TONLIN — Audit Report / Information 2022

Nov 10, 2022

Stock No.: 2910

Tonlin Department Store Co., Ltd.

Parent-only Financial Statements and Auditor's Report 2022 and 2021

Address: 10F-6, No. 197, Sec. 4, Zhongxiao E. Rd. Taipei City TEL: (02)2752-2222

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Table of Contents

Item I. Cover II. Table of Contents III. Independent Auditor's Report IV. Standalone Balance Sheet V. Standalone Statement of Comprehensive Income VI. Standalone Statement of Changes in Equity VII. Standalone Cash Flow Statement VIII. Notes to parent-only Financial Statements (I) Organization and operations (II) The Authorization of Financial Statements (III) Application of New and Revised International Financial Reporting Standards (IV) Summary of Significant Accounting Policies (V) Sources of uncertainty to significant accounting judgments, estimates, and assumptions (VI) Summary of Significant Accounting Items (VII) Related party transaction (VIII) Pledged Assets (IX) Significant Contingent Liabilities and Unrecognized Commitments (X) Major Disaster Losses (XI) Significant Subsequent Events (XII) Others (XIII) Additional Disclosures 1.Information about significant transactions 2. Information about investees 3. Information on investments in mainland China 4. Information on main investors (XIV) Segments Information IX. Key Accounting Item Detailed Table	Page 1 2 3～5 6 7～8 9 10～11 12 12 12～13 13～21 21 21～47 48 48 - - - 49～50 49 , 51～56 50 , 57 - 50 , 58 - 59～72	Note No. of Financial Statements
		- - - - - - 1 2 3 4 5 6~25 26 27 - - - 28 29 29 - 29 - -

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Independent Auditor's Report

To stakeholders of Tonlin Department Store Co., Ltd.

Audit opinions

We have audited the accompanying parent-only balance sheet of Tonlin Department Store Co., Ltd.as at December 31, 2022 and 2021, and the parent-only statement of comprehensive income, parent-only statement of changes in shareholders' equity, parent-only cash flow statement, and notes to parent-only financial statements (including summary of significant accounting policies) for the periods from January 1 to December 31, 2022 and 2021.

In our opinion, all material disclosures of the parent-only financial statements mentioned above were prepared in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers, and presented a fair view of the parent-only financial position of Tonlin Department Store Co., Ltd. as at December 31, 2022 and 2021, and parent-only business performance and cash flow for the periods January 1 to December 31, 2022 and 2021.

Basis of audit opinion

We conducted our audits in accordance with Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and the auditing principles. Our responsibilities as an auditor for the parent-only financial statements under the abovementioned standards are explained in the Responsibilities paragraph. All relevant personnel of the accounting firm have followed CPA code of ethics and maintained independence from Tonlin Department Store Co., Ltd. when performing their duties. We believe that the evidence obtained provide an adequate and appropriate basis for our opinion.

Key audit issues

Key audit issues are matters that we considered to be the most important, based on professional judgment, when auditing the 2022 parent-only financial statements of Tonlin Department Store Co., Ltd. These issues have already been addressed when we audited and formed our opinions on the parent-only financial statements. Therefore we do not provide opinions separately for individual issues.

Key audit issues concerning the 2022 standalone financial statements of Tonlin Department Store Co., Ltd. are as follows:

Impairment assessment of investment properties

As at December 31, 2022, Tonlin Department Store Co., Ltd. had investment properties located at Xinzhuang District that were valued at NT$1,059,951 thousand, representing 19% of total assets and constituted a significant part of standalone financial statements. The management follows IAS 36 - “Impairment of Assets” and assesses investment properties for signs of impairment at the end of each reporting period. Assets that exhibit any sign of impairment will have recoverable amount estimated in order to determine the amount of impairment. However, considering that real estate prices are affected by several factors including government policy, economic cycle, and market supply/demand, and that impairment assessment requires subjective judgments, major estimates, and assumptions from the management, we have identified impairment assessment of investment properties as a key audit issue. Accounting policy on impairment assessment of investment properties, uncertainties associated with accounting estimates and assumptions, and related disclosures can be found in Notes 4, 5, and 14 of standalone financial statements.

The following audit procedures were taken in relation to the key audit issues identified above:

1. Understanding and testing the design and implementation of key internal control system that is relevant to impairment assessment of investment properties.

2. Obtaining the independent valuation report used by the management, and evaluating the professional capacity, competence, and objectivity of independent valuers.

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4. Determining the rationality of the valuation method, parameters, and assumptions used in the valuation of investment property and comparing transaction prices of properties in the vicinity.

5. Consulting our own experts about the independent valuer's choice of valuation method as well as inputs and historical market data used in the calculation, and making appropriate comparisons to determine the rationality of the assessed price.

6. Taking count and verifying records of investment properties, and checking title deeds for the lands owned.

Correctness of retail commission income

Tonlin Department Store Co., Ltd. reported retail commission income of NT$113,700 thousand in 2022, representing 25% of operating revenues and was considered significant to the presentation of standalone financial statements. The department store operates by having merchants set up individual retail departments, and the Company earns a certain percentage or amount from each transaction made by merchants. Under this arrangement, the Company first collects payment from customers then deducts merchant's share of the proceeds and recognizes the remainder as sales revenue. Due to the vast number of merchants and the different commission rates involved, calculation of retail commission income depends heavily on the use of computer system, which we consider to be a key audit issue. Disclosures relating to retail commission income can be found in Note 20 of standalone financial statements.

• The following audit procedures were taken in relation to the key audit issues identified above:

• Understanding and randomly testing the effectiveness of internal control design and execution for retail commission income.

• Making sample checks on current year's Merchant Settlement Master Report to determine whether the commission rates configured on the computer system are consistent with contract terms; and making separate calculations using the commission rate to verify the correctness of retail commission income.

Responsibilities of the management and governing body to the standalone financial statements

Responsibilities of the management were to prepare and ensure fair presentation of parent-only financial statements in accordance with "Regulations Governing the Preparation of Financial Reports by Securities Issuers" and to exercise proper internal control practices that are relevant to the preparation of parent-only financial statements so that the parent-only financial statements are free of material misstatements, whether caused by fraud or error.

The management's responsibilities when preparing parent-only financial statements also involved: assessing the ability of Tonlin Department Store Co., Ltd. to operate, disclose information, and account for transactions as a going concern unless the management intends to liquidate Tonlin Department Store Co., Ltd. or cease business operations, or is compelled to do so with no alternative solution.

The governing body of Tonlin Department Store Co., Ltd. (including the Audit Committee) is responsible for supervising the financial reporting process.

Responsibilities of the auditor when auditing parent-only financial statements

The purposes of our audit were to obtain reasonable assurance of whether the standalone financial statements were prone to material misstatements, whether due to fraud or error, and to issue a report of our audit opinions. We considered assurance to be reasonable only if it is highly credible. However, audit tasks conducted in accordance with auditing principles do not necessarily guarantee detection of all material misstatements within the standalone financial statements. Misstatements can arise from fraud or error. Misstatements are considered material if the individual amount or aggregate total is reasonably expected to affect economic decisions of the standalone financial statement user.

When conducting audits in accordance with auditing principles, we exercised professional judgments and raised professional doubts as deemed. We also performed the following tasks as an auditor:

1. Identifying and assessing risks of material misstatement within the standalone financial statements, whether due to fraud or error; designing and executing appropriate response measures for the identified risks; and obtaining adequate and appropriate audit evidence to support audit opinions. Fraud may involve conspiracy, forgery, intentional omission, untruthful declaration, or breach of internal control, and our audit did not find any material misstatement where the risk of fraud is greater than the risk of error.

2. Developing the required level of understanding on relevant internal controls and designing audit procedures that are appropriate under the prevailing circumstances, but without providing opinion on the effectiveness of internal control system of Tonlin Department Store Co., Ltd.

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4. Assessing the appropriateness of accounting policies adopted by the management, and the rationality of accounting estimates and related disclosures made.

5. Forming conclusions regarding the appropriateness of management's decision to account for the business as a going concern, and whether there are doubts or uncertainties about the ability of Tonlin Department Store Co., Ltd. to operate as a going concern, based on the audit evidence obtained. We are bound to remind users of parent-only financial statements and make related disclosures if uncertainties exist in regards to the abovemenetioned events or circumstances, and amend audit opinions when the disclosures are no longer appropriate. Our conclusions are based on the audit evidence obtained up to the date of audit report. However, future events or change of circumstances may still render Tonlin Department Store Co., Ltd. no longer capable of operating as a going concern.

6. Assessing the overall presentation, structure, and contents of the standalone financial statements (including related footnotes), and whether certain transactions and events are presented appropriately in the standalone financial statements.

7. Obtaining sufficient and appropriate audit evidence on financial information of equity-accounted investments held by Tonlin Department Store Co., Ltd., and expressing opinions on parent-only financial statements. Our responsibilities as auditor are to instruct, supervise, and execute audits and form audit opinions on Tonlin Department Store Co., Ltd.

We have communicated with the governing body about the scope, timing, and significant findings (including significant defects identified in the internal control) of our audit.

We have also provided the governing body with a declaration of independence stating that all relevant personnel of the accounting firm have complied with auditors' professional ethics, and communicated with the governing body on all matters that may affect the auditor's independence (including protection measures).

We have identified the key audit matters after communicating with the governing body regarding the 2022 standalone financial statements of Tonlin Department Store Co., Ltd. These issues have been addressed in our audit report except for: 1. Certain topics that are prohibited by law from disclosing to the public; or 2. Under extreme circumstances, topics that we decided not to communicate in the audit report because of higher negative impacts they may cause than the benefits they bring to public interest.

Deloitte Taiwan CPA Chiu, Cheng-Chun CPA Huang Hsiu-Chun Approval reference of the Financial Approval reference of the Securities and Futures Supervisory Commission Bureau Jin-Guan-Zheng-Liu-Zhi No.0930160267 Tai-Tsai-Cheng-(VI)-0920123784

March 7, 2023

Notice to Readers

For the convenience of readers and for information purposes only, the auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. In the event of any discrepancy between the English and the Chinese version or any differences in interpretation between the two versions, the original Chinese version shall prevail. The auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version, and the English version is not audited by certified public accountant.

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Tonlin Department Store Co., Ltd. Standalone Balance Sheet As at December 31, 2022 and 2021

Unit: NTD thousand

Code 1100 1110 1136 1172 1175 1200 130X 1470 11XX 1517 1550 1600 1760 1780 1840 1935 1920 15XX 1XXX Code 2100 2150 2170 2209 2213 2219 2230 2320 2399 21XX 2540 2572 2640 2645 25XX 2XXX 3110 3200 3310 3320 3350 3300 3400 3500 3XXX	ASSET Current assets Cash and cash equivalents (Notes 4 and 6) Financial assets at FVTPL (Notes 4 and 7) Financial assets carried at cost after amortization - current (Notes 4 and 9) Accounts receivable (Notes 4 and 10) Lease receivable (Notes 4 and 10) Other receivables (Notes 4 and 10) Inventory (Notes 4, 5 and 11) Prepayments and other current assets Total current assets Non-current assets Financial assets at FVTOCI - non-current (Notes 4 and 8) Equity-accounted investments (Notes 4 and 12) Property, plant, and equipment (Notes 4, 5, 13 and 27) Investment property, net (Notes 4, 5, 14 and 27) Intangible assets (Notes 4 and 5) Deferred income tax assets (Notes 4 and 22) Long-term lease receivable (Notes 4 and 10) Refundable deposits Total non-current assets Total assets LIABILITIES AND EQUITY Current liabilities Short-term borrowings (Notes 4, 13, 14, 15 and 27) Note payable Accounts payable (Notes 4 and 16) Accrued expenses (Note 17 and 26) Equipment purchase payable (Note 13) Other payables Current income tax liabilities (Notes 4 and 22) Long-term borrowings expiring within a year (Notes 4, 13, 14, 15 and 27) Other current liabilities (Notes 4 and 20) Total current liabilities Non-current liabilities Long-term borrowings (Notes 4, 13, 14, 15 and 27) Deferred income tax liabilities (Notes 4 and 22) Net defined benefit liabilities - non-current (Notes 4 and 18) Guarantee deposits received (Note 20) Total non-current liabilities Total liabilities Equity (Notes 4, 8, 19 and 22) Common share capital Capital reserve Retained earnings Statutory reserves Special reserves Unappropriated earnings Total retained earnings Other equities Treasury stock Total equity Total liabilities and equity		December 31,2022 Amount % $ 105,096 2 373,004 7 - - 7,973 - 3,984 - 4,245 - 10,853 - 23,616 1 528,771 10 17,193 - 750,232 14 2,196,199 40 1,978,998 36 9,357 - 14,252 - 16,898 - 2,924 - 4,986,053 90 $ 5,514,824 100 $ 664,000 12 41,788 1 94,576 2 32,996 1 - - 5,214 - 18,212 - 140,000 2 7,868 - 1,004,654 18 1,844,000 34 216,910 4 11,224 - 50,096 1 2,122,230 39 3,126,884 57 2,087,250 38 540,286 10 487,129 9 462,114 8 129,258 2 1,078,501 19 34,556) ( 1) 1,283,541) ( 23) 2,387,940 43 $ 5,514,824 100	December 31,2022 Amount % $ 105,096 2 373,004 7 - - 7,973 - 3,984 - 4,245 - 10,853 - 23,616 1 528,771 10 17,193 - 750,232 14 2,196,199 40 1,978,998 36 9,357 - 14,252 - 16,898 - 2,924 - 4,986,053 90 $ 5,514,824 100 $ 664,000 12 41,788 1 94,576 2 32,996 1 - - 5,214 - 18,212 - 140,000 2 7,868 - 1,004,654 18 1,844,000 34 216,910 4 11,224 - 50,096 1 2,122,230 39 3,126,884 57 2,087,250 38 540,286 10 487,129 9 462,114 8 129,258 2 1,078,501 19 34,556) ( 1) 1,283,541) ( 23) 2,387,940 43 $ 5,514,824 100		December 31,2021	December 31,2021	December 31,2021
			Amount $ 105,096 373,004 - 7,973 3,984 4,245 10,853 23,616 528,771 17,193 750,232 2,196,199 1,978,998 9,357 14,252 16,898 2,924 4,986,053 $ 5,514,824 $ 664,000 41,788 94,576 32,996 - 5,214 18,212 140,000 7,868 1,004,654 1,844,000 216,910 11,224 50,096 2,122,230 3,126,884 2,087,250 540,286 487,129 462,114 129,258 1,078,501 34,556) 1,283,541) 2,387,940 $ 5,514,824			Amount $ 82,086 410,254 304 6,604 7,054 5,333 41,056 30,285 582,976 22,201 747,064 2,249,393 1,988,201 8,673 22,218 17,586 2,956 5,058,292 $ 5,641,268 $ 530,000 30,557 79,634 33,828 6,700 2,236 998 150,000 8,246 842,199 2,120,000 216,801 14,930 50,365 2,402,096 3,244,295 2,087,250 523,625 474,382 456,282 228,904 1,159,568 89,929) 1,283,541) 2,396,973 $ 5,641,268		%
		( (		( (	( (		( (	1 7 - - - - 1 1 10 1 13 40 35 - 1 - - 90 100 9 1 1 1 - - - 3 - 15 38 4 - 1 43 58 37 9 9 8 4 21 2) 23) 42 100

The accompanying notes are an integral part of the parent-only financial statements.

Chairman: Su Chien-I

President: Weng Hua-Li Vice President: Chen Wen-Lung Head of Accounting: Huang Shu-Tzu

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Tonlin Department Store Co., Ltd. Standalone Statement of Comprehensive Income From January 1 to December 31, 2022 and 2021

Unit: NTD thousands, except EPS which is in 1 NTD

Code 4000 Operating revenues (Notes 4 and 20) 5000 Operating costs (Note 21) 5900 Gross profit 6000 Operating expenses (Notes 4, 18, 21 and 26) 6900 Operating profit Non-operating income and expense 7100 Interest income (Notes 4 and 21) 7010 Other income (Notes 4 and 21) 7020 Other gains and losses (Notes 4, 7, 14 and 21) 7050 Financial costs (Note 21) 7060 Share of gain/loss from subsidiaries and associated companies accounted using the equity method (Notes 4 and 12) 7000 Total non-operating income and expenses 7900 Profit before tax 7950 Income tax expenses (Notes 4 and 22) 8200 Current net income		2022		% 100 21 79 37 42 - 6 9 ) 7 ) 7) 17) 25 4 21		2021
		Amount $ 453,765 94,502 359,263 166,685 192,578 718 24,582 41,428 ) 32,029 ) 30,447) 78,604) 113,974 17,579 96,395				Amount $ 423,003 100,667 322,336 171,719 150,617 30 28,001 9,619 25,598 ) 21,221) 9,169) 141,448 753 140,695		%
	( ( ( (		( ( ( (		( ( (		( ( (	100 24 76 41 35 - 7 2 6 ) 5) 2) 33 - 33

(Continued on next page)

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(Continued)

Code Other comprehensive income 8310 Items not reclassified into profit and loss: 8311 Remeasurement of defined benefit plan (Notes 4 and 18) 8316 Unrealized profit and loss on valuation of equity instruments at FVTOCI (Notes 4, 8 and 19) 8349 Income tax on items not reclassified into profit and loss (Notes 4 and 22) 8300 Other comprehensive income - current 8500 Total comprehensive income - current Earnings per share (Note 23) 9710 Basic 9810 Diluted		2022		% 1 3 ) 2) 4) 17		2021
		Amount $ 3,700 13,666 ) 7,760) 17,726) $ 78,669 $ 0.55 $ 0.55				Amount $ 1,290 17,645 ) 2,698) 19,053) $ 121,642 $ 0.80 $ 0.80		%
	( ( (		( ( (		( ( (		( (	- 4 ) - 4) 29

The accompanying notes are an integral part of the parent-only financial statements.

