TWM - Annual Report 2022 | FinancialReports.eu

Taiwan Mobile	Address	12F, No. 88, Yanchang Rd., Xinyi District, Taipei
	Telephone	(02) 6638-6888
	Customer Service	0809-000-852
	Website	www.taiwanmobile.com
Taiwan Mobile System Integration Branch Office	Address	8F, No.111, Dunhua S. Rd., Sec. 1, Da-an District, Taipei
	Telephone	(02) 6638-6888
Spokesperson	Name	George Chang
	Title	Vice President and Chief Financial Officer
	Telephone	(02) 6635-1880
	Email	[email protected]
Deputy Spokesperson	Name	Iris Liu
	Title	Vice President
	Telephone	(02) 6636-6979
	Email	[email protected]
IR Contact	Email	[email protected]
Audit Committee	Email	[email protected]
Stock Transfer Agent	Name	Transfer Agency and Registry Department of Fubon Securities Co., Ltd.
	Address	2F, No. 17, Xuchang St., Zhongzheng District, Taipei
	Telephone	(02) 2361-1300
	Website	www.fubon.com
Independent Auditor	Deloitte & Touche	Pei-De Chen, CPA, and Te-Chen Cheng, CPA
	Address	20F, No. 100, Songren Rd., Xinyi District, Taipei
	Telephone	(02) 2725-9988
	Website	www.deloitte.com.tw
Listing of Foreign Securities	None

Disclaimer

Please note that this English annual report is not a word-for-word translation of the Chinese version. In the event of any variance, the Chinese text shall prevail.

【 Letter to Shareholders 】 -------------------------------------------------------------------------------------------------------- 1 【 Chapter 1. Company Highlights 】 ------------------------------------------------------------------------------------------- 3 VISION ---------------------------------------------------------------------------------------------------------------------------- 3 CORE COMPETITIVENESS ------------------------------------------------------------------------------------------------------ 3 BRAND VALUES ------------------------------------------------------------------------------------------------------------------ 6 DATE OF INCORPORATION ------------------------------------------------------------------------------------------------------ 6 MILESTONES --------------------------------------------------------------------------------------------------------------------- 8 【 Chapter 2. Organization and Corporate Governance 】 -------------------------------------------------------------- 13 ORGANIZATION ----------------------------------------------------------------------------------------------------------------- 13 BOARD OF DIRECTORS AND EXECUTIVE MANAGEMENT ----------------------------------------------------------------- 18 COMPENSATION TO DIRECTORS AND MANAGEMENT EXECUTIVES ----------------------------------------------------- 35 CORPORATE GOVERNANCE -------------------------------------------------------------------------------------------------- 41 CERTIFIED PUBLIC ACCOUNTANT (CPA) INFORMATION ------------------------------------------------------------------ 76 INFORMATION ON CPA CHANGES -------------------------------------------------------------------------------------------- 77 COMPANY CHAIRMAN, PRESIDENT OR FINANCE/ACCOUNTING MANAGER HELD POSITIONS IN THE COMPANY’S AUDIT FIRM OR ITS AFFILIATES WITHIN THE PAST YEAR----------------------------------------------- 77 DIRECT AND INDIRECT INVESTMENTS IN AFFILIATED COMPANIES ------------------------------------------------------- 78 CHANGES IN SHAREHOLDINGS OF DIRECTORS, MANAGERS AND MAJOR SHAREHOLDERS ------------------------ 79 RELATIONSHIP BETWEEN TWM'S TOP 10 SHAREHOLDERS --------------------------------------------------------------81 【 Chapter 3. Financial Information 】 ----------------------------------------------------------------------------------------- 85 CAPITAL AND SHARES --------------------------------------------------------------------------------------------------------- 85 CORPORATE BOND ISSUANCE ----------------------------------------------------------------------------------------------- 88 PREFERRED SHARES ---------------------------------------------------------------------------------------------------------- 89 DEPOSITARY RECEIPT ISSUANCE -------------------------------------------------------------------------------------------- 89 EMPLOYEE STOCK OPTIONS AND NEW RESTRICTED EMPLOYEE SHARES ---------------------------------------------- 89 SHARES ISSUED FOR MERGERS AND ACQUISITIONS -------------------------------------------------------------------- 89 USE OF PROCEEDS FROM RIGHTS ISSUE ----------------------------------------------------------------------------------- 89 【 Chapter 4. Operational Highlights 】 --------------------------------------------------------------------------------------- 90 PERFORMANCE BY DIVISION ------------------------------------------------------------------------------------------------- 90 SCOPE OF BUSINESS ---------------------------------------------------------------------------------------------------------- 90 MARKET AND SALES OVERVIEW ---------------------------------------------------------------------------------------------- 98 HUMAN RESOURCES --------------------------------------------------------------------------------------------------------- 104 ENVIRONMENTAL PROTECTION EXPENDITURE --------------------------------------------------------------------------- 104 EMPLOYEE RELATIONS ------------------------------------------------------------------------------------------------------ 104 ICT SECURITY RISK MANAGEMENT ---------------------------------------------------------------------------------------- 108 MAJOR CONTRACTS --------------------------------------------------------------------------------------------------------- 109 【 Chapter 5. Financial Highlights 】 ----------------------------------------------------------------------------------------- 111 CONDENSED BALANCE SHEETS AND STATEMENTS OF COMPREHENSIVE INCOME --------------------------------- 111 FINANCIAL ANALYSIS --------------------------------------------------------------------------------------------------------- 114 AUDIT COMMITTEE REPORT ------------------------------------------------------------------------------------------------ 117 2022 CONSOLIDATED FINANCIAL STATEMENTS ------------------------------------------------------------------------- 118 2022 STAND-ALONE FINANCIAL STATEMENTS --------------------------------------------------------------------------- 118 FINANCIAL DIFFICULTIES FOR THE COMPANY AND ITS AFFILIATES ---------------------------------------------------- 118 【 Chapter 6. Review and Analysis of Financial Conditions, Operating Results and Risk Management 】 ------------------------------------------------------------------------------------------------------------------------------------ 119 BALANCE SHEET ANALYSIS ------------------------------------------------------------------------------------------------- 119 STATEMENTS OF COMPREHENSIVE INCOME ANALYSIS ----------------------------------------------------------------- 121 CASH FLOW ANALYSIS ------------------------------------------------------------------------------------------------------ 122 ANALYSIS OF MAJOR CAPEX AND ITS IMPACT ON FINANCE AND OPERATIONS -------------------------------------- 123 INVESTMENT POLICIES, REASONS FOR PROFIT/LOSS, PLANS FOR IMPROVEMENT, AND FUTURE INVESTMENT PLAN ----------------------------------------------------------------------------------------------------------- 123 RISK MANAGEMENT---------------------------------------------------------------------------------------------------------- 123 【 Chapter 7. Special Notes 】 -------------------------------------------------------------------------------------------------- 130 AFFILIATES -------------------------------------------------------------------------------------------------------------------- 130 PRIVATE PLACEMENT OF COMPANY SHARES ---------------------------------------------------------------------------- 140 TWM SHARES HELD / SOLD BY SUBSIDIARIES -------------------------------------------------------------------------- 140 OTHER SUPPLEMENTARY INFORMATION ---------------------------------------------------------------------------------- 140 OTHER SIGNIFICANT EVENTS AFFECTING SHAREHOLDERS’ EQUITY OR STOCK PRICE----------------------------140

Letter to shareholders

Dear Shareholders,

Over the last few years, Taiwan Mobile (“TWM”, or “the Company”) has endeavored to transform into a Telco+Tech company by continuously implementing 5G+ technology services on a first-rate telecom platform. We have seen encouraging results and created countless possibilities for a future lifestyle where the virtual world is integrated with reality. To further drive industry transformation and development, the Company will make use of its valuable spectrum resources, improve the efficiency of its mobile infrastructure, and promote energy conservation and carbon reduction. With the upcoming industry consolidation, TWM can reduce redundant base stations and have a positive impact on sector development and environmental sustainability. As always, we apply the highest standards in corporate governance, focus on shareholder value and customer satisfaction, and regard sustainable development as the core value of a leader in corporate social responsibility.

2022 operating and financial results

In 2022, TWM reported a record-high consolidated revenue of NT$172.2 billion, EBITDA of NT$34.4 billion, net profit of NT$11.0 billion and earnings per share of NT$3.91. Propelled by solid momentum from our three growth engines – 5G, e-commerce and home broadband – along with more stable competition in the telecom industry and well-managed costs and expenses, consolidated EBITDA grew 4% YoY, beating our full-year guidance and reaching an all-time high.

New business roadmap and group resources integration

In line with TWM’s new business roadmap, we have been growing our 5G ecosystem through strategic investments in various fields. Unique bundles such as momobile, in partnership with leading e-commerce platform momo, has helped the Company diversify its business ecosystem. We expanded Double Play package’s footprint, covering over 80% of households in Taiwan and allowing more users to enjoy our stable mobile and broadband services. TWM also launched a new brand called “OP Life,” a one-stop shop where TVs, routers, speakers and set-top boxes are seamlessly integrated with our unique services to provide customers with state-of-the-art home theater experiences. Looking at our game publishing business, we achieved another milestone by obtaining exclusive agency rights to the popular online game “League of Legends” in Taiwan. Meanwhile, the enterprise business saw accelerated demand for cloud-related services amid an ongoing digital transformation. To provide for our corporate clients’ needs, we partnered with Asia's leading AI and cloud service provider, CloudMile, to offer solutions built upon our edge in telecommunication and cloud-based services, as well as create high value-added services such as 5G cloud applications.

Innovative applications and research results

TWM is working with Nokia on several 5G network optimization solutions, such as 4G/5G dynamic spectrum sharing technology, to further leverage our advantage in the 700 MHz frequency band. This ensures superb overall internet experience for our more than 1 million 5G users and fulfills the various needs of our enterprise customers. Additionally, we joined hands with Taiwan Web Service (TWS), Intel and Asustek Computer to launch the “5G AI Ready Platform,” which showcases artificial intelligence high-performance computing (AIHPC) using TWM's 5G private network. High-performance computing can be used for multiple business solutions such as smart city AI image recognition, smart manufacturing, gaming, and digital innovation and transformation. Taiwan Computing Cloud (TWCC), a local public cloud we created with TWS, has also opened up endless possibilities for smart city applications by using its hybrid cloud resources and AI computing power to meet the needs of 5G applications, such as AI model development, real-time analysis and big data storage.

World-class corporate governance

Taiwan Mobile has striven to be a role model in corporate sustainability and is the first telecommunications company to elevate the “ESG Steering Committee” to the same level as its board of directors, further ensuring good governance. The Company once again received numerous commendations for its efforts in the past year. Recognized by the Carbon Disclosure Project (CDP), we are the only telecommunications company to make it to the climate change “A” list three times, and we received “leadership level” certification for four years in a row. Additionally, we grabbed the No. 1 spot in Taiwan and was No. 5 among Greater China companies in Chinese University of Hong Kong’s 2nd Greater China Business Sustainability Index. We were also included in the Dow Jones Sustainability Indices (DJSI) Emerging Markets Index for the 11th consecutive year and in the DJSI World Index for the sixth time, ranking top three in the global telecommunications industry. For eight years in a row, we have ranked among the top 5 percent listed companies in the Taiwan Stock Exchange’s annual “Corporate Governance Evaluation.” Lastly, TWM was awarded a Silver Class award in S&P Global’s “The Sustainability Yearbook 2022.”

Valuing shareholders' interests and customer satisfaction

We expect industry consolidation to lead to a healthier market. The expansion of our user base, along with merger synergies, will propel profit growth, generate stable free cash flow, increase financial flexibility, and improve shareholder returns.

Corporate social responsibility

As a leading telecom operator, it is our duty not only to continue to pursue solid operational and financial performance, but also to take into account social inclusion, environmental awareness and sustainability. In 2022, Taiwan Mobile was the first telecom operator in Taiwan to join RE100, committing to using 100% renewable energy by 2040 and officially declaring its goal of reaching Net Zero by 2050. Our efforts were recognized by different organizations in Taiwan, as we made it to the Annual Honor Roll of Global Views Monthly’s CSR and ESG Awards and won a "Model Award" in the Human Resources Development category. We also earned our 15th Excellence in Corporate Social Responsibility Award from CommonWealth Magazine , where we ranked first in the telecom industry for the seventh time. The Company earned further distinctions – seven awards at the 2022 Taiwan Corporate Sustainability Awards, including “The Most Prestigious Sustainability Awards – Top 10 Domestic Companies” for the eighth time.

Outlook

Enterprises are now at a crucial point in terms of addressing climate change and must transition to a lowcarbon economy. To achieve industrial transformation, companies must establish an internal governance program for ESG, adjust operational guidelines, communicate efforts and goals with stakeholders, and share climate-related financial disclosures. Continuous dialogue between industry, government and academia is also necessary to reach a consensus on the steps needed to move toward a more sustainable future.

The merger-driven industry consolidation, alongside our commitment to sustainability, will boost revenue growth and solidify Taiwan Mobile's competitive edge in the telecommunications sector, allowing us to promote 5G adoption and improve shareholder returns. We will also pursue our transformation into a regional Telco+Tech company at an accelerated pace while leveraging our excellent telecommunications service platforms to create group synergies and offer a wide variety of 5G+ applications.

Daniel M. Tsai Chairman

Chapter 1 Company Highlights

I. Vision

Leveraging its 26 years of experience, Taiwan Mobile has made big strides in the 5G era as it transitions from a traditional telecommunications firm into a Telco+Tech company. Propelling the Company’s advance is its integrated “5G+” Strategy: Gift (leveraging big data collected from the group’s 10 million user base); Group (creating maximum synergy through the integration of TFN Media, momo and AppWorks); Grit (implementing a 10 to 15-year long-term plan to develop a super 5G ecosystem); Green (a steadfast belief in cherishing Taiwan, humanity and the Earth); and GSEA (using Taiwan’s 5G ecosystem as a base for its expansion into the Greater Southeast Asian region). This has facilitated the Company’s embrace of new technologies and innovations to usher in Web3 era.

With “Open Possible” as its core brand spirit, Taiwan Mobile believes that imagination, technology, action, connectivity and inspiration are the keys to (1) providing customers with technological solutions, (2) empowering a comprehensive smart lifestyle, and (3) building the momo coin ecosystem to help achieve endless possibilities for its stakeholders. The Company has always adhered to the highest standards in managing its operations, undertaking innovation and integrating core resources to attain its goal of becoming a world-class company. Operating on the principle “Think Sustainable, Act Responsible,” Taiwan Mobile set up Zetta Connected 2030 standards for sustainable operations to meet the United Nations’ Sustainable Development Goals. In 2022, Taiwan Mobile formally joined the RE100 initiative on global climate change, pledging to use 100 percent renewable energy by 2040.

Looking ahead, Taiwan Mobile is hopeful that industry consolidation would eliminate price wars, allowing the telecommunications service sector to focus its resources on creating innovative applications. Taiwan Mobile officially signed an agreement to merge with Taiwan Star on December 30, 2021. The Company has been cooperating with government departments to expedite the review process. After the merger, the new Taiwan Mobile will use 5G carrier aggregation (NR CA) technology to combine the companies’ non-continguous 60MHz and 40MHz spectrum in the 3.5GHz band to provide a maximum 5G bandwidth of up to 100MHz. Spectrum efficiency will be significantly improved without having to build or install new equipment. Additionally, Taiwan Mobile would be able to save an estimated 100 million to 200 million kWh of electricity annually, contributing to international efforts to reduce global warming and benefitting the nation, society, industry and the environment.

With its commitment to corporate governance, environment sustainability and social inclusion, Taiwan Mobile aims to sharpen its global competitiveness while creating the highest value for stakeholders, employees and the general public.

II. Core Competitiveness

⚫ momo coin ecosystem to cement corporate synergy

Taiwan Mobile is the first telecommunications company in Taiwan to announce its transformation into a next-generation Telco+Tech company, offering users a convergence of Telecom, Internet, Media & Entertainment, and E-Commerce (T.I.M.E.) services. The Company is building a “Unity” platform for these services, deploying its 5G+ strategy to provide

users with technological solutions. Additionally, it is looking to develop a momo coin ecosystem, with the payment system serving as the link that ties all group services together to penetrate customers’ daily lives and provide them with more complete and convenient services.

⚫ Innovative multiple proprietary packages, Double Play and OP Life

Taiwan Mobile has long been an advocate of innovation, resource synergies and collaborations with partners in its ecosystem to design diversified 5G applications and enhance the user experience. Its unique “Double Play” project integrates mobile and fiber-optic broadband services to offer users more affordable packages. It has received positive feedback as subscribers can use mobile services on the go and 1Gbps+ WiFi 6 at home to enhance and upgrade their network experience. The Company has also blended content with hardware, internet and service to launch "OP Life" – a one-stop solution that offers users comprehensive media and gaming entertainment services. Furthermore, the Company offers a plethora of unique bundles, such as Disney+ and momobile, for users in search of a wider and richer mobile entertainment.

With an eye to breaking into the gaming market, Taiwan Mobile in 2020 aligned with Nvidia to create “GeForce NOW” to offer cloud gaming services. That was followed by its partnership with Logitech G to gain exclusive distribution rights to cloud gaming handheld devices. The Company is also the exclusive publisher of “League of Legends” in Taiwan, a worldrenowned game with over 180 million players. As for video and music streaming, the Company continues to invest in content production through its MyVideo and MyMusic units, while also serving as the exclusive telecommunications distributor of Disney+ in Taiwan, to offer users the best experience in film and music. In addition, Taiwan Mobile released a MyMoji 3D digital avatar service, providing users a personalized and diverse experience in the metaverse.

⚫ Strong corporate digital transition partner with expanding 5G ecosystem

Taiwan Mobile has played an active role in the digital transformation of corporations, offering a mixture of quality telecommunication services to help them develop their innovation capabilities. The Company assists its ecosystem partners with 5G usage, cloud services, IoT, cybersecurity and other creative applications. It teamed up with Taiwan Computing Cloud Center to form “TWCC AI cloud” – an AI technical R&D and cloud service platform to build an ecosystem to nurture a new generation of AI talent and facilitate cloud applications for enterprises. In another collaboration, the Company, together with Intel Corp and Asustek Computer Inc, set up a highly integrated cloud 5G private network for companies. This demonstrated that AIHPC using Taiwan Mobile's 5G private network environment has the capability to provide solutions for AI image identification, smart manufacturing, gaming, entertainment and smart cities, making it a force for propelling digital transformation and opening business opportunities. This year, Taiwan Mobile invested in Asia's leading AI cloud service provider, CloudMile, combining the benefits of telecommunication services and cloud product services to provide integrated solutions to enterprise customers and create added value through 5G applications. Taiwan Mobile also leads the industry in establishing a 5G testing ground in cooperation with Ming Chi University of Technology, Leo Systems Inc. and Nanya Institute of Technology to explore and demonstrate the innovative applications of 5G.

⚫ AI-supported infrastructure layout offers the best 5G user experience

Taiwan Mobile utilizes AI to analyze big data on customer demand and cell tower supplies to draft plans for the best layout

of its 5G cell towers. Using smart technologies to seek locations for its infrastructure, Taiwan Mobile became the first National Communications Commission approved telecommunications service provider to provide 5G coverage for 50 percent of the population, as well as the best 5G user experience in terms of phone call quality, media entertainment and gaming. Taiwan Mobile also has a trilateral collaboration with MediaTek and Nokia, with the trio successfully rolling out 5G NR CA connection under a 5G standalone network environment, marking the world's first combination of n28 (700MHz) and n78 (3.5GHz) frequencies that were utilized in tandem. The rollout was completed in the second half of 2022, with the low-frequency, high-speed system providing an amazing user experience. With the upcoming merger with Taiwan Star, Taiwan Mobile will have a maximum 100MHz bandwidth in the key 3.5GHz band. This will allow the company to further enhance the quality of its telecommunications network, providing outstanding services to its customers.

⚫ TWM Anti-phishing enhances cybersecurity to combat fraud

Thanks to its telecommunications and technological power, Taiwan Mobile has raised cybersecurity to a whole new level. TWM Anti-phishing, the first telecommunications service in Taiwan that can detect fake websites and apps, has assisted the Criminal Investigation Bureau in fighting fraud gangs on the front line. It has also helped enterprise customers install and implement cybersecurity measures. When fraud is suspected, the service immediately notifies the enterprise involved and assists it with handling reporting and applying protective measures. Taiwan Mobile continues to leverage group synergy to effectively combat fraud and safeguard society, personal data and property.

⚫ Building a happy workplace and nurturing interdisciplinary talent

Taiwan Mobile employees are partners in our sustainable growth, as well as the key to maintaining the Company’s core competitiveness. In 2022, the “Building a Happy Workplace Through Talent Development” recruitment and retention program launched the “TWM Human OS Upgrade v. 2022” plan. This centers on the concept of cherishing and respecting talent, developing employees’ multifold capabilities, helping them unlock their skills, and assisting them in planning their career path to create a force for innovation to welcome the new wave of Web3. Additionally, Taiwan Mobile launched the “Technology Guru Nurturing Internship Program” in the same year. This program recruits information technology students from around the world and provides them with a comprehensive mentor training system to help them become future technology experts. Furthermore, Taiwan Mobile is committed to creating a happy workplace, providing a diverse and inclusive employee-oriented friendly workplace and offering various welfare measures, including flexible hours (option of working 10 days from home per month) and raising the childbirth and child-rearing subsidies.

⚫ An ESG role model that prioritizes sustainability

Taiwan Mobile has long made sustainability a priority in its governance, as evidenced by its elevation of the ESG Steering Committee to a board-level committee to enhance the height and depth of corporate governance in the Company. Leveraging its core competencies in information and communications technology, Taiwan Mobile continues to enhance sustainability practices and collaborates with stakeholders to expand the influence of the Company. Taiwan Mobile's ESG performance has won top-tier rankings in the international community, including being selected in the prestigious DJSI World Index for six consecutive years and receiving an “A” certification from the Carbon Disclosure Project for its efforts to lower carbon emissions.

III. Brand Values

“Open Possible,” with its promise of doing what does not seem possible, inspires Taiwan Mobile to strive to open up new possibilities for its customers. Whether it’s connecting people or providing new perspectives, the Company aims to inspire and empower users to live smarter and more fulfilled lives. We integrate technologies into a new ecosystem and open up infinite possibilities for people to help them fulfill their wishes. By providing a new generation of solutions, we help every customer open up unlimited possibilities and reach greater heights.

Brand Spirit

We open up more possibilities for each customer through these four commitments:

⚫ Integration: Create an integrated platform to provide technological solutions to make lives more convenient, safer and healthier.
⚫ Intelligence: Leverage Taiwan Mobile's advantages, capabilities and data to build a smarter and connected system that can transcend physical and mental limitations.
⚫ Individuality: Customize products and services according to customers’ needs to give them better control and satisfaction.
⚫ Inspiration: Provide richer content to open up new thinking and perspectives for people.

Brand Personality

⚫ Optimistic: We are full of hope for the future and maintain an ever-optimistic attitude in facing various challenges.
⚫ Proactive: We always keep track of the latest trends, develop critical solutions and take concrete action.
⚫ Humanity: We develop technological innovations to provide customers with better services. We always put customers first, as their needs form the core of our work.

IV. Date of Incorporation

The Company was founded on February 25, 1997.

V. Significant Events

Status of mergers and acquisitions and affiliated companies

Refer to page 89 “Shares issued for mergers and acquisitions.”

Refer to page 130 “Affiliates.”

Changes in shareholdings of directors and major shareholders

Refer to page 79 “Changes in shareholdings of directors, managers and major shareholders.”

Other matters of material significance that could affect shareholders' equity and the Company: None

Awards and recognitions from 2022 up to the publication date in 2023


February	2023	Ranked among the top 5% in S&P Global’s “The Sustainability Yearbook 2023.”
December	2022	Earned top honors as an “A” certified company for the third year in a row from the Carbon Disclosure Project (CDP).
December	2022	Selected as a constituent of the Dow Jones Sustainability World Index for the sixth consecutive year, ranking among the top two in the telecommunication sector.
December	2022	Won seven awards at the 2022 National Store Manager Excellence Awards organized by the Taiwan Chain Stores and Franchise Association, with two Taiwan Mobile staffers receiving top honors as outstanding managers.
December	2022	Collaborated with National Cheng Kung University, J-MEX Inc. and Kaohsiung Veterans General Hospital to develop a “children’s sensory integration smart cloud,” which won the Enterprise Innovation Award at the National Industrial Innovations Awards.
November	2022	Won a Gold Sponsorship Award and a Long-Term Sponsorship Award at the Sports Administration’s Sports Benefactor Awards for the sixth straight year.
November	2022	Won a Top 10 Model Enterprises award at the Taiwan Corporate Sustainability Awards, as well as four individual awards for climate leadership, sustainable supply chain management leadership, talent development leadership and social inclusion leadership, in addition to a platinum award for its corporate sustainability report and a silver award for its global corporate sustainability report.
September	2022	Won an Excellence in Corporate Social Responsibility Award from_CommonWealth_ _Magazine_for the 15th time, with Taiwan Mobile ranking eighth among large enterprises and topping the list of telecommunication companies for the seventh time.
July	2022	Ranked fifth in the second edition of the Greater China Business Sustainability Index and first among Taiwan-based enterprises.
June	2022	Recognized as the No. 1 telecommunication company in Asia (excluding China) and named as one of the most respectable businesses by_Institutional Investor_magazine, with President Jaime Lin topping the list of Best Executive Officers, and Vice President/CFO Rosie Yu selected as the Best Financial Officer.


May	2022	Won an award at_Global Views_magazine's 2022 CSR and ESG Awards, making the Annual Honor Roll for the first time and garnering the Model Award in the Human Resources Development category.
April	2022	Ranked among the top 5% of companies that have undergone a Corporate Governance Evaluation for the eighth year in a row, and among the top 10% of companies with a market value of over NT$10 billion for the fourth straight year.
February	2022	Certified by SGS Qualicert for the 10th consecutive year.
February	2022	Received a Silver Award at S&P Global’s “The Sustainability Yearbook 2022.”

Milestones


February		The Board of Directors approved the adjustment of its share swap ratio for the merger with Taiwan Star Telecom Co., Ltd. and plans to issue 204 million Taiwan Mobile shares.
	2023


November		Gained exclusive distribution rights to the world's most popular game, “League of Legends,” in Taiwan.
	2022


November		Showcased new technology applications at IT Month, targeting the virtual business opportunities of Metaverse through its MyMoji digital avatar service.
	2022


October		Announced a NT$200 million investment into USPACE, making Taiwan Mobile its largest investor.
	2022


October		Launched the new brand “OP Life,” creating multiple layers of tailor-made entertainment for customers.
	2022


August		Teamed up with Taiwan Web Service Corp. (TWS), Intel Corp. and Asustek Computer Inc. to launch the “5G AI Ready Platform and Co-Lab” – the first cloud network integration platform for private enterprises in Taiwan.
	2022


May	2022	Board of Directors officially passed the Company’s Net Zero plan to fully eliminate greenhouse gas emissions by 2050, and submitted its science-based targets at the end of 2022.


