overall planning, design and construction of large data center

  • (17) Customized design of telecommunication network management, information security and continuous configuration solutions

  • (18) Planning, construction and maintenance services for telecom value added service application solutions

  • (19) Smart mobile ticketing system

  • (20) Intelligent operation management system for bus transfer stations

  • (21) Planning, construction, maintenance/continuous configuration services for public service agency shared data center

  • (22) Planning, construction, and maintenance of network communication and information security gateway infrastructure for upward centralization of information resources in public offices and their affiliated agencies (organizations)

  • (23) Business application systems and basic service systems for public offices (public affairs

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manpower management system interface, directory services, document file management, electronic mail, mail security gateway...) Planning, construction and maintenance services

  • (24) Planning, construction and maintenance services for HCI solution

  • (25) Planning, implementation, and maintenance services for cloud-sensitive project collaboration platform and personal virtual workspace solution

  • (26) Construction and maintenance/continous configuration services for new generation security operations (SecOps) information security incident management and information security linkage platform

  • (27) Planning for digital account online account opening system

  • (28) Information consulting services, information security services and manpower outsourcing services

  • (29) Consulting, planning and implementation services for overall information security architecture

  • (30) Overall planning and design for information security (Security) area joint defense

  • (31) Computer facility management outsourcing services

  • (32) Professional consulting services, professional management and maintenance services

  • (33) Planning, construction and maintenance services for cloud database and application system solution

  • (34) SYSCOM cloud computing services and cloud technology integration solutions

  • (35) System performance tuning and testing services

  • (36) Planning, construction and maintenance services for securities/futures high frequency transactions

  • (37) Service-based Robot,Ayuda

  • (38) E-Government Planning,Construction&Maintenance Services

  • (39) Self-developed enterprise integrated solutions and sales for AI, 5G, information security, big data and cloud applications

  • (40) (For more information on SYSCOM's self-developed enterprise integration solutions, please refer to SYSCOM syscomgo website)

  • 4.New products (services) planned to be developed (including those under on-going development).

  • (1) Secure Terminal Emulator – DRSE

  • (2) AYUDA

  • (3) DBMaker Docker Image

  • (4) Opus One IP Continuous Configuration Management Platform

  • (5) Shopping mall robots

  • (6) Anti-pandemic service robots

  • (7) OMFLOW Continuous Configuration Automation module

  • (8) Hyper Automation Scanning Task Framework

(II) Industry overview

  1. Current status and development of the industry

The information service industry is an indispensable part of national competitiveness, especially at a time of digital transformation and development of industries. The new generation of industrial competition and even national conflicts have highlighted the importance of information security. From the inauguration of the “Ministry of Digital Affairs” on August 27, 2022 to the establishment of the “National Institute of Cyber Security” on January 1, 2023, the government's emphasis on "information security is national security" is not just a slogan, but a way to enhance the overall information security technology capability of the country.

In the sixth phase (2021-2024) of the development direction of cyber security of the Executive Yuan, "active defense", "zero trust" defense in depth, application of emerging technologies to develop active defense technologies, and enhancement of technological detection capabilities are emphasized. The amendments to the “Cyber Security Management Act” also specify that A and B level public agencies should introduce endpoint detection and response mechanism (EDR) to strengthen detection and implement incident investigation and notification. On December 27, 2022, the FSC released the "Financial Information Security Action Plan"

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Version 2.0, which requires listed companies to set up information security units, assign information security officers, introduce international information security standards, and conduct information security attack and defense drills...etc., in order to continuously enhance the information security capabilities of financial institutions and serve as the basis for the innovative development of financial technology.

The future is the era of Internet of Things and artificial intelligence, collectively called AIOT, especially in the era of cloud and AI artificial intelligence, investment costs are relatively low, and with the advancement of 5G and AIOT technology, the integration of cloud and information security technology will be accelerated by smart technology and applications. Taiwan has superior geographical advantages, and as long as software vendors are well prepared to operate internationally, the future is full of business opportunities. As software is the basis for supporting hardware transformation, and the integration of software and hardware in the information and communication industry will become a trend in the future. Asia Silicon Valley 2.0 (promotion period from 2021 to 2024) is based on the two main axes of "Smart IoT Accelerates Industrial Evolution" and "Innovation and Entrepreneurship Drives the Future of Industry". It will actively introduce key technologies such as 5G and AI in the digital economy, encourage the export of AIoT solutions to the international market, and accelerate the growth and emergence of new businesses, with the aim of making Taiwan a key force in digital innovation in Asia.

  1. Correlations among the upstream, midstream and downstream industries

Taiwan's computer system software service industry has thousands of companies, which can be further divided into software service industry, system integration service industry, and other system design service industry, where the computer software service industry accounts for about 90% of the total, with system integration being the largest. The system integration service operators provide services ranging from front-end planning, design, implementation, overall project management, consulting services, and integrated information system services, etc., based on the specific operational needs of customers. Most of the system integration service projects include different platforms and technologies, such as system and custom application development and integration of existing application software. Because of the high degree of customization in system integration projects, each project must establish a contract to define the specifications of the solution and the output performance at different levels. The final project output is a complete system that meets the purpose and technical specifications of the project definition.

Since its establishment, SYSCOM COMPUTER has been dedicated to large scale system integration and information application services, not only distributing software and hardware products from internationally renowned IT companies, but also utilizing its rich domain knowhows accumulated in different fields to provide customers with the best professional information services and assist enterprises in their digital transformation. development. The upstream industries include Cisco, Dell/EMC, Fortinet, Google Cloud Platform, HPE, Microsoft, VMWare, and other software and hardware manufacturers or agents, while the downstream covers financial institutions, telecom operators, government agencies, medical institutions, transportation, educational institutions, manufacturing areas, and other end-user organizations.

  1. Development trends and competition of products

  2. (1) Information security

With the impact of geopolitics, the new post-pandemic hybrid office norm, and the acceleration of enterprises' move to the cloud, the main focus of information security in 2023 is to continue to promote zero-trust and identity security, as well as password-free authentication; regarding the construction of protection systems, both the chief information security officer and public sector policies are key; in response to the accelerated pace of digital transformation, software supply chain protection and network security maturity model certification have also become the focus of IT industry development. Enterprises should adopt a zero-trust strategy to protect the environment and systems, adopt an integrated information security platform to improve information security transparency, invest in employee education and training, identify weaknesses in IT infrastructure through stress tests, and take stock of cloud services, which will help strengthen information security defense strategies and enhance the effectiveness of risk management.

  • (2) Cloud application services

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Although the pandemic is gradually easing, there are still factors such as labor shortage, supply chain and inflation in the market, and the demand for cloud solutions from small and medium-sized enterprises is heating up. 65% of information service providers in Taiwan have planned or provided SaaS services, and IDC estimates that by 2025, 30% of small and medium-sized enterprises worldwide will move half of their core work to the cloud.

  • (3) Smart cities derive new smart services

"Smart cities" is a new concept in the planning, construction and governance of the world's major cities in recent years. The new generation of information technology, such as the Internet of Things, cloud computing, smart terminals, artificial intelligence, virtual reality, augmented reality, unmanned aerial vehicles, and building information models, are widely applied to urban infrastructure, companies and factories, and home life. It is an important indicator for governments to build smart cities to enhance the competitiveness of cities.

  • (4) Smart healthcare

According to the definition of WHO, smart health refers to the application of information and communication technology (ICT) in the field of health care, including medical care, public health monitoring, etc. The year 2022 can be said to be the first year of Taiwan's medical digitalization. After the four major medical regulations have been liberalized, with the powerful ties of technology, the "future hospital" will integrate software, hardware, data, and services, which will not only greatly improve the quality of services, but also begin to "decentralize" the entire medical practice.

  • (5) Service robots for commercial use

The robotics industry has become one of the key pillar industries in the global economy. IFR (International Federation of Robotics) estimates that the global robotics market will reach US$51.3 billion by 2022. In terms of market structure, the global robotics industry is currently composed of industrial robots, service robots and special robots. More and more companies recognize that robots cannot replace human work, but are a way to enhance the efficiency of human employees. As more industries face worrying skill and labor shortages, robots are becoming a necessary way to fill the growing gap, but about 35% of organizations want robotics to be applied in combination with other technologies to empower humans and gradually address labor shortages.

  • (6) Green/sustainable IT

According to the ITHome 2022 CIO Survey, ESG corporate sustainability is in the top 10 annual goals for CIOs for the first time, with the majority of CIOs in the financial and high-tech industries. The most common IT practices of enterprises in response to ESG are paperless, energy saving in server rooms and going to the cloud. A few enterprises have also started to establish systematic carbon inventory monitoring mechanisms or develop carbon footprint dashboards to strengthen data monitoring and management. ESG sustainability attempts to link IT closely to the environment, applying it to different areas of corporate IT such as procurement, water resources, and technology product lifecycles to achieve environmental sustainability.

  • (7) Outsourcing services

With the recent wave of digital transformation and the changing structure of the information workforce, "outsourcing IT services" has become a top choice for business managers. According to a McKinsey survey, more than 85% of global organizations are facing a talent shortage, which has led to an increase in outsourcing in the IT field. Global organizations recognize the importance of IT in business development and see digital transformation and innovation as a top priority. The software development industry will continue to grow rapidly in the coming years, especially in the AI and ML fields, and the demand for technology talent will also rise.

  • (III) Technology and R&D overview

  • R&D expenses for the most recent year and for the current year up to the date of publication of the Annual Report

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Unit: Thousands of NTD

Unit: Thousands of NTD
Year Amount As a percentage of
operating revenue
2021 217,379
3.70%
2022 230,033
3.87%
1Q2023 53,306
4.28%

  • 2.Technologies and products developed in the most recent year and in the current year up to the date of publication of the Annual Report

  • (1) DBMaster DataBase

Develop DBMaster DataBase, combine multimedia and Internet ISV (Independent Software Developer) database requirements, provide Japanese software developer version, develop Indexing Locking function, integrate Japanese search engine and security control mechanism, and develop related electronic solutions.

  • (2) DBMaker CloudDB

Develop DBMaker CloudDB to meet the needs of cloud service SaaS (independent software developer) database, provide cloud developer version, develop cloud connection interface (Cloud ODBC) function, integrate cloud search engine and security control mechanism, and develop related cloud solutions.

(3) DBMaker BigData DB

Based on the core technology of the existing database system, we extend the core engine for huge amount of data, so that it has both SQL and No-SQL data storage and management capabilities.

  • (4) RFID Intelligent Traffic and Transportation Platform

Through RFID identification, integrate gates, card readers, ticketing displays, passenger information, human voice broadcasting, license plate recognition, RFID, induction coils, LED warning lights, joint ticketing and automatic ticketing machines, etc., and integrate related information into one map control system, with back-end systems for passenger and vehicle dispatch management, financial accounting and personnel, cost analysis, etc., all the way to computerized ticketing at each ticket station, PDA scanning line uploading, etc., providing a new generation of intelligent transportation platform

(5) CMMI Solution – SDPM

In the process of electronic enterprise process, personnel in each work unit can be recorded according to their different work nature and content, and the platform can be used to review the project schedule and submit project work progress for individual work management, project management, and supervision and performance evaluation by direct supervisors. In view of the approaching tablet world and the increasing diversity of user devices, it is impossible for organizations to expand their electronic data collection due to the limitation of old technologies. Use the .NET development framework, not only to enhance the userfriendliness of User Interface and the commonality with other tools, but also to provide firsthand online data feedback with the project management tool module as the basis for decision support.

Also develop a WCF architecture on Microsoft Azure, which supports local key-in to the connected server and then aggregates back to the headquarters in a fixed time and place, and integrates back to the headquarter in the form of data storage, so that the headquarters can command from a thousand miles away.

  • (6) Health Examination Management System

The trend of medical services has shifted from passive diagnosis and treatment of diseases to more aggressive treatment of diseases before they occur, and health examination has become one of the main sources of income for medical institutions. SYSCOM's Health Examination Management System is designed to meet these needs, with an intelligent processing mechanism that automatically connects all aspects of booking, scheduling, billing, report editing/data compilation/reporting, and a full range of custom development services to

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comprehensively and quickly integrate patient health information, fully utilizing the advantages of health examination centers/medical institutions' high-standard medical resources to build the most complete health examination information service solution.

  • (7) (NMS/EMS) NDS (Netwrok Dimenstion System) Advanced Module - SDN Network Management Module

The SDN network management module of NDS (now called Service Provision Management System, SPMS Openflow version) can integrate the new Openflow switches and controllers of telecommunication companies with the basic monitoring functions of NDS, providing telecommunication companies with the ability to assemble service provisioning templates based on the Openflow network equipment, service equipment (such as DPI, firewall) and network flow required by customers' telecommunication services (such as Internet, cloud and information security and other network services). When a customer applies for service, the SPMS automatically generates a service provisioning web page to present the service setup process and fill in the required information to complete the opening of the customer's service application, and can be delivered to general staff (e.g. counter staff) for execution and provide the ability to immediately modify the process at any time according to changes in the service content. This enables telecom operators to achieve the goals of rapid and automated service completion, reduced service management and training costs, and improved management efficiency.

  • (8) Next Generation Healthcare Information Syscom

The Next Generation Healthcare Information Syscom (e-Healthcare) is a next-generation medical information system designed and developed to integrate the needs of medical administration, examination/testing, nursing operations, business decision making, and medical imaging. The e-Healthcare adopts SOA service-oriented architecture design to construct a standard development operating platform for medical systems; the construction of paperless workflow and the construction of an automated audit mechanism will enhance the efficiency of the overall use of medical resources and optimize the effectiveness of hospital workflow. The e-Healthcare is highly scalable, flexible, and customizable, and its complete operational functions fully satisfy the practical needs of every aspect of modern hospital operations.

  • (9) Futures Risk Control Rapid Mid-End System

Adopt Linux server platform, high performance in-memory design, innovative parameterized and modular design, and provide complete risk control and flexible customization design, and integrates with NSK back-office billing system, covering the following functions:

  • a. Trading functions: order/transaction/closing, order deletion/volume change/price change/long/short, multiple orders, SPAN/optimization (virtual group), ROD/FOK/IOC, hedge/funding/stock selection, part split/group, USD gold commodity, option hybrid commodity, parent/child account/instant inquiry account.

  • b. Monitoring and management functions: PVC monitoring and commissioning, Log inquiry, automatic time calibration with the exchange.

  • c. Abnormality handling function: automatic last inquiry, automatic return on transaction for broken lines, Fail-Over mechanism.

(10) Securities Risk Control Rapid Mid-End System

Adopt Linux server platform, high performance in-memory design, innovative parameterized and modular design, and provide fast order placement, complete risk control and flexible customization design, and integrates with NSK back-office billing system, covering the following functions:

  • a. Risk control functions: General trading, zero shares, after-hours pricing, new orders for auction, volume change and deletion, common stocks, ETFs, warrants, securities borrowing and selling risk control, risk control can flexibly choose risk control / no risk control / forced risk control, inventory, quota can be controlled according to sub-account / external account / group hierarchy, Gateway inter-trading transfer back, into back, notification of intraday movement operations.

  • b. Order placement interface: Login, order placement, two-stage report, supplemental report, disconnection notification.

  • c. Query functions: Query the subaccount and external account's stock account's order limit, various settings and total transaction details of the day, query the subaccount and external account's stock account's stock account's order limit, various settings and total transaction details of the day, current day account and external account's order transaction details and

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transaction details.

  • d. Modify functions: Mandatory order deletion, investor movement processing, BASE data file adjustment, investor inventory RELOAD, mandatory order deletion inquiry, movement data inquiry.

  • e. Monitoring functions: Show the normal variation by red and green lights, monitor the status of TradePass running programs in multiple centers at the same time, wind control module Thread running status Queue status, automatically detect the program and restart it, or manually start/stop, selectable warning sound files, and set the monitoring interval.

  • f. Abnormality handling function: automatic last inquiry, automatic return on transaction for broken lines, fail over mechanism.

(11) NCBS

Plot the overall NCBS solution to meet the current financial environment and internationalization trend to meet customer needs and enhance the quality of service.

Nowadays, banks using NONSTOP Server have changed their business model from providing funds to providing services for profit. The information system must not only support the financial related business, but also meet the diversified needs of customers, directly target the customer base and understand the needs of customers to create a competitive niche. Therefore, the development direction of banks must be closely integrated with their core systems in order to provide customers with unlimited location, time and high value-added financial transaction activities and services; and in order to achieve this goal, banks actively understand various financial-related information technology and the growth trend of the domestic and international financial environment. In order to achieve this goal, banks are actively understanding various financial related information technologies and the growth trend of the financial environment in Taiwan and abroad.

In view of this, we have reviewed our strategic positioning, explored new service opportunities, and changed our current core system design framework from a traditional transaction-oriented system design framework to a customer product-oriented system design framework, in order to meet the needs of banks and utilize information technology for internal process and organizational transformation, so that banks can enhance their operational management capabilities. The functions encompass:

  • a. Transaction modules: CIF, incident setting and maintenance, product pricing, product promotion, summons authentication format setting, quota control and handling fee setting, transaction message management, and operation authority management.

  • b. Operation systems used: CIF system, deposit system, time system, integrated deposit system, bill collection system, lending system (transfer to overdues for collection, bad debt), integrated loan system, accounting system.

  • c. Transaction account platforms - Q File/ On-Line & Batch Long Stady Process 。

  • d. Information center batch operations.

  • e. Various management reports.

  • f. Operations privilege management - operator privilege setting, password setting and change mechanism (lock, unlock, suspend, resume).

  • g. Branch systems: Web Page Design UI, its functions: Registration/Multi-Channel, teller sign-in, screen protection, transaction menu, favorite, supervisor authorization (self, remote authorization), different transaction forms handling.

  • h. Transaction history and history data retention.

(12) NETCenter

NETCenter is a network management software developed independently by SYSCOM COMPUTER. It helps network administrators to manage network devices such as Router, Switch, Server. Its main function modules include: Performance management module, event management module, provisioning management module, and configuration management module. The main development projects are as follows:

  • a. L2 topology map with "virtual object" function

  • b. L2 topology map with "group object" function

  • c. Instant Messenger warning (MSN)

  • d. Plug-in service monitoring tool

  • e. Syslog function consolidation

  • f. Automated traffic report delivery on a regular basis

  • g. TCP Service port monitor

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(13) GreenMaker

Energy saving and carbon reduction has been a common goal of governments in recent years, and is one of the government's policy objectives. Enterprises around the world have been actively using ICT to promote energy saving and carbon reduction solutions in recent years. SYSCOM COMPUTER has developed a power saving service platform with intelligent management mechanism to provide optimal power usage in buildings, factories, and shopping malls to help owners manage building power consumption.

(14) Payment Information System

The agencies under the county and city governments convert payment vouchers, transfer vouchers, balance transfer vouchers, expense recall documents, and check cancellation applications into electronic payment documents, and use the electronic operating system for review and send them to the finance bureau of the county and city governments through the telecommunication network for treasury payment or account processing operations. This operation includes the finance bureau, the appointed banks by municipal treasury and the payment agencies, and the payment of fees will be made in more convenient and secure manner through this system.

(15) Mobile Point of Sale

The birth of the smartphone has destined to change the financial industry. After six to seven years of alternation, banks of all sizes have confirmed the undeniable fact that banking services need to go mobile. The success of the initial move to APPS for banking inquiry services was like a shot in the arm for mobile banking, and helped acquirers take a big step toward mPOS and establish a mPOS business. The mPOS business is a revolution in the field of acquiring, which makes the consumer card spending process faster, easier and safer. Checkout no longer happens at the checkout counter; it's an instant checkout wherever consumers are. There are 3 main plans for the mPOS system we developed:

  • a. Provide a Bluetooth-connected card reader for accessing credit card information

  • b. Use mobile devices such as iOS and Android smartphones or tablets to enter the purchase amount and the cardholder's signature on the APP.

  • c. The mPOS system built by SYSCOM COMPUTER receives the purchase information, obtains the authorization result, and displays the final card spending result on the APP.

  • (16) Azure CSP Intelligent Cloud Management System

Provide the contract partners of Azure CSP (Cloud Smart Portal) with contract management and billing analysis through this system. Also provide value-added services to customers.

  • (17) Security Information Service Platform/Diamond Guard

The Executive Yuan promotes risk management as the core of information security protection to help solve the information security problems faced by various sectors in Taiwan. The current problems faced by a number of sectors are that they only have monitoring and control, but lack a joint prevention mechanism to deal with information security problems, without an automatic response notification, and integrated operation process. Therefore, Managed Detection Response (MDR) and Security Operations analytics platform architecture (SOAPA) have become the current trend of information security technology development.

Under the guidance of national security policy, the top and foremost goal is to have products independently developed in Taiwan. As there is no other product in Taiwan that meets the requirements, the product of this project will be the first and only one in the country when it is completed.

The objectives and expected benefits of the launch of this product, SISP, are:

  • a. Integrate the functions of traditional SOC (SIEM) and new generation SOC products

  • b. Establish information security awareness (dashboard) and security threat warning lights

  • c. Offer intelligent ISO management tools to help customers build information security PDCA standard operating process

  • d. Satisfy the needs of the three major operating mechanisms of customers: ISAC, SOC, and CERT

  • e. Assist large customers to build information-driven cross-organizational contingency and joint defense system

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  • (18) Cloud-Based Cross-Border Project Management Service

In response to the changing international business landscape and the pressure of managing employees from different countries and cultures, project development and order taking, as well as focusing on cost and efficiency, we plan to utilize Microsoft Cloud OS to build a cross-country Commercial Hybrid Cloud, using Microsoft Azure to eliminate the cost of purchasing large amounts of software and hardware. In addition, because Microsoft Azure adopts the system automation maintenance mode, it can solve the problem of subsequent hardware and software maintenance, and at the same time, it adopts Web Sites, Cloud Services and Cache solutions for cloud services respectively.

The innovation lies in the design of Cloud Services with a multi-tier architecture, which not only provides better load balancing mechanism and status monitoring, but also allows performance and connection monitors to configure services at any time according to different needs, such as expanding Web Role to increase the individual maximum load of network connection, or expanding Worker Role to increase the individual performance of instantaneous computation (when complex computation of large amounts of data is required), to enhance what cannot be done in a single-tier structure.

  • (19) Electricity Load Dispatching For Union Demand Response

Global electricity liberalization has become a trend, and the demand response system has been widely implemented abroad, with supporting measures in place for each phase of implementation. The demand response program can help the power industry to reduce the demand of peak loads, and has been effective in all countries. Taiwan is still facing the crisis of power shortage, and the demand response Aggregator business service model is an innovative energy solution that will drive demand from related industries.

The customer group demand response scheduling platform technology to be developed in this project is a web-based service technology platform between power companies and customers. The platform can manage the special load, characteristics and time periods of electricity consumption of many different customers. In addition, it can also calculate the different contract capacities of each customer and the accounting basis of customer power consumption on a regular and real-time basis, and predict the load consumption through historical data to determine the reliable unloading feedback from the customer's demand side to precisely achieve power dispatch.

(20) Continuous Configuration Platform (Opus One)

Network technology is generating more and more rapidly IT equipment management information is becoming more and more complex, that is, the table needs to update the automation analysis and management tools to integrate the current different nature and a large amount of information for comparison and analysis, and must be integrated into the concept of service management to provide “network application services” status intuitive information, so that managers directly understand whether the current service is normal to make immediate judgments to reduce the service barrier time.

The Opus One IP Continuous Configuration Management Platform is planned to integrate network management information such as network devices, system hosts, information security systems, events and flows, with rule analysis and process engine functions to set up Opus One monitoring work according to the administrator's management logic to perform automatic analysis functions similar to human intelligence. In addition to quickly providing abnormal information, asset and maintenance processing data, it is also planed to add automatic control functions such as automatically activating redundant equipment, turning on the network and notifying vendors so that “network application services” can quickly return to normal functions.

  • (21) Energy Diagnosis Management System

EDMS is a custom-oriented automatic monitoring and control management system, which is built under three main subsystems: a. Equipment system, b. Transmission system, and c. Monitoring and control management system. Through the transmission and linkage of the above three systems, we can achieve the customization requirements. According to the different transmission protocols used by the equipment, such as: lora, modbus, using the corresponding transmission system, you can achieve the subsequent automatic data transmission and analysis, system status monitoring, data analysis reports and other functions.

  • (22) Patrol box electronic

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Patrol box electronic uses the mobile carrier's camera to take a picture of QR code or scan NFC Tag automatically, and then displays QR code/NFC Tag details (including unit, patrol line, patrol box, address, latitude and longitude, and misalignment). After pressing OK to punch the card, the QR code/NFC Tag related information, the current GPS location of the carrier and the compressed photo will be uploaded to the back-end platform. The back-end management platform provides QR code/NFC for patrol box tagging, and the produced QR code/NFC is fully or partially encrypted, and the patrol points can be set by Google Map, and provides statistical analysis of related business data to produce reports, simplifying the existing paper patrol tags and achieving the goal of energy saving and paper reduction through comprehensive electronicization.

  • (23) Intelligent Analysis and Decision Support System

Given that most of the suspects have a tendency to repeat crimes, the crime scenarios between different cases and at different points in time are of mutual reference value. The database of people, vehicles, events, times, places, objects, and cases are added to the database of interpersonal relationships, criminal history, communication habits, and Internet behavior for cross-referencing.

  • a. The one-way vehicle transportation method often used by car theft syndicates is analyzed to keep track of suspicious vehicles, and the track reconstruction system is used to track vehicle tracks, trace the suspects' habitat, and take the initiative to attack.

  • b. It can be used to track down fraudulent withdrawal hotspots, and to track down possible accomplices in the vicinity of the call area with call records and other functions to get more information when police are working on a case.

  • c. Security spot analysis, security hot spot change analysis and regional information analysis and other crime mapping provide a flexible environment, convenient query conditions, so that investigators can obtain dynamic and static information to facilitate investigators to carry out advanced analysis.

(24) AYUDA

SYSCOM’s Ayuda robot is completely made in Taiwan (MIT), integrating robot parts, mobile platform (base), face recognition, human figure detection, voice recognition, voice conversation, video, self-learning map navigation, etc. It is the world's leading product of the same class in the market, and its functions are better than Pepper and Asus Zenbo. It can also be used in a variety of different situations such as smart police, smart medical, smart finance, and smart education.

The features of the cloud robot Ayuda Intelligent Platform are described as follows:

  • a. Mobile intelligent robot, can recognize people and proactively ask questions.

  • b. Intelligent robots can perform identity authentication.

  • c. Intelligent robots can perform voice recognition and simple voice response.

  • d. Intelligent robots can be connected to a dedicated service area by video.

  • e. Intelligent robot can automatically learn map and find locations.

Ayuda is mainly sold to the commercial market, including police, medical, finance, shopping malls, and education, and has been successfully sold to CIJ in Japan. We will further expand our close cooperation with our Japanese partners to enter the Japanese service-oriented robot market with SYSCOM's "Cloud Robot - Ayuda Intelligent Platform". The cloud robot Ayuda service robot is developed by SYSCOM COMPUTER, and will be extended to different applications such as enhancing face recognition or object recognition, conducting security patrol, enhancing artificial intelligent voice conversation, providing information inquiry, policy promotion, and other diversified services for the public.

(25) VIAMaster

The core value of "VIAMaster" technology is to develop artificial intelligence application for image recognition and rapid training, rapid deployment and real-time application solutions. Rapid cross-matching and analysis applications using image analysis technology to enhance public domain security. In the future, we can further integrate and cooperate with private security service providers, surveillance companies, and financial institutions to implement this solution for public safety and other smart security applications and when combined with the real-time analysis and identification of the images returned by the wearable camera, this solution can help reduce manpower and smarten security work. We will continue to add new applications such as industrial safety management, medical applications ......, etc.

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(26) SERVICE Online

The new version of the “SERVICE Online” is developed to meet the needs of information security issues and the mobile version of user forms. This development also includes the development of a flow module (SYSCOM Flow Engine) to replace the currently used outsourced flow engine (Agent Flow). Including:

  • a.SERVICE Online: In addition to providing the existing functions and optimizing the operation interface, it also addresses the information security issues. Use .Net MVC framework for modularized development, which can also reduce future maintenance costs, improve system maintainability, and provide sustainable services.

  • b. SASP mobile platform: Based on the current SASP platform, the SASP mobile platform is developed to facilitate engineers to create customer problem lists via mobile devices, assign problems and report progress, and improve the quality and speed of customer problem handling.

  • c. SYSCOM Flow Engine: In addition to satisfying the use of the new version of SERVICE Online, the SYSCOM Flow Engine will replace the flow engines used by other subsystems in the future to enhance the R&D capability of self-produced products.

(27) OMFLOW

OMFLOW is a software product developed by SYSCOM COMPUTER in response to the needs of digital integration applications. It is suitable for IT maintenance management, business form flow, system integration and interfacing, and various other individual or hybrid applications.

The social media version of OMFLOW provides users with unlimited access and open access to source code. The social media version does not have any restrictions on personal use. The following features are included:

  • a. Personal dashboard

  • b. Centralized task management

  • c. Process design engine

  • d. Python core engine

  • e. Social media process download

The enterprise version of OMFLOW has not only the social media process download, but also the official process developed by SYSCOM for users to download. In addition, the following enterprise features are available:

  • a. Decentralized computing

  • b. Data collection

  • c. Information Continuous Configuration Management

  • (28) Technical Service Management(TSM)

The software development projects undertaken by SYSCOM are managed through the selfdeveloped software project management platform-SDPM, which has been very effective in improving the quality of project management and has been recognized by the National Quality Award.

The development of this project will replicate the successful experience of the software project management platform to the technical service project management, project management of customer's equipment installation, maintenance and warranty, through project process management, contract execution management, progress tracking of various work forms, and related reminders/alerts sent to improve the quality of service to customers. Function modules:

  • a. Cost estimation and project authorization

  • b. Project planning and contract management

  • c. Project monitoring

  • d. Project cost analysis and forecast

  • e. Department capacity analysis and forecast

  • f. Project revenue analysis and forecast by department

  • g. Capacity profitability analysis by department

  • h. Compliance with current information security regulations Innovative features:

The latest international standard for information services, ISO20000:2018, and capacity utilization are incorporated into this system to create an innovative hardware/system information service management system that reduces costs, improves performance, and enables more efficient use of resources.

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  • (29) Hyper Automation Log Archiving Management System

The completeness of the logs kept in past information security incidents is important for the clarification of the truth and the remediation of the vulnerability after the incident, therefore, different requirements will be derived for the archiving, retention period management, and anti-corruption of the logs. The "Hyper Automation Log Archiving Management System" incorporates the entire archiving operation, including: archiving application, account management, log upload schedule setting, upload result notification, emergency upload, storage space management, etc. It is a centralized, cross-platform, highly automated, highly efficient, highly secure and highly It is a centralized, cross-platform, highly automated, high transfer efficiency, high security and high portability log archiving system.

(30) SECURITY USER INTERFACE PROGRAM

Based on the specifications of interbank transaction encryption and decryption, the standard security control API is developed to provide the application systems of all parties to use the encryption and decryption functions of HSM through a single interface. The HSM (Hardware Security Module) can also be customized to be compatible with existing application systems and different brands of HSM (Hardware Security Module), and provide source control mechanism (ACL) to meet the requirements of financial examination and internal audit of banks in Taiwan.

  • (31) Visa Direct,Mastercard Cross-border, Cross-border Payment Transaction management system

According to the Visa Direct and Mastercard Corss Border launched by the members of the international card organizations, the system is developed to facilitate the financial institutions' customers to use cell phones, Internet banking and other mobile devices to remit small amounts of money quickly to the designated accounts through the global network of card organizations with low handling fees.

  • (IV) Long-term and short-term business development plans

SYSCOM COMPUTER was established nearly 50 years ago, has always been engaged in the fields of professional computer services and targets trending applications such as digital transformation of enterprise and government systems, information security requirements, cloudification and huge data analysis. We will continue to focus on smart service robots, smart retail, smart medical, smart security and digital transformation to help customers create new service experiences with new business models and continue to seize opportunities to create new business opportunities.

The long-term and short-term business development plans are briefly described as follows:

  1. Short-term business development plan

  2. (1) Integrate various system management tools to continuously improve efficiency and quality.

  3. (2) Expand sales of core products and services to increase overall profitability.

  4. (3) Integrate 5G, AIoT, information security, big data and cloud technologies to develop a data economy.

  5. (4) Develop transportation, security and business applications with intelligent operating platforms.

  6. (5) Form alliances with outstanding domestic vendors to enter the emerging application market.

  7. Long-term business development plan

  8. (1) Implement the commitment of continuous improvement of total quality and strive for sustainable development of ESG.

  9. (2) Demonstrate strong system capabilities in software and hardware integration to help enterprises transform digitally.

  10. (3) Bridge advanced technology and application to life, and joining hands with Taiwan team to enter the World Cup.

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II. Market, production and sales overview:

(I) Market analysis

1.Major sales regions of products (services)

Unit: Thousands of NTD

Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD
Year
Sales volume
and value
Main products
2021		 2022

Domestic sales		 Export sales Domestic sales Export sales
Volume Value Volume Value Volume Value Volume Value
System Integration Service &
Computer/Peripheral Sales		 (Note) 4,395,276 (Note) 179,389 (Note) 4,432,803 (Note) 150,645
Computer & Peripheral
Maintenance		 〞 1,292,764
〞		 - 〞 1,349,167
〞		 -
Computer & Peripheral Lease 〞 2,166
〞		 - 〞 17,909
〞		 -
Total 〞 5,690,206
〞		 179,389
〞		 5,799,879
〞		 150,645

  • Note ： (1) The Company is in the information service industry and not in the manufacturing industry, so it is not applicable.

  • (2) The domestic sales region is primarily Taiwan, while the export sales are the revenues from overseas based on the Consolidated Company's operating locations, mainly in China, the United States and Southeast Asia.

2.Market share of main products:

According to the Statistics Division of the Ministry of Economic Affairs, the expansion of emerging applications such as 5G, high-performance computing, Internet of Things and cloud data processing, coupled with the opportunities for information security protection and digital transformation, has boosted the demand for information system services from enterprises to a full range of systems integration. The market size of computer and information service industry is expanding year by year. The 2022 operating revenue of my country's information service industry hit a record high, with an annual increase of 14.1%. SYSCOM COMPUTER is a software and services-based information company that provides software development and professional services, supplemented by software and hardware product distribution, to provide total solutions to meet the information needs of corporate customers, with industry know-how in finance and securities, telecommunications, medical institutions, government, police, education, and high-tech manufacturing industries... etc. It is one of the top 500 companies in Taiwan in 2022, and is ranked among the top three in the computer system integration service industry in the information service industry in Taiwan.

3.Future demand and supply in the market and growth potential:

  • (1) In order to effectuate information security governance and risk decisions for organizations and enterprises, self-assessment of information security maturity has become an important indicator. In August 2021, the Executive Yuan promulgated the amended provisions of the "Cyber Security Management Act", which explicitly require the deployment of "endpoint detection and response mechanism" and "cyber security vulnerability notification mechanism" by Level-A and Level-B government agencies. The FSC also released the "Financial Information Security Action Plan 2.0" on December 27, 2022. The FSC will implement this plan in phases over a three-year period to enhance information security, encourage financial institutions to adopt a zero-trust framework, expand the scope of information security monitoring mechanisms, pay attention to the preservation of core financial data, and promote support training for major information security incidents.

  • (2) The Ministry of Digital Affairs was established on August 27, 2022 to promote the development of the software industry and assist in the digital transformation of the industry; to develop forward-looking digital technology professions and talents in cross-disciplinary applications to foster international cooperation and exchange; to encourage the

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development of innovative digital applications with R&D subsidies and actively facilitate business transformation to explore business opportunities; and to guide enterprises to use data-driven and digital technology to strengthen their corporate constitution and enhance their international competitiveness in order to achieve the goal of promoting digital capability, industrial innovation and transformation, and digital economy development.

  • (3) The Executive Yuan's Forward-Looking Program is moving into its fourth stage (2023– 2024), the government will continue to invest in green energy, generation A semiconductor technology, IoT, AI, 5G, and information security as in the 5 Plus 2 Industrial Innovation Program and the Six Core Strategic Industries program. These involves public-private partnership, software and hardware consolidation to expand the momentum of digital transformation, early and forward-looking application deployment, formulation of regulations and system, open innovation network to foster cross-domain cooperation network, sandbox experiment to drive innovation, etc. In particular, we expect the future digital government shall promote the spirit of sandbox experimentation to encourage innovative development.

  • (4) Taiwan's cloud market has entered into a multi-cloud competitive stage, as the financial and medical industries have made great progress driven by the benchmark enterprises and the relaxation of regulations, accelerating the development of multi-cloud hybrid architecture. Both GCP and Microsoft Azure, two multinational public cloud providers, will complete virtual audits of their cloud services by 2021 in accordance with FSC regulations, with large financial leaders playing a key role in leading the way and driving more Taiwanese financial players to the cloud. In July 2022, the amendments to the electronic medical records related regulations were completed, and the use of cloud services for electronic medical records will be opened up, which is expected to accelerate the modernization of hospital IT transformation, reduce the burden of IT maintenance manpower, and give rise to more smart medical applications.

  • (5) According to a McKinsey report, smart health care will affect six major areas, including chronic disease management, self-management and disease prevention, disease diagnosis, diagnostic triage, clinical decision support and care services. According to the “2020 Healthcare Industry Outlook” by Deloitte and Touche, technology is driving innovation in the healthcare industry, especially disruptive trends such as big data and artificial intelligence, Internet of Things devices, medical data interoperability and decentralization of the healthcare field.

  • (6) With the rapid development of 5G communication and AIoT technology, it will bring innovative services at different levels for transportation applications. The use of innovative technology to enhance traffic and transportation safety and efficiency, create a friendly road environment, and achieve sustainable development of intelligent transportation are the important goals of governments in promoting intelligent transportation; and with the development of AI and Internet of Things, intelligent technology has created a variety of transportation applications, including data collection, data analysis, monitoring and control, monitoring and tracking, and audio-visual entertainment. Such a huge transportation infrastructure is a market opportunity that cannot be ignored by the industry.

4.Competitive advantages:

Since its establishment, SYSCOM COMPUTER has been dedicated to system integration. Through the introduction of various cutting-edge products and technologies, as well as excellent software development and integration capabilities, SYSCOM COMPUTER has helped customers in finance and securities, telecommunications, medical institutions, government and police, transportation, and high-tech manufacturing industries to undergo digital transformation. SYSCOM COMPUTER's insistence on customer service and professional execution quality is evident to all. SYSCOM COMPUTER is the only company in Taiwan that has twice passed the highest level of international software quality assessment, CMMI ML5, and has been selected as a CIO TAIWAN 2022 "Outstanding Service Provider". The Company has strong R&D capabilities, as well as hardware and software integration and project execution management capabilities, and is well recognized by customers. Our selfdeveloped products are used overseas for specific applications. Over the years, we have launched many well-received products, and in 2023, four products won the Taiwan Excellence Award: "Ayuda Intelligent Service Robot", "NETCenter Network Monitoring and Management Center", "DBMaker Database", "DBMaker Database System" and "OMFLOW Enterprise Process Engine". OMFLOW Enterprise Process Engine".

The management philosophy of SYSCOM COMPUTER is "Excellent people, satisfied

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customers, continuous growth and sustainable management", and "system integration" is the corporate value that the Company is proud of. With nearly 50 years of professional experience and services, SYSCOM has been able to grow the functional characteristics of enterprise information application systems together with customers' business needs through forwardlooking requirement planning, infinitely scalable software/hardware architecture, and professional and dedicated technical personnel. 。

  • 5.Favorable and unfavorable factors for development prospects and countermeasures:

  • (1) Favorable factors for development prospect

  • A. SYSCOM COMPUTER is the leading large-scale system integrator in Taiwan, and has been working on large-scale government application projects for a long time, with rich experience in planning and building large-scale forward-looking government information applications. With the customer's consent, we can copy the successful experiences to overseas markets to help the government expand Taiwan's international relations through E-business diplomacy.

  • B. SYSCOM COMPUTER is a distributor of software and hardware products from many domestic and foreign information companies, with rich technical certifications and support services that are well recognized by the partners we represent. SYSCOM COMPUTER provides a full range of IT products and value-added services, from IT infrastructure to application software information system planning, implementation and operation management, and is the best partner for enterprises' "digital transformation".

  • C. SYSCOM COMPUTER values talented people. We have more than 300 engineers with analysis and development capabilities in financial, medical, government, aerospace, telecommunications, and networking industries and a strong R&D capability, while our trademark and patent rights lead the domestic industry.