Chairman: Su Chien-I President: Weng Hua-Li Vice President: Chen Wen-Lung

Head of Accounting: Huang Shu-Tzu

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Tonlin Department Store Co., Ltd. Standalone Statement of Changes in Equity From January 1 to December 31, 2022 and 2021

Unit: NTD thousand

Code A1 Balance as of January 1, 2021 Appropriation and distribution of 2020 earnings B1 Provision for statutory reserves B3 Reversal of special reserves B5 Cash dividends on common shares Total appropriation and distribution of 2020 earnings M1 Adjustment to additional paid-in capital for dividends paid to subsidiaries D1 2021 net income D3 2021 other comprehensive income - after tax D5 2021 total comprehensive income Q1 Disposal of equity instruments at FVTOCI Z1 Balance as of December 31, 2021 Appropriation and distribution of 2021 earnings B1 Provision for statutory reserves B3 Provision for special reserves B5 Cash dividends on common shares Total appropriation and distribution of 2021 earnings M1 Adjustment to additional paid-in capital for dividends paid to subsidiaries D1 2022 net profit D3 2022 other comprehensive income - after tax D5 2022 total comprehensive income Q1 Disposal of equity instruments at FVTOCI Z1 Balance as of December 31, 2022 Chairman: Su Chien-I	C	ommon share capital Capital reserve Retained earnings(Notes 4,8,18 and 19) (Notes 4 and 19) (Note 19) Statutoryreserves Special reserves Unappropriated earnings $ 2,087,250 $ 506,964 $ 470,347 $ 495,507 $ 170,602 - - 4,035 - ( 4,035 ) - - - ( 39,225 ) 39,225 - - - - ( 104,363) - - 4,035 ( 39,225) ( 69,173) - 16,661 - - - - - - - 140,695 - - - - 1,032 - - - - 141,727 - - - - ( 14,252) 2,087,250 523,625 474,382 456,282 228,904 - - 12,747 - ( 12,747 ) - - - 5,832 ( 5,832 ) - - - - ( 104,363) - - 12,747 5,832 ( 122,942) - 16,661 - - - - - - - 96,395 - - - - 2,960 - - - - 99,355 - - - - ( 76,059) $ 2,087,250 $ 540,286 $ 487,129 $ 462,114 $ 129,258 The accompanying notes are an integral part of the parent-only financial statements. President: Weng Hua-Li Vice President: Chen Wen-Lung				Retained earnings(Notes 4,8,18 and 19)		Total $ 1,136,456 - - 104,363) 104,363) - 140,695 1,032 141,727 14,252) 1,159,568 - - 104,363) 104,363) - 96,395 2,960 99,355 76,059) $ 1,078,501	Other items of equity (Notes 4,8 and 19) Unrealized gains/losses on financial assets at FVTOCI ( $ 84,096 ) ( - - - - - - ( 20,085) ( 20,085) 14,252 ( 89,929 ) ( - - - - - - ( 20,686) ( 20,686) 76,059 ($ 34,556) ( Head of Accounting:		Treasury stock (Note 19) $ 1,283,541 ) - - - - - - - - - 1,283,541 ) - - - - - - - - - $ 1,283,541) Huang Shu-Tzu		Total Equity
							( ( ( ( ( (		( ( ( ( ( ( (			( ( ( ( ( (	$ 2,363,033 - - 104,363) 104,363) 16,661 140,695 19,053) 121,642 - 2,396,973 - - 104,363) 104,363) 16,661 96,395 17,726) 78,669 - $ 2,387,940

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Tonlin Department Store Co., Ltd. Standalone Cash Flow Statement

From January 1 to December 31, 2022 and 2021

Unit: NTD thousand

Code Cash flows from operating activities A00010 Pre-tax profit for the current period A20010 Adjustments for: A20100 Depreciation expense A20200 Amortization A20400 Net loss on financial assets at FVTPL A20900 Financial costs A21200 Interest income A21300 Dividend income A22400 Share of loss from subsidiaries and associated companies accounted using the equity method A22500 Loss from disposal of property, plant and equipment A22600 Expenses reclassified from property, plant, and equipment A22700 Loss on disposal of investment properties A30000 Changes in operating assets and liabilities A31115 Financial assets mandatory to be carried at FVTPL A31130 Note receivable A31150 Trade receivable A31180 Other receivables A31200 Inventories A31230 Prepayments and other current assets A31240 Lease receivable A32130 Note payable A32150 Accounts payable A32180 Other payables A32220 Accrued expenses A32230 Other current liabilities A32240 Net defined benefit liabilities A33000 Cash inflow from operating activities A33100 Interest received A33300 Interest paid		2022 $ 113,974 72,758 1,187 35,216 32,029 718 ) 6,413 ) 30,447 9,481 - - 2,034 - 1,369 ) 1,179 30,203 6,669 3,758 11,231 14,942 2,978 2,198 ) 378 ) 6) 357,004 627 30,663 )		2021
	( ( ( ( ( ( (		( ( ( ( ( ( ( ( ( (	$ 141,448 71,830 602 1,530 25,598 30 ) 6,035 ) 21,221 68 269 318 51,660 ) 385 4,065 ) 4,375 37,674 6,403 2,968 ) 14,096 17,025 ) 1,382 ) 969 ) 6,658 3,249) 245,092 78 25,476 )

(Continued on next page)

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(Continued)

Code A33200 Dividends received A33500 Income tax paid AAAA Net cash inflow from operating activities Cash flows from investing activities B00020 Sales of Financial assets at FVTOCI B00030 Acquisition of proceeds from liquidation or capital reduction of financial assets at FVTOCI B00040 Disposal of financial assets measured at cost after amortization B01800 Acquisition of equity-accounted investments B02700 Acquisition of property, plant, and equipment B05400 Acquisition of investment property B07100 Decrease in equipment purchase payable B03700 Decrease (increase) in refundable deposits B04500 Acquisition and purchase of intangible assets B07600 Dividends received from subsidiaries and associated companies BBBB Net cash outflow from investing activities Cash flows from financing activities C00200 Increase (decrease) in short-term borrowings C01600 Proceeds from long-term borrowings C01700 Repayments of long-term borrowings C03000 Increase (decrease) in deposits received C04500 Payment of cash dividends CCCC Net cash outflow from financing activities EEEE Increase in cash and cash equivalents E00100 Opening balance of cash and cash equivalents E00200 Closing balance of cash and cash equivalents		2022 $ 6,413 50) 333,331 4,231 - 304 49,400 ) 20,614 ) 548 ) 6,700 ) 32 551 ) 19,557 53,689) 134,000 5,648,000 5,934,000 ) 269 ) 104,363) 256,632) 23,010 82,086 $ 105,096		2021
	( ( ( ( ( ( ( ( ( ( (		( ( ( ( ( ( ( ( ( (	$ 6,035 22,242) 203,487 321 41,882 27 - 8,973 ) - 74,093 ) 1,780 ) 260 ) 26,680 16,196) 210,000 ) 3,886,000 3,732,000 ) 644 104,363) 159,719) 27,572 54,514 $ 82,086

The accompanying notes are an integral part of the parent-only financial statements.

Chairman: Su Chien-I President: Weng Hua-Li Vice President: Chen Wen-Lung Head of Accounting: Huang Shu-Tzu

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Tonlin Department Store Co., Ltd. Notes to parent-only Financial Statements From January 1 to December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

I. Organization and operations

Tonlin Department Store Co., Ltd. (the "Company") was founded in August 1982 and commenced business operations in November 1984. Taoyuan Branch was later established in September 1995 and commenced operation in November 1995. The Company primarily operates as a retail departmental store. The Company's shares have been listed for trading on Taiwan Stock Exchange Corporation since December 1996. The Company closed down its Taipei Branch on September 20, 1999 out of concern for profit yield, and leased out buildings previously occupied by Taipei Branch for income on October 1. The Company currently has lease contracts established with multiple counterparties including World Fitness Asia Limited (H.K.) Taiwan Branch. Please refer to Note 20 for details. Furthermore, to facilitate the Company's transformation into an integrated entertainment complex, the board of directors passed a resolution to remodel Taoyuan Branch on October 24, 2016, and officially opened for business on October 3, 2018. In addition to retaining top revenue-generating merchants, Taoyuan Branch also brought in restaurant (beverages), sports, leisure, entertainment, and cinema brands to support its new transformation.

	Company's transformation into an integrated entertainment complex, the board of directors passed a resolution to remodel Taoyuan Branch on October 24, 2016, and officially opened for business on October 3, 2018. In addition to retaining top revenue-generating merchants, Taoyuan Branch also brought in restaurant (beverages), sports, leisure, entertainment, and cinema brands to support its new transformation.
II. III. (I) (II)	The parent-only financial statements are presented in NTD, the Company's functional currency. The Authorization of Financial Statements The parent-only financial statements were passed during the board of directors meeting dated March 6, 2023. Application of New and Revised International Financial Reporting Standards Initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC) Adopting the amended version of FSC-approved IFRSs will not result in any material change to the Company's accounting policies. FSC-approved IFRSs applicable in 2023 New,Revised or Amended Standards and Interpretations Effective date of IASB announcement Amendments to IAS 1 regarding "Disclosure of Accounting Policies" January 1, 2023 (Note 1) Amendments to IAS 8 regarding "Definition of Accounting Estimates" January 1, 2023 (Note 2) Amendment to IAS 12 “deferred tax related to assets and liabilities arising from a single transaction” January 1, 2023 (Note 3) Note 1: These amendments will be applied to reporting periods of years starting from January 1, 2023. Note 2: These amendments will be applied to changes in accounting estimates and accounting policies that take place in reporting periods after January 1, 2023. Note 3: Other than being applicable to the deferred tax for all temporary differences related to leases and decommissioning obligations on January 1, 2022, the amendment is applicable to the transactions occurring after January 1, 2022 The Company continues to evaluate that the amendments to the above standards and interpretations do not materially affect its parent-only financial position and business performance as of the publication date of this parent-only financial report.

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

Effective Date Issued by IASB (Note 1)Note 1)) Undetermined

New, Revised or Amended Standards and Interpretations (Note 1)Note 1)) Amendments to IFRS 10 and IAS 28 “Sale or Contribution Undetermined of Assets between an Investor and its Associate or Joint Venture” Amendments to IFRS 16 “Lease Liability in a Sale and January 1, 2024 (Note 2) Leaseback” IFRS 17 “Insurance Contracts” January 1, 2023 Amendments of IFRS 17 January 1, 2023 Amendment to IFRS 17: “Initial Application of IFRS 17 January 1, 2023 and IFRS 9 — Comparative Information” Amendments to IAS 1 “Classification of Liabilities as January 1, 2024 Current or Non-current” Amendments to IAS 1 “Non-current Liabilities with January 1, 2024 Covenants”

Note 1: Unless stated otherwise, the above New IFRSs are effective for annual periods beginning on or after their respective effective dates.

Note 2: The seller as lessee shall retrospectively apply the amendments to IFRS 16 to the lease after sale transactions occur after the date of the initial application of IFRS 16. The Company continues to evaluate how revisions of the above standards and interpretations affect its parent-only financial position and business performance as of the publication date of this financial report. Outcomes of these assessments will be disclosed upon completion.

• IV. Summary of Significant Accounting Policies (I) Statement of compliance

• The parent-only financial statements have been prepared in accordance with

• "Regulations Governing the Preparation of Financial Reports by Securities Issuers."

• (II) Basis of preparation

This parent-only financial statement has been prepared based on historical cost, except for financial instruments carried at fair value and net defined benefit liabilities calculated by deducting fair value of plan assets from present value of defined benefit obligation.

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

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

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

3. Level 3 inputs are unobservable inputs for the asset or liability.

The Company accounts for its subsidiaries and associated companies using the equity method when preparing the parent-only financial statements. To ensure consistency between the amount of profit and loss, other comprehensive income, and equity presented in the parent-only financial statements and the amount of profit and loss, other comprehensive income, and equity attributable to the Company's owners shown in the consolidated financial statements, adjustments were made to differences in accounting treatment between the parent-only basis and consolidated basis for "equity-accounted investments," "share of profit in equity-accounted subsidiaries and associated companies," "share of other comprehensive income in equity-accounted subsidiaries and associated companies," and related equity items.

• (III) Classification of current and non-current assets and liabilities Current assets include:

• 13 -

• Assets that are held mainly for the purpose of trading;

• Assets that are expected to be realized within 12 months after the balance sheet date; and

• Cash and cash equivalents (except for those that are intended to be swapped or settled against debt more than 12 months after the balance sheet date, and those with restricted uses).

• Current liabilities include:

• Liabilities that are held mainly for the purpose of trading;

• Liabilities that are expected to be settled within 12 months after the balance sheet date; and

• Liabilities where the repayment terms can not be extended unconditionally beyond 12 months after the balance sheet date.

Assets and liabilities that do not satisfy the above criteria are classified into non-current assets or non-current liabilities.

The Company's construction activities operate at business cycles that are longer than one year. For this reason, assets and liabilities that arise in relation to construction activities are distinguished between current and non-current portions based on normal business cycle.

• (IV) Foreign currency

During preparation of parent-only financial statements, transactions denominated in currencies other than the functional currency (i.e. foreign currency transactions) are converted and recorded in the functional currency using exchange rate as at the transaction date.

Monetary foreign currency accounts are converted using closing exchange rates as at every balance sheet date. Exchange differences arising from settlement or translation of monetary accounts are recognized in profit and loss in the year occurred.

Foreign currency-denominated non-monetary items carried at fair value are converted using exchange rates as at the date of fair value assessment, with exchange differences recognized in current profit and loss. However, items that have fair value changes recognized in other comprehensive income shall also have exchange differences recognized in other comprehensive income.

Foreign currency-denominated non-monetary items carried at historical cost are converted using exchange rate as at the date of initial transaction. No further re-calculation shall be made.

• (V) Inventories

Proprietary inventory is valued at the lower of cost or net realizable value; the lower of cost or net realizable value is compared by retail departments, except for groups of items within the same category. Net realizable value refers to the balance of estimated selling price less any costs required to sell inventory under normal circumstances; cost is calculated using the retail inventory method.

Construction-in-progress is stated at the lower of cost or net realizable value. Down payments are paid for the purchase of construction land or properties pending sale, and borrowing interests accrued during the construction period are capitalized and recognized as cost of inventory.

Construction land is reclassified into construction-in-progress when construction activities begin. Upon completion, the amount of construction-in-progress is reclassified into operating cost and properties pending sale based on percentages of sold and unsold areas. In joint construction arrangements where the Company contributes land in exchange for units of properties pending sale, no gain/loss is recognized at the time of exchange, and income is recognized only when properties are sold to buyers.

• (VI)

• Subsidiary investments

The Company accounts for subsidiary investments using the equity method. A subsidiary is an entity in which the Company exercises control.

• 14 -

Under the equity method, investments are recognized at cost at initiation; after the acquisition date, book value may be increased or decreased by the Company's share of profits/losses and other comprehensive income in associated companies. Furthermore, change in other equity items of subsidiaries are recognized proportionally at the Company's shareholding percentage.

Changes in ownership of subsidiary without losing control are treated as equity transactions. Difference between book value of investment and the fair value of consideration paid/received is directly recognized as equity. Impairments are assessed for individual cash-generating units and presented consistently throughout the financial statements by comparing recoverable amounts with book values. Should the recoverable amount increase in subsequent years, the amount previously impaired can be reversed and recognized as gains. However, the asset's book value after reversal can not exceed the amount of book value less amortization before the impairment took place.

Any unrealized gains/losses arising from downstream transactions between the Company and subsidiaries have been eliminated in the parent-only financial statements. Gains/losses arising from upstream transactions and transactions among subsidiaries are recognized in the parent-only financial statements only when the Company exercises no control over the subsidiary.

(VII) Investment in associated companies An associated company is an organization in which the Company has significant influence, but does not meet the criteria of a subsidiary.

The Company accounts for associated companies using the equity method. Under the equity method, associated companies are recognized at cost at initiation; after the acquisition date, book value may be increased or decreased by the Company's share of profits/losses and other comprehensive income in associated companies. Furthermore, changes in the equity of associated companies are recognized at the Company's shareholding percentage.

Any excess of the cost of acquisition over the Company’s share of the net fair value of the identifiable assets and liabilities is the premium of real estate properties; such premium is included in the book value of the concerned investment and not to be amortized.

When assessing impairments, the Company treats the entire account as a single asset and tests for impairment by comparing book value with recoverable amount. Any impairment losses recognized are presented as part of the book value of the investment without amortization. Reversal of impairment loss can be recognized up to the sum of subsequent increases in the recoverable amount of the investment.

(VIII) Property, Plant and Equipment Property, plant, and equipment are initially recognized at cost, and subsequently presented at cost after accumulated depreciation and impairment. Property, plant, and equipment in progress are carried at cost less cumulative impairments. Cost includes services expenses and borrowing costs that satisfy the capitalization criteria. These assets are classified into appropriate categories of property, plant, and equipment upon completion and reaching the expected usable state, at which time depreciation will also begin.

No depreciation is provided on land, whereas property, plant, and equipment are depreciated using the straight line method over their useful lives. Depreciation is provided separately for each major component. The Company reviews estimated useful life, residual value, and depreciation method at least once at the end of each year. Impacts of changes in accounting estimates are applied prospectively.

In joint construction arrangements where the Company contributes land in a commercial exchange for units of property classified as property, plant, and equipment, a gain/loss would be recognized at the time of exchange.

Gains or losses arising from decommissioned property, plant, and equipment are calculated as the difference between disposal proceeds and the asset's book value, and are recognized through profit and loss in the year occurred.

