TTC - Audit Report / Information 2021

Taita Chemical Co., Ltd.

Financial Statements and Independent Auditors’ Report for the Years Ended December 31, 2021 and 2020 and Independent Auditors’Report

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders

Taita Chemical Co., Ltd.

Opinion

We have audited the accompanying financial statements of Taita Chemical Co., Ltd. (the “Company”), which comprise the balance sheets as of December 31, 2021 and 2020, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the financial statements, including a summary of significant accounting policies (collectively referred to as the “financial statements”).

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended December 31, 2021. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

The key audit matters identified in the Company’s financial statements for the year ended December 31, 2021 are stated as follows:

Authenticity of the Recognition of Sales Revenue from Customers of Specific Products

Due to the market demand and the fluctuation of international crude oil price, the sales revenue of the Company has increased significantly in 2021, compared to 2020. However, the sales revenue of 2021 was mainly from specific products, and the sales revenue from some customers has increased significantly in great amounts. Whether these sales revenues are recognized when the contractual obligations are actually met will have a significant impact on the financial statements and is therefore the key audit matter for the year.

For relevant accounting policies and disclosures of the recognition of sales revenue, please refer to Notes 4 and 23 of the financial statements.

We performed the corresponding audit procedures, for the authenticity of the recognition of sales revenue, as follows:

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We understood and test the Company’s internal control procedures on the recognition of sales revenue and its effectiveness. Also, we evaluate the appropriateness of the accounting policies used by management for the recognition of sales revenue.
We verify the authenticity of the recognition of sales revenue by examining the certificate of sales transactions, including purchase orders, shipping orders, export documents and collection information.
We review any occurrence of sales returns, discounts and allowances, and whether there are any abnormalities in the collections after the balance sheet date.

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

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

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

Auditors’ Responsibilities for the Audit of the Financial Statements

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

As part of an audit in accordance with the auditing standards generally accepted in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in
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our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Company to express an opinion on the financial statements. We are responsible for the direction, supervision, and performance of the audit. We remain solely responsible for our audit opinion.

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

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements for the year ended December 31, 2021 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Hsiu-Chun Huang and Cheng-Chun Chiu.

Deloitte & Touche

Taipei, Taiwan, Republic of China

March 9, 2022

Notice to Readers:

The financial statement (Chinese version) of our company is audited by the CPA Huang, Hsiu-Chun and CPA Chiu, Cheng-Chun of Deloitte Taiwan. For the convenience of reading, the statement has been translated from Chinese to English. If there is any difference regarding the context or interpretation in the English version, the Chinese version shall prevail.

TAITA CHEMICAL CO., LTD.

BALANCE SHEETS (In Thousands of New Taiwan Dollars) DECEMBER 31, 2021 AND 2020

Code 1100 1110 1136 1150 1170 1180 1200 1210 130X 1410 11XX 1517 1550 1600 1755 1760 1780 1840 1900 15XX 1XXX Code 2100 2120 2170 2180 2200 2220 2230 2280 2365 2399 21XX 2540 2570 2580 2640 2670 25XX 2XXX 3110 3200 3310 3320 3350 3300 3400 3XXX	ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 4 and 6) Financial assets at fair value through profit or loss - current (Notes 4 and 7) Financial assets at amortized cost - current (Notes 4, 9 and 30) Notes receivable (Notes 4 and 10) Accounts receivable (Notes 4, 5 and 10) Accounts receivable from related parties (Notes 4, 5, 10 and 29) Other receivables (Notes 4 and 10) Other receivables from related parties (Notes 4, 10 and 29) Inventories (Notes 4, 5 and 11) Prepayments and other current assets Total current assets NON-CURRENT ASSETS Financial assets at fair value through other comprehensive income - non- current (Notes 4 and 8) Investments accounted for using the equity method (Notes 4, 5, and 12) Property, plant and equipment (Notes 4, 13, 17, 29 and 30) Right-of-use assets (Notes 4, 14 and 29) Investment properties, net (Notes 4, 15, 17 and 30) Intangible assets (Notes 4 and 16) Deferred tax assets (Notes 4 and 25) Other non-current assets (Note 30) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 17) Financial liabilities at fair value through profit or loss - current (Notes 4 and 7) Accounts payable (Note 18) Accounts payable to related parties (Notes 18 and 29) Other payables (Note 19) Other payables from related parties (Note 29) Current tax liabilities (Notes 4 and 25) Lease liabilities - current (Note 4, 14 and 29) Refund liabilities - current (Note 20) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Short-term borrowings (Notes 13, 15, 17 and 30) Deferred tax liabilities (Notes 4 and 25) Lease liabilities - non-current (Note 4, 14 and 29) Net defined benefit liabilities - non-current (Note 21) Other non-current liabilities Total non-current liabilities Total liabilities Equity (Notes 12 and 22) Share capital Common stock Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Total equity TOTAL		December 31,2021	December 31,2021	％ 4 7 - - 17 - 1 2 9 1 41 5 36 16 - 1 - 1 - 59 100 3 - 9 - 4 - 4 - - 1 21 3 2 - 2 - 7 28 36 - 2 3 28 33 3 72 100		December 31,2020	December 31,2020
			Amount $ 425,875 695,975 3,000 44,729 1,787,984 542 94,017 259,271 943,406 138,507 4,393,306 476,725 3,770,026 1,710,988 41,574 108,178 4,094 62,723 24,786 6,199,094 $ 10,592,400 $ 350,000 - 947,229 28 387,449 6,795 443,684 4,564 897 54,332 2,194,978 300,000 209,012 38,374 186,419 1,804 735,609 2,930,587 3,786,541 992 273,706 308,061 2,943,210 3,524,977 349,303 7,661,813 $ 10,592,400				Amount $ 365,769 361,424 3,000 41,267 1,427,481 2,845 48,732 266,680 572,238 64,686 3,154,122 341,491 3,491,198 1,777,067 46,194 108,178 5,406 61,139 23,999 5,854,672 $ 9,008,794 $ 150,000 434 1,101,978 498 331,379 4,178 321,203 4,514 879 20,827 1,935,890 300,000 170,735 42,938 201,796 1,629 717,098 2,652,988 3,442,310 816 81,781 308,061 2,326,852 2,716,694 195,986 6,355,806 $ 9,008,794		％
									4 4 - - 16 - 1 3 6 1 35 4 39 20 - 1 - 1 - 65 100 2 - 12 - 4 - 3 - - - 21 3 2 1 2 - 8 29 39 - 1 3 26 30 2 71 100

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

Notice to Readers:

TAITA CHEMICAL CO., LTD.

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

Code 4100 NET REVENUE (Notes 4, 20, 23 and 29) 5110 COST OF GOODS SOLD (Notes 11, 13, 14, 21, 24 and 29) 5900 GROSS PROFIT 5910 UNREALIZED (GAIN) LOSS ON TRANSACTIONS WITH SUBSIDIARIES OPERATING EXPENSES (Notes 10, 14, 21, 24 and 29) 6100 Selling and marketing expenses 6200 General and administrative expenses 6300 Research and development expenses 6000 Total operating expenses 6900 PROFIT FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES (Notes 7, 12, 15, 24 and 29) 7100 Interest income 7010 Other income 7020 Other gains and losses 7070 Share of profit of subsidiaries and associates 7510 Finance costs 7000 Total non-operating income and expenses 7900 PROFIT BEFORE INCOME TAX 7950 INCOME TAX EXPENSE (Notes 4 and 25) 8200 NET PROFIT FOR THE YEAR (Continued on the next page)		2021		％ 100 80 20 - 6 1 - 7 13 - - - 2 - 2 15 3 12		2020
		Amount $ 15,726,081 12,656,293 3,069,788 2,476 910,610 117,884 18,546 1,047,040 2,025,224 1,463 61,833 36,283 ) 282,784 5,163) 304,634 2,329,858 479,926 1,849,932				Amount $ 10,993,555 8,789,022 2,204,533 419) 459,939 113,464 20,523 593,926 1,610,188 1,755 50,813 63,928 ) 670,387 10,802) 648,225 2,258,413 338,595 1,919,818		％
	( (				( ( (		(	100 80 20 - 4 1 - 5 15 - 1 1 ) 6 - 6 21 3 18

(Continued from the previous page)

(Continued from the previous page)
Code OTHER COMPREHENSIVE INCOME (LOSS) (Notes 8, 12, 21, 22 and 25) 8310 Items that will not be reclassified subsequently to profit or loss: 8311 Remeasurement of defined benefit plans 8316 Unrealized gain (loss) on investments in equity instruments at fair value through other comprehensive income 8320 Share of the other comprehensive income (loss) of associates accounted for using the equity method - unrealized gain (loss) on investments in equity instruments at fair value through other comprehensive income 8330 Share of the other comprehensive income (loss) of associates accounted for using the equity method - remeasurement of defined benefit plans 8349 Income tax relating to items that will not be reclassified subsequently to profit or loss 8360 Items that may be reclassified subsequently to profit or loss: 8361 Exchange differences on translating the financial statements of foreign operations 8371 Share of the other comprehensive loss of associates accounted for using the equity method - exchange differences on translating the financial statements of foreign operations (Continued on the next page)		2021	％ - 1 - - - 1 - -		2020
		Amount $ 10,886 ) 135,234 36,974 247 ) 2,177 163,252 22,793 ) 657 )			Amount $ 1,500 ) 132,192 36,175 628 300 167,795 85,738 95	％
	( ( ( (			(		- 1 - - - 1 1 -

(Continued from the previous page)

(Continued from the previous page)
Code 8390 Income tax relating to items that may be reclassified subsequently to profit or loss 8300 Other comprehensive loss for the year, net of income tax 8500 TOTAL COMPREHENSIVE INCOME FOR THE YEAR EARNINGS PER SHARE (Note 26) 9710 Basic 9810 Diluted		2021	％ - - 1 13		2020
		Amount $ 4,559 18,891) 144,361 $ 1,994,293 $ 4.89 $ 4.88			Amount $ 17,148) 68,685 236,480 $ 2,156,298 $ 5.07 $ 5.06	％
	(			(		- 1 2 20

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

Notice to Readers:

TAITA CHEMICAL CO., LTD.

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

Share capital(Note 22) Shares (In Thousands) Amount 334,205 $ 3,342,048 - - - - 10,026 100,262 - - - - - - - - 344,231 3,442,310 - - - - 34,423 344,231 - - - - - - - - 378,654 $ 3,786,541	Capital surplus(Note 22)	Capital surplus(Note 22)		Retained earnings(Note 22)	Retained earnings(Note 22)		Other equity (Notes 12 and	Other equity (Notes 12 and	22) Total ( $ 41,066 ) - - - - - 237,052 237,052 195,986 - - - - - 153,317 153,317 $ 349,303		Total equity
							Exchange differences on translating the financial statements of foreign operations ( $ 194,326 ) - - - - - 68,685 68,685 ( 125,641 ) - - - - - ( 18,891) ( 18,891) ($ 144,532)	Unrealized gain (loss) on financial assets at fair value through other comprehensive income $ 153,260 - - - - - 168,367 168,367 321,627 - - - - - 172,208 172,208 $ 493,835
Shares (In Thousands) 334,205 - - 10,026 - - - - 344,231 - - 34,423 - - - - 378,654	Long-tern equity investment $ 514 - - - 6 - - - 520 - - - 33 - - - $ 553	Other capital surplus $ 296 - - - - - - - 296 - - - 143 - - - $ 439	Legal reserve $ 42,017 39,764 - - - - - - 81,781 191,925 - - - - - - $ 273,706	Special reserve $ 308,061 - - - - - - - 308,061 - - - - - - - $ 308,061	Unappropriated earnings $ 647,893 ( 39,764 ) ( 100,261 ) ( 100,262 ) - 1,919,818 ( 572) 1,919,246 2,326,852 ( 191,925 ) ( 688,462 ) ( 344,231 ) - 1,849,932 ( 8,956) 1,840,976 $ 2,943,210
					( ( ( ( ( ( ( (	( ( ( ( ( (	( ( ( ( (		(	( (	$ 4,299,763 - 100,261 ) - 6 1,919,818 236,480 2,156,298 6,355,806 - 688,462 ) - 176 1,849,932 144,361 1,994,293 $ 7,661,813

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

Notice to Readers:

TAITA CHEMICAL CO., LTD.

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

Code CASH FLOWS FROM OPERATING ACTIVITIES A10000 Profit before income tax Adjustments for: A20100 Depreciation expenses A20200 Amortization expenses A20300 (Reversal of) expected credit loss A20400 Net gain on fair value change of financial assets and liabilities at fair value through profit or loss A20900 Finance costs A21200 Interest income A21300 Dividend income A22300 Share of profit of subsidiaries and associates A22500 Loss on disposal of property, plant and equipment A23200 Loss on disposal on investments accounted for using the equity method A23700 (Reversal of) write-down of inventories A23900 Unrealized gain (loss) on the transactions with subsidiaries A29900 Recognition of refund liabilities A30000 Changes in operating assets and liabilities A31115 Financial assets at fair value through profit or loss A31130 Notes receivable A31150 Accounts receivable A31160 Accounts receivable from related parties A31180 Other receivables A31190 Other receivables from related parties A31200 Inventories A31230 Prepayments and other current assets A32150 Accounts payable A32160 Accounts payable from related parties A32180 Other payables A32190 Other payables from related parties A32230 Other current liabilities (Continued on the next page)	2021 $ 2,329,858 167,620 1,752 2 ( 1,254 ) 5,163 ( 1,463 ) ( 19,077 ) ( 282,784 ) 139 ( 153 ) 1,030 ( 2,476 ) 6,944 ( 333,731 ) ( 3,462 ) ( 367,431 ) 2,303 ( 45,282 ) 7,409 ( 442,288 ) ( 3,731 ) ( 154,749 ) ( 470 ) $ 55,929 2,617 33,505	2020
		$ 2,258,413 166,325 2,042 ( 238 ) ( 22,139 ) 10,802 ( 1,755 ) ( 7,555 ) ( 670,387 ) 51 173 ( 326 ) 419 7,576 ( 32,379 ) ( 12,408 ) ( 57,188 ) 64,164 12,465 20,517 ( 25,829 ) ( 4,192 ) 495,078 ( 324 ) $ 99,861 ( 3,881 ) 2,132

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(Continued from the previous page)

Code
A32240
Net defined benefit liabilities

A33000
Cash generated from operations
A33100
Interest received
A33300
Interest paid

A33500
Income tax paid

AAAA
NET
CASH FLOWS FROM
OPERATING ACTIVITIES
CASH
FLOWS
FROM
INVESTING
ACTIVITIES
B02700
Payments for property, plant and
equipment
B03700
Increase in refundable deposits

B04500
Payments for intangible assets

B07600
Dividends received
B09900
Proceeds
from
liquidation
of
investments accounted for using
equity method
BBBB
Net
cash
used
in
investing
activities
CASH
FLOWS
FROM
FINANCING
ACTIVITIES
C00100
Increase in short-term borrowings
C00200
Decrease in short-term borrowings

C01600
Proceeds from long-term borrowings

C01700
Repayments of long-term borrowings

C04020
Repayments of the principal portion of
lease liabilities
C04300
Increase in other non-current liabilities
C04500
Cash dividends

C04400
Refund of unclaimed overdue cash
dividends
C05400
Acquisition of subsidiaries
C09900
Claim for disgorgement

CCCC
Cash used in financing activities

EEEE
NET INCREASE IN CASH AND CASH
EQUIVALENTS
E00100
CASH AND CASH EQUIVALENTS AT
THE BEGINNING OF THE YEAR
E00200
CASH AND CASH EQUIVALENTS AT
THE END OF THE YEAR

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

Notice to Readers:

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TAITA CHEMICAL CO., LTD.

Notes to Financial Statements

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

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

1. GENERAL INFORMATION

Taita Chemical Co., Ltd. (the “Company”) was established and began operations in April 1960. The Company designs, develops, and sells chemical products like EPS, ABS and PS plastic resins. Other products include SAN resins, glasswool and cubic printing, all of which are widely used in consumer-oriented and industrial applications. The ordinary shares of the Company has been listed on the Taiwan Stock Exchange since 1986. The Company’s parent company is USI Corporation, which held indirectly 36.79% of the ordinary shares of the Company as of December 31, 2021. USI Corporation has operational control over the Company.

The functional currency of the Company is the New Taiwan dollar, and the financial statements of the Company are presented in the Company’s functional currency.

2. APPROVAL OF FINANCIAL STATEMENTS

The financial statements were approved by the Company’s board of directors on March 9, 2022.

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

a. 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 FSC.

The initial application of the IFRSs endorsed and issued into effect by the FSC did not have any material impact on the Company’s accounting policies.

b. FSC-endorsed IFRSs that are applicable from 2022 onward

New/Revised/Amended Standards and Interpretations Annual Improvements to IFRSs 2018-2020 Amendments to IFRS 3 "Reference to the Conceptual Framework" Amendments to IAS 16 "Property, Plant and Equipment - Proceeds before Intended Use" Amendments to IAS 37 "Onerous Contracts - Cost of Fulfilling a Contract"	Effective Date of Issuance bythe IASB
	January 1, 2022 January 1, 2022 January 1, 2022 January 1, 2022

Note 1. The amendments to IFRS 9 apply prospectively to modifications and exchanges of financial liabilities that occur on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IAS 41 "Agriculture" apply prospectively to the fair value measurements on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IFRS 1 "First-time Adoptions of IFRSs" apply retrospectively for annual reporting periods beginning on or after January 1, 2022.
Note 2. The amendments apply to the business combination of which the acquisition date falls on the annual reporting periods beginning on or after January 1, 2022.
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Note 3. The amendments apply to property, plant, and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after January 1, 2021.