  • D. SYSCOM COMPUTER is a stable and financially sound company that provides services in the areas of finance and securities, telecommunications, medical institutions, government and police, transportation, high-tech manufacturing, and smart retail.... SYSCOM COMPUTER's customers are worldwide and most of them are leading companies in various industries, many of them have been working together for more than 20 to 30 years.

  • E. SYSCOM COMPUTER is committed to quality and has passed CMMI ML5, ISO9001, ISO9002, and ISO/IEC 20000-1:2018 in terms of quality program certification. We will continue to enrich our software and professional information service energy, accelerate the process of connecting with the international market with international-level software engineering quality assurance, and promote software market development and marketing cooperation.

  • F. SYSCOM COMPUTER passed “ISO27701 Privacy Information Management Certification”, becoming the first SI vendor in Taiwan to have four international standard certifications for privacy, information security, information services and personal data at the same time. Passed the dual certification of information services and information security: “ISO/IEC 27001:2013 (2020-2023)” and “CNS 27001:2014 (2021-2023)”. We passed the “BS 10012:2017 certification (2022-2025) for personal data security management, privacy information management "ISO/IEC 27701:2019 Certification (2022-2025)". Through the concrete action of obtaining the international standard certification, SYSCOM is able to express its determination to fully emphasize and protect the security of customers in the areas of "privacy information", "information security", "information service management" and "personal information management".

  • (2) Unfavorable factors for development prospects and countermeasures:

  • A. As technology continues to evolve, it is not easy to develop technological talents and retain technical experts;In addition, the information industry emphasizes hard skills over soft skills, and the magnetic effect of the semiconductor industry has caused an imbalance in the manpower market. In the fast-changing IT talent market, job openings for software engineers, data analysts, and information security experts are growing rapidly, highlighting the serious imbalance between supply and demand.

  • B. In addition, the current government procurement law does not have any special planning for innovative procurement, which makes it easy for vendors to compromise profitability due to price competition.

  • C. Taiwan's domestic market has limited industry scale, insufficient experience and expertise in developing a service economy, and a lack of cases of innovative applications and operating models and learning experiences.

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  • D. Disruptions in air, land and sea logistics due to the pandemic and the ongoing U.S.-China technology war will further accelerate global supply chain restructuring.

==> picture [21 x 11] intentionally omitted <==

Countermeasures ：

  • Strengthen the application and promotion of core products and services, deepen software research and development and application, and deepen self-research and development of products and expand related application services to increase the added value of projects.

  • Unite with the Taiwan team to participate in the World Cup. Replicate large-scale application system planning and construction experience to form a team and cooperate with Taiwanese companies in various fields to expand overseas markets.

  • Make good use of government resources and actively advise the government through the public association platform to facilitate the normal development of the industry.

  • The Company aims to develop talents with advanced information technology and develop a full range of professionals, increase opportunities for industry-academia cooperation between enterprises and academia, cultivate outstanding talents, provide professional internship opportunities, and transform research resources into industrial applications.

  • Invest in the development and application of our own R&D products, and to enhance the competitive advantage and added value of large-scale system projects through the mastery of core technologies, not only to provide better services to our customers, but also to increase customer loyalty.

  • Expand industrial information services and strengthen the research and development of core software technologies, increase and strengthen the content of IT products and services, increase the proportion of sales of our own products and services, expand and maintain contract customers, and increase contract rates.

  • Strengthen cooperation and communication with the partners we represent and agencies, and actively command the details of equipment supply and delivery.

(II) Important applications and production processes of main products:

  1. Important applications of main products:

SYSCOM COMPUTER has been playing the role of the locomotive of E-business in Taiwan for nearly 50 years. We provide professional and dedicated technical personnel and system integration, computer hardware, software and communication technology integration, as well as computer system planning, design, implementation and maintenance services with forwardlooking demand planning and full utilization of accumulated corporate knowledge resources. We provide consulting and overall information outsourcing services in the areas of finance and securities, telecommunications, medical institutions, government and police, transportation, electronic retail and high-tech manufacturing... etc.

During the production process, the company strictly follows CMMI-Dve v1.2 Maturity Level 5 software manufacturing process and applies its self-developed project management platform (SDPM, Software Development Process Master) to set standard operating procedures for the software design and development process, and through quantitative management of details, we can clearly understand In recent years, we have expanded to technical service project management, using the Technical Service Management (TSM) system to manage the installation, maintenance, and warranty of our customers' equipment to provide the most satisfactory quality and service.

  1. Production process: The Company is not a manufacturing company, so it is not applicable.

(III) Supply of main raw materials: The Company is not a manufacturing company, so it is not applicable.

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  • (IV) The names of suppliers and customers who accounted for more than 10% of the total purchases (sales) in any of the most recent 2 years

  • The names of customers who accounted for more than 10% of the total sales in any of the most recent 2 years, their sales amounts and percentages:

Unit: Thousands of NTD

Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD
Item 2021 2022 2023 up to the first quarter
Name Amount As a
percentage of
net sales for
the whole year
%
Relationship
with the
issuer
Name		 Amount As a
percentage of
net sales for
the whole year
%
Relationship
with the
issuer		 Name Amount As a percentage of net
sales for the current
year up to the previous
quarter %		 Relationship
with the
issuer
1 Customer A 568,324
9.68%		 None Customer A 536,647
9.02%
None		 Customer A 95,346
7.65%
None
2
Total 568,324 9.68% Total 536,647
9.02%
Total 95,346
7.65%
Net sales 5,869,595 100.00% Net sales 5,950,524
100.00%
Net sales 1,246,961
100.00%

Reasons for the change in sales to major customers:

There was no significant change in the overall sales to the Company's major customers in the most recent two years.

108

  1. The names of suppliers who accounted for more than 10% of the total purchases in any of the most recent 2 years, their purchase amounts and percentages:

Unit: Thousands of NTD

Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD
Item 2021 2022 2023 up to the first quarter
Name Amount As a percentage
of net purchases
for the whole
year %

Relationship
with the
issuer
Name		 Amount As a percentage
of net purchases
for the whole
year %		 Relationship
with the
issuer
Name		 Amount As a percentage of
net purchases for the
current year up to the
previous quarter%		 Relationship
with the
issuer
1 Cisco 245,539
10.13%		 None Zero One
Technology		 313,135
11.98%
None		 Metaage 105,259
16.15%
None
2 Metaage 284,485
10.88%
None		 Unicomp 88,084
13.51%
None
Total 245,539 10.13% Total
597,620
22.86%		 Total 193,343
29.66%
Net purchases 2,423,763 100.00% Net purchases
2,613,654
100.00%
Net purchases 651,830
100.00%

Reasons for the change in purchases from major suppliers:

There was no significant change in the overall purchases from the Company's major suppliers in the most recent two years.

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  • (V) Production volume and value for the most recent 2 years: The Company is in the information service industry and not in the manufacturing industry, so it is not applicable.

  • (VI) Sales volume and value for the most recent 2 years

Unit: Thousands of NTD

Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD
Year
Sales volume
and value
Main products
2021		 2022

Domestic sales		 Export sales Domestic sales Export sales
Volume Value Volume Value Volume Value Volume Value
System Integration
Service &
Computer/Peripheral
Sales		 (Note) 4,395,276 (Note) 179,389 (Note) 4,432,803 (Note) 150,645
Computer & Peripheral
Maintenance		 〞 1,292,764
〞		 - 〞 1,349,167
〞		 -
Computer & Peripheral
Lease		 〞 2,166
〞		 - 〞 17,909
〞		 -
Total 〞 5,690,206
〞		 179,389
〞		 5,799,879
〞		 150,645

  • Note: (1) The Company is in the information service industry and not in the manufacturing industry, so it is not applicable.

  • (2) The domestic sales region is primarily Taiwan, while the export sales are the revenues from overseas based on the Consolidated Company's operating locations, mainly in China, the United States and Southeast Asia.

III. Information on employees

rmation on employees rmation on employees
Year As of the end of
2021		 As of the end of
2022		 2023 up to April 15,
2023
Number of employees 1,158 1,187 1,206
Average age 40.3 40.72 41.04
Average years of service 8.94 9.13 9.29
As a
percentage of
education
distribution
Doctorate
Master
College (including
above)
Senior high school
(including below)		 0 0 0
239 242 253
901 928 937
18 17 16

IV. Information on environmental protection expenditures

The Company is mainly engaged in system integration services, and the sales process of products does not generate pollution, so the disclosure of environmental pollution problems or environmental protection expenditures is not applicable.

V. Labor relations

  • (I) The Company's employee welfare measures, training, education and retirement systems and their implementation, as well as the agreements between employees and management and measures to protect the rights and interests of employees:

  • Employee conduct and code of ethics

    • (1) In order to establish a good system and refine the organization and management, the Company has not only established the work rules for employees in accordance with the Labor Standards Act, but also established the "Code of Conduct for Anti-Corruption and Business Ethics and Activities" and measures for employee reward and punishment, so that all employees can have the ethical concepts and conduct standards to comply with, which are mainly as follows:

110 

  - Compliance with the Company’s regulations.

  - Those who are responsible for the Company's tangible and intangible assets should play the role of a good steward.

  - Do not leave the office, obstruct or interfere with the work of others during work hours.

  - No sexual harassment or assault of other employees.

  - Do not create rumors, spread rumors, or slander.

  - The Company has established a system for the delegation of duties and responsibilities, and authorizes the responsible leaders to exercise their decision-making authority, and they shall not act beyond their powers without authorization.

  - The work instructions or orders with deadlines from superiors must be completed on time, with the prescribed quality and quantity.

  - Do not intentionally conceal from or misrepresent anything to superiors.

  - Uphold the highest ethical standards for suppliers, contractors, customers, and others involved in the Company's business, and refrain from offering or accepting improper benefits.

  - Must not seek to gain an improper advantage or use the Company's name to deceive others externally.

  - Must not infringe on intellectual property rights, engage in unfair competition. Prevent using products or services to harm stakeholders, protect trade secrets, prohibit the disclosure of trade secrets, or prohibit insider trading.

  - The Accident Adjudication Committee is established to adjudicate liability for damages to the Company's rights caused by the negligence of an individual.

  - The Sexual Harassment Prevention Committee is responsible for receiving complaints and investigating cases of sexual harassment by employees.

  • (2) All rules and regulations of the Company are announced on the bulletin board. In case of reward or disciplinary actions, the Personnel Review Committee will be called on immediately to handle the reward and punishment.

  • Employee welfare measures and implementation

  • (1)The Company has established the Employee Welfare Committee, which is responsible for the welfare of all employees, and the welfare measures are supervised and executed by the Welfare Committee every year.

  • (2)The Company's welfare measures mainly include labor, health, group insurance, employee travel, birthday gifts, beer parties, year-end parties, welfare products, wedding and funeral subsidies, child birth subsidies, club activity subsidies, and health checkups. These measures are effective in boosting employees' morale.

  • (3)Various club activities are organized to provide employees with a balance between work and leisure.

  • (4)The Company provides group insurance for employees, their spouses and children. The coverage includes term life insurance, accidental injury insurance, hospitalization medical insurance, and cancer insurance.

  • Workplace diversity policy

  • (1) The Company is committed to providing an equal, inclusive, diverse and friendly workplace and safe working environment for its employees. Employees are hired, promoted and paid primarily based on their job category, academic experience, professional knowledge and skills, professional years of experience and individual performance to ensure that employees are not discriminated against, harassed or treated unequally based on race, gender, religious beliefs, age, political affiliation or other legally protected status.

  • (2)The company enforces diversity and equality in the workplace and provides equal promotion opportunities for male and female employees In 2022, the percentage of female employees was 31% and the percentage of female managerial officers was 22%.

  • Employee training and development

  • (1)In order to improve the quality of human resources and develop corporate strengths, the Company has established measures for education and training to maintain the foundation of our sustainable management and development. Each employee has an individual training record, which completely records the training process each employee has received.

  • (2)The Company provides complete professional development program for employees and encourages them to actively participate in various professional certifications. Therefore, both internal training and external training have a positive effect on their professional skills and

111

management skills.

A.Internal education and training include:

  • . New employee training: Provide new employees with training on corporate culture and related basic courses to help new employees shorten the adjustment period and cross the stage of exploration early.

  • . Functional training: The training mainly focuses on strengthening the professional and self-management skills of employees, covering new computer knowledge and applications, management practices and skills, etc., to meet the needs of different stages of growth.

  • . Leadership training: SYSCOM COMPUTER has a complete promotion system, and each reserve supervisor must pass a rigorous pre-service training program to qualify for promotion. In addition, on-the-job training is planned for existing supervisors to enrich their leadership skills in management and revitalize the operation of the organization.

  • B.External training:

External training courses are intended to enable employees to absorb new knowledge in the market and to keep abreast of global trends in order to enhance their professional skills in the workplace and to ensure service to customers. 

  - C.On-the-job training:

  - In order to improve the quality of employees, cultivate outstanding talents, and encourage employees to improve their professionalism, the company also provides employees with applications for on-the-job training.

  • (3)In 2022, the Company had 7,036 attendance in internal training and external training, and the cost of education and training was approximately NT$6.01 million.

  • Retirement system and implementation

  • (1)The Company's retirement system is governed by the Labor Standards Act and the Labor Pension Act.

  • (2)For employees subject to the old pension scheme under the Labor Standards Act, the Company makes monthly appropriates to the retirement reserve fund in accordance with the Labor Standards Act, which shall be overseen by the Supervisory Committee of Labor Retirement Reserve and deposited in the name of the Committee in the Bank of Taiwan, and the Committee is responsible for the receipt, payment, custody and utilization of the fund. For employees are subject to the new pension scheme under the Labor Pension Act, the Company is legally required to pay a monthly contribution of not less than 6% in accordance with the Labor Pension Act and to deposit to the employee's personal pension account established by the Bureau of Labor Insurance in accordance with the wage range table approved by the Executive Yuan.

  • Work environment and employee safety protection measures

  • (1)The Company has established "Environmental Management Regulations", "Code of Practice for Occupational Safety and Health" and "Safety Inspection Regulations" to enforce safety and health protection measures.

  • (2)In order to protect and maintain the safety of the office area, the Company has set up an access control system. All employees are required to wear identification cards when entering and leaving the building, and a surveillance system is in place to monitor and record 24 hours a day. Visitors are not allowed to enter the office area and must be received in the reception area. The main entrances and exits are guarded by security guards 24 hours a day to protect the personal safety of our employees.

  • (3)Employees will be briefed on the safety regulations by person in charge of each unit at the time of reporting for work.

  • (4)In order to effectuate the prevention and control of tobacco hazards, maintain the hygiene of the office environment and purify the air quality, and reject the health hazards caused by second-hand smoke. The Company's offices (areas), meeting rooms, stairwells, restrooms, dormitories and other indoor areas are all smoke-free except for the open balcony space and the legal smoking area.

  • (5)The office area is nice and in good condition, and an environmental officer is assigned to each office area and each floor to supervise the environmental cleanliness of the area.

  • (6)A complete fire safety system, including alarms, fire extinguishers, emergency lights, escape lights, escape doors, etc., is in place, and all equipment is inspected and replaced at least once

112

a year. 

  - (7)We cooperate with the fire department twice a year to conduct fire drills and escape route drills in the building.

  - (8)We conduct office carbon dioxide concentration monitoring and drinking water testing of water dispensers every six months.

  - (9)In response to the recent COVID-19 pandemic, in addition to strengthening the promotion of public health and cleaning and disinfection, employees and visitors are required to wear masks, take body temperature and disinfect their hands every day when they come to the company, and alcohol is placed at the entrance of each floor, antibacterial hand sanitizer is placed in the pantry, and alcohol/antibacterial hand sanitizer is placed in each meeting room for employees or visitors to use.

  - (10)A medical doctor is appointed to visit the company every two months to provide clinical services and professional nurses are employed to provide health services for workers.

  - (11)By organizing various club activities, employees can not only enhance their physical fitness and relieve physical fatigue, but also achieve a balance between work and leisure.

  - (12)Through regular annual employee health checkups and a variety of health seminars and health education information, employees can better grasp their health status and have the knowledge and methods of self-health management.

  - (13)We provide employees with term life insurance and accident insurance to increase their job protection.

  - (14)We provide a family-friendly workplace environment for employees by setting up a breastfeeding room.

  • (II) For the most recent year and for the current year up to the date of publication of the Annual Report, the amount of loss due to labor disputes and the estimated amount of current and potential future losses and countermeasures should be disclosed and if the amount cannot be reasonably estimated, the fact that it cannot be reasonably estimated shall be stated:

  • For the most recent year and for the current year up to the date of publication of the Annual Report, the amount of loss due to labor disputes: None

  • The estimated amount of current and potential future losses and countermeasures:

The Company follows the Labor Standards Act and related laws and regulations to protect labor rights and interests based on the trust of win-win cooperation between management and employees. The Company's management and employees have been co-working satisfactorily under the respect of labor-management ethics, and no significant labor disputes or losses have occurred so far, and no such losses are expected to occur in the future.

  1. Labor-management agreements already reached: None

  2. Labor-management agreements to be reached: None

  3. Measures for the protection of employee rights and interests:

The Company has held regular labor-management meetings in accordance with the regulations to maintain good labor relations and promote labor-management cooperation.

VI. Cyber security management

  • (I) Information security risk management framework

  • In order to strengthen and improve the information security of the Company and to implement the sustainable management of the Company, the Company has established the Information Security Committee is responsible for the decision making, management and promotion of information security matters. The Committee has a convener, co-convener, and vice convener, and the top management of each business group, center, and head office are appointed as members, and three sub-groups, including "information security policy," "information security promotion," and "risk management," are established to be responsible for information security policy formulation and promotion, information security management and promotion, and information security risk control and evaluation.

  • The Information Security Committee reports to the Board of Directors at least once a year on the status of information security implementation, and the status of implementation for 2022 was reported to the Board of Directors on December 15, 2022.

113

  • (II) Information security policy

  • The Company's information security management aims to provide a reliable and secure operating environment to ensure the normal operation of its continuous configuration business, and its information security policy is to "establish an information security culture, implement an information security system, strengthen information security protection, and reduce operational risks". In order to establish an information security environment with confidentiality, integrity, and availability. We make information security a natural aspect of employees' daily activities as a way to support the establishment of trust between all internal and external participants.

  • In order to implement the protection and management of personal data and to comply with the requirements of the Personal Data Protection Act, we have established the following:

    • (1) In accordance with the requirements of the “Personal Data Protection Act” and the “Enforcement Rules of the Personal Information Protection Act”, personal data is protected in the process of collection, processing, utilization, storage, transmission, and destruction.

    • (2) To protect the Company's business-related personal data from the risk of theft, alteration, destruction, loss, or leakage due to external threats or improper management and use by internal personnel.

    • (3) To enhance the protection and management of personal data, reduce operational risks, and create a reliable environment for the protection and privacy of personal data.

  • (III) Information security management system

We have introduced the information security management system (ISO 27001:2013), the personal data management system (BS 10012:2017), the information management system ISO 20000:2018, and the privacy information management system (ISO 27701) for information security management.

  1. Information security management system: in accordance with ISO 27001:2013 We introduced and obtained the certificate in 2016, and expanded the scope of certification in 2019 to include: Technology Center, R&D Center, Computer Center (CMPC), SDPM, and Information Security Control Center (SOC). In December 2019, we passed the third-party verification and obtained the certificate in February 2023 (valid from 2023/1/9-2025/12/31). The validity audit is conducted annually by a third party.

  2. Personal data management system: in accordance with standard BS 10012:2017 In 2012, we introduced a company-wide personal data management system (BS 10012) for the management and protection of personal data and passed the third-party certification, and in 2018, we obtained the third-party certification for the latest version of BS 10012:2017 (valid from 2022/1/20 to 2025/1/20). The validity audit is conducted annually by a third party.

  3. Information management system: in accordance with standard ISO 20000:2018 Our information management system has been implemented and validated to ISO 20000, and we have developed a good information service management process for demand management, change management, online management, incident management, problem management, capacity management, and availability management, etc. We implemented ISO 20000:2018 in 2019, passed third-party validation in December 2022, and obtained the certificate in February 2023 (valid from 2023/1/17-2026/1/17). The validity audit is conducted annually by a third party.

  4. Privacy information management system: in accordance with standard ISO 27701 In 2021, we introduced a privacy information management system (ISO 27701) for the management and protection of personal data and privacy, and obtained third-party certification in February 2023 (valid from 2023/1/9 to 2025/12/31). The validity audit is conducted annually by a third party.

(IV) Specific management plan

  • Continue to strengthen information security protection and establish joint defense mechanism, and various specific technical strengthening and management measures include:

  • Introduce new generation information security monitoring and joint prevention mechanism Conduct system function verification of its self-developed product "Security Information Service Platform/Diamond Guard" with the Company as the test field, including the introduction of terminal and network visibility tools and the establishment of an automated cooperation mechanism, and technical cooperation with the Cybersecurity Technology, Institute for Information Industry and information sharing platform vendors to conduct early warning information detection and joint prevention. in order to enhance the Company's overall information security.

  • Strengthen the efficiency and safety of employees’ Internet operations In addition to improving the overall bandwidth and performance of the Company's external and internal backbone networks, the company is also improving the efficiency and security of its

114

personnel through the construction of a dedicated "intranet and extranet" and the enhancement of information security protection equipment, in conjunction with the implementation of the Company's Great Intranet Project. 

  3. Enhance the security of the company's internal and external service websites In line with the Company's Great Intranet Project, we reviewed the current status of information security protection for internal and external web services, purchased additional web program firewalls, and reviewed the migration of the old system three months after the information security protection equipment was in place to ensure that all corporate services are properly protected.

  • (V) Annual information security risk status

  • Continue to maintain and refine ISO20000, ISO27001, ISO27701 and BS10012 information security management system. In 2022, there were 9 audits and 33 units were audited by the third-party. The validity audit was completed by the end of 2022.

  • Promote the implementation of the Great Intranet Project, and sequentially start the construction of the Company's external and backbone network upgrade, intranet and extranet implementation, and various information security protection enhancements.

  • Gradually introduce computer security configuration settings to GCB, and some departments have completed the initial introduction tests.

  • Strengthen the information security control of laptops for major projects, and cooperate with ITRI to introduce the network and program whitelist control mechanism to enhance the security of major projects.

  • Mandate the installation of terminal anti-virus systems, information security identification tools, and computer security configuration settings, along with network access control and information security protection monitoring, to strengthen the basic information security requirements of the company's intranet and extranet-connected devices. .

  • In September 2022, information security education and training courses were held for 1,169 employees, totaling 4,091 person-hours, to strengthen employees' information security attitudes, values, regulations, and practices, to make information security a natural part of employees' daily activities, and to build trust between internal and external participants.

VII. Important contracts

Nature Parties involved Contract start and end
date		 Main contents Material
restriction clauses
Distribution
contracts		 Cisco Since 2003.10.27 Licensing SYSCOM as Cisco Gold Partner None
Distribution
contracts		 Hewlett Packard
Enterprise		 Since 2011.01.14 Licensing SYSCOM as HP Enterprise
Platinum Distributor		 None
Distribution
contracts		 CyberLink Corp. 2019.07.01~ 2024.06.30 Licensing SYSCOM as CyberLink
Distributor		 None
Distribution
contracts		 Microsoft Since 2017.12.27 Licensing SYSCOM as Microsoft LSP/CSP
Distributor		 None

115

Six. Financial position

  • I. Condensed Balance Sheets and Statements of Comprehensive Income for the most recent 5 years

( I ) Condensed Balance Sheet

  1. Consolidated Condensed Balance Sheet–Based on IFRS
1. Consolidated Condensed Balance Sheet–Based on IFRS 1. Consolidated Condensed Balance Sheet–Based on IFRS 1. Consolidated Condensed Balance Sheet–Based on IFRS 1. Consolidated Condensed Balance Sheet–Based on IFRS 1. Consolidated Condensed Balance Sheet–Based on IFRS 1. Consolidated Condensed Balance Sheet–Based on IFRS 1. Consolidated Condensed Balance Sheet–Based on IFRS 1. Consolidated Condensed Balance Sheet–Based on IFRS
Unit: Thousands of NTD
Year
Item
Financial Summary for The Last Five Years		 As of March 31,
2023（Note 1）
2018 2019 2020 2021 2022
Current assets 2,549,289
3,433,397
3,554,576
3,502,741
3,764,749
3,415,870
Property, Plant and
Equipment		 452,249
407,341
362,489
370,818
357,328
350,361
Intangible assets 20,635
20,489
3,656
2,743
2,410
2,832
Other assets 316,485
456,962
369,145
358,027
310,453
414,864
Total assets 3,338,658
4,318,189
4,289,866
4,234,329
4,434,940
4,183,927
Current
liabilities		 Before
distribution		 1,434,932
2,277,355
2,215,942
2,136,747
2,284,257
1,891,327
After
distribution		 1,484,932
2,377,355
2,365,942
2,326,747		 （Note 2） （Note 2）
Non-current liabilities 147,341
225,952
179,220
122,825
98,870
152,475
Total
liabilities		 Before
distribution		 1,582,273
2,503,307
2,395,162
2,259,572
2,380,127
2,043,802
After
distribution		 1,632,273
2,603,307
2,545,162
2,449,572		 （Note 2） （Note 2）
Equity attributable to
shareholders of the
parent		 1,732,653
1,797,504
1,882,901
1,964,116
2,049,845
2,135,795
Capital stock 1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
Capital surplus 10
1,130
1,521
1,547
1,547
1,426
Retained
earnings		 Before
distribution		 743,312
811,036
898,606
969,490
1,044,551
1,128,982
After
distribution		 693,312
711,036
748,606
779,490		 （Note 2） （Note 2）
Other equity interest (10,669)
(14,662)
(17,226)
(6,921)
3,747
5,387
Treasury stock - - - - - -
Non-controlling
interest		 23,732
17,378
11,803
10,641
4,968
4,330
Total
equity		 Before
distribution		 1,756,385
1,814,882
1,894,704
1,974,757
2,054,813
2,140,125
After
distribution		 1,706,385
1,714,882
1,744,704
1,784,757		 （Note 2） （Note 2）

Note 1 ： Financial data in 2023 Q1 has been reviewed by the CPA.

Note 2 ： As of April 15, 2023, the earning distribution of 2022 was not approved by annual Shareholders’ Meeting.

116

2.Parent Condensed Balance Sheet–Based on IFRS

Unit: Thousands of TND Unit: Thousands of TND Unit: Thousands of TND Unit: Thousands of TND Unit: Thousands of TND Unit: Thousands of TND Unit: Thousands of TND
Year
Item
Financial Summary for The Last Five Years
2018 2019 2020 2021 2022
Current assets 2,090,035
2,898,081
3,211,798
3,153,985
3,426,661
Property, Plant and
Equipment		 419,519
376,412
333,917
343,436
328,345
Intangible assets 8,092
8,812
957
592
492
Other asset 590,149
670,066
547,488
526,092
489,557
Total assets 3,107,795
3,953,371
4,094,160
4,024,105
4,245,055
Current
liabilities		 Before
distribution		 1,229,405
1,940,914
2,038,238
1,924,679
2,040,140
After
distribution		 1,279,405
2,040,914
2,188,238
2,114,679
(Note 1)
Non-current liabilities 145,737
214,953
173,021
135,310
155,070
Total
liabilities		 Before
distribution		 1,375,142
2,155,867
2,211,259
2,059,989
2,195,210
After
distribution		 1,425,142
2,255,867
2,361,259
2,249,989
(Note 1)
Capital stock 1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
Capital surplus 10
1,130
1,521
1,547
1,547
Retained
earnings		 Before
distribution		 743,312
811,036
898,606
969,490
1,044,551
After
distribution		 693,312
711,036
748,606
779,490
(Note 1)
Other equity interest (10,669)
(14,662)
(17,226)
(6,921)
3,747
Treasury stock - - - - -
Total
equity		 Before
distribution		 1,732,653
1,797,504
1,882,901
1,964,116
2,049,845
After
distribution		 1,682,653
1,697,504
1,732,901
1,774,116
(Note 1)

Note 1 ： As of April 15, 2023, the earning distribution of 2022 was not approved by annual Shareholders’ Meeting.

117

(II)Condensed Statement of Comprehensive Income

  1. Consolidated Condensed Statement of Comprehensive Income – Based on IFRS
Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD
Year
Item
Financial Summary for The Last Five Years		 As of March
31, 2023
（Note 1）
2018 2019 2020 2021 2022
Operating revenue 4,726,730
5,910,857
5,757,866
5,869,595
5,950,524
1,246,921
Gross profit 1,110,131
1,244,168
1,310,988
1,424,263
1,518,500
333,669
Income from operations 36,591
100,240
163,353
254,826
264,405
102,747
Non-operating income
and expenses		 44,662
50,496
49,545
17,031
40,251
4,284
Income before tax 81,253
150,736
212,898
271,857
304,656
107,031
Income from operations
of continued segments
(after tax)		 60,231
124,937
166,842
214,977
244,945
83,991
Income from
discontinued operations		 - - - - - -
Net income (Loss) 60,231
124,937
166,842
214,977
244,945
83,991
Other comprehensive
income (after tax)		 2,664
(8,314)
15,030
15,297
25,146
1,631
Total comprehensive
income		 62,895
116,623
181,872
230,274
270,091
85,622
Net income attributable
to shareholders of the
parent		 62,912
129,150
169,958
215,822
250,730
84,431
Net income attributable
to non- controlling
interest		 (2,681)
(4,213)
(3,116)
(845)
(5,785)
(440)
Comprehensive income
attributable to
Shareholders of the
paren		 66,106
121,125
185,006
231,189
275,729
86,071
Comprehensive income
attributable to non-
controlling interest		 (3,211)
(4,502)
(3,134)
(915)
(5,638)
(449)
Earnings per
share(NT$)		 0.63
1.29
1.70
2.16
2.51
0.84

Note 1 ： Financial data in 2023 Q1 has been reviewed by the CPA.

118

2.Parent Condensed Statement of Comprehensive Income – Based on IFRS

Unit: Thousands of NTD

Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD Unit: Thousands of NTD
Year
Item
Financial Summary for The Last Five Years
2018 2019 2020 2021 2022
Operating revenue 4,385,609
5,411,715		 5,481,240
5,578,076
5,674,679
Gross profit 1,001,628
1,112,588		 1,223,666
1,320,916
1,417,403
Income from operations 97,105
134,584		 212,777
283,481
291,698
Non-operating income
and expenses		 (13,158)
22,447		 2,316
(11,302)
17,954
Income before tax 83,947
157,031		 215,093
272,179
309,652
Income from operations
of continued segments
(after tax)		 62,912
129,150		 169,958
215,822
250,730
Income from
discontinued operations		 - - - - -
Net income (Loss) 62,912
129,150		 169,958
215,822
250,730
Other comprehensive
income (after tax)		 3,194
(8,025)		 15,048
15,367
24,999
Total comprehensive
income		 66,106
121,125		 185,006
231,189
275,729
Net income attributable
to shareholders of the
parent		 62,912
129,150		 169,958
215,822
250,730
Net income attributable
to non- controlling
interest		 - - - - -
Comprehensive income
attributable to
Shareholders of the
parent		 66,106
121,125		 185,006
231,189
275,729
Comprehensive income
attributable to
noncontrolling interest		 - - - - -
Earnings per share (NT$)
0.63
1.29		 1.70
2.16
2.51
  • (III)Auditors’ Opinions in the last five years
Year Accounting Firm CPA Audit Opinion
2018 Deloitte & Touche Hsin-Wei Tai
Li-Wen Kuo		 An unmodified opinion with emphasis of other
matter paragraph
2019 Deloitte & Touche Hsin-Wei Tai
Li-Wen Kuo		 An unmodified opinion with emphasis of other
matter paragraph
2020 Deloitte & Touche Hsin-Wei Tai
Pei-De Chen		 An unmodified opinion with emphasis of other
matter paragraph
2021 Deloitte & Touche Hsin-Wei Tai
Pei-De Chen		 An unmodified opinion with emphasis of other
matter paragraph
2022 Deloitte & Touche Hsin-Wei Tai
Pei-De Chen		 An unmodified opinion with emphasis of other
matter paragraph

119

II. Financial analysis for the most recent 5 years

(I)Consolidated Financial Analysis–Based (I)Consolidated Financial Analysis–Based (I)Consolidated Financial Analysis–Based on IFRS on IFRS on IFRS on IFRS on IFRS on IFRS
Item Year Financial Analysis for the Last Five Years As of March
31, 2023
(Note 1)
2018 2019 2020 2021 2022
Financial
structure (%)		 Debt Ratio 47.39 57.97 55.83 53.36 53.67 48.85
Ratio of long-term capital to property,
plant and equipment		 420.95 510.01 572.13 565.66 601.88 654.35
Solvency (%) Current ratio 177.66 150.76 160.41 163.93 164.81 180.61
Quick ratio 138.24 120.26 122.06 136.41 128.17 128.88
Interest earned ratio (times) 12.22 10.99 24.20 56.71 39.93 28.84
Operating
performance		 Accounts receivable turnover (times) 4.06 5.51 4.84 4.32 3.87 4.31
Average collection period 89.90 66.24 75.41 84.49 94.31 84.69
Inventory turnover (times) 9.43 11.31 8.71 10.22 11.71 7.18
Accounts payable turnover (times) 3.73 4.15 3.13 3.13 3.24 2.75
Average days in sales 38.70 32.27 41.90 35.71 31.16 50.84
Property, plant and equipment turnover
(times)		 10.45 14.51 15.88 15.83 16.65 3.56
Total asset turnover (times) 1.42 1.37 1.34 1.39 1.34 0.30
Profitability Return on total assets (%) 1.90 3.58 4.05 5.14 5.80 2.02
Return on stockholders'equity (%) 3.43 7.00 9.00 11.11 12.16 4.00
to paid-in
capital (%)		 Operating income 3.66 10.02 16.34 25.48 26.44 10.27
Pre-tax income 8.13 15.07 21.29 27.19 30.47 10.70
Profit ratio (%) 1.27 2.11 2.90 3.66 4.12 6.74
Earnings per share (NT$) 0.63 1.29 1.70 2.16 2.51 0.84
Cash flow Cash flow ratio (%) 19.61 (3.91) 24.99 8.98 9.28 12.71
Cash flow adequacy ratio (%) 122.84 100.34 103.74 121.40 104.88 -
Cash reinvestment ratio (%) 10.02 (6.54) 20.72 1.88 0.94 10.01
Leverage Operating leverage - - - - - -
Financial leverage - - - - - -
Analysis of financial ratio differences for the last two years：not applicable.

Note 1: The financial ratios for 2023 Q1 were calculated based on the financial data has been reviewed by the CPA. Note 2: The calculation formula goes as follows.

  1. Financial Structure

(1) Debt Ratio = total liabilities / total assets

(2) Ratio of long-term capital to property, plant and equipment = (total equity + non-current liabilities) / net worth of property, plant and equipment

  1. Solvency

  2. (1) Current ratio = current assets / current liabilities

(2) Quick ratio = (current assets – inventory – prepaid expenses) / current liabilities

(3) Interest coverage ratio = income before income tax and interest expenses / current interest expenses

  1. Operating ability

(1) Receivables (including accounts receivable and notes receivable arising from business operations) turnover rate = net sales / average receivables (including accounts receivable and notes receivable arising from business operations) for each period

(2) Average collection days for receivables = 365 / receivables turnover rate

(3) Inventory turnover rate = cost of sales / average inventory

(4) Payables (including accounts payable and notes payable arising from business operations) turnover rate = cost of sale

/ average payables (including accounts payable and notes payable arising from business operations) for each period

(5) Average days of sale = 365 / inventory turnover rate

(6) Property, plant and equipment turnover rate = net sales / average net worth of property, plant and equipment

(7) Total asset turnover rate = net sales /average total asset

  1. Profitability

(1) Return on assets = [net income + interest expenses (1- tax rate)] / average total assets

(2) Return on equity = net income / average total equity

  • (3) Profit margin before tax = net income / net sales

120

  • (4) Earnings per share = (profit and loss attributable to owners of the parent – dividends on preferred shares) / weighted average number of issued shares

  • Cash flow

  • (1) Cash flow ratio = Net cash flow from operating activities / current liabilities

  • (2) Net cash flow adequacy ratio = Net cash flow from operating activities for the most recent five years / (capital expenditures + inventory increase + cash dividend)

  • (3) Cash flow reinvestment ratio = (Net cash flow from operating activities – cash dividend) / gross property, plant and equipment value + long-term investment + other non-current asset+ working capital)

  • Leveraging:

  • (1) Operating leverage = (net operating revenue – variable operating costs and expenses) / operating income

  • －

  • (2) Financial leverage = operating income / (operating income interest expenses)

121

(II)Parent Financial Analysis–Based on IFRS

Fiscal Year
Items for Analysis		 Fiscal Year
Items for Analysis		 Fiscal Year
Items for Analysis		 Financial Analysis for the Last Five Years Financial Analysis for the Last Five Years Financial Analysis for the Last Five Years Financial Analysis for the Last Five Years
2018 2019 2020 2021 2022
Financial
structure (%)		 Debt Ratio 44.25 54.53 54.01 51.19 51.71
Ratio of long-term capital to
property, plant and equipment		 447.75 534.64 615.70 611.30 671.52
Solvency
(%)		 Current ratio 170.00 149.32 157.58 163.87 167.96
Quick ratio 127.87 115.64 117.10 134.96 128.88
Interest earned ratio (times) 46.6 32.2 57.6 176.7 990.3
Operating
performance		 Accounts receivable turnover
(times)		 4.17 5.54 5.07 4.42 3.94
Average collection period 87.52 65.88 71.99 82.57 92.63
Inventory turnover (times) 9.59 11.41 8.81 10.37 12.27
Accounts payable turnover (times) 3.58 3.97 3.07 3.04 3.15
Average days in sales 38.06 31.98 41.43 35.19 29.74
Property, plant and equipment
turnover (times)		 10.45 14.38 16.41 16.24 17.28
Total asset turnover (times) 1.41 1.37 1.34 1.39 1.34
Profitability Return on total assets (%) 1.97 3.77 4.30 5.35 6.07
Return on stockholders'equity (%) 3.62 7.32 9.24 11.22 12.49
to paid-in
capital (%)		 Operating income 9.71 13.46 21.28 28.35 29.17
Pre-tax income 8.39 15.70 21.51 27.22 30.97
Profit ratio (%) 1.43 2.39 3.10 3.87 4.42
Earnings per share (NT$) 0.63 1.29 1.70 2.16 2.51
Cash flow Cash flow ratio (%) 25.95 (1.72) 26.27 11.23 11.21
Cash flow adequacy ratio (%) 128.69 100.36 95.85 119.07 103.94
Cash reinvestment ratio (%) 12.10 (4.00) 20.27 3.00 1.63
Leverage Operating leverage - - - - -
Financial leverage - - - - -

Note1: The calculation formula goes as follows.

  1. Financial Structure

(1) Debt Ratio = total liabilities / total assets

(2) Ratio of long-term capital to property, plant and equipment = (total equity + non-current liabilities) / net worth of property, plant and equipment

  1. Solvency

(1) Current ratio = current assets / current liabilities

(2) Quick ratio = (current assets – inventory – prepaid expenses) / current liabilities

(3) Interest coverage ratio = income before income tax and interest expenses / current interest expenses

3.Operating ability

(1) Receivables (including accounts receivable and notes receivable arising from business operations) turnover rate = net sales / average receivables (including accounts receivable and notes receivable arising from business operations) for each period

(2) Average collection days for receivables = 365 / receivables turnover rate

(3) Inventory turnover rate = cost of sales / average inventory

(4) Payables (including accounts payable and notes payable arising from business operations) turnover rate = cost of sale / average payables (including accounts payable and notes payable arising from business operations) for each period

(5) Average days of sale = 365 / inventory turnover rate

(6) Property, plant and equipment turnover rate = net sales / average net worth of property, plant and equipment

(7) Total asset turnover rate = net sales /average total asset

  1. Profitability

(1) Return on assets = [net income + interest expenses (1- tax rate)] / average total assets

(2) Return on equity = net income / average total equity

(3) Profit margin before tax = net income / net sales

(4) Earnings per share = (profit and loss attributable to owners of the parent – dividends on preferred shares) / weighted

122

average number of issued shares

  1. Cash flow

  2. (1) Cash flow ratio = Net cash flow from operating activities / current liabilities

  3. (2) Net cash flow adequacy ratio = Net cash flow from operating activities for the most recent five years / (capital expenditures + inventory increase + cash dividend)

  4. (3) Cash flow reinvestment ratio = (Net cash flow from operating activities – cash dividend) / gross property, plant and equipment value + long-term investment + other non-current asset+ working capital)

  5. Leveraging:

  6. (1) Operating leverage = (net operating revenue – variable operating costs and expenses) / operating income

  7. －

  8. (2) Financial leverage = operating income / (operating income interest expenses)

123

III. Audit Committee’s review reports on the financial statements for the most recent year

SYSCOM COMPUTER ENGINEERING CO.

