TEX YEAR - Audit Report / Information 2020

Stock Code: 4720

Tex Year Industries Inc.

Individual Financial Statements and Independent Auditor’s Review Report

2020 and 2019

Address: No. 9, Wuquan 6th Road, Wugu District, New Taipei City

Telephone: (02)22992121

INDEPENDENT AUDITOR’S REVIEW REPORT

Board of directors and shareholders Tex Year Industries Inc.:

Audit Opinion

We have audited the accompanying individual balance sheets of Tex Year Inc. as of December 31, 2020 and 2019, and the related individual statement of comprehensive income, changes in equity, and cash flows for the years 2020 and 2019 from January 1 to December 31, and the related notes to the individual financial statements, which include a summary of significant accounting policies.

In our opinion, based on our audits and the reports of the other auditors (see Other Matters), the individual financial statements referred to above have been prepared, in all material respects, in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and are fairly stated in terms of the individual financial position of Tex Year Inc. Ltd. as of December 31, 2020 and 2019, and the individual financial performance and cash flows for the years 2020 and 2019 from January 1 to December 31.

Basis of Audit Opinion

We conducted our audits in 2020 in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China; and in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants, the Financial Supervisory Commission’s Official Letter No. 1090360805 dated February 25, 2020, and auditing standards generally accepted in the Republic of China. Our responsibility under these standards will be further explained in the paragraph of our responsibility to review the individual financial statements. The staff of the firm to which we are affiliated, who are subject to the independence regulation, have maintained superior independence from Tex Year in accordance with the Code of Ethics for Accountants, and have fulfilled other responsibilities under the Code. We

believe that we have obtained sufficient and appropriate audit evidence to form the basis of our audit opinion.

Key Audit Matters

A critical audit is one that, in our professional judgment, is material to the examination of the individual financial statements of Tex Year Inc. as of and for the year ended December 31, 2020. These matters have been considered in the process of examining the individual financial statements taken as a whole and forming an opinion thereon, and we do not express an opinion on these matters individually.

The critical audited financial statements of Tex Year Inc. for the year ended December 31, 2020 are summarized as follows:

Evaluation of allowance for loss on accounts receivable

As of December 31, 2020, Tex Year and its subsidiaries had net accounts receivable of NT$249,438 thousand (total accounts receivable of NT$265,729 thousand net of allowance for losses of NT$16,291 thousand), representing approximately 10% of total assets. Tex Year evaluates the expected credit losses based on the aging of accounts receivable and overdue receivables in accordance with the expected credit loss accrual policy. Because of the significant judgment and estimation uncertainty involved in assessing the impairment of accounts receivable, management has made the assessment of allowance for losses on accounts receivable a critical review for the year.

Please refer to Notes 4(11), 5(1) and 10 to the individual financial statements for the accounting policies, significant accounting judgments, estimation and assumption uncertainties and disclosures related to the evaluation of allowance for losses on accounts receivable.

Our audit procedures for assessing the potential risks associated with the allowance for losses on receivables in the course of our audit are as follows.

To understand and sample the effectiveness of the design and implementation of the internal control system related to the evaluation of the allowance for losses on accounts receivable.
The ageing schedule of accounts receivable as of December 31, 2020 was obtained and tested on a sample basis to verify the correctness of the ageing schedule of accounts receivable.
For individual customers with significant accounts receivable balances and delayed collection, the status of post-period collection is examined to test the recoverability of accounts and the adequacy of the impairment loss provision.

Other Matters

The individual financial statements of Tex Year Enterprises, Inc. and its subsidiaries, certain subsidiaries and investment companies using the equity method have not been audited by us, but by other auditors. Accordingly, our opinion on the financial statements referred to above is based on our review of the amounts and disclosures in the notes to the financial statements of certain investees in respect of investments accounted for using the equity method. As of December 31, 2020 and 2019, the balances of these investments accounted for by the equity method were $870,221 thousand and $751,531 thousand, respectively, accounting for 36% and 32% of total assets, and the shares of subsidiaries and joint venture interests recognized from January 1 to December 31, 2020 and 2019were $70,116 thousand and $25,104 thousand, respectively, accounting for 91% and 47% of net income before income tax.

Responsibility of Management and Governance Unit to Individual Financial Statements

Management’s responsibility is to prepare fairly presented financial statements in accordance with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers and to maintain such internal control relevant to the preparation of financial statements as is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the individual financial statements, management’s responsibility also includes assessing Tex Year Industries Inc.’s ability to continue as a going concern, the disclosure of related matters, and the adoption of the going concern basis of accounting, unless management intends to liquidate Tex Year Industries Inc. or cease operations, or there is no practical alternative to liquidation or cessation of operations.

The governance units (including supervisors) of Tex Year are responsible for overseeing the financial reporting process.

Responsibility of Accountants Auditing Individual Financial Statements

The purpose of our audit is to obtain reasonable assurance about whether the individual financial statements taken as a whole are free from material misstatement, whether due to fraud or error, and to issue a report thereon. However, an audit performed in accordance with generally accepted auditing standards does not provide assurance that

material misstatements in the individual financial statements will be detected. Misrepresentation may be the result of fraud or error. Individual amounts or aggregates that are not true are considered material if they could reasonably be expected to affect the economic decisions made by users of the individual financial statements.

We conducted our audit in accordance with generally accepted auditing standards, exercising our professional judgment and maintaining our professional skepticism. We also perform the following tasks.

Identify and assess the risks of material misstatement of the individual financial statements arising from fraud or error; design and implement appropriate responses to the risks assessed; and obtain sufficient and appropriate evidence to provide a basis for an audit opinion. Because fraud may involve conspiracy, forgery, intentional omission, misrepresentation or a breach of internal control, the risk of not detecting material misstatement due to fraud is higher than that due to error.
We obtained an understanding of the internal control relevant to our 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 Tex Year Enterprises, Inc.' internal control.
Evaluate the appropriateness of the accounting policies used by management and the reasonableness of the accounting estimates and related disclosures made by management.
Based on the evidence obtained, we have made a conclusion on the appropriateness of management's adoption of the going concern basis of accounting and whether there is any material uncertainty about the events or circumstances that may cast significant doubt on the ability of Tex Year Industries Inc. to continue as a going concern. If we believe that there is a material uncertainty about such events or conditions, we should draw the attention of users of the individual financial statements to the relevant disclosures in the audit report or revise our audit opinion if such disclosures are inappropriate. Our conclusion is based on the audit evidence obtained up to the date of the audit report. However, future events or circumstances may cause Tex Year Enterprises, Inc. and its subsidiaries to cease to have the ability to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the related notes, and whether the individual financial statements present fairly the related transactions and events.
We obtained sufficient and appropriate audit evidence on the financial information of the constituent entities of the Group to express an opinion on the individual financial statements. We are responsible for the direction, supervision and execution of the Company’s audits, and for forming an opinion on the Company's audits.

We will communicate with the governance unit regarding the scope and timing of the planned audit and significant audit findings, including significant deficiencies in internal control identified during the audit.

We also provide the governing body with a statement that the independence-regulated personnel of the firm to which we are affiliated have complied with the Code of Ethics for Accountants with respect to independence, and communicate with the governing body about all relationships and other matters (including related safeguards) that may be considered to affect the accountant's independence.

We have determined, based on our review of the individual financial statements of Tex Year Inc. as of and for the year ended December 31, 2020, that the audit was critical. We identified those matters in our auditor's report, except for those matters that are not permitted by law to be disclosed publicly or, in the rarest of circumstances, where we decided not to communicate those matters in our auditor's report because the negative effect of such communication could reasonably be expected to outweigh the public interest that would be served.

Deloitte & Touche Taipei, Taiwan Republic of China March 31, 2021

Notice to Readers

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

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

Tex Year Industries Inc.

Individual Balance Sheet

December 31, 2020 and 2019

In thousand of New Taiwan Dollars

Code 1100 1110 1150 1170 1180 1200 1210 130X 1470 11XX 1517 1540 1550 1600 1755 1821 1840 1990 15XX 1XXX Code 2100 2170 2180 2200 2220 2230 2250 2280 2320 2399 21XX 2530 2540 2570 2580 2640 2670 25XX 2XXX 3110 3130 3100 3200 3310 3320 3350 3300 3410 3420 3400 3XXX	Asset Current asset Cash and cash equivalents (notes 4 and 6) Current financial assets at fair value through profit or loss (notes 4, 7 and 18) Notes receivable, net (notes 4 and 10) Accounts receivable, net (notes 4, 5 and 10) Accounts receivable due from related parties, net (notes 4, 5, 10 and 31) Other receivables (notes 4 and 10) Other receivables due from related parties (notes 4, 10 and 31) Current inventories (notes 4, 5 and 11) Other current assets (note 16) Total current assets Non-current assets Non-current financial assets at fair value through other comprehensive income (notes 4 and 9) Financial assets measured at cost after amortization - non-current (notes 4, 8 and 32) Investment under the equity method (note 4 and 12) Property, plant and equipment (notes 4, 13, 17 and 32) Right-of-use assets (notes 4 and 14) Other intangible assets, net (notes 4 and 15) Deferred tax assets (notes 4 and 26) Other non-current assets, others (note 10 and 16) Total non-current assets Total assets Liabilities and equity Current liabilities Current borrowings (note 17) Accounts payable (note 19) Accounts payable to related parties (notes 19 and 31) Other payables (note 20) Other payables to related parties (note 31) Current tax liabilities (notes 4 and 26) Current provisions (notes 4 and 21) Current lease liabilities (notes 4 and 14) Long-term liabilities, current portion (notes 13, 17 and 32) Other current liabilities, others (note 20) Total current liabilities Non-current liabilities Bonds payable (notes 4, 18 and 32) Non-current portion of non-current borrowings (notes 13, 17 and 32) Deferred tax liabilities (notes 4 and 26) Non-current lease liabilities (notes 4 and 14) Net defined benefit liability, non-current (notes 4 and 22) Other non-current liabilities, others (note 20) Total non-current liabilities Total liabilities Equity (notes 4, 9, 18, 22, 23 and 26) Share capital Common stock Certificate of entitlement to new shares from convertible bond Total Share Capital Capital surplus Retained earnings Legal reserve Special reserve Unappropriated retained earnings (accumulated deficit) Total retained earnings Other equity interest Exchange differences on translation of foreign financial statements Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income Total other equity interest Total equity Total liabilities and equity		December 31,2020 Amount % $ 162,199 6 560 - 18,402 1 153,514 6 95,924 4 19,552 1 25,189 1 145,747 6 18,855 1 639,942 26 - - 76 - 1,256,185 52 496,302 20 1,433 - 7,570 - 34,147 2 6,852 - 1,802,565 74 $ 2,442,507 100 $ 293,000 12 142,454 6 17,293 1 85,872 3 - - - - 1,046 - 739 - 110,851 4 22,017 1 673,272 27 261,082 11 244,602 10 79,806 3 301 - 42,491 2 186 - 628,468 26 1,301,740 53 893,857 37 12,143 - 906,000 37 48,570 2 125,834 5 95,226 4 75,916 3 296,976 12 98,193 ) ( 4 ) 12,586) - 110,779) ( 4) 1140767 47 $ 2,442,507 100		December 31,2019	December 31,2019
			Amount $ 162,199 560 18,402 153,514 95,924 19,552 25,189 145,747 18,855 639,942 - 76 1,256,185 496,302 1,433 7,570 34,147 6,852 1,802,565 $ 2,442,507 $ 293,000 142,454 17,293 85,872 - - 1,046 739 110,851 22,017 673,272 261,082 244,602 79,806 301 42,491 186 628,468 1,301,740 893,857 12,143 906,000 48,570 125,834 95,226 75,916 296,976 98,193 ) 12,586) 110,779) 1140767 $ 2,442,507		Amount $ 125,911 - 17,748 161,844 96,040 8,758 40,185 165,269 10,529 626,284 3,586 20,000 1,191,731 493,872 3,009 5,288 30,180 6,424 1,754,090 $ 2,380,374 $ 281,797 140,087 9,470 77,479 72 5,961 1,666 1,505 47,319 36,681 602,037 283,058 298,674 63,241 1,040 41,736 211 687,960 1,289,997 885,767 1,027 886,794 68,494 121,416 54,831 54,068 230,315 86,226 ) 9,000) 95,226) 1,090,377 $ 2,380,374	%
		( ( (		( ( (		5 - 1 7 4 - 2 7 - 26 - 1 50 21 - - 1 1 74 100 12 6 - 3 - - - - 2 2 25 12 12 3 - 2 - 29 54 37 - 37 3 5 3 2 10 ( 4 ) - ( 4) 46 100

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

(With Deloitte & Touche review report dated March 31, 2021)

Chairman: Hsiang-Chih Hsiao Manager: Hsiang-Chih Hsiao Accounting Supervisor: Chih-Wen Kao

Tex Year Industries Inc.

Individual Statement of Comprehensive Income

January 1 to December 31, 2020 and 2019

Code Operating revenue (notes 4, 24 and 31) 4110 Sales revenue 4170 Less: sales return 4190 Less: sales discounts and allowances 4000 Total operating revenue Operating costs (notes 4, 5, 11, 21, 22, 25 and 31) 5110 Total cost of sales 5900 Gross profit from operations 5910 Unrealized profit from sales (note 4) 5950 Gross profit from operations Operating expenses (notes 4, 5, 10, 15, 22, 25 and 31) 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses 6000 Total operating expenses 6900 Net operating loss	2020		% 100 - - 100 79 21 - 21 10 6 6 22 1)	In thousand of New Taiwan Dollars, Except earnings per share 2019 Amount % $ 1,449,671 100 ( 1,555 ) - ( 1,949) - 1,446,167 100 1,159,202 80 286,965 20 12 - 286,977 20 136,575 9 71,195 5 79,450 6 287,220 20 ( 243) -	In thousand of New Taiwan Dollars, Except earnings per share 2019 Amount % $ 1,449,671 100 ( 1,555 ) - ( 1,949) - 1,446,167 100 1,159,202 80 286,965 20 12 - 286,977 20 136,575 9 71,195 5 79,450 6 287,220 20 ( 243) -
	Amount $ 1,253,450 ( 1,649 ) ( 725) 1,251,076 988,901 262,175 559 262,734 124,446 74,946 79,009 278,401 ( 15,667)			Amount $ 1,449,671 ( 1,555 ) ( 1,949) 1,446,167 1,159,202 286,965 12 286,977 136,575 71,195 79,450 287,220 ( 243)
		(

(Continue)

Code Non-operating income and expenses 7060 Share of profit of associates and joint ventures accounted for using equity method, net (notes 4 and 12) 7100 Interest income (notes 4 and 25) 7010 Other income (notes 4, 25, 28 and 31) 7020 Other gains and losses, net (notes 4 and 25) 7510 Finance costs (notes 4, 17, 18 and 25) 7590 Miscellaneous disbursements 7630 Foreign exchange losses (note 4 and 34) 7000 Total non-operating income and expenses 7900 Profit from continuing operations before tax 7950 Income tax expense (notes 4 and 26) 8200 Profit Other comprehensive income (loss) (notes 4, 9, 12, 22 and 26) Components of other comprehensive income that will not be reclassified to profit or loss	2020	% 7 - 2 - ( 1 ) - ( 1) 7 6 - 6	2019
	Amount $ 84,170 896 31,838 532 ( 12,729 ) ( 3,572 ) ( 8,721) 92,414 76,747 7,007 69,740		Amount $ 33,607 1,059 41,602 ( 26 ) ( 11,612 ) ( 4,258 ) ( 6,471) 53,901 53,658 9,476 44,182	%
				2 - 3 - ( 1 ) - - 4 4 1 3

(Continue)

Code 8311 Gains (losses) on remeasurement s of defined benefit plans 8316 Unrealised gains (losses) from investments in equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8310 Components of other comprehensive income that will not be reclassified to profit or loss 8361 Exchange differences on translation (Continue)	2020	% ( 1 ) - - ( 1) ( 1 )	2019
	Amount ( $ 3,849 ) ( 3,586 ) 770 ( 6,665) ( 12,612 )		Amount $ 3,793 ( 3,000 ) ( 758) 35 ( 46,783 )		%
				- - - - ( 3 )

(Continue)

(Continue)
Code 8370 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss 8360 8300 Total other comprehensive income 8500 Total comprehensive income Earnings per Share (note 27) 9710 Basic 9810 Dilute	2020		% - - 1) 2) 4	2019
	Amount ($ 2,347 ) 2,992 ( 11,967) ( 18,632) $ 51,108 $ 0.78 $ 0.68			Amount ( $ 917 ) 10,305 ( 37,395) ( 37,360) $ 6,822 $ 0.50 $ 0.44		%
		( (			( (	- - 3) 3) -

The accompanying notes are an integral part of the individual financial statements. (With Deloitte & Touche review report dated March 31, 2021)

Chairman: Hsiang-Chih Hsiao Manager: Hsiang-Chih Hsiao Accounting Supervisor: Chih-Wen Kao

Tex Year Industries Inc.

Individual Statement of Changes in Equity

In thousand of New Taiwan Dollars

January 1 to December 31, 2020 and 2019

Share capital Common stock Certificates of rights to exchange bonds for shares (notes 4 and 23) (notes 4 and 18) $ 885,767 $ - - - - - - - - 1,027 - - - - - - - - 885,767 1,027 - - - - - - 7,063 12,143 1,027 ( 1,027 ) - - - - - - $ 893,857 $ 12,143	Share capital Common stock Certificates of rights to exchange bonds for shares (notes 4 and 23) (notes 4 and 18) $ 885,767 $ - - - - - - - - 1,027 - - - - - - - - 885,767 1,027 - - - - - - 7,063 12,143 1,027 ( 1,027 ) - - - - - - $ 893,857 $ 12,143	Capital from retained earnings (notes 4 and 18 and 23) $ 55,269 - - - 472 12,753 - - - 68,494 - - ( 26,753 ) 6,829 - - - - $ 48,570	Retained earnings(notes 4,9,22,23 and 26) Legal reserve Special reserve Undistributed earnings $ 118,299 $ 34,527 $ 43,559 3,117 - ( 3,117 ) - 20,304 ( 20,304 ) - - ( 13,287 ) - - - - - - - - 44,182 - - 3,035 - - 47,217 121,416 54,831 54,068 4,418 - ( 4,418 ) - 40,395 ( 40,395 ) - - - - - - - - - - - 69,740 - - ( 3,079) - - 66,661 $ 125,834 $ 95,226 $ 75,916	Retained earnings(notes 4,9,22,23 and 26) Legal reserve Special reserve Undistributed earnings $ 118,299 $ 34,527 $ 43,559 3,117 - ( 3,117 ) - 20,304 ( 20,304 ) - - ( 13,287 ) - - - - - - - - 44,182 - - 3,035 - - 47,217 121,416 54,831 54,068 4,418 - ( 4,418 ) - 40,395 ( 40,395 ) - - - - - - - - - - - 69,740 - - ( 3,079) - - 66,661 $ 125,834 $ 95,226 $ 75,916	Retained earnings(notes 4,9,22,23 and 26) Legal reserve Special reserve Undistributed earnings $ 118,299 $ 34,527 $ 43,559 3,117 - ( 3,117 ) - 20,304 ( 20,304 ) - - ( 13,287 ) - - - - - - - - 44,182 - - 3,035 - - 47,217 121,416 54,831 54,068 4,418 - ( 4,418 ) - 40,395 ( 40,395 ) - - - - - - - - - - - 69,740 - - ( 3,079) - - 66,661 $ 125,834 $ 95,226 $ 75,916	Others Equity (notes 4,9 and 26) Unrealised losses on financial assets measured at fair value through other comprehensive income Foreign operating institute Translation of financial statements Exchange differences ( $ 48,831 ) ( $ 6,000 ) - - - - - - - - - - - - ( 37,395) ( 3,000) ( 37,395) ( 3,000) ( 86,226 ) ( 9,000 ) - - - - - - - - - - - - ( 11,967) ( 3,586) ( 11,967) ( 3,586) ($ 98,193) ($ 12,586)	Others Equity (notes 4,9 and 26) Unrealised losses on financial assets measured at fair value through other comprehensive income Foreign operating institute Translation of financial statements Exchange differences ( $ 48,831 ) ( $ 6,000 ) - - - - - - - - - - - - ( 37,395) ( 3,000) ( 37,395) ( 3,000) ( 86,226 ) ( 9,000 ) - - - - - - - - - - - - ( 11,967) ( 3,586) ( 11,967) ( 3,586) ($ 98,193) ($ 12,586)		Total equity
						Foreign operating institute Translation of financial statements Exchange differences ( $ 48,831 ) - - - - - - ( 37,395) ( 37,395) ( 86,226 ) - - - - - - ( 11,967) ( 11,967) ($ 98,193)
Common stock (notes 4 and 23) $ 885,767 - - - - - - - - 885,767 - - - 7,063 1,027 - - - $ 893,857
			Legal reserve $ 118,299 3,117 - - - - - - - 121,416 4,418 - - - - - - - $ 125,834	Special reserve $ 34,527 - 20,304 - - - - - - 54,831 - 40,395 - - - - - - $ 95,226
	(	(			( ( ( ( ( (	( ( ( ( ( ( (	( ( ( ( ( ( (	( ( ( (	$ 1,082,590 - - 13,287 ) 1,499 12,753 44,182 37,360) 6822 1,090,377 - - 26,753 ) 26,035 - 69,740 18,632) 51,108 $ 1,140,767

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

(With Deloitte & Touche review report dated March 31, 2021)

Chairman: Hsiang-Chih Hsiao Manager: Hsiang-Chih Hsiao Accounting Supervisor: Chih-Wen Kao

Tex Year Industries Inc.