Note 4. The amendments apply to contracts that will not have been completely fulfilled in the annual period beginning after January 1, 2022.

As of the date of authorization of the financial statements, the Company's assessment of the effects of amendments to other standards and interpretations should not cause material effects on the financial conditions and performance.

c. Standards issued by the IASB but not yet endorsed and issued into effect by the FSC

New/Revised/Amended Standards and Interpretations Amendments to IFRS 10 and IAS 28 "Sale or Contribution of Assets between an Investor and Its Associate or Joint Venture" IFRS 17 “Insurance Contracts” Amendments to IFRS 17 Amendments to IFRS 17 “Initial Application of IFRS 17 and IFRS 9―Comparative Information” Amendments to IAS 1 "Classify Liabilities as Current or Non-current" Amendments to IAS 1 "Disclosure of Accounting Policies" Amendments to IAS 8 "Definition of Accounting Estimates" Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”	Effective Date of Issuance bythe IASB(Note 1)
	To be determined January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 (Note 2) January 1, 2023 (Note 3) January 1, 2023 (Note 4)

New/Revised/Amended Standards and Interpretations
Amendments to IFRS 10 and IAS 28 "Sale or Contribution
of Assets between an Investor and Its Associate or Joint
Venture"
IFRS 17 “Insurance Contracts”
Amendments to IFRS 17
Amendments to IFRS 17 “Initial Application of IFRS 17
and IFRS 9―Comparative Information”
Amendments to IAS 1 "Classify Liabilities as Current or
Non-current"
Amendments to IAS 1 "Disclosure of Accounting Policies"
Amendments to IAS 8 "Definition of Accounting
Estimates"
Amendments to IAS 12 “Deferred Tax related to Assets and
Liabilities arising from a Single Transaction”

Effective Date of Issuance
bythe IASB(Note 1)

To be determined
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2023 (Note 2)
January 1, 2023 (Note 3)
January 1, 2023 (Note 4)

Note 1. Unless otherwise specified, the aforementioned New/Amended/Revised Standards and Interpretations shall be effective for the annual reporting period after the specified dates.
Note 2. The amendments prospectively apply to the annual reporting periods beginning on or after January 1, 2023.
Note 3. The amendments apply to changes in accounting estimates and in accounting policies which take place in the annual reporting periods beginning on or after January 1, 2023.
Note 4. Except for the temporary differences arising from leases and decommissioning obligations on January 1, 2022 are recognized in deferred income tax, the amendment applies to transactions occurring after January 1, 2022.

As of the date of authorization of the financial statements, the Company has continued to assess the effects of amendments to other standards and interpretations on its financial conditions and performance. Related impacts will be disclosed upon completion of the assessment.

4. Summary of Significant Accounting Policies

a. Statement of compliance

The financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

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b. Basis of preparation

The financial statements have been prepared on a historical cost basis, except for financial instruments measured at fair value and net defined benefit liabilities recognized at the present value of defined benefit obligations less fair value of plan assets.

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

1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities on the measurement date.
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. deduced from prices).
3) Level 3 inputs are unobservable inputs for the asset or liability.

When preparing these financial statements, the Company uses the equity method to account for its investments in subsidiaries and associates. In order for the amounts of the net profit for the year, other comprehensive income for the year and total equity in the financial statements to be the same with the amounts attributable to the owners of the Company in its financial statements, adjustments arising from the differences in accounting treatments between the parent company only basis and the consolidated basis were made to investments accounted for using the equity method, the share of profit or loss of subsidiaries and associates, the share of other comprehensive income of subsidiaries and associates and the related equity items, as appropriate, in these financial statements.

c. Classification of current and non-current assets and liabilities

Current assets include:

1) Assets held primarily for the purpose of trading;
2) Assets expected to be realized within 12 months after the reporting period; and
3) Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.

Current liabilities include:

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

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

d. Foreign currencies

In preparing the financial statements of the Company, transactions in currencies other than the Company’s functional currency (i.e., foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions.

At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Exchange differences on monetary items arising from settlement or translation are recognized in profit or loss in the period in which they arise.

Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Exchange

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differences arising from the retranslation of non-monetary items are included in profit or loss for the period except for exchange differences arising from the retranslation of nonmonetary items in respect of which gains and losses are recognized directly in other comprehensive income; in which case, the exchange differences are also recognized directly in other comprehensive income.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

For the purpose of presenting consolidated financial statements, the functional currencies of the Company (including subsidiaries and associates in other countries that use currencies which are different from the currency of the Company) are translated into the presentation currency, the New Taiwan dollar, as follows: Assets and liabilities are translated at the exchange rates prevailing at the end of the reporting period; and income and expense items are translated at the average exchange rates for the period. The resulting currency translation differences are recognized in other comprehensive income.

e. Inventories

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

f. Investments in subsidiaries

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

A subsidiary is an entity that is controlled by the Company.

Under the equity method, an investment in a subsidiary is initially recognized at cost and adjusted thereafter to recognize the Company’s share of the profit or loss and other comprehensive income of the subsidiary. The Company also recognizes the changes in the Company’s share of equity of subsidiaries.

Changes in the Company’s ownership interest in a subsidiary that do not result in the Company losing control of the subsidiary are equity transactions. The Company recognizes directly in equity any difference between the carrying amount of the investment and the fair value of the consideration paid or received.

When the Company’s share of losses of a subsidiary exceeds its interest in that subsidiary (which includes any carrying amount of the investment accounted for using the equity method and long-term interests that, in substance, form part of the Company’s net investment in the subsidiary), the Company continues recognizing its share of further losses.

The Company assesses its investment for any impairment by comparing the carrying amount with the estimated recoverable amount as assessed based on the investee’s financial statements as a whole. Impairment loss is recognized when the carrying amount exceeds the recoverable amount. If the recoverable amount of the investment subsequently increases, the Company recognizes a reversal of the impairment loss; the adjusted postreversal carrying amount should not exceed the carrying amount that would have been recognized (net of amortization or depreciation) had no impairment loss been recognized in prior years.

Profits or losses resulting from downstream transactions are eliminated in full only in the parent company only financial statements. Profits and losses resulting from upstream transactions and transactions between subsidiaries are recognized only in the parent

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company’s financial statements only to the extent of the interests in the subsidiaries that are not related to the Company.

g. Investments in associates

An associate is an entity over which the Company has significant influence and that is not a subsidiary.

The Company uses the equity method to account for its investments in associates.

Under the equity method, investments in an associate are initially recognized at cost and adjusted thereafter to recognize the Company’s share of the profit or loss and other comprehensive income of the associate. The Company also recognizes the changes in the Company’s share of the equity of associates attributable to Company.

When the Company subscribes for additional new shares of an associate at a percentage different from its existing ownership percentage, the resulting carrying amount of the investment differs from the amount of the Company’s proportionate interest in the associate. The Company records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus - changes in capital surplus from investments in associates accounted for using the equity method. If the Company’s ownership interest is reduced due to its additional subscription of the new shares of the associate, the proportionate amount of the gains or losses previously recognized in other comprehensive income in relation to that associate is reclassified to profit or loss on the same basis as would be required if the investee had directly disposed of the related assets or liabilities. When the adjustment should be debited to capital surplus, but the capital surplus recognized from investments accounted for using the equity method is insufficient, the shortage is debited to retained earnings.

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

The entire carrying amount of an investment is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is not allocated to any asset, including goodwill, that forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increases.

The Company shall cease the use of equity method from the date when its investment is no longer an associate or a joint venture. Its retained interest in the associate and the joint venture is measured at fair value, and the difference between the fair value and the carrying amount of the investment and the carrying amount of the investment at the date of acquisition of the equity method is included in profit or loss for the current period.

The Company shall cease the use of equity method from the date when its investment is no longer an associate. Its retained interest in the associate is measured at fair value, and the difference between the fair value and the carrying amount of the investment and the carrying amount of the investment at the date of acquisition of the equity method is included in profit or loss for the current period.

When a Company entity transacts with its associate, profits and losses resulting from the transactions with the associate are recognized in the Company’s financial statements only to the extent that the interests in the associate are not related to the Company.

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h. Property, plant and equipment

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

Property, plant and equipment in the course of construction are measured at cost less any recognized impairment loss. Cost includes professional fees and borrowing costs eligible for capitalization. Such assets are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for their intended use.

Except for freehold land, depreciation of property, plant and equipment is recognized using the straight-line method. Each significant part is depreciated separately. The estimated useful lives, residual values and depreciation methods are reviewed at the end of each reporting period, with the effects of any changes in the estimates accounted for on a prospective basis.

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

i. Investment properties

Investment properties are properties held to earn rentals and/or for capital appreciation. Investment properties also include land held for a currently undetermined future use.

Investment properties are initially measured at cost and include transaction costs for land. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and accumulated impairment loss.

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

j. Intangible assets

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

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

k. Impairment of property, plant, and equipment as well as right-of-use assets, investment property, and intangible assets

At the end of each reporting period, the Company reviews the carrying amounts of its property, plant, and equipment as well as right-of-use assets, investment property and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Corporate assets are allocated to the smallest group of cash-generating units on a reasonable and consistent basis of allocation.

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

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

l. Financial instruments

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

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to an acquisition or issuance of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

1) Financial assets

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

a) Measurement categories

Financial assets are classified into the following categories: Financial assets at FVTPL, financial assets at amortized cost and equity instruments at FVTOCI.

i. Financial assets at FVTPL

Financial asset is classified as at FVTPL when such a financial asset is mandatorily classified. Financial assets mandatorily classified as at FVTPL include investments in equity instruments which are not designated as at FVTOCI and derivatives and mutual fund that do not meet the amortized cost criteria or the FVTOCI criteria.

Financial assets at fair value through profit or loss are measured at fair value. Dividends and interest accrued are recognized in other income and interest income respectively, and profits or losses accrued from remeasurement are recognized in other gains and losses. Fair value is determined in the manner described in Note 28.

ii. Financial assets at amortized cost

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

i) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
ii) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, notes receivable, accounts receivable, other receivables, pledged financial assets and refundable deposits, are measured at amortized cost, which equals the gross carrying amount determined using the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

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

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

A credit-impaired financial asset refers to the situation where the issuer or debtor has experienced significant financial difficulties or defaults and therefore the debtor is likely to file for bankruptcy or declare financial restructuring, or the disappearance of an active market for that financial asset due to financial difficulties has occurred.

Cash equivalents include highly liquid time deposits and reverse repurchase agreements collateralized by bonds that can be readily converted into fixed amount of cash with limited risk of change in value. Cash equivalents are held to meet short-term cash commitments.

iii. Investments in equity instruments at FVTOCI

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

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

Dividends on these investments in equity instruments are recognized in profit or loss when the Company’s right to receive the dividends is established, unless the dividends clearly represent a recovery of part of the cost of the investment.

b) Impairment of financial assets

The Company recognizes a loss allowance for expected credit losses on financial assets at amortized cost (including accounts receivable).

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

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

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portion of lifetime ECLs that is expected to result from default events on a financial instrument that are possible within 12 months after the reporting date.

For internal credit risk management purpose, if any internal or external information shows that the debtor is unlikely to pay its creditors, the Company will determine that a financial asset is in default (without taking into account any collateral held by the Company).

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

c) Derecognition of financial assets

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

On derecognition of a financial asset at amortized cost in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss. On derecognition of an investment in an equity instrument at FVTOCI, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss, and the cumulative gain or loss which had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through profit or loss.

2) Financial liabilities
a) Subsequent measurement

Except the financial liabilities at fair value through profit or loss, all the financial liabilities are measured at amortized cost using the effective interest method.

Financial liabilities at fair value through profit or loss are stated at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. Fair value is determined in the manner described in Note 28.

b) Derecognition of financial liabilities

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

3) Derivative instruments

The Company enters into a variety of derivative instruments to manage its exposure to foreign exchange rate risks, including foreign exchange forward contracts.

Derivatives are initially recognized at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately. When the fair value of a derivative financial instrument is positive, the derivative is recognized as a financial asset; when the fair value of a derivative financial instrument is negative, the derivative is recognized as a financial liability.

m. Revenue recognition

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

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Revenue from sale of goods

Revenue from the sale of goods comes from sales of PS, ABS, SAN, glasswool products, plastic raw materials and the related processed products. The sale of goods above is recognized as revenue when goods are delivered to a customer because it is the time when the customer has full discretion over the manner of distribution and the price to sell the goods, has the primary responsibility for sales to future customers and bears the risks of obsolescence. Accounts receivable are recognized concurrently.

n. Leases

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

1) The Company as lessor

Leases are classified as finance leases whenever the terms of a lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Lease payments (less any lease incentives payable) from operating leases are recognized as income on a straight-line basis over the terms of the relevant leases. Initial direct costs incurred in obtaining operating leases are added to the carrying amounts of the underlying assets and recognized as expenses on a straight-line basis over the lease terms.

2) The Company as lessee

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

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

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

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

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in future lease payments resulting from a change in a lease term, the Company remeasures the lease liabilities with a corresponding adjustment to the right-of-useassets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. Lease liabilities are presented on a separate line in the balance sheets.

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o. Borrowing costs

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

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

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

p. Employee benefits
1) Short-term employee benefits

Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related services.

2) Retirement benefits

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

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

Net defined benefit liabilities represent the actual deficit in the Company’s defined benefit plans.

q. Income tax

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

1) Current tax

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

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

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

2) Deferred tax

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

Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences

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and unused loss carryforwards to the extent that it is probable that taxable profit will be available against which those deductible temporary differences can be utilized.

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

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the assets to be recovered. A previously unrecognized deferred tax asset is also reviewed at the end of each reporting period and recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

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

3) Current and deferred taxes

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

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

The Company takes into account recent development of COVID-19 pandemic in Taiwan and its potential impacts on the economy, including cash flow projections, growth rates, discount rates, profitability, etc. in Company 's critical accounting estimates and the management will continue to review the estimates and underlying assumptions. Revisions to accounting estimates are recognized in the period in which the estimates are revised if the revisions affect only that period or in the period of the revisions and future periods if the revisions affect both current and future periods.

Key Sources of Estimation Uncertainty

a. Estimated impairment of financial accounts receivable

The provision for impairment of accounts receivable is based on assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and in selecting the inputs to the impairment calculation, based on the Company’s historical

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experience, existing market conditions as well as forward looking estimates as of the end of each reporting period. For details of the key assumptions and inputs used, see Note 10. Where the actual future cash inflows are less than expected, a material impairment loss may arise.

b. Write-down of inventories

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

c. Estimation of damage compensation for associate’s gas explosion incidents

The Company’s associate, China General Terminal & Distribution Corporation (hereinafter “CGTD”), recognized a provision for civil damages due to gas explosion. The management considered the progress of the relevant civil and criminal procedures, settlements achieved, and legal advice to estimate the amount of the provision. However, the actual amount might differ from the current estimation.

6. CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS
Cash on hand and petty cash Checking accounts and demand deposits Cash equivalents Time deposits	December31,2021 $ 441 120,722 304,712 $ 425,875	December31,2020
			$ 1,041 60,846 303,882 $ 365,769

The market rate or interval of market rates of cash equivalents at the end of the reporting period were as follows:

7.	Time deposits FINANCIAL INSTRUMENTS AT FAIR	December31,2021 December31,2020 0.08%~0.77% 0.10%~0.18% VALUE THROUGH PROFIT OR LOSS	December31,2020	December31,2020
	(FVTPL) Financial assets mandatorily classified as at FVTPL Derivative financial liabilities (not under hedge accounting) －Foreign exchange forward contracts Non-derivative financial assets －Domestic listed shares －Mutual funds －Beneficiary securities Subtotal Financial liabilities held for trading Derivative financial liabilities (not under hedge accounting) －Foreign exchange forward contracts	December31,2021 $ 1,037 73,438 562,034 59,466 694,938 $695,975 $ -	December31,2020
				$ 431 - 300,185 60,808 360,993 $361,424 $ 434

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At the end of the reporting period, outstanding foreign exchange forward contracts not under hedge accounting were as follows:

December 31, 2021 Sell December 31, 2020 Sell	Currency USD/NTD USD/NTD	MaturityDate 2022.01. 13- 2022.03.21 2021.01. 18- 2021.02.22	Notional Amount(In Thousands)
			USD 7,340 /TWD 204,227 USD 6,000 /TWD 170,073

The Company entered into foreign exchange forward contracts to manage exposures to exchange rate fluctuations of foreign currency denominated assets and liabilities. As these contracts did not meet the criteria of hedge accounting, and therefore, the Company did not apply hedge accounting treatments for these derivative contracts.

The net gain arising from financial assets at FVTPL for the years ended December 31, 2021 and 2020 was $8,818 thousand and $27,750 thousand, respectively. The net loss arising from financial liabilities at FVTPL for the years ended December 31, 2021 and 2020 was $2,499 thousand and $4,299 thousand, respectively.

8. Financial assets at FVTOCI - non-current

Investments in equity instruments Domestic investments Listed ordinary shares - USI Corporation Unlisted ordinary shares - Harbinger Venture Capital Corp. (“HARBINGER”)	December31,2021 $476,718 7 $ 476,725	December31,2020	December31,2020
			$ 341,484 7 $ 341,491

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

－ 9. FINANCIAL ASSETS AT AMORTIZED COST CURRENT

Pledged time deposits	December31,2021 $ 3,000	December31,2020	December31,2020
			$ 3,000

As of December 31, 2021 and 2020, the market interest rate of pledged deposits were both 0.37% to 0.69% per annum.

