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SYSCOM Annual Report 2023

Jun 28, 2024

52093_rns_2024-06-28_160c256a-e30f-4538-9c98-c0d14bb6cd60.pdf

Annual Report

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Stock Code: 2453

SYSCOM COMPUTER ENGINEERING CO.

2023

Annual Report

Printed on April 14, 2024

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 2023 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: Li-Wen Kuo, 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 ..................................................................... 11
I. Organizational System .......................................................................... 11
II. Information on Directors, President, vice president, assistant VP, heads
of departments and branches ................................................................. 14
III. Remuneration paid to directors (including independent directors),
president and vice president for the most recent fiscal year ................. 29
IV. Operations of corporate governance ..................................................... 38
V. Information on CPA professional fees .................................................. 81
VI. Information on Replacement of CPAs .................................................. 82
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 . 82
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..................... 82
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 .............................................................................................. 86
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 .................................................................... 87
Four. Fund raising.................................................................................................... 88
I. Capital and stock ................................................................................... 88
II. Issuance of Issuance of Corporate Bonds ............................................. 91
III. Issuance of preferred shares .................................................................. 91
IV. Issuance of Global Depositary Receipts ............................................... 91
V. Employee Share Subscription Warrants ................................................ 91
VI. New Restricted Employee Shares ......................................................... 91
VII. Issuance of new shares in connection with mergers or acquisitions of
shares of other companies ..................................................................... 91
VIII. Capital utilization plan and implementation status ............................... 91
Five. Operations overview ...................................................................................... 93
I. Business activities ................................................................................. 93
II. Market, production and sales overview .............................................. 106
III. Information on employees .................................................................. 112
IV. Information on environmental protection expenditures ..................... 112
V. Labor relations .................................................................................... 112
VI. Cyber security management ................................................................ 115
VII. Important contracts ............................................................................. 117
Six. Financial position ........................................................................................... 118
I. Condensed Balance Sheets and Statements of Comprehensive Income for
the most recent 5 years ........................................................................ 118
II. Financial analysis for the most recent 5 years .................................... 122
III. Audit Committee’s review reports on the financial statements for the
most recent year .................................................................................. 126
IV. Financial statements for the most recent year ..................................... 127
V. Parent company only financial statements for the most recent years
audited and attested by CPAs .............................................................. 178
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 ...................................................... 225
Seven. Review and analysis of financial position and financial performance and
risks ..................................................................................................... 226
I. Financial Status ................................................................................... 226
II. financial performance ......................................................................... 227
III. Analysis of Cash Flow ........................................................................ 228
IV. Major Capital Expenditure Items and Source of Capital .................... 228
V. Investment Policy in the Last Year, Main Causes for Profits or Losses,
Improvement Plans, and Investment Plans for the Coming Year ....... 228
VI. Analysis of Risk Management ............................................................ 229
VII. Other material matters ......................................................................... 232
Eight. Special matters ............................................................................................ 233
I. Information about the Company’s Affiliates ...................................... 233
II. Private Placement Securities in the Most Recent Years ..................... 236
III. Shares in the Company Held or Disposed of by Subsidiaries in the Most
Recent Years. ....................................................................................... 236
IV. Other supplementary information. ...................................................... 236
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 ........................................ 236

One. Letter to Shareholders

Dear shareholders:

The rise of generative AI applications in 2023 has created business opportunities in the related supply chain and applied services, and it has further demonstrated the huge influence of AI technology development in driving industrial transformation and even reshaping industrial structure; the government’s digital policies create new economic model as the development direction to help industries upgrade and solve social problems. Many industries in Taiwan are actively introducing related technologies and applications, thereby driving business opportunities in the information service industry. With the joint efforts of all employees, Syscom fulfilled the goals set by the Company and continued to integrate cutting-edge technologies. With its core software and hardware products, innovative R&D technologies, and professional services, the Company successfully assisted in the upgrading and transformation of the industry, boosting its 2023 revenue and profit to record highs in recent years.

An overview of our operations for 2023 and the outlook for 2024 are hereby reported:

I. 2023 Business Report

1. Business plan implementation results:

The Company's consolidated net operating revenues for 2023 were NT$ 6,383,820 thousand, up 7.28% over 2022, and consolidated net profit after tax was NT$ 276,638 thousand, up 12.94% over 2022.

2. 2023 budget implementation status:

The Company did not prepare and announce the financial forecast for 2023, and the consolidated profit or loss for 2023 is hereby presented as follows:

Unit: Thousands of NTD

Unit: Thousands of NTD
Item Actual amount
Net operating revenue 6,383,820
Operating costs 4,722,942
Gross profit 1,660,878
Operating expenses 1,375,419
Operating profit 285,459
Non-operating income and
expenses		 44,048
Net profit before tax 329,507
Net profit for the year (after tax) 276,638

1

3. Analysis of financial receipts and expenditures and profitability for 2023:

Unit: Thousands of NTD Unit: Thousands of NTD
Item 2023 2022
Net operating revenue 6,383,820 5,950,524
Profit or loss after tax 276,638 244,945
Return on assets (%) 6.26 5.80
Return on shareholders’equity (%) 13.26 12.16
Net profit before tax as a percentage of
paid-in capital (%)		 32.95 30.47
Net profit margin (after tax) 4.33 4.12
Earnings per share (NTD) 2.78 2.51

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. CMMI Software Development Process Solution – SDPM

  11. Software Productivity Recursive Performance Prediction Model

  12. Next Generation Healthcare Information Syscom

  13. Futures Risk Control Rapid Mid-End System

  14. Securities Risk Control Rapid Mid-End System

  15. NCBS

  16. New Generation Securities and Futures Trading System

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

  18. Mobile Payment System

  19. NETCenter

  20. GreenMaker

  21. Cloud-Based Cross-Border Project Management Service

  22. Security Information Service Platform/Diamond Guard

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

  24. Intelligent Analysis and Decision Support System

  25. Real-time satellite image reception and processing

  26. Patrol box electronic

  27. VIAMaster

  28. SERVICE Online

  29. Technical Service Management (TSM)

  30. OMFLOW

  31. Hyper Automation Log Archiving Management System

  32. SECURITY USER INTERFACE PROGRAM

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

  34. Big data database multi-level dynamic column R&D project

  35. Java Database Connectivity Native Protocol Driver Interface R&D Project

  36. Hyper Automation Scanning Task Framework(Hyper Automation Scanning Task Framework)

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

  38. Secure Terminal Emulator – DRSE

  39. Intelligent service robot - AYUDA

  40. DBMaker Docker Image

  41. Shopping mall service robots

  42. Anti-pandemic service robots

  43. OMFLOW Continuous Configuration Automation module

  44. Opus One IP Continuous Configuration Management Platform (Version 1.5.5 and 1.5.6)

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) Master advanced technologies and accelerate the integration of industrial applications for swift deployment.

  • (3) Enhance the functionality of our proprietary products and broaden their application domains.

  • (4) Strengthen international collaboration and expand our overseas markets with soft power.

  • (5) Drive the Company’s digital sustainability through generative AI in a dual-axis transformation.

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) Innovate with generative AI, 5G, cloud services, and information security technologies.

  • (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

In response to geopolitical risks and compliance requirements, the Company continues to invest in IT services to improve operational efficiency, and is planning global operations to build a resilient enterprise. Emerging digital technologies such as cloud computing, big data, IoT, AI, and blockchain have the dual effect of assisting enterprises’ digital transformation and accelerating ESG transformation. They are known as “dual-axis transformation” and drive the development of the overall information service market.

With geopolitical conflicts breaking out at multiple locations around the world, building a resilient and trustworthy organization and supply chain has become a top priority. In addition to continuing to promote the “six core” strategic industries of information and digital, the government is also developing the “five trusted industries” of artificial intelligence to promote the “AI industrialization, industrial AI-ization” and the use of artificial intelligence to join hands with industries to innovate cross-disciplinary applications. In addition, the Digital Department is working on the “Great Software Project” to make good use of Taiwan’s hardware advantages to drive the development of the software industry and promote the upgrade of Taiwan's software industry environment. It is expected to build the software industry into Taiwan’s new trillion industry and create a golden decade for Taiwan's software industry.

According to an IDC survey report, enterprises are migrating to the cloud, and hybrid environment management has become the focus of growth in the information service market, such as hybrid cloud management, industrial cloud, cloud security solutions and more; it is predicted that the overall ICT expenditure of Taiwan’s industry will reach 3.7% in 2024, particularly in terms of IT spending, where the growth rate jumped to 5%, of which software services were the highest at 7.2%, followed by hardware at 4.8%.

IV. The Company's future development strategy

  1. Short-term development plan

  2. (1) Integrate system management tools to improve the efficiency and quality of corporate operations.

  3. (2) Expand core products and professional technical services to improve overall profitability.

  4. (3) Develop a knowledge-based economy that includes generative AI, cloud services, 5G, and information security.

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

  6. (5) Alliance with outstanding domestic manufacturers to explore business opportunities in

3

various industries at home and abroad.

  1. Long-term development plan

  2. (1) Cultivate high-quality IT talents and implement continuous improvement of total quality.

  3. (2) Enhance corporate growth and innovation, and commit to the sustainable development of ESG.

  4. (3) Demonstrate powerful system capabilities and help enterprises upgrade digital transformation with the results of generative AI.

  5. (4) Bridging the application of cutting-edge technology industries and forming an alliance with Taiwan team for World Cup.

In 2024, the global economic environment tends to be conservative and the overall environment is full of uncertainties. However, with technological innovation and policy support, the demand for cloud, information security, generative AI, and net zero carbon reduction will continue to grow. Syscom continues to demonstrate strong system integration capabilities and seize opportunities to break new ground. As one of the most large-scale and influential system integration companies in Taiwan, Syscom is approaching its 50th anniversary. We hope that all employees will continue to work hard and innovate bravely to create long-lasting business performance and work together for the sustainable development of the company. 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

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.

9

  • Year Important Milestones 2023[][“TRITON” satellite was launched, and SYSCOM’s “ground control system” and ] “satellite control system” was officially launched too.

  • The self-developed product “ OMFLOW Enterprise Process Engine ” was recognized by the “ Taiwan Excellence Award ” (2023, 2024).

  • The self-developed “Intelligent Service Robot Ayuda” won the “Taiwan Excellence Silver Award” again (2021 Taiwan Excellence Award Silver Award, 2023 Taiwan Excellence Award and 2024 Taiwan Excellence Silver Award).

  • Passed Cisco's rigorous evaluation and technical requirements and was awarded again CISCO’s highest-level “Gold Certified Partner” (1999-2024).

  • Continued third-party certification of information security management system, personal information management system, privacy information management system, and information service management system.

  • 2024[][ Won the ] [“][27th National Quality Award - Industry Support Model Award] [”][. ]

  • Awarded CIO TAIWAN "Outstanding Service Provider" (2022, 2024).

  • Honored with Cisco’s "Best Data Center Partner in Greater China".

  • Continue to grow

10

Three. Corporate Governance Report

  • I. Organizational system

  • (I) Organization chart

==> picture [357 x 634] intentionally omitted <==

11

(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.
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 of each unit.

12

  • (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 2023 and the plan for 2024 were reported to the Board of Directors on December 14, 2023.

13

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 14,2024
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
0
0
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
51~60 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.

14

(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, President of
NationalQuality and SustainableExcellenceAlliance		 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

15

  • (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 51 to 60. The Company has two female directors, and the proportion of female directors is 29%. The target of increasing the number of female directors to over 25% has been achieved, and the Company has planned to increase the number of female directors to over one-third.

  • 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 “Procedures for 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.

16

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

As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024 As of April 14,2024
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 15)
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 0 0 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. 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 0 0 0 0 0 0 Department of Electricity and Information
Technology, National Taipei College of
Business		 Note 3 None None None -
Vice President R.O.C. Chen-
Huan Li		 Male 2007.06.01 6,689 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 4 None None None -
Vice President R.O.C. Chin-
Fen Yu		 Female 2015.03.26
1,552
0
0
0
0
0		 Bellevue University MBA None None None None -
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 -

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 15)
Number of
shares
Shareholding
percentage
Number
of shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
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 5 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 -
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 6 None None None -
Principal
Division Chief		 R.O.C. Jia-
Chang
Chang		 Male 2005.06.01 2,000
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 7 None None None -
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 8		 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 15)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
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		 Note 9 None None None -
Chief Finance
Officer		 R.O.C. Li-
Chueh
Du		 Female 2000.06.19 6,793 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
Deng		 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 -
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 -

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 15)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
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 25,340 0.03 617 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 0 0 0 0 0 0 Institute of Traffic and Transportation Studies,
NationalChiaoTung University		 None None None None -
Principal
DivisionChief		 R.O.C. Te- Li
Chen		 Male 2012.03.21 221 0 0 0 0 0 Department of Electric Engineering, National
TaipeiUniversity of Technology		 None None None None -
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-sen 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 15)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
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 -
Senior 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 -
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 -

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 15)
Number
of shares		 Shareholding
percentage
Number of
shares
Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
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 -
Senior 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 Senior
Division
Chief
Hung-
Yi Lin		 Man and
wife		 -
Principal
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 -
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 -

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 15)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
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 -
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-
Hua
Liu		 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 -
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 -

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 15)
Number
of shares		 Shareholding
percentage
Number of
shares
Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
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
TimesFinancial InformationCo.,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 -
Project 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.		 None None None None -
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 IntegrationCo.,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 -

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 15)
Number
of shares		 Shareholding
percentage
Number of
shares
Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job title Name Relationship
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
ProjectManagerof TatungInfocommCo.,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 -
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 -

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 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
15)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
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 1,000 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 -
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 -

26

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
15)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
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 -
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
University of Science and Technology		 None None None None -
Acting 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
University of 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 Wang Co., 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 -
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 -

27

Job title Nationality
Name		 Gender Date elected Number of shares held Number of shares held Shareholding
minor c		 of 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 t
Spouse or relat
second degree of
are officers of t		 ives within
kinship who
he Company		 Remark
(Note
15)
Number of
shares		 Shareholding
percentage
Number of
shares		 Shareholding
percentage
Number
of
shares
Shareholding
percentage		 Job
title		 Name Relationship
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. 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 -
Acting Assistant VP R.O.C. Yu-Chiang
Huang		 Male 2023.06.01 0
0
0
0
0
0		 Department of Biomechatronics Engineering, National
Taiwan University		 None None None None -
Project Division
Chief		 R.O.C. Ho-Wen
Chen		 Female 2023.07.17 0
0
0
0
0
0		 Doctoral Candidate of Information and Financial
Management Group, National Taipei University of
Technology; System Analyst of Information Room of Tri-
Service General Hospital		 None None None None -
Senior Assistant VP R.O.C. Hsiao-Shu
Ma		 Male 2023.09.01 0
0
0
0
0
0		 Department of Electronic Engineering, Southern Taiwan
University		 None None None None -
Project Assistant VP R.O.C. Hsiu-Hsien
Wu		 Male 2023.11.01 0
0
0
0
0
0		 Department of Life Science, Fu Jen Catholic University,
Sales Manager of Taiwan Microsoft Public Business
GroupEducation Certification		 None None None None -

Note 1: Director of CASEMaker,Inc., director of Actisys International Corporation Note 2: President of CASEMaker Inc. Note 3: Legal representative of the director of Cloudmaster Co., Ltd.

Note 4: Chairman of Furly Investment Co., Ltd. Note 5: Legal representative of the director of Syscom Computer(Shenzhen)Co., Ltd., legal representative of the director of Xian Linan Computer Co., Ltd. Note 6: Legal representative of the director of Netmaker Technology Co., Ltd.

Note 7: Supervisor of Wisemaker Technology Co. Note 8: Legal representative of the director of Netmaker Technology Co., Ltd. Note 9: Director of Syscom Computer(Thailand)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: 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.

28

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 30 30
510
0.18%

510
0.18%

7,628		 8,338
0
0		 50
0
50		 0
8,188
2.94%

8,898
3.20%

None
Jui-Long Liu
Po-Wen Wang
Chih-Chun Liu
Independent
Director		 Wang-Ying Yu 360
360
0
0
0
0
54
54
414
0.15%
414
0.15%
0
0
0
0
0
0
0
0
414
0.15%

414
0.15%
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, 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.

29

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

30

(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 64,561 65,651 1,891 1,891 349 349 373 0 373 0 67,174
24.14%		 68,264
24.53%		 None
President Jui-LongLiu
VicePresident Chin-HsiangHsu(Note1)
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
Sales Vice President Kuang-KengLiang
Sales Vice President Shu-ChingLin
Sales VicePresident Ming-FengLi

Note 1: Left office on Decembe 31, 2023.

.

31

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 None None
$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, Ming-Feng Li		 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, Ming-Feng Li
$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 Yu		 Jui-Long Liu, Chao-Lai Wu, Chen-Huan Li,
Chun-Cheng Li, Shun-Liang Hsieh, Chin-Fen Yu
$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

32

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

December 31, 2023
Unit: Thousands of NTD		 December 31, 2023
Unit: Thousands of NTD		 December 31, 2023
Unit: Thousands of NTD		 December 31, 2023
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 2,387 2,387 0.86%
President Jui-Long Liu
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 Yu
Vice President Nai-ChengCheng
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-ChengChen
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 Deng
Principal Division
Chief		 Po-Shu Hsueh
Assistant VP Kai-TsungWang
Principal Division
Chief		 Cheng-Wu Shao

33

Managerial Officer 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
Senior Assistant VP Xueshu Ma
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 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
Senior 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
Senior 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
Principal Division
Chief		 Chih-Cheng Lin
Project Division
Chief		 Kang-Yuan Fan
Assistant VP Wei-Min Chen
Division Chief Wei-Jen Cheng

34

Managerial Officer Senior Division
Chief		 Yu-Ting Tseng
Assistant VP Yi-Chun Liu
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 Meng-Hung Pan
Division Chief Fan-Ying Chang
Division Chief Yu-Hsiang Lin
Division Chief Yu-Chung Huang
Project 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
Division Chief Chih-Kai Hsu
Corporate
Governance Officer		 Chun-Yen Chen
Division Chief Shan-Mao Cheng

35

Managerial Officer 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
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
Acting 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
Project Division
Chief		 Chi-Cheng Chih
Principal Division
Chief		 Te-Kuei Chiu
Division Chief Hung-Jui Hsieh
Division Chief Zhong-Yan Wu
Division Chief Hao-Fan Liu
Division Chief Chiung-Ying Tai
Acting Division
Chief		 Yao-Jen Yeh
Project Assistant VP
Yu-Chiang Huang
Project Division
Chief		 Ho-Wen Chen
Project Assistant VP
Hsiu-Hsien Wu

  • (IV) Compare and describe the total remuneration paid to directors, 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:

  • 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, 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
financial s		 All companies in
financial s		 the consolidated
tatement		 the consolidated
tatement
2023 2022 2023 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 8,602 3.09% 8,465 3.38% 9,312 3.35% 9,037 3.60%
President and vice
president		 67,714 24.14% 61,928 24.70% 68,264 24.53% 63,551 25.35%
Netprofit after tax 278,293 - 250,729 - 278,293 - 250,729 -
  1. The policies, standards, and portfolios for the payment of remuneration, the procedures for determining remuneration, and the correlation with business performance:

36

The remuneration for the above-mentioned personnel is based on the Company's Articles of Incorporation, the "Remuneration System for Directors, Functional Committees and Managerial Officers" and 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 2023, and has submitted the results to the Board of Directors for discussion and approval.

37

IV. Operations of corporate governance

(I) Operations of the Board of Directors:

The Board of Directors met 6 times during 2023 and the attendance of the directors was as follows:

The average percentage of attendance in person of all directors was 95.24%, 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 6 0 100% None
Director Jui-Long Liu 6 0 100% None
Director Po-Wen Wang 5 0 83% None
Director Chih-Chun Liu 5 0 83% None
Independent Director Che-Fu Kung 6 0 100% None
Independent Director Wang-Ying Yu 6 0 100% None
Independent Director Chung-Lieh Kuo 6 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 39 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 formulated the Rules of Procedure for Board of Directors Meetings to make the
operation of the Board of Directors more institutionalized.
2. The Company’s Audit Committee and the Remuneration Committee are formed by independent
directors, and the “Audit Committee Charter” and the “Remuneration Committee Charter” have been
established to enable the committee members to exercise their supervisory duties and achieve the
goal of strengthening the functions of the Board of Directors.
3. On March 18, 2021, the Company’s Board of Directors approved the appointment of a Corporate
Governance Officer and formulated the “Standard Operating Procedures for Handling Directors’
Requests” to enhance corporate governance operations
4. The Company has established the "Rules Governing the Scope of Powers of Independent Directors".
5. The Company voluntarily provides information on various continuing education courses and
encourages directors to actively participate in various corporate governance courses.
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 2023 and submitted it to the
first Board of Directors meeting in 2024.

38

Exhibit 1: Implementation of the board evaluation.

Evaluation
frequency		 Evaluation period Evaluation scope Evaluation method Evaluation content
Once a year ~~J~~anuary 1, 2023 to
December 31, 2023		 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 Audit Committee
members’ self-
evaluation		 (1) The extent of participation in the
Company's operations.
(2) Perception of Audit Committee’s
responsibilities.
(3) Improvement in the quality of the Audit
Committee's decision-making.
(4) Composition and appointment of Audit
Committee members.
(5) Internal control.
Remuneration
Committee		 Remuneration
Committee members’
self-evaluation		 (1) The extent of participation in the
Company's operations.
(2) Perception of Remuneration Committee’s
responsibilities.
(3) Improvement in the quality of the
Remuneration Committee's decision-
making.
(4) Composition and appointment of
Remuneration Committee members.
(5) Internal control.

(II)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:

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

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

  4. c. Effective implementation of internal control.

  5. d. Compliance with the relevant laws and regulations.

  6. The tasks and responsibilities of the Audit Committee are as follows:

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

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

  9. 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.

39

  • 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 by CPAs.

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

  • The Company's Audit Committee met 5 times in 2023 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

  1. Other matters required to be recorded:

  2. (1) 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. Matters liste d in Article 14-5 of the Securities and Exchange Act:
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 2023
2023.03.17		 Review of the financial statements and business
report for 2022		 V None
2022 earnings distribution proposal None
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
2nd meeting in 2023
2023.05.11		 Review of the financial statements for 1Q 2023 None
3rd meeting in 2023
2023.08.09		 Review of the financial statements for 2Q 2023 None
Plan to serve as the guarantor for bank financing
of subsidiaries		 V None
4th meeting in 2023
2023.11.13		 Replacement of CPAs and evaluation of the
independence and suitability of CPAs		 V None
Review of the financial statements for 3Q 2023 None
Formulation of the audit plan for 2024 None
Plan to serve as the guarantor for bank financing
of subsidiaries		 V None

40

5th meeting in 2023
2023.12.14		 Cash Capital Increase of Xian Linan Computer
Co., Ltd.		 None
Plan to serve as the guarantor for bank financing
of subsidiaries		 V None
1st meeting in 2024
2024.03.12		 Review of the financial statements and business
report for 2023		 V None
2023 earnings distribution proposal None
Finalization of “Procedures for Sustainability
Report Compilation and Assurance”		 None
Amendments to the "Internal Control System"
and"Enforcement Rules for Internal Audit”		 V None
Evaluation of the independence and competency
and appointment of attesting CPAs		 V None
Pre-approval list of non-assurance services V None
2023"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.

  • (2) 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.

  • (3) 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.

41

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

follows:
Meeting date Communication method Communication matters Communication
results
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. Related guidelines 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 of 2022 “Internal
Control System Effectiveness
Review” and “Internal Control
System Statement”.		 All independent
directors present had
no other opinions.
May 11, 2023 Audit Committee Report on the implementation of
audit operations.		 All independent
directors present had
no other opinions.
August 9, 2023 Audit Committee Report on the implementation of
audit operations.		 All independent
directors present had
no other opinions.
November 13, 2023 Pre-board meeting
discussion		 1. The review scope, time, and
key audit matters of the annual
financial statements.		 All independent
directors present had
no other opinions on
the relevant
communication
matters.
November 13, 2023 Audit Committee 1. Report on the implementation
of audit operations.
2. Discussion about the
formulation of 2024 audit plan.		 All independent
directors present had
no other opinions.
March 12, 2024 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 12, 2024 Audit Committee 1. Report on the implementation
of audit operations.
2. Amendments to the “Internal
Control System” and
“Enforcement Rules for
Internal Audit”.
3. Discussion of 2023 “Internal
Control System Effectiveness
Review” and “Internal Control
System Statement”.		 All independent
directors present had
no other opinions.

42

(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 Company’s “Corporate Governance Best Practice Principles” was
approved by the Board of Directors on November 7, 2014 and will be amended
in line with laws and operational requirements. All operations are conducted in
accordance with the “Corporate Governance Best Practice Principles.” Relevant
content is disclosed on 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 takinginto considerationthe diversity ofthe

None

43

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
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 the Annual Report on page15”
(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 page16 of 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 over the age of 71, four are between 61
and 70, and one is between 51 and 60. The Company has two
female directors,and theproportion of female directors is 29%.


























44

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		 The target of increasing the number of female directors to over 25%
has been achieved, and the Company has planned to increase the
number of female directors to over one-third.
(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) Professionalismand continuing educationofdirectors.















45

Evaluation Item Implementation Status Implementation Status Implementation Status Difference from
Corporate Governance
Practice Principles for
TWSE/TPEx Listed
Companies andreasons
Yes No Description
(6) Internal control.
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 2023
was completed in February 2024 and the evaluation results were
submitted to theBoard of Directors on March 12,2024.According to

















46

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 the self-evaluation results of the Board of Directors, board members,
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 12,
2024, 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

47

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 2023:
(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 2023, the Board of Directors had 6 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 13, 2023 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

48

  • (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 2023, which was reported to the Board of Directors in its first meeting in 2024(March 12, 2024).

  • (8) Completed the qualification review of independent directors (including nomination, election, and term of office), and reported to the Board of Directors on March 12, 2024.

  • (9) 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
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

49

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
2023.10.6 Accounting
Research and
Development
Foundation		 Practical Analysis of the
Latest “Sustainable
Development Action Plan”
and the Impact of Net Zero
Carbon Emission on
Financial Statements		 6.0 12.0
2023.11.6 How to Analyze Key
Financial Information to
Strengthen Crisis Early
Warning		 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

50

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

51

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 2023 Corporate Governance Evaluation：
Improved status for the non-scoring items:
Evaluation Index
Improved status
Does the Company simultaneously release material information in English?
Starting in 2024, the Company has simultaneously released material information
in English in accordance with the regulations。
Priorities for improvement:
Evaluation Index
Priorities for improvement
Does the Company compile and upload the sustainability report to the Market Observation
Post System and the Company’s website in accordance with the GRI Standards issued by the
Global Reporting Initiative (GRI)? [If the sustainability report discloses relevant ESG
information with reference to SASB, one point will be added to the total score.]
The Company plans to complete the preparation of the 2023 sustainability report
before August 31, 2024 and upload it to the Market Observation Post System and
the Company’s website, which has been submitted to the Board of Directors for
resolution and approval.

52

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

53

(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

54

Note 2: Continuing education of directors

Job title Name Date Course name Organizer Hours
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
Director Po-Wen
Wang		 2023.04.27 Sustainable Development Action Plan Promotion
Conference for TWSE/TPEx-listed Companies		 Taiwan Stock Exchange 3
Independent
Director		 Che-Fu
Kung		 2023.05.22 Sustainable Development Action Plan Promotion
Conference for TWSE/TPEx-listed Companies		 Taiwan Stock Exchange 3
Independent
Director		 Wang-
Ying Yu		 2023.09.04 The 14th Taipei Corporate Governance Forum Financial Supervisory
Commission		 3
Independent
Director		 Chung-
Lieh Kuo		 2023.10.13 2023 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Independent
Director		 Wang-
Ying Yu		 2023.10.13 2023 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Director Chih-
Chun Liu		 2023.10.13 2023 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Director Po-Wen
Wang		 2023.10.20 2023 Annual Briefing on Insider Trading Prevention Securities and Futures Institute 3
Independent
Director		 Che-Fu
Kung		 2023.11.29 2023 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Independent
Director		 Chung-
Lieh Kuo		 2023.11.29 2023 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3
Director Chih-
Chun Liu		 2023.11.29 2023 Annual Legal Compliance Briefing on Insider
Stock Transactions		 Securities and Futures Institute 3

55

  • (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 15 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 2023, 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
5th 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
6th meeting of the
5th Committee
2023.11.13		 1. Review of the remuneration and
performance evaluation of
directors and managerial officers
for 2023.
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
2023.		 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

56

4. Discussion about the work plan of
the Remuneration Committee for
2024.
7th meeting of the
5th Committee
2024.03.12		 1. Review of the payment of year-end
bonus to managerial officers for
2023.
2. Review of the remuneration and
performance evaluation of
directors and managerial officers
for 2023.
3. Review of the employee profit-
sharing remuneration for directors
and managerial officers for 2023.		 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.

57

  • (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 2023 and the plan for 2024 were reported
to the Board of Directors on December 14, 2023.
3. The Company has formulated the “Procedures for the Preparation and
Assurance of Sustainability Reports” in accordance with the “Regulations
Governing thePreparationandFiling ofSustainabilityReports byTWSE





















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
Listed Companies”, and approved by the Board of Directors on March
12, 2024. It is the basis for the implementation of relevant operating
procedures by the sustainable development promotion team
4. Based on the report on the implementation status, the Board of Directors
reviews the promotion of strategies and plans and urges the promotion
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.






















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
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 management policies as follows:
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 responsible units and their terms of
reference in line with the greenhouse gas
inventory and verification schedule. In 2022
and 2023, the Company will successively
conduct talent training courses such as
“Corporate
Warm-up
Practices
and
Improvement Practices” as well as policy
objectives and control mechanism, and the
initial ISO 14064 application verification
schedule.
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.


60

Promotional Implementation Item Implementation Status Implementation Status Difference from Sustainable
Development Practice
Principles for TWSE/TPEx
Listed Companies and
reasons
Yes No Description
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 establish proper environmental
management systems based on the characteristics of their
industries?

V		 (I) The Company has established an environmental management
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.







None
(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. As the Company provides professional services in the
information service business, and its impact on the environment
and energy consumption are mainly the power consumption of
the office premises.The Company willcontinue to strengthen













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
the implementation of various energy-saving measures, with the
goalof reducing electricity consumptionby1%.
(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
measures include:
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,emergencyhandling,and crisis management that





















None

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
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 waste production?



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 carbon emissions from the offices in 2023 and 2022 were
1,142 tons and 1,107 tons, respectively, an increase of
approximately 3% compared to 2022, mainly due to the increase
in the number of employees in response to operational growth.
In 2024, we will continue to reduce unnecessary electricity
consumption and implement various energy-saving measures,
with a target of 1% carbon reduction in 2024. 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 addition to general water consumption, no additional
wastewater is generated during the Company’s operations. The
water source is from Taiwan Water Corporation, and sewage is
discharged in accordance with regulations. There is no concern
of water pollution. The total water consumption in 2023 and
2022 was 10,817 tons and 10,000 tons, respectively. The
increase in 2023 compared to 2022 was mainly due to the
increase inpersonnel due to operationalgrowth. With the























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
pandemic slowing down in 2024, 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 different recycling sites by professional and
qualified waste disposal companies. The domestic garbage is
collected and transported to the incineration plant.
The total weight of the Company’s general recyclables in 2023
and 2022 was both 8 tons, and the total output of non-recyclable
waste and domestic garbage in 2023 and 2022 was 26.13 tons
and 25.37 tons, respectively. In 2023, the volume of garbage
increased by approximately 3% from 2022, mainly due to the
increase in packaging materials for large-scale project
equipment, resulting in an increase in garbage volume. 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, with the annual target 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 LaborOrganization,and has disclosed the relevant




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
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
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
mechanismandfollows strict control regulations and protective





















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
measures.
In 2023, the Company has implemented ethical corporate
management policy promotion, “Partner Business Code of Ethics
and
Anti-Corruption
Training”,“Personal
Information
Management System (PIMS)”, “Information Security”, “Human
Rights Protection”, and internal control related courses and plans
amounted to4,515 person-times,fora totalof6,066 person-hours.



(II) Does the Company establish and deliver reasonable
employee
welfare
programs
(including
salary,
compensated absences, and other benefits) and adjust
employee
compensation
in
relation
to
business
performance?



V		 (II) 1. Implement reasonable employee welfare measures:
(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.
2. The Company enforces diversity and equality in the workplace and
provides equal promotion opportunities for male and female
employees. In 2023, the percentage of female employees was
31.12% and the percentage of female managerial officers was
21.09%.
3. Reflect business performance or results in employee compensation
as appropriate:
(1)The Company has established reasonable salary and remuneration
measures,a completeperformance management system,and a

















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
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 compensate it first and then allocate an amount for employee
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 reportingfor work.














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
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 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. The building is disinfected every six months and the floor cleaning
and waxing operations are carried out every month; in line with the
post-pandemic prevention measures, the Company continues to
strengthen the promotion of the concept of public health and
cleaning and disinfection. Every day, colleagues and visitors to the
Company are still recommended to wear masks and continue to have
their body temperature measured and hands are disinfected. Alcohol
and antibacterial hand sanitizer is placed at the entrance of each
floor. Antibacterial hand sanitizer is also placed in the pantry.
Alcohol/antibacterial hand sanitizer is also placed in each meeting
room for colleagues and 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"OccupationalSafetyBulletin"and"Registered Nurse
























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
Bulletin".
11. General safety and health on-the-job training courses are held each
year. In 2023, a total of 1,266 person-times and a total of 3,798 man-
hours were held.
12.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.
13.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.
14.We provide employees with term life insurance and accident
insurance to increase their job protection.
15.We provide a family-friendly workplace environment for employees
by setting up a breastfeeding room.
16.The Company has completed fire safety facilities, and conducts
routine employee fire escape drills and related education and
training courses every year to reduce the probability of fire, and
there wasnofireincidentin 2023.