Individual Cash Flow Statement

January 1 to December 31, 2020 and 2019

In thousand of New Taiwan Dollars

Code Cash flow from business activities A00010 Profit from continuing operations before tax A20010 Adjustments to reconcile profit (loss) A20100 Depreciation expense A20200 Amortization expense A20300 Expected credit loss A20900 Finance costs A21200 Interest income A22300 Share of loss (profit) of associates and joint ventures accounted for using equity method A22500 Loss (gain) on disposal of property, plan and equipment A23700 Impairment loss on non-financial assets A23900 Unrealized profit (loss) from sales A24100 Unrealized foreign exchange loss (gain) A29900 Other adjustments to reconcile profit (loss) A30000 Changes in operating assets and liabilities A31115 Financial assets at fair value through profit or loss, mandatorily measured at fair value A31130 Notes receivable A31150 Accounts receivable A31160 Accounts receivable due from related parties A31180 Other receivable	2020 $ 76,747 31,560 2,415 7,721 12,729 ( 896 ) ( 84,170 ) 28 2,516 ( 559 ) 2,508 ( 620 ) ( 560 ) ( 654 ) ( 677 ) ( 1,615 ) ( 10,840 )	2019
		$ 53,658 27,810 2,151 4,723 11,612 ( 1,059 ) ( 33,607 ) ( 4 ) 458 ( 12 ) 3,559 899 30 14,164 20,016 ( 1,519 ) ( 533 )

(Continue)

Code A31190 Other receivable due from related parties A31200 Inventories A31240 Other current assets A32130 Notes payable A32150 Accounts payable A32160 Accounts payable to related parties A32180 Other payable A32190 Other payable to related parties A32230 Decrease in other current liabilities A32240 Net defined benefit liability – non-current A33000 Cash inflow generated from operations A33100 Interest received A33300 Interest paid A33500 Income taxes refund (paid) AAAA Net cash flows from (used in) operating activities Cash flows from (used in) investing activities B00040 Acquisition of financial assets at amortised cost B00050 Proceeds from disposal of financial assets at amortised cost B02700 Acquisition of property, plant and equipment B02800 Proceeds from disposal of property, plant and equipment B03700 Increase (decrease) in refundable deposits B04500 Acquisition of intangible assets B06700 Increase (decrease) in other non-current assets B07100 Prepayments for business facilities B07600 Dividends received BBBB Net cash flows from (used in) investing activities (Continue)	2020 $ 14,991 17,006 ( 8,326 ) - 2,568 8,135 17,027 ( 72 ) ( 11,247 ) ( 2,324) 73,391 943 ( 8,259 ) 2,622 68,697 - 19,924 ( 40,300 ) - ( 1,700 ) ( 4,051 ) ( 469 ) ( 3,509 ) 5,316 ( 24,789)	2019
		$ 14,403 3,005 6,450 ( 10 ) ( 38,737 ) 4,141 ( 63,755 ) - 54,298 ( 3,735) 78,406 995 ( 8,255 ) ( 9,835) 61,311 ( 20,000 ) - ( 94,325 ) 81 3,429 ( 2,970 ) 2,094 ( 3,611 ) 23,199 ( 92,103)

(Continue)

Code Cash flows from (used in) financing activities C00100 Increase in short-term loans C01300 Repayments of bonds C01200 Proceeds from issuing bonds C01600 Proceeds from long-term debt C01700 Repayments of long-term debt C04020 Payments of lease liabilities C04400 Decrease in other non-current liabilities C05400 Acquisition of ownership interests in subsidiaries C04500 Cash dividends paid CCCC Net cash flows from (used in) financing activities EEEE Net increase in cash and cash equivalents E00100 Cash and cash equivalents at beginning of period E00200 Cash and cash equivalents at end of period	2020 $ 11,203 - - 60,000 ( 50,541 ) ( 1,504 ) ( 25 ) - ( 26,753) ( 7,620) 36,288 125,911 $ 162,199	2019
		$ 51,500 ( 248,500 ) 295,000 123,700 ( 130,944 ) ( 1,662 ) ( 24 ) ( 19,533 ) ( 13,287) 56,250 25,458 100,453 $ 125,911

The accompanying notes are an integral part of the individual financial statements. (With Deloitte & Touche review report dated March 31, 2021)

Chairman: Hsiang-Chih Hsiao Manager: Hsiang-Chih Hsiao Accounting Supervisor: Chih-Wen Kao

Tex Year Industries Inc.

Notes to Individual Financial Statements

January 1 to December 31, 2020 and 2019

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

1. Company History and Business Scope

Tex Year Industries Inc. (hereinafter referred to as the “Company”) was established on June 28, 1976 with the approval of the Ministry of Economic Affairs. The main business items are the manufacturing and trading of glues, adhesives, hot-melt glues and medical equipment.

The Company’s shares were listed and traded on the Taipei Exchange (OTC) Securities Market of the Republic of China on March 16, 2001, and delisted on the Taipei Exchange (OTC) Securities Market on June 24, 2015 and listed and traded on the Taiwan Stock Exchange on the same day.

The individual financial statements are expressed in NT$, the functional currency of the Company.

2. Date and Procedure of Adoption of Financial Statements

The individual financial statements were adopted and issued by the board of directors on March 26, 2021.

3. Application of New and Revised Standards and Interpretations

(1) The International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), Interpretations (IFRIC) and Interpretations (SIC) (hereinafter referred to as “IFRSs”) recognized and issued by the Financial Supervisory Commission (hereinafter referred to as the “FSC”) are applied for the first time.

The application of the revised IFRSs approved and issued by the FSC will not result in significant changes in the accounting policies of the Company.

(2) IFRSs approved by the FSC applicable in 2021

New/amended/revised criteria and Effective date of IASB inter retation release p Amendments to IFRS 4, “Deferral of Effective Effective from the date Date of IFRS 9” of release

New/amended/revised criteria and Effective date of IASB inter retation release p Revised “Interest rate indicator reform - Phase Effective for annual 2” of IFRS 9, IAS 39, IFRS 7, IFRS 4, and IFRS reporting periods 16 beginning after January 1, 2021 Amendment to IFRS 16 “Reduction of rent Effective for annual associated with COVID-19". reporting periods beginning after June 1, 2020

“ Amendment to IFRS 16 Reduction of rent associated with COVID-19"

The amendment to IFRS 16, “Reduction of rent associated with COVID-19,” provides that if the Company enters into a lease agreement with a lessor directly related to COVID-19, when certain conditions are met, the Company may elect the practical expedient to recognize a reduction in lease payments in profit or loss upon the occurrence of the reduction event or circumstance, and to reduce the lease liability accordingly.

The Company did not have the aforementioned related rental agreements in 2020, but would have elected to apply the aforementioned provisions if such agreements had occurred in 2021.

As of the date of adoption of this consolidated financial report, the Company assesses that the above-mentioned amendments to standards and interpretations will not have a material impact on the financial position and financial performance.

(3) IFRSs issued by IASB but not approved and effective by the FSC

New/amended/revised criteria and Effective date of IASB interpretation release (note 1) “Annual Improvements to IFRS Standards January 1, 2022 (Note 2) 2018–2020” Amendments to IFRS 3, “Update a Reference to January 1, 2022 (Note 3) the Conceptual Framework” Amendments to IFRS 10 and IAS 28 “Sale or Undetermined investment of assets between investors and their affiliates or joint ventures” IFRS 17 “Insurance contracts” January 01, 2023 Amendments to IFRS 17 January 01, 2023 Amendment to IAS 1 “Classification of liabilities January 01, 2023 as current or non-current” Amendments to IAS 16, “Property, Plant and January 1, 2023 (Note 6) Equipment: Proceeds before Intended Use”

New/amended/revised criteria and Effective date of IASB interpretation release (note 1) Amendments to IAS 8, “Definition of January 1, 2023 (Note 7) Accounting Estimates” Amendments to IAS 16, “Property, Plant and January 1, 2022 (Note 4) Equipment: Proceeds before Intended Use” Amendments to IAS 37, “Onerous Contracts — January 1, 2022 (Note 5) Cost of Fulfilling a Contract”

Note 1: Unless otherwise noted, the above-mentioned new/ amended/ revised standards or interpretations shall come into effect during the annual reporting period starting after that date.
Note 2: The amendments to IFRS 9 are applicable to exchanges related to financial liabilities and modifications in terms/conditions incurring during annual reporting periods beginning on or after January 1, 2022. The amendments
to IAS 41 “Agriculture” are applicable to fair value measurement incurring during annual reporting periods beginning on or after January 1, 2022. The amendments to IFRS 1 “First-time Adoption of International Financial Reporting Standards (IFRSs)” are applicable retroactively for annual reporting periods beginning on or after January 1, 2022.
Note 3: The amendments are applicable to business combinations of which the acquisition date falls in annual reporting periods beginning on or after January 1, 2022.
Note 4: The amendments are applicable to such plant, property and equipment of which the location and condition is capable of operating in a manner required necessarily by the management on or after January 1, 2021.
Note 5: The amendments are applicable to contracts for which no obligations have been fulfilled until January 1, 2022.
Note 6: The application of this amendment is deferred for annual reporting periods beginning after January 1, 2023.

Note 7: This amendment applies to changes in accounting estimates and changes in accounting policies that occur in annual reporting periods beginning after January 1, 2023.

Amendment to IAS 1 “Classification of liabilities as current or non-current”

The amendment is to determine whether the Company has the right to defer settlement until at least 12 months after the reporting period when determining whether a liability is classified as noncurrent. If the Company has such a right at the end of the reporting period, the liability is classified as noncurrent, regardless of whether the Company expects to exercise the right. The amendment also clarifies that if the Company is required to comply with certain conditions in order to have the right to defer settlement of its liabilities, the Company must have complied with the specified conditions as of the end of the reporting period, even if the lender tests whether the Company has complied with those conditions at a later date.

The amendment provides that for the purpose of liability classification, the aforementioned settlement refers to the extinguishment of a liability resulting from the transfer of cash, other economic resources or equity instruments of the company to the counterparty. If the terms of the liability may, at the option of the counterparty, result in the settlement of the equity instrument of the company, and if the option is separately recognized in equity in accordance with IAS 32, "Financial Instruments: Presentation," the foregoing provisions do not affect the classification of the liability.

2. Amendments to IAS 1, “Definition of Accounting Policies”

The amendment specifies that the Company shall determine the significant accounting policy information to be disclosed based on the definition of materiality. Accounting policy information is material if it could reasonably be expected to affect the decisions of the primary users of the general-purpose financial statements based on those financial statements. The amendment also clarifies.

Accounting policy information related to immaterial transactions or other events or circumstances is immaterial and the Company is not required to disclose such information.
The Company may determine that relevant accounting policy information is material because of the nature of the transaction or other event or circumstance, even if the amount is not material.
Not all accounting policy information related to significant transactions or other events or circumstances is material.
In addition, the amendment also provides examples of accounting
policy information that may be material if it relates to a significant transaction or other event or circumstance and if
(1) The Company changes its accounting policy during the reporting period and the change results in a material change in financial statement information.
(2) The Company selects its applicable accounting policy from among the options permitted by the standard.
(3) The accounting policies established by the Company in accordance with IAS 8, "Accounting Policies, Changes in Accounting Estimates and Errors" due to the lack of specific standards.
(4) the Company discloses the relevant accounting policies that require the application of significant judgments or assumptions; or
(5) involves complex accounting requirements and users of the financial statements rely on such information to understand such significant transactions or other events or circumstances.
Amendments to IAS 8, “Definition of Accounting Estimates”

The revised explicit accounting estimate represents the monetary amounts in the financial statements that are subject to measurement uncertainty. In applying accounting policies, the Company may need to measure financial statement items using monetary amounts that are not directly observable but must be estimated, and therefore measurement techniques and inputs are required to create accounting estimates for this purpose. The effect of changes in measurement techniques or

inputs on accounting estimates that are not corrections of prior period errors are changes in accounting estimates.

As of the date of issuance of the consolidated financial statements, the company has continued to evaluate the impact of the amendments to the above standards and interpretations on the financial position and financial performance, and the relevant impact will be disclosed when the assessment is completed.

4. Summary of Significant Accounting Policies

(1) Declaration of Compliance

The individual financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs approved and issued by the FSC.

(2) Basis of Preparation

In addition to financial instruments measured at fair value and net defined benefit liabilities recognized at the present value of defined benefit obligations less the fair value of planned assets, the individual financial statements are prepared based on historical cost.

Fair value measurement is divided into levels 1 to 3 according to the observability and importance of relevant input values:

Level 1 input value: refers to the quoted price (unadjusted) of the same assets or liabilities available in the active market on the measurement date.
Level 2 input value: refers to the directly (i.e. price) or indirectly (i.e. derived from price) observable input value of assets or liabilities other than the quotation of level 1.
Level 3 input value: refers to the unobservable input value of assets or liabilities.

The Company uses the equity method to account for its investment in subsidiaries or joint ventures in preparing its individual financial statements. In order to make the profit or loss for the year, other comprehensive income and equity in the individual financial statements the same as the profit or loss for the year, other comprehensive income and equity attributable to the owners of the Company in the consolidated financial statements, certain

accounting differences between the individual basis and the consolidated basis are adjusted for "investments accounted for using the equity method", "share of profit or loss of subsidiaries and joint ventures accounted for using the equity method", "share of other comprehensive income of subsidiaries and joint ventures accounted for using the equity method" and related equity items. The "share of profit or loss of subsidiaries and joint ventures using the equity method" and the related equity items.

(3) Criteria for distinguishing between current and non-current assets and liabilities

Current assets include:

Assets held primarily for trading purposes.
Assets expected to be realized within 12 months of the balance sheet date; and
Cash and cash equivalents (other than those restricted from being exchanged or settled more than 12 months after the balance sheet date).

Current liabilities include:

Liabilities held primarily for trading purposes.
Liabilities due for settlement within 12 months of the balance sheet date, and
Liabilities that cannot be unconditionally deferred until at least 12 months after the balance sheet date.

Current assets or liabilities that are not classified as current assets or liabilities are classified as non-current assets or non-current liabilities.

(4) Foreign Currency

When preparing the individual financial statements, each individual is recorded in a currency other than the individual's functional currency (foreign currency) and is translated into the functional currency based on the exchange rate on the transaction date.

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

Non-monetary items denominated in foreign currencies that are measured at historical cost are translated at the exchange rates prevailing on the dates of transactions and are not retranslated.

For the purpose of preparing individual financial statements, the assets and liabilities of the Company and its foreign operations (including subsidiaries or joint ventures that operate in countries or currencies different from those of the Company) are translated into New Taiwan Dollars at the exchange rates prevailing on each balance sheet date. Income and expense items are translated at average exchange rates for the period, with the resulting exchange differences recorded in other comprehensive income.

(5) Inventory

Inventory includes raw materials, supplies, finished goods and work-in-process. Inventories are measured at the lower of cost or net realizable value. Comparisons between cost and net realizable value are made on an item-by-item basis, except for inventories of the same type. The net realizable value is the estimated selling price under normal circumstances less the estimated costs still to be invested to completion and the estimated costs required to complete the sale. The cost of inventories is calculated using the weighted-average method.

(6) Invested subsidiaries

The Company uses the equity method to account for its investment in subsidiaries.

A subsidiary is an entity over which the Company has control.

Under the equity method, investments are initially recognized at cost, and the carrying amount is increased or decreased as the company’s share of the subsidiaries and other comprehensive income or loss and profit is distributed. In addition, changes in the Company’s other interests in subsidiaries are recognized in proportion to the Company’s shareholding.

Where the change of ownership rights of the subsidiaries of the Company does not result in a loss of control, it shall be treated as an equity transaction. The difference between the carrying amount of the investment and the fair value of the consideration paid or received is recognized directly in equity.

When the Company’s share of losses in a subsidiary equals or exceeds its interest in the subsidiary (including the carrying amount of the subsidiary under the equity method and other long-term interests that are in substance a component of the Company’s net investment in the subsidiary), the Company continues to recognize losses in proportion to its equity in the subsidiary.

The excess of the acquisition cost over the Company’s share of the net fair value of the identifiable assets and liabilities of the subsidiaries constituting the business at the acquisition date is recorded as goodwill, which is included in the carrying amount of the investment and is not amortized; the excess of the Company’s share of the net fair value of the identifiable assets and liabilities of the subsidiaries constituting the business at the acquisition date over the acquisition cost is recorded as current income.

The Company assesses impairment by considering the cash-generating units as a whole and comparing their recoverable amounts with their carrying amounts in the financial statements. If the recoverable amount of an asset subsequently increases, the reversal of the impairment loss is recognized as a gain, provided that the carrying amount of the asset after the reversal of the impairment loss does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset, less amortization. Impairment losses attributable to goodwill are not reversed in subsequent periods.

When control over a subsidiary is lost, the Company measures its remaining investment in the former subsidiary at fair value at the date of loss of control. The difference between the fair value of the remaining investment and the carrying amount of the investment at the date of loss of control, if any, is recognized in profit or loss for the period. In addition, all amounts recognized in other comprehensive income or loss related to the subsidiary are accounted for on the same basis as if the Company had directly disposed of the related assets or liabilities.

Unrealized gains or losses on downstream transactions with subsidiaries are eliminated in the individual financial statements. Gains or losses resulting from counter-current and side-stream transactions with

subsidiaries are recognized in the individual financial statements only to the extent that they are not related to the Company’s interest in the subsidiary.

(7) Joint ventures

A joint venture is a joint agreement between the Company and another company with joint control and rights to the net assets.

The Company applies the equity method to investment joint ventures.

Under the equity method, investments in joint ventures are initially recognized at cost, and the carrying amount is increased or decreased as the Company's share of the joint ventures and other comprehensive income or loss and profit is distributed. In addition, changes in the Company’s equity interest are recognized in proportion to the Company’s shareholding.

The excess of the acquisition cost over the Company's share of the net fair value of the identifiable assets and liabilities is recorded as goodwill, which is included in the carrying amount of the investment and is not amortized; the excess of the Company's share of the net fair value of the identifiable assets and liabilities over the acquisition cost is recorded as profit or loss for the period.

If the Company does not subscribe for new shares in proportion to its shareholding in a joint venture, resulting in a change in its shareholding and a resulting increase or decrease in the net equity of the investment, the increase or decrease is adjusted to capital surplus - change in net equity of the joint venture recognized under the equity method and the investment accounted for under the equity method. However, if the ownership interest in a joint venture is reduced as a result of not subscribing or acquiring shares in proportion to the ownership interest, the amount recognized in other comprehensive income or loss related to the joint venture is reclassified in proportion to the reduction, and the accounting treatment is based on the same basis as that required for a direct disposal of the related assets or liabilities. The difference is debited to retained earnings.

The recognition of further losses ceases when the Company's share of losses in a joint venture equals or exceeds its interest in the joint venture (including the carrying amount of the investment in the joint venture under the equity method and other long-term interests that are in substance a

component of the Company's net investment in the joint venture). The Company recognizes additional losses and liabilities only to the extent that legal obligations, constructive obligations or payments made on behalf of the Consolidated Company are incurred.

In assessing impairment, the Company treats the entire carrying amount of an investment (including goodwill) as a single asset for the purpose of impairment testing by comparing the recoverable amount with the carrying amount. Any reversal of the impairment loss is recognized to the extent of the subsequent increase in the recoverable amount of the investment.

When the Company ceases to adopt the equity method from the date its investment ceases to be a joint venture, its retained interest in the original joint venture is measured at fair value, and the difference between such fair value and the disposal price and the carrying amount of the investment on the date it ceases to adopt the equity method is recognized in profit or loss for the current period. In addition, all amounts recognized in other comprehensive income or loss related to the joint venture are accounted for on the same basis as would be required if the joint venture were directly disposed of as a related asset or liability. If an investment in a joint venture becomes an investment in an affiliate, the Company continues to use the equity method without remeasuring the retained interest.

Gains or losses resulting from counter-current, downstream and side-stream transactions between the Company and the joint venture are recognized in the individual financial statements only to the extent that they are not related to the Company's interest in the joint venture.

(8) Property, plant and equipment

Property, plant and equipment are recognized at cost and subsequently measured at cost less accumulated depreciation and accumulated impairment losses.

Property, plant and equipment under construction are recognized at cost less accumulated impairment losses. Costs include fees for professional services and borrowing costs that qualify for capitalization. Upon completion and attainment of their intended use, these assets are classified into the

appropriate categories of property, plant and equipment and depreciation is commenced.

Except for land owned by the Company, which is not depreciated, property, plant and equipment are depreciated separately over their useful lives on a straight-line basis for each significant component. The Company reviews the estimated useful lives, residual values and depreciation methods at least at the end of each year and defers the effect of changes in applicable accounting estimates.

When property, plant and equipment are derecognized, the difference between the net disposal price and the carrying amount of the assets is recognized in profit or loss.

(9) Intangible assets

1. Single acquisition

Individually acquired intangible assets with finite useful lives are initially measured at cost and subsequently measured at cost less accumulated amortization and accumulated impairment losses. Intangible assets are amortized on a straight-line basis over their useful lives. The Company reviews the estimated useful lives, residual values and amortization methods at least at each year-end and defers the effect of changes in applicable accounting estimates.

2. Derecognition

When property, plant and equipment are derecognized, the difference between the net disposal price and the carrying amount of the assets is recognized in profit or loss.

(10) Impairment loss of property, plant and equipment, right-of-use assets and intangible assets

The Company assesses at each balance sheet date whether there is any indication that property, plant and equipment, right-of-use assets and intangible assets may have been impaired. If any indication of impairment exists, the recoverable amount of the asset is estimated. If the recoverable amount of an individual asset cannot be estimated, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

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 less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount, and the impairment loss is recognized in profit or loss.

When an impairment loss is subsequently reversed, the carrying amount of the asset or cash-generating unit is increased to the revised recoverable amount, provided that the increased carrying amount does not exceed the carrying amount (net of amortization or depreciation) that would have been determined if the impairment loss had not been recognized in prior years for that asset or cash-generating unit. Reversal of impairment loss is recognized in profit or loss.

(11) Financial Instruments

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

When financial assets and financial liabilities are recognized at fair value through profit or loss, they are measured at fair value plus transaction costs directly attributable to the acquisition or issuance of the financial assets or financial liabilities. Transaction costs directly attributable to the acquisition or issuance of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

Financial assets

Regular transactions of financial assets are recognized and derecognized using trade date accounting.

(1) Type of measurements

The types of financial assets held by the Company are financial assets at fair value through profit or loss, financial assets at amortized cost, and investments in equity instruments at fair value through other comprehensive income.

A. Financial assets measure at fair value through income statement

Financial assets at fair value through profit or loss are mandatory financial assets measured at fair value through profit or loss. Financial assets that are mandatorily measured at fair value through profit or loss include investments in equity instruments not designated by the Company as measured at fair value through other comprehensive income or loss, and derivatives and fund beneficiary certificates that do not qualify for classification as measured at amortized cost or at fair value through other comprehensive income or loss.

Financial assets carried at fair value through profit or loss are measured at fair value. Dividends and interest generated are recognized in other income and interest income, respectively, and gains or losses arising from remeasurement are recognized in other gains and losses. For the determination of fair value, please refer to Note 29.

B. Financial assets measured at cost after amortization

The Company's investment financial assets are classified as financial assets carried at amortized cost if both of the following two conditions are met.

a. is held under an operating model in which financial assets are held for the purpose of receiving contractual cash flows; and
b. The terms of the contract generate cash flows on specific dates that are solely for the payment of principal and interest on the outstanding principal amount.

Financial assets carried at amortized cost (including cash and cash equivalents, notes receivable, accounts receivable and other receivables carried at amortized cost) are measured at amortized cost using the effective interest method to determine the total carrying amount less any impairment loss after initial recognition, with any foreign currency exchange gain or loss recognized in profit or loss.