Audit Committee’s Review Report

The Company’s Board of Directors prepared the 2022 Business Report, Financial Statements, and Statement of Earnings Distribution, among which the Financial Statements were audited by CPAs at Deloitte & Touche, by whom an audit report has been issued. Said Business Report, Financial Statements, and Statement of Earnings Distribution have been reviewed by the Audit Committee, and no inconsistency was found. The report is hereby presented as above in accordance with the relevant provisions of the Securities and Exchange Act and the Company Act. Please proceed to review it.

This report is hereby presented to

2023 Annual Shareholders’ Meeting of Syscom Computer Engineering Co.

Audit Committee Convener: Che-Fu Kung

March 17, 2023

124

IV. Financial statements for the most recent year

DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

The entities that are 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, 2022 are all the same as those included in the consolidated financial statements prepared in conformity with the International Financial Reporting Standard 10, “Consolidated Financial Statements.” In addition, the information required to be disclosed in the consolidated financial statements is included in the consolidated financial statements. Consequently, Syscom Computer Engineering Co. and its subsidiaries do not prepare a separate set of consolidated financial statements of affiliates.

Very truly yours,

SYSCOM COMPUTER ENGINEERING CO.

By

Jui-Fu Liu Chairman

March 17, 2023

125

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Syscom Computer Engineering Company

Opinion

We have audited the accompanying consolidated balance sheets of Syscom Computer Engineering Company (the “Corporation”) and its subsidiaries (collectively, the “Group”) for the years ended December 31, 2022 and 2021 and the relevant consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and relevant notes, including a summary of significant accounting policies (collectively referred to as the “consolidated financial statements”).

In our opinion, based on our audits and the reports of other auditors (refer to Other Matter section), the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2022 and 2021, and its consolidated financial performance and consolidated cash flows for the years then ended in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively referred to as “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC) of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Group’s consolidated financial statements for the year ended December 31, 2022. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matters of the financial statements of the Group for the year ended December 31, 2022 are stated as follows:

Recognition of Contract Revenue

The Group generates revenue through rendering of services according to contract. Revenue from contract is recognized by reference to the stage of completion of contract activity. The stage of completion of the contract is measured based on the proportion of contract cost incurred for work performed to date relative to the estimated total contract cost. The management estimates total contract cost upon signing of the contract. However, the estimated total cost may change as the contract activity progresses and such change may have material impact on revenue recognition; therefore, the recognition of contract revenue is deemed to be a key audit matter.

126

We focused on the measurement of stage of completion while testing the recognition of contract revenue. The procedures we performed are the following:

  1. We examined the underlying documents of original contract and related addendum used as basis for contract revenue recognized.

  2. We verified the accuracy of accumulated incurred cost through test of details.

  3. We assessed the appropriateness of underlying information and assumptions the management used in estimating total cost.

  4. We performed retrospective review of discrepancy between actual costs incurred and estimated total cost of completed contract.

Please refer to Notes 4 and 5 to the financial statements for related disclosure on revenue recognition.

Other Matters

In the Group’s consolidated financial statements, the financial statements of subsidiaries that are not material are audited by other auditors. Therefore, in our opinion on the consolidated financial statements as mentioned above, the amounts shown in such subsidiaries’ financial statements are recognized based on the audit reports prepared by other auditors. The total assets of the above subsidiaries as of December 31, 2022 and 2021 were NT$282,734 thousands and NT$259,291 thousands, respectively, both accounting for 6% of the total consolidated assets; the net operating revenue for the years ended December 31, 2022 and 2021 was NT$152,396 thousands and NT$124,360 thousands, which represented 3% and 2% of the net consolidated operating revenue.

The Corporation has prepared the financial statements for the years ended December 31, 2022 and 2021, and we have issued an auditor’s report on said statements with the unqualified opinion and other matters paragraphs for reference.

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

The responsibilities of the management are to prepare the financial statements with fair presentation in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the regulations of IFRS and IAS as well as IFRIC and SIC interpretations endorsed and issued into effect by the FSC and to maintain necessary internal control associated with the preparation in order to ensure that the financial statements are free from material misstatement arising from 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.

The Group’s governing body (including the Audit Committee) is responsible for supervising the 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. Misstatement may arise from frauds or errors. If the amounts of misstatements, either separately

127

or in aggregate, could reasonably be expected to influence the economic decisions of the users of the consolidated financial statements, they are considered material.

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

  2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

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

  4. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the 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.

  5. 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.

  6. Obtain sufficient appropriate audit evidence regarding the financial information of the 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 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 statements 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 Group’s consolidated financial statements for the year ended December 31, 2022, and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Hsin-Wei Tai and Pei-De Chen.

128

Deloitte & Touche Taipei, Taiwan Republic of China March 17, 2023

Notice to Readers

The accompanying financial statements are intended only to present the 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 financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. 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 financial statements shall prevail.

129

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2022 AND 2021

Code

1100
1110
1136
1140
1150
1172
1200
1220
130X
1410
1479
11XX

1517
1535
1550
1600
1755
1821
1840
1990
15XX
1XXX

Code

2100
2130
2150
2170
2200
2230
2280
2399
21XX

2572
2580
2640
2645
25XX
2XXX

3110
3200
3310
3320
3350
3300
3400
31XX
36XX

3XXX
 ASSETS
CURRENT ASSETS
Cash and cash equivalents (Notes 4 and 6)
Financial assets at fair value through profit or loss - current (Notes 4 and
7)
Financial assets at amortized cost - current (Notes 4, 9 and 28)
Contract assets - current (Notes 4 and 21)
Notes receivable (Note 4)
Accounts receivable (Notes 4, 10, and 27)
Other receivables (Note 4)
Current tax assets
Inventories (Notes 4 and 11)
Prepayments
Other current assets
Total current assets
NON-CURRENT ASSETS
Financial assets at fair value through other comprehensive income - non-
current (Notes 4 and 8)
Financial assets at amortized cost - non-current (Notes 4, 9, and 28)
Investments accounted for using the equity method (Notes 4 and 13)
Property, plant and equipment (Notes 4, 14, 27, and 28)
Right-of-use assets (Notes 4 and 15)
Intangible assets (Notes 4 and 16)
Deferred tax assets (Notes 4 and 23)
Other non-current assets (Note 4)
Total non-current assets
TOTAL
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Notes 17 and 28)
Contract liabilities - current (Notes 4 and 21)
Notes payable
Accounts payable (Note 27)
Other payables (Note 18)
Current tax liabilities
Lease liabilities - current (Notes 4, 15, and 27)
Other current liabilities
Total current liabilities
NON-CURRENT LIABILITIES
Deferred tax liabilities (Notes 4 and 23)
Lease liabilities - non-current (Notes 4, 15, and 27)
Net defined benefits liabilities - non-current (Notes 4 and 19)
Guarantee deposits received
Total non-current liabilities
Total liabilities
EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Notes
4 and 20)
Share capital - ordinary shares
Capital surplus
Retained earnings
Legal reserve
Special reserve
Unappropriated earnings
Total retained earnings
Other equity
Total equity of the owners of the Corporation
Non-controlling interests (Note 20)
Total equity
TOTAL		 December 31, 2022 December 31, 2022 (In Thousands of New Taiwan

December 31, 2021
％
Amount
13
$ 468,100
-
235,009
5
185,440
11
359,158
-
3,040
34
1,576,836
-
9,681
-
248
10
292,605
9
295,396
3

77,228

85

3,502,741

1
22,448
3
147,170
2
64,914
8
370,818
-
63,508
-
2,743
-
19,204
1

40,783

15

731,588

100
$ 4,234,329

4
$ 137,726
6
208,240
-
68
32
1,318,607
9
376,623
1
33,265
-
45,720
-

16,498

52

2,136,747

-
11,238
-
20,362
1
77,495
1

13,730

2

122,825

54

2,259,572

22

1,000,000

-

1,547

7
281,889
1
17,619
16

669,982

24

969,490

-
(
6,921)

46
1,964,116
-

10,641

46

1,974,757

100
$ 4,234,329
 (In Thousands of New Taiwan

December 31, 2021
％
Amount
13
$ 468,100
-
235,009
5
185,440
11
359,158
-
3,040
34
1,576,836
-
9,681
-
248
10
292,605
9
295,396
3

77,228

85

3,502,741

1
22,448
3
147,170
2
64,914
8
370,818
-
63,508
-
2,743
-
19,204
1

40,783

15

731,588

100
$ 4,234,329

4
$ 137,726
6
208,240
-
68
32
1,318,607
9
376,623
1
33,265
-
45,720
-

16,498

52

2,136,747

-
11,238
-
20,362
1
77,495
1

13,730

2

122,825

54

2,259,572

22

1,000,000

-

1,547

7
281,889
1
17,619
16

669,982

24

969,490

-
(
6,921)

46
1,964,116
-

10,641

46

1,974,757

100
$ 4,234,329
 (In Thousands of New Taiwan

December 31, 2021
％
Amount
13
$ 468,100
-
235,009
5
185,440
11
359,158
-
3,040
34
1,576,836
-
9,681
-
248
10
292,605
9
295,396
3

77,228

85

3,502,741

1
22,448
3
147,170
2
64,914
8
370,818
-
63,508
-
2,743
-
19,204
1

40,783

15

731,588

100
$ 4,234,329

4
$ 137,726
6
208,240
-
68
32
1,318,607
9
376,623
1
33,265
-
45,720
-

16,498

52

2,136,747

-
11,238
-
20,362
1
77,495
1

13,730

2

122,825

54

2,259,572

22

1,000,000

-

1,547

7
281,889
1
17,619
16

669,982

24

969,490

-
(
6,921)

46
1,964,116
-

10,641

46

1,974,757

100
$ 4,234,329
 (In Thousands of New Taiwan

December 31, 2021
％
Amount
13
$ 468,100
-
235,009
5
185,440
11
359,158
-
3,040
34
1,576,836
-
9,681
-
248
10
292,605
9
295,396
3

77,228

85

3,502,741

1
22,448
3
147,170
2
64,914
8
370,818
-
63,508
-
2,743
-
19,204
1

40,783

15

731,588

100
$ 4,234,329

4
$ 137,726
6
208,240
-
68
32
1,318,607
9
376,623
1
33,265
-
45,720
-

16,498

52

2,136,747

-
11,238
-
20,362
1
77,495
1

13,730

2

122,825

54

2,259,572

22

1,000,000

-

1,547

7
281,889
1
17,619
16

669,982

24

969,490

-
(
6,921)

46
1,964,116
-

10,641

46

1,974,757

100
$ 4,234,329
 Dollars)
Amount
$ 600,941
19,956
202,721
486,381
2,598
1,489,172
6,054
265
453,997
383,124
119,540
3,764,749
25,737
129,195
69,518
357,328
20,655
2,410
13,665
51,683
670,191
$ 4,434,940
$ 180,922
238,583
16,026
1,400,023
392,297
33,097
8,513
14,796
2,284,257
11,130
12,426
54,658
17,656
95,870
2,380,127
1,000,000
1,547
303,977
17,619
722,955
1,044,511
3,747
2,049,845
4,968
2,054,813
$ 4,434,940		 Amount
$ 468,100
235,009
185,440
359,158
3,040
1,576,836
9,681
248
292,605
295,396
77,228
3,502,741
22,448
147,170
64,914
370,818
63,508
2,743
19,204
40,783
731,588
$ 4,234,329
$ 137,726
208,240
68
1,318,607
376,623
33,265
45,720
16,498
2,136,747
11,238
20,362
77,495
13,730
122,825
2,259,572
1,000,000
1,547
281,889
17,619
669,982
969,490
6,921)
1,964,116
10,641
1,974,757
$ 4,234,329		 ％




















































(
















11
6
4
9
-
37
-
-
7
7
2
83
1
3
2
9
1
-
-
1
17
100
3
5
-
31
9
1
1
-
50
-
1
2
-
3
53
24
-
7
-
16
23
-
47
-
47
100

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

(With Deloitte & Touche auditors’ report dated March 17, 2023)

130

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31,2022 AND 2021

(In Thousands of New Taiwan Dollars, Except Earnings Per Share)

Code
OPERATING REVENUE (Notes 4, 5,
21, and 27)
4100
Sales

4600
Maintenance revenue
4300
Rental revenue

4000
Total operating revenue

OPERATING COSTS (Notes 4, 11, 19,
22, and 27)
5110
Cost of goods sold
5600
Maintenance costs
5300
Rental costs

5000
Total operating costs

5900
GROSS PROFIT

OPERATING EXPENSES (Notes 10,
19, 22, and 27)
6100
Selling and marketing expenses
6300
Research and development
expenses
6450
Expected credit loss recognized on
trade receivables
6000
Total operating expenses

6900
PROFIT FROM OPERATIONS

NON-OPERATING INCOME AND
EXPENSES (Note 4)
7100
Interest income (Note 22)
7010
Other income (Notes 22 and 27)
7020
Other gains and losses (Note 22)

7050
Finance costs (Notes 22 and 27)

7060
Share of profit or loss of associates
and joint ventures (Note 13)
7000
Total non-operating income
and expenses
7900
PROFIT BEFORE INCOME TAX
7950
INCOME TAX EXPENSE (Notes 4 and
23)
8200
NET PROFIT FOR THE YEAR
 2022 ％
77

23
-

100

58
17
-

75

25

17
4
-

21

4

-
1
-

-

-

1

5
1

4
 2021
Amount
$ 4,583,448
1,349,167
17,909

5,950,524

3,447,531
969,922
14,571

4,432,024

1,518,500

1,024,057
230,033
5

1,254,095

264,405

4,043
62,094

23,093 )

7,826 )
5,033

40,251

304,656
59,711

244,945
 Amount
％
$ 4,574,665
78
1,292,764
22
2,166

-
5,869,595
100
3,506,830
59
936,117
16
2,385

-
4,445,332

75
1,424,263

25
949,915
16
217,379
4
2,143

-
1,169,437

20
254,826

5
4,335
-
22,710
-

8,352 )
-

4,880 )
-
3,218

-
17,031

-
271,857
5
56,880

1
214,977

4
(Continued)		 ％









(
(



















(
(

131

Code
OTHER COMPREHENSIVE INCOME
(Notes 19, 20, and 23)
8310
Items that will not be reclassified
subsequently to profit or loss:
8311
Remeasurement of defined
benefit plans
8316
Unrealized (loss) gain on
investments in equity
instruments at fair value
through other
comprehensive income
8349
Income tax relating to items
that will not be
reclassified subsequently
to profit or loss
8360
Items that may be reclassified
subsequently to profit or loss:
8361
Exchange differences on
translating the financial
statements of foreign
operations
8370
Share of the other
comprehensive income of
associates and joint
ventures accounted for
using the equity method
8300
Total other comprehensive
income, net of income tax
8500
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR
NET INCOME ATTRIBUTABLE TO:
8610
Owners of the Corporation

8620
Non-controlling interests

8600

TOTAL COMPREHENSIVE INCOME
(LOSS) ATTRIBUTABLE TO:
8710
Owners of the Corporation

8720
Non-controlling interests

8700

EARNINGS PER SHARE (Note 24)
9710
Basic

9810
Diluted
 2022 ％
1

-
-

-

-

1

5

4

-

4

5

-

5


 2021
Amount
$ 17,915
910

3,543 )
9,962

98)

25,146

$ 270,091

$ 250,730

5,785)

$ 244,945

$ 275,729

5,638)

$ 270,091

$ 2.51
$ 2.50		 Amount
$ 6,325
15,545

1,265 )

4,875 )

433)

15,297

$ 230,274

$ 215,822

845)

$ 214,977

$ 231,189

915)

$ 230,274

$ 2.16
$ 2.15		 ％

(
(



(


(






(
(
(



(


(





-
-
-
-
-
-
4
4
-
4
4
-
4

The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ report dated March 17, 2023)

(Concluded)

132

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED DECEMBER 31,2022 AND 2021

C o d e
A1
BALANCE AT JANUARY 1, 2021

Appropriation of the 2020 earnings
B1
Legal reserve
B5
Cash dividends - NT$1.5 per share
D1
Net profit for the year ended December 31, 2021
D3
Other comprehensive income (loss) for the year
ended December 31, 2021, net of income tax
D5
Total comprehensive income (loss) for the year
ended December 31, 2021
M5
Actual acquisition of interests in subsidiaries
Q1
Cash dividends from subsidiary

Z1
BALANCE AT DECEMBER 31, 2021

Appropriation of the 2021 earnings
B1
Legal reserve
B5
Cash dividends - NT$1.9 per share
D1
Net profit for the year ended December 31, 2022
D3
Other comprehensive income (loss) for the year
ended December 31, 2022, net of income tax
D5
Total comprehensive income (loss) for the year
ended December 31, 2022
O1
Cash dividends from subsidiary

Z1
BALANCE AT DECEMBER 31, 2022
 Equity attributable to ow Equity attributable to ow ners ofthe Corporation ners ofthe Corporation
Share capital -
ordinary shares
$ 1,000,000

-
-

-

-


-

-

-

1,000,000
-
-

-

-


-


-

$ 1,000,000
 Other equity
Exchange
differences on
translating the
financial statements
of foreign
operations
Unrealized gain or
loss on financial
assets at fair value
through other
comprehensive
income
Retained earnings
Capitalsurplus
Legal reserve
Special reserve
Unappropriated
earnings
$ 1,521
$ 263,132
$ 17,619
$ 617,855
( $ 15,110 )
( $ 2,116 )

-
18,757
-
(
18,757 )
-
-
-
-
-
(
150,000 )
-
-

-
-
-
215,822
-
-

-

-

-

5,062
(
5,240)

15,545


-

-

-

220,884
(
5,240)

15,545

26
-
-
-
-
-

-

-

-

-

-

-

1,547
281,889
17,619
669,982
(
20,350 )
13,429
-
22,088
-
(
22,088 )
-
-
-
-
-
(
190,000 )
-
-

-
-
-
250,730
-
-

-

-

-

14,331

9,758

910


-

-

-

265,061

9,758

910


-

-

-

-

-

-

$ 1,547
$ 303,977
$ 17,619
$ 722,955
($ 10,592)
$ 14,339

The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated March 17, 2023)		 Retained earnings


















(



(

133

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31,2022 AND 2021

(In Thousands of New Taiwan Dollars)

Code
CASH FLOWS FROM OPERATING
ACTIVITIES
A10000
Income before income tax
A20010
Adjustments for:
A20100
Depreciation expenses
A20200
Amortization expenses
A20300
Expected credit loss recognized on
trade receivables
A20400
Net gain on financial assets at fair
value through profit or loss
A20900
Finance costs
A21200
Interest income
A21300
Dividend income
A22300
Share of profit or loss of associates
and joint ventures accounted for
using the equity method
A22500
Gain on disposal of property, plant and
equipment
A23800
Write-downs (reversal) of inventories
A24100
Net loss (gain) on foreign currency
exchange
A29900
Lease modification gain
A30000
Changes in operating assets and liabilities
A31125
Contract assets
A31130
Notes receivable
A31150
Accounts receivable
A31180
Other receivables
A31200
Inventories
A31230
Prepayments
A31240
Other current assets
A32125
Contract liabilities
A32130
Notes payable
A32150
Accounts payable
A32180
Other payables
A32230
Other current liabilities
A32240
Net defined benefits liabilities
A33000
Cash inflows from operations
A33100
Interest received
A33200
Dividends received		 2022
$ 304,656
111,652
633
5

432 )
7,826

4,043 )

465 )

5,033 )

382 )
167
16,360

323 )

127,223 )
442
91,248
3,747

164,503 )

87,870 )

1,914 )
30,343
15,958
74,303
14,338

1,702 )
4,922)
272,866
4,047
465		 2021
$ 271,857
109,024
901
2,143

410 )
4,880

4,335 )

89 )

3,218 )

446 )

8 )

4,815 )

334 )
207,978
959

448,072 )

1,607 )
235,599

6,599 )
393
8,301

436 )

196,264 )
78,438
327
17,968)
236,199
4,333
89
(Continued)

(
(
(
(
(

(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(

134

Code
A33300
Interest paid
A33500
Income tax paid
AAAA
Net cash inflow from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
B00010
Acquisition of financial assets at fair value through
other comprehensive income
B00040
Proceeds from sale (acquisition) of financial assets
at amortized cost
B00100
Purchase of financial assets at fair value through
profit or loss
B00200
Proceeds from sale of financial assets at fair value
through profit or loss
B02700
Payments for property, plant and equipment
B02800
Proceeds from disposal of property, plant and
equipment
B04500
Payments for intangible assets
B03800
(Increase) decrease in refundable deposits
B06000
Decrease in lease receivables
BBBB
Net cash inflows from investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
C00100
Proceeds from short-term borrowings
C03000
Guarantee deposits received
C04020
Repayment of the principal portion of lease
liabilities
C04500
Dividends paid
C05400
Acquisition of subsidiaries
C05800
Cash dividends paid to non-controlling interests
CCCC
Net cash outflows from financing activities
DDDD
EFFECTS OF EXCHANGE RATE CHANGES ON THE
BALANCE OF CASH AND CASH EQUIVALENTS
HELD IN FOREIGN CURRENCIES
EEEE
NET INCREASE IN CASH AND CASH
EQUIVALENTS
E00100
CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF THE YEAR
E00200
CASH AND CASH EQUIVALENTS AT THE END OF
THE YEAR		 2022
$ 7,145 )

58,209)
212,024

2,379 )
694

727,950 )
943,435

48,452 )
429

265 )

51,298 )
-
114,214
28,380
3,926

45,908 )

190,000 )
-

35)

203,637)
10,240
132,841
468,100
$ 600,941		 2021
(
(

(
(
(
(
(


(
(
(
(


 (
(

(
(
(


(
(
(
(
(
(

 $ 4,793 )

43,903)
191,925
-

4,366 )

868,500 )
976,934

40,306 )
719
-
4,971
122
69,574
25,361
148

46,586 )

150,000 )

150 )

71)

171,298)

1,868)
88,333
379,767
$ 468,100

The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ report dated March 17, 2023)

(Concluded)

135

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Notes to Consolidated Financial Statements January 1 to December 31, 2022 and 2021

(Amounts in thousands of NTD, unless otherwise indicated)

  1. General

SYSCOM COMPUTER ENGINEERING CO. (hereinafter referred to as "the Company") was established in July 1975 and is mainly engaged in the lease and sale of computer systems, design engineering of computer software systems, computer hardware maintenance and computer information system integration. The Company's shares have been listed and traded on the Taiwan Stock Exchange since May 22, 2001.

The consolidated financial statements are presented in NTD, which is the functional currency of the Company.

The Company and its subsidiaries are hereinafter collectively referred to as the "The Group ".

  1. The Date and Procedures of Authorization of Financial Statements

The consolidated financial statements were approved by the Board of Directors on March 17, 2023.

  1. Application of New and Revised Standards and Interpretations (1) Application of the amendments to the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, “ IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC). Application of the IFRSs endorsed and issued into effect by the FSC did not have any material

impact on the Group’s accounting policies.

  • (2) The IFRSs endorsed by the Financial Supervisory Commission (FSC) for application starting from 2023.

Effective Date New/Amended/Revised Standards and Interpretations Announced by IASB Amendment to IAS 1, "Disclosure of Accounting Policies" January 1, 2023 (Note 1) Amendment to IAS 8, "Definition of Accounting Estimates" January 1, 2023 (Note 2) Amendments to IAS 12 “Deferred Tax related to Assets and January 1, 2023 (Note 3) Liabilities arising from a Single Transaction"

Note 1: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.

Note 2: The amendments will be applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023..

Note 3: Except for deferred taxes that were recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments were applied prospectively to transactions that occur on or after January 1, 2022.

As of the date the consolidated financial statements were authorized for issue, the Group had assessed that the application of above standards and interpretations would not have a material impact on the Group’s financial position and financial performance.

  • (3) New IFRSs in issue by the IASB but not yet endorsed and issued into effect by the FSC
New/Revised /Amended Standards andInterpretations
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of
Assets between an Investor and its Associate or Joint
Venture”
Amendments to IFRS 16 “Leases Liability in a Sale and
Leaseback”
IFRS 17 “Insurance contracts”
Amendment to IFRS 17
Amendment to IFRS 17 "Initial Application of IFRS 17 and
IFRS 9 - Comparative Information"
Amendment to IAS 1 "Classification of liabilities as current or
non-current"
Amendments to IAS 1 “Non-current Liabilities with Covenants”		 Effective Date Announced by
theIASB(Note1)
To be determined by IASB
January 1, 2024 (Note 2)
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2024
January 1, 2024

136

Note 1: Unless stated otherwise, the above new, revised or amended standards and interpretations are effective for annual reporting periods beginning on or after their respective effective dates. Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and leaseback transactions entered into after the date of initial application of IFRS 16.

As of the date the Group’s consolidated financial statements were authorized for issue, the Group is continuously evaluating the possible impact that the application of above standards and interpretations will have on the Group’s financial position and financial performance, and will disclose the relevant impact when the evaluation is completed.

  1. Summary of Significant Accounting Policies (1) 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 the IFRSs approved and issued into effect by the FSC.

  • (2) Basis of Preparation

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

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

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

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

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

  • (3) Classification of current and non-current assets and liabilities Current assets include:

  • A. Assets held primarily for the purpose of trading;

  • B. Assets expected to be realized within twelve months after the reporting period; and

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

  • Current liabilities include:

  • A. Liabilities held primarily for the purpose of trading;

  • B. Liabilities due to be settled within twelve months after the reporting period; and

  • C. Liabilities for which the Group does not have an unconditional right to defer settlement for at least twelve months after the reporting period.

Assets and liabilities that are not classified as current are classified as noncurrent.

  • (4) Basis of Consolidation

The consolidated financial statements include the financial statements of the Company and entities controlled by the Company (subsidiaries). The subsidiaries’ financial statements have been properly adjusted to make the accounting policies consistent with the accounting policies of the Group. In preparing the consolidated financial statements, all intra-group transactions, account balances, gains and losses have been eliminated. The total comprehensive income of the subsidiaries is attributable to the shareholders and non-controlling interests of the Company, even if this results in a loss balance for the non-controlling interests.

When a change in the Group 's ownership interest in a subsidiary does not result in a loss of control, it is treated as an equity transaction. The carrying amounts of the Group and non-controlling interests have been adjusted to reflect the changes in their relative interests in subsidiaries. The difference between the adjustment of the non-controlling interests and the fair value of the consideration paid or received is recognized directly in equity attributable to shareholders of the Company.

Please refer to Note 12 and Exhibits 4 and 5 for details of subsidiaries, shareholding percentage and principal businesses.

  • (5) Foreign Currencies

In preparing the financial statements of each individual 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.

137

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 denominated in foreign currencies that are measured at fair value are retranslated at the rates prevailing at the date when the fair value is determined. Exchange differences arising from the retranslation of non-monetary items are included in profit or loss for the period except for exchange differences arising from the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income; in which cases, the exchange differences are also recognized directly in other comprehensive income.

Non-monetary item denominated in a foreign currency and measured at historical cost is stated at the reporting currency as originally translated from the foreign currency.

For the purpose of presenting the consolidated financial statements, the financial statements of the Corporation’s foreign operations (including subsidiaries, associates and joint ventures in other countries) that are prepared using functional currencies which are different from the currency of the Corporation 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 year; and income and expense items are translated at the average exchange rates for the year. The resulting currency translation differences are recognized in other comprehensive income (attributed to the owners of the Corporation and non-controlling interests as appropriate).

(6) Inventories

Inventories are stated at the lower of cost or net realizable value item by item, except for those that may be appropriate to group items of similar or related inventories. Net realizable value is the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. The calculation of the cost of inventory is derived using the weighted-average method.

(7) Investment in associates and joint ventures

An associate is an entity over which the Group has significant influence and which is neither a subsidiary nor an interest in a joint venture. A joint venture is a joint arrangement whereby the Group and other parties that have joint control of the arrangement have rights to the net assets of the arrangement.

The Group uses the equity method to account for its investments in associates and joint ventures. Under the equity method, investments in an associate and a joint venture are initially recognized at cost and adjusted thereafter to recognize the Group’s share of the profit or loss and other comprehensive income of the associate and joint venture. The Group also recognizes the changes in the Group’s share of the equity of associates and joint venture attributable to the Group.

Any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets and liabilities of an associate and a joint venture at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized. Any excess of the Group’s share of the net fair value of the identifiable assets and liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss.

When the Group subscribes for additional new shares of an associate and a joint venture at a percentage different from its existing ownership percentage, the resulting carrying amount of the investment differs from the amount of the Group’s proportionate interest in the associate and joint venture. The Group records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus - changes in capital surplus from investments in associates and joint ventures accounted for using the equity method. If the Group’s ownership interest is reduced due to its additional subscription of the new shares of the associate and joint venture, the proportionate amount of the gains or losses previously recognized in other comprehensive income in relation to that associate and joint venture is reclassified to profit or loss on the same basis as would be required had the investee directly disposed of the related assets or liabilities. When the adjustment should be debited to capital surplus, but the capital surplus recognized from investments accounted for using the equity method is insufficient, the shortage is debited to retained earnings.

When the Group's share of losses in an associate or a joint venture equals or exceeds its equity interest in the associate and the joint venture (including the carrying amount of the associate or joint venture under the equity method and other long-term equity interests that are in substance a component of the Group 's net investment in the associate and the joint venture), the Group shall cease to recognize further losses. The Group recognizes additional losses and liabilities only to the extent that legal obligations, constructive obligations or payments on behalf of associate and the joint venture have been incurred.

138

The entire carrying amount of an investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is not allocated to any asset, including goodwill, that forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increases.

When the Group transacts with its associate and joint venture, profits and losses resulting from the transactions with the associate and joint venture are recognized in the Group’s consolidated financial statements only to the extent of interests in the associate and joint venture that are not related to the Group.

  • (8) Property, plant and equipment

Property, plant and equipment are stated at cost, less recognized accumulated d epreciation and accumulated impairment loss.

Depreciation is recognized using the straight-line method. Each significant part is depreciated separately. The Group estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis

Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

(9) Goodwill

Goodwill arising from the acquisition of a business is carried 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 cashgenerating 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 is 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.

Upon disposal of an operation within a cash-generating unit to which goodwill is allocated, the amount of goodwill associated with the disposed operation is included in the carrying amount of the operation to determine the disposal gain or loss.

(10) Intangible assets

  • A. Acquired separately

Intangible assets with finite useful lives acquired separately are initially measured at cost and subsequently measured at cost less accumulated amortization and accumulated impairment. Intangible assets are amortized on a straight-line basis over their useful lives. The Group reviews the estimated useful lives, residual values and amortization methods at least at the end of each year and defers the effect of changes in applicable accounting estimates. Intangible assets with indefinite useful lives are stated at cost less accumulated impairment.

  • B. Derecognition

When an intangible asset is derecognized, the difference between the net disposal price and the carrying amount of the asset is recognized in profit or loss for the period.

  • (11) Impairment of Property, Plant and Equipment, Right-of-use Assets, Intangible Assets Other Than Goodwill and Incremental Costs of Obtaining Contracts

At the end of each reporting period, the Group reviews the carrying amounts of its property, plant and equipment, right-of-use assets and intangible assets, excluding goodwill, to determine whether there is any indication that those assets have suffered any 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 an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Corporate assets are

139

allocated to the smallest group of cash-generating units on a reasonable and consistent basis of allocation.

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually, and whenever there is an indication that the asset may be impaired.

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 or 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 or cash-generating unit in prior years. A reversal of an impairment loss is recognized in profit or loss.

(12) Financial instruments

Financial assets and financial liabilities are recognized on the Group only balance sheets when a group entity becomes a party to the contractual provisions of the instruments.

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 fair value through profit or loss) 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 fair value through profit or loss are recognized immediately in profit or loss.

  • A. Financial assets

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

  • a. Measurement category

The Group’s financial assets are classified into the following categories: financial assets at FVTPL, financial assets at amortized cost, and investments in equity instruments at FVTOCI.

  • (a) Financial assets at FVTPL

For certain financial assets which include debt instrument that do not meet the criteria of amortized cost or FVTOCI, it is mandatorily required to measure them at FVTPL. Financial assets mandatorily classified as at FVTPL include investments in equity instruments which are not designated as at FVTOCI and debt instruments that do not meet the amortized cost criteria or the FVTOCI criteria.

Financial assets at FVTPL are subsequently measured at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. The dividends, interest earned and net gain or loss recognized in profit or loss on the financial asset. Fair value is determined in the manner described in Note 26.

  • (b) Financial assets at amortized cost

Financial assets that meet the following two 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, investments in debt instruments, notes receivable, accounts receivable, lease receivables, other receivables and refundable deposits, which equals to gross carrying amount determined by 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 multiply the gross carrying amount of a financial asset.

Cash equivalents, held to meet short-term cash commitments, 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, as well as deposits

140

in the bank and commercial papers, which are subject to an insignificant risk of changes in value.

(c) Investments in equity instruments at FVTOCI

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

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

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

The Group assesses financial assets (including accounts receivable), lease receivables and contract assets at amortized cost at each balance sheet date based on Expected Credit Loss （ ECL ） .

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

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

All impairment of financial assets is recognized through the reduction of the carrying amount of the provisioned account.

c. De-recognition 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. On derecognition of an investment in an equity instrument at FVTOCI, the cumulative gain or loss that had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through profit or loss.

  • B. Financial liabilities

  • a. Subsequent measurement

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

    • method.

  • b. Derecognition of financial liabilities

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

  • (13) Recognition of revenue

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

  • A. Sales revenue Project contract revenue

Project contract revenue is derived from hardware and software system integration services. With the hardware and software system integration services provided by the Group, customers also obtain and consume performance benefits. The hardware and software system integration services rely on the input of technical personnel and the completion of hardware

141

equipment, and the Group measures the progress of completion based on the estimated total cost invested. Customers pay in installments according to contractual agreements.The Group recognizes contract assets over time in the course of providing services and reclassifies them as accounts receivable at the time of billing. If the amount received exceeds the amount of revenue recognized, the difference is recognized as a contract liability.

If it is probable that total contract costs will exceed total contract revenues, all expected losses are recognized as expenses immediately.

Product sales revenue

The Group recognizes revenue and accounts receivable from sales of computer hardware and software and computer peripherals at the point when each contractual obligation is satisfied or when the customer has obtained control of and access to the products and assumes the risk of the products.

  • B. Service revenue

Service revenue is derived from the provision of subsequent maintenance services for software and hardware equipment during the contract period. The Group recognizes such revenue over time.

  • (14) Leases

At the inception of a contract, the Group assesses whether the contract is, or contains, a lease. A. The Group as lessor.

Leases are classified as finance leases whenever the terms of a lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Under capital leases, lease payments include fixed payments. Net investment in leases is measured as the sum of the present value of lease payments receivable and the unguaranteed residual value plus original direct costs and is expressed as capital lease receivables. Capital lease income is allocated to each accounting period to reflect the constant rate of return that the Group's outstanding net lease investment can earn in each period.

Under operating leases, lease payments are recognized as income on a straight-line basis over the relevant lease period..

  • B. The Group as lessee.

Except for payments for low-value asset leases and short-term leases which are recognized as expenses on a straight-line basis, the Group recognizes right-of-use assets and lease liabilities for all leases at the commencement date of the 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, and less any lease incentives received, any initial direct costs incurred and an estimate of costs needed to restore the underlying assets. Right-of-use assets are subsequently 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 Group only 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 comprise 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 rates.

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 or a change in future lease payments resulting from a change in an index or a rate used to determine those payments, the Group 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. Lease liabilities are presented on a separate line in the Group only balance sheets.

  • (15) Government Grants

Government grants are recognized when there is reasonable assurance that the Group will comply with the conditions attached to the government subsidy and that the subsidy will be received. Government grants are recognized in other income on a systematic basis over the period in which the related costs for which they are intended to compensate are recognized as expenses by the Group.

142

Government subsidies conditioned on the purchase, construction or acquisition by other means of noncurrent assets by the Group are recognized as deferred revenue and are transferred to profit or loss on a reasonable and systematic basis over the useful lives of the related assets.

Government grants are recognized in profit or loss in the period in which they become collectible if they are intended to compensate for expenses or losses already incurred or to provide immediate financial support to the Group and have no future related costs.

  • (16) Employee benefits

  • A. Short-term employee benefits

Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service. B. Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service entitling them to the contributions.

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

Net defined benefit liability (asset) represents the actual deficit (surplus) in the Company’s defined benefit plan. 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.

  • (17) Income tax

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

  • A. Current tax

The Group determines income (loss) for the period in accordance with the regulations enacted by the income tax reporting jurisdictions and calculates income tax payable (recoverable) accordingly.

According to the Income Tax Act in the ROC, an additional tax of unappropriated earnings is provided for in the year the stockholders approve to retain the earnings. Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

  • B. Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the Company’s financial statements 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 and unused tax credits from purchases of machinery, equipment and technology and research, development expenditures, etc. 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, associates and joint ventures, 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 such temporary differences 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 asset 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 assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates (and tax laws)

143

that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax assets and liabilities reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

C.

  • Current and deferred tax

Current and deferred tax 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 tax are also recognized in other comprehensive income or directly in equity respectively.

5. Critical Accounting Judgments and Key Sources of Estimation and Uncertainty

In the application of the Group’s accounting policies, the management is required to make judgments, estimates and assumptions which are based on historical experience and other factors that are not readily apparent from other sources. Actual results may differ from these estimates.

The Group has taken the recent development of the COVID-19 outbreak and its possible impact on the economic environment into consideration in making significant accounting estimates related to cash flow projections, growth rates, discount rates, profitability, etc. Management will continue to review the estimates and underlying assumptions. If a revision of an estimate affects only the current period, it is recognized in the period in which it is revised. If a revision of an accounting estimate affects both the current and future periods, it is recognized in the period in which it is revised and in the future periods. Critical Accounting Judgments Timing of recognition of revenue

The Group assesses whether a performance obligation is satisfied over time or at a certain point in time in accordance with the terms of the customer contract and applicable regulations.

The revenue generated from the hardware and software system integration services provided by the Group y under the contracts depends on the input of technical personnel and the completion of hardware equipment. The Group measures the progress of completion based on the estimated total cost invested and the customers pay in installments according to the contracts. The Group recognizes contract assets in the course of providing services and recognizes revenue based on the total contract price in proportion to completion. For the purpose of calculating the percentage of completion, the Group estimates the total contract cost at the same time when the contract is signed. If there is a subsequent change in the total contract cost, the percentage of completion is revised and the revenue recognition is adjusted in the period of change.

  1. Cash and cash equivalents
Cash and cash equivalents
Cash on hand and revolving funds
Bank checking and demand deposits
Cash equivalents (investments with
original maturities of less than 3
months)
Bank time deposits
Commercial papers		 December 31, 2022
$ 707
297,539
71,704

230,991
$ 600,941		 December 31, 2021




$ 720
391,267
67,512
8,601
$ 468,100

The interest rate ranges of bank deposits ,bank time deposits and commercial papers with original maturities of less than 3 months at the balance sheet date were as follows:

Bank demand deposits
Bank time deposits with original
maturities of less than 3 months
Bank time deposits
Commercial papers		 December 31, 2022
0.01%~0.46%
0.125%~3.69%
0.66%~0.80%		 December 31, 2021
0.01%～0.4%
0.125%～1.02%
-

144

7.
8.		 Financial assets at fair value through profit or loss
December 31, 2022
Financial assets mandatorily measured at
fair value through profit or loss - non-
derivative financial assets
- Fund beneficial certificates
$ 19,956
Financial assets at fair value through other comprehensive income
December 31, 2022
Investments in equity instruments-non-
current
Domestic investments
Listed stocks
$ 24,142
Unlisted stocks

1,595
$ 25,737		 Financial assets at fair value through profit or loss
December 31, 2022
Financial assets mandatorily measured at
fair value through profit or loss - non-
derivative financial assets
- Fund beneficial certificates
$ 19,956
Financial assets at fair value through other comprehensive income
December 31, 2022
Investments in equity instruments-non-
current
Domestic investments
Listed stocks
$ 24,142
Unlisted stocks

1,595
$ 25,737		 December 31, 2021 December 31, 2021
$ 235,009
December 31, 2021

Investments in equity instruments-non-
current
Domestic investments
Listed stocks
Unlisted stocks




$ 20,853
1,595
$ 22,448

The Group invests in the above domestic stocks for medium- to long-term strategic purposes and expects to make profits from the long-term investments. The management of the Group considers that it is inconsistent with the aforementioned long-term investment plan to include short-term fluctuations in the fair values of these investments in profit or loss, and therefore chooses to designate these investments as measured at fair value through other comprehensive income.