May	2022	Formally established a board-level ESG Steering Committee and appointed the Company’s chairman as committee chairman and five independent directors as committee members to supervise all aspects of ESG decision-making.

May	2022	Participated in the 5G Private Network Exhibition in Asia at the New Bay Area in Kaohsiung, setting a precedent in the country by using a standalone network environment and displaying solutions to support smart patrols and cities.


March	2022	Presented Taiwan Computing Cloud platform services with strategic partner Taiwan Web Service to drive corporate digital transformation.

March	2022	Officially joined RE100 global initiative, pledging to fully use renewable energy by 2040.

March	2022	Invested in Asia's most advanced AI service supplier CloudMile, becoming an official strategic partner of the company, as well as securing a position on the board of CloudMile.


January	2022	Invested in SoundOn Global, making it the second-largest investor of the No. 1 audio entertainment brand in Taiwan.

December		Signed an official merger agreement with Taiwan Star Telecom Co., Ltd. via a share swap by issuing 282 million Taiwan Mobile shares to form a new 5G “Team Taiwan,” setting a new milestone in the nation’s 5G telecom development.
	2021


October	2021	Became the exclusive telecom distributor of Disney+ in Taiwan.


August		Teamed up with MediaTek and Nokia to conduct Taiwan’s first successful NR CA connection test in a 5G SA network environment; was the first company to aggregate the 700MHz (n28) and 3.5GHz (n78) frequencies.
	2021


August		Ventured into the Southeast Asian market by investing in Vietnamese e-commerce company TIKI.
	2021


July		Led the industry in responding to the Global Enabling Sustainability Initiative’s Digital with Purpose movement.
	2021


April		Received NCC certification that its 5G service has reached more than 50% of the country’s population.
	2021


August	2020	Teamed up with Nvidia to launch the GeForce Now cloud gaming platform in Taiwan.

August		Joined forces with Formosa Plastics Transport to develop 5G self-driving vehicles for industry and commerce.
	2020


June		Announced the start of its 5G service in Taiwan on June 30, and formally began offering the service on July 1; unveiled its new core brand spirit "Open Possible."
	2020


June	2020	Daniel M. Tsai was elected as Chairman at the 1st meeting of the ninth Board of Directors. More than 50% of the Board was made up of independent directors.
January	2020	Secured 60MHz of spectrum in the 3.5GHz band and 200MHz in the 28GHz band at a quantity bidding.
November	2019	Invested NT$600 million (US$20M) in AppWorks Fund III, making it a major investor of the VC fund.
August	2019	Hosted its first Circular Economy Forum, with Taiwan Mobile President Jamie Lin and 14 strategic partners signing a Circular Economy Cooperation Declaration.
July	2019	Built a 5G super league with nearly 100 high-tech business operators, making it the largest smart ecosystem in Taiwan.

January	2019	President James Jeng retired on March 31. At the 12th meeting, the 8th Board of Directors approved the appointment of Jamie Lin as president, effective April 1.
June	2018	Formed a National AI “A Team” with Asustek Computer and Quanta Computer.
December	2017	Teamed up with Taipei Fubon Bank to launch the first digital “red envelope” in Taiwan by integrating M+ Messenger and mobile internet banking to provide mobile payment via instant messenger.
November	2017	Received 3 million circuit numbers for IoT use from the National Communications Commission, thus officially beginning its IoT era.
October	2017	Taiwan Mobile and Fubon Group announced their strategic partnership with worldwide entertainment and sports agency Creative Artists Agency (CAA) Hollywood, CAA China and CMC Capital Partners, China’s leading media and entertainment investment and operating platform.
June	2017	Daniel M. Tsai and Richard M. Tsai were elected Chairman and Vice Chairman, respectively, at the 1st meeting of the eighth Board of Directors.
October	2016	Daniel M. Tsai and Richard M. Tsai were elected Chairman and Vice Chairman, respectively, at the 13th meeting of the seventh Board of Directors.
March	2016	Joined the Global e-Sustainability Initiative, making Taiwan Mobile the first Taiwanese and the third Asian firm to become a member.
February	2016	First Taiwanese telecom operator to showcase its SIM Management Platform and Global eSIM application at the Mobile World Congress.
March	2015	Acquired an additional license for 5MHz x 2 spectrum in the 700MHz band, making Taiwan Mobile the sole operator providing contiguous 20MHz LTE services in Taiwan.
August	2014	Awarded an 1800MHz license and became the first to adopt carrier aggregation in the 700/1800 frequency bands for LTE services.
June	2014	Launched 4G services in the 700MHz band.
June	2014	Richard M. Tsai and Daniel M. Tsai were re-elected Chairman and Vice Chairman, respectively, at the 1st meeting of the seventh Board of Directors.
January	2014	James Jeng was appointed President at the 16th meeting of the sixth Board of Directors.
November	2013	Taiwan Mobile’s internet data center (IDC), which received an Uptime Institute Tier III certification for design and construction, began operations.
October	2013	Won two 15MHz x 2 blocks in a 4G auction, one in the 700MHz (spectrum A4) band and another in the 1800MHz (spectrum C1) band.
November	2012	Launched mobile video service MyVideo.
May	2012	Launched instant messaging service M+ messenger.
August	2011	Capital reduction of NT$3.8bn.
June	2011	Richard M. Tsai and Daniel M. Tsai were re-elected Chairman and Vice Chairman, respectively, at the 1st meeting of the sixth Board of Directors.
April	2011	The Board of Directors approved the acquisition of a 51% stake in Fubon Multimedia Technology (also known as momo)for NT$8.35bn through Taiwan Mobile’s 100%-owned

		subsidiary Wealth Media Technology.
October	2010	Cliff Lai and Vivien Hsu were appointed Co-Presidents at the 17th meeting of the fifth Board of Directors, effective January 1, 2011.
May	2010	TFN Media Co., Ltd. (TFNM), a Taiwan Mobile affiliate, acquired a 45% stake in Taiwan Kuro Times Co., Ltd. TFNM raised its stake to 100% in August 2011.
January	2009	Founded Taipei New Horizon Co., Ltd. (a 49.9% holding) with Fubon Land Development Co., Ltd. to develop a cultural park at the site of the old Songshan tobacco plant under a 50-year BOT contract with the Taipei City Government.
September	2008	TransAsia Telecommunications (TAT) and Mobitai Communications were officially merged into Taiwan Mobile.
June	2008	Richard M. Tsai and Daniel M. Tsai were re-elected Chairman and Vice Chairman, respectively, at the 1st meeting of the fifth Board of Directors.
February	2008	Introduced three new brands – Taiwan Mobile, TWM Broadband and TWM Solution – to provide consumers, households and enterprises with integrated telecom services, including wireless communication, cable TV and fixed-line services.
December	2007	Company’s capital dropped to NT$38bn after a capital reduction of NT$12bn.
August	2007	Acquired a 45% stake in Taiwan Telecommunication Network Services Co., Ltd. (TTN). Taiwan Mobile raised its stake to 100% in August 2008 and merged TTN into Taiwan Fixed Network Co., Ltd. (TFN).
April	2007	Acquired an 84% stake in TFN. Taiwan Mobile acquired full ownership of TFN in December 2007.
January	2007	Launched 3.5G (HSDPA) services.
August	2006	Richard M. Tsai and Daniel M. Tsai were re-elected Chairman and Vice Chairman, respectively, at the 10th meeting of the fourth Board of Directors.
June	2005	Daniel M. Tsai and Richard M. Tsai were re-elected Chairman and Vice Chairman, respectively, at the 1st meeting of the fourth Board of Managing Directors.
May	2005	First in Taiwan to launch 3G (WCDMA) services.
November	2004	Joined the Bridge Mobile Alliance, the largest mobile alliance in Asia.
August	2004	Acquired a 67% stake in Mobitai, increasing its subscriber base to 8.2 million. Taiwan Mobile acquired full ownership of Mobitai in January 2006 and merged it into TransAsia Telecommunications in December 2007.
July	2003	Harvey Chang was appointed President and CEO at the 15th meeting of the third Board of Directors.
July	2003	Daniel M. Tsai and Richard M. Tsai were elected Chairman and Vice Chairman, respectively, at the 2nd meeting of the third Board of Managing Directors.
August	2002	Listed on the Taiwan Stock Exchange.
May	2002	C. S. Chen was appointed President at the 2nd meeting of the third Board of Directors.
April	2002	Jack T. Sun and Joseph Lee were re-elected Chairman and Vice Chairman, respectively, at the 1st meeting of the third Board of Directors.

February	2002	Granted a 3G license.
July	2001	Acquired a 95.62% stake in TransAsia Telecommunications (TAT), boosting its subscriber base to 6.42 million. Taiwan Mobile acquired full ownership of TAT in June 2006 and merged it into the Company in September 2008.
November	2000	Ray-Ying Fan was appointed President at the 8th meeting of the second Board of Directors.
September	2000	First private telecom operator to trade on Taiwan’s OTC market.
June	1999	Jack T. Sun and Joseph Lee were re-elected Chairman and Vice Chairman, respectively, at the 1st meeting of the second Board of Directors.
January	1998	Started commercial operations.
December	1997	First nationwide private operator to obtain a GSM 1800 network operating license.
February	1997	Company was incorporated.
January	1997	Jack T. Sun and Joseph Lee were elected Chairman and Vice Chairman, respectively, while Lai-Ting Zou was appointed President at the 1st meeting of the 1st Board of Directors.

Chapter 2 Organization and Corporate Governance

Organization

Organization Chart

As of February 25, 2023

Internal Audit Office E-Service Technology Division ERP Technology Division Channel Management Solutions Division Billing Solutions Division Data Analytics Technology Division Information Technology Infrastructure Division Call Center Solutions Division Accounting Division Operation Analysis Division Network Operations and Maintenance Div. – Northern I Network Management Division Radio Network Planning and Management Division Network Operations and Maintenance Div.`–`Northern II System Design Division Product Technology Division Network Engineering Division Network Operations and Maintenance Div.`–`Central Product Infrastructure Division Billing Management Division Investor Relations Division Finance Division Secretarial Division Procurement and Logistics Division Network Technical Support Division Network Operations and Maintenance Div.`–`Southern Shareholders Meeting Board of Directors Chairman President Risk Management Committee Audit Committee Remuneration and Nomination Committee Cyber Security and Data Privacy Protection Committee ESG Steering Committee Enterprise Business Group Home Business Group Acquisition and Loyalty Marketing Division Franchise Division Open Channel Sales Division Customer Service Division Direct Sales Div.–Northern I Region Direct Sales Div.–Northern II Region Direct Sales Div.–Central Region Devices and Accessories Division Direct Sales Div.–Southern Region Channel Strategy and Management Office Business Operations Management Division Integrated Marketing Communication and Membership Platform OP Experience Development Division Music Business Division Video Business Division Gaming Business Division Digital Media Division Mobile Commerce Division Data Science and Governance Office Occupational Safety and Health Office Small and Medium Enterprise Sales Division ICT and Personal Information Security Management Division Corporate Development Office Sustainability and Brand Development Division IoT and Platform Service Division Mobile Advertising Division Human Resources Division Administration Division Regulatory and Carriers Relations Division President's Office Legal Office Finance Group Information Technology Group Corporate Affairs Technology Group Consumer Business Group	Corporate Affairs	Corporate Affairs	Corporate Affairs
			President's Office
			Legal Office
			Regulatory and Carriers Relations Division
			Sustainability and Brand Development Division
			Corporate Development Office
			ICT and Personal Information Security Management Division
			Small and Medium Enterprise Sales Division
			Human Resources Division
			Administration Division
			Occupational Safety and Health Office
			Data Science and Governance Office
			IoT and Platform Service Division
			Mobile Advertising Division
			Mobile Commerce Division
			Digital Media Division
			Gaming Business Division
			Video Business Division
			Music Business Division
	Finance Group
			Accounting Division
			Billing Management Division
			Operation Analysis Division
			Investor Relations Division
			Finance Division
			Secretarial Division
			Procurement and Logistics Division
	Information Technology Group
			Channel Management Solutions Division
			Product Technology Division
			Billing Solutions Division
			Call Center Solutions Division
			Information Technology Infrastructure Division
			Data Analytics Technology Division
			ERP Technology Division
			E-Service Technology Division
	Technology Group
			Radio Network Planning and Management Division
			System Design Division
			Product Infrastructure Division
			Network Management Division
			Network Engineering Division
			Network Technical Support Division
			Network Operations and Maintenance Div. – Northern I
			Network Operations and Maintenance Div.`–`Northern II
			Network Operations and Maintenance Div.`–`Central
			Network Operations and Maintenance Div.`–`Southern
	Home Business Group

Divisional Scope of Responsibilities

Division	Division	Scope of responsibilities
Internal Audit Office		Conduct internal audit of the Company and its subsidiaries Handle employees’ and suppliers’ complaints Coordinate the operations of the Risk Management Committee
Corporate Affairs	President’s Office	Corporate strategic planning and implementation Develop new businesses and partnerships Facilitate cross-departmental collaboration and improve management mechanism Accelerate digital transformation and sourcing of innovative technologies
	Legal Office	Legal counsel, company litigation and legal document review
	Regulatory and Carriers Relations Division	Regulatory matters, government relations and intercarrier relations
	Sustainability and Brand Development Division	Sustainability and corporate social responsibility, brand management and sponsorships, public relations and TWM Foundation
	Data Science and Governance Office	Enhance efficiency and quality of data collection, definition, storage, management and application
	IoT and Platform Service Division	Study and develop IoT in healthcare and innovative platform service opportunities
	Mobile Advertising Division	Provide mobile advertising solutions based on big data analysis
	Mobile Commerce Division	Operate and manage postpaid and prepaid mobile online services, and integrate myfone shopping to offer customers more diverse choices Develop and manage mobile commerce for myfone online shopping, with a focus on 3C and Smarter Home merchandise myfone online shopping business development, strategic planning and operations
	Music Business Division	Oversee MyMusic business management, strategic planning, product development, marketing and operations
	Video Business Division	Oversee MyVideo business management, strategic planning, content and product development, marketing and operations
	Digital Media Division	Direct carrier billing service, international digital content subscription service, and VAS business development and operations
	Gaming Business Division	Game publishing, e-sports events and 5G cloud gaming platform operations
	Corporate Development Office	Evaluation of strategic investments
	ICT and Personal Information Security Management Division	ICT security and personal data and privacy protection Implementation of Cyber Security Management Act Operation of information security maintenance plan
	Small and Medium Enterprise Sales Division	Serve as hub of digital transformation for SMEs Enhance relations with selected partners to promote employee packages Explore business opportunities in SMEs‘ digitalization through in-house Communications Platform as a Service (CPaaS) and strategic partners’ Software as a Service(SaaS)
	Human Resources Division	Human resources planning and management Staffing, compensation/benefits and employee relations Employee training and development
	Administration Division	Office machinery and equipment management General and administrative affairs coordination Base station administration
	Occupational Safety and Health Office	Occupational safety and health management Workplace health promotion

Division		Scope of responsibilities
Finance Group	Accounting Division	Accounting information management Tax planning and compliance Preparation of financial reports
	Billing Management Division	Billing, receivables collection and settlement Credit check and risk management
	Operation Analysis Division	Operating performance analysis, capex/opex cost and benefit analysis, and financial forecasts/annual budget review
	Investor Relations Division	Maintain two-way communication between the Company and investors, including providing regular and timely disclosures of its operations, financial status, business strategy and development plans
	Finance Division	Treasury management Monitor investments and subsidiaries’ business activities Finance-related project evaluation, planning and execution
	Secretarial Division	Corporate governance affairs, board and shareholders’ meetings and corporate registration affairs Corporate share registrar management Company seal custodian and receipt/transmission of corporate documents
	Procurement and Logistics Division	Procurement policy and system planning Procurement-related activities and contract signing Supplier management
Information Technology Group	Channel Management Solutions Division	Sales, channel services and commission system solutions Fixed line information system solutions Payment service solutions
	Product Technology Division	Technical consultation and solutions analysis for innovative services and customer premises equipment (CPE) technologies Solutions design, systems development and delivery for innovative services and marketing promotions
	Billing Solutions Division	Billing systems operation and development
	Call Center Solutions Division	Call center solutions design, implementation and maintenance Portal design, implementation and maintenance
	Information Technology Infrastructure Division	Data center, systems and network infrastructure construction and operations management Implementation of information security policy
	Data Analytics Technology Division	Data analytics system solutions, including data warehouse, data science and business intelligence solutions Enterprise management information system solutions Customer relationship management system solutions
	ERP Technology Division	Enterprise resource planning (ERP) and human resources solutions Telecom network and inventory management system development IT governance related to software foundation architecture and development process
	E-Service Technology Division	E-commerce online shopping, Disney+, DCB website, Member Center platform, cloud gaming and e-sports social media platform system development and maintenance Fintech, BNPL OPPay, M+ messenger, OPBiz for small-and-medium business system development and maintenance Agile development, Center of Excellence team development

Division		Scope of responsibilities
Technology Group	Radio Network Planning and Management Division	Radio network strategy development and planning Site planning and performance management Radio network quality management
	System Design Division	Plan and design core, IP and transmission network systems for mobile and fixed networks Verification and testing of network elements
	Product Infrastructure Division	Design, implement and operate: - Cloud internet data center (IDC) - Cloud computing services: Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) Technology service infrastructure
	Network Management Division	24-hour supervision of mobile/fixed network management Technical support for customers with network quality issues Design and maintenance of network operation support systems
	Network Engineering Division	Mobile telecom and fixed-network business’ infrastructure budget, engineering and construction project outsourcing and progress control Applications for base station co-location, technical approvals and cable/conduit management for government agencies Fixed-network service management, project evaluation and coordination
	Network Technical Support Division	Technical support for mobile, fixed and IP-based networks
	Network Operations and Maintenance Division – Northern I, Northern II, Central and Southern Regions	Mobile and fixed network construction, expansion, operation, maintenance and optimization, including core, transmission and radio networks Network construction management and technical support
Consumer Business Group	Acquisition and Loyalty Marketing Division	Develop and execute strategies to acquire new customers, increase customer loyalty and lower churn rates for postpaid users Develop strategies for prepaid business Conduct market and customer analysis
	Integrated Marketing Communication and Membership Platform Division	Develop and manage Taiwan Mobile brand identity and brand strategy Develop and implement store signage and interior design, as well as brand and marketing communications, including above-the-line/below-the-line and online, social media, consumer event and store marketing communication activities Manage Company website to provide users with online services and operate membership platforms
	Devices and Accessories Division	Devices planning and management Accessories and revenue sources development Handset sales and distribution
	Customer Service Division	Customer service and call center management Telemarketing sales and customer retention
	Channel Strategy and Management Office	Channel strategy development and performance management Channel sales support, store display design, and in-store activities planning and execution Sales training program planning and service quality management
	Business Operations Management Division	Store operating system optimization and standards formulation Channel operation quality assurance to minimize corporate business risks Sales channel resources management and commission/awards calculation
	Franchise Division	Supervise franchisees’ product promotions, distribution and customer service
	Open Channel Sales Division	Open channel development, distribution and management of postpaid/prepaid products
	OP Experience Development Division	Strategy planning, product promotion and business management for smart home, new devices, customer service app and MyMoji App Online Merge Offline (OMO) user experience planning and execution to provide high-quality services through all devices

Division	Division	Scope of responsibilities
	Direct Sales Division – Northern I, Northern II, Central and Southern Regions	Product sales, customer service and project execution at company stores
Enterprise Business Group		Strategy development and business analysis Direct sales and channel development and customer relationship management Intercarrier relations and international business (including international roaming) planning and implementation
Home Business Group		Implement integrated technology solutions to develop new products and VAS Increase the penetration rate of video and broadband internet and overall revenue Expand two-way optical network to broaden coverage and ensure better internet access quality

Board of Directors and Executive Management

Board of Directors

The board of directors, acting on behalf of the Company’s shareholders, is charged with the task of supervising the management team. It is composed of nine directors – including five independent directors – who are well- known in the business, financial, telecommunications and information technology fields. The Audit Committee, composed entirely of independent directors, replaced board supervisors. Information on the Company’s Ninth Board of Directors is detailed below:

																	As of February25,2023	As of February25,2023	As of February25,2023	As of February25,2023
Title	Nationality	Name	Gender Age	Date elected	Term expires	Date first elected	Shareholding when elected		Current shareholding		Shareholding of spouse or minorchildren		Shareholding by nominee arrangement		Education and experience	Other positions	Executives, directors or supervisors who are spouses or within two degrees of kinship			Remark(s)
							Shares	`％`	Shares	`％`	Shares	`％`	Shares	`％`			Title	Name	Relationship
Chairman	R.O.C.	Fu Chi Investment Co., Ltd. Representative: Daniel M. Tsai	Male 61~70	2020. 06.18	2023. 06.17	1999. 06.22 *1999. 06.22	5,748,763	0.164	5,748,763 *65,162,715 (1)	0.163 *1.852	4,580,070	0.130	-	-	LLM, Georgetown University LLB, National Taiwan University Chairman, Fubon Financial Holding Co., Ltd. Chairman, Taipei Fubon Commercial Bank Co., Ltd. Chairman, Fubon Insurance Co., Ltd.	Chairman of ESG Steering Committee, Taiwan Mobile Co., Ltd. Director, Fubon Financial Holding Co., Ltd. Managing Director, Taipei Fubon Commercial Bank Co., Ltd. Chairman, Fubon Bank (Hong Kong) Ltd. Director, Fubon Bank (China) Co., Ltd. Chairman and President, Fubon Financial Holding Venture Capital Corp. Chairman, Fubon Sports and Entertainment Co., Ltd. Director, Fubon Stadium Co., Ltd. Chairman, Ming Dong Co., Ltd. Chairman, Dao Ying Co., Ltd. Chairman, Tien Chien Co., Ltd. Chairman, Ti Kun Co., Ltd. Chairman, Hsi Po Lai Co., Ltd. Chairman, Yi Fu So Co., Ltd. Chairman, Chung Shing Development Co., Ltd. Chairman, Fubon Realtors Co., Ltd. Director, Fubon Construction Co., Ltd. Chairman, Kuo Chi Investment Co., Ltd. Director, Leading Mark Ltd. Chairman, Dun Fu Co., Ltd. Director, Lucky Way Ltd. Director, Rainbow Cheer Ltd. Director, Key Gain Ltd. Director, Ultimate Epoch Ltd. Director, Orientland International Ltd. Director, Globotex International Ltd. Director, Cosgrove Global Ltd. Director, WTT Investment Ltd. Director, Star Top Ventures Co., Ltd. Director, Giver Concept Ltd. Director, Fame Dynasty Enterprises Ltd. Director, ABG-WTT Global Life Science Capital Partners GP Ltd. Chairman, momo.com Inc. Chairman, Taipei New Horizon Co., Ltd. Chairman, Taiwan Cellular Co., Ltd. Chairman, Wealth Media Technology Co., Ltd. Chairman, TWM Venture Co., Ltd. Chairman, Taiwan Fixed Network Co., Ltd. Director, Taiwan Teleservices & Technologies Co., Ltd. Chairman, TCC Investment Co., Ltd. Director, Taiwan Digital Service Co., Ltd. Chairman, Taihsin Property Insurance Agent Co., Ltd. Chairman, TFN Media Co., Ltd. Director, Win TV Broadcasting Co., Ltd. Chairman, TFN Union Investment Co., Ltd. Chairman,TCCI Investment and Development Co.,Ltd.	Director	Richard M. Tsai	Brother	`－`

Title	Nationality	Name	Gender Age	Date elected	Term expires	Date first elected	Shareholding when elected	Shareholding when elected	Current shareholding	Current shareholding	Shareholding of spouse or minorchildren	Shareholding of spouse or minorchildren	Shareholding by nominee arrangement	Shareholding by nominee arrangement	Education and experience	Other positions	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Remark(s)
							Shares	`％`	Shares	`％`	Shares	`％`	Shares	`％`			Title	Name	Relationship
Director	R.O.C.	Fu Chi Investment Co., Ltd. Representative: Richard M. Tsai	Male 61~70	2020. 06.18	2023. 06.17	1999. 06.22 *1999. 06.22	5,748,763	0.164	5,748,763 *93,310,663	0.163 *2.651	5,086,496	0.145	-	-	Honorary Doctorate of Engineering, Yang Ming Chiao Tong University Honorary Doctorate of Medicine, Taipei Medical University Honorary Doctorate of Business Administration, Fu Jen Catholic University MBA, Stern School of Business, New York University BBA, National Taiwan University Chairman, Fubon Securities Co., Ltd. Chairman, Taiwan Mobile Co., Ltd	Chairman, Fubon Financial Holding Co., Ltd. Chairman, Fubon Life Insurance Co., Ltd. Vice Chairman, Fubon Bank (Hong Kong) Ltd. Director, Ming Dong Co., Ltd. Director, Dao Ying Co., Ltd. Director, Tien Chien Co., Ltd. Director, Ti Kun Co., Ltd. Director, Hsi Po Lai Co., Ltd. Director, Yi Fu So Co., Ltd. Director, Chung Shing Development Co., Ltd. Director, Fubon Realtors Co., Ltd. Director, Fubon Construction Co., Ltd. Director, Kuo Chi Investment Co., Ltd. Director, Cho Pharma, Inc. Director, Carnegie Hall Corp. Director, Lucky Way Ltd. Director, Rainbow Cheer Ltd. Director, Key Gain Ltd. Director, Ultimate Epoch Ltd. Director, Orientland International Ltd. Director, Oceana Glory Ltd. Director, Eagle Legacy Ltd. Director, Globotex International Ltd. Director, Cosgrove Global Ltd. Director, Grandfull International Ltd. Director, WTT Investment Ltd. Director, Star Top Ventures Co., Ltd. Director, Castle Lion Investments Ltd. Director, Fame Dynasty Enterprises Ltd. Director, ABG-WTT Global Life Science Capital Partners GP Ltd. Director, TWM Venture Co., Ltd. Director, Taiwan Fixed Network Co., Ltd. Director, TCC Investment Co., Ltd. Director, TFN Union Investment Co., Ltd. Director, TCCI Investment and Development Co., Ltd.	Chairman Director	Daniel M. Tsai Chris Tsai	Brother Son	`－`