Interest income is calculated by multiplying the effective interest rate by the total carrying amount of the financial assets, except for the following two cases.

a. Interest income on credit-impaired financial assets acquired or created is calculated by multiplying the credit-adjusted effective interest rate by the amortized cost of the financial assets.
b. For financial assets that are not acquired or impaired but subsequently become impaired, interest income should be computed by multiplying the effective interest rate by the amortized cost of the financial assets from the next reporting period after the impairment is applied.

Credit-impaired financial assets are those for which the issuer or the debtor has experienced significant financial difficulties, defaulted, or where it is probable that the debtor will declare bankruptcy or other financial reorganization, or where an active market for the financial assets has disappeared due to financial difficulties.

Cash equivalents include time deposits that are highly liquid, readily convertible into fixed deposits with minimal risk of changes in value within 3 months from the date of acquisition and are used to meet short-term cash commitments.

C. Investments in equity instruments measured at fair value through other comprehensive income

At initial recognition, the Company has an irrevocable option to designate investments in equity instruments that are not held for trading and for which contingent consideration is recognized by the acquirer of the non-business combination to be measured at fair value through other comprehensive income.

Investments in equity instruments measured at fair value through other comprehensive income are measured at fair value, with subsequent changes in fair value reported in other comprehensive income and accumulated in other equity. Upon

disposal of investments, the accumulated gains and losses are transferred directly to retained earnings and are not reclassified to profit or loss.

Dividends from investments in equity instruments measured at fair value through other comprehensive income or loss are recognized in profit or loss when the rights to receive payments from the Company are established, unless the dividends clearly represent a partial recovery of the cost of the investment.

(2) Impairment on financial assets

The Company assesses impairment losses on financial assets (including accounts receivable) measured at amortized cost based on expected credit losses at each balance sheet date.

Accounts receivable are recognized as an allowance for loss based on the expected credit loss over the period of survival. Other financial assets are first evaluated to determine whether there is a significant increase in credit risk since initial recognition. If there is no significant increase, an allowance for loss is recognized based on the expected credit loss over 12 months, and if there is a significant increase, an allowance for loss is recognized based on the expected credit loss over the remaining period.

Expected credit loss is a weighted average credit loss weighted by the risk of default. The 12-month expected credit loss represents the expected credit loss arising from possible defaults within 12 months after the reporting date of the financial instrument, and the ongoing expected credit loss represents the expected credit loss arising from all possible defaults during the expected life of the financial instrument.

For internal credit risk management purposes, the Company determines, without regard to the collateral held, that a default on a financial asset has occurred in the following circumstances.

A. There is internal or external information that indicates that the debtor is unlikely to be able to pay its debts.

B. If more than 60 days past due, unless there is reasonable and supportable information indicating that the basis for delayed default is more appropriate.

All impairment losses on financial assets are reversed by reducing the carrying amount through an allowance account.

(3) Derecognition on financial assets

The Company derecognizes financial assets only when the contractual rights to the cash flows from the financial assets lapse or when the financial assets have been transferred and substantially all the risks and rewards of ownership of the assets have been transferred to other enterprises.

The difference between the carrying amount of the financial asset and the consideration received is recognized in profit or loss when the financial asset is derecognized as a whole at amortized cost. When investments in equity instruments measured at fair value through other comprehensive income are derecognized as a whole, the cumulative gain or loss is transferred directly to retained earnings and is not reclassified to profit or loss.

2. Equity instrument

Debt and equity instruments issued by the Company are classified as financial liabilities or equity based on the substance of the contractual agreements and the definitions of financial liabilities and equity instruments.

Equity instruments issued by the Company are recognized at the acquisition price less direct issue costs.

The recapture of the Company's own equity instruments is recognized and deducted under equity. The purchase, sale, issuance or cancellation of the Company's own equity instruments is not recognized in profit or loss.

3. Financial liabilities

(1) Subsequent measurements

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

(2) Derecognition on financial assets

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

4. Convertible corporate bonds

The convertible bonds issued by the Company are classified as financial liabilities and equity in accordance with the substance of the contractual agreements and the definitions of financial liabilities and equity instruments, respectively, at the time of initial recognition.

On initial recognition, the fair value of the liability component is estimated using the prevailing market interest rate for a similar non-convertible instrument and is measured at amortized cost using the effective interest method until the date of conversion or maturity. The components of liabilities that are embedded in non-equity derivatives are measured at fair value.

The conversion right classified as equity is equal to the remaining amount of the fair value of the compound instrument as a whole less the fair value of the separately determined liability component, which is recognized in equity net of the income tax effect and is not subsequently measured. When the conversion right is exercised, the related liability component and the amount in equity will be transferred to equity and capital surplus - issue premium. If the conversion rights of convertible bonds are not exercised on the maturity date, the amount recognized in equity will be transferred to capital surplus - issue premium.

Transaction costs related to the issuance of convertible bonds are allocated to the liability (included in the carrying amount of the liability) and the equity component (included in equity) of the instrument in proportion to the total apportioned price. 5. Derivatives

The derivative instruments entered into by the Company are the sale/redemption rights of convertible bonds.

Derivatives are initially recognized at fair value upon entering into derivative contracts and subsequently remeasured at fair value at the balance sheet date, with gains or losses arising from subsequent measurements recognized directly in profit or loss. When the fair value of a derivative is positive, it is classified as a financial asset; when the fair value is negative, it is classified as a financial liability.

Derivatives that are embedded in asset master contracts within the scope of IFRS 9, "Financial Instruments", are used as a whole to determine the classification of financial assets. A derivative is considered to be a separate derivative if it is embedded in a master contract of an asset that is not within the scope of IFRS 9 (e.g., embedded in a master contract of a financial liability) and the embedded derivative meets the definition of a derivative, the risks and characteristics of which are not closely related to those of the master contract and the hybrid contract is not measured at fair value through profit or loss.

(12) Provision for liabilities

The amount recognized as provision for liabilities is the best estimate of the expense required to settle the obligation at the balance sheet date, taking into account the risk and uncertainty of the obligation. The provision for liabilities is measured as the discounted value of estimated cash flows to settle the obligation.

The warranty obligation to conform to the agreed-upon specifications is based on management's best estimate of the expenses required to settle the Company's obligations and is recognized as revenue from the related merchandise.

(13) Income recognition

The Company allocates the transaction price to each performance obligation after the performance obligation is identified in the customer contract and recognizes revenue when each performance obligation is satisfied.

Revenue from merchandise sales is mainly derived from sales of hot melt adhesive products. The Company recognizes revenue and accounts

receivable at the time of delivery of hot melt adhesive products to the customer's designated location/shipment, when the customer has the right to set the price and use the products and has the primary responsibility for re-selling the products and bears the risk of obsolescence.

Therefore, no revenue is recognized when the product is removed.

(14) Lease

The Company assesses whether a contract is (or contains) a lease at the contract inception date.

1. The Company as lessor

A lease is classified as a finance lease when the terms of the lease transfer substantially all the risks and rewards incidental to the ownership of the asset to the lessee. All other leases are classified as operating leases.

Under operating leases, lease payments, net of lease incentives, are recognized as income on a straight-line basis over the term of the relevant lease. The original direct cost incurred in acquiring an operating lease is added to the carrying amount of the subject asset and recognized as an expense on a straight-line basis over the lease term.

2. The Company as lessee

Right-of-use assets and lease liabilities are recognized at the lease commencement date for all leases, except for leases of low-value underlying assets to which the recognition exemption applies and short-term leases, where lease payments are recognized as expenses on a straight-line basis over the lease term.

The right-of-use asset is measured initially at cost (consisting of the original measurement amount of the lease liability, lease payments made prior to the commencement date of the lease less lease incentives received, original direct cost and estimated cost of restoration of the subject asset) and subsequently measured at cost less accumulated depreciation and accumulated impairment losses, and the remeasurement of the lease liability is adjusted. Right-of-use assets are presented separately in the consolidated balance sheet.

Right-of-use assets are depreciated on a straight-line basis from the commencement date of the lease to the earlier of the end of the useful life or the end of the lease term.

Lease liabilities are measured initially at the present value of lease payments, primarily fixed payments. Lease payments are discounted using the interest rate implied by the lease if it is readily recognizable. If the rate is not readily identifiable, the lessee's incremental borrowing rate is used.

Subsequently, the lease liabilities are measured at amortized cost basis using the effective interest method and interest expense is allocated over the lease term. If there is a change in future lease payments due to changes in the lease period or rates, the Company remeasures the lease liability and adjusts the right-of-use asset accordingly. However, if the carrying amount of the right-of-use asset is reduced to zero, the remaining remeasurement amount is recognized in profit or loss. Lease liabilities are presented separately in the individual balance sheet.

(15) Borrowing Cost

Borrowing costs directly attributable to the acquisition, construction or production of an asset that meets the criteria are included as part of the cost of the asset until substantially all of the activities necessary to bring the asset to its intended use or sale condition have been completed.

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

(16) Government subsidy

Government grants are recognized only when there is reasonable assurance that the Company will comply with the conditions attached to the government grant and that the grant will be received.

Government grants related to revenues are recognized as a reduction of related costs/other income on a systematic basis in the period in which the related costs for which they are intended to be reimbursed are recognized as expenses by the Company. Government grants that are contingent upon the Company's acquisition, construction or other acquisition of current assets are

recognized as depreciation or amortization expense on noncurrent assets and the grants are recognized in profit or loss over the useful lives of the assets.

Government grants are recognized in profit or loss in the period in which they become receivable if they are intended to compensate for expenses or losses already incurred or to provide immediate financial support to the Company and have no future related costs.

(17) Employee benefits

1. Short-term employee benefits

Short-term employee benefit-related liabilities are measured at the non-discounted amount expected to be paid in exchange for employee services.

2. Post-employment benefits

The defined contribution pension plan is an expense that recognizes the amount of pension benefits to be contributed during the employees' service period.

The defined benefit cost (including service cost, net interest and remeasurement) of the defined benefit pension plan is actuarially determined using the projected unit benefit method. Service cost and net interest on net defined benefit liabilities (assets) are recognized as employee benefit expense as incurred. Remeasurements (including actuarial gains and losses and return on plan assets, net of interest) are recognized in other comprehensive income as incurred and included in retained earnings, and are not reclassified to profit or loss in subsequent periods.

The net defined benefit obligation represents the deficit in the defined benefit pension plan.

(18) Income tax

Income tax expense is the sum of current income tax and deferred income tax.

1. Income tax of the current period

The Company determines the current income (loss) in accordance with the regulations of each income tax filing jurisdiction and calculates the income tax payable (recoverable) accordingly.

Income tax on undistributed earnings calculated in accordance with the ROC Income Tax Act is recognized in the year when the shareholders resolve to retain the earnings.

Adjustments to prior years' income tax payable are included in the current period's income tax.

Deferred income tax

Deferred income tax is computed on temporary differences between the carrying amounts of assets and liabilities and the tax basis of taxable income.

Deferred income tax liabilities are generally recognized for all taxable temporary differences, and deferred income tax assets are recognized to the extent that it is probable that taxable profit will be available against which income tax credits can be utilized for temporary differences.

Deferred income tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and joint agreements, except where the Company can control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax assets are recognized for deductible temporary differences associated with such investments only to the extent that it is probable that sufficient taxable income will be available to allow the temporary differences to be realized and to the extent that a reversal is expected in the foreseeable future.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient tax assets will be available to allow recovery of all or part of the asset. Deferred income tax assets that have not been recognized are reviewed at each balance sheet date and the carrying amount is increased to the extent that it is probable that future taxable income will be available to recover all or part of the asset.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the liability is

settled or the asset is realized, which are based on tax rates and tax laws that have been legislated or substantively legislated at the balance sheet date. The measurement of deferred income tax liabilities and assets reflects the tax consequences of the manner in which the Company expects to recover or settle the carrying amounts of its assets and liabilities at the balance sheet date.

Income tax of the current period and deferred income tax

Current and deferred income taxes are recognized in profit or loss, except for current and deferred income taxes related to items recognized in other comprehensive income or directly in equity, which are recognized in other comprehensive income or directly in equity, respectively.

Main Sources of Uncertainty in Significant Accounting Judgments, Estimates and Assumptions

In adopting accounting policies, the Company's management is required to make judgments, estimates and assumptions that are based on historical experience and other relevant factors when relevant information is not readily available from other sources. Actual results may differ from estimates.

The Company has taken the economic impact of the COVID-19 outbreak into consideration for significant accounting estimates, and management will review the estimates and underlying assumptions on an ongoing basis. If a revision of an estimate affects only the current period, it is recognized in the period in which it is revised. If a revision of an accounting estimate affects both the current and future periods, it is recognized in the period in which it is revised and in the future period.

Main Sources of Uncertainty in Estimates and Assumptions

(1) Estimated impairment loss on accounts receivable

The estimated impairment loss on accounts receivable is based on the company's assumptions about default rates and expected loss rates. The Company considers historical experience, current market conditions and forward-looking information to make assumptions and select the input value for the impairment assessment. Please refer to Note 10 for the significant

assumptions and inputs used. If actual future cash flows fall short of expectations, a material impairment loss could be incurred.

(2) Impairment of inventories

The net realizable value of inventories is the estimated selling price in the ordinary course of business less estimated costs to complete and estimated costs to complete the sale, which are based on current market conditions and historical sales experience of similar products.

6. Cash and cash equivalents

h and cash equivalents
Cash on hand and working capital Bank checks and demand deposits Cash equivalents Bank term deposits with original maturity in 3 months	December 31, 2020 $ 814 161,385 - $ 162,199	December 31, 2019
			$ 1,036 94,865 30,010 $ 125,911

The interest rate ranges of bank deposits on the balance sheet date are as follows:

follows:
Bank deposits Time deposit	December 31, 2020 0.01%~0.6% -	December 31, 2019
		0.01%~0.6% 2.05%

7. Financial instruments measure at fair value through income statement

Financial assets-current Mandatory adoption of fair value through profit or loss measured at Derivatives (not for specified hedging) - Call and redemption rights of convertible corporate bonds (note 18)	December 31, 2020 $ 560	December 31, 2019	December 31, 2019
			$ -

8. Financial assets measured at cost after amortization

Non-current Restricted bank deposits	December 31, 2020 $ 76	December 31, 2019	December 31, 2019
			$ 20,000

The restricted bank deposits are collaterals for the issuance of convertible bonds and applicable foreign currency.

Please refer to Note 32 for the repatriation of funds to foreign-currency deposits.

9. Financial assets measured at fair value through other comprehensive income

Equity instrument investment

Equity instrument investment
Non-current Domestic investment Unlisted (OTC) market Common shares of Acute Touch Technology Co., Ltd	December 31, 2020 $ -	December 31, 2019
			$ 3,586

The Company invests in the common shares of Acute Touch Technology

Co., Ltd. for medium and long-term strategic purposes, and expects to make profits through long-term investment. In the opinion of the management of the Company, if the short-term fair value fluctuation of such investment is included in the income, it is not consistent with the aforesaid long-term investment plan, so they chose to designate such investment as measured at fair value through other comprehensive income.

Considering the operation and net equity value of Acute Touch Technology Co., Ltd, the Company may have a significant impairment in the recoverable amount of its relevant investment, and after evaluation, it recognized the impairment loss of NT$3,586 thousand and NT$3,000 thousand in years of 2020 and 2019, respectively.

10. Notes receivable, accounts receivable and other receivables (including those of

related parties) Notes receivable Measured at cost after amortization Total book value Accounts receivable Measured at cost after amortization Total book value Less: provision for loss Accounts receivable-related parties Measured at cost after amortization Total book value Less: provision for loss Other receivable Tax refund receivable Others Other receivables - related party Less: provision for loss	December 31, 2020 $ 18,402 $ 169,805 ( 16,291) $ 153,514 $ 95,924 - $ 95,924 $ 4,356 15,196 $ 19,552 December 31, 2020 $ 25,189 - $ 25,189	December 31, 2019	December 31, 2019
		$ 17,748 $ 170,392 ( 8,548) $ 161,844 $ 96,060 ( 20) $ 96,040 $ 4,478 4,280 $ 8,758 December 31, 2019
		(	$ 40,187 2) $ 40,185

(1) Accounts receivable

The average credit period of the Company for commodity sales is 60 days, and the accounts receivable are not subject to interest.

In order to reduce credit risk, the management of the Company has assigned a special team to be responsible for the decision of credit facilities, credit approval and other monitoring procedures to ensure that appropriate actions have been taken for the recovery of overdue receivables. In addition,

the Company will review the recoverable amounts of the receivables one by one on the balance sheet date to ensure that appropriate impairment loss has been provided for the receivables that cannot be recovered. Therefore, the management of the consolidated company thinks that the credit risk of the Company has been significantly reduced.

The Company shall recognize the provision for loss of accounts receivable according to the expected credit loss during the period of existence. The expected credit loss during the existence period is calculated by the preparation matrix, which considers the past default records of customers and their current financial situation, the industrial economic situation, as well as the GDP forecast and industrial outlook. As the historical experience of credit loss of the Company shows that there is no significant difference in the loss pattern of different customer groups, the preparation matrix does not further distinguish customer groups, and only uses the overdue days of accounts receivable to determine the expected credit loss rate.

If there is evidence that the counterparty is facing serious financial difficulties and the Company cannot reasonably expect the recoverable amount, for example, if the transaction counterparty is in liquidation, the Company will directly write off the relevant receivables, but will continue the recourse activities, and the amount recovered due to recourse will be recognized as income.

The Company measures the provision for loss of accounts receivable (including those of related parties) according to the preparation matrix as follows:

follows:	follows:
December 31, 2020 Not overdue Expected credit loss rate 0% Total book value $ 232,806 Provision for loss (expected credit loss during the period of existence) - Cost after amortization $ 232,806			1~60 days overdue		61~120 days overdue		121~150 days overdue	151~180 days overdue		181~365 days overdue		More than 366 days overdue		Total
Expected credit loss rate Total book value Provision for loss (expected credit loss during the period of existence) Cost after amortization
	0% $ 232,806 - $ 232,806	(	0%~1% $ 15,095 15) $ 15,080	(	5%~10% $ 345 107) $ 238	(	20% $ 1,932 618) $ 1,314	100% $ - - $ -	(	100% $ 2,997 2,997) $ -	(	100% $ 12,554 12,554) $ -	(	$265,729 16,291) $ 249,438

December 31, 2019

Expected credit loss rate Total book value Provision for loss (expected credit loss during the period of existence) Cost after amortization		Not overdue		1~60 days overdue		61~120 days overdue		121~150 days overdue		151~180 days overdue		181~365 days overdue		More than 366 days overdue		Total
		0% $ 227,606 - $ 227,606	(	0%~1% $ 16,464 34) $ 16,430	(	5%~10% $ 8,597 485) $ 8,112	(	20% $ 7,342 1,606) $ 5,736	(	100% $ 1,457 1,457) $ -	(	100% $ 4,267 4,267) $ -	(	100% $ 719 719) $ -	(	$266,452 8,568) $ 257,884

Information on changes in provision for losses of accounts receivable (including those of related parties) is as follows:

Beginning balance Add: impairment loss in the current period Less: Allowance for loss reclassified as collections Ending balance		2020 $ 8,568 7,723 - $ 16,291		2019
			(	$ 3,618 5,000 50) $ 8,568

Compared with the balance at the beginning of the year, the total book value of accounts receivable as of December 31, 2020 and 2019 decreased by NT$723 thousand and decreased by NT$21,893 thousand, respectively, and the loss provision increased by NT$7,723 thousand and NT$4,950 thousand, respectively.

(2) Collection

The information about the change of provision for collection loss is as follows:

follows:
Beginning balance Add: Allowance for loss from reclassification of accounts receivable Less: actual write off in current period Ending balance	2020 $ 50 - - $ 50	2019
		$ 4,052 50 ( 4,052) $ 50

The collection amount is included in other assets and the provision for impairment losses has been made in full.

(3) Other receivables

Information about the change of provision for losses of other receivables (including those of related parties) is as follows:

Beginning balance Less: impairment loss of reversals in the current period Ending balance		2020 $ 2 ( 2) $ -		2019
				$ 279 ( 277) $ 2

11. Inventory

ntory
Finished products Semi-finished products Raw materials Merchandise inventory	December 31, 2020 $ 46,501 15,024 68,584 15,638 $ 145,747	December 31, 2019
			$ 60,609 18,275 71,636 14,749 $ 165,269

The cost of goods sold related to inventories for 2020 and 2019, is NT$988,901 thousand and NT$1,159,202 thousand, respectively. The cost of goods sold includes a loss on inventory revaluation, of NT$2,516 thousand and NT$458 thousand, respectively.

12. Investment under the equity method

stment under the equity method
Invested subsidiaries Joint ventures	December 31, 2020 $ 1,233,825 22,360 $ 1,256,185	December 31, 2019
			$ 1,169,235 22,496 $ 1,191,731

(1) Invested subsidiaries

sted subsidiaries
Tex Year International (SAMOA) Corp. Tex Year (Hong Kong) Ltd. Tex Year Vietnam Co., Ltd. Tex Year Europe Sp. z o. o.	December 31, 2020 $ 947,398 80,294 69,190 136,943 $ 1,233,825	December 31, 2019
			$ 881,971 85,897 65,311 136,056 $ 1,169,235

Name of subsidiary Tex Year International (SAMOA) Corp. Tex Year (Hong Kong) Ltd. Tex Year Vietnam Co., Ltd. Tex Year Europe Sp. z o. o.	Percentage of ownership interest and votingrights	Percentage of ownership interest and votingrights
	December 31, 2020 100% 100% 80% 80%	December 31, 2019
		100% 100% 80% 80%

In line with the future operation layout planning and the addition of a European operation site, the Company established Tex Year Europe Sp. z o.o. on August 10, 2015. Tex Year Europe Sp. z o.o. held a cash capital increase in

the third quarter of 2019 for subscription by the original shareholders according to their shareholding ratios, and the paid-in capital after the increase is NT$173,457 thousand (PLN21,010 thousand).

Please refer to Tables 6 and 7 for details of the Company’s indirectly held investment subsidiaries.

The share of profit or loss and other comprehensive income or loss of subsidiaries accounted for under the equity method is recognized based on the audited financial statements of each subsidiary for the same period.

(2) Joint ventures

int ventures	int ventures	int ventures
December 31, 2020 December 31, 2019 Individual non-significant joint ventures Tex Year Industrial Adhesives Pvt. Ltd. $ 22,360 $ 22,496 Summary information of individual unimportant joint ventures 2020 2019 Share of the Company Net profit of the current period $ 2,314 $ 2,980 Other comprehensive income ( 2,347) ( 917) Total comprehensive income ($ 33) $ 2,063			December 31, 2019
Share of the Company Net profit of the current period Other comprehensive income Total comprehensive income	( (	2020 $ 2,314 2,347) $ 33)
			(	$ 2,980 917) $ 2,063

The annual financial statements of Tex Year Industrial Adhesives Pvt. Ltd. ended on March 31. As it is difficult in practice to require the Company to prepare additional financial statements covering the period ended on December 31, the consolidated company uses the financial statements of the Company covering the balance sheet dates of March 31, 2020 and March 31, 2019 respectively, and adjusts the significant transactions between April 1, 2020 to December 31, 2020 and between April 1, 2019 to December 31, 2019.