(IV) Does the Company provide its employees with career
development and training sessions?
V		 (IV) In order to cultivate talented employees, the Company has established
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 7,263 and the cost of education and training was NT$6.75
million in 2023.




None
(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-
mailaddress tohandleissuesrelated to customercomplaints.



None
(VI) Does the Companyformulate supplier management policies V (VI)The Companyhas established supplier management policies, whichare None

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
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?

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 evaluation project has included the
sustainable development evaluation aspect, to promote the
cooperative suppliers to comply with the relevant corporate social
responsibility regulations, exert the corporate social influence, and
promote the economic, social and environmental ecological balance
and sustainable development.
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
internationalbrands.Inadditionto ensuring that the Company's
























70

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
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
reportsfroma third party accreditation institution?



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 planned to
refer to the international
reporting standards or
guidelines to prepare the
2023 sustainability report.
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:
Responsibleforenvironmentalprotection, greenenvironment, energy saving and carbon reduction, ecologicalsustainability, greenhouse gasinventory, and safety andhealth

71

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 2023 and the plan for 2024 were reported to the Board of Directors on December 14, 2023.

The main implementation results for 2023 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. To cultivate outstanding talents and increase industry-academia cooperation opportunities between enterprises and academia, the Company actively participates in sponsoring scholarships and various activities for academic groups. The Company donated NTD 40,000 for each scholarship in 2023 to the “Cheng Electrical Engineering Cultural and Educational Foundation” and “National Dong Hwa University”, and donated NTD 50,000 scholarship to the “Private Tamkang University”. In 2023, 17 interns were recruited, including 4 interns from National Chung Hsing University, 1 from Taipei University of Business, 1 from Fu Jen Catholic University, and 9 from Yuan Ze University and 2 from Ming Chuan University students were provided professional internship opportunities.

  3. 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 2023 was as follows: (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".

  4. (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, 9 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 2023, the Company had 7,263 attendance in internal training and external training, and the cost of education and training was approximately NT$6.75 million. The main plans for 2024 are as follows:

  1. In terms of corporate governance, we plan to continue the performance evaluation of the Board of Directors and continue to improve the transparency of website information, and more.

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

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

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

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

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

72

Implementation of Climate-Related Information

Implementation of Climate-Related Information
Implementation status
1. Describe the board of directors' and management's oversight
and governance of climate-related risks and opportunities.		 The Company's board of directors has approved the establishment of a sustainable development promotion team to be responsible for the
formulation and implementation of sustainable development-related policies and systems, and to review and improve the implementation
results. At least once a year, the team will report the implementation plan and results to the board of directors, including the risks assessment
of climate change, mitigation measures and so on topics. The Board of Directors reviews the strategy and promotion of the plan based on the
implementation status, and urges the promotion team to make adjustments where necessary.
2. Describe how the identified climate risks and opportunities
affect the business, strategy, and finances of the business
(short, medium, and long term).		 The major climate risks faced by the Company mainly come from the requirements of key stakeholders such as regulators, customers and
investors for the reduction of corporate greenhouse gases. The opportunities brought about by climate change are mainly in the aspect of
products and services. The Company's short-term strategy is to continuously strengthen internal emergency response capabilities and reduce
possible property losses through insurance. The medium-term strategy is to continuously improve supplier management. The long-term
strategyis to address the supply chain issues caused by climate changeinproductionand sales strategies.
3. Describe the financial impact of extreme weather events and
transformative actions.		 The Company has not yet completed the assessment of the financial impact of extreme climate events and transition actions.
4. Describe how climate risk identification, assessment, and
management processes are integrated into the overall risk
management system.		 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”.
Continue to improve energy conservation through planned electricity consumption, and include greenhouse gas inventory as a material topic
forcorporate sustainable development.
5. If scenario analysis is used to assess resilience to climate
change risks, the scenarios, parameters, assumptions, analysis
factors andmajor financial impacts used should be described.		 The Company has not used scenario analysis to evaluate the resilience in the face of climate change risks.
6. If there is a transition plan for managing climate-related
risks, describe the content of the plan, and the indicators and
targets used to identify and manage physical risks and
transition risks.		 The Company has not yet completed the transition plan in response to the management of climate-related risks.
7. If internal carbon pricing is used as a planning tool, the basis
for setting the price should be stated.		 The Company has not yet used internal carbon pricing as a planning tool.
8. If climate-related targets have been set, the activities
covered, the scope of greenhouse gas emissions, the planning
horizon, and the progress achieved each year should be
specified. If carbon credits or renewable energy certificates
(RECs) are used to achieve relevant targets, the source and
quantity of carbon credits or RECs to be offset should be
specified.		 The Company has not yet set climate-related goals.
9. Greenhouse gas inventory and assurance status and
reduction targets, strategy, and concrete action plan.		 The Company has drawn up a schedule for the initial application of ISO 14064 certification, and expects to pass the certification of a third-
party organization in 2025.

73

  • (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

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 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

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
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
2023.
3.The Company has established procedures for handling
complaints
and
confidentiality
in
the
“SYSCOM
COMPUTER Whistleblower Reporting Regulations”, and
no complaints were filed in 2023.
4.In 2023, 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
4,515 attendees, totaling 6,066 person-hours.



























76

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 2023 to the Board of Directors on
December 14, 2023.
(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 dedicated
handling unit.






None

77

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 and Market 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 System and Annual 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.

78

  • (IX) Implementation status of internal control system:

  • Internal Control System Statement

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

Date: March 12, 2024

With regard to the 2023 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, 2023 (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 12, 2024, 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

79

  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:

Date Important resolutions Implementation status
2023.06.13
Regular
shareholders’
meeting
1. Adoption of 2022 Business Report and Financial
Statements.
2. Adoption of 2022 earnings distribution proposal.
3. Approval of the amendments to the “Articles of
Incorporation”.		 1. Implemented in accordance with the resolutions of
the shareholders' meeting.
2.July 19, 2023 was set as the base date for
distribution and August 8, 2023 as the payment
date, and cash dividends of NT$2.2 per share were
distributed in accordance with the resolution of the
shareholders' meeting.
3.The amendments were registered on July 10, 2023
upon approval by the Ministry of Economic
Affairs and announced on the Company's website.

2. Board of Directors

Date Important resolutions
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.
2nd meeting in 2023
2023.05.11		 1. Report on greenhouse gas inventory and verification schedule planning.
2. Approval of the review of the financial statements for 1Q 2023.
3. Approval of bank financing lines.
3rd meeting in 2023
2023.06.13		 Determining the ex-dividend date, stock closing date and cash dividend payment date related
matters.
4th meeting in 2023
2023.08.09		 1. Report on greenhouse gas inventory and verification schedule planning.
2. Approval of the review of the financial statements for 2Q 2023.
3. Approval of bank financing lines.
4. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.

80

5th meeting in 2023
2023.11.13		 1. Report on greenhouse gas inventory and verification schedule planning.
2. Replacement of CPAs and evaluation of the independence and suitability of CPAs.
3. Approval of the review of the financial statements for 3Q 2023.
4. Approval of the audit plan for 2024.
5. Approval of review matters of the 6th meeting of the 5th Remuneration Committee.
6. Approval of bank financing lines.
7. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.
6th meeting in 2023
2023.12.14		 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. Approved the cash capital increase of Xian Linan Computer Co., Ltd.
7. Approval of bank financing lines.
8. Approval of the plan to serve as the guarantor for bank financing of subsidiaries.
1st meeting in 2024
2024.03.12		 1. 2023 Business Report.
2. Report on the results of performance evaluation of the Board of Directors for 2023.
3. Report on greenhouse gas inventory and verification schedule planning.
4. Review on the qualifications of independent directors by the corporate governance officer.
5. Approval of 2024 business plan and budget.
6. Approval of review matters of the 7th meeting of the 5th Remuneration Committee.
7. Approval of the 2023 profit-sharing remuneration proposal for employees and directors.
8. Approval of the renewal of directors' and managerial officers' liability insurance.
9. Approval of the financial statements and business report for 2023.
10. Approval of 2023 earnings distribution proposal.
11. Approval of the amendments to the “Articles of Incorporation”.
12.Approved of the amendments to the “Rules of Procedure for the Board of Directors’ Meetings”.
13.Approved the amendments to the“Audit Committee Charter”.
14.Approved the“Procedures for the Preparation of Sustainability Report and Assurance”.
15.Approved the revision of the “Internal Control System” and the “Implementation Rules of
Internal Audit”.
16.Approved the re-election of directors.
17.Approved the nomination of candidates for directors (including independent directors).
18.Approved the lifting of non-compete restrictions on the newly elected directors.
19. Approval of the subjects of the 2024 regular shareholders’ meeting.
20. Approval of the acceptance of the proposals of shareholders holding more than one percent of
shares.
21.Approved matters related to the acceptance of nominees for directors (including independent
directors) nominated by 1% shareholders.
22. Approval of the evaluation of the independence and competency and appointment of attesting
CPAs.
23. Passed the list of pre-approved non-assurance services.
24. Approval of the "Assessment of the Effectiveness of Internal Control System" and "Internal
Control System Statement " for 2023.
25. Approval of bank financing lines.
26. 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 Li-Wen Kuo 2023.01.01-2023.12.31 2,512 558 3,070
Pei-De Chen

Note: Non-audit fees include $458 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.

81

  • (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:

Deloitte Taiwan has appointed Hsin-Wei Tai and Pei-De Chen, CPAs of Deloitte & Touche, as the independent auditors of the Company. Due to a change of duties within the firm, the signing of financial statements has been re-designated from the third quarter of 2023 onwards by Li-Wen Kuo and Pei-De Chen of Deloitte & Touche.

  • 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 2023 2023 The current year up to April 14 The current year up to April 14
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
Majorshareholder		 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 0 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
(Note 1)		 Chin-Hsiang Hsu (18,000) 0 0 0
Vice President Chao-Lai Wu 0 0 0 0
Vice President Anthony Tseng (977) 0 0 0
Vice President Chen-Huan Li (13,000) 0 0 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 Kuang-Keng Liang 0 0 0 0
Sales Vice President Shu-Ching Lin 0 0 0 0

82

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 (13,917) 0 0 0
Chief R&D Officer Tsai-Cheng Chen (56) 0 0 0
Principal Division
Chief		 Tsai-Chi Sung 0 0 0 0
Principal Division
Chief		 Chih-Wei Wen (25,286) 0 0 0
Chief Finance Officer Li-Chueh Du (7,000) 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 0 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 (20,000) 0 0 0
Division Chief Shu-Hua Liu (3,000) 0 0 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 (369) 0 0 0
Senior Assistant VP
(Note 3)		 Hsiao-Shu Ma 0 0 0 0
Principal Division Chief Te-Li Chen (2,000) 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 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 0 0
Division Chief Wen-Po Hsu 0 0 0 0

83

Senior Division Chief Erh-Wei Dai (500) 0 0 0
Principal Division Chief Hui-Yi Lin (8,000) 0 0 0
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
Senior 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(Note 5)		 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 (3,000) 0 0 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 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
ProjectAssistant 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

84

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 1,000 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
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 Fu-Yuan Wen 0 0 0 0
Division Chief Yi-Feng Lai 0 0 0 0
Project Assistant VP Yi-Ling Hsu 0 0 0 0
ActingAssistant VP Hung-Jen Hsiao 0 0 0 0
Project Assistant VP Yi-Cheng Wu 0 0 0 0
Project Assistant VP Sheng-Yu Chen 0 0 0 0
Division Chief Ling-Hao Chen 0 0 0 0
Project Division Chief Chun-Wen Yu 0 0 0 0
Division Chief Cheng-Heng Deng 0 0 0 0
Acting Assistant VP
(Note 6)		 Ying-Ying Hsu 0 0 0 0
Division Chief Chi-Cheng Chih 0 0 0 0
Principal Division Chief Te-Kuei Chiu 0 0 0 0
Division Chief (Note 7) Hung-Jui Hsieh 0
0		 0
0
Division Chief (Note 8) Zhong-Yan Wu 0
0		 0
0
Division Chief (Note 7) Hao-Fan Liu 0
0		 0
0
Division Chief (Note 9) Chiung-Ying Tai 0
0		 0
0
Acting Division Chief
(Note10)		 Yao-Jen Yeh 0
0		 0
0
ActingAssistant VP
(Note11)		 Yu-Chiang Huang 0
0		 0
0
Project Division Chief
(Note12)		 Ho-Wen Chen 0
0		 0
0
Project Assistant VP
(Note 13)		 Hsiu-Hsien Wu 0
0		 0
0

85

(1,268,000) 0 0

Su-Chen Yang

0

Major shareholder

(Note 14)

Note 1: Left office on December 31, 2023. Note 2: Left office on February 29, 2024. Note 3: Left office on February 28, 2023. Took office on September 1, 2023. Note 4: Left office on March 20, 2023. Note 5: Left office on March 31, 2023. Note 6: Left office on August 14, 2023. Note 7: Took office on March 17, 2023. Note 8: Took office on March 17, 2023. Left office on March 1, 2024. Note 9: Took office on March 22, 2023. Note 10: Took office on March 27, 2023. Note 11: Took office on June 1, 2023. Note 12: Took office on July 17, 2023. Note 13: Took office on November 1, 2023. Note 14: Left office on May 27, 2023.

  • (II) Information on the related party who is the counterparty of equity transfer: None.

  • (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 14,2024 April 14,2024 April 14,2024 April 14,2024 April 14,2024 April 14,2024 April 14,2024
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% 0 0 0 0


 Chih-Chun Liu
Chi-Shan Liu
Chuan Gao		 Father and daughter
Father and daughter
Natural person as its major shareholder		 None
Chi-Shan Liu 7,598,911 7.60% 0 0 0 0



 Jui-Fu Liu
Su-Chen Yang
Chih-Chun Liu
Chuan Gao		 Father and daughter
Mother and daughter
Sisters
Father as major shareholder		 None
Su-Chen Yang 7,256,001 7.26% 0 0 0 0
Chih-Chun Liu
Chi-Shan Liu		 Mother and daughter
Mother and daughter		 None
Chih-Chun Liu 4,375,567 4.38% 0 0 0 0



 Jui-Fu Liu
Su-Chen Yang
Chi-Shan Liu
Chuan Gao		 Father and daughter
Mother and daughter
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
Chih-Chun Liu
Chi-Shan Liu		 The major shareholder
Child of a major shareholder
Child of a major shareholder		 None
HSBC Bank
(Taiwan) is
entrusted with the
custody of
Arcadian
Emerging Markets
Equity Small Cap
Fund Co., Ltd.
Investment
Account		 1,187,000 1.19% 0 0 0 0 None None None
Citibank Taiwan
Ltd is entrusted
with the custody
of Berkeley
Capital Securities
Investment
Account		 691,000 0.69% 0 0 0 0 None None None
Chih-Yung Li 583,000 0.58% 0 0 0 0 None None None
JPMorgan Chase
Bank N.A. Taipei
Branch is		 546,000 0.55% 0 0 0 0 None None None

86

entrusted with the
custody for
BUMA Global
Fund I Investment
Account
HSBC Bank
(Taiwan) is
entrusted with the
custody for
Arcadian
Emerging Market
Micro Capital
Securities Master
Fund		 537,000 0.54% 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, 2023

Unit: Shares; %

December 31, 2023
Unit: Shares;%		 December 31, 2023
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. 2,679,450
99.24%
0
0
2,679,450
99.24%
Syscom Computer (Thailand) Co., Ltd. 3,440,000
92.47%
20,000
0.54%
3,460,000
93.01%
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.

87

Four. Fund raising

I.Capital and stock

(I) Sources of capital:

April 14, 2024

April 14, 2024 April 14, 2024
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 14, 2024
Shareholder
Composition
Number

Government
agency		 Financial
institution		 Other
corporation		 Individual Foreign
institution and
foreigner		 Total
Number of people 0 0 68
18,272
60
18,400
Number of shares
held		 0 0 3,253,417
89,746,028
7,000,555
100,000,000
Shareholding
percentage		 0% 0% 3.25%
89.75%
7.00%
100.00%

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

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(III) Distribution of Shareholding

II) Distribution of Shareholding
April 14, 2024
Shareholding range Number of
shareholders		 Number of shares
held		 Shareholding
percentage
1 to 999 5,478
482,711
0.48%
1,000 to 5,000 11,083
20,596,565
20.60%
5,001 to 10,000 1,045
8,446,696
8.45%
10,001 to 15,000 285
3,724,880
3.73%
15,001 to 20,000 173
3,220,251
3.22%
20,001 to 30,000 142
3,707,497
3.71%
30,001 to 40,000 50
1,830,984
1.83%
40,001 to 50,000 36
1,711,049
1.71%
50,001 to 100,000 61
4,264,081
4.26%
100,001 to 200,000 22
3,202,961
3.20%
200,001 to 400,000 11
3,162,000
3.16%
400,001 to 600,000 7
3,477,562
3.48%
600,001 to 800,000 1
691,000
0.69%
800,001 to 1,000,000 0
0
0.00%
More than 1,000,001 6
41,481,763
41.48%
Total 18,400
100,000,000
100.00%
  • (IV) List of major shareholders (Name of the top ten shareholders in terms of shareholding percentage)
April 14, 2024 April 14, 2024 April 14, 2024
Shareholding
Name of major shareholder
Number of
shares held		 Shareholding
percentage
Jui-Fu Liu 18,346,787
18.35%
Chi-Shan Liu 7,598,911
7.60%
Su-Chen Yang 7,256,001
7.26%
Chih-Chun Liu 4,375,567
4.38%
Chuan Gao Investment Co., Ltd. 2,717,497
2.72%
HSBC Bank (Taiwan) is entrusted with the custody of
Arcadian Emerging Markets Equity Small Cap Fund Co., Ltd.
Investment Account		 1,187,000
1.19%
Citibank Taiwan Ltd is entrusted with the custody of Berkeley
Capital Securities Investment Account		 691,000
0.69%
Chih-Yung Li 583,000
0.58%
JPMorgan Chase Bank N.A. Taipei Branch is entrusted with
the custody for BUMA Global Fund I Investment Account		 546,000
0.55%
HSBC Bank (Taiwan) is entrusted with the custody for
Arcadian Emerging Market Micro Capital Securities Master
Fund		 537,000
0.54%

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

Item Year Year 2022 2023
Market price per
share (Note 1)		 Highest 32.10 84.00
Lowest 22.85 25.45
Average 27.37 62.78
Net worth per
share(Note 2)		 Before distribution 20.50 21.14
After distribution 18.30 18.74
Earnings per
share		 Weighed average number of shares 100,000,000
100,000,000
Earnings per
share(Note 3)		 Before adjustment 2.51
2.78
After adjustment 2.51
2.78
Dividends per
share		 Cash dividends 2.20
2.40
Stock
dividends		 Stock dividends from
earnings		 -
-
Stock dividends from
capital surplus		 -
-
Accumulated unpaid dividends (Note 4) - -
Investment return
analysis
Price to earnings ratio (Note 5)		 10.40
20.30
Price to dividends ratio (Note 6) 11.86
23.52
Cashdividends yield (Note 7) 8.43% 4.25%

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

  • (VI) Dividend policy and implementation status

  • 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 2023 net profit after-tax was NTD 278,293,248, of which NTD 27,613,120 was set aside as a legal reserve, and the earnings available for distribution this year was NTD 724,967,745. For the 2023 earnings appropriation, the Board of Directors resolved to appropriate cash dividends of NTD 240,000,000 (NTD 2.4 per share).

  • (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.

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(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 2023 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$10,300,000 in cash and for directors of NT$0. The proposed distribution amount is not different from the estimated amount of expenses recognized in 2023.

  - (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 2022, the Company distributed profit-sharing remuneration for employees of NT$9,600,000 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 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

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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 2023 Main products and sales percentage in 2023
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, establishment, and maintenance of treasury cross-banking business and financial service channel integration platform

  • (7) eDDA (Digital Authorization Service) and eACH (ACH Add and Debit System) solutions planning, establishment, and maintenance services for Taiwan Clearing House

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

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

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

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

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

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

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

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

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

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

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

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

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

  • (21) Smart mobile ticketing system

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

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

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  • (24) 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)

  • (25) Business application systems and basic service systems for public offices (public affairs manpower management system interface, directory services, document file management, electronic mail, mail security gateway...) Planning, construction and maintenance services

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

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

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

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

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

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

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

  • (33) Computer facility management outsourcing services

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

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

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

  • (37) System performance tuning and testing services

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

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

  • (40) Service-based Robot,Ayuda

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

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

  • (43) (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) Intelligent service robot - AYUDA

  • (3) DBMaker Docker Image

  • (4) Shopping mall robots

  • (5) Anti-pandemic service robots

  • (6) OMFLOW Continuous Configuration Automation module

  • (7) Opus One IP Continuous Configuration Management Platform (Version 1.5.5 and 1.5.6)

(II) Industry overview

  1. Current status and development of the industry

The government has established the Ministry of Digital Affairs to spearhead the development of the digital industry. Recently, it plans to promote the “Big Software Project”, which will make good use of Taiwan’s hardware advantages to drive the software industry, create a good foundation for digital development, and promote the upgrade of the digital economy industry to help the domestic digital industry to meet the big software era, and become Taiwan’s new trillion industry. Benefited from the generative AI trend, the increasing demand for information security and compliance, enterprises are investing more resources in areas such as data sovereignty, digital resilience, and supply chain reshaping. Taiwan’s information service market will show healthy and steady growth in 2023.

Information and communication technology is widely used in smart life, urban and rural areas, medical care, transportation, manufacturing and other fields, and AI is accelerating the

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development of the industry. Looking forward to 2024, as the demand for cloud migration of enterprises continues, the management of hybrid environment has become the focus of growth in the information service market. As a major information service provider in Taiwan, the Company actively expands its business through hybrid cloud management, industrial cloud, cloud security and other solutions. The continuous expansion of AI terminal applications and the upgrade of hardware specifications are expected to usher in a new wave of machine replacement; in the future, the combination of 6G, satellite communication, IoT, artificial intelligence and other technologies, as well as the continuous evolution of cloud data centers, will provide more stimulation and challenges for the market.

  1. Correlations among the upstream, midstream and downstream industries

Information technology service refers to the provision of professional infrastructure services, development and deployment services, business process services, consulting services, software support services, and hardware maintenance and operation total solution services to customers according to their specific operational needs. Revenues are primarily derived from the value of services rendered. 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.

Syscom has been committed to large-scale system integration and information application services since its establishment, and continues to introduce various cutting-edge products and advanced technologies, utilizing the rich domain know-how accumulated in different fields, we provide customers with the best quality professional information services and assist enterprises in promoting digital transformation and development. Upstream players include domestic and foreign software and hardware manufacturers or agents such as Cisco, Dell/EMC, Fortinet, HPE, VMWare, and more, as well as Google Cloud Services and Microsoft Cloud Services. Downstream covers end-user organizations such as financial institutions, telecom operators, government agencies, medical institutions, transportation, educational institutions, manufacturing industries, and retail distribution.

  1. Development trends and competition of products

  2. (1) Information security

    • The year 2023 can be said to be the year of the great leap forward in technology. Enterprises have begun to turn to technologies such as artificial intelligence, machine learning, cloud, and Web3 and more. These breakthrough technologies that bring about transformation momentum are the motors for enterprises to improve their competitiveness, and at the same time, they have also become powerful tools for hacker attacks. Since the implementation of the “Cyber Security Management Act” and the “Financial Security Action Plan Version 2.0”, the rigid demands for corporate compliance have continued to grow; and with the increasing digitalization of the supply chain, more and more supply chain-specific cyber threats have arisen, and Taiwan’s financial institutions and semiconductor industry have put in place corresponding supply chain risk management regulations.

(2) Cloud application services Faced with the impact of the pandemic in previous years, enterprises have accelerated their transformation and investment and actively adopted the cloud, in order to find more effective cloud maintenance operation management practices; according to the MIC survey report, in 2023, Taiwanese enterprises tend to have a positive attitude towards public cloud services, with a considerable increase in the number of enterprises adopting them and the amount of money invested. As the demand for enterprises to adopt the cloud continues, the management of hybrid environment has become the focus of growth in the information service market. Taiwan’s major information service providers are actively expanding their businesses through solutions such as hybrid cloud management, industrial cloud, and cloud-based security.

(3) Artificial Intelligence (AI) Generative AI has been applied to all walks of life and is gradually having a pivotal impact on people’s livelihood and society. There are many applications worthy of investment and introduction in content creation, business services, R&D and manufacturing, as well as operations and supply chain; using generative AI has become a trend, but the follow-up issues such as information security, privacy, and information accuracy cannot be ignored,

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which in turn gives rise to the demand for trusted AI.

  • (4) Smart healthcare

The National Science and Technology Council promotes the precision health strategic industry to promote the development of precision medicine, regenerative medicine, digital medicine and other industries, and to promote the formation of the industry chain. In the future, it is an inevitable trend to develop innovative biomedical technology that is cross-disciplinary. We will continue to make use of Taiwan’s strengths in manufacturing and information and communication to continue to promote the application of biomedical big data, establish a smart medical and service infrastructure, and promote industrial integration and innovation through policy guidance to solidify Taiwan’s energy of biomedicine, connect with the world, give back to society, and truly realize the vision of precision health for all ages by 2030.

  • (5) Service robots for commercial use

Taiwan has a solid foundation in the fields of information communication and automation equipment, and has the potential to develop the service robot industry. In recent years, as AI technology has matured, various businesses have further begun to incorporate AI technology into their products, hoping to provide users with better services through functions such as image recognition and speech analysis. In the future, robots will have multiple perception capabilities. Through powerful software, edge computing, and advanced sensors, robots can naturally interact with the world and solve problems and make effective decisions. They are mainly used in retail, medical care, and elderly care.

  • (6) New smart services derivative from smart cities

The Executive Yuan actively promotes “Smart Taiwan” so that citizens can enjoy the benefits of smart technology. Smart city refers to the use of data, communication and technology to improve urban problems. The scope of application includes six major areas: Smart environment, smart transportation, smart life, smart citizens, smart government, and smart economy. Through smart networking, cloud computing, big data, mobile internet, smart terminals and other information technologies, it is applied to the power system, water supply system, transportation system, buildings and oil and gas pipelines, factories, offices, homes and other production and manufacturing or living system in order to enhance people’s work efficiency and quality of life.

  • (7) Green/sustainable IT

ESG and green sustainability have become the key business challenges that enterprises must face after the COVID-19 pandemic. To a large extent, the growth momentum of sustainable development services comes from the continuous pressure from regulators on enterprises. The coercive pressure also forces companies to accelerate the development of key processes and sustainability management tools. AI analysis and other smart technologies can help companies optimize their ESG strategies and ensure compliance with the latest trends and standards. However, the promotion of generative AI and the rapid expansion of the IoT are posing increasing pressure on global data centers, and posing greater challenges to power consumption and carbon emissions.

  • (8) Outsourcing services

Establishing a sound and stable IT maintenance and operation plan is an important part of an enterprise’s sustainable operation plan. The recent wave of digital transformation, especially in the fields of artificial intelligence and information security protection, has increased the complexity of managing IT infrastructure within an organization, and the cost of configuration, operation, and management of IT infrastructure has continued to rise, prompting enterprises to adopt managed IT services mode. The IT outsourcing service will continue to evolve, showing a trend of diversification and specialization, to meet the needs of enterprises in new technologies such as cloud computing, big data, and artificial intelligence.

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  • (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

he Annual Report
Unit: Thousands of NTD
Year Amount As a percentage of
operating revenue
2022 230,033
3.87%
2023 242,585
3.80%

  • 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

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editing/data compilation/reporting, and a full range of custom development services to 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) 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.

  • (8) 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.

(9) 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 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.

  • (10) 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

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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.

(11) NETCenter

NET Center is an IT monitoring and management software developed by Syscom, which helps IT administrators to fully control the status of the IT architecture and information management solutions. It helps enterprises to flexibly face various information challenges and effectively manage the increasing number of network devices. In the latest version, the ten major functional modules are re-defined so that users can jump out of the original IT (information) vision and expand to the Security (information security) level, and Business (operation) and other three-way integration management. An “All-round enterprise war room” needs to be built and the following new functions should be developed:

  • a. DNS monitor function

  • b. Content verification rules

  • c. VM alarm function

  • d. Firmware history

  • e. F5/QOS file list

  • f. SFP optical transmission power monitoring module

(12) 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.

  • (13) 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

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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.

  • (14) 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.

  • (15) 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.

  • (16) 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

  • (17) 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.

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(18) 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.

(19) Patrol box electronic

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.

  • (20) 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.

(21) Intelligent service robot-AYUDA

The Syscom intelligent service robot Ayuda has been researched and developed for many years. Since the emergence of generative AI technology at the end of 2022, the Ayuda service robot has been equipped with the R&D capabilities, and the added value of using generative AI will drastically change the service robots to become smarter and more humanized. The series of products developed by the Syscom intelligent service robot (as shown below): a. Ayuda

  • ⚫ Mobile, head and hand movable

  • ⚫ Human detection, face recognition

  • ⚫ Voice recognition and answering questions

  • ⚫ Video connection and remote monitoring

  • ⚫ Self-built maps and guided cruise

  • b. Ayuda Cute

  • ⚫ Provides face recognition and card swiping for body temperature measurement

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  • ⚫ Provide back-end management of face recognition data and employee measurement data

  • ⚫ Abnormality can be reported through Line

  • ⚫ Provide customized API concatenation function

  • c. Ayuda Nano

  • ⚫ Used for access control, providing face recognition, card swiping, body temperature measurement

  • ⚫ Streamlined form factor to reduce costs

  • ⚫ Provide face recognition, card swiping in series with the access control system to open the door

  • ⚫ The function of measuring body temperature (Option)

  • d. Ayuda Nano Super

  • ⚫ Provide face recognition, mask detection, and body temperature measurement functions

  • ⚫ Travel history inquiry function

  • ⚫ Provide check-in records with health insurance card, ID card

  • ⚫ Provide card readers, Barcode Reader, printers and other input/output devices

Adopting the widely accepted international standard ROS (Robot Operation System) in the robotics field, integrating the professional systems that have been established by Syscom, such as police administration, medical care, banking, and more, to innovate value-added applications and build a professional service robot in the field. The emergence of generative AI has made service robots even more powerful. The generative AI solution of Syscom, NeoChain, acts as a middle layer between human beings and generative AI. This middle layer is pre-processed and embedded with the enterprise’s own knowledge database, including documents, web pages, forms, and more. When a user asks a question, the generative AI first determines the user’s intention, and the middle layer finds the correct answer first, and then summarizes the response through the generative AI, repeatedly asking the generative AI through Prompt to obtain the final and accurate answer.

(22) AI Imaging Expert Platform VIAMaster

The technical core value of the “AI Imaging Expert Platform VIAMaster” lies in the development of artificial intelligence applied to image recognition and solutions for rapid training, rapid deployment, and real-time application. 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, surveillance industries, and financial industries to implement the technology of this solution in smart security applications such as public safety, and combined with the wearable camera images returned by real-time analysis and identification can help reduce manpower, the intelligentization of security work, and continue to add applications to new areas, such as job site security monitoring, road traffic monitoring, and pedestrian flow safety monitoring at shopping mall transfer stations.

(23) 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.

(24) 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.

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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

  • (25) 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.

(26) 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.

  • (27) 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.

  • (28) 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

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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.

  • (29) Big data database multi-level dynamic column R&D project

  • a. Support for Multiple Level Dynamic Column (MLDC) and Json Path due to the advent of new technology trends such as Big Data and IoT, there is an increased demand for storing and analyzing large amounts of different types of data with high variability, and it is important to look for price trends, data models, and predictions of consumer behavior from huge amounts of data as a reference for decision-making. This project especially provides flexible multi-level dynamic fields and JSON PATH, which can be added at any time and in real time to multi-level data fields, such as sub-item data, so that the data access can have richer layers, become more flexible and convenient.

  • The multi-level dynamic column of this project uses an easy-to-configure and extensible Lua module to serialize the data treemap, data encapsulation, and data encoding on multilevel data, and can quickly sort the data structure to improve data readability, and it can achieve the data complexity of O(h) (h is the height of the structure tree), and has data security.

  • b. Aggregate Function

  • In terms of data analysis, the statistical summary function is provided to obtain the maternal standard deviation (STDDEV_Pop), sample standard deviation (STDDEV_SAMP), maternal variation (VAR_Pop), and sample variation (VAR_SAMP) from big data to assist in the subsequent establishment of statistical models and trend forecast.

  • In addition to providing statistical summary functions, it also allows users to write complex aggregation functions easily for application in more statistical analysis and OLAP operations, making it a powerful tool for big data analysis.

  • ⚫ STDDEV_POP: Maternal standard deviation

  • ⚫ STDDEV_SAMP: Sample standard deviation

  • ⚫ VAR_Pop: Maternal Variation

  • ⚫ VAR_SAMP: Sample variation

  • (30) Java Database Connectivity Native Protocol Driver Interface R&D Project

The JDBCType4 database with direct-to database-driver, also known as the pure Java driver interface, provides the following functions:

  • a. Database connection: The Type 4 driver interface allows the Java application to establish the connection with the relational database. This is its most basic function, which enables the application to access and operate the data in the database.

  • b. Cross-platform: Since Type 4 driver interface is pure Java, it can be run on various operating systems to achieve cross-platform. This enables developers to write highly portable code without worrying about compatibility issues on different platforms.

  • c. High performance: The Type 4 driver interface directly transmits the request of the Java application to the database without the need for a middle layer or a local client. This reduces the communication and processing overhead and improves the performance of database operations.

  • d. Simplified configuration: Type 4 driver interface does not require client installation, thus, they reduce the configuration requirements of application programs. This simplifies the deployment process and reduces potential issues.

  • e. Security: The Type 4 driver interface can implement security, including identity verification and authorization mechanism, to ensure that only authorized users can access the database. It also supports network transmission encryption to improve database security.

  • f. Ease of development: Type 4 driver interfaces usually provide intuitive and simple API, which enable developers to establish database connections, execute SQL queries, and process data more easily. This helps to improve development efficiency.