The Group purchased the common stocks of Turn Cloud Technology Service Inc. in January 2020, which was designated as investment at fair value through other comprehensive income because it was for the medium- to long-term strategic purpose. The company's common stocks will be available for trading on the Pioneer Stock Board of the Emerging Stock Market on November 26, 2021, and as regular Emerging Stock Market stocks starting February 15, 2022.

  1. Financial assets at amortized cost
Financial assets at amortized cost
Time deposits pledged
Bank time deposits with original
maturities of more than 3 months
Current
Non-current
Total		 December 31, 2022
$ 231,060

100,856
$ 331,916
$ 202,721

129,195
$ 331,916		 December 31, 2021










$ 235,660
96,950
$ 332,610
$ 185,440
147,170
$ 332,610

As of December 31, 2022 and 2021, the interest rate ranges for time deposits with original maturity over 3 months are 0.51%~1.40% and 0.35%~1.07% per annum.

For information on pledged financial assets at amortized cost, see Note 28.

The Group assessed that the expected credit risk of the above financial assets at amortized cost was not significant and its credit risk did not increase after the initial recognition. The Group did not expect credit losses on the above financial assets at amortized cost to occur within 12 months after the date of the financial statements, and no allowance for losses had been recognized as of December 31, 2022 and 2021.

10. Accounts receivable

Accounts receivable
Measured at amortized cost
Accounts receivable
Less: Allowance for losses		 December 31, 2022
$ 1,490,655
(
1,483)
$ 1,489,172		 December 31, 2021

(
(
 $ 1,578,296
1,460)
$ 1,576,836

The average credit period for the Group's product sales is 30 to 120 days, and the accounts receivable are not interest-bearing.

145

To mitigate credit risk, the Group's management has assigned a dedicated team to be responsible for credit limit determination, credit approval and other monitoring procedures to ensure that appropriate actions have been taken to collect overdue receivables. In addition, the Group reviews the recoverable amounts of receivables on a case-by-case basis at the balance sheet date to ensure that appropriate impairment losses have been recorded for uncollectible receivables. Accordingly, the management of the Company believed that the credit risk of the Group y has been significantly reduced.

The Group recognizes an allowance for losses on accounts receivable based on the expected credit losses over the duration of existence of the accounts receivable. Expected credit losses over the duration of existence are based on the customer's past default history, current financial position and past collection experience, observable changes in national or regional economic conditions related to receivables, and the debtor's industry indicators.

If there is evidence that the counterparty is in serious financial difficulty and the Group cannot reasonably expect to recover the amount, for example, if the counterparty is in liquidation, the Group directly writes off the related accounts receivable but continues the collection activities, and the amount recovered from the collection is recognized in profit or loss.

Based on the above considerations, the Group measured the allowance for losses on accounts receivable based on the aging range of accounts receivable (based on the post date) and evaluated the credit risk of individual customers as follows:

11. December 31, 2022
1～60 days
61～90 days
91～120 days 121 days or more
Total
Total carrying amount
$ 1,231,408 $ 157,786 $ 22,655 $ 78,806 $ 1,490,655
Allowance for losses (expected
credit losses over the duration
of existence)

-

-

-
(
1,483)
(
1,483)
Amortized cost
$ 1,231,408
$ 157,786
$ 22,655
$ 77,323
$ 1,489,172
December 31, 2021
1～60 days
61～90 days
91～120 days 121 days or more
Total
Total carrying amount
$ 1,446,276 $ 73,881 $ 32,038 $ 26,101 $ 1,578,296
Allowance for losses (expected
credit losses over the duration
of existence)

-

-

-
(
1,460)
(
1,460)
Amortized cost
$ 1,446,276
$ 73,881
$ 32,038
$ 24,641
$ 1,576,836
Information on the changes in the allowance for losses on accounts receivable is as follows:
2022
2021
Balance at the beginning of the year
$ 1,460
$ 1,412
Impairment loss provided for the year
5
2,143
Write-off for the year
-
(
2,091 )
Foreign currency translation differences

18
(
4)
Balance at the end of the year
$ 1,483
$ 1,460
Inventories
December 31, 2022
December 31, 2021
Merchandises
$ 220,735
$ 132,549
Project inventories
226,770
147,883
Inventories in transit
5,862
10,840
Maintenance materials

630

1,333
Total
$ 453,997
$ 292,605		 1～60 days 61～90 days 91～120 days 121 days or more 121 days or more 121 days or more Total


$ 1,231,408
-

$ 1,231,408

1～60 days

$ 157,786
-

$ 157,786

61～90 days

$ 22,655
-

$ 22,655

91～120 days		 $ 78,806
(
1,483)

$ 77,323

121 days or more
(
 $ 1,490,655

1,483)
$ 1,489,172
Total
$ 1,412
2,143
(
2,091 )
(
4)
$ 1,460
December 31, 2021


$ 132,549
147,883
10,840
1,333
$ 292,605

Merchandises are mainly computers and peripheral software and hardware equipment for sale. Project inventories are mainly hardware and software merchandise and service costs that have been invested in projects but no revenue has been recognized.

The cost of goods sold related to inventories for the years 2022 and 2021 were $3,447,531 thousand and $3,506,830 thousand, respectively. The cost of goods sold included a loss on decline in value of inventories of $167 thousand and a gain on reversal of value of inventories of $8 thousand, respectively. The increase in net realizable value of inventories was due to the sale of inventories previously recorded as a loss on decline in value.

146

12. Subsidiaries

  • (1) Subsidiaries included in the consolidated financial statements

The entities covered by the consolidated financial statements are as follows:

Name of the investor
company
The Company






Coach Technology
Management Inc.

Casemaker Inc. and
SYSCOM INTERNA-
TIONAL INC.

 Name of the subsidiary
Casemaker Inc.

SYSCOM INTERNATIONAL INC.

Coach Technology Management Inc.

Syscom Computer(Thailand)Co., Ltd.

Wisemaker Technology Co.

Netmaker Technology Co., Ltd.
(Netmaker Technology Co.)

Syscom Computer(Thailand)Co., Ltd.

Syscom Computer(Shenzhen)Co., Ltd.
Xian Linan Computer Co., Ltd.
 Business nature
Sales of computer software, hardware
and related products.
Investments in other businesses
Diagnostic consulting for corporate
management, domestic and foreign
investment referral, and computerized
design consulting.
Development and maintenance of
software and other businesses.
Sales of computer software, hardware
and related products.
Information software, data processing
and electronic information supply
services
Development and maintenance of
software and other businesses
Computer equipment software
development, sales of self-developed
technical achievements services,
computer system integration and
network wiring engineering.
Development and production of
computer equipment and computer
software, computer system integration
network construction, sales of self-
produced products, and provision of
after-sales technical services.		 Ownership percentage
December 31,
2021
100.00%
100.00%
97.50%
91.40%
98.72%
86.60%
0.54%
98.27%
74.38%		 Description
December 31,
2022
100.00%
100.00%
97.50%
91.40%
98.72%
86.60%
0.54%
98.27%
74.38%
(1)
(1)
(1)
(1)
(1)
(1)
(1)
(1)
(1)

  • A. T he amounts shown in the consolidated financial statements are recognized based on the financial statements of each subsidiary audited by CPAs for the same period.

  • B. The Company acquired 13 thousand shares of Netmaker Technology Co., Ltd. from a non-related party for NT$128 thousand in February 2021, and the shareholding percentage was changed to 86.60% after the acquisition.

  • C. The Company acquired 1 thousand shares of Wisemaker Technology Co. from a nonrelated party for NT$22 thousand in October 2021, and the shareholding percentage was changed to 98.72% after the acquisition.

  • (2) Subsidiaries not included in the consolidated financial statements: None.

  • (3) Subsidiaries with material non-controlling interests: None.

  • Investments accounted for using the equity method

Investments in associates
Investments in joint ventures		 December 31, 2022
$ 15,486

54,032
$ 69,518		 December 31, 2021 December 31, 2021




$ 12,179
52,735
$ 64,914
  • (1) Investments in associates
Investments in associates
Associates of no materiality
individually
Unlisted companies
DBMaker Japan Inc.		 December 31, 2022
$ 15,486		 December 31, 2021
$ 12,179

The ownership interest in associates and the percentage of voting rights at the balance sheet date were as follows:

were as follows:
Name of the company
DBMaker Japan Inc.		 December 31, 2022
49.89%		 December 31, 2021
49.89%

147

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

equity method.
Share of the Group
Net profit for the year
Other comprehensive income
Total comprehensive income		 2022
$ 3,639
332)
$ 3,307		 2021

(
(
 $ 2,036
1,647)
$ 389

The calculation of the Group’s share of profit or loss and other comprehensive income of associates under the equity method for 2022 and 2021 is based on the financial statements of each associate for the same period that have not been audited by CPAs; however, the management of the Group believes that the fact the financial statements of the aforementioned investees have not been audited by the CPAs would not have a material effect.

(2)

Investments in joint ventures

would not have a material effect.
Investments in joint ventures
Joint ventures of no materiality
individually
Cloudmaster Co., Ltd.		 December 31, 2022
$ 54,032		 December 31, 2021
$ 52,735

The Group’s ownership interest in joint ventures and the percentage of voting rights at the balance sheet date were as follows:

sheet date were as follows:
Name of the company
Cloudmaster Co., Ltd.		 December 31, 2022
50.00%		 December 31, 2021
50.00%

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

the equity method.
Share of the Group
Net profit for the year
Other comprehensive income
Total comprehensive income		 2022
$ 1,394
97)
$ 1,297		 2021

(
(
 $ 1,182
433)
$ 749

In March 2013, the Group invested in 50% of the shares of Cloudmaster Co., Ltd. in a joint venture with a Japanese company approved by the Investment Commission, MOEA, which is engaged in information software, data processing and electronic information supply services. According to the joint venture agreement, the Board of Directors and the shareholders' meeting of Cloudmaster Co., Ltd. adopt a majority rule for its resolutions, but the Group holds less than half of the seats of directors of the Cloudmaster, and in accordance with the management authority of its actual operations, material resolutions and decisions must be approved by the shareholders of both parties, but the Group is unable to directly decide to obtain other variable remuneration that is not available to the shareholders of the other party, and has no direct ability to influence the remuneration obtained by participating in the joint venture investment. Therefore, the Group has no control over Cloudmaster Co., Ltd.

The shares of profit or loss and other comprehensive income of joint ventures under the equity method for the years 2022 and 2021 were recognized based on the financial statements of the joint ventures’ financial statements for the same periods audited by CPAs.

For information on the nature of business, principal place of business and country of incorporation of the above associates and joint ventures, please refer to Exhibit 4 "Information on Investees".

14. Property, plant and equipment

Property, plant and equipment
For the Group’s use
Under operating lease		 December 31, 2022
$ 333,516

23,812
$ 357,328		 December 31, 2021




$ 341,556
29,262
$ 370,818

148

(1) For the Group’s use

Cost
Balance at January 1,
2022
Addition
Disposal
Reclassification
Net exchange
difference
Balance at December
31, 2022
Accumulated
depreciation
Balance at January 1,
2022
Disposal
Depreciation expenses
Reclassification
Net exchange
difference
Balance at December
31, 2022
Net at December 31,
2022
Cost
Balance at January 1,
2021
Addition
Disposal
Reclassification
Net exchange
difference
Balance at December
31, 2021
Accumulated
depreciation
Balance at January 1,
2021
Disposal
Depreciation expenses
Reclassification
Net exchange
difference
Balance at December
31, 2021
Net at December 31,
2021		 Land Buildings Maintenance
equipment		 Computer
equipment		 Leasehold
improvements		 Others Total









(





 $ 121,490
-
-
-
1,224

$ 122,714

$ -
-

-
-
-

$ -

$ 122,714

$ 121,813

-
-
-

323)

$ 121,490

$ -

-

-
-
-

$ -

$ 121,490













(


(

 $ 98,096

-
-

-
2,425

$ 100,521

$ 50.251


-

1,928

-
1,538

$ 53,717

$ 46,804

$ 97,772

948
-

-

624)

$ 98,096

$ 48,772

-

1,870
-


391)

$ 50,251

$ 47,845
 $ 89,134

10,406
(
10,419 )

2,433

-

$ 91,554

$ 53,322
(
10,418 )

13,049
(
40 )

-

$ 55,913

$ 35,641

$ 102,859

5,209
(
20,323 )
1,389

-

$ 89,134

$ 60,239

(
20,323 )
13,532
(
126 )

-

$ 53,322

$ 35,812
 $ 292,799

31,414
(
50,502 )

273

464

$ 274,448

$ 177,991
(
50,502 )

34,052

-

415

$ 161,956

$ 112,492

$ 306,037

30,069
(
45,384 )
2,434
(
357)

$ 292,799

$ 188,618

(
45,349 )
35,095
(
34 )
(
339)

$ 177,991

$ 114,808
 $ 102,592

4,752
(
95 )

-

54

$ 107,303

$ 90,100
(
95 )

10,403

-

45

$ 100,453

$ 6,850

$ 102,019

589

-

-
(
16)

$ 102,592

$ 80,554


-

9,561

-
(
15)

$ 90,100

$ 12,492
 $ 19,788

2,431
(
1,938 )

-

170

$ 20,451

$ 10,679
(
1,892 )

2,481

-

168

$ 11,436

$ 9,015

$ 20,834

3,491
(
4,490 )
-
(
47)

$ 19,788

$ 12,365

(
4,252 )
2,609
-

(
43)

$ 10,679

$ 9,109
 $ 723,899

49,003
(
62,954 )

2,706

4,337
$ 716,991
$ 382,343
(
62,907 )

61,913
(
40 )

2,166
$ 383,475
$ 333,516
$ 751,334
40,306
(
70,197 )
3,823
(
1,367)
$ 723,899
$ 390,548
(
69,924 )
62,667
(
160 )
(
788)
$ 382,343
$ 341,556

Depreciation expenses are provided on a straight-line basis over the following useful lives: Buildings 39 to 60 years Maintenance equipment 6 years Computer equipment 3 to 8 years Leasehold improvements 1 to 10 years Others - Office equipment 3 to 8 years -Transportation equipment 5 years Please refer to Note 28 for the amount of property, plant and equipment set as collateral for loans.

  • (2) Under operating lease
Under operating lease
Cost
Balance at January 1, 2022
Reclassification
Balance at December 31, 2022		 Machinery equipment


$ 30,406
198
$ 30,604

149

Accumulated depreciation and impairment
Balance at January 1, 2022

Depreciation expenses

Balance at December 31, 2022

Net at December 31, 2022

Cost
Balance at January 1, 2021

Reclassification

Balance at December 31, 2021

Accumulated depreciation and impairment
Balance at January 1, 2021

Depreciation expenses
Reclassification
(
Balance at December 31, 2021

Net at December 31, 2021
 $ 1,144
5,648
$ 6,792
$ 23,812
$ 1,834
28,572
$ 30,406
$ 131
1,312
299)
$ 1,144
$ 29,262

The Group leases machinery equipment under operating leases for a period of 1 to 3 years. The lessee does not have a preferential right to acquire the asset at the end of the lease period. The total future lease payments to be received under operating leases are as follows:

Year 1
Year 2
Year 3
Year 4		 December 31, 2022
$ 17,323
16,831
16,740

-
$ 50,894		 December 31, 2021 December 31, 2021




$ 17,834
17,277
16,830
16,740
$ 68,681

Assets under operating leases are depreciated using the straight-line method over 1 to 6 years of useful life.

15.
(1)
(2)		 Lease agreements
Right-of-use assets
Carrying amount of right-of-use
assets
Buildings
Addition of right-of-use assets
Depreciation expenses of right-of-use
assets
Buildings
Lease liabilities
Carrying amount of lease liabilities
Current
Non-current		 December 31, 2022
$ 20,655
2022
$ 875
$ 44,091
December 31, 2022
$ 8,513
$ 12,426		 December 31, 2021 December 31, 2021
$ 63,508
2021
$ 21,517
$ 45,045
December 31, 2021


$ 45,720
$ 20,362

The discount rate range for lease liabilities is as follows:

150

Buildings December 31, 2022
0.75%~2.61%		 December 31, 2021
0.75%~2.61%

(3) Important lease activities and terms with the Group as lease

The Group leases in certain buildings for use as offices and dormitories for a period of 2 to 10 years. All operating leases with lease periods of more than 5 years include a review clause that rents are adjusted every 5 years in accordance with market rates. At the end of the lease periods, the Group does not have preferential purchase rights for the leased buildings.

(4) Other lease information The Group leases out its own property, plant and equipment as lessor under operating leases as described in Note 14

described in Note 14
Short-term lease expenses
Variable lease payment expenses
excluded from the measurement of
lease liabilities
Total cash (outflow) from leases		 2022
$ 5,584
$ 229
$ 52,473)		 2021


(

(		 $ 3,490
$ 820
$ 52,427)

The Group has elected to waive the applicable recognition for leases of buildings and leasehold improvements that qualify as short-term leases and does not recognize the related right-of-use assets and lease liabilities for these leases.

16. Intangible assets

2022

gible assets
2022
Net at January 1, 2022

Addition

Amortization expenses

Net exchange difference

Net at December 31, 2022
 Computer software
costs
$ 2,150
265
(
633 )

35

$ 1,817
 Goodwill
$ 593
-
-
-

$ 593
 Total

(


(

 $ 2,743
265

633 )

35
$ 2,410

2021

2021
Net at January 1, 2021

Amortization expenses

Net exchange difference

Net at December 31, 2021
 Computer software
costs
$ 3,063
(
901 )
(
12)

$ 2,150
 Goodwill
$ 593
-
-

$ 593
 Total

(
(


(
(
 $ 3,656

901 )

12)
$ 2,743

Amortization expenses for computer software costs are accrued on a straight-line basis over 1 to 10 years of useful life.

As of December 31, 2022 and 2021, the Group assessed that there was no indication that computer software costs may have been impaired and therefore no impairment test was performed; as of December 31, 2022 and 2021, the Group assessed that the recoverable amount of goodwill was higher than its carrying amount and therefore no impairment was made.

17. Loans

Loans
Unsecured loans
- Line of credit borrowings		 December 31, 2022
$ 180,922		 December 31, 2021
$ 137,726

The interest rates on revolving bank loans were 2.08% to 7.08% and 1.37% to 2.86% as of December 31, 2022 and 2021, respectively.

151

18. Other payables

Other payables
Salaries and bonuses payable
Business taxes payable
Insurance premiums payable
Pension expenses payable
Profit-sharing remuneration payables for
employees
Leave benefits payable
Others		 December 31, 2022
$ 288,394
26,275
18,507
14,858
9,600
2,414

32,249
$ 392,297		 December 31, 2021




$ 248,183
61,834
17,210
14,384
8,450
2,271
24,291
$ 376,623

19. Retirement benefits plans

(1) Defined contribution plan

The pension systems of the Company, Coach Technology Management Inc., Wisemaker Technology Co., and Netmaker Technology Co., Ltd. within the Group under the “Labor Pension Act” are government-administered defined contribution pension plans, under which these companies are required to contribute 6% of employees' monthly salaries to their personal pension accounts with the Bureau of Labor Insurance.

  • (2) Defined benefits plan

The pension systems of the Company, Coach Technology Management Inc., Wisemaker Technology Co., and Netmaker Technology Co., Ltd. within the Group under the “Labor Standards Act” are government-administered defined benefits pension plans. Employees' pension payments are calculated based on the years of service and the average salary for the six months before the approved retirement date. These companies are required to appropriate 2% of the employees' monthly salaries to the Supervisory Committee of Labor Retirement Reserve for deposit into a special account in the Bank of Taiwan in the Committee's name. Before the end of the year, if the estimated balance of the special account is not enough to pay for the workers who are expected to meet the retirement requirements in the following year, the difference will be made up in one lump sum by the end of March of the following year. The Group has no right to influence the investment management strategy as the special account is entrusted to be administered by the Bureau of Labor Fund, Ministry of Labor.

The amounts of defined benefit plan included in the consolidated balance sheets are as follows:

Present value of defined benefits
obligations
Fair value of planned assets
Net defined benefits liabilities
The changes in net defined benefits
Balance at January 1, 2021

Current service costs

Interest expense (income)

Recognized in profit or loss

Remeasurement
Return on planned assets (other
than the amounts included in
net interest)

Actuarial loss - changes in
demographic assumptions

Actuarial gain - changes in
financial assumptions

Actuarial gain - adjustment
through experiences
 December 31, 2022
December 31, 2021
$ 210,595
$ 228,161
(
155,937)
(
150,666)
$ 54,658
$ 77,495
liabilities (assets) were as follows:
Present value of
defined benefits
obligations
Fair value of
planned assets
Net defined
benefits liabilities
(assets)
$ 237,725
($ 135,937)
$ 101,788
273

-

273

694
(
392)

302

967
(
392)

575
-
(
2,013 ) (
2,013 )
4,538

-

4,538
(
6,066 )
-
(
6,066 )
(
2,784)

-
(
2,784)		 December 31, 2021 December 31, 2021 December 31, 2021 December 31, 2021

(
 $ 228,161
150,666)
$ 77,495
Net defined
benefits liabilities
(assets)



(
(







(
(
(		 $ 101,788
273
302
575

2,013 )
4,538

6,066 )
2,784)

The changes in net defined benefits liabilities (assets) were as follows:

152

Recognized in other comprehensive
income

Appropriated by the employer

Benefits payment

Balance at December 31, 2021

Current service costs

Interest expense (income)

Recognized in profit or loss

Remeasurement
Return on planned assets (other
than the amounts included in
net interest)

Actuarial gain - changes in
financial assumptions

Actuarial loss - adjustment
through experiences

Recognized in other comprehensive
income

Appropriated by the employer

Benefits payment

Balance at December 31, 2022
 Present value of
defined benefits
obligations
(
4,312)


-

(
6,219)


228,161

228

1,434


1,662

-

(
8,903 )

2,570

(
6,333)


-

(
12,895)

$ 210,595
 Fair value of
planned assets
(
2,013)

(
18,543)


6,219

(
150,666)

-

(
938)

(
938)

(
11,582 )
-


-

(
11,582)

(
5,646)


12,895

($ 155,937)
 Net defined
benefits liabilities
(assets)		 Net defined
benefits liabilities
(assets)
(

(



(

(

(
 (
(

(
(
(
(

(
(

(		 (
(




(
(

(
(

 6,325)
18,543)
-
77,495
228
496
724

11,582 )

8,903 )
2,570
17,915)
5,646)
-
$ 54,658

The amounts recognized in profit or loss for defined benefit plan are summarized by function as follows:

follows:
Operating costs
Operating expenses		 2022
$ 194
530
$ 724		 2021




$ 176
399
$ 575

The Group is exposed to the following risks as a result of the pension system under the “Labor Standards Act”:

  • A. Investment risk: The Bureau of Labor Funds, Ministry of Labor invests the Labor Pension Fund in domestic (and foreign) equity securities, debt securities and bank deposits through its own operations and by entrusted 3rd parties, but the amount allocated to the Group's plan assets should not be less than the income at the interest rate of two-year time deposits in local banks.

  • B. Interest rate risk: A decrease in interest rates on government bonds will increase the present value of the defined benefit obligation, but the return on debt investment in plan assets will also increase, which will have a partially offsetting effect on the net defined benefit obligation.

  • C. Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salary of the plan member. Therefore, increases in plan member’s salary will result in an increase in the present value of the defined benefit obligation.

The present value of the Group's defined benefit obligation was actuarially determined by a qualified actuary:

==> picture [410 x 38] intentionally omitted <==

The amount by which the present value of the defined benefit obligation would increase (decrease) if there are reasonable possible changes in significant actuarial assumptions, with all other assumptions held constant, is as follows:

December 31, 2022 December 31, 2021 Discount rate Increase by 0.25% ( $ 3,537 ) ( $ 4,187 )

153

Decrease by 0.25%
Expected salary increase rate
Increase by 0.25%
Decrease by 0.25%		 December 31, 2022
$ 3,633
$ 3,597
($ 3,519)		 December 31, 2021 December 31, 2021


(

(		 $ 4,307
$ 4,239
$ 4,143)

The sensitivity analysis above may not reflect actual changes in the present value of the defined benefit obligation because the actuarial assumptions may be correlated and changes in only one assumption are not feasible.

assumption are not feasible.
20.
(1)		 Amount expected to be appropriated
within 1 year
Average duration to maturity of
defined benefit obligation
Equity
Share capital - ordinary shares
Authorized number of shares (in
thousands)
Authorized capital
Number of shares issued and fully
paid (in thousands)
Issued shares		 December 31, 2022
$ 2,565
6.71Years~11.80Years
December 31, 2022

157,000
$ 1,570,000

100,000
$ 1,000,000		 December 31, 2021
$ 2,624
7.34Years~12.83Years
December 31, 2021






157,000
$ 1,570,000
100,000
$ 1,000,000

The issued common stock has a par value of $10 per share and each share is entitled to one right to vote and the right to receive dividends. (2) Capital surplus

Capital surplus results from the difference between the actual acquisition or disposal price and the book value of the Company's equity in a subsidiary under equity transactions and from donated assets. (3) Retained earnings and dividend policy

In accordance with the Company's Articles of Incorporation, if the Company made a profit in a fiscal year as concluded by the year-end accounting close, the profit shall be first used for paying taxes, making up for the cumulative losses, setting aside 10% of the remaining profit as a legal reserve unless it has reached the total amount of the Company’s paid-in capital, setting aside an amount for or reversing a special reserve in accordance with laws and regulations, and then any remaining profit, together with any undistributed earnings, shall be adopted by the Company’s Board of Directors as the basis for making a distribution proposal, which shall then be submitted to the shareholders’ meeting for a resolution before distribution of bonuses to shareholders. For the distribution policy on profit-sharing remuneration for employees and directors, see Note 22 (7) on profit-sharing remuneration for employees and directors.

The principle of the Company's dividend policy is to distribute cash dividends and stock dividends in an appropriate mix, and to determine the type, amount and timing of dividends based on the actual profitability, capital budget planning and capital position of the year. The Company shall distribute cash dividends at no less than 10% of the total dividends to be distributed in the year; however, if it has more abundant surplus and capital, it may raise said percentage.

Legal reserve should be appropriated until its balance reaches the Company's total paid-in capital. Legal reserve may be used to make up for losses. If the Company has no loss, the excess of legal reserve over 25% of the total paid-in capital may be distributed in cash in addition to being capitalized as equity. When distributing earnings, the Company is required by law to provide special reserve for the net reduction of other equity items. If the net deduction of other shareholders' equity is subsequently reversed, within the portion of which, special reserve may be reversed for distribution of earnings. The Company held regular shareholders' meetings on June 15, 2022 and July 29, 2021, respectively, and resolved to approve the following distribution proposals for 2021 and 2020 earnings:

Legal reserve
Cash dividends
Cash dividends per share (NTD)		 2021
$ 22,088
$ 190,000
$ 1.9		 2020


$ 18,757
$ 150,000
$ 1.5

154

On March 17, 2023, the Company's Board of Directors proposed to distribute 2022 earnings as follows:

follows:
Legal reserve
Cash dividends
Cash dividends per share (NTD)		 2022


$ 26,506
$ 220,000
$ 2.2

The 2022 earnings distribution proposal is subject to the resolution of the regular shareholders' meeting scheduled for June 13, 2023.

(4) Special reserve

Upon the adoption of IFRSs for the first time, the Group transferred the cumulative translation adjustment of $17,619 thousand on the accounting book to retained earnings, and a special reserve of the same amount was provided.

(5) Other equity interests

  • A. Exchange differences on translation of financial statements of foreign operations
Balance at the beginning of the
year
Translation differences of foreign
operations
Share of affiliates and joint
ventures accounted for using
the equity method
Balance at the end of the year		 2022
$ 20,350 )
9,856
98)
$ 10,592)		 2021
(
(
(		 (
(
(
(		 $ 15,110 )

4,807 )
433)
$ 20,350)
  • B. Unrealized gain or loss on financial assets at fair value through other comprehensive income
Balance at the beginning of the
year
Unrealized gain or loss on
equity instruments arising
during the year
Balance at the end of the year
Non-controlling interests
Balance at the beginning of the year
Net loss for the year
Other comprehensive income for the
year
Exchange differences on
translation of financial
statements of foreign
operations
Remeasurement of defined
benefit plans
Effective acquisition of partial
interest in a subsidiary by the
parent company (Note 12)
Cash dividends from subsidiaries
Balance at the end of the year		 2022
$ 13,429
910
$ 14,339
2022
$ 10,641

5,785 )
106
41
-
35)
$ 4,968		 2021


(

 $ 2,116 )
15,545
$ 13,429
2021

(
(
(
(
(
(
(
 $ 11,803

845 )

68 )

2 )

176 )
71)
$ 10,641
  • (6) Non-controlling interests

155

21. Revenue

Revenue
Sales revenue
Project contract revenue and
merchandise sales revenue
Service revenue
Rental revenue
Equipment rental revenue		 2022
$ 4,583,448
1,349,167
17,909
$ 5,950,524		 2021




$ 4,574,665
1,292,764
2,166
$ 5,869,595

(1) Description of customer contracts Sales revenue

Customer contracts under the project contract revenue are for system integration services based on customization specifications. Revenue is recognized based on the degree of completion of the contracts, and the customer pays the contract consideration according to the contract schedule.

Merchandise sales revenue is recognized when the contractual obligations are met or when the customer has acquired control and use of the merchandises and assumes the risk of the merchandises. Service revenue

Service revenue arises when maintenance services are provided to the customer during the contract period. Part of the consideration is received in advance at the time of signing the contract and revenue is subsequently recognized over the contract period on a straight-line basis.

  • (2) Contract balances
Contract balances
Accounts receivable (Note 10)
Contract assets
System integration services
Less: Allowance for losses
Contract assets - current
Contract liabilities
System integration services		 December 31, 2022
$ 1,489,172
$ 486,381

-
$ 486,381
$ 238,583		 December 31, 2021








$ 1,576,836
$ 359,158
-
$ 359,158
$ 208,240

The changes in contract assets and contract liabilities were mainly due to the difference between the timing of meeting performance obligations and the timing of customer payments. There was no material change in the period except for the adjustment based on the results of completion measurement.

  • (3) Breakdown of customer contract revenue 2022
2022
Type of products or services
Sales revenue

Service revenue

Rental revenue

 Reportable segment
Business segments
of the Company
$ 4,314,490
1,325,870

17,880

$ 5,658,240
 Business segments
of the entities
controlled by the
Company
$ 268,958
23,297

29

$ 292,284
 Total






$ 4,583,448
1,349,167
17,909
$ 5,950,524

156

2021

2021
22.
(1)
(2)
(3)
(4)
(5)		 Reportable segment
Business segments
of the Company
Business segments
of the entities
controlled by the
Company
Type of products or services
Sales revenue
$ 4,307,024 $ 267,641
Service revenue

1,266,905
25,859
Rental revenue

1,514

652

$ 5,575,443
$ 294,152

Net profit for the period
Interest income
2022
Bank deposits
$ 4,043
Other income
2022
Government grants income
$ 39,858
Marketing incentive income
10,563
Rental income
5,716
Others

5,957
$ 62,094
Other gain and loss
2022
Net gain on financial assets at fair
value through profit or loss
$ 432
Gain on disposal of property, plant and
equipment
382
Net foreign currency exchange (loss)
gain
(
10,297 )
Others
(
13,610)
($ 23,093)
Finance costs
2022
Interest on bank loans
$ 6,974
Interest on lease liabilities
850
Others

2
$ 7,826
Depreciation and amortization
2022
Summary of depreciation expenses by
function
Operating costs
$ 21,088
Operating expenses

90,564
$ 111,652
Summary of amortization expenses by
function
Operating expenses
$ 633		 Reportable segment
Total


$ 4,574,665
1,292,764
2,166
$ 5,869,595
2021
$ 4,335
2021


$ 6,712
4,275
5,221
6,502
$ 22,710
2021

(
(		 $ 410
446
2,590
11,798)
$ 8,352)
2021


$ 3,442
1,437
1
$ 4,880
2021



$ 17,124
91,900
$ 109,024
$ 901

157

(6) Employee benefits expenses

Employee benefits expenses
Short-term employee benefits
Salary expenses
Labor and health insurance
expenses
Other employment expenses
Retirement benefits (Note 19)
Defined contribution plan
Defined benefits plan
Total
Summary by function
Operating costs
Operating expenses		 2022
$ 1,420,176
135,709
48,903
1,604,788
58,386
724
59,110
$ 1,663,898
$ 649,936
1,013,962
$ 1,663,898		 2021
















$ 1,318,441
132,384
49,425
1,500,250
56,112
575
56,687
$ 1,556,937
$ 595,499
961,438
$ 1,556,937
  • (7) Profit-sharing remuneration for employees and directors

In accordance with the Company's Articles of Incorporation, if the Company makes a profit in a year, it shall pay profit-sharing remuneration for employees of not less than 3% of the pre-tax profit before paying the profit-sharing remuneration for employees. In accordance with the Board of Directors' resolutions dated March 17, 2023 and March 18, 2022, the Company would pay profit-sharing remuneration for employees at 3.01% of its profit for both of the years 2022 and 2021, in the amount of NT$9,600 thousand and NT$8,450 thousand respectively. The profit-sharing remuneration for directors was not estimated for 2022 and 2021.

Any change in the amount after the approval and announcement of the annual consolidated financial statements will be treated as a change in accounting estimate with an adjustment in the following year.

The actual distribution amounts for profit-sharing remunerations for employees and directors for 2021 and 2020 did not differ from the amounts recognized in the consolidated financial statements for 2021 and 2020.

Please refer to the “Market Observation Post System” of the Taiwan Stock Exchange for information on the Company's profit-sharing remuneration for employees resolved by the Board of Directors in 2023 and 2022.

23. Income tax

  • (1) Major components of income tax expense recognized in profit or loss
2022 2021
Current income tax
Generated during the year $ 59,734
 $ 49,833
Income tax on unappropriated
earnings 161 -
Adjustments for prior years ( 2,072 ) 3,682
Deferred income tax
Generated during the year 1,888
3,365
Income tax expense recognized in
profit or loss $ 59,711
$ 56,880
The reconciliation of accounting income to income tax expense was as follows:
2022 2021
Net profit before tax $ 304,656
$ 271,857
Income tax expense at statutory rate
on net profit before tax $ 55,327
 $ 56,358

158

(2) 2022
Non-deductible expenses for tax
purposes
1,896
Tax-exempt income
(
1,021 )
Income tax on unappropriated
earnings
161
Investment tax credits used in the
year
(
9,428 )
Unrecognized deductible temporary
differences
7,584
Unrecognized loss carryforward
7,264
Adjustments to prior years' current
income tax expense recorded in the
year
(
2,072)
Income tax expense recognized in
profit or loss
$ 59,711
Income tax expense recognized in other comprehensive income
2022
Deferred income tax
Generated during the year
- Remeasurement of defined
benefit plans
$ 3,543		 2021
(
(

 1,756

2,499 )
-

6,199 )
3,783
-
3,681
$ 56,880
2021
$ 1,265

(3) Deferred income tax assets and liabilities The changes in deferred income tax assets and liabilities are as follows: 2022

2022
Deferred income tax assets
Temporary differences
Unrealized loss on decline in value
of inventories
Defined benefits retirement plans

Others

Loss carryforward


Deferred income tax liabilities
Temporary differences
Unappropriated earnings of
subsidiaries and associates
Others

 Balance at the
beginning of the
year		 Recognized in
profit or loss
( $ 1,172 )
(
930 )

1

105

($ 1,996)

$ 162
(
54)

$ 108
 Recognized in
other
comprehensive
income


$ -
(
3,543 )

-

-

($ 3,543)




$ -

-

$ -
 Balance at the end
of the year
$ 1,623

15,754

427

1,400

$ 19,204

( $ 10,578 )
(
660)

($ 11,238)

$ 451

11,281

428

1,505
$ 13,665



( $ 10,416 )
(
714)
($ 11,130)

159

2021

2021
Deferred income tax assets
Temporary differences
Unrealized loss on decline in value
of inventories
Defined benefits retirement plans

Others

Loss carryforward


Deferred income tax liabilities
Temporary differences
Unappropriated earnings of
subsidiaries and associates
Others

 Balance at the
beginning of the
year		 Recognized in
profit or loss
( $ 2 )
(
3,539 )

113

-

($ 3,428)

$ 117
(
54)

$ 63
 Recognized in
other
comprehensive
income


$ -
(
1,265 )

-

-

($ 1,265)




$ -

-

$ -
 Balance at the end
of the year
$ 1,625

20,558

314

1,400

$ 23,897

( $ 10,695 )
(
606)

($ 11,301)

$ 1,623

15,754

427

1,400
$ 19,204



( $ 10,578 )
(
660)
($ 11,238)
  • (4) Deductible temporary differences for deferred income tax assets not recognized in the consolidated balance sheets
balance sheets
Deductible temporary differences December31,2022
$ 335		 December31,2021
$ 335

(5) Status of income tax assessment

The Company's and subsidiaries’ income tax returns have been assessed by the tax authorities as shown below:

shown below:
Name ofthe company
The Company
Netmaker Technology Co., Ltd.
Wisemaker Technology Co.
Coach Technology Management Inc.		 Yearofassessment
2020
2020
2020
2021
  1. Earnings per share

The earnings and weighted-average number of shares of common stock used in the calculation of earnings per share were as follows:

Net profit for the year

earnings per share were as follows:
Net profit for the year
The net profit used in the calculation of
basic earnings per share
The net profit used in the calculation of
diluted earnings per share
Number of shares
The weighted-average number of shares
of common stock used in the
calculation of basic earnings per share
Impact of potential common stock with
dilutive effect:
Profit-sharing remuneration for
employees
The weighted-average number of shares
of common stock used in the
calculation of diluted earnings per
share		 2022
2021
$ 250,730
$ 215,822
$ 250,730
$ 215,822
Unit: Thousands of shares
2022
2021
100,000
100,000
447

369
100,447

100,369		 2021



100,000
369
100,369

160

If the Group may choose to have the employee compensation distributed via a stock or cash dividend, the calculation of the diluted earnings per share assumes that the bonus to employees is with a stock dividend distributed, with the weighted average number of shares outstanding included when the potential common stock has a diluted effect. The dilutive effect of these potential common shares also continues to be considered in the calculation of diluted earnings per share before the number of shares awarded to employees in the following year's resolution.

25. Capital risk management

The Group conducts capital management to ensure that the Group's enterprises can continue to operate while maximizing shareholder returns by optimizing debt and equity balances. The overall strategy of the Consolidated Company has not changed since 2013.

The capital structure of the Group is composed of net debt (i.e., borrowings less cash and cash equivalents) and equity (i.e., capital stock, capital surplus, retained earnings, other equity items and noncontrolling interests) of the Consolidated Company.

The Group is not subject to other external capital requirements.

The Group's key management reviews the Group's capital structure annually, which includes consideration of the cost of each type of capital and the related risks. The Group will balance its overall capital structure by paying dividends, adding or repaying loans, as recommended by key management.

26. Financial instruments

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

The management of the Group considers that the carrying amounts of financial assets and financial liabilities that are not measured at fair value approximate their fair values, and therefore the carrying amounts of the Consolidated Balance Sheets are a reasonable basis for estimating fair values.

  • (2) Fair value information - financial instruments measured at fair value on a recurring basis Fair value hierarchy December 31, 2022
Fair value hierarchy
December 31, 2022
Level 1
Level 2
Level3
Financial assets at fair value through
profit or loss

Fund beneficial certificates
$ 19,956
$ -
$ -


Financial assets at fair value through
other comprehensive income

Investments in equity instruments

- Domestic listed stocks
$ 24,142 $ - $ -
- Domestic unlisted stocks

-

-

1,595

Total
$ 24,142
$ -
$ 1,595

December 31, 2021
Level 1
Level 2
Level3
Financial assets at fair value through
profit or loss

Fund beneficial certificates
$ 235,009
$ -
$ -


Financial assets at fair value through
other comprehensive income

Investments in equity instruments

- Domestic listed stocks
$ 20,853 $ - $ -
- Domestic unlisted stocks

-

-

1,595

Total
$ 20,853
$ -
$ 1,595

There were no transfers between Level 1 and Level 2 fair value measurements in 2022		 Total







$ 19,956
$ 24,142
1,595
$ 25,737
Total

$ 235,009



$ 20,853

1,595
$ 22,448
and 2021.
  • (3) Type of financial instruments
Type of financial instruments
Financial assets
Financial assets mandatorily measured
at fair value through profit or loss
Financial assets at amortized cost
(Note 1)		 December 31, 2022
$ 19,956
2,430,681		 December 31, 2021
$ 235,009
2,390,267

161

Investments in equity instruments
designated as at fair value through
other comprehensive income
Financial liabilities
Measured at amortized cost (Note 2)		 December 31, 2022
25,737
1,989,268		 December 31, 2021
22,448
1,833,024

  • Note 1: The balance includes financial assets measured at amortized cost, such as cash and cash equivalents, investments in debt instruments, notes receivable, accounts receivable, and other receivables.