• 15 -

• (IX) Investment Property

Investment properties are real estate properties held for rental income or capital gain, or both. Investment properties include land held on hand that the Company has yet to determine their future uses.

Investment properties are initially recognized at cost (including transaction cost) and subsequently presented at cost after accumulated depreciation and impairment. Investment properties are depreciated on a straight-line basis.

Difference between the disposal proceed and book value of decommissioned investment property is recognized in profit and loss.

• (X) Intangible asset

• Acquisition by separate purchase

  • Intangible assets that are acquired through separate purchase with limited useful

  • life are recognized at cost at initiation, and subsequently presented at cost less accumulated amortization and impairment. Intangible assets are amortized on a straight-line basis over their useful lives. The estimated useful life, residual value, and amortization method are reviewed at least once at the end of each year. Impacts of changes in accounting estimates are applied prospectively.

• Decommissioning

Difference between the net disposal proceed and book value of intangible assets removed is recognized in current profit and loss.

• (XI) Impairment of property, plant, equipment, investment properties, and intangible assets The Company evaluates all property, plant, equipment, investment properties, and

• intangible assets for signs of impairment every balance sheet date. Assets that exhibit any sign of impairment will have recoverable amount estimated. If the recoverable amount can not be estimated on an individual basis, the Company will instead estimate recoverable amount for the entire cash-generating unit.

Recoverable amount is the higher between "fair value less selling costs" and the "utilization value." If recoverable amount of an asset or cash-generating unit falls below its book value, the book value of that particular asset/cash-generating unit shall be reduced to the recoverable amount with impairment losses recognized through profit and loss.

When impairment losses are reversed on a later date, the book value of corresponding assets/cash-generating units shall be adjusted upwards to the recoverable amount. However, the increased book value shall not exceed the book value (less amortization or depreciation) of the asset/cash-generating unit before impairment losses were recognized in the first place. Reversal of impairment loss is recognized through profit and loss.

• (XII) Financial instruments Financial assets and financial liabilities are recognized on parent-only balance sheet

• when the Company becomes a party of the contract.

When recognizing financial assets and liabilities at initiation, those that are not designated to be carried at fair value through profit and loss are measured at fair value plus transaction costs that are directly attributable to the acquisition or issuance of financial assets/liabilities. Transaction costs that are directly attributable to the acquisition or issuance of financial assets/liabilities carried at fair value through profit and loss are recognized immediately through profit and loss.

1. Financial asset Routine transactions of financial asset are recognized on or removed from balance

sheet based on principles of trade date accounting.

• (1) Measurement category

Financial assets held by the Company are distinguished into the following categories: financial assets at FVTPL, financial assets carried at cost after amortization, and equity instruments at FVTOCI.

• 16 -

• A. Financial assets at FVTPL

Financial assets at FVTPL mainly comprise financial assets that are mandatory to be measured at fair value with fair value changes recognized through profit and loss. Financial assets that are mandatory to be measured at fair value with fair value changes recognized through profit and loss include: equity instruments that are not specified to be carried at FVTOCI, and debt instruments that do not satisfy the criteria to be carried at cost after amortization or at FVTOCI.

Financial assets at FVTPL are measured at fair value, with dividends and interests recognized as other income. Gains and losses from remeasurement are recognized as other gains and losses. See Note 25 for details regarding the fair value method.

• B. Financial assets carried at cost after amortization

Financial asset investments that satisfy both the following conditions are carried at cost after amortization:

• a. The financial asset is held for a specific business model, and the purpose of which is to hold the financial asset and collect contractual cash flow; and

• b. The contractual terms give rise to cash flows on specific dates, and the cash flows are intended solely to pay principals and interests accruing on outstanding principals.

For financial assets carried at cost after amortization (including cash and cash equivalents, accounts receivable and other receivables carried at cost after amortization etc), the effective interest method is used to determine the book value at initiation. They are subsequently presented net of impairments and amortization. Any gain/loss from currency exchange incurred on these financial assets is recognized through profit and loss. Except for the two circumstances explained below, interest income is calculated by multiplying the book value of financial asset with effective interest rate:

• a. Acquisition or creation of credit-impaired financial assets; in which case interest income is calculated by multiplying the cost of financial assets after amortization with credit-adjusted effective interest rate.

• b. Financial assets that were not credit-impaired at the time of acquisition or origination, but become credit-impaired on a later date; in which case interest income is calculated by multiplying the cost of financial assets after amortization with the effective interest rate starting from the reporting period after credit impairment.

Financial assets are considered credit-impaired if the issuer or debtor exhibits major financial distress, default, likely bankruptcy, financial restructuring, or any financial difficulty that may render the financial asset no longer available on the active market.

Cash equivalents include time deposits with less than 3 months until maturity that are highly liquid, readily convertible into defined amounts of cash, and less prone to the risk of fair value changes. Cash equivalents are held for the purpose of meeting short-term cash commitments.

• C. Equity instruments at FVTOCI

For equity instruments that are neither held for trading nor recognized/received as a consideration for business acquisition, the Company is entitled to an irrevocable option to account them at FVTOCI at initial recognition.

Equity instruments at FVTOCI are measured at fair value; subsequent fair value changes are recognized through other comprehensive income and accumulated under other equity. At the time of disposal, cumulative gains/losses are transferred directly into retained earnings and not reclassified into profit and loss.

• 17 -

Dividends from equity instruments at FVTOCI are recognized in profit and loss when the entitlement to receive is confirmed, unless the dividends clearly represent a partial recovery of the investment cost.

• (2) Impairment of financial assets

On each balance sheet date, the Company assesses impairment losses on financial assets carried at cost after amortization (including accounts receivable) and operating lease receivable based on expected credit losses.

Accounts receivable and operating lease receivable have loss provisions recognized based on expected credit losses over their duration. For other financial assets, the Company first evaluates whether there is significant increase in credit risk since initial recognition. If there is no significant increase in credit risk, loss provisions are recognized based on 12-month expected credit loss; if there is significant increase in credit risk, loss provisions are recognized based on expected credit loss over the remaining duration.

Expected credit losses are determined as average credit loss weighed against the risk of default. 12-month expected credit losses represent the amount of credit losses that the financial instrument is likely to incur due to default event in the next 12 months, whereas expected credit losses for the remaining duration represent the amount of credit losses that the financial instrument is likely to incur due to all possible default events for the remaining duration.

• All impairment losses on financial assets are recognized using allowance

• accounts, which reduce book value of the corresponding financial asset.

• (3) Removal of financial assets

Financial assets can be removed from balance sheet only if all contractual cash flow entitlements have ended, or if the asset has been transferred with virtually all risks and returns assumed by another party.

Difference between the book value of financial asset carried at cost after amortization and the amount of consideration received for the asset's removal is recognized through profit and loss. When an equity instruments at FVTOCI is removed from balance sheet, the amount of cumulative gain/loss is transferred directly into retained earnings and is not reclassified to profit and loss.

1. Equity instrument

Debt and equity instruments issued by the Company are classified into financial liabilities or equity depending on the terms of the underlying contract and the definitions of financial liability and equity used.

Equity instruments issued by the Company are recognized at the amount of proceeds received net of direct issuing costs.

Buyback of the Company's own equity instruments is recognized and deducted under equity. Acquisition, sale, issuance, or retirement of the Company's own equity instruments is not recognized through profit and loss.

1. Financial liability

2. (1) Subsequent measurement All financial liabilities are carried at cost after amortization using the

3. effective interest method.

4. (2) Removal of financial liabilities

When a financial liability is removed, the difference between book value and the consideration paid (including any non-cash assets transferred or any additional liabilities borne) is recognized through profit and loss.

• (XIII) Revenue recognition

The Company first identifies performance obligations in a contract it signs with customer, then divides and allocates the transaction sum to various obligations, and recognizes revenue when each obligation is fulfilled.

• 18 -

Revenue from sale of merchandise

Revenue from sale of merchandise is generated from retail sale of goods in the departmental store, and is recognized as income at the time of customer's purchase. Proceeds collected in advance from the issuance of departmental store vouchers are recognized as contractual liabilities until the vouchers are redeemed by customers. Customer loyalty program represents reward points granted to customers for merchandises sold that customers can spend to purchase merchandise in the future, and are a form of customers' entitlement. At the time of transaction, a percentage of the sales proceeds received or receivable is treated as reward point and recognized as contractual liability; this liability is reclassified into income when reward points are redeemed or voided on a later date.

Sales proceeds of real estate properties sold under normal terms of business are collected in instalments. Contractual liabilities are recognized at the time the proceeds are collected, which are later recognized as income upon completion and delivery of each property to the respective buyer. (XIV) Leases The Company evaluates whether a contract meets the criteria of (or includes arrangements characterized as) lease on the day of contract establishment. Where the Company is the lessor

The Company does not have any lease arrangement that involves a transfer of virtually all risks and returns associated with ownership of the underlying asset to the lessee. All leases are classified as operating lease.

In an operating lease arrangement, the amount of proceeds received net of incentives are recognized as income on a straight-line basis over the lease tenor. Lease negotiation with a lessee is accounted as a new lease from the effective date of lease amendment.

When a lease includes both land and building elements, the Company assesses the classification of each element as the finance or operation lease based on whether substantially all of the risks and rewards incidental to ownership of each element have been transferred to the lessee. The leasing payment is shared between the land and building, based on the relative proportions between the fair values of the land and building’s leasing rights on the date the contract executed. If the leasing payment may be reliably shared between the two elements, each element is treated with the applicable lease classification. If the lease payment cannot be reliably distributed to the two elements, the lease as a whole is the classified as the financing lease; provided that if both elements are obviously qualified for the operation lease criteria, the overall lease is classified as an operation lease. (XV) Borrowing costs Borrowing costs that are directly attributable to the acquisition, construction, or production of qualified assets are treated as part of an asset's cost until virtually all activities needed to bring the asset to its designated usable or salable state have been completed. For specific-purpose loans undertaken for qualified capital spending, any investment income earned on short-term investment of the proceeds before incurring the capital spending is deducted from capitalized borrowing costs.

Except for the above, all other borrowing costs are recognized through profit and loss in the year occurred.

(XVI) Governmental subsidies Governmental subsidies are only recognized when it is reasonably assured that the Company will comply with the conditions attached to the governmental subsidies and receive such subsidies.

The governmental subsidies related to incomes are recognized under other incomes on the systematic basis during the period when the related costs to which the subsidies intend to compensate are recognized as expenses by the Company.

If the governmental subsidies are used to compensate the incurred expenses or losses, or the purpose is providing an immediate financial support to the Company without future related cost, such subsidies are recognized under profit/loss during the period to receive such.

• 19 -

• (XVII) Employee benefits 1. Short-term employee benefits

Liabilities associated with short-term employee benefits are measured at non-discounted amount of cash that the Company expects to pay in exchange for employees' service.

1. Post-employment benefits

For defined contribution plans, the amount of contributions that has to be made to pension funds over the duration of employees' service is recognized as expense. For defined benefit plans, the cost of benefit (including service cost, net interest, and effect of remeasurement) is estimated using the Projected Unit Credit Method. Service costs (including current and previous service costs) and net interests on net defined benefit liabilities (assets) are recognized as employee welfare expense at the time incurred or whenever the plan is amended or curtailed. Effects of remeasurement (including actuarial gains/losses, change in plan asset limits, and return on plan assets net of interest) are recognized under other comprehensive income and added to retained earnings at the time of occurrence. This amount is not reclassified into profit and loss in subsequent periods.

Net defined benefit liabilities (plan assets) represent the shortfall (surplus) of contributions made to the defined benefit plan. Net defined benefit plan assets may not exceed the amount of contributions refundable or the present value of reducible contributions in the future.

• (XVIII) Income tax

The income tax expense represents the sum of the tax currently payable and deferred tax.

1. Tax currently payable

The Company reports current period income (loss) and calculates income tax payable (refundable) according to tax laws stipulated by the local tax jurisdiction. Pursuant to the Income Tax Act of the Republic of China, undistributed earnings are subject to additional income tax, which is recognized in the year shareholders resolve to retain the earning.

Adjustments to income taxes reported in previous years are recognized as income tax expenses in the period the adjustment is made.

1. Deferred tax

Deferred income taxes are tax effects of temporary differences, given rise by the different book value of assets and liabilities presented in the financial statement and those reported for tax filing.

Tax impacts arising from taxable temporary differences are recognized as deferred income tax liabilities; deferred income tax assets are recognized under the condition that the Company is very likely to generate taxable income in the future to offset deductible temporary differences or losses carried forward.

Temporary differences that were not initially recognized as deferred income tax assets are also subject to re-assessment on every balance sheet date. These differences may be recognized to increase the book value of deferred income tax asset if the Company considers it highly likely to generate taxable income for full or partial recovery of such asset in the future. Temporary differences that were not initially recognized as deferred income tax assets are also subject to re-assessment on every balance sheet date. These differences may be recognized to increase the book value of deferred income tax asset if the Company considers it highly likely to generate taxable income for full or partial recovery of such asset in the future.

Deferred income tax assets and liabilities are estimated using expected tax rate applicable at the time the liability/asset is expected to be settled/realized. This expected tax rate is determined based on the tax rate and tax laws prevailing as at the balance sheet date. Deferred income tax liabilities and assets represent tax impacts of the method by which the Company expects to recover/settle the book value of its assets and liabilities as at the balance sheet date.

1. Current and deferred income tax

2. 20 -

Current and deferred income taxes are recognized through profit and loss, except for source accounts that are recognized under other comprehensive income or directly as other equity item, where current and deferred income taxes are also recognized under other comprehensive income or directly as equity.

V.

Sources of uncertainty to significant accounting judgments, estimates, and assumptions

When applying accounting policies, the management is required to make judgments, estimates, and assumptions based on historical experience or other relevant factors in situations where information cannot be easily obtained from available sources. The actual outcome may differ from initial estimates.

The Company incorporates the development of COVID-19 pandemic in Taiwan, and its potential impact on the economic environment, as the considerations for the related material accounting estimates, including estimation of cash flow, growth rate, discount rate, and profitability. The management will continue to review the estimates and basic assumptions. If a revision of accounting estimate affects only the current period, the effect shall be recognized only for the current period. If a revision of accounting estimate affects current and future periods, the effect shall also be recognized for current and future periods. Sources of uncertainty to estimates and assumptions

Impairment of property, plant, equipment, investment properties, and intangible assets

When assessing asset impairment, the Company relies on the use of subjective judgment and determines the level of independent cash flow, useful life, and future

income/expenses/losses for specific asset groups after taking into consideration the method in which assets are used and industry characteristics. Any change of economic circumstances and any change in estimate caused by the Company's strategies may result in significant impairment in the future.

VI. Cash and cash equivalents

impairment in the future. Cash and cash equivalents
Petty cash and cash on hand Check and demand (current) deposit Cash equivalents Time deposits with an original tenor of 3 months or less.	December 31,2022 $ 220 60,328 44,548 $ 105,096	December 31,2021
			$ 220 73,562 8,304 $ 82,086

Range of interest rates applicable to bank deposits as at the balance sheet date is shown below:

	below:
VII.	Demand deposits Financial assets at FVTPL-Current Financial assets designated as at FVTPL Non-derivative financial assets - TWSE, TPEX, and Emerging Stock Market shares - Fund beneficiary certificates - Corporate bonds - Bonds	December 31,2022 0.20%~1.70% December 31,2022 $ 154,215 167,583 46,682 4,524 $ 373,004	December 31,2021
			0.01%~0.80% December 31,2021
				$ 129,384 244,918 30,819 5,133 $ 410,254

Please refer to Note 21 for gains/losses on financial assets at FVTPL.

• 21 -

VIII. Financial assets at FVTOCI

Financial assets at FVTOCI
Non-current Domestic investments Emerging Stock Market shares Unlisted shares Foreign investments Unlisted shares Total	December 31,2022 $ 4,563 - 12,630 $ 17,193	December 31,2021
			$ 4,563 5,008 12,630 $ 22,201

The Group invests in the above instruments by adopting a medium-long term strategy, and expects to profit over the long term. Management of the Group is of the opinion that recognizing short-term fair value changes through profit and loss on such investments does not conform with the long-term investment plans described above, and therefore has chosen to account such investments at FVTOCI.

The investees, WK 7 Innovation Co., Ltd., WK 8 Innovation Co., Ltd., WK Innovation Co., Ltd., and WK 5 Innovation Co., Ltd, all conducted capital decreases in cash in March 2021, and refund the share payments. The Group recovered total NT$41,882 thousand per shareholdings. In addition, in May 2022, total of NT$4,231 thousand was settled and refunded as the settled share payment. The related other equity - unrealized valuation loss from financial assets at FVOCI of NT$79,378 thousand was transferred to the retained earnings.

In June 2021, the Group adjusted the investment positions to diversify risks. Thus the all the common shares of Fortune Technology Fund II Ltd. were sold as the fair value for NT$321 thousand. The related other equity - unrealized valuation loss of the financial assets at fair value through other comprehensive income, NT$14,252 thousand, was transferred to the retained earnings.

The Group recognized NT$2,000 thousand of unrealized loss on valuation of equity instruments at FVTOCI in 2021 (2022: none)

	instruments at FVTOCI in 2021 (2022: none)
IX.	Financial assets carried at cost after amortization-current December 31,2022 Domestic investments Time deposit with initial maturity of more than 3 months $ -	December 31,2021 $ 304
	Domestic investments Time deposit with initial maturity of more than 3 months
			$ 304

As at December 31, 2021, time deposits with initial tenors of 3 months or longer accrued interests at 3.20% (2022: none).