Refer to Note 30 for information related to the pledged financial assets at amortized cost.

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10.	Notes Receivable, Accounts Receivable, and	Other Receivables December31,2021 $ 44,729 $ 1,841,717 ( 53,733) $ 1,787,984 $ 542 $ 88,943 5,074 $ 94,017 $ 259,271	December31,2020	December31,2020
	Notes receivable (a) Notes receivable - operating Accounts receivable (a) Amortized cost Gross carrying amount Less: Allowance for impairment loss Accounts receivable from related parties (a) (Note 29) Other receivables (b) VAT refund receivables Others Other receivables from related parties (Note 29)
		(	(	$ 41,267 $ 1,481,212 53,731) $ 1,427,481 $ 2,845 $ 48,661 71 $ 48,732 $ 266,680

a. Notes receivable and accounts receivable

The average credit period of sales of goods is 30-180 days. No interest is charged on receivables. In order to minimize credit risk, the management of the Company has delegated a team responsible for determining credit limits, credit approvals and other monitoring procedures to ensure that follow-up action is taken to recover overdue debts. For part of the accounts receivable, the Company entered into a credit insurance contract or obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. In addition, the Company reviews the recoverable amount of each individual trade debt at the end of the reporting period to ensure that adequate allowance is made for possible irrecoverable amounts. Before accepting new customers, the Company takes customer evaluation results generated by the internal system into consideration to measure the potential customer’s credit quality and define the customer’s credit limit. Customer credit limits and ratings are reviewed periodically. In this regard, the management believes the Company’s credit risk was significantly reduced.

The Company measures the loss allowance for accounts receivable at an amount equal to lifetime ECLs. The expected credit losses on trade receivables are estimated using a provision matrix by reference to the past default experience of the debtor and an analysis of the debtor’s current financial position, adjusted for general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of economic conditions at the reporting date.

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

The following table details the loss allowance of accounts receivable based on the Company ’s provision matrix.

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December 31, 2021

December 31, 2021
Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost December 31, 2020 Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost	Credit Rating A $ 2,148 - $ 2,148 Credit Rating A $ - - $ -	Credit Rating B $ 186,333 - $ 186,333 Credit Rating B $ 178,495 - $ 178,495	Credit Rating C $ 76,787 ( 220) $ 76,567 Credit Rating C $ 122,001 - $ 122,001		Others $ 1,621,720 53,513) $ 1,568,207 Others $ 1,224,828 53,731) $ 1,171,097		Total
				(		(	$ 1,886,988 53,733) $ 1,833,255 Total
				(		(	$ 1,525,324 53,731) $ 1,471,593

The movements of the loss allowance of accounts receivable were as For the Year Ended December 31,2021 Balance at January 1 $ 53,731 Net remeasurement of loss allowance (reversal) 2 Balance at December 31 $ 53,733 The aging of receivables (including related parties) was as follows: December31,2021 Not Past Due $ 1,788,022 Past due within 60 days 45,448 Past due over 60 days 53,518 Total $ 1,886,988	follows: For the Year Ended December 31,2020	follows: For the Year Ended December 31,2020
	$ 53,969 ( 238) $ 53,731 December31,2020
		$ 1,448,686 23,121 53,517 $ 1,525,324

The above aging schedule was based on the number of days past due from the end of the credit term.

As of December 31, 2021 and 2020, except for specific customer’s accounts receivable exceeded 22% of the total amount of all receivables, none of other customer’s receivables exceeded 10% of the total amount of all receivables. The concentration of credit risk is limited because the Company’s customer base is vast and unrelated to each other.

b. Other receivables

As of December 31, 2021 and 2020, the Company assessed the impairment loss of other receivables using expected credit losses.

11. Inventories

Inventories
Finished goods Work in process Raw materials Production supplies Inventory in transit	December31,2021 $ 267,199 105,084 370,705 20,758 179,660 $ 943,406	December31,2020
			$ 207,255 62,258 139,362 15,815 147,548 $ 572,238

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The cost of inventories recognized as cost of goods sold for the years ended December 31, 2021 and 2020 was $12,656,293 thousand and $8,789,022 thousand, respectively.

The cost of goods sold included write-down of $1,030 thousand and reversal of inventory writedown of $326 thousand, which resulted from inventory closeout, for the years ended December 31, 2021 and 2020, respectively.

	The cost of goods sold included write-down of $1,030 thousand and reversal of inventory write- down of $326 thousand, which resulted from inventory closeout, for the years ended December 31, 2021 and 2020, respectively.	The cost of goods sold included write-down of $1,030 thousand and reversal of inventory write- down of $326 thousand, which resulted from inventory closeout, for the years ended December 31, 2021 and 2020, respectively.	The cost of goods sold included write-down of $1,030 thousand and reversal of inventory write- down of $326 thousand, which resulted from inventory closeout, for the years ended December 31, 2021 and 2020, respectively.
12.	INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD December31,2021 December31,2020 Investments in subsidiaries $ 3,142,621 $ 2,951,653 Investments in associates 627,405 539,545 $ 3,770,026 $ 3,491,198
	Investments in subsidiaries Investments in associates	December31,2021 $ 3,142,621 627,405 $ 3,770,026
			$ 2,951,653 539,545 $ 3,491,198

a. Investments in subsidiaries

Investments in subsidiaries
Unlisted company TAITA (BVI) Holding Co., Ltd.(TAITA (BVI)) Investor Company Name of Subsidiary The Company TAITA (BVI)	December31,2021 December31,2020 $ 3,142,621 $ 2,951,653 Proportion of Ownership Nature of Activities December 31, 2021 December 31, 2020 Reinvestment 100% 100%		December31,2020
		December 31, 2021 100%		December 31, 2020
				100%

Through TAITA (BVI), the Company indirectly invested in Taita Chemical (Tianjin) Co., Ltd. (“TAITA (TJ)”). The management stopped the production of TAITA (TJ) in April 2019 as a result of the reduction in demand of EPS, which is the main product of TAITA (TJ) in the local market. TAITA (TJ) determined the recoverable amount of the property, plant and equipment, including right-of-use assets, on the basis of their fair values less costs of disposal. The review led TAITA (TJ) to recognize an impairment loss of $39 thousand and $22,078 thousand, which was recognized in the share of profit or loss of subsidiaries for the year ended December 31, 2021 and 2020, respectively.

In order to strengthen the operational capital of TAITA (BVI) and improve its financial structure, on November 3, 2020, the Board of Directors of the Company resolved to increase the Company's investment in TAITA (BVI) by US$28,000 thousand in cash, and as of December 31, 2021, the Company's accumulated investment in TAITA (BVI) amounted to US$89,738 thousand.

On December 3, 2020, the Board of Directors of the Company resolved to establish Zhangzhou Taita Chemical Company Ltd. (TTC (ZZ)) with a capital contribution of RMB314,000 thousand from TAITA (BVI). The main business of TTC (ZZ) is the production and sale of EPS. The establishment of TTC (ZZ) was registered on June 28, 2021 and TAITA (BVI) injected RMB306,950 thousand into TTC (ZZ) on March 8, 2022.

The investments in subsidiaries accounted for by the equity method and the share of profit or loss and other comprehensive income of those investments for the years ended December 31, 2021 and 2020 were based on the subsidiaries’ financial statements audited by auditors for the same years.

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b. Investments in associates

December 31, 2021 December 31, 2020 Associates that are not individually material Listed company China General Plastics Corporation (“CGPC”) $ 221,245 $ 192,320 Acme Electronics Corporation (“ACME”) 32,429 31,514 Unlisted company China General Terminal & Distribution Corporation (“CGTD”) 373,731 315,711 $ 627,405 $ 539,545

Aggregate information of associates that are not individually material For the Year Ended December31,2021 For the Year Ended December31,2020 The Company’s share of: Profit from continuing operations $ 71,499 $ 56,330 Other comprehensive gain (loss) 36,070 36,898 Total comprehensive (loss) income for the year $ 107,569 $ 93,228	Aggregate information of associates that are not individually material For the Year Ended December31,2021 For the Year Ended December31,2020 The Company’s share of: Profit from continuing operations $ 71,499 $ 56,330 Other comprehensive gain (loss) 36,070 36,898 Total comprehensive (loss) income for the year $ 107,569 $ 93,228	Aggregate information of associates that are not individually material For the Year Ended December31,2021 For the Year Ended December31,2020 The Company’s share of: Profit from continuing operations $ 71,499 $ 56,330 Other comprehensive gain (loss) 36,070 36,898 Total comprehensive (loss) income for the year $ 107,569 $ 93,228	Aggregate information of associates that are not individually material For the Year Ended December31,2021 For the Year Ended December31,2020 The Company’s share of: Profit from continuing operations $ 71,499 $ 56,330 Other comprehensive gain (loss) 36,070 36,898 Total comprehensive (loss) income for the year $ 107,569 $ 93,228
The Company’s share of: Profit from continuing operations Other comprehensive gain (loss) Total comprehensive (loss) income for the year	For the Year Ended December31,2021 $ 71,499 36,070 $ 107,569
			$ 56,330 36,898 $ 93,228

The Company’s ownership interest and percentage of voting right in associate at the end of the reporting period were as follows:

of the reporting period were as follows:
Name of Associates CGPC ACME CGTD	December31,2021 1.98% 2.43% 33.33%	December31,2020
		1.98% 2.43% 33.33%

Refer to Table 6 “Information on Investees” for the nature of activities, principal places of business and countries of incorporation of the associates.

The Company with its affiliates jointly held more than 20% of the shareholdings of CGPC and ACME, and had significant influence over each entity. Therefore, the Company adopted the equity method to evaluate the above investments.

The Company formerly held 10% of shares of Thintec Materials Corporation (“TMC”) Since the Company and its affiliates jointly owned 95.8% of TMC’s shares, the Company adopted the equity method to evaluate the above investments. As TMC essentially has no production and sales business in recent years, the Board of Directors of TMC resolved on April 12, 2019 to conduct dissolution and liquidation starting from May 25, 2019 (dissolution date). The Company has recovered $1,274 thousand in May 2020 from the remaining property and recognized the investment disposal loss of of $173 thousand after TMC has completed dissolution and liquidation procedures in July, 2020. In February 2021, TMC received a refund of tax from the Taipei Bureau of Internal Revenue, Ministry of Finance, and in April 2021, the Company recovered $153 thousand in proportion to its shareholding before liquidation and recognized it as other income.

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Fair values (Level 1) of investments in associates with available published price quotations are summarized as follows:

are summarized as follows:
Name of Associates CGPC ACME	December31,2021 $ 399,611 $ 237,809	December31,2020
			$ 279,130 $ 84,011

The investments above were accounted for using the equity method.

Except ACME’s financial statements for the year ended December 31, 2021 were not audited by CPAs, the share of profit or loss of associates using the equity method and other comprehensive income were recognized based on associates’ financial statements audited by CPAs in the same period. However, the Company's management considered that there was no material impact arising from ACME's unaudited financial statements.

13. Property, plant and equipment

Cost Balance at January 1, 2020 Additions Disposals Internal transfers Balance at December 31, 2020 Accumulated depreciation Balance at January 1, 2020 Disposals Depreciation expenses Balance at December 31, 2020 Carrying amounts at December 31, 2020 Cost Balance at January 1, 2021 Additions Disposals Internal transfers Balance at December 31, 2021 Accumulated depreciation Balance at January 1, 2021 Disposals Depreciation expenses Balance at December 31, 2021 Carrying amounts at December 31, 2021		Freehold Land		Buildings	Machinery and Equipment	Machinery and Equipment	Transportation Equipment $ 24,754 - ( 96 ) 96 $ 24,754 $ 23,479 ( 96 ) 413 $ 23,796 $ 958 $ 24,754 - ( 700 ) 141 $ 24,195 $ 23,796 ( 700 ) 436 $ 23,532 $ 663	Transportation Equipment $ 24,754 - ( 96 ) 96 $ 24,754 $ 23,479 ( 96 ) 413 $ 23,796 $ 958 $ 24,754 - ( 700 ) 141 $ 24,195 $ 23,796 ( 700 ) 436 $ 23,532 $ 663		Other Equipment		Construction in Progress		Total
		$ 634,432 - - - $ 634,432 $ - - - $ - $ 634,432 $ 634,432 - - - $ 634,432 $ - - - $ - $ 634,432	( ( ( (	$ 865,080 - 423 ) 1,817 $ 866,474 $ 614,864 392 ) 22,819 $ 637,291 $ 229,183 $ 866,474 - 2,456 ) 6,012 $ 870,030 $ 637,291 2,317 ) 21,893 $ 656,867 $ 213,163	( ( ( (	$ 3,773,449 - 13,391 ) 54,645 $ 3,814,703 $ 2,858,061 13,391 ) 131,231 $ 2,975,901 $ 838,802 $ 3,814,703 - 34,217 ) 103,926 $ 3,884,412 $ 2,975,901 34,217 ) 135,435 $ 3,077,119 $ 807,293		$ 24,754 - 96 ) 96 $ 24,754 $ 23,479 96 ) 413 $ 23,796 $ 958 $ 24,754 - 700 ) 141 $ 24,195 $ 23,796 700 ) 436 $ 23,532 $ 663	( ( ( (	$ 298,577 - 1,298 ) 6,112 $ 303,391 $ 281,430 1,278 ) 7,243 $ 287,395 $ 15,996 $ 303,391 - 2,547 ) 10,417 $ 311,261 $ 287,395 2,547 ) 5,236 $ 290,084 $ 21,177	( (	$ 18,481 101,885 - 62,670) $ 57,696 $ - - - $ - $ 57,696 $ 57,696 97,060 - 120,496) $ 34,260 $ - - - $ - $ 34,260	( ( ( (	$ 5,614,773 101,885 15,208 ) - $ 5,701,450 $ 3,777,834 15,157 ) 161,706 $ 3,924,383 $ 1,777,067 $ 5,701,450 97,060 39,920 ) - $ 5,758,590 $ 3,924,383 39,781 ) 163,000 $ 4,047,602 $ 1,710,988

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

Buildings
Factories	20, 30, 35, 40 and 55 years
Offices and laboratories	26-35 Years
Storage rooms	20-25 Years
Storage tank rooms	8-20 Years
Others	2-9 Years
Machinery and equipment
Environmental protection equipment	15-20 Years
Monitoring equipment	11-15 Years
Storage tank and pipeline systems	10-15 Years
Production and packaging equipment	8-15 Years
Power systems	7-15 Years
Others	2-8 Years
Transportation equipment	5-15 Years
Other equipment	2-15 Years

Part of the property, plant and equipment pledged as collateral for bank borrowing are set out in Notes 17 and 30.

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14. LEASE ARRANGEMENTS

a. Right-of-use assets

Right-of-use assets
Carrying amounts Land Depreciation charge for right-of-use assets Land	December31,2021 $ 41,574 For the Year Ended December31,2021 $ 4,620	December31,2020
		$ 46,194 For the Year Ended December31,2020
			$ 4,619

Except for the recognition of depreciation expenses, there was no significant increase, sublease or impairment of the Company’s right-of-use assets for the years ended December 31, 2021 and 2020.

b. Lease liabilities

Lease liabilities
December31,2021 Carrying amounts Current $ 4,564 Non-current $ 38,374 The discount rate for lease liabilities was as follows: December31,2021 Land 1.10%	December31,2020
	$ 4,514 $ 42,938 December31,2020
	1.10%

The Company leases land in Linyuan to build factories from related party. When rental period ends, the Company has no bargain purchase price option for the land leased. Transactions with related parties are set out in Note 29.

c. Other lease information

Lease arrangements under operating leases for the leasing out of investment properties and freehold property, plant and equipment are set out in Note 15.

Expenses relating to short-term leases Total cash outflow for leases	For the Year Ended December31,2021 $ 12,159 $ 17,172	For the Year Ended December31,2020	For the Year Ended December31,2020
			$ 12,626 $ 17,639

The Company leases certain office equipment, machinery equipment, transportation equipment which qualify as short-term leases and certain other equipment which qualify as low-value asset leases. The Company has elected to apply the recognition exemption and thus, did not recognize right-of-use assets and lease liabilities for these leases.

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15. INVESTMENT PROPERTIES, NET

INVESTMENT PROPERTIES, NET
Land	December31,2021 $ 108,178	December31,2020
			$ 108,178

Management was unable to reliably measure the fair value of investment properties located in Qianzhen District, Xingbang Section and Linyuan Industrial Park, because the fair value for comparable properties is inactive and alternative reliable measurements of fair value are not available. Therefore, the Company concluded that the fair value of the investment properties is not reliably measurable.

The property located in Qianzhan District has been leased to CGTD. The rental was $1,628 thousand per month, which is based on the actual usable area. Refer to Notes 24 and 29.

Part of above investment properties pledged as collateral for bank borrowing are set out in Notes 17 and 30.