  • (31) Hyper Automation Scanning Task Framework

Provide a reusable, hyper automation scanning task framework that can effectively reduce the use of scanning OP manpower and shorten the scanning process. 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

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method, automatic downloading, automatic decompression, automatic scanning and sending of scanning reports, etc. All the above operations are included in this framework.

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

Syscom has been established for nearly 50 years. It has been adhering to professional information services, assisting enterprises and government organizations to promote digital transformation 2.0 with AI, and continues to target trend applications such as information security needs, cloudification, and massive data analysis, to seize the opportunities and break new ground.

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

  1. Short-term business development plan

  2. (1) Integrate system management tools to improve the efficiency and quality of corporate operations.

  3. (2) Expand core products and professional technical services to improve overall profitability.

  4. (3) Develop a knowledge-based economy that includes generative AI, cloud services, 5G, and information security.

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

    • platforms.

  6. (5) Alliance with outstanding domestic manufacturers to explore business opportunities in various industries at home and abroad.

  7. Long-term business development plan

  8. (1) Cultivate high-quality IT talents and implement continuous improvement of total quality. (2) Enhance corporate growth and innovation, and commit to the sustainable development of ESG.

  9. (3) Demonstrate powerful system capabilities and help enterprises upgrade digital transformation with the results of generative AI.

  10. (4) Bridging the application of cutting-edge technology industries and forming an alliance with Taiwan team for World Cup.

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
2022		 2023

Domestic sales		 Export sales Domestic sales Export sales
Volume Value Volume Value Volume Value Volume Value
System Integration Service &
Computer/Peripheral Sales		 (Note) 4,321,405 (Note) 262,043 (Note) 4,547,241 (Note) 361,252
Computer & Peripheral
Maintenance		 〞 1,349,167
〞		 - 〞 1,457,539
〞		 -
Computer & Peripheral Lease 〞 17,909
〞		 - 〞 17,788
〞		 -
Total 〞 5,688,481
〞		 262,043
〞		 6,022,568
〞		 361,252

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

  • (2) Domestic sales are mainly in the domestic market. Export refers to the revenue of the export of the individual companies and the revenue from overseas sales of the consolidated companies based on the location of operations, mainly in Mainland China, the United States and Southeast Asia.

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  • 2.Market share of main products:

Benefited from the stable growth in demand for artificial intelligence, 5G, cloud services, information security and other related applications, coupled with the digital transformation and green and sustainable dual-axis transformation, the demand for information system services has increased, expanding from internal information systems and software packages to full system integration, driving the market scale of the computer and information service industry to expand year by year. The Ministry of Economic Affairs estimates that the output value of information service software in Taiwan will reach NTD 550 billion in 2023, a growth of about 10%. Syscom is an information provider with software and services as its main business. “One vendor provides complete solutions” is the core idea of the Company. We always think about what customers need from their standpoint.

Since its establishment nearly 50 years ago, Syscom has introduced a variety of cutting-edge products and technologies, as well as outstanding software development and integration capabilities to help customers in finance and securities, telecommunications, medical institutions, government and police administration, and high-tech manufacturing industries to successfully meet challenges.

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

  • (1) According to IDC’s survey report, the overall ICT spending of Taiwan’s industry is expected to grow by 3.7% in 2024. In particular, in terms of IT spending, the growth rate jumped to 5%; among which, the positive growth rate of 7.2% for software services is the highest, followed by hardware at 4.8%. In terms of application, emerging technology markets such as AI, blockchain, and AR/VR will attract the attention of more enterprises, and the growth potential is promising.

  • (2) As the technology and services of cloud computing become more and more mature, the crises and conflicts triggered by geopolitics continue to drive the demand for enterprises to adopt the cloud. Government agencies and organizations are becoming more and more dependent on third-party service providers, and the completeness of network security becomes more and more important. The management of hybrid environment has become the focus of growth in the information service market, such as hybrid cloud management, industrial cloud, cloud security and other solutions.

  • (3) The government has benefited from the rapid development of online marketing and the continuous promotion of digital transformation business opportunities. In recent years, smart technology applications such as high-performance computing, cloud data processing, and the IoT have boosted corporate demand for information system services and boosted the computer and information service industry. The market scale is expanding year by year.

  • (4) AI applications and related infrastructure will continue to drive the upgrade of network bandwidth. It is expected that the telecommunication service and data center markets will still have related demand for netcom equipment. In the process of 5G and 6G evolution, geopolitics, net zero sustainability, digital resilience and other key issues will closely affect the direction of 6G international competition and cooperation and technology development.

  • (5) The “5G dedicated frequency network” has been available for enterprises to apply for 5G private network since June 5, 2023, officially entering the business transformation era of 5G dedicated frequency and network. Enterprises use a dedicated network in a specific area to provide safe and high-quality dedicated network services. It can also help enterprises carry out digital transformation according to the application needs of different areas of business.

  • (6) The Ministry of Health and Welfare (MOHW) promotes smart healthcare, “Acceleration of medical information system innovation” promotes next-generation healthcare platforms, and carries out work on the standardization of data standards across the ministry’s various departments, including the construction of an innovative platform for next-generation healthcare data sharing and the “comprehensive promotion of telemedicine”.

  • (7) In response to the challenges of Taiwan’s super-aging society, the Industrial Development Administration, Ministry of Economic Affairs promotes smart health care and executes the “Smart Health Care Industry Development Promotion Program” to assist domestic manufacturers in cross-industry collaboration to develop innovative health care products and services. The use of information and communication technology, IoT, AI and other technologies to develop medical care solutions has become a global trend and is inevitable.

  • (8) The “Taiwan AI Action Plan 2.0” (2023-2026) approved by the Executive Yuan in 2023. Through the deep cultivation of AI technology and the development of the AI industry and industrial application of AI, and with the 5+2 industrial innovation program, together with

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the forward-looking infrastructure plan, we will jointly promote the popularization of the application of intelligent science and technology and services, and drive the transformation and upgrading of the country’s overall industry.

  • (9) On September 25, 2023, the Public Works Committee of the Executive Yuan officially announced the “Reference List of Basic Information Security Requirements Common to All Types of Information (Services) Procurement” and “Information Service Procurement Operational Guidelines” as a reference for information security specification on the level of security protection of the information system of each agencies. The goal is to achieve “Improvement and assurance of agency information security protection strength” and “Increase procurement efficiency and reduce contract performance disputes” in the short term. In the long run, the two major objectives of “Using government procurement to guide the industry’s information security capability” and “Using reasonable costs to create an environment for industry growth” can be realized.

  • (10) As countries gradually implement carbon tariffs and international brands gradually increase their requirements for carbon reduction from suppliers, the disclosure of carbon emission data has changed from voluntary to mandatory, testing the deployment of carbon management in the supply chain. IDC points out that carbon emission management will evolve from single product and technology innovation to cross-platform and process integration innovation. The establishment of a data-driven digital business platform will become the key technology for enterprises to control carbon emission information, and its deployment will also become more diversified, and phased in across different industries and different scales of enterprises.

4.Competitive advantages:

Syscom is the most representative system integration company in Taiwan. Since its establishment, through the introduction of various cutting-edge products and technologies, as well as outstanding software development and integration capabilities, it has helped the digital transformation of customers such as financial securities, telecommunications, medical institutions, government and police administration, transportation and high-tech manufacturing industries. Syscom’s commitment to customer service and professional execution quality is obvious to all. Not only is it the only domestic vendor that has passed the highest level of CMMI ML5 in the International Software Quality Assessment twice, but has also been affirmed twice by the National Quality Award. It has introduced quality management and capacity utilization into the entire company, and has assisted the automatic supply and installation of internal information and communication equipment with self-developed products, expand the effect of energy saving and emission reduction, and move towards a total quality and sustainable management.

The management philosophy of SYSCOM COMPUTER is "Excellent people, satisfied customers, continuous growth and sustainable management", and "system integration" is the corporate value that the Company is proud of. With nearly 50 years of accumulated professional experience and services, Syscom’s forward-looking demand planning, infinitely expandable software/hardware architecture, and dedicated technical talents help enterprises build a cloud-earth integrated digital nervous system to promote enterprise digital Transformation 2.0.

  • 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 excellent talents and has a large number of engineers with

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analysis and development capabilities in finance, medical care, government, aerospace, telecommunications, networking and other industries. It has strong R&D strength and leads the domestic industry in terms of the number of trademarks and patents obtained.

  • D. SYSCOM COMPUTER corporate brand is well-recognized by its customers for its stable management and financial soundness. Its service fields cover finance and securities, telecommunications, medical institutions, government and police administration, transportation, high-tech manufacturing, and smart retail and more, among other things, its customers are all over the world and many of them are serving as benchmarks for leading companies in various industries, and have customers with more than 20 to 30 years of cooperation.

  • 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 has 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. 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. It is not easy to develop technology talents 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. With the outflow of IT talents, it is not easy to retain technical experts. In addition to the traditional IT system architecture technical talents, more emerging digital technology software talents are attracted and transferred to the new economic markets (such as Mainland China).

  • C. Due to the lack of experience and expertise in developing the service economy in Taiwan, the lack of cases and learning processes for innovative applications and business models, there is a limited scale of the domestic market, and the information service industry is highly competitive and homogeneous.

  • D. The current Government Procurement Act does not have a special plan for innovative procurement, as product specifications and prices are not easily recognized, and price competition is more likely to exploit manufacturers’ profits.

  • E. Geopolitics and the US-China tech war continue to accelerate the restructuring of the global supply chain. The Red Sea Crisis increases the risk of global inflation and affects the delivery of goods.

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

Countermeasures ：

  • Strengthen software R&D and application, deepen the service process SOP with self-developed products, expand application services, and strengthen the application and promotion of core products and 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.

  • Establish the “ Future Committee Alliance ” to communicate regularly through the information communication platform, interact with domestic start-ups with key technologies, and find more potential partners or new talents to lead the domestic information to serve the industry to grow, transform and upgrade together.

  • The Company’s talent cultivation goal is to adopt advanced information technology and the development of well-rounded talents. Talent recruitment and promotion are “ ”

  • carried out through diversified channels such as the T Ambassador Program , “ Industry-Academia Cooperation”, “Talent Database”, “Physical Activities”, and “Recruitment Channels”.

  • Make good use of government resources to promote industrial advanced information applications in line with government policies; and actively advise the

109

government through the industry association platform to promote the development of the industry.

  • 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.

  • Maintain long-term cooperative relations with domestic and foreign suppliers, jointly establish a stable and sustainable supply chain, ensure the quality, delivery and price of suppliers ’ products, and implement risk management and business continuity plans.

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

  1. Important applications of main products:

Based on the global system integration market, Syscom acts as the agent of world-renowned ITrelated software and hardware products: HPE/Cisco/Microsoft/Fortinet/VMWare, and according to customer demand to carry out software and hardware system integration and application software development to assist customers in digital transformation. After the completion of the project, the software and hardware products and services can be upgraded to maintenance and warranty services according to the project specifications. The service fields cover: Finance and securities, telecommunications, medical institutions, government and police administration, transportation, e-retail and high-tech manufacturing and more.

During the production process, the Company strictly follows the CMMI-Dve v1.2 Maturity Level 5 software process, and uses the self-developed project management platform, Software Development Process Master (SDPM) to formulate standard operating procedures for the software design and development process, through quantitative management, to have a clear understanding of the project status, to take preventive and corrective measures in advance, and to improve work efficiency. In recent years, it has expanded its introduction to technical service project management, and used the Technical Service Management (TSM) to manage customers’ equipment installation, maintenance, and warranty projects, in order to provide customers with the most satisfied quality and service. Syscom also uses its own R&D products, such as OMFLOW and NET Center, to strengthen the functions of automation, real-time, and visualization, assisting the automatic provisioning of internal information and communication equipment, improving efficiency, and reducing labor cost, thereby further expanding the effectiveness of energy conservation and emission reduction.

  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.

110

  • (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

Item 2022 2022 2022 2023 2023 2023
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
1 Customer A 536,647 9.02% None Customer A 519,982
8.15%
None
Total 536,647 9.02% Total 519,982
8.15%
Net sales 5,950,524 100.00% Net sales 6,383,820
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.

  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

Item 2022 2022 2022 2022 2023 2023 2023 2023
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
1 Zero One
Technology		 313,135 11.98% None Metaage 487,693
17.32%
None
2 Metaage 284,485 10.88% None Zero One
Technology		 304,866
10.82%
None
3 Microsoft 281,824
10.01%
None
Total 597,620 22.86% Total 1,074,383
38.15%
Net
purchases		 2,613,654 100.00% Net
purchases		 2,816,571
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.

  • (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.

111

(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
2022		 2023

Domestic sales		 Export sales Domestic sales Export sales
Volume Value Volume Value Volume Value Volume Value
System Integration
Service &
Computer/Peripheral
Sales		 (Note) 4,321,405 (Note) 262,043 (Note) 4,547,241 (Note) 361,252
Computer & Peripheral
Maintenance		 〞 1,349,167
〞		 - 〞 1,457,539
〞		 -
Computer & Peripheral
Lease		 〞 17,909
〞		 - 〞 17,788
〞		 -
Total 〞 5,688,481
〞		 262,043
〞		 6,022,568
〞		 361,252
Note: (1) The Company is in the information service industry and not in the manufacturing industry, so it is not
applicable.
(2) Domestic sales are mainly in the domestic market. Export refers to the revenue of the export of the
individual companies and the revenue from overseas sales of the consolidated companies based on the
location of operations, mainly in Mainland China, the United States and Southeast Asia.
III. Information on employees
Year
As of the end of 2022 As of the end of 2023
Number of employees
1,187
1,266
Average age
40.72
41.14
Averageyears of service
9.13
9.33
As a percentage
of education
distribution
Doctorate
0
1
Master
242
282
College(includingabove)
928
964
Senior high school(includingbelow)
17
19

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:

      • 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.

112 

  - 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.

3. Workplace diversity

  • (1) Workplace diversity policy:

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) Implement diversity in the workplace:

  • A. The Company’s male and female employees have equal opportunities for promotion. Female employees account for 31.12%, and female managers account for 21.09% of the Company’s managers.

  • B. 99.76% were of Taiwanese nationality, 0.24% of foreign nationals, 0.47% of indigenous people, and 1.03% of persons with disabilities.

  • C. 19.43% of employees are under the age of 30, 54.98% are between the ages of 30 and 50, and 25.59% are over the age of 50.

4. 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

113

internal training and external training have a positive effect on their professional skills and 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 2023, the Company had 7,263 attendance in internal training and external training, and the cost of education and training was approximately NT$6.75 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

114

lights, escape doors, etc., is in place, and 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)The building is disinfected every six months and the floor cleaning and waxing operations are carried out every month; in line with the post-pandemic prevention measures, the Company continues to strengthen the promotion of the concept of public health and cleaning and disinfection. Every day, colleagues and visitors to the Company are still recommended to wear masks and continue to Body temperature is measured and hands are disinfected. Alcohol and antibacterial hand sanitizer is placed at the entrance of each floor. Antibacterial hand sanitizer is also placed in the pantry. Alcohol/antibacterial hand sanitizer is also placed in each meeting room for colleagues and 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)General safety and health on-the-job training courses are held each year. In 2023, a total of 1,266 person-times and a total of 3,798 man-hours were held.

  - (12)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.

  - (13)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.

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

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

  - (16)The Company has completed fire safety facilities, and conducts routine employee fire escape drills and related education and training courses every year to reduce the probability of fire, and there was no fire incident in 2023.

  • (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

115

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.

  1. 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 2023 was reported to the Board of Directors on December 14, 2023.

  2. (II) Information security policy

  3. 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.

  4. 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.

  5. (III) Information security management system

  6. 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 27701:2019) for information security management.

  7. 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.

  8. 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.

  9. 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.

  10. Privacy information management system: in accordance with standard ISO 27701:2019 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

116

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. 

  2. Continue to improve the Company’s internal information security Continue to take stock of information and upgrade its information security protection mechanism. EDR protection is expected to be added. Internal offensive and defensive drills are expected to find information security loopholes and strengthen them.

  • (V) Annual information security risk status

  • Continue to maintain and refine ISO20000, ISO27001, ISO27701 and BS10012 information security management system. In 2023, there were 9 audits and 34 units were audited by the third-party. The validity audit was completed by the end of 2023.

  • 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 October 2023, information security education and training courses were held for 1,270 employees, totaling 4,445 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

117

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
Unit: Thousands of NTD
Year
Item
Financial Summary for The Last Five Years
2019 2020 2021 2022 2023
Current assets 3,433,397
3,554,576
3,502,741
3,764,749
4,016,109
Property, Plant and Equipment 407,341
362,489
370,818
357,328
362,728
Intangible assets 20,489
3,656
2,743
2,410
2,312
Other assets 456,962
369,145
358,027
310,453
465,121
Total assets 4,318,189
4,289,866
4,234,329
4,434,940
4,846,270
Current
liabilities		 Before distribution 2,277,355
2,215,942
2,136,747
2,284,257
2,612,316
After distribution 2,377,355
2,365,942
2,326,747
2,504,257
2,852,316
（Note 1）
Non-current liabilities 225,952
179,220
122,825
95,870
116,650
Total
liabilities		 Before distribution 2,503,307
2,395,162
2,259,572
2,380,127
2,728,966
After distribution 2,603,307
2,545,162
2,449,572
2,600,127
2,968,966
（Note 1）
Equity attributable to
shareholders of the parent		 1,797,504
1,882,901
1,964,116
2,049,845
2,114,207
Capital stock 1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
Capital surplus 1,130
1,521
1,547
1,547
1,797
Retained
earnings		 Before distribution 811,036
898,606
969,490
1,044,551
1,100,682
After distribution 711,036
748,606
779,490
824,551
860,682
（Note 1）
Other equity interest (14,662)
(17,226)
(6,921)
3,747
11,728
Treasury stock - - - - -
Non-controlling interest 17,378
11,803
10,641
4,968
3,097
Total
equity		 Before distribution 1,814,882
1,894,704
1,974,757
2,054,813
2,117,304
After distribution 1,714,882
1,744,704
1,784,757
1,834,813
1,877,304
（Note 1）

Note 1 ： Proposal of the Company’s 2023 earnings appropriation, the Board of Directors resolved on March 12, 2024 to distribute cash dividends.

Note 2 ： The financial information for the first quarter of 2024 has not been reviewed by CPAs and has not been disclosed as of the date of publication of the annual report.

118

2.Parent Condensed Balance Sheet–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
2019 2020 2021 2022 2023
Current assets 2,898,081
3,211,798		 3,153,985
3,426,661
3,707,640
Property, Plant and Equipment 376,412
333,917
343,436
328,345
336,501
Intangible assets 8,812
957
592
492
392
Other asset 670,066
547,488
526,092
489,557
645,571
Total assets 3,953,371
4,094,160		 4,024,105
4,245,055
4,690,104
Current
liabilities		 Before distribution 1,940,914
2,038,238		 1,924,679
2,040,140
2,372,008
After distribution 2,040,914
2,188,238		 2,114,679
2,260,140
2,612,008
(Note 1)
Non-current liabilities 214,953
173,021
135,310
155,070
203,889
Total
liabilities		 Before distribution 2,155,867
2,211,259		 2,059,989
2,195,210
2,575,897
After distribution 2,255,867
2,361,259		 2,249,989
2,415,210
2,815,897
(Note 1)
Capital stock 1,000,000
1,000,000		 1,000,000
1,000,000
1,000,000
Capital surplus 1,130
1,521
1,547
1,547
1,797
Retained
earnings		 Before distribution 811,036
898,606
969,490
1,044,551
1,100,682
After distribution 711,036
748,606
779,490
824,551
860,682
(Note 1)
Other equity interest (14,662)
(17,226)
(6,921)
3,747
11,728
Treasury stock - - - - -
Total
equity		 Before distribution 1,797,504
1,882,901		 1,964,116
2,049,845
2,114,207
After distribution 1,697,504
1,732,901		 1,774,116
1,829,845
1,874,207
(Note 1)

Note 1 ： Proposal of the Company’s 2023 earnings appropriation, the Board of Directors resolved on March 12, 2024 to distribute cash dividends.

119

(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
Year
Item
Financial Summary for The Last Five Years
2019 2020 2021 2022 2023
Operating revenue 5,910,857
5,757,866
5,869,595
5,950,524
6,383,820
Gross profit 1,244,168
1,310,988
1,424,263
1,518,500
1,660,878
Income from operations 100,240
163,353
254,826
264,405
285,459
Non-operating income
and expenses		 50,496
49,545
17,031
40,251
44,048
Income before tax 150,736
212,898
271,857
304,656
329,507
Income from operations
of continued segments
(after tax)		 124,937
166,842
214,977
244,945
276,638
Income from
discontinued operations		 - - - - -
Net income (Loss) 124,937
166,842
214,977
244,945
276,638
Other comprehensive
income (after tax)		 (8,314)
15,030
15,297
25,146
5,961
Total comprehensive
income		 116,623
181,872
230,274
270,091
282,599
Net income attributable
to shareholders of the
parent		 129,150
169,958
215,822
250,730
278,293
Net income attributable
to non- controlling
interest		 (4,213)
(3,116)
(845)
(5,785)
(1,655)
Comprehensive income
attributable to
Shareholders of the
paren		 121,125
185,006
231,189
275,729
284,112
Comprehensive income
attributable to non-
controlling interest		 (4,502)
(3,134)
(915)
(5,638)
(1,513)
Earnings per
share(NT$)		 1.29
1.70
2.16
2.51
2.78

Note 1 ： The financial information for the first quarter of 2024 has not been reviewed by CPAs and has not been disclosed as of the date of publication of the annual report.

120

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
2019 2020 2021 2022 2023
Operating revenue 5,411,715
5,481,240		 5,578,076
5,674,679
6,115,419
Gross profit 1,112,588
1,223,666		 1,320,916
1,417,403
1,550,938
Income from operations 134,584
212,777		 283,481
291,698
298,837
Non-operating income
and expenses		 22,447
2,316		 (11,302)
17,954
32,264
Income before tax 157,031
215,093		 272,179
309,652
331,101
Income from operations
of continued segments
(after tax)		 129,150
169,958		 215,822
250,730
278,293
Income from
discontinued operations		 - - - - -
Net income (Loss) 129,150
169,958		 215,822
250,730
278,293
Other comprehensive
income (after tax)		 (8,025)
15,048		 15,367
24,999
5,819
Total comprehensive
income		 121,125
185,006		 231,189
275,729
284,112
Net income attributable
to shareholders of the
parent		 129,150
169,958		 215,822
250,730
278,293
Net income attributable
to non- controlling
interest		 - - - - -
Comprehensive income
attributable to
Shareholders of the
parent		 121,125
185,006		 231,189
275,729
284,112
Comprehensive income
attributable to
noncontrolling interest		 - - - - -
Earningsper share(NT$) 1.29
1.70		 2.16
2.51
2.78
  • (III)Auditors’ Opinions in the last five years
Year Accounting Firm CPA Audit Opinion
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
2023 Deloitte & Touche Li-Wen Kuo
Pei-De Chen		 An unmodified opinion with emphasis of other
matter paragraph

121

II. Financial analysis for the most recent 5 years

II. Financial analysis for the most recent 5 years II. Financial analysis for the most recent 5 years II. Financial analysis for the most recent 5 years II. Financial analysis for the most recent 5 years II. Financial analysis for the most recent 5 years II. Financial analysis for the most recent 5 years II. Financial analysis for the most recent 5 years
(I)Consolidated Financial Analysis–Based on IFRS
Item Year Financial Analysis for the Last Five Years
2019 2020 2021 2022 2023
Financial
structure (%)		 Debt Ratio 57.97 55.83 53.36 53.67 56.31
Ratio of long-term capital to property,
plant and equipment		 510.01 572.13 565.66 601.88 615.88
Solvency (%) Current ratio 150.76 160.41 163.93 164.81 153.74
Quick ratio 120.26 122.06 136.41 128.17 119.73
Interest earned ratio (times) 10.99 24.20 56.71 39.93 20.29
Operating
performance		 Accounts receivable turnover (times) 5.51 4.84 4.32 3.87 4.36
Average collection period 66.24 75.41 84.49 94.31 83.71
Inventory turnover (times) 11.31 8.71 10.22 11.71 10.13
Accounts payable turnover (times) 4.15 3.13 3.13 3.24 3.29
Average days in sales 32.27 41.90 35.71 31.16 36.03
Property, plant and equipment turnover
(times)		 14.51 15.88 15.83 16.65 17.60
Total asset turnover (times) 1.37 1.34 1.39 1.34 1.32
Profitability Return on total assets (%) 3.58 4.05 5.14 5.80 6.26
Return on stockholders'equity (%) 7.00 9.00 11.11 12.16 13.26
Ratio of pre-tax income to paid-in
capital (%)		 15.07 21.29 27.19 30.47 32.95
Profit ratio (%) 2.11 2.90 3.66 4.12 4.33
Earnings per share (NT$) 1.29 1.70 2.16 2.51 2.78
Cash flow Cash flow ratio (%) (3.91) 24.99 8.98 9.28 25.02
Cash flow adequacy ratio (%) 100.34 103.74 121.40 104.88 117.21
Cash reinvestment ratio (%) (6.54) 20.72 1.88 0.94 18.83
Leverage Operating leverage - - - - -
Financial leverage - - - - -
Analysis of financial ratio differences for the last two years：not applicable.

Note 1: The financial information for the first quarter of 2024 has not been reviewed by CPAs and has not been disclosed as of the date of publication of the annual report.

Note 2: The calculation formula goes as follows.

  1. Financial Structure

  2. (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

  3. (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

  • Profitability

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

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

122

  • (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 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)

123

(II)Parent Financial Analysis–Based on IFRS

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
2019 2020 2021 2022 2023
Financial
structure (%)		 Debt Ratio 54.53 54.01 51.19 51.71 54.92
Ratio of long-term capital to
property, plant and equipment		 534.64 615.70 611.30 671.52 688.88
Solvency
(%)		 Current ratio 149.32 157.58 163.87 167.96 156.31
Quick ratio 115.64 117.10 134.96 128.88 119.72
Interest earned ratio(times) 32.2 57.6 176.7 990.3 118.8
Operating
performance		 Accounts receivable turnover
(times)		 5.54 5.07 4.42 3.94 4.46
Average collection period 65.88 71.99 82.57 92.63 81.83
Inventory turnover (times) 11.41 8.81 10.37 12.27 10.36
Accounts payable turnover (times) 3.97 3.07 3.04 3.15 3.20
Average days in sales 31.98 41.43 35.19 29.74 35.23
Property, plant and equipment
turnover (times)		 14.38 16.41 16.24 17.28 18.17
Total asset turnover (times) 1.37 1.34 1.39 1.34 1.30
Profitability Return on total assets (%) 3.77 4.30 5.35 6.07 6.28
Return on stockholders'equity (%) 7.32 9.24 11.22 12.49 13.37
Ratio of pre-tax income to paid-in
capital (%)		 15.70 21.51 27.22 30.97 33.11
Profit ratio (%) 2.39 3.10 3.87 4.42 4.55
Earnings per share (NT$) 1.29 1.70 2.16 2.51 2.78
Cash flow Cash flow ratio (%) (1.72) 26.27 11.23 11.21 27.92
Cash flow adequacy ratio (%) 100.36 95.85 119.07 103.94 117.73
Cash reinvestment ratio (%) (4.00) 20.27 3.00 1.63 18.79
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

124

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)

125

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 2023 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

2024 Annual Shareholders’ Meeting of Syscom Computer Engineering Co.

Audit Committee Convener: Che-Fu Kung

March 12, 2024

126

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, 2023 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 12, 2024

127

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Syscom Computer Engineering Company

Opinion

We have audited the accompanying consolidated financial statements of Syscom Computer Engineering Company (the “Company”) and its subsidiaries (collectively, the “Group”), which comprise the consolidated balance sheets as of December 31, 2023 and 2022, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the consolidated financial statements, 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, 2023 and 2022, and its consolidated financial performance and consolidated cash flows for the years then ended in accordance 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) endorsed and issued into effect by the Financial Supervisory Commission 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 consolidated financial statements for the year ended December 31, 2023. 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 for the Group's consolidated financial statements for the year ended December 31, 2023 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.

128

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 were audited by other auditors. Therefore, in our opinion on the consolidated financial statements as mentioned above, the amounts shown in such subsidiaries’ financial statements were recognized based on the audit reports prepared by other auditors. The total assets of the above subsidiaries as of December 31, 2023 and 2022 were NT$249,503 thousands and NT$282,734 thousands, respectively, which represented 5% and 6% of the total consolidated assets; the net operating revenue for the years ended December 31, 2023 and 2022 was NT$117,228 thousands and NT$152,396 thousands, which represented 2% and 3% of the net consolidated operating revenue.

We have also audited the parent company only financial statements of Syscom Computer Engineering Company as of and for the years ended December 31, 2023 and 2022 on which we have issued an unmodified opinion with the other matter section

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

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

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

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Standards on Auditing of the Republic of China will always detect a material misstatement when it exists.

129

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

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

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

  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 group audit. We remain solely responsible for our audit opinion.

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

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

130

The engagement partners on the audit resulting in this independent auditors’ report are Li-Wen Kuo and Pei-De Chen.

Deloitte & Touche Taipei, Taiwan Republic of China March 12, 2024

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.