The Company, adopted equity method, recognized an impairment loss of $9,522 thousand in fiscal 2020 because the recoverable amount of the machinery and equipment used in the production of products was less than the carrying amount because there was no future cash inflow.

The calculation of the equity-method investees and the Company's share of income or loss and other comprehensive income or loss is based on the unaudited financial statements of the investees for the same period; however, the Company's management believes that the unaudited financial statements of the investees are not material.

Please refer to Table 6 “Name, location, …. of the investee company” for the business nature, main business premises and country of incorporation of the joint ventures above.

13. Property, plant and equipment

Cost Balance on January 1, 2019 Influence number retroactive to IFRS 16 application Balance on January 1, 2019 (after restatement) Addition Disposal Reclassification Balance on December 31, 2019 Accumulated depreciation and impairment Balance on January 1, 2019 Influence number retroactive to IFRS 16 application Balance on January 1, 2019 (after restatement) Depreciation expenses (Continue)		Self-own land	Revaluation and appreciation of land	Revaluation and appreciation of land		Houses and buildings	Machinery and equipment	Office equipment	Other equipment	Unfinished project	Unfinished project		Total
		$ 45,717 - 45,717 - - - $ 45,717 $ - - - -		$ 45,324 - 45,324 - - - $ 45,324 $ - - - -		$ 215,390 - 215,390 2,094 - 247,297 $ 464,781 $ 149,318 - 149,318 11,988	$ 134,896 - 134,896 14,560 ( 1,572 ) 3,324 $ 151,208 $ 71,429 - 71,429 10,414	$ 14,531 - 14,531 1,281 ( 719 ) - $ 15,093 $ 10,222 - 10,222 1,224	$ 31,019 ( 1,963) 29,056 1,155 ( 500 ) - $ 29,711 $ 18,609 ( 1,062) 17,547 2,596		$ 245,309 - 245,309 16,050 - (247,297) $ 14,062 $ - - - -	$ 732,186 ( 1,963) 730,223 35,140 ( 2,791 ) 3,324 $ 765,896 $ 249,578 ( 1,062) 248,516 26,222

(Continue)

Disposal Balance on December 31, 2019 Net amount on December 31, 2019 Cost Balance on January 1, 2020 Addition Disposal Reclassification Balance on December 31, 2020 Accumulated depreciation and impairment Balance on January 1, 2020 Depreciation expenses Disposal Balance on December 31, 2020 Net amount on December 31, 2020		Self-own land	Revaluation and appreciation of land	Revaluation and appreciation of land		Houses and buildings	Machinery and equipment	Office equipment	Other equipment	Unfinished project	Unfinished project		Total
		$ - $ - $ 45,717 $ 45,717 - - - $ 45,717 $ - - - $ - $ 45,717		$ - $ - $ 45,324 $ 45,324 - - - $ 45,324 $ - - - $ - $ 45,324	$ - $ 161,306 $ 303,475 $ 464,781 5,706 ( 400 ) 14,062 $ 484,149 $ 161,306 14,199 ( 372) $ 175,133 $ 309,016		($ 1,495) $ 80,348 $ 70,860 $ 151,208 18,309 ( 316 ) 4,604 $ 173,805 $ 80,348 11,901 ( 316) $ 91,933 $ 81,872	( $ 719) $ 10,727 $ 4,366 $ 15,093 1,749 ( 455 ) - $ 16,387 $ 10,727 1,396 ( 455) $ 11,668 $ 4,719	($ 500) $ 19,643 $ 10,068 $ 29,711 1,601 ( 259 ) - $ 31,053 $ 19,643 2,488 ( 259) $ 21,872 $ 9,181		$ - $ - $ 14,062 $ 14,062 473 - ( 14,062) $ 473 $ - - - $ - $ 473	( $ 2,714) $ 272,024 $ 493,872 $ 765,896 27,838 ( 1,430 ) 4,604 $ 796,908 $ 272,024 29,984 ( 1,402) $ 300,606 $ 496,302

There is no sign of impairment in the assessment of the Company from January 1 to December 31 in 2020 and 2019, so no impairment loss is provided. Depreciation expenses are accrued on a straight-line basis based on the following number of years of service life:

number of years of service life:
Houses and buildings
Main building of plant	5 to 40 years
Electromechanical and other	3 to 15 years
Machinery and equipment	2 to 15 years
Office equipment	3 to 6 years
Other equipment	4 to 15 years

Please refer to note 32 for the amount of property, plant and equipment pledged by the Company for loans.

14. Lease agreement

(1) Right-of-use assets

ght-of-use assets
Book amount of right-of-use assets Buildings Office equipment	December 31, 2020 $ 710 519	December 31, 2019
		$ 1,720 699

(Continue)

December 31, 2020 December 31, 2019 Transportation equipment $ 204 $ 590 $ 1,433 $ 3,009 2020 2019 Addition of right-of-use assets $ - $ - Depreciation expenses of right-of-use assets Buildings $ 1,010 $ 1,010 Office equipment 180 192 Transportation equipment 386 386 $ 1,576 $ 1,588 e liabilities December 31, 2020 December 31, 2019 Book amount of lease liabilities Current $ 739 $ 1,505 Non-current $ 301 $ 1,040 The range of discount rate of lease liabilities is as follows: December 31, 2020 December 31, 2019 Buildings 1.55% 1.55% Office equipment 1.55% 1.55% Transportation equipment 1.55% 1.55%	December 31, 2019	December 31, 2019
		$ 590 $ 3,009 2019
	$ - $ 1,010 192 386 $ 1,588 December 31, 2019
	1.55% 1.55% 1.55%

(2) Lease liabilities

(3) Other lease information

her lease information
Short term rental expenses Total cash (outflow) from lease		2020 $ 2,166 $ 3,705)		2019
	(		(	$ 1,732 $ 3,429)

The Company chooses to exempt the recognition of buildings, office equipment and transportation equipment conforming to the short-term lease, and does not recognize the relevant right-of-use assets and lease liabilities.

15. Intangible assets

ngible assets
Cost Balance on January 1, 2019 Acquisition Disposal Balance on December 31, 2019 Accumulated depreciation Balance on January 1, 2019 Amortization expenses Disposal Balance on December 31, 2019 Net amount on December 31, 2019 Cost Balance on January 1, 2020 Acquisition Balance on December 31, 2020 Accumulated depreciation Balance on January 1, 2020 Amortization expenses Balance on December 31, 2020 Net amount on December 31, 2019	Patent rights $ 1,312 - - $ 1,312 $ 1,204 24 - $ 1,228 $ 84 $ 1,312 - $ 1,312 $ 1,228 23 $ 1,251 $ 61	Computer software $ 21,352 2,970 ( 60) $ 24,262 $ 17,373 1,745 ( 60) $ 19,058 $ 5,204 $ 24,262 4,051 $ 28,313 $ 19,058 1,746 $ 20,804 $ 7,509		Total
		( (	( (	$ 22,664 2,970 60) $ 25,574 $ 18,577 1,769 60) $ 20,286 $ 5,288 $ 25,574 4,051 $ 29,625 $ 20,286 1,769 $ 22,055 $ 7,570

Amortization expenses are accrued on a straight-line basis based on the following number of years of service life:

Patent rights 10 to 20years Computer software 2 to 8 years

Total amortization by function:

Total amortization by function:
Marketing expenses Administrative expenses R&D expenses		2020 $ 366 1,261 142 $ 1,769		2019
				$ 366 1,261 142 $ 1,769

16. Other assets

16.	Other assets
17.	Advance payment for goods Other prepaid expenses Refundable deposit Advance payment for equipment Others Current Non-current Borrowings (1) Short-term borrowings Unsecured loans Credit loans Borrowing rates (2) Long-term loans Secured borrowings (note 32) Taiwan Cooperative Bank (1) The Export-Import Bank of the Republic of China (2) Taiwan Cooperative Bank (3) Taiwan Business Bank (4) Taiwan Cooperative Bank (5) Taiwan Business Bank (6) Taiwan Business Bank (7) Taiwan Business Bank (8) Taiwan Business Bank (9) Taiwan Cooperative Bank (10) Subtotal Unsecured loans Hua Nan Bank credit loan (11)	December 31, 2020 $ 14,376 4,094 3,348 2,768 1,121 $ 25,707 $ 18,855 6,852 $ 25,707 December 31, 2020 $ 293,000 0.98%~1.04% December 31, 2020 $ - 14,250 31,908 10,000 18,807 60,000 40,000 40,000 18,000 60,000 292,965 40,000	December 31, 2019
			$ 4,517 4,961 1,648 3,864 1,963 $ 16,953 $ 10,529 6,424 $ 16,953 December 31, 2019
			$ 281,797 1.10%~1.15% December 31, 2019
				$ 8,253 28,500 46,058 10,000 29,482 60,000 40,000 40,000
				18,000 - 280,293 40,000

(Continue)

Export-Import Bank of the Republic of China (12) Subtotal Less: due within one year Long-term loan	December 31, 2020 $ 22,488 62,488 355,453 (110,851) $ 244,602	December 31, 2019	December 31, 2019
	(	(	$ 25,700 65,700 345,993 47,319) $ 298,674

(1) The period is from August 14, 2015 to August 13, 2020. From September 2015, each month is one period, for totally 60 periods. The principal and interest are amortized according to the annuity method, and have been fully paid off before schedule in March 2020. As of December 31, 2019, the effective annual interest rate was 1.42%.
(2) The period is from September 29, 2016 to September 28, 2021. From March 2018, every six months is one period, for totally eight periods. The principal and interest are amortized according to the average method. As of December 31, 2020 and 2019, the effective annual interest rate was 1.2386% and 1.4738%.
(3) The period is from December 28, 2017 to December 27, 2022. From January 2019, each month is one period, for totally 48 periods. The principal and interest are amortized according to the average method. As of December 31, 2020 and 2019, the effective annual interest rate was 1.25% and 1.45%.
(4) The period is from December 28, 2017 to December 27, 2032. From January 2021, each month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. As of December 31, 2020 and 2019, the effective annual interest rate was 1.25% and 1.5%.
(5) The period is from June 28, 2018 to December 27, 2022. From January 2019, each month is one period, for totally 48 periods. The principal and interest are amortized according to the average method. As of December 31, 2020 and 2019, the effective annual interest rate was 1.25% and 1.45%.
(6) The period is from September 14, 2018 to December 28, 2032. From January 2021, each month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. As of December 31, 2020 and 2019, the effective annual interest rate was 1.25% and 1.5%.
(7) The period is from October 8, 2018 to December 28, 2032. From January 2021, each month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. As of December 31, 2020 and 2019, the effective annual interest rate was 1.25% and 1.5%.
(8) The period is from November 6, 2018 to December 28, 2032. From January 2021, each month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. As of December 31, 2020 and 2019, the effective annual interest rate was 1.25% and 1.5%.
(9) The period is from December 31, 2019 to December 28, 2032. From January 2021, each month is one period, totally 144 periods. The principal and interest are amortized according to the average method. As of December 31, 2020 and 2019, the effective annual interest rate was 1.25% and 1.5%.
(10) The period is from March 30, 2020 to March 30, 2025. From April 2020, each month is one period, for totally 48 periods. The principal and interest are amortized according to the average method. As of December 31, 2020, the effective annual interest rate was 1.45%.
(11) The period is from December 30, 2019 to December 29, 2021. From January 2020, each month is one period, for totally 24 periods. The interest was paid in each period, and the principal was repaid at one time when due. As of December 31, 2020 and 2019, the effective annual interest rate was 1.12% and 1.4%.
(12) The period is from February 26, 2019 to February 25, 2024. From August 2020, six months is one period, for totally 8 periods. The principal and interest are amortized according to the average method. As of

December 31, 2020 and 2019, the effective annual interest rate was 1.2356% and 1.4736%.

The consolidated company has provided part of the land, houses and buildings as collateral. Please refer to notes 13 and 32.

18. Corporate bonds payable

orate bonds payable
Domestic secured convertible corporate bonds Domestic unsecured convertible corporate bonds Less: convertible bond discounts	December 31, 2020 $ 200,000 72,900 272,900 ( 11,818) $ 261,082	December 31, 2019
	(	(	$ 200,000 100,000 300,000 16,942) $ 283,058

The relevant information of domestic convertible corporate bonds issued by the Company is as follows:

(1) The conditions for the issuance of the Company’s first domestic secured convertible corporate bond is as follows: the Company has been approved by the competent authority to raise and issue the first domestic secured convertible corporate bond, with a total issuance amount of NT$250,000 thousand and a coupon rate of 0%. The term is three years, and the circulation period is from November 14, 2016 to November 14, 2019. It was listed on the Taipei Exchange (OTC) Securities Exchange of the Republic of China on November 14, 2016. When the convertible bond is due, it shall be paid in cash at one time according to the face value of the bonds. The holders of the convertible bond may, from one month after the day following the issuance date of this bond to the maturity date, request a conversion into the common shares of the company at any time, except for the period during which the transfer of ownership shall be suspended in accordance with the relevant measures or laws and regulations. The rights and obligations of the common shares after the conversion are the same as those of the common shares originally issued. The conversion price of the convertible corporate bond is set in accordance with the pricing model prescribed in the conversion method, with the conversion price of NT$15.3 per share. In case of any

anti-dilution provisions of the Company, the subsequent conversion price shall be adjusted in accordance with the pricing model prescribed in the conversion method. Because the Company has handled stock ex-right operations (cash capital increase and issuance of new shares) for 2016 and distributed cash dividends (NT$0.6 per share) for 2017, the conversion price of the Company’s bond has been adjusted to NT$14.6 in accordance with the conversion method.

(2) The conditions for the issuance of the Company’s second domestic secured convertible corporate bond are as follows: the Company has been approved by the competent authority to raise and issue the second domestic secured convertible corporate bond, with a total issuance amount of NT$200,000 thousand and a coupon rate of 0%. The term is 5 years, and the circulation period is from October 23, 2019 to October 23, 2024. It was listed on the Taipei Exchange (OTC) Securities Exchange of the Republic of China on October 23, 2019. When the convertible bond is due, it shall be paid in cash at one time according to the face value of the bonds. The holders of the convertible bond may, from three months after the day following the issuance date of this bond to the maturity date, request a conversion into the common shares of the company at any time, except for the period during which the transfer of ownership shall be suspended in accordance with the relevant measures or laws and regulations. The conversion price of the convertible corporate bond is set in accordance with the pricing model prescribed in the conversion method, with the conversion price of NT$15.7 per share. In case of any anti-dilution provisions of the Company, the subsequent conversion price shall be adjusted in accordance with the pricing model prescribed in the conversion method.

From three months after the day following the issuance date of this bond to 40 days before the maturity date, if the closing price of the common shares of the Company exceeds 30% (inclusive) of the conversion price at that time for 30 consecutive business days, or if the outstanding balance of the convertible corporate bond is less than 10% of the original issuance amount, the Company may recall all the bond certificates in cash according to the face value of the bond.

(3) The issuance conditions of the Company are as follows: the Company has been approved by the competent authority to raise and issue the third domestic unsecured convertible corporate bond, with a total issuance amount of NT$100,000 thousand and a coupon rate of 0%. The term is 3 years, and the circulation period is from October 24, 2019 to October 24, 2022. It was listed on the Taipei Exchange (OTC) Securities Exchange of the Republic of China on October 24, 2019. When the convertible bond is due, it shall be paid in cash at one time according to the face value of the bonds. The holders of the convertible bond may, from three months after the day following the issuance date of this bond to the maturity date, request a conversion into the common shares of the company at any time, except for the period during which the transfer of ownership shall be suspended in accordance with the relevant measures or laws and regulations. The conversion price of the convertible corporate bond is set in accordance with the pricing model prescribed in the conversion method, with the conversion price of NT$14.3 per share. In case of any anti-dilution provisions of the Company, the subsequent conversion price shall be adjusted in accordance with the pricing model prescribed in the conversion method.

Conversion prices of the second domestic secured convertible corporate bond and the third domestic unsecured convertible corporate bond were adjusted to NT$ 15.40 and NT$ 14.00 respectively as of the ex-dividend date of July 27, 2020.

The above-mentioned convertible corporate bonds include the conversion right of the main contractual debt instrument, the sale/redemption derivative instrument and the equity component, which are expressed under the equity by additional capital from retained earnings -

conversion rights. The effective interest rate originally recognized for the liability component is 1.26% ~ 1.89%.

The changes in the main contractual debt instrument of 2019 and 2020 are as follows:

as follows:
Component of liabilities on January
1, 2019		$ 246,636
Issue price (net of transaction costs
of NT$5,000 thousand)		295,000
Sale/redemption derivative		30
Component of equity	(	12,753)
Component of liabilities on the
date of issuance		282,277
Interest calculated at effective
interest rate in the current period		4,144
Common shares converted from
payable corporate bonds	(	1,499 )
Redeemed corporate bonds	(	248,500)
Component of liabilities on
December 31, 2019		283,058
Interest calculated at effective
interest rate in the current period		4,059
Common shares converted from
payable corporate bonds	(	26,035)
Component of liabilities on
December 31, 2020		$ 261,082

The changes in the sale/redemption derivative from October 23 to

December 31, 2019 and from January 1 to December 31, 2020 are as follows:

Date of Issuance Loss from changes in fair value ( Balance on December 31, 2019 Gain from changes in fair value Balance on December 31, 2020	$ 30 30) - 560 $ 560

The change of conversion right (under additional capital from retained earnings) of the equity component for 2019 and 2020 is as follows:

earnings) of the equity component for 2019 and	2020 is as follows:
Balance on January 1, 2019		$	6,345
Date of issuance			12,753
Common shares converted
from payable corporate
bonds	(		38 )
Invalid paid off at maturity	(		6,307)
Balance on December 31, 2019			12,753

(Continue)

Common shares converted from payable corporate bonds ( $ 1,092 ) Balance on December 31, 2020 $ 11,661

The total face value of the first domestic secured convertible corporate bond that the holders have exercised the conversion right is NT$1,500 thousand. 102,738 shares of common stock of the Company were converted into, and NT$472 thousand of additional capital from retained earnings was recognized. The remaining face value of NT$248,500 thousand was paid off in full on November 14, 2019.

As of December 31, 2020, the total face value of the third domestic unsecured convertible corporate bond that the holders have exercised the conversion right is NT$27,100 thousand. 1,920,575 shares of common stock of the Company were converted into, and NT$6,829 thousand of additional capital from retained earnings was recognized.

19. Notes payable and accounts payable

Notes payable and accounts payable
Accounts payable Arising from business Accounts payable-related parties Arising from business Other liabilities Current Other payable Estimate other expense Bonus payable Salary payable Remuneration payable to employees, directors and supervisors	December 31, 2020 $ 142,454 $ 17,293 December 31, 2020 $ 28,015 24,894 13,239 $ 6,673	December 31, 2019
		$ 140,087 $ 9,470 December 31, 2019

		$ 20,111 20,473 12,812 $ 4,666

20. Other liabilities

(Continue)

December 31, 2020 $ 2,371 4,485 15,240 $ 94,917 $ 12,261 711 - $ 12,972 $ 186 December 31, 2020 $ 1,046 2020 $ 1,666 ( 620) $ 1,046	December 31, 2019	December 31, 2019
	$ 14,833 4,293 19,790 $ 96,978 $ 13,286 759 3,137 $ 17,182 $ 211 December 31, 2019
		$ 1,666 2019
(		$ 767 899 $ 1,666

The provision for warranty liabilities is the present value of the best estimate of the outflow of future economic benefits caused by the warranty obligation from the management of the Company in accordance with the contract for the sale of goods. This estimate is based on historical warranty experience, taking into account the adjustment for new raw materials, process changes or other factors affecting product quality.

22. Post-retirement benefit plans

(1) Defined contribution plan

The pension system of the “Labor Pension Act” is applicable to the Company, and is a defined contribution plan managed by the government. The pension is allocated to the individual account of the Labor Insurance Bureau at 6% of the employee’s monthly salary.

(2) Defined benefit plans

The Company implements a pension system of defined benefit plans managed by the government as prescribed in the “Labor Standards Act”. The employee's pension is calculated based on the length of service and the average salary for the six months before the approved retirement date. The Company contributes 8% of employees' monthly salaries to the pension fund, which is deposited in the name of the Labor Pension Fund Supervisory Committee in a special account at the Bank of Taiwan. Before the end of the year, if the balance in the special account is estimated to be insufficient to pay for employees who are expected to meet the retirement requirements in the following year, the difference will be withdrawn in one lump sum by the end of March of the following year. The management of the account is entrusted to the Bureau of Labor Fund Utilization, Ministry of Labor, and the Company has no right to influence the investment management strategy.

The amounts included in the individual balance sheet for defined benefit plans are as follows

plans are as follows
Current value of defined benefit obligation Fair value of planned assets Net defined benefit liabilities	December 31, 2020 $ 86,518 ( 44,027) $ 42,491	December 31, 2019
	(	(	$ 81,931 40,195) $ 41,736

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

Balance on January 1, 2019 Service cost Service cost of the current period		Defined benefit Current value of obligation $ 93,323 986		Planned assets Fair value $ 44,817 -	Net defined benefit Liabilities (assets)	Net defined benefit Liabilities (assets)
						$ 48,506 986

(Continue)


Interest expenses/interest income Recognized as profit (loss) Compensation for planned assets (in addition to the amount included in net interest) Actuarial losses - changes in financial assumptions Actuarial profit - experience adjustment Recognized as other comprehensive income Employer contribution Benefit paid Balance on December 31, 2019 Balance on January 1, 2020 Service cost Service cost of the current period Interest expenses/interest income Recognized as profit (loss) Compensation for planned assets (in addition to the amount included in net interest) Actuarial losses - changes in financial assumptions Actuarial loss - experience adjustment Recognized as other comprehensive income Employer contribution Benefit paid Balance on December 31, 2020		Defined benefit Current value of obligation $ 920 1,906 - 2,114 4,270) 2,156) - 11,142) $ 81,931 $ 81,931 835 604 1,439 - 3,784 1,431 $ 5,215 - 2,067) $ 86,518		Planned assets Fair value $ 460 460 1,637 - - 1,637 4,423 11,142) $ 40,195 $ 40,195 - 309 309 1,366 - - $ 1,366 4,224 2,067) $ 44,027	Net defined benefit Liabilities (assets)
	( ( ( (	$	( (	$	$ 460 1,446 ( 1,637 ) 2,114 ( 4,270) ( 3,793) ( 4,423 ) - $ 41,736 $ 41,736 835 295 1,130 ( 1,366 ) 3,784 1,431 $ 3,849 ( 4,224 ) - $ 42,491

The amounts recognized in profit or loss for defined benefit plans are summarized by function as follows:

Operating cost Marketing expenses Administrative expenses R&D expenses		2020 $ 259 367 318 186 $ 1,130		2019
				$ 374 444 411 217 $ 1,446

The Company is exposed to the following risks as a result of the Labor Standards Law pension system.