Title	Nationality	Name	Gender Age	Date elected	Term expires	Date first elected	Shareholding when elected	Shareholding when elected	Current shareholding	Current shareholding	Shareholding of spouse or minorchildren	Shareholding of spouse or minorchildren	Shareholding by nominee arrangement	Shareholding by nominee arrangement	Education and experience	Other positions	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Remark(s)
							Shares	`％`	Shares	`％`	Shares	`％`	Shares	`％`			Title	Name	Relationship
Director	R.O.C.	Fu Chi Investment Co., Ltd. Representative: Chris Tsai	Male 31~40	2020. 06.18	2023. 06.17	1999. 06.22 *2019. 05.01	5,748,763	0.164	5,748,763 *3,130,427	0.163 *0.089	-	-	-	-	BS in Economics, Wharton School of the University of Pennsylvania President and Director, Fubon Financial Holding Venture Capital Co., Ltd. Chairman and President, Fubon Sports and Entertainment Co., Ltd. Deputy Chairman, Shenzhen Teng Fu Bo Investment Co., Ltd. Coordinator of Innovation and Technology Office, Fubon Financial Holding Co., Ltd. Special Assistant to President, Fubon Life Insurance Co.,Ltd.	Deputy CIO of Investment Management Group and Vice President, Fubon Financial Holding Co., Ltd. Director, Fubon Life Insurance Co., Ltd. Director, momo.com Inc. Director, Taiwan Professional Basketball Development Co., Ltd. Director, Immanuel Investment Ltd. Director, AppWorks Ventures Director, Rhema International Ltd. Director, Eternal Hope Ltd. Director, Fubon Asset Management Co., Ltd. Supervisor, Levi Industrial Corp., Ltd. Supervisor, Mo Xi Industrial Corp., Ltd.	Director	Richard M. Tsai	Father	`－`
Director	R.O.C.	TCC Investment Co., Ltd. Representative: Jamie Lin (2)	Male 41~50	2020. 06.18	2023. 06.17	2009. 09.19 *2018. 06.12	200,496,761	5.713	200,496,761 *223,000	5.697 *0.006	-	-	-	-	MBA, Stern School of Business, New York University BS in Chemical Engineering with a minor in Economics, National Taiwan University Co-founder / Vice President of Products, Social Sauce Co-founder / General Manager of Greater China, lntumit	President, Taiwan Mobile Co., Ltd. Chairman, AppWorks Ventures Chairman, AppWorks Fund II Chairman, AppWorks Fund III Chairman, AppWorks Fund IV(TW) Admin Global Ltd. Chairman, Chen Feng Investment Chairman, Chen Yun Co., Ltd. Chairman, Chen Men Ltd. Director, AppWorks Ventures II Ltd. Director, AppWorks Ventures III Ltd. Director, AppWorks Fund IV Ltd. Director, AppWorks Fund IV Admin Global Ltd. Chairman, AppWorks School Co., Ltd. Director, Winbond Electronics Corp. Director, LINE Bank Taiwan Ltd. Director, 91APP, Inc. Director, Dcard Holdings Ltd. Director, EZTable, Ltd. Director, VIV3 Inc. Director, AWTH Ltd. Director, WeMo (Cayman) Corp. Director, WeMo Corp. Director, Bridge Mobile Pte Ltd. Director, momo.com Inc. Director, Taipei New Horizon Co., Ltd. Director and President, Taiwan Cellular Co., Ltd. Director and President, Wealth Media Technology Co., Ltd. Chairman, Fu Sheng Digital Co., Ltd. Chairman, Taiwan Teleservices & Technologies Co., Ltd. Chairman, Taiwan Digital Service Co., Ltd.	`－`	`－`	`－`	`－`

Title	Nationality	Name	Gender Age	Date elected	Term expires	Date first elected	Shareholding when elected	Shareholding when elected	Current shareholding	Current shareholding	Shareholding of spouse or minorchildren	Shareholding of spouse or minorchildren	Shareholding by nominee arrangement	Shareholding by nominee arrangement	Education and experience	Other positions	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Remark(s)
							Shares	`％`	Shares	`％`	Shares	`％`	Shares	`％`			Title	Name	Relationship
																Director, Taihsin Property Insurance Agent Co., Ltd. Director and President, TFN Media Co., Ltd. Chairman and President, Global Forest Media Technology Co., Ltd. Chairman and President, Global Wealth Media Technology Co., Ltd. Chairman and President, Taiwan Stampede Franchise Film Co., Ltd. Chairman, Win TV Broadcasting Co., Ltd. Chairman, Taiwan Kuro Times Co., Ltd. Chairman, Yeong Jia Leh Cable TV Co., Ltd. Chairman, Phoenix Cable TV Co., Ltd. Chairman, Union Cable TV Co., Ltd. Chairman, Globalview Cable TV Co., Ltd. Chairman, Taiwan Mobile Film Co., Ltd. President, TWM Venture Co., Ltd. President, Taiwan Fixed Network Co., Ltd. President, TCC Investment Co., Ltd. President, TFN Union Investment Co., Ltd. President, TCCI Investment and Development Co., Ltd.
Independent Director	R.O.C.	Hsueh-Jen Sung	Male 61~70	2020. 06.18	2023. 06.17	2014. 06.12	-	-	-	-	-	-	-	-	MBA, Harvard University MBA, National Chengchi University BS in Management Science, National Chiao Tung University Vice Chairman and Member of Global Partnership Committee and Asian Management Committee, Goldman Sachs (Asia) Ltd. President and CEO, Grand Cathay Securities Corp. Country Manager, Westpac Banking Corp.	Chairman of Audit Committee,Member of Remuneration and Nomination Committee and ESG Steering Committee, Taiwan Mobile Co., Ltd. Chairman, Song Quan Co., Ltd. Chairman, Vaucluse Capital Management Ltd.	`－`	`－`	`－`	`－`
Independent Director	R.O.C.	Char-Dir Chung	Male 61~70	2020. 06.18	2023. 06.17	2017. 06.14	-	-	-	-	-	-	-	-	PhD and MS in Electrical Engineering, University of Southern California BS in Electrical Engineering, National Taiwan University Minister without Portfolio, Executive Yuan Member / Deputy Convener / Executive Secretary, Board of Science and	Chairman of Remuneration and Nomination Committee, Member of Audit Committee and ESG Steering Committee, Taiwan Mobile Co., Ltd. Distinguished Professor, Department of Electrical Engineering and Graduate Institute of Communication Engineering, National Taiwan University Independent Director, Auden Techno Corp.	`－`	`－`	`－`	`－`

Title	Nationality	Name	Gender Age	Date elected	Term expires	Date first elected	Shareholding when elected	Shareholding when elected	Current shareholding	Current shareholding	Shareholding of spouse or minorchildren	Shareholding of spouse or minorchildren	Shareholding by nominee arrangement	Shareholding by nominee arrangement	Education and experience	Other positions	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Remark(s)
							Shares	`％`	Shares	`％`	Shares	`％`	Shares	`％`			Title	Name	Relationship
															Technology, Executive Yuan Member / Deputy Convener / Executive Secretary, National Information and Communications Initiative Committee, Executive Yuan Deputy Executive Secretary, Science and Technology Advisory Group, Executive Yuan Convener, Performance Evaluation Committee of Technology Development Program, Ministry of Economic Affairs IEEE Fellow SIS Chair Professor, National Taiwan University Chairman, Department of Communication Engineering, National Central University Director, Graduate Institute of Communication Engineering, National Central University
Independent Director	R.O.C.	Hsi-Peng Lu	Male 51~60	2020. 06.18	2023. 06.17	2019. 06.12	-	-	-	-	-	-	-	-	PhD in Industrial Engineering, University of Wisconsin Madison Dean, Management School, National Taiwan University of Science and Technology Dean, Honor College, National Taiwan University of Science and Technology Dean, Student Affairs Office, National Taiwan University of Science and Technology Chair, Department of Information Management, National Taiwan University of Science and Technology	Member of Audit Committee,Remuneration and Nomination Committee and ESG Steering Committee, Taiwan Mobile Co., Ltd. Professor, Department of Information Management, National Taiwan University of Science and Technology Independent Director, Yuen Foong Yu Investment Holding Co., Ltd. Independent Director, Shui-Mu International Co., Ltd. Independent Director, 91APP Inc.	`－`	`－`	`－`	`－`
Independent Director	Singapore	Tong Hai Tan	Male 51~60	2020. 06.18	2023. 06.17	2020. 06.18	-	-	-	-	-	-	-	-	BS in Electrical Engineering, National University of Singapore	Member of Audit Committee, Remuneration and Nomination Committee and ESG Steering Committee, Taiwan Mobile Co., Ltd. Director, SEAX Global Pte Ltd. (Singapore) Chairman, UnitedHampshire USREIT(Singapore)	`－`	`－`	`－`	`－`

Title	Nationality	Name	Gender Age	Date elected	Term expires	Date first elected	Shareholding when elected	Shareholding when elected	Current shareholding	Current shareholding	Shareholding of spouse or minorchildren	Shareholding of spouse or minorchildren	Shareholding by nominee arrangement	Shareholding by nominee arrangement	Education and experience	Other positions	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Executives, directors or supervisors who are spouses or within two degrees of kinship	Remark(s)
							Shares	`％`	Shares	`％`	Shares	`％`	Shares	`％`			Title	Name	Relationship
															President and CEO, StarHub Pte Ltd. (Singapore) President and CEO, Singapore Computer Systems Ltd. President and CEO, PacificInternetLtd	Director, Metis Energy Pte. Ltd. (Singapore)
Independent Director	U.S.	Drina Yue	Female 61~70	2020. 06.18	2023. 06.17	2020. 06.18	-	-	-	-	-	-	-	-	BS in Electrical Engineering, MS in Computer Science, University of Illinois Urbana-Champaign Independent Director, Gemalto President, Western Union Asia Managing Director, Motorola Asia Home and Networks Asia Senior Advisor, GSMA Advisory Board Member, Brambles & CHEP Asia CEO,iSteelAsia	Member of Audit Committee, Remuneration and Nomination Committee and ESG Steering Committee, Taiwan Mobile Co., Ltd. Director, Christian Action Asia Inc. Independent Director, Zhejiang Leapmotor Technology Co. Ltd.	`－`	`－`	`－`	`－`

Note: Zero shareholdings are denoted as “–”.

Date when the individual representative was first elected, his/her personal shareholdings, and percentage of personal shareholdings.

(1) 30,000,000 shares held in trust were not included.

(2) Jamie Lin was as an independent director from June 12, 2018 to February 11, 2019.

Major shareholders of TWM’s institutional investors

As of February 25, 2023

	As of February 25, 2023
Institutional investor	Major shareholders
Fu-Chi Investment Co., Ltd.	Richard M. Tsai (50.25%), Mei-Hui Ueng Tsai (49.75%)
TCC Investment Co., Ltd.	Taiwan Cellular Co., Ltd. (100%)

Major shareholders of companies mentioned on the right hand side of the table above

As of February 25, 2023

	As of February 25, 2023
Company	Major shareholders
Taiwan Cellular Co., Ltd.	Taiwan Mobile Co., Ltd. (100%)

2. Qualifications and independence criteria of directors

Name	CV (Qualifications and Experience)	Independence analysis (note)	No. of public companies in which he or she also serves as an independent director
Daniel M. Tsai	Mr. Daniel M. Tsai, the chairman of Fubon Group and Taiwan Mobile (TWM), possesses extensive experience in the fields of law, finance, fintech and business management. With Mr. Tsai spearheading TWM’s transition from a telecoms to a next- gen technology company, the Company has adopted a Super 5G strategy, creating synergies with cable TV giant Kbro, leading e-commerce retailer momo and start-up accelerator AppWorks, and developing a long-term Super 5G ecosystem and environmental sustainability to gain a foothold in Southeast Asia. Fubon Group’s business scope includes financial services, property, media, cable TV, e-commerce, cultural and creative industries, and charity. It includes three listed companies – Fubon Financial, TWM and momo – all of which are leaders in their respective fields. Mr. Tsai was recognized as an Outstanding Corporate Sustainability Professional at the Taiwan Corporate Sustainability Awards in 2017 and ranked 13th in_Harvard Business_ _Review’s_Taiwan’s top 100 best-performing CEOs in 2020. Mr. Tsai has a bachelor’s degree in law from National Taiwan University and a master’s degree in law from Georgetown University. He has been a member of the University of Southern California’s Board of Trustees since April 2012, a member of the Centre for Asian Philanthropy and Society’s Board of Governors since 2014 and chairman of the Asia Business Council’s Board of Trustees since March 2021.	1. Meets independence criteria Nos. 1, 6, 8, 9 and 11. 2. Serves as a juristic person representative of corporate shareholder Fu Chi Investment Co., Ltd., as well as chairman or director of the Company’s subsidiaries.	0

Name	CV (Qualifications and Experience)	Independence analysis (note)	No. of public companies in which he or she also serves as an independent director
Richard M. Tsai	Mr. Richard M. Tsai, the chairman of Fubon Financial Holding, is a veteran in the fields of finance, fintech and operation management. During his tenure as TWM’s chairman, he led the Company’s rise as a leader in digital convergence. Mr. Tsai was a recipient of the Asia Innovator Award at the 10th Asia Business Leaders Awards in 2011 – the only Taiwanese entrepreneur honored that year. He was also named on _Harvard Business Review's_Taiwan’s top 100 best-performing CEOs in 2016, and for four consecutive years (from 2017 to 2021) received an Asian Corporate Director Recognition Award at the Asian ESG Awards. Mr. Tsai has a bachelor’s degree in business administration from National Taiwan University and an MBA from New York University’s Stern School of Business. He is also a recipient of an honorary doctorate in business from Fu Jen Catholic University, an honorary doctorate in medicine from Taipei Medical University and an honorary doctorate in Engineering from Yang Ming Chiao Tong University. Mr. Tsai is a chair professor at National Taiwan University and National Yang-Ming University. He is also a member of the International Advisory Board of the New York Philharmonic, a director at Carnegie Hall Corp and a member of New York University’s President's Global Council, as well as the executive board of the university’s Stern School of Business.	1. Meets independence criteria Nos. 1, 6, 8, 9 and 11. 2. Serves as a juristic person representative of corporate shareholder Fu Chi Investment Co., Ltd., as well as director of the Company’s subsidiaries.	0
Chris Tsai	Mr. Chris Tsai, a graduate of The Wharton School of the University of Pennsylvania, has profound experience in finance, fintech and business management. He was a securities researcher at JPMorgan Chase in New York and holds a chartered financial analyst (CFA) license. After returning to Taiwan at the end of 2013, he joined Fubon Life Insurance Co., Ltd. and successively served as the chief investment officer, vice chairman and executive assistant to the president. At the same time, he took charge of developing Fubon's sports and new businesses. In 2014, he served as the president of Fubon Sports and Entertainment Co., Ltd., managing the Fubon Braves basketball team and the Fubon Guardians baseball team, bringing the concept of sports science into the teams, and leading Fubon Braves in winning its first championship in 2019.	1. Meets independence criteria Nos. 1, 3, 5, 6, 8, 9 and 11. 2. Serves as a juristic person representative of corporate shareholder Fu Chi Investment Co., Ltd., as well as director of the Company’s subsidiaries.	0

Name	CV (Qualifications and Experience)	Independence analysis (note)	No. of public companies in which he or she also serves as an independent director
Jamie Lin	Mr. Jamie Lin, who possesses extensive experience in finance, e-commerce technology, investment, mergers and acquisitions, and business management, is the president of TWM, as well as the chairman and a partner at AppWorks, which he founded in 2009. AppWorks, the largest start-up accelerator and one of the most active venture capital institutions in Southeast Asia, formed a strategic alliance with TWM in January 2019. Mr. Lin is also the founder of e-commerce start-up Hotcool, AI enterprise software start-up Intumit, travel community start-up Sosauce.com, and 3D game production start-up Muse Games in Taipei and New York. Mr. Lin has a BS in chemical engineering and a minor in economics from National Taiwan University, and obtained an MBA from New York University's Stern School of Business. Mr. Lin is also actively engaged in civil organizations that contribute to social progress. He is the managing director of the Taiwan Internet and E-Commerce Association, a co-convener of the Asia Silicon Valley Civil Advisory Committee and a member of the Executive Yuan's Digital Innovation and Governance Initiative Committee. Since 2009, he has regularly published articles on the MR JAMIE blog, providing inspiration to millions of readers around the world who are interested in starting a business.	1. Meets independence criteria Nos. 3, 4, 6, 8, 9, 10 and 11. 2. Serves as the president of the Company, juristic person representative of major corporate shareholder TCC Investment Co., Ltd., as well as chairman, director or president of the Company’s subsidiaries.	0
Hsueh-Jen Sung	Mr. Hsueh-Jen Sung is well-known for his expertise in the fields of finance, investment, mergers and acquisitions, and operations management. After graduating from National Chengchi University with an MBA, Mr. Sung received a Fulbright Scholarship for foreign students, which is awarded to only 10 people per year in Asia, and went on to obtain an MBA from Harvard University. Mr. Sung worked in financial centers such as Hong Kong, Tokyo and London. He served as the president of Grand Cathay Securities in 1992, and joined Goldman Sachs in 1994, becoming the first Taiwanese partner, executive director and principal of the Taiwan office in 1998. After retiring as vice chairman at Goldman Sachs Asia, Mr. Sung established an investment company. His numerous profitable investments are testaments to his unique and precise investment vision.	1. Meets independence criteria Nos. 1 to 12. 2. Has no direct or indirect interest in the Company, and meets the independence qualifications stipulated in Article 3 of the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies.	0

Name	CV (Qualifications and Experience)	Independence analysis (note)	No. of public companies in which he or she also serves as an independent director
Char-Dir Chung	Mr. Char-Dir Chung, a telecoms specialist, is a distinguished professor at National Taiwan University’s Department of Electrical Engineering and Telecommunications and a fellow of the International Society of Electrical and Electronics Engineers. A doctor of electrical engineering graduate from the University of Southern California, Mr. Chung’s expertise lies in communication systems and theory, wireless communication and spread spectrum communication. Mr. Chung has extensive experience in government. He was a minister without portfolio; member, deputy convener and executive secretary of the Board of Science and Technology of the Executive Yuan; member, deputy convener and executive secretary of the National Information and Communications Initiative Committee of the Executive Yuan, and deputy executive secretary of the Science and Technology Advisory Group of the Executive Yuan. He was also the convener of the Performance Evaluation Committee of the Ministry of Economic Affairs’ Technology Development Program. In academia, Mr. Chung was SIS chair professor at National Taiwan University, as well as chairman of National Central University’s Department of Communication Engineering and the director of its Graduate Institute of Communication Engineering.	1. Meets independence criteria Nos. 1 to 12. 2. Has no direct or indirect interest in the Company, and meets the independence qualifications stipulated in Article 3 of the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies.	1
Hsi-Peng Lu	Mr. Hsi-Peng Lu, an expert in the fields of e- commerce, information technology, fintech and operations management, is a distinguished professor at National Taiwan University of Science and Technology, an independent director of enterprises, and a newspaper and magazine columnist (Economic Daily News,MANAGER Today and_Scientific American_). His research covers e-commerce, internet marketing, Ubiquinomics, innovation management, strategy management, artificial intelligence and fintech, among others. A doctor of industrial engineering graduate from the University of Wisconsin-Madison, Mr. Lu was the former chairman of Liang Shing Eclife. He was also the dean of National Taiwan University of Science and Technology’s School of Management and Honors College, as well as head of the Department of Information Management. Mr. Lu served three times as a member of the evaluation committee for the R.O.C. Presidential Innovation Awards.	1. Meets independence criteria Nos. 1 to 12. 2. Has no direct or indirect interest in the Company and meets the independence qualifications stipulated in Article 3 of the Regulations Governing Appointment of Directors and Compliance Matters for Public Companies.	3

Name	CV (Qualifications and Experience)	Independence analysis (note)	No. of public companies in which he or she also serves as an independent director
Tong Hai Tan	Mr. Tong Hai Tan, an expert in the fields of communication, business, technology and operations management, is the executive director of SEAX Global Pte (Singapore). With more than 20 years of experience in the ICT industry, Mr. Tan had served as the CEO of StarHub Pte (Singapore), Singapore Computer Systems and Pacific Internet. During his tenure, he established numerous strategic partnerships with well-known enterprises, and was instrumental in transforming loss-making companies into profitable ones.	1. Meets independence criteria Nos. 1 to 12. 2. Has no direct or indirect interest in the Company and meets the independence qualifications stipulated in Article 3 of the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies.	0
Drina Yue	Ms. Drina Yue, who possesses extensive experience in the fields of communications, business, technology and operations management, is an independent director of Zhejiang Leapmotor Technology. Ms. Yue has been engaged in the communications industry for more than 40 years, serving as the director, president, vice president, chief of staff or senior adviser at Gemalto, Western Union, Motorola, GSMA, Brambles, CHEP, iSteelAsia, GTS and AT&T.	1. Meets independence criteria No. 1 to 12. 2. Has no direct or indirect interest in the Company, and meets the independence qualification stipulated in Article 3 of the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies.	0
Meets the conditions specified below within the past two years: Criterion 1: Not an employee of the Company or its affiliates Criterion 2: Not a director or supervisor of the Company or its affiliates (unless the person is an independent director of the Company, the Company’s parent company or any subsidiary of the Company) Criterion 3: Not a shareholder whose total holdings, including those of his/her spouse and minor children, or shares held under others’ names, reach or exceed 1 percent of the total outstanding shares of the Company or rank among the top 10 individual shareholders Criterion 4: Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of a manager under subparagraph 1 or any of the persons in the preceding two subparagraphs Criterion 5: Neither a director, supervisor, or employee of an entity that directly and/or indirectly holds more than 5% of the Company’s shares, nor one of the Company’s top five shareholders, or director, supervisor or employee of a corporate shareholder who appoints a representative as a director or supervisor of the Company in accordance with Article 27, paragraph 1 or 2 of the Company Act Criterion 6: Not a director, supervisor, or employee of a company in which the majority of board seats or voting shares is controlled by a person who also controls the same of the company Criterion 7: Not a director, supervisor, or employee of a company or institution in which the chairman, president (or equivalent) himself/herself or his/her spouse also serves as the company's chairman, president (or equivalent) Criterion 8: Not a director, supervisor, manager, or shareholder owning more than 5% of the outstanding shares of any company that has financial or business relations with the Company Criterion 9: Not a professional, owner, partner, director or supervisor, or officer of a sole proprietorship, partnership, company, or institution that provides auditing services to the Company or any affiliate of the Company, or that provides commercial, legal, financial, accounting or related services to the Company or any affiliate of the Company for which the provider in the past two years has received cumulative compensation exceeding NT$500,000, or a spouse thereof; this restriction does not apply to a member of the remuneration committee, public tender offer review committee, or specialcommittee for merger/consolidation and acquisition provided he/she exercises powers pursuant to the Securities and Exchange Act, the Business Mergers and Acquisitions Act or related laws or regulations.

Criterion 10: Not a spouse or relative within second degree by affinity to other directors

Criterion 11: Not in contravention of Article 30 of the Company Act

Criterion 12: Not an institutional shareholder or its representative pursuant to Article 27 of the Company Act

3. Board diversity and independence

TWM’s Corporate Governance Best Practice Principles call for the creation of a diverse board of directors. Directors concurrently serving as company officers shall not exceed one-third of the board. An appropriate policy on diversity based on the company's business operations, operating dynamics and development must be formulated and include, without being limited to, the following two guidelines:

Basic requirements: Gender, age, nationality and culture
Professional knowledge and skills: A professional background (e.g., law, accounting, industry, finance, marketing and technology), skills and industry experience

To meet the goals of corporate governance, board directors should possess the following abilities:

Operational decision-making
Accounting and financial analysis
Business management
Crisis management
Industry knowledge
A global market perspective
Leadership
Business decision-making

Specific management goals:

There should be at least one female director.
The board should have at least one member who is a specialist in telecommunication services, finance, law, business, technology, investment and M&A, fintech, information technology, risk management, operations management or e-commerce/ marketing.

Board members	Experience in telecommunication services industry (Years)	Tenure of directors/ independent directors (Years)				Top five core competencies	Top five core competencies	Top five core competencies	Top five core competencies	Top five core competencies
			Finance	Law	Business	Technology	Investment and M&A	Fintech	Information technology	Risk management	Operations management	E-commerce/ marketing
Daniel M. Tsai	24	24	V	V	V			V			V
Richard M. Tsai	24	24	V		V		V	V			V
Chris Tsai	4	4	V		V			V			V	V
Jamie Lin	8	5	V		V	V	V					V
Hsueh-Jen Sung	9	9	V		V		V	V			V
Char-Dir Chung	34	6				V			V	V	V	V
Hsi-Peng Lu	6	4				V		V	V		V	V
Tong Hai Tan	13	3			V	V			V	V	V
Drina Yue	33	3			V	V			V		V	V

Female director: 11.11%
Age of directors: 22.22% between 30 and 50 years old, 77.78% over 50 years old
Nationality: R.O.C. 77.78%, Singapore 11.11%, U.S. 11.11%

The board is composed of nine directors. Five are independent directors, constituting more than half of the board. A familial relationship within the second degree of kinship exists between the chairman, Daniel M. Tsai, and directors Richard M. Tsai and Chris Tsai. This does not contravene Article 26-3, paragraph 3 of the Securities and Exchange Act.