131

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2023 AND 2022

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 and 27)
Right-of-use assets (Notes 4 ,15 and 27)
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 benefit liabilities - non-current (Notes 4 and 19)
Guarantee deposits received
Total non-current liabilities
Total liabilities
EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY (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 Company
Non-controlling interests (Note 20)
Total equity
TOTAL		 December 31, 2023 December 31, 2023 (In Thousands of New Taiwan

December 31, 2022
％
Amount
18
$ 600,941
-
19,956
5
202,721
10
486,381
-
2,598
29
1,489,172
-
6,054
-
265
10
453,997
9
383,124
2

119,540

83

3,764,749

1
25,737
4
129,195
1
69,518
8
357,328
2
20,655
-
2,410
-
13,665
1

51,683

17

670,191

100
$ 4,434,940

4
$ 180,922
10
238,583
-
16,026
30
1,400,023
9
392,297
-
33,097
1
8,513
-

14,796

54

2,284,257

-
11,130
1
12,426
1
54,658
-

17,656

2

95,870

56

2,380,127

21

1,000,000

-

1,547

7
303,977
-
17,619
16

722,955

23

1,044,511

-

3,747

44
2,049,845
-

4,968

44

2,054,813

100
$ 4,434,940
 (In Thousands of New Taiwan

December 31, 2022
％
Amount
18
$ 600,941
-
19,956
5
202,721
10
486,381
-
2,598
29
1,489,172
-
6,054
-
265
10
453,997
9
383,124
2

119,540

83

3,764,749

1
25,737
4
129,195
1
69,518
8
357,328
2
20,655
-
2,410
-
13,665
1

51,683

17

670,191

100
$ 4,434,940

4
$ 180,922
10
238,583
-
16,026
30
1,400,023
9
392,297
-
33,097
1
8,513
-

14,796

54

2,284,257

-
11,130
1
12,426
1
54,658
-

17,656

2

95,870

56

2,380,127

21

1,000,000

-

1,547

7
303,977
-
17,619
16

722,955

23

1,044,511

-

3,747

44
2,049,845
-

4,968

44

2,054,813

100
$ 4,434,940
 (In Thousands of New Taiwan

December 31, 2022
％
Amount
18
$ 600,941
-
19,956
5
202,721
10
486,381
-
2,598
29
1,489,172
-
6,054
-
265
10
453,997
9
383,124
2

119,540

83

3,764,749

1
25,737
4
129,195
1
69,518
8
357,328
2
20,655
-
2,410
-
13,665
1

51,683

17

670,191

100
$ 4,434,940

4
$ 180,922
10
238,583
-
16,026
30
1,400,023
9
392,297
-
33,097
1
8,513
-

14,796

54

2,284,257

-
11,130
1
12,426
1
54,658
-

17,656

2

95,870

56

2,380,127

21

1,000,000

-

1,547

7
303,977
-
17,619
16

722,955

23

1,044,511

-

3,747

44
2,049,845
-

4,968

44

2,054,813

100
$ 4,434,940
 (In Thousands of New Taiwan

December 31, 2022
％
Amount
18
$ 600,941
-
19,956
5
202,721
10
486,381
-
2,598
29
1,489,172
-
6,054
-
265
10
453,997
9
383,124
2

119,540

83

3,764,749

1
25,737
4
129,195
1
69,518
8
357,328
2
20,655
-
2,410
-
13,665
1

51,683

17

670,191

100
$ 4,434,940

4
$ 180,922
10
238,583
-
16,026
30
1,400,023
9
392,297
-
33,097
1
8,513
-

14,796

54

2,284,257

-
11,130
1
12,426
1
54,658
-

17,656

2

95,870

56

2,380,127

21

1,000,000

-

1,547

7
303,977
-
17,619
16

722,955

23

1,044,511

-

3,747

44
2,049,845
-

4,968

44

2,054,813

100
$ 4,434,940
 Dollars)
Amount
$ 884,494
10,457
215,604
483,322
12,062
1,425,698
6,316
286
473,593
414,915
89,362
4,016,109
33,026
197,876
67,858
362,728
94,888
2,312
12,486
58,987
830,161
$ 4,846,270
$ 190,855
465,330
131
1,453,533
417,993
20,234
46,175
18,065
2,612,316
10,429
49,503
41,947
14,771
116,650
2,278,966
1,000,000
1,797
330,483
17,619
752,580
1,100,682
11,728
2,114,207
3,097
2,117,304
$ 4,846,270		 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		 ％








































































13
-
5
11
-
34
-
-
10
9
3
85
1
3
2
8
-
-
-
1
15
100
4
6
-
32
9
1
-
-
52
-
-
1
1
2
54
22
-
7
1
16
24
-
46
-
46
100

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

(With Deloitte & Touche auditors’ report dated March 12, 2024)

132

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31,2023 AND 2022

(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
 2023 ％
77

23
-

100

58
16
-

74

26

18
4
-

22

4

-
1
-

-

-

1

5
1

4
 2022
Amount
$ 4,908,493
1,457,539
17,788

6,383,820

3,679,377
1,029,322
14,243

4,722,942

1,660,878

1,126,074
242,585
6,760

1,375,419

285,459

10,435
53,923

2,707 )

17,080 )

523)

44,048

329,507
52,869

276,638
 Amount
％
$ 4,583,448
77
1,349,167
23
17,909

-
5,950,524
100
3,447,531
58
969,922
17
14,571

-
4,432,024

75
1,518,500

25
1,024,057
17
230,033
4
5

-
1,254,095

21
264,405

4
4,043
-
62,094
1

23,093 )
-

7,826 )
-
5,033

-
40,251

1
304,656
5
59,711

1
244,945

4
(Continued)		 ％









(
(
(



















(
(

133

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
NET INCOME ATTRIBUTABLE TO:
8610
Owners of the Company

8620
Non-controlling interests

8600

TOTAL COMPREHENSIVE INCOME
(LOSS) ATTRIBUTABLE TO:
8710
Owners of the Company

8720
Non-controlling interests

8700

EARNINGS PER SHARE (Note 24)
9710
Basic

9810
Diluted
 2023 ％
-

-
-

-

-

-

4

4

-

4

4

-

4


 2022
Amount
$ 2,700 )
7,289
618
923

169)

5,961

$ 282,599

$ 278,293

1,655)

$ 276,638

$ 284,112

1,513)

$ 282,599

$ 2.78
$ 2.78		 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		 ％
(
(



(


(






(

(



(


(





1
-
-
-
-
1
5
4
-
4
5
-
5

The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ report dated March 12, 2024)

(Concluded)

134

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED DECEMBER 31,2023 AND 2022

C o d e
A1
BALANCE AT JANUARY 1, 2022

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

Appropriation of the 2022 earnings
B1
Legal reserve
B5
Cash dividends - NT$2.2 per share
D1
Net profit for the year ended December 31, 2023
D3
Other comprehensive income (loss) for the year
ended December 31, 2023, net of income tax
D5
Total comprehensive income (loss) for the year
ended December 31, 2023
C3
Unclaimed dividends
M5
Actual acquisition of interests in subsidiaries
O1
Cash dividends from subsidiary

Z1
BALANCE AT DECEMBER 31, 2023
 Equity attributable to ow Equity attributable to ow ners ofthe Corporation ( In Thousands of New Taiwan Dollars, except Dividend Per Share)

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
Total
Non-controlling
interests
Totalequity
( $ 20,350 )
$ 13,429
$ 1,964,116
$ 10,641
$ 1,974,757
-
-
-
-
-
-
-
(
190,000 )
-
(
190,000 )
-
-
250,730
(
5,785 )
244,945

9,758

910

24,999

147

25,146

9,758

910

275,729
(
5,638)

270,091

-

-

-
(
35)
(
35)
(
10,592 )
14,339
2,049,845
4,968
2,054,813
-
-
-
-
-
-
-
(
220,000 )
-
(
220,000 )
-
-
278,293
(
1,655 )
276,638

692

7,289

5,819

142

5,961

692

7,289

284,112
(
1,513)

282,599
-
-
522
-
522
-
-
(
272 )
(
330 )
(
602 )

-

-

-
(
28)
(
28)
($ 9,900)
$ 21,628
$ 2,114,207
$ 3,097
$ 2,117,304		 ( In Thousands of New Taiwan Dollars, except Dividend Per Share)

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
Total
Non-controlling
interests
Totalequity
( $ 20,350 )
$ 13,429
$ 1,964,116
$ 10,641
$ 1,974,757
-
-
-
-
-
-
-
(
190,000 )
-
(
190,000 )
-
-
250,730
(
5,785 )
244,945

9,758

910

24,999

147

25,146

9,758

910

275,729
(
5,638)

270,091

-

-

-
(
35)
(
35)
(
10,592 )
14,339
2,049,845
4,968
2,054,813
-
-
-
-
-
-
-
(
220,000 )
-
(
220,000 )
-
-
278,293
(
1,655 )
276,638

692

7,289

5,819

142

5,961

692

7,289

284,112
(
1,513)

282,599
-
-
522
-
522
-
-
(
272 )
(
330 )
(
602 )

-

-

-
(
28)
(
28)
($ 9,900)
$ 21,628
$ 2,114,207
$ 3,097
$ 2,117,304		 ( In Thousands of New Taiwan Dollars, except Dividend Per Share)

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
Total
Non-controlling
interests
Totalequity
( $ 20,350 )
$ 13,429
$ 1,964,116
$ 10,641
$ 1,974,757
-
-
-
-
-
-
-
(
190,000 )
-
(
190,000 )
-
-
250,730
(
5,785 )
244,945

9,758

910

24,999

147

25,146

9,758

910

275,729
(
5,638)

270,091

-

-

-
(
35)
(
35)
(
10,592 )
14,339
2,049,845
4,968
2,054,813
-
-
-
-
-
-
-
(
220,000 )
-
(
220,000 )
-
-
278,293
(
1,655 )
276,638

692

7,289

5,819

142

5,961

692

7,289

284,112
(
1,513)

282,599
-
-
522
-
522
-
-
(
272 )
(
330 )
(
602 )

-

-

-
(
28)
(
28)
($ 9,900)
$ 21,628
$ 2,114,207
$ 3,097
$ 2,117,304		 ( In Thousands of New Taiwan Dollars, except Dividend Per Share)

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
Total
Non-controlling
interests
Totalequity
( $ 20,350 )
$ 13,429
$ 1,964,116
$ 10,641
$ 1,974,757
-
-
-
-
-
-
-
(
190,000 )
-
(
190,000 )
-
-
250,730
(
5,785 )
244,945

9,758

910

24,999

147

25,146

9,758

910

275,729
(
5,638)

270,091

-

-

-
(
35)
(
35)
(
10,592 )
14,339
2,049,845
4,968
2,054,813
-
-
-
-
-
-
-
(
220,000 )
-
(
220,000 )
-
-
278,293
(
1,655 )
276,638

692

7,289

5,819

142

5,961

692

7,289

284,112
(
1,513)

282,599
-
-
522
-
522
-
-
(
272 )
(
330 )
(
602 )

-

-

-
(
28)
(
28)
($ 9,900)
$ 21,628
$ 2,114,207
$ 3,097
$ 2,117,304		 ( In Thousands of New Taiwan Dollars, except Dividend Per Share)

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
Total
Non-controlling
interests
Totalequity
( $ 20,350 )
$ 13,429
$ 1,964,116
$ 10,641
$ 1,974,757
-
-
-
-
-
-
-
(
190,000 )
-
(
190,000 )
-
-
250,730
(
5,785 )
244,945

9,758

910

24,999

147

25,146

9,758

910

275,729
(
5,638)

270,091

-

-

-
(
35)
(
35)
(
10,592 )
14,339
2,049,845
4,968
2,054,813
-
-
-
-
-
-
-
(
220,000 )
-
(
220,000 )
-
-
278,293
(
1,655 )
276,638

692

7,289

5,819

142

5,961

692

7,289

284,112
(
1,513)

282,599
-
-
522
-
522
-
-
(
272 )
(
330 )
(
602 )

-

-

-
(
28)
(
28)
($ 9,900)
$ 21,628
$ 2,114,207
$ 3,097
$ 2,117,304
Share capital -
ordinary shares
$ 1,000,000

-
-

-

-


-


-

1,000,000
-
-

-

-


-

-
-


-

$ 1,000,000
 Capitalsurplus
$ 1,547

-
-
-

-


-


-

1,547
-
-
-

-


-

522
(
272 )

-

$ 1,797
 Retained earnings Unappropriated
earnings
$ 669,982

(
22,088 )
(
190,000 )
250,730

14,331


265,061


-

722,955

(
26,506 )
(
220,000 )
278,293
(
2,162)


276,131

-
-

-

$ 752,580
 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
( $ 20,350 )
$ 13,429

-
-
-
-

-
-

9,758

910


9,758

910


-

-

(
10,592 )
14,339

-
-
-
-

-
-

692

7,289


692

7,289

-
-
-
-


-

-

($ 9,900)
$ 21,628
Exchange
differences on
translating the
financial statements
of foreign
operations

( $ 20,350 )

-
-
-

9,758


9,758


-

(
10,592 )
-
-
-

692


692

-
-

-

($ 9,900)
Legal reserve
$ 281,889

22,088
-
-
-

-

-

303,977
26,506
-
-
-

-

-
-
-

$ 330,483
 Special reserve
$ 17,619

-

-

-

-


-


-

17,619
-

-

-

-


-

-
-

-

$ 17,619
















(














(
(



(
(
(


 (



(



(







(




(


(
(


(

(


(
(
 $ 1,974,757
-

190,000 )
244,945
25,146
270,091

35)
2,054,813
-

220,000 )
276,638
5,961
282,599
522

602 )

28)
$ 2,117,304

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

(With Deloitte & Touche auditors’ report dated March 12, 2024)

135

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31,2023 AND 2022

(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
A23700
Write-downs of inventories
A24100
Net loss 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 generated from operations
A33100
Interest received
A33200
Dividends received		 2023
$ 329,507
110,625
677
6,760

2,309 )
17,080

10,435 )

586 )
523

141 )
165
3,143

164 )
3,059

9,464 )
55,553

281 )

27,175 )

31,873 )
1,768
226,747

15,895 )
53,302
25,674
3,269
15,411)
724,118
10,436
586		 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

(Continued)

136

Code
A33300
Interest paid
A33500
Income tax paid
AAAA
Net cash generated 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
B03800
Decrease(Increase) in refundable deposits
B04500
Payments for intangible assets
BBBB
Net cash (used in) generated 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
C09900
Unclaimed dividends
CCCC
Net cash used in 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		 2023
$ 16,872 )
64,661)
653,607
-

81,564 )

14,500 )
26,308

59,329 )
331
21,106
588)
108,236)
10,478

2,885 )

48,745 )

220,000 )

602 )

24 )
522
261,256)
562)
283,553
600,941
$ 884,494		 2022
(
(

(
(

(
(
(
(
(
(
(
(

(
(

 (
(

(
(
(
(
(

(
(
(

(


 $ 7,145 )
58,209)
212,024

2,379 )
694

727,950 )
943,435

48,452 )
429

51,298 )
265)
114,214
28,380
3,926

45,908 )

190,000 )
-

35 )
-
203,637)
10,240
132,841
468,100
$ 600,941

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

(With Deloitte & Touche auditors’ report dated March 12, 2024)

(Concluded)

137

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Notes to Consolidated Financial Statements Years Ended December 31, 2023 and 2022

(Amounts in thousands of NTD, unless stated otherwise)

  1. General

SYSCOM COMPUTER ENGINEERING CO. (the " Company") was incorporated in July 1975. The Company mainly leases and sells computer systems and designs computer software. It also provides services for the integration of computer information systems and maintenances of computer hardware. The Company's shares have been listed on the Taiwan Stock Exchange since May 22, 2001.

The financial statements are presented in the Company’s functional currency, New Taiwan dollars. 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 12, 2024.

  1. Application of New and Revised Standards and Interpretations

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

Except for the following, the initial application of the IFRS Accounting Standards endorsed and issued into effect by the FSC did not have material impact on the Group’s accounting policies: Amendments to IAS 1 “Disclosure of Accounting Policies”

When applying the amendments, the Group refers to the definition of material to determine its material accounting policy information to be disclosed. Accounting policy information is material if it can reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements. Moreover:

  • Accounting policy information that relates to immaterial transactions, other events or conditions is immaterial and need not be disclosed;

  • The Group may consider the accounting policy information material because of the nature of the related transactions, other events or conditions, even if the amounts are immaterial; and

  • Not all accounting policy information relating to material transactions, other events or conditions is itself material.

The accounting policy information is likely to be considered material to the financial statements if that information relates to material transactions, other events or conditions and:

  • A. The Group changed its accounting policy during the reporting period and this change resulted in a material change to the information in the financial statements;

  • B. The Group chose the accounting policy from options permitted by the standards;

  • C. The accounting policy was developed in accordance with IAS 8 “Accounting Policies, Changes in Accounting Estimates and Errors” in the absence of an IFRS that specifically applies;

  • D. The accounting policy relates to an area for which the Group is required to make significant judgments or assumptions in applying an accounting policy, and the Group discloses those judgments or assumptions; or

  • E. The accounting is complex, and users of the financial statements would otherwise not understand those material transactions, other events or conditions.

  • Refer to Note 4 for related accounting policy information.

(2) The IFRS Accounting Standards endorsed by the FSC for application starting from 2024.
New/Amended/Revised Standards andInterpretations
Effective Date
Announced byIASB(Note1)
Amendments to IFRS 16 “Leases Liability in a Sale and
Leaseback”
January 1, 2024 (Note 2)
Amendments to IAS 1 “Classification of Liabilities as Current or
Non-current”
January 1, 2024
Amendments to IAS 1 “Non-current Liabilities with Covenants” January 1, 2024
Amendments to IAS 7 and IFRS 7 “Supplier Finance
Arrangements”
January 1, 2024 (Note 3)		 The IFRS Accounting Standards endorsed by the FSC for application starting from 2024.
New/Amended/Revised Standards andInterpretations
Effective Date
Announced byIASB(Note1)
Amendments to IFRS 16 “Leases Liability in a Sale and
Leaseback”
January 1, 2024 (Note 2)
Amendments to IAS 1 “Classification of Liabilities as Current or
Non-current”
January 1, 2024
Amendments to IAS 1 “Non-current Liabilities with Covenants” January 1, 2024
Amendments to IAS 7 and IFRS 7 “Supplier Finance
Arrangements”
January 1, 2024 (Note 3)
January 1, 2024 (Note 2)
January 1, 2024
January 1, 2024
January 1, 2024 (Note 3)

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

138

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.

Note 3: The amendments provide some transition relief regarding disclosure requirements. As of the date the consolidated financial statements were authorized for issue, the Group has assessed that the application of other standards and interpretations will not have a material impact on the Group’s financial position and financial performance.

  • (3) IFRSs issued by the IASB but not yet endorsed and issued into effect by the FSC

Effective Date Announced by New/Amended/Revised Standards and Interpretations the IASB (Note 1) Amendments to IFRS 10 and IAS 28 “Sale or Contribution of To be determined by IASB Assets between an Investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” January 1, 2023 Amendments to IFRS 17 January 1, 2023 Amendments to IFRS 17 “Initial Application of IFRS 9 and January 1, 2023 IFRS 17 - Comparative Information” Amendments to IAS 21 “Lack of Exchangeability” January 1, 2025 (Note 2)

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

  • Note 2: An entity shall apply those amendments for annual reporting periods beginning on or after January 1, 2025. Upon initial application of the amendments, the entity recognizes any effect as an adjustment to the opening balance of retained earnings. When the entity uses a presentation currency other than its functional currency, it shall, at the date of initial application, recognize any effect as an adjustment to the cumulative amount of translation differences in equity.

As of the date the Group’s consolidated financial statements were authorized for issue, the Group is continuously assessing the possible impact of the application of other standards and interpretations on the Group’s financial position and financial performance and will disclose the relevant impact when the assessment is completed.

4. Summary of Significant Accounting Policies (1) Statement of Compliance

The consolidated financial statements have been prepared in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs endorsed and issued into effect by the FSC.

(2) Basis of Preparation

The consolidated financial statements have been prepared on the historical cost basis except for financial instruments which are measured at fair value and net defined benefit liabilities which are measured at the present value of the defined benefit obligations less the fair value of the plan assets. The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to which the fair value measurement inputs are observable and based on the significance of the inputs to the fair value measurement in its entirety, are described as follows:

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

  • B. Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

  • C. Level 3 inputs are unobservable inputs for the 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.

139

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 Tables 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.

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. For the purpose of presenting consolidated financial statements, the assets and liabilities of the Company’s foreign operations (including those subsidiaries, associates and joint ventures in other countries or currencies used different with the company) are translated into New Taiwan dollars using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period. Exchange differences arising, if any, are recognized in other comprehensive income and attributed to stockholders of the parent and noncontrolling 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. The cost of the prepayments for contracts was evaluated base on each contract. 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 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.

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.

140

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 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 Group's share of losses in an associate or a joint venture equals or exceeds its interest in that associate and joint venture (which includes any carrying amount of the investment accounted for using the equity method and long-term interests that, in substance, form part of the Group’s net investment in the associate and joint venture), the Group discontinues recognizing its share of further losses. Additional losses and liabilities are recognized only to the extent that the Group has incurred legal obligations, or constructive obligations, or made payments on behalf of that associate and joint venture.

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 initially measured at cost, and subsequently measured at cost less accumulated depreciation and accumulated impairment loss

Depreciation on property, plant and equipment 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.

On derecognition of an item of property, plant and equipment, the difference between the net disposal proceeds and the carrying amount of the asset 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 are expected to benefit from the synergies of the business combination.

A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that the unit may be impaired, by comparing its carrying amount, including the attributed goodwill, with its recoverable amount. However, if the goodwill allocated to a cash-generating unit was acquired in a business combination during the current annual period, that unit shall be tested for impairment before the end of the current annual period. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata 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

141

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

  • B. Derecognition

    • On derecognition of an intangible asset, the difference between the net disposal proceeds

    • and the carrying amount of the asset is recognized in profit or loss.

  • (11) Impairment of property, plant and equipment, right-of-use assets ,intangible assets (excluding 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. The Group assets are allocated to the smallest group of cash-generating units on a reasonable and consistent basis of allocation.

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 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 on 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 when the Group becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issuance 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

Financial assets are classified as at FVTPL when the financial asset is mandatorily classified as at FVTPL. Financial assets mandatorily classified as at FVTPL include investments in debt instruments that do not meet the amortized cost criteria or the FVTOCI criteria.

Financial assets at FVTPL are subsequently measured at fair value, and any dividends or interest earned on such financial assets are recognized in other income and interest income, respectively; any remeasurement gains or losses on such financial assets are recognized in other gains or losses. Fair value is determined in the manner described in Note 26.

  • (b) Financial assets at amortized cost

142

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, debt instruments at amortized cost, notes receivable, accounts receivable, lease receivables, other receivables and refundable deposits, are measured at amortized cost, which equals the gross carrying amount determined using the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of such a financial asset.

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

  • (c) Investments in equity instruments at FVTOCI

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

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

Dividends on these investments in equity instruments are recognized in profit or loss when the Group’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 recognizes a loss allowance for expected credit losses on financial assets at amortized cost (including accounts receivable), lease receivables, as well as contract assets.

The Group always recognizes lifetime Expected Credit Loss (ECL) for accounts receivable, lease receivables and contract assets. For all other financial instruments, the Group recognizes lifetime ECL when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on the financial instrument has not increased significantly since initial recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECL.

Expected credit losses reflect the weighted average of credit losses with the respective risks of default occurring as the weights. Lifetime ECL represent the expected credit losses that will result from all possible default events over the expected life of a financial instrument. In contrast, 12-month ECL represent 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.

c.

The Group recognizes an impairment loss for all financial instruments with a corresponding adjustment to their carrying amount through a loss allowance account. Derecognition of financial assets

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

On derecognition of a financial asset at amortized cost in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss. On derecognition of an investment in an equity instrument at FVTOCI, the cumulative gain or loss that had been recognized in other

143

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 assets transferred or liabilities assumed, is recognized in profit or loss.

(13) Revenue recognition

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

  • A. Revenue from sales

Contract revenue

Contract revenue comes from software and hardware integration services.

As the Group provides software and hardware integration services, customers simultaneously receive and consume the benefits provided by the Group’s performance. The effort of technical personnel and the completion of the equipment are required to perform software and hardware integration services. The Group measures the stage of completion based on the proportion of contract costs incurred on the work performed to date relative to the estimated total costs. Customers paid in installments according to contract. Contract assets are recognized over the period in which the services are performed and are reclassified to trade receivables at the point at which the customer is invoiced. If the milestone payments exceed the revenue recognized to date, then the Group recognizes contract liabilities for the difference.

When it is probable that total contract costs will exceed the total contract revenue, the expected loss is recognized as an expense immediately

Revenue from the sale of goods

Revenue from the sale of goods comes from sales of computer software, hardware and peripherals. The Group recognizes revenue and accounts receivable when performance obligations are satisfied. The performance obligations are satisfied when customers obtain control and right of use of the promised goods and bear inventory risks.

  • B. Revenue from the rendering of services

Revenue from the rendering of services comes from follow-up maintenance services of software and hardware during the contract period. The Group recognizes 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 finance leases, the lease payments comprise fixed payments. The net investment in a lease is measured at (a) the present value of the sum of the lease payments receivable by a lessor and any unguaranteed residual value accrued to the lessor plus (b) initial direct costs and is presented as a finance lease receivable. Finance lease income is allocated to the relevant accounting periods so as to reflect a constant, periodic rate of return on the Group’s net investment outstanding in respect of leases.

Lease payments from operating leases are recognized as income on a straight-line basis over the terms of the relevant leases.

  • B. The Group as lessee.

The Group recognizes right-of-use assets and lease liabilities for all leases at the commencement date of a lease, except for short-term leases and low-value asset leases accounted for applying a recognition exemption where lease payments are recognized as expenses on a straight-line basis over the lease terms.

Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease liabilities adjusted for lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs needed to restore the underlying assets,

144

and less any lease incentives received. 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 consolidated balance sheets. Right-of-use assets are depreciated using the straight-line method from the commencement dates to the earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.

Lease liabilities are initially measured at the present value of the lease payments, which 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 consolidated balance sheets.

(15) Government Grants

Government grants are not recognized until there is reasonable assurance that the Group will comply with the conditions attached to them and that the grants will be received.

Government grants are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Group should purchase, construct or otherwise acquire non-current assets are recognized as deferred revenue and transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.

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

(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 net interest on the net defined benefit liability (asset) are recognized as employee benefit expenses in the period in which they occur. Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling, and the return on plan assets (excluding interest), is recognized in other comprehensive income in the period in which it occurs. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss. Net defined benefit 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

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

According to the Income Tax Act in the ROC, an additional tax on unappropriated earnings is provided for in the year the 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 and the corresponding tax bases used in the computation of taxable profit.

145

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

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates and interests in joint arrangements, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognized to the extent that it is probable that there will be sufficient taxable profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the 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 liabilities are settled or the assets are realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

  • 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.

  1. 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 about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates.

When developing material accounting estimates, the Group considers the possible impact on the cash flow projection, growth rates, discount rates, profit abilities and other relevant material estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Critical Accounting Judgments Timing of recognition of revenue

For every contract, the Group determines whether its performance obligation is satisfied over time or at a point in time based on the conditions in the contract and applicable regulation.

The Group generates revenue through rendering of software and hardware integration services according to contract. The effort of technical personnel and the completion of the equipment are required to perform software and hardware integration services. The Group measures the stage of completion based on the proportion of contract costs incurred on the work performed to date relative to the estimated total contract costs. Customers paid in installments according to contract. Contract assets are recognized over the period in which the services are performed. Contract revenue is recognized by reference to the stage of completion of each contract. The Group estimated total contract cost upon signing the contract. If the estimated cost changes, the Group amends the percentage of completion and the related contract revenue.

6. Cash and cash equivalents

Cash and cash equivalents
Cash on hand
Checking accounts and demand deposits
Cash equivalents (investments with
original maturities of less than 3
months)
Time deposits
Commercial papers		 December 31, 2023
$ 701
504,127
75,627

304,039		 December 31, 2022


$ 707
297,539
71,704
230,991

146

December 31, 2023
$ 884,494		 December 31, 2022 December 31, 2022
$ 600,941

The market rate ranges of bank deposits, time deposits and commercial papers with original maturities of less than 3 months at the balance sheet date were as follows:

of less than 3 months at the balance sheet date were as follows: of less than 3 months at the balance sheet date were as follows:
7.
8.		 December 31, 2023
Bank demand deposits
0.01%~0.60%
Time deposits with original maturities of
less than 3 months
Time deposits
0.80%~4.70%
Commercial papers
0.93%~0.95%
Financial assets at fair value through profit or loss
December 31, 2023
Financial assets mandatorily classified as
at FVTPL
Non-derivative financial assets
- Fund beneficial certificates
$ 10,457
Financial assets at fair value through other comprehensive income
December 31, 2023
Investments in equity instruments-non-
current
Domestic investments
Listed shares
$ 31,431
Unlisted shares

1,595
$ 33,026		 December 31, 2022
0.01%~0.46%
0.125%~3.69%
0.66%~0.80%
December 31, 2022
$ 19,956
December 31, 2022

Investments in equity instruments-non-
current
Domestic investments
Listed shares
Unlisted shares




$ 24,142
1,595
$ 25,737

These investments in equity instruments are not held for trading. Instead, they are held for medium to long-term strategic purposes. Accordingly, the management elected to designate these investments in equity instruments as at FVTOCI as they believe that recognizing short-term fluctuations in these investments’ fair value in profit or loss would not be consistent with the Group’s strategy of holding these investments for long-term purposes.

The Group purchased the common stocks of Turn Cloud Technology Service Inc. in January 2020, which was designated as investment at FVTOCI 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. Since September 14, 2023, the company has obtained approval from the Taipei Exchange for the over-the-counter trading of its stocks on the securities market.

  1. Financial assets at amortized cost
Financial assets at amortized cost
Pledged time deposits
Time deposits with original maturities of
more than 3 months
Current
Non-current
Total		 December 31, 2023
$ 326,433

87,047
$ 413,480
$ 215,604

197,876
$ 413,480		 December 31, 2022










$ 231,060
100,856
$ 331,916
$ 202,721
129,195
$ 331,916

The ranges of interest rates for time deposits with original maturities of more than 3 months were approximately 0.75%-1.54% and 0.51%-1.40% per annum as of December 31, 2023 and 2022, respectively. Refer to Note 28 for information relating to financial assets at amortized cost pledged as security. Based on the Group’s assessment, the credit risk of the above-mentioned financial assets at amortized cost is not expected to be high and has not increased since initial recognition. The Group does not expect to recognize any credit loss resulting from default events on financial assets at amortized cost that are

147

possible within 12 months after the reporting date. Accordingly, no impairment loss was recognized as of December 31, 2023 and 2022.

10.

Accounts receivable

Accounts receivable
At amortized cost
Accounts receivable
Less: Allowance for impairment loss		 December 31, 2023
$ 1,433,941
(
8,243)
$ 1,425,698		 December 31, 2022

(
(
 $ 1,490,655
1,483)
$ 1,489,172

The average credit period of sales of goods was 60 to 120 days. No interest was charged on accounts receivable.

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

The Group measures the loss allowance for all accounts receivable at an amount equal to lifetime ECLs. The expected credit losses on accounts receivable are estimated by reference to past default experience of the debtor, an analysis of the debtor’s current financial position, past experience with collecting payments, observable changes in national or local economic conditions that correlate with defaults on receivables, as well as indicators of the industry in which the debtors operate.

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

Considering the above conditions, the Group assesses the credit risk of individual customers based on the aging schedule of accounts receivable (based on invoice date). The following table details the loss allowance of accounts receivable.

December 31, 2023

December 31, 2023
Gross carrying amount

Loss allowance (Lifetime ECL)
Amortized cost

December 31, 2022
Gross carrying amount

Loss allowance (Lifetime ECL)
Amortized cost
 Less than
60 Days		 61 to 90
Days		 91 to120
Days		 Over 121
Days		 Total

(
 $ 1,218,276

85)

$ 1,218,191

Less than
60 Days
(
 $ 64,330

408)

$ 63,922

61 to 90
Days
(
 $ 9,306

1,506)

$ 7,800

91 to120
Days
(
 $ 142,029

6,244)

$ 135,785

Over 121
Days
(
 $ 1,433,941

8,243)
$ 1,425,698
Total


$ 1,231,408
-

$ 1,231,408

$ 157,786
-

$ 157,786

$ 22,655
-

$ 22,655
(
 $ 78,806

1,483)

$ 77,323

(
 $ 1,490,655

1,483)
$ 1,489,172

The movements of the loss allowance of accounts receivable were as follows:

2023 2022
Balance at January 1 $ 1,483 $ 1,460
Impairment loss provided for the year 6,760 5
Foreign exchange gains and losses - 18
Balance at December 31 $ 8,243 $ 1,483
Inventories
December 31, 2023 December 31, 2022
Commodities $ 205,958 $ 220,735
Prepayments for contracts 261,488 226,770
Inventories in transit 5,397 5,862

148

Maintenance materials
Total		 December 31, 2023

750
$ 473,593		 December 31, 2022 December 31, 2022


630
$ 453,997

The commodities mainly consisted of computer hardware and software. Prepayment for contracts are the cost incurred to date related to computer hardware, software and labor.

The cost of inventories recognized as cost of goods sold for the years ended December 31, 2023 and 2022 was $3,679,377 thousand and $3,447,531 thousand, respectively. The cost of goods sold included inventory write-downs of $165 thousand and $167 thousand, respectively.

12. Subsidiaries

  • (1) Subsidiaries included in the consolidated financial statements he consolidated entities were as follows:
Investor
The Company






Coach Technology
Management Inc.

Casemaker Inc. and
SYSCOM INTERNA-
TIONAL INC.

 Investee
Casemaker Inc.

SYSCOM INTERNATIONAL
INC.(SYSCOM)

Coach Technology Management Inc.

Syscom Computer(Thailand)Co., Ltd.

Wisemaker Technology Co.

Netmaker Technology Co., Ltd.

Syscom Computer(Thailand)Co., Ltd.

Syscom Computer(Shenzhen)Co.,
Ltd.(Shenzhen)

Xian Linan Computer Co., Ltd.(Xian
Linan )
 Nature of
Activities
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.		 ProportionofOwnership (%)
December 31,
2023
December 31,
2022
100.00%
100.00%
100.00%
100.00%
97.50%
97.50%
92.47%
91.40%
99.24%
98.72%
86.60%
86.60%
0.54%
0.54%
98.27%
98.27%
74.38%
74.38%		 Description
December 31,
2023
100.00%
100.00%
97.50%
92.47%
99.24%
86.60%
0.54%
98.27%
74.38%
A
A
A
A、C
A、B
A
A
A
A

  • A. The amounts presented in the consolidated financial statements, except for SYSCOM, Shenzhen and Xian Linan, which were audited by CPA, are recognized based on the financial statements of each subsidiary audited by other auditors for the same period.

  • B. In January、February and August 2023, the Company acquired additional 14 thousand shares of Wisemaker Technology Co. from an unrelated party for $494 thousand; after the acquisition of further interests, the Company’s percentage of ownership in Wisemaker Technology Co. increased to 99.24%.

  • C. In June and July 2023, the Company acquired additional 40 thousand shares of Syscom Computer (Thailand) Co.,Ltd. from an unrelated party for $108 thousand; after the acquisition of further interests, the Company’s percentage of ownership in Syscom Computer (Thailand) Co.,Ltd. increased to 92.47%.

  • (2) Subsidiaries excluded from 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
Investments in associates		 December 31, 2023
$ 12,432

55,426
$ 67,858
December 31, 2023		 December 31, 2022
$ 15,486

54,032
$ 69,518
December 31, 2022

(1) Investments in associates

Associates that is not individually materiality Unlisted companies

149

DBMaker Japan Inc. December 31, 2023
$ 12,432		 December 31, 2022 December 31, 2022
$ 15,486
As at the end of the reporting period, the proportions of ownership and voting rights in associates As at the end of the reporting period, the proportions of ownership and voting rights in associates As at the end of the reporting period, the proportions of ownership and voting rights in associates
held by the Group were as follows:
Name of the company December 31, 2023 December 31, 2022
DBMaker Japan Inc. 49.89% 49.89%

The summarized financial information below represents amounts shown in the associates’ financial statements prepared in accordance with IFRSs adjusted by the Group for equity accounting purposes.

The Group’s share of:
Net profit for the year
Other comprehensive income
Total comprehensive income		 2023
$ 2,087 )
967)
$ 3,054		 2022
(
(
(
 $ 3,639
332)
$ 3,307

The investments accounted for using the equity method and the share of profit or loss and other comprehensive income of those investments for the years ended December 31, 2023 and 2022 were calculated based on the financial statements which have not been audited. Management believes there is no material impact on the equity method accounting or the calculation of the share of profit or loss and other comprehensive income from the financial statements of associates which have not been audited.

(2)

Investments in joint ventures

audited.
Investments in joint ventures
Joint ventures of no materiality
individually
Cloudmaster Co., Ltd.		 December 31, 2023
$ 55,426		 December 31, 2022
$ 54,032

At the end of the reporting period, the proportion of ownership and voting rights in jointly controlled entity held by the Group was as follows:

Name of the company
Cloudmaster Co., Ltd.		 December 31, 2023
50.00%		 December 31, 2022
50.00%

The summarized financial information below represents amounts shown in the joint venture’s financial statements prepared in accordance with IFRSs adjusted by the Group for equity accounting purposes.

purposes.
The Group’s share of:
Net profit for the year
Other comprehensive income
Total comprehensive income		 2023
$ 1,564
170)
$ 1,394		 2022

(
(
 $ 1,394
97)
$ 1,297

In March 2013, under the authorization of the Investment Commission of the Ministry of Economic Affairs, the Group incorporated CloudMaster under the joint venture agreement and had 50% of ownership. CloudMaster provides services in information software, data processing and electronic information. Under the joint venture agreement, in the meetings of the board of directors and the shareholders of CloudMaster, majority rule shall prevail. However, the Group’s seat in CloudMaster’s board of director does not exceed half of the board. Besides, under CloudMaster’s policies, significant strategic decisions should be made by unanimous agreement of the shareholders of both entities, and the Group has no right to obtain the variable rewards which is unavailable to CloudMaster’s shareholders and does not have direct ability to affect the rewards from investing in CloudMaster. As a result, the Group has no control over CloudMaster.

150

The investments accounted for using the equity method and the share of profit or loss and other comprehensive income of those investments for the years ended December 31, 2023 and 2022 were based on the joint venture’s financial statements audited by auditors for the same years.

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 Table 4 "Information on Investees".