  • Note 2: The balance includes financial liabilities measured at amortized cost, such as short-term loans, notes payable, accounts payable and other payables.

  • (4) Financial risk management objectives and policies

The Group's major financial instruments include investments in equity and debt instruments, accounts receivable, accounts payable, borrowings and lease liabilities. The Group's financial management department provides services to each business unit, coordinates access to domestic and international financial markets, and monitors and manages financial risks associated with the Group's operations through internal risk reporting that analyzes risk exposure based on risk level and breadth. These risks include market risk (including exchange rate risk and interest rate risk), credit risk and liquidity risk.

A. Market risk

The main financial risks to which the Group is exposed as a result of the Group's operating activities are the risk of changes in foreign currency exchange rates (see a. below) and the risk of changes in interest rates (see b. below).

  • a. Exchanger rate risk

  • The Group engages in foreign currency-denominated sales and purchases

  • transactions, which expose the Group to exchange rate fluctuations.

The carrying amounts of monetary assets and monetary liabilities that are not denominated in the functional currency as of the balance sheet date are disclosed in Note 30.

Sensitivity analysis

The Group is mainly affected by the fluctuation of USD exchange rate.

The following describes the sensitivity analysis of the Group when the exchange rate of NTD (functional currency) increases and decreases by 10% against the relevant foreign currencies. 10% is the sensitivity percentage used for the Group’s internal reporting of exchange rate risk to key management and represents management's assessment of the reasonably possible range of changes in foreign currency exchange rates. The sensitivity analysis includes only foreign currency monetary items in circulation and adjusts their translation at the end of the period by a 10% change in the exchange rate. The 10% appreciation of the NTD against USD will increase net profit before tax by $9,995 thousand and $19,330 thousand in 2022 and 2021, respectively. If NTD depreciates by 10% against each of the relevant foreign currencies, the effect on net profit before tax will be the negative number for the same amount. The effect of the above exchange rate fluctuations mainly arises from foreign currency cash, accounts payable and foreign currency borrowings of the Group that are outstanding at the balance sheet date and not covered by cash flow hedge.

  • b. Interest rate risk

The entities within the Group borrow funds at both fixed and floating interest rates, which results in interest rate risk. The Group manages interest rate risk by maintaining an appropriate borrowing mix of fixed and floating interest rates.

The carrying amounts of the Group's financial assets and financial liabilities exposed to interest rate risk as of the balance sheet date were as follows:

162

With fair value interest rate
risk
- Financial assets
- Financial liabilities
With cash flow interest rate
risk
- Financial assets
- Financial liabilities		 December 31, 2022
$ 633,596
45,439
293,368
156,422		 December 31, 2021
$ 416,547
66,082
380,437
137,726

Sensitivity analysis

The following sensitivity analysis was determined based on the interest rate risk of the non-derivative instruments at the balance sheet date. For floating rate liabilities, the analysis assumes that the amount of the liability outstanding at the balance sheet date is outstanding in the reporting period. The rate of change used in the Group’s reporting interest rates internally to key management is a 25 basis point increase or decrease in interest rates, which also represents management's assessment of the range of reasonably possible changes in interest rates.

If the interest rate increases/decreases by 25 basis points, with all other variables held constant, the Group's net profit before tax for 2022 and 2021 would increase/decrease by $342 thousand and $607 thousand, respectively.

  • B. Credit risk

Credit risk refers to the risk of the Group’s financial loss resulting from the counterparties' default on contractual obligations. As of the balance sheet date, the Group's maximum exposure to credit risk of financial loss due to non-performance of counterparties' obligations and financial guarantees provided by the Group mainly arises from the carrying amount of financial assets recognized in the Consolidated Balance Sheet.

Before accepting a new customer, the Group assesses the credit quality of the potential customer and sets the credit limit of the customer through its internal credit and related sales management departments, and the credit limit and rating of the customer are reviewed annually. C. Liquidity risk

The Group manages and maintains a sufficient portion of cash and cash equivalents to support the Group's operations and mitigate the impact of cash flow fluctuations. The Group's management monitors the use of banking facilities and ensures compliance with the terms of borrowing contracts.

Bank loans are an important source of liquidity for the Group. As of December 31, 2022 and 2021, the Group had unused financing facilities as described in b. Description of financing facilities below.

  • a. Liquidity and interest rate risk of non-derivative financial liabilities

The analysis of the remaining contractual maturities of non-derivative financial liabilities is prepared based on the undiscounted cash flows (including principal and estimated interest) of financial liabilities based on the earliest possible date on which the Group could be required to make repayment. Accordingly, the Group's bank loans that may be required to be repaid immediately are listed in the table below for the earliest period, without considering the probability that the bank will immediately enforce the right; the maturity analysis of other non-derivative financial liabilities is prepared based on the contractual repayment dates.

December 31, 2022

==> picture [354 x 85] intentionally omitted <==

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

Payment on
demand or less than
1 month 1 ～ 3 months 3 months ～ 1 year 1 ～ 5 years More than 5 years
Non-derivative financial
liabilities
Non-interest-bearing
liabilities $ - $ 1,807,257 $ - $ - $ -
Lease liabilities 836 1,672 6,497 12,714 -
Floating rate instruments 810 84,349 74,291 - -
Fixed rate instruments 6,541 18,051 - - -
$ 8,187 $ 1,911,329 $ 80,788 $ 12,714 $ -
----- End of picture text -----

Further information on the maturity analysis of lease liabilities is as follows:

163

Lease liabilities
December 31, 2021
d
Non-derivative financial
liabilities
Non-interest-bearing
liabilities

Lease liabilities

Floating rate instruments


Further information
Lease liabilities		 Less than 1 year
1 to 5 years
5 to 10 years
$ 9,005
$ 12,714
$ -
Payment on
emand or less than
1 month
1～3 months
3 months～1year
1～5years
Morethan5 years

$ - $ 1,694,890 $ - $ - $ -
3,882
7,764
34,964
20,826
169
5,264

99,838

33,301

-

-
$ 9,146
$ 1,802,492
$ 68,265
$ 20,826
$ 169
on the maturity analysis of lease liabilities is as follows:
Less than 1 year
1 to 5 years
5 to 10 years
$ 46,610
$ 20,826
$ 169		 Less than 1 year
1 to 5 years
5 to 10 years
$ 9,005
$ 12,714
$ -
Payment on
emand or less than
1 month
1～3 months
3 months～1year
1～5years
Morethan5 years

$ - $ 1,694,890 $ - $ - $ -
3,882
7,764
34,964
20,826
169
5,264

99,838

33,301

-

-
$ 9,146
$ 1,802,492
$ 68,265
$ 20,826
$ 169
on the maturity analysis of lease liabilities is as follows:
Less than 1 year
1 to 5 years
5 to 10 years
$ 46,610
$ 20,826
$ 169		 Less than 1 year
1 to 5 years
5 to 10 years
$ 9,005
$ 12,714
$ -
Payment on
emand or less than
1 month
1～3 months
3 months～1year
1～5years
Morethan5 years

$ - $ 1,694,890 $ - $ - $ -
3,882
7,764
34,964
20,826
169
5,264

99,838

33,301

-

-
$ 9,146
$ 1,802,492
$ 68,265
$ 20,826
$ 169
on the maturity analysis of lease liabilities is as follows:
Less than 1 year
1 to 5 years
5 to 10 years
$ 46,610
$ 20,826
$ 169		 5 to 10 years 5 to 10 years 5 to 10 years

years		 $ -
Morethan5 years
$
$
$ 169

The amount of floating rate instruments for the above non-derivative financial assets and liabilities will vary depending on the difference between the floating rate and the interest rate estimated at the balance sheet date.

b.

Financing facilities

Financing facilities
Secured bank financing
facilities
- Amount drawn
- Amount undrawn
Unsecured bank financing
facilities (revisited
annually)
- Amount drawn
- Amount undrawn		 December 31, 2022
$ -

-
$ -
$ 610,515

1,685,614
$ 2,296,129		 December 31, 2021










$ -
40,000
$ 40,000
$ 478,101
1,992,802
$ 2,470,903

27. Related Party Transactions

The transactions, account balances, revenues and expenses between the Company and its subsidiaries (which are related parties of the Company) are eliminated upon consolidation and are not disclosed in this note. In addition to those disclosed in other notes, the transactions between the Group and its related parties were as follows.

  • (1) Names of related parties and the relationships

Name of related party Relationship with the Consolidated Company Furly Investment Co., Ltd. Investor with material influence Chuan Gao Investment Co., Ltd. Investor with material influence Welida Investment Co., Ltd. Substantive related party DBMaker Japan Inc. Associate Cloudmaster Co., Ltd. Joint venture

  • (2) Operating revenue (including sales, services and rental)
Type of related party
Associate
Joint venture		 2022
$ 23,658
143
$ 23,801		 2021




$ 32,382
782
$ 33,164

164

(3) Operating costs (including sales, services and rental)
Type of related party 2022 2021
Associate
 $ 9,580 $ 2,171
Joint venture
 2,669 779
$ 12,249 $ 2,950
Associate
$ 9,580
Joint venture

2,669
$ 12,249		 Associate
$ 9,580
Joint venture

2,669
$ 12,249		 Associate
$ 9,580
Joint venture

2,669
$ 12,249		 $
$		 2,171
779
2,950
(4) Amounts due from related parties (excluding loans to related parties)
Account on the
financial statements Type of related party December 31, 2022 December 31, 2021
Accounts receivable Associate
$		 2,798
$		 9,665
Joint venture 72 -


$
2,870

$		 9,665

The outstanding receivables from related parties were not guaranteed. No allowance for losses was provided for the amounts due from related parties in 2022 and 2021.

  • (5) Amounts due to related parties (excluding loans from related parties) Account on the
Account on the
financial statements
Accounts payable


 Type of related party
Associate

Joint venture

Investor with material
influence
 December 31, 2022
$ 2,151

1,473

10

$ 3,634		 December 31, 2021

$ -
1,021
8
$ 1,029

The balance of outstanding payables to related parties was not guaranteed.

  • (6) Acquisition of property, plant and equipment
(6)
Acquisition of property, plant and equipment
Acquisition price
Type of related party
2022
2021
Associate
$ 7,660
$ 7,104

(7)
Lease agreement with the Group as the lessee
Account on the
financial
statements
Name
December 31, 2022
December 31, 2021
Lease liabilities
Chuan Gao Investment Co., Ltd.
$ 5,758

$ 28,709
Furly Investment Co., Ltd.


-


15,391

$ 5,758

$ 44,100
Name
2022
2021
Finance costs
Chuan Gao Investment Co., Ltd.
$ 237
$ 576
Furly Investment Co., Ltd.

106

335
$ 343
$ 911
(8)
Rental expenses
Account on the
financial
statements
Name
2022
2021
Operating
expenses
Furly Investment Co., Ltd.

$ 1,601

$ 1,346
Chuan Gao Investment Co., Ltd.
2,709

788
Substantive related party


72


1983
$ 4,382
$ 2,206		 Acquisition price
2021
$ $ 7,104
December 31, 2021


$ 28,709
15,391
$ 44,100
2021


$



$
576
335

911
2021
$ $


$ 1,601
2,709
72
$ 4,382

$ 1,346
788
1983
$ 2,206

165

(9)
(10)		 Rental income
Account on the
financial
statements
Name
Other income
Cloudmaster Co., Ltd.
Salaries for key management
Short-term employee benefits
Retirement benefits		 Name

2022		 2022 2021
$ 1,457
2021




$ 284,878
11,414
$ 296,292

Salaries for directors and other key management personnel are determined by the Remuneration Committee based on individual performance and market trends.

28. Assets Pledged as Collateral

The following assets were pledged as collateral for system design contract performance, guarantee facilities and bank loan facilities:

facilities and bank loan facilities:
Time deposits pledged (recorded as
financial assets at amortized cost)
Property, plant and equipment - net		 December 31, 2022
$ 231,060

-
$ 231,060		 December 31, 2021




$ 235,660
74,597
$ 310,257

29. Significant Contingent Liabilities and Unrecognized Commitments

As of December 31, 2022, the Group's guarantee notes payable for project contracts and letters of guarantee issued by banks amounted to $ 146,113 thousand and $429,593 thousand, respectively.

  1. Foreign-currency-denominated Assets and Liabilities that have Significant Influence The following information is presented in foreign currencies other than the functional currency of each entities of the Group and the exchange rates disclosed are the rates at which the foreign currencies were translated into the functional currency. Information on foreign currency assets and liabilities with significant effect:

December 31, 2022

effect:
December 31, 2022
Foreign currency assets
Monetary item
USD
Non-monetary item
JPY
Foreign currency
liabilities
Monetary item
USD
December 31, 2021
Foreign currency assets
Monetary item
USD
Non-monetary item
JPY
Foreign currency
liabilities
Monetary item
USD		 Foreign currency
$ 3,012
66,636
$ 6,266
Foreign currency
$ 565
50,642
7,548		 Exchange rate
30.71
0.2324
30.71
Exchange rate
27.68
0.2405
27.68		 Carrying amount
$ 92,484
15,486
$ 192,435
Carrying amount
$ 15,629
12,179
208,931

166

Foreign currency exchange gain and loss (realized and unrealized) with material effect are as follows:

Foreign currency
USD

USD
 2022 2021
Net exchange
(loss) gain
Exchange rate

$ 1,789 28.009 (USD: NTD)

(
11,877 ) 6.4512 (USD: RMB)		 2021
Exchange rate

29.805(USD: NTD)

6.7208(USD: RMB)
 Net exchange
(loss) gain
( $ 126 )
2,806

  1. Separately Disclosed Items

  2. (1) Information on significant transactions and investees

    • A. Lending of funds to others: None

    • B. Endorsement and guarantee for others. (Exhibit 1.)

    • C. Marketable securities held at the end of the period (excluding investment in the equities of subsidiaries, affiliates and joint ventures). (Exhibit 2.)

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

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

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

    • G. The purchase or sale with the related party for an amount exceeding NT$100 million or 20% of paid-in capital: None

    • H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more. None. I. Engagement in derivative transactions: None.

    • J. Others: Business relationships and significant inter-company transactions between parent and subsidiary and between subsidiaries. (Exhibit 3.)

    • K. Information on investees (Exhibit 4.)

  3. (2) Information on investments in Mainland China:

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

    • B. The following significant transactions with investees in Mainland China, directly or indirectly through third regions, and their prices, payment terms, and unrealized gains or losses: None

      • a. Amount and percentage of purchases and related payables at the end of the period.

      • b. Amount and percentage of sales and related receivables at the end of the period.

      • c. Amount of property transaction and amount of the profit or loss so incurred.

      • d. Balance and purpose of endorsement and guarantee or collateral provided at end of the period.

      • e. Maximum balance, ending balance, interest rate range and total current interest amount of financial accommodation.

      • f. Other transactions that have a significant effect on the current profit or loss or financial position, such as the provision or receipt of services.

  4. (3) Information on major shareholders: Name, number and percentage of shares held by shareholders with 5% or more of the ownership. (Exhibit 6)

32. Segment Information

The information provided to the chief business decision maker for allocating resources and measuring segment performance focuses on the type of product or service delivered or provided. The Group 's reportable segments are the operating segments of the Company and the entities controlled by the Company.

(1) Segment revenue and operating results

Reportable segment
Business segments of
the Company

Business segments of
the entities
controlled by the
Company
 Segment revenue
2021
$ 5,578,076

354,799		 Segment profit or loss Segment profit or loss
2022
$ 5,674,679

360,533		 2022

$ 291,698

(
30,128 )		 2021
$ 283,481
(
31,810 )

167

Elimination of inter-
segment revenue

Total of reportable
segments

Non-operating income and
expense
Net profit before tax		 Segment r eve nue
2021

63,280)

$ 5,869,595


 Segment profit Segment profit or loss
2022

84,688)

$ 5,950,524
 2022
2,835

264,405

40,251

$ 304,656
 2021
(
 (



3,155
254,826
17,031
$ 271,857

The above reported revenues were generated from external customers and inter-segment transactions.

(2) Total segment assets and liabilities

Total segment assets and liabilities
Segment assets
Business segments of the Company
Business segments of the entities
controlled by the Company
Total
Segment liabilities
Business segments of the Company
Business segments of the entities
controlled by the Company
Total		 December 31, 2022
$ 4,025,953

408,987
$ 4,434,940
$ 2,097,252

282,875
$ 2,380,127		 December 31, 2021





$ 3,820,707
413,622
$ 4,234,329
$ 1,958,246
301,326
$ 2,259,572
  • (3) Region information The Group operates mainly in four regions - Taiwan, China, the United States and Southeast Asia.

Information on the Group's operating revenue from external customers and non-current assets by region is presented below:

Taiwan

China

U.S.A.

Southeast Asia

 Revenuefromexternalcustomers
2022
2021

$ 5,799,879
$ 5,690,206

139,888

169,793

7,517
5,493
3,240

4,103

$ 5,950,524
$ 5,869,595
 Revenuefromexternalcustomers
2022
2021

$ 5,799,879
$ 5,690,206

139,888

169,793

7,517
5,493
3,240

4,103

$ 5,950,524
$ 5,869,595
 Non-current assets Non-current assets Non-current assets
2022
$ 5,799,879

139,888

7,517
3,240

$ 5,950,524
 December 31, 2022
$ 394,083


15,698

21,038

1,257

$ 432,076
December 31, 2021














$ 435,139
21,801
19,555
1,357
$ 477,852

Non-current assets do not include non-current assets held for sale, financial instruments, deferred income tax assets, and net defined benefit assets.

(4) Information on major customers Revenue from system design, integration and maintenance in 2022 and 2021: $5,950,524 and $5,869,595 thousand, where $892,328 and $952,687 thousand were from the largest customer of the Group.

168

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Endorsement and guarantee for others 2022

Endorsement and guarantee for others
2022		 Endorsement and guarantee for others
2022
Exhibit 1 (In Thousands of New Taiwan Dollars/foreign currency, Unless Stated Otherwise)
No. Name of the
company
providing
endorsement and
guarantee		 Partyendorsed andguaranteed Limit on the
endorsement and
guarantee for a single
enterprise		 Balance of the
maximum
endorsement and
guarantee for the
period		 Balance of
endorsement and
guarantee at the end of
the period (Note1)
Actual amount drawn		 Amount of
endorsement and
guarantee by property		 Percentage of
cumulative
endorsement
and guarantee
to net worth of
the most recent
financial
statements (%)		 Limit on the
maximum
endorsement and
guarantee		 Endorsement
and guarantee
by parent
company for
subsidiary		 Endorsement
and guarantee
by subsidiary
for parent
company		 Endorsement
and guarantee
for Mainland
China

Name of the company		 Relationship
0 The Company Syscom Computer (Shenzhen)
Co., Ltd.
Xian Linan Computer Co.,
Ltd.
Netmaker Technology Co.,
Ltd.
Coach Technology
Management Inc.
Sub-
subsidiary
Sub-
subsidiary
Subsidiaries
Subsidiaries		 20% of the net worth
on the Company's
financial statements
for the most recent
period
$ 409,969
Same as above
Same as above
Same as above		 $ 334,739
( USD
10,900 )

60,652
( USD
1,975 )
90,000
15,000		 $ 334,739
( USD
10,900 )
60,652
( USD
1,975 )
85,000
15,000		 $ 138,195
( USD
4,500 )
18,426
( USD
600 )
36,015
-		 $ -
-
-
-		 16.33
2.96
4.15
0.73		 50% of the net worth
on the Company's
financial statements
for the most recent
period
$1,024,923

Same as above
Same as above
Same as above		 Yes

Yes
Yes
Yes		 No
No
No
No		 Yes
Yes
No
No

Note 1: The balance of endorsement and guarantee at the end of the period includes $18,426 thousand from Xian Linan Computer Co., Ltd., whose endorsement and guarantee duration has been approved to be extended in advance in accordance with the Company Rules Governing Endorsement and Guarantees.

Note 2: Amounts in foreign currencies were translated into NTD at the exchange rate as of December 31, 2022.

169

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Marketable securities held at the end of the period December 31, 2022

Exhibit 2

(In Thousands of New Taiwan Dollars /Thousands of Shares (Thousands of Units))

Company held Type and name of marketable securities Relationship with the issuer of
marketable securities		 Account on the financial statements End of the period Remark
Number of
shares/units		 Carrying amount Shareholding
percentage %		 Fair value
SYSCOM COMPUTER
ENGINEERING CO.
Coach Technology Management Inc.		 Beneficial certificates
Yuanta Global Quality Leader Balanced
Fund - NTD Class A No-
Dividends/Interests
Stocks
Engsound Technical Enterprise Co.,
Ltd.
Turn Cloud Technology Service Inc.
Shin Kong Financial Holding Co., Ltd.
Dimension Computer Technology Co.,
Ltd.
Beneficial certificates
Fuh Hwa Money Market Fund		 －
－
－
－
－
－		 Financial assets at fair value through profit or
loss - current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through profit or
loss-current		 1,966
273
195
166
2
31		 $ 19,505

1,595

22,650

1,457

35

451		 -
9.09
1.00
-
-
-		 $ 19,505
1,595
22,650
1,457
35
451

Note 1: Marketable securities referred to here are stocks, bonds, beneficiary certificates and marketable securities derived from the above items that fall within the scope of IFRS 9, "Financial Instruments". Note 2: The above stocks or beneficiary certificates were not pledged as collateral.

170

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

Business relationships and significant inter-company transactions between parent and subsidiary and between subsidiaries 2022

Exhibit 3

(In Thousands of New Taiwan Dollars)

No. Name of the trader Counterparty of the transaction Relationship with the
trader
(Note)		 Transactiondetails Transactiondetails
Account on the financial statements Amount Trading terms As a percentage of
consolidated total revenue
or total assets
0 The Company
The Company
The Company
The Company
The Company
The Company
The Company
The Company
The Company
The Company
The Company
The Company
The Company		 Netmaker Technology Co.
Netmaker Technology Co.
Netmaker Technology Co.
Netmaker Technology Co.
Netmaker Technology Co.
Netmaker Technology Co.
Netmaker Technology Co.
Netmaker Technology Co.
Wisemaker Technology Co.
Wisemaker Technology Co.
Wisemaker Technology Co.
Wisemaker Technology Co.
Wisemaker Technology Co.		 1
1
1
1
1
1
1
1
1
1
1
1
1		 Accounts receivable
Prepayment for purchases
Accounts payable
Sales revenue
Maintenance revenue
Cost of goods sold
Maintenance costs
Miscellaneous expenses
Accounts payable
Rental income
Cost of goods sold
Maintenance costs
Miscellaneous expenses		 $ 15,075
11,986
21,751
14,313
2,491
22,709
8,006
4,811
4,330
1,479
20,729
9,685
2,253		 General trading terms
General trading terms
General trading terms
General trading terms
General trading terms
General trading terms
General trading terms
General trading terms
General trading terms
General trading terms
General trading terms
General trading terms
General trading terms		 -
-
-
-
-
-
-
-
-
-
-
-

Note: 1.Parent company to subsidiary. 2.Subsidiary to subsidiary.

171

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Information on investees, locations, ......, etc.

2022

Exhibit 4

(In Thousands of New Taiwan Dollars/Thousands of Shares, Unless Stated Otherwise)

Name of the investor company Name of the investee Location Principal business Original investment amount Original investment amount Holdingat the end of theperiod Holdingat the end of theperiod Holdingat the end of theperiod Profit (loss) for the
period of the investee
(Note)		 Investment income (loss)
recognized in the period		 Remark
End of the period End of last year Number of
shares		 Shareholding
%		 Carrying amount
SYSCOM COMPUTER
ENGINEERING CO.
Coach Technology
ManagementInc.		 Coach Technology Management Inc.
Casemaker Inc.
SYSCOM INTERNATIONAL INC.
Netmaker Technology Co., Ltd.
Wisemaker Technology Co.
DBMaker Japan, Inc.
Syscom Computer(Thailand)Co., Ltd.
Cloudmaster Co., Ltd.
Syscom Computer(Thailand)Co., Ltd.		 Taipei City
California,
U.S.A.
Cayman
Islands
Taipei City
Taipei City
Tokyo, Japan
Thailand
Taipei City
Thailand		 Diagnostic consulting for corporate
management, domestic and foreign
investment referral, and computerized
design consulting.
Sales of computer software, hardware and
related products.
Investments in other businesses
Information software, data processing and
electronic information supply services
Sales of computer software, hardware and
related products.
Development and sales of computer system
software and hardware
Development and maintenance of software
and other businesses
Information software, data processing and
electronic information supply services
Development and maintenance of software
and otherbusinesses		 $ 19,200
USD
1,300
USD
6,050
18,763
41,697
JPY
53,260
THB
33,014
65,000
THB
200		 $ 19,200
USD
1,300
USD
6,050
18,763
41,697
JPY
53,260
THB
33,014
65,000
THB
200		 1,950
1,300
6,050
2,858
2,665
5
3,400
6,500
20		 97.50
100.00
100.00
86.60
98.72
49.89
91.40
50.00
0.54		 $ 4,331
98,578
(
71,381 )
39,271
58,256
15,486
3,105
54,032
18		 ( $ 368 )
(
4,448 )
(
39,020 )
(
174 )

2,909

7,294
(
311)

2,789
(
311)		 ( $ 359 )
(
4,448 )
(
39,020 )
(
151 )

2,871
3,639
(
284)


1,394
Not applicable		 Subsidiaries
Subsidiaries
Subsidiaries
Subsidiaries
Subsidiaries
Investee accounted for
using the equity
method
Subsidiaries
Investee accounted for
using the equity
method
Subsidiary

Note: The profit or loss of investees was expressed in NTD at the average exchange rate of 2022.

172

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Information on investments in Mainland China 2022

2022 2022
Exhibit 5 (In Thousands of New Taiwan Dollars/foreign currency)
Name of the investee in
Mainland China		 Principal business Paid-in capital Investment method Accumulated investment
amount remitted from
Taiwan at the beginning
of the period		 Investment amount remitted back or
recovered during the period		 Accumulated investment
amount remitted from
Taiwan at the end of the
period		 Profit or losses of the
investee for the period		 Shareholding
percentage of
the Company's
direct or indirect
investment
Investment gain or
loss recognized for the
period
Carrying amount of
the investment at the
end of the period		 Investment income
remitted back as of the
end of the period
Remark
Outward
remittance		 Recovery
Syscom
Computer(Shenzhen)C
o., Ltd.
Xian Linan Computer Co.,
Ltd.		 Computer equipment
software development,
sales of self-developed
technical achievements
services, computer
system integration and
network wiring
engineering.
Development and
production of computer
equipment and computer
software, computer
system integration
network construction,
sales of self-produced
products, and provision
of after-sales technical
services.		 $ 138,195
( USD
4,500 )

70,633
( USD
2,300 )		 Note 1
Note 1		 $ 128,061
( USD
4,170 )
46,618
( USD
1,518 )		 $ -
-		 $ -
-		 $ 128,061
( USD
4,170 )
46,618
( USD
1,518 )		 ( $ 27,402 )
(( USD
919 ))
(Note 2)
(
20,648 )
( (USD
693 ))
(Note 2)		 98.27%
74.38%		 ( $ 26,927 )
( (USD
903 ))
(Note 2)
(
15,358 )
( (USD
515 ))
(Note 2)		 ( $ 73,120 )
( (USD
2,381 ))
(Note 2)
(
2,746 )
( (USD
89 ))
(Note 2)		 $ -
-

Cumulative amount of investment remitted from Taiwan Investment amount approved by the Investment Limit on investments in Mainland China imposed by the Investment Commission of the Ministry of Economic to Mainland China at the end of the period Commission of the Ministry of Economic Affairs Affairs (Note 3)

$ 174,678 $ 174,678 ( USD 5,688 ) ( USD 5,688 ) (Note 1(2)) $ 1,220,907 13,396 ( USD 436 ) (Note 1(1))

Note 1: Investment methods are classified into the following two categories:

(I) The investment was made through the Company's 100%-owned subsidiary, Casemaker Inc.'s own capital and capital increase from capital surplus of the investee.

(II) Indirect investment through the Company's 100%-owned subsidiary SYSCOM INTERNATIONAL INC.

Note 2: Recognized on the basis of the financial statements for the year ended December 31, 2022, as reviewed by CPAs.

Note 3: The calculation of the limit in accordance with the "Regulations Governing the Examination of Investment or Technical Cooperation in Mainland China" of the Investment Commission is as follows: 60% of the net worth: $2,049,845×60% ＝ $1,229,907

Note 4: Amounts in foreign currencies were translated into NTD at the exchange rates as of December 31, 2022, except for profit or loss, which was translated at the average exchange rate for 2022.

173

SYSCOM COMPUTER ENGINEERING CO. Information on major shareholders December 31, 2022

Exhibit 6

Exhibit 6
Name of major shareholder Shareholding
Number of shares held Shareholding
percentage
Jui-Fu Liu
Kuan-Po Ding
Furly Investment Co., Ltd.
Su-Chen Yang
Chi-Shan Liu		 18,346,787
9,890,000
8,529,801
8,524,001
7,598,911		 18.34%
9.89%
8.52%
8.52%
7.59%

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

174

  • V. Parent company only financial statements for the most recent years audited and attested by CPAs

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Syscom Computer Engineering Company

Opinion

We have audited the accompanying financial statements of Syscom Computer Engineering Company (the “Corporation”), which comprise the balance sheets as of December 31, 2022 and 2021, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the reports of other auditors (refer to Other Matter section), the accompanying financial statements present fairly, in all material respects, the financial position of the Corporation as of December 31, 2022 and 2021, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended December 31, 2022. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matters of the financial statements of the Corporation for the year ended December 31, 2022 are stated as follows:

Recognition of Contract Revenue

The Corporation generates revenue through rendering of services according to contract. Revenue from contract is recognized by reference to the stage of completion of contract activity. The stage of completion of the contract is measured based on the proportion of contract cost incurred for

175

work performed to date relative to the estimated total contract cost. The management estimates total contract cost upon signing of the contract. However, the estimated total cost may change as the contract activity progresses and such change may have material impact on revenue recognition; therefore, the recognition of contract revenue is deemed to be a key audit matter.

We focused on the measurement of stage of completion while testing the recognition of contract revenue. The procedures we performed are the following:

  1. We examined the underlying documents of original contract and related addendum used as basis for contract revenue recognized.

  2. We verified the accuracy of accumulated incurred cost through test of details.

  3. We assessed the appropriateness of underlying information and assumptions the management used in estimating total cost.

  4. We performed retrospective review of discrepancy between actual costs incurred and estimated total cost of completed contract.

Please refer to Notes 4 and 5 to the accompanying financial statements for related disclosure on revenue recognition.

Other Matter

The financial statements as of and for the years ended December 31, 2022 and 2021 of some investees in which the Corporation had equity-method investments were audited by other auditors. Our opinion, insofar as it relates to the amounts included in the accompanying financial statements for these investees, is based solely on the reports of the other auditors. As of December 31, 2022 and 2021, the aforementioned investments accounted for using equity method amounted to NT$203,541 thousands and NT$197,567 thousands, which were 5% of total assets of the Corporation. For the years ended December 31, 2022 and 2021, investment income from the aforementioned equity-method investments amounted to NT$(2,371) thousands and NT$5,662 thousands, which represented (0.8%) and 2.1% of total comprehensive income of the Corporation.

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

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

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

Those charged with governance, including the Audit Committee, are responsible for overseeing the Corporation’s financial reporting process.

176

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an 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 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 financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

  2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control.

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

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

  5. Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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

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

177

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements for the year ended December 31, 2022 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Hsin-Wei Tai and Pei-De Chen.

Deloitte & Touche Taipei, Taiwan Republic of China

March 17, 2023

Notice to Readers

The accompanying financial statements are intended only to present the 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 financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. 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 financial statements shall prevail.

178

SYSCOM COMPUTER ENGINEERING CO.

BALANCE SHEETS

DECEMBER 31, 2022 AND 2021

(In Thousands of New Taiwan Dollars)

Code

1100
1110
1136
1140
1150
1172
1200
130X
1410
1479
11XX

1517
1535
1550
1600
1755
1821
1840
1990
15XX
1XXX

Code

2130
2150
2170
2200
2230
2280
2399
21XX

2572
2580
2640
2645
2670
25XX
2XXX

3100
3200
3310
3320
3350
3300
3400
3XXX
 ASSETS
CURRENT ASSETS
Cash and cash equivalents (Notes 4 and 6)
Financial assets at fair value through profit or loss - current (Notes 4
and 7)
Financial assets at amortized cost - current (Notes 4, 9 and 26)
Contract assets - current (Notes 4 and 19)
Notes receivable (Note 4)
Accounts receivable (Notes 4, 10, and 25)
Other receivables (Note 4)
Inventories (Notes 4 and 11)
Prepayments
Other current assets
Total current assets
NON-CURRENT ASSETS
Financial assets at fair value through other comprehensive income -
non-current (Notes 4 and 8)
Financial assets at amortized cost - non-current (Notes 4, 9, and 26)
Investments accounted for using the equity method (Notes 4 and 12)
Property, plant and equipment (Notes 4, 13, 25 and 26)
Right-of-use assets (Notes 4 and 14)
Intangible assets (Notes 4 and 15)
Deferred tax assets (Notes 4 and 21)
Other non-current assets (Note 4)
Total non-current assets
TOTAL
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Contract liabilities - current (Notes 4 and 19)
Notes payable
Accounts payable (Note 25)
Other payables (Note 16)
Current tax liabilities
Lease liabilities - current (Notes 4, 14 and 25)
Other current liabilities
Total current liabilities
NON-CURRENT LIABILITIES
Deferred tax liabilities (Notes 4 and 21)
Lease liabilities - non-current (Notes 4, 14 and 25)
Net defined benefits liabilities - non-current (Notes 4 and 17)
Guarantee deposits received
Other non-current liabilities (Note 12)
Total non-current liabilities
Total liabilities
Equity (Notes 4 and 18)
Share capital - ordinary shares
Capital surplus
Retained earnings
Legal reserve
Special reserve
Unappropriated earnings
Total retained earnings
Other equity
Total equity
TOTAL		 December 31, 2022 December 31, 2022
％
11
-
4
11
-
33
-
10
9
3
81
1
3
6
8
-
-
-
1
19
100
5
-
33
9
1
-
-
48
-
-
1
1
2
4
52
23
-
7
1
17
25
-
48
100		 December 31, 2021 December 31, 2021
Amount
$ 446,088
19,505
164,382
478,405
2,299
1,394,927
5,103
421,379
376,022
118,551
3,426,661
25,737
128,829
273,059
328,345
3,481
492
11,643
46,808
818,394
$ 4,245,055
$ 220,867
16,026
1,390,693
366,124
30,344
2,069
14,017
2,040,140
10,416
1,479
54,503
17,291
71,381
155,070
2,195,210
1,000,000
1,547
303,977
17,619
722,955
1,044,551
3,747
2,049,845
$ 4,245,055		 Amount
$ 320,197
235,009
146,909
325,665
2,416
1,483,549
7,160
263,447
293,019
76,614
3,153,985
22,448
146,760
262,481
343,436
39,188
592
17,191
38,024
870,120
$ 4,024,105
$ 191,489
68
1,298,071
349,741
31,322
38,560
15,428
1,924,679
10,578
2,999
76,388
13,263
32,082
135,310
2,059,989
1,000,000
1,547
281,889
17,619
669,982
969,490
6,921)
1,964,116
$ 4,024,105		 ％






















































(















8
6
4
8
-
37
-
6
7
2
78
1
4
6
9
1
-
-
1
22
100
5
-
32
9
1
1
-
48
-
-
2
-
1
3
51
25
-
7
-
17
24
-
49
100

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

(With Deloitte & Touche auditors’ report dated March 17, 2023)

179

SYSCOM COMPUTER ENGINEERING CO.

STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31,2022 AND 2021

(In Thousands of New Taiwan Dollars, Except Earnings Per Share)

Code
OPERATING REVENUE (Notes 4,
5, 19, and 25)
4100
Sales

4600
Maintenance revenue
4300
Rental revenue

4000
Total operating revenue
OPERATING COSTS (Notes 4, 11,
20, and 25)
5110
Cost of goods sold
5600
Maintenance costs
5300
Rental costs

5000
Total operating costs

5900
GROSS PROFIT

OPERATING EXPENSES (Notes
10, 17, 20, and 25)
6100
Selling and marketing
expenses
6300
Research and development
expenses
6450
Expected credit loss
recognized on trade
receivables
6000
Total operating expenses
6900
PROFIT FROM OPERATIONS

NON-OPERATING INCOME AND
EXPENSES (Note 4)
7100
Interest income (Note 20)
7010
Other income (Notes 20 and
25)
7020
Other gains and losses (Note
20)
7050
Finance costs (Notes 20 and
25)
7070
Share of profit or loss of
subsidiaries, associates and
joint ventures (Note 12)
7000
Total non-operating income
and expenses		 2022 ％
76

24
-

100

58
17
-

75

25

17
3
-

20

5

-
1

-


-

1)

-
 2021
Amount
$ 4,328,914
1,327,885
17,880

5,674,679

3,280,653
962,166
14,457

4,257,276

1,417,403

936,247
189,458
-

1,125,705

291,698

2,904
60,806

9,085 )

313 )
36,358)

17,954
 Amount
％
$ 4,308,274
77
1,268,288
23
1,514

-
5,578,076
100
3,325,713
59
929,207
17
2,240

-
4,257,160

76
1,320,916

24
866,400
16
170,678
3
357

-
1,037,435

19
283,481

5
2,732
-
14,611
-

10,792 )
-

1,549 )
-
16,304)

-
11,302)

-
(Continued)		 ％









(
(
(




















(








(
(
(
(










180

Code
7900
PROFIT BEFORE INCOME TAX

7950
INCOME TAX EXPENSE (Notes 4 and
21)
8200
NET PROFIT FOR THE YEAR

OTHER COMPREHENSIVE INCOME
(Notes 17, 18, and 21)
8310
Items that will not be reclassified
subsequently to profit or loss:
8311
Remeasurement of defined
benefit plans
8316
Unrealized (loss) gain on
investments in equity
instruments at fair value
through other
comprehensive income
8330
Share of the other
comprehensive income
(loss) of subsidiaries,
associates and joint
ventures accounted for
using the equity method
8349
Income tax relating to items
that will not be
reclassified subsequently
to profit or loss
8360
Items that may be reclassified
subsequently to profit or loss:
8361
Exchange differences on
translating the financial
statements of foreign
operations
8380
Share of the other
comprehensive income
(loss) of subsidiaries,
associates and joint
ventures accounted for
using the equity method
8300
Other comprehensive (loss)
income for the year, net of
income tax
8500
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR
EARNINGS PER SHARE (Note
22)
9710
Basic

9810
Diluted
 2022 ％
5

1

4

1
-
-


-

-

-

1

5


 2021
Amount
$ 309,652
58,922

250,730

17,235
910
543

3,447 )
9,855

97)

24,999

$ 275,729

$ 2.51
$ 2.50		 Amount
$ 272,179
56,357

215,822

6,580
15,545

202 )

1,316 )

4,805 )

435)

15,367

$ 231,189

$ 2.16
$ 2.15		 ％



(
(







(
(
(
(






5
1
4
-
-

-

-

-
-
-
4

The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 17, 2023)

(Concluded)

181

SYSCOM COMPUTER ENGINEERING CO.

STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED DECEMBER 31,2022 AND 2021

(In Thousands of New Taiwan Dollars, except Dividend Per Share)

Co d e
A1
BALANCE AT JANUARY 1, 2021
Appropriation of the 2020 earnings
B1
Legal reserve
B5
Cash dividends - NT$1.5 per share
D1
Net profit for the year ended December 31, 2021
D3
Other comprehensive income (loss) for the year ended
December 31, 2021, net of income tax
D5
Total comprehensive income (loss) for the year ended
December 31, 2021
M5
Actual acquisition of interests in subsidiaries
Z1
BALANCE AT DECEMBER 31, 2021
Appropriation of the 2021 earnings
B1
Legal reserve
B5
Cash dividends - NT$1.9 per share
D1
Net profit for the year ended December 31, 2022
D3
Other comprehensive income (loss) for the year ended
December 31, 2022, net of income tax
D5
Total comprehensive income (loss) for the year ended
December 31, 2022
Z1
BALANCE AT DECEMBER 31, 2022		 Share capital -
ordinary shares
$ 1,000,000
-
-
-

-

-

-
1,000,000
-
-
-

-

-
$ 1,000,000		 Capital surplus
$ 1,521
-
-
-
-
-
26
1,547
-
-
-
-
-
$ 1,547		 Retained earnings Unappropriated
earnings
$ 617,855
(
18,757 )
(
150,000 )
215,822

5,062

220,884

-
669,982
(
22,088 )
(
190,000 )
250,730

14,331

265,061
$ 722,955		 Other equity
Exchange differences
on translating the
financial statements of
foreign operations
Unrealized gain or
loss on financial
assets at fair value
through other
comprehensive
income
( $ 15,110 )
( $ 2,116 )
-
-
-
-
-
-
(
5,240)

15,545
(
5,240)

15,545

-

-
(
20,350 )
13,429
-
-
-
-
-
-

9,758

910

9,758

910
($ 10,592)
$ 14,339		 Other equity
Exchange differences
on translating the
financial statements of
foreign operations
Unrealized gain or
loss on financial
assets at fair value
through other
comprehensive
income
( $ 15,110 )
( $ 2,116 )
-
-
-
-
-
-
(
5,240)

15,545
(
5,240)

15,545

-

-
(
20,350 )
13,429
-
-
-
-
-
-

9,758

910

9,758

910
($ 10,592)
$ 14,339		 Total equity
Exchange differences
on translating the
financial statements of
foreign operations
( $ 15,110 )
-
-
-
(
5,240)
(
5,240)

-
(
20,350 )
-
-
-

9,758

9,758
($ 10,592)
Legal reserve
$ 263,132
18,757
-
-
-
-
-
281,889
22,088
-
-
-
-
$ 303,977		 Special reserve
$ 17,619
-
-
-

-

-

-
17,619
-
-
-

-

-
$ 17,619

























(
(



(
(


 (
(
(

(


(		 (
(



(


 $ 1,882,901
-

150,000 )
215,822
15,367
231,189
26
1,964,116
-

190,000 )
250,730
24,999
275,729
$ 2,049,845

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

(With Deloitte & Touche auditors’ report dated March 17, 2023)

182

SYSCOM COMPUTER ENGINEERING CO.

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31,2022 AND 2021

(In Thousands of New Taiwan Dollars)

Code
CASH FLOWS FROM OPERATING
ACTIVITIES
A10000
Income before income tax

A20010
Adjustments for:
A20100
Depreciation expenses
A20200
Amortization expenses
A20300
Expected credit loss recognized on
trade receivables
A20400
Net gain on financial assets at fair
value through profit or loss
A20900
Finance costs
A21200
Interest income

A21300
Dividend income

A22400
Share of loss of subsidiaries,
associates and joint ventures
A22500
Gain on disposal of property, plant and
equipment
A23800
Write-downs(Reversal) of inventories
A24100
Net loss (gain) on foreign currency
exchange
A30000
Changes in operating assets and liabilities
A31125
Contract assets

A31130
Notes receivable
A31150
Accounts receivable
A31180
Other receivables
A31200
Inventories

A31230
Prepayments

A31240
Other current assets

A32125
Contract liabilities
A32130
Notes payable
A32150
Accounts payable
A32180
Other payables
A32230
Other current liabilities

A32240
Net defined benefits liabilities

A33000
Cash inflows from operations
A33100
Interest received
A33200
Dividends received
A33300
Interest paid

A33500
Income tax paid

AAAA
Net cash inflow from operating
activities		 2022
$ 309,652

101,337
100
-

426 )

313

2,904 )


465 )

36,358

382 )


167

3,475


152,740 )
117

91,132

2,057


161,077 )

83,003 )


1,539 )
29,378
15,958

85,833

16,383

1,411 )
4,650)

283,663
2,904
465

313 )

57,961)

228,758
 2021
$ 272,179
97,142
365
357

409 )
1,549

2,732 )

89 )
16,304

481 )

8 )

1,758 )
231,963

935 )

450,387 )

1,174 )
246,336

10,709 )
58
836

96 )

200,494 )
75,203
2,647
17,696)
257,971
2,732
89

1,549 )
43,064)
216,179
(Continued)

(
(
(
(

(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(

183

Code
CASH FLOWS FROM INVESTING ACTIVITIES
B00010
Acquisition of financial assets at fair value
through other comprehensive income
B00040
Proceeds from sale (acquisition) of financial
assets at amortized cost
B00100
Purchase of financial assets at fair value
through profit or loss
B00200
Proceeds from sale of financial assets at fair
value through profit or loss
B02700
Payments for property, plant and equipment

B02800
Proceeds from disposal of property, plant and
equipment
B03800
(Increase) decrease in refundable deposits

B06100
Decrease in lease receivables
B07600
Dividends from subsidiaries received

BBBB
Net cash inflows from investing
activities
CASH FLOWS FROM FINANCING ACTIVITIES
C03000
Guarantee deposits received
C04020
Repayment of the principal portion of lease
liabilities
C04500
Dividends paid

C05400
Acquisition of subsidiaries

CCCC
Net cash outflows from financing
activities
DDDD
EFFECTS OF EXCHANGE RATE CHANGES ON
THE BALANCE OF CASH AND CASH
EQUIVALENTS HELD IN FOREIGN
CURRENCIES
EEEE
NET INCREASE IN CASH AND CASH
EQUIVALENTS
E00100
CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF THE YEAR
E00200
CASH AND CASH EQUIVALENTS AT THE END
OF THE YEAR		 2022
$ 2,379 )

458


720,000 )

935,930

46,733 )

429

49,182 )
-
2,664

121,187

4,028

38,886 )


190,000 )

-

224,858)

804

125,891
320,197

$ 446,088
 2021

(
(
(
(



(
(

(
(
(
(


(
(
(
(
(

 $ -

2,575 )

845,000 )
953,433

37,715 )
719
5,380
122
5,329
79,693
95

37,988 )

150,000 )
150)
188,043)
75)
107,754
212,443
$ 320,197

The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 17, 2023)

(Concluded)

184

SYSCOM COMPUTER ENGINEERING CO. Notes to Parent Company Only Financial Statements January 1 to December 31, 2022 and 2021 (Amounts in thousands of NTD, unless otherwise indicated)

  1. General SYSCOM COMPUTER ENGINEERING CO. (hereinafter referred to as "the Company") was established in July 1975 and is mainly engaged in the lease and sale of computer systems, design engineering of computer software systems, computer hardware maintenance and computer information system integration. The Company's shares have been listed and traded on the Taiwan Stock Exchange since May 22, 2001.

The parent company only financial statements are presented in NTD, which is the functional currency of the Company.

  1. The Date and Procedures of Authorization of Financial Statements

    • The parent company only financial statements were approved by the Board of Directors on March 17,

  2. Application of New and Revised Standards and Interpretations

  3. (1) Application of the amendments to the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC). Application of the IFRSs endorsed and issued into effect by the FSC did not have any material

  4. impact on the Company’s accounting policies.

  5. (2) The IFRSs endorsed by the Financial Supervisory Commission (FSC) for application starting from 2023

2023
Effective Date
New/Amended/Revised Standards and Interpretations Announced by IASB
Amendment to IAS 1, "Disclosure of Accounting Policies" January 1, 2023 (Note 1)
Amendment to IAS 8, "Definition of Accounting Estimates" January 1, 2023 (Note 2)
Amendments to IAS 12 “Deferred Tax related to Assets and January 1, 2023 (Note 3)
Liabilities arising from a Single Transaction"
Note 1:
The amendments will be applied prospectively for annual reporting periods beginning on or
after January 1, 2023.

Note 2: The amendments will be applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023. Note 3: Except for deferred taxes that were recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments were applied prospectively to transactions that occur on or after January 1, 2022.

As of the date the parent company financial statements were authorized for issue, the company had assessed that the application of above standards and interpretations would not have a material impact on the Company’s financial position and financial performance.

  • (3) New IFRSs in issue by the IASB but not yet endorsed and issued into effect by the FSC
Effective Date Announced
New/ Revised /Amended Standards and Interpretations by the IASB (Note 1)
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”
Amendments to IFRS 16 “Leases Liability in a Sale and Leaseback” January 1, 2024 (Note 2)
IFRS 17 “Insurance contracts” January 1, 2023
Amendment to IFRS 17 January 1, 2023
Amendment to IFRS 17 "Initial Application of IFRS 17 and IFRS 9 - January 1, 2023
Comparative Information”
Amendment to IAS 1 "Classification of liabilities as current or non- January 1, 2024
current"
Amendments to IAS 1 “Non-current Liabilities with Covenants” January 1, 2024
Note 1:
Unless stated otherwise, the above new, revised or amended standards and interpretations are
effective for annual reporting periods beginning on or after their respective effective dates.

185

Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and leaseback transactions entered into after the date of initial application of IFRS 16

As of the date the parent company financial statements were authorized for issue, the Company is continuously evaluating the possible impact that the application of above standards and interpretations will have on the Company’s financial position and financial performance, and will disclose the relevant impact when the evaluation is completed.

  1. Summary of Significant Accounting Policies (1) Statement of Compliance

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

  • (2) Basis of Preparation

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

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

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

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

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

When preparing the accompanying financial statements, the Company used equity method to account for its investment in subsidiaries, associates and joint ventures. In order for the amounts of the net profit, other comprehensive income and total equity in the parent company only financial statements to be the same with those amounts attributable to the owner of the Company in its consolidated financial statements, adjustments arising from the differences in accounting treatment between parent company only basis and consolidated basis were made to the captions of “investments accounted for using equity method”, “share of profit (loss) of subsidiaries, associates and joint ventures accounted for using equity method”, “share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method” and related equity items, as appropriate, in the parent company only financial statements.

  • (3) Classification of current and non-current assets and liabilities

  • Current assets include:

  • A. Assets held primarily for the purpose of trading;

  • B. Assets expected to be realized within twelve months after the reporting period; and

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

  • Current liabilities include:

  • A. Liabilities held primarily for the purpose of trading;

  • B. Liabilities due to be settled within twelve months after the reporting period; and

  • C. Liabilities for which the Company does not have an unconditional right to defer settlement for at least twelve months after the reporting period.

Assets and liabilities that are not classified as current are classified as noncurrent.

(4) Foreign Currencies

In preparing the Company’s financial statements, transactions in currencies other than the Company’s functional currency (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 carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined and related exchange differences are recognized in profit or loss. Conversely, when the fair value changes were recognized in other comprehensive income, related exchange difference shall be recognized in other comprehensive income.

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

186

  • (5) Inventories

Inventories are stated at the lower of cost or net realizable value item by item, except for those that may be appropriate to group items of similar or related inventories. Net realizable value is the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. The calculation of the cost of inventory is derived using the weighted-average method.

(6) Investments in subsidiaries

The Company uses the equity method to account for its investments in subsidiaries. A subsidiary is an entity over which the Company has control.

Under the equity method, investments are initially recognized at cost; the carrying amount after the acquisition date fluctuates along with the distribution of profit or loss from the subsidiaries and other comprehensive income by the Company. Additionally, the change in the interests the Company holds in subsidiaries is recognized pro rata to the shareholding percentages.

When a change in the Company's ownership interest in a subsidiary does not result in a loss of control, it is treated as an equity transaction. The difference between the carrying amount of the investment and the fair value of the consideration paid or received is recognized directly in equity. When the Company's share of losses in a subsidiary equals or exceeds its interest in the subsidiary (including the carrying amount of the subsidiary under the equity method and other long-term interests that are in substance a component of the Company's net investment in the subsidiary), the Company continues to recognize losses in proportion to its equity in the subsidiary.

The excess of the acquisition cost over the Company's share of the net fair value of the identifiable assets and liabilities of the subsidiaries at the acquisition date is recorded as goodwill, which is included in the carrying amount of the investment and is not amortized; the excess of the Company's share of the net fair value of the identifiable assets and liabilities of the subsidiaries at the acquisition date over the acquisition cost is recorded as gain or loss for the period.

The Company assesses impairment based on the cash-generating units as a whole in the financial statements and compares their recoverable amounts with their carrying amounts. If the amount of recoverable assets increased in the future, the reversal of impairment shall be recognized as income. The carrying amount of the reversal of impaired assets shall not exceed the carrying amount before recognition for impairment net of amortization. Impairment losses attributable to goodwill must not be reversed in subsequent periods.

When control over a subsidiary is lost, the Company measures its remaining investment in the subsidiary at fair value at the date of loss of control. The difference between the fair value of the remaining investment and the carrying amount of the investment at the date of loss of control, if any, is recognized in profit or loss for the period. In addition, all amounts recognized in other comprehensive income related to the subsidiary are accounted for on the same basis as if the Company had directly disposed of the related assets or liabilities.

Unrealized profits or losses on downstream transactions with subsidiaries are eliminated in the parent company only financial statements. Profits or losses from upstream and side-stream transactions with subsidiaries are recognized in the parent company only financial statements only to the extent that they are not related to the Company's equity interest in the subsidiary.

(7) Investments in associates and joint ventures

An associate is an entity over which the company has significant influence and which is neither a subsidiary nor an interest in a joint venture. A joint venture is a joint arrangement whereby the Company and other parties that have joint control of the arrangement have rights to the net assets of the arrangement.

The Company uses the equity method to account for its investments in associates and joint ventures.

Under the equity method, investments in an associate and a joint venture are initially recognized at cost and adjusted thereafter to recognize the Company’s share of profit or loss and other comprehensive income of the associate and the joint venture. The Company also recognizes the changes in the Company’s share of equity of associates and joint ventures.

Any excess of the cost of acquisition over the Company’s share of net fair value of the identifiable assets and liabilities of an associate and a joint venture at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized. Any excess of the Company’s share of net fair value of the identifiable assets and liabilities over the cost of acquisition,after reassessment, is recognized immediately in profit or loss.

When the Company subscribes for additional new shares of an associate and a joint venture at a percentage different from its existing ownership percentage, the resulting carrying amount of the investment differs from the amount of the Company’s proportionate interest in the associate and the

187

joint venture. The Company records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus - changes in capital surplus from investments in associates and joint ventures accounted for using the equity method. If the Company’s ownership interest is reduced due to its additional subscription of the new shares of the associate and the joint venture, the proportionate amount of the gains or losses previously recognized in other comprehensive income in relation to that associate and joint ventures is reclassified to profit or loss on the same basis as would be required if the investee had directly disposed of the related assets or liabilities. When the adjustment should be debited to capital surplus, but the capital surplus recognized from investments accounted for using the equity method is insufficient, the shortage is debited to retained earnings.

When the Company's share of losses in an associates or joint venture equals or exceeds its equity interest in the associates and the joint ventures (including the carrying amount of the associates or joint venture under the equity method and other long-term equity interests that are in substance a component of the Company's net investment in the associates and the joint ventures), the Company shall cease to recognize further losses. The Company recognizes additional losses and liabilities only to the extent that legal obligations, constructive obligations or payments on behalf of associates and joint ventures have been incurred.

The entire carrying amount of an investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is not allocated to any asset, including goodwill, that forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increases.

When the Company transacts with its associate and joint venture, profits and losses resulting from the transactions with the associate and joint venture are recognized in the Company’s financial statements only to the extent of interests in the associate and joint venture that are not related to the Company.

(8) Property, plant and equipment

Property, plant and equipment are stated at cost, less recognized accumulated d epreciation and accumulated impairment loss.

Depreciation is recognized using the straight-line method. Each significant part is depreciated separately. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

  • (9) Intangible assets

  • A. Acquired separately

Intangible assets with finite useful lives acquired separately are initially measured at cost and subsequently measured at cost less accumulated amortization and accumulated impairment. Intangible assets are amortized on a straight-line basis over their useful lives. The Company reviews the estimated useful lives, residual values and amortization methods at least at the end of each year and defers the effect of changes in applicable accounting estimates. Intangible assets with indefinite useful lives are stated at cost less accumulated impairment. B. Derecognition

  • When an intangible asset is derecognized, the difference between the net disposal price and

  • the carrying amount of the asset is recognized in profit or loss for the period.

  • (10) Impairment of property, plant and equipment, right-of-use assets ,intangible assets (excluding goodwill) and incremental costs of obtaining contracts

The Company assesses on each balance sheet date whether there is any indication that property, plant and equipment, right-of-use assets and intangible assets (excluding goodwill) may have been impaired. If there is any indication of impairment, the recoverable amount of the asset should be estimated. If the recoverable amount of an individual asset cannot be estimated, the Company is to estimate the recoverable amount of the respective cash-generating unit. Shared assets are allocated to individual cash-generating units on a reasonably consistent basis.

Intangible assets with indefinite useful lives and not yet available for use are tested for impairment at least annually and whenever there is an indication of impairment.

The recoverable amount is the higher of the fair value less costs to sell and its value in use. When the recoverable amount of an individual asset or a cash-generating unit is less than its carrying amount,

188

the carrying amount of the asset or cash-generating unit should be reduced to its recoverable amount. The impairment loss is recognized in profit or loss.

When the impairment loss is subsequently reversed, the carrying amount of the asset or cashgenerating unit is increased to the adjusted recoverable amount, provided that the increased carrying amount does not exceed the carrying amount (net of amortization or depreciation) that would have become if the impairment loss had not been recognized in prior years for that asset or cash-generating unit. Reversal of impairment loss is recognized in profit or loss.

  • (11) Financial instruments

Financial assets and financial liabilities are recognized on parent company only balance sheets when a group entity becomes a party to the contractual provisions of the instruments.

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 fair value through profit or loss) 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 fair value through profit or loss are recognized immediately in profit or loss.

A. Financial assets

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

a. Measurement category

The Company’s financial assets are classified into the following categories: financial assets at FVTPL, financial assets at amortized cost, and investments in equity instruments at FVTOCI.

  • (a) Financial assets at FVTPL

For certain financial assets which include debt instrument that do not meet the criteria of amortized cost or FVTOCI, it is mandatorily required to measure them at FVTPL. Financial assets mandatorily classified as at FVTPL include investments in equity instruments which are not designated as at FVTOCI and debt instruments that do not meet the amortized cost criteria or the FVTOCI criteria.

Financial assets at FVTPL are subsequently measured at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. The dividends, interest earned and net gain or loss recognized in profit or loss on the financial asset. Fair value is determined in the manner described in Note 24.

  • (b)Financial assets at amortized cost

Financial assets that meet the following two 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, investments in debt instruments, notes receivable, accounts receivable, lease receivables, other receivables and refundable deposits, which equals to gross carrying amount determined by 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 multiply the gross carrying amount of a financial asset.

Cash equivalents, held to meet short-term cash commitments, 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, as well as deposits in the bank and commercial papers, which are subject to an insignificant risk of changes in value.

  • (c) Investments in equity instruments at FVTOCI

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

189

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

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

The Company assesses financial assets (including accounts receivable), lease receivables and contract assets at amortized cost at each balance sheet date based on Expected Credit Loss （ ECL ） .

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

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

All impairment of financial assets is recognized through the reduction of the carrying amount of the provisioned account.

c. De-recognition of financial assets

The Company 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. On derecognition of an investment in an equity instrument at FVTOCI, the cumulative gain or loss that had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through profit or loss.

B. Financial liabilities

a. Subsequent measurement

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

b. Derecognition of financial liabilities

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

(12) Recognition of revenue

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

A. Sales revenue Project contract revenue

Project contract revenue is derived from hardware and software system integration services. With the hardware and software system integration services provided by the Company, customers also obtain and consume performance benefits. The hardware and software system integration services rely on the input of technical personnel and the completion of hardware equipment, and the Company measures the progress of completion based on the estimated total cost invested. Customers pay in installments according to contractual agreements. The Company recognizes contract assets over time in the course of providing services and reclassifies them as accounts receivable at the time of billing. If the amount received exceeds the amount of revenue recognized, the difference is recognized as a contract liability.

If it is probable that total contract costs will exceed total contract revenues, all expected losses are recognized as expenses immediately.

190

Product sales revenue

The Company recognizes revenue and accounts receivable from sales of computer hardware and software and computer peripherals at the point when each contractual obligation is satisfied or when the customer has obtained control of and access to the products and assumes the risk of the products.

  • B. Service revenue

Service revenue is derived from the provision of subsequent maintenance services for software and hardware equipment during the contract period. The Company recognizes such revenue over time.

  • (13) Leases

At the inception of a contract, the company assesses whether the contract is, or contains, a lease. A. The Company as lessor

Leases are classified as finance leases whenever the terms of a lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Under capital leases, lease payments include fixed payments. Net investment in leases is measured as the sum of the present value of lease payments receivable and the unguaranteed residual value plus original direct costs and is expressed as capital lease receivables. Capital lease income is allocated to each accounting period to reflect the constant rate of return that the Company's outstanding net lease investment can earn in each period.

Under operating leases, lease payments are recognized as income on a straight-line basis over the relevant lease period.

  • B. The Company as lessee

Except for payments for low-value asset leases and short-term leases which are recognized as expenses on a straight-line basis, the Company recognizes right-of-use assets and lease liabilities for all leases at the commencement date of the 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, and less any lease incentives received, any initial direct costs incurred and an estimate of costs needed to restore the underlying assets. Right-of-use assets are subsequently 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 parent company only 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 comprise 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 Company uses the lessee’s incremental borrowing rates.

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 or a change in future lease payments resulting from a change in an index or a rate used to determine those payments, 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. Lease liabilities are presented on a separate line in the parent company only balance sheets.

  • (14) Government Grants

Government grants are recognized when there is reasonable assurance that the Company will comply with the conditions attached to the government subsidy and that the subsidy will be received. Government grants are recognized in other income on a systematic basis over the period in which the related costs for which they are intended to compensate are recognized as expenses by the Company. Government grants conditioned on the purchase, construction or acquisition by other means of noncurrent assets by the Company are recognized as deferred revenue and are transferred to profit or loss on a reasonable and systematic basis over the useful lives of the related assets.

191

Government grants are recognized in profit or loss in the period in which they become collectible if they are intended to compensate for expenses or losses already incurred or to provide immediate financial support to the Company and have no future related costs.

(15) Employee Benefits

  • A. Short-term employee benefits

Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service.

B. Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service entitling them to the contributions.

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

Net defined benefit liability (asset) represents the actual deficit (surplus) in the Company’s defined benefit plan. 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.

(16) Income tax

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

The Company determines income (loss) for the period in accordance with the regulations enacted by the income tax reporting jurisdictions and calculates income tax payable (recoverable) accordingly.

According to the Income Tax Act in the ROC, an additional tax of unappropriated earnings is provided for in the year the stockholders approve to retain the earnings. Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

  • B. Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the Company’s financial statements 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 and unused tax credits from research, development expenditures and talent training expenditures, etc. 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, associates and joint ventures, except where the Company 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 such temporary differences 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 asset 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 assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset 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 assets and liabilities reflects the tax consequences that would follow

192

from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

  • C. Current and deferred tax

  • Current and deferred tax 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 tax are also recognized in other comprehensive income or directly in equity respectively.

  • Critical Accounting Judgments and Key Sources of Estimation and Uncertainty

In the application of the Company’s accounting policies, the management is required to make judgments, estimates and assumptions which are based on historical experience and other factors that are not readily apparent from other sources. Actual results may differ from these estimates.

The Company has taken the recent development of the COVID-19 outbreak and its possible impact on the economic environment into consideration in making significant accounting estimates related to cash flow projections, growth rates, discount rates, profitability, etc. Management will continue to review the estimates and underlying assumptions. If a revision of an estimate affects only the current period, it is recognized in the period in which it is revised. If a revision of an accounting estimate affects both the current and future periods, it is recognized in the period in which it is revised and in the future periods. Critical accounting judgments

Timing of recognition of revenue

The Company assesses whether a performance obligation is satisfied over time or at a certain point in time in accordance with the terms of the customer contract and applicable regulations.

The revenue generated from the hardware and software system integration services provided by the Company under the contracts depends on the input of technical personnel and the completion of hardware equipment. The Company measures the progress of completion based on the estimated total cost invested and the customers pay in installments according to the contracts. The Company recognizes contract assets in the course of providing services and recognizes revenue based on the total contract price in proportion to completion. For the purpose of calculating the percentage of completion, the Company estimates the total contract cost at the same time when the contract is signed. If there is a subsequent change in the total contract cost, the percentage of completion is revised and the revenue recognition is adjusted in the period of change.

  1. Cash and cash equivalents
Cash and cash equivalents
December 31, 2022 December 31, 2021
Cash on hand and revolving funds $ 405 $ 405
Checking accounts and demand deposits 220,787 319,792
Cash equivalents (investments with
original maturities of less than 3
months)
Commercial papers 224,896 -
$ 446,088 $ 320,197
The interest rate ranges of bank deposits and commercial papers with original maturities of less than
3 months at the balance sheet date were as follows:
3 months at the balance sheet date were as follows:
7.
8.		 December 31, 2022
Bank demand deposits
0.46%
Commercial papers with original
maturities of less than 3 months
0.78%~0.80%
Financial assets at fair value through profit or loss
December 31, 2022
Financial assets mandatorily measured at
fair value through profit or loss - non-
derivative financial assets
- Fund beneficial certificates
$ 19,505
Financial assets at fair value through other comprehensive income
December 31, 2022
Investments in equity instruments-non-
current		 December 31, 2021
0.04%
-
December 31, 2021
$ 235,009
December 31, 2021

Investments in equity instruments-non-
current

193

Domestic investments
Listed stocks
Unlisted stocks		 December 31, 2022
$ 24,142

1,595
$ 25,737		 December 31, 2021 December 31, 2021




$ 20,853
1,595
$ 22,448

The Company invests in the above domestic stocks for medium- to long-term strategic purposes and expects to make profits from the long-term investments. The management of the Company considers that it is inconsistent with the aforementioned long-term investment plan to include short-term fluctuations in the fair values of these investments in profit or loss, and therefore chooses to designate these investments as measured at fair value through other comprehensive income.

The Company purchased the common stocks of Turn Cloud Technology Service Inc. in January 2020, which was designated as investment at fair value through other comprehensive income because it was for the medium- to long-term strategic purpose. The company's common stocks will be available for trading on the Pioneer Stock Board of the Emerging Stock Market on November 26, 2021, and as regular Emerging Stock Market stocks starting February 15, 2022.

9. Financial assets at amortized cost

Financial assets at amortized cost
Time deposits pledged
Bank time deposits with original
maturities of more than 3 months
Current
Non-current
Total		 December 31, 2022
$ 230,417

62,794
$ 293,211
$ 164,382

128,829
$ 293,211		 December 31, 2021










$ 234,339
59,330
$ 293,669
$ 146,909
146,760
$ 293,669

As of December 31, 2022 and 2021, the interest rate ranges for bank time deposits with original maturity over 3 months are 0.76%~1.40% and 0.54%~1.07% per annum.

For information on pledged financial assets at amortized cost, see Note 26.

The Company assessed that the expected credit risk of the above financial assets at amortized cost was not significant and its credit risk did not increase after the initial recognition. The Company did not expect credit losses on the above financial assets at amortized cost to occur within 12 months after the date of the financial statements, and no allowance for losses had been recognized as of December 31, 2022 and 2021.

10.

Accounts receivable

Accounts receivable
Measured at amortized cost
Accounts receivable
Less: Allowance for losses		 December 31, 2022
$ 1,395,696
(
769)
$ 1,394,927		 December 31, 2021

(
(
 $ 1,484,318
769)
$ 1,483,549

The average credit period for the Company's product sales is 60 to 120 days, and the accounts receivable are not interest-bearing.

To mitigate credit risk, the Company's management has assigned a dedicated team to be responsible for credit limit determination, credit approval and other monitoring procedures to ensure that appropriate actions have been taken to collect overdue receivables. In addition, the Company reviews the recoverable amounts of receivables on a case-by-case basis at the balance sheet date to ensure that appropriate impairment losses have been recorded for uncollectible receivables. Accordingly, the management of the Company believed that the credit risk of the Company has been significantly reduced.

The Company recognizes an allowance for losses on accounts receivable based on the expected credit losses over the duration of existence of the accounts receivable. Expected credit losses over the duration of existence are based on the customer's past default history, current financial position and past collection experience, observable changes in national or regional economic conditions related to receivables, and the debtor's industry indicators.

If there is evidence that the counterparty is in serious financial difficulty and the Company cannot reasonably expect to recover the amount, for example, if the counterparty is in liquidation, the Company

194

directly writes off the related accounts receivable but continues the collection activities, and the amount recovered from the collection is recognized in profit or loss.

Based on the above considerations, the Company measured the allowance for losses on accounts receivable based on the aging range of accounts receivable (based on the post date) and evaluated the credit risk of individual customers as follows:

11.

December 31, 2022
1～60 days
61～90 days
91～120 days 121 days or more
Total
Total carrying amount
$ 1,155,380 $ 149,060 $ 19,356 $ 71,900 $ 1,395,696
Allowance for losses (expected
credit losses over the duration
of existence)

-

-

-
(
769)
(
769)
Amortized cost
$ 1,155,380
$ 149,060
$ 19,356
$ 71,131
$ 1,394,927
December 31, 2021
1～60 days
61～90 days
91～120 days 121 days or more
Total
Total carrying amount
$ 1,371,897 $ 70,202 $ 25,539 $ 16,680 $ 1,484,318
Allowance for losses (expected
credit losses over the duration
of existence)

-

-

-
(
769)
(
769)
Amortized cost
$ 1,371,897
$ 70,202
$ 25,539
$ 15,911
$ 1,483,549
Information on the changes in the allowance for losses on accounts receivable is as follows:
2022
2021
Balance at the beginning of the year
$ 769
$ 769
Impairment loss provided for the year
-
357
Write-off for the year

-
(
357)
Balance at the end of the year
$ 769
$ 769
Inventories
December 31, 2022
December 31, 2021
Merchandises
$ 219,550
$ 131,996
Project inventories
195,721
119,661
Inventories in transit
5,862
10,840
Maintenance materials

246

950
Total
$ 421,379
$ 263,447		 1～60 days 61～90 days 91～120 days 121 days or more 121 days or more 121 days or more Total


$ 1,155,380

-
$ 1,155,380

1～60 days

$ 149,060

-
$ 149,060

61～90 days

$ 19,356

-
$ 19,356

91～120 days		 $ 71,900
(
769)
$ 71,131

121 days or more
(
 $ 1,395,696

769)
$ 1,394,927
Total
$ 769
357
(
357)
$ 769
December 31, 2021


$ 131,996
119,661
10,840
950
$ 263,447

Merchandises are mainly computers and peripheral software and hardware equipment for sale. Project inventories are mainly hardware and software merchandise and service costs that have been invested in projects but no revenue has been recognized.

The cost of goods sold related to inventories for the years 2022 and 2021 were $3,280,653 thousand and $3,325,713 thousand, respectively. The cost of goods sold included a loss on decline in value of inventories of $167 thousand and a gain on reversal of value of inventories of $8 thousand, respectively. The increase in net realizable value of inventories was due to the sale of inventories previously recorded as a loss on decline in value.

12. Investments accounted for using the equity method

Investments in subsidiaries
Investments in associates
Investments in joint ventures		 December 31, 2022
$ 203,541
15,486

54,032
$ 273,059		 December 31, 2021 December 31, 2021




$ 197,567
12,179
52,735
$ 262,481

195

(1) Investments in subsidiaries

Investments in subsidiaries
Unlisted companies
Casemaker Inc.
SYSCOM INTERNATIONAL INC.
Wisemaker Technology Co.
Netmaker Technology Co., Ltd.
Coach Technology Management Inc.
Syscom Computer(Thailand)Co., Ltd.
Add: Transfer of credit balance of
long-term investments to other
non-current liabilities		 December 31, 2022
$ 98,578
(
71,381 )
58,256
39,271
4,331

3,105
132,160

71,381
$ 203,541		 December 31, 2021

(
(


 $ 92,775

32,082 )
57,741
39,187
4,688
3,176
165,485
32,082
$ 197,567

The Company’s ownership interest in subsidiaries and the percentage of voting rights at the balance sheet date were as follows:

The Company’s ownership interest in
sheet date were as follows:		 subsidiaries and the percentage of voting rights at the balance subsidiaries and the percentage of voting rights at the balance subsidiaries and the percentage of voting rights at the balance
Name of the subsidiary
Casemaker Inc.
Wisemaker Technology Co.
SYSCOM INTERNATIONAL INC.
Netmaker Technology Co., Ltd.
Coach Technology Management Inc.
Syscom Computer(Thailand)Co., Ltd.		 Ownershipinterest andpercentage of votingrights
December 31,2022
100.00%
98.72%
100.00%
86.60%
97.50%
91.40%		 December 31,2021
100.00%
98.72%
100.00%
86.60%
97.50%
91.40%		 Description
(1)
(1)
(1)
(1)
(1)
(1)

  • A. The shares of profit or loss and other comprehensive income of subsidiaries under the equity method for the years 2022 and 2021 were recognized based on the financial statements of the subsidiaries’ financial statements for the same periods audited by CPAs.

  • B. The Company acquired 13 thousand shares of Netmaker Technology Co., Ltd. from a non-related party for NT$128 thousand in February 2021, and the shareholding percentage was changed to 86.60% after the acquisition.

  • C. The Company acquired 1 thousand shares of Wisemaker Technology Co. from a non-related party for NT$22 thousand in October 2021, and the shareholding percentage was changed to 98.72% after the acquisition.

(2) Investments in associates

Investments in associates
Associates of no materiality
individually
Unlisted companies
DBMaker Japan Inc.		 December 31, 2022
$ 15,486		 December 31, 2021
$ 12,179

The Company accounts for all of the above associates by the equity method.

The Company’s ownership interest in associates and the percentage of voting rights at the balance sheet date were as follows:

sheet date were as follows:
Name of the company
DBMaker Japan Inc.		 Ownershipinterest andpercentage of votingrights
December 31, 2022
49.89%		 December 31, 2021
49.89%

196

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

equity method.
Share of the Company
Net profit for the year
Other comprehensive income
Total comprehensive income		 2022
$ 3,639
332)
$ 3,307		 2021
(
 $ 2,036
(
1,647)
$ 389

The calculation of the Company’s share of profit or loss and other comprehensive income of associates under the equity method for 2022 and 2021 is based on the financial statements of each associate for the same period that have not been audited by CPAs; however, the management of the Company believes that the fact the financial statements of the aforementioned investees have not been audited by the CPAs would not have a material effect.

(3) Investments in joint ventures

Investments in joint ventures
Joint ventures of no materiality
individually
Cloudmaster Co., Ltd.		 December 31, 2022
$ 54,032		 December 31, 2021
$ 52,735

The Company’s ownership interest in joint ventures and the percentage of voting rights at the balance sheet date were as follows:

balance sheet date were as follows:
Name of the company
Cloudmaster Co., Ltd.		 Ownership interest and percentage of voting rights
December 31, 2022
50.00%		 December 31, 2021
50.00%

The Company accounts for the above joint ventures by the equity method.

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

the equity method.
Share of the Company
Net profit for the year
Other comprehensive income
Total comprehensive income		 2022
$ 1,394
97)
$ 1,297		 2021

(
(
 $ 1,182
433)
$ 749

In March 2013, the Company invested in 50% of the shares of Cloudmaster Co., Ltd. in a joint venture with a Japanese company approved by the Investment Commission, MOEA, which is engaged in information software, data processing and electronic information supply services. According to the joint venture agreement, the Board of Directors and the shareholders' meeting of Cloudmaster Co., Ltd. adopt a majority rule for its resolutions, but the Company holds less than half of the seats of directors of the Cloudmaster, and in accordance with the management authority of its actual operations, material resolutions and decisions must be approved by the shareholders of both parties, but the Company is unable to directly decide to obtain other variable remuneration that is not available to the shareholders of the other party, and has no direct ability to influence the remuneration obtained by participating in the joint venture investment. Therefore, the Company has no control over Cloudmaster Co., Ltd.

The shares of profit or loss and other comprehensive income of joint ventures under the equity method for the years 2022 and 2021 were recognized based on the financial statements of the joint ventures’ financial statements for the same periods audited by CPAs.

For information on the nature of business, principal place of business and country of incorporation of the above associates and joint ventures, please refer to Exhibit 3 "Information on Investees".

  1. Property, plant and equipment
Property, plant and equipment
For the Company’s use
Under operating lease		 December 31, 2022
$ 304,533

23,812
$ 328,345		 December 31, 2021




$ 314,174
29,262
$ 343,436

197

(1) For the Company’s use

Land
Buildings
Maintenance
equipment
Computer
equipment
Leasehold
improvements
Others
Total
Cost
Balance at January
1, 2022
$ 110,307 $ 75,940 $ 88,748 $ 262,630 $ 95,186 $ 15,832 $ 648,643
Addition
-
-
9,306
30,285
4,753
2,389
46,733
Disposal
-
- (
10,419 ) (
46,550 )
- (
1,939 ) (
58,908 )
Reclassification

-

-

2,481

272

-

-

2,753
December 31, 2022
Balance
$ 110,307
$ 75,940
$ 90,116
$ 246,637
$ 99,939
$ 16,282
$ 639,221
Accumulated
depreciation
Balance at January
1, 2022
$ - $ 36,381 $ 53,260 $ 152,423 $ 85,094 $ 7,311 $ 334,469
Disposal
-
-
(
10,419 ) (
46,550 )
- (
1,892 ) (
58,861 )
Depreciation
expenses
-
1,289
12,929
32,684
9,854
2,351
59,107
Reclassification

-

-
(
27)

-

-

-
(
27)
Land
Buildings
Maintenance
equipment
Computer
equipment
Leasehold
improvements
Others
Total
December 31, 2022
Balance
$ -
$ 37,670
$ 55,743
$ 138,557
$ 94,948
$ 7,770
$ 334,688
December 31, 2022
Net
$ 110,307
$ 38,270
$ 34,373
$ 108,080
$ 4,991
$ 8,512
$ 304,533
Cost
Balance at January
1, 2021
$ 110,307 $ 75,940 $ 102,740 $ 275,931 $ 95,093 $ 16,859 $ 676,870
Addition
-
-
4,857
29,303
93
3,463
37,716
Disposal
-
- (
20,314 ) (
45,038 )
- (
4,490 ) (
69,842 )
Reclassification

-

-

1,465

2,434

-

-

3,899
December 31, 2021
Balance
$ 110,307
$ 75,940
$ 88,748
$ 262,630
$ 95,186
$ 15,832
$ 648,643
Accumulated
depreciation
Balance at January
1, 2021
$ - $ 35,092 $ 60,234 $ 164,044 $ 75,940 $ 9,346 $ 344,656
Disposal
-
-
(
20,314 ) (
45,038 )
- (
4,252 ) (
69,604 )
Depreciation
expenses
-
1,289
13,465
33,450
9,154
2,217
59,575
Reclassification

-

-
(
125)
(
33)

-

-
(
158)
December 31, 2021
Balance
$ -
$ 36,381
$ 53,260
$ 152,423
$ 85,094
$ 7,311
$ 334,469
December 31, 2021
Net
$ 110,307
$ 39,559
$ 35,488
$ 110,207
$ 10,092
$ 8,521
$ 314,174
Depreciation expenses are provided on a straight-line basis over the following useful lives:
Buildings
50 to 60 years
Maintenance equipment
6 years
Computer equipment
6 years
Leasehold improvements
1 to 10 years
Others
- Office equipment
6 to 8 years
-Transportation equipment
5 years		 Total

Please refer to Note 26 for the amount of property, plant and equipment set as collateral for loans.

  • (2) Under operating lease
Under operating lease
Cost
Balance at January 1, 2022
Reclassification
Balance at December 31, 2022
Accumulated depreciation and impairment
Balance at January 1, 2022
Depreciation expenses
Balance at December 31, 2022
Net at December 31, 2022		 Machinery equipment






$ 30,406
198
$ 30,604
$ 1,144
5,648
$ 6,792
$ 23,812

198

Cost
Balance at January 1, 2021

Reclassification

Balance at December 31, 2021

Accumulated depreciation and impairment
Balance at January 1, 2021

Depreciation expenses
Reclassification
(
Balance at December 31, 2021

Net at December 31, 2021
 $ 1,834
28,572
$ 30,406
$ 131
1,312
299)
$ 1,144
$ 29,262

The Company leases machinery equipment under operating leases for a period of 1 to 3 years. The lessee does not have a preferential right to acquire the asset at the end of the lease period.