• 22 -

X. Accounts receivable and other receivables

Accounts receivable and other receivables
Arising from business activities Trade receivable Operating lease receivable - Current - Non-current Subtotal Other receivables Amount receivable from sale of securities Utility and management fees receivable Interests receivable Others Subtotal Total	December 31,2022 $ 7,973 3,984 16,898 20,882 1,557 1,096 109 1,483 4,245 $ 33,100	December 31,2021
			$ 6,604 7,054 17,586 24,640 - 1,168 18 4,147 5,333 $ 36,577

(I) Trade receivable Accounts receivable primarily represent retail sales collectible from consumers on transactions paid with credit cards and third-party payment tools. The majority of accounts receivable are credit card balances to be collected from financial institutions. Credit term on sale of merchandise is generally 30 days, and most proceeds are collected within this duration.

The Company recognizes loss provisions on accounts receivable based on expected credit losses over the duration of the receivable account. Expected credit loss over the remaining duration takes into account customers' past payment records. Since previous credit loss records showed no significant difference in loss pattern across customer groups, the Company simply set the expected credit loss rate based on number of days overdue. If there is evidence to suggest that the counterparty is undergoing severe financial crisis and the recoverable amount can not be reasonably estimated, the Company will directly offset loss provisions against accounts receivable. In which case, the Company will continue collection efforts on the receivables, and any amounts recovered will be recognized through profit and loss.

Age of account receivables is analyzed as below:

Not overdue	December 31,2022 $ 7,973	December 31,2021	December 31,2021
			$ 6,604

The Company found no sign of impairment in accounts and notes receivable as at December 31, 2022 and 2021.

(II) Operating lease receivable

Operating lease receivable represents lease incentives granted on operating leases. The total cost of incentives is amortized on a straight-line basis and allocated over the remaining lease tenor as deductions to rental income. Lease negotiations had taken place with some lessees in the current year due to COVID-19. The negotiations were accounted as new leases from the effective date of lease amendment.

For concentration of credit risks in lease receivables, please refer to Note 25.

• 23 -

XI.

Inventories Proprietary inventory - Cosmetics and women's undergarments Properties pending sale - Jiaoxi Gongyuan Section, Yilan	December 31,2022 $ 2,329 8,524 $ 10,853	December 31,2021	December 31,2021
			$ 3,169 37,887 $ 41,056

Amount of cost of goods sold recognized from inventory totaled NT$33,983 thousand in 2022 and NT$48,701 thousand in 2021. No inventory devaluation loss was provided in 2022 and 2021.

The Company's property pending sale forms part of the joint construction agreement entered into between the Company and subsidiary - De Hong Development in March 2015. Under this agreement, the Company contributed land while De Hong Development contributed capital and technology to complete and share units of the construction project. The project was completed in October 2017 and all ownership transfer has been completed to date. XII. Equity-accounted investments

Equity-accounted investments
Subsidiary investments Investments in Associates Subsidiary investments Non-listed company De Hong Development Co., Ltd. SONG YUAN INVESTMENT CO., LTD. SHUN TAI INVESTMENT CO., LTD. GUAN CHAN INVESTMENT CO., LTD. JIA FONG INVESTMENT CO., LTD.	December 31,2022 $ 566,297 183,935 $ 750,232 December 31,2022 $ 382,899 81,024 44,008 29,393 28,973 $ 566,297	December 31,2021
		$ 600,597 146,467 $ 747,064 December 31,2021
			$ 419,245 82,066 41,917 28,951 28,418 $ 600,597

(I) Subsidiary investments

Investee De Hong Development Co., Ltd. SONG YUAN INVESTMENT CO., LTD. SHUN TAI INVESTMENT CO., LTD. GUAN CHAN INVESTMENT CO., LTD. JIA FONG INVESTMENT CO., LTD.	Percentage of ownership/votingright	Percentage of ownership/votingright
	December 31,2022 100% 100% 100% 100% 100%	December 31,2021
		100% 100% 100% 100% 100%

De Hong Development Co., Ltd., resolved by its board of directors on August 25, 2021, conducted a capital decrease to offset the deficit, with 15,000,000 issued shares cancelled.

• 24 -

After the capital decrease, the paid-in capital is NT$450,000 thousand, divided into 45,000,000 shares.

Share of profit and loss and other comprehensive income from equity-accounted subsidiaries in 2022 and 2021 were calculated based on audited financial statements of the respective subsidiaries for the corresponding periods.

(II)

Investments in Associates

December 31, 2022 December 31, 2021 Associated companies with significant influence Chung Hsiao Enterprise Co., Ltd. $ 183,935 $ 146,467 Percentage of share ownership/voting rightsge of share ownership/voting rightse of share ownership/voting rightsp/voting rightsvoting rightsg rights rightsghtshts December 31, 2022, 2022 2022 December 31, 2021, 2021 2021 Chung Hsiao Enterprise Co., Ltd. 26.89% 20%

Percentage of share ownership/voting rightsge of share ownership/voting rightse of share ownership/voting rightsp/voting rightsvoting rightsg rights rightsghtshts December 31, 2022, 2022 2022 December 31, 2021, 2021 2021 26.89% 20%

On November 4, 2022, the Company purchased 1,300,000 shares of Chung Hsiao Industrial Co. Ltd. with NT$49,400 thousand from New Leader Asia Enterprise Ltd. upon the Board’ resolution, and 6.89% of stake was acquired. The delivery was completed on November 7, 2022.

Nature of business activities, main places of business, and countries of registration for the above associated companies are disclosed in Appendix 2 - "Information of Investees." Summary financial information of associated companies under the Company is presented below:

presented below:
Current asset Non-current assets Current liabilities Non-current liabilities Equity Shareholding percentage of the Company Company's share of equity Adjustment to fair value of non-current assets due to acquisition of shares Book value of investment Current operating revenues Current net income Other comprehensive income - current Share of current net income Share of other comprehensive income - current Dividends received from Chung Hsiao Enterprise Co., Ltd.	December 31,2022 $ 202,928 222,008 ( 20,794 ) ( 60,234) $ 343,908 26.89% $ 92,477 91,458 $ 183,935 2022 $ 25,630 $ 20,822 ($ 58,924) $ 4,113 ($ 12,889) $ 3,156	December 31,2021
	( (	( (	$ 262,235 222,414 26,622 ) 60,234) $ 397,793 20% $ 79,558 66,909 $ 146,467 2021
	( (	( (	$ 21,737 $ 17,542 $ 77,961) $ 3,508 $ 15,592) $ 3,776

• 25 -

Share of profit/loss and other comprehensive income from equity-accounted associated companies in 2022 and 2021 were recognized based on audited financial statements of the respective associated companies for the corresponding periods.

XIII. Property, Plant and Equipment

Property, Plant and Equipment
Book value for each category Land Buildings, net Computer and communication equipment, net Transport equipment, net Other equipment, net Construction in progress	December 31,2022 $ 859,925 1,322,276 9,347 817 3,834 - $ 2,196,199	December 31,2021
			$ 858,029 1,373,230 10,684 955 5,175 1,320 $ 2,249,393

Cost Land Buildings Computer and communication equipment Transport equipment Other equipment Construction in progress Accumulated depreciation Buildings Computer and communication equipment Transport equipment Other equipment Total					2022
		Opening balance $ 858,029 1,904,695 17,587 4,906 11,145 1,320 2,797,682 531,465 6,903 3,951 5,970 548,289 $ 2,249,393		Increase in currentyear $ 175 4,072 22 - - 16,345 $ 20,614 $ 62,204 1,291 138 1,310 $ 64,943	Disposal in currentyear $ - ( 28,147 ) ( 406 ) - ( 185 ) - ($ 28,738) ( $ 18,765 ) ( 338 ) - ( 154) ($ 19,257)		Other adjustments $ 1,721 16,921 - - - 17,665) $ 977 $ 361 - - - $ 361	Closingbalance
						(			$ 859,925 1,897,541 17,203 4,906 10,960 - 2,790,535 575,265 7,856 4,089 7,126 594,336 $ 2,196,199

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Cost Land Buildings Computer and communication equipment Transport equipment Other equipment Construction in progress Accumulated depreciation Buildings Computer and communication equipment Transport equipment Other equipment Total					2021
		Opening balance $ 853,457 1,911,058 17,458 4,906 11,164 3,236 2,801,279 477,820 5,815 3,537 4,330 491,502 $ 2,309,777		Increase in currentyear $ - - 378 - 140 8,455 $ 8,973 $ 61,043 1,295 414 1,773 $ 64,525	Disposal in currentyear $ - ( 7,894 ) ( 249 ) - ( 159 ) - ($ 8,302) ( $ 7,894 ) ( 207 ) - ( 133) ($ 8,234)			Closingbalance
									$ 858,029 1,904,695 17,587 4,906 11,145 1,320 2,797,682 531,465 6,903 3,951 5,970 548,289 $ 2,249,393

As per assessment, the Company's property, plant, and equipment showed no sign of impairment as at December 31, 2022 and 2021.

Property, plant, and equipment of the Company were depreciated on a straight-line basis over the number of useful years shown below:

Buildings 4 to 55 years Computer and communication equipment 5 to 19 years Transport equipment 5 years Other equipment 5 to 19 years

For disclosure on the amount of property, plant and equipment pledged as collaterals, please refer to Note 27.

XIV. Investment Property

please refer to Note 27. Investment Property
Investment Property Xinzhuang District, New Taipei City Da'an District, Taipei City	December 31,2022 $ 1,059,951 919,047 $ 1,978,998	December 31,2021
			$ 1,059,951 928,250 $ 1,988,201

• 27 -

Cost Land Buildings Accumulated depreciation Buildings Total Cost Land Buildings Accumulated depreciation Buildings Total						2022
		Opening balance $ 1,859,117 296,388 2,155,505 167,304 $ 1,988,201		Increase in currentyear		Decrease in currentyear $ - - $ - $ - 2021	Other adjustments ( $ 1,720 ) ( 577) ($ 2,297) ($ 361)	Closingbalance
				$ - 548 $ 548 $ 7,815					$ 1,857,397 296,359 2,153,756 174,758 $ 1,978,998
		Opening balance $ 1,863,689 292,409 2,156,098 163,122 $ 1,992,976		Increase in currentyear	( ( (	Decrease in currentyear $ - 2,945) $ 2,945) $ 2,627)	Other adjustments ( $ 4,572 ) 6,924 $ 2,352 ($ 496)	Closingbalance
				$ - - $ - $ 7,305					$ 1,859,117 296,388 2,155,505 167,304 $ 1,988,201

Investment properties - buildings are depreciated on a straight-line basis over the number of useful years shown below:

Buildings 10 to 55 years

The Company owned several investment properties located at Qiongtai Section, Fuying Section, and Jianguo Section, Xinzhuang District, New Taipei City. The fair values were determined by independent valuers using the comparative approach and the land development analysis approach as at the respective balance sheet dates. Discount rate was one of the significant unobservable inputs used during valuation, and the rate was determined at 2.45% and 1.17% as at December 31, 2022 and 2021, respectively.

The Company also owned several investment properties located at Renai Section, Da'an District, Taipei City. Fair values were determined at NT$7,154,379 thousand and NT$6,712,135 thousand as at December 31, 2022 and 2021 respectively. These fair values were not established by an independent valuer; instead, valuation was performed by the management using valuation model that was commonly accepted among market participants. This valuation had proceeded using market evidence similar to real estate transaction prices.

All of the Company's investment properties are proprietary owned. For disclosure on the amount of investment property pledged as collaterals, please refer to Note 27.

XV. Borrowings

• (I) Short-term borrowings

rrowings Short-term borrowings
Secured borrowings Bank borrowings	December 31,2022 $ 664,000	December 31,2021
			$ 530,000

Working capital bank borrowings bore interest rates of 1.395%~1.410% and 0.88% as at December 31, 2022 and 2021, respectively.

For disclosure on the amount of property, plant, equipment, and investment property pledged as collaterals for short-term borrowings, please refer to Note 27.

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(II) Long-term borrowings	December 31,2022	December 31,2021

Secured borrowings Bank SinoPac Credit line: NT$1,400,000 thousand. Contract tenor: November 24, 2021 to November 30, 2023. A new contract starting from November 10, 2022 and ending on November 30, 2024 was signed on November 10, 2022. $ 1,000,000 $ 1,050,000 Bank of Taiwan Credit line: NT$600,000 thousand. Contract tenor: June 24, 2020 to June 24, 2023. A new contract starting from July 19, 2022 and ending on July 19, 2025 was signed on July 19, 2022. 444,000 600,000 Hua Nan Bank The credit limit was NT$293,000 thousand, and the contract term was from December 31, 2019 to January 12, 2022; additionally, a new contract was entered on September 3, 2021 with the credit limit of NT$493,000 thousand, which might be shared with the short-term secured borrowing; the contract term was from September 3, 2021 to September 3, 2022. Extended to September 23, 2023 on September 23, 2022. Within the borrowing limit, term of each drawdown is three years. $ 190,000 $ 290,000 Taishin Bank Credit line: NT$278,000 thousand. Contract tenor: September 30, 2021 to - September 30, 2024. 50,000

(Continued on next page)

• 29 -

(Continued)

December 31,2022 First Commercial Bank Credit line: NT$350,000 thousand. Contract tenor: October 5, 2021 to October 5, 2023. A new contract starting from October 3, 2022 and ending on October 3, 2024 was signed on October 3, 2022. 350,000 1,984,000 Less: parts that listed as due within in a year 140,000 Long-term borrowings $ 1,844,000 Effective interest rate range for long-term borrowings: December 31,2022 Effective interest rate: Floating interest rate borrowing 1.580%~1.630% Fixed interest rate borrowing 1.400%~1.750%	December 31,2021
	280,000 2,270,000 150,000 $ 2,120,000 December 31,2021
	0.800%~1.050% 0.875%~0.890%

For disclosure on the amount of property, plant, equipment, and investment property pledged as collaterals for secured long-term borrowings, please refer to Note 27.

XVI. Accounts payable

XVI.	Accounts payable
XVII.	December 31,2022 Accounts payable Arising from business activities $ 94,576 The average credit term for trade purchases is 30 days. Accrued expenses December 31,2022 Salary and bonus payable $ 11,572 Tax payable 8,497 Utility expenses payable 4,512 Interest payable 1,982 Others 6,433 $ 32,996	December 31,2021
		$ 79,634 December 31,2021
			$ 14,281 8,466 4,668 616 5,797 $ 33,828

XVIII. Post-employment benefit plans (I) Defined contribution plans

The pension scheme introduced under the "Labor Pension Act" that the Company is subjected to is a government-managed defined contribution plan, for which each participating entity is required to contribute an amount equal to 6% of employees' monthly salary into their individual pension accounts held with the Bureau of Labor Insurance.

• 30 -

(II) defined benefit plan

The Company is also subject to the pension scheme introduced under the "Labor Standards Act," which is a government-managed defined benefit plan. Under this plan, employees' pension benefits are calculated based on their years of service and gross salary for the month of retirement (excluding allowances and festive bonuses). The Company makes monthly pension contributions equivalent to 2% of employees' monthly salaries into an account held under Bank of Taiwan in the Labor Pension Supervisory Committee's name. In the event that the account is estimated to be short of balance to pay workers who are expected to meet their retirement criteria in the following year, the Company will reimburse the shortfall in one contribution by no later than the end of March next year. The account is managed by Bureau of Labor Funds, Ministry of Labor. The Company has no influence whatsoever over the investment strategy.

The following amounts relating to the defined benefit plan have been recognized on the parent-only balance sheet:

parent-only balance sheet:
Present value of defined benefit obligations Fair value of plan assets Net defined benefit liabilities	December 31,2022 $ 37,822 ( 26,598) $ 11,224	December 31,2021
	(	(	$ 40,883 25,953) $ 14,930

Changes in net defined benefit liability:

January 1, 2022 Servicing costs Service costs for the current period Interest expense (income) Recognized in profit or loss Remeasurement Return on plan assets (excluding amounts already included in net interest) Actuarial (gains) loss - Change in financial assumption - Experience adjustment Recognized in other comprehensive income Employer's contribution Plan asset payments December 31, 2022 January 1, 2021 Servicing costs Service costs for the current period Interest expense (income) Recognized in profit or loss Remeasurement	Present value of defined benefit obligations $ 40,883 394 255 649 - ( 1,622 ) ( 10) ( 1,632) - ( 2,078) $ 37,822 $ 43,545 393 163 556	Fair value of plan assets ($ 25,953) - ( 163) ( 163) ( 2,068 ) - - ( 2,068) ( 492) 2,078 ($ 26,598) ($ 24,076) - ( 91) ( 91)	Net defined benefit liabilities	Net defined benefit liabilities
	( ( ( (	( ( ( ( ( ( ( ( ( (	( ( ( ( (	$ 14,930 394 92 486 2,068 ) 1,622 ) 10) 3,700) 492) - $ 11,224 $ 19,469 393 72 465

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Present value of defined benefit obligations Fair value of plan assets Net defined benefit liabilities Return on plan assets (excluding amounts already included in net interest) - ( 328 ) ( 328 ) Actuarial (gains) loss - Change in demographic assumption 654 - 654 - Change in financial assumption ( 747 ) - ( 747 ) - Experience adjustment ( 869) - ( 869) Recognized in other comprehensive income ( 962) ( 328) ( 1,290) Employer's contribution - ( 3,714) ( 3,714) Plan asset payments ( 2,256) 2,256 - December 31, 2021 $ 40,883 ($ 25,953) $ 14,930 Amounts of defined benefit plan recognized through profit and loss, by function: 2022 2021 Administrative expenses $ 486 $ 465	Present value of defined benefit obligations Fair value of plan assets Net defined benefit liabilities Return on plan assets (excluding amounts already included in net interest) - ( 328 ) ( 328 ) Actuarial (gains) loss - Change in demographic assumption 654 - 654 - Change in financial assumption ( 747 ) - ( 747 ) - Experience adjustment ( 869) - ( 869) Recognized in other comprehensive income ( 962) ( 328) ( 1,290) Employer's contribution - ( 3,714) ( 3,714) Plan asset payments ( 2,256) 2,256 - December 31, 2021 $ 40,883 ($ 25,953) $ 14,930 Amounts of defined benefit plan recognized through profit and loss, by function: 2022 2021 Administrative expenses $ 486 $ 465	Net defined benefit liabilities
		$ 465

The Company is exposed to the following risks due to adoption of pension scheme introduced under the "Labor Standards Act":

1. Investment risks: The Bureau of Labor Funds, Ministry of Labor, manages the labor pension fund either on its own or through mandate. The labor pension fund is being allocated into equity securities, debt securities, and bank deposits local and abroad; however, the Company estimates return on plan assets at a rate no less than the 2-year time deposit rate offered by local banks.