16. INTANGIBLE ASSETS

INTANGIBLE ASSETS
Carrying amount by function Information systems Design expenses for factories	December31,2021 $ 493 3,601 $ 4,094	December31,2020
			$ 205 5,201 $ 5,406

Intangible assets are amortized on a straight-line over their estimated useful lives as follows: Information systems 3-5 Years Design expenses for factories 10 years

17. BORROWINGS

a. Short-term borrowings

Short-term borrowings
Unsecured borrowings Line of credit borrowings	December31,2021 $ 350,000	December31,2020
			$ 150,000

The range of interest rates on line of credit borrowings was 0.52%-0.74% and 0.52% per annum as of December 31, 2021 and 2020, respectively.

b. Long-term borrowings

Long-term borrowings
December31,2021 Unsecured borrowings Credit loans $ 300,000 The range of interest rates on long-term borrowings were as follows: December31,2021 Credit loans 0.81%	December31,2020
	$ 300,000 December31,2020
	0.90%

The range of interest rates on long-term borrowings were as follows:

In order to fund medium to long-term working capital needs, the Company signed medium to long-term loan agreements with banks with total lines of credit of $2,000,000 thousand. The loan agreements will subsequently expire before August 2024 and these lines of credit are used cyclically during the validity period. As of December 31, 2021, $300,000 thousand

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has been utilized. As of December 31, 2020, the Company provided lands and factories pledged as collateral for some medium to long-term loan agreements (refer to Notes 13, 15 and 30).

Some of the Company's loan agreements stipulate that the current ratio and debt ratio as stated on the financial statements shall not be less than a specified percentage, and that if such a percentage fails to be met, the Company shall propose improvement measures to the banks concerned. As of December 31, 2021, the Company did not violate these financial ratios and terms.

18. ACCOUNTS PAYABLE

December 31, 2021 December 31, 2020 Accounts payable (including related parties) Arising from operation (Note 29) $ 947,257 $ 1,102,476

The average payment period for the Company’s accounts payable is between 30 and 45 days. The Company has financial risk management policies in place to ensure that all payables are paid within the pre-agreed credit terms.

19. OTHER PAYABLES

OTHER PAYABLES
Payables for salaries or bonuses Payables for freight fees Payables for utilities Payables for equipment Payables for professional service expenses Payables for insurance Payables for taxes Others	December31,2021 $ 204,388 106,038 27,334 9,605 9,373 8,922 1,707 20,082 $ 387,449	December31,2020
			$ 199,752 56,177 25,581 9,955 11,079 8,471 1,764 18,600 $ 331,379

20. REFUND PROVISIONS

Customer returns and rebates Balance at January 1 Provision for the current period Returns and rebates for the current period Balance at December 31	December31,2021 $ 897 For the Year Ended December31,2021 $ 879 6,944 ( 6,926) $ 897	December31,2020	December31,2020
		$ 879 For the Year Ended December31,2020
	(	(	$ 909 7,576 7,606) $ 879

The refund provision is based on management’s judgments and other known reasons for which estimated product returns and rebates may occur for the year ended. The provision is recognized as a reduction of operating income in the periods in which the related goods are sold.

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21. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

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

b. Defined benefit plans

The defined benefit plan adopted by the Company in accordance with the Labor Standards Law is operated by the government of the ROC. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the 6 months before retirement. Since November 1986, the Company contributed a specific rate (currently 12%) of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the Company has no right to influence the investment policy and strategy.

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

plans were as follows:
		December31,2021		December31,2020
Present Value of Defined Benefit
Obligation		$ 543,761			$ 593,645
Fair Value of Plan Assets		(357,342)			(391,849)
Net defined benefit liabilities		$ 186,419			$ 201,796
Movements in net defined benefit liabilities were as follows:
	Present Value
		of Defined			Net defined
		Benefit	Fair	Value of		benefit
		Obligation	Plan Assets			liabilities
Balance at January 1, 2020		$ 632,201	($ 402,287)			$ 229,914
Service cost
Current service cost		4,609		-		4,609
Net interest expense (income)		3,826	(	2,461)		1,365
Recognized in profit or loss		8,435	(	2,461)		5,974
Remeasurement
Return on plan assets (excluding
amounts included in net interest)		-	(	14,814 )	(	14,814 )
Actuarial loss
－Changes in financial
assumptions		10,288		-		10,288
－Experience adjustments		6,026		-		6,026
Recognized in other comprehensive
income		16,314	(	14,814)		1,500
Contributions from the employer		-	(	35,592 )	(	35,592 )
Benefits paid on plan assets	(	63,305)		63,305		-
Balance at December 31, 2020		$ 593,645	($ 391,849)			$ 201,796

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Balance at January 1, 2021		$ 593,645	($ 391,849)	($ 391,849)		$ 201,796
Service cost
Current service cost		3,949		-		3,949
Net interest expense (income)		2,184	(	1,476)		708
Recognized in profit or loss		6,133	(	1,476)		4,657
Remeasurement
Return on plan assets (excluding
amounts included in net interest)		-	(	5,646 )	(	5,646 )
Actuarial loss
－Changes in demographic
assumptions		12,124		-		12,124
－Changes in financial
assumptions	(	4,379 )		-	(	4,379 )
－Experience adjustments		8,787		-		8,787
Recognized in other comprehensive
income		16,532	(	5,646)		10,886
Contributions from the employer		-	(	29,142 )	(	29,142 )
Benefits paid on plan assets	(	70,771 )		70,771		-
Provisions	(	1,778)		-	(	1,778)
Balance at December 31, 2021		$ 543,761	($ 357,342)			$ 186,419

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

benefit plans is as follows:
Cost of goods sold Selling and marketing expenses General and administrative expenses Research and development expenses	For the Year Ended December31,2021 $ 3,925 261 346 125 $ 4,657	For the Year Ended December31,2020
			$ 4,841 461 495 177 $ 5,974

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

1) Investment risk: The plan assets are invested in domestic or foreign equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate of a 2-year time deposit with local banks.
2) Interest risk: A decrease in government bond interest rates will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plans’ debt investments.
3) Salary risk: The present value of the defined benefit obligation is calculated with reference to the future salaries of plan participants. As such, an increase in the salaries of the plan participants will increase the present value of the defined benefit obligation.
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The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations were as follows:

actuarial valuations were as follows:
Discount rate Expected rate of salary increase	December31,2021 0.500% 2.250%	December31,2020
		0.375% 2.250%

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

Discount rate 0.25% increase 0.25% decrease Expected rate of salary increase 0.25% increase 0.25% decrease	December 31,2021 ($ 8,781) $ 9,027 $ 8,718 ($ 8,526)	December 31,2020	December 31,2020
	( (	( (	$ 10,289) $ 10,585 $ 10,208 $ 9,975)

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

The Company expects to make contributions of $20,000 thousand and $25,900 thousand to the defined benefit plans in the next year starting from December 31, 2021 and 2020, respectively. The weighted average duration of the defined benefit obligation are 6.6 and 7.1 years, respectively.

22. EQUITY

a. Ordinary shares

Ordinary shares
Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued	December31,2021 400,000 $ 4,000,000 378,654 $ 3,786,541	December31,2020
			400,000 $ 4,000,000 344,231 $ 3,442,310

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

b. Capital surplus

Capital surplus which arises from the consideration received from issuance of shares (including consideration from issuance of ordinary shares) and donations may be used to offset a deficit, in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Company’s capital surplus and once a year).

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Capital surplus arising from unpaid dividends due to overdue may be used to offset a deficit only. Capital surplus arising from investments in subsidiaries and associates accounted for using the equity method may not be used for any purpose.

c. Retained earnings and dividends policy

Under the dividends policy as set forth in the amended Articles, where the Company made profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as a legal reserve 10% of the remaining profit, setting aside or reversing a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan, which should be resolved in the shareholders’ meeting for the distribution of dividends and bonuses to shareholders. For the policies on the distribution of employees’ compensation and remuneration of directors after the amendment, refer to employees’ compensation and remuneration of directors in Note 24-h.

According to the provisions of the Company’s Articles, the Company in order to take R&D needs and diversification of operations into consideration, dividends shall not be less than 10% of the distributable earnings in the current year, of which the cash dividends shall not be less than 10% of the total dividends. However, if the distributable retained earnings per share of the current year are less than $0.1, the retained earnings are not to be distributed.

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

Items referred to under Rule No. 1090150022 issued by the FSC and the directive titled “Questions and Answers for Special Reserves Appropriated Following Adoption of IFRSs” should be appropriated to or reversed from a special reserve by the Company.

The appropriations of earnings for 2020 and 2019 approved in the shareholders’ meetings on July 26, 2021 and June 18, 2020, respectively, were as follows:

Legal reserve Cash dividends Share dividends	Appropriationof Earnings For the Year Ended December 31, 2020 For the Year Ended December 31, 2019 $ 191,925 $ 39,764 688,462 100,261 344,231 100,262	DividendsPerShare (NT$)	DividendsPerShare (NT$)
	For the Year Ended December 31, 2020 $ 191,925 688,462 344,231	For the Year Ended December 31,2020 $ 2.0 1.0	For the Year Ended December 31,2019
			$ 0.3 0.3

The appropriation of earnings for 2021 had been proposed by the Company’s board of directors on March 9, 2022 were as follows:

Legal reserve Cash dividends Share dividends	Appropriation of Earnings $ 184,098 757,308 189,327	Dividends Per Share (NT$)
		$ - 2.0 0.5

The appropriation of earnings for 2021 is subject to resolution in the shareholders’ meeting to be held on May 27, 2022.

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d. Special reserve

The Company reserved a special reserve on the first-time adoption of IFRSs as follows:

Special reserve

December31,2021 $ 308,061	December31,2020	December31,2020
		$ 308,061

The Company’s amount of unrealized revaluation gain and cumulative adjustments transferred into retained earnings were $279,270 thousand and $160,233 thousand, respectively. The increase in retained earnings arising from the first-time adoption of IFRSs was not sufficient for the special reserve appropriation; thus, the Company appropriated a special reserve in the amount of $308,061 thousand which was the net increase of retained earnings arising from the first-time adoption of IFRSs. As of December 31, 2021, there was no change in the special reserve.

e. Other equity items

1) Exchange differences on translating the financial statements of foreign operations

Exchange differences on translating the financial statements of foreign operations	oreign operations	oreign operations
For the Year Ended December31,2021 For the Year Ended December31,2020 Balance at January 1 ( $ 125,641 ) ( $ 194,326 ) Recognized for the year Exchange differences on translating the financial statements of foreign operations ( 22,793 ) 85,738 Share from associates accounted for using the equity method ( 657 ) 95 Related income tax 4,559 (17,148) Balance at December 31 ($ 144,532) ($ 125,641) Exchange differences on translating net assets of foreign operations are translated into the presentation currency, the New Taiwan dollar. The resulting currency translation differences are recognized in other comprehensive income as exchange differences on translating the financial statements of foreign operations in the respective period. Unrealized gain (loss) on financial assets at FVTOCI For the Year Ended December31,2021 For the Year Ended December31,2020 Balance at January 1 $ 321,627 $ 153,260 Recognized for the year Unrealized Gain (Loss) Equity instruments 135,234 132,192 Share from subsidiaries and associates accounted for using the equity method 36,974 36,175 Balance at December 31 $ 493,835 $ 321,627	For the Year Ended December31,2020
		$ 153,260 132,192 36,175 $ 321,627

Exchange differences on translating net assets of foreign operations are translated into the presentation currency, the New Taiwan dollar. The resulting currency translation differences are recognized in other comprehensive income as exchange differences on translating the financial statements of foreign operations in the respective period.

2) Unrealized gain (loss) on financial assets at FVTOCI

23. REVENUE

REVENUE
Revenue from contracts with customers Revenue from sale of goods	For the Year Ended December31,2021 $ 15,726,081	For the Year Ended December31,2020
			$ 10,993,555

Refer to Note 4 for description related to contracts with customers.

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24. PROFIT BEFORE INCOME TAX

Net profit before income tax includes the following:

a. Interest income

Interest income
Cash and cash equivalents Financial assets at FVTPL (Note 7) Financial assets at amortized cost (Note 9) Others	For the Year Ended December31,2021 $ 221 1,098 17 127 $ 1,463	For the Year Ended December31,2020
			$ 245 1,312 18 180 $ 1,755

b. Other income

Other income
Rental income - operating lease (Notes 15 and 29) Dividend income Others	For the Year Ended December31,2021 $ 35,557 19,077 7,199 $ 61,833	For the Year Ended December31,2020
			$ 36,426 7,555 6,832 $ 50,813

c. Other gains and losses

Other gains and losses
Gain on financial assets at FVTPL (Note 7) Loss on financial assets at FVTPL (Note 7) Net foreign exchange losses Loss on disposal and retirement of property, plant and equipment (Note 13) Expenses from rental assets Others Foreign exchange losses Total foreign exchange gains Total foreign exchange losses Net loss Finance costs Interest on bank loans Interest on lease liabilities (Note 29) Less: Capitalized interest (included in construction in progress)	For the Year Ended December31,2021 $ 3,753 ( 2,499 ) ( 29,425 ) ( 139 ) ( 6,484 ) ( 1,489) ($ 36,283) For the Year Ended December31,2021 $ 99,318 (128,743) ($ 29,425) For the Year Ended December31,2021 $ 4,785 499 ( 121) $ 5,163	For the Year Ended December31,2020
		$ 26,438 ( 4,299 ) ( 75,927 ) ( 51 ) ( 8,458 ) ( 1,631) ($ 63,928) For the Year Ended December31,2020
		$ 38,948 (114,875) ($ 75,927) For the Year Ended December31,2020
	(	(	$ 10,369 550 117) $ 10,802

d. Foreign exchange losses

e. Finance costs

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Information about capitalized interest is as follows:

Information about capitalized interest is as follows:
For the Year Ended December31,2021 Capitalized interest $ 121 Capitalization rate 0.80%~0.90% f. Depreciation and amortization (Statement 18) For the Year Ended December31,2021 Property, plant and equipment (Note 13) $ 163,000 Right-of-use assets (Note 14) 4,620 Intangible assets (Note 16) 1,752 Total $ 169,372 An analysis of depreciation by function Cost of goods sold $ 163,087 Operating expenses 1,161 Other gains and losses 3,372 $ 167,620 An analysis of amortization by function Cost of goods sold $ 1,600 General and administrative expenses 152 $ 1,752 g. Employee benefits expense (Statement 18) For the Year Ended December31,2021 Post-employment benefits (Note 21) Defined contribution plans $ 13,062 Defined benefit plans 4,657 17,719 Insurance expenses $ 35,960 Other employee benefits 553,273 Total employee benefits expense $ 606,952 An analysis of employee benefits expense by function Cost of goods sold $ 507,228 Operating expenses 99,724 $ 606,952	For the Year Ended December31,2020
	$ 117 0.90%~1.05% For the Year Ended December31,2020
	$ 161,706 4,619 2,042 $ 168,367 $ 159,989 992 5,344 $ 166,325 $ 1,600 442 $ 2,042 For the Year Ended December31,2020
		$ 13,097 5,974 19,071 $ 32,798 547,762 $ 599,631 $ 505,703 93,928 $ 599,631

h. Employees’ compensation and remuneration of directors

According to Articles of Incorporation of the Company, the Company accrued employees’ compensation and remuneration of directors at the rates of no less than 1% and no higher than 1%, respectively. However, the Company’s accumulated deficits should be offset in advance. When the employees of the Company’s subsidiaries meet specific requirements they are also entitled to receive compensation in shares or cash. These requirements are set by the board of directors. The employees’ compensation and remuneration of directors for

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the years ended December 31, 2021 and 2020, which were approved by the Company’s board of directors on March 9, 2022 and March 5, 2021, respectively, were as follows:

Employees’ compensation Remuneration of directors	For the Year Ended December31,2021 Accrual Rate Amount 1% $ 23,534 - $ -	For the Year Ended December31,2021 Accrual Rate Amount 1% $ 23,534 - $ -	For the Year Ended December31,2020	For the Year Ended December31,2020	For the Year Ended December31,2020
	Accrual Rate 1% -		Accrual Rate 1% -		Amount
					$ 22,812 $ -

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

There is no difference between the actual amounts of employees’ compensation and remuneration of directors paid and the amounts recognized in the financial statements for the years ended December 31, 2020 and 2019.