Management Team

Management Team
									As of February 25,2023
Title / Division	Nationality	Name	Gender	Effective date	Shareholding / %	Shareholding of spouse or minor children / %	Education and experience	Current position(s) in other companies	Manager is a spouse or consanguineous within two degrees
									Title	Name	Relationship
President	R.O.C.	Jamie Lin	Male	2019.04.01	223,000 0.006	-	MBA, Stern School of Business, New York University BS in Chemical Engineering with a minor in Economics, National Taiwan University Co-founder / Vice President of Products, Social Sauce Co-founder / General Manager of Greater China, lntumit	President, Taiwan Mobile Co., Ltd. Chairman, AppWorks Ventures Chairman, AppWorks Fund II Chairman, AppWorks Fund III Chairman, AppWorks Fund IV(TW) Admin Global Ltd. Chairman, Chen Feng Investment Chairman, Chen Yun Co., Ltd. Chairman, Chen Men Ltd. Director, AppWorks Ventures II Ltd. Director, AppWorks Ventures III Ltd. Director, AppWorks Fund IV Ltd. Director, AppWorks Fund IV Admin Global Ltd. Chairman, AppWorks School Co., Ltd. Director, Winbond Electronics Corp. Director, LINE Bank Taiwan Ltd. Director, 91APP, Inc. Director, Dcard Holdings Ltd. Director, EZTable, Ltd. Director, VIV3 Inc. Director, AWTH Ltd. Director, WeMo (Cayman) Corp. Director, WeMo Corp. Director, Bridge Mobile Pte Ltd. Director, momo.com Inc. Director, Taipei New Horizon Co., Ltd. Director and President, Taiwan Cellular Co., Ltd. Director and President, Wealth Media Technology Co., Ltd. Chairman, Fu Sheng Digital Co., Ltd. Chairman, Taiwan Teleservices & Technologies Co., Ltd. Chairman, Taiwan Digital Service Co., Ltd. Director, Taihsin Property Insurance Agent Co., Ltd. Director and President, TFN Media Co., Ltd. Chairman and President, Global Forest Media Technology Co., Ltd. Chairman and President, Global Wealth Media Technology Co., Ltd. Chairman and President, Taiwan Stampede Franchise Film Co., Ltd. Chairman, Win TV Broadcasting Co., Ltd. Chairman, Taiwan Kuro Times Co., Ltd. Chairman, Yeong Jia Leh Cable TV Co., Ltd. Chairman, Phoenix Cable TV Co., Ltd. Chairman, Union Cable TV Co., Ltd. Chairman, Globalview Cable TV Co., Ltd. Chairman, Taiwan Mobile Film Co., Ltd. President, TWM Venture Co., Ltd.	－	－	－

Title / Division	Nationality	Name	Gender	Effective date	Shareholding / %	Shareholding of spouse or minor children / %	Education and experience	Current position(s) in other companies	Manager is a spouse or consanguineous within two degrees	Manager is a spouse or consanguineous within two degrees	Manager is a spouse or consanguineous within two degrees
									Title	Name	Relationship
								President, Taiwan Fixed Network Co., Ltd. President, TCC Investment Co., Ltd. President, TFN Union Investment Co., Ltd. President, TCCI Investment and Development Co., Ltd.
Vice President and Chief Strategy Officer / Corporate Affairs	R.O.C.	Tim Lee	Male	2022.11.10	–	–	MBA, The Wharton School of University of Pennsylvania Vice President, Government of Singapore Investment Corp. Associate, ABN AMRO Research Executive, ACNielsen	Director, TWM Communications (Beijing) Co., Ltd. Director, Taiwan Mobile Film Co., Ltd. Director, Taiwan Stampede Franchise Film Co., Ltd. Director, Stampede Entertainment, Inc. Director, Nada Holdings, Inc. Director, Mistake Entertainment Co., Ltd. Supervisor, Uspace Tech Co., Ltd. Supervisor, Fu Sheng Digital Co., Ltd.	－	－	－
Vice President and Chief Data Officer / Corporate Affairs	R.O.C.	Eddie Chan	Male	2019.01.31	–	–	MBA, The Anderson School of Management, UCLA BS in Mechanical Engineering, National Taiwan University Senior Director, Taiwan Mobile Co., Ltd. Executive Director, Aplix Corp. General Manager, Wireless Business Unit, Quanta Computer Engagement Manager, McKinsey & Co.	None	－	－	－
Vice President / Corporate Affairs	R.O.C.	C.H. Wu	Male	2016.09.26	–	–	MS in Electrical and Computer Engineering, University of Rochester BS in Electrical Engineering, National Taiwan University Vice President, Applied Computing Group, Advantech Co., Ltd. General Manager, Taiwan, Symantec Corp. General Manager, Taiwan, Cisco Systems, Inc. System Engineer/Sales Manager, IBM Corp.	Officer-in-charge, System Integration Branch Office, Taiwan Mobile Co., Ltd. Chief Business Officer, Taiwan Fixed Network Co., Ltd. Chairman and President, Tai-Fu Cloud Technology Co., Ltd. Director, Taihsin Property Insurance Agent Co., Ltd. Director, Yeong Jia Leh Cable TV Co., Ltd. Director, Phoenix Cable TV Co., Ltd. Director, Union Cable TV Co., Ltd. Director, Globalview Cable TV Co., Ltd. Director, TWM Communications (Beijing) Co., Ltd. Director, Cloud Mile (Cayman) Inc. Director, Taiwan Web Service Corporation	－	－	－
Vice President / Corporate Affairs	R.O.C.	Luke Han	Male	2022.12.01	–	–	LLM, Soochow University BA in Management Science, Tamkang University Assistant Vice President, PChome Online Inc. General Manager, Pi Mobile Technology Inc. Manager, ChinaTrust Commercial Bank Manager, Bank SinoPac	President, Fu Sheng Digital Co., Ltd.	－	－	－
Vice President / Corporate Affairs	R.O.C.	Joan Hung	Female	2019.07.01	–	–	MS in HRD, Georgia State University Senior Director of Human Resources and Administration, Taiwan Mobile Co., Ltd. Senior Manager of Human Resources, Mobitai Communications Co., Ltd. Assistant Manager, Tsannkuen Co., Ltd.	None	－	－	－

Title / Division	Nationality	Name	Gender	Effective date	Shareholding / %	Shareholding of spouse or minor children / %	Education and experience	Current position(s) in other companies	Manager is a spouse or consanguineous within two degrees	Manager is a spouse or consanguineous within two degrees	Manager is a spouse or consanguineous within two degrees
									Title	Name	Relationship
Vice President / Corporate Affairs	R.O.C.	David Lin	Male	2016.05.03	–	–	MS in Communication Convergence and Innovative Management, Shih Hsin University General Manager, YMS/CPT/HTP/DWS CATV, Kbro Co., Ltd. Vice President, Business and Operations and Special Assistant to Chairman, Kbro Co., Ltd. Special Assistant to Chairman, Vibo Telecom Vice President, Asia Pacific Telecom	None	－	－	－
Vice President / Corporate Affairs	R.O.C.	Daphne Lee	Female	2014.07.07	–	–	MBA, National Chengchi University Director, Alibaba Group Director, Yahoo! Taiwan Vice President, Citibank Taiwan	Director and President, Taiwan Kuro Times Co., Ltd. Director and President, Taiwan Mobile Film Co., Ltd. Director, Taiwan Stampede Franchise Film Co., Ltd. Director, Nada Holdings, Inc. Director, Mistake Entertainment Co., Ltd.	－	－	－
Vice President / Corporate Affairs	R.O.C.	Iris Liu	Female	2014.07.14	–	–	EMBA, National Chengchi University BA in Information Communication, Tamkang University Vice President, Taiwan Television Enterprise Ltd. Chairman, TTV Cultural Enterprise Ltd.	Vice President, Taipei New Horizon Co., Ltd.	－	－	－
Vice President / Corporate Affairs	R.O.C.	Naomi Lee	Female	2015.08.03	–	–	LLB, National Taiwan University General Counsel, Kbro Co., Ltd. Attorney, InfoShare Tech Law Office Legal Director and Vice President, Taiwan Broadband Communications Senior Legal Manager, Lucent Technologies Attorney, Lee and Li Attorneys-at- Law Attorney, Russin & Vecchi International Legal Counselors	None	－	－	－
Vice President / Corporate Affairs	R.O.C.	Vincent Wu	Male	2022.08.01	–	–	MS Finance, Illinois Institute of Technology Vice President, BNP Paribas Cardif Chief Strategy Officer, Next Bank Vice President, Chailease Holding Co., Ltd. Vice President, CTBC Bank	None
Vice President and Chief Financial Officer / Finance Group	R.O.C.	George Chang	Male	2022.09.01				Director, momo.com Inc. Director, Global Forest Media Technology Co., Ltd. Director, Global Wealth Media Technology Co., Ltd. Director, Yeong Jia Leh Cable TV Co., Ltd. Director, Phoenix Cable TV Co., Ltd. Director, Union Cable TV Co., Ltd. Director, Globalview Cable TV Co., Ltd. Director, TWM Holdings Co., Ltd. Supervisor, Taiwan Cellular Co., Ltd. Supervisor, Wealth Media Technology Co., Ltd. Supervisor, TWM Venture Co., Ltd. Supervisor, Taiwan Fixed Network Co., Ltd.
							MBA, University of Southern California
							Chief Financial Officer, Egis Technology Inc.
							Director, FocalTech Systems Co., Ltd.
							Executive Vice President, Yuanta Consulting
							Director, Citigroup

Title / Division	Nationality	Name	Gender	Effective date	Shareholding / %	Shareholding of spouse or minor children / %	Education and experience	Current position(s) in other companies	Manager is a spouse or consanguineous within two degrees	Manager is a spouse or consanguineous within two degrees	Manager is a spouse or consanguineous within two degrees
									Title	Name	Relationship
								Supervisor, Taiwan Teleservices & Technologies Co., Ltd. Supervisor, TCC Investment Co., Ltd. Supervisor, Taiwan Digital Service Co., Ltd. Supervisor, TFN Media Co. Ltd. Supervisor, Win TV Broadcasting Co., Ltd. Supervisor, TFN Union Investment Co., Ltd. Supervisor, TCCI Investment and Development Co., Ltd. Supervisor, Taiwan Kuro Times Co., Ltd. Supervisor, TWM Communications (Beijing) Co., Ltd.
Vice President / Finance Group	R.O.C.	Jay Hong	Male	2004.05.06	–	–	EMBA, National Sun Yat-sen University President, Taiwan Teleservices & Technologies Co., Ltd. Vice President, Direct Store Division, Taiwan Mobile Co., Ltd. Vice President, Customer Service Division, TransAsia Telecommunications Inc. Director, Procurement Division, TransAsia Telecommunications Inc.	Supervisor, Yeong Jia Leh Cable TV Co., Ltd. Supervisor, Phoenix Cable TV Co., Ltd. Supervisor, Union Cable TV Co., Ltd. Supervisor, Globalview Cable TV Co., Ltd.	－	－	－
Vice President / Finance Group	R.O.C.	Shirley Chu	Female	2019.07.01	–	–	MBA, Fuqua School, Duke University BA Economics, National Taiwan University Director, Equity Research, UBS Analyst, Equity Research, Credit Lyonnais Securities (Asia)	None	－	－	－
Vice President and Chief Information Officer / Information Technology Group	R.O.C.	Rock Tsai	Male	2022.02.22	–	–	DBA, Central South University Executive Director and Head of Technology, DBS Taiwan Group CIO, Sinyi Realty Senior Vice President, HSBC China Executive Vice President and COO, G-Bridge Optoelectronics AVP, Citibank Taiwan EVP and Spokesman, Timenet Telecom	Director, Fu Sheng Digital Co., Ltd	－	－	－
Senior Vice President and Chief Technology Officer / Technology Group	R.O.C.	Tom Koh	Male	2019.07.25	–	–	PhD in Electrical and Computer Engineering, Johns Hopkins University Senior Director, Qualcomm Senior Technical Marketing Engineer, Cisco-Linksys Senior Sales Engineer, Ensemble Communications Senior Technologist, Motorola Member of Tech Staff, Bellcore	Director, Yeong Jia Leh Cable TV Co., Ltd. Director, Phoenix Cable TV Co., Ltd. Director, Union Cable TV Co., Ltd. Director, Globalview Cable TV Co., Ltd. Chairman and President, TWM Communications (Beijing) Co., Ltd.	－	－	－
Vice President / Technology Group	R.O.C.	Ming- Tung Wu	Male	2021.07.01	–	–	PhD in Electrical Engineering, National Taiwan University MS in Electrical Engineering, National Taiwan University Deputy Director, Taiwan Fixed Network Co., Ltd. Manager, Howin Technology Manager, Taiwan Fixed Network Co., Ltd. A.M., Suretone Telecom Inc.	None	－	－	－

Title / Division	Nationality	Name	Gender	Effective date	Shareholding / %	Shareholding of spouse or minor children / %	Education and experience	Current position(s) in other companies	Manager is a spouse or consanguineous within two degrees	Manager is a spouse or consanguineous within two degrees	Manager is a spouse or consanguineous within two degrees
									Title	Name	Relationship
Vice President and Chief Consumer Business Officer / Consumer Business Group	R.O.C.	Tony Lin	Male	2022.05.06	–	–	Vice President, AEON Motor Co., Ltd. Founder and CEO, NEXIT Technology Consultancy Channel Manager, NTT Taiwan Solutions Ltd.	Director, Uspace Tech Co., Ltd.	－	－	－
Vice President / Consumer Business Group	R.O.C.	Steve Chou	Male	2011.04.25	–	–	MBA, Southern Methodist University, Texas Senior Vice President, Customer Service, HSBC Bank General Manager, Secured Lending, Standard Chartered Bank Vice President, Customer Service, Sparq Telecom Vice President, Customer Service, TransAsia Telecommunications Inc. Assistant Vice President, Credit Card, Citibank, N.A.	President, Taiwan Teleservices & Technologies Co., Ltd.	－	－	－
Vice President / Consumer Business Group	R.O.C.	Kate Chen	Female	2021.07.01	–	–	MA in Advertising, Marquette University Director, TransAsia Telecommunications Inc A.M., D.Y.R A.M., Leo Burnett	President, Taiwan Digital Service Co., Ltd.	－	－	－

Note 1: Shareholdings of less than 0.001% are denoted as “0.000” and zero shareholdings are denoted as “–”.

Note 2: Shares purchased through the employee share ownership trust (ESOT) program are not included in the table.

Shares held by the management team through the ESOT program are listed as follows: Jamie Lin (3,902), Tim Lee (2,049), Eddie Chan (4,940), C.H. Wu (1,295), Joan Hung (7,699), David Lin (2,239), Daphne Lee (6,326), Iris Liu (3,643), Vincent Wu (371), George Chang (398), Jay Hong (14,870), Shirley Chu (694), Ming-Tung Wu (8,984), Rock Tsai (1,295), Tony Lin (1,183), Steve Chou (8,557), Kate Chen (1,295).

Unit: NT$

Compensation to Directors and Management Executives

1. Directors’ compensation

																							Unit: NT$
Title	Name	Representative			Directors’ compensation						A+B+C+D *as a % of net profit				Compensation as an employee						A+B+C+D+E+F+G *as a % of net profit		Compensation from investees other than subsidiaries
			Cash compensation (A)		Pension (B)		Director’s remuneration (C)		Professional fee (D)				Performance-based salary (E)		Retirement pay of employees (F)		Earnings paid as bonus to employees (G)
			Stand-alone	Consolidated	Stand-alone	Consolidated	Stand-alone	Consolidated	Stand-alone	Consolidated	Stand-alone	Consolidated	Stand-alone	Consolidated	~~S~~tand-alone	Consolidated	Stand-alone		Consolidated		Stand-alone	Consolidated
																	Cash	Stock	Cash	Stock
Chairman	Fu-Chi Investment Co., Ltd.	Daniel M. Tsai	48,736,400	59,352,580	-	-	12,237,43~~1 ~~	12,237,431	2,189,390	2,491,390	63,163,221 0.5729%	74,081,401 0.6719%	22,320,537	22,320,537	-	-	4,264,926	-	4,264,926	-	89,748,684 0.8140%	100,666,864 0.9130%	7,725,498
Director	Fu-Chi Investment Co.,Ltd.	Richard M. Tsai
Director	Fu-Chi Investment Co.,Ltd.	Chris Tsai
Director	TCC Investment Co.,Ltd.	Jamie Lin
Independent Director	Hsueh-Jen Sung		7,200,000	7,200,000	-	-	18,356,150	18,356,150	2,054,723	2,054,723	27,610,873 0.2504%	27,610,873 0.2504%	-	-	-	-	-	-	-	-	27,610,873 0.2504%	27,610,873 0.2504%	700,000
Independent Director	Char-Dir Chung
Independent Director	Hsi-Peng Lu
Independent Director	Tong Hai Tan
Independent Director	Drina Yue

Note 1: According to the Company’s Articles of Incorporation and the Rules for Setting Director’s Remuneration, directors’ remuneration is determined based on their duties, risks and involvement. The Remuneration and Nomination Committee reviews the compensation mechanism periodically.

Note 2: The figures in the table include expenses for company cars and gasoline reimbursement, but do not include compensation paid to company drivers, which totaled NT$763,298.

Note 3: In addition to the above table, remuneration paid to directors for their services to all consolidated entities (such as consultants who are not employees) totaled NT$3,464,062.

2. Range of compensation to directors

Range of compensation to directors	Name of directors	Name of directors	Name of directors	Name of directors
	Director’s compensation		Director’s compensation + Compensation as an employee
	On a stand-alone basis	On a consolidated basis	On a stand-alone basis	On a consolidated basis
NT$0~NT$999,999	Richard M. Tsai, Chris Tsai, Jamie Lin	Richard M. Tsai, Chris Tsai, Jamie Lin	Richard M. Tsai, Chris Tsai	Richard M. Tsai, Chris Tsai
NT$1,000,000~NT$1,999,999	－	－	－	－
NT$2,000,000~NT$3,499,999	TCC Investment Co., Ltd.	TCC Investment Co., Ltd.	TCC Investment Co., Ltd.	TCC Investment Co., Ltd.
NT$3,500,000~NT$4,999,999	－	－	－	－
NT$5,000,000~NT$9,999,999	Hsueh-Jen Sung, Char-Dir Chung, Hsi-Peng Lu, Tong Hai Tan, Drina Yue, Fu-Chi Investment Co., Ltd.	Hsueh-Jen Sung, Char-Dir Chung, Hsi-Peng Lu, Tong Hai Tan, Drina Yue, Fu-Chi Investment Co., Ltd.	Hsueh-Jen Sung, Char-Dir Chung, Hsi-Peng Lu, Tong Hai Tan, Drina Yue, Fu-Chi Investment Co., Ltd.	Hsueh-Jen Sung, Char-Dir Chung, Hsi-Peng Lu, Tong Hai Tan, Drina Yue, Fu-Chi Investment Co., Ltd.
NT$10,000,000~NT$14,999,999	－	－	－	－
NT$15,000,000~NT$29,999,999	－	－	Jamie Lin	－
NT$30,000,000~NT$49,999,999	－	－	－	Jamie Lin
NT$50,000,000~NT$99,999,999	Daniel M. Tsai	Daniel M. Tsai	Daniel M. Tsai	Daniel M. Tsai
NT$100,000,000 and above	－	－	－	－
Total	11	11	11	11

Unit: NT$

3. Management executives’ compensation

			Unit: NT$
Title and name	President, Jamie Lin; Senior Vice President and Chief Technology Officer, Tom Koh; Vice President and Chief Strategy Officer, Tim Lee;Vice President and Chief Data Officer, Eddie Chan; Vice President and Chief Financial Officer, George Chang; Vice President and Chief Information Officer, Rock Tsai; Vice President and Chief Consumer Business Officer, Tony Lin; Vice President, C.H. Wu; Vice President, Luke Han; Vice President, Joan Hung; Vice President, Jay Hong; Vice President, Shirley Chu; Vice President, Ming- Tung Wu; Vice President, Steve Chou; Vice President, Kate Chen; Vice President, David Lin; Vice President, Daphne Lee;Vice President, Iris Liu; Vice President, Naomi Lee; Vice President, Vincent Wu Resigned managers: Executive Vice President and Chief Financial Officer, Rosie Yu; Vice President, Michael Teng		Total
Salary (A)	Stand-alone		103,541,031
	Consolidated		104,021,031
Pension (B) *	Stand-alone		1,958,100
	Consolidated		1,958,100
Performance-based salary (C)	Stand-alone		75,117,076
	Consolidated		75,502,780
Earnings paid as bonus to employees (D)	Stand-alone	Cash	29,534,397
		Stock	`－`
	Consolidated	Cash	29,534,397
		Stock	`－`
A+B+C+D *as a % of net profit	Stand-alone		210,150,604 *1.9060%
	Consolidated		211,016,308 *1.9139%
Compensation from investees other than subsidiaries			7,619,844

Note 1: The Company’s contribution to employees’ pension account, not actual amount paid.

Note 2: Figures do not include compensation paid to company drivers, which totaled NT$2,012,646.

4. Range of compensation to management executives

Range of compensation to management executives	Name of management executives	Name of management executives
	On a stand-alone basis	On a consolidated basis
NT$0~NT$999,999	`－`	`－`
NT$1,000,000~NT$1,999,999	`－`	`－`
NT$2,000,000~NT$3,499,999	Luke Han, Vincent Wu	Luke Han, Vincent Wu
NT$3,500,000~NT$4,999,999	`－`	`－`
NT$5,000,000~NT$9,999,999	Eddie Chan, George Chang, Tony Lin, C.H. Wu, Joan Hung, Jay Hong, Shirley Chu, Ming-Tung Wu, Steve Chou, Kate Chen, David Lin, Daphne Lee, Iris Liu , Naomi Lee, Michael Teng	Eddie Chan, George Chang, Tony Lin, C.H. Wu, Joan Hung, Jay Hong, Shirley Chu, Ming-Tung Wu, Steve Chou, Kate Chen, David Lin, Daphne Lee, Iris Liu , Naomi Lee, Michael Teng
NT$10,000,000~NT$14,999,999	Rosie Yu, Tom Koh, Rock Tsai	Rosie Yu, Tom Koh, Rock Tsai
NT$15,000,000~NT$29,999,999	Jamie Lin , Tim Lee	Tim Lee
NT$30,000,000~NT$49,999,999	`－`	Jamie Lin
NT$50,000,000~NT$99,999,999	`－`	`－`
NT$100,000,000 and above	`－`	`－`
Total	22	22

Note: Compensation paid to managers in the above table was based on tenure they served in 2022. Compensation paid to managers who also served as directors is detailed in the “Directors’ compensation” table.

5. Compensation mix of management executives

Title and name	Salary and pension	Performance-based salary	Earnings paid as bonus to employees
President, Jamie Lin	37.0%	47.0%	16.0%
Executive Vice President and Chief Financial Officer, Rosie Yu*	80.0%	20.0%	0.0%
Senior Vice President and Chief Technology Officer, Tom Koh	47.5%	35.1%	17.4%
Vice President and Chief Strategy Officer, Tim Lee	50.3%	32.8%	16.9%
Vice President and Chief Data Officer, Eddie Chan	48.1%	35.6%	16.3%
Vice President and Chief Financial Officer, George Chang	50.3%	32.7%	17.0%
Vice President and Chief Information Officer, Rock Tsai	40.2%	46.4%	13.4%
Vice President and Chief Consumer Business Officer,Tony Lin	47.7%	33.6%	18.7%
Vice President, C.H. Wu	49.1%	34.6%	16.3%
Vice President, Luke Han	15.5%	79.2%	5.3%
Vice President, Joan Hung	42.8%	41.7%	15.5%
Vice President, Jay Hong	54.9%	32.3%	12.8%
Vice President, Shirley Chu	48.7%	34.8%	16.5%
Vice President, Ming-Tung Wu	48.2%	35.5%	16.3%
Vice President, Steve Chou	55.1%	32.0%	12.9%
Vice President, Kate Chen	48.1%	35.6%	16.3%
Vice President, David Lin	48.7%	36.3%	15.0%
Vice President, Daphne Lee	49.4%	35.5%	15.1%
Vice President, Iris Liu	49.5%	35.4%	15.1%
Vice President, Naomi Lee	51.1%	33.2%	15.7%
Vice President, Vincent Wu	49.2%	35.8%	15.0%
Vice President, Michael Teng*	85.2%	14.8%	0.0%

Resigned

6. Employee profit sharing paid to management executives

Unit: NT$

Title and name President, Jamie Lin Senior Vice President and Chief Technology Officer, Tom Koh Vice President and Chief Strategy Officer, Tim Lee Vice President and Chief Data Officer, Eddie Chan Vice President and Chief Financial Officer, George Chang Vice President and Chief Information Officer, Rock Tsai Vice President and Chief Consumer Business Officer,Tony Lin Vice President, C.H. Wu Vice President, Luke Han Vice President, Joan Hung Vice President, Jay Hong Vice President, Shirley Chu Vice President, Ming-Tung Wu Vice President, Steve Chou Vice President, Kate Chen Vice President, David Lin Vice President, Daphne Lee Vice President, Iris Liu Vice President, Naomi Lee Vice President, Vincent Wu	Stock bonus	Cash bonus	Total	As a % of net profit
	-	29,534,397	29,534,397	0.2679%

Compensation of directors and management executives as a percentage of net income over the past two years and guiding principles

1. Directors’ compensation

Unit: NT$

				Unit: NT$
Type	Year	Directors’ compensation	Net income	As a % of net income
On a stand-alone basis	2021	121,639,846	10,988,164,899	1.1070%
	2022	117,359,557	11,025,550,663	1.0644%
On a consolidated basis	2021	129,055,258	10,988,164,899	1.1745%
	2022	136,703,235	11,025,550,663	1.2399%

Guiding principles for compensation of directors

Remuneration policies, standards and package

(1) Directors’ (including independent directors) remuneration and compensation are paid according to the Company’s Articles of Incorporation and Rules for Setting Director’s Remuneration as approved by the board. Remuneration or other equivalent allowance for directors is based on their involvement in the Company’s operations, contribution to the Company and industry norms. Compensation paid to directors is pursuant to the ratio specified in the Company’s Articles of Incorporation, when the company makes a profit.
(2) Transportation allowances are paid based on attendance in board meetings and for services rendered as the chairman or a member of the Audit Committee, Remuneration and Nomination Committee or ESG Steering Committee.

Procedures for setting remuneration

(1) In accordance with the Company’s Articles of Incorporation, compensation paid to directors shall not exceed 0.3% of the Company’s annual profit after deducting losses from previous years.
(2) Directors’ remuneration and transportation allowances are determined in accordance with the Rules for Setting Director’s Remuneration.

Performance factor

According to the Company’s Articles of Incorporation, directors’ remuneration shall be based on the Company’s operating profit. Directors’ remuneration is assessed based on their contribution to the operations of the Company and the board. The Company also has Rules for Setting Director’s Remuneration, and the Remuneration and Nomination Committee reviews the compensation mechanism periodically, taking future operating risks, environmental conservation and sustainable development into consideration.

2. Compensation of management executives

Unit: NT$

Type	Year	Compensation of management executives	Net profit	As a % of net profit
On a stand-alone basis	2021	177,056,511	10,988,164,899	1.6113%
	2022	210,150,604	11,025,550,663	1.9060%
On a consolidated basis	2021	184,016,627	10,988,164,899	1.6747%
	2022	218,636,152	11,025,550,663	1.9830%

Guiding principles for compensation of management executives

Remuneration policies, standards and package

(1) Compensation paid to the president and vice presidents comprises a fixed monthly salary and performance bonus. (2) Performance bonuses are determined based on the president’s or the vice president’s contribution to the Company and the results of an annual performance appraisal. The above-mentioned bonuses have been proposed by the Remuneration and Nomination Committee for approval at the board meeting.

Procedures for setting performance bonuses

(1) In accordance with the Company’s Articles of Incorporation, employee profit sharing shall come from a pool of 1% to 3% of the Company’s annual net income after deducting losses from previous years.
(2) Year-end bonuses are set based on the Company’s performance and the annual budget approved by the board and the chairman.