2. Interest rate risk: A decrease in government bond yield would increase the present value of defined benefit obligations while at the same time increase return of plan assets invested in debt instruments. The overall effect on net defined benefit obligation is partially offset.

3. Salary risk: The present value of defined benefit obligations is calculated by taking into consideration the participants' future salary levels. An increase in salary level would raise the present value of defined benefit obligations.

The present value of defined benefit obligations is determined based on actuarial estimates made by certified actuaries. Below are the main assumptions used on the date of measurement:

measurement:
Discount rate Expected salary increase	December 31,2022 1.250% 2.000%	December 31,2021
		0.625% 2.000%

• 32 -

A reasonable change in the main actuarial assumption would increase (decrease) the present value of defined benefit obligations by the following amounts, provided that all other assumptions remain unchanged:

other assumptions remain unchanged:
Discount rate 0.25% increase 0.25% decrease Expected salary increase 0.25% increase 0.25% decrease	December 31,2022 ($ 620) $ 636 $ 621 ($ 608)	December 31,2021
	( (	( (	$ 733) $ 755 $ 732 $ 714)

Actuarial assumptions tend to be intercorrelated. It is unlikely to see only one assumption changing at one time, therefore the above sensitivity analysis may not truly reflect changes in the present value of defined benefit obligation.

Expected contributions in the next year Average maturity of defined benefit obligations uity Common share capital Authorized and issued shares (thousand shares) Authorized and paid-in capital	December 31,2022 $ 309 6.6 years December 31,2022 208,725 $ 2,087,250	December 31,2021	December 31,2021
		$ 360 7.2 years December 31,2021
			208,725 $ 2,087,250

XIX. Equity

(I) Common share capital

All issued common shares have a face value of NT$10 per share. Each share is entitled to one voting right and the right to receive dividends. (II) Capital reserve

Capital reserve
Shares premium from issuance Treasury stock transaction	December 31,2022 $ 71,028 469,258 $ 540,286	December 31,2021
			$ 71,028 452,597 $ 523,625

This additional paid-in capital can be offset against losses, or distributed in cash or capitalized into share capital when the Company has no cumulative losses outstanding. However, capitalization of this additional paid-in capital is capped at a certain percentage of the Company's paid-in share capital each year.

(III) Retained earnings and dividends policy

According to the earnings appropriation policy stipulated in the Articles of Incorporation, annual surpluses concluded by the Company are first subject to taxation and reimbursement of previous losses, followed by a 10% provision for statutory reserves and provision or reversal of special reserves as the laws may require. Any surpluses remaining will be added to unappropriated earnings accumulated from previous years, for which the board of directors will propose an earnings appropriation plan and seek resolution in a shareholder meeting before distribution. Refer to Note 21-(8) - Employee and director remuneration for the Company's employee and director remuneration policy outlined in the Articles of Incorporation.

• 33 -

The Company passed a resolution during the shareholder meeting dated June 28, 2019 to amend its Articles of Incorporation. In addition to the terms described in the preceding paragraph, any cash distribution of dividend, profit, statutory reserve, or additional paid-in capital, whether in whole or in part, must be resolved in a board meeting with more than two-thirds of the board present, voted in favor by more than half of attending directors, and reported in the upcoming shareholder meeting.

The Company’s shareholders’ meeting resolved to amend the Articles of Incorporation on August 31, 2021. As a conventional department store, the Company experiences no major change in sales volume but foresees moderate growth. After taken into consideration its long-term development plans and goals of maximizing shareholders' interest, the Company has adopted a dividend policy that makes consistent payouts primarily in cash. The shareholders’ dividends are not lower than 10% of the distributable earnings of the year; of which, cash dividends shall not account for less than 50% of the sum of cash dividends plus stock dividends. However, the Company may forgo dividend payment if distributable earnings amount to NT$0.2 or less in a given year.

Other than aforesaid, the shareholders’ meeting also specified that as required by laws, the Company shall make provision for special earnings reserve from unappropriated earnings carried from previous years for any net contra-equity balances accumulated under other contra-equity items in previous years before distributing earnings. If the Company is unable to make adequate provision from unappropriated earnings carried from previous years, the Company shall treat current net income and non-net income items as unappropriated earnings and make provisions accordingly.

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

The following are details of the 2021 and 2020 earnings appropriation resolved during annual general meetings held on June 14, 2022 and August 31, 2021:

Provision for statutory reserves Provision (reversal) of special reserves Cash dividends Cash dividends per share (NT$)		2021 $ 12,747 $ 5,832 $ 104,363 $ 0.5		2020
			(	$ 4,035 $ 39,225) $ 104,363 $ 0.5

The aforesaid cash dividends have been resolved for the distribution in the board meetings on March 14, 2022 and March 22, 2021, respectively. To respond to the “Measures Related to Postponing Shareholders’ Meeting of Public Companies to Cope with the Pandemic,” announced by FSC, the Company cancelled the originally scheduled shareholders’ meeting, and convened the meeting on August 31, 2021.

Details of the 2022 earnings appropriation plan proposed by the board of directors in meeting dated March 6, 2023 are as follows:

meeting dated March 6, 2023 are as follows:
Provision for statutory reserves Provision for special reserves	Appropriation of Earnings
		$ 2,330 $ 126,929

Distribution of 2022 earnings is still pending for shareholders' resolution in the annual general meeting scheduled on June 19, 2023.

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(IV) Special reserves

The Company reclassified NT$372,185 thousand of unrealized gain on revaluation into retained earnings when adopting IFRSs for the first time, and made provisions for special reserves of the same amount in accordance with the authority's instruction No. Jin-Guan-Zheng-Fa-1010012865 in 2013. This special reserve may be reversed when the underlying property is disposed or reclassified on a later date.

When appropriating 2021 and 2020 earnings, the Company made reversal and provision for special reserves totaling NT$5,832 thousand and NT$39,225 thousand, respectively, for differences in the market price and book value of parent company shares held by subsidiaries, after taking into consideration the prevailing shareholding percentage. (V) Other items of equity

Unrealized gain/(loss) on financial assets at FVTOCI

(VI)	Opening balance Incurred in the current year Unrealized loss/profit - equity instrument (Note 8) Share of equity-accounted associated companies Cumulative gains/losses transfer to retained earnings following disposal of equity instrument Closing balance Treasury stock Reason for buyback Shareholding at the beginning of year 2022 Subsidiaries' holding of the Company's shares reclassified from investment into treasury stock 33,322 2021 Subsidiaries' holding of the Company's shares reclassified from investment into treasury stock 33,322			2022	( ( ( ( Unit: Decrease in currentyear	( ( ( ( Unit: Decrease in currentyear		2021 $ 84,096 ) 4,493 ) 15,592 ) 14,252 $ 89,929) Thousand Shares Shareholding at the end of year 33,322 33,322
			( ( ( (	$ 89,929 ) 7,797 ) 12,889 ) 76,059 $ 34,556) Increase in currentyear - -
						- -

• 35 -

Information relating to subsidiaries' holding of the Company's shares as at balance sheet date:

No. of shares

date:	No. of shares
Investee December 31, 2022 GUAN CHAN INVESTMENT CO., LTD. JIA FONG INVESTMENT CO., LTD. SONG YUAN INVESTMENT CO., LTD. SHUN TAI INVESTMENT CO., LTD. December 31, 2021 GUAN CHAN INVESTMENT CO., LTD. JIA FONG INVESTMENT CO., LTD. SONG YUAN INVESTMENT CO., LTD. SHUN TAI INVESTMENT CO., LTD.	held (thousand shares) 8,750 8,767 7,366 8,439 8,750 8,767 7,366 8,439	Acquisition cost $ 337,066 337,787 283,545 325,143 $ 1,283,541 $ 337,066 337,787 283,545 325,143 $ 1,283,541	Market price and book value
				$ 264,688 265,202 222,821 255,280 $ 1,007,991 $ 350,000 350,680 294,640 337,560 $ 1,332,880

Subsidiaries' holding of the Company's shares are treated as treasury stocks; subsidiaries are not entitled to participate in cash issue or vote, but are otherwise entitled to the same rights as ordinary shareholders.

XX. Revenues

• (I) Breakdown of operating revenues

2022 Net sales revenues $ 118,589 Lease incomes 263,491 Construction incomes 34,652 Other operating revenues 37,033 $ 453,765 Explanation and breakdown of income from customers' contracts 2022 Net sales revenues Revenues from sale of merchandise $ 4,889 Retail commission income 113,700 $ 118,589 Construction incomes Income from sale of property $ 34,652		2021
		$ 115,954 237,912 32,568 36,569 $ 423,003 2021
		$ 16,003 99,951 $ 115,954 $ 32,568

• (II) Explanation and breakdown of income from customers' contracts

(Continued on next page)

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(Continued)

2022 Other operating revenues Merchants' subsidy for department renovation Revenue $ 2,941 Management fee income 29,511 Others 4,581 $ 37,033 Analysis of retail commission income: 2022 Total department sales $ 1,008,254 Retail commission income $ 113,700 (III) Contract balance December 31,2022 Contract liability $ 6,243			2021
			$ 1,326 28,590 6,653 $ 36,569 2021
	$ 829,926 $ 99,951 December 31,2021
			$ 6,391

The change in contractual liabilities was mainly attributed to the discrepancy between the time obligation was fulfilled and the time payment was made to customers. (IV) Lease incomes

Lease incomes
Lease incomes Investment Property Share of mall rental income		2022 $ 224,084 39,407 $ 263,491		2021
				$ 199,449 38,463 $ 237,912

Operating lease arrangements involve leasing of investment properties and retail malls (presented as property, plant, and equipment) owned by the Company, for tenors of 1-7 years and 1-13 years, respectively. The lessees are not entitled to any privileges to purchase the leased properties at the end of the lease tenor.

As at December 31, 2022 and 2021, the Company had collected deposits totaling NT$50,096 thousand and NT$50,365 thousand, respectively, in relation to the operating lease agreements.

Some of the Company's real estate leasing agreements contain contingent rent clauses that require the lessee to pay contingent rent at a certain percentage of monthly sales revenues.

XXI. Profit before tax

Pre-tax profit includes the following items: (I) Breakdown of operating costs

Breakdown of operating costs
Cost of sales Cost of leasing Construction cost Other operating costs		2022 $ 3,975 36,930 30,008 23,589 $ 94,502		2021
				$ 13,406 36,357 35,295 15,609 $ 100,667

• 37 -

(II) Interest income

(II) Interest income
Cash in banks (III) Other income Carpark income Dividend income Incomes from governmental subsidies Others		2022 $ 718 2022 $ 9,962 6,413 - 8,207 $ 24,582		2021
				$ 30 2021
				$ 7,630 6,035 9,813 4,523 $ 28,001

The governmental subsidies are the subsidies to the business having difficulties due to impacts of COVID-19 in service sectors, provided by MOEA, and the compensation of the re-zoning urban land announced by New Taipei City Government. In 2021, the total amount received was NT$9,813 thousand.

(IV) Other gains or losses

received was NT$9,813 thousand. Other gains or losses
Loss from disposal of property, plant and equipment Loss on disposal of investment properties Net foreign exchange gains Gain (loss) on financial assets mandatory to be carried at FVTPL Others		2022 $ 9,481 ) - 1,216 33,152 ) 11) $ 41,428)		2021
	( ( ( (		( ( (	$ 68 ) 318 ) 304 10,047 346) $ 9,619

Net gain/loss on financial assets mandatory to be carried at FVTPL includes: (A) Loss on fair value changes totaling NT$35,216 thousand in 2022 and NT$1,530 thousand in 2021; and (B) Gain on disposal totaling NT$2,064 thousand in 2022 and NT$11,577 thousand in 2021.

(V)

Financial costs

2021. Financial costs
Interest on bank loans		2022 $ 32,029		2021
				$ 25,598

There was no capitalization of interest in 2022 and 2021.

• 38 -

(VI) Depreciation and amortization

(VI) Depreciation and amortization
Property, Plant and Equipment Investment Property Intangible asset Total An analysis of depreciation by function Operating costs Operating expenses An analysis of amortization by function Cost of sales Operating expenses (VII) Employee benefits expense Retirement benefits (Note 18) Defined contribution plans Defined benefit plan Subtotal Other employee benefits Total An analysis by function Operating expenses		2022 $ 64,943 7,815 1,187 $ 73,945 $ 17,387 55,371 $ 72,758 $ 149 1,038 $ 1,187 2022 $ 1,762 486 2,248 57,981 $ 60,229 $ 60,229		2021
				$ 64,525 7,305 602 $ 72,432 $ 16,140 55,690 $ 71,830 $ 148 454 $ 602 2021
				$ 1,824 465 2,289 62,640 $ 64,929 $ 64,929

(VIII) Employee and director remuneration

The Company provides for employee remuneration at 0.1%-4%, and director remuneration at no more than 4%, of current year's pre-tax profit (before employee and director remuneration). 2022 and 2021 estimated employee/director remuneration were resolved in board of directors meetings dated March 6, 2023 and March 14, 2022, respectively. Details are as follows:

Ratio

respectively. Details are as follows: Ratio
2022 Remuneration to employees 0.13% Remuneration to directors - Amount 2022 Cash Stocks Remuneration to employees $ 154 $ - Remuneration to directors - -	2022		2021
			0.10% - 2021
		Cash		Stocks $ - -
		$ 150 -

• 39 -

The amount actually paid of the employee’ and directors’ remunerations resolved by the board of directors on March 14, 2022 are different form the recognized amount in the annual parent-only financial statements. The difference is adjusted as the profit/loss in 2022.

The distribution amount resolved b the board of directors The amount recognized in the annual financial reports	2021
	Remuneration to employees $ 150 1,000	Remuneration to directors
		$ - 1,000

The actual amounts of 2020 employee remuneration and director remuneration paid were indifferent from the amounts recognized in the 2020 financial statements.

Please visit "Market Observation Post System" for more information regarding employee/director remuneration resolved during the Company's board of director meetings.

(IX) Gains (losses) on foreign currency exchange

Foreign exchange gains Total loss on currency exchange Net profit		2022 $ 6,339 5,123) $ 1,216		2021
	(		(	$ 449 145) $ 304

XXII. Income tax

(I) Income tax recognized in profit or loss

Major components of tax expense were as follows:

Tax currently payable Incurred in the current year Levied on unappropriated earnings Prior years adjustment Deferred tax Incurred in the current year Income tax expense recognized in profit or loss		2022 $ 18,036 227 999) 17,264 315 $ 17,579		2021
	(		(	$ 998 - 974 1,972 1,219) $ 753

• 40 -

Reconciliation of accounting income and income tax expense:

	Reconciliation of accounting income and income tax expense:
(II) (III) (IV)	2022 Profit before tax $ 113,974 Income tax derived by applying the statutory tax rate to pre-tax net profit $ 22,795 Loss on valuation of financial assets 7,043 Tax-exempt income ( 11,288 ) Levied on unappropriated earnings 227 Previous income taxes adjusted in the current year ( 999 ) Difference to paid for the basic tax amount - Recognized deficit offset with the capital decrease of the subsidiary - (Used) unrecognized losses carried forward ( 199) Income tax expense recognized in profit or loss $ 17,579 Income tax recognized in other comprehensive income 2022 Deferred tax Incurred in the current year - Remeasurement of defined benefit plan ( $ 740 ) - Equity instruments at FVTOCI ( 7,020) ($ 7,760) Unused losses carried forward not recognized as deferred income tax sheet December 31,2022 Loss carried forward Expiring 2027 $ - Expiring in 2031 958 $ 958 Current tax liabilities December 31,2022 Income tax payable $ 18,212		2021
		( (	$ 141,448 $ 28,290 306 773 ) - 974 998 30,000 ) 958 $ 753 2021
		( $ 258 ) ( 2,440) ($ 2,698) asset in the balance December 31,2021
		$ 199 958 $ 1,157 December 31,2021
			$ 998

• 41 -

(V) Deferred income tax assets and liabilities Below are changes in deferred income tax assets and liabilities: 2022

2022
Deferred tax assets Temporary difference Impairment loss of financial assets at FVTOCI Defined benefit plan Others Deferred tax liabilities Temporary difference Provision for land increment value tax Adjustment for rent-free period 2021 Deferred tax assets Temporary difference Impairment loss of financial assets at FVTOCI Defined benefit plan Others Deferred tax liabilities Temporary difference Provision for land increment value tax Adjustment for rent-free period		Opening balance $ 13,034 9,003 181 $ 22,218 $ 213,961 2,840 $ 216,801 Opening balance $ 15,474 9,261 39 $ 24,774 $ 213,961 3,917 $ 217,878	Recognized in profit or loss $ - - ( 206) ($ 206) $ - 109 $ 109 Recognized in profit or loss $ - - 142 $ 142 $ - ( 1,077) ($ 1,077)	Recognized in other comprehensive income ( $ 7,020 ) ( 740 ) - ($ 7,760) $ - - $ - Recognized in other comprehensive income ( $ 2,440 ) ( 258 ) - ($ 2,698) $ - - $ -		Closing balance
					(	$ 6,014 8,263 25) $ 14,252 $ 213,961 2,949 $ 216,910 Closing balance
			( (	( ( (		$ 13,034 9,003 181 $ 22,218 $ 213,961 2,840 $ 216,801

(V) Income tax assessments The Company's profit-seeking business income tax filings have been certified by the tax authority up until 2020.