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

25. INCOME TAX

a. Major components of income tax expense recognized in profit or loss were as follows:

	For the Year Ended	For the Year Ended	For the Year Ended	For the Year Ended
	December31,2021		December31,2020
Current tax
In respect of the current year	$ 405,410		$ 309,148
Income tax on unappropriated earnings		34,731		7,867
Adjustments for prior years	(	3,644)	(	61)
		436,497		316,954
Deferred tax
In respect of the current year		43,429		21,643
Adjustments for prior years		-	(	2)
		43,429		21,641
Income tax expense recognized in
profit or loss	$ 479,926		$ 338,595
A reconciliation of accounting profit and income		tax expense is as follows:
	For the Year Ended		For the Year Ended
	December31,2021		December31,2020
Profit before income tax	$ 2,329,858		$ 2,258,413
Income tax expense calculated at the
statutory rate	$	465,972	$	451,683
Nondeductible expenses	in
determining taxable income		104		202
Tax-exempt income	(	17,235 )	(	14,973 )
Income tax on unappropriated earnings		34,731		7,867
Unrecognized deductible temporary
differences		-	(	105,339 )
Adjustments for prior years	(	3,644 )	(	63 )
Others	(	2)	(	782)
Income tax expense recognized in
profit or loss	$	479,926	$	338,595

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b. Income tax recognized in other comprehensive income

For the Year Ended For the Year Ended December 31, 2021 December 31, 2020

Deferred tax

In respect of the current year － Exchange differences on translating the financial statements of foreign operations $ 4,559 ( $ 17,148 ) － Remeasurement of defined benefit plans 2,177 300 Income tax recognized in other comprehensive income $ 6,736 ( $ 16,848 ) Current income tax assets and liabilities December 31, 2021 December 31, 2020 Current tax liabilities Income tax payable $ 443,684 $ 321,203

c. Current income tax assets and liabilities

d. Deferred tax assets and liabilities

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

For the Year Ended December 31, 2021

Deferred tax assets	Balance at January1	Recognized in Profit or Loss	Recognized in Other Comprehensi ve Income	Balance at December31
	$ 775 7,695 881 40,012 4,024 7,070 - 682 $ 61,139 $ 9,055 17,472 348 143,860 - $ 170,735	$ 206 ( 722 ) ( 30 ) ( 5,252 ) ( 118 ) ( 328 ) 5,628 23 ($ 593) $ - 42,257 ( 65 ) - 644 $ 42,836	$ - - - 2,177 - - - - $ 2,177 ( $ 4,559 ) - - - - ($ 4,559)	$ 981 6,973 851 36,937 3,906 6,742 5,628 705 $ 62,723 $ 4,496 59,729 283 143,860 644 $ 209,012
Temporary differences Allowance for inventory valuation Allowance for impaired receivables Loss on supplies Defined benefit plans Payables for annual leave Unrealized foreign exchange losses Unrealized net gain on sale of goods Others Deferred tax liabilities
Temporary differences Exchange differences on translating the financial statements of foreign operations Share of profit of foreign subsidiaries accounted for using the equity method Differences on depreciation between finance and tax Reserve for land revaluation increment tax Others

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For the Year Ended December 31, 2020

Deferred tax assets	Balance at January1	Recognized in Other Comprehensi ve Income	Balance at December 31
	$ 840 7,739 873 45,635 4,293 5,869 8,093 524 $ 73,866 $ - - 504 143,860 609 $ 144,973	$ - - - 300 - - ( 8,093 ) - ($ 7,793) $ 9,055 - - - - $ 9,055	$ 775 7,695 881 40,012 4,024 7,070 - 682 $ 61,139 $ 9,055 17,472 348 143,860 - $ 170,735
Temporary differences Allowance for inventory valuation Allowance for impaired receivables Loss on supplies Defined benefit plans Payables for annual leave Unrealized foreign exchange losses Exchange differences on translating the financial statements of foreign operations Others Deferred tax liabilities
Temporary differences Exchange differences on translating the financial statements of foreign operations Share of profit of foreign subsidiaries accounted for using the equity method Differences on depreciation between finance and tax Reserve for land revaluation increment tax Others

e. Income tax assessments

The Company’s income tax returns through 2019 have been assessed by the tax authorities.

26. EARNINGS PER SHARE

EARNINGS PER SHARE
Basic earnings per share Diluted earnings per share	For the Year Ended December31,2021 $ 4.89 $ 4.88	Unit: NT$ Per Share For the Year Ended December31,2020
			$ 5.07 $ 5.06

In calculating earnings per share, the impact of share dividend distribution has been adjusted retrospectively. The record date of new share issuance is set on September 10, 2021. Due to retrospective adjustment, the changes in basic and diluted earnings per share for the year ended December 31, 2020 are as follows:

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Unit: NT$ Per Share

		Unit: NT$ Per Share	Unit: NT$ Per Share
Basic earnings per share Diluted earnings per share	Before Retrospective Adjustment $ 5.58 $ 5.57	After Retrospective Adjustment
			$ 5.07 $ 5.06

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

NET PROFIT FOR THE YEAR

Earnings used in the computation of basic and diluted earnings per share Number of Shares Weighted average number of ordinary shares in computation of basic earnings per share Effect of potentially dilutive ordinary shares: Employees’ compensation Weighted average number of ordinary shares used in the computation of diluted earnings per share	For the Year Ended December31,2021 For the Year Ended December31,2020 $ 1,849,932 $ 1,919,818 Unit: In Thousand Shares For the Year Ended December31,2021 For the Year Ended December31,2020 378,654 378,654 793 674 379,447 379,328	For the Year Ended December31,2020	For the Year Ended December31,2020
			378,654 674 379,328

If the Company offered to settle compensation paid to employees in cash or shares, the Company assumed the entire amount of the compensation would be settled in shares and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, if the effect is dilutive. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the shareholders resolve the number of shares to be distributed to employees at their meeting in the following year.

27. CAPITAL MANAGEMENT

The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance. The Company’s overall strategy remains unchanged from the past year.

The capital structure of the Company consists of net debt and equity.

The senior management of the Company regularly reviews the Company ’s capital structure. The review includes the consideration of the cost of various types of capital and related risks. The Company balances its overall capital structure by paying dividends, borrowing new debt or repaying old debt, based on the recommendations of the senior management.

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28. FINANCIAL INSTRUMENTS

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

The Company’s management believes that the carrying amount of financial assets and financial liabilities that are not measured at fair value approximates their fair value. Otherwise, the fair value cannot be measured appropriately.

b. Fair value of financial instruments measured at fair value on a recurring basis
1) Fair value hierarchy

Fair value hierarchy
December 31, 2021 Financial assets at FVTPL Derivative instruments Investments in equity instruments －Domestic listed shares Mutual funds Beneficiary securities Total Financial assets at FVTOCI Investments in equity instruments －Domestic listed shares －Domestic unlisted shares Total December 31, 2020 Financial assets at FVTPL Derivative instruments Mutual funds Beneficiary securities Total Financial assets at FVTOCI Investments in equity instruments －Domestic listed shares －Domestic unlisted shares Total Financial liabilities at FVTPL Derivative instruments	Level 1	Level 2	Level3 $ - - - - $ - $ - 7 $ 7 Level3 $ - - - $ - $ - 7 $ 7 $ -	Total
	$ - 73,438 562,034 59,466 $ 694,938 $ 476,718 - $ 476,718 Level 1	$ 1,037 - - - $ 1,037 $ - - $ - Level 2		$ 1,037 73,438 562,034 59,466 $ 695,975 $ 476,718 7 $ 476,725 Total
	$ - 300,185 60,808 $ 360,993 $ 341,484 - $ 341,484 $ -	$ 431 - - $ 431 $ - - $ - $ 434		$ 431 300,185 60,808 $ 361,424 $ 341,484 7 $ 341,491 $ 434

There were no transfers between Levels 1 and 2 for the years ended December 31, 2021 and 2020.

2) Reconciliation of Level 3 fair value measurements of financial instruments

Financial assets at FVTOCI - equity instruments

Balance at January 1 Recognized in other comprehensive income (included in unrealized gain on financial assets at FVTOCI) Balance at December 31	For the Year Ended December31,2021 $ 7 - $ 7	For the Year Ended December31,2020	For the Year Ended December31,2020
		(	$ 27 20) $ 7

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3) Valuation techniques and inputs applied for Level 2 fair value measurement Financial Instruments Valuation Techniques and Inputs Derivatives - foreign exchange Discounted cash flow: Future cash flows are forward contracts estimated based on observable forward exchange rates at the end of the reporting period and contract forward rates, discounted at a rate that reflects the credit risk of various counterparties.

4) Valuation techniques and inputs applied for Level 3 fair value measurement

To determine the fair value for Level 3 financial instruments, the Company’s investment department conducts independent fair value verification using external resources so as to better reflect the market conditions, as well as periodically reviewing the valuation results in order to guarantee the rationality of the measurement. For unlisted domestic equity investments, the Company utilizes the asset approach and takes into account the most recent net asset value, observable financial status as well as the financing activities of investees in order to determine their net asset value. The unobservable input used was a discount for the lack of marketability of 15% on December 31, 2021 and 2020.

c. Categories of financial instruments

Categories of financial instruments
Financial assets Financial assets at FVTPL－ Mandatorily classified as at FVTPL Financial assets at amortized cost (Note 1) Financial assets at FVTOCI - Equity instruments Financial liabilities Financial liabilities at FVTPL－ Held for trading Financial liabilities at amortized cost (Note 2)	December31,2021 $ 695,975 2,551,261 476,725 - 1,784,278	December31,2020
		$ 361,424 2,131,111 341,491 434 1,685,951

Note 1. The balance includes financial assets at amortized cost, which includes cash and cash equivalents, notes and accounts receivable (including related parties), other receivables (including related parties and excluding VAT refund receivables) and pledged deposits.
Note 2. The balance includes financial liabilities at amortized cost, which includes shortterm and long-term loans, short-term bills payable, accounts payable (including related parties) and other payables (including related parties and excluding payables for taxes).
d. Financial risk management objectives and policies

The Company’s risk control and hedging strategy are influenced by its operational environment. The Company properly monitors and manages the risks related to business nature and according to the principle of risk diversification. These risks include market risk (including foreign currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

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1) Market risk

The main financial risks the Company is exposed to in the business activities are foreign exchange risk, interest rate risk, and other price risk.

There has been no change to the Company’s exposure to market risks or the manner in which these risks were managed and measured.

a) Foreign currency risk

The Company conducted foreign currency sales and purchases, which exposed the Company to foreign currency risk. In order to avoid the impact of foreign currency exchange rate changes, which lead to deductions in foreign currency denominated assets and fluctuations in their future cash flows, the Company used foreign exchange forward contracts to eliminate foreign currency exposure and thus mitigate the impact of the risk. The use of foreign exchange forward contracts was governed by the Company’s policies approved by the board of directors. Compliance with policies and exposure limits was reviewed by internal auditors on a continuous basis. The Company did not enter into or trade foreign exchange forward contracts for speculative purposes.

The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities are set out in Note 32. The derivatives exposing the Company to foreign currency risk are set out in Note 7.

Sensitivity analysis

The Company’s sensitivity analysis mainly focuses on the foreign currency risk of U.S. dollars at the end of the reporting period. Assuming a 3% strengthening/weakening of the functional currency against U.S. dollars, the net income before tax for the years ended December 31, 2021 and 2020 would have decreased/increased by $47,302 thousand and $37,028 thousand, respectively.

In management’s opinion, this sensitivity analysis is unrepresentative of the Company’s inherent foreign exchange risk because the exposure at the end of the reporting period did not reflect the exposure during the period.

b) Interest rate risk

The Company was exposed to the fair value risk of interest rate fluctuations for the fixed interest rate bearing financial assets and financial liabilities; the Company was exposed to the cash flow risk of interest rate fluctuations for the floating interest rate bearing financial assets and financial liabilities. The Company’s management regularly monitors the fluctuations on market rates and then adjusted its balance of floating rate bearing financial liabilities to make the Company’s interest rates more closely approach market rates in response to the interest rate risk.

The carrying amount of the Company’s financial assets and financial liabilities with exposure to interest rates at the end of the reporting period were as follows:

Fair value interest rate risk －Financial assets －Financial liabilities Cash flow interest rate risk －Financial assets －Financial liabilities	December31,2021 $ 322,331 542,938 121,027 150,000	December31,2020
		$ 321,387 347,452 59,820 150,000

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Sensitivity analysis

The sensitivity analysis below was determined based on the Company’s exposure to interest rate risk of cash flow for both financial assets and liabilities at the end of the reporting period. The fixed-rate financial assets and liabilities held by the Company are not included in the analysis as they are all measured at amortized cost. A 50 point fluctuation in interest rate was used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates. If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Company’s pre-tax profit for the years ended December 31, 2021 and 2020 would have decreased/increased by $145 thousand and $451 thousand, respectively.

c) Other price risk

The Company was exposed to price risk through its investments in domestic listed shares, foreign and domestic unlisted shares, beneficiary securities and mutual funds. The Company manages this exposure by maintaining a portfolio of investments with different risks. In addition, the Company has appointed a special team to monitor price risk.

Sensitivity analysis

The following sensitivity analysis was based on the prices of securities as of the balance sheet date. However, in the financial assets at fair value through profit or loss in which the Company invested, the risk of price fluctuation of money market funds was very limited, so it was not included in the analysis.

If the equity price increases / decreases by 5%, the net profit before tax for the years ended December 31, 2021 and 2020 would increase / decrease by $6,645 thousand and $3,040 thousand respectively due to the increase / decrease in the fair value of financial assets (excluding investment in money market funds) at FVTPL. Other comprehensive income before tax for the years ended December 31, 2021 and 2020 would increase / decrease by $23,836 thousand and $17,075 thousand respectively due to the increase / decrease in the fair value of financial assets at FVTOCI, respectively.

2) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. As at the end of the reporting period, the Company’s maximum exposure to credit risk, which would cause a financial loss to the Company due to the failure of counterparties to discharge an obligation and financial guarantees provided by the Company, could arise from:

a) The carrying amount of the respective recognized financial assets as stated in the balance sheets.
b) The maximum amount the entity would have to pay if the financial guarantee is called upon, irrespective of the likelihood of the guarantee being exercised.

The Company provided endorsement guarantees for the borrowings of subsidiaries. The guarantee amounts provided by the Company for endorsements were $730,475 thousand and $1,776,960 thousand, respectively, as of December 31, 2021 and 2020. However, according to the expectations on the balance sheet date, it is unlikely that the Company will pay the endorsement guarantees when the endorsee breaches the contract.

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As of December 31, 2021, except for specific customer’s accounts and notes receivable exceeded 22% of the total amount of all receivables, and the rest of the Company’s accounts receivable included numerous customers distributed over a variety of areas, and were not centered on a single customer or location. Furthermore, the Company mitigates credit concentration risk by obtaining letters of credit issued by financial institutions prior to shipment for the sales transactions to the aforementioned specific customers and continuously assesses the financial condition of its customers, and then the Company’s credit risk was limited. As at the end of the reporting period, the Company’s largest exposure of credit risk approximates to the carrying amount of financial assets.

3) Liquidity risk

The Company manages liquidity risk by monitoring and maintaining a level of cash and cash equivalents deemed adequate to finance the Company’s operations and mitigate the effects of fluctuations in cash flows.

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

The following table details the Company’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods based on the probable earliest repayment dates. The table was drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Company can be required to pay. The table includes both interest and principal cash flows.

December 31, 2021

December 31, 2021	December 31, 2021	December 31, 2021	December 31, 2021
Weighted Average Interest Rate (％) On Demand or Less than 1 Year 1-5 Years 5+ Years Non-derivative financial liabilities Non-interest bearing liabilities $ 1,136,943 $ 2,743 $ - Lease liabilities 1.1000 5,013 20,052 20,052 Floating interest rate liabilities 0.5167 150,000 - - Fixed interest rate liabilities 0.7820 200,000 300,000 - $ 1,491,956 $ 322,795 $ 20,052 Additional information about the maturity analysis for lease liabilities: Less than 1 Year 1-5Years 5-10Years Lease liabilities $ 5,013 $ 20,052 $ 20,052 December 31, 2020 Weighted Average Interest Rate (％) On Demand or Less than 1 Year 1-5 Years 5+ Years Non-derivative financial liabilities Non-interest bearing liabilities $ 1,238,651 $ 2,700 $ - Lease liabilities 1.1000 5,013 20,052 25,065 Floating interest rate liabilities 0.5158 150,000 - - Fixed interest rate liabilities 0.9000 - 300,000 - $ 1,393,664 $ 322,752 $ 25,065				5+ Years
				$ 20,052 5+ Years
	1.1000 0.5158 0.9000	$ 1,238,651 5,013 150,000 - $ 1,393,664	$ 2,700 20,052 - 300,000 $ 322,752	$ - 25,065 - - $ 25,065

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Additional information about the maturity analysis for lease liabilities: Less than 1 Year 1-5Years 5-10Years Lease liabilities $ 5,013 $ 20,052 $ 25,065	Additional information about the maturity analysis for lease liabilities: Less than 1 Year 1-5Years 5-10Years Lease liabilities $ 5,013 $ 20,052 $ 25,065	Additional information about the maturity analysis for lease liabilities: Less than 1 Year 1-5Years 5-10Years Lease liabilities $ 5,013 $ 20,052 $ 25,065
		$ 25,065

b) Financing facilities

Bank loans are an essential source of liquidity for the Company. The table below details the unused amount of bank loans at the end of the reporting period.

December 31, 2021 December 31, 2020 Bank loan facilities x － Amount unused $ 4,397,994 $ 5,169,600

29. TRANSACTIONS WITH RELATED PARTIES

The Company’s ultimate parent is USI Corporation, which held 36.79% of the ordinary shares of the Company as of December 31, 2021 and 2020.