The total future lease payments to be received under operating leases are as follows:

Year 1
Year 2
Year 3
Year 4		 December 31, 2022
$ 17,323
16,831
16,740

-
$ 50,894		 December 31, 2021 December 31, 2021




$ 17,834
17,277
16,830
16,740
$ 68,681

Assets under operating leases are depreciated using the straight-line method over 1 to 6 years of useful life.

14.
(1)
(2)		 Lease agreements
Right-of-use assets
December 31, 2022
Carrying amount of right-of-use
assets
Buildings
$ 3,481
Depreciation expenses of right-of-use
assets
Buildings
$ 36,582
Lease liabilities
December 31, 2022
Carrying amount of lease liabilities
Current
$ 2,069
Non-current
$ 1,479
The discount rate range for lease liabilities is as follows:
December 31, 2022
Buildings
1.20%~1.50%		 December 31, 2021
$ 39,188
$ 36,255
December 31, 2021
$ 38,560
$ 2,999
December 31, 2021
1.20%~1.50%
  • (3) Important lease activities and terms

The Company leases in certain buildings for use as offices and dormitories for a period of 5 to 10 years. All operating leases with lease periods of more than 5 years include a review clause that rents are adjusted every 5 years in accordance with market rates. At the end of the lease periods, the Company does not have preferential purchase rights for the leased buildings.

  • (4) Other lease information

The Company leases out its own property, plant and equipment as lessor under operating leases as described in Note 13.

199

Short-term lease expenses
Total cash (outflow) from leases		 2022
$ 5,548
$ 44,865)		 2021

(
(		 $ 3,454
$ 42,317)

The Company has elected to waive the applicable recognition for leases of buildings and leasehold improvements that qualify as short-term leases and does not recognize the related right-of-use assets and lease liabilities for these leases.

15. Intangible assets

Intangible assets

Net at January 1, 2022

Amortization expenses

Net at December 31, 2022


Net at January 1, 2021

Amortization expenses

Net at December 31, 2021
 Computer software
costs

(


(
 $ 592
100)
$ 492
$ 957
365)
$ 592

Amortization expenses for computer software costs are accrued on a straight-line basis over 1 to 10 years of useful life.

As of December 31, 2022 and 2021, the Company had assessed that there was no indication that computer software costs may have been impaired and therefore no impairment testing was performed.

16. Other payables

Other payables
Salaries and bonuses payable
Business taxes payable
Insurance premiums payable
Pension expenses payable
Profit-sharing remuneration payables for
employees
Leave benefits payable
Others		 December 31, 2022
$ 270,900
25,582
17,740
14,293
9,600
2,389

25,620
$ 366,124		 December 31, 2021




$ 228,988
58,490
16,467
13,813
8,450
2,068
21,465
$ 349,741

17. Retirement benefit plans

(1) Defined contribution plan

The pension system of the Company under the “Labor Pension Act” are a governmentadministered defined contribution pension plan, under which the Company is required to contribute 6% of employees' monthly salaries to their personal pension accounts with the Bureau of Labor Insurance.

(2) Defined benefits plan

The Company's pension system under Taiwan’s “Labor Standards Act” is a defined benefit pension plan administered by the government. Employees' pension payments are calculated based on the years of service and the average salary for the six months before the approved retirement date. The Company is required to appropriate 2% of the employees' monthly salaries to the Supervisory Committee of Labor Retirement Reserve for deposit into a special account in the Bank of Taiwan in the Committee's name. Before the end of the year, if the estimated balance of the special account is not enough to pay for the workers who are expected to meet the retirement requirements in the following year, the difference will be made up in one lump sum by the end of March of the following year. The Company has no right to influence the investment management strategy as the special account is entrusted to be administered by the Bureau of Labor Fund, Ministry of Labor.

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

200

December 31, 2022
December 31, 2021
Present value of defined benefits
obligations
$ 202,589
$ 220,060
Fair value of planned assets
(
148,086)
(
143,672)
Net defined benefits liabilities
$ 54,503
$ 76,388
The changes in net defined benefits liabilities (assets) were as follows:
Present value of
defined benefits
obligations
Fair value of
planned assets
Net defined benefits
liabilities (assets)
Balance at January 1, 2021
$ 230,001
($ 129,337)
$ 100,664
Current service costs

273
-
273
Interest expense (income)

666
(
367)

299
Recognized in profit or loss

939
(
367)

572
Remeasurement
Return on planned assets (other
than the amounts included in
net interest)
-
(
1,919 )
(
1,919 )
Actuarial loss - changes in
demographic assumptions
4,321
-
4,321
Actuarial gain - changes in
financial assumptions
(
5,765 )
-
(
5,765 )
Actuarial gain - adjustment
through experiences
(
3,217)

-
(
3,217)
Recognized in other comprehensive
income
(
4,661)
(
1,919)
(
6,580)
Appropriated by the employer

-
(
18,268)
(
18,268)
Benefits payment
(
6,219)

6,219

-
Balance at December 31, 2021

220,060
(
143,672)

76,388
Current service costs

228
-
228
Interest expense (income)

1,377
(
887)

490
Recognized in profit or loss

1,608
(
887)

718
Remeasurement
Return on planned assets (other
than the amounts included in
net interest)
-
(
11,054 )
(
11,054 )
Actuarial gain - changes in
financial assumptions
(
8,420 )
-
(
8,420 )
Actuarial loss - adjustment
through experiences

2,239

-

2,239
Recognized in other comprehensive
income
(
6,181)
(
11,054)
(
17,235)
Appropriated by the employer

-
(
5,368)
(
5,368)
Benefits payment
(
12,895)

12,895

-
Balance at December 31, 2022
$ 202,589
($ 148,086)
$ 54,503		 December 31, 2022
December 31, 2021
Present value of defined benefits
obligations
$ 202,589
$ 220,060
Fair value of planned assets
(
148,086)
(
143,672)
Net defined benefits liabilities
$ 54,503
$ 76,388
The changes in net defined benefits liabilities (assets) were as follows:
Present value of
defined benefits
obligations
Fair value of
planned assets
Net defined benefits
liabilities (assets)
Balance at January 1, 2021
$ 230,001
($ 129,337)
$ 100,664
Current service costs

273
-
273
Interest expense (income)

666
(
367)

299
Recognized in profit or loss

939
(
367)

572
Remeasurement
Return on planned assets (other
than the amounts included in
net interest)
-
(
1,919 )
(
1,919 )
Actuarial loss - changes in
demographic assumptions
4,321
-
4,321
Actuarial gain - changes in
financial assumptions
(
5,765 )
-
(
5,765 )
Actuarial gain - adjustment
through experiences
(
3,217)

-
(
3,217)
Recognized in other comprehensive
income
(
4,661)
(
1,919)
(
6,580)
Appropriated by the employer

-
(
18,268)
(
18,268)
Benefits payment
(
6,219)

6,219

-
Balance at December 31, 2021

220,060
(
143,672)

76,388
Current service costs

228
-
228
Interest expense (income)

1,377
(
887)

490
Recognized in profit or loss

1,608
(
887)

718
Remeasurement
Return on planned assets (other
than the amounts included in
net interest)
-
(
11,054 )
(
11,054 )
Actuarial gain - changes in
financial assumptions
(
8,420 )
-
(
8,420 )
Actuarial loss - adjustment
through experiences

2,239

-

2,239
Recognized in other comprehensive
income
(
6,181)
(
11,054)
(
17,235)
Appropriated by the employer

-
(
5,368)
(
5,368)
Benefits payment
(
12,895)

12,895

-
Balance at December 31, 2022
$ 202,589
($ 148,086)
$ 54,503		 December 31, 2022
December 31, 2021
Present value of defined benefits
obligations
$ 202,589
$ 220,060
Fair value of planned assets
(
148,086)
(
143,672)
Net defined benefits liabilities
$ 54,503
$ 76,388
The changes in net defined benefits liabilities (assets) were as follows:
Present value of
defined benefits
obligations
Fair value of
planned assets
Net defined benefits
liabilities (assets)
Balance at January 1, 2021
$ 230,001
($ 129,337)
$ 100,664
Current service costs

273
-
273
Interest expense (income)

666
(
367)

299
Recognized in profit or loss

939
(
367)

572
Remeasurement
Return on planned assets (other
than the amounts included in
net interest)
-
(
1,919 )
(
1,919 )
Actuarial loss - changes in
demographic assumptions
4,321
-
4,321
Actuarial gain - changes in
financial assumptions
(
5,765 )
-
(
5,765 )
Actuarial gain - adjustment
through experiences
(
3,217)

-
(
3,217)
Recognized in other comprehensive
income
(
4,661)
(
1,919)
(
6,580)
Appropriated by the employer

-
(
18,268)
(
18,268)
Benefits payment
(
6,219)

6,219

-
Balance at December 31, 2021

220,060
(
143,672)

76,388
Current service costs

228
-
228
Interest expense (income)

1,377
(
887)

490
Recognized in profit or loss

1,608
(
887)

718
Remeasurement
Return on planned assets (other
than the amounts included in
net interest)
-
(
11,054 )
(
11,054 )
Actuarial gain - changes in
financial assumptions
(
8,420 )
-
(
8,420 )
Actuarial loss - adjustment
through experiences

2,239

-

2,239
Recognized in other comprehensive
income
(
6,181)
(
11,054)
(
17,235)
Appropriated by the employer

-
(
5,368)
(
5,368)
Benefits payment
(
12,895)

12,895

-
Balance at December 31, 2022
$ 202,589
($ 148,086)
$ 54,503



(
(
(
(
(




(
(

(
(

 $ 100,664
273
299
572

1,919 )
4,321

5,765 )
3,217)
6,580)
18,268)
-
76,388
228
490
718

11,054 )

8,420 )
2,239
17,235)
5,368)
-
$ 54,503

The amounts recognized in profit or loss for defined benefit plan are summarized by function as follows:

follows:
Operating expenses 2022
$ 718		 2021
$ 572

The Company is exposed to the following risks as a result of the pension system under the “Labor Standards Act”:

A. Investment risk: The Bureau of Labor Funds, Ministry of Labor invests the Labor Pension Fund in domestic (and foreign) equity securities, debt securities and bank deposits through its own

201

  • operations and by entrusted 3rd parties, but the amount allocated to the Company's plan assets should not be less than the income at the interest rate of two-year time deposits in local banks.

  • B. Interest rate risk: A decrease in interest rates on government bonds will increase the present value of the defined benefit obligation, but the return on debt investment in plan assets will also increase, which will have a partially offsetting effect on the net defined benefit obligation.

  • C. Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salary of the plan member. Therefore, increases in plan member’s salary will result in an increase in the present value of the defined benefit obligation.

The present value of the Company's defined benefit obligation was actuarially determined by a qualified actuary.

qualified actuary.
Discount rate
Expected salary increase rate		 December 31, 2022
1.25%
2.00%		 December 31, 2021
0.65%
2.00%

The amount by which the present value of the defined benefit obligation would increase (decrease) if there are reasonable possible changes in significant actuarial assumptions, with all other assumptions held constant, is as follows:

held constant, is as follows:
Discount rate
Increase by 0.25%
Decrease by 0.25%
Expected salary increase rate
Increase by 0.25%
Decrease by 0.25%		 December 31, 2022
($ 3,352)
$ 3,442
$ 3,408
($ 3,336)		 December 31, 2021
(


(		 (


(		 $ 3,980)
$ 4,094
$ 4,029
$ 3,938)

The sensitivity analysis above may not reflect actual changes in the present value of the defined benefit obligation because the actuarial assumptions may be correlated and changes in only one assumption are not feasible.

assumption are not feasible.

(1)		 Amount expected to be appropriated
within 1 year
Average duration to maturity of
defined benefit obligation
Equity
Share capital - ordinary shares
Authorized number of shares (in
thousands)
Authorized capital
Number of shares issued and fully
paid (in thousands)
Issued shares		 December 31, 2022
$ 2,289
6.71Years
December 31, 2022

157,000
$ 1,570,000

100,000
$ 1,000,000		 December 31, 2021
$ 2,348
7.34 years
December 31, 2021






157,000
$ 1,570,000
100,000
$ 1,000,000

The issued common stock has a par value of $10 per share and each share is entitled to one right to vote and the right to receive dividends.

  • (2) Capital surplus

Capital surplus results from the difference between the actual acquisition or disposal price and the book value of the Company's equity in a subsidiary under equity transactions and from donated assets.

  • (3) Retained earnings and dividend policy

In accordance with the Company's Articles of Incorporation, if the Company made a profit in a fiscal year as concluded by the year-end accounting close, the profit shall be first used for paying taxes, making up for the cumulative losses, setting aside 10% of the remaining profit as a legal reserve unless it has reached the total amount of the Company’s paid-in capital, setting aside an amount for or reversing a special reserve in accordance with laws and regulations, and then any remaining profit, together with

202

any undistributed earnings, shall be adopted by the Company’s Board of Directors as the basis for making a distribution proposal, which shall then be submitted to the shareholders’ meeting for a resolution before distribution of bonuses to shareholders. For the distribution policy on profit-sharing remuneration for employees and directors, see Note 20 (7) on profit-sharing remuneration for employees and directors.

The principle of the Company's dividend policy is to distribute cash dividends and stock dividends in an appropriate mix, and to determine the type, amount and timing of dividends based on the actual profitability, capital budget planning and capital position of the year. The Company shall distribute cash dividends at no less than 10% of the total dividends to be distributed in the year; however, if it has more abundant surplus and capital, it may raise said percentage.

Legal reserve should be appropriated until its balance reaches the Company's total paid-in capital. Legal reserve may be used to make up for losses. If the Company has no loss, the excess of legal reserve over 25% of the total paid-in capital may be distributed in cash in addition to being capitalized as equity. When distributing earnings, the Company is required by law to provide special reserve for the net reduction of other equity items. If the net deduction of other shareholders' equity is subsequently reversed, within the portion of which, special reserve may be reversed for distribution of earnings. The Company held regular shareholders' meetings on June 15, 2022 and July 29, 2021, respectively, and resolved to approve the following distribution proposals for 2021 and 2020 earnings:

Legal reserve
Cash dividends
Cash dividends per share (NTD)		 2021
$ 22,088
$ 190,000
$ 1.9		 2020




$ 18,757
$ 150,000
$ 1.5

On March 17, 2023, the Company's Board of Directors proposed to distribute 2022 earnings as follows:

follows:
Legal reserve
Cash dividends
Cash dividends per share (NTD)		 2022


$ 26,506
$ 220,000
$ 2.2

The 2022 earnings distribution proposal is subject to the resolution of the regular shareholders' meeting scheduled for June 13, 2023.

(4) Special reserve

Upon the adoption of IFRSs for the first time, the Company transferred the cumulative translation adjustment of $17,619 thousand on the accounting book to retained earnings, and a special reserve of the same amount was provided.

  • (5) Other equity interests

  • A. Exchange differences on translation of financial statements of foreign operations

Balance at the beginning of the year
Translation differences of foreign
operations
Share of subsidiaries, associates and
joint ventures accounted for using
the equity method
Balance at the end of the year		 2022
$ 20,350 )
9,855
97)
$ 10,592)		 2021
(
(
(		 (
(
(
(		 $ 15,110 )

4,805 )
435)
$ 20,350)
  • B. Unrealized gain or loss on financial assets at fair value through other comprehensive income
Balance at the beginning of the year
Unrealized gain or loss on equity
instruments arising during the year
Balance at the end of the year		 2022
$ 13,429
910
$ 14,339		 2021


(

 $ 2,116 )
15,545
$ 13,429

203

  1. Revenue
Revenue
Sales revenue
Project contract revenue and
merchandise sales revenue
Service revenue
Rental revenue
Equipment rental revenue		 2022
$ 4,328,914
1,327,885
17,880
$ 5,674,679		 2021




$ 4,308,274
1,268,288
1,514
$ 5,578,076
  • (1) Description of customer contracts Sales revenue

Customer contracts under the project contract revenue are for system integration services based on customization specifications. Revenue is recognized based on the degree of completion of the contracts, and the customer pays the contract consideration according to the contract schedule.

Merchandise sales revenue is recognized when the contractual obligations are met or when the customer has acquired control and use of the merchandises and assumes the risk of the merchandises. Service revenue

Service revenue arises when maintenance services are provided to the customer during the contract period. Part of the consideration is received in advance at the time of signing the contract and revenue is subsequently recognized over the contract period on a straight-line basis.

  • (2) Contract balances
Contract balances
Accounts receivable (Note 10)
Contract assets
System integration services
Less: Allowance for losses
Contract assets - current
Contract liabilities
System integration services		 December 31, 2022
$ 1,394,927
$ 478,405

-
$ 478,405
$ 220,867		 December 31, 2021








$ 1,483,549
$ 325,665
-
$ 325,665
$ 191,489

The changes in contract assets and contract liabilities were mainly due to the difference between the timing of meeting performance obligations and the timing of customer payments. There was no material change in the period except for the adjustment based on the results of completion measurement.

20. Net profit for the period

  • (1) Interest income

Net profit for the period
(1)
Interest income
Bank deposits
(2)
Other income
Government grants income
Marketing incentive income
Rental income
Others
(3)
Other gain and loss
Gain on disposal of property, plant and
equipment		 2022
$ 2,904
2022
$ 39,070
10,563
4,930
6,243
$ 60,806
2022
$ 382		 2021
$ 2,732
2021




$ -
3,926
4,953
5,732
$ 14,611
2021
$ 481

204

Net gain on financial assets at fair value
through profit or loss
Net foreign currency exchange gain (loss)
Others
(4)
Finance costs
Interest on lease liabilities
Interest on bank loans
Others
(5)
Depreciation and amortization
Summary of depreciation expenses
by function
Operating costs
Operating expenses
Summary of amortization expenses
by function
Operating expenses
(6)
Employee benefits expenses
Short-term employee benefits
Salary expenses
Labor and health insurance
expenses
Other employment expenses
Retirement benefits (Note 17)
Defined contribution plan
Defined benefits plan
Total
Summary by function
Operating costs
Operating expenses		 2022
426
1,707
11,600)
$ 9,085)
2022

311
-
2

313
2022
19,629
81,708
101,337
100
2022
1,266,755
110,272
46,741
1,423,768
55,739
718
56,457
1,480,225
582,220
898,005
1,480,225		 2021
(
(		 (
(
(		 409

111 )
11,571)
$ 10,792)
2021


$ $

$ 874
674
1
$ 1,549
2021



$


$ 15,563
81,579
$ 97,142
$ 365
2021
$

$








$







$ 1,170,130
106,645
47,271
1,324,046
53,766
572
54,338
$ 1,378,384
$ 523,233
855,151
$ 1,378,384
$
$
$

(7) Profit-sharing remuneration for employees and directors In accordance with the Company's Articles of Incorporation, if the Company makes a profit in a year, it shall pay profit-sharing remuneration for employees of not less than 3% of the pre-tax profit before paying the profit-sharing remuneration for employees. In accordance with the Board of Directors' resolutions dated March 17, 2023 and March 18, 2022, the Company would pay profit-sharing remuneration for employees at 3.01% of its profit for both of the years 2022 and 2021, in the amount of NT$9,600 thousand and NT$8,450 thousand respectively. The profit-sharing remuneration for directors was not estimated for 2022 and 2021.

205

Any change in the amount after the approval and announcement of the annual parent company only financial statements will be treated as a change in accounting estimate with an adjustment in the following year.

The actual distribution amounts for profit-sharing remunerations for employees and directors for 2021 and 2020 did not differ from the amounts recognized in the parent company only financial statements for 2021 and 2020.

Please refer to the “Market Observation Post System” of the Taiwan Stock Exchange for information on the Company's profit-sharing remuneration for employees resolved by the Board of Directors in 2023 and 2022.

21. Income tax

(1) Major components of income tax expense recognized in profit or loss

Current income tax
Generated during the year
Adjustments for prior years
Deferred income tax
Generated during the year
Income tax expense recognized in
profit or loss		 2022
$ 59,006
(
2,023 )
1,939
$ 58,922		 2021





$ 49,391
3,655
3,311
$ 56,357

The reconciliation of accounting income to income tax expense was as follows:

Net profit before tax
Income tax expense at statutory rate
on net profit before tax
Non-deductible expenses for tax
purposes
Tax-exempt income
Investment tax credits used in the
year
Unrecognized deductible temporary
differences
Adjustments to prior years' current
income tax expense recorded in the
year
Income tax expense recognized in
profit or loss		 2022
$ 309,652
$ 61,930
1,512

1,031 )

9,428 )
7,962
2,023)
$ 58,922		 2021


(
(
(

(
(

 $ 272,179
$ 54,436
1,414

1,996 )

6,199 )
5,047
3,655
$ 56,357

(2) Deferred income tax assets and liabilities

The changes in deferred income tax assets and liabilities are as follows: 2022

2022
Deferred income tax assets
Temporary differences
Unrealized loss on decline in value
of inventories
Defined benefits retirement plans

Others


Deferred income tax liabilities
Temporary differences
Unappropriated earnings of
subsidiaries and affiliates		 Balance at the
beginning of the
year		 Recognized in
profit or loss
( $ 1,172 )
(
930 )

1

($ 2,101)

$ 162		 Recognized in
other
comprehensive
income


$ -
(
3,447 )

-

($ 3,447)




$ -		 Balance at the end
of the year




(		 $ 1,523
15,278
390

$ 17,191

$ 10,578)








(		 $ 351
10,901
391
$ 11,643
$ 10,416)

206

2021

2021
(3)
(4)		 Balance at the
beginning of the
year
Recognized in
profit or loss
Recognized in
other
comprehensive
income
Balance at the end
of the year
Deferred income tax assets

Temporary differences

Unrealized loss on decline in value
of inventories
$ 1,525
( $ 2 )
$ -
$ 1,523
Defined benefits retirement plans

20,133 (
3,539 ) (
1,316 )
15,278
Others

277

113

-

390
$ 21,935
($ 3,428)
($ 1,316)
$ 17,191

Deferred income tax liabilities

Temporary differences

Unappropriated earnings of
subsidiaries and affiliates
($ 10,695)
$ 117
$ -
($ 10,578)
Income tax expense recognized in other comprehensive income
2022
2021
Deferred income tax
Generated during the year
- Remeasurement of defined
benefit plans
$ 3,447
$ 1,316
Deductible temporary differences for deferred income tax assets not recognized in the balance sheets
December 31, 2022
December 31, 2021
Deductible temporary differences
$ 335
$ 335		 Recognized in
other
comprehensive
income



)

)




 Balance at the end
of the year
-
1,316
-

$ 1,523

15,278

390
$ 17,191



($ 10,578)
2021
$ 1,316

$
-
$
$ 335
  • (5) Status of income tax assessment

The Company's income tax returns up to 2020 have been assessed by the tax authorities.

22. Earnings per share

The earnings and weighted-average number of shares of common stock used in the calculation of earnings per share were as follows:

Net profit for the year

earnings per share were as follows:
Net profit for the year
The net profit used in the calculation of
basic earnings per share
The net profit used in the calculation of
diluted earnings per share
Number of shares
The weighted-average number of shares
of common stock used in the
calculation of basic earnings per share
Impact of potential common stock with
dilutive effect:
Profit-sharing remuneration for
employees
The weighted-average number of shares
of common stock used in the
calculation of diluted earnings per
share		 2022
2021
$ 250,730
$ 215,822
$ 250,730
$ 215,822
Unit: Thousands of shares
2022
2021
100,000
100,000
447

369
100,447

100,369		 2021



100,000
369
100,369

If the Company may choose to have the employee compensation distributed via a stock or cash dividend, the calculation of the diluted earnings per share assumes that the bonus to employees is with a stock dividend distributed, with the weighted average number of shares outstanding included when the

207

potential common stock has a diluted effect. The dilutive effect of these potential common shares also continues to be considered in the calculation of diluted earnings per share before the number of shares awarded to employees in the following year's resolution.

23. Capital risk management

The Company conducts capital management to ensure that it can continue to operate while maximizing shareholder returns by optimizing debt and equity balances. The overall strategy of the Company has not changed since 2013.

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

The Company is not subject to other external capital requirements.

The Company's key management reviews the Company's capital structure annually, which includes consideration of the cost of each type of capital and the related risks. The Company will balance its overall capital structure by paying dividends, adding or repaying loans, as recommended by key management.

24. Financial instruments

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

The management of the Company considers that the carrying amounts of financial assets and financial liabilities that are not measured at fair value approximate their fair values, and therefore the carrying amounts of the Parent Company Only Balance Sheets are a reasonable basis for estimating fair values.

  • (2) Fair value information - financial instruments measured at fair value on a recurring basis Fair value hierarchy December 31, 2022
Fair value hierarchy
December 31, 2022
Financial assets at fair value through
profit or loss

Fund beneficial certificates

Financial assets at fair value through
other comprehensive income

Investments in equity instruments
- Domestic listed stocks

- Domestic unlisted stocks


December 31, 2021
Financial assets at fair value through
profit or loss

Fund beneficial certificates

Financial assets at fair value through
other comprehensive income

Investments in equity instruments
- Domestic listed stocks

- Domestic unlisted stocks

 Level 1

$ 19,505


$ 24,142

-

$ 24,142

Level 1

$ 235,009


$ 20,853

-

$ 20,853
 Level 2

$ -


$ -

-

$ -

Level 2

$ -


$ -

-

$ -
Level 3
$ -



$ -

1,595

$ 1,595

Level3
$ -



$ -

1,595

$ 1,595
Total




















$ 19,505
$ 24,142

1,595
$ 25,737
Total




















$ 235,009
$ 20,853

1,595
$ 22,448

There were no transfers between Level 1 and Level 2 fair value measurements in 2022 and 2021.

  • (3) Type of financial instruments
Type of financial instruments
Financial assets
Financial assets mandatorily
measured at fair value through
profit or loss
Financial assets at amortized cost
(Note 1)		 December 31, 2022
$ 19,505
2,141,628		 December 31, 2021
$ 235,009
2,106,991

208

Investments in equity instruments
designated as at fair value through
other comprehensive income
Financial liabilities
Measured at amortized cost (Note 2)		 December 31, 2022
25,737
1,772,843		 December 31, 2021
22,448
1,647,880

Note 1: The balance includes financial assets measured at amortized cost, such as cash and cash equivalents, investments in debt instruments, notes receivable, accounts receivable, lease receivables, and other receivables.

Note 2: The balance includes financial liabilities measured at amortized cost, such as notes payable, accounts payable and other payables.

  • (4) Financial risk management objectives and policies

The Company's major financial instruments include investments in equity and debt instruments, accounts receivable, accounts payable, and lease liabilities. The Company's financial management department provides services to each business unit, coordinates access to domestic and international financial markets, and monitors and manages financial risks associated with the Company's operations through internal risk reporting that analyzes risk exposure based on risk level and breadth. These risks include market risk (including exchange rate risk and interest rate risk), credit risk and liquidity risk.

  • A. Market risk

The main financial risks to which the Company is exposed as a result of the Company's operating activities are the risk of changes in foreign currency exchange rates (see a. below) and the risk of changes in interest rates (see b. below).

  • a. Exchanger rate risk

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

The carrying amounts of monetary assets and monetary liabilities that are not denominated in the functional currency as of the balance sheet date are disclosed in Note 28.

Sensitivity analysis

The Company is mainly affected by the fluctuation of USD exchange rate. The following describes in details the sensitivity analysis of the Company when the exchange rate of NTD (functional currency) increases and decreases by 10% against the relevant foreign currencies. 10% is the sensitivity percentage used for the Company’s internal reporting of exchange rate risk to key management and represents management's assessment of the reasonably possible range of changes in foreign currency exchange rates. The sensitivity analysis includes only foreign currency monetary items in circulation and adjusts their translation at the end of the period by a 10% change in the exchange rate. When NTD appreciates 10% relative to the US dollar, net profit before tax in 2022 and 2021 will decrease by $5,205 thousand and increase $6,608 thousand respectively. If NTD depreciates by 10% against USD, the effect on net profit before tax will be the negative number for the same amount. The effect of the above exchange rate fluctuations mainly arises from foreign currency cash, and accounts payable of the Company that are outstanding at the balance sheet date and not covered by cash flow hedge.

  • b. Interest rate risk

The Company borrow funds at both fixed and floating interest rates, which results in interest rate risk. The Company manages interest rate risk by maintaining an appropriate borrowing mix of fixed and floating interest rates.

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

December 31, 2022 December 31, 2021 With fair value interest rate risk - Financial assets $ 518,107 $ 293,670 - Financial liabilities 3,548 41,558

209

==> picture [354 x 47] intentionally omitted <==

Sensitivity analysis

The following sensitivity analysis was determined based on the interest rate risk of the non-derivative instruments at the balance sheet date. For floating rate liabilities, the analysis assumes that the amount of the liability outstanding at the balance sheet date is outstanding in the reporting period. The rate of change used in the Company’s reporting interest rates internally to key management is a 25 basis point increase or decrease in interest rates, which also represents management's assessment of the range of reasonably possible changes in interest rates.

If the interest rate increases/decreases by 25 basis points, with all other variables held constant, the Company's net profit before tax for 2022 and 2021 would increase/decrease by $552 thousand and $799 thousand.

  • B. Credit risk

Credit risk refers to the risk of the Company’s financial loss resulting from the counterparties' default on contractual obligations. As of the balance sheet date, the Company's maximum exposure to credit risk of financial loss due to non-performance of counterparties' obligations and financial guarantees provided by the Company mainly arises from the carrying amount of financial assets recognized in the Parent Company Only Balance Sheet.

Before accepting a new customer, the Company assesses the credit quality of the potential customer and sets the credit limit of the customer through its internal credit and related sales management departments, and the credit limit and rating of the customer are reviewed annually. C. Liquidity risk

The Company manages and maintains a sufficient portion of cash and cash equivalents to support the Group's operations and mitigate the impact of cash flow fluctuations. The Company's management monitors the use of banking facilities and ensures compliance with the terms of borrowing contracts.

Bank loans are an important source of liquidity for the Company. As of December 31, 2022 and 2021, the Company had unused financing facilities as described in b. Description of financing facilities below.

  • a. Liquidity and interest rate risk of non-derivative financial liabilities

The analysis of the remaining contractual maturities of non-derivative financial liabilities is prepared based on the undiscounted cash flows (including principal and estimated interest) of financial liabilities based on the earliest possible date on which the Company could be required to make repayment. Accordingly, the Company's bank loans that may be required to be repaid immediately are listed in the table below for the earliest period, without considering the probability that the bank will immediately enforce the right; the maturity analysis of other non-derivative financial liabilities is prepared based on the contractual repayment dates.

December 31, 2022

Payment on Payment on
demand or less than
1 month 1～3 months 3 months～1year 1～5years More than 5years
Non-derivative financial
liabilities
Non-interest-bearing
liabilities $ -
$
1,772,843		 $ -
$		 - $ -
Lease liabilities 175 350 1,576 1,495 -
Financial guarantee
liabilities - - 495,391 - -
Floating rate instruments - - - - -
Fixed rate instruments - -
-
-
 -
$ 175 $
1,773,193
 $ 496,967
$		 1,495
$ -
Further information on the maturity analysis of lease liabilities is as follows:
Less than 1 year 1 to 5 years 5 to 10 years
Lease liabilities $ 2,101
 $ 1,495
$ -

210

December 31, 2021 December 31, 2021
Payment on
demand or less than
1 month 1～3 months 3 months～1year 1～5years Morethan5 years
Non-derivative financial
liabilities
Non-interest-bearing
liabilities $ -
$
1,647,880		 $ -
$ - $ -
Lease liabilities 3,239 6,477 29,147 3,020 22
Financial guarantee
liabilities - - 397,716 - -
Floating rate instruments - - - - -
Fixed rate instruments - -
-
-
 -
$
3,239		 $
1,654,357
 $ 426,863
$ 3,020
$ 22
Further information on the maturity analysis of lease liabilities is as follows:
Less than 1 year 1 to 5 years 5 to 10 years
Lease liabilities $ 38,863
 $ 3,020
$ 22

The amount of the above financial guarantee contract is the maximum amount that the Company may have to pay to fulfill its guarantee obligations if the holder of the financial guarantee contract claims the full amount of the guarantee from the guarantor. Based on the expectation at the balance sheet date, the Company believed that the possibility of paying the amount of the contract was not high.

b.

The amount of floating rate instruments for the above non-derivative financial assets and liabilities will vary depending on the difference between the floating rate and the interest rate estimated at the balance sheet date. Financing facilities

Financing facilities
Secured bank financing
facilities
- Amount drawn
- Amount undrawn		 December 31, 2022
$ -

-
$ -		 December 31, 2021
$ -

40,000
$ 40,000
$ -
40,000
$ 40,000
Unsecured bank financing
facilities (revisited
annually)
- Amount drawn

- Amount undrawn

 $ 418,077

1,416,923

$ 1,835,000
 $ 340,375
1,744,625

$ 2,085,000
  1. Related Parties Transactions

In addition to those disclosed in other notes, the transactions between the Company and its related parties were as follows:

  • (1) Names of related parties and the relationships

Name of related party Relationship with the Company Furly Investment Co., Ltd. Investor with material influence Chuan Gao Investment Co., Ltd. Investor with material influence Welida Investment Co., Ltd. Substantive related party DBMaker Japan Inc. Associates Cloudmaster Co., Ltd. Joint venture Netmaker Technology Co., Ltd. Subsidiaries Casemaker Inc. Subsidiaries Wisemaker Technology Co. Subsidiaries Syscom Computer(Thailand)Co., Ltd. Subsidiaries Coach Technology Management Inc. Subsidiaries Syscom Computer(Shenzhen)Co., Ltd. Subsidiaries Xian Linan Computer Co., Ltd. Subsidiaries

211

  • (2) Operating revenue (including sales, services and rental)
Type of related party
Subsidiaries
Associates
Joint venture		 2022
$ 17,058
230
113
$ 17,401		 2021




$ 2,876
304
467
$ 3,647

(3)		 Operating costs (including sales, services and
Type of related party
Subsidiaries
Associates
Joint venture		 rental)
2022
$ 61,543
9,580

2,669
$ 73,792		 2021




$ 61,122
1,640
779
$ 63,541
Subsidiaries
Associates
Joint venture		 $ 61,543
9,580

2,669
$ 73,792		 $ 61,122
1,640

779
$ 63,541		 $ 61,122
1,640

779
$ 63,541

(4)		 Amounts due from
Account on the
financial
statements
Accounts
receivable


 related parties (excluding loans to related parties)
Type of related party
December 31, 2022
Subsidiaries
$ 15,075
Associates

178
Joint venture

72

$ 15,325
 December 31, 2021


$ 1,430
-
-
$ 1,430

The outstanding receivables from related parties were not guaranteed. No allowance for losses was provided for the amounts due from related parties in 2022 and 2021.

  • (5) Amounts due to related parties (excluding loans from related parties) Account on the

financial

Account on the
financial
statements
Accounts
payable



 Type of related party
Subsidiaries

Associates

Joint venture

Investor with material influence

 December 31, 2022
$ 26,520
2,151
1,473

10

$ 30,154
 December 31, 2021




$ 24,654
-
1,021
8
$ 25,683

The balance of outstanding payables to related parties was not guaranteed.

  • (6) Acquisition of property, plant and equipment
Acquisition of property, plant and equipment
Type of related party
Subsidiaries
Associates		 Acquisition price
2022
$ 87
7,660
$ 7,747		 2021




$ -
7,104
$ 7,104
(7) Lease agreement
Account on the
financial
statements
Lease liabilities
Name of related party
Chuan Gao Investment Co., Ltd.

Furly Investment Co., Ltd.

 December 31, 2022
$ 1,037

-

$ 1,037
 December 31, 2021 December 31, 2021




$ 22,842
15,391
$ 38,233

212

Name of related party
Finance costs
Chuan Gao Investment Co., Ltd.
Furly Investment Co., Ltd.		 2022
$ 163
106
$ 269		 2022




$ 487
335
$ 822
  • (8) Endorsement and guarantee

Please refer to Exhibit 1 for information on the endorsement and guarantee between the Company and its related parties.

(9) Rental expenses
Account on the
financial
statements
Operating
expenses


 Name of related party
Chuan Gao Investment Co., Ltd.

Furly Investment Co., Ltd.

Substantive related party

 2022
$ 2,709
1,565
72

$ 4,346
 2021





$ 788
$ 1,310
72
$ 2,170
(10) Rental income
Account on the
financial
statements
Other income



 Name of related party
Cloudmaster Co., Ltd.

Wisemaker Technology Co.

Netmaker Technology Co., Ltd.

Coach Technology Management
Inc.
 2022
$ 1,685
1,479
484
18
$ 3,666
 2021




$ 1,457
1,410
801
21
$ 3,689
  • (11) Salaries for key management
Salaries for key management
Short-term employee benefits
Retirement benefits		 2022
$ 219,365
12,024
$ 303,389		 2021




$ 271,105
11,169
$ 282,274

Salaries for directors and other key management personnel are determined by the Remuneration Committee based on individual performance and market trends.

26. Assets Pledged as Collateral

The following assets were pledged as collateral for system design contract performance, guarantee facilities and bank loan facilities:

facilities and bank loan facilities:
Time deposits pledged (recorded as
financial assets at amortized cost)
Property, plant and equipment - net		 December 31, 2022
$ 230,417

-
$ 230,417		 December 31, 2021




$ 234,339
74,597
$ 308,936

27. Significant Contingent Liabilities and Unrecognized Contract Commitments

As of December 31, 2022, the Company's guarantee notes payable for customer project contracts and letters of guarantee issued by banks amounted to $140,264 thousand and $418,077 thousand, respectively.

  1. Foreign-currency-denominated Assets and Liabilities that have Significant Influence

The following information is presented in foreign currencies other than the functional currency of the Company, and the exchange rates disclosed are the rates at which the foreign currencies were translated into the functional currency. Information on foreign currency assets and liabilities with significant effect:

213

December 31, 2022
Foreign currency
Exchange rate
Carrying amount
Foreign currency assets
Monetary item
USD
$ 2,783
30.71
$ 85,455
JPY
921
0.2324
214
HKD
355
3.938
1,399
Non-monetary item
USD
3,210
30.71
98,578
JPY
66,636
0.2324
15,486
Foreign currency
liabilities
Monetary item
USD
1,088
30.71
33,408
JPY
9,255
0.2324
2,151
Non-monetary item
USD
2,324
30.71
71,381
December 31, 2021
Foreign currency
Exchange rate
Carrying amount
Foreign currency assets
Monetary item
USD
$ 323
27.68
$ 8,932
HKD
227
3.5490
807
Non-monetary item
USD
3,352
27.68
92,775
JPY
50,642
0.2405
12,179
Foreign currency
liabilities
Monetary item
USD
2,710
27.68
75,014
RMB
8
4.3415
35
Non-monetary item
USD
1,159
27.68
32,082
Foreign currency exchange gain and loss (realized and unrealized) with material effect are as follows:
2022
2021
Foreigncurrency
Exchangerate
Net exchange (loss)
gain
Exchangerate
Net exchange (loss)
gain
USD
29.805(USD: NTD)
$ 1,707 28.009 (USD: NTD)
( $ 111 )		 December 31, 2022
Foreign currency
Exchange rate
Carrying amount
Foreign currency assets
Monetary item
USD
$ 2,783
30.71
$ 85,455
JPY
921
0.2324
214
HKD
355
3.938
1,399
Non-monetary item
USD
3,210
30.71
98,578
JPY
66,636
0.2324
15,486
Foreign currency
liabilities
Monetary item
USD
1,088
30.71
33,408
JPY
9,255
0.2324
2,151
Non-monetary item
USD
2,324
30.71
71,381
December 31, 2021
Foreign currency
Exchange rate
Carrying amount
Foreign currency assets
Monetary item
USD
$ 323
27.68
$ 8,932
HKD
227
3.5490
807
Non-monetary item
USD
3,352
27.68
92,775
JPY
50,642
0.2405
12,179
Foreign currency
liabilities
Monetary item
USD
2,710
27.68
75,014
RMB
8
4.3415
35
Non-monetary item
USD
1,159
27.68
32,082
Foreign currency exchange gain and loss (realized and unrealized) with material effect are as follows:
2022
2021
Foreigncurrency
Exchangerate
Net exchange (loss)
gain
Exchangerate
Net exchange (loss)
gain
USD
29.805(USD: NTD)
$ 1,707 28.009 (USD: NTD)
( $ 111 )		 December 31, 2022
Foreign currency
Exchange rate
Carrying amount
Foreign currency assets
Monetary item
USD
$ 2,783
30.71
$ 85,455
JPY
921
0.2324
214
HKD
355
3.938
1,399
Non-monetary item
USD
3,210
30.71
98,578
JPY
66,636
0.2324
15,486
Foreign currency
liabilities
Monetary item
USD
1,088
30.71
33,408
JPY
9,255
0.2324
2,151
Non-monetary item
USD
2,324
30.71
71,381
December 31, 2021
Foreign currency
Exchange rate
Carrying amount
Foreign currency assets
Monetary item
USD
$ 323
27.68
$ 8,932
HKD
227
3.5490
807
Non-monetary item
USD
3,352
27.68
92,775
JPY
50,642
0.2405
12,179
Foreign currency
liabilities
Monetary item
USD
2,710
27.68
75,014
RMB
8
4.3415
35
Non-monetary item
USD
1,159
27.68
32,082
Foreign currency exchange gain and loss (realized and unrealized) with material effect are as follows:
2022
2021
Foreigncurrency
Exchangerate
Net exchange (loss)
gain
Exchangerate
Net exchange (loss)
gain
USD
29.805(USD: NTD)
$ 1,707 28.009 (USD: NTD)
( $ 111 )
Exchangerate

28.009 (USD: NTD)
 Net exchange (loss)
gain
( $ 111 )

29. Separately Disclosure Items

  • (1) Information on significant transactions and (2) Information on investees:

  • A. Lending of funds to others: None

  • B. Endorsement and guarantee for others. (Exhibit 1)

  • C. Marketable securities held at the end of the period (excluding investment in the equities of subsidiaries, affiliates and joint ventures). (Exhibit 2)

214

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

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

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

  • G. The purchase or sale with the related party for an amount exceeding NT$100 million or 20% of paid-in capital: None

  • H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more. None. I. Engagement in derivative transactions: None.