• 42 -

XXIII. EPS

EPS
Basic earnings per share Diluted earnings per share		2022 $ 0.55 $ 0.55		Unit: share/NT$ 2021 $ 0.80 $ 0.80

The net income and weighted average number of ordinary shares outstanding in calculating earnings per share were as follows: Current net income

Current net income
Current net income Number of shares Weighted average number of ordinary shares in computation of basic earnings per share Effect of potentially dilutive ordinary shares: Remuneration to employees Weighted average number of ordinary shares used in the computation of diluted earnings per share		2022 $ 96,395 2022 175,403 6 175,409		2021 $ 140,695 Thousand Shares 2021 175,403 32 175,435
			Unit:

If the Company has the option to distribute employee remuneration either in cash or in shares, then the calculation of diluted earnings per share shall be made by assuming full share-based payment. In which case, the number of potential common shares is added to the calculation of weighted-average outstanding shares as soon as they become dilutive, and this is the basis used for calculating diluted earnings per share. Such a dilutive effect of the potential shares is included in the computation of diluted earnings per share until the shareholders resolve the number of shares to be distributed to employees at their meeting in the following year.

XXIV. Capital risk management

The Company exercises capital management to ensure business continuity throughout the group. This capital management aims to maintain an optimal balance of debt and equity that maximizes shareholder returns. The Company has maintained its overall strategies unchanged in past years.

The Company's capital structure comprises net debt (i.e. borrowings less cash and cash equivalents) and equity (i.e. sum of share capital, additional paid-in capital, retained earnings, and other equity items).

The Company is not required to obey any other capital rules outside the organization. The management reviews the Company's capital structure on a regular basis to address the costs and risks associated with various types of capital. Depending on the recommendations of its management, the Company may balance its capital structure by paying dividends, raising new debts, or by repaying existing debts.

XXV. Financial instruments

• (I) Fair value information - financial instruments that are not measured at fair value

In the management's opinion, all financial assets and liabilities that are not measured at fair value have been presented on the parent-only balance sheet at book values that resemble their fair values.

• 43 -

• (II) Fair value information - financial instruments with fair value measured on a recurring basis 1. Degree of fair value measurements December 31, 2022

December 31, 2022
Financial assets at FVTPL Domestic listed shares - Equity investments Foreign public listed (OTC-traded) shares - Bond investments Fund beneficiary certificates Total Financial assets at FVTOCI Investment in equity instruments - Emerging Stock Market shares - Foreign unlisted shares Total December 31, 2021 Financial assets at FVTPL Domestic listed shares - Equity investments Foreign public listed (OTC-traded) shares - Bond investments Fund beneficiary certificates Total Financial assets at FVTOCI Investment in equity instruments - Emerging Stock Market shares - Domestic unlisted shares - Foreign unlisted shares Total		Level 1		Level 2 $ - - - $ - $ - - $ - Level 2 $ - - - $ - $ - - - $ -		Level 3 Total $ - $ 154,215 - 51,206 - 167,583 $ - $ 373,004 $ 4,563 $ 4,563 12,630 12,630 $ 17,193 $ 17,193 Level 3 Total $ - $ 129,384 - 35,952 - 244,918 $ - $ 410,254 $ 4,563 $ 4,563 5,008 5,008 12,630 12,630 $ 22,201 $ 22,201	Total
		$ 154,215 51,206 167,583 $ 373,004 $ - - $ - Level 1					$ 154,215 51,206 167,583 $ 373,004 $ 4,563 12,630 $ 17,193 Total
		$ 129,384 35,952 244,918 $ 410,254 $ - - - $ -

There was no change of fair value input between level 1 and level 2 in 2022 and 2021.

1. Reconciliation of Level 3 fair value measurements of financial instruments Financial assets that involve the use of level 3 fair value inputs were equity

instruments at FVTOCI. Reconciliation of 2022 and 2021 balances is explained below:

Opening balance Recognized as other comprehensive income (unrealized loss on valuation of financial assets at FVTOCI) Refund from capital reduction Disposal Closing balance		2022 $ 22,201 777 ) - 4,231) $ 17,193		2021
	( (		( ( (	$ 66,457 2,000 ) 41,882 ) 374) $ 22,201

• 44 -

• Level 3 fair value measurement technique and assumption Fair value of domestic and foreign unlisted shares is determined based on

investees' latest net worth after taking liquidity into consideration. Liquidity discount is used as a significant unobservable input; a lower liquidity discount would increase fair value of such investment.

• (III) Categories of financial instruments

December 31, 2022 December 31, 2021 Financial asset At FVTPL Financial assets designated as at FVTPL $ 373,004 $ 410,254 Financial assets at amortized cost (Note 1) 120,238 97,283 Financial assets at FVTOCI - Investment in equity instruments 17,193 22,201 Financial liability Financial liabilities carried at amortized cost (Note 2) 2,852,601 2,980,573

Note 1: The balance includes cash, cash equivalents, accounts receivable, other receivables , time deposits with initial maturity of more than 3 months, and refundable deposits, and other financial assets carried at cost after amortization.

• Note 2: The balance includes short-term borrowing notes payable, accounts payable, accrued expenses (excluding tax payable and salary & bonus payable), equipment purchase payable, other payables, long-term borrowings due within one year, refundable deposits, long-term borrowings, and other financial liabilities carried at cost after amortization.

(IV) Financial risk management objective and policies Main financial instruments used by the Company include equity and debt instruments, fund beneficiary certificates, accounts receivable, accounts payable, and loans. The Company's Financial Management Department is responsible for supporting business units, making coordinated use of capital, and performing treasury transactions in local and international financial markets. It monitors and manages financial risks within the Company by preparing internal reports, which analyze the scope and severity of risk exposures. These risks include market risk (including currency risk, interest rate risk, and other price risks), credit risk, and liquidity risk.

1. Market risk

2. (1) Exchange rate risk

See Note 28 for information on financial assets denominated in non-functional currencies as at the balance sheet date. No sensitivity analysis was provided as the effect of exchange rate variation was insignificant. (2) Interest rate risk

The Company is exposed to interest rate risks due to capital borrowed at both fixed and floating rates.

The book value of financial assets and financial liabilities susceptible to interest rate risks as at the balance sheet date is presented below:

Fair value interest rate risk -Financial assets -Financial liabilities Cash flow interest rate risk -Financial assets -Financial liabilities	December 31,2022 $ 44,548 2,108,000 59,725 540,000	December 31,2021
		$ 8,608 1,460,000 73,425 1,340,000

• 45 -

Bank deposits and loans that the Company has placed/borrowed at fixed rate are susceptible to interest rate risk in the form of fair value change. However, the management considers the impact of interest rate variation to be insignificant given the short borrowing tenor and low borrowing rate. Demand deposits and loans that the Company has placed/borrowed at floating rate are susceptible to interest rate risk in the form of cash flow changes.

Sensitivity analysis

The following sensitivity analysis has been prepared to explain interest rate risk exposure of floating-rate financial assets and bank loans as at the balance sheet date. Calculations were made on financial assets and liabilities that were susceptible to interest rate risk in the form of cash flow changes as at the balance sheet date. Interest rate sensitivity analyses are reported to the management by applying a variance of 0.25% above and below. This variance conforms with the management's expectation about the possible and reasonable range of interest rate variation.

A 0.25% increase/decrease in interest rate would have reduced/increased the Company's 2022 and 2021 pre-tax profit by NT$1,201 thousand and NT$3,166 thousand, respectively, if all other variables remained unchanged. This variation is largely attributed to exposure of bank loans undertaken at floating rate.

There was no significant change in the Company's interest rate sensitivity from the previous year.

(3) Other price risk

The Company is exposed to the risk of equity price variation due to investment in domestic and foreign listed equity securities. The Company does not engage in active trading of such investment. Equity price risk of the Company is mainly concentrated in equity instruments issued within the Greater China Region.

Sensitivity analysis

The following sensitivity analysis was conducted based on equity price risks as at the balance sheet date.

If equity prices increased/decreased by 10%, pre-tax profit for 2022 and 2021 would have increased/decreased by NT$15,422 thousand and NT$12,938 thousand, respectively, due to a rise/fall in the fair value of financial assets at FVTPL. Meanwhile, pre-tax other comprehensive income for 2022 and 2021 would have increased/decreased by NT$1,719 thousand and NT$2,220 thousand, respectively, due to a rise/fall in the fair value of financial assets at FVTOCI.

• 46 -

• Credit risk

Credit risk refers to the risk of financial loss due to counterparties’ failure in fulfilling contractual obligations. As at the balance sheet date, the Company's maximum exposure to the risk of loss due to counterparties' default on contractual obligations is represented by the book value of financial assets shown on the parent-only balance sheet.

Lease proceeds receivable by the Company were concentrated in three main customers, which accounted for 93% and 95% of the balance as at December 31, 2022 and 2021, respectively. However, the Company expects no significant credit risk as it has collected appropriate amounts of deposit.

Furthermore, due to the fact that the consolidated entity places liquid capital with banks of high credit rating issued by reputable international rating agencies, there should be limited level of credit risk exposure.

1. Liquidity risk

The Company maintains adequate position of cash and cash equivalents as well as bank credit lines to support corporate operations and to mitigate effects of cash flow variation. The management monitors use of bank limits and makes sure that borrowing terms are duly complied.

Maturity analysis for contracted non-derivative financial liabilities was prepared based on the earliest possible repayment dates, using undiscounted cash flows (including principal and estimated interest). Cash flows include interest and principal payments.

The following table shows the earliest times that the Company may be demanded to make immediate repayment of bank loans, without considering the likelihood of such demands. Maturity analysis of other non-derivative financial liabilities is prepared based on the agreed repayment date.

Undiscounted amounts of floating interest cash flow are estimated using yield curve as at the balance sheet date. December 31, 2022

curve as at the balance December 31, 2022	sheet date.
Non-derivative financial liabilities Non-interest bearing liabilities Floating rate instruments Fixed rate instruments December 31, 2021 Non-derivative financial liabilities Non-interest bearing liabilities Floating rate instruments Fixed rate instruments	Repayable upon demand or within 1 month $ 174,572 - 234,000 $ 408,572 Repayable upon demand or within 1 month $ 152,954 150,000 84,000 $ 386,954		1 to 3 months $ - - 430,000 $ 430,000 1 to 3 months $ - - 446,000 $ 446,000		3 months to 1 year $ - 140,000 - $ 140,000 3 months to 1 year $ - - - $ -		1 to 5years
							$ - 400,000 1,444,000 $ 1,844,000 1 to 5years
							$ - 1,190,000 930,000 $ 2,120,000

Bank borrowing constitutes a main source of liquidity for the Company. As at December 31, 2022 and 2021, the Company had undrawn bank limits of NT$1,593,000 thousand and NT$1,441,000 thousand, respectively.

• 47 -

XXVI. Related party transaction

In addition to disclosures made in other footnotes, the Company had the following transactions with related parties.

• (I) Related party name and category

Related Party Name Relationship with the Company GUAN CHAN INVESTMENT CO., LTD. The Company's subsidiary (GUAN CHAN INVESTMENT) JIA FONG INVESTMENT CO., LTD. (JIA The Company's subsidiary FONG INVESTMENT) SONG YUAN INVESTMENT CO., LTD. The Company's subsidiary (SONG YUAN INVESTMENT) SHUN TAI INVESTMENT CO., LTD. The Company's subsidiary (SHUN TAI INVESTMENT) De Hong Development Co., Ltd. (De Hong The Company's subsidiary Development) Chung Hsiao Enterprise Co., Ltd. (Chung Associated company of the Company Hsiao Enterprise)

Associated company of the Company

• (II) Other related party transactions

• Associated company - Chung Hsiao Enterprise passed resolutions to distribute cash dividends for 2021 and 2020 in board of directors meetings held in March 2022 and March 2021, which the Company received a sum of NT$3,157 thousand and NT$3,776 thousand, respectively, at the prevailing shareholding percentage.

• Subsidiaries GUAN CHAN INVESTMENT, JIA FONG INVESTMENT, SONG YUAN INVESTMENT, and SHUN TAI INVESTMENT passed resolutions in board of directors meetings held in March 2022 and 2021 to distribute cash dividends for 2021 and 2020 totaling NT$16,401 thousand and NT$22,904 thousand, respectively.

• In January 2015, the Company signed a property leasing agreement with De Hong Development to lease out part of the Company's office premise for use by the counterparty at monthly rent of NT$50 thousand. The Company has also been cooperating with De Hong Development on the sale of property inventory; in 2022 and 2021, the advertising expenses were accounted for NT$650 thousand and NT$602 thousand, respectively; as at December 31, 2022 and 2021, the Company had NT$167 thousand and NT$309 thousand of outstanding advertising expenses, respectively, that were payable to De Hong Development.

• (III) Compensation of key management personnel

• The Company had paid the following compensations to its directors and the executive

• management:

management:
Short-term employee benefits Post-employment benefits		2022 $ 13,544 169 $ 13,713		2021
				$ 13,136 164 $ 13,300

Compensation to directors and members of the executive management is determined by the Remuneration Committee based on individual performance and market trends. XXVII. Pledged Assets

The Company has placed part of its property, plant, equipment, and investment property as collaterals to secure bank borrowings. Below is a summary of assets pledged as collaterals:

Property, Plant and Equipment - Land - Buildings Investment Property	December 31,2022 $ 841,989 739,801 885,409 $ 2,467,199	December 31,2021	December 31,2021
			$ 840,092 768,365 892,273 $ 2,500,730

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XXVIII. Foreign currency-denominated financial assets of material impact

The following is a summarized presentation of foreign currencies used by the Company other than the functional currency. The exchange rates disclosed are the rates at which the respective foreign currency is converted into the functional currency. Foreign currency assets of material effect:

December 31, 2022

Financial asset Monetary items USD CNY ZAR Non-monetary items USD CNY ZAR December 31, 2021 Financial asset Monetary items USD CNY ZAR Non-monetary items USD CNY ZAR	Foreign currency $ 1,476 258 124 2,078 718 1,321 Foreign currency $ 381 488 1,076 2,290 616 544	Exchange rate 30.710 4.408 1.811 30.710 4.408 1.811 Exchange rate 27.680 4.344 1.733 27.680 4.344 1.733	Carryingamount	Carryingamount
			$ 45,340 1,136 224 $ 46,700 $ 63,817 3,166 2,392 $ 69,375 Carryingamount
				$ 10,541 2,121 1,865 $ 14,527 $ 63,391 2,674 942 $ 67,007

The Company reported net gain (realized and unrealized) on exchange totaling NT$1,216 thousand in 2022 and NT$304 thousand in 2021. Due to the broad diversity of foreign currencies used for transactions, the Company was unable to disclose exchange gains/losses separately for each significant foreign currency.