Investment risk: The Bureau of Labor Fund Operation of the Ministry of Labor invests the Labor Pension Fund in domestic (and foreign) equity and debt securities and bank deposits through self-application and entrusted operation, but the amount of plan assets allocated to the Company is based on the income calculated at an interest rate not lower than the local bank's two-year time deposit rate.
Interest rate risk: A decrease in interest rates on government bonds/corporate bonds will increase the present value of the defined benefit obligation, with a corresponding increase in the return on investment in plan assets, both of which have a partially offsetting effect on the net defined benefit obligation.
Salary Risk: The present value of the defined benefit obligation is calculated by reference to the future salary of the plan member. Therefore, increases in plan members' salaries will result in an increase in the present value of the defined benefit obligation.

The present value of the Company's defined benefit obligation was actuarially determined by a qualified actuary with the following significant assumptions as of the measurement date.

Discount rate Expected rate of salary increase Turnover rate	December 31, 2020 0.30% 3.00% 0.42%	December 31, 2019
		0.75% 3.00% 0.39%

The amount by which the present value of the defined benefit obligation would increase (decrease) if there were reasonably possible changes in significant actuarial assumptions, respectively, with all other assumptions held constant, is as follows

held constant, is as follows
Discount rate 0.25% increase 0.25% decrease Expected rate of salary increase 0.25% increase 0.25% decrease Turnover rate 10% increase 10% decrease	December 31, 2020 ($ 2,130) $ 2,202 $ 2,151 ($ 2,093) $ - $ -	December 31, 2019
	( (	( (	$ 2,114) $ 2,189 $ 2,135 $ 2,073) $ - $ -

The sensitivity analysis above may not reflect actual changes in the present value of the defined benefit obligation because the actuarial assumptions may be correlated and changes in only one assumption are not probable.

	probable.
23.	Amount expected to be withdrawn within 1 year Average Period of Defined Benefit Obligation to maturity Equity (1) Share capital 1. Common stock Authorized number of shares (1,000 shares) Authorized share capital Number of issued shares fully paid for (1,000 shares) Capital of issued shares	December 31, 2020 $ 3,306 10 years December 31, 2020 150,000 $ 1,500,000 89,386 $ 893,857	December 31, 2019
			$ 5,000 10 years December 31, 2019
				150,000 $ 1,500,000 88,577 $ 885,767

The par value of each issued common share is NT$10. Each share has one voting right and the right to receive dividends.

Certificates of right to convert bonds for shares

Number of shares converted but not yet registered for change (1,000 shares) Share capital converted but not yet registered for change	December 31, 2020 1,214 $ 12,143	December 31, 2019	December 31, 2019
			103 $ 1,027

(2) Additional capital from retained earnings

can be used to cover losses, issue cash or supplement share capital (1) Premium from share issuance Premium from convertible bond conversion can only be used to cover losses (2) Changes in net equity of subsidiaries and joint ventures recognized under the equity method The conversion right shall be paid off at maturity and cannot be used for any other purpose. Conversion right	December 31, 2020 $ 22,142 8,431 29 6,307 11,661 $ 48,570	December 31, 2019	December 31, 2019
			$ 48,895 510 29 6,307 12,753 $ 68,494

Capital surplus - premiums from stock issuance and conversion of bonds may be used to offset losses or, when the Company has no losses, to distribute cash or to capitalize capital, provided that the capitalization is limited to a certain percentage of the paid-in capital each year.
Capital surplus generated from changes in equity of the equity-method investee company and the maturity of the conversion rights should not be used for any purpose other than to compensate for losses.

(3) Retained earnings and dividend policy

According to the provisions of the earnings distribution policy of the Articles of Association of the Company, if there is any earnings in the annual final accounts, tax shall be paid according to law, and after making up the accumulated loss, 10% shall be set aside as the legal reserve, and the rest shall be set aside or reversed as the special additional capital from retained earnings according to the provisions of laws and regulations; if there is any remaining balance and the accumulated undistributed earnings, the board of directors shall prepare an earnings distribution proposal and submit it to the shareholders’ meeting for resolution on dividend distribution. Please refer to note 25(7) employees’ remuneration and directors’ and supervisors’ remuneration for the distribution policy of employees’ remuneration and directors’ and supervisors’ remuneration stipulated in the Articles of Association.

The Company’s products are diversified, its profits are stable and its financial structure is sound. The dividend policy is based on the consideration of significant expansion plans and capital expenditures in the next few years. The actual distribution shall be proposed by the board of directors to the shareholders’ meeting according to the Company’s operating conditions. The distribution of ‘ dividends to shareholders shall be at least 50% of the distributable earnings of the current year after deducting the legal reserve and special reserve. The cash dividend shall account for more than 20% of the total amount of dividends, but if the cash dividend per share is less than NT$0.5 (inclusive), it may be distributed in the form of stock dividend instead.

The legal reserve shall be allocated until its balance reaches the total paid-in share capital of the Company. The legal reserve may be used to make up for losses. When the Company has no loss, the part of the legal reserve exceeding 25% of the total paid-in share capital may be distributed in cash in addition to being appropriated as share capital.

The Company shall set aside and reverse the special reserve in accordance with the letter from the Financial Supervisory Commission referenced Jin-Guan-Cheng-Fa No. 1010012865 and “Questions and answers

on the application of special reserve after adoption of International Financial Reporting Standards (IFRSs)”.

The Company’s board of directors’ meeting held on June 16, 2020 and the general shareholders’ meeting held on June 24, 2019 respectively proposed and passed the following earnings distribution plans for the years of 2019 and 2018:

of 2019 and 2018:
Legal reserve Special reserve Cash dividends Cash dividends per share (NT$)		2019 $ 4,418 $ 40,395 $ - $ -		2018
				$ 3,117 $ 20,304 $ 13,287 $ 0.15

In addition, on June 16, 2020, the Company’s board of directors’ meeting proposed to distribute a cash dividend of NT$0.3 per share from the additional capital from retained earnings due to the premium on the issuance of common shares, totaling NT$26,753 thousand.

The Company’s board of directors’ meeting held on March 26, 2021 proposed the following earnings distribution plans for the year 2020:

Legal reserve Special reserve Stock dividend Stock dividends per share (NT$)		2020
		$ 6,666 $ 15,554 $ 45,321 $ 0.5

The appropriation of earnings for 2020 is pending the resolution of the shareholders' meeting scheduled to be held on June 18, 2011.

24. Revenue

nue
Revenue from goods sold		2020 $ 1,251,076		2019
				$ 1,446,167

See Note 10 and Note 20 for contract balances.

25. Net profit of the current period

(1) Interest income

terest income
Bank deposits		2020 $ 896		2019
				$ 1,059

(2) Other income

her income
Rental income Management and technical service income Government subsidy income Others		2020 $ 78 9,783 12,187 9,790 $ 31,838		2019
				$ 73 12,695 20,114 8,720 $ 41,602

(3) Other benefits and (loss)

her benefits and (loss)
(Loss) benefits of financial assets/liabilities measured at fair value through profit and loss Loss (gain) from disposal of property, plant and equipment		2020 $ 560 28) $ 532	2019
	(		( $ 30 ) 4 ($ 26)

(4) Financial cost

(4) Financial cost
2020 2019 Convertible corporate bond interest (note 18) $ 4,059 $ 4,144 Interest on bank loan 8,635 8,333 Interest on lease liabilities 35 35 Less: the amount included in the cost of eligible assets - ( 900) $ 12,729 $ 11,612 Information on interest capitalization is as follows (2020: none): 2019 Amount of capitalized interest $ 900 Interest rate of capitalized interest 1.51% (5) Depreciation and amortization		2019
	$ 900 1.51%

preciation and amortization
Property, plant and equipment Intangible assets Right-of-use assets	2020 $ 29,984 1,769 1,576	2019
		$ 26,222 1,769 1,588

(Continue)

Long-term prepaid expenses Depreciation expenses summary by function Operating cost Operating expenses Amortized expenses summary by function Operating expenses ployee benefits Short-term employee benefits Salary expense Labor and health insurance expenses Post-employment benefits Defined contribution plan Defined benefit plan (Note 22) Other employee benefits Total employee benefit expenses Summary by function Operating cost Operating expenses		2020 646 $ 33,975 $ 22,208 9,352 $ 31,560 $ 2,415 2020 $ 182,791 16,682 199,473 $ 9,288 1,130 10,418 10,406 $ 220,297 $ 72,068 148,229 $ 220,297		2019
				382 $ 29,961 $ 18,250 9,560 $ 27,810 $ 2,151 2019
				$ 177,806 16,462 194,268 $ 9,131 1,446 10,577 9,365 $ 214,210 $ 71,377 142,833 $ 214,210

(6) Employee benefits

(7) Remuneration payable to employees, directors and supervisors

In accordance with the Articles of Association, based on the net profit before tax of the current year minus the benefits before the distribution of the

employees’ remuneration and the directors’ and supervisors’ remuneration, the Company allocates 1% to 10% as the employees’ remuneration and no more than 3% as the directors’ and supervisors’ remuneration after making

up the losses. In 2020 and 2019, the employees’ remuneration and the directors’ and supervisors’ remuneration resolved in the Board of Directors’ Meeting on March 26, 2021 and March 27, 2020 are as follows:

Estimated proportion

Estimated proportion
Employees’ remuneration Directors and supervisors’ remuneration Amount Employees’ remuneration Directors and supervisors’ remuneration	2020 2019 6% 6% 2% 2% Cash	2019
	2020 $ 5,005 1,668	2019
		$ 3,499 1,166

If there is any change in the amount of the annual individual financial statements after the date of issuance, it shall be handled according to the change in accounting estimates and recorded in the next year.

There is no difference between the actual distribution amount of employees’ remuneration and directors’ and supervisors’ remuneration in 2019 and 2018 and the amount recognized in the individual financial statements in 2019 and 2018.

For information on the employees’ remuneration and directors’ and supervisors’ remuneration in 2020 and 2019 resolved by the board of directors’ meetings, please visit “MOPS” of the Taiwan Stock Exchange.

26. Income tax

(1) Major components of income tax expense recognized in profit or loss

Income tax of the current period Generated in the current period Surtax on undistributed earnings Adjustment for previous years		2020 $ 262 120 9,735) 9,353)		2019
	( (			$ 8,984 - 17 9,001

(Continue)

2020 Deferred income tax Generated in the current period $ 16,276 Adjustment for previous years 84 16,360 Income tax expenses recognized in income $ 7,007 The adjustment of accounting income to income follows: 2020 Net profit before tax $ 76,747 Income tax expense on net income before income tax at statutory tax rate (20%) $ 15,349 Non-deductible expenses for tax purposes 1,780 Surtax on undistributed earnings 120 Deferred income tax effect of earnings remittance from subsidiaries - Adjustments to current income tax expense in prior years ( 8,965 ) Others ( 1,277) Income tax expenses recognized in income $ 7,007 (2) Income tax recognized in other comprehensive income 2020 Income tax of the current period Adjustment for previous years $ - Deferred income tax Generated in the current period -Remeasurements of defined benefits plans ( 770 )		2019
	tax	$ 475 - 475 $ 9,476 expense is as 2019
	$ 53,658 $ 10,732 1,318 - ( 1,763 ) - ( 811) $ 9,476 2019
	(	$ 766) 758

The adjustment of accounting income to income tax expense is as follows:

(Continue)

		2020		2019
-Conversion of foreign
operating organizations	( $	2,992)	( $	9,539)
	(	3,762)	(	8,781)
	($	3,762)	($	9,547)

(3) Income tax assets and liabilities of the current period

Current income tax liabilities Income tax payable	December 31, 2020 $ -	December 31, 2019	December 31, 2019
			$ 5,961

(4) Deferred income tax assets and liabilities

Changes in deferred income tax assets and liabilities:

2020

2020
Deferred income tax assets Temporary differences Impairment loss of financial assets measured at fair value through other comprehensive income Gross profit on unrealized sales Property, plant and equipment Provision for liabilities Defined benefit retirement plan Leave payment payable Actuarial profit and loss Provision for loss Provisions for loss from inventory falling price and dead stock Exchange differences in foreign operating organizations Unrealized exchange loss Others		Beginning balance $ 600 779 53 333 155 859 3,538 1,967 2,339 18,215 821 521 $ 30,180	Recognized as profit (loss) $ - ( 112 ) ( 4 ) ( 124 ) ( 155 ) 38 - 1,534 239 - ( 821 ) ( 390) $ 205	Recognized as Other comprehensiv e income $ - - - - - - 770 - - 2,992 - - $ 3,762		Ending balance
			( ( ( ( ( (			$ 600 667 49 209 - 897 4,308 3,501 2,578 21,207 - 131 $ 34,147

Deferred income tax liabilities Temporary differences Investment under the equity method Provision for land appreciation tax Defined benefit retirement plan Unrealized profit on exchange 2019 Deferred income tax assets Temporary differences Impairment loss of financial assets measured at fair value through other comprehensive income Gross profit on unrealized sales Property, plant and equipment Provision for liabilities Defined benefit retirement plan Leave payment payable Actuarial profit and loss Provision for loss Provisions for loss from inventory falling price and dead stock Exchange differences in foreign operating organizations Unrealized exchange loss Others Deferred income tax liabilities Temporary differences Investment under the equity method		$ 53,683 9,558 - - $ 63,241 Beginning balance $ 600 781 56 154 751 1,389 4,296 887 2,247 8,676 - 340 $ 20,177 $ 51,602	$ 15,771 - 283 511 $ 16,565 Recognized as profit (loss) $ - ( 2 ) ( 3 ) 179 ( 596 ) ( 530 ) - 1,080 92 - 821 181 $ 1,222 $ 2,081	$ - - - - $ - Recognized as Other comprehensive income $ - - - - - - ( 758 ) - - 9,539 - - $ 8,781 $ -		$ 69,454 9,558 283 511 $ 79,806 Ending balance
			( ( ( (	(		$ 600 779 53 333 155 859 3,538 1,967 2,339 18,215 821 521 $ 30,180 $ 53,683

(Continue)

Provision for land appreciation tax Others		Beginning balance $ 9,558 384 $ 61,544	Recognized as profit (loss) $ - ( 384) $ 1,697	Recognized as Other comprehensive income $ - - $ -		Ending balance
			(			$ 9,558 - $ 63,241

(5) Approved income tax situation

The Company’s declared cases up to 2018 have been approved by the tax collection authority.

27. Earnings per share

Unit: NT$ per share

Basic earnings per share Diluted earnings per share		2020 $ 0.78 $ 0.68		2019
				$ 0.50 $ 0.44

The earnings used for calculating earnings per share and weighted average number of common shares are as follows:

Net profit of the current period

Net profit of the current period
Net Profit Net profit used to calculate basic earnings per share Effect of potential common stock with dilution: After-tax interest on convertible bonds Net profit used to calculate diluted earnings per share Number of sharesUnit: thousand shares To calculate the weighted average number of shares of common stock for basic earnings per share Effect of potential common stock with dilution:	2020 $ 69,740 $ 69,740 3,247 $ 72,987 2020 89,270	2019
		$ 44,182 $ 44,182 1,971 $ 46,153 2019
		88,592

Corporate bond conversion Employees’ remuneration To calculate the weighted average number of shares of common stock for diluted earnings per share		2020 18,293 382 107,945		2019
				17,108 312 106,012

If the Company has the option to pay employees’ remuneration in shares or cash, the calculation of diluted earnings per share is based on the assumption that the employees’ remuneration will be issued in shares, and the weighted average number of outstanding shares will be included in the calculation of diluted earnings per share when the potential common shares are diluted. When calculating the diluted earnings per share before the issuance of employees’ remuneration shares in the next annual resolution, the dilution effect of such potential common shares shall also be considered.

28. Government subsidy

In addition, in May and November 2019, and in May 2020, due to the implementation of the R&D and innovation project entrusted by the Ministry of Economic Affairs, the Company obtained a subsidy of NTD 10,300 thousand, NTD 10,300 thousand, and NTD 5,900 thousand according to the grant approval letter of the Taiwan Small and Medium Enterprises Counseling Foundation referenced Ji No. 1070001330B. This amount has been listed under deferred government subsidy income and recognized according to the actual development level of the plan. From January 1 to September 30, 2020 and 2019, respectively NTD 10,801 thousand and NTD 10,357 thousand have been recognized as subsidy income. Also in May 2020, part of the unused subsidy of NTD 242 thousand granted in 2019 was repaid, and subsequently in June of 2019, part of the unused subsidy of NTD 3,657 thousand granted in 2018 was repaid.

29. Capital risk management

The purpose of the Company’s capital management policy is to protect the Company’s ability to continue as a going concern in order to provide returns to shareholders and benefits to other equity holders as much as possible. To

ensure that the above objectives are achieved, the Company must maintain a large amount of capital to meet the needs of the expansion and upgrading of plant and equipment. Therefore, the capital management of the Company is to ensure that necessary financial resources and operation plans are available to meet the needs of working capital, capital expenditure, research and development costs, debt repayment and dividend expenditure in the next 12 months. The Company is not subject to other external capital requirements.

30. Financial Instruments

(1) Fair value information - financial instruments not measured at fair value December 31, 2020

December 31, 2020
Financial liabilities Financial liabilities measured at cost after amortization - Second domestic secured convertible corporate bonds - Third domestic unsecured convertible corporate bonds December 31, 2019	Carrying amount		Fair value
		Level 1	Level 2	Level 3	Total
	$ 190,638 70,444 $ 261,082	$ - - $ -	$ 223,629 85,243 $ 308,872	$ - - $ -	$ 223,629 85,243 $ 308,872

December 31, 2019
Financial liabilities Financial liabilities measured at cost after amortization - Second domestic secured convertible corporate bonds - Third domestic unsecured convertible corporate bonds	Carrying amount		Fair value
		Level 1	Level 2	Level 3	Total
	$ 188,243 94,815 $ 283,058	$ - - $ -	$ 246,249 96,929 $ 343,178	$ - - $ -	$ 246,249 96,969 $ 343,178

In addition to the above, the management of the Company believes that the book value of financial assets and financial liabilities not measured at fair value approaches their fair value or their fair value cannot be reliably measured.

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

December 31, 2020

December 31, 2020
Level 1 Level 2 Financial assets measure at fair value through income statement Derivatives $ - $ - December 31, 2019 Level 1 Level 2 Financial assets measured at fair value through other comprehensive income Equity instrument investment - Domestic unlisted (OTC) market shares $ - $ - There was no transfer between level 1 measurements in 2020 and 2019.	Level 2 $ - Level 2		Level 3 $ 560 Level 3		Total $ 560 Total $ 3,586 fair value

Adjustment of financial instruments measured at level 3 fair value

January 1 to December 31, 2020

Financial assets Beginning balance Recognized as profit (loss) Recognized as other comprehensive income (Unrealized profit or loss on valuation of financial assets measured at fair value through other comprehensive income Ending balance	Measured at fair value through profit and loss Derivatives $ - 560 - $ 560	Through other comprehensive income Financial assets measured at fair value	Through other comprehensive income Financial assets measured at fair value
		Equity instrument
		(	$ 3,586 - 3,586) $ -

January 1 to December 31, 2019

Financial assets Beginning balance Recognized as other comprehensive income (Unrealized profit or loss on valuation of financial assets measured at fair value through other comprehensive income Ending balance	Measured at fair value through profit and loss Derivatives $ - - $ -	Through other comprehensive income Financial assets measured at fair value	Through other comprehensive income Financial assets measured at fair value
		Equity instrument
		(	$ 6,586 3,000) $ 3,586

Evaluation technology and input value of level 3 fair value measurement
(1) Derivative instrument-Redemption adopts the Binomial Tree Model in the measurement of fair value. Important unobservable inputs adopted here serves as the reference to volatility in stock prices. When volatility in stock price increases, the fair value of such derivative instruments increases relatively.
(2) Domestic unlisted (or non-OTC) stocks are evaluated by the asset method, and their fair value is determined by reference to the latest net value of the invested company and the observable financial and business conditions of the Company; when the liquidity discount decreases, the fair value of such investment will increase. When the liquidity discount increases/decreases by 1%, the fair value in 2019 of the Company will decrease/increase by NTD 36 thousand (2020: none).

(3) Types of financial instruments

pes of financial instruments
Financial assets Financial assets measured at cost after amortization (note 1) Financial assets measured at fair value through other comprehensive income - equity instrument investment Financial liabilities Measured at cost after amortization (note 2)	December 31, 2020 $ 467,514 - 1,155,154	December 31, 2019
		$ 467,656 3,586 1,137,956

Note 1: Balance refers to financial assets measured at cost after amortization, including cash and cash equivalents, financial assets measured at cost after amortization - non-current, notes receivable, accounts receivable (including those of related parties), other receivables (including those of related parties, excluding tax refunds receivable) and refundable deposits.

Note 2: The balance includes short-term loans, accounts payable (including those of related parties), other payables (including those of related parties), corporate bonds payable and long-term loans (including the part due within one year) and other financial liabilities measured at cost after amortization.

(4) Purpose and policy of financial risk management

The main financial instruments of the Company include equity investment, accounts receivable, accounts payable, corporate bonds payable, loans and lease liabilities. The financial management department of the Company provides services for all business units, coordinates the entry into domestic and international financial markets, and supervises and manages the financial risks related to the operation of the consolidated company by analyzing the internal risk report of the exposure according to the risk level and breadth. These risks include market risk (including exchange rate risk and interest rate risk), credit risk and liquidity risk.

1. Market risk

The main financial risk caused by the operating activities of the Company to the consolidated company are the foreign currency exchange rate change risk (refer to (1) below) and the interest rate change risk (refer to (2) below).

(1) Exchange rate risk

Part of the cash inflow and outflow of the Company is in foreign currency, so it has the effect of natural hedging; the exchange rate risk management of the Company is for the purpose of hedging, not for the purpose of profit.

Please refer to note 34 for the book value of monetary assets and monetary liabilities of the Company denominated in non-functional currency on the balance sheet date.

Sensitivity analysis

The Company is mainly affected by the exchange rate fluctuations of US dollar and RMB.