14. Property, plant and equipment

Property, plant and equipment
Assets used by the Group
Assets leased under operating leases		 December 31, 2023
$ 343,833

18,895
$ 362,728		 December 31, 2022




$ 333,516
23,812
$ 357,328

(1) Assets used by the Group

Cost
Balance at January 1,
2023
Addition
Disposal
Reclassification
Net exchange
difference
Balance at December
31, 2023
Accumulated
depreciation
Balance at January 1,
2023
Disposal
Depreciation expenses
Reclassification
Net exchange
difference
Balance at December
31, 2023
Net at December 31,
2023
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		 Land
$ 122,714
-
-
-

2)

$ 122,712

$ -
-

-
-
-

$ -

$ 122,712

$ 121,490
-
-
-
1,224

$ 122,714

$ -
-

-
-
-

$ -

$ 122,714
 Buildings Maintenance
equipment		 Computer
equipment		 Leasehold
improvements		 Others Total

(









(













 $ 100,521

-
-

-
(
4)

$ 100,517

$ 53.717


-

2,028

-

13)

$ 55,732

$ 44,785

$ 98,096

-

-


-
2,425

$ 100,521

$ 50.251


-

1,928

-
1,538

$ 53,717

$ 46,804
 $ 91,554

18,548
(
9,045 )

6,197

-

$ 107,254

$ 55,913
(
9,045 )

14,430
(
367 )

-

$ 60,931

$ 46,323

$ 89,134

10,406
(
10,419 )

2,433

-

$ 91,554

$ 53,322
(
10,418 )

13,049
(
40 )

-

$ 55,913

$ 35,641
 $ 274,448

31,718
(
30,246 )

618
(
254)

$ 276,284

$ 161,956
(
30,217 )

34,271
(
184 )
(
227)

$ 165,599

$ 110,685

$ 292,799

31,414
(
50,502 )

273

464

$ 274,448

$ 177,991
(
50,502 )

34,052

-

415

$ 161,956

$ 112,492
 $ 107,303

6,805

-

-
(
59)

$ 114,049

$ 100,453

-

3,058

-
(
58)

$ 103,453

$ 10,596

$ 102,592

4,752
(
95 )

-

54

$ 107,303

$ 90,100
(
95 )

10,403

-

45

$ 100,453

$ 6,850
 $ 20,451

2,258
(
1,308 )

-
(
27)

$ 21,374

$ 11,436
(
1,147 )

2,378

-
(
25)

$ 12,642

$ 8,732

$ 19,788

2,431
(
1,938 )

-

170

$ 20,451

$ 10,679
(
1,892 )

2,481

-

168

$ 11,436

$ 9,015
 $ 716,991

59,329
(
40,599 )

6,815
(
346)
$ 742,190
$ 383,475
(
40,409 )

56,165
(
551 )
(
323)
$ 398,357
$ 343,833
$ 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

The above items of property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives as follows:

Buildings

39 to 60 years

151

Maintenance equipment 6 years Computer equipment 3 to 6 years Leasehold improvements 1 to 10 years Others - Office equipment 3 to 8 years -Transportation equipment 5 years

As of December 31, 2023 and 2022, the property, plant and equipment were not pledged as collateral.

  • (2) Assets leased under operating leases
Assets leased under operating leases
Cost
Balance at January 1, 2023
Disposals
Reclassification
Balance at December 31, 2023
Accumulated depreciation and impairment
Balance at January 1, 2023
Disposals
Depreciation expenses
Balance at December 31, 2023
Balance on December 31, 2023, net
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
Balance on December 31, 2022, net		 Machinery equipment

(



(









 $ 30,604

507 )
48
$ 30,145
$ 6,792

507 )
4,965
$ 11,250
$ 18,895
$ 30,406
198
$ 30,604
$ 1,144
5,648
$ 6,792
$ 23,812

Operating leases relate to leases of equipment with lease terms between 1 to 3 years. The lessees do not have bargain purchase options to acquire the assets at the expiry of the lease periods.

The maturity analysis of lease payments receivable under operating lease payments was as follows:

Year 1
Year 2
Year 3		 December 31, 2023
$ 17,029
16,787

12
$ 33,828		 December 31, 2022 December 31, 2022




$ 17,323
16,831

16,740
$ 50,894

The above items of property, plant and equipment leased under operating leases are depreciated on a straight-line basis over 1 to 6 years estimated useful lives.

152

15. Lease agreements

  • (1) Right-of-use assets
se agreements
Right-of-use assets
December 31, 2023
Carrying amount
Buildings
$ 94,888
2023
Addition to right-of-use assets
$ 130,129
Depreciation charge for right-of-use
assets
Buildings
$ 49,495
Lease liabilities
December 31, 2023
Carrying amount of lease liabilities
Current
$ 46,175
Non-current
$ 49,503
The range of discount rate for lease liabilities were as follows:
December 31, 2023
Buildings
0.75%~7.28%		 December 31, 2022
$ 20,655
2022
$ 875
$ 44,091
December 31, 2022
$ 8,513
$ 12,426
December 31, 2022
0.75%~2.61%

  • (2) Lease liabilities

  • (3) Material leasing activities and terms

As lessee, the Group leases buildings for the use as offices and dormitory with lease terms of 2 to 10 years. All lease contracts with lease terms over 5 years specify that lease payments will be adjusted every 5 years on the basis of changes in market rental rates. The Group does not have bargain purchase options to acquire the leasehold buildings at the end of the lease terms.

(4) Other lease information

Lease-out arrangements under operating leases for freehold property, plant, and equipment were set out in Note 14.

set out in Note 14.
Expenses relating to short-term leases
Expenses relating to variable lease
payments not included in the
measurement of lease liabilities
Total cash outflow from leases		 2023
$ 7,784
$ 570
$ 60,230)		 2022


(

(		 $ 5,584
$ 229
$ 52,473)

As lessee, the Group leases certain buildings and leasehold improvements which qualify as shortterm leases. The Group has elected to apply the recognition exemption and thus, did not recognize rightof-use assets and lease liabilities for these leases

16. Intangible assets

2023

gible assets
2023
Balance at January 1, 2023

Additions

Amortization expenses

Net exchange difference

Carrying amounts at December 31,
2023		 Computer software
costs
$ 1,817
588
(
677 )
(
9)

$ 1,719		 Goodwill
$ 593
-
-
-

$ 593		 Total

(
(


(
(
 $ 2,410
588

677 )
9)
$ 2,312

2022

153

Balance at January 1, 2022

Additions

Amortization expenses

Net exchange difference

Carrying amounts 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

Computer software is being depreciated on a straight-line basis and will be amortized over 1 to 10 years.

Borrowings
Unsecured borrowings
- Line of credit borrowings		 December 31, 2023
$ 190,855		 December 31, 2022 December 31, 2022
$ 180,922

The range of interest rates on bank revolving loans was 2.26%- 8.31% and 2.08%-7.08% per annum as of December 31, 2023 and 2022, respectively.

18.

Other payables

Other payables
Payables for salaries or bonus
Payables for value-added tax
Payables for insurance
Payables for pension
Payable for compensation of employees
Payables for annual leave
Others		 December 31, 2023
$ 298,098
43,128
19,569
16,183
10,300
1,529

29,186
$ 417,993		 December 31, 2022




$ 288,394
26,275
18,507
14,858
9,600
2,414
32,249
$ 392,297

19. Retirement benefit plans

(1) Defined contribution plans

The Company, Coach Technology Management Inc., Wisemaker Technology Co., and Netmaker Technology Co., Ltd. of the Group adopted a pension plan under the Labor Pension Act (the “LPA”), which is a state-managed defined contribution plan. Under the LPA, an entity makes monthly contributions to employees’ individual pension accounts at 6% of monthly salaries and wages. (2) Defined benefit plans

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

The amounts included in the balance sheets in respect of the Group’s defined benefit plans were as follows:

as follows:
Present value of defined benefit
obligations
Fair value of plan assets		 December 31, 2023
$ 213,160
(
171,213)		 December 31, 2022

(
(		 $ 210,595
155,937)

154

December 31, 2023
December 31, 2022
Net defined benefit liabilities
$ 41,947
$ 54,658
Movements in net defined benefit liabilities (assets) were as follows:
Present value of
defined benefit
obligations
Fair value of plan
assets
Net defined
benefit liabilities
(assets)
Balance at January 1, 2022
$ 228,161
($ 150,666)
$ 77,495
Current service costs

228
-

228
Net interest expense (income)

1,434
(
938)

496
Recognized in profit or loss

1,662
(
938)

724
Remeasurement
Return on plan assets
(excluding amounts included
in net interest)

-
(
11,582 ) (
11,582 )
Actuarial gains - changes in
financial assumptions
(
8,903 )
-
(
8,903 )
Actuarial losses - experience
adjustments

2,570

-

2,570
Recognized in other
comprehensive income
(
6,333)
(
11,582)
(
17,915)
Contributions from the employer

-
(
5,646)
(
5,646)
Benefits paid
(
12,895)

12,895

-
Balance at December 31, 2022

210,595
(
155,937)

54,658
Current service cost

145
-

145
Interest expense (income)

2,536
(
1,870)

666
Recognized in profit or loss

2,681
(
1,870)

811
Remeasurement
Return on plan assets
(excluding amounts included
in net interest)
$ -
( $ 1,588 ) ( $ 1,588 )
Actuarial losses - changes in
financial assumptions

1,330
-

1,330
Actuarial losses - experience
adjustments

2,958

-

2,958
Recognized in other comprehensive
income

4,288
(
1,588)

2,700
Contributions from the employer

-
(
16,222)
(
16,222)
Benefits paid
(
4,404)

4,404

-
Balance at December 31, 2022
$ 213,160
($ 171,213)
$ 41,947		 December 31, 2022 December 31, 2022 December 31, 2022 December 31, 2022
$ 54,658
Net defined
benefit liabilities
(assets)




















(
(

(
(




(


(

 $ 77,495
228
496
724

11,582 )

8,903 )
2,570
17,915)
5,646)
-
54,658
145
666
811
$ 1,588 )
1,330
2,958
2,700
16,222)
-
$ 41,947

An analysis by function of the amounts recognized in profit or loss in respect of the defined benefit plans is as follows:

plans is as follows:
Operating costs
Operating expenses		 2023
$ 154
657
$ 811		 2022




$ 194
530
$ 724

Through the defined benefit plans under the Labor Standards Law, the Group is exposed to the following risks:

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

155

  • B. Interest rate risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.

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

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

as follows:
Discount rate
Expected rate of salary increase		 December 31, 2023
1.15%~1.20%
2.00%		 December 31, 2022
1.25%~1.40%
2.00%

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

ncrease (decrease) as follows:
Discount rate
0.25% increase
0.25% decrease
Expected rate of salary increase
0.25% increase
0.25% decrease		 December 31, 2023
($ 3,257)
$ 3,342
$ 3,305
($ 3,239)		 December 31, 2022
(


(		 (


(		 $ 3,537)
$ 3,633
$ 3,597
$ 3,519)

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

20.
(1)		 Expected contributions to the plans
for the next year
Average duration of the defined
benefit obligation
Equity
Share capital - ordinary shares
Number of authorized shares (in
thousands)
Amount of authorized shares
Number of issued and fully paid
shares (in thousands)
Amount of issued and fully paid
shares		 December 31, 2023
$ 2,521
6.14Years~9.58Years
December 31, 2023

157,000
$ 1,570,000

100,000
$ 1,000,000		 December 31, 2022 December 31, 2022
$ 2,565
6.71Years~11.80Years
December 31, 2022






157,000
$ 1,570,000
100,000
$ 1,000,000

Fully paid ordinary shares, which have a par value of $10, carry one vote per share and carry a right to dividends.

  • (2) Capital surplus

Such capital surplus arise from the difference between consideration paid or received and the carrying amount of the subsidiaries’ net assets during actual acquisition or disposal under equity transactions and from donated assets.

  • (3) Retained earnings and dividend policy

The shareholders of the Company held their regular meeting on June 13, 2023 and in that meeting, resolved the amendments to the Company’s Articles of Incorporation. Under the dividends policy as set forth in the Articles, where the Company made profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit, unless the legal reserve has reached the Company’s total paid-up capital. The remaining profit shall be set aside or reverse a special reserve in accordance with the laws and regulations, and then any

156

remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan. The board of directors is authorized to adopt a special resolution to distribute dividends and bonuses in cash and a report of such distribution should be submitted in the shareholders’ meeting. However, other additional distribution should be resolved in the shareholders’ meeting for distribution of dividends and bonus to shareholders.

Under the dividends policy as set forth in the Articles before the amendments where the Company made profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit, unless the legal reserve has reached the Company’s total paid-up capital. The remaining profit shall be set aside or reverse a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan, which should be resolved in the shareholders’ meeting for distribution of dividends and bonus to shareholders. For the policies on distribution of employees’ compensation and remuneration of directors, refer to “employee’s compensation and remuneration of directors ” in Note 22,(7).

The Company distributes both cash and share dividends, taking into account its profitability, future capital expenditure requirements and cash position. The distribution of cash dividends should not be less than 10% of the total dividends of the year. The Company may raise the percentage of cash dividend distribution only if the Company’s earnings and cash position are strong.

An appropriation of earnings to the legal reserve shall be made until the legal reserve equals the Company’s paid-in capital. The legal reserve may be used to offset deficits. If the Company has no deficit and the legal reserve has exceeded 25% of the Company’s paid-in capital, the excess may be transferred to capital or distributed in cash.

Pursuant to existing regulations, the Company is required to set aside additional special reserve equivalent to the net debit balance of the other equity interests. Any special reserve appropriated may be reversed to the extent that the net debit balance reverses and is thereafter distributed.

The appropriations of earnings and dividends per share for 2022 and 2021 were approved in the shareholders’ meetings on June 13, 2023 and June 15, 2022, respectively, were as follows:

Legal reserve
Cash dividends
Cash dividends per share (NT$)		 2022
$ 26,506
$ 220,000
$ 2.2		 2021


$ 22,088
$ 190,000
$ 1.9

The appropriation of earnings for 2023 had been proposed by the Company’s board of directors on March 12, 2024. The appropriation and dividends per share were as follows:

Legal reserve
Cash dividends
Cash dividends per share (NT$)		 2023


$ 27,613
$ 240,000
$ 2.4

The above appropriations for cash dividends were resolved by the Company’s board of directors, other additional distribution should be resolved in the shareholders’ meeting to be held on June 12, 2024.

(4)

Special reserve

On the first-time adoption of IFRSs, the Group appropriated for special reserve, the amount that was the same as the cumulative translation differences transferred to retained earnings, which was $17,619 thousand.

157

  • (5) Other equity items A. Exchange differences on translation of financial statements of foreign operations
2023 2022
Balance at January 1 ( $ 10,592 ) ( $ 20,350 )
Exchange differences on
translating the financial
statements of foreign operations 861 9,856
Share from associates and joint
venture accounted for using the
equity method ( 169) ( 98)
Balance at December 31 ($ 9,900) ($ 10,592)
B. Unrealized gain (loss) on financial assets at FVTOCI
2023 2022
Balance at January 1 $ 14,339 $ 13,429
Unrealized (loss) gain - equity
instruments 7,289 910
Balance at December 31 $ 21,628 $ 14,339
(6) Non-controlling interests
2023 2022
Balance at January 1 $ 4,968 $ 10,641
Share of loss for the year ( 1,655 ) ( 5,785 )
Other comprehensive income (loss)
during the year
Exchange differences on
translation of financial
statements of foreign
operations 62 106
Remeasurement on defined
benefit plans 80 41
Effective acquisition of partial
interest in a subsidiary by the
parent company (Note 12) ( 330 ) -
Cash dividends from subsidiaries ( 28) ( 35)
Balance at December 31 $ 3,097 $ 4,968
21. Revenue
2023 2022
Revenue from contracts with customers
Contract revenue and revenue from
sale of goods $ 4,908,493 $ 4,583,448
Revenue from rendering of services 1,457,539 1,349,167
Rental income
Rental income from equipment 17,788 17,909
$ 6,383,820 $ 5,950,524

(1) Contract information Revenue from contracts with customers

Contract revenue comes from rendering of computer software and hardware integration services according to contract, which is recognized by reference to the stage of completion of contract activity. The consideration promised is paid by customers based on the schedule in the contract.

Revenue from the sale of goods is recognized when performance obligations are satisfied. The performance obligations are satisfied when customers obtained control and right of use of the promised good and bear inventory risks.

158

Revenue from rendering of services

Revenue from rendering of services comes from maintenance services. The Group requires partial payments from the customers when the contract is signed. Revenue is recognized on a straight-line basis during the contract period.

  • (2) Contract balances
Contract balances
Accounts receivable (Note 10)
Contract assets
System integration services
Less: Allowance for impairment
loss
Contract assets - current
Contract liabilities
System integration services		 December 31, 2023
$ 1,425,698
$ 483,322

-
$ 483,322
$ 465,330		 December 31, 2022








$ 1,489,172
$ 486,381
-
$ 486,381
$ 238,583

The changes in the balance of contract assets and contract liabilities primarily result from the timing difference between the Group’s performance and the respective customer’s payment. Except for adjustments resulting from the changes in the measure of progress, there was no significant change in the current period.

  • (3) Revenue from contracts with customers 2023
2023
Type of products or services
Contract revenue and revenue
from sale of goods
Revenue from rendering of
services
Rental income


2022
Type of products or services
Contract revenue and revenue
from sale of goods
Revenue from rendering of
services
Rental income

 Reportable segment
Business segments
of the Company
$ 4,664,234
1,429,215

17,730

$ 6,111,179
 Business segments
of the entities
controlled by the
Company
$ 244,259
28,324

58

$ 272,641

Reportable segment		 Total




$ 4,908,493
1,457,539
17,788
$ 6,383,820
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
  1. Net profit (1) Interest income

Bank deposits

2023
$ 10,435		 2022
$ 4,043

159

(2) Other income
2023 2022
Government grants $ 31,192 $ 39,858
Marketing incentive income 13,319 10,563
Rental income 5,973 5,716
Others 3,439 5,957
$ 53,923 $ 62,094
(3) Other gains and losses
2023 2022
Net gain on fair value changes of
financial assets mandatorily
classified as at FVTPL $ 2,309 $ 432
Gain on disposal of property, plant and
equipment 141 382
Net foreign exchange loss ( 1,805 ) ( 10,297 )
Others ( 3,352) ( 13,610)
($ 2,707) ($ 23,093)
(4) Finance costs
2023 2022
Interest on bank loans $ 14,419 $ 6,974
Interest on lease liabilities 2,658 850
Others 3 2
$ 17,080 $ 7,826
(5) Depreciation and amortization
2023 2022
An analysis of depreciation by
function
Operating costs $ 21,907 $ 21,088
Operating expenses 88,718 90,564
$ 110,625 $ 111,652
An analysis of amortization by
function
Operating expenses $ 677 $ 633
(6) Employee benefits expenses
2023 2022
Short-term employee benefits
Salary $ 1,485,919 $ 1,420,176
Labor and health insurance 143,782 135,709
Others 50,278 48,903
1,679,979 1,604,788
Post-employment benefits (Note 19)
Defined contribution plans 62,215 58,386
Defined benefit plans 811 724
63,026 59,110
Total employee benefits
expense $ 1,743,005 $ 1,663,898
An analysis of employee benefits
expense by function
Operating costs $ 638,693 $ 649,936

160

Operating expenses 2023
1,104,312
$ 1,743,005		 2022


1,013,962
$ 1,663,898
  • (7) Employees’ compensation and remuneration of directors

According to the Articles of Incorporation of the Company, the Company accrued employees’ compensation at rates of no less than 3%. The employees’ compensation in the amounts of $10,300 thousand and $9,600 thousand, representing 3.02% and 3.01% of net profit before tax for the years ended December 31, 2023 and 2022, respectively, were approved by the Company’s board of directors on March 12, 2024 and March 17, 2023, respectively. The Company did not accrue remuneration of directors for the years ended December 31, 2023 and 2022.

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

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

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

23. Income tax

  • (1) Major components of tax expense recognized in profit or loss
me tax
Major components of tax expense recognized in profit or loss
2023
Current tax
In respect of the current year
$ 53,400

Income tax on unappropriated
earnings
5
Adjustments for prior years
(
1,632 )
(
Deferred tax
In respect of the current year

1,096

Income tax expense recognized in
profit or loss
$ 52,869

A reconciliation of accounting profit and income tax expense is as follows:
2023
Profit before income tax
$ 329,507

Income tax expense calculated at the
statutory rate
$ 65,758

Nondeductible expenses in
determining taxable income
4,300
Tax-exempt income
(
1,210 )
(
Income tax on unappropriated
earnings
5
Investment tax credit
(
18,476 )
(
Unrecognized deductible temporary
differences
3,747
Unrecognized deductible temporary
differences
377
Adjustments for prior years’ tax
(
1,632)
(
Income tax expense recognized in
profit or loss
$ 52,869

Income tax recognized in other comprehensive income
2023
Deferred tax		 2022
$ 59,734
161

2,072 )
1,888
$ 59,711
2022


(
(
(
 $ 304,656
$ 55,327
1,896

1,021 )
161

9,428 )
7,584
7,264
2,072)
$ 59,711
2022

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

  • (2) Income tax recognized in other comprehensive income

In respect of the current year

161

- Remeasurement of defined
benefit plans		 2023
$ 618)		 2022
( $ 3,543

(3) Deferred tax assets and liabilities The movements of deferred tax assets and deferred tax liabilities are as follows: For the year ended December 31, 2023

For the year ended December 31, 2023
Opening Balance
Deferred income tax assets
Temporary differences
Unrealized write-downs of
inventories
$ 451
Defined benefit obligations

11,281
Others

428
Loss carryforward

1,505

$ 13,665

Deferred income tax liabilities
Temporary differences
Unappropriated earnings of
subsidiaries and associates
( $ 10,416 )
Others
(
714)

($ 11,130)

For the year ended December 31, 2022
Opening Balance
Deferred income tax assets
Temporary differences
Unrealized write-downs of
inventories
$ 1,623
Defined benefit obligations

15,754
Others

427
Loss carryforward

1,400

$ 19,204

Deferred income tax liabilities
Temporary differences
Unappropriated earnings of
subsidiaries and associates
( $ 10,578 )
Others
(
660)

($ 11,238)
 Recognized in
profit or loss
$ 33
(
2,981 )

1,478
(
327)

($ 1,797)

$ 802
(
101)

$ 701

Recognized in
profit or loss
( $ 1,172 )
(
930 )

1

105

($ 1,996)

$ 162
(
54)

$ 108








Deferred income tax assets
Temporary differences
Unrealized write-downs of
inventories
Defined benefit obligations

Others

Loss carryforward


Deferred income tax liabilities
Temporary differences
Unappropriated earnings of
subsidiaries and associates
Others
  • (4) Deductible temporary differences for which no deferred tax assets have been recognized in the balance sheets
balance sheets
Deductible temporary differences December31,2023
$ 335		 December31,2022
$ 335

(5) Income tax assessment The Company's and subsidiaries’ income tax returns have been assessed by the tax authorities as follows:

follows:
Name ofthe company
The Company
Netmaker Technology Co., Ltd.
Wisemaker Technology Co.
Coach Technology Management Inc.		 Yearofassessment
2021
2021
2021
2021

162

24. Earnings per share

The earnings and weighted average number of ordinary shares outstanding in the computation of earnings per share were as follows: Net profit for the year

2023 2022 Earnings used in the computation of basic earnings per share $ 278,293 $ 250,730 Earnings used in the computation of diluted earnings per share $ 278,293 $ 250,730

Shares

Shares
Weighted average number of ordinary
shares used in the computation of basic
earnings per share
Effect of potentially dilutive ordinary
shares:
Employees’ compensation
Weighted average number of ordinary
shares used in the computation of
diluted earnings per share		 2023
100,000
222
100,222		 (Thousands shares)
2022


100,000
447
100,447

Since the Group offered to settle compensation paid to employees in cash or shares, the Group assumed the entire amount of the compensation will be settled in shares and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year

25. Capital management

The Group manages its capital to ensure that the Group will be able to continue as going concerns while maximizing the return to shareholders through the optimization of the debt and equity balance. The Group’s overall strategy remains unchanged from 2013.

The capital structure of the Group consists of net debt (borrowings offset by cash and cash equivalents) and equity attributable to owners of the Group (comprising issued capital, reserves, retained earnings, other equity and non-controlling interest).

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

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

26. Financial instruments

  • (1) Fair value of financial instruments not measured at fair value

The Group’s management believes the carrying amounts of financial assets and financial liabilities recognized in the financial statements approximate their fair values. Therefore, the carrying amounts of balance sheet is a reasonable basis for estimating the fair value.

  • (2) Fair value of financial instruments that are measured at fair value on a recurring basis Fair value hierarchy December 31, 2023
Fair value hierarchy
December 31, 2023
Financial assets at FVTPL
Fund beneficial certificates
 Level 1 Level 2
$ -
 Level 3

$ -
 Total
$ 10,457
$ 10,457

163

Financial assets at FVTOCI
Investments in equity instruments at
FVTOCI
- Listed shares

- Unlisted shares

Total

December 31, 2022
Financial assets at FVTPL
Fund beneficial certificates

Financial assets at FVTOCI
Investments in equity instruments at
FVTOCI
- Listed shares

- Unlisted shares

Total
 Level 1
$ 31,431
-

$ 31,431

Level 1
$ 19,956

$ 24,142
-

$ 24,142
 Level 2
$ -
-

$ -

Level 2
$ -

$ -
-

$ -
 Level 3


$ -
1,595

$ 1,595

Level3

$ -




$ -
1,595

$ 1,595
Total










$ 31,431
1,595
$ 33,026
Total
















$ 19,956
$ 24,142
1,595
$ 25,737

There were no transfers between Level 1 and Level 2 f in the current and prior periods.

  • (3) Categories of financial instruments
Categories of financial instruments
Financial assets
Mandatorily classified as at FVTPL
Financial assets at amortized cost
(Note 1)
Financial assets at FVTOCI
Equity instruments
Financial liabilities
Financial liabilities at amortized cost
(Note 2)		 December 31, 2023
$ 10,457
2,742,050
33,026
2,062,512		 December 31, 2022
$ 19,956
2,430,681
25,737
1,989,268

Note 1: The balances include financial assets measured at amortized cost, which comprise cash and cash equivalents, debt investments, notes receivable, accounts receivable and other receivables.

Note 2: The balances include financial liabilities measured at amortized cost, which comprise shortterm loans, notes payable, accounts payable and other payables.

  • (4) Financial risk management objectives and policies

The Group's major financial instruments include equity and debt investments, accounts receivable, accounts payable and lease liabilities. The Company’s Corporate Treasury function provides services to the business, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Company through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk (including currency risk and interest rate risk), credit risk and liquidity risk.

A. Market risk

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

  • a. Foreign currency risk

The Group have foreign currency sales and purchases, which exposes the Group to foreign currency risk.

The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are set out in Note 30. Sensitivity analysis

The Group is mainly exposed to USD.

164

The following details the Group’s sensitivity to a 10% increase and decrease in New Taiwan dollars (the functional currency) against the relevant foreign currencies. The sensitivity rate of 10% used when reporting foreign currency risk internally to key management personnel and representing management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis included only outstanding foreign currency denominated monetary items and foreign currency forward contracts designated as cash flow hedges and adjusts their translation at the end of the reporting period for a 10% change in foreign currency rates. For the years ended December 31, 2023 and 2022, there would be an increase of $7,678 thousand and $9,995 thousand, respectively, in pre-tax profit associated with New Taiwan dollars strengthen 10% against USD. For a 10% weakening of New Taiwan dollars against USD, there would be an equal and opposite impact on pre-tax profit and the balances would be negative. The effect of exchange rate changes was mainly attributable to the exposure outstanding on USD cash, payables and borrowings, which were not hedged at the end of the reporting period.

  • b. Interest rate risk

The Group is exposed to interest rate risk because the Group borrow funds at both fixed and floating interest rates. The risk is managed by the Group by maintaining an appropriate mix of fixed and floating rate borrowings.

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

Fair value interest rate risk
- Financial assets
- Financial liabilities
Cash flow interest rate risk
- Financial assets
- Financial liabilities		 December 31, 2023
$ 786,099
95,678
506,639
190,855		 December 31, 2022
$ 633,596
45,439
293,368
156,422

Sensitivity analysis

The sensitivity analysis below was determined based on the Group’s exposure to interest rates for non-derivative instruments at the end of the reporting period. For floating rate liabilities, the analysis was prepared assuming the amount of each liability outstanding at the end of the reporting period was outstanding for the whole year. A 25 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

If interest rates had been 1 basis points higher/lower and all other variables were held constant, the Group’s pre-tax profit for the years ended December 31, 2023 and 2022 would increase/decrease by $789 thousand and $342 thousand, respectively.

B. Credit risk

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

The Group adopted a policy of only dealing with creditworthy counterparties. Before trading with new customers, the Group assessed the credit quality of potential customer by internal credit checking and set the credit limit which is reassessed annually.

  • C. Liquidity risk

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

165

The Group relies on bank borrowings as a significant source of liquidity. As of December 31, 2023 and 2022, the Group had available unutilized short-term bank loan facilities set out in b. below.

  • a. Liquidity and interest risk rate table for non-derivative financial liabilities The following table details the Group’s remaining contractual maturity for its non-

  • derivative financial liabilities with agreed repayment periods. The table has been drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Group can be required to pay. The table included both interest and principal cash flows. Specifically, bank loans with a repayment on demand clause were included in the earliest time band regardless of the probability of the banks choosing to exercise their rights. The maturity dates for other non-derivative financial liabilities were based on the agreed repayment dates. December 31, 2023

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 $
-		 $ 1,870,360 $ - $
-		 $ -
Lease liabilities 4,208 8,360 35,575 50,404 -
Variable interest rate
liabilities 26,664 53,049
115,673
 -
 -
$
30,872		 $ 1,931,769
$ 151,248
 $
50,404
$ -

Further information about the maturity analysis		 for lease liabilities was as follows:
Less than 1 year 1 to 5 years 5 to 10 years
Lease liabilities $ 48,143
 $ 50,404 $ -
December 31, 2022
On Demand or Less
than
1 Month 1～3 months 3 months～1year 1～5years Morethan5 years
Non-derivative financial
liabilities
Non-interest bearing
 $
-		 $
1,807,257		 $ - $
-		 $ -
Lease liabilities
 836 1,672 6,497 12,714 -
Variable interest rate
liabilities
 810 84,349 74,291 - -
Fixed interest rate liabilities 6,541 18,051
 -
-
 -
$
8,187		 $
1,911,329
$ 80,788
 $
12,714
$ -
Further information about the maturity analysis for lease liabilities was as follows:
Less than 1 year 1 to 5 years 5 to 10 years
Lease liabilities $ 9,005
 $ 12,714 $ -

The amounts included above for variable interest rate instruments for both nonderivative financial assets and liabilities is subject to change if changes in variable interest rates differ from those estimates of interest rates determined at the end of the reporting period.

  • b. Financing facilities
Financing facilities
Unsecured bank financing
facilities, reviewed annually
and payable on demand:
- Amount used
- Amount unused		 December 31, 2023
$ 918,091

1,874,583
$ 2,792,674		 December 31, 2022
$ 610,515

1,685,614
$ 2,296,129
$ 610,515
1,685,614
$ 2,296,129
  1. Related Party Transactions

Transactions and balances between the Company and its subsidiaries, which were related parties of the Company, had been eliminated on consolidation and are not disclosed in this note. Besides as disclosed elsewhere in the other notes, details of transactions between the Group and other related parties were disclosed below.

166

==> picture [455 x 345] intentionally omitted <==

----- Start of picture text -----

(1) Related-party and its relationship
Related party Relationship
Furly Investment Co., Ltd.(Furly Substantive related party
Investment)
Chuan Gao Investment Co., Ltd.(Chuan Gao Substantive related party
Investment)
Welida Investment Co., Ltd. Substantive related party
DBMaker Japan Inc. Associate
Cloudmaster Co., Ltd. Joint venture
(2) Operating revenue (sales, maintenance and rental revenue)
Related Party Categories 2023 2022
Associate $ 42,266 $ 23,658
Joint venture 1,131 143
$ 43,397 $ 23,801
(3) Operating costs (including sales, maintenance and rental)
Related Party Categories 2023 2022
Associate $ 2,797 $ 9,580
Joint venture 4 2,669
$ 2,801 $ 12,249
(4) Receivables from related parties (excluding loans to related parties)
Line Item Related Party Categories December 31, 2023 December 31, 2022
Accounts receivable Associate $ 15,160 $ 2,798
[Joint venture] 247 72
$ 15,407 $ 2,870
----- End of picture text -----

The outstanding accounts receivable from related parties are unsecured. For the years ended December 31, 2023 and 2022, no impairment loss was recognized on accounts receivable from related parties.

(5) Payables to related parties (excluding loans from related parties)
Line Item
Related Party Categories
December 31, 2023
Accounts payable
Associate

$ 1,206

Joint venture

1,500

Substantive related party


9

$ 2,715		 December 31, 2022 December 31, 2022


$ 2,151
1,473
10
$ 3,634

The outstanding accounts payable from related parties are unsecured.

  • (6) Acquisition of property, plant and equipment
(6) Acquisition of property, plant and equipment Acquisition of property, plant and equipment
(7) Related Party Categories
Associate

Lease agreement
Related Party
Categories/Name
Acquisition of right-
of-use assets
Substantive related party
Chuan Gao Investment
Furly Investment		 Purchase Price
2023
$ 4,295
2023
$ 68,488

51,843
$ 120,331		 2022
Associate
Lease agreement
Acquisition of right-
of-use assets

 $ $ 7,660
2022
Substantive related party
Chuan Gao Investment
Furly Investment

$ 68,488
51,843
$ 120,331

$ -
-
$ -

167

(8)
(9)
(10)		 Line Item
Related Party Categories /Name December 31, 2023
Lease liabilities
Substantive related party
Chuan Gao Investment

$ 50,483

Furly Investment


34,923


$ 85,406

Line Item
Related Party Categories /Name
2023
Finance costs
Substantive related party
Chuan Gao Investment

$ 1,252

Furly Investment


895


$ 2,147

Rental expenses
Line Item
Related Party Categories/Name
2023
Operating
Substantive related party
expenses
Chuan Gao Investment

$ 1,338

Furly Investment

4,880

others


-


$ 6,218

Rental revenue
Line Item
Related Party Categories/Name
2023
Other income
Joint venture

Cloudmaster Co., Ltd.