Besides information disclosed elsewhere in the other notes, details of transactions between the Company and other related parties are disclosed below:

a. Names and relations of related parties

Related Party Name Relationship with the Company USI Corporation (“USI”) Ultimate parent company TAITA (BVI) Holding Co., Ltd.(TAITA(BVI)) Subsidiary Taita Chemical (Zhongshan) Co., Ltd. (“TTC Subsidiary (ZS)”) Taita Chemical (Tianjin) Co., Ltd. (“TTC (TJ)”) Subsidiary China General Plastics Corporation Associate CGPC Polymer Corporation Associate Taiwan VCM Corporation (“TVCM”) Associate China General Terminal & Distribution Associate Corporation (“CGTD”) Acme Electronics Corporation Associate Asia Polymer Corporation (“APC”) Fellow subsidiary USI Trading (Shanghai) Co., Ltd Fellow subsidiary Swanson Plastics Corporation Fellow subsidiary USI Management Consulting Corp. (“UM”) Fellow subsidiary Taiwan United Venture Management Corporation Fellow subsidiary USI Education Foundation (“USIF”) Substantial related party

b. Sales of goods

Sales of goods
RelatedParty Category/Name Subsidiary H Ultimate parent company Fellow subsidiary	For the Year Ended December31,2021 $ 1,049,003 4,576 - $ 1,053,579	For the Year Ended December31,2020
			$ 736,735 9,068 10,970 $ 756,773

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The Company’s credit period of sales of goods to related parties was from 30 days to 90 days after delivering the products. The sales of goods between the Company and its related parties had no material differences from those of general sales transactions.

c. Purchase of goods

Purchase of goods
RelatedParty Category/Name Associate Ultimate parent company Fellow subsidiary	For the Year Ended December31,2021 $ 2,338 679 242 $ 3,259	For the Year Ended December31,2020
			$ 2,370 - 203 $ 2,573

The Company’s credit period of purchase of goods from related parties was from 30 days after acceptance. The purchase of goods between the Company and its related parties had no material differences from those of general purchase transactions.

d. Receivables from related parties (excluding loans to related parties)

RelatedParty Category/Name Subsidiary Ultimate parent company	December31,2021 $ 542 - $ 542	December31,2020	December31,2020
			$ 2,818 27 $ 2,845

The outstanding accounts receivable from related parties were unsecured. No impairment loss was recognized.

e. Payables to related parties (excluding loans from related parties)

RelatedParty Category/Name Fellow subsidiary Associate	December31,2021 $ 28 - $ 28	December31,2020	December31,2020
			$ 11 487 $ 498

The outstanding accounts payable from related parties are not overdue and not guaranteed.

f. Endorsements/guarantees provided.

Endorsements/guarantees provided.
RelatedParty Category/Name Subsidiary TAITA(BVI) TTC (ZS)	December31,2021 $ 166,080 564,395 $ 730,475	December31,2020
			$ 1,340,480 436,480 $ 1,776,960

g. Other transactions with related parties
1) Rental income (classified as other income, see Notes 15 and 24)

RelatedParty Category/Name Associate CGTD TVCM Ultimate parent company	For the Year Ended December31,2021 $ 23,379 9,635 33,014 1,649 $ 34,663	For the Year Ended December31,2020	For the Year Ended December31,2020
			$ 24,082 9,635 33,717 1,666 $ 35,383

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2) Rental expenses (classified as operating costs, selling and marketing expenses and general and administrative expenses)

general and administrative expenses)
RelatedParty Category/Name Ultimate parent company USI Fellow subsidiary APC Associate	For the Year Ended December31,2021 $ 4,722 1,891 281 $ 6,894	For the Year Ended December31,2020
			$ 5,535 1,672 266 $ 7,473

The Company leased offices and parking spaces in Neihu from USI and APC. The rentals were set according to the actual rental area and paid on a monthly basis.

3) Lease arrangements

Lease arrangements
RelatedParty Category/Name Lease liabilities-current Fellow subsidiary APC Lease liabilities-non-current Fellow subsidiary APC RelatedParty Category/Name Lease expense Fellow subsidiary APC Interest expense Fellow subsidiary APC	December31,2021 $ 4,564 $ 38,374 For the Year Ended December31,2021 $ 5,013 $ 499	December31,2020
		$ 4,514 $ 42,938 For the Year Ended December31,2020
			$ 5,013 $ 550

The Company leased land in Linyuan from APC. The rental was paid on a monthly basis.

4) Storage tank operating expenses (classified as operating costs)

RelatedParty Category/Name Associate CGTD	For the Year Ended December31,2021 $ 18,784	For the Year Ended December31,2020	For the Year Ended December31,2020
			$ 13,210

The Company appointed CGTD to handle the storage tank operating procedures of styrene monomer and butadiene, such as transportation, storage and loading. The storage tank operating expenses were paid on a monthly basis.

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5) Management service income (classified as other income)

For the Year Ended For the Year Ended Related Party Category/Name December 31, 2021 December 31, 2020 Ultimate parent company USI $ 2,211 $ 2,122

6) Management service expenses (classified as general and administrative expenses and other gains and losses)

other gains and losses)
RelatedParty Category/Name Fellow subsidiary UM Others	For the Year Ended December31,2021 $ 48,067 - $ 48,067	For the Year Ended December31,2020
			$ 49,647 60 $ 49,707

The related contracts stated that the fellow subsidiary and parent company should provide labor support, equipment and other related services to the Company, and the service expenses were based on the actual quarterly expenses.

7) Donation (classified as general and administrative expenses)

For the Year Ended For the Year Ended Related Party Category/Name December 31, 2021 December 31, 2020 Substantial related party USIF $ 4,000 $ 1,000

8) Other expenses (classified as operating costs)

RelatedParty Category/Name Associate	For the Year Ended December31,2021 $ 1,627	For the Year Ended December31,2020	For the Year Ended December31,2020
			$ 1,467

9) Payments for property, plant and equipment

RelatedParty Category/Name Ultimate parent company Commission expense RelatedParty Category/Name Fellow subsidiary Other receivables RelatedParty Category/Name Subsidiary TTC (TJ) Others Associate Ultimate parent company Fellow subsidiary	For the Year Ended December31,2021 $ 390 For the Year Ended December31,2021 $ 388 December31,2021 $ 256,014 201 256,215 2,450 599 7 $ 259,271	For the Year Ended December31,2020	For the Year Ended December31,2020
		$ 1,583 For the Year Ended December31,2020
		$ 827 December31,2020
			$ 263,413 1,722 265,135 910 623 12 $ 266,680

10) Commission expense
11) Other receivables

Other receivables included raw material receivables, disbursement fee and management service receivables.

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12)	Other payables RelatedParty Category/Name Associate Fellow subsidiary Ultimate parent company	December31,2021 $ 4,639 1,523 633 $ 6,795	December31,2020	December31,2020
				$ 2,227 867 1,084 $ 4,178

Other payables included storage tank operating expense payables, rental expense payable and the allocation of service department costs payables.

h. Remuneration of key management personnel

Total remuneration for directors and other key management in 2021 and 2020 is as follows:

Salaries and others Retirement benefits	For the Year Ended December31,2021 $ 25,354 216 $ 25,570	For the Year Ended December31,2020	For the Year Ended December31,2020
			$ 22,136 216 $ 22,352

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

30. ASSETS PLEDGED AS COLLATERAL

The following assets were provided as collateral for line of credit borrowings, fuel purchases, the tariffs of imported raw materials and goods (Notes 9, 13, 15 and 17):

Pledged time deposits －Classified as financial assets at amortized cost - current －Classified as other assets - non- current Property, plant and equipment, net Investment properties, net	December31,2021 $ 3,000 16,619 - - $ 19,619	December31,2020	December31,2020
			$ 3,000 16,505 443,340 108,178 $ 571,023

31. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

In addition to those disclosed in other notes, significant commitments and contingencies of the Company were as follows:

a. As of December 31, 2021 and 2020, unused letters of credit amounted to approximately $64,509 thousand and $252,996 thousand, respectively.
b. Explanation for the gas explosion in Kaohsiung:

Regarding the gas explosion of the propylene pipeline of Lee Chang Yung Chemical Industry Corporation (“Lee Chang Yung Chemical”) on the night of July 31, 2014 operated by the invested company by the equity method, China General Terminal & Distribution Corporation (“CGTD”), the criminal case of the gas explosion incident was dismissed by the Supreme Court on September 15, 2021 and all three employees of CGTD were acquitted.

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CGTD arrived at an agreement with the Kaohsiung City Government on February 12, 2015, pledging certificates of bank deposits of $227,540 thousand, interests included, to the Kaohsiung City Government as collateral for the loss caused by the gas explosion. The Kaohsiung City Government also filed civil procedure requests in succession against LCY Chemical Corp., CGTD and CPC Corporation, Taiwan (“CPC”). Taiwan Power Company applied to the court for sequestration of CGTD's property on August 27 and November 26, 2015 and CGTD has deposited cash of $99,207 thousand to the court to avoid sequestration. Taiwan Water Corporation also applied to the court for false seizure of CGTD's property on February 3 and March 2, 2017 respectively. At the end of February 2022, the provisionally attached property was worth $12,472 thousand.

As for the victims, CGTD, LCY Chemical Corp. and the Kaohsiung City Government signed a tripartite agreement for the compensation of the 32 victims’ families on July 17, 2015. Each victim’s family received $12,000 thousand, and the total compensation was $384,000 thousand. The compensation was advanced by LCY Chemical Corp. LCY Chemical Corp. was in charge of negotiating the compensation with the victims’ families and signing the settlement agreement on behalf of the three parties.

As for the seriously injured, CGTD, LCY Chemical Corp. and the Kaohsiung City Government signed a tripartite agreement for the compensation of the 65 seriously injured victims’ families on October 25, 2017. Compensation was paid by CGTD and the Kaohsiung City Government, and CGTD was in charge of negotiating the compensation with the seriously injured victims’ families and signing the settlement agreement on behalf of the three parties with the 64 seriously injured victims’ families.

As of February 28, 2022, the victims and victims’ families had written letters or filed civil procedures (and criminal procedures) against CGTD, LCY Chemical Corp. and CPC for compensation. To reduce the lawsuit costs, CGTD had reached a settlement on the original claim for $46,677 thousand, and the amount of the settlement was $4,519 thousand. Along with the case still in litigation and the above-mentioned compensation, the accumulated amount of compensation is $3,856,447 thousand. The first instance verdict of some of these civil cases (indemnity amount of $1,341,128 thousand) have been convicted since June 22, 2018 and most cases determined that the negligence liability ratio of Kaohsiun Municipal Government, Lee Chang Yung Chemical and CGTD was 4:3:3, and that CGTD, Lee Chang Yung Chemical and other defendants should pay compensation of about $401,979 thousand (of which $6,194 thousand was exempted from liability by the court). Currently CGTD has filed an appeal for the adjudicated but unsettled civil cases and proceeded with the second instance procedure successively. The rest of the cases are still under trial in the Court of First Instance (the amount of compensation requested is approximately $2,012,493 thousand). CGTD signed a claim agreement with an insurance company, according to the negligence liability ratio determined by the judgment of first instance, it is estimated the settlement amount of victims and seriously injured, the compensation amount of civil litigation cases (including the settled cases), and estimated amount to be borne by itself after deducting the upper limit of insurance claim was $136,375 thousand, which had been included into the account. However, the actual amount of such settlement and compensation shall not be confirmed until the proportion of liability to be shared by CGTD is determined in accordance with the civil action.

55 -

32. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The following summary is presented in foreign currencies other than the functional currency. The exchange rate disclosed in the summary refers to the exchange rate of a foreign currency to the functional currency. The significant impact on assets and liabilities recognized in foreign currencies is as follows:

Unit: In Thousands of Foreign and Functional Currencies, Except for the Exchange Rate

December 31, 2021

December 31, 2021
Foreign currencyassets Monetary items USD HKD Non-monetary items Subsidiaries accounted for using the equity method USD Derivative instruments USD Foreign currencyliabilities Monetary items USD	Foreign Currency $ 83,753 1,345 113,455 7,340 26,790	Exchange Rate 27.6800 (USD:NTD) 3.5490 (HKD:NTD) 27.6800 (USD:NTD) 27.6800 (USD:NTD) 27.6800 (USD:NTD)	CarryingAmount
				$ 2,318,279 4,773 $ 2,323,052 $ 3,142,621 $ 1,037 $ 741,536

December 31, 2020

December 31, 2020
Foreign currencyassets Monetary items USD HKD RMB Non-monetary items Subsidiaries accounted for using the equity method USD Derivative instruments USD Foreign currencyliabilities Monetary items USD Non-monetary items Derivative instruments USD	Foreign Currency $ 67,321 586 894 103,650 3,000 23,983 3,000	Exchange Rate 28.4800 (USD:NTD) 3.6730 (HKD:NTD) 4.3648 (RMB:NTD) 28.4800 (USD:NTD) 28.4800 (USD:NTD) 28.4800 (USD:NTD) 28.4800 (USD:NTD)	CarryingAmount
				$ 1,917,291 2,153 3,902 $ 1,923,346 $ 2,951,653 $ 431 $ 683,038 $ 434

The unrealized and realized foreign exchange gains and losses were a loss of $29,425 thousand and a gain of $75,927 thousand for the years ended December 31, 2021 and 2020, respectively. Due to the numerous foreign currency transactions and functional currencies of each individual entity of the Company, foreign exchange gains and losses cannot be disclosed on the respective significant foreign currency.

56 -

33. Separately Disclosed Items

a. Information about significant transactions:
1) Financing provided to others. (None)
2) Endorsements/guarantees provided. (Table 1)
3) Marketable securities held (excluding investments in subsidiaries and associates). (Table 2)
4) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital. (Table 3)
5) Acquisitions of individual real estate at costs of at least NT$300 million or 20% of the paid-in capital. (None)
6) Disposals of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital. (None)
7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital. (Table 4)
8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital. (Table 5)
9) Trading in derivative instruments. (Note 7)
b. Information about investees. (Table 6)
c. Information on investments in mainland China:
1) Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, net income of investees, investment income or loss, carrying amount of the investment at the end of the year, repatriations of investment income, and limit on the amount of investment in the mainland China area. (Table 7)
2) Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses:
- a) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the year. (None)
- b) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the year. (Tables 4 and 5)
- c) The amount of property transactions and the amount of the resultant gains or losses. (None)
- d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the year and the purposes. (Table 1)
- e) The highest balance, the ending balance, the interest rate range, and total current period interest with respect to financing of funds. (None)
- f) Other transactions that have a material effect on the profit or loss for the year or on the financial position, such as the rendering or receipt of services. (None)
d. Information on major shareholders (names of shareholders with a shareholding ratio of 5% or more as well as number and proportion of shares held). (Table 8)
57 -

TABLE 1

TAITA CHEMICAL CO., LTD.

ENDORSEMENTS/GUARANTEES PROVIDED FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

No.	Endorser/Guarantor	Endorsee/Guarantee	Endorsee/Guarantee	Limits on Endorsement/Guarantee Given on Behalf of Each Party (Note 2)	Maximum Amount Endorsed/Guaranteed During the Period (Note 1)	Outstanding Endorsement/Guarantee at the End of the Period (Note 1)	Actual Borrowing Amount	Amount Endorsed/Guaranteed by Collateral	Ratio of Accumulated Endorsement/Guarantee to Net Equity in Latest Financial Statements (%)	Aggregate Endorsement/Guarantee Limit (Note 2)	Endorsement/Guarantee Given by Parent on Behalf of Subsidiaries	Endorsement/Guarantee Given by Subsidiaries on Behalf of Parent	Endorsement/Guarantee Given on Behalf of Companies in Mainland China
		Name of Associates	Relationship
0 0	Taita Chemical Co., Ltd. Taita Chemical Co., Ltd.	TAITA (BVI) Holding Co., Ltd. Taita Chemical (Zhongshan) Co., Ltd.	100% voting shares directly owned by the Company 100% voting shares directly owned by the Company’s subsidiary	$ 7,661,813 7,661,813	$ 876,800 ( USD 10,000 thousand ) (NT$ 600,000 thousand) 564,395 ( RMB 130,000 thousand )	$ 166,080 ( USD 6,000 thousand ) 564,395 ( RMB 130,000 thousand )	$ - -	$ - -	2.17% 7.37%	$ 11,492,720 11,492,720	Yes Yes	No No	No Yes

Note 1. The foreign currency amount is calculated based on the spot exchange rate as of December 31, 2021.

Note 2. The maximum total endorsement/guarantee shall not exceed 150% of the equity attributable to owners of the Company. The endorsement/guarantee on behalf of other company shall not exceed 100% of the equity attributable to owners of the Company.

The maximum total endorsement/guarantee shall not exceed 200% of the equity attributable to owners of the Company and its subsidiaries. The endorsement/guarantee on behalf of other company shall not exceed 150% of the equity attributable to owners of the Company and its subsidiaries.

58 -

TABLE 2

TAITA CHEMICAL CO., LTD.

MARKETABLE SECURITIES HELD DECEMBER 31, 2021

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

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31,2021	December 31,2021	December 31,2021	Note
				Number of Shares	Carrying Amount	Percentage of Ownership (%)	Fair Value
Taita Chemical Co., Ltd. TAITA (BVI) Holding Co., Ltd.	Ordinary shares USI Corporation Harbinger Venture Capital Corp. UPC Technology Corporation China Steel Corporation Tung Ho Steel Enterprise Corp. United Microelectronics Corp. Quanta Computer Inc. ShunSin Technology Holdings Limited Mutual funds FSITC Money Market Fund UPAMC James Bond Money Market Fund Hua Nan Phoenix Money Market Fund Yuanta De-Li Money Market Fund Capital Money Market Fund Taishin 1699 Money Market Fund KGI Victory Money Market Fund Beneficiary securities Cathay No. 1 Real Estate Investment Trust Fund Shares Budworth Investment Ltd. Teratech Corporation Sohoware Inc.－preference shares	Ultimate parent company －－－－－－－－－－－－－－－－－－	Financial assets at FVTOCI - non-current 〃 Financial assets at FVTPL - current 〃〃〃〃〃 Financial assets at FVTPL - current 〃〃〃〃〃〃 Financial assets at FVTPL - current Financial assets at FVTOCI - non-current Financial assets at FVTPL - non-current 〃	15,109,901 990 700,000 650,000 167,500 120,000 125,000 48,000 554,887 2,963,490 3,777,217 3,036,468 6,136,099 7,310,690 8,552,784 3,280,000 20,219 112,000 100,000	$ 476,718 7 15,120 22,978 11,239 7,800 11,837 4,464 100,000 50,001 62,020 50,012 100,001 100,000 100,000 59,466 6 (US$ thousand) - -	1.27% 0.50% 0.05% - 0.02% - - 0.04% - - - - - - - - 2.22% 0.73% -	$ 476,718 7 15,120 22,978 11,239 7,800 11,837 4,464 100,000 50,001 62,020 50,012 100,001 100,000 100,000 59,466 6 (US$ thousand) - -	(Note 1) (Note 3) (Note 1) (Note 1) (Note 1) (Note 1) (Note 1) (Note 1) (Note 2) (Note 2) (Note 2) (Note 2) (Note 2) (Note 2) (Note 2) (Note 1) (Note 3) (Note 4) (Note 4)

Note 1. The fair value is calculated based on the closing prices at TWSE on the last trading day of December 2021.