Performance factor

(1) Variable compensations in the form of employee profit sharing and performance-based bonuses account for approximately 40% to 50% of the remuneration and are determined based on the president’s or vice president’s contribution to the Company’s operations. The Company shall review the compensation mechanism periodically, taking future operating risks, environmental conservation and corporate sustainable development into consideration. To strengthen the link between corporate sustainable development and managers’ compensation, if the president or vice president fails to meet all ESG metrics, his/her annual performance ranking may drop by one level, or his/her employee profit sharing and performance-based bonus may be cut by up to 10%.
(2) The Human Resources Division is tasked with preparing the annual compensation for the president and vice presidents, and submitting a report to the Remuneration and Nomination Committee.

Corporate Governance

Board of Directors attendance

The Board of Directors convened six meetings in 2022

Title	Name	Attendance inperson	Attendance ratio	Remarks
Chairman	Fu Chi Investment Co., Ltd. Representative: Daniel M. Tsai	6	100%	None
Director	Fu Chi Investment Co., Ltd. Representative: Richard M. Tsai	6	100%	None
Director	Fu Chi Investment Co., Ltd. Representative: Chris Tsai	6	100%	None
Director	TCC Investment Co., Ltd. Representative: Jamie Lin	6	100%	None
Independent Director	Hsueh-Jen Sung	6	100%	None
Independent Director	Char-Dir Chung	6	100%	None
Independent Director	Hsi-Peng Lu	6	100%	None
Independent Director	Tong Hai Tan	6	100%	None
Independent Director	Drina Yue	6	100%	None

1. Any objections or issues raised by independent directors against resolutions passed by the Board of Directors:

(1) Pursuant to Article 14-3 of the Securities and Exchange Act:

Not applicable. The Company has already established an audit committee.

(2) Other items not covered in the preceding table: None

2. Any recusals due to conflicts of interest:

Date	Name of directors	Proposal	Reasons for recusal	Participation in deliberation
2022.01.25	Daniel M. Tsai Richard M. Tsai Jamie Lin	2021 performance evaluation and proposed year-end bonuses for chairman, managers and audit supervisor by the Remuneration andNominationCommittee	Daniel M. Tsai and Jamie Lin: Personal interest Richard M. Tsai: Interested party	All three were excluded from the deliberations
2022.02.22	Jamie Lin	2022 Balanced scorecard for president	Personal interest	Mr. Lin was excluded from the deliberations
	Daniel M. Tsai Richard M. Tsai Chris Tsai	Acquisition or disposal of right-of-use assets	Richard M. Tsai: Personal interest Daniel M. Tsai and Chris Tsai: Interested party	All three were excluded from the deliberations
2022.05.06	Richard M. Tsai Chris Tsai	Removal of non-competition restrictions for board members	Chris Tsai: Personal interest Richard M. Tsai: Interested party	Both were excluded from the deliberations
	Daniel M. Tsai Richard M. Tsai Chris Tsai	Acquisition or disposal of right-of-use assets	Richard M. Tsai: Personal interest Daniel M. Tsai and Chris Tsai: Interested party	All three were excluded from the deliberations
2022.08.01	Daniel M. Tsai Richard M. Tsai Jamie Lin	Distribution of 2021 bonuses and adjustment of 2022 remuneration for the Company’s chairman, managers and audit supervisor	Daniel M. Tsai and Jamie Lin: Personal interest Richard M. Tsai: Interested party	All three were excluded from the deliberations
2022.11.10	Jamie Lin	Investment in AppWorks Fund IV L.P. through 100%-owned TWM Venture Co., Ltd.	Personal interest	Mr. Lin was excluded from the deliberations
	Daniel M. Tsai Richard M. Tsai Chris Tsai	Acquisition or disposal of right-of-use assets	Richard M. Tsai: Personal interest Daniel M. Tsai and Chris Tsai: Interested party	All three were excluded from the deliberations

3. Information regarding the implementation of the evaluation of the BoD and functional committees

Evaluation frequency	Evaluation period	Evaluation scope	Evaluation measures	Evaluation measures
Once a year	Jan. 2022 to Dec. 2022	Performance evaluation of the board as a whole, individual directors and functional committees	1. Evaluation of the performance of the board of directors (1) Participation in the operations of the company (2) Improvement in the quality of decision-making (3) Composition and structure of the board (4) Election and continuing education of directors (5) Internal controls (6) Participation in corporate social responsibility 2. Self-evaluation by individual directors (1) Alignment with the goals and missions of the company (2) Awareness of the duties of a director (3) Participation in the operations of the company (4) Management of internal relationships and communication (5) Professionalism and continuing education of directors (6) Internal control 3. Self-evaluation by Functional Committees: (1) Participation in the operations of the company (2) Awareness of the duties of the functional committees (3) Improvement in the quality of decision-making (4) Election and composition of the functional committees (5) Internal controls
Every three years	March 2020 to Feb. 2021	Commissioning of an independent evaluator to conduct an overall assessment of the board’s performance	Commissioned the Taiwan Corporate Governance Association to conduct the evaluation	Evaluation of the performance of the board, including its composition, guidance, delegation, supervision, communication, internal controls and risk management, self-discipline and other matters, e.g. board meetings and support systems

4. Other BoD objectives:

(1) Training programs for directors: Aside from encouraging directors to attend outside seminars, the Company holds annual in-house sessions to facilitate interactions between lecturers and directors. The total number of training hours was 82.5 in 2022, which included programs such as “Trends and impact of sustainable finance” and “The new financial era: Development trends and strategies in digital technology.”
(2) Information transparency: Committed to upholding operational transparency and protecting shareholders’ interests, the Company regularly discloses resolutions by the Board of Directors in a timely and consistent manner. In addition, the Company holds institutional investor conferences on a quarterly basis and has set up Chinese/English sections for Investor Relations and Corporate Social Responsibility on its official website.
(3) Liability insurance: The Company provides its directors and managers with annual liability insurance to cover risks as they carry out their duties, reviews the insurance coverage on an annual basis and reports to the board to make sure the amount and scope are sufficient to the need.
(4) The Chairman of the Board of Directors is not a member of the Company’s management team to ensure a system of checks and balances.
(5) The Audit Committee, the Remuneration and Nomination Committee and the ESG Steering Committee assist the Board of Directors in carrying out supervisory tasks. The chairperson of each committee reports on their committee’s operations to the board on a regular basis.
(6) The Company passed the Rules and Procedures on Evaluating the Performance of the Board and Functional Committees to enhance efficiency, under which the Remuneration and Nomination Committee conducts an analysis and submits a report on proposed improvements to the board after an annual performance evaluation. Board members completed an evaluation assessment in the first quarter of 2023.
(7) To strengthen corporate governance and enhance the board’s functions, the Board of Directors passed a proposal that independent directors should comprise at least 40% of the board, and that the Remuneration and Nomination Committee should be in charge of identifying and nominating competent candidates.

Audit Committee attendance

The Audit Committee is responsible for reviewing the following:

⚫ Financial reports
⚫ Internal control systems and related policies, procedures and assessment of their effectiveness
⚫ Compliance with Article 36-1 of the Securities and Exchange Act
⚫ Material asset or derivatives transactions
⚫ Material monetary loans, endorsements or guarantees
⚫ Offering, issuance or private placement of equity-type securities
⚫ Fairness and rationality of the Company’s M&A plans and transactions
⚫ Any matter that has a bearing on the personal interest of a management executive or director
⚫ Fraud investigation reports
⚫ Interacting and communicating with management and listening to business strategy development reports
⚫ Hiring or dismissal of an attesting CPA, or the compensation given thereto
⚫ Performance, qualification and independence of CPAs
⚫ Appointment or discharge of financial, accounting or internal auditing officers

1. The Audit Committee convened six times in 2022

Title	Name	Attendance in person	Attendance ratio	Remarks
Independent Director	Hsueh-Jen Sung	6	100%	Appointed committee chairman
Independent Director	Char-Dir Chung	6	100%	None
Independent Director	Hsi-Peng Lu	6	100%	None
Independent Director	Tong Hai Tan	6	100%	None
Independent Director	Drina Yue	6	100%	None

2. Any objections or issues raised by the Audit Committee against resolutions passed by the Board of Directors

(1) Pursuant to Article 14-5 of the Securities and Exchange Act:

Date	Audit Committee	Proposals and reports	Audit Committee’s major suggestions	Audit Committee’s opinion	Company’s response
2022.01.24	13th meeting of the fifth Audit Committee	Appointment of CPA	None	Approved as proposed	Approved as proposed
		2022 capital expenditure plan and donation to TWM Foundation
		Procurement of mobile broadband equipment from Nokia Solutions and Networks Taiwan Co., Ltd. (capped at NT$4.205bn)
		Participation in the NT$2.8bn new share issue of 100%-owned TWM Venture Co., Ltd.
		2021 internal control statement
2022.02.21	14th meeting of the fifth Audit Committee	Acquisition or disposal of right-of-use assets	None	Approved as proposed	Approved as proposed
		2021 business report and financial statements
2022.05.05	15th meeting of the fifth Audit Committee	1Q22 financial statements	None	Approved as proposed	Approved as proposed
		Acquisition or disposal of right-of-use of assets
		2021 earnings distribution and cash return from capitalsurplus
		Revisions to the Rules and Procedures for Acquisition or Disposal of Assets
		Removal of non-competition restrictions for board members
		Additional capital expenditure for network integration with Taiwan Star (NT$4.025 billion)
		Procurement of mobile broadband equipment from Nokia Solutions and Networks Taiwan Co., Ltd. (capped at NT$3.296bn)

Date	Audit Committee	Proposals and reports	Audit Committee’s major suggestions	Audit Committee’s opinion	Company’s response
2022.06.16	16th meeting of the fifth Audit Committee	Subscription to LINE Bank Taiwan Ltd’s common shares via private placement	None	Approved as proposed	Approved as proposed
		Acquisition of secondary shares of Cloud Mile Inc. through 100%-owned TWM Venture Co.,Ltd.
2022.08.01	17th meeting of the fifth Audit Committee	2Q22 financial statements	None	Approved as proposed	Approved as proposed
2022.11.09	18th meeting of the fifth Audit Committee	3Q22 financial statements	None	Approved as proposed	Approved as proposed
		Acquisition or disposal of right-of-use assets
		Internal audit plan for 2023
		Investment in AppWorks Fund IV L.P. through 100%-owned TWM Venture Co., Ltd.

(2) In addition to the items listed above, any resolution passed by over two-thirds of the Board of Directors, but not approved by the Audit Committee: None.

3. Any recusals due to conflicts of interest: None.

4. Communication between independent directors and the Internal Audit Chief Officer and CPAs about major financial/operational matters:

(1) The Internal Audit Chief Officer and CPAs communicated directly with independent directors when needed.
(2) In addition to presenting monthly reports to the independent directors, the Internal Audit Chief Officer and CPAs met with the independent directors at the quarterly Audit Committee meetings, bringing communication into full play.
(3) Regular communication between independent directors and internal audit officers/CPAs:

Date	Internal Audit Officers	Internal Audit Officers	CPAs	CPAs
	Subject matter	Results	Subject	Results
2022.01.24 13th meeting of the fifth Audit Committee	1. 4Q21 internal audit report 2. 2021 internal control statement	1. Acknowledged 2. Reviewed and submitted to BoD for approval	-	-
2022.02.21 14th meeting of the fifth Audit Committee	-	-	1. 2021 financial statements, key audit matters, explanations of computer audit, and other communication items 2. Discussed the international standards for management of innovation and intellectual property 3. Discussed inquiries raised by attendees	Acknowledged
2022.05.05 15th meeting of the fifth Audit Committee	1Q22 internal audit report	Acknowledged	1. 1Q22 financial statements 2. Discussed inquiries raised by attendees	Acknowledged
2022.08.01 17th meeting of the fifth Audit Committee	1. 2Q22 internal audit report 2. Report the business of the Risk Management Committee 3. Revision of risk managementpolicy	1. Acknowledged 2. Acknowledged 3. Reviewed and submitted to BoD for approval	1. 2Q22 financial statements 2. Discussed inquiries raised by attendees	Acknowledged
2022.11.09 18th meeting of the fifth Audit Committee	1. 3Q22 internal audit report 2. Internal audit plan for 2023	1. Acknowledged 2. Reviewed and submitted to BoD for approval	1. 3Q22 financial statements and communication of key audit matters 2. Discussed inquiries raised by attendees	Acknowledged

Corporate governance practices

orporate governance practices	orporate governance practices
Item		Current practices

		The Company has established said Corporate
Has the Company established principles based on
		Governance Best Practice Principles and published them
the Corporate Governance Best Practice Principles
		on the Company’s official website and market observation
for TWSE/GTSM Listed Companies?
		post system (MOPS).


Shareholding structure and shareholders’ interests	Handling of shareholders’ suggestions and disputes	The Corporate Governance Best Practice Principles includes a chapter on upholding shareholders’ interests. The spokesperson or Secretarial Division handles all non- legal issues; the Legal Division handles all legal issues.
	Identification of major
		The Secretarial Division submits a monthly report listing
	shareholders and investors	the shareholdings of directors, managers and major
	with controlling interests	shareholders (over 10% shareholding) to the authorities.

	Risk control mechanisms and firewalls between the Company and its subsidiaries	The Company’s internal control system set up the Rules and Procedures on Conducting Transactions between Group Companies and Related Parties and the Rules and Procedures on Monitoring Subsidiaries as risk control mechanisms.

		The Company has established Rules and Procedures on
		Handling Internal Material Information, which are given to
		employees when they start work. The Company also
	Prohibitions on insider trading	provides guidelines on handling and processing internal
		material information, as well as corporate ethics, to
		ensure that employees and directors are familiar with and
		comply with said regulations.

	Board diversity and execution	Diversity of board members is stipulated in the Company’s Rules for Election of Directors and has been fully implemented.



	Establishing a Remuneration
	and Nomination Committee	The Company has established an ESG Steering
	and an Audit Committee in	Committee, Cyber Security and Data Privacy Protection
	accordance with the law and	Committee, and Risk Management Committee to enhance
	voluntarily setting up other	various functions.
	functional committees
	Board performance evaluation	The Company passed the Rules and Procedures on Evaluating the Performance of the Board and Functional Committees to enhance efficiency, under which the Remuneration and Nomination Committee conducts an analysis and submits a report on proposed improvements to the board after an annual performance evaluation and uses it as a reference for remuneration and re- appointment. The performance evaluation was completed through self-assessments by board members, which covered evaluations of the performance of the board, board members and functional committees. Both the board and committees performed well, with an average rating of 4.96, with 5 being the highest score. The Company appointed the Taiwan Corporate Governance Association (TCGA) to conduct its board evaluation in January 2021. The evaluation, covering the period from March 1, 2020 to February 28, 2021, focused on eight aspects: composition, guidelines, authorization, supervision, communication, internal controls and risks, self-discipline and support systems. The report was issued on May 3, 2021 and presented to the Board of Directors by the Remuneration and Nomination Committee on August 5, 2021. The results of the evaluation and proposed countermeasures were as follows:




Board of directors
and its
responsibilities

	Item	Current practice
		A. Comments： (a)The Company values having a diverse board of directors, with members who are selected based not only on the Company’s current needs, but also their capabilities in advancing its future development. Independent members take up more than half of the board seats. Aside from attending scheduled meetings, board members take an active role in the Company’s various business operations and interact closely with management. (b)To lead the Company’s transformation, the board appointed a president with a nontraditional telecommunications industry background two years ago. The president’s performance is evaluated by the Remuneration and Nomination Committee using the Balanced Scorecard model, taking into consideration the Company’s short, medium and long-term goals. (c)The Company again appointed an independent evaluator to assess the board’s performance. It took actions on all recommendations from the previous evaluation and disclosed relevant information in the annual report and on its corporate website. This showed the board’s proactive approach to enhancing corporate governance and the effectiveness of the board. (d)To manage potential risks related to the Company’s transformation, the chairman acts as the convener and supervisor of the Risk Management Committee. The committee holds a meeting at least every six months and reports its operations to the board at least once a year. B. Suggestions/Implementation: (a)As the Company pursues a new growth curve with a business model that differs from its existing position as a traditional telecommunications company, it was recommended that the board continuously strengthen risk controls, regularly review the effectiveness of the internal control system and make adjustments accordingly. The Company has executed the suggestions. (b)The Company was advised to set up a Nomination Committee. The functions of the Nomination Committee were incorporated into the Remuneration and Nomination Committee in 2018.

		The heads of finance and other divisions of the Company
		and its subsidiaries conduct annual evaluations of the
		independence and reappointment of CPAs according to
		“The Bulletin of Norm of Professional Ethics for Certified

		Public Accountants of the Republic of China” and
	Periodic review of CPA’s
		“Corporate Governance Best Practice Principles for
	independence
		TWSE/GTSM Listed Companies,” and referring to Audit

		Quality Indicators (AQIs) based on the following criteria
		and procedures:

Item	Item	Current practices

		1. The CPAs’ resumes.

		2. The CPAs neither serve as a director/supervisor/
		manager nor hold a position with major influence in the
		Company or its subsidiaries, and have no interests
		that conflict with the Company’s.
		3. The CPAs have not served as auditors for the
		Company for seven consecutive years.
		4. The CPAs should provide the Company with a
		Declaration of Independence on a quarterly basis.
		5. The CPAs have not provided non-audit services to the
		Company which might affect their independence.
		6. The CPAs are not involved in any significant lawsuit or
		litigation, and have never been censured by any
		regulatory body.
		7. The CPA firm’s involvement, quality control review
		and innovative plans.
		8. Effective interaction with manager and internal
		audit officer.

		The results of the 2022 evaluation met the independence
		criteria and were approved by the Audit Committee on
		February 23, 2023 and the board on February 24, 2023.

Has the Company set up a full/part time unit or personnel and appointed a Chief Corporate Governance officer in charge of handling corporate governance-related matters – including, but not limited to providing information for board directors to carry out their duties, preparing board and shareholders' meetings, handling company registration and any changes therein, and recording board and shareholders’ meeting minutes?		The VP/CFO who heads the Secretarial Division is also the Chief Corporate Governance officer. He has more than 10 years of experience in the securities industry, including managing listed companies’ financial affairs. The division head attended the following training programs in 2022: 1. Corporate governance 3.0: Practical analysis of sustainability reports (Accounting Research and Development Foundation, 3hr) 2. Digital technology development and application trends (Taiwan Corporate Governance Association, 3hr) 3. The explosion of the virtual world: The development of metaverse and cryptocurrency blockchain (Taiwan Corporate Governance Association, 3hr) 4. The new financial era: Development trends and strategies in digital technology (Independent Directors’ Association Taiwan, 3hr) 5. Driving the green transition: Aiming for net zero (Accounting Research and Development Foundation, 3hr) The division provided the following: 1. Assisted directors in assuming their positions, furnished them with information required for business execution and held seminars to facilitate interaction between lecturers and directors. 2. Purchased annual liability insurance for directors. 3. Prepared board of directors’ and shareholders’ meetings, and handled company registration and any changes therein.

Item	Item	Current practices

		Sections on investor relations, procurement and ESG have
Has the Company established communication		been set up on the Company’s official website and
channels with stakeholders (including, but not		integrated into one comprehensive stakeholders’ section.
limited to shareholders, employees, customers and		Special personnel have been assigned to handle ESG
suppliers) and set up a stakeholders’ section on the		related issues.
Company’s website to respond to critical corporate
social responsibility issues?


Has the Company outsourced its shareholders' general meetings?		The Company has engaged the Transfer Agency and Registry Department of Fubon Securities Co., Ltd. to manage its annual general meeting.
	Disclosure of information on	Disclosure of financial-related and corporate governance
	financial status, operations	information is posted periodically on the Company’s
	and corporate governance	website.

	Other ways of disclosing information	Aside from having a spokesperson, the Company has a dedicated department – the Investor Relations Division – to handle information disclosure. It also has an English website and a team working on gathering and releasing relevant Company information.
Information	Has the Company published
disclosure	and reported its annual
	financial statement within
	two months after the end of	In 2022, the Company published and reported its annual
	a fiscal year, and published	financial statement within two months after the end of
	and reported its financial	the fiscal year. It published and reported its first, second
	statements for the first,	and third quarter financial statements before deadline,
	second and third quarters,	as well as its monthly operating status ahead of the
	as well as its operating	target date.
	status for each month,
	before the specified
	deadline?

Additional information

1. Employee rights

The Company’s human resources policies comply with provisions prescribed under the law, such as the Labor Standards Act, in safeguarding employee rights.

2. Employee care

The Company provides different communication channels to facilitate communication within the firm. These include holding regular labor-management meetings to accommodate suggestions for improvement and conducting surveys to gather employees’ comments about the workplace and management practices.

3. Investor relations

The Company posts financial, operational and material information on its official website and MOPS in a timely manner to keep investors abreast of Company developments and strategies and, thus, maximize shareholders’ interests.

4. Supplier relations

The Company holds procurement bids based on the “Procedures Governing Procurement” and suppliers deliver products in accordance with the contract.

5. Stakeholders’ rights

To protect the interests of stakeholders, the Company has established various free and open communication channels to promote trust and corporate social responsibility.

6. Training programs for directors in 2022

Training program	Organization	Date	Hours	Participant(s)
Analysis of “Audit Committee Guide”	Taiwan Corporate Governance Association	2022.01.24	1	Hsueh-Jen Sung, Char-Dir Chung, Hsi-Peng Lu, Tong Hai Tan, Drina Yue, Jamie Lin
Principles on fair treatment of customers	Taiwan Insurance Institute	2022.03.04	1.5	Richard M. Tsai
Forum on independent directors and 2022 shareholders’ meeting – an international perspective	Taiwan Stock Exchange, Quantum International Corp., Georgeson LLC	2022.03.10	1	Hsueh-Jen Sung, Tong Hai Tan, Drina Yue
The development of green energy innovation business: Vision and strategies for low carbon investments	Taiwan Corporate Governance Association	2022.03.22	3	Char-Dir Chung
Metaverse, NFT, Web 3.0 and social network: basic concepts and applications	Taiwan Corporate Governance Association	2022.03.22	3	Hsi-Peng Lu
Carbon neutrality, enterprise management and promotion and prospects of Taiwan taxonomy for sustainable activities	Independent Directors’ Association Taiwan	2022.04.21	3	Daniel M. Tsai, Richard M. Tsai
Carbon pricing guidelines in Taiwan – TCFD climate-related analysis	Independent Directors’ Association Taiwan	2022.04.29	3	Daniel M. Tsai
Twin-summit forum	Taiwan Stock Exchange, Alliance Advisers Pty Ltd., Taiwan Corporate Governance Association	2022.05.04	2	Drina Yue
Twin-summit forum	Taiwan Stock Exchange, Alliance Advisers Pty Ltd., Taiwan Corporate Governance Association	2022.05.12	2	Hsueh-Jen Sung
2030/2050 green industrial revolution	Taiwan Corporate Governance Association	2022.07.05	3	Drina Yue

Training program	Organization	Date	Hours	Participant(s)
Sharing of actual cases by the Audit Committee – Review of mergers and the responsibilities of directors	Taiwan Corporate Governance Association	2022.07.12	3	Tong Hai Tan
Sustainability accelerators: CSR, ESG and SDGs	Taiwan Investor Relations Institute	2022.08.09	3	Hsi-Peng Lu
Challenges and opportunities in pursuing sustainable development	Taiwan Securities Association	2022.08.10	3	Char-Dir Chung
Latest IFRS 17 related issues	Taiwan Insurance Institute	2022.08.12	3	Richard M. Tsai
Multifaceted view of ESG governance – from knowing to doing	Taiwan Corporate Governance Association	2022.08.16	3	Tong Hai Tan
Information security oversight between government and competent authority for supply chains and financial services	EY Advisory Services Inc.	2022.09.30	2	Richard M. Tsai
Trends and impact of sustainable finance	Taiwan Corporate Governance Association	2022.10.07	3	Daniel M. Tsai, Hsi-Peng Lu, Jamie Lin
Information security and privacy issues in the metaverse	Taiwan Insurance Institute	2022.11.01	3	Hsueh-Jen Sung
Principles on fair treatment of customers and financial inclusion services	Independent Directors’ Association Taiwan	2022.11.02	3	Daniel M. Tsai
The new financial era: Development trends and strategies in digital technology	Independent Directors’ Association Taiwan	2022.11.25	3	Daniel M. Tsai, Chris Tsai, Hsi- Peng Lu, Jamie Lin
The application of AI technology in new fields – financial technology and anti-money laundering	Independent Directors’ Association Taiwan	2022.12.09	3	Daniel M. Tsai, Chris Tsai

Note: The training hour requirements listed above have been fulfilled.

7. Corporate governance related training programs and succession plan for management in 2022

At the end of every year, the Company develops a training plan for the following year in accordance with enterprise development strategies, a survey of training needs and interviews with each group’s senior executives. Training courses for senior executives are closely aligned with corporate strategies and global business trends. In 2022, the Company arranged training courses covering topics such as “Exploring the business opportunities of telecom integration with fintech,” “A new consumption model for OMO,” “Net-zero emissions” and “Corporate governance and securities regulations.”

The Company has developed a succession plan for senior executives that is in line with corporate core values and future strategies. It evaluates the capability and performance of each executive on a regular basis and provides customized training programs, job assignments or job rotation accordingly. The progress of the succession plan is reviewed by the Remuneration and Nomination Committee.

In line with this plan, the Company recently promoted Mr. Tim Lee to Vice President and Chief Strategy Officer on November 10, 2022. Mr. Lee has contributed greatly to the Company, building an international team of investment professionals and leading several major investment projects to assist in the Company’s transition to the global market.