$ 1,779

Compensation of key management personnel
2023
Short-term employee benefits
$ 341,483
Post-employment benefits

13,009
$ 354,492		 Line Item
Related Party Categories /Name December 31, 2023
Lease liabilities
Substantive related party
Chuan Gao Investment

$ 50,483

Furly Investment


34,923


$ 85,406

Line Item
Related Party Categories /Name
2023
Finance costs
Substantive related party
Chuan Gao Investment

$ 1,252

Furly Investment


895


$ 2,147

Rental expenses
Line Item
Related Party Categories/Name
2023
Operating
Substantive related party
expenses
Chuan Gao Investment

$ 1,338

Furly Investment

4,880

others


-


$ 6,218

Rental revenue
Line Item
Related Party Categories/Name
2023
Other income
Joint venture

Cloudmaster Co., Ltd.

$ 1,779

Compensation of key management personnel
2023
Short-term employee benefits
$ 341,483
Post-employment benefits

13,009
$ 354,492		 December 31, 2022 December 31, 2022 December 31, 2022


$ 5,758
-
$ 5,758
2022


$ 237
106
$ 343
2022


$ 1,601
2,709
72
$ 4,382
2022
$ 1,685
2022


$ 305,374
12,268
$ 317,642

The remuneration of directors and key executives was determined by the remuneration committee based on the performance of individuals and market trends.

  1. Assets Pledged as Collateral

The assets pledged as collaterals for system design contract, bank loans and for product warranty were as follows:

Assets Pledged as Collateral
The assets pledged as collaterals for system
were as follows:		 design contract, bank loans and for product warranty for product warranty
Pledge deposits (classified as financial
assets at amortized cost)		 December 31, 2023
$ 326,433		 December 31, 2022
$ 231,060
  1. Significant Contingent Liabilities and Unrecognized Commitments

As of December 31, 2023, for the contracts with customers and the application for government grants, the Group issued guarantee notes and had bank guarantee amounting to $106,767 thousand and $727,236 thousand, respectively.

  1. Significant Assets and Liabilities Denominated in Foreign Currencies

The Group’s significant financial assets and liabilities denominated in foreign currencies aggregated by the foreign currencies other than functional currencies and the related exchange rates between foreign currencies and respective functional currencies were as follows December 31, 2023

Foreign Currencies Exchange rate Carrying amount Financial assets Monetary item USD $ 3,090 30.705 $ 94,864

168

Non-monetary item
JPY
Financial liabilities
Monetary item
USD
December 31, 2022
Financial assets
Monetary item
USD
Non-monetary item
JPY
Financial liabilities
Monetary item
USD		 Foreign Currencies
57,237
5,590
Foreign Currencies
$ 3,012
66,636
6,266		 Exchange rate
0.2172
30.705
Exchange rate
30.71
0.2324
30.71		 Carrying amount
12,432
171,642
Carrying amount
$ 92,484
15,486
192,435

The significant realized and unrealized foreign exchange gains (losses) were as follows:

Foreign currency
USD

USD
 2023 Net Foreign
Exchange
Gain
(Loss)
$ 1,270
(
3,530 )		 2022
Exchange rate
31.155(USD: NTD)

7.0423(USD: RMB)
 Exchange rate
29.805(USD: NTD)

6.7208(USD: RMB)
 Net Foreign
Exchange
Gain
(Loss)
$ 1,789
(
11,877 )

  1. Separately Disclosed Items

  2. (1) Information on significant transactions

    • A. Financing provided to others: None.

    • B. Endorsements/guarantees provided (Table 1).

    • C. Marketable securities held (excluding investment in subsidiaries, associates and joint ventures) (Table 2).

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

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

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

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

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

    • I. Trading in derivative instruments: None.

    • J. Other: Intercompany relationships and significant intercompany transactions: (Table 3).

  3. (2) Information on investees: (Table 4).

  4. (3) Information on investments in Mainland China:

    • A. Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, investment income or loss, carrying amount of the investment at the end of the period, repatriations of investment income, and limit on the amount of investment in the mainland China area: (Table 5)

169

  • B. Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses: None

    • a. The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period.

    • b. The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period.

    • c. The amount of property transactions and the amount of the resultant gains or losses.

    • d. The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes.

    • e. The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds.

    • f. Other transactions that have a material effect on the profit or loss for the year or on the financial position, such as the rendering or receipt of services.

  • (4) Information of major shareholders: list all shareholders with ownership of 5% or greater showing the name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder:(Table 6).

32. Segment Information

Information reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided. The Group’s reportable segments were the operating segments of the Company and the entities controlled by the Company.

  • (1) Segment revenue and results
Reportable segment
Business segments of
the Company

Business segments of
the entities
controlled by the
Company

Elimination of inter-
segment revenue

Total of reportable
segments

Non-operating income and
expense
Net profit before tax		 Segment r eve nue
2022
$ 5,674,679

360,533

84,688)

$ 5,950,524


 Segment profit Segment profit or loss
2023
$ 6,115,419

318,885

50,484)

$ 6,383,820
 2023

$ 298,837


15,771 )
2,393

285,459

44,048

$ 329,507
 2022

(
(
(
(


 $ 291,698

30,128 )
2,835
264,405
40,251
$ 304,656

Segment revenue reported above represents revenue generated from external customers and intersegment 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, 2023
$ 4,484,930

361,340
$ 4,846,270
$ 2,474,375

254,591
$ 2,728,966		 December 31, 2022





$ 4,025,953
408,987
$ 4,434,940
$ 2,097,252
282,875
$ 2,380,127

170

(3) Geographical information The Group operates principally mainly in four regions - Taiwan, China, the U.S.A. and Southeast Asia.

The Groups’ revenue from external customers and information about its non-current assets by geographical location are detailed below:

Taiwan

China

U.S.A.

Southeast Asia

 Revenue from external customers
2023
2022

$ 6,216,988
$ 5,799,879

155,413

139,888

8,070
7,517
3,349

3,240

$ 6,383,820
$ 5,950,524
 Revenue from external customers
2023
2022

$ 6,216,988
$ 5,799,879

155,413

139,888

8,070
7,517
3,349

3,240

$ 6,383,820
$ 5,950,524
 Non-current assets Non-current assets Non-current assets
2023
$ 6,216,988

155,413

8,070
3,349

$ 6,383,820
 December 31, 2023
$ 485,160


12,224

20,308

1,223

$ 518,915
December 31, 2022
















$ 394,083
15,698
21,038
1,257
$ 432,076

Non-current assets exclude financial instruments, deferred tax assets, and post-employment benefit assets.

(4) Information of major customers

Revenue from system design, integration and maintenance in 2023 and 2022: $6,383,820 thousand and $5,950,524 thousand, where $1,024,743 thousand and $892,328 thousand were from the largest customer of the Group.

171

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Endorsements/Guarantees Provided For the Year Ended December 31, 2023

Table1 (In Thousands ofNewTaiwan Dollars/ForeignCurrency) (In Thousands ofNewTaiwan Dollars/ForeignCurrency) (In Thousands ofNewTaiwan Dollars/ForeignCurrency) (In Thousands ofNewTaiwan Dollars/ForeignCurrency) (In Thousands ofNewTaiwan Dollars/ForeignCurrency)
No. Endorser/
Guarantor		 Endorsee/
Guarantee		 Limits on
Endorsement/
Guarantee Given
on Behalf of
Each Party		 Maximum Amount
Endorsed/
Guaranteed During
the Period		 Outstanding
Endorsement/
Guarantee at the End
of the Period (Note 1)		 Actual Borrowing
Amount		 Amount Endorsed/
Guaranteed by
Collateral		 Ratio of
Accumulated
Endorsement
/Guarantee to
Net Equity in
Latest Financial
Statements
(%)
Aggregate
Endorsement/
Guarantee Limit		 Endorsement
/Guarantee
Given by
Parent on
Behalf of
Subsidiaries		 Endorsement
/Guarantee
Given by
Subsidiaries on
Behalf of
Parent
Endorsement
/Guarantee
Given on
Behalf of
Companies in
Mainland
China
Name Relationship
0 Syscom
Computer
Engineering
Co.		 Syscom Computer (Shenzhen)
Co., Ltd.
Xian Linan Computer Co.,
Ltd.
Netmaker Technology Co.,
Ltd.
Coach Technology
Management Inc.
Indirect
subsidiary
Indirect
subsidiary
Subsidiaries
Subsidiaries		 20% of the net
worth
$422,841
Same as above
Same as above
Same as above		 $ 334,685
( USD
10,900 )
60,642
( USD
1,975 )
85,000
15,000		 $ 282,486
( USD
9,200 )
40,684
( USD
1,325 )
85,000
15,000		 $ 153,125
( USD
4,987 )
29,947
( USD
975 )
7,500
-		 $ -
-
-
-		 13.36
1.92
4.02
0.71		 50% of the net worth
$1,057,104
Same as above
Same as above
Same as above		 Yes
Yes
Yes
Yes		 No
No
No
No		 Yes
Yes
No
No

Note:The above amounts were translated into New Taiwan dollar at the prevailing exchange rate as of December 31, 2023.

172

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Marketable securities held December 31, 2023

Table 2

(In Thousands of New Taiwan Dollars and in thousands of Shares (Thousands of Units))

Holding Company Name Type and name of marketable securities Relationship with the Holding
Company		 Financial Statement Account December 31, 2023 December 31, 2023 Note
Number of
shares/units		 Carrying amount Percentage of
Ownership (%)		 Fair value
SYSCOM COMPUTER
ENGINEERING CO.
Coach Technology Management Inc.		 Beneficial certificates
Yuanta Japan Leaders Equity Fund
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		 1,000
273
195
166
2
31
$ 10,000

1,595

29,898

1,470

63

457		 -
9.09
0.90
-
-
-		 $ 10,000
1,595
29,898
1,470
63
457

Note 1: The securities referred to in this table include stocks, bonds, mutual funds and securities derived from the above - mentioned items within the scope of International Financial Reporting Standard No. 9 “Financial Instruments”. Note 2: The above shares or certificates were not provided as guarantee.

173

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES

Intercompany Relationships and Significant Intercompany Transactions and Subsidiary and Between Subsidiaries For the Year Ended December 31, 2023

Table 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		 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.
Coach Technology Management Inc.		 1
1
1
1
1
1
1
1
1
1
1		 Account receivable
Prepayment for purchases
Sales revenue
Maintenance revenue
Cost of goods sold
Maintenance costs
Accounts payable
Rental income
Cost of goods sold
Maintenance costs
Miscellaneous expenses		 $ 1,226
1,513
1,669
2,297
6,089
7,020
5,802
1,132
29,024
9,707
1,046		 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 to subsidiary.

174

Table 4

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Information on investees For the Year Ended December 31, 2023

(In Thousands of New Taiwan Dollars/Thousands of Shares)

Investor Company Investee Company Location Main Businesses and Products Original investment amount Original investment amount Holdingat the end of theperiod Holdingat the end of theperiod Holdingat the end of theperiod Net Income (Loss) of the
Investee		 Share of Profit (Loss) Note
December 31, 2023 December 31, 2022 Number of
Shares
(Thousands)		 Percentage of
Ownership		 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
42,191
JPY
53,260
THB
33,134
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
2,679
5
3,440
6,500
20		 97.50
100.00
100.00
86.60
99.24
49.89
92.47
50.00
0.54		 $ 6,550
96,751
( 94,834 )
35,643
60,187
12,432
3,004
55,426
17		 $ 2,276
(
1,922 )
(
25,160 )
(
4,752 )

4,003
(
4,184 )
(
178 )

3,128
(
178 )
 $ 2,219
(
1,922 )
(
25,160 )
(
4,115 )

3,982
(
2,087 )
(
165 )

1,564
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 foreign currency amount of the net income of the investee is expressed in New Taiwan dollars at the average exchange rate in 2023.

175

SYSCOM COMPUTER ENGINEERING CO. AND SUBSIDIARIES Information on investments in Mainland China For the Year Ended December 31, 2023

For the Year Ended December For the Year Ended December 31, 2023
Table 5 (In Thousands of New Taiwan Dollars/Foreign Currency)
Investee Company Main Businesses and
Products		 Paid-in capital Method of
Investment		 Accumulated Outward
Remittance for
Investment from
Taiwan as of
January 1, 2023		 Remittance of Funds Accumulated Outward
Remittance for
Investment from
Taiwan as of
December 31, 2023		 Net Income (Loss) of
the Investee		 % Ownership of
Direct or
Indirect
Investmen		 Investment Gain
(Loss)		 Carrying Amount as of
December 31, 2023
Accumulated
Repatriation of
Investment Income as
of December 31, 2023		 Note
Outward Inward
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
manufacture of
computer equipment
and computer
software; sale of self-
manufactured
products and
provision of technical
services.
$ 138,173
(
USD
4,500 )

70,622
( USD
2,300 )		 Note 1
Note 1		 $ 128,040
( USD
4,170 )
46,610
( USD
1,518 )		 $ -
-		 $ -
-		 $ 128,040
( USD
4,170 )
46,610
( USD
1,518 )		 ( $ 25,361 )
( (USD
814 ))
(Note 2)
(
2,513 )
( (USD
81 ))
(Note 2)		 98.27%
74.38%		 ( $ 24,922 )
( (USD
800 ))
(Note 2)
(
1,869 )
( (USD
60 ))
(Note 2)		 ( $ 96,311 )
( (USD
3,137 ))
(Note 2)
(
4,532 )
( (USD
148 ))
(Note 2)		 $ -
-

Accumulated Outward Remittance for Investment in Upper Limit on the Amount of Investment Stipulated by Mainland China as of Investment Amounts Authorized by Investment Investment Commission, MOEA Commission, MOEA December 31, 2023 (Note 3) $ 174,650 $ 174,650 ( USD 5,688 ) ( USD 5,688 ) (Note 1(2)) $ 1,268,524 13,394 ( USD 436 ) (Note 1(1))

Note 1: Investment methods are classified into the following two categories:

(1) An investee of CASEMaker, Inc., a wholly owned subsidiary of Syscom Computer Engineering Company and capital increase from capital surplus.

(2) An investee of Syscom International Inc., a wholly owned subsidiary of Syscom Computer Engineering Company.

Note 2: Amount was recognized based on the financial statements which were audited by CPAs on December 31, 2023.

Note 3: According to the "Principles for the Review of Investment or Technical Cooperation in the Mainland Area" stipulated by the Investment Commission of the Ministry of Economic Affairs (MOEAIC), the upper limit is calculated as follows: 60% of the shareholders ’ equity = $2,114,207 × 60% = $1,268,524

Note 4: The foreign currency amounts of original investment amount and carrying value are expressed in New Taiwan dollars at exchange rate as of December 31, 2023. The foreign currency amount of net income is expressed in New Taiwan dollars at average exchange rate for the year ended December 31, 2023.

176

SYSCOM COMPUTER ENGINEERING CO. Information on major shareholders December 31, 2023

Table 6

Table 6
Name of major shareholder Shareholding
Number of shares held Shareholding
percentage
Jui-Fu Liu
Chi-Shan Liu
Su-Chen Yang		 18,346,787
7,598,911
7,256,001		 18.34%
7.59%
7.25%

Note: The information of major shareholders presented in this table is provided by the Taiwan Depository & Clearing Corporation based on the number of ordinary shares and preferred shares held by shareholders with ownership of 5% or greater, that have been issued without physical registration (including treasury shares) by the Corporation as of the last business day for the current quarter. The share capital in the parent company only financial statements may differ from the actual number of shares that have been issued without physical registration because of different preparation basis.

177

  • 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 “Company”), which comprise the balance sheets as of December 31, 2023 and 2022, 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 Company as of December 31, 2023 and 2022, 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 Company in accordance with The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. 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, 2023. 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 Company for the year ended December 31, 2023 are stated as follows:

Recognition of Contract Revenue

The Company 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

178

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, 2023 and 2022 of some investees in which the Company 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, 2023 and 2022, the aforementioned investments accounted for using equity method amounted to NT$202,135 thousands and NT$203,541 thousands, which were 4% and 5% of total assets of the Company. For the years ended December 31, 2023 and 2022, investment loss from the aforementioned equity-method investments amounted to NT$1 thousands and NT$2,371 thousands, which represented 0% and (0.8%) of the profit before income tax of the Company.

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 Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including the Audit Committee, are responsible for overseeing the Company’s financial reporting process.

179

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 Company’s internal control.

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

  4. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the 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 Company 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 Company 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.

180

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

The engagement partners on the audit resulting in this independent auditors’ report are Li-Wen Kuo and Pei-De Chen.

Deloitte & Touche Taipei, Taiwan Republic of China

March 12, 2024

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.

181

SYSCOM COMPUTER ENGINEERING CO.

BALANCE SHEETS

DECEMBER 31, 2023 AND 2022

(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, and 25)
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, 2023 December 31, 2023
％
16
-
4
10
-
28
-
10
9
2
79
1
4
6
7
2
-
-
1
21
100
10
-
31
9
-
1
-
51
-
1
1
-
2
4
55
21
-
7
1
16
24
-
45
100		 December 31, 2022 December 31, 2022
Amount
$ 732,897
10,000
184,678
471,815
8,831
1,336,959
5,578
456,133
411,779
88,970
3,707,640
33,026
197,630
269,993
336,501
81,661
392
9,606
53,655
982,464
$ 4,690,104
$ 455,424
131
1,443,177
397,340
17,509
41,048
17,379
2,372,008
9,614
41,490
43,419
14,532
94,834
203,889
2,575,897
1,000,000
1,797
330,483
17,619
752,580
1,100,682
11,728
2,114,207
$ 4,690,104		 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		 ％








































































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

The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 12, 2024)

182

SYSCOM COMPUTER ENGINEERING CO.

STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31,2023 AND 2022

(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		 2023 ％
76

24
-

100

58
17
-

75

25

17
3
-

20

5

-
1

-


-

-

1
 2022
Amount
$ 4,666,572
1,431,116
17,731

6,115,419

3,531,049
1,019,247
14,185

4,564,481

1,550,938

1,047,139
204,962
-

1,252,101

298,837

7,535
52,367
856

2,810 )
25,684)

32,264
 Amount
％
$ 4,328,914
76
1,327,885
24
17,880

-
5,674,679
100
3,280,653
58
962,166
17
14,457

-
4,257,276

75
1,417,403

25
936,247
17
189,458
3
-

-
1,125,705

20
291,698

5
2,904
-
60,806
1

9,085 )
-

313 )
-
36,358)
(1 )
17,954

-
(Continued)		 ％









(
(





























(
(
(









(

183

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
 2023 ％
6

1

5


-
-
-

-

-
-

-

5


 2022
Amount
$ 331,101
52,808

278,293


4,059 )
7,289
1,085
812
861

169)

5,819

$ 284,112

$ 2.78
$ 2.78		 Amount
$ 309,652
58,922

250,730

17,235
910
543

3,447 )
9,855

97)

24,999

$ 275,729

$ 2.51
$ 2.50		 ％



(
(








(
(




5
1
4
1
-
-

-
-
-
1
5

The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 12, 2024)

(Concluded)

184

SYSCOM COMPUTER ENGINEERING CO.

STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED DECEMBER 31,2023 AND 2022

(In Thousands of New Taiwan Dollars, except Dividend Per Share)

Co d e
A1
BALANCE AT JANUARY 1, 2022
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
Appropriation of the 2022 earnings
B1
Legal reserve
B5
Cash dividends - NT$2.2 per share
D1
Net profit for the year ended December 31, 2023
D3
Other comprehensive income (loss) for the year ended
December 31, 2023, net of income tax
D5
Total comprehensive income (loss) for the year ended
December 31, 2023
C3
Unclaimed dividends
M5
Actual acquisition of interests in subsidiaries
Z1
BALANCE AT DECEMBER 31, 2023		 Share capital -
ordinary shares
$ 1,000,000
-
-
-

-

-
1,000,000
-
-
-

-

-
-

-
$ 1,000,000		 Capital surplus
$ 1,547
-
-
-
-
-
1,547
-
-
-
-
-
522
272)
$ 1,797		 Retained earnings Unappropriated
earnings
$ 669,982
(
22,088 )
(
190,000 )
250,730

14,331

265,061
722,955
(
26,506 )
(
220,000 )
278,293
(
2,162)

276,131
-

-
$ 752,580		 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
( $ 20,350 )
$ 13,429
-
-
-
-
-
-

9,758

910

9,758

910
(
10,592 )
14,339
-
-
-
-
-
-

692

7,289

692

7,289
-
-

-

-
($ 9,900)
$ 21,628		 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
( $ 20,350 )
$ 13,429
-
-
-
-
-
-

9,758

910

9,758

910
(
10,592 )
14,339
-
-
-
-
-
-

692

7,289

692

7,289
-
-

-

-
($ 9,900)
$ 21,628		 Total equity
Exchange differences
on translating the
financial statements of
foreign operations
( $ 20,350 )
-
-
-

9,758

9,758
(
10,592 )
-
-
-

692

692
-

-
($ 9,900)
Legal reserve
$ 281,889
22,088
-
-
-
-
303,977
26,506
-
-
-
-
-
-
$ 330,483		 Special reserve
$ 17,619
-
-
-

-

-
17,619
-
-
-

-

-
-

-
$ 17,619











(












(
(


(
(
(


 (


(



(






(


(


(
 $ 1,964,116
-

190,000 )
250,730
24,999
275,729
2,049,845
-

220,000 )
278,293
5,819
284,112
522
272)
$ 2,114,207

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

(With Deloitte & Touche auditors’ report dated March 12, 2024)

185

SYSCOM COMPUTER ENGINEERING CO.

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31,2023 AND 2022

(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
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
A23700
Write-downs of inventories
A24100
Net loss 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 generated from operations
A33100
Interest received
A33200
Dividends received
A33300
Interest paid

A33500
Income tax paid

AAAA
Net cash generated from operating
activities		 2023
$ 331,101

100,349
100

2,300 )

2,810

7,535 )


586 )

25,684

164 )

165

390
6,590


6,532 )
57,541

475 )

42,341 )


35,757 )

1,171

234,557

15,895 )
52,253
31,216
3,362

15,143)

720,561
7,535
586

2,810 )

63,596)

662,276
 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
(Continued)

(
(
(
(

(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(
(

186

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
Decrease(Increase) in refundable deposits
B07600
Dividends from subsidiaries received

BBBB
Net cash (used in) generated 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

C09900
Unclaimed dividends

CCCC
Net cash used in 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		 2023
$ -


89,097 )

10,000 )

21,805

59,092 )

324
21,563

2,942

111,555)


2,759 )

41,341 )


220,000 )


602 )
522

264,180)

268

286,809
446,088

$ 732,897
 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

The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 12, 2024)

(Concluded)

187

SYSCOM COMPUTER ENGINEERING CO. Notes to Parent Company Only Financial Statements Years Ended December 31, 2023 and 2022

(Amounts in thousands of NTD, unless stated otherwise)

  1. General

SYSCOM COMPUTER ENGINEERING CO. (the " Company") was incorporated in July 1975. The Company mainly leases and sells computer systems and designs computer software. It also provides services for the integration of computer information systems and maintenances of computer hardware. The Company's shares have been listed on the Taiwan Stock Exchange since May 22, 2001.

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

  1. The Date and Procedures of Authorization of Financial Statements

The financial statements were approved by the Board of Directors on March 12, 2024.

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

Except for the following, the initial application of the IFRS Accounting Standards endorsed and issued into effect by the FSC did not have material impact on the Company’s accounting policies: Amendments to IAS 1 “Disclosure of Accounting Policies”

When applying the amendments, the Company refers to the definition of material to determine its material accounting policy information to be disclosed. Accounting policy information is material if it can reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements. Moreover:

  • Accounting policy information that relates to immaterial transactions, other events or conditions is immaterial and need not be disclosed;

  • The Company may consider the accounting policy information material because of the nature of the related transactions, other events or conditions, even if the amounts are immaterial; and

  • Not all accounting policy information relating to material transactions, other events or conditions is itself material.

The accounting policy information is likely to be considered material to the financial statements if that information relates to material transactions, other events or conditions and:

  • A. The Company changed its accounting policy during the reporting period and this change resulted in a material change to the information in the financial statements;

  • B. The Company chose the accounting policy from options permitted by the standards;

  • C. The accounting policy was developed in accordance with IAS 8 “Accounting Policies, Changes in Accounting Estimates and Errors” in the absence of an IFRS that specifically applies;

  • D. The accounting policy relates to an area for which the Company is required to make significant judgments or assumptions in applying an accounting policy, and the Company discloses those judgments or assumptions; or

  • E. The accounting is complex, and users of the financial statements would otherwise not understand those material transactions, other events or conditions.

Refer to Note 4 for related accounting policy information.

(2) The IFRS Accounting Standards endorsed by the FSC for application starting from 2024.
New/Amended/Revised Standards andInterpretations
Effective Date
Announced byIASB(Note1)
Amendments to IFRS 16 “Leases Liability in a Sale and
Leaseback”
January 1, 2024 (Note 2)
Amendments to IAS 1 “Classification of Liabilities as Current or
Non-current”
January 1, 2024
Amendments to IAS 1 “Non-current Liabilities with Covenants” January 1, 2024
Amendments to IAS 7 and IFRS 7 “Supplier Finance
Arrangements”
January 1, 2024 (Note 3)		 The IFRS Accounting Standards endorsed by the FSC for application starting from 2024.
New/Amended/Revised Standards andInterpretations
Effective Date
Announced byIASB(Note1)
Amendments to IFRS 16 “Leases Liability in a Sale and
Leaseback”
January 1, 2024 (Note 2)
Amendments to IAS 1 “Classification of Liabilities as Current or
Non-current”
January 1, 2024
Amendments to IAS 1 “Non-current Liabilities with Covenants” January 1, 2024
Amendments to IAS 7 and IFRS 7 “Supplier Finance
Arrangements”
January 1, 2024 (Note 3)
January 1, 2024 (Note 2)
January 1, 2024
January 1, 2024
January 1, 2024 (Note 3)

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

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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. Note 3: The amendments provide some transition relief regarding disclosure requirements. As of the date the consolidated financial statements were authorized for issue, the Company has assessed that the application of other standards and interpretations will not have a material impact on the Company’s financial position and financial performance.

  • (3) IFRSs issued by the IASB but not yet endorsed and issued into effect by the FSC

Effective Date Announced by New/Amended/Revised Standards and Interpretations the IASB (Note 1) Amendments to IFRS 10 and IAS 28 “Sale or Contribution of To be determined by IASB Assets between an Investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” January 1, 2023 Amendments to IFRS 17 January 1, 2023 Amendments to IFRS 17 “Initial Application of IFRS 9 and January 1, 2023 IFRS 17 - Comparative Information” Amendments to IAS 21 “Lack of Exchangeability” January 1, 2025 (Note 2)

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

Note 2: An entity shall apply those amendments for annual reporting periods beginning on or after January 1, 2025. Upon initial application of the amendments, the entity recognizes any effect as an adjustment to the opening balance of retained earnings. When the entity uses a presentation currency other than its functional currency, it shall, at the date of initial application, recognize any effect as an adjustment to the cumulative amount of translation differences in equity.

As of the date the Company’s consolidated financial statements were authorized for issue, the Company is continuously assessing the possible impact of the application of other standards and interpretations on the Company’s financial position and financial performance and will disclose the relevant impact when the assessment is complete.

  1. Summary of Significant Accounting Policies (1) Statement of Compliance

The financial statements have been prepared in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

  • (2) Basis of Preparation

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

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

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

  • B. Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

  • C. Level 3 inputs are unobservable inputs for the 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.

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  • (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.

  • (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. The cost of the prepayments for contracts was evaluated base on each contract. 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 that is controlled by the Company.

Under the equity method, the investment in subsidiaries is initially recognized at cost and the increase or decrease of carrying amount reflects the recognition of the Company’s share of profit or loss and other comprehensive income of the subsidiaries after the date of acquisition. Besides, the Company also recognizes the Company’s share of the change in other equity of the subsidiaries.

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

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

Any excess of the cost of acquisition over the Company’s share of the net fair value of the identifiable assets and liabilities of a subsidiary 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 the net fair value of the identifiable assets and liabilities over the cost of acquisition is recognized immediately in profit or loss.

The Company assesses its investment for any impairment by comparing the carrying amount with the estimated recoverable amount as assessed based on the investee’s financial statements as a whole. Impairment loss is recognized when the carrying amount exceeds the recoverable amount. If the recoverable amount of the investment subsequently increases, the Company recognizes a reversal of the impairment loss; the adjusted post-reversal carrying amount should not exceed the carrying amount that would have been recognized (net of amortization or depreciation) had no impairment loss been recognized in prior years. An impairment loss recognized on goodwill cannot be reversed in a subsequent period.

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When the Company loses control of a subsidiary, it recognizes the investment retained in the former subsidiary at its fair value at the date when control is lost. The difference between the fair value of the retained investment plus any consideration received and the carrying amount of the previous investment at the date when control is lost is recognized as a gain or loss in profit or loss. Besides, the Company accounts for all amounts previously recognized in other comprehensive income in relation to that subsidiary on the same basis as would be required if the Company had directly disposed of the related assets or liabilities

Profits or losses resulting from downstream transactions are eliminated in full only in the parent company’s financial statements. Profits and losses resulting from upstream transactions and transactions between subsidiaries are recognized only in the parent company’s financial statements only to the extent of interests in the subsidiaries of parties that are not related to the Company.

(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 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 of an associate and a joint venture equals or exceeds its interest in that associate and joint venture (which includes any carrying amount of the investment accounted for using the equity method and long-term interests that, in substance, form part of the Company’s net investment in the associate and joint venture), the Company discontinues recognizing its share of further losses. Additional losses and liabilities are recognized only to the extent that the Company has incurred legal obligations, or constructive obligations, or made payments on behalf of that associate and joint venture.

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 initially measured at cost, and subsequently measured at cost less accumulated depreciation and accumulated impairment loss.

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Depreciation on property, plant and equipment 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.

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

  • (9) Intangible assets

  • A. Acquired separately

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

B. Derecognition

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

  • (10) Impairment of property, plant and equipment, right-of-use assets, intangible assets (excluding goodwill) and incremental costs of obtaining contracts

At the end of each reporting period, the Company 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 an 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 Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Company assets are allocated to the smallest group of cash-generating units on a reasonable and consistent basis of allocation.

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 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 on the asset or cash-generating unit in prior years. A reversal of an impairment loss is recognized in profit or loss.

(11) Financial instruments

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

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issuance 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

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

Financial assets are classified as at FVTPL when the financial asset is mandatorily classified as at FVTPL. Financial assets mandatorily classified as at FVTPL include

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investments in debt instruments that do not meet the amortized cost criteria or the FVTOCI criteria.

Financial assets at FVTPL are subsequently measured at fair value, and any dividends or interest earned on such financial assets are recognized in other income and interest income, respectively; any remeasurement gains or losses on such financial assets are recognized in other gains or losses. Fair value is determined in the manner described in Note 24.

  • (b)Financial assets at amortized cost

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

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

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

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, debt instruments at amortized cost, notes receivable, accounts receivable, other receivables and refundable deposits, are measured at amortized cost, which equals the gross carrying amount determined using the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of such a financial asset.

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

  • (c) Investments in equity instruments at FVTOCI

On initial recognition, the Company may make an irrevocable election to designate investments in equity instruments as at FVOCI. Designation at FVOCI 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, it will be transferred to retained earnings.

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

b.

Impairment of financial assets and contract assets

The Company recognizes a loss allowance for expected credit losses on financial assets at amortized cost (including accounts receivable), lease receivables, as well as contract assets.

The Company always recognizes lifetime Expected Credit Loss (ECL) for accounts receivable, lease receivables and contract assets. For all other financial instruments, the Company recognizes lifetime ECL when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on the financial instrument has not increased significantly since initial recognition, the Company measures the loss allowance for that financial instrument at an amount equal to 12-month ECL.

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

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

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  • c. Derecognition 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 entity.

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 measured 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 assets transferred or liabilities assumed, is recognized in profit or loss.

(12) Revenue recognition

The Company identifies the performance obligations in the contract with the customers, allocates transaction price to each performance obligation and recognizes revenue when performance obligations are satisfied.

  • A. Revenue from sales

Contract revenue

Contract revenue comes from software and hardware integration services.

As the Company provides software and hardware integration services, customers simultaneously receive and consume the benefits provided by the Company’s performance. The effort of technical personnel and the completion of the equipment are required to perform software and hardware integration services. The Company measures the stage of completion based on the proportion of contract costs incurred on the work performed to date relative to the estimated total costs. Customers paid in installments according to contract. Contract assets are recognized over the period in which the services are performed and are reclassified to trade receivables at the point at which the customer is invoiced. If the milestone payments exceed the revenue recognized to date, then the Company recognizes contract liabilities for the difference. When it is probable that total contract costs will exceed the total contract revenue, the expected loss is recognized as an expense immediately. Revenue from the sale of goods

Revenue from the sale of goods comes from sales of computer software, hardware and peripherals. The Company recognizes revenue and accounts receivable when performance obligations are satisfied. The performance obligations are satisfied when customers obtain control and right of use of the promised goods and bear inventory risks.

  • B. Revenue from the rendering of services

Revenue from the rendering of services comes from follow-up maintenance services of software and hardware during the contract period. The Company recognizes 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 finance leases, the lease payments comprise fixed payments. The net investment in a lease is measured at (a) the present value of the sum of the lease payments receivable by a lessor and any unguaranteed residual value accrued to the lessor plus (b) initial direct costs and is presented as a finance lease receivable. Finance lease income is allocated to the relevant accounting periods so as to reflect a constant, periodic rate of return on the Company’s net investment outstanding in respect of leases.

Lease payments from operating leases are recognized as income on a straight-line basis over the terms of the relevant leases.