Note 2.

The fair value is calculated based on the net assets value of each fund on the last trading day of December 2021.

Note 3. The Company utilizes the asset approach and takes into account the most recent net asset value, observable financial status as well as the financing activities of investees in order to determine their net asset value. Note 4. As of December 31, 2021, the Company evaluates the fair value of the equity instrument as $0.

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TABLE 3

TAITA CHEMICAL CO., LTD.

MARKETABLE SECURITIES ACQUIRED AND DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2021

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

Company Name	Type and Name of Marketable Securities	Financial Statement Account	Counterparty	Relationship	BeginningBalance(Note)	BeginningBalance(Note)	Acquisition	Acquisition		Disposal	Disposal		EndingBalance(Note)	EndingBalance(Note)
					Number of Shares	Amount	Number of Shares	Amount	Number of Shares	Amount	Carrying Amount	Gain (Loss) on Disposal	Number of Shares	Amount
Taita Chemical Co., Ltd.	Mutual funds Hua Nan Phoenix Money Market Fund Hua Nan Kirin Money Market Fund Capital Money Market Fund CTBC Hwa-win Money Market Fund UPAMC James Bond Money Market Fund	Financial assets at FVTPL - current 〃〃〃〃	－－－－－	－－－－－	5,248,671 6,962,057 5,225,881 - -	$ 86,000 84,000 85,000 - -	36,399,248 37,264,857 18,423,866 33,288,910 21,822,997	$ 597,000 450,000 300,000 370,000 368,000	37,870,702 44,226,914 17,513,648 33,288,910 18,859,507	$ 621,110 534,088 285,109 370,034 318,049	$ 621,000 534,000 285,000 370,000 318,000	$ 110 88 109 34 49	3,777,217 - 6,136,099 - 2,963,490	$ 62,000 - 100,000 - 50,000

Note: The ending balance of mutual funds is the original purchase cost.

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TABLE 4

TAITA CHEMICAL CO., LTD.

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2021

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

Company Name	Counterparty	Relationship	Transaction	Transaction	Details		Abnormal Transaction	Abnormal Transaction	Notes/Accounts Receivable(Payable)	Notes/Accounts Receivable(Payable)	Note
			Purchase/Sale	Amount	% of Total	Payment Terms	Unit Price	Payment Terms	Financial Statement Account and EndingBalance	% of Total
Taita Chemical Co., Ltd.	Taita Chemical (Zhongshan) Co., Ltd.	Sub-subsidiary	Sale	( $ 1,049,003 ) (US$ 37,578 thousand)	( 6.67% )	30 days	No significant difference	No significant difference	Accounts receivable from related parties $ 542 (US$ 20 thousand)	0.03%	－

61 -

TABLE 5

TAITA CHEMICAL CO., LTD.

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL DECEMBER 31, 2021

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

Company Name	Counterparty	Relationship	Ending Balance	Turnover Rate	Overdue	Overdue	Amounts Received in Subsequent Period (Note 2)	Allowance for Impairment Loss
					Amount	Actions Taken
Taita Chemical Co., Ltd.	Taita Chemical (Tianjin) Co., Ltd.	Sub-subsidiary	Other receivables $ 256,014 (US$9,249 thousand)(Note 1)	-	$ 256,014	Keep collecting the outstanding payment	$ -	$ -

Note 1. The total amount of Taita Chemical Co., Ltd. from selling raw materials to Taita Chemical (Tianjin) Co., Ltd. Was reclassified to other receivables owing to it was over due for a normal crediting period.

Note 2. There was no amount received in the subsequent period as of March 9, 2022.

62 -

TABLE 6

TAITA CHEMICAL CO., LTD.

INFORMATION ON INVESTEES FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount	Original Investment Amount	As of December	As of December	31,2021	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note (Note 1)
				December 31, 2021	December 31, 2020	Number of Shares	%	Carrying Amount
Taita Chemical Co., Ltd. TAITA (BVI) Holding Co., Ltd.	TAITA (BVI) Holding Co., Ltd. China General Plastics Corporation China General Terminal & Distribution Corporation Acme Electronics Corporation ACME Electronics (Cayman) Corp.(ACME (Cayman))	British Virgin Islands Taipei, Taiwan Taipei, Taiwan Taipei, Taiwan British Cayman Islands	Reinvestment Manufacture and marketing of PVC plastic cloth and three- time processed products Warehousing and transportation of petro chemical raw materials Manufacture and marketing of manganese-zinc and ferrite core Reinvestment	$ 2,483,948 (US$89,738 thousand) 65,365 41,082 44,771 47,057 (US$1,700 thousand)	$ 2,483,948 (US$89,738 thousand) 65,365 41,082 44,771 47,057 (US$1,700 thousand)	89,738,000 11,516,174 22,009,592 4,445,019 2,695,619	100% 1.98% 33.33% 2.43% 5.39%	$ 3,142,621 (US$113,455 thousand) 221,245 373,731 32,429 66,405 (US$2,399 thousand)	$ 211,285 (Gain US$7,532 thousand) 2,468,676 63,389 59,329 62,808 (Gain US$2,252 thousand)	$ 211,285 (Gain US$7,532 thousand) 48,928 21,130 1,441 -	Subsidiary Investments accounted for using the equity method Investments accounted for using the equity method Investments accounted for using the equity method Investments accounted for using the equity method

Note 1. Except for the calculation of ACME and ACME (Cayman) was based on the unaudited financial statements for the year ended December 31, 2021, the calculation of the rest investees was based on their audited financial statements for the same period. Note 2. Investments in mainland China are included in Table 7.

63 -

TABLE 7

TAITA CHEMICAL CO., LTD.

INFORMATION ON INVESTMENTS IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investee Company	Main Businesses and Products	Paid-in Capital	Paid-in Capital	Method and Medium of Investment	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2021	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2021	Investment Flows	Investment Flows	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2021	Net Income (Loss) of the Investee (Note 5)	% Ownership of Direct or Indirect Investment	Investment Gain (Loss) (Note 5)	Carrying Amount as of December 31, 2021 (Note 5)	Accumulated Repatriation of Investment Income as of December 31, 2021
							Outflow	Inflow
Taita Chemical (Zhongshan) Co., Ltd. (“TTC (ZS)”) (Note 6) Taita Chemical (Tianjin) Co., Ltd. (“TTC (TJ)”) (Note 7) ACME Electronics (Kunshan) Co., Ltd. (“ACME (KS)”)	Production and marketing of polystyrene derivatives Production and marketing of polystyrene derivatives Manufacturing and marketing of manganese-zinc soft ferrite core	$ 1,280,200 (US$ 46,250 thousand) (Note 1) 757,048 (US$ 27,350 thousand) (Note 2) 850,468 (US$ 30,725 thousand)		Investments through a holding company registered in a third region Investments through a holding company registered in a third region Investments through ACME Electronics (Cayman) Corp. registered in a third region	$ 1,190,240 ( USD 43,000仟元) 719,680 ( USD 26,000仟元) 37,479 ( USD 1,354仟元)		$ - - -	$ - - -	$ 1,190,240 (US$ 43,000 thousand) 719,680 (US$ 26,000 thousand) 37,479 (US$ 1,354 thousand)	$ 218,742 (Gain US$7,795 thousand) ( 10,135 ) ( Loss US$ 361 thousand ) 45,024 (Gain US$1,616 thousand)	100% 100% 5.39%	$ 218,742 (Gain US$7,795 thousand) ( 10,135 ) (Loss US$ 361 thousand) 2,429 (Gain US$ 87 thousand)	$ 1,817,579 (US$ 65,664 thousand) ( 114,144 ) (US$ 4,124 thousand) 44,556 (US$ 1,610 thousand)	$ - - -

Accumulated Outward Remittance for Investment in Mainland China as of December 31,2021			Investment Amounts Authorized by Investment Commission,MOEA			Upper Limit on the Amount of Investment Stipulated by Investment Commission,MOEA
$ 1,947,399 (US$70,354 thousand)			$ 2,098,623 (US$75,817 thousand)(Note 3)			$ -(Note 4)

Note 1. TTC (ZS) resolved to issue share dividends of US$3,250 thousand in 2007.

Note 2. TTC (TJ) resolved to issue share dividends of US$1,350 thousand in 2012.

Note 3. The amount distributed from share dividends included US$3,250 thousand from TTC (ZS), US$1,350 thousand from TTC (TJ) and US$802 thousand from ACME (KS).

Note 4. According to the Letter No. 10820415160 issued by the Ministry of Economic Affairs on June 6, 2019, the upper limit on investment in mainland China pursuant to the “Principle of Investment or Technical Cooperation in Mainland China” is not applicable.

Note 5. The basis for investment income (loss) recognition is from financial statements audited and attested by the parent company’s ROC-based CPA.

Note 6. TTC (ZS) has resolved the earnings distribution from 2007 to 2020 in the amount to RMB 306,950 thousand at the board meeting held on October 14, 2021 and the earnings have been distributed to Zhangzhou Taita Chemical Co., Ltd. on March 8, 2022.

Note 7. The Company’s management decided to suspend TTC (TJ)’s production in from April 2019, please refer to Note 12 for details.

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TABLE 8

TAITA CHEMICAL CO., LTD.

INFORMATION ABOUT SUBSTANTIAL SHAREHOLDERS DECEMBER 31, 2021

Name of substantial shareholders	Shares	Shares
	Number of shares held	%
Union Polymer International Investment Corporation	139,298,343	36.79%

Note: The information of major shareholders in this attachment refers to the information calculated by the Taiwan Depository & Clearing Corporation on the last business day at the end of the current quarter of which the total number of common stocks and special stocks of the Company held, amounting to more than 5%, by the shareholder has been delivered without physical registration (including treasury shares). The capital stock recorded in the consolidated financial statements of the Company and the actual number of shares delivered without physical registration may be different or discrepant due to different compilation and calculation basis.

65 -

§STATEMENTS OF SIGNIFICANT ACCOUNTING SUBJECTS§

ITEM
Statement of Assets, Liabilities and Equity Items
Statement of Cash and cash equivalents
Statement of Financial assets at FVTPL - current
Statement of Account and Notes Receivable
Statement of Other Receivables
Statement of Inventories
Statement of Prepayments and Other Current Assets
Statement of Financial assets at FVTOCI - non-current
Statement of Changes in Investments Accounted for Using
the Equity Method
Statement of Changes in Property, Plant, and Equipment
Statement of Changes in Accumulated Depreciation of
Property, Plant, and Equipment
Statement of Changes in Right-of-use Assets
Statement of Changes in Accumulated Depreciation of Right-
of-use Assets
Statement of Deferred Tax Assets
Statement of Short-term Borrowings
Statement of Accounts Payable
Statement of Other Payables
Statement of Long-term Borrowings
Statement of Deferred tax liabilities
Statement of Profit or Loss Items
Statement of Sales Revenue
Statement of Cost of Goods Sold
Statement of Manufacturing Expenses
Statement of Selling and Marketing Expenses
Statement of General and Administrative Expenses
Statement of Research and Development Expenses
Statement of Other Gains and Losses, Net
Statement of Finance Costs
Statement of Employee Benefits and Depreciation and
Amortization Expenses by Function

NUMBER/INDEX

1
2
3
Note 10
4
5
6
7
Note 13
Note 13
8
8
Note 25
9
10
Note 19
11
Note 25
12
13
14
15
16
17
Note 24
Note 24
18

66 -

Statement 1

TAITA CHEMICAL CO., LTD.

STATEMENT OF CASH AND CASH EQUIVALENTS DECEMBER 31 , 2021

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

Item Summary Petty cash Bank deposits Checking accounts deposits Demand deposits－ NTD Demand deposits－ USD USD 3,144,019.06 (Note) Demand deposits－ HKD HKD 933,234.91 (Note) Demand deposits－ CNY CNY 9,156.41 (Note) Demand deposits－ JPY JPY 77,746.00 (Note) Demand deposits－ EUR EUR 246.52 (Note) Demand deposits－ GBP GBP 56.54 (Note) Cash equivalents Time deposits － USD Expired by 2022.1, interest rates at 0.77% to 0.17%, USD10,900,000 (Note) Time deposits － NTD Expired by 2022.11, interest rates at 0.77% Note: USD exchange rate at USD1=NTD 27.6800 HKD exchange rate at HKD1=NTD 3.5490 RMB exchange rate at CNY1=NTD 4.3415 JPY exchange rate at JPY1=NTD 0.2405 EUR exchange rate at EUR1=NTD 31.3200 GBP exchange rate at GBP1=NTD 37.3000		Amount
		$ 441 1,695 28,620 87,026 3,312 40 19 8 2 120,722 301,712 3,000 304,712 $ 425,875

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Statement 2

TAITA CHEMICAL CO., LTD.

STATEMENT OF FINANCIAL ASSETS AT FVTPL - CURRENT DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Financial assets at FVTPL - non- derivatives financial products Domestic listed shares UPC Technology Corporation China Steel Corporation Tung Ho Steel Enterprise Corp. United Microelectronics Corp. Quanta Computer Inc. ShunSin Technology Holdings Limited Mutual funds FSITC Money Market Fund UPAMC James Bond Money Market Fund Hua Nan Phoenix Money Market Fund Yuanta De-Li Money Market Fund Capital Money Market Fund Taishin 1699 Money Market Fund KGI Victory Money Market Fund Beneficiary securities Cathay No. 1 Real Estate Investment Trust Fund Adjustments on valuation Financial assets at FVTPL - derivatives financial products Foreign exchange forward contracts	Number of Shares (in Thousands) 700 650 168 120 125 48 555 2,963 3,777 3,036 6,136 7,311 8,553 3,280		Cost $ 16,543 25,196 12,032 6,984 10,588 4,436 75,779 100,000 50,000 62,000 50,000 100,000 100,000 100,000 562,000 33,464 671,243 23,695 $ 694,938	Unit Price(NT$) 21.6000 35.3500 67.1000 65.0000 94.7000 93.0000 180.2170 16.8723 16.4196 16.4704 16.2971 13.6786 11.6921 18.1300		Total $ 15,120 22,978 11,239 7,800 11,837 4,464 73,438 100,000 50,001 62,020 50,012 100,001 100,000 100,000 562,034 59,466 $ 694,938 $ 1,037	Note

68 -

Statement 3

TAITA CHEMICAL CO., LTD.

STATEMENT OF ACCOUNT AND NOTES RECEIVABLE DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Name ofCustomer Notes receivable Non-related party CHINGKANG INDUSTRIAL CO., LTD. ASLI MECHANICAL CO., LTD. ANTING ENTERPRISE CO., LTD. KUANG LI SHYNG CO., LTD. CHINA ACOUSTECH INTERNATIONAL INC. NANYANG DEVELOPMENT INDUSTRIAL CO., LTD. Others (Note) Accounts receivable Non-related party BESTWAY (NANTONG) RECREATION CORP. NINGBO MORE INTEREST I/E CO.,LTD. NINGBO DINGHAO NEW MATERIAL GRAND ENERGY CO., LTD NINGBO HOMELINK ECO-ITECH CO.,LTD. Others (Note) Loss allowances Related party Taita Chemical (Zhongshan) Co., Ltd.	Summary Loans Loans Loans Loans Loans Loans Loans Loans Loans Loans Loans Loans Loans Loans Loans		Amount
		(	$ 5,593 3,161 2,531 2,434 2,390 2,354 26,266 44,729 406,552 173,882 129,629 109,128 101,170 921,356 53,733) 1,787,984 542 $ 1,833,255

Note: The amount of individual customer included in others does not exceed 5% of the account balance.

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Statement 4

TAITA CHEMICAL CO., LTD.

STATEMENT OF INVENTORIES DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item Finished goods Work in process Raw materials Production supplies Inventory in transit Allowance for inventory valuation (Notes 1 and 2) Net amount		Amount	Amount	Amount
		Cost $ 268,103 105,413 374,318 20,817 179,660 948,311 4,905) $ 943,406	Market price (Note2)
	(			$ 331,489 133,566 360,113 20,394 207,800 $ 1,053,362

Note 1. Allowance for inventory valuation is provided for inventory impairment losses for obsolete items and normal items which are carried at cost higher than the market price.
Note 2. Market value is calculated using net realizable value.
Note 3. The insured amount of inventories was $1,059,222 thousand.
70 -

Statement 5

TAITA CHEMICAL CO., LTD.

STATEMENT OF PREPAYMENTS AND OTHER CURRENT ASSETS DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item Right to recover lent materials Supplies Prepayments for goods Others (Note)		Amount
		$ 70,090 55,389 7,298 5,730 $ 138,507

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

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Statement 6

TAITA CHEMICAL CO., LTD.