The Table below details the sensitivity analysis of the Company when the exchange rate of New Taiwan Dollar (functional currency) changes 1% against relevant foreign currencies. The sensitivity analysis only includes the monetary items that are in circulation, and the conversion at the end of the period is adjusted by 1% of the exchange rate change. The positive number in the Table below refers to the amount that will reduce the pre-tax net loss/increase the pre-tax net profit when the New Taiwan Dollar depreciates by 1% relative to each related foreign currency; when the New Taiwan Dollar appreciates by 1% relative to each related foreign currency, its impact on the pre-tax net profit will be a negative number of the same amount.

The effect of USD/RMB/EUR (note) 2020 2019 Profit and loss $ 2,789 $ 3,069

Note: It mainly comes from the consolidated company’s cash and

cash equivalents, accounts receivable, other receivables,

short-term loans, accounts payable and other payables denominated in foreign currencies that are still outstanding on the balance sheet date without cash flow hedging.

The management believes that the sensitivity analysis cannot represent the inherent risk of exchange rate, because the foreign currency exposure on the balance sheet date cannot reflect the medium-term exposure. Therefore, the management will still conduct exchange rate risk management in accordance with the policies of the Company.

(2) Interest rate risk

Interest rate exposure is caused by the fact that entities in the Company borrow funds at fixed and floating rates and hold current and foreign currency bank deposits. The management of the Company shall regularly monitor the interest rate risk. If required, necessary measures shall be taken for significant interest rate risks to control risks arising from the change of market interest rate.

The carrying amounts of the financial assets and financial liabilities of the Company subject to interest rate exposure on the balance sheet date are as follows:

Interest rate risks with fair value - Financial assets - Financial liabilities Interest rate risks with cash flow - Financial assets - Financial liabilities	December 31, 2020 $ - 555,122 161,410 355,453	December 31, 2019
		$ 30,010 567,400 114,702 345,993

Sensitivity analysis

The following sensitivity analysis is based on the interest rate exposure of non-derivative instruments on the balance sheet date. For floating rate assets and liabilities, it is assumed that the

amount of assets and liabilities outstanding on the balance sheet date is also outstanding during the reporting period.

If the interest rate increases/decreases by 0.1%, and all other variables remain unchanged, the pre-tax net profit of the consolidated company for 2020 will decrease/increase by NTD 194 thousand; the pre-tax net profit for 2019 will decrease/increase by NTD 231 thousand, mainly due to the interest rate risk of floating interest assets and liabilities of the Consolidated company.

2. Credit risk

Credit risk refers to the risk of financial loss caused by default of contractual obligations of the counterparty. As of the balance sheet date, the maximum credit risk exposures (excluding collateral or other credit enhancement tools, and the maximum amount of irrevocable exposure) of the Company that may cause financial losses due to the failure of the counterparty and the financial guarantee provided by the Company mainly come from:

(1) Book value of financial assets recognized in the individual balance sheet.
(2) The maximum amount that the Company may be required to pay for the provision of financial guarantees, regardless of the likelihood of occurrence.

Operation related credit risk and financial risk are managed separately.

Operation related credit risk

In order to maintain the quality of accounts receivable, the Company has established operations related procedures for credit risk management.

The risk assessment of an individual customer is to consider many factors that may affect the customer’s ability to pay, including the customer’s financial status, the credit rating by credit rating agencies, the Company’s internal credit rating, the historical transaction records and current economic conditions. The Company will also use certain

credit enhancement tools, such as advance payment, at the appropriate time to reduce the credit risk of specific customers.

Financial credit risk

The credit risk of bank deposits, fixed income investments and other financial instruments is measured and monitored by the financial department of the Company. Since the trading partners and performing parties of the Company are all banks and financial institutions with good credit, company organizations and government agencies which have no significant performance concern, there is no significant credit risk.

3. Liquidity risk

The objective of the Company on the management of the liquidity risk is to maintain the cash and cash equivalents, high liquidity securities and sufficient bank credit facilities required for operation, so as to ensure that the Company has sufficient financial flexibility.

The Company shall regularly review the inventory level, turnover rate of various types of inventory, credit conditions of customers and turnover rate of accounts receivable to control the size of working capital. The cash and cash equivalent level of the group remains moderately loose, and funds are raised in advance according to capital demand and a low debt ratio and financial flexibility are maintained, so as to effectively control the liquidity risk.

(1) Statement of liquidity and interest rate risk of non-derivative financial liabilities

The maturity analysis of the remaining contracts of non-derivative financial liabilities is based on the undiscounted cash flow (including principal and estimated interest) of financial liabilities on the earliest possible repayment date of the Company. Therefore, the series of bank loans that the Company may be required to repay immediately shall not take into account the probability of the bank executing the right immediately in the earliest period in the table below; the maturity analysis of other

non-derivative financial liabilities shall be prepared according to the agreed repayment date.

December 31, 2020

Less than 1 month	1~3 months	3	months to 1 year	1 to 5years	More than 5 years	Total
	$ 94,922 183 21,181 120,186 $ 236,472 1~3 months	3	$ 64,881 434 52,669 53,191 $ 171,175 months to 1 year	$ - 303 197,408 272,900 $ 470,611 1 to 5years	$ - - 87,194 - $ 87,194 More than 5 years	$ 254,664 1,060 358,452 566,344 $ 1,180,520 Total

$ 105,390 118 - 281,885 $ 387,393	$ 64,022 256 17,708 - $ 81,986		$ 28,640 1,154 55,053 - $ 84,847	$ 54,516 1,049 184,857 300,000 $ 540,422	$ - - 99,743 - $ 99,743	$ 252,568 2,577 357,361 581,885 $ 1,194,391

(2) Credit facilities

Credit facilities
Short-term bank credit facilities - Amount used - Amount unused	December 31, 2020 $ 469,378 310,622 $ 780,000	December 31, 2019
			$ 436,609 363,391 $ 800,000

31. Related party transactions

Except as disclosed in other notes, significant transactions between the Company and its related parties are as follows.

(1) Name and relationship of related parties

Name of related art Relationshi with the Com an p y p p y Adhesive Technologies, Inc. Corporate director of the Company (Adhesive Technologies) Wuxi More Tex Technology Co., Ltd. Joint venture (Wuxi More Tex) Tex Year Industrial Adhesives Pvt. Joint venture Ltd. (Tex Year Industrial Adhesives) Wood Glue Industrial Co., Ltd. The chairman of this company is a director of the Company

Name of relatedparty Relationshipwith the Company Vic Hung Petroleum Chemical Co., Ltd The chairman of this company is the spouse of a director of the Company JPT Cooperation (JPT Cooperation) The chairman of this company is a director of the Company (Non-related party since July 1, 2020) Tex Year Fine Chemical (Guangzhou) Co., Ltd. (Tex Year Guangzhou) Subsidiary Wuxi Tex Year International Trading Co., Ltd. Subsidiary Tex Year Technology (Jiangsu) Co., Ltd. (Tex Year Jiangsu) Subsidiary Tex Year Europe Sp. z o. o. (Tex Year Europe) Subsidiary Tex Year (Hong Kong) Ltd. (Tex Year (Hong Kong)) Subsidiary Tex Year Vietnam Co., Ltd. (Tex Year Vietnam) Subsidiary Shanghai C&M Filtration Solutions Limited (Shanghai C&M ) Subsidiary Jiangsu C&M Filtration Solutions Limited Subsidiary (2) Operating income Account items Category/name of relatedparty 2020 2019 Sales revenue Subsidiary Tex Year Guangzhou $ 62,884 $ 80,381 Tex Year Europe 39,316 7,370 Tex Year (Hong Kong) 32,445 31,384 Others 34,582 54,001 169,227 223,136 Corporate director of the Company Adhesive Technologies 105,455 80,048 Joint venture 7,415 6,030 The chairman of this company is a director of the Company - 20 $ 282,097 $ 309,234	Relationshipwith the Company	Relationshipwith the Company	Relationshipwith the Company
			$ 80,381 7,370 31,384 54,001 223,136 80,048 6,030 20 $ 309,234

For related parties, except part of the products which have the same selling prices as those of general customers, the selling prices of other products are increased by a certain proportion according to the product type and cost and based on the individual credit conditions of related parties.

(3) Purchase

hase
Category/name of related party 2020 2019 Subsidiary Tex Year Vietnam $ 53,276 $ 9,007 Tex Year Guangzhou 14,340 51,486 Others 826 1,175 68,442 61,668 The chairman of this company is a director of the Company 41 113 $ 68,483 $ 61,781 For related parties, except part of the products which have the same selling prices as those of general customers, the selling prices of other products are increased by a certain proportion. eivables from related parties Account items Category/name of relatedparty December 31, 2020 December 31, 2019 Accounts receivable - related parties Subsidiary Tex Year Guangzhou $ 27,514 $ 22,841 Tex Year Europe 15,764 34,223 Tex Year (Hong Kong) 12,039 7,730 Others 8,273 15,298 63,590 80,092 Corporate director of the Company Adhesive Technologies 29,838 14,076 Joint venture 2,496 1,872 $ 95,924 $ 96,040			2019
		$ 22,841 34,223 7,730 15,298 80,092 14,076 1,872 $ 96,040

For related parties, except part of the products which have the same selling prices as those of general customers, the selling prices of other products are increased by a certain proportion.

(4) Receivables from related parties

For sales to the Company’s corporate directors, the Company’s terms of payment are 75 days T/T on delivery; for sales to subsidiaries, the

Company’s terms of payment are 120 days per month; for sales to joint ventures and subsidiaries, the Company’s terms of payment are 90 days T/T on delivery.

Guarantees for the outstanding receivables from related parties are not collected.

(5) Payables to related parties

Account items Accounts payable - related parties	Category/name of relatedparty Subsidiary Tex Year Vietnam Others	December 31, 2020 $ 15,927 1,366 $ 17,293	December 31, 2019	December 31, 2019
				$ 653 8,817 $ 9,470

The payment terms are 120 days per month for purchases from a subsidiary and 40 days per month for purchases from a company whose chairman is a director of the Company.

Guarantees for the balance of outstanding payables to related parties are not collected.

(6) Others

The balance of other receivables from related parties on the balance sheet date is as follows:

sheet date is as follows:
Category/name of related party Subsidiary Tex Year Jiangsu Tex Year Vietnam Others Joint venture Wuxi More Tex Tex Year Industrial Adhesives The chairman of this company is a director of the Company JPT Cooperation	December 31, 2020 $ 21,580 1,292 1,068 23,940 703 357 1,060 - $ 25,000	December 31, 2019
			$ 21,632 15,178 1,181 37,991 1,963 218 2,181 13 $ 40,185

Other receivables consist of loans of funds (see Table 1), payments for technical management services, payments for equipment purchased on behalf of the Company, and advances on behalf of the Company.

The balance of other payables to related parties on the balance sheet date is as follows:

is as follows:
Category/name of related party Subsidiary Tex Year Guangzhou The chairman of this company is a director of the Company JPT Cooperation Other income: Category/name of related party Subsidiary Tex Year (Hong Kong) Tex Year Vietnam Others Joint venture Wuxi More Tex Tex Year Industrial Adhesives	December 31, 2020 $ - - $ - 2020 $ 1,751 1,654 703 4,108 5,475 1,201 6,676 $ 10,784	December 31, 2019
			$ 3 69 $ 72 2019
			$ 1,603 1,421 443 3,467 8,343 1,328 9,671 $ 13,138

Other income is mainly income from the provision of technical management services to subsidiaries and joint ventures and is recorded as management and technical service fees.

(7) Rewards to key management

wards to key management
Short-term employee benefits Post-employment benefits		2020 $ 19,967 2,595 $ 22,562		2019
				$ 19,128 2,475 $ 21,603

The compensation of directors and other key management is determined

by the Compensation Committee in accordance with individual performance and market trends.

32. Pledged assets

The following assets of the Company have been provided as collateral for the issuance of corporate bonds and bank loans.

Demand deposits (financial assets measured at cost after amortization - non-current) Land Houses and buildings - net	December 31, 2020 $ 76 91,041 309,016 $ 400,133	December 31, 2019	December 31, 2019
			$ 20,000 91,041 303,475 $ 414,516

33. Significant contingent liabilities and unrecognized contractual commitments

Except as stated in other notes, the Company has the following major commitments and contingencies on the balance sheet date:

(1) Amount of unused letter of credit opened:

NTD USD JPY EUR	December 31, 2020 $ 41,249 7,131 254 -	December 31, 2019
		$ 21,587 65 - 31

The Company appoints banks as the guarantors for contract performance, customs duty and goods tax bookkeeping. The guaranteed amount on December 31, 2020 and 2019 are respectively NTD 29,620 thousand and NTD 28,600 thousand.

Information on foreign currency financial assets and liabilities with significant impact

The following information is summarized and expressed in foreign currencies other than the functional currencies of each entity of the Company. The disclosed exchange rate refers to the exchange rate converted from such foreign currencies to the functional currencies. Foreign currency assets and liabilities with significant impact are as follows:

December 31, 2020

December 31, 2020
Foreign currency Exchange rate Foreign currency assets Monetary items USD $ 7,347 28.09 (USD:NTD) EUR 1,543 34.56 (EUR:NTD) JPY 9,735 0.2725 (JPY:NTD) RMB 11,654 4.3160 (RMB:NTD) Non-monetary items Share of income of subsidiary and joint venture under the equity method VND 57,657,564 0.0012 (VND:NTD) INR 58,274 0.3837 (INR:NTD) HKD 22,156 3.6240 (HKD:NTD) PLN 18,124 7.5558 (PLN:NTD) Foreign currency liabilities Monetary items USD 1,058 28.09 (USD:NTD) JPY 25,387 0.2725 (JPY:NTD) RMB 317 4.3160 (RMB:NTD) December 31, 2019 Foreign currency Exchange rate Foreign currency assets Monetary items USD $ 7,522 30.01 (USD:NTD) EUR 1,956 33.66 (EUR:NTD) JPY 13,466 0.2762 (JPY:NTD) RMB 9,146 4.3010 (RMB:NTD) Non-monetary items	Exchange rate	Carrying amount

Share of income of subsidiary and joint venture under the equity method VND INR HKD PLN Foreign currency liabilities
Monetary items USD JPY RMB December 31, 2019
Foreign currency assets Monetary items USD EUR JPY RMB Non-monetary items

(Continue)

Share of income of subsidiary and joint venture under the equity method VND INR HKD PLN Foreign currency liabilities Monetary items USD EUR JPY RMB	Foreign currency 50,238,386 53,321 22,270 17,173 583 94 5,142 772	Exchange rate 0.0013 (VND:NTD) 0.4219 (INR:NTD) 3.8570 (HKD:NTD) 7.9227 (PLN:NTD) 30.01 (USD:NTD) 33.66 (EUR:NTD) 0.2762 (JPY:NTD) 4.3010 (RMB:NTD)		Carrying amount
				$ 65,311 22,496 85,897 136,056 $ 309,760 $ 17,498 3,163 1,420 3,322 $ 25,403

The foreign currency exchange losses (realized and unrealized) of the consolidated company for 2020 and 2019, was respectively NT$8,721 thousand and NT$6,471 thousand. Due to the wide variety of foreign currency transactions and the functional currencies of group entities, it is impossible to disclose the exchange gains and losses by foreign currencies with major impacts.

35. Disclosure in notes

(1) Major transactions and (2) related information on reinvested enterprises:
Loans of funds to others. (Table 1)
Endorsements/guarantees for others. (Table 2)
Securities held at the end of the period (excluding investment in subsidiaries and affiliated enterprises and equity of joint ventures). (Table 3)
The accumulated amount of buying or selling the same securities amounts to NT$300 million or more than 20% of the paid-in capital: None.
The amount of property acquired reaches NT$300 million or more than 20% of the paid-in capital: None.
The amount of property disposed of reaches NT$300 million or more than 20% of the paid-in capital: None.
The amount of goods purchased or sold with related parties is NT$100 million or more than 20% of the paid-in capital. (Table 4)
Receivables from related parties reach NT$100 million or more than 20% of paid-in capital: None.
Engagement in derivatives transactions:

As of the end of 109, the outstanding exchange rate swap contracts

of subsidiaries without hedge accounting were as follows

Contract amount (NT$1,000) EUR1,481/PLN6,293	Due date 2021.1.10~2023.8.9	Range of interest rate paid 3.45%	Range of interest rate received
			WIBOR3M+3%

Information of invested company. (Table 6)
(3) Mainland China Investment Information:
Name of the investee company in Mainland China, main business items, paid-in capital, investment method, capital remittance, shareholding ratio, investment gain or loss, carrying amount of investment at the end of the period, remittance of investment gain or loss, and investment limit in Mainland China. (Table 7)
Major transactions with the mainland China invested company directly or indirectly through a third region, and their prices, payment terms, unrealized profits and losses: (Table 1, Table 2, Table 4, and Table 5)
- (1) Purchase amount and percentage, and period-end balance and percentage of related payables.
- (2) Amount and percentage of goods sold, and period-end balance and percentage of related receivables.
- (3) The amount of asset transaction and the profit or loss arising therefrom.
- (4) The period-end balance and the purpose of bill endorsement /
  - guarantee or provision of collateral.
(5) The maximum balance of financing, the period-end balance, the interest rate range and the total interest of the current period.
(6) Other transactions that have a significant impact on the current income or financial position.
(4) Information of major shareholders: names of shareholders with a shareholding ratio of more than 5%, the number of shares held and the percentage. (Table 8)

36. Segment Information

The Company’s individual financial statements are prepared in accordance with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers and are exempt from the presentation of segment information under International Financial Reporting Standard No. 8.

Tex Year Industries Inc.

Loans of funds to others

2020

Table 1

In thousand of New Taiwan Dollars, unless otherwise noted.

Serial No. (Note 1)	Lending company	Loan recipient	Transaction item (Note 2)	Related party or not	Maximum balance of the current period (Note 3)	Ending balance (Note 8)	Actual drawdown amount (Note 9)	Interest rate range	Loan and nature (Note 4)	Business transaction amount (Note 5)	Reason for short-term financing (Note 6)	Provisions for bad debts	Collateral	Collateral	Loans and limits to individual objects (Note 7)	Loan and total limit (Note 7)	Remarks
													Name	Value
0 0 1 1 2	Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Technology Corp. Tex Year Technology Corp. Tex Year (Hong Kong) Ltd.	Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Europe Sp. z o. o. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co.,Ltd.	Other receivables - related party - other Other receivables - related party - other Other receivables - related party - other Other receivables - related party - other Other receivables - related party - other	Yes Yes Yes Yes Yes	$ 34,000 60,000 66,000 20,000 43,000	$ 34,000 - 50,000 20,000 43,000	$ 21,580 ( RMB 5,000 thousand ) - - 15,106 ( RMB 3,500 thousand ) 36,517 ( USD 1,300 thousand )	3% - 2.5% 2.5% 2.5%	Short term financing funds Short term financing funds Short term financing funds Short term financing funds Short term financing funds	$ - - - - -	Operation turnover Operation turnover Operation turnover Operation turnover Operation turnover	$ - - - - -	- - - - -	- - - - -	$ 1,140,767 228,153 986,055 986,055 80,516	$ 1,140,767 228,153 986,055 986,055 80,516

Note 1: The description of the number column is as follows:

(1) Fill in 0 for the issuer.
(2) Investee companies are numbered in sequence in each company type starting from Arabic numeral 1.

Note 2: This field must be filled in for accounts receivable from affiliated enterprises, receivables from related parties, transactions with shareholders, prepayments, provisional payments, etc. if the nature is loan to others. Note 3: The maximum balance of loans to others in the current year.

Note 4: The loan nature shall be filled in if it is a business transaction or if there is a need for short-term financing.

Note 5: Where the nature of the loan is a business transaction, the amount of the business transaction shall be filled in. The business transaction amount refers to the amount of business transactions between the lending company and the loan recipient in the most recent year.

Note 6: If the nature of the loan is necessary for short-term financing, the reason for the loan and the purpose of the loan borrower shall be specified, such as loan repayment, purchase of equipment, business turnover, etc.

Note 7: In accordance with the Procedures of Loans to Others, the total amount of loans shall not exceed 50% of the Company’s net worth, but the total amount of loans to others due to the necessity of short-term financing between companies or between firms shall not exceed 40% of the Company’s net worth; the amount of loans to each individual company or firm necessary for short-term financing shall not exceed 20% of the Company’s net worth When it is necessary for a foreign company directly or indirectly holding 100% of the voting shares of the Company to engage in short-term financing of funds, the amount is not be subject to the restrictions above, but the maximum amount shall not exceed the net value of the lending company. Tex Year Technology Corp. has a net loan amount of NTD 986,055 thousand, which is NTD 1,627 thousand different from the book amount of NTD 984,428 thousand held by the Company in Table 6; the difference is the unrealized gross profit on sales; Tex Year (Hong Kong) Ltd. has a net loan amount of NTD 80,516 thousand, which is NTD 222 thousand different from the book amount of NTD 80,294 thousand held by the Company in Table 6; the difference is the unrealized gross profit on sales.

Note 8: If a public company submits its lending to the board of directors’ meeting for resolution one by one in accordance with paragraph 1, Article 14 of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies, the amount of the resolution of the board of directors’ meeting shall be included in the announced balance to disclose the risks it bears before the funds are lent out; if the funds are repaid later, the balance after repayment shall be disclosed to reflect the adjustment of risks. If the board of directors’ meeting of a public company authorizes the chairman of the board to extend loans in several trenches or recycle the loan balance within a certain limit in a year in accordance with paragraph 2, Article 14 of the Regulations, the loan limit approved by the board of directors’ meeting shall still be used as the balance for the public announcement and declaration. Although the funds will be repaid later, other loans may still be extended again, so the loan limit approved by the board of directors’ meeting shall still be used as the balance for the public announcement and declaration.

Note 9: It was converted at the exchange rates of RMB and USD on December 31, 2020.

Tex Year Industries Inc.

Endorsements/guarantees for others

2020

In thousand of New Taiwan Dollars, unless otherwise noted.