  • B. The Company as lessee

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The Company recognizes right-of-use assets and lease liabilities for all leases at the commencement date of a lease, except for short-term leases and low-value asset leases accounted for applying a recognition exemption where lease payments are recognized as expenses on a straight-line basis over the lease terms.

Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease liabilities adjusted for lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs needed to restore the underlying assets, and less any lease incentives received. 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 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 balance sheets.

(14) Government Grants

Government grants are not recognized until there is reasonable assurance that the Company will comply with the conditions attached to them and that the grants will be received.

Government grants are recognized in profit or loss on a systematic basis over the periods in which the Company recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Company should purchase, construct or otherwise acquire non-current assets are recognized as deferred revenue and transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.

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

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

Net defined benefit 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

  • Income tax payable (refundable) is based on taxable profit (loss) for the year determined

  • according to the applicable tax laws of each tax jurisdiction.

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

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

  • B. Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences, research and development expenditures and personnel training expenditures to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates and interests in joint arrangements, 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 they are expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the 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 liabilities are settled or the assets are realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the 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.

  1. 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 about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates. When developing material accounting estimates, the Company considers the possible impact on the cash flow projection, growth rates, discount rates, profit abilities and other relevant material estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Critical accounting judgments Timing of recognition of revenue

For every contract, the Company determines whether its performance obligation is satisfied over time or at a point in time based on the conditions in the contract and applicable regulation.

The Company generates revenue through rendering of software and hardware integration services according to contract. The effort of technical personnel and the completion of the equipment are required to perform software and hardware integration services. The Company measures the stage of completion based on the proportion of contract costs incurred on the work performed to date relative to the estimated total contract costs. Customers paid in installments according to contract. Contract assets are recognized over the period in which the services are performed. Contract revenue is recognized by reference to the stage of completion of each contract. The Company estimated total contract cost upon signing the contract. If the estimated cost changes, the Company amends the percentage of completion and the related contract revenue.

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6. Cash and cash equivalents

Cash and cash equivalents
December 31, 2023 December 31, 2022
Cash on hand $ 405 $ 405
Checking accounts and demand deposits 437,531 220,787
Cash equivalents (investments with
original maturities of less than 3
months)
Commercial papers 294,961 224,896
$ 732,897 $ 446,088
The market rate ranges of bank deposits and commercial papers with original maturities of less than 3
months at the balance sheet date were as follows:
months at the balance sheet date were as follows: months at the balance sheet date were as follows:
7.
8.		 December 31, 2023
Bank demand deposits
0.58%
Commercial papers with original
maturities of less than 3 months
0.95%
Financial assets at fair value through profit or loss
December 31, 2023
Financial assets mandatorily classified as
at FVTPL
Non-derivative financial assets
Fund beneficial certificates
$ 10,000
Financial assets at fair value through other comprehensive income
December 31, 2023
Investments in equity instruments-non-
current
Domestic investments
Listed shares
$ 31,431
Unlisted shares

1,595
$ 33,026		 December 31, 2022
0.46%
0.78%~0.80%
December 31, 2022
$ 19,505
December 31, 2022

Investments in equity instruments-non-
current
Domestic investments
Listed shares
Unlisted shares




$ 24,142
1,595
$ 25,737

These investments in equity instruments are not held for trading. Instead, they are held for medium to long-term strategic purposes. Accordingly, the management elected to designate these investments in equity instruments as at FVTOCI as they believe that recognizing short-term fluctuations in these investments’ fair value in profit or loss would not be consistent with the Company’s strategy of holding these investments for long-term purposes.

The Company purchased the common stocks of Turn Cloud Technology Service Inc. in January 2020, which was designated as investment at FVTOCI 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. Since September 14, 2023, the company has obtained approval from the Taipei Exchange for the over-the-counter trading of its stocks on the securities market.

9.

Financial assets at amortized cost

Financial assets at amortized cost
Pledged time deposits
Time deposits with original maturities of
more than 3 months
Current
Non-current
Total		 December 31, 2023
$ 326,187

56,121
$ 382,308
$ 184,678

197,630
$ 382,308		 December 31, 2022










$ 230,417
62,794
$ 293,211
$ 164,382
128,829
$ 293,211

The ranges of interest rates for time deposits with original maturities of more than 3 months were approximately 0.78%-1.54% and 0.76%-1.40% per annum as of December 31, 2023 and 2022, respectively.

197

Refer to Note 26 for information relating to financial assets at amortized cost pledged as security. Based on the Company’s assessment, the credit risk of the above-mentioned financial assets at amortized cost is not expected to be high and has not increased since initial recognition. The Company does not expect to recognize any credit loss resulting from default events on financial assets at amortized cost that are possible within 12 months after the reporting date. Accordingly, no impairment loss was recognized as of December 31, 2023 and 2022.

Accounts receivable

Accounts receivable
At amortized cost
Accounts receivable
Less: Allowance for impairment loss		 December 31, 2023
$ 1,337,728
(
769)
$ 1,336,959		 December 31, 2022

(
(
 $ 1,395,696
769)
$ 1,394,927

The average credit period of sales of goods was 60 to 120 days. No interest was charged on accounts receivable.

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

The Company measures the loss allowance for all accounts receivables at an amount equal to lifetime ECLs. The expected credit losses on accounts receivable are estimated by reference to past default experience of the debtor, an analysis of the debtor’s current financial position, past experience with collecting payments, observable changes in national or local economic conditions that correlate with defaults on receivables, as well as indicators of the industry in which the debtors operate.

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

Considering the above conditions, the Company assesses the credit risk of individual customers based on the aging schedule of accounts receivable (based on invoice date). The following table details the loss allowance of accounts receivable.

December 31, 2023

December 31, 2023
Less than
60 Days
Gross carrying amount
$ 1,139,986
Loss allowance (Lifetime ECL)
-

Amortized cost
$ 1,139,986

December 31, 2022
Less than
60 Days
Gross carrying amount
$ 1,155,380
Loss allowance (Lifetime ECL)
-

Amortized cost
$ 1,155,380

The movements of the loss allowance
Balance at January 1
Impairment loss provided for the year
Balance at December 31		 Less than
60 Days		 61 to 90
Days		 91 to120
Days		 Over 121
Days		 Total


$ 1,139,986

-

$ 1,139,986

Less than
60 Days

$ 58,181

-

$ 58,181

61 to 90
Days

$ 6,481

-

$ 6,481

91 to120
Days
(
 $ 133,080

769)

$ 132,311

Over 121
Days
(
 $ 1,337,728

769)
$ 1,336,959
Total
$ 1,395,696
(
769)
$ 1,394,927
2022


$ 769
-
769
$

198

11.

Inventories

Inventories
Commodities
Prepayments for contracts
Inventories in transit
Maintenance materials
Total		 December 31, 2023
$ 205,959
244,401
5,397

376
$ 456,133		 December 31, 2022




$ 219,550
195,721
5,862
246
$ 421,379

The commodities mainly consisted of computer hardware and software. Prepayment for contracts are the cost incurred to date related to computer hardware, software and labor.

The cost of inventories recognized as cost of goods sold for the years ended December 31, 2023 and 2022 was $3,531,049 thousand and $3,280,653 thousand, respectively. The cost of goods sold included inventory write-downs of $165 thousand and $167 thousand, respectively.

12. Investments accounted for using the equity method

Investments in subsidiaries
Investments in associates
Investments in joint ventures		 December 31, 2023
$ 202,135
12,432

55,426
$ 269,993		 December 31, 2022 December 31, 2022




$ 203,541
15,486
54,032
$ 273,059
  • (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, 2023
$ 96,751
(
94,834 )
60,187
35,643
6,550

3,004
107,301

94,834
$ 202,135		 December 31, 2022

(
(


 $ 98,578

71,381 )
58,256
39,271
4,331
3,105
132,160
71,381
$ 203,541

At the end of the reporting period, the proportions of ownership and voting rights in subsidiaries held by the Company were as follows:

held by the Company were as follows:
Name of the subsidiary
Casemaker Inc.
Wisemaker Technology Co.
SYSCOM INTERNATIONAL
INC.(SYSCOM)
Netmaker Technology Co., Ltd.
Coach Technology Management Inc.
Syscom Computer(Thailand)Co., Ltd.		 Proportion of Ownershipand VotingRights
December 31,2023
100.00%
99.24%
100.00%
86.60%
97.50%
92.47%		 December 31,2022
100.00%
98.72%
100.00%
86.60%
97.50%
91.40%		 Description
(A)
(A)、(B)
(A)
(A)
(A)
(A)、(C)

A. Except for SYSCOM, whose financial statements for the year ended December 31, 2023 and 2022 have been audited by CPA, the investments in subsidiaries accounted for using the equity method and the share of profit or loss and other comprehensive income of those investments for the years ended December 31, 2023 and 2022 were based on the subsidiaries’ financial statements which have been audited by other auditors for the same period.

199

  • B. In January 、 February and August 2023, the Company acquired additional 14 thousand shares of Wisemaker Technology Co. from an unrelated party for $494 thousand; after the acquisition of further interests, the Company’s percentage of ownership in Wisemaker Technology Co. increased to 99.24%.

  • C. In June and July 2023, the Company acquired additional 40 thousand shares of Syscom Computer (Thailand) Co.,Ltd. from an unrelated party for $108 thousand; after the acquisition of further interests, the Company’s percentage of ownership in Syscom Computer (Thailand) Co.,Ltd. increased to 92.47%.

(2) Investments in associates

December 31, 2023 December 31, 2022 Associates that is not individually materiality Unlisted companies DBMaker Japan Inc. $ 12,432 $ 15,486

All the associates were accounted for using the equity method. As at the end of the reporting period, the proportions of ownership and voting rights in associates held by the Company were as follows:

held by the Company were as follows:
Name of the company
DBMaker Japan Inc.		 Proportion of Ownershipand VotingRights
December 31, 2023
49.89%		 December 31, 2022
49.89%

The summarized financial information below represents amounts shown in the associates’ financial statements prepared in accordance with IFRSs adjusted by the Company for equity accounting purposes.

The Company’s share of:
Net profit for the year
Other comprehensive income
Total comprehensive income		 2023
$ 2,087 )
967)
$ 3,054)		 2022
(
(
(		 $ 3,639
(
332)
$ 3,307

The investments accounted for using the equity method and the share of profit or loss and other comprehensive income of those investments for the years ended December 31, 2023 and 2022 were calculated based on the financial statements which have not been audited. Management believes there is no material impact on the equity method accounting or the calculation of the share of profit or loss and other comprehensive income from the financial statements of associates which have not been audited.

(3) Investments in joint ventures

Investments in joint ventures
Joint ventures of no materiality
individually
Cloudmaster Co., Ltd.		 December 31, 2023
$ 55,426		 December 31, 2022
$ 54,032

At the end of the reporting period, the proportion of ownership and voting rights in jointly controlled entity held by the Company was as follows:

Proportion of Ownership and Voting Rights
Name of the company December 31, 2023 December 31, 2022
Cloudmaster Co., Ltd. 50.00% 50.00%
The joint venture is accounted for using the equity method.

The summarized financial information below represents amounts shown in the joint venture’s financial statements prepared in accordance with IFRSs adjusted by the Company for equity accounting purposes.

200

The Company’s share of:
Net profit for the year
Other comprehensive income
Total comprehensive income		 2023
$ 1,564
170)
$ 1,394		 2022

(
(
 $ 1,394
97)
$ 1,297

In March 2013, under the authorization of the Investment Commission of the Ministry of Economic Affairs, the Company incorporated CloudMaster under the joint venture agreement and had 50% of ownership. CloudMaster provides services in information software, data processing and electronic information. Under the joint venture agreement, in the meetings of the board of directors and the shareholders of CloudMaster, majority rule shall prevail. However, the Coompany’s seat in CloudMaster’s board of director does not exceed half of the board. Besides, under CloudMaster’s policies, significant strategic decisions should be made by unanimous agreement of the shareholders of both entities, and the Company has no right to obtain the variable rewards which is unavailable to CloudMaster’s shareholders and does not have direct ability to affect the rewards from investing in CloudMaster. As a result, the Company has no control over CloudMaster.

The investments accounted for using the equity method and the share of profit or loss and other comprehensive income of those investments for the years ended December 31, 2023 and 2022 were based on the joint venture’s financial statements audited by auditors for the same years.

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 Table 3 "Information on Investees".

13. Property, plant and equipment

Property, plant and equipment
Assets used by the Company
Assets leased under operating leases		 December 31, 2023
$ 317,606

18,895
$ 336,501		 December 31, 2022




$ 304,533
23,812
$ 328,345
  • (1) Assets used by the Company
Cost
Balance at January
1, 2023
Addition
Disposal
Reclassification

December 31, 2023
Balance
Accumulated
depreciation
Balance at January
1, 2023
Disposal
Depreciation
expenses
Reclassification

December 31, 2023
Balance
December 31, 2023
Net
Cost
Balance at January
1, 2022
Addition
Disposal
Reclassification

December 31, 2022
Balance
Accumulated
depreciation
Balance at January
1, 2022
Disposal
Depreciation
expenses
Reclassification

December 31, 2022
Balance
December 31, 2022
Net		 Land
$ 110,307
-
-
-

$ 110,307

$ -
-
-
-

$ -

$ 110,307

$ 110,307
-
-
-

$ 110,307

$ -
-
-
-

$ -

$ 110,307
 Buildings
$ 75,940

-

-
-

$ 75,940

$ 37,670

-


1,289
-

$ 38,959

$ 36,981

$ 75,940

-

-
-

$ 75,940

$ 36,381

-


1,289
-

$ 37,670

$ 38,270
 Maintenance
equipment

(



(

(




(



(



 Computer
equipment
$ 246,637

31,481

29,986 )
618

$ 248,750

$ 138,557

29,986 )

32,979

184)

$ 141,366

$ 107,384

$ 262,630

30,285

46,550 )
272

$ 246,637

$ 152,423

46,550 )

32,684
-

$ 138,557

$ 108,080
 Leasehold
improvements
$ 99,939

6,805

-

-

$ 106,744

$ 94,948

-

2,509

-

$ 97,457

$ 9,287

$ 95,186

4,753

-

-

$ 99,939

$ 85,094

-

9,854

-

$ 94,948

$ 4,991
 Others
$ 16,282

2,258

1,307 )
-

$ 17,233

$ 7,770

1,147 )

2,265
-

$ 8,888

$ 8,345

$ 15,832

2,389

1,939 )
-

$ 16,282

$ 7,311

1,892 )

2,351
-

$ 7,770

$ 8,512
 Total




































(



(

(




(



(

(

 $ 90,116

18,548

9,045 )
6,211
$ 105,830
$ 55,743

9,045 )

14,191

361)
$ 60,528
$ 45,302
$ 88,748

9,306

10,419 )
2,481
$ 90,116
$ 53,260

10,419 )

12,929

27)
$ 55,743
$ 34,373






















(



(






(



(

(



(

(




(



(

(

 $ 639,221

59,092

40,338 )
6,829
$ 664,804
$ 334,688

40,178 )

53,233

545)
$ 347,198
$ 317,606
$ 648,643

46,733

58,908 )
2,753
$ 639,221
$ 334,469

58,861 )

59,107

27)
$ 334,688
$ 304,533

201

The above items of property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives as follows:

ul lives as follows:
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

As of December 31, 2023 and 2022, the property, plant and equipment were not pledged as collateral.

  • (2) Assets leased under operating leases
Assets leased under operating leases
Cost
Balance at January 1, 2023
Disposals
Reclassification
Balance at December 31, 2023
Accumulated depreciation and impairment
Balance at January 1, 2023
Disposals
Depreciation expenses
Balance at December 31, 2023
Balance on December 31, 2023, net
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
Balance on December 31, 2022, net		 Machinery equipment
$ 30,604
(
507 )

48
$ 30,145
$ 6,792
(
507 )

4,964
$ 11,250
$ 18,895
$ 30,406

198
$ 30,604
$ 1,144

5,648
$ 6,792
$ 23,812

Operating leases relate to leases of equipment with lease terms between 1 to 3 years. The lessees do not have bargain purchase options to acquire the assets at the expiry of the lease periods. The maturity analysis of lease payments receivable under operating lease payments was as follows:

follows:
Year 1
Year 2
Year 3		 December 31, 2023
$ 17,029
16,787

12
$ 33,828		 December 31, 2022




$ 17,323
16,831
16,740
$ 50,894

The above items of property, plant and equipment leased under operating leases are depreciated on a straight-line basis over 1 to 6 years estimated useful lives.

202

14.
(1)
(2)		 Lease agreements
Right-of-use assets
December 31, 2023
Carrying amount
Buildings
$ 81,661
2023
Addition to right-of-use assets
$ 120,331
Depreciation charge for right-of-use
assets
Buildings
$ 42,151
Lease liabilities
December 31, 2023
Carrying amount of lease liabilities
Current
$ 41,048
Non-current
$ 41,490
The range of discount rate for lease liabilities were as follows:
December 31, 2023
Buildings
1.20%~2.10%		 December 31, 2022 December 31, 2022
$ 3,481
2022
$ -
$ 36,582
December 31, 2022
$ 2,069
$ 1,479
December 31, 2022
1.20%~1.50%
  • (3) Material leasing activities and terms

As lessee, the Company leases buildings for the use as offices and dormitory with lease terms of 2 to 7.3 years. All lease contracts with lease terms over 5 years specify that lease payments will be adjusted every 5 years on the basis of changes in market rental rates. The Company does not have bargain purchase options to acquire the leasehold buildings at the end of the lease terms.

(4) Other lease information Lease-out arrangements under operating leases for freehold property, plant, and equipment were set out in Note 13.

set out in Note 13.
Expenses relating to short-term leases
Total cash outflow from leases		 2023
$ 7,748
$ 51,559)		 2022

(
(		 $ 5,548
$ 44,865)

As lessee, the Company leases certain buildings and leasehold improvements which qualify as short-term leases. The Company has elected to apply the recognition exemption and thus, did not recognize right-of-use assets and lease liabilities for these leases.

15. Intangible assets

Intangible assets

Balance at January 1, 2023

Amortization expenses

Carrying amounts at December 31,
2023



Balance at January 1, 2022

Amortization expenses

Carrying amounts at December 31,
2022

 Computer software
cost

(


(
 $ 492
100)
$ 392
$ 592
100)
$ 492

Computer software is being depreciated on a straight-line basis and will be amortized over 1 to 10 years.

203

As of December 31, 2023 and 2022, the Company had assessed that there was no indication that computer software costs may have been impaired and therefore no impairment assessment was performed.

16. Other payables

Other payables
Payables for salaries or bonus
Payables for value-added tax
Payables for insurance
Payables for pension
Payables for compensation of employees
Payables for annual leave
Others		 December 31, 2023
$ 283,100
42,075
18,872
15,469
10,300
1,505

25,839
$ 397,340		 December 31, 2022




$ 270,900
25,582
17,740
14,293
9,600
2,389
25,620
$ 366,124

17. Retirement benefit plans

(1) Defined contribution plans

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

(2) Defined benefit plans

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

The amounts included in the balance sheets in respect of the Company’s defined benefit plans were as follows:

as follows:
Present value of defined benefit
obligation
Fair value of plan assets
Net defined benefit liabilities		 December 31, 2023
$ 207,129
(
163,710)
$ 43,419		 December 31, 2022

(
(
 $ 202,589
148,086)
$ 54,503

Movements in net defined benefit liabilities (assets) were as follows:

Balance at January 1, 2022

Current service cost

Net interest expense (income)

Recognized in profit or loss

Remeasurement
Return on plan assets (excluding
amounts included in net
interest)
Actuarial gains - changes in
financial assumptions
Actuarial losses - experience
adjustments		 Present value of
defined benefit
obligation
$ 220,060

228

1,377


1,605

-
(
8,420 )

2,239		 Fair value of plan
assets
($ 143,672)

-
(
887)

(
887)

(
11,054 )
-

-		 Net defined benefit
liabilities (assets)		 Net defined benefit
liabilities (assets)



(
 (
(
(
(


(
(
 $ 76,388
228
490
718

11,054 )

8,420 )
2,239

204

Recognized in other comprehensive
income
Contributions from the employer

Benefits paid

Balance at December 31, 2022

Current service cost

Interest expense (income)

Recognized in profit or loss

Remeasurement
Return on plan assets (excluding
amounts included in net
interest)
Actuarial losses - changes in
financial assumptions
Actuarial losses - experience
adjustments
Recognized in other comprehensive
income
Contributions from the employer

Benefits paid

Balance at December 31, 2023
 Present value of
defined benefit
obligation
(
6,181)

-

(
12,895)


202,589

145

2,430


2,575

-
1,266

4,323

5,589

-

(
3,624)

$ 207,129
 Fair value of plan
assets
(
11,054)
(
5,368)


12,895

(
148,086)

-
(
1,763)

(
1,763)

(
1,530 )
-

-
(
1, 530)
(
15,955)


3,624

($ 163,710)
 Net defined benefit
liabilities (assets)		 Net defined benefit
liabilities (assets)
(

(






(
 (
(

(
(
(
(

(
(

(		 (
(




(


(

 17,235)
5,368)
-
54,503
145
667
812

1,530 )
1,266
4,323
4,059
15,955)
-
$ 43,419

An analysis by function of the amounts recognized in profit or loss in respect of the defined benefit plans is as follows:

plans is as follows:
Operating expenses 2023
$ 812		 2022
$ 718

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

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

  • B. Interest rate risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.

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

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

as follows:
Discount rate
Expected rate of salary increase		 December 31, 2023
1.15%
2.00%		 December 31, 2022
1.25%
2.00%

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

ncrease (decrease) as follows:
Discount rate
0.25% increase
0.25% decrease		 December 31, 2023
($ 3,141)
$ 3,222		 December 31, 2022
(
(
$ 3,352)
$ 3,442

205

Expected rate of salary increase
0.25% increase
0.25% decrease		 December 31, 2023
$ 3,187
($ 3,123)		 December 31, 2022 December 31, 2022

(
(		 $ 3,408
$ 3,336)

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


(1)		 Expected contributions to the plans
for the next year
Average duration of the defined
benefit obligation
Equity
Share capital - ordinary shares
Number of authorized shares (in
thousands)
Amount of authorized shares
Number of issued and fully paid
shares (in thousands)
Amount of issued and fully paid
shares		 December 31, 2023
$ 2,314
6.14Years
December 31, 2023

157,000
$ 1,570,000

100,000
$ 1,000,000		 December 31, 2022 December 31, 2022
$ 2,289
6.71Years
December 31, 2022






157,000
$ 1,570,000
100,000
$ 1,000,000

Fully paid ordinary shares, which have a par value of $10, carry one vote per share and carry a right to dividends.

  • (2) Capital surplus

Such capital surplus arise from the difference between consideration paid or received and the carrying amount of the subsidiaries’ net assets during actual acquisition or disposal under equity transactions and from donated assets.

  • (3) Retained earnings and dividends policy

The shareholders of the Company held their regular meeting on June 13, 2023 and in that meeting, resolved the amendments to the Company’s Articles of Incorporation. Under the dividends policy as set forth in the Articles, where the Company made profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit, unless the legal reserve has reached the Company’s total paid-up capital. The remaining profit shall be set aside or reverse a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan. The board of directors is authorized to adopt a special resolution to distribute dividends and bonuses in cash and a report of such distribution should be submitted in the shareholders’ meeting. However, other additional distribution should be resolved in the shareholders’ meeting for distribution of dividends and bonus to shareholders.

Under the dividends policy as set forth in the Articles before the amendments where the Company made profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit, unless the legal reserve has reached the Company’s total paid-up capital. The remaining profit shall be set aside or reverse a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan, which should be resolved in the shareholders’ meeting for distribution of dividends and bonus to shareholders. For the policies on distribution of employees’ compensation and remuneration of directors, refer to “employee’s compensation and remuneration of directors ” in Note 20,(7).

The Company distributes both cash and share dividends, taking into account its profitability, future capital expenditure requirements and cash position. The distribution of cash dividends should not be less than 10% of the total dividends of the year. The Company may raise the percentage of cash dividend distribution only if the Company’s earnings and cash position are strong.

206

An appropriation of earnings to the legal reserve shall be made until the legal reserve equals the Company’s paid-in capital. The legal reserve may be used to offset deficits. If the Company has no deficit and the legal reserve has exceeded 25% of the Company’s paid-in capital, the excess may be transferred to capital or distributed in cash.

Pursuant to existing regulations, the Company is required to set aside additional special reserve equivalent to the net debit balance of the other equity interests. Any special reserve appropriated may be reversed to the extent that the net debit balance reverses and is thereafter distributed.

The appropriations of earnings and dividends per share for 2022 and 2021 were approved in the shareholders’ meetings on June 13, 2023 and June 15, 2022, respectively, were as follows:

Legal reserve
Cash dividends
Cash dividends per share (NT$)		 2022
$ 26,506
$ 220,000
$ 2.2		 2021




$ 22,088
$ 190,000
$ 1.9

The appropriation of earnings for 2023 had been proposed by the Company’s board of directors on March 12, 2024. The appropriation and dividends per share were as follows:

March 12, 2024. The appropriation and dividends per share were as follows:
Legal reserve
Cash dividends
Cash dividends per share (NT$)		 2023


$ 27,613
$ 240,000
$ 2.4

The above appropriations for cash dividends were resolved by the Company’s board of directors, other additional distribution should be resolved in the shareholders’ meeting to be held on June 12, 2024.

(4) Special reserves

On the first-time adoption of IFRSs, the Company appropriated for special reserve, the amount that was the same as the cumulative translation differences transferred to retained earnings, which was $17,619 thousand.

(5) Other equity items

  • A. Exchange differences on translating the financial statements of foreign operations
2023
Balance at January 1
( $ 10,592 )
Exchange differences on translating
the financial statements of foreign
operations
861
Share from subsidiaries, associates
and joint venture accounted for
using the equity method
(
169)
Balance at December 31
($ 9,900)
Unrealized gain (loss) on financial assets at FVTOCI
2023
Balance at January 1
$ 14,339
Unrealized (loss) gain - equity
instruments

7,289
Balance at December 31
$ 21,628		 2022
(
(
(		 $ 20,350 )
9,855
97)
$ 10,592)
2022


$ 13,429
910
$ 14,339
  • B. Unrealized gain (loss) on financial assets at FVTOCI

207

19. Revenue
Revenue from contracts with customers
Contract revenue and revenue from
sale of goods
Revenue from rendering of services
Rental income
Rental income from equipment		 2023
$ 4,666,572
1,431,116
17,731
$ 6,115,419		 2022




$ 4,328,914
1,327,885
17,880
$ 5,674,679
  • (1) Contract information Revenue from contracts with customers

Contract revenue comes from rendering of computer software and hardware integration services according to contract, which is recognized by reference to the stage of completion of contract activity. The consideration promised is paid by customers based on the schedule in the contract. Revenue from the sale of goods is recognized when performance obligations are satisfied. The performance obligations are satisfied when customers obtained control and right of use of the promised good and bear inventory risks.

Revenue from rendering of services

Revenue from rendering of services comes from maintenance services. The Company requires partial payments from the customers when the contract is signed. Revenue is recognized on a straightline basis during the contract period.

  • (2) Contract balances
Contract balances
Accounts receivable (Note 10)
Contract assets
System integration services
Less: Allowance for
impairment loss
Contract assets - current
Contract liabilities
System integration services		 December 31, 2023
$ 1,336,959
$ 471,815

-
$ 471,815
$ 455,424		 December 31, 2022








$ 1,394,927
$ 478,405
-
$ 478,405
$ 220,867

The changes in the balance of contract assets and contract liabilities primarily result from the timing difference between the Company’s performance and the respective customer’s payment. Except for adjustments resulting from the changes in the measure of progress, there was no significant change in the current period.

  1. Net profit

  2. (1) Interest income


Net profit
(1)
Interest income
Bank deposits
(2)
Other income
Government grants
Marketing incentive income
Rental income
Others		 2023
$ 7,535
2023
$ 30,619
13,319
4,692
3,737
$ 52,367		 2022
$ 2,904
2022




$ 39,070
10,563
4,930
6,243
$ 60,806

208

(3)
Other gains and losses
Gain on disposal of property, plant and
equipment
Net gain on fair value changes of
financial assets mandatorily classified
as at FVTPL
Net foreign exchange gain
Others
(4)
Finance costs
Interest on lease liabilities
Interest on bank loans
Others
(5)
Depreciation and amortization
An analysis of depreciation by
function
Operating costs
Operating expenses
An analysis of amortization by
function
Operating expenses
(6)
Employee benefits expenses
Short-term employee benefits
Salary
Labor and health insurance
Others
Post-employment benefits (Note 17)
Defined contribution plans
Defined benefit plans
Total employee benefits
expense
An analysis of employee benefits
expense by function
Operating costs
Operating expenses		 2023
$ 164
2,300
1,303
2,911)
$ 856
2023

2,110
697
3

2,810
2023
20,330
80,019
100,349
100
2023
1,351,135
119,283
48,323
1,518,741
59,895
812
60,707
1,579,448
570,980
1,008,468
1,579,448		 2022

(
(
(		 $ 382
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
$
$
$

(7) Employees’ compensation and remuneration of directors According to the Articles of Incorporation of the Company, the Company accrued employees’ compensation at rates of no less than 3%. The employees’ compensation in the amounts of $10,300

209

thousand and $9,600 thousand, representing 3.02% and 3.01% of net profit before tax for the years ended December 31, 2023 and 2022, respectively, were approved by the Company’s board of directors on March 12, 2024 and March 17, 2023, respectively. The Company did not accrue remuneration of directors for the years ended December 31, 2023 and 2022.

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

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

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

21. Income tax

  • (1) Major components of tax expense recognized in profit or loss
ome tax
Major components of tax expense recognized in profit or loss
2023
Current tax
In respect of the current year
$ 52,393

Adjustments for prior years
(
1,632 )

Deferred tax
In respect of the current year

2,047

Income tax expense recognized in
profit or loss
$ 52,808

A reconciliation of accounting profit and income tax expense is as follows:
2023
Profit before income tax
$ 331,101

Income tax expense calculated at the
statutory rate
$ 66,220

Nondeductible expenses in
determining taxable income
2,937
Tax-exempt income
(
1,208 )
(
Investment tax credits
(
18,475 )
(
Unrecognized deductible temporary
differences
4,966
Adjustments for prior years’ tax
(
1,632)
(
Income tax expense recognized in
profit or loss
$ 52,808
2022
$ 59,006
(
2,023 )
1,939
$ 58,922
2022


(
(
(
 $ 309,652
$ 61,930
1,512

1,031 )

9,428 )
7,962
2,023)
$ 58,922
  • (2) Deferred tax assets and liabilities

The movements of deferred tax assets and deferred tax liabilities are as follows: For the year ended December 31, 2023

Deferred tax assets
Temporary differences
Unrealized write-downs of
inventories
Defined benefit obligations

Others


Deferred tax liabilities
Temporary differences
Unappropriated earnings of
subsidiaries and associates		 Opening Balance Opening Balance Recognized in
profit or loss
$ 33
(
3,029 )

147

($ 2,849)

$ 802		 Recognized in
other
comprehensive
income


$ -
812
-

$ 812



$ -		 Closing Balance Closing Balance




(		 $ 351
10,901
391

$ 11,643

$ 10,416)











(		 $ 384
8,684
538
$ 9,606
$ 9,614)

210

For the year ended December 31, 2022

For the year ended December 31, 2022 For the year ended December 31, 2022 For the year ended December 31, 2022 For the year ended December 31, 2022
Opening Balance
Recognized in
profit or loss
Deferred tax assets
Temporary differences
Unrealized write-downs of
inventories
$ 1,523
( $ 1,172 )
Defined benefit obligations

15,278 (
930 )
Others

390

1

$ 17,191
($ 2,101)

Deferred tax liabilities
Temporary differences
Unappropriated earnings of
subsidiaries and associates
($ 10,578)
$ 162
Income tax recognized in other comprehensive income
2023
Deferred tax
In respect of the current year
- Remeasurement of defined
benefit plans
($ 812)		 Recognized in
other
comprehensive
income



)

)



 Closing Balance
$ (

($ $		 -
3,447
-

$ 351

10,901

391
$ 11,643


($ 10,416)
2022
$ 3,447

$
-
( $
812)		 $ 3,447
  • (3) Income tax recognized in other comprehensive income

(4) Deductible temporary differences for which no deferred tax assets have been recognized in the balance sheets

balance sheets
Deductible temporary differences December 31, 2023
$ 335		 December 31, 2022
$ 335
  • (5) Income tax assessment

The income tax returns of the Company through 2021 have been assessed by the tax authorities.

22. Earnings per share

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

Net profit for the year

earnings per share were as follows:
Net profit for the year
Earnings used in the computation of
basic earnings per share
Earnings used in the computation of
diluted earnings per share
Shares
Weighted average number of ordinary
shares used in the computation of basic
earnings per share
Effect of potentially dilutive ordinary
shares:
Employees’ compensation
Weighted average number of ordinary
shares used in the computation of
diluted earnings per share		 2023
$ 278,293
$ 278,293
2023
100,000
222
100,222		 2022

$ 250,730
$ 250,730
(Thousand shares)
2022


100,000
447
100,447

Since the Company offered to settle compensation paid to employees in cash or shares, the Company assumed the entire amount of the compensation will be settled in shares and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in the

211

computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

23. Capital management

The Company manages its capital to ensure that the Company will be able to continue as going concerns while maximizing the return to shareholders through the optimization of the debt and equity balance. The Company’s overall strategy remains unchanged from 2013.

The capital structure of the Company consists of net debt (borrowings offset by cash and cash equivalents) and equity attributable to owners of the Company (comprising issued capital, reserves, retained earnings and other equity).

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

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

24. Financial instruments

  • (1) Fair value of financial instruments not measured at fair value

The Company’s management believes the carrying amounts of financial assets and financial liabilities recognized in the financial statements approximate their fair values. Therefore, the carrying amounts of balance sheet is a reasonable basis for estimating the fair value.