Training program	Organization	Date	Hours	Participant(s)
Code of ethics	In-house training (e-learning)	2022.02.19 ~ 2022.12.23	0.5	George Chang, Rock Tsai, Tony Lin, Luke Han, Vincent Wu

Training program	Organization	Date	Hours	Participant(s)
Ethical corporate management best practice principles	In-house training (e-learning)	2022.05.05 ~ 2022.11.18	0.9	Jamie Lin, Tom Koh, Tim Lee, Eddie Chan, Rock Tsai, Tony Lin, C.H. Wu, Joan Hung, Jay Hong, Shirley Chu, Ming-Tung Wu, Steve Chou, Kate Chen, David Lin, Daphne Lee, Iris Liu, Naomi Lee,VincentWu
Analysis of “Audit Committee Guide”	Taiwan Corporate Governance Association	2022.01.24	1	Jamie Lin
Constructing a sustainable DNA to achieve a net-zero future	Chinese National Association of Industry and Commerce	2022.05.18	3	Tom Koh, Iris Liu
Exploring the business opportunities of telecom integration with fintech	In-house training	2022.05.20	1.83	Tom Koh, Rock Tsai, C.H. Wu, Joan Hung, Jay Hong, Shirley Chu, Ming-Tung Wu, Steve Chou, Kate Chen, David Lin, Daphne Lee, Iris Liu
A new consumption model for OMO	In-house training	2022.07.08	2	Tom Koh, Rock Tsai, Tony Lin, C.H. Wu, Joan Hung, Jay Hong, Shirley Chu, Ming-Tung Wu, Steve Chou, Kate Chen, David Lin, Daphne Lee, Iris Liu
Taiwan's net-zero emissions goal: scientific solutions and industrial opportunities	Chinese National Association of Industry and Commerce	2022.08.22	2	Tom Koh
Multinational corporations’ operations	Taiwan Renaissance Platform	2022.08.26	68.5	Tony Lin, Joan Hung
Digital technology development and application trends	Taiwan Corporate Governance Association	2022.09.07	3	George Chang
The explosion of the virtual world: The development of metaverse and cryptocurrency blockchain	Taiwan Corporate Governance Association	2022.09.23	3	George Chang
Analysis of “Audit Committee Guide”	Taiwan Corporate Governance Association	2022.10.07	3	Jamie Lin
Seminar on net zero emissions	Taiwan Communications Society	2022.10.07	4	Tom Koh
Corporate sustainability seminar – how to implement ESG	Taiwan Stock Exchange Corporation	2022.10.17	2	Shirley Chu
Corporate governance summit: Improving the functional competencies of directors and implementing sustainable corporate governance	Taiwan Corporate Governance Association	2022.10.19	3.5	Iris Liu

Training program	Organization	Date	Hours	Participant(s)
Corporate governance and securities regulations	In-house training	2022.11.18	3	Shirley Chu
The new financial era: Development trends and strategies in digital technology	Independent Directors’ Association Taiwan	2022.11.25	3	Jamie Lin, George Chang
Fintech and AI: Development trends and strategies during a pandemic	In-house training	2022.11.25	3	George Chang
Driving the green transformation: net-zero emissions	Accounting Research and Development Foundation	2022.12.21	3	George Chang

8. Risk management

Risk management policies

(1) Promote a risk management-based business model
(2) Establish a risk management mechanism that can effectively cite, evaluate, supervise and control risks
(3) Create a company-wide risk management structure that can limit risks to an acceptable or controllable level
(4) Introduce best risk management practices and continue to seek improvements

Risk management structure

==> picture [531 x 339] intentionally omitted <==

Added as a working group based on a proposal by the ESG Steering Committee to the Board of Directors on Nov. 10, 2022

The Company’s risk management structure is made up of three levels of control mechanism, and a monitoring mechanism:

	Responsible unit	Function
Ground	Corporate Affairs, Information Technology Group, Technology Group, Consumer Business Group, Enterprise Business Group, Home Business Group, Finance Group	Risk factors are analyzed and assigned to responsible units to monitor and ensure timely and effective detection. Each unit shall ensure, on a daily basis, that risks are kept under acceptable levels. Should there be any changes in condition or other factors, the responsible unit shall report these to the Company for an appropriate course of action.
Middle	Risk Management Committee*	Integrate the Company's risk management framework and internal control mechanism. Execute risk management strategies and conduct a review of the efficiency of the overall risk management mechanism. Exercise control over the four following committees:
	1) Operations and Management Committee	Conduct periodic reviews of each business group’s operating targets and performance to meet the Company’s guidance and budget.
	2) Communication Quality Assurance Committee	Ensure and manage network communication quality.
	ESG Steering Committee	Establish a functional committee governance system, strengthen management functions, and commit to the implementation of corporate social responsibilityand sustainable management.
	1) ESG Working Group	Integrate operations and core resources to promote the Company’s ESG policies to move toward sustainable development.
	2) Occupational Safety and Health Working Group	Supervise and minimize potential risks to workers’ health and safety.
	3) Environmental Working Group	Develop and manage the Company's policies and objectives for environmental and energy management.
	4) Innovation Working Group	Integrate the Company’s innovation strategies and establish a management mechanism.
	5) Brand Development Working Group	Implement the brand spirit of "Open Possible" and build a seamless brand experience from the inside out through employee conduct, products and services, internal and external working environments, and marketingcommunications.
	Cyber Security and Data Privacy Protection Committee	Demonstrate the Company’s commitment to these principles by investigating reported breaches of information privacy principles and policies, and, if necessary, take appropriate corrective measures.
Top	Board of Directors	Responsible for assessing material risks, designating actions to control these risks and keeping track of their execution.

	Responsible unit	Function
Monitoring mechanism	Internal Audit Office	Regularly monitor and assess potential and varying levels of risks that the Company might face and use this information as a reference for drafting an annual audit plan. Report any discrepancy to the concerned unit chief and ensure that remediation efforts are completed.

The Board of Directors exercises control over the ESG Steering Committee and the Cyber Security and Data Privacy Protection Committee. In addition, the Chairman exercises control over the Risk Management Committee. If any major event or incident happens, the responsible unit shall report it to the Operations and Management Committee and corresponding Committee or Working Group to determine the necessary measurement to be undertaken.

Risk management scope

	Important risk factors	Responsible unit	Examining committee	Decision-making and supervision
1	Operating risk	Technology Group / IT Group	Operations and Management Committee	The highest decision- making body: Board of Directors Monitoring mechanism: Internal Audit Office
2	Market risk A. Competition B. New products C. Channel management D. Inventory management	CBG, EBG and HBG
3	Credit and collection risks	Business Operations Management Division and Billing Management Division
4	Government policies and regulatory compliance	Regulatory and Carrier Relations Division
5	M&A and investments	President’s Office
6	Volatility of interest rates, exchange rates and financial risks	Finance Division
7	Financing and endorsements / guarantees provided to others, derivatives transactions and working capital management	Finance Division
8	Financial report disclosure and tax risk management	Accounting Division
9	Litigious and non-litigious matters	Legal Office
10	Changes in shareholding of directors and major shareholders	Secretarial Division
11	Board meeting facilitation	Secretarial Division
12	Employee behavior, code of ethics and conduct	Human Resources Division
13	Corporate social responsibility risks and other emerging risks	Sustainability and Brand Development Division	ESG Steering Committee -- ESG Working Group

	Important risk factors	Responsible unit	Examining committee
14	Employee safety	Occupational Safety and Health Office and Administration Division	Occupational Safety and Health Working Group
15	Risks related to privacy and information security	ICT and Personal Information Security Management Division	Cyber Security and Data Privacy Protection Committee
16	Technology and maintenance risks	President’s Office – Communication Quality Assurance Department	Communication Quality Assurance Committee
17	Environmental and energy risks	Network Engineering Division	Environmental Working Group
18	Innovation risk	CBG, EBG, HBG, Technology Group, IT Group, Sustainability and Brand Development Division	Innovation Working Group

9. Implementation of customer policy

With customer service as a core value, the Company provides online customer services on its official website. To gain customer trust, the Company established the 080 Home Agent to continue providing customer services amid the COVID19 pandemic.

10. Liability insurance for board directors

The Company purchases annual liability insurance for its directors and reports the insurance coverage, amount and scope to the board of directors on a regular basis.

11. Employee certifications relating to information transparency

. Employee certifications relating to information transparency
Certification	Number of Employees
	Internal Audit Office	Corporate Affairs	Finance Group
Certified Public Accountant (CPA)			11
US Certified Public Accountant (US CPA)		1	3
Certified Internal Auditor (CIA)	3		2
Certified Information Systems Auditor (CISA)	2
Chartered Financial Analyst (CFA)		2	1
Corporate Governance basic skills			3
Stock affairs specialist (Securities and Futures Institute)			3
Bond specialist (Securities and Futures Institute)			2
ISO20000/ISO22301/ISO27001/ISO27701/ISO29100/ISO9001/BS10012/BS25999/BS7799 Lead Auditor	11	12	10

Any internal evaluation or third-party assessment reports on corporate governance. If yes, specify results, major flaws or recommendations for improvements:

The Company participated in the “Corporate Governance Evaluation” conducted by the Taiwan Stock Exchange and Taipei Exchange, ranking among the top 5% listed companies for eight consecutive years.

Remuneration and Nomination Committee operations

The Remuneration and Nomination Committee, composed entirely of independent directors, is bound by the Remuneration and Nomination Committee Charter. The committee is responsible for the following:

(1) Establishing a policy, system, standard and structure for directors’ and managers’ compensation and reviewing them periodically.
(2) Deciding the compensation of directors and managers and carrying out periodic evaluations.
(3) Selecting, assessing and nominating candidates for directorships.

Qualifications and independence criteria of members of the Remuneration and Nomination Committee

Identity	Name	Professional qualifications and experience	No. of public companies in which he or she also serves as a member of the Remuneration and Nomination Committee
Independent Director	Char-Dir Chung	Please refer to page 24-28 “Qualifications and independence criteria of directors”	0
Independent Director	Hsueh-Jen Sung		0
Independent Director	Hsi-Peng Lu		3
Independent Director	Tong Hai Tan		0
Independent Director	Drina Yue		0

Remuneration and Nomination Committee attendance

(1) The Remuneration and Nomination Committee consists of five members.
(2) Tenure of the Fourth Remuneration and Nomination Committee: June 18, 2020 to June 17, 2023. The committee convened five times in 2022:

Name	Attendance in person	Attendance ratio	Remarks
Char-Dir Chung	5	100%	None
Hsueh-Jen Sung	5	100%	None
Hsi-Peng Lu	5	100%	None
Tong Hai Tan	5	100%	None
Drina Yue	5	100%	None

Any suggestion made by the Remuneration and Nomination Committee that was not accepted or revised by the Board of Directors: None
Any written objections or issues raised by a member of the Remuneration and Nomination Committee against resolutions passed by the committee: None

Meetings of Remuneration and Nomination Committee

Date	R&N Committee meeting	Agenda	R&N Committee’s opinion	Company response
2022.01.25	6th meeting of the fourth R&N Committee	Severance pay proposal for manager	Approved as proposed	Approved by the BoD
		Results of a 2021 performance evaluation of managers/head of internal audit, and year-end bonus distribution	Approved as proposed	Approved by the BoD
		2021 year-end bonus of the Chairman	Approved as proposed	Approved by the BoD
2022.02.22	7th meeting of the fourth R&N Committee	Report on the results of a 2021 performance evaluation of the BoD and functional committees	Approved as proposed	Approved by the BoD
		2021 remuneration distribution plan for BoD	Approved as proposed	Approved by the BoD
		Appointment of a manager	Approved as proposed	Approved by the BoD

Date	R&N Committee Meeting	Agenda	R&N Committee’s Opinion	Company Response
		2022 balanced scorecard goal setting for the President	Approved as proposed	Approved by the BoD
2022.05.06	8th meeting of the fourth R&N Committee	Appointment of a manager	Approved as proposed	Approved by the BoD
2022.08.01	9th meeting of the fourth R&N Committee	Severance pay proposal for manager	Approved as proposed	Approved by the BoD
		Appointment of a manager	Approved as proposed	Approved by the BoD
		Results of 2021 year-end bonus distribution for managers	Approved as proposed	Approved by the BoD
		2021 employee profit sharing and mid-year bonus distribution plan and 2022 salary adjustment proposal for managers/head of internal audit	Approved as proposed	Approved by the BoD
		2021 annual compensation and 2022 salary adjustment proposal for the Chairman	Approved as proposed	Approved by the BoD
2022.11.10	10th meeting of the fourth R&N Committee	Severance pay proposal for manager	Approved as proposed	Approved by the BoD
		Appointment of a manager	Approved as proposed	Approved by the BoD

Environmental, social and corporate governance (ESG)

Item

Current practices

Corporate governance
1.
Setting up a unit to carry
out environmental, social
and corporate governance
(ESG) policy or system
2.
Applying the materiality
principle to identify material
ESG topics, and setting
corresponding policies or
strategies

1.
The Sustainability and Corporate Citizenship Department was established
under the Sustainability and Brand Development Division with a dedicated
staff and an independent budget. It serves as the executive secretary to the
ESG Steering Committee and the ESG Working Group, and is responsible
for integrating interdepartmental ESG tasks.
The CSR Committee was established in 2014, and renamed the ESG
Steering Committee in 2021 following the Board’s approval. In 2022, the
ESG Steering Committee, which fell under the Chairman’s purview, was
elevated to a board-level committee, and the Chairman was appointed as
the convenor with five independent directors. The committee holds meetings
at least twice a year to comprehensively supervise all decision-makings
involving ESG. The previous ESG Steering Committee, which was under the
Chairman’s purview, was renamed the ESG Working Group in 2022, with
TWM's Chairman and President serving as its chairman and vice chairman,
respectively. The ESG Working Group holds quarterly meetings and reports
to the ESG Steering Committee and the Board of Directors every six months
about
environmental,
social
and
governance
proposals
and
implementations. In March 2022, TWM officially joined the RE100 renewable
energy initiative, and the Board of Directors in May approved a pledge to
achieve net zero emissions by 2050.
2.
The ESG materiality boundaries were defined based on the nature of Taiwan
Mobile’s operations.
A total of 24 topics concerning sustainability were selected by applying the
materiality principle after researching international trends, referring to world-
class corporates, holding stakeholder forums, and analyzing questionnaires
from our official website. The material topics were confirmed by the ESG
Working Group after surveying stakeholders' level of concern and assessing
the significance of impact.
TWM prioritized topics that were more vital to its operations, concerned
stakeholders more, and in which the Company had a high impact on society.
It also considered topics that the Company would manage internally in an
autonomous manner. The material topics were confirmed by the ESG
Steering Committee. In 2022, TWM identified these key material topics and
conducted an impact analysis, setting strategic targets in accordance with
its risk management policies.

Item

Currentpractices

Environmental sustainability
1.
Establishing an environmental
management system in line with
the nature of the Company’s
business operations
2.
Promoting advanced and
efficient use of renewable
resources to reduce their
impact on the environment

1.
The Environmental Management Committee was formed in 2016, and
renamed the Environmental Management Working Group in 2022, with
the CTO serving as the chairperson, and the Sustainability and Brand
Development Division VP as the vice chairperson. It was tasked with
developing environmental policies and objectives, as well as integrating
the administration of ISO 14001 environmental management, ISO 14064-
1 greenhouse gas inventories, ISO 50001 energy management,
renewable energy, biodiversity conservation and smart energy
conservation. The committee meets semi-annually to assess the
Company’s progress in reducing electricity and water consumption, as
well as waste and carbon emissions, to meet its goal to lower GHG
emissions and promote renewable energy, and to report back to the ESG
Working Group, ESG Steering Committee and Board of Directors.
The company conducts ISO 14001, ISO 14064 and ISO 50001
verifications every year, and obtains corresponding certificates. The
scope of the inspection is as follows:
(1)
ISO 14001: Telecommunications and cable TV operations, covering
Taipei New Horizon headquarters, Cloud IDC, Taipei 480 Ruiguang
Building, Taipei Dunnan Building, the main computer room in
Kaohsiung’s Hsin Ya, the Kaohsiung Po Ai Building, the Taichung
Peiping Building and the momo Cable TV Building.
(2)
ISO 14064: Office buildings, computer rooms, base stations and
directly operated stores of Taiwan Mobile (including Taiwan Mobile
Foundation), Taiwan Digital Service, Taiwan Teleservices &
Technologies, Taiwan Fixed Network, TFN Media and its
broadcasting channels, Win TV Broadcasting, Taiwan Kuro Times
Co., Ltd, Taipei New Horizon Co., Ltd. and Tai Hsin Insurance
Agent.
(3)
ISO 50001: Taipei Guangdian Building, Cloud IDC and two directly
operated stores.
2.
The Company has recycled 190,000 smartphones since 2008, reducing
carbon emissions by 149,000 kilograms, and since 2015, has accepted
67,000 trade-ins of old devices for new ones, extending the lifecycle of
smartphones and creating NT$490 million in economic benefits. In 2022,
it launched the "Upcycle, Create Possible!" project. Working in
cooperation with 14 NPOs, it took stock of the need for 1,200 mobile
phones and tablets and encouraged the public to donate second-hand
devices. The Company reburbished the used phones and tablets and
donated them to students in rural areas to help narrow the digital gap. At
the same time, it has continuously improved the efficient use of
resources, including paper, water, electricity and energy, and to promote
the reduction and recycling of domestic waste (e.g., cables, batteries and
cellphones).

Item
1. Evaluating climate change risks and opportunities for the Company and taking action
Current practices
1. Climate change is incorporated into corporate risk management at TWM in accordance with the Task Force on Climate-related Financial Disclosures (TCFD) framework.

Governance

The Environmental Management Working Group is in charge of identifying and managing climate change risks and opportunities, reporting climate and environmental risk issues to the Risk Management Committee on a regular basis in accordance with the Company's risk management system. Relevant mitigation and adaptation projects are assessed and approved by the committee. In addition, the Risk Management Committee reports company risks (including climate risks) to the Board of Directors on an ad hoc basis, allowing the board to supervise and provide guidance on formulating relevant strategies.

Risk management

A total of 12 climate risks were reviewed, four of which posed a high risk to operations: increased frequency and severity of typhoons/hurricanes, increased costs of greenhouse gas emissions, increase in demand and regulations relating to sustainability, and increase in the costs of transformation to low-carbon technology.

Financial impact assessment

An impact assessment on three risks selected from the four high climate risks was conducted to fully evaluate their financial effect on the Company.

(1) Increase in demand and regulations relating to sustainability: Investment is estimated to reach NT$12.6 billion to NT$15.0 billion in 2022-2030.
(2) Increased frequency and severity of typhoons/hurricanes: Total losses due to typhoons in 2019-2030 are estimated to reach up to NT$58 million.
(3) Increase in the cost of transformation to low-carbon technology: Investment is estimated to reach NT$2.05 billion in 2019-2030.

Strategic objectives

Based on the results of the financial impact assessment, five core strategies were set:

(1) Strengthen climate-related financial impact disclosures (2) Boost smart energy conservation at its telecommunication facilities and base stations
(3) Procure green energy (4) Build green energy generating stations for self-use (5) Invest in green energy

Item

Statistics on GHG emissions, water consumption and waste, and formulation of environmental sustainability policies

Current practices

The Environmental Management Working Group formulates environmental goals and strategies in accordance with the Environmental and Energy Management Policies, holds meetings every six months to review the implementation of policies relating to electricity and water conservation, waste and carbon reduction, and renewable energy, and track their progress.

Statistics on GHG emissions, water consumption and waste for 20212022 are detailed below:

2022 are detailed below:	2022 are detailed below:	2022 are detailed below:
Category			2021	2022**
GHG emissions (ton-CO2e)	Scopes 1+2 location based		275,302.34	287,472.24
	Scopes 1+2 market based		275,302.34	287,428.46
	Scope 3		350,484.78	313,385.34
Water withdrawal (m3)*			278,876	294,821
Waste		(tons)	1,625.07	1,503.42
Energy consumption		Direct (MJ)	31,069,681	22,586,412
Energy consumption		Indirect (MJ)	1,957,402,998	2,089,276,824

*The source of water withdrawal includes tap water and rainwater. The amount in 2021 is adjusted retrospectively.

**GHG emissions rose due to the increase in mobile data traffic and Internet Data Center users. TWM continues to adopt various renewable energy sources to reduce carbon emissions.

The above-mentioned contents have been externally confirmed by ISAE 3000, and corresponding certificates have been obtained. The scope of the investigation is the same as the boundary and scope of the 2022 sustainability report.

Item

Current practices

Commitment to corporate social
responsibility
1. Complying with domestic and
international labor laws to
safeguard and uphold the rights of
workers, following a non-
discriminatory hiring policy, and
establishing appropriate
management practices,
procedures and execution
2. Establishing reasonable employee
benefits measures (such as
remuneration and leave policy)
and linking company performance
to employee compensation
3. Providing employees with a safe
and healthy working environment,
as well as regular training on
safety and health education
4. Developing individual training
plans for career development

1.
Pursuant to related national regulations, including the Labor Standards
Act, Employment Services Act, Gender Equality in Employment Act
and International Bill of Human Rights, the Company has never
employed child workers, discriminated against any employee or ethnic
group, or forced its employees to work.
2.
The Company offers a well-rounded benefits package. Our Employee
Welfare Committee is responsible for planning and implementing
various benefits, including general benefits, birthday allowance,
holiday vouchers, cafeteria benefit, staff clubs activities, childbirth
allowance, childcare subsidy, free group insurance coverage for
employees and their spouses, an employee stock ownership trust, high
subsidies for phone bills, discounts on Company products and a tenure
reward program. The Company offers maternity leave, sick leave and
bereavement leave that surpass requirements stipulated in Taiwan’s
labor law. Moreover, the Company provides paid volunteer leave,
flexible working hours, and work-from-home as an option.
The Company values the importance of diversity and equality in the
workplace. It has continuously educated its employees about the value
of diversity and resisting unconscious bias in order to build an inclusive
workplace. Employee compensation, benefits, promotion, training and
other rights are not affected by gender, sexual orientation, marriage
status, etc. Women comprise 49.0% of the Company’s workforce and
49.0% of its management. The proportion of women in top
management positions is 35.9%.
Year-end bonuses and employee profit sharing plans are set based
on the Company’s performance. The Company’s compensation policy
is to reward employees commensurate with their performance.
Evaluation meetings are held at the end of the year for supervisors and
staff to discuss their performance over the past year and set objectives
for the following year, including core functions and corporate
sustainable development. Performance
is
graded
based on
employees’ fulfillment of annual objectives and accordingly rewarded
with bonuses and/or salary increases.
3.
The Company aims to provide a safe and healthy working environment
for employees and has implemented measures to promote employee
health and mental well-being. It also conducts periodic evaluations of
the working environment and programs on promoting workers’ safety
and health education. Related information on employee safety and
health is posted on the Company’s intranet.
4.
The Company conducts a survey of employees’ career development
plans and supervisors provide feedback to all employees. Based on
individual key job achievements, career interests, strengths and
weaknesses, supervisors help their staff draw up individual
development plans during the annual performance review to give them
systematic guidance on enhancing their skills and abilities for career
development. From new recruits to top executives, the Company
provides different training programs to meet employees’ needs at
different stages in their career.

Item			Currentpractices
5. Complying with relevant regulations and international standards on marketing and labeling of products and services		5. TWM’s mobile base stations were constructed in accordance with relevant laws and regulations and passed base station electromagnetic checks by the National Communications Commission, having fully complied with the International Commission on Non-Ionizing Radiation Protection standards. The Company holds ISO/IEC 27001 Information Security Management System and BS 10012 and ISO 27701 Privacy Protection Management System certifications. It established an Information Communication and Personal Information Privacy Security Committee, which has invested a lot of resources to comply strictly with various management and control requirements. Every six months, the Company conducts internal and external audits to ensure management quality. The Company abides by the Consumer Protection Law and the Fair Trade Law, and conducts internal legal reviews before launching new marketing ads. The Company has provided a variety of service channels for customers to submit complaints or suggestions to provide them with world-class mobile services. The Company has passed the Swiss SGS Qualicert service verification for 11 consecutive years.
6. Establishing a policy on supplier management, requiring suppliers to follow relevant regulations on issues such as environmental protection, occupational safety and health, and labor rights		6. TWM believes that ethics serves as the moral foundation of a well- managed enterprise. To promote a fair and just system, the Company set up an open procurement system to select suppliers and requires that all suppliers comply with the “Environmental and Occupational Health and Safety Policy for Contractors” and “Guidelines on Corporate Social Responsibility for Suppliers.” Should a supplier break its social responsibility and adversely impact the environment and society, the Company has the right to suspend its account. (1) TWM does not use any product from conflict material/product suppliers. (2) TWM requests its suppliers investigate their supply chains to ensure that no products are from conflict areas.
Has the Company issued ESG reports that have been verified by an independent third-party assurance organization?		In 2014, Taiwan Mobile was proud to be the first Taiwan telecom company to pass the International Standard on Assurance Engagements (ISAE) 3000, demonstrating the Company’s commitment to management integrity. In 2023, the Company published its 2022 sustainability report. A limited assurance of the report’s contents was performed by KPMG, a reputable independent institution, in accordance with the Assurance Standard No. 1 of the Republic of China. The sustainability report also conforms to the Sustainability Accounting Standards Board’s (SASB) Standards on ESG disclosure.

The Company’s ESG policy and practices fully comply with the ESG Best Practice Principles for TWSE/GTSM Listed Companies.

The concept of ESG is embedded in the strategic decisions and daily operations of all departments. The Board of Directors approved the “Taiwan Mobile CSR Policy” and “Taiwan Mobile CSR Guidelines” in 2011 and 2015, respectively. In 2022, in order to enhance the level of sustainable development, and incorporate the company's ESG implementation status and international trends into its policy and guidelines, the Company revised the “CSR Policy" and "CSR Code of Practice" and renamed them "Corporate Sustainable Development Policy" and "Corporate Sustainable Development Guidelines" to serve as long-term guidelines for promoting sustainability. With its underlying corporate philosophy and core values serving as the foundation, TWM emphasizes corporate governance, stakeholders’ interests and full disclosure, and leverages off the Company’s core competencies and services to promote environmental conservation and the public welfare.

Additional information on ESG-related matters:

The Company has formulated a comprehensive mechanism for sustainable operations management. TWM's independent directors, who comprise more than half of the board, took the lead in the industry in elevating the ESG Steering Committee into a board-level unit. The move was approved by the Board of Directors on May 6, 2022, with the Chairman appointed as the convenor with the five independent directors serving as members to comprehensively supervise all ESG-related decision-making, enhancing the depth and width of corporate sustainable management.

Other ESG-related measures include the establishment of the Risk Management Committee under the Board of Directors in 2015 and placing the Cyber Security and Data Privacy Protection Committee directly under the board in 2020. The ESG Steering Committee communicates sustainable development issues related to business risks, social innovation and information security with various committees from time to time. The ESG Working Group members are drawn from the senior management of each business group to enhance accountability, participation and governance by the Company’s top executives. To strengthen implementation, the compensation of the President and Vice Presidents has been tied to the Company’s ESG performance since 2016, and board directors have carried out self-assessments of their ESG performance since 2017.

==> picture [557 x 263] intentionally omitted <==

Added as a working group on Nov. 10, 2022

Ethical corporate management

Item

Currentpractices

1.Establishing a policy on ethical corporate
management:
(1)
Has the Company established an
ethical management policy
approved by the Board of
Directors, and clearly stated, in
the regulations and external
documents, the policies and
practices of ethical management,
and the commitment of the Board
of Directors and senior
management to actively
implement the management
policy?
(2)
Has the Company established a
mechanism for assessing risks of
unethical conduct, regularly
analyzing and evaluating
business activities with a higher
risk of unethical conduct, and
formulating a plan to prevent
unethical conduct, and at least
covering the Ethical Corporate
Management Best Practice
Principles for TWSE/GTSM Listed
Companies’ precautionary
measures in Article 7(2)?
(3)
Has the Company set up a
system, including operational
guidelines, reporting system and
punishment for violations, to
prevent dishonest behavior, as
well as reviewed the
aforementioned guidelines
periodically and amended them
as needed?