XXIX. Additional Disclosures

• (I) Information related to significant transactions:

• Loans to external parties. (None)

• Endorsements/guarantees to external parties. (None)

• Marketable securities held at year-end. (Appendix 1)

• Cumulative purchase or sale of a single security totaling more than NT$ 300 million or 20% of paid-in capital. (None)

• Acquisition of real estate properties amounting to more than NT$ 300 million or 20% of paid-in capital. (None)

• Disposal of real estate properties amounting to more than NT$ 300 million or 20% of paid-in capital. (None)

• Sales and purchases to/from related parties amounting to more than NT$ 100 million or 20% of paid-in capital. (None)

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• Related party receivables amounting to more than NT$ 100 million or 20% of paid-in capital. (None)

• Trading of derivatives. (None)

• (II) Information on business investments. (Appendix 2)

• (III) Information relating to investments in the Mainland. (None) (IV) Major shareholders: Names of shareholders with more than 5% ownership interest, and the number and percentage of shares held. (Appendix 3)

• 50 -

Unit: NTD thousand

Tonlin Department Store Co., Ltd. and Subsidiaries Marketable securities held December 31, 2022

Table 1

Holding Company Name	Name and type of marketable security	Relationship with the Holding Company	Financial Statement Account		December 31,2022	December 31,2022	December 31,2022	Remarks
				Shares / units	Carrying amount	Shareholding percentage	Fair value
Tonlin Department Store Co., Ltd.	Common share Harbinger Venture Capital Corp. Wholesome Biopharm Pty Ltd. KDH Design CO., Ltd. Budworth Investment Limited Julien's International Entertainment Group Co., Ltd. Preferred share Phyto Ceutica Inc. Beneficiary certificate CTBC Asia Pacific Real Income Fund Taishin 1699 Money Market Allianz Taiwan Money Market Fund Neuberger Berman Taiwan 5G Equity Fund Union Money Market Fund Hua Nan Phoenix Money Market Fund SinoPac Yuanta De-Li Money Market Fund Fuh Hwa South Africa Short-Term Income ZAR Fund B	- - - - - - - - - - - - - -	Equity instrument at FVTOCI - Non-current Equity instrument at FVTOCI - Non-current Equity instrument at FVTOCI - Non-current Equity instrument at FVTOCI - Non-current Equity instrument at FVTOCI - Non-current Equity instrument at FVTOCI - Non-current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current	3,367 10,000,000 40,000 15,186 373,501 20,000 200,000.00 3,656,249.56 2,363,882.27 143,575.02 745,695.47 908,109.40 2,418,440.60 60,260.90	$ - 12,630 - - 4,563 - 2,066 50,329 30,105 1,836 10,004 15,002 40,072 980	1.70 12.16 2.03 1.67 1.30 - - - - - - - - -	$ - 12,630 - - 4,563 - 2,066 50,329 30,105 1,836 10,004 15,002 40,072 980

(Continued on next page)

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(Continued)

Holding Company Name	Name and type of marketable security	Relationship with the Holding Company	Financial Statement Account		December 31,2022	December 31,2022	December 31,2022	Remarks
				Shares / units	Carrying amount	Shareholding percentage	Fair value
	Pictet-Russian Equities R BlackRock Global Funds - World Technology Fund A2 LionGlobal Vietnam Fund BlackRock World Mining Fund BNP Paribas Funds Energy Transition JPMorgan Funds - US Technology Fund A AB - American Income Portfolio AT Inc Allianz Income and Growth (BM) Jih Sun Vietnam Opportunity Fund Allianz Income and Growth (AM) JPMorgan Funds - Global Natural Resources Fund JPMorgan Funds - Emerging Middle East Equity Fund Allianz Income and Growth (AM) - Rand Franklin Templeton SinoAm New World Fund - CNY Nomura Global Infrastructure Megatrend Fund - CNY - Bonds Brazilian Government Bonds (VII) - Corporate bonds Petroleos Mexicanos corporate bonds (VII) Apple Inc. Corporate Bonds (VII)	- - - - - - - - - - - - - - - - - -	Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current	176.27 94.08 43,422.48 346.63 400.00 273.84 1,771.84 18,315.02 3,000.00 2,550.33 2,989.07 430.95 7,962.74 9,434.00 60,000.00 2,000 2,500 1,700	$ 288 139 795 676 1,187 461 1,533 4,668 593 595 1,265 411 1,412 701 2,465 4,524 4,713 4,233	- - - - - - - - - - - - - - - - - -	$ 288 139 795 676 1,187 461 1,533 4,668 593 595 1,265 411 1,412 701 2,465 4,524 4,713 4,233

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(Continued)

Holding Company Name	Name and type of marketable security	Relationship with the Holding Company	Financial Statement Account		December 31,2022	December 31,2022	December 31,2022	Remarks
				Shares / units	Carrying amount	Shareholding percentage	Fair value
	Altria USD bonds Pertamina corporate bonds (III) Verizon Communications corporate bonds 4.25% of UnitedHealth Group’s corporate bonds Corporate bonds of CenturyLink Inc. Corporate bonds of TSMC Arizona Corporation Corporate bonds of BMW US Capital LLC Corporate bonds of AT&T Common shares of domestic companies Hon Hai Precision Industry Co., Ltd. Asia Optical Co. Inc. FuSheng Precision Co., Ltd. Crystalvue Medical Corporation Yageo Corporation Taiwan Semiconductor Manufacturing Co., Ltd. Yeong Guan Energy Technology Group Co., Ltd. Zhen Ding Technology Holding Limited Delta Electronics, Inc. YFY Inc.	- - - - - - - - - - - - - - - - - -	Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current	200 2,000 62 127 2,350 2,040 1,600 215 35,000 78,000 143,000 93,000 2,387 8,000 84,962 18,400 20,000 44,000	$ 5,589 5,208 1,757 3,517 4,834 5,963 4,545 6,323 3,496 4,719 30,101 4,836 1,076 3,588 4,834 1,932 5,730 1,076	- - - - - - - - - - - - - - - - - -	$ 5,589 5,208 1,757 3,517 4,834 5,963 4,545 6,323 3,496 4,719 30,101 4,836 1,076 3,588 4,834 1,932 5,730 1,076

(Continued on next page)

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(Continued)

Holding Company Name	Name and type of marketable security	Relationship with the Holding Company	Financial Statement Account		December 31,2022	December 31,2022	December 31,2022	Remarks
				Shares / units	Carrying amount	Shareholding percentage	Fair value
	Winbond Electronics Corp. Ardentec Corporation ShunSin Technology Holdings Limited Raydium Semiconductor Corporation United Microelectronics Corporation China Airlines Ltd. Dyaco International Inc. CTBC Financial Holding Co., Ltd. Unimicron Technology Corp. SERCOMM CORP. E-LEAD ELECTRONIC CO., LTD. Polaris Group Orient Europharma Co., Ltd. Century Iron And Steel Industrial Co., Ltd E INK HOLDINGS INC. PHIHONG TECHNOLOGY CO., LTD. JENTECH PRECISION INDUSTRIAL CO., LTD NICHIDENBO CORPORATION Fubon FTSE Vietnam ETF	- - - - - - - - - - - - - - - - - - -	Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current	73,000 50,000 28,000 31,000 94,000 135,000 62,000 440,000 42,000 65,000 64,000 23,000 131,000 118,000 30,000 60,000 5,000 19,000 90,000	$ 1,431 2,480 2,282 9,440 3,826 2,565 2,523 9,724 5,040 4,960 4,493 2,040 4,742 10,455 4,830 2,367 1,883 999 1,002	- - - - - - - - - - - - - - - - - - -	$ 1,431 2,480 2,282 9,440 3,826 2,565 2,523 9,724 5,040 4,960 4,493 2,040 4,742 10,455 4,830 2,367 1,883 999 1,002

(Continued on next page)

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(Continued)

Companies held	Name and type of marketable security	Relationship with the Holding Company	Financial Statement Account		December 31,2022	December 31,2022	December 31,2022	Remarks
				Shares / units	Carrying amount	Shareholding percentage	Fair value
GUAN CHAN INVESTMENT CO., LTD. JIA FONG INVESTMENT CO., LTD. SONG YUAN INVESTMENT CO., LTD.	Formosa Plastics Corporation SUNNY FRIEND ENVIRONMENTAL TECHNOLOGY CO., LTD Taiwan High Speed Rail Corporation Common share Tonlin Department Store Co., Ltd. Beneficiary certificate Jih Sun Money Market Fund Taishin 1699 Money Market FSITC Taiwan Money Market Common share Tonlin Department Store Co., Ltd. Beneficiary certificate Mega Diamond Money Market FSITC Taiwan Money Market Common share Tonlin Department Store Co., Ltd. Beneficiary certificate FSITC Taiwan Money Market Taishin 1699 Money Market ASIAN TIGER BOND A2 USD US SENIOR LOAN FUND GLOBAL REAL ASSET SECURITIES	- - - Parent company - - - Parent company - - Parent company - - - - -	Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Equity instrument at FVTOCI - Non-current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Equity instrument at FVTOCI - Non-current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Equity instrument at FVTOCI - Non-current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current	26,000 9,000 415,000 8,750,000 103,455.50 228,508.64 26,926.80 8,767,000 182,511.63 327,162.10 7,366,000 77,693.80 72,862.93 2,308.94 523.64 696.28	$ 2,257 1,557 11,931 264,688 1,559 3,145 419 265,202 2,326 5,088 222,821 1,208 1,003 2,573 2,993 2,310	- - - 4.19 - - - 4.20 - - 3.53 - - - - -	$ 2,257 1,557 11,931 264,688 1,559 3,145 419 265,202 2,326 5,088 222,821 1,208 1,003 2,573 2,993 2,310	(Note 1 and 2) (Note 1 and 2) (Note 1 and 2)

(Continued on next page)

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(Continued)

Holding Company Name	Name and type of marketable security	Relationship with the Holding Company	Financial Statement Account		December 31,2022	December 31,2022	December 31,2022	Remarks
				Shares / units	Carrying amount	Shareholding percentage	Fair value
SHUN TAI INVESTMENT CO., LTD.	AHL TREND ALTERNATIVE NEUBERGER BERMAN UNCORRELATED STRATEGIES Foreign bonds 4.305% STANDARD CHARTERED PLC SR UNSECURED - Foreign shares PAYPAL HOLDINGS INC Common share Tonlin Department Store Co., Ltd. Beneficiary certificate FSITC Taiwan Money Market Taishin 1699 Money Market	- - - - Parent company - -	Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Financial assets at FVTPL - Current Equity instrument at FVTOCI - Non-current Financial assets at FVTPL - Current Financial assets at FVTPL - Current	1,247.76 4,081.32 200,000 2,000 8,439,000 193,695.80 72,866.12	$ 6,207 1,383 5,478 4,374 255,280 3,012 1,003	- - - - 4.04 - -	$ 6,207 1,383 5,478 4,374 255,280 3,012 1,003	(Note 1 and 2)

Note 1: Subsidiaries' holding of the Company's shares were reclassified as treasury stock, and accounted using the book value at which the Company was recognized as investment by the subsidiary in the beginning of 2002. Note 2: See Appendix 2 for information relating to investments in subsidiaries and associated companies.

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Tonlin Department Store Co., Ltd. and Subsidiaries Information of Investees

2022

Table 2

Unit: NTD thousand

Investor	Investor Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	As of December 31,2022	As of December 31,2022	As of December 31,2022	Current period profit (loss) of the investee (Note 2)	Investment gains (losses) recognized in the current period (Note 2)	Remarks
				December 31, 2022	December 31, 2021	Shares	Percentage (%)	Carrying amount
Tonlin Department Store Co., Ltd.	De Hong Development Co., Ltd. Chung Hsiao Enterprise Co., Ltd. SONG YUAN INVESTMENT CO., LTD. SHUN TAI INVESTMENT CO., LTD. GUAN CHAN INVESTMENT CO., LTD. JIA FONG INVESTMENT CO., LTD.	Taipei City Taipei City Taipei City Taipei City Taipei City Taipei City	General construction General leasing Investment Investment Investment Investment	$ 600,000 151,352 350,000 350,000 350,000 350,000	$ 600,000 101,952 350,000 350,000 350,000 350,000	45,000,000 5,076,000 35,000,000 35,000,000 35,000,000 35,000,000	100.00 26.89 100.00 100.00 100.00 100.00	$ 382,899 183,935 81,024 44,008 29,393 28,973	( $ 36,346 ) 20,822 3,613 5,766 4,425 4,643	( $ 36,346 ) 4,113 ( 70 ) 1,546 50 260	Subsidiary (Notes 2) Equity-accounte d investee (Note 4) Subsidiary (Notes 1, 2, and 3) Subsidiary (Notes 1, 2, and 3) Subsidiary (Notes 1, 2, and 3) Subsidiary (Notes 1, 2, and 3)

Note 1: Subsidiaries' holding of the Company's shares were reclassified as treasury stock, and accounted using the book value at which the Company was recognized as investment by the subsidiary in the beginning of 2002. Note 2: Calculated based on the entity's audited financial statements as at December 31, 2022. Note 3: Differences between investment gains/losses the Company had recognized on SONG YUAN INVESTMENT CO., LTD., SHUN TAI INVESTMENT CO., LTD., GUAN CHAN INVESTMENT CO., LTD., and JIA FONG INVESTMENT CO., LTD. and the amount of profit/loss reported by the respective investees were due to distribution of dividends.

Note 4: On November 4, 2022, the Company purchased 1,300,000 shares of Chung Hsiao Industrial Co. Ltd. with NT$49,400 thousand from New Leader Asia Enterprise Ltd. upon the Board’ resolution, and 6.89% of stake was acquired. The delivery was completed on November 7, 2022.

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Tonlin Department Store Co., Ltd. and Subsidiaries Information on main investors

December 31, 2022

Table 3

Name of major shareholder	Shares	Shares
	No. of shares held	Shareholding percentage(%)
SHUEN SHYANG CO., LTD. JIN DUO LIH ENTERPRISES PTY. LTD. Weng Chun-Chih FlySun Development Co.,Ltd.	35,913,664 22,936,442 21,337,920 12,579,333	17.20 10.98 10.22 6.02

• Note 1: Information on major shareholders, as presented in this chart, was taken from records of Taiwan Depository & Clearing Corporation as at the final business day of the reported quarter, and included parties holding book-entry common and preferred shares (including treasury stock) for an aggregate ownership of 5% and above. Share capital reported in the Company's consolidated financial statements may differ from the number of shares delivered via book entry due to different basis of preparation/calculation.

• Note 2: The aforementioned information will be disclosed by the trustors’ personal accounts settled by the trustees If the shareholders put the shares into a trust. As for the insider declaration of the ownership percentage over 10%, including the shares on hand and those being put in the trust and may be able to decide the usage of the trust assets, please refer to the declaration information on Market Observation Post System (MOPS).

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§Table of Contents for the Key Accounting Item Detailed Table§

Item Detailed table of assets, liabilities, and equity Detailed table of cash and cash equivalents I Detailed table of financial assets at FVTPL - Current II Detailed table of other receivables Note 10 Detailed table of inventories Note 11 Detailed table of prepayments and other current assets III Detailed table of financial assets measured at FVTOCI changes IV Detailed table of investment with the equity method V Detailed table of property, plant and equipment changes Note 13 Detailed table of property, plant and equipment depreciation changes Note 13 Detailed table of property, plant and equipment accumulated impairment changes Note 13 Detailed table of investment property changes Note 14 Detailed table of investment property accumulated impairment changes Note 14 Detailed table of deferred income tax assets Note 22 Detailed table of short-term borrowings VI Detailed table of long-term borrowings VII Detailed table of deferred income tax liabilities Note 22 Detailed table of profit or loss items Detailed table of operating revenue VIII Detailed table of operating costs IX Detailed table of operating expenses X Aggregation table of the employee benefits, depreciation and amortization expenses incurred during the period, by function XI

No./Index

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Tonlin Department Store Co., Ltd. Detailed table of cash and cash equivalents December 31, 2022

		December 31, 2022	December 31, 2022	December 31, 2022
Detailed table	1	Unit: NTD Thousand, unless stated otherwise
Name		Summary	Amount
Petty cash and cash on hand			$	220
Cash in banks
Foreign currency
		USD (USD$62,408) (Note)		1,916
		CNY (CNY$2,697) (Note)		12
		South African Rand		224
		(ZAR$123,713) (Note)
				2,152
Demand	deposits			57,572
Cheque deposit				604
	Subtotal			60,328
Cash equivalents - time		US$1,414 thousand, expired on		43,424
deposits with an original		January 6, 2023 to March 28,
tenor of 3 months or less.		2023 , with the annual
		interest rate of
		3.80%~4.50%.
		CNY255 thousand, expired on		1,124
		February 28, 2023, with the
		annual interest rate of
		1.17%.
Subtotal				44,548
Total			$	105,096
Note: exchange rate at USD$1＝NTD$30.710
	CNY$1＝NTD$4.408
	ZAR$1＝NTD$1.811

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Tonlin Department Store Co., Ltd. Detailed table of financial assets at FVTPL - Current December 31, 2022

Detailed table II

Unit: NTD Thousand, unless stated otherwise

Name of security Financial assets measured at FVTPL- domestic TWSE/TPEx listed shares Hon Hai Precision Industry Co., Ltd. Asia Optical Co. Inc. FuSheng Precision Co., Ltd. Crystalvue Medical Corporation Yageo Corporation Taiwan Semiconductor Manufacturing Co., Ltd. Yeong Guan Energy Technology Group Co., Ltd. Zhen Ding Technology Holding Limited Delta Electronics, Inc. YFY Inc. Winbond Electronics Corp. Raydium Semiconductor Corporation ShunSin Technology Holdings Limited Raydium Semiconductor Corporation United Microelectronics Corporation China Airlines Ltd. Dyaco International Inc. CTBC Financial Holding Co., Ltd. Unimicron Technology Corp. SERCOMM CORP. E-LEAD ELECTRONIC CO.,LTD. Polaris Group Orient Europharma Co., Ltd. Century Iron And Steel Industrial Co.,Lt E INK HOLDINGS INC. PHIHONG TECHNOLOGY CO., LTD. JENTECH PRECISION INDUSTRIAL CO., LTD NICHIDENBO CORPORATION Fubon FTSE Vietnam ETF Formosa Plastics Corporation SUNNY FRIEND ENVIRONMENTAL TECHNOLOGY CO., LTD Taiwan High Speed Rail Corporation Subtotal	Units 35,000 78,000 143,000 93,000 2,387 8,000 84,962 18,400 20,000 44,000 73,000 50,000 28,000 31,000 94,000 135,000 62,000 440,000 42,000 65,000 64,000 23,000 131,000 118,000 30,000 60,000 5,000 19,000 90,000 26,000 9,000 415,000		Amount $ 3,496 4,719 30,101 4,836 1,076 3,588 4,834 1,932 5,730 1,076 1,431 2,480 2,282 9,440 3,826 2,565 2,523 9,724 5,040 4,960 4,493 2,040 4,742 10,455 4,830 2,367 1,883 999 1,002 2,257 1,557 11,931 154,215	Market price	Market price	Market price
				Unit price (NTD) 99.90 60.50 210.50 52.00 451.00 448.50 56.90 105.00 286.50 24.45 19.60 49.60 81.50 304.50 40.70 19.00 40.70 22.10 120.00 76.30 70.20 88.70 36.20 88.60 161.00 39.45 376.50 52.60 11.13 86.80 173.00 28.75	Total amount
						$ 3,496 4,719 30,101 4,836 1,076 3,588 4,834 1,932 5,730 1,076 1,431 2,480 2,282 9,440 3,826 2,565 2,523 9,724 5,040 4,960 4,493 2,040 4,742 10,455 4,830 2,367 1,883 999 1,002 2,257 1,557 11,931 154,215

(Continued on next page)

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(Continued)