Table 2

Serial No. (Note 1)	Endorsement guarantor Name of the Company	Endorsement/guarantee object	Endorsement/guarantee object	Single enterprise endorsement/guar antee Limit (note 3)	Maximum balance of the current period endorsement/guar antee (Note 4)	Ending balance of endorsement/guar antee (Note 5)	Actual drawdown amount (Note 6)	Secured by property Amount of endorsements/gua rantees	Accumulated endorsement /guarantee Amount to Net value in the latest financial statements Percentage %	endorsement/ guarantee limits (Note 3)	parent company to subsidiari es endorsem ent/guar antee (Note 7)	subsidiary to parent company endorsem ent/guara ntee (Note 7)	for Mainland China endorsem ent/guar antee (Note 7)	Remarks
		Name of the Company	Relationship (note 2)
0 0 0 0 0 0	Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc.	Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Europe Sp. z o. o. Tex Year Vietnam Co., Ltd. Shanghai C&M Filtration Solutions Limited	2 2 2 2 2 2	$ 342,230 342,230 342,230 228,153 228,153 228,153	$ 30,350 ( USD 1,000 thousand ) 60,460 ( USD 2,000 thousand ) 86,660 ( RMB 20,000 thousand ) 70,280 ( EUR 2,000 thousand ) 80,428 ( USD 2,650 thousand ) 1,733 (RMB400 thousand )	$ 28,090 ( USD 1,000 thousand ) 56,180 ( USD 2,000 thousand ) 86,320 ( RMB 20,000 thousand ) 69,120 ( EUR 2,000 thousand ) 74,439 ( USD 2,650 thousand ) 1,726 ( USD400 thousand )	$ 19,406 ( USD691 thousand ) 56,180 ( USD 2,000 thousand ) 62,859 ( RMB 14,564 thousand ) 62,554 ( EUR 1,810 thousand ) 20,257 ( USD721 thousand ) 1,726 ( USD400 thousand )	$ - - - - - -	2.46% 4.92% 7.57% 6.06% 6.53% 0.15%	$ 570,383 570,383 570,383 570,383 570,383 570,383	Y Y Y Y Y Y	N N N N N N	Y Y Y N N Y	Note 8 Note 8 Note 8

Note 1: The description of the number column is as follows:

(1) Fill in 0 for the issuer.
(2) Investee companies are numbered in sequence in each company type starting from Arabic numeral 1.
Note 2: There are 7 kinds of relations between the endorsement guarantor and the endorsement/guarantee object indicated as follows:
(1) A company with business contacts.
(2) A company with more than 50% of its voting shares directly and indirectly held by the Company.
(3) A company directly or indirectly holding more than 50% of the voting shares of the Company.
(4) Companies directly or indirectly holding more than 90% of the voting shares of each other.
(5) A company with mutual guarantees in accordance with the contract which is in the same industry or a joint producer for the purpose of contracting the project.
(6) A company that has been endorsed/guaranteed by all the contributing shareholders in accordance with their shareholding ratios due to a joint investment relationship.
(7) Joint and several guarantees for the performance of a contract for the sale of pre-sold houses among companies in the same industry in accordance with the provisions of the Consumer Protection Act.
Note 3: According to the Company’s “Measures on Endorsements/guarantees”, the total amount of external endorsements/guarantees shall not exceed 50% of the Company’s net value, and the limit of endorsements/guarantees for a single enterprise shall not exceed 20% of the Company’s net value. However, for subsidiaries directly or indirectly owned by the Company, the limit shall not exceed 30% of the Company’s net value.
Note 4: The maximum balance of endorsements/guarantees for others in the current year.
Note 5: The amount approved by the board of directors’ meeting shall be filled in. However, if the board of directors’ meeting authorizes the chairman of the board to make a decision in accordance with paragraph 8, Article 12 of the Regulations Governing Loaning of Funds and Making of Endorsements/ Guarantees by Public Companies, it refers to the amount decided by the chairman of the board.

Note 6: The actual amount of the Company’s disbursement within the range of using the balance of the endorsements/ guarantees shall be entered.

Note 7: Y is required only for those which are endorsements/guarantees of a listed parent company to subsidiaries, endorsements/guarantees of subsidiaries to a listed parent company, and endorsements/guarantees in mainland China.

Note 8: Among them, RMB20,000 thousand is the bank credit line of E.Sun Bank shared by Tex Year Fine Chemical (Guangzhou) Co., Ltd. and Tex Year Technology (Jiangsu) Co., Ltd.

Tex Year Industries Inc.

Securities held at the end of the period

December 31, 2020

Table 3

In thousand of New Taiwan Dollars, unless otherwise noted.

Holding company	Types and names of securities (note 1)	Relationship with the securities issuer(note 2)	Account items		End ofperiod	End ofperiod		Remarks
				Unit/share (thousand shares)	Book amount (Note 3)	Shareholding ratio(%)	Fair value
Tex Year Industries Inc.	Acute Touch Technology Co., Ltd	-	Financial assets measured at fair value through other comprehensive income - non-current	1,500	$ -	3	$ -	Note 4

Note 1: The term “securities” in this table refers to the stocks, bonds, beneficiary certificates and securities derived from the above items within the scope of IFRS 9 “Financial instruments.” Note 2: If the issuer of securities is not a related party, this column is not required to be filled in.

Note 3: If measured at fair value, the book amount is the book balance after adjustment of fair value evaluation and deduction of loss provision; if not measured at fair value, the book amount is the book balance of cost

after amortization (after deduction of loss provision).

Note 4: There is no pledge.

Note 5: Please refer to attached Tables 6 and 7 for information on investment in subsidiaries, affiliated enterprises and equity joint ventures.

Tex Year Industries Inc.

The amount of goods purchased or sold with related parties is NT$100 million or more than 20% of the paid-in capital:

2020

Table 4

In thousand of New Taiwan Dollars, unless otherwise noted.

Purchase (Sales) company	Transaction counterparty	Relationship		Transaction situation	Transaction situation		Trading conditions are different from normal trading Situation and reasons	Trading conditions are different from normal trading Situation and reasons	Accounts and notes receivable (payable)	Accounts and notes receivable (payable)	Remarks
			Purchase (Sales)	Amount	Amounted to purchase (sales) Percentage %	Credit period	Unit price	Credit period	Balance	Accounted to total accounts and notes receivable (payable) Percentage %
Tex Year Industries Inc. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd.	AD-TECH Wuxi Tex Year International Trading Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Wuxi More Tex Technology Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Wuxi Tex Year International Trading Co., Ltd.	Corporate director of the Company 100% owned subsidiary of the Company Parent company Associated company Associated company Associated company	Sales Sales Purchase Purchase Purchase Sales	( $ 105,455 ) ( 101,415 ) 101,415 180,394 161,196 ( 161,196 )	( 3% ) ( 3% ) 3% 6% 5% ( 5% )	Payment due in 60 days after delivery T/T Remittance - - Payment due in 90 days after delivery T/T Remittance - -	- Cost markup Cost markup - Cost markup Cost markup	- Credit on 120 days Credit on 120 days - Credit on 120 days Credit on 120 days	$ 29,838 38,908 ( 38,908 ) ( 13,596 ) ( 35,082 ) 35,082	5% 6% ( 9% ) ( 3% ) ( 8% ) 5%

Tex Year Industries Inc.

Business relationship between the parent and the subsidiary companies and among subsidiaries, as well as important transactions and amounts

2020

Table 5

In thousand of New Taiwan Dollars, unless otherwise noted.

Serial No. (Note 1)	Name of counterparty	Transaction counterparty	Relationship with the counterparty (Note 2)		Transaction situation	Transaction situation
				Accounting subject	Amount (Note 4)	Terms of transaction	Ratio to total consolidated revenue or total assets (Note 3 and 5)
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1	Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Industries Inc. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co.,Ltd.	Tex Year (Hong Kong) Ltd. Tex Year (Hong Kong) Ltd. Tex Year (Hong Kong) Ltd. Tex Year Vietnam Co., Ltd. Tex Year Vietnam Co., Ltd. Tex Year Vietnam Co., Ltd. Tex Year Vietnam Co., Ltd. Tex Year Europe Sp. z o. o. Tex Year Europe Sp. z o. o. Wuxi Tex Year International Trading Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year (Hong Kong) Ltd. Tex Year (Hong Kong) Ltd. Wuxi Tex Year International Trading Co., Ltd. Wuxi Tex Year International Trading Co.,Ltd.	1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 3 3 3 3	Accounts receivable Operating income Management service fee Accounts payable Accounts receivable Operating income Purchase Accounts receivable Operating income Accounts receivable Operating income Accounts receivable Operating income Purchase Operating income Other receivable Purchase Other Payable Accounts payable Accounts receivable	$ 12,039 32,445 1,751 15,927 4,258 10,723 53,276 15,764 39,316 2,740 14,849 27,514 62,884 14,340 3,495 21,580 2,056 36,517 1,548 38,908	- Cost markup - - - Cost markup Cost markup - Cost markup - Cost markup - Cost markup Cost markup Cost markup - Cost markup - - -	0.4% 1.0% 0.1% 0.5% 0.1% 0.3% 1.7% 0.5% 1.2% 0.1% 0.5% 0.9% 2.0% 0.5% 0.1% 0.7% 0.1% 1.2% 0.1% 1.3%

Serial No. (Note 1)	Name of counterparty	Transaction counterparty	Relationship with the counterparty (Note 2)		Transaction situation	Transaction situation
				Accounting subject	Amount (Note 4)	Terms of transaction	Ratio to total consolidated revenue or total assets (Note 3 and 5)
1 1 1 1 1 1 1 1 1 1 2 2 2 3 3 3 3 4	Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Shanghai C&M Filtration Solutions Limited Shanghai C&M Filtration Solutions Limited Shanghai C&M Filtration Solutions Limited Shanghai C&M Filtration Solutions Limited Tex Year Technology (Jiangsu)Co.,Ltd.	Wuxi Tex Year International Trading Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Shanghai C&M Filtration Solutions Limited Tex Year Vietnam Co., Ltd. Tex Year Europe Sp. z o. o. Tex Year Europe Sp. z o. o. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Jiangsu C&M Filtration Solutions Limited Jiangsu C&M Filtration Solutions Limited Jiangsu C&M Filtration Solutions Limited Tex Year TechnologyCorp.	3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3	Operating income Purchase Accounts payable Accounts receivable Operating income Purchase Purchase Operating income Accounts receivable Operating income Accounts payable Operating income Purchase Purchase Accounts payable Operating income Purchase Other Payable	101,415 11,066 17,076 2,932 7,678 90,006 2,970 2,380 1,554 4,924 35,082 5,164 161,196 12,165 34,876 32,930 77,368 15,106	Cost markup Cost markup - - Cost markup Cost markup Cost markup Cost markup - Cost markup - Cost markup Cost markup Cost markup - Cost markup Cost markup -	3.2% 0.3% 0.6% 0.1% 0.2% 2.8% 0.1% 0.1% 0.1% 0.2% 1.1% 0.2% 5.1% 0.4% 1.1% 1.0% 2.4% 0.5%

Note 1: The business information between the parent company and the subsidiaries shall be indicated in the number column respectively, and the number shall be filled in as follows: 1. Fill in 0 for the parent company.
Subsidiaries are numbered in sequence in each company type starting from Arabic numeral 1.
Note 2: There are three types of relationship between the counterparties, which can be indicated as follows:
Parent company and subsidiary company.
Subsidiary company and parent company.
Subsidiary company and subsidiary company.
Note 3: For the calculation of the ratio of the transaction amount to the total consolidated revenue or total assets, if it belongs to the account of assets and liabilities, it shall be calculated in the way that the ending balance accounts for the total consolidated assets; if it belongs to the account of income, it shall be calculated in the way that the accumulated amount in the period accounts for the total consolidated revenue.
Note 4: The related transactions have been written off in the consolidated financial statements.

Note 5: Other transactions account for less than 0.1% of the total assets or consolidated revenue, and will not be disclosed.

Tex Year Industries Inc.

Name of investment company, location, etc.

2020

Table 6

In thousand of New Taiwan Dollars, unless otherwise noted.

Name of investment company	Name of investee	Location	Main business items	Original investment amount (note 1)	Original investment amount (note 1)	Held at end of the period	Held at end of the period	Held at end of the period	Investee Profit (loss) of the current period	Recognized in the current period Investmentprofit(loss)	Remarks
				End of the period	End of last year	Number of shares (1,000 shares)	Percentage %	Carrying amount (Note 2)
Tex Year Industries Inc. Tex Year International (SAMOA) Corp. Tex Year (Hong Kong) Ltd.	Tex Year International (SAMOA) Corp. Tex Year (Hong Kong) Ltd. Tex Year Vietnam Co., Ltd. Tex Year Industrial Adhesives Pvt. Ltd. Tex Year Europe Sp. z o. o. Tex Year Technology (Samoa) Corp. Tex Year Technology (Samoa)Corp.	Samoa Hong Kong Vietnam India Poland Samoa Samoa	Holding company Sales of hot melt adhesive, adhesive and various appliances Manufacturing and trading of hot melt adhesives and water adhesives Sales and manufacturing of hot melt adhesive, sales of adhesive and various appliances R&D, production and sales of hot melt adhesives Holding company Holding company	$ 782,923 ( USD 24,500 thousand ) 33,735 ( USD 1,000 thousand ) 44,920 ( USD 1,440 thousand ) 15,029 ( USD 500 thousand ) 145,537 ( PLN 17,600 thousand ) 782,923 ( USD 24,800 thousand ) 34,501 (USD 1,000 thousand)	$ 782,923 ( USD 24,500 thousand ) 33,735 ( USD 1,000 thousand ) 44,920 ( USD 1,440 thousand ) 15,029 ( USD 500 thousand ) 145,537 ( PLN 17,600 thousand ) 782,923 ( USD 24,800 thousand ) 34,501 (USD 1,000 thousand)	- 8,010 - 72 17.6 - -	100.00 100.00 80.00 50.00 80.00 96.08 3.92	$ 947,398 80,294 69,190 22,360 136,943 947,394 37,034	$ 66,594 ( 1,374 ) ( HKD (361) thousand) 11,522 ( VND 8,863,257 thousand) 4,628 ( INR 11,645 thousand) 9,274 ( PLN 1,226 thousand) 66,594 66,594	$ 66,594 ( 1,374 ) ( HKD (361) thousand) 9,218 ( VND 7,090,605 thousand) 2,314 ( IND 5,823 thousand) 7,419 ( PLN 981 thousand) 66,594 -	(Note 3) (Note 3)

Note 1: It is calculated according to the original investment cost.

Note 2: The unrealized gross profit of goods sold has been deducted.

Note 3: The total net profit of this period of Tex Year Technology (SAMOA) Corp. is recognized under Tex Year International (SAMOA) Corp. Note 4: Please refer to Table 7 for information about reinvested companies in mainland China.

Tex Year Industries Inc.

Mainland China Investment Information

2020

Table 7

In thousand of New Taiwan Dollars, unless otherwise noted

Investee in mainland China Name of the Company	Main business items	Paid-in capital (Note 1)	Paid-in capital (Note 1)	Investment mode	Beginning of the period Remitted from Taiwan Accumulated investment amount	Beginning of the period Remitted from Taiwan Accumulated investment amount	Remitted out or recovered in Amount of investment	Remitted out or recovered in Amount of investment	End of the period Remitted from Taiwan Accumulated investment amount	Investee Profit and loss of the current period	Shareholding ratio of direct or indirect investment of the Company	Recognized in the current period Loss and profit (Note 10)	Investment at the end of the period Carrying amount	As of the current period Investment income repatriated	Remarks
							Outward remittance	Recovery
Wuxi More Tex Technology Co., Ltd. Deyuan Chemical Technology (Shenzhen) Co., Ltd. Deyuan Business Machine (Shenzhen) Co., Ltd. Tex Year Fine Chemical (Guangzhou) Co., Ltd. Wuxi Tex Year International Trading Co., Ltd. Tex Year Technology (Jiangsu) Co., Ltd. Shanghai C&M Filtration Solutions Limited Jiangsu C&M Filtration Solutions Limited	Development, production and sales of hot melt adhesives and lubricants Development, production and sales of hot melt adhesives and lubricants Development and production of laminators, shredders, and manufacturing and trading of various appliances. R&D, production and sales of hot melt adhesives Sales of chemical products and adhesives R&D, production and sales of hot melt adhesives R&D and sales of environmental protection filter materials R&D and manufacturing of non-gauze filter materials	$ 100,581 ( USD 3,000 thousand ) - - 389,798 ( USD 12,000 thousand ) 14,265 ( RMB 3,000 thousand ) 308,108 ( USD 10,000 thousand ) 124,839 ( RMB 27,298 thousand ) 107,160 ( RMB 23,340 thousand )		Note 4 - - Note 5 Note 6 Note 7 Note 6 Note 12	$ 50,291 ( USD 1,500 thousand ) 34,507 ( USD 1,000 thousand ) 34,726 ( USD 1,000 thousand ) 389,798 ( USD 12,000 thousand ) - 308,108 ( USD 10,000 thousand ) - -		$ - - - - - - - -	$ - - - - - - - -	$ 50,291 ( USD 1,500 thousand ) 34,507 ( USD 1,000 thousand ) 34,726 ( USD 1,000 thousand ) 389,798 ( USD 12,000 thousand ) - 308,108 ( USD 10,000 thousand ) - -	$ 5,851 ( RMB 1,370 thousand ) - - 62,535 ( RMB 14,638 thousand ) 2,230 ( RMB522 thousand) 14,952 ( RMB3,500 thousand ) 58,847 ( RMB 13,774 thousand ) 11,180 ( RMB 2,617 thousand )	50% - - 100% 100% 100% 50.10% 100%	( $ 6,713 ) ( RMB (1,571) thousand ) - - 62,347 ( RMB 14,594 thousand ) 2,230 ( RMB522 thousand ) 13,557 ( RMB 3,173 thousand ) 27,308 ( RMB 6,392 thousand ) 11,180 ( RMB 2,617 thousand )	$ 102,214 - - 540,158 60,858 281,507 88,465 111,608	$ 108,323 (Note 2) None. None. None. None. None. None. None.	Note 9 and 10 Note 8 Note 8 Note 10 and 13 Note 10 Note 10 and 14 Note 10 and 11 Note 10

Accumulated amount of investment remitted from Taiwan to mainland China at the end of the period			Investment amount approved by the Investment Commission of the Ministry of Economic Affairs			In compliance with the mainland China investment limit set by the Investment Commission of the Ministryof Economic Affairs
$817,430(USD 25,500 thousand)			$894,394(USD 27,500 thousand)			(Note 3)

Note 1: It is calculated based on the original investment cost.

Note 2: As of September 30, 2020, the board of directors’ meeting of Wuxi More Tex Technology Co., Ltd. passed the resolution to issue a cash dividend of NT$10,633 thousand (RMB2,483 thousand), and then repatriate it to the Company through Tex Year Technology Corp.; a total of NT$108,323thousand has already been repatriated.

Note 3: In accordance with the provisions of the letter of the Ministry of Economic Affairs referenced Jing-Shen Zi No. 09704604680, the value is calculated on the basis of 60% of the net value of the Company as of September 30, 2020, except for the Taiwan subsidiary of an enterprise or multinational enterprise approved by the Industrial Development Bureau of the Ministry of Economic Affairs and issued a certificate of compliance with the operation scope of operation headquarters. The Company obtained the certificate of compliance with the operation scope of the operation headquarters (letter referenced Jing-Shou-Gong Zi No. 10820409330) issued by the Industrial Development Bureau of the Ministry of Economic Affairs on April 17, 2019. The period of validity is from April 11, 2019 to April 10, 2022, so it is not subject to the limit.

Note 4: The Company invested NT$50,291 thousand through Tex Year International (SAMOA) Corp., a third-region investment enterprise, and then indirectly invested in Wuxi More Tex Technology Co., Ltd. through Tex Year International (SAMOA) Corp.

Note 5: The Company invested NT$389,798 thousand through Tex Year International (SAMOA) Corp., a third-region investment enterprise, and then indirectly invested in Tex Year Fine Chemical (Guangzhou) Co. through Tex Year International (SAMOA) Corp.

Note 6: Tex Year Fine Chemical (Guangzhou) Co., Ltd. directly invested in Wuxi Tex Year International Trading Co., Ltd. and Shanghai C&M Filtration Solutions Limited for NT$14,265 thousand and NT$80,975 thousand respectively.
Note 7: The Company invested NT$308,108 thousand through Tex Year International (SAMOA) Corp., a third-region investment enterprise, and then indirectly invested in Tex Year Technology (Jiangsu) Co., Ltd. through Tex Year Technology (SAMOA) Corp.
Note 8: As the operation of Deyuan Chemical Technology (Shenzhen) Co., Ltd. was incorporated into Tex Year Fine Chemical (Guangzhou) Co., Ltd. and the liquidation was completed in December 2012; Deyuan Business Machine (Shenzhen) Co., Ltd. completed the liquidation in September 2014.
Note 9: The unrealized net loss of the adjusted lateral transactions recognized in the current period is NT$39 thousand (RMB 9 thousand). The book value of the investment at the end of the period is the balance after deducting the unrealized lateral transactions and downstream transactions at the end of the period.
Note 10: The investment income or loss recognized in the current period is based on the financial statements audited by the accountants.
Note 11: The investment income recognized in the current period is based on the percentage of ownership less the amortization of investment premiums of $2,174 thousand.
Note 12: Tex Year Fine Chemical (Guangzhou) Co., Ltd. directly invests in Shanghai C&M Filtration Solutions Limited and indirectly invests in Jiangsu C&M Filtration Solutions Limited through Shanghai C&M Filtration Solutions Limited
Note 13: The realized net loss of the adjusted lateral transaction recognized in the current period is NT$188 thousand (RMB 44 thousand). The book value of the investment at the end of the period is the balance after deducting the unrealized lateral transactions and downstream transactions at the end of the period.

Note 14: The unrealized net loss of the adjusted lateral transactions recognized in the current period is NT$1,395 thousand (RMB 327 thousand). The book value of the investment at the end of the period is the balance after deducting the unrealized lateral transactions and downstream flow transactions at the end of the period.

Tex Year Industries Inc.

Information of major shareholders December 31, 2020

Table 8

Name of major shareholders	Equity	Equity
	Number of shares held	Shareholding ratio
Chin-Tsung Hsiao Tex Yard Investment Co., Ltd. Der Yuan Development Co., Ltd. Hsiang-Chih Hsiao	15,646,012 6,055,215 5,609,987 4,506,521	17.36% 6.72% 6.22% 5.00%

Note: The major shareholder information in this table is based on the Central Depository’s record of common shares and special shares of the Company (including treasury shares) held by shareholders which reached 5% or more on the last business day at the end of the quarter. There may be a difference between the number of shares recorded in the Company’s consolidated financial statements and the number of shares actually delivered for scrip less registration due to different calculation basis.