(1)
The Company has promulgated its Ethical Corporate
Management Best Practice Principles to establish its
ethical
management
policy.
Its
formulation
and
amendments were approved by the Board of Directors,
submitted to the shareholders' meeting, and disclosed on
the corporate website and MOPS to declare the
commitment of the board and senior management to
implementing the policy.
(2)
(i) The Operating Rules of Ethical Corporate Management
Principles provide specific regulations on matters that
warrant the Company’s special attention in conducting its
business. The Audit Office regularly analyzes and
evaluates business activities with a high risk of dishonest
behavior by conducting annual risk assessments, and
makes audit plans to ensure compliance.
(ii) The Company avoids contact with dubious traders.
Contracts signed with third parties specify compliance
with ethical corporate management practices and, failing
that, the Company reserves the right to terminate or
rescind the contract.
(3)
(i) The Operating Rules of Ethical Corporate Management
Principles prohibit directors, managers, employees and
other mandataries of the Company from directly or
indirectly offering, promising to offer, requesting or
accepting any improper benefits, or committing unethical
acts that contravene the principle of good faith, are illegal
or a breach of fiduciary duty.
(ii)Employees and suppliers are required to sign a
Declaration of Integrity or Declaration of Integrity in
Business Conduct to ensure that they fully understand the
Company’s determination to enforce ethical management
and the consequences of behaving in a dishonest
manner.
(iii)The Audit Office shall periodically notify senior
management and the Legal Office of the auditing results
of compliance with the prevention plan, and prepare an
audit report for the Board of Directors.

Item

Current practices

2. Implementation of ethical corporate
management
(1)
Has the Company avoided
transactions with parties that have
a record of dishonest behavior,
stipulating in all contracts what
constitute unacceptable
behavior?
(2)
Has the Company established a
dedicated unit to promote ethical
corporate management under the
supervision of the Board of
Directors and regularly (at least
once a year) report to the board
its management policy and
implementation?
(3)
Has the Company set up policies
to prevent conflicts of interest and
provide channels to report such
conflicts?
(4)
Has the Company built an
effective accounting system and
internal control system to carry
out ethical corporate
management, and has the
internal auditor set up relevant
audit plans based on the results
of assessments of risks of
dishonesty and compliance with
the prevention plan, or delegated
the task to an accountant?
(5)
Has the Company conducted
regular internal and external
training courses on ethical
corporate management?

(1)
The
Company
provides
“Guidelines
on
Social
Responsibility for Suppliers” and requires all suppliers to
sign a “Declaration of Ethical Corporate Management,”
which states that suppliers must not engage in bribery;
otherwise, the Company has the right to suspend their
accounts and terminate or rescind their contracts any time.
(2)
(i) The Internal Audit Office and functional committees
were established under the Board of Directors to
supervise and audit the practices and implementation of
the Company’s ethical corporate management policy. In
addition, the Legal Office, which reports to the President
directly, is responsible for executing the policy, setting up
guidelines to prevent dishonest behavior and reporting to
the Board of Directors at least once a year to ensure the
implementation of the highest guiding principles for ethical
management.
(ii)To implement the ethical corporate management policy
and prevent unethical conduct, the Company has set up
Ethical Corporate Management Best Practice Principles
and Operation Rules of Ethical Corporate Management
Best Practice Principles.
(3)
(i) The Company has promulgated policies to prevent
conflicts of interest. If there is any proposal that might be
harmful to the interest of the Company, board directors
who have conflicts of interest with the Company shall
recuse themselves from discussing or voting on the issue.
Any board director, manager, employee and mandatary
must not use his/her position or influence in the Company
to obtain improper benefits for himself/herself or any other
person.
(ii)Any breach of ethical corporate management practices
can be reported via email or fax hotline to the Company.
(4)
(i) The Company has established an effective accounting
system and internal control system. In addition, the Audit
Office regularly analyzes and evaluates business activities
with a high risk of dishonest behavior through annual risk
assessment processes, and sets up an audit plan and
checks its execution, then reports the findings to the board
on a periodic basis.
(ii)The Company periodically delegates independent
accountants to audit its financial statements and to verify
the effectiveness of its internal control system.
(5)
The Company promotes the importance of Ethical
Corporate Management Best Practice Principles to
directors, managers, employees and appointees on an
annual basis to help them fully understand the need to
comply with such practices. The Company also conducts
related training courses (such as, compliance with integrity
management regulations, preventing insider trading and
money laundering, and protecting trade secrets and
personal information) upon request to strengthen
colleagues' awareness. From January 1, 2022 to February
25, 2023, a total of 8,507.4 training hours were held, with
32,511 participants.

Item	Currentpractices
3. Reporting ethical violations (1) Has the Company established a reporting and incentive system to facilitate the processing of complaints and assigned a person or unit to deal with the cases? (2) Has the Company set up investigation and confidentiality procedures? (3) Has the Company protected whistle-blowers from harm?	(1) The Company has established procedures for dealing with complaints about employees or suppliers, with the Internal Audit Office tasked with handling the cases. a) Supplier complaints can be filed with the Internal Audit Office in written form or via fax to (02) 6636- 1600. b) Employee complaints can be sent to a designated internal e-mail account. (2) The Internal Audit Office must immediately launch an investigation upon receipt of a complaint and ensure that the name and identity of the complainant are kept confidential. (3) The Internal Audit Office must be objective and fair in its investigation. It must report the results of its investigation directly to a higher supervisor and ensure that the whistle- blower is not harmed.
4. Has the Company strengthened information disclosure by posting related information on ethical corporate management and promoting its effectiveness on the Company’s website and MOPS?	The Company has posted its Ethical Corporate Management Best Practice Principles on its website and MOPS. Its annual report and 2022 ESG Report further shed light on its execution and enhance corporate transparency.
5. Has the Company promulgated its own ethical corporate management principles in accordance with the Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies? If yes, describe the differences between the principles and current practices: No difference.
6. Other important information to facilitate understanding of the Company’s implementation of ethical corporate management practices: (1) The Company’s electronic procurement system mandatorily requires suppliers to sign a Declaration of Integrity in Business Conduct every year; otherwise, they are not allowed to participate in the bidding process. (2) To improve its ethical corporate management policy, the Company regularly monitors local and international developments of relevant ethical corporate management standards. The Company has also amended its Ethical Corporate Management Best Practice Principles, which were approved by the Board of Directors on November 10, 2022.

Corporate governance rules and procedures

The Company has implemented a number of rules and procedures to enhance its corporate governance practices: Corporate Governance Best Practice Principles, Audit Committee Charter, Remuneration and Nomination Committee Charter, ESG Steering Committee Charter, Rules and Procedures Governing Board of Directors’ Meetings, Rules and Procedures Governing Shareholders’ Meetings, Regulations Governing Internal Material Information, Procedures Governing Applications to Suspend or Resume Trading, Code of Ethics, Ethical Corporate Management Best Practice Principles, Corporate Sustainable Development Policy, Corporate Sustainable Development Guidelines and Standard Operating Protocols for Responding to Requests from Directors. With these efforts, not only does the Company’s corporate governance mechanism comply with Taiwan’s Securities and Exchange Act, it also adheres to the highest international standards. The aforementioned charters and rules are available on the Company’s website: www.taiwanmobile.com.

Additional information on corporate governance operations:

Corporate governance principles

⚫ Timely disclosure of material information
⚫ Checks and balances between the board and management
⚫ Independent directors should comprise at least 40% of the board: Current ratio is 56%
⚫ Audit Committee was established to ensure fair and independent financial oversight
⚫ Remuneration and Nomination Committee was established to bolster corporate governance practices, promote a sound compensation system for directors and managers, and select candidates for directorships
⚫ ESG Steering Committee was established to promote the implementation of corporate social responsibility and sustainable operations
⚫ Adoption of a high cash dividend payout policy
⚫ Shareholders’ rights are guaranteed with the right to vote on all proposals at the annual general meeting or through an electronic voting system
⚫ Strict compliance with the Code of Ethics and Ethical Corporate Management Best Practice Principles, and establishment of an internal audit mechanism

To ensure that employees, managers and directors promote information transparency and timely disclosure, the Company holds annual training sessions to familiarize employees with the Regulations Governing Internal Material Information and have incorporated them into its internal control system to avoid insider trading risks.

Internal control system

1. Internal control mechanism

The Internal Audit Office is an independent unit with designated personnel who report directly to the Board of Directors.

⚫ It is responsible for the examination and assessment of the internal controls of the Company’s financial, sales, operations and management departments. All departments, including those of the subsidiaries, are subject to its audit.
⚫ Regular internal audits are executed according to an annual audit plan. Special audit projects are implemented as needed. These audits enhance internal control and provide timely recommendations for future improvements.
⚫ In accordance with corporate governance, audit reports are submitted on a regular basis and reviewed by the Chairman, as well as presented to the Audit Committee and the Board of Directors by the Chief Internal Auditor.
⚫ The Internal Audit Office also examines the mechanisms and results of self-evaluations by departments and subsidiaries to ensure strict implementation. In addition, it generates and consolidates related inspection reports for the President and the Board of Directors to evaluate the overall efficiency of existing internal control systems before generating an internal control system statement.

There are 12 dedicated internal audit staff members, including one supervisor in charge of the Internal Audit Office, whose responsibilities are detailed below:

Board of Directors

Internal Audit Office

Internal Audit Dept.

Supervise each business group’s establishment and implementation of internal control policies and procedures
Carry out audits of operational units and back offices, report audit results to management and track remedial measures
Monitor and examine the effectiveness and efficiency of self-assessments by relevant business groups and subsidiaries
Handle employee complaints

Technology Audit Dept.

Carry out audits of technology and the information technology unit, report audit results to management and track remedial measures
Monitor and examine the effectiveness and efficiency of self-assessments by relevant business groups
Handle supplier complaints
Coordinate the Risk Management Committee’s strategic planning and operation
Coordinate appropriate authorization guidelines and limitations, and compliance with laws and regulations

2. Has the Company delegated CPAs to review its internal audit system and issued an audit report? No.

3. Internal control statement

Internal Control Statement

Date: January 11, 2023

Taiwan Mobile (TWM) states the following with regard to its internal control system for the year 2022:

TWM is fully aware that establishing, operating and maintaining an internal control system are the responsibilities of its Board of Directors and management. TWM has established such a system to provide reasonable assurance in achieving objectives related to the effectiveness and efficiency of operations (including profits, performance and safeguarding of assets), reliability of financial reporting, and compliance with applicable laws and regulations.
An internal control system has inherent limitations. An effective internal control system, no matter how perfectly designed, can provide only a reasonable assurance in the accomplishment of the three goals mentioned above. Furthermore, the effectiveness of an internal control system may change along with changes in the environment or circumstances. The internal control system of the Company contains self-monitoring mechanisms and the Company takes corrective actions as soon as a deficiency is identified.
TWM evaluates the design and operating effectiveness of its internal control system based on the criteria provided in the Regulations Governing the Establishment of Internal Control Systems by Public Companies promulgated by the Securities and Futures Bureau, the Financial Supervisory Commission and the Executive Yuan (herein referred to as the “Regulations”). The internal control system evaluation criteria stated in the Regulations classify internal control into five key elements based on the process of management control: (1) Control environment, (2) Risk assessment and response, (3) Control activities, (4) Information and communications, and (5) Monitoring. (Please refer to the Regulations for details on these five key elements.)
TWM has evaluated the design and operating effectiveness of its internal control system according to the aforesaid criteria.
Based on the findings of the evaluation mentioned in the third paragraph, TWM believes that as of December 31, 2022, its internal control system (including its supervision of subsidiaries), which encompasses internal controls to achieve effective and efficient operations, reliable financial reporting, and compliance with applicable laws and regulations, was effectively designed and operating, and is reasonably assured of achieving the above-stated objectives.
This statement will form a major part of the Company's Annual Report and Prospectus and will be made public. Any falsehood, concealment, or other illegality in the content made public will entail legal liability under Articles 20, 32, 171 and 174 of the Securities and Exchange Act.
This statement has been passed by the TWM Board of Directors’ Meeting on January 11, 2023, where all of the nine attending directors did not express any dissenting opinion and affirmed the content of the same.

Taiwan Mobile Co., Ltd.

==> picture [191 x 32] intentionally omitted <==

Daniel M. Tsai Chairman

==> picture [75 x 39] intentionally omitted <==

Jamie Lin President

Violation of regulations and internal policies: None.

Major resolutions at the shareholders’ and board meetings

1. Major resolutions at the 2022 shareholders’ meeting

Issues approved and subsequent execution:

(1) 2021 business report and financial statements
(2) Distribution of 2021 earnings and cash return from capital surplus
Execution: Ex-dividend date was set for July 16, 2022, and cash payment of NT$4. 3 per share on August 3, 2022.
(3) Revisions to the Company’s Articles of Incorporation Execution: Approved by the Ministry of Economic Affairs on July 21, 2022, the revised rules were posted on the Company's website.
(4) Revisions to the Rules and Procedures Governing Shareholders’ Meeting Execution: Published on the Company’s website and MOPS on June 23, 2022.
(5) Revisions to the Rules and Procedures for Acquisition or Disposal of Assets Execution: Published on the Company’s website and MOPS on July 13, 2022.
(6) Removal of non-competition restrictions on board directors Execution: Published on MOPS on June 23, 2022.

2. Major resolutions by the board (from 2022 up to the publication date in 2023)

12th meeting of ninth BoD on January 25, 2022 (1) Approved the 2022 capital expenditure plan and donation to TWM Foundation
(2) Approved the 2022 guidance
(3) Approved executive personnel changes
(4) Approved the procurement of mobile broadband equipment
(5) Approved a proposal to participate in the NT$2.8bn new share issue of 100%-owned TWM Venture Co., Ltd.
13th meeting of ninth BoD on February 22, 2022
(1) Approved executive personnel changes
(2) Approved the 2021 business report and financial statements
(3) Approved the schedule for the 2022 annual general meeting
(4) Approved the acquisition or disposal of right-of-use assets
14th meeting of ninth BoD on May 6, 2022
(1) Approved executive personnel changes
(2) Approved the 2021 earnings distribution proposal and cash return from capital surplus
(3) Approved the 1Q22 financial statements
(4) Approved capex budget additions for 2022
(5) Approved the procurement of mobile broadband system
(6) Approved the establishment of the ESG Steering Committee
(7) Approved the acquisition or disposal of right-of-use assets
15th meeting of ninth BoD on June 16, 2022
(1) Approved a proposal to subscribe to LINE Bank Taiwan Ltd.’s common shares via a private placement
16th meeting of ninth BoD on August 1, 2022
(1) Approved the 2Q22 financial statements
(2) Approved executive personnel changes
17th meeting of ninth BoD on November 10, 2022
(1) Approved the 3Q22 financial statements
(2) Approved executive personnel changes
(3) Approved the acquisition or disposal of right-of-use assets
18th meeting of ninth BoD on January 11, 2023
(1) Approved the 2023 capital expenditure plan and donation to TWM Foundation
19th meeting of ninth BoD on February 24, 2023
(1) Approved the 2022 business report and financial statements

(2) Approved the adjustment of its share swap ratio for the merger with Taiwan Star Telecom Co., Ltd.
(3) Approved the issuance of unsecured straight corporate bonds
(4) Approved the schedule for the 2023 Annual General Meeting
(5) Approved a proposal to participate in the NT$3.1bn new share issuance of 100%-owned TWM Venture Co., Ltd.
(6) Approved the acquisition or disposal of right-of-use assets

The above information is posted on MOPS: https://mops.twse.com.tw.

Major dissenting comments over board meeting resolutions from 2022 up to the publication date in 2023: None

Resigned/discharged chairman, president, chief accounting officer, chief financial officer, chief internal audit officer, chief corporate governance officer and chief research officer:

arch officer:
				As of February25,2023
Title	Name	Date of taking office	Date of resignation	Reason for resignation/discharge
Vice President and Chief Information Officer	James Chang	2017/01/25	2022/01/01	Retirement
Executive Vice President and Chief Financial Officer	Rosie Yu	2014/04/29	2022/09/01	Retirement
Corporate Governance Officer	Rosie Yu	2019/04/30	2022/09/01	Retirement

Certified Public Accountant (CPA) Information

1. CPA service fees

Unit: NT$’000

Accounting firm	Name of CPA	Period covered by CPA’s audit	Audit fee	Non-audit fee (Note)	Total	Remarks
Deloitte & Touche	Pei-De Chen Te-Chen Cheng	2022.01.01~ 2022.12.31	7,890	2,940	10,830	-

Note: Fees for non-audit services were mainly for tax certifications, tax-related consultations and attestation services.

(1) For CPA changes, if the audit fee in the first year is lower than that of the prior year, specify the audit fee before and after the change and the reasons: Not applicable
(2) If the audit fee dropped by more than 10%, specify the amount and percentage of decline and reasons: Not applicable

2. Information on CPA changes:

(1) Former CPA

(1)Former CPA
Date of change	Approved by the Board of Directors on January 25, 2022
Reason for change	Due to job rotations at Deloitte & Touche from the fourth quarter of 2021
Specify whether services/engagement were terminated/refused	Party Conditions			CPA	Company
	Termination			Not applicable	Not applicable
	Refusal of new mandate			Not applicable	Not applicable
Has any audit opinion, other than an unqualified opinion, been issued in the past two years? If yes, cite reasons.	None
Disagreement with securities issuer	Yes		Accounting principles and practices
			Disclosure of financial statements
			Audit scope or procedures
			Others
	No	V
	Explanation: None
Other disclosure items	None

(2) Current CPA

(2)Current CPA
Name of company	Deloitte & Touche
Name of CPA	Pei-De Chen, Te-Chen Cheng
Date of engagement	Approved by the Board of Directors on January 25, 2022
Results of consultations with the CPA on accounting measures and principles that might influence his/her opinion prior to his/her engagement	None
Has the incumbent CPA issued any dissenting opinion on opinions issued by the previous CPA?	None

(3) The former CPA's response to the issues referred to in Article 10.6.1 and Item 3 of Article 10.6.2 of the Regulations Governing Information to be Published in Annual Reports of Public Companies: None

3. Company Chairman, President or finance/accounting manager held positions in the Company’s audit firm or its affiliates within the past year: None

Direct and indirect investments in affiliated companies

As of December 31, 2022

Unit: shares, %

					Unit: shares, %
Long-term investments under equity method (Note)	Investment by TWM		Investment by TWM’s directors, managers and its directly or indirectly controlled businesses		Total investment
	Shares	Holding (%)	Shares	Holding (%)	Shares Holding (%)
Taiwan Cellular Co., Ltd.	502,970,309	100.00	`－`	`－`	502,970,309 100.00
Wealth Media Technology Co., Ltd.	42,065,000	100.00	`－`	`－`	42,065,000 100.00
TWM Venture Co., Ltd.	433,051,035	100.00	`－`	`－`	433,051,035 100.00
Taipei New Horizon Co., Ltd.	191,865,500	49.90	`－`	`－`	191,865,500 49.90
Fu Sheng Digital Co., Ltd.	3,000,000	100.00			3,000,000 100.00
AppWorks Ventures Co., Ltd	2,167,500	51.00	1,708,500	40.20	3,876,000 91.20

Note: Investments accounted for using equity method

Changes in shareholdings of directors, managers and major shareholders

1. Minor changes in shareholder structure

				Unit:shares 2023 (as of February 25) Net change in shareholding Net change in shares pledged 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0	Unit:shares 2023 (as of February 25) Net change in shareholding Net change in shares pledged 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Title	Name	2022		2023 (as of February 25)
		Net change in shareholding	Net change in shares pledged	Net change in shareholding	Net change in shares pledged
Chairman	Fu Chi Investment Co., Ltd. Representative: Daniel M. Tsai	0	0	0	0
Director	Fu Chi Investment Co., Ltd. Representative: Richard M. Tsai
Director	Fu Chi Investment Co., Ltd. Representative: Chris Tsai
Director	TCC Investment Co., Ltd. Representative: Jamie Lin	0	0	0	0
Independent Director	Hsueh-Jen Sung	0	0	0	0
Independent Director	Char-Dir Chung	0	0	0	0
Independent Director	Hsi-Peng Lu	0	0	0	0
Independent Director	Tong Hai Tan	0	0	0	0
Independent Director	Drina Yue	0	0	0	0
Major Shareholder (shareholding of more than 10%)	TFN Union Investment Co., Ltd.	0	0	0	0
President	Jamie Lin	60,000	0	0	0
SVP and Chief TechnologyOfficer	Tom Koh	0	0	0	0
VP and Chief Data Officer	Eddie Chan	0	0	0	0
VP and Chief Information Officer	Rock Tsai (Took office on February 22, 2022)	0	0	0	0
VP and Chief Business Officer	Tony Lin (Took office on May 6, 2022)	0	0	0	0
VP and Chief Strategy Officer	Tim Lee	0	0	0	0
VP and Chief Financial Officer	George Chang (Took office on September 1, 2022)	0	0	0	0
Vice President	C.H. Wu	0	0	0	0
Vice President	Steve Chou	0	0	0	0
Vice President	Kate Chen	0	0	0	0
Vice President	JayHong	0	0	0	0
Vice President	ShirleyChu	0	0	0	0
Vice President	Joan Hung	0	0	0	0
Vice President	Ming-Tung Wu	0	0	0	0
Vice President	David Lin	0	0	0	0
Vice President	Naomi Lee	0	0	0	0
Vice President	Iris Liu	0	0	0	0

Vice President	Daphne Lee	0	0	0	0

Title	Name	2021		2022 (as of February 23)
		Net change in shareholding	Net change in shares pledged	Net change in shareholding	Net change in shares pledged
Vice President	Vincent Wu (Took office on August 1, 2022)	0	0	0	0
Vice President	Luke Han (Took office on December 1, 2022)	0	0	0	0
Chief Accounting Officer	Darren Shih	0	0	0	0
VP and Chief Information Officer	James Chang (Retired on January 1, 2022)	0	0	NA	NA
EVP and Chief Financial Officer	Rosie Yu (Retired on September 1, 2022)	0	0	NA	NA
Vice President	Michael Teng (Retired on November 1, 2022)	0	0	NA	NA

2. Shareholding transferred with related party: None

3. Stock pledged with related party: None

As of July 16, 2022

Relationship between TWM’s top 10 shareholders

					As of July 16, 2022	As of July 16, 2022
Name (A)	Current shareholding		Spouse’s/minor’s shareholding		Name and relationship between TWM’s top 10 shareholders who are defined as related parties, spouse or a relative within two degrees
	Shares	%	Shares	%	Name (B)	Relationship
TFN Union Investment Co., Ltd.	410,665,284	11.67%	–	–	TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Daniel M. Tsai Richard M. Tsai TCCI Investment and Development Co.,Ltd.	A and B have the same chairman A and B have the same chairman B’s chairman is a relative within two degrees of A’s chairman A and B have the same chairman B is A’s chairman B is a director at A A and B have the same chairman
Chairman: Daniel M. Tsai	95,162,715	2.70%	4,580,070	0.13%	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Richard M. Tsai TCCI Investment and Development Co.,Ltd.	A is B’s chairman A is B’s chairman A is B’s chairman A is a relative within two degrees of B’s chairman A is B’s chairman B is A’s relative within two degrees A is B’s chairman
Shin Kong Life Insurance Co., Ltd.	251,579,000	7.15%	–	–	None	None
Chairman: Bo-Jheng Pan	–	–	–	–	None	None
TCC Investment Co., Ltd.	200,496,761	5.70%	–	–	TFN Union Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Daniel M. Tsai Richard M. Tsai TCCI Investment and Development Co.,Ltd.	A and B have the same chairman A and B have the same chairman B’s chairman is a relative within two degrees of A’s chairman A and B have the same chairman B is A’s chairman B is a director at A A and B have the same chairman
Chairman: Daniel M. Tsai	95,162,715	2.70%	4,580,070	0.13%	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Richard M. Tsai TCCI Investment and Development Co.,Ltd.	A is B’s chairman A is B’s chairman A is B’s chairman A is a relative within two degrees of B’s chairman A is B’s chairman B is A’s relative within two degrees A is B’s chairman
Cathay Life Insurance Co., Ltd.	198,667,900	5.65%	–	–	None	None

Name (A)	Current shareholding	Current shareholding	Spouse’s/minor’s shareholding	Spouse’s/minor’s shareholding	Name and relationship between TWM’s top 10 shareholders who are defined as related parties, spouse or a relative within two degrees	Name and relationship between TWM’s top 10 shareholders who are defined as related parties, spouse or a relative within two degrees
	Shares	%	Shares	%	Name (B)	Relationship
Chairman: Tiao-Kuei Huang	–	–	–	–	None	None
Ming Dong Co., Ltd.	184,736,452	5.25%	–	–	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Daniel M. Tsai Richard M. Tsai TCCI Investment and Development Co., Ltd.	A and B have the same chairman A and B have the same chairman B’s chairman is a relative within two degrees of A’s chairman A and B have the same chairman B is A’s chairman B is a director at A A and B have the same chairman
Chairman: Daniel M. Tsai	95,162,715	2.70%	4,580,070	0.13%	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Richard M. Tsai TCCI Investment and Development Co., Ltd.	A is B’s chairman A is B’s chairman A is B’s chairman A is a relative within two degrees of B’s chairman A is B’s chairman B is A’s relative within two degrees A is B’s chairman
Fubon Life Insurance Co., Ltd.	150,880,400	4.29%	–	–	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Dao Ying Co., Ltd. Daniel M. Tsai Richard M. Tsai TCCI Investment and Development Co., Ltd.	B’s chairman is a relative within two degrees of A’s chairman B’s chairman is a relative within two degrees of A’s chairman B’s chairman is a relative within two degrees of A’s chairman B’s chairman is a relative within two degrees of A’s chairman B is a relative within two degrees of A’s chairman B is A’s chairman B’s chairman is a relative within two degrees of A’s chairman
Chairman: Richard M. Tsai	93,310,663	2.65%	5,086,496	0.14%	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Daniel M. Tsai TCCI Investment and Development Co., Ltd.	A is a director at B A is a director at B A is a director at B A is B’s chairman A is a director at B B is A’s relative within two degrees A is a director at B

Name (A)	Current shareholding	Current shareholding	Spouse’s/minor’s shareholding	Spouse’s/minor’s shareholding	Name and relationship between TWM’s top 10 shareholders who are defined as related parties, spouse or a relative within two degrees	Name and relationship between TWM’s top 10 shareholders who are defined as related parties, spouse or a relative within two degrees
	Shares	%	Shares	%	Name (B)	Relationship
Dao Ying Co., Ltd.	113,609,742	3.23%	–	–	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Daniel M. Tsai Richard M. Tsai TCCI Investment and Development Co., Ltd.	A and B have the same chairman A and B have the same chairman A and B have the same chairman B’s chairman is a relative within two degrees of A’s chairman B is A’s chairman B is a director at A A and B have the same chairman
Chairman: Daniel M. Tsai	95,162,715	2.70%	4,580,070	0.13%	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Richard M. Tsai TCCI Investment and Development Co., Ltd.	A is B’s chairman A is B’s chairman A is B’s chairman A is a relative within two degrees of B’s chairman A is B’s chairman B is A’s relative within two degrees A is B’s chairman
Daniel M. Tsai	95,162,715	2.70%	4,580,070	0.13%	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Richard M. Tsai TCCI Investment and Development Co., Ltd.	A is B’s chairman A is B’s chairman A is B’s chairman A is a relative within two degrees of B’s chairman A is B’s chairman B is A’s relative within two degrees A is B’s chairman
Richard M. Tsai	93,310,663	2.65%	5,086,496	0.14%	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Daniel M. Tsai TCCI Investment and Development Co., Ltd.	A is a director at B A is a director at B A is a director at B A is B’s chairman A is a director at B B is A’s relative within two degrees A is a director at B
TCCI Investment and Development Co., Ltd.	87,589,556	2.49%	–	–	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Daniel M. Tsai Richard M. Tsai	A and B have the same chairman A and B have the same chairman A and B have the same chairman B’s chairman is a relative within two degrees of A’s chairman A and B have the same chairman B is A’s chairman B is a director at A

Name (A)	Current shareholding	Current shareholding	Spouse’s/minor’s shareholding	Spouse’s/minor’s shareholding	Name and relationship between TWM’s top 10 shareholders who are defined as related parties, spouse or a relative within two degrees	Name and relationship between TWM’s top 10 shareholders who are defined as related parties, spouse or a relative within two degrees
	Shares	%	Shares	%	Name (B)	Relationship
Chairman: Daniel M. Tsai	95,162,715	2.70%	4,580,070	0.13%	TFN Union Investment Co., Ltd. TCC Investment Co., Ltd. Ming Dong Co., Ltd. Fubon Life Insurance Co., Ltd. Dao Ying Co., Ltd. Richard M. Tsai TCCI Investment and Development Co., Ltd.	A is B’s chairman A is B’s chairman A is B’s chairman A is a relative within two degrees of B’s chairman A is B’s chairman B is A’s relative within two degrees A is B’s chairman

Note: Shareholding percentage is calculated based on outstanding shares of 3,519,233,603 as of July 16, 2022.