  • J. Information on investees (Exhibit 3)

  • (3) Information on investments in Mainland China:

  • A. The name of the investees in Mainland China, principal business, paid-in capital, investment methods, capital outward and inward remittances, shareholding, investment gains and losses, investment carrying amount at the end of the period, repatriated investment gains and losses, and investment quota for Mainland China. (Exhibit 4)

  • B. The following significant transactions with investees in Mainland China, directly or indirectly through third regions, and their prices, payment terms, and unrealized gains or losses: None

    • a. Amount and percentage of purchases and related payables at the end of the period.

    • b. Amount and percentage of sales and related receivables at the end of the period.

    • c. Amount of property transaction and amount of the profit or loss so incurred.

    • d. Balance and purpose of endorsement and guarantee or collateral provided at end of the period.

    • e. Maximum balance, ending balance, interest rate range and total current interest amount of financial accommodation.

    • f. Other transactions that have a significant effect on the current profit or loss or financial position, such as the provision or receipt of services.

  • (4) Information on major shareholders: Name, number and percentage of shares held by shareholders with 5% or more of the ownership. (Exhibit 5)

215

SYSCOM COMPUTER ENGINEERING CO. Endorsement and guarantee for others 2022

Exhibit 1

(In Thousands of New Taiwan Dollars/Foreign Currency)

No. Name of the
company
providing
endorsement and
guarantee		 Partyendorsed andguaranteed Partyendorsed andguaranteed Limit on the
endorsement and
guarantee for a single
enterprise		 Balance of the
maximum
endorsement and
guarantee for the
period		 Balance of
endorsement and
guarantee at the end of
the period (Note1)
Actual amount drawn		 Amount of
endorsement and
guarantee by property		 Percentage of
cumulative
endorsement
and guarantee
to net worth of
the most recent
financial
statements (%)		 Limit on the
maximum
endorsement and
guarantee		 Endorsement
and guarantee
by parent
company for
subsidiary		 Endorsement
and guarantee
by subsidiary
for parent
company		 Endorsement
and guarantee
for Mainland
China
Name of the company Relationship
0 The Company Syscom
Computer(Shenzhen)Co.,
Ltd.
Xian Linan Computer Co.,
Ltd.
Netmaker Technology Co.,
Ltd.
Coach Technology
ManagementInc.		 Sub-subsidiary
Sub-subsidiary
Subsidiaries
Subsidiaries		 20% of the net worth
on the Company's
financial statements
for the most recent
period
$ 409,969
Same as above
Same as above
Same as above		 $ 334,739
( USD
10,900 )
60,652
( USD
1,975 )
90,000
15,000		 $ 334,739
( USD
10,900 )
60,652
( USD
1,975 )
85,0000
15,000		 $ 138,195
( USD
4,500 )
18,426
( USD
600 )
36,015
-		 $ -
-
-
-		 16.33%
2.96%
4.15%
0.73%		 50% of the net worth
on the Company's
financial statements
for the most recent
period
$ 1,024,923
Same as above
Same as above
Same as above		 Yes
Yes
Yes
Yes		 No
No
No
No		 Yes
Yes
No
No

Note1: The balance of endorsement and guarantee at the end of the period includes $18,426 thousand from Xian Linan Computer Co., Ltd., whose endorsement and guarantee duration has been approved to be extended in advance in accordance with the Company Rules Governing Endorsement and Guarantees.

Note2: Amounts in foreign currencies were translated into NTD at the exchange rate as of December 31, 2022.

216

SYSCOM COMPUTER ENGINEERING CO.

Marketable securities held at the end of the period December 31, 2022

Exhibit 2

(In Thousands of New Taiwan Dollars /Thousands of Shares (Thousands of Units))

Company held Type and name of marketable securities Relationship with the issuer of
marketable securities		 Account on the financial statements End of the period Remark
Number of
shares/units		 Carrying amount Shareholding
percentage %		 Fair value
SYSCOM COMPUTER
ENGINEERING CO.
Coach Technology Management Inc.		 Beneficial certificates
Yuanta Global Quality Leader Balanced
Fund - NTD Class A No-
Dividends/Interests
Stocks
Engsound Technical Enterprise Co.,
Ltd.
Turn Cloud Technology Service Inc.
Shin Kong Financial Holding Co., Ltd.
Dimension Computer Technology Co.,
Ltd.
Beneficial certificates
Fuh Hwa Money Market Fund		 －
－
－
－
－
－		 Financial assets at fair value through profit or
loss - current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through profit or
loss-current		 1,966
273
195
166
2
31
$ 19,505

1,595

22,650

1,457

35

451		 -
9.09
1.00
-
-
-		 $ 19,505
1,595
22,650
1,457
35
451

Note 1: Marketable securities referred to here are stocks, bonds, beneficiary certificates and marketable securities derived from the above items that fall within the scope of IFRS 9, "Financial Instruments". Note 2: The above stocks or beneficiary certificates were not pledged as collateral.

217

SYSCOM COMPUTER ENGINEERING CO. Information on investees, locations, ......, etc. 2022

Exhibit 3

(In Thousands of New Taiwan Dollars/Thousands of Shares)

Name of the investor company Name of the investee Location Principal business Original investment amount Original investment amount Holdingat the end of theperiod Holdingat the end of theperiod Holdingat the end of theperiod Profit (loss) for the
period of the investee
(Note)		 Investment income (loss)
recognized in the period		 Remark
End of the period End of last year Number of
shares		 Share-
holding %		 Carrying amount
SYSCOM COMPUTER
ENGINEERING CO.
Coach Technology
Management Inc.		 Coach Technology Management Inc.
Casemaker Inc.
SYSCOM INTERNATIONAL INC.
Netmaker Technology Co., Ltd.
Wisemaker Technology Co.
DBMaker Japan, Inc.
Syscom Computer(Thailand)Co., Ltd.
Cloudmaster Co., Ltd.
Syscom Computer(Thailand)Co., Ltd.		 Taipei City
California,
U.S.A.
Cayman
Islands
Taipei City
Taipei City
Tokyo, Japan
Thailand
Taipei City
Thailand		 Diagnostic consulting for corporate
management, domestic and foreign
investment referral, and computerized
design consulting.
Sales of computer software, hardware and
related products.
Investments in other businesses
Information software, data processing and
electronic information supply services
Sales of computer software, hardware and
related products.
Development and sales of computer system
software and hardware
Development and maintenance of software
and other businesses
Information software, data processing and
electronic information supply services
Development and maintenance of software
and other businesses		 $ 19,200
USD
1,300
USD
6,050
18,763
41,697
JPY
53,260
THB
33,014
65,000
THB
200		 $ 19,200
USD
1,300
USD
6,050
18,635
41,675
JPY
53,260
THB
33,014
65,000
THB
200		 1,950
1,300
6,050
2,858
2,665
5
3,400
6,500
20		 97.50
100.00
100.00
86.60
98.72
49.89
91.40
50.00
0.54		 $ 4,331

98,578
(
71,381 )

39,271

58,256

15,486

3,105

54,032

18		 ( $ 368 )
(
4,448 )
(
39,020 )
(
174 )

2,909

7,294
(
311 )

2,789
(
311 )
 ( $ 359 )
(
4,448 )
(
39,020 )
(
151 )

2,871
3,639
(
284 )

1,394
Not applicable		 Subsidiaries
Subsidiaries
Subsidiaries
Subsidiaries
Subsidiaries
Investee accounted for
using the equity
method
Subsidiaries
Investee accounted for
using the equity
method
Subsidiary

Note: The profit or loss of investees was expressed in NTD at the average exchange rate of 2022.

218

SYSCOM COMPUTER ENGINEERING CO. Information on investments in Mainland China 2022

2022 2022
Exhibit 4 (In Thousands of New Taiwan Dollars/Foreign Currency)
Name of the investee in
Mainland China		 Principal business Paid-in capital Investment method Accumulated investment
amount remitted from
Taiwan at the beginning
of the period		 Investment amount remitted back or
recovered during the period		 Accumulated investment
amount remitted from
Taiwan at the end of the
period		 Profit or losses of the
investee for the period		 Shareholding
percentage of
the Company's
direct or indirect
investment
Investment gain or
loss recognized for the
period
Carrying amount of
the investment at the
end of the period		 Investment income
remitted back as of the
end of the period
Remark
Outward
remittance		 Recovery
Syscom
Computer(Shenzhen)Co.,
Ltd.
Xian Linan Computer Co.,
Ltd.		 Computer equipment
software
development, sales of
self-developed
technical
achievements
services, computer
system integration
and network wiring
engineering.
Development and
production of
computer equipment
and computer
software, computer
system integration
network construction,
sales of self-produced
products, and
provision of after-
sales technical
services.
$ 138,195
(
USD
4,500 )


70,633
( USD
2,300 )		 Note 1
Note 1		 $ 128,061
( USD
4,170 )
46,618
( USD
1,518 )		 $ -
-		 $ -
-		 $ 128,061
( USD
4,170 )
46,618
( USD
1,518 )		 ( $ 27,402 )
( (USD
919 ))
(Note 2)
(
20,648 )
( (USD
693 ))
(Note 2)		 98.27%
74.38%		 ( $ 26,927 )
( (USD
903 ))
(Note 2)
(
15,358 )
( (USD
515 ))
(Note 2)		 ( $ 73,120 )
( (USD
2,381 ))
(Note 2)
(
2,746 )
( (USD
89 ))
(Note 2)		 $ -
-

Cumulative amount of investment remitted from Taiwan Investment amount approved by the Investment Limit on investments in Mainland China imposed by the Investment Commission of the Ministry of Economic to Mainland China at the end of the period Commission of the Ministry of Economic Affairs Affairs (Note 3) $ 174,678 $ 174,678 ( USD 5,688 ) ( USD 5,688 ) (Note 1(2)) $ 1,229,907 13,396 ( USD 436 ) (Note 1(1))

Note 1: Investment methods are classified into the following two categories:

(1) The investment was made through the Company's 100%-owned subsidiary, Casemaker Inc.'s own capital and capital increase from capital surplus of the investee.

(2) Indirect investment through the Company's 100%-owned subsidiary SYSCOM INTERNATIONAL INC.

Note 2: Recognized on the basis of the financial statements for the year ended December 31, 2022, as reviewed by CPAs.

Note 3: The calculation of the limit in accordance with the "Regulations Governing the Examination of Investment or Technical Cooperation in Mainland China" of the Investment Commission is as follows: 60% of the net worth: $2,049,845×60% ＝ $1,229,907

Note 4: Amounts in foreign currencies were translated into NTD at the exchange rates as of December 31, 2022, except for profit or loss, which was translated at the average exchange rate for 2022.

219

SYSCOM COMPUTER ENGINEERING CO. Information on major shareholders December 31, 2022

Exhibit 5

Exhibit 5
Name of major shareholder Shareholding
Number of shares held Shareholding
percentage
Jui-Fu Liu
Kuan-Po Ding
Furly Investment Co., Ltd.
Su-Chen Yang
Chi-Shan Liu		 18,346,787
9,890,000
8,529,801
8,524,001
7,598,911		 18.34%
9.89%
8.52%
8.52%
7.59%

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

220

  • VI. If the Company or its affiliates have experienced financial difficulties in the most recent year or during the current year up to the date of publication of the Annual Report, their effects on the Company’s financial position should be stated: None.

221

Seven. Review and analysis of financial position and financial performance and risks

I.Financial Status

The annual report shall list the main reasons for any material change in the Company's assets, liabilities, or equity during the past 2 fiscal years, and describe the effect thereof. Where the effect is of material significance, the annual report shall describe the measures to be taken in response

Unit: Thousands of NTD

Year
Item		 2022 2021 Increase(decrease)
amount
change
Proportion
(%)
Current Assets
Property, Plant and Equipment
Intangible Assets
Other Assets
Total Assets
Current Liabilities
Noncurrent Liabilities
Total Liabilities
Capital Stock
Capital Surplus
Retained Earnings
Other Equity
Non-Controlling Interest
Total Stockholders' Equity		 3,764,749
357,328
2,410
310,453
4,434,940
2,284,257
95,870
2,380,127
1,000,000
1,547
1,044,551
3,747
4,968
2,054,813
3,502,741

370,818

2,743

358,027

4,234,329

2,136,747

122,825

2,259,572

1,000,000

1,547

969,490

(6,921)

10,641

1,974,757
262,008

(13,490)

(333)

(47,574)

200,611

147,510

(26,955)

120,555

0

0

75,061

10,668

(5,673)

80,056
7

(4)

(12)

(13)

5

7

(22)

5

0

0

8

154

(53)

4
1. Analysis of change in percentage:
(1)The decrease in non-current liabilities: Mainly due to the amortization of lease liabilities over
time.
(2)The increase in other equity: Mainly due to the increase in exchange differences on translation
of financial statements of foreign operations.
2. Future countermeasures: None.

222

II. financial performance

(I)Analysis of financial performance

Unit:Thousands ofNTD
Year
Item
2022
2021
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
5,950,524
5,869,595
80,929
1
Operating costs
4,432,024
4,445,332
(13,308)
0
Gross profit
1,518,500
1,424,263
94,237
7
Operating expenses
1,254,095
1,169,437
84,658
7
Profit from operations
264,405
254,826
9,579
4
non-operating income and expenses
40,251
17,031
23,220
136
Profit before income tax
304,656
271,857
32,799
12
Income tax
59,711
56,880
2,831
5
Net profit
244,945
214,977
29,968
14
Other comprehensive income for the
year, net of income tax
25,146
15,297
9,849
64
Total comprehensive income
270,091
230,274
39,817
17
Net proif attributable to Owners Of
the Company
250,730
215,822
34,908
16
Total comprehensive income
attributable to Owners Of the
Company
275,729
231,189
44,540
19
1. Analysis of change in percentage：
(1)The increase in non-operating income and expense: Mainly due to the increase in government
grants in 2022.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2022:
Please refer to the Market, production and sales overview of Operations overview in this Annual
Report.		 Unit:Thousands ofNTD
Year
Item
2022
2021
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
5,950,524
5,869,595
80,929
1
Operating costs
4,432,024
4,445,332
(13,308)
0
Gross profit
1,518,500
1,424,263
94,237
7
Operating expenses
1,254,095
1,169,437
84,658
7
Profit from operations
264,405
254,826
9,579
4
non-operating income and expenses
40,251
17,031
23,220
136
Profit before income tax
304,656
271,857
32,799
12
Income tax
59,711
56,880
2,831
5
Net profit
244,945
214,977
29,968
14
Other comprehensive income for the
year, net of income tax
25,146
15,297
9,849
64
Total comprehensive income
270,091
230,274
39,817
17
Net proif attributable to Owners Of
the Company
250,730
215,822
34,908
16
Total comprehensive income
attributable to Owners Of the
Company
275,729
231,189
44,540
19
1. Analysis of change in percentage：
(1)The increase in non-operating income and expense: Mainly due to the increase in government
grants in 2022.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2022:
Please refer to the Market, production and sales overview of Operations overview in this Annual
Report.		 Unit:Thousands ofNTD
Year
Item
2022
2021
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
5,950,524
5,869,595
80,929
1
Operating costs
4,432,024
4,445,332
(13,308)
0
Gross profit
1,518,500
1,424,263
94,237
7
Operating expenses
1,254,095
1,169,437
84,658
7
Profit from operations
264,405
254,826
9,579
4
non-operating income and expenses
40,251
17,031
23,220
136
Profit before income tax
304,656
271,857
32,799
12
Income tax
59,711
56,880
2,831
5
Net profit
244,945
214,977
29,968
14
Other comprehensive income for the
year, net of income tax
25,146
15,297
9,849
64
Total comprehensive income
270,091
230,274
39,817
17
Net proif attributable to Owners Of
the Company
250,730
215,822
34,908
16
Total comprehensive income
attributable to Owners Of the
Company
275,729
231,189
44,540
19
1. Analysis of change in percentage：
(1)The increase in non-operating income and expense: Mainly due to the increase in government
grants in 2022.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2022:
Please refer to the Market, production and sales overview of Operations overview in this Annual
Report.		 Unit:Thousands ofNTD
Year
Item
2022
2021
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
5,950,524
5,869,595
80,929
1
Operating costs
4,432,024
4,445,332
(13,308)
0
Gross profit
1,518,500
1,424,263
94,237
7
Operating expenses
1,254,095
1,169,437
84,658
7
Profit from operations
264,405
254,826
9,579
4
non-operating income and expenses
40,251
17,031
23,220
136
Profit before income tax
304,656
271,857
32,799
12
Income tax
59,711
56,880
2,831
5
Net profit
244,945
214,977
29,968
14
Other comprehensive income for the
year, net of income tax
25,146
15,297
9,849
64
Total comprehensive income
270,091
230,274
39,817
17
Net proif attributable to Owners Of
the Company
250,730
215,822
34,908
16
Total comprehensive income
attributable to Owners Of the
Company
275,729
231,189
44,540
19
1. Analysis of change in percentage：
(1)The increase in non-operating income and expense: Mainly due to the increase in government
grants in 2022.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2022:
Please refer to the Market, production and sales overview of Operations overview in this Annual
Report.		 Unit:Thousands ofNTD
Year
Item
2022
2021
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
5,950,524
5,869,595
80,929
1
Operating costs
4,432,024
4,445,332
(13,308)
0
Gross profit
1,518,500
1,424,263
94,237
7
Operating expenses
1,254,095
1,169,437
84,658
7
Profit from operations
264,405
254,826
9,579
4
non-operating income and expenses
40,251
17,031
23,220
136
Profit before income tax
304,656
271,857
32,799
12
Income tax
59,711
56,880
2,831
5
Net profit
244,945
214,977
29,968
14
Other comprehensive income for the
year, net of income tax
25,146
15,297
9,849
64
Total comprehensive income
270,091
230,274
39,817
17
Net proif attributable to Owners Of
the Company
250,730
215,822
34,908
16
Total comprehensive income
attributable to Owners Of the
Company
275,729
231,189
44,540
19
1. Analysis of change in percentage：
(1)The increase in non-operating income and expense: Mainly due to the increase in government
grants in 2022.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2022:
Please refer to the Market, production and sales overview of Operations overview in this Annual
Report.
Year
Item
2022		 2021 Increase
(decrease)
amount		 change
Proportion
(%)
Net operating revenue
Operating costs
Gross profit
Operating expenses
Profit from operations
non-operating income and expenses
Profit before income tax
Income tax
Net profit
Other comprehensive income for the
year, net of income tax
Total comprehensive income
Net proif attributable to Owners Of
the Company
Total comprehensive income
attributable to Owners Of the
Company		 5,950,524
4,432,024
1,518,500
1,254,095
264,405
40,251
304,656
59,711
244,945

25,146
270,091
250,730
275,729
5,869,595

4,445,332

1,424,263

1,169,437

254,826

17,031

271,857

56,880

214,977

15,297

230,274

215,822

231,189
80,929

(13,308)

94,237

84,658

9,579

23,220

32,799

2,831

29,968

9,849

39,817

34,908

44,540
1

0

7

7

4

136

12

5

14

64

17

16

19
1. Analysis of change in percentage：
(1)The increase in non-operating income and expense: Mainly due to the increase in government
grants in 2022.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2022:
Please refer to the Market, production and sales overview of Operations overview in this Annual
Report.

(II) Analysis of change in operating gross profit: No material change.

223

III.Analysis of Cash Flow

Unit: Thousands of NTD

Unit: Thousands of NTD Unit: Thousands of NTD
Balance of cash
at start of term		 Net cash flow
from business
activities
throughout the
year		 Net cash
flow
activities
throughout
theyear		 Balance of
cash
(shortage)		 Remedies for shortage in
cash
Investment
plan		 Wealth
management
plan
468,100 212,024 (79,183) 600,941
-		 -
1. Analysis of change in cash flows for the year:
(1) Operating activities: The net cash inflows from operating activities were $212,024 thousand,
mainly due to the increase in net profit for the period.
(2) Investing activities: The net cash inflows from investing activities were $114,214 thousand,
mainly due to the disposal of financial assets at fair value through profit or loss.
(3) Financing activities: Net cash outflows from financing activities were $203,637 thousand,
mainly due to the payment of dividends. .
2. Remedies for cash shortage and liquidity analysis: Not applicable
3. Liquidity analysis for the coming year:
The Company expects to generate positive cash flows from operating activities in the coming
year, and the cash outflows are expected to be mainly from the payment of cash dividends.
Cash balance at the beginning of the year: $600,941 thousand
Estimated net cash inflows from operating activities for the whole year: $258,986 thousand
Estimated cash outflows for the whole year: $294,180 thousand
Estimated cash surplus(shortage):$565,747 thousand

IV. Major Capital Expenditure Items and Source of Capital: None.

  • V. Investment Policy in the Last Year, Main Causes for Profits or Losses, Improvement Plans, and Investment Plans for the Coming Year

In terms of the Company’s policy on investments in other businesses, in addition to strategic investments, the focus is to expand its markets or to establish value chain integration relationships to strengthen corporate value.

The decrease in profit or loss of the Company's investees in 2022 compared to 2021 was mainly due to the impact of the local pandemic control measures, the increasing complexity of the U.S.-China competition and the slowdown of the global economy, which resulted in lower than expected order booking. The Company will continue to implement its production and marketing strategy and expense and cost control plan as follows:

  1. Continue to strengthen the control and management of each reinvestment company and adjust the manpower allocation in a timely manner.

  2. Strengthen customer visits and enhance customer relationships in order to grasp customer needs.

  3. Evaluate the markets of each investee, strengthen the products and services of each company, and explore other markets in a timely manner.

  4. Continue to supervise investees to actively promote the revision of production and marketing strategies in accordance with market demands

Investment plans for the coming year: None.

224

VI. Analysis of Risk Management

  • (I) Effects of Changes in Interest Rates, Foreign Exchange Rates and Inflation on Corporate Finance, and Future Response Measures.
Effects of Changes in Interest Rates, Foreign Exchange Rates and Inflation on
and Future Response Measures.		 Effects of Changes in Interest Rates, Foreign Exchange Rates and Inflation on
and Future Response Measures.
1. Effect onthe Company's profit andloss: None:
Item 2022 (Thousands of NTD，%)
Net interest income and expense (3,783)
Net exchange gain or loss (10,297)
Net interest income and expense as a
percentage of net revenue		 (0.06%)
Net interest income and expense as a
percentage of net profit before tax		 (1.24%)
Net exchange gain or loss as a percentage
of net revenue		 (0.17%)
Net exchange gain or loss as a percentage
of net profit before tax		 (3.38%)
  • (1) Change in interest rate

The Company's financial assets and financial liabilities exposed to cash flow risk arising from change in interest rate amounted to $293,368 thousand and $15,422 thousand, respectively, at the end of 2022. The Company's short-term borrowings are fixed-rate debts, so there was no cash flow risk arising from change in market interest rate.

  • (2) Change in exchange rate

Although the Company has foreign currency denominated cash flows for import and export operations, the impact of change in exchange rate on costs and revenues is not material.

  • (3) Inflation

The average consumer price index in Taiwan increased at an annual rate of approximately 2.95% in 2022. The Company keeps an eye on the fluctuation of market prices and maintains good interaction with suppliers and customers, and there has been no material impact due to inflation in recent years.

  1. Future countermeasures:

  2. (1) Countermeasures for change in interest rate

  3. A. The Company does not have a large amount of long-term capital shortage. In addition to the preferential interest rate that the Company has obtained from banks, the Company also evaluates the reasonableness of the borrowing rate from banks from time to time in order to actively obtain preferential borrowing rate.

  4. B. The Company uses its idle funds to make short-term investments to reduce interest rate losses and increase non-operating profit in response to possible increases in interest rates.

  5. (2) Countermeasures for change in exchange rate

  6. In response to exchange rate fluctuations, the Company collects foreign exchange information to keep abreast of exchange rate trends and consults with banks for professional advice, and adopts the principle of exchange rate diversification to reduce the impact of foreign currency exchange rate fluctuations on operating profit or loss.

  7. (3) Inflation

The Company keeps an eye on the fluctuation of market prices, adjusts its import and export prices in accordance with the market fluctuations, and maintains good interaction with suppliers and customers, and there has been no material impact due to inflation in recent years.

  • (II) Policies, Main Causes of Gain or Loss and Future Response Measures withRespect to High-risk, High-leveraged Investments, Lending or EndorsementGuarantees, and Derivatives Transactions. ：

  • The Company did not engage in any high-risk, high-leverage investments, lending funds others in the most recent year.

  • The Company has established the "Procedures for Engagement in Derivative Transactions" to regulate the risk management system of derivative transactions and did not engage in investments in derivative instruments in the most recent year and the current year up to the date of publication of the Annual Report.

  • In the most recent year, the Company provided financing endorsements and guarantees in the amount of $85,000 thousand for the subsidiary, Netmaker Technology Co., Ltd., $15,000 thousand for the subsidiary, Coach Technology Management Inc., $334,739 thousand for the sub-subsidiary, Syscom Computer(Shenzhen)Co., Ltd., and $60,652 thousands for the sub-subsidiary, Xian Linan Computer Co., Ltd.. Handled in accordance with the "Endorsement and Guarantee Regulations"

225

established by the Company.

  • (III)Future R&D plans and estimated R&D expenses to be invested in

  • 1.Future R&D plans and estimated R&D expenses to be invested in

Unit: Thousands of NTD
Name of future R&D projects Estimated further
investment in R&D
expenses
Opus One IP Continuous Configuration Management
Platform (Version 1.5.4)		 500
Opus One IP Continuous Configuration Management
Platform (Version 1.5.5)		 5,000
Hyper Automation Scanning Task Framework 5,000

2.R&D investment plan and progress:

Name of R&D projects Current
progress		 Contents of the plan Estimated
completiontime
Opus One IP Continuous
Configuration Management
Platform (Version 1.5.4)		 60% Add/Improve the following as the Opus
One features for high capacity and
intelligent management have been added
to achieve the goal of supporting
automated
data
center
continuous
configuration management:
⚫ Conduct research and design of
common modules and microservices
to reduce the cost of other continuous
configuration management software
or
project
customization
development, making Opus One
more flexible in its ability to support
various
types
of
projects
and
enhancing investment efficiency.
⚫ Continue to add Agent Plug-In scripts
for
various
types
of
device
management
to
expand
the
management capacity and enhance
the ability to support IT continuous
configuration management in data
centers.
Conduct
research
and
design
for
configuration
correlation
database
CMDB module to provide network
management information and personnel,
event and service, and event impact
analysis functions, and provide event
managementfunctions.
























2023/06
Opus One IP Continuous
Configuration Management
Platform (Version 1.5.5)		 2% Add/Upgrade the following continuous
configuration management module for
Opus One to provide intelligent and
automatic management functions such as
automatic assignment, tracking and
auditing of continuous configuration
events in data center networks and
systems. configuration work and product
competitiveness.
⚫ Conduct research on continuous
configuration job service module to
design dynamic job Form Flow and
interface for receivingautomatic and











2024/08

226

manual job input.
⚫ Conduct research and design of
integrated Opus One event access and
response interface.
⚫ Conduct research and design for the
integration of CMDB's network,
system, and personnel configuration
data to assist in automatic problem
and job correlation functions.
⚫ Conduct research and design for work
trackingmanagement.





Hyper Automation Scanning
Task Framework		 8% "Hyper Automation Scanning Task
Framework"
is
a
reusable
Hyper
Automation Scanning Task Framework
that can effectively reduce the use of
scanning OP manpower and shorten the
scanning time. Whether it is for
information
security
reasons,
an
information security inspection tool is
used to scan all files in a project. Or to
reduce legal risks, use scanning software
is used to scan all free and open source
software for all files of the project, all of
which the following common features:
scanning application, file uploading
account
setting,
notification
of
encryption
and
uploading
method,
automatic
downloading,
automatic
decompression, automatic scanning and
sending of scanning reports, etc. All the
above operations are included in this
framework.



















2023/12

  • (IV)Effects of and Response to Changes in Policies and Regulations Relating to Corporate Finance and Sales ： None.

  • (V)Effects of and Response to Changes in Technology(including Information security risk) and the Industry Relating to Corporate Finance and Sales ：

The Company continues to pay attention to market changes and related technology development trends, actively grasp market opportunities, and strive to develop new products and new customer sources to enhance the company's long-term competitiveness.

The Company has long been committed to the control of information security and personal data protection, and has established a multi-layered security control and protection network and implemented a strict information security and joint prevention mechanism;

During the current year up to the date of publication of the Annual Report, no changes in technology (including information security risks) and the industry have affected the Company's financial and business matters.

  • (VI)The Impact in Corporate Image on Corporate Risk Management, and the Company’s Response Measures ： None.

  • (VII)Expected Benefits from, Risks Relating to and Response to Merger and Acquisition Plans ： None.

(VIII)Expected Benefits from, Risks Relating to and Response to Factory Expansion Plans: None.

  • (IX)Risks Relating to and Response to Excessive Concentration of Purchasing Sources and Excessive Customer Concentration: None.

  • (X)Effects of, Risks Relating to and Response to Large Share Transfers or Changes in Shareholdings by Directors,or Shareholders with Shareholdings of over 10%: None.

  • (XI)Effects of, Risks Relating to and Response to the Changes in Management Rights: None.

227

  • (XII)Litigation or Non-litigation Matters: None.

(XIII)Other Major Risks and countermeasures:

Risk management policy and organizational structure:

  1. Risk management policy:

  2. (1) Risk management is the guiding principle.

  3. (2) Establish a risk management mechanism with early assessment and measurement, effective monitoring and strict control.

  4. (3) Strive to control risks within acceptable or controlled limits.

  5. (4) All employees are aware of risks and continuously carry out risk control in the execution of their businesses.

  6. Risk management organizational structure:

  7. (1) Board of Directors

The Board of Directors of the Company is the highest unit of risk management and shall approve the risk management policy and structure, and is responsible for approving, reviewing, and monitoring the Company's risk management policy to ensure the effectiveness of risk management.

  • (2) Risk Management Group

The Risk Management Group is the responsible unit for executing risk management and is responsible for the monitoring, measurement and evaluation of the company's risk at the execution level. The Risk Management Group is directly under the President and reports its operation to the Board of Directors at least once a year.

The risk management of each operation of the Company is divided among relevant units according to the nature of their businesses, and the main risk management units of each operation are described as follows.

Responsible
unit		 Responsibilities
Marketing
Division		 Responsible for developing the company's marketing strategy, product
strategy, product pricing, market information collection and establishment,
etc. to reduce strategic risks and business operation risks.
Administration
and Planning
Division		 Responsible for human resources management, asset security management,
promotion of corporate social responsibility and ethical corporate
management (including the formulation of related policies, systems and
related risk assessment) to reduce related risk losses.
Finance
Division		 Responsible for financial capital deployment and utilization, and timely use
of hedging mechanisms to reduce financial risks in response to changes in
exchange rates and interest rates.
Computer
Center		 Responsible for information security control and protection measures to
reduce information security risks.
Audit Office Responsible for auditing the implementation of internal control systems for
business, finance and operations of each unit to strengthen the function of
internal control system.
Each execution
unit		 Responsible for analyzing and monitoring the management of business risks
in their respective units to ensure effective implementation of risk control
mechanisms and procedures.

VII.Other material matters: None.

228

Eight. Special matters

  • I. Information about the Company’s Affiliates

  • (I)Organization chart (December 31,2022)

Syscom Computer Engineering Co.

==> picture [463 x 412] intentionally omitted <==

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

CASEMaker Coach Syscom Netmaker Wisemaker Syscom
Inc. Technology Computer Technology Technology Int ’l lnc.
100% Management (Thailand) Co., Ltd. Co. 100% I
Inc. Co., Ltd. 86.60% 98.72%
97.50% 91.4%
Syscom Xian Linan
Computer Computer
(Shenzhen) Co., Ltd.
Co., Ltd. 74.38%
98.27%
----- End of picture text -----

229

(II) Basic data of affiliates(December 31,2022)

Name Date Address Paid-in capital Main business
CASEMaker
Inc.		 Sep.17,1991 1680 CIVIC CENTER
DRIVE SANTA
CLARA ,CA 95050 U.S.A
USD 1,300
thousand		 Sales of computer software,
hardware and related products.
Coach
Technology
Management
Inc.		 Sep.15,1992 2F.,No. 24, Kangding Rd.,
Wanhua Dist., Taipei City
108 , Taiwan (R.O.C.)		 NTD 20,000
thousand		 Diagnostic consulting for
corporate management,
domestic and foreign
investment referral, and
computerized design consulting.
Syscom
Computer
(Thailand)
Co., Ltd.		 Apr.22,1998 Thaniya Plaza Building,
Room A, 14th Floor, 52
Silom Road, Suriyawong,
Bangrak, Bangkok 10500		 THB 37,200
thousand		 Development and maintenance
of software and other
businesses.
Netmaker
Technology
Co., Ltd.		 July 1,2000 2F.,No. 24, Kangding Rd.,
Wanhua Dist., Taipei City
108 , Taiwan (R.O.C.)		 NTD 33,000
thousand		 Information software, data
processing and electronic
information supply services.
Wisemaker
Technology
Co.		 July24,2001 3F.-1,No.115,Emei St.,
Wanhua Dist., Taipei City
108, Taiwan (R.O.C.)		 NTD 27,000
thousand		 Sales of computer software,
hardware and related products.
Syscom
International
Inc.		 Mar.7,2002 Scotia Centre,4thFloor,
P.O.Box2804,George
Town,Grand Cayman,
Cayman Islands.		 USD 6,050
thousand		 Investments in other businesses.
Syscom
Computer
(Shenzhen)
Co., Ltd.		 May 2,1995 Unit A,44 / F, Times
Fortune Building,
No.88,Fuhua Rd.3.,
CBD,Shenzhen,
Guangdong P.R.C.		 USD 4,500
thousand		 Computer equipment software
development, sales of self-
developed technical
achievements services,
computer system integration
and network wiring
engineering.
Xian Linan
Computer Co.,
Ltd.		 May 27,1997 4# BUILD 3F HUOJU
ROAD.XI'AN,CHINA		 USD 2,300
thousand		 Development and production of
computer equipment and
computer software, computer
system integration network
construction, sales of self-
produced products, and
provision of after-sales
technical services.

230

(III)Information of Director,Supervisor and President in each affiliated company (December 31,2022)

Unit: Share; % Unit: Share; %
Affiliate Title Name of Representative Shareholding
Shares Shares%
CASEMaker Inc. President Syscom Computer Engineering Co.
(Representative:Jui-Long Liu)		 1,300,000
100%
Director Syscom Computer Engineering Co.
(Representative:Jui-Fu Liu)
Director Syscom Computer Engineering Co.
(Representative:Ann Wang)
Coach Technology
Management Inc.		 Chairman Syscom Computer Engineering Co.
(Representative:Chien-Kuo Chen)		 1,949,994 97.50%
Director Syscom Computer Engineering Co.
(Representative: Chih-Chung Chen)
Director Wan-Tan Lin 10,000
0.50%
Supervisor Cheng-Ling Pan 15,000
0.75%
Syscom Computer
(Thailand)Co., Ltd.		 Director Chung-Chih Hwang 50,000
1.34%
Director Jing-Shiang Hsu 25,000
0.67%
Netmaker Technology
Co., Ltd.		 Chairman Chi-Ching,Hsu 115,500
3.50%
Director Syscom Computer Engineering Co.
(Representative: Tsai-Chi Sung)		 2,857,800 86.60%
Director Syscom Computer Engineering Co.
(Representative: Ching-Tzu Shih)
Supervisor Chao-Yi Wu 16,500
0.50%
Wisemaker
Technology Co.		 Chairman Chao-Ying Tang 14,700
0.54%
Director Syscom Computer Engineering Co.
(Representative: Wan-Tan Lin)		 2,665,350 98.72%
Director Syscom Computer Engineering Co.
(Representative: Cheng-Wu Shao)
Supervisor Jia-Chang Chang 0
0%
Syscom
International Inc.		 Director Syscom Computer Engineering Co.
(Representative: Kun-Ting Chiu)		 6,050,000
100%
Syscom Computer
(Shenzhen)Co., Ltd.		 Director Syscom International Inc.
(Representative: Shih-Chieh Chen)		 - 92.67%
Director Syscom International Inc.
(Representative: Tsan-Chang Li)
Director CASEMaker Inc.
(Representative:Tzu-Hsiang Liao)		 - 5.60%
Supervisor Yu-Kang Tseng - 0%
Xian Linan Computer
Co. Ltd.		 Director Syscom International Inc.
(Representative: Tsan-Chang Li)		 - 66.00%

Director		 Syscom International Inc.
(Representative:Chia-Hsuan Chung)
Director CASEMaker Inc.
(Representative:Tzu-Hsiang Liao)		 - 8.38%

231

(IV) Overview of the operations of the affiliates(December 31,2022)

Unit: Thousands of NTD/ Foreign currency Unit: Thousands of NTD/ Foreign currency Unit: Thousands of NTD/ Foreign currency Unit: Thousands of NTD/ Foreign currency Unit: Thousands of NTD/ Foreign currency Unit: Thousands of NTD/ Foreign currency Unit: Thousands of NTD/ Foreign currency Unit: Thousands of NTD/ Foreign currency
Affiliate Capital Total
assets		 Total
liabilities		 Total
equity		 Operating
revenue		 Operating
profit		 Net
profit		 EPS (NT$)
(after tax)
CASEMaker Inc. USD
1,300

105,896
7,318
98,578
7,604
(4,517)
(4,448)
(3.42)
Coach Technology
Management Inc.		 20,000
5,606
1,772
3,834
6,381
(360)
(368)
(0.18)
Syscom Computer
(Thailand)Co., Ltd.		 THB
37,200

5,488
2,091
3,397
3,240
(310)
(311)
(0.08)
Netmaker
Technology Co., Ltd.		 33,000
123,053
77,706
45,347
157,622
2,188
(174)
(0.05)
Wisemaker
Technology Co.		 27,000
69,907
10,894
59,013
45,410
3,334
2,909
1.08
Syscom International
Inc.		 USD
6,050

(71,381)
0
(71,381)
0
0
(39,020)
(6.45)
Syscom Computer
(Shenzhen) Co., Ltd.		 USD
4,500

98,986
173,396
(74,410)
107,320
(10,293)
(27,402)
-
Xian Linan
Computer Co. Ltd.		 USD
2,300

26,664
30,357
(3,693)
32,956
(20,171)
(20,648)
-

Note: If the affiliated company is a foreign company,the relevant amount are converted into NT dollars based on the exchange rate on the reporting date.

(V) Consolidated financial statements of affiliated companies ： Please refer to Page.125

II. Private Placement Securities in the Most Recent Years ： None

III.Shares in the Company Held or Disposed of by Subsidiaries in the Most Recent Years: None.

IV.Other supplementary information ： None.

  • V.Any of the situations listed in Article 36, paragraph 3, subparagraph 2 of the Securities and Exchange Act, which might materially affect shareholders' equity or the price of the company's securities, has occurred during the most recent fiscal year or during the current fiscal year up to the date of publication of the annual report: None.

232

SYSCOM COMPUTER ENGINEERING CO.

Chairman Jui-Fu Liu

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