§DETAILS OF SIGNIFICANT ACCOUNTING ITEMS§

ITEM SERIAL NO./INDEX Breakdown of assets, liabilities and equity Statement of Cash and Cash Equivalents Schedule 1 Schedule of notes receivable Schedule 2 Schedule of accounts receivable Schedule 3 Schedule of Inventory Schedule 4 Schedule of other current asset Note 16 Financial assets measured at fair value through Schedule 5 other comprehensive income - non-current changes Schedule Schedule of Changes to financial assets Note 8 measured at cost after amortization - non-current Schedule of Changes to investment under the Schedule 6 equity method Schedule of Changes to property, plant and Note 13 equipment Schedule of Changes to right-of-use assets Schedule 7 Schedule of Changes in Accumulated Schedule 8 Depreciation of Right-of-Use Assets Schedule of Changes to intangible assets Note 15 Schedule of other non-current asset Note 16 Schedule of short-term borrowings Schedule 9 Schedule of accounts payable Schedule 10 Schedule of other payable Note 20 Schedule of provision for liabilities - current Note 21 Schedule of other current liabilities Note 19 Schedule of short-term borrowings Schedule 11 Schedule of lease liabilities Schedule 12 Schedule of profit and loss items Schedule of operating income Schedule 13 Schedule of operating costs Schedule 14 Schedule of manufacturing costs Schedule 15 Schedule of operating expenses Schedule 16 Summary of employee benefits, depreciation Schedule 17 and amortization expenses incurred during the year by function

Tex Year Industries Inc.

Statement of Cash and Cash Equivalents

December 31, 2020

Schedule 1 In thousand of New Taiwan Dollars, unless otherwise noted

Item Cash on hand and allowance Bank check deposits Bank demand deposits Total	Abstract Including USD1,000, EUR3,000, Polish $3,000 and JPY861,000 (Note 1) Including USD2,698 thousand, EUR 242 thousand, RMB 5,169 thousand and JPY 8,874 thousand (Note 1)		Amount
			$ 814 51 161,334 $ 162,199

Note 1: Exchange rate USD$1=NTD$ 28.09

EUR$1 = NTD$ 34.56 RMB$1 = NTD$ 4.3160 JPY$1 = NTD$ 0.27250 PLN$1=NTD$ 7.5558

Tex Year Industries Inc.

Schedule of notes receivable

December 31, 2020

Schedule 2

In thousand of New Taiwan Dollars.

Name Non-related party Customer A Customer B Customer C Others (Note)		Amount
		$ 4,739 998 931 11,734 $ 18,402

Note: The balance of each account does not exceed 5% of the balance of this account.

Tex Year Industries Inc.

Schedule of accounts receivable

December 31, 2020

Schedule 3

In thousand of New Taiwan Dollars.

Name Non-related party Customer A Customer B Customer C Others (Note) Subtotal Less: provision for impairment Related party Adhesive Technologies Tex Year Guangzhou Tex Year Europe Tex Year (Hong Kong) Others (Note) Subtotal Less: provision for impairment		Amount
	(	$ 14,493 11,940 8,938 134,434 169,805 16,291) 153,514 29,838 27,514 15,764 12,039 10,769 95,924 - 95,924 $ 249,438

Note: The balance of each account does not exceed 5% of the balance of this account.

Tex Year Industries Inc.

Schedule of Inventory

December 31, 2020

Schedule 4

In thousand of New Taiwan Dollars.

Item Raw materials Materials Semi-finished products Finished products Merchandise inventory Less: Provisions for loss from inventory falling price and dead stock Total		Amount	Amount	Amount
		Cost $ 68,803 3,006 17,910 48,890 20,029 158,638 12,891) $ 145,747	Market price (Note)
	(			$ 69,909 2,999 84,811 68,088 25,553 $ 251,360

Note: The market value of finished goods, merchandise inventory and semi-finished goods is estimated at net realizable value, and the market value of raw materials is estimated at replacement cost.

Tex Year Industries Inc.

Financial assets measured at fair value through other comprehensive income - non-current changes Schedule January 1 to December 31, 2020

Schedule 5 Name Acute Touch Technology Co., Ltd	Beginning Number of shares (1,000 shares) Fair value 1,500$ 3,586	Beginning Number of shares (1,000 shares) Fair value 1,500$ 3,586	Increase duringtheyear Number of shares (1,000 shares) Amount -$ -	Increase duringtheyear Number of shares (1,000 shares) Amount -$ -	Decrease for the	Decrease for the	year(Note) Amount $ 3,586)	End	End	Fair value $ -	In thousand of New Taiwan Dollars, unless otherwise noted. Accumulated impairment Remarks Not applicable No pledge matters.	In thousand of New Taiwan Dollars, unless otherwise noted. Accumulated impairment Remarks Not applicable No pledge matters.
	Number of shares (1,000 shares) 1,500		Number of shares (1,000 shares) -		Number of shares (1,000 shares) -			Number of shares (1,000 shares) 1,500
						(						No pledge matters.

Note: The decrease was due to the recognition of an unrealized loss of $3,586 thousand on investments in equity instruments measured at fair value through other comprehensive income.

Tex Year Industries Inc.

Schedule of Changes to investment under the equity method

January 1 to December 31, 2020

Schedule 6


Schedule 6 Investee Tex Year International (SAMOA) Corp. Tex Year (Hong Kong) Ltd. Tex Year Vietnam Co., Ltd. Tex Year Industrial Adhesives Pvt. Ltd. Tex Year Europe Sp. z o. o.	Beginningbalance Number of shares (1,000 shares) Amount - $ 881,971 8,010 85,897 - 65,311 72 22,496 18 136,056 $ 1,191,731	Increase during the year (Note 1) Number of shares (1,000 shares) Amount - $ 2 - 382 - 482 - - - - $ 866	Decrease during the year (Note 1 and 2) Number of shares (1,000 shares) Amount - ( $ 5,316 ) - - - - - ( 103 ) - ( 204) ($ 5,623)		Foreign operating institute Translation of financial statements Exchange differences $ 4,147 ( 4,611 ) ( 5,820 ) ( 2,347 ) ( 6,328) ($ 14,959)		Investment profit(loss) $ 66,594 1,374 ) 9,217 2,314 7,419 $ 84,170	Endingbalance		Amount $ 947,398 80,294 69,190 22,360 136,943 $ 1,256,185	In thousand of New Taiwan Dollars unless otherwise noted. Net equity Provide guarantee or Pledge situation (Note 3) $ 949,025 None. 80,516 None. 69,847 None. 22,613 None. 137,519 None. $ 1,259,520
	Number of shares (1,000 shares) - 8,010 - 72 18	Number of shares (1,000 shares) - - - - -	Number of shares (1,000 shares) - - - - -					Number of shares (1,000 shares) - 8,010 - 72 18	Sharehol ding ratio(%)
				( ( ( (	( ( ( ( (	(						None. None. None. None. None.

Note 1: The change includes gross profit on sales (unrealized). Note 2: Tex Year International (SAMOA) Co., Ltd. paid cash dividends of $5,316 thousand for the year. Note 3: The net equity in the investees was calculated based on the financial statements of the investees and the Company's percentage of ownership.

Tex Year Industries Inc.

Schedule of Changes to right-of-use assets

2020

Schedule 7 Item Buildings Office equipment Transportation equipment	Beginning balance $ 2,730 1,963 976 $ 5,669	Increase during the year $ - - - $ -	In thousand of New Taiwan Dollars. Decrease for the year Ending balance $ - $ 2,730 - 1,963 - 976 $ - $ 5,669	In thousand of New Taiwan Dollars. Decrease for the year Ending balance $ - $ 2,730 - 1,963 - 976 $ - $ 5,669	In thousand of New Taiwan Dollars. Decrease for the year Ending balance $ - $ 2,730 - 1,963 - 976 $ - $ 5,669
					$ 2,730 1,963 976 $ 5,669

Tex Year Industries Inc.

Schedule of Changes in Accumulated Depreciation of Right-of-Use Assets

2020

Schedule 8 Item Buildings Office equipment Transportation equipment	Beginning balance $ 1,010 1,264 386 $ 2,660	Increase during the year $ 1,010 180 386 $ 1,576	In thousand of New Taiwan Dollars. Decrease for the year Ending balance $ - $ 2,020 - 1,444 - 772 $ - $ 4,236	In thousand of New Taiwan Dollars. Decrease for the year Ending balance $ - $ 2,020 - 1,444 - 772 $ - $ 4,236	In thousand of New Taiwan Dollars. Decrease for the year Ending balance $ - $ 2,020 - 1,444 - 772 $ - $ 4,236
					$ 2,020 1,444 772 $ 4,236

Tex Year Industries Inc.

Schedule of short-term borrowings

December 31, 2020

Schedule 9

In thousand of New Taiwan Dollars, unless otherwise noted.

Debt Bank Hua Nan Bank E.Sun Bank Mega Bank Shin Kong Bank Bank SinoPac Total	Abstract Credit loans Credit loans Credit certificate loans Credit loans Credit loans	BorrowingPeriod 2020/10/29-2021/01/28 2020/10/20-2021/01/18 2020/11/11-2021/05/10 2020/09/22-2021/02/22 2020/12/30-2021/02/26	Annual interest rate(%) 1.00% 0.98% 1.01% 1.00% 1.04%		Amount $ 30,000 90,000 53,000 50,000 70,000 $ 293,000	Mortgage or guarantee
						None. None. None. None. None.

Tex Year Industries Inc.

Schedule of accounts payable December 31, 2020

Schedule 10

In thousand of New Taiwan Dollars.

Factory Non-related party Provider A Others (Note) Subtotal Related party Subsidiary Total		Amount
		$ 21,161 121,293 142,454 17,293 $ 159,747

Note: The balance of each account does not exceed 5% of the balance of this account.

Schedule 11 Debt Bank The Export-Import Bank of the Republic of China Taiwan Cooperative Bank Taiwan Business Bank Taiwan Cooperative Bank Taiwan Business Bank Taiwan Business Bank Taiwan Business Bank (Continue)	Tex Year Industries Inc. Schedule of short-term borrowings December 31, 2020 Term and repayment method Annual interest rate(%) Due within one year The period is from September 29, 2016 to September 28, 2021. From March 2018, every six months is one period, for totally eight periods. The principal and interest are amortized according to the average method. 1.2386% $ 14,250 The period is from December 28, 2017 to December 27, 2022. From January 2019, every one month is one period, for totally 48 periods. The principal and interest are amortized according to the average method. 1.25% 14,353 The period is from December 28, 2017 to December 27, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% 833 The period is from June 28, 2018 to December 27, 2022. From January 2019, every one month is one period, for totally 48 periods. The principal and interest are amortized according to the average method. 1.25% 10,827 The period is from September 14, 2018 to December 28, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% 5,000 The period is from October 8, 2018 to December 28, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% 6,667 The period is from November 6, 2018 to December 28, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% -	Tex Year Industries Inc. Schedule of short-term borrowings December 31, 2020 Term and repayment method Annual interest rate(%) Due within one year The period is from September 29, 2016 to September 28, 2021. From March 2018, every six months is one period, for totally eight periods. The principal and interest are amortized according to the average method. 1.2386% $ 14,250 The period is from December 28, 2017 to December 27, 2022. From January 2019, every one month is one period, for totally 48 periods. The principal and interest are amortized according to the average method. 1.25% 14,353 The period is from December 28, 2017 to December 27, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% 833 The period is from June 28, 2018 to December 27, 2022. From January 2019, every one month is one period, for totally 48 periods. The principal and interest are amortized according to the average method. 1.25% 10,827 The period is from September 14, 2018 to December 28, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% 5,000 The period is from October 8, 2018 to December 28, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% 6,667 The period is from November 6, 2018 to December 28, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% -	Amount	Total $ 14,250 31,908 10,000 18,807 60,000 40,000 40,000	In thousand of New Taiwan Dollars, unless otherwise noted. Mortgage or guarantee Please refer to Note 32 Please refer to Note 32 Please refer to Note 32 Please refer to Note 32 Please refer to Note 32 Please refer to Note 32 Please refer to Note 32
		Due within one year $ 14,250 14,353 833 10,827 5,000 6,667 -	Due after one year $ - 17,555 9,167 7,980 55,000 33,333 40,000

(Continue) Taiwan Business Bank The period is from December 31, 2019 to December 28, 2022. From January 2019, every one month is one period, for totally 144 periods. The principal and interest are amortized according to the average method. 1.25% The Export-Import Bank of the Republic of China The period is from February 26, 2019 to February 25, 2024. From March 2020, every six months is one period, for totally eight periods. The principal and interest are amortized according to the average method. 1.2356% Hua Nan Bank The period is from December 30, 2019 to December 29, 2021. From January 2020, every one month is one period, for totally 24 periods. The interest was paid in each period, and the principal was repaid at one time when due. 1.12% Taiwan Cooperative Bank The period is from March 30, 2020 to March 30, 2025. From January 2020, every one month is one period, for totally 48 periods. The principal and interest are amortized according to the average method. 1.45%	1,500 6,425 40,000 10,996 $ 110,851	16,500 16,063 - 49,004 $ 244,602	18,000 Please refer to Note 32 22,488 None. 40,000 None. 60,000 Please refer to Note 32 $ 355,453

Tex Year Industries Inc.

Schedule of lease liabilities

December 31, 2020

Schedule 12 Item Buildings Transportation equipment Office equipment Less: Lease liabilities due within one year	Abstract	Lease Period 2018.02, 21~ 2021.02. 20	In thousand of New Taiwan Dollars. Discount rate Ending balance 1.55% $ 707 1.55% 207 1.55% 126 1,040 ( 739) $ 301	In thousand of New Taiwan Dollars. Discount rate Ending balance 1.55% $ 707 1.55% 207 1.55% 126 1,040 ( 739) $ 301	In thousand of New Taiwan Dollars. Discount rate Ending balance 1.55% $ 707 1.55% 207 1.55% 126 1,040 ( 739) $ 301
				(	$ 707 207 126 1,040 739) $ 301

Tex Year Industries Inc.

Schedule of operating income January 1 to December 31, 2020

Schedule 13	In thousand of
	New Taiwan Dollars.
Item	Amount
Hot melt adhesives	$ 854,923
Other Glue Products	158,313
Other products	240,214
Total operating income	1,253,450
Less: sales return	( 1,649 )
Less: sales discount	( 725)
Net operating income	$ 1,251,076

In thousand of New Taiwan Dollars.

Tex Year Industries Inc. Schedule of operating costs January 1 to December 31, 2020

Schedule 14

In thousand of New Taiwan Dollars.

Item
Purchase Cost
Product in the beginning
Add: imports for the year
Transfer from raw
materials
Less: End of year goods
Transfer Fees and Others
Subtotal
Product and sales cost
Raw materials at the beginning
of the year
Add: imports for the year
Less: Raw materials at the end
of the year
Transfer Fees and Others
Direct sale of raw materials
Transfer out to commodity
Raw materials consumed
during the year
Direct manual
Manufacturing Costs
Add: Semi-finished products at
the beginning of the year
Transfer from finished
goods
Reduction: Semi-finished
products for sale
Transfer Fees and Others
Semi-finished products at
the end of the year
Manufacturing Cost
Finished products at the
beginning of the year
Add: imports for the year
Others
(Continue)

Amount

$ 18,537
228,062
1,133
(
20,029 )
(
214)

227,489
73,805
556,774
(
71,809 )
(
18,921 )
(
56,378 )
(
1,133)
482,338
36,186
93,451
19,993
1,444
(
6,526 )
(
1,361 )
(
17,910)
607,615
63,309
72,382
406

(Continue)

Item Less: Turn out semi-finished products Transfer Fees and Others Item Finished products at the end of the year Cost of goods sold of finished goods Add: raw materials for sale Semi-finished products for sale Loss from inventory falling price and dead stock Cost of goods sold adjustments Less sharing of manufacturing costs Less: Deprocessing Inventory surplus Subtotal Operating cost	Amount
	( 1,780 ) ( 1,150 ) Amount
	( 48,890) 691,892 56,378 6,526 2,516 ( 5,064 ) $ 15,920 ( 5,516 ) ( 1,240) 761,412 $ 988,901

Tex Year Industries Inc.

Schedule of manufacturing costs January 1 to December 31, 2020

January 1 to December 31, 2020	January 1 to December 31, 2020	January 1 to December 31, 2020
Schedule 15 In thousand of New Taiwan Dollars. Item Amount Depreciation $ 22,208 Salary Expenses 21,961 Utilities, fuel costs 15,095 Processing Fee 7,501 Others (Note) 26,686 Total $ 93,451
		$ 22,208 21,961 15,095 7,501 26,686 $ 93,451

In thousand of New Taiwan Dollars.

Note: The balance of each account does not exceed 5% of the balance of this account.

Tex Year Industries Inc. Schedule of operating expenses January 1 to December 31, 2020

Schedule 16 Item Salary Expenses Shipping Fee Loss of bad debts Import and export expenses Insurance premium Depreciation expenses Research and development expenses Others (Note) Total		Marketing expenses $ 53,823 18,585 7,721 10,378 4,944 1,526 - 27,469 $ 124,446	Administrative expenses $ 44,440 182 - - 4,669 3,661 3,311 18,683 $ 74,946	In thousand of New Taiwan Dollars. Research and development expenses Total $ 33,470 $ 131,733 383 19,150 - 7,721 - 10,378 2,882 12,495 4,165 9,352 30,945 34,256 7,164 53,316 $ 79,009 $ 278,401	In thousand of New Taiwan Dollars. Research and development expenses Total $ 33,470 $ 131,733 383 19,150 - 7,721 - 10,378 2,882 12,495 4,165 9,352 30,945 34,256 7,164 53,316 $ 79,009 $ 278,401	In thousand of New Taiwan Dollars. Research and development expenses Total $ 33,470 $ 131,733 383 19,150 - 7,721 - 10,378 2,882 12,495 4,165 9,352 30,945 34,256 7,164 53,316 $ 79,009 $ 278,401
						$ 131,733 19,150 7,721 10,378 12,495 9,352 34,256 53,316 $ 278,401

Note: The balance of each account does not exceed 5% of the balance of this account.

Tex Year Industries Inc.

Summary of employee benefits, depreciation and amortization expenses incurred during the year by

function

January 1 to December 31, 2020 and 2019

Schedule 17 Employee benefit expenses Salary expense Labor and health insurance expenses Pension Costs Directors' remuneration Others Employee benefit expenses Depreciation expenses Amortization expenses				2020		Total $ 181,034 16,682 10,418 1,757 10,406 $ 220,297 $ 31,560 $ 2,415				In thousand of New Taiwan Dollars. 2019 Business Expenses Total $ 117,623 $ 176,364 10,096 16,462 7,776 10,577 1,442 1,442 5,896 9,365 $ 142,833 $ 214,210 $ 9,560 $ 27,810 $ 2,151 $ 2,151	In thousand of New Taiwan Dollars. 2019 Business Expenses Total $ 117,623 $ 176,364 10,096 16,462 7,776 10,577 1,442 1,442 5,896 9,365 $ 142,833 $ 214,210 $ 9,560 $ 27,810 $ 2,151 $ 2,151
		Business Cost $ 59,221 6,679 2,791 - 3,377 $ 72,068 $ 22,208 $ -		Business Expenses $ 121,813 10,003 7,627 1,757 7,029 $ 148,229 $ 9,352 $ 2,415				Business Cost $ 58,741 6,366 2,801 - 3,469 $ 71,377 $ 18,250 $ -		Business Expenses $ 117,623 10,096 7,776 1,442 5,896 $ 142,833 $ 9,560 $ 2,151

The number of employees for the year and the previous year were 245 and 237, respectively, of which the number of directors who were not also employees was 6 and 7, respectively.
The average employee benefit expense for the year was $925 thousand; the average employee benefit expense for the previous year was $925 thousand.
The average employee salary cost for the current year was $767 thousand; the average employee salary cost for the previous year was $767 thousand.
The average employee salary cost adjustment for the year decreased by 1.30%.
The current year's monitor's honorarium is $621, compared to the previous year's monitor's honorarium of $420.
The Company sets salary standards for its managers and employees with reference to market conditions, the Company's operating conditions and organizational structure, and adjusts them as necessary in light of market salary dynamics, changes in the overall economic and industrial climate, and government regulations, without regard to age, gender, race, religion, political affiliation, or marital status. In order to motivate employees and management team, the Company's Articles of Incorporation stipulate that if there is any remaining balance of the Company's pre-tax income before the distribution of employees' remuneration and directors' and supervisors' remuneration to cover losses, 1% to 10% of the employees' remuneration and no more than 3% of the directors' and supervisors' remuneration should be appropriated. Employee compensation is paid in stock or cash to employees of the subordinate companies who meet the required conditions.

AI assistant

TEX YEAR — Audit Report / Information 2020

52420_rns_2020-11-16_da4a2fc9-6072-4dc8-beff-d2f49fa7ef65.pdf

Tex Year Industries Inc.

Individual Financial Statements and Independent Auditor’s Review Report

INDEPENDENT AUDITOR’S REVIEW REPORT

Audit Opinion

Basis of Audit Opinion

Key Audit Matters

Other Matters

Responsibility of Management and Governance Unit to Individual Financial Statements

Responsibility of Accountants Auditing Individual Financial Statements

Notice to Readers

Tex Year Industries Inc.

Individual Balance Sheet

Tex Year Industries Inc.

Individual Statement of Comprehensive Income

January 1 to December 31, 2020 and 2019

(Continue)

(Continue)

Tex Year Industries Inc.

Individual Cash Flow Statement

January 1 to December 31, 2020 and 2019

(Continue)

(Continue)

Notes to Individual Financial Statements

January 1 to December 31, 2020 and 2019

1. Company History and Business Scope

2. Date and Procedure of Adoption of Financial Statements

3. Application of New and Revised Standards and Interpretations

(2) IFRSs approved by the FSC applicable in 2021

“ Amendment to IFRS 16 Reduction of rent associated with COVID-19"

2. Amendments to IAS 1, “Definition of Accounting Policies”

4. Summary of Significant Accounting Policies

(2) Basis of Preparation

(4) Foreign Currency

(5) Inventory

(6) Invested subsidiaries

1. Single acquisition

2. Derecognition

(11) Financial Instruments

(1) Type of measurements

(2) Impairment on financial assets

(3) Derecognition on financial assets

2. Equity instrument

3. Financial liabilities

(1) Subsequent measurements

(2) Derecognition on financial assets

4. Convertible corporate bonds

(12) Provision for liabilities

(13) Income recognition

1. The Company as lessor

2. The Company as lessee

(15) Borrowing Cost

(16) Government subsidy

(17) Employee benefits

1. Short-term employee benefits

2. Post-employment benefits

(18) Income tax

1. Income tax of the current period

Main Sources of Uncertainty in Estimates and Assumptions

(2) Impairment of inventories

6. Cash and cash equivalents

7. Financial instruments measure at fair value through income statement

8. Financial assets measured at cost after amortization

9. Financial assets measured at fair value through other comprehensive income

Equity instrument investment

10. Notes receivable, accounts receivable and other receivables (including those of

(1) Accounts receivable

December 31, 2019

(2) Collection

(3) Other receivables

11. Inventory

12. Investment under the equity method

(1) Invested subsidiaries

13. Property, plant and equipment

(Continue)

14. Lease agreement

(1) Right-of-use assets

(Continue)

TEX YEAR Audit Report / Information 2020