Name of security Financial assets measured at FVTPL- domestic beneficiary certificate CTBC Asia Pacific Real Income Fund Taishin 1699 Money Market Allianz Taiwan Money Market Fund Neuberger Berman Taiwan 5G Equity Fund Union Money Market Fund Hua Nan Phoenix Money Market Fund SinoPac Yuanta De-Li Money Market Fund Subtotal Financial assets measured at FVTPL- foreign beneficiary certificate Fuh Hwa South Africa Short-Term Income ZAR Fund B Pictet-Russian Equities R BlackRock Global Funds - World Technology Fund A2 LionGlobal Vietnam Fund BlackRock World Mining Fund BNP Paribas Funds Energy Transition JPMorgan Funds - US Technology Fund A AB - American Income Portfolio AT Inc Allianz Income and Growth (BM) Jih Sun Vietnam Opportunity Fund Allianz Income and Growth (AM) JPMorgan Funds - Global Natural Resources Fund JPMorgan Funds - Emerging Middle East Equity Fund Allianz Income and Growth (AM) - Rand Franklin Templeton SinoAm New World Fund - CNY Nomura Global Infrastructure Megatrend Fund - CNY Subtotal Financial assets at FVTPL - bond Brazilian Government Bonds (VII) Pemex Corporate Bonds (VII) Apple Inc. Corporate Bonds (VII) Altria USD bonds Pertamina corporate bonds (III) Verizon Communications corporate bonds 4.25% of UnitedHealth Group’s corporate bonds	Units 200,000.00 3,656,249.56 2,363,882.27 143,575.02 745,695.47 908,109.40 2,418,440.60 60,260.90 176.27 94.08 43,422.48 346.63 400.00 273.84 1,771.84 18,315.02 3,000.00 2,550.33 2,989.07 430.95 7,962.74 9,434.00 60,000.00 2,000 2,500 1,700 200 2,000 62 127		Amount $ 2,066 50,329 30,105 1,836 10,004 15,002 40,072 149,414 980 288 139 795 676 1,187 461 1,533 4,668 593 595 1,265 411 1,412 701 2,465 18,169 4,524 4,713 4,233 5,589 5,208 1,757 3,517	Market price	Market price	Market price
				Unit price (NTD) 10.3300 13.7652 12.7353 12.7900 13.4158 16.5195 16.5694 16.2627 1,631.0081 1,471.9303 18.3032 1,950.3921 2,966.8931 1,684.7056 865.1007 254.8930 197.7724 233.3960 423.1838 953.8526 177.3331 74.3188 41.0825 2,261.7915 1,885.2869 2,490.2739 27,946.1000 2,603.9009 28,345.3300 27,691.2070	Total amount
						$ 2,066 50,329 30,105 1,836 10,004 15,002 40,072 149,414 980 288 139 795 676 1,187 461 1,533 4,668 593 595 1,265 411 1,412 701 2,465 18,169 4,524 4,713 4,233 5,589 5,208 1,757 3,517

(Continued on next page)

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(Continued)

Name of security Corporate bonds of CenturyLink Inc. Corporate bonds of TSMC Arizona Corporation Corporate bonds of BMW US Capital LLC Corporate bonds of AT&T Subtotal Total	Units 2,350 2,040 1,600 215		Amount $ 4,834 5,963 4,545 6,323 51,206 $ 373,004	Market price	Market price	Market price
				Unit price (NTD) 2,056.9558 2,922.9778 2,840.6750 29,407.8960	Total amount
						$ 4,834 5,963 4,545 6,323 51,206 $ 373,004

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Tonlin Department Store Co., Ltd. Detailed table of prepayments and other current assets December 31, 2022

December 31, 2022
Detailed table III Item Prepayments Temporary debits and payment on behalf of others Other current assets Offset against value-added tax payable Office supplies Insurance premium Others (note) Subtotal of other current assets Total	Unit: NTD thousand Amount
		$ 544 19,177 957 1,774 1,164 23,072 $ 23,616

Note: each item’s balance does not exceed 5% of the balance of the account.

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Tonlin Department Store Co., Ltd. Detailed table of financial assets measured at FVTOCI- non-current changes January 1 to December 31, 2022

Detailed table IV Common shares WK Technology Fund WK Technology Fund VII WK Technology Fund VIII WK Technology Fund V Harbinger Venture Capital Corp. Julien's International Entertainment Group Co., Ltd. Preference shares Phyto Ceutica Inc. Overseas venture capitals KDH design Co., Ltd. Budworth Investment Limited Wholesome Biopharm Pty Ltd. Total	Opening	balance Amount $ 3,632 660 295 421 - 4,563 9,571 - - - 12,630 12,630 $ 22,201	Increase in current year Shares Amount - $ - - - - - - - - - - - - - - - - - - - - - $ -	Increase in current year Shares Amount - $ - - - - - - - - - - - - - - - - - - - - - $ -	Decrease in current year Shares Amount 29,914 $ 3,632 896,000 660 1,589,500 295 1,192,125 421 - - - - 5,008 - - - - - - - - - $ 5,008	Decrease in current year Shares Amount 29,914 $ 3,632 896,000 660 1,589,500 295 1,192,125 421 - - - - 5,008 - - - - - - - - - $ 5,008		Closing balance		Amount $ - - - - - 4,563 4,563 - - - 12,630 12,630 $ 17,193	Unit: NTD thousand Guarantee provided or pledge Remarks Note 1 None Note 2 None Note 3 None Note 4 None None None None None None None
	Shares 29,914 896,000 1,589,500 1,192,125 3,367 373,501 20,000 40,000 15,186 10,000,000		Shares - - - - - - - - - -		Shares 29,914 896,000 1,589,500 1,192,125 - - - - - -		Shares - - - - 3,367 373,501 20,000 40,000 15,186 10,000,000	Shareholding % - - - - 1.70 1.30 - 2.03 1.67 12.16

Note 1: The decrease in the current year is the actuarial share payment refunded due to capital decrease, for NT$293 thousand. Note 2: The decrease in the current year is the actuarial share payment refunded due to capital decrease, for NT$1,279 thousand. Note 3: The decrease in the current year is the actuarial share payment refunded due to capital decrease, for NT$1,490 thousand. Note 4: The decrease in the current year is the actuarial share payment refunded due to capital decrease, for NT$1,169 thousand.

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Tonlin Department Store Co., Ltd. Detailed table of investment with the equity method January 1 to December 31, 2022

Detailed table V

Unit: NTD thousand

Gain (loss) on the De Hong Development Co., Ltd. SONG YUAN INVESTMENT CO., LTD. SHUN TAI INVESTMENT CO., LTD. GUAN CHAN INVESTMENT CO., LTD. JIA FONG INVESTMENT CO., LTD. Chung Hsiao Enterprise Co., Ltd. Total	Opening	balance Amount $ 419,245 82,066 41,917 28,951 28,418 146,467 $ 747,064	Increase in current year Shares Amount - $ - - 3,683 - 5,766 - 4,425 - 4,643 1,300,000 53,513 $ 72,030	Increase in current year Shares Amount - $ - - 3,683 - 5,766 - 4,425 - 4,643 1,300,000 53,513 $ 72,030	Decrease in current year Shares Amount - $ 36,346 - 4,725 - 3,675 - 3,983 - 4,088 - 16,045 $ 68,862	Decrease in current year Shares Amount - $ 36,346 - 4,725 - 3,675 - 3,983 - 4,088 - 16,045 $ 68,862	Closing balance	Closing balance	Closing balance	Amount $ 382,899 81,024 44,008 29,393 28,973 183,935 $ 750,232	Market price or net worth of shares $ 382,899 81,024 44,008 29,393 28,973 183,935	Remarks Note 1 and 2 Note 1 and 3 Note 1 and 4 Note 1 and 5 Note 1 and 6 Note 1 and 7	Guarantee provided or pledge
	Shares 45,000,000 35,000,000 35,000,000 35,000,000 35,000,000 3,776,000		Shares - - - - - 1,300,000		Shares - - - - - -		Shares 45,000,000 35,000,000 35,000,000 35,000,000 35,000,000 5,076,000	Shareholdi ng% 100% 100% 100% 100% 100% 26.89%
													None None None None None None

Note 1: The calculation is based on the financial statements of the investees audited by the CPAs as of December 31, 2022. Note 2: The decrease in the year is the recognition of investment losses of the year for NT$36,346 thousand.

Note 3: The increase in the year is that the Company released cash dividends for NT$3,683 thousand; the decrease in the year is the recognition of investment losses in subsidiary for NT$70 thousand and released cash dividends for NT$4,655 thousand. Note 4: The increase in the year is the recognition of investment gains of subsidiary for NT$1,546 thousand, and released cash dividends for NT$4,220 thousand; the decrease in the year is that the subsidiary released cash dividends for NT$3,675 thousand.

Note 5: The increase in the year is the recognition of investment gains of subsidiary for NT$50 thousand, and released cash dividends for NT$4,375 thousand; the decrease in the year is that the subsidiary released cash dividends for NT$3,983 thousand.

Note 6: The increase in the year is the recognition of investment gains of subsidiary for NT$260 thousand and the Company released cash dividends for NT$4,383 thousand; the decrease in the year is that the subsidiary released cash dividends for NT$4,088 thousand.

Note 7: The increase in the year is the recognition of subsidiary’s investment gains of NT$4,113 thousand; and the Company purchased 1,300,000 shares of Chung Hsiao Industrial Co. Ltd. with NT$49,400 thousand from New Leader Asia Enterprise Ltd. upon the Board’ resolution, for 6.89% of stake; the decrease in the year include the cash dividends distributed by an affiliate for NT$3,156 thousand, the recognition of the unrealized loss on valuation of equity instruments at FVTOCI by the investee for NT$12,889 thousand.

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Tonlin Department Store Co., Ltd. Detailed table of short-term borrowings December 31, 2022

Detailed table VI Types of borrowings and names of creditors Bank secured borrowings CTBC Bank of Taiwan	Closingbalance $ 430,000 234,000 $ 664,000	Borrowing period December 2, 2022 to March 2, 2023 October 18, 2022 to January 10, 2023	Interest rate (%) 1.410% 1.395%		Financing facilities $ 600,000 420,000 $ 1,020,000	Unit: NTD thousand Mortgage and collaterals
						B2, 2F to 4F, and 16 parking spaces at No. 201, Zhongxiao E. Rd, Sec. 4, Taipei City B2 to 4F at No. 61, Zhongzheng Rd., Taoyuan City

註： The short-term financing facilities of the Company are NT$1,020,000 thousand As of December 31, 2022, the drawn financing facilities were NT$664,000 thousand; and remaining short-term financing facilities were NT$356,000 thousand

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Detailed table VII Creditors Secured borrowings Bank of Taiwan Hua Nan Bank First Commercial Bank Bank SinoPac Taishin Bank Unsecured borrowings Bank of Taiwan Less: parts that listed as due within in a year Total	Tonlin Department Store Detailed table of long-term December 31, 20 Expiration of contract Interest rate per annum(%) July 19, 2022 to July 19, 2025 1.400%~1.665% September 23, 2022 to September 23, 2023 (Note) 1.580%~1.630% October 3, 2022 to January 3, 2024 1.625% November 10, 2022 to November 30, 2024 1.750% September 30, 2022 to September 30, 2024 - July 19, 2022 to July 19, 2025 - (	Tonlin Department Store Detailed table of long-term December 31, 20 Expiration of contract Interest rate per annum(%) July 19, 2022 to July 19, 2025 1.400%~1.665% September 23, 2022 to September 23, 2023 (Note) 1.580%~1.630% October 3, 2022 to January 3, 2024 1.625% November 10, 2022 to November 30, 2024 1.750% September 30, 2022 to September 30, 2024 - July 19, 2022 to July 19, 2025 - (	Co., Ltd. borrowings 22 Amount $ 444,000 190,000 350,000 1,000,000 - - 1,984,000 140,000) $ 1,844,000	Financingfacilities $ 600,000 493,000 350,000 1,400,000 278,000 100,000 $ 3,221,000	Unit: NTD thousand Pledged or secured
		(			B2 to 4F at No. 61, Zhongzheng Rd., Taoyuan City 8F-9, 10F-6 and 7, 10F-10 and 11, 13F-1 at No. 197, Zhongxiao E. Rd, Sec. 4, Taipei City; 7F and 7F-1 at No. 201, Zhongxiao E. Rd, Sec. 4, Taipei City. 5F to 6F at No. 61, Zhongzheng Rd., Taoyuan City B1 and 1F at No. 201, Zhongxiao E. Rd, Sec. 4, Taipei City; 7F to 8F at No. 61, Zhongzheng Rd., Taoyuan City 9F, 10F, and 12F at No. 61, Zhongzheng Rd., Taoyuan City None

Note: The credit limit was NT$293,000 thousand, and the contract term was from December 31, 2019 to January 12, 2022; additionally, a new contract was entered on September 3, 2021 with the credit limit

of NT$493,000 thousand, which might be shared with the short-term secured borrowing; the contract term was from September 3, 2021 to September 3, 2022. Extended to September 23, 2023 on September 23, 2022. Within the borrowing limit, term of each drawdown is three years.

• 68 -

Tonlin Department Store Co., Ltd. Detailed table of operating revenue January 1 to December 31, 2022

Tonlin Department Store Co., Ltd. Detailed table of operating revenue January 1 to December 31, 2022
Detailed table VIII Item Sale Revenues from sale of merchandise Retail commission income Less: Sales returns Sales discounts and allowances Net sales revenues Lease incomes Construction incomes Other operating revenues Total operating revenue	Unit: NTD thousand Amount $ 5,010 118,967 123,977 345 5,043 5,388 118,589 263,491 34,652 37,033 $ 453,765

• 69 -

Tonlin Department Store Co., Ltd. Detailed table of operating costs January 1 to December 31, 2022

Detailed table IX

Unit: NTD thousand

Item Cost of sales Beginning inventories- self’s operation Plus: Purchase of goods in the year- self’s operation Less: Purchases returns Purchases discounts and allowances Total goods available for sale in the year Less: Ending inventories- self’s operation Inventory (profit) loss Cost of leasing Tax and levy Depreciation Repairment expenses Others (note) Other operating costs Construction cost Operating costs		Amount
		$ 3,169 3,124 - - 6,293 2,329 11 3,975 10,429 16,356 4,110 6,035 36,930 23,589 30,008 $ 94,502

Note: each item’s balance does not meet 5% of the total leasing costs

• 70 -

Tonlin Department Store Co., Ltd. Detailed table of operating expenses January 1 to December 31, 2022 Detailed table XI Item HR expense (including salaries, severance pay, labor and health insurance, pensions and other benefits) Depreciation Tax and levy Utilities expense Others (note) Total	Unit: NTD thousand Amount	Unit: NTD thousand Amount
		$ 60,229 55,371 13,347 9,276 28,462 $ 166,685

Note: each item’s balance does not meet 5% of the total operating expenses

• 71 -

Tonlin Department Store Co., Ltd.

Aggregation table of the employee benefits and depreciation incurred during the year, by function From January 1 to December 31, 2022 and 2021

Detailed table XII Unit: NTD thousand

Employee benefits expense Salary expenses Labor and health insurance expenses Pension expenses Directors’ compensations Other employee benefit expenses Amortization Depreciation expense		2022		Total $ 43,021 5,109 2,248 7,295 2,556 $ 60,229 $ 1,187 $ 72,758		2021
	Under operating costs $ - - - - - $ - $ 149 $ 17,387	Under operating expenses $ 43,021 5,109 2,248 7,295 2,556 $ 60,229 $ 1,038 $ 55,371			Under operating costs $ - - - - - $ - $ 148 $ 16,140	Under operating expenses $ 46,218 5,171 2,289 9,100 2,151 $ 64,929 $ 454 $ 55,690		Total
								$ 46,218 5,171 2,289 9,100 2,151 $ 64,929 $ 602 $ 71,830

Note 1: As of December 31, 2022 and 2021, the employees of the Company were 81 and 85, respectively, and the directors not concurrently serving as employees were both eight.

• Note 2: The average employee benefit expenses of the year was NT$725 thousand (“The total employee benefit expenses of the year - total directors’ compensations” / “Employees during the year - directors not concurrently serving as employees”) The average employee benefit expenses of the year was NT$725 thousand (“The total employee benefit expenses of the previous year - total directors’ compensations” / “Employees during the previous year - directors not concurrently serving as employees”) .

Note 3: The average employee salary expenses of the year was NT$589 thousand (“The total salary expenses of the year ” / “Employees during the year - directors not concurrently serving as employees”) The average employee salary expenses of the year was NT$600 thousand (“The total salary expenses of the previous year / “Employees during the previous year - directors not concurrently serving as employees”)

• Note 4: The change of the average employee salary expenses: -1.8% (“The total salary expenses of the year - the total salary expenses of the previous year” / “The total salary expenses of the previous year”

• Note 5: The Company’s salaries to general employees and managerial officers is based on the nature of the work, while referring to the salary level of peers from time to time for adjustment. The salaries of the managerial officers are approved by the Remuneration Committee. The Company’s salaries are paid monthly, and year-end bonuses and employee bonuses may be released annually based on operating conditions (0.1% to 4% of the net profit before tax excluding employee bonuses and directors’ remunerations). The salaries of the directors (including independent directors) of the Company are divided into transportation allowance and director's remuneration; the transportation allowance is paid monthly, and the director's remuneration is paid based on the operating conditions (the maximum shall not exceed 4% of the net profit before tax excluding employee bonuses and directors’ remunerations).

Explanation:

• I. For the information on the number of employees explained in the notes to this table, the calculation basis shall be consistent to the employee benefits and employee salary expenses, and the average number of employees should be used for calculation.

• II. Pursuant to International Accounting Standards No. 19, employees may provide services in the manner of full-time, part-time, permanent, irregular or temporary, including directors and other management personnel. Therefore, “employees” in this table include directors, managerial officers, general employees and contracted hires., but do not include supervisors, dispatched manpower, labor contracting or business outsourced personnel.

• III. The term "directors' remunerations" refers to the remuneration received by all directors, retirement pensions, directors' remuneration and business execution expenses, but does not include salaries, labor and health insurance, pensions and other benefits received for concurrently serving as employees.

• 72 -