STATEMENT OF FINANCIAL ASSETS AT FVTOCI - NON-CURRENT FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Name of the Financial Product USI Corporation Harbinger Venture Capital Corp. Total	Balance at	January1 FairValue $ 341,484 7 $ 341,491	Increase Number of Shares (in Thousands) Amount - $ 135,234 - - $ 135,234	Increase Number of Shares (in Thousands) Amount - $ 135,234 - - $ 135,234	Decrease Number of Shares (in Thousands) Amount - $ - - - $ -	Decrease Number of Shares (in Thousands) Amount - $ - - - $ -	Balance at December31 Number of Shares (in Thousands) FairValue 15,110 $ 476,718 1 7 $ 476,725	Balance at December31 Number of Shares (in Thousands) FairValue 15,110 $ 476,718 1 7 $ 476,725	Guarantee or Pledge None None	Note
	Number of Shares (in Thousands) 15,110 1		Number of Shares (in Thousands) - -		Number of Shares (in Thousands) - -		Number of Shares (in Thousands) 15,110 1
										Note 1 －

Note 1. The increased amount of $135,234 thousand during the year was due to the change in adjusting the fair value.

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Statement 7

TAITA CHEMICAL CO., LTD.

STATEMENT OF CHANGES IN INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD FOR THE YEAR ENDED DECEMBER 31, 2021

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

Investee Company TAITA (BVI) Holding Co., Ltd. China General Plastics Corporation China General Terminal & Distribution Corporation Acme Electronics Corporation Subtotal Adjustments from allowance Net amount	Balance at	January1 Amount $ 3,095,906 193,178 315,711 35,209 3,640,004 ( 148,806) $ 3,491,198	Increase Number of Shares (in Thousands) Amount - $ 213,761 548 48,969 2,092 58,224 - 1,441 322,395 - $ 322,395	Increase Number of Shares (in Thousands) Amount - $ 213,761 548 48,969 2,092 58,224 - 1,441 322,395 - $ 322,395	Decrease Number of Shares (in Thousands) Amount - $ - - 19,862 - 204 - 51 20,117 23,450 $ 43,567	Decrease Number of Shares (in Thousands) Amount - $ - - 19,862 - 204 - 51 20,117 23,450 $ 43,567	Balance at December	Balance at December	Balance at December	31 Amount $ 3,309,667 222,285 373,731 36,599 3,942,282 172,256) $ 3,770,026	Market Value/Net Equity Value Unit Price Amount 35.02 $ 3,142,621 34.70 399,611 16.98 373,731 53.50 237,809 $ 4,153,772	Market Value/Net Equity Value Unit Price Amount 35.02 $ 3,142,621 34.70 399,611 16.98 373,731 53.50 237,809 $ 4,153,772	Guarantee or Pledge None None None None	Note
	Number of Shares (in Thousands) 89,738 10,968 19,918 4,445		Number of Shares (in Thousands) - 548 2,092 -		Number of Shares (in Thousands) - - - -		Number of Shares (in Thousands) 89,738 11,516 22,010 4,445	Sharehol ding (%) 100.00 1.98 33.33 2.43			Unit Price 35.02 34.70 16.98 53.50
		(							(					Notes 1 and 2 Notes 1, 3 and 7 Notes 1 and 4 Notes 1, 5 and 8 Notes 1 and 6

Note 1. Except for the calculation of ACME was based on the unaudited financial statements for the year ended December 31, 2021, the calculation of the investment income and net equity of the rest investees was based on their audited financial statements for the same period.
Note 2. The increase was due to the recognition of investment income of $211,285 thousand and unrealized loss on sales of $2,476 thousand by the investee.
Note 3. The increase in the number of shares for the year was due to the stock dividends of 548 thousand shares received; the increase in the number of shares for the year was due to the recognition of investment income of $48,928 thousand, the adjustment to capital surplus of $33 thousand for the change in ownership ratio and the recognition of a change in the remeasurement of the investee's defined benefit plan of $8 thousand; the decrease was due to the decrease in cash dividend of $1.80 per share of $19,742 thousand and the adjustment of $120 thousand to the valuation of financial assets at fair value through other comprehensive income.
Note 4. The increase in the number of shares was due to the distribution of stock dividends of 2,092 thousand shares; the increase in investment gains was due to the recognition of investment income of $21,130 thousand and the adjustment of $37,094 thousand in the valuation of financial assets at fair value through other comprehensive income; the decrease was due to the recognition of $204 thousand in the remeasurement of the investee's defined benefit plan.
Note 5. The increase was due to the recognition of investment income of $1,441 thousand and the decrease was due to the recognition of a change in the remeasurement of the investee's defined benefit plan of $51 thousand.
Note 6. The decrease represents the difference after the translation of the foreign currency from the financial statements of the investee company.
Note 7. The market value is calculated based on the closing prices at TWSE on the last trading day of December 2021.
Note 8. The market value is calculated based on the closing prices at TPEX on the last trading day of December 2021.
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Statement 8

TAITA CHEMICAL CO., LTD.

STATEMENT OF CHANGES IN RIGHT-OF-USE ASSETS FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item Cost Land Accumulated depreciation Land	Balance at January1 $ 55,433 9,239 $ 46,194		Increase $ - $ 4,620		Decrease $ - $ -	Balance at December 31 $ 55,433 13,859 $ 41,574	Note

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Statement 9

TAITA CHEMICAL CO., LTD.

STATEMENT OF SHORT-TERM BORROWINGS DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Type of Loans Unsecured borrowings Export-Import Bank of the Republic of China Taipei Fubon Bank	Interest Rate (%) 0.52% 0.74%		Balance at December31 $ 150,000 200,000 $ 350,000	Contract Period 110.04.14-111.04.14 110.12.29-111.01.05	Financing facilities $ 150,000 600,000 $ 750,000	Pledge or Guarantee
						None None

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Statement 10

TAITA CHEMICAL CO., LTD.

STATEMENT OF ACCOUNTS PAYABLE DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Name ofSupplier Non-related party Formosa Chemicals and Fibre Corporation Taiwan Styrene Monomer Corporation Altis International Singapore (Pte.) Limit China Petrochemical Development Corporation Formosa Plastics Corporation Others (Note) Related party Swanson Plastics Corporation		Amount
		$ 298,934 206,520 168,445 74,681 70,113 128,536 947,229 28 $ 947,257

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

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Statement 11

TAITA CHEMICAL CO., LTD.

STATEMENT OF LONG-TERM BORROWINGS DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Type of Loans Unsecured borrowings Yuanta Commercial Bank	Interest Rate (%) 0.81%		Balance at December31 $ 300,000	Contract Period 110.02.18-113.02.17	Financing facilities $ 300,000	Pledge or Guarantee
						None

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Statement 12

TAITA CHEMICAL CO., LTD.

STATEMENT OF SALES REVENUE FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item ABS GPS EPS SM Glasswool products Cubic printing products (Note) IPS	Quantity (Ton) 121,190 95,281 58,414 35,644 13,066 49,760 280		Amount
			$ 7,435,425 3,990,846 2,700,273 1,048,463 494,522 41,119 15,433 $ 15,726,081

Note: The unit of the sales of cubic printing products is JIG.

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Statement 13

TAITA CHEMICAL CO., LTD.

STATEMENT OF COST OF GOODS SOLD FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item
Raw materials
Raw materials at the beginning
Purchase of materials
Sale of materials
Transfer expenses
Raw materials at the end
Director labor
Manufacturing expenses (Statement 14)
Manufacturing cost
Work in process at the beginning
Work in process at the end
Cost of finished goods
Finished goods at the beginning
Cost of finished goods from purchases
Adjustment of other costs
Finished goods at the end (including in transit)
Sales of raw materials
Adjustment from inventories valuation

Amount

$ 290,156
11,523,621
(
1,041,739 )
(
20,122 )
(
374,318)
10,377,598
161,570

1,199,582
11,738,750
62,499
(
105,413)
11,695,836
207,583
158,368
(
500 )
(
447,763)
11,613,524
1,041,739

1,030
$ 12,656,293

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Statement 14

TAITA CHEMICAL CO., LTD.

STATEMENT OF MANUFACTURING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item Fuel expenses Salaries or bonuses Indirect material Depreciation expenses Others (Note)		Amount
		$ 328,087 301,932 215,423 163,087 191,053 $ 1,199,582

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

80 -

Statement 15

TAITA CHEMICAL CO., LTD.

STATEMENT OF SELLING AND MARKETING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item Freight and export expenses Others (Note)		Amount
		$ 826,497 84,113 $ 910,610

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

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Statement 16

TAITA CHEMICAL CO., LTD.

STATEMENT OF GENERAL AND ADMINISTRATIVE EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item Professional service expenses Salaries or bonuses Others (Note)		Amount
		$ 52,317 40,973 24,594 $ 117,884

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

82 -

Statement 17

TAITA CHEMICAL CO., LTD.

STATEMENT OF RESEARCH AND DEVELOPMENT EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Item Salaries or bonuses Research and development testing expenses Insurance expenses Others (Note)		Amount
		$ 12,313 2,409 1,268 2,556 $ 18,546

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

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Statement 18

TAITA CHEMICAL CO., LTD.

STATEMENT OF EMPLOYEE BENEFITS AND DEPRECIATION AND AMORTIZATION EXPENSES BY FUNCTION

for the Years Ended December 31, 2021 and 2020

(In Thousands of New Taiwan Dollars)

For the Year Ended December 31, 2021 Cost of Goods Sold Operating expenses Other gains and losses Total $ 437,893 $ 80,238 $ - $ 518,131 30,333 5,627 - 35,960 14,459 3,260 - 17,719 - 6,556 - 6,556 24,543 4,043 - 28,586 $ 507,228 $ 99,724 $ - $ 606,952 $ 163,087 $ 1,161 $ 3,372 $ 167,620 $ 1,600 $ 152 $ - $ 1,752	For the Year Ended December 31, 2021 Cost of Goods Sold Operating expenses Other gains and losses Total $ 437,893 $ 80,238 $ - $ 518,131 30,333 5,627 - 35,960 14,459 3,260 - 17,719 - 6,556 - 6,556 24,543 4,043 - 28,586 $ 507,228 $ 99,724 $ - $ 606,952 $ 163,087 $ 1,161 $ 3,372 $ 167,620 $ 1,600 $ 152 $ - $ 1,752	For the Year Ended December 31, 2021 Cost of Goods Sold Operating expenses Other gains and losses Total $ 437,893 $ 80,238 $ - $ 518,131 30,333 5,627 - 35,960 14,459 3,260 - 17,719 - 6,556 - 6,556 24,543 4,043 - 28,586 $ 507,228 $ 99,724 $ - $ 606,952 $ 163,087 $ 1,161 $ 3,372 $ 167,620 $ 1,600 $ 152 $ - $ 1,752	For the Year Ended December 31, 2021 Cost of Goods Sold Operating expenses Other gains and losses Total $ 437,893 $ 80,238 $ - $ 518,131 30,333 5,627 - 35,960 14,459 3,260 - 17,719 - 6,556 - 6,556 24,543 4,043 - 28,586 $ 507,228 $ 99,724 $ - $ 606,952 $ 163,087 $ 1,161 $ 3,372 $ 167,620 $ 1,600 $ 152 $ - $ 1,752	For the Year Ended December 31, 2020	For the Year Ended December 31, 2020	For the Year Ended December 31, 2020	For the Year Ended December 31, 2020	For the Year Ended December 31, 2020	For the Year Ended December 31, 2020
Cost of Goods Sold $ 437,893 30,333 14,459 - 24,543 $ 507,228 $ 163,087 $ 1,600	Operating expenses $ 80,238 5,627 3,260 6,556 4,043 $ 99,724 $ 1,161 $ 152	Other gains and losses $ - - - - - $ - $ 3,372 $ -		Cost of Goods Sold	Operating expenses $ 76,250 5,601 3,878 5,158 3,041 $ 93,928 $ 992 $ 442	Other gains and losses $ - - - - - $ - $ 5,344 $ -		Total
			$ $	$ 445,554 27,197 15,193 - 17,759 $ 505,703 $ 159,989 $ 1,600			5	$ 521,804 32,798 19,071 5,158 20,800 $ 599,631
			$						$ 166,32
			$						$ 2,042

84 -

Note:

The number of employees in 2021 and 2020 is 390 and 406, respectively, of which the number of directors who are not also employees is 7, which is calculated on the same basis as employee benefit expenses.
The average employee benefit expenses of the Company for the years ended December 31, 2021 and 2020 were $1,568 thousand and $1,490 －－

thousand respectively (“the amount of employee benefit expenses director’s total remuneration/number of employees number of directors who is not an employee”); The average salary expenses of the Company for the years ended December 31, 2021 and 2020 were $1,353 －

thousand and $1,308 thousand, respectively (the total salary expenses/ number of employees number of directors who is not an employee).

Change in average employee salary expense is 3.44% ((Average employee salary expense of the current year - Average employee salary expense of the previous year) / Average employee salary expense of the previous year).
The Company has established the Audit Committee. Therefore, there was no compensation to the supervisor for the years ended December 31, 2021 and 2020.
The Company's remuneration policy:
1) Director and managerial officers:
- (1) The remuneration of directors and managerial officers shall be given with reference to the prevailing standards of the same industry and in consideration of the reasonableness of the correlation between the company's business performance and future risks.
- (2) There shall be no incentive for the directors or managerial officers to pursue remuneration by engaging in activities that exceed the tolerable risk level of the Company.
- (3) The percentage of employee compensation for short-term performance and the timing of payment of some variable salary and compensation shall be determined by considering the characteristics of the industry and the nature of the Company's business.
2) Employees:
- The remuneration policy for employees is formulated with reference to government regulations, market conditions and dynamics of remuneration in the industry, changes in the overall economy and industry environment and the Company’s organizational structure. The payment standards are determined in accordance with the Company’s “Regulations on Salary Management”, “Regulations on Employee Performance Evaluation ” and “Regulations for the Distribution of Bonus for Supervisors”. In addition, the Company has established the "Regulations on Year-end Bonus" to provide year-end bonuses (including employee compensation) depending on the company's profitability and employee performance.

Explanation:

The information on the number of employees stated in the notes to this statement should be calculated on the same basis as employee benefit expenses and employee salary expenses, and should be calculated using the average number of employees.
In accordance with IAS 19, employees may provide services on a full-time, part-time, permanent, indefinite or temporary basis, including directors and other management personnel. Therefore, the term "employees" in this statement includes directors, managerial officers, employees and contract employees, but does not include supervisors, dispatched manpower, labor contractors or personnel from outsourced companies.
The term "remuneration of directors" refers to the remuneration, retirement benefits, directors' compensation and business execution expenses received by all directors, but does not include salaries, health insurance, pensions and other benefits received from serving as a part-time employee.

The term "compensation to the supervisor" refers to the remuneration, fees and operational expenses received by the supervisor.

85 -

AI assistant

TTC — Audit Report / Information 2021

51768_rns_2021-11-11_9d166464-3ae4-4969-8540-c9d224a05dd1.pdf

Taita Chemical Co., Ltd.

INDEPENDENT AUDITORS’ REPORT

Opinion

Basis for Opinion

Key Audit Matters

Authenticity of the Recognition of Sales Revenue from Customers of Specific Products

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

Auditors’ Responsibilities for the Audit of the Financial Statements

Notice to Readers:

TAITA CHEMICAL CO., LTD.

BALANCE SHEETS (In Thousands of New Taiwan Dollars) DECEMBER 31, 2021 AND 2020

Notice to Readers:

TAITA CHEMICAL CO., LTD.

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

(Continued from the previous page)

(Continued from the previous page)

Notice to Readers:

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

Notice to Readers:

TAITA CHEMICAL CO., LTD.

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

Notice to Readers:

TAITA CHEMICAL CO., LTD.

Notes to Financial Statements

1. GENERAL INFORMATION

2. APPROVAL OF FINANCIAL STATEMENTS

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

4. Summary of Significant Accounting Policies

b. Basis of preparation

e. Inventories

g. Investments in associates

Revenue from sale of goods

o. Borrowing costs

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Key Sources of Estimation Uncertainty

6. CASH AND CASH EQUIVALENTS

8. Financial assets at FVTOCI - non-current

－ 9. FINANCIAL ASSETS AT AMORTIZED COST CURRENT

December 31, 2021

b. Other receivables

11. Inventories

a. Investments in subsidiaries

b. Investments in associates

13. Property, plant and equipment

14. LEASE ARRANGEMENTS

b. Lease liabilities

15. INVESTMENT PROPERTIES, NET

16. INTANGIBLE ASSETS

17. BORROWINGS

18. ACCOUNTS PAYABLE

19. OTHER PAYABLES

20. REFUND PROVISIONS

21. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

b. Defined benefit plans

22. EQUITY

b. Capital surplus

d. Special reserve

e. Other equity items

23. REVENUE

24. PROFIT BEFORE INCOME TAX

25. INCOME TAX

b. Income tax recognized in other comprehensive income

Deferred tax

d. Deferred tax assets and liabilities

For the Year Ended December 31, 2021

For the Year Ended December 31, 2020

e. Income tax assessments

26. EARNINGS PER SHARE

Unit: NT$ Per Share

NET PROFIT FOR THE YEAR

27. CAPITAL MANAGEMENT

28. FINANCIAL INSTRUMENTS

Financial assets at FVTOCI - equity instruments

c. Categories of financial instruments

Sensitivity analysis

b) Interest rate risk

TTC Audit Report / Information 2021