  • (2) Fair value of financial instruments that are measured at fair value on a recurring basis Fair value hierarchy December 31, 2023
Fair value hierarchy
December 31, 2023
Financial assets at FVTPL
Fund beneficial certificates

Financial assets at FVTOCI
Investments in equity instruments at
FVTOCI

- Listed shares

- Unlisted shares


December 31, 2022
Financial assets at FVTPL
Fund beneficial certificates

Financial assets at FVTOCI
Investments in equity instruments at
FVTOCI

- Listed shares

- Unlisted shares

 Level 1
$ 10,000


$ 31,431

-

$ 31,431

Level 1
$ 19,505


$ 24,142

-

$ 24,142
 Level 2
$ -


$ -

-

$ -

Level 2
$ -


$ -

-

$ -
Level 3

$ -



$ -

1,595

$ 1,595

Level3

$ -



$ -

1,595

$ 1,595
Total


















$ 10,000
$ 31,431

1,595
$ 33,026
Total


















$ 19,505
$ 24,142

1,595
$ 25,737

There were no transfers between Level 1 and Level 2 f in the current and prior periods.

  • (3) Categories of financial instruments
Categories of financial instruments
Financial assets
Mandatorily classified as at FVTPL
Financial assets at amortized cost
(Note 1)
Financial assets at FVTOCI
Equity instruments		 December 31, 2023
$ 10,000
2,466,573
33,026		 December 31, 2022
$ 19,505
2,141,628
25,737

212

Financial liabilities
Financial liabilities at amortized cost
(Note 2)		 December 31, 2023
1,840,648		 December 31, 2022
1,772,843

Note 1: The balances include financial assets measured at amortized cost, which comprise cash and cash equivalents, debt investments, notes receivable, accounts receivable and other receivables.

Note 2: The balances include financial liabilities measured at amortized cost, which comprise notes payable, accounts payable and other payables.

(4)

  • Financial risk management objectives and policies

The Company's major financial instruments include equity and debt investments, accounts receivable, accounts payable and lease liabilities. The Company’s Corporate Treasury function provides services to the business, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Company through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk (including currency risk and interest rate risk), credit risk and liquidity risk.

  • A. Market risk

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

  • a. Foreign currency risk

The Company have foreign currency sales and purchases, which exposes the Company to foreign currency risk.

The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are set out in Note 28. Sensitivity analysis

The Company is mainly exposed to USD.

The following details the Company’s sensitivity to a 10% increase and decrease in New Taiwan dollars (the functional currency) against the relevant foreign currencies. The sensitivity rate of 10% used when reporting foreign currency risk internally to key management personnel and representing management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis included only outstanding foreign currency denominated monetary items and foreign currency forward contracts designated as cash flow hedges and adjusts their translation at the end of the reporting period for a 10% change in foreign currency rates. For the years ended December 31, 2023 and 2022, there would be an increase of $8,625 thousand and $5,205 thousand, respectively, in pre-tax profit associated with New Taiwan dollars strengthen 10% against USD. For a 10% weakening of New Taiwan dollars against USD, there would be an equal and opposite impact on pre-tax profit and the balances would be negative. The effect of exchange rate changes was mainly attributable to the exposure outstanding on USD cash, payables and borrowings, which were not hedged at the end of the reporting period.

b.

Interest rate risk

The Company is exposed to interest rate risk because the Company borrow funds at both fixed and floating interest rates. The risk is managed by the Company by maintaining an appropriate mix of fixed and floating rate borrowings.

The carrying amounts of the Company's financial assets and financial liabilities with exposure to interest rates at the end of the reporting period were as follows:

Fair value interest rate risk
- Financial assets
- Financial liabilities
Cash flow interest rate risk
- Financial assets		 December 31, 2023
$ 677,269
82,538
437,492		 December 31, 2022
$ 518,107
3,548
220,766

Sensitivity analysis

The sensitivity analysis below was determined based on the Company’s exposure to interest rates for non-derivative instruments at the end of the reporting period. For floating

213

rate liabilities, the analysis was prepared assuming the amount of each liability outstanding at the end of the reporting period was outstanding for the whole year. A 25 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

If interest rates had been 1 basis points higher/lower and all other variables were held constant, the Company’s pre-tax profit for the years ended December 31, 2023 and 2022 would increase/decrease by $1,094 thousand and $552 thousand, respectively.

  • B. Credit risk

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

The Company adopted a policy of only dealing with creditworthy counterparties. Before trading with new customers, the Company assessed the credit quality of potential customer by internal credit checking and set the credit limit which is reassessed annually.

C. Liquidity risk

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

The Company relies on bank borrowings as a significant source of liquidity. As of December 31, 2023 and 2022, the Company had available unutilized short-term bank loan facilities set out in b. below

  • a. Liquidity and interest risk rate table for non-derivative financial liabilities

  • The following table details the Company’s remaining contractual maturity for its

  • non-derivative financial liabilities with agreed repayment periods. The table has been drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Company can be required to pay. The table included both interest and principal cash flows. Specifically, bank loans with a repayment on demand clause were included in the earliest time band regardless of the probability of the banks choosing to exercise their rights. The maturity dates for other non-derivative financial liabilities were based on the agreed repayment dates.

December 31, 2023

3
O n Dema
t
1 M		 nd or Less
han
onth
1～3 months
3 months～1year
1～5years
More than 5years



- $ 1,840,648 $ - $ - $ -
3,621
7,242
31,440
41,892
-
-

-

423,170

-

-
3,621
$ 1,847,890
$ 454,610
$ 41,892
$ -
about the maturity analysis for lease liabilities was as follows:
Less than 1 year
1 to 5 years
5 to 10 years
$ 42,303
$ 41,892
$ -
nd or Less
han
onth
1～3 months
3 months～1year
1～5years
More than 5years



- $ 1,772,843 $ - $ - $ -
175
350
1,576
1,495
-
-

-

495,391

-

-
175
$ 1,773,193
$ 496,967
$ 1,495
$ -		 More than 5years
$
$

nd
han
on		 $
yea		 $ -
More than 5years
or Less

th

-
175
-
175
 3 months～1year

$ -
1,576

495,391
$ 496,967

N

on-derivative financial
liabilities

on-interest bearing

ease liabilities

inancial guarantee
contracts
O



$









$

$ -
-

-
$ -
N
L
F
$ $

214

Further information about the maturity analysis for lease liabilities was as follows:

Less than 1 year 1 to 5 years 5 to 10 years Lease liabilities $ 2,101 $ 1,495 $ -

The amounts included above for financial guarantee contracts are the maximum amounts the Company could be required to settle under the arrangement with option to demand full guaranteed amount if that amount is claimed by the counterparty to the guarantee. Based on expectations at the end of the reporting period, the Company considers that it is more likely than not that no amount will be payable under the arrangement.

The amounts included above for variable interest rate instruments for both nonderivative financial assets and liabilities is subject to change if changes in variable interest rates differ from those estimates of interest rates determined at the end of the reporting period.

  • b.

Financing facilities

period.
Financing facilities
Unsecured bank financing
facilities, reviewed annually
and payable on demand:
- Amount used
- Amount unused		 December 31, 2023
$ 727,236

1,657,764
$ 2,385,000		 December 31, 2022




$ 418,077
1,416,923
$ 1,835,000

25. Related Parties Transactions

Besides information disclosed elsewhere in the other notes, details of transactions between the Company and other related parties are disclosed below.

  • (1) Related-party and its relationship

Related Party Relationship Furly Investment Co., Ltd. (Furly Investment) Substantive related party Chuan Gao Investment Co., Ltd. (Chuan Gao Investment) Substantive related party 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

  • (2) Operating revenue (sales, maintenance and rental revenue)
Related Party Categories
Subsidiaries
Associates
Joint venture		 2023
$ 4,635
120
1,131
$ 5,886		 2022




$ 17,058
230
113
$ 17,401

215

(3) Operating costs (sales, maintenance and rental revenue)
Related Party Categories
2023
Subsidiaries
$ 52,299
Associates
2,797
Joint venture

4
$ 55,100		 2022


$ 61,543
9,580
2,669
$ 73,792
(4) Receivables from related parties (excluding loans to related parties)
Line Item
Related Party Categories
December 31, 2023
Accounts
receivable
Subsidiaries
$ 1,226
Associates

-
Joint venture

247

$ 1,473
 December 31, 2022 December 31, 2022


$ 15,075
178
72
$ 15,325

The outstanding accounts receivable from related parties are unsecured. For the years ended December 31, 2023 and 2022, no impairment loss was recognized on accounts receivable from related parties.

  • (5) Payables to related parties (excluding loans from related parties)
Line Item
Accounts
payable



 Related Party Categories

Subsidiaries

Associates

Joint venture

Substantive related party

 December 31, 2023
$ 6,653

1,206

1,500

9

$ 9,368
 December 31, 2022 December 31, 2022






$ 26,520
2,151
1,473
10
$ 30,154

The outstanding accounts payable from related parties are unsecured.

  • (6) Acquisition of property, plant and equipment
Acquisition of property, plant and equipment
Purchase Price
Related Party Categories
2023
2022
Subsidiaries
$ -
$ 87
Associates

4,295

7,660
$ 4,295
$ 7,747
Lease agreement
Related Party
Categories/Name
2023
2022
Acquisition of right-
of-use assets
Substantive related party
Chuan Gao Investment
$ 68,488
$ -
Furly Investment

51,843

-
$ 120,331
$ -
Line Item
Related Party Categories /Name December 31, 2023 December 31, 2022
Lease liabilities
Substantive related party
Chuan Gao Investment

$ 46,923

$ 1,037
Furly Investment


34,923


-
$ 81,846
$ 1,037		 Purchase Price
2022
$

$ 87
7,660
$ 7,747
2022
$
$ -

-
$ -
December 31, 2022


$ 1,037
-
$ 1,037
  • (7) Lease agreement

216

Line Item
Finance costs


 Related Party Categories /Name
Substantive related party
Chuan Gao Investment

Furly Investment
 2023
$ 1,194

895

$ 2,089		 2022




$ 163
106
$ 269

  • (8) Endorsement and guarantee Refer to Table 1 for information relating to endorsements and guarantees provided with related

  • parties.

  • (9) Rental expenses

Rental expenses
Line Item
Operating

expenses


 Related Party Categories/Name
Substantive related party
Chuan Gao Investment

Furly Investment

others
 2023
$ 4,880

1,302

-

$ 6,182		 2022




$ 2,709
1,565
72
$ 4,346
  • (10) Rental revenue
Rental revenue
Line Item Related Party Categories/Name 2023 2022
Other income Joint venture
Cloudmaster Co., Ltd.
 $ 1,779
 $ 1,685
Subsidiaries
Wisemaker Technology Co.
 1,132 1,479
Netmaker Technology Co., Ltd. 500 484
Others
 16
 18
1,648
 1,981
$ 3,427
 $ 3,666
  • (11) Compensation of key management personnel
Compensation of key management personnel
Short-term employee benefits
Post-employment benefits		 2023
$ 327,660
12,765
$ 340,425		 2022




$ 291,365
12,024
$ 303,389

The remuneration of directors and key executives was determined by the remuneration committee based on the performance of individuals and market trends.

  1. Assets Pledged as Collateral

The assets pledged as collaterals for system design contract, bank loans and for product warranty were as follows:

as follows:
Pledge deposits (classified as financial
assets at amortized cost)		 December 31, 2023
$ 326,187		 December 31, 2022
$ 230,417

27. Significant Contingent Liabilities and Unrecognized Commitments

As of December 31, 2023, for the contracts with customers and the application for government grants, the Company issued guarantee notes and had bank guarantee amounting to $100,272 thousand and $727,236 thousand, respectively.

28. Significant Assets and Liabilities Denominated in Foreign Currencies

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

217

December 31, 2023
Financial assets
Monetary items
USD
JPY
HKD
Non-monetary items
USD
JPY
Financial liabilities
Monetary items
USD
JPY
HKD
Non-monetary items
USD
December 31, 2022
Financial assets
Monetary items
USD
JPY
HKD
Non-monetary items
USD
JPY
Financial liabilities
Monetary items
USD
JPY
Non-monetary items
USD		 Foreign Currencies
$ 3,089
99
236
3,151
57,237
281
5,553
79
3,089
Foreign currency
$ 2,783
921
355
3,210
66,636
1,088
9,255
2,324		 Exchange rate
30.705
0.2172
3.929
30.705
0.2172
30.705
0.2172
3.929
30.705
Exchange rate
30.71
0.2324
3.938
30.71
0.2324
30.71
0.2324
30.71		 Carrying amount
$ 94,862
22
927
96,751
12,432
8,614
1,206
310
94,834
Carrying amount
$ 85,455
214
1,399
98,578
15,486
33,408
2,151
71,381

The significant realized and unrealized foreign exchange gains (losses) were as follows:

Foreigncurrency
USD
 2023 Net Foreign
Exchange Gain
(Loss)
$ 1,303		 2022
Exchangerate
31.155(USD: NTD)
 Exchangerate
29.805 (USD: NTD)
 Net Foreign
Exchange Gain
(Loss)
$ 1,707

29. Separately Disclosure Items

  • (1) Information about significant transactions:

  • A. Financing provided to others: None.

  • B. Endorsements/guarantees provided (Table 1).

  • C. Marketable securities held (excluding investment in subsidiaries, associates and joint ventures) (Table 2).

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

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

218

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

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

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

  • I. Trading in derivative instruments: None.

  • (2) Information on investees: (Table 3).

  • (3) Information on investments in Mainland China:

  • A. Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, investment income or loss, carrying amount of the investment at the end of the period, repatriations of investment income, and limit on the amount of investment in the mainland China area: (Table 4).

  • B. Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses: None.

    • a. The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period.

    • b. The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period.

    • c. The amount of property transactions and the amount of the resultant gains or losses. d. The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes.

    • e. The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds.

    • f. Other transactions that have a material effect on the profit or loss for the year or on the financial position, such as the rendering or receipt of services.

  • (4) Information of major shareholders: list all shareholders with ownership of 5% or greater showing the name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder:(Table 5)

219

SYSCOM COMPUTER ENGINEERING CO. Endorsements/Guarantees Provided For the Year Ended December 31, 2023

Table1 (In Thousands ofNewTaiwan Dollars/ForeignCurrency) (In Thousands ofNewTaiwan Dollars/ForeignCurrency) (In Thousands ofNewTaiwan Dollars/ForeignCurrency) (In Thousands ofNewTaiwan Dollars/ForeignCurrency) (In Thousands ofNewTaiwan Dollars/ForeignCurrency)
No. Endorser/
Guarantor		 Endorsee/
Guarantee		 Limits on
Endorsement/
Guarantee Given
on Behalf of
Each Party		 Maximum Amount
Endorsed/
Guaranteed During
the Period		 Outstanding
Endorsement/
Guarantee at the End
of the Period (Note 1)		 Actual Borrowing
Amount		 Amount Endorsed/
Guaranteed by
Collateral		 Ratio of
Accumulated
Endorsement
/Guarantee to
Net Equity in
Latest Financial
Statements
(%)
Aggregate
Endorsement/
Guarantee Limit		 Endorsement
/Guarantee
Given by
Parent on
Behalf of
Subsidiaries		 Endorsement
/Guarantee
Given by
Subsidiaries on
Behalf of
Parent
Endorsement
/Guarantee
Given on
Behalf of
Companies in
Mainland
China
Name Relationship
0 Syscom
Computer
Engineering
Co.		 Syscom Computer (Shenzhen)
Co., Ltd.
Xian Linan Computer Co.,
Ltd.
Netmaker Technology Co.,
Ltd.
Coach Technology
Management Inc.
Indirect
subsidiary
Indirect
subsidiary
Subsidiaries
Subsidiaries		 20% of the net
worth
$422,841
Same as above
Same as above
Same as above		 $ 334,685
( USD
10,900 )
60,642
( USD
1,975 )
85,000
15,000		 $ 282,486
( USD
9,200 )
40,684
( USD
1,325 )
85,000
15,000		 $ 153,125
( USD
4,987 )
29,947
( USD
975 )
7,500
-		 $ -
-
-
-		 13.36
1.92
4.02
0.71		 50% of the net worth
$1,057,104
Same as above
Same as above
Same as above		 Yes
Yes
Yes
Yes		 No
No
No
No		 Yes
Yes
No
No

Note:The above amounts were translated into New Taiwan dollar at the prevailing exchange rate as of December 31, 2023.

220

SYSCOM COMPUTER ENGINEERING CO. Marketable securities held December 31, 2023

Table 2

(In Thousands of New Taiwan Dollars and in thousands of Shares (Thousands of Units))

Holding Company Name Type and name of marketable securities Relationship with the Holding
Company		 Financial Statement Account December 31, 2023 December 31, 2023 Note
Number of
shares/units		 Carrying amount Percentage of
Ownership (%)		 Fair value
SYSCOM COMPUTER
ENGINEERING CO.
Coach Technology Management Inc.		 Beneficial certificates
Yuanta Japan Leaders Equity Fund
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		 1,000
273
195
166
2
31
$ 10,000

1,595

29,898

1,470

63

457		 -
9.09
0.90
-
-
-		 $ 10,000
1,595
29,898
1,470
63
457

Note 1: The securities referred to in this table include stocks, bonds, mutual funds and securities derived from the above - mentioned items within the scope of International Financial Reporting Standard No. 9 “Financial Instruments”. Note 2: The above shares or certificates were not provided as guarantee.

221

SYSCOM COMPUTER ENGINEERING CO. Information on investees For the Year Ended December 31, 2023

Table 3

(In Thousands of New Taiwan Dollars/Thousands of Shares)

Investor Company Investee Company Location Main Businesses and Products Original investment amount Original investment amount Holdingat the end of theperiod Holdingat the end of theperiod Holdingat the end of theperiod Net Income (Loss) of the
Investee		 Share of Profit (Loss) Note
December 31, 2023 December 31, 2022 Number of
Shares
(Thousands)		 Percentage of
Ownership		 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
42,191
JPY
53,260
THB
33,134
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
2,679
5
3,440
6,500
20		 97.50
100.00
100.00
86.60
99.24
49.89
92.47
50.00
0.54		 $ 6,550
96,751
( 94,834 )
35,643
60,187
12,432
3,004
55,426
17		 $ 2,276
(
1,922 )
(
25,160 )
(
4,752 )

4,003
(
4,184 )
(
178 )

3,128
(
178 )
 $ 2,219
(
1,922 )
(
25,160 )
(
4,115 )

3,982
(
2,087 )
(
165 )

1,564
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 foreign currency amount of the net income of the investee is expressed in New Taiwan dollars at the average exchange rate in 2023.

222

SYSCOM COMPUTER ENGINEERING CO. Information on investments in Mainland China For the Year Ended December 31, 2023

For the Year Ended December For the Year Ended December 31, 2023
Table 4 (In Thousands of New Taiwan Dollars/Foreign Currency)
Investee Company Main Businesses and
Products		 Paid-in capital Method of
Investment		 Accumulated Outward
Remittance for
Investment from
Taiwan as of
January 1, 2023		 Remittance of Funds Accumulated Outward
Remittance for
Investment from
Taiwan as of
December 31, 2023		 Net Income (Loss) of
the Investee		 % Ownership of
Direct or
Indirect
Investmen		 Investment Gain
(Loss)		 Carrying Amount as of
December 31, 2023
Accumulated
Repatriation of
Investment Income as
of December 31, 2023		 Note
Outward Inward
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
manufacture of
computer equipment
and computer
software; sale of self-
manufactured
products and
provision of technical
services.
$ 138,173
(
USD
4,500 )

70,622
( USD
2,300 )		 Note 1
Note 1		 $ 128,040
( USD
4,170 )
46,610
( USD
1,518 )		 $ -
-		 $ -
-		 $ 128,040
( USD
4,170 )
46,610
( USD
1,518 )		 ( $ 25,361 )
( (USD
814 ))
(Note 2)
(
2,513 )
( (USD
81 ))
(Note 2)		 98.27%
74.38%		 ( $ 24,922 )
( (USD
800 ))
(Note 2)
(
1,869 )
( (USD
60 ))
(Note 2)		 ( $ 96,311 )
( (USD
3,137 ))
(Note 2)
(
4,532 )
( (USD
148 ))
(Note 2)		 $ -
-

Accumulated Outward Remittance for Investment in Upper Limit on the Amount of Investment Stipulated by Mainland China as of Investment Amounts Authorized by Investment Investment Commission, MOEA Commission, MOEA December 31, 2023 (Note 3) $ 174,650 $ 174,650 ( USD 5,688 ) ( USD 5,688 ) (Note 1(2)) $ 1,268,524 13,394 ( USD 436 ) (Note 1(1))

Note 1: Investment methods are classified into the following two categories:

(1) An investee of CASEMaker, Inc., a wholly owned subsidiary of Syscom Computer Engineering Company and capital increase from capital surplus.

(2) An investee of Syscom International Inc., a wholly owned subsidiary of Syscom Computer Engineering Company.

Note 2: Amount was recognized based on the financial statements which were audited by CPAs on December 31, 2023.

Note 3: According to the "Principles for the Review of Investment or Technical Cooperation in the Mainland Area" stipulated by the Investment Commission of the Ministry of Economic Affairs (MOEAIC), the upper limit is calculated as follows: 60% of the shareholders ’ equity = $2,114,207 × 60% = $1,268,524

Note 4: The foreign currency amounts of original investment amount and carrying value are expressed in New Taiwan dollars at exchange rate as of December 31, 2023. The foreign currency amount of net income is expressed in New Taiwan dollars at average exchange rate for the year ended December 31, 2023

223

SYSCOM COMPUTER ENGINEERING CO. Information on major shareholders December 31, 2023

Table 5

Table 5
Name of major shareholder Shareholding
Number of shares held Shareholding
percentage
Jui-Fu Liu
Chi-Shan Liu
Su-Chen Yang		 18,346,787
7,598,911
7,256,001		 18.34%
7.59%
7.25%

Note: The information of major shareholders presented in this table is provided by the Taiwan Depository & Clearing Corporation based on the number of ordinary shares and preferred shares held by shareholders with ownership of 5% or greater, that have been issued without physical registration (including treasury shares) by the Corporation as of the last business day for the current quarter. The share capital in the parent company only financial statements may differ from the actual number of shares that have been issued without physical registration because of different preparation basis.

224

  • 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.

225

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		 2023 2022 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		 4,016,109
362,728
2,312
465,121
4,846,270
2,612,316
116,650
2,728,966
1,000,000
1,797
1,100,682
11,728
3,097
2,117,304
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
251,360

5,400

(98)

154,668

411,330

328,059

20,780

348,839

0

250

56,131

7,981

(1,871)

62,491
7

2

(4)

50

9

14

22

15

0

16

5

213

(38)

3
1. Analysis of change in percentage:
(1)The increase in other assets：Mainly due to the increase in right-of-use assets.
(2)The increase in non-current liabilities: Mainly due to the increase in lease liabilities.
(3)The increase in other equity: Mainly due to the increase in unrealized gain or loss on financial
assets measured at fair value through other comprehensive income.
2. Future countermeasures: None.

226

II. financial performance

(I)Analysis of financial performance

Unit:Thousands ofNTD
Year
Item
2023
2022
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
6,383,820
5,950,524
433,296
7
Operating costs
4,722,942
4,432,024
290,918
7
Gross profit
1,660,878
1,518,500
142,378
9
Operating expenses
1,375,419
1,254,095
121,324
10
Profit from operations
285,459
264,405
21,054
8
non-operating income and expenses
44,048
40,251
3,797
9
Profit before income tax
329,507
304,656
24,851
8
Income tax
52,869
59,711
(6,842)
(11)
Net profit
276,638
244,945
31,693
13
Other comprehensive income for the
year, net of income tax
5,961
25,146
(19,185)
(76)
Total comprehensive income
282,599
270,091
12,508
5
Net proif attributable to Owners Of
the Company
278,293
250,730
27,563
11
Total comprehensive income
attributable to Owners Of the
Company
284,112
275,729
8,383
3
1. Analysis of change in percentage：
The decrease in other comprehensive income for the year, net of income tax: Mainly due to the
decrease in the number of remeasurements of the defined benefit plan.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2023:
Please refer to the market, production and sales overview of operations overview in this Annual
Report.		 Unit:Thousands ofNTD
Year
Item
2023
2022
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
6,383,820
5,950,524
433,296
7
Operating costs
4,722,942
4,432,024
290,918
7
Gross profit
1,660,878
1,518,500
142,378
9
Operating expenses
1,375,419
1,254,095
121,324
10
Profit from operations
285,459
264,405
21,054
8
non-operating income and expenses
44,048
40,251
3,797
9
Profit before income tax
329,507
304,656
24,851
8
Income tax
52,869
59,711
(6,842)
(11)
Net profit
276,638
244,945
31,693
13
Other comprehensive income for the
year, net of income tax
5,961
25,146
(19,185)
(76)
Total comprehensive income
282,599
270,091
12,508
5
Net proif attributable to Owners Of
the Company
278,293
250,730
27,563
11
Total comprehensive income
attributable to Owners Of the
Company
284,112
275,729
8,383
3
1. Analysis of change in percentage：
The decrease in other comprehensive income for the year, net of income tax: Mainly due to the
decrease in the number of remeasurements of the defined benefit plan.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2023:
Please refer to the market, production and sales overview of operations overview in this Annual
Report.		 Unit:Thousands ofNTD
Year
Item
2023
2022
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
6,383,820
5,950,524
433,296
7
Operating costs
4,722,942
4,432,024
290,918
7
Gross profit
1,660,878
1,518,500
142,378
9
Operating expenses
1,375,419
1,254,095
121,324
10
Profit from operations
285,459
264,405
21,054
8
non-operating income and expenses
44,048
40,251
3,797
9
Profit before income tax
329,507
304,656
24,851
8
Income tax
52,869
59,711
(6,842)
(11)
Net profit
276,638
244,945
31,693
13
Other comprehensive income for the
year, net of income tax
5,961
25,146
(19,185)
(76)
Total comprehensive income
282,599
270,091
12,508
5
Net proif attributable to Owners Of
the Company
278,293
250,730
27,563
11
Total comprehensive income
attributable to Owners Of the
Company
284,112
275,729
8,383
3
1. Analysis of change in percentage：
The decrease in other comprehensive income for the year, net of income tax: Mainly due to the
decrease in the number of remeasurements of the defined benefit plan.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2023:
Please refer to the market, production and sales overview of operations overview in this Annual
Report.		 Unit:Thousands ofNTD
Year
Item
2023
2022
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
6,383,820
5,950,524
433,296
7
Operating costs
4,722,942
4,432,024
290,918
7
Gross profit
1,660,878
1,518,500
142,378
9
Operating expenses
1,375,419
1,254,095
121,324
10
Profit from operations
285,459
264,405
21,054
8
non-operating income and expenses
44,048
40,251
3,797
9
Profit before income tax
329,507
304,656
24,851
8
Income tax
52,869
59,711
(6,842)
(11)
Net profit
276,638
244,945
31,693
13
Other comprehensive income for the
year, net of income tax
5,961
25,146
(19,185)
(76)
Total comprehensive income
282,599
270,091
12,508
5
Net proif attributable to Owners Of
the Company
278,293
250,730
27,563
11
Total comprehensive income
attributable to Owners Of the
Company
284,112
275,729
8,383
3
1. Analysis of change in percentage：
The decrease in other comprehensive income for the year, net of income tax: Mainly due to the
decrease in the number of remeasurements of the defined benefit plan.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2023:
Please refer to the market, production and sales overview of operations overview in this Annual
Report.		 Unit:Thousands ofNTD
Year
Item
2023
2022
Increase
(decrease)
amount
change
Proportion
(%)
Net operating revenue
6,383,820
5,950,524
433,296
7
Operating costs
4,722,942
4,432,024
290,918
7
Gross profit
1,660,878
1,518,500
142,378
9
Operating expenses
1,375,419
1,254,095
121,324
10
Profit from operations
285,459
264,405
21,054
8
non-operating income and expenses
44,048
40,251
3,797
9
Profit before income tax
329,507
304,656
24,851
8
Income tax
52,869
59,711
(6,842)
(11)
Net profit
276,638
244,945
31,693
13
Other comprehensive income for the
year, net of income tax
5,961
25,146
(19,185)
(76)
Total comprehensive income
282,599
270,091
12,508
5
Net proif attributable to Owners Of
the Company
278,293
250,730
27,563
11
Total comprehensive income
attributable to Owners Of the
Company
284,112
275,729
8,383
3
1. Analysis of change in percentage：
The decrease in other comprehensive income for the year, net of income tax: Mainly due to the
decrease in the number of remeasurements of the defined benefit plan.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2023:
Please refer to the market, production and sales overview of operations overview in this Annual
Report.
Year
Item
2023		 2022 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		 6,383,820
4,722,942
1,660,878
1,375,419
285,459
44,048
329,507
52,869
276,638

5,961
282,599
278,293
284,112
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
433,296

290,918

142,378

121,324

21,054

3,797

24,851

(6,842)

31,693

(19,185)

12,508

27,563

8,383
7

7

9

10

8

9

8

(11)

13

(76)

5

11

3
1. Analysis of change in percentage：
The decrease in other comprehensive income for the year, net of income tax: Mainly due to the
decrease in the number of remeasurements of the defined benefit plan.
2. Reasons for the change in the Company's main business: None.
3. Analysis of sales for 2023:
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.

227

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
600,941 653,607 370,054 884,494
-		 -
1. Analysis of change in cash flows for the year:
(1) Operating activities: The net cash inflow from operating activities of NTD 653,607 thousand
is mainly due to the increase in contract liabilities.
(2) Investing activities: The net cash outflow from investing activities of NTD 108,236 thousand
is mainly due to the increase in financial assets measured at amortized cost during the
current period.
(3) Financing activities: Net cash outflows from financing activities were $261,256 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: $884,494 thousand
Estimated net cash inflows from operating activities for the whole year: $297,880 thousand
Estimated cash outflows for the whole year: $417,000 thousand
Estimated cashsurplus (shortage): $765,374thousand

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 increase in profit and loss of the Company’s reinvestment companies in 2023 compared to 2022 was mainly due to the proper control of the progress and expenses of some of the reinvestment companies. The Company will continue to implement the production and sales strategy and expense and cost control plans 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: Except for the cash capital increase of the mainland subsidiary, Xian Linan Computer Co., Ltd. through SYSCOM INTERNATIONAL INC. in the first quarter of 2024, there is no other investment plan.

228

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 2023 (Thousands of NTD，%)
Net interest income and expense (6,645)
Net exchange gain or loss (1,805)
Net interest income and expense as a
percentage of net revenue		 (0.10%)
Net interest income and expense as a
percentage of net profit before tax		 (2.02%)
Net exchange gain or loss as a percentage
of net revenue		 (0.03%)
Net exchange gain or loss as a percentage
of net profit before tax		 (0.55%)
  • (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 $506,639 thousand and $190,855 thousand, respectively, at the end of 2023. The Company manages interest rate risk by maintaining an appropriate combination of fixed and floating interest rates for short-term borrowings.

  • (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 2.50% in 2023. 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

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.

  • (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., $282,486 thousand for the sub-subsidiary, Syscom Computer(Shenzhen)Co., Ltd., and $40,684 thousands for the sub-subsidiary, Xian Linan Computer Co., Ltd.. Handled in accordance with the "Endorsement and Guarantee Regulations"

229

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 1.5.5)		 500
Opus One IP Continuous Configuration Management
Platform (Version 1.5.6)		 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 1.5.5)		 65% 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 receiving automatic
and 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
worktrackingmanagement.

2024/08
Opus One IP Continuous
Configuration Management
Platform (Version 1.5.6)		 0% Add/improve the following functions of
the maintenance management module of
Opus One, provide the data collection and
analysis function for smart data
management, add IoT data management
function, and enable Opus One to support
customers’ new maintenance
requirements to enhance product
competitiveness.
⚫
Research and design various data
collection methods and add them to
the Agent function.
⚫
Research and design multi-type
data aggregation and analysis
platform functions.
⚫
Functional design and development
of multi-functional maintenance
and operation monitoring platform.
⚫
Function of each module SSO
securitycertification module.
2025/06

230

  • (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.

  • (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 Responsibilities unit Marketing Responsible for developing the company's marketing strategy, product Division strategy, product pricing, market information collection and establishment, etc. to reduce strategic risks and business operation risks.

231

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.

232

Eight. Special matters

  • I. Information about the Company’s Affiliates

  • (I)Organization chart (December 31,2023)

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% 99.24%
97.50% 92.47%
Syscom Xian Linan
Computer Computer
(Shenzhen) Co., Ltd.
Co., Ltd. 74.38%
98.27%
----- End of picture text -----

233

(II) Basic data of affiliates(December 31,2023)

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 4F 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.

234

(III)Information of Director,Supervisor and President in each affiliated company (December 31,2023)

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 Chih-Wei Wen 0
0%
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)		 2,679,450 99.24%
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 Chia-Hsuan Chung - 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%
Supervisor Li-Hung Tai - 0%

235

(IV) Overview of the operations of the affiliates(December 31,2023)

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

99,625
2,874
96,751
8,527
(5,322)
(1,922)
(1.48)
Coach Technology
Management Inc.		 20,000
9,672
3,562
6,110
11,870
2,462
2,276
1.14
Syscom Computer
(Thailand)Co., Ltd.		 THB
37,200

4,845
1,597
3,248
3,349
(161)
(178)
(0.05)
Netmaker
Technology Co., Ltd.		 33,000
71,231
30,072
41,159
98,748
(5,499)
(4,752)
(1.44)
Wisemaker
Technology Co.		 27,000
68,288
7,640
60,648
39,754
4,540
4,003
1.48
Syscom International
Inc.		 USD
6,050

(94,835)
0
(94,835)
0
0
(25,160)
(4.16)
Syscom Computer
(Shenzhen) Co., Ltd.		 USD
4,500

78,407
176,417
(98,010)
112,054
(9,937)
(25,361)
-
Xian Linan
Computer Co. Ltd.		 USD
2,300

32,828
38,921
(6,093)
44,582
(1,854)
(2,513)
-

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.127

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.

236

SYSCOM COMPUTER ENGINEERING CO.

Chairman Jui-Fu Liu

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