Chapter 3 Financial Information

Capital and shares

Source of capital

As of February 25, 2023

						As of February 25, 2023	As of February 25, 2023	As of February 25, 2023
Date	Par value (NT$)	Authorized capital		Paid-in capital		Remarks
		Shares	Amount (NT$)	Shares	Amount (NT$)	Source of capital (NT$)	In a form other than cash	Cert. No. & effective date
Feb. 2022	10	6,000,000,000	60,000,000,000	3,519,233,603	35,192,336,030	Convertible bonds 57,134,640	: `－`	Authorization No. 1050043485 Nov. 7, 2016

As of February 25, 2023

				As of February 25, 2023
	Authorized capital			Remarks
	Listed shares	Unissued shares	Total
Common stock	3,519,233,603	2,480,766,397	6,000,000,000	None

Information related to shelf registration: None

Shareholder structure

As of July 16, 2022

	Government agencies	Financial institutions	Other institutions	Individuals	Foreign institutions & individuals	Total
No. of shareholders	7	24	406	64,243	887	65,567
Total shares owned	264,101,156	773,052,459	1,441,221,938	453,598,304	587,259,746	3,519,233,603
Holding percentage	7.50%	21.97%	40.95%	12.89%	16.69%	100.00%

Shareholding distribution

As of July 16, 2022

1. Common shares

Shareholding range	No. of shareholders	Total shares owned	Holding percentage
1~999	18,808	5,220,346	0.15%
1,000~5,000	37,614	74,082,129	2.11%
5,001~10,000	4,733	36,573,740	1.04%
10,001~15,000	1,330	16,819,568	0.48%
15,001~20,000	807	14,778,019	0.42%
20,001~30,000	690	17,620,523	0.50%
30,001~40,000	332	11,812,307	0.34%
40,001~50,000	206	9,511,324	0.27%
50,001~100,000	388	27,840,625	0.79%
100,001~200,000	210	30,388,480	0.86%
200,001~400,000	143	40,001,499	1.14%
400,001~600,000	52	24,647,157	0.70%
600,001~800,000	31	21,591,365	0.61%
800,001~1,000,000	24	21,935,691	0.62%
1,000,001 and above	199	3,166,410,830	89.97%
Total	65,567	3,519,233,603	100.00%

2. Preferred shares: None

Major shareholders

Major shareholders
		As of July 16, 2022
Name	Total shares owned	Holding percentage (Note)
TFN Union Investment Co., Ltd.	410,665,284	11.67%
Shin KongLife Insurance Co., Ltd.	251,579,000	7.15%
TCC Investment Co., Ltd. Ltd.	200,496,761	5.70%
CathayLife Insurance Co.,	198,667,900	5.65%
MingDongCo., Ltd.	184,736,452	5.25%
Fubon Life Insurance Co., Ltd.	150,880,400	4.29%
Dao YingCo., Ltd.	113,609,742	3.23%
Daniel M. Tsai	95,162,715	2.70%
Richard M. Tsai	93,310,663	2.65%
TCCI Investment & Development Co., Ltd.	87,589,556	2.49%

Note: Shareholding percentage was calculated based on outstanding shares of 3,519,233,603 as of July 16, 2022.

Share price, net worth, earnings, dividends and related information

			2021	2022	As of February 25, 2023
Share price (NT$)	High		109.50	110.50	98.50
	Low		95.50	90.40	93.80
	Average		99.85	101.19	96.05
Net worth per share (NT$)	Before earnings appropriation		23.23	22.86	`－`
	After earnings appropriation		18.93	(Note 1)	`－`
Earnings per share (NT$)	Adjusted weighted average outstanding shares (‘000 shares)		2,814,930		`－`
				2,820,482

	Earnings per share		3.90	3.91	`－`
Dividends per share (NT$)	Cash dividends		4.30	(Note 1)	`－`
	Stock dividends	`－`	`－`	(Note 1)	`－`
		`－`	`－`	(Note 1)	`－`
	Accumulated unpaid dividends		`－`	`－`	`－`

PE and dividend yield (Note 2)	Price earnings ratio(x)		25.60	25.88	`－`
	Price to cash dividend(x)		23.22	`－`	`－`
	Cash dividendyield(%)		4.31	`－`	`－`

Note 1: The appropriation amount for 2022 has yet to be approved at the AGM.

Note 2: Price earnings ratio = Average closing price / earnings per share Price to cash dividend = Average closing price / cash dividend per share Cash dividend yield = Cash dividend per share / average closing price

Dividend policy

1. Dividend policy under Articles of Incorporation

The dividend policy in general is to distribute earnings from retained earnings in the form of cash after deducting forecast capital expenditure. Should there be a stock dividend distribution, it should not exceed 80% of the total dividends distributed in a single year. The dividend payout proposed by the Board of Directors (BoD) has to be approved at the annual shareholders’ meeting.

2. Proposed dividend allocation for approval at annual shareholders’ meeting

The BoD has not yet approved the proposed dividend allocation for 2022 as of publication date. The board expects to approve the proposal 40 days prior to the AGM, and the related resolution will be announced on the Company’s website and MOPS.

3. The Company maintains a dividend policy with a high payout ratio

Historically, dividends distributed to shareholders were no less than 80% of retained earnings available for distribution for that year and composed of over 80% cash. A historical listing of dividends distributed is posted on TWM’s official website.

Impact of stock dividend distribution on business performance and EPS

The BoD has not yet approved the dividend allocation proposal for 2022 as of publication date.

Employees’ and directors’ compensation

1. Earnings distribution plan according to the Company’s Articles of Incorporation

If the Company posts an annual profit, it shall set aside 1% to 3% of the profit as employee bonuses and not more than 0.3% of the profit as compensation for directors. However, if the Company posts a loss, it shall first reserve a certain amount to offset the losses, then allocate the remainder for employee bonuses and directors’ compensation. Recipients are to include qualified employees of TWM subsidiaries.

2. Accounting treatment for the deviation between the estimated and actual distribution amount of employees’ and directors’ compensation

The Company accrues employee bonuses and directors’ compensation proportionally from the pre-tax income before deducting employee bonuses and directors’ compensation, and amounts reserved in advance. Should there be a deviation between the actual distribution amount and the accrued amount in the annual financial reports after the publication date, the difference should be treated as changes in accounting estimates and adjusted in the following year.

3. 2022 employees’ and directors’ compensation proposals adopted by the BoD

(1) Employees’ and directors’ compensation paid in the form of cash or shares and differences/reasons/treatments of accrued numbers if any:

The 2022 employee bonuses and directors’ compensation approved by the BoD on February 24, 2023 totaled NT$305.936 million and NT$30.594 million, respectively, in the form of cash, while the accrued amounts in the 2022 financial report are the same as the cash compensation.

(2) Employee bonuses paid in the form of shares and as a percentage of total net income on a stand-alone basis and of total employee bonuses: None.

4. Earnings distributed as employee bonuses and directors’ compensation in the previous year

Difference between the amount approved by the BoD and actual distribution of 2021 employee bonuses and directors’ compensation: None

Share buyback: None

Corporate bond issuance

Corporate bonds

Corporate bonds	Corporate bonds
				As of February 25, 2023
Issuance		Fifth Unsecured Corporate Bond	Sixth Unsecured Corporate Bond	Seventh Unsecured Corporate Bond
Issue date		April 20,2018	March 24,2020	July13,2021
Denomination		NT$10,000,000	NT$10,000,000	NT$10,000,000
Issuance and listing		Not applicable	Not applicable	Not applicable
Issueprice		100% ofpar value	100% ofpar value	100% ofpar value
Total amount		NT$15,000,000,000 Tranche A`：`NT$6,000,000,000 Tranche B`：`NT$9,000,000,000	NT$20,000,000,000 Tranche A`：`NT$5,000,000,000 Tranche B`：`NT$10,000,000,000 Tranche C`：`NT$5,000,000,000	NT$2,500,000,000
		Tranche A`：`0.848% p.a.	Tranche A`：`0.640% p.a.	0.530% p.a.
Coupon		Tranche B`：`1.000% p.a.	Tranche B`：`0.660% p.a.
			Tranche C`：`0.720%p.a.
Term		Tranche A：5 years, maturing on April 20, 2023 Tranche B：7 years, maturing on April 20, 2025	Tranche A：5 years, maturing on March 24, 2025 Tranche B：7 years, maturing on March 24, 2027 Tranche C：10 years, maturing on March 24,2030	7 years, maturing on July 13, 2028
Guarantor		None	None	None
Trustee		Bank of Taiwan	Bank of Taiwan	Bank of Taiwan
Underwriter		Yuanta Securities Co.,Ltd.	KGI Securities Co.,Ltd.	Fubon Securities Co.,Ltd.
Legal counsel		Jim Chen,Attorney	Jim Chen,Attorney	Ariel Hwang,Attorney
		Li-wen Kuo, CPA	Li-wen Kuo, CPA	Li-wen Kuo, CPA
Auditor		Kwan-chuang Lai, CPA	Kwan-chuang Lai, CPA	Kwan-chuang Lai, CPA
		Deloitte & Touche	Deloitte & Touche	Deloitte & Touche
Repayment		Bullet repayment	Bullet repayment	Bullet repayment
Outstandingbalance		NT$15,000,000,000	NT$20,000,000,000	NT$2,500,000,000
Earlyrepayment clause		None	None	None
Covenants		None	None	None
Credit rating agency, rating date, company credit rating		None	None	None
	Amount
	converted/
	exchanged into
	common	Not applicable	Not applicable	Not applicable
	shares, ADRs
Ancillary	or other
	securities
rights

	Rules governing
	issuance or
	conversion	Not applicable	Not applicable	Not applicable
	(exchanged or
	subscription)

Dilution and other effects on shareholders’ equity		Not applicable	Not applicable	Not applicable
Custodian		Not applicable	Not applicable	Not applicable

Convertible bond information: None

Exchangeable bonds: None

Shelf registration issuance: None

Bonds with warrant: None

Preferred shares: None

Depositary receipt issuance: None

Employee stock options and new restricted employee shares: None

Shares issued for mergers and acquisitions:

Completed mergers and acquisitions: None
Board of Directors’ resolution:
Taiwan Mobile’s Board of Directors reached a resolution to merge Taiwan Star Telecom Co., Ltd. (T Star) on December 30, 2021. The share exchange ratio was adjusted to one T Star share for 0.03260 TWM shares on February 24, 2023. The National Communications Commission (NCC) conditionally approved the Company’s merger with T Star on January 18, 2023.The merger still requires regulatory approval from the Fair Trade Commission and the Taiwan Stock Exchange. The surviving entity would be Taiwan Mobile, while T Star would be dissolved. The merger would be value accretive to shareholders.

Mergers and acquisitions:

rs and acquisitions:	rs and acquisitions:	rs and acquisitions:
Name of the company			Taiwan Star Telecom Co., Ltd.
Address of the company			6F, No. 239, Tiding Avenue, Sec. 2,Neihu District,Taipei
Responsible person			Lin Ching-Tang
Paid-in capital (NT$)*			62,600,806
Mobile service/product lines			Telecommunications industry, etc.
Financial data (Unit: NT‘000)	June 30, 2022	Total assets	59,492,453
		Total liabilities	36,321,421
		Total shareholders’ equity	23,171,032
	For the six months ended June 30, 2022	Operatingrevenue	5,964,731
		Grossprofit	1,039,297
		Operating profit and loss	(866,020)
		Net income(loss)	(1,278,260)
		EPS(NT$)	(0.21)

*Source: T Star 2Q 2022 financial report

Use of proceeds from rights issue: None

Chapter 4 Operational Highlights

Performance by division

	Consumer Business Group	Consumer Business Group	Enterprise Business Group	Home Business Group		Retail Business
Brand name	Taiwan Mobile		Taiwan Mobile Enterprise Services	TWM Broadband		momo
Services	⚫Voice, data and mobile value-added services for consumers		⚫Voice and data mobile services for enterprises ⚫Fixed-line services ⚫Cloud and enterprise total solutions	⚫Pay TV services (CATV/DTV) ⚫Cable broadband services ⚫Others	⚫ ⚫	E-commerce TV home shopping
						Unit: NT$mn
		Telecom business		Cable TV business		Retail business
		Mobile business	Fixed-line broadband business
Market position		One of top three mobile operators in a five- player market, with a market share of around 24% in terms of mobile subscribers (excluding 040 prefix)	One of top three internet service providers (ISP)	Fourth-largest multiple system operator (MSO), covering about 11% of households in Taiwan		Ranked first in B2C e-commerce
2022 revenue*		65,692		6,333		103,436
2022 EBIT*		10,134		2,170		4,285

Source: 2022 financial reports. The difference between the sum of each division and consolidated numbers was due to interdivisional adjustments and eliminations.

Scope of Business

Business overview

Telecom Business

1. Telecom products and services

Consumer Business Group

Besides providing customers mobile voice and data services, the Consumer Business Group also offers diversified valueadded services and exclusive games and devices. These value-added services include video and music streaming, online cloud gaming, mobile devices, instant messenger, IoT-related services, and smart home services. In October 2022, the Company launched “OP Life” – a one-stop integrated service – to give users the ultimate innovative audiovisual experience.

Enterprise Business Group

The Enterprise Business Group offers a full range of one-stop services to corporate clients. Aside from providing basic telecommunication services, the Enterprise Business Group can also serve as an enterprise’s partner in the fields of 5G solutions, cloud services, IoT and information security.

2. Telecom revenue breakdown

Unit: NT$mn

	Unit: NT$mn	Unit: NT$mn
Year Item	2022
	Revenue	% of total
Service revenue	46,508	71%
Device sales	19,184	29%
Total	65,692	100%

3. New telecom products and services

Consumer Business Group

(1) OP Life one-stop solution: Offer “Gamer” mobile game/VR device packages; adopt Matter connectivity standards to offer better Smarter Home packages.
(2) momo ecosystem: Deepen cooperation with the installation of a TWM e-shop on momo’s platform, offering exclusive

“momobile member’s day” deals for TWM users and facilitating purchases of devices and accessories using momo coins on myfone stores.

(3) Diversified metaverse experience: MyMoji booths allow users to create their own 3D interactive avatar that they can use on popular apps on TWM’s platform.

Enterprise Business Group

(1) Multi-cloud and hybrid cloud solutions:

By combining telecom services, Smart IT service and public cloud, TWM provides solutions to help customers build private cloud services using TWM’s data center for their production environment while deploying public cloud services such as AI and SaaS for related application development and testing.

(2) AI and industrial solutions:

TWM continues to cooperate with partners in the industrial ecosphere and is working on becoming a Tier 1 Amazon Web Services (AWS) Partner Network. The Company has launched manufacturing data governance solutions with CloudMile to provide data monitoring, analysis and cloud AI solutions, such as preventive maintenance and detecting abnormal activities. In addition, it has collaborated with Cadmen and Rescale to create a one-stop "industrial simulation solutions" based on Taiwan Cloud Computing (TWCC) services, as well as provide a One AI platform to help developers

quickly prepare data, build models, and achieve efficient deployment and maintenance operations and landing applications.

(3) 5G/Internet of Vehicles:

TWM works with private 5G vertical application partners to develop private 5G dedicated and shared services. Moreover,

it has bolstered its partners’ commercial promotions to boost their market share in IoV and continue to develop new IoT platform services (IoTBS, IoTA, eSIM).

Cable TV and Broadband (Home Business Group)

1. CATV products and services

Its main operations cover a variety of products and services, including cable TV, HD digital TV, high-speed fiber-optic internet access, over-the-top (OTT) service platform, HomeSecurity services, A1 Box and digital TV channel content agency.

2. CATV revenue breakdown

Unit: NT$mn

Year Item		2022
	Revenue	% of total
Pay TV service	3,155	50%
Cable broadband service	1,943	31%
TV content agency and others*	1,235	19%
Total	6,333	100%

Including channel leasing revenue

3. New CATV products and services

(1) HD digital TV services:

TWM has led the industry in ushering in a whole new era in home entertainment with its introduction of 4K content and multi-angle vision.

(2) High-speed fiber-optic internet access services:

Given the increasing demand for high-speed internet access, TWM Broadband launched its 1Gbps+WiFi 6 and Mesh

WiFi 6 service, and aims to offer even faster access in the near future.

(3) Digital home services:

The Company is developing multiple value-added services, such as IoT, cloud games and smart home applications.

Retail Business (momo.com Inc. or “momo”)

1. Retail products and services

momo offers e-commerce and TV home shopping services:

(1) e-commerce

momo sells over 4 million stock keeping units (SKUs), a quarter of which offer 24-hour delivery guarantee. It also provides

24-hour online customer service and a supplier contact platform to satisfy customers’ shopping needs.

(2) TV home shopping

momo has its own professional studio and filming team that provides momo TV programs to 5 million cable TV and 2.1 million MOD households nationwide.

0800 toll-free hotline and mobile app allow consumers to purchase products featured on momo TV programs or the momo

TV app. A customer service team works around the clock to answer questions about product features, as well as purchase and return policy.

2. Retail revenue breakdown

Retail revenue breakdown
		Unit: NT$mn
Year Item		2022
	Revenue	% of total
E-commerce	98,607	95%
TV home shopping and others	4,829	5%
Total	103,436	100%

3. New categories and services

(1) momo has continued to introduce more international brands and to enhance long-term relationships with brand partners.

With the aid of key opinion leaders, live-streaming, social commerce marketing and cross-selling within Fubon Group, momo has added new categories, such as books and fresh food, to boost sales. Its TV home shopping platform has also developed new product categories, and introduced more overseas niche products to enhance its unique platform and broaden its customer base.

momo has stepped up its logistics network build-out to accelerate last-mile delivery to offer customers greater convenience. In terms of mobile device application, momo introduced AI technology to enhance visual and voice searches, as well as to enhance information security.

(2) momo’s TV home shopping business has steadily adapted to changes in consumer lifestyle and trends. To enhance engagement with its client base and boost customer stickiness, it has expanded its TV fan clubs’ operations, launched a TV app, broadcast live-stream videos on Facebook, and listed on Chunghwa Telecom’s MOD. It has also laid out plans for cooperation with livestreaming influencers and major OTT operators.
(3) momo plans to set up logistics centers in southern and central Taiwan to improve shipping efficiency.

Industry overview

Consumer Business Group

1. Industry status and development

It has been almost three years since 5G’s launch. The heavy investment in 5G network buildout has peaked, but there is still no 5G killer app.

The mergers of Taiwan Mobile and Taiwan Star and Far EasTone and Asia Pacific Telecom are still waiting for regulatory approval. Once approved, they could reduce pricing competition.

2. Industry value chain

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

Telecom equipment
and system vendors
Users
Application service TWM
providers
Distribution
Handset and device channels/agents
makers
Domestic/overseas carriers
----- End of picture text -----

3. Product development trends and competitive landscape

The three major operators are focused on upgrading users’ contribution to increase revenue. Industry consolidation when the two proposed mergers are approved could lead to the withdrawal of low-tier unlimited data plans. The 5G competition would switch to smart home, IoT, exclusive devices and streaming/video services.

Enterprise Business Group

1. Industry status and development

The COVID-19 pandemic has changed the way we work and live, spurring new developments in communications technology, as demand for cloud, IoT and information security services increased. These changes have ushered in more business opportunities for telecom companies.

2. Industry value chain

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

Telecom equipment
and system vendors
TWM
System integrators Enterprise
Enterprise
Application platform
users
providers Services
Distribution channels /
Content providers agents
Domestic / overseas carriers
----- End of picture text -----

3. Product development trends and competitive landscape

In the enterprise market, telecom operators face competition not only from traditional service providers, but also from other industries. The promotion of 5G development during the COVID-19 pandemic has also given rise to various innovative vertical application business opportunities, including IoT, smart factories, smart healthcare, smart retail and smart cities, underscoring the growing importance of cross-disciplinary cooperation.

Home Business Group

1. Industry status and development

Cable TV faces challenges from alternative services, such as IPTV, digital terrestrial TV and other emerging media (e.g., OTT video streaming) that have successively entered the market. The cable TV industry is facing a critical period of transformation.

2. Industry value chain

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

Content
Content/channel
providers System operators (SO) Channel and program
aggregators /
(TFN Media’s SOs) content recipients (viewers)
distributors
Channel
distributors
Cable internet access services
----- End of picture text -----

Aided by its control over last mile access to customers, TWM Broadband is aiming to take the lead in vertical integration to build up its core competitiveness and explore new business opportunities in the digital age.

3. Product development trends and competitive landscape

Fixed broadband is a saturated market that is dominated by Chunghwa Telecom and characterized by slowing growth. Technological advances and the demand for 5G indoor coverage have also spurred intense competition on price and speed. Furthermore, with the CATV industry becoming fully digitalized, user demand for high-definition digital TV channels and OTT content has increased. 4K content and smart home applications, such as internet-connected and voice control devices, are the future trends.

Retail Business

1. Industry status and development

As a leader in the B2C market, momo continues to build up its logistics and warehousing system, providing fast delivery services and a one-stop shopping experience for consumers, while expanding its economies of scale and raising barriers to entry in the B2C industry.

2. Industry value chain

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

Suppliers momo
Daily necessities, beauty and E-commerce platform Members /
personal care, travel, and other TV home shopping platform General consumers
products and services
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momo sources its products from suppliers and sells them through its TV home shopping networks, online shopping sites and mail order catalogues for members and general consumers.

3. Product development trends and competitive landscape

(1) E-commerce: Competition is no longer limited to e-commerce channels. Fast delivery and cold chain logistics services are

maturing. Groceries have become a new focus of competition between e-commerce platforms and hypermarket chains.

(2) TV home shopping: The rise of virtual shopping platforms, such as e-commerce and mobile commerce, has intensified competition in TV home shopping. momo has countered this challenge by collaborating with key opinion leaders or influencers, launching its own mobile apps and leveraging its social platform and capabilities, including livestreaming, to bolster engagement with members and its customer base.

Research and development expenditure

Research and development expenses totaled NT$391.273 million in 2022 and NT$36.79 million in January 2023. Continued investment in the research and development of more advanced technologies is expected to increase customer satisfaction, which in turn should boost value-added service revenue and overall operations growth.

Major research and development achievements

Project name	Description
Deep learning-based acceleration technology for ray-tracing model	Apply deep-learning technique on ray-tracing model to accelerate the estimation of 3D building images’ effect on a base station’s coverage and received signal strength.
myVideo	Develop 5G video applications such as selectable multiple streams on one screen. Adopt watermarking solution to enhance streaming video security.
MyMusic	Cooperate with other telecom operators to expand sales channels. Work with strategic partner SoundOn to enrich Podcast service content. Build a gamification marketing platform to attract young people using MyMusic.
Number masking service	Enrich communication platform as a service (CPaaS) application programming interfaces for various integration scenarios. Introduce number masking service to transportation industry.
Intelligence overdue collection model	Use AI machine learning algorithms to optimize overdue collection process.
AI optical character recognition (OCR) for Chinese handwriting	Develop a Chinese handwriting recognition mechanism using AI OCR technology and 13,500+ traditional Chinese handwriting datasets.
myfone online service	Design a customer-centric self-service system that encourages users to subscribe to and purchase TWM products online.
M+ Messenger	Improve office collaboration functions and integrate cloud PBX to enrich voice communication for enterprise customers.
Phone number tokenization and management regulations	Convert consumers’ phone numbers into tokens to protect personal data, as well as enable suppliers and logistics providers to contact buyers during the delivery process.

Sales development plans

Consumer Business Group

1. Short-term plan

(1) The Company has developed more OP Life packages, such as Gamer by bundling mobile/VR gaming and devices, and Smarter Home with Matter devices. These packages are expected to drive ARPU higher and increase customer loyalty.
(2) The Company offers diversified and exclusive services such as Disney+ and YouTube Premium to expand its 5G competitive advantages and grow its 5G customer base. The Company will keep on investing in exclusive content for MyVideo to enhance product differentiation.
(3) The Company has strengthened cooperation with momo to provide unique 5G packages. A TWM e-shop will be built on the momo platform and a “momobile members’ day” will be set for TWM users. The Company also plans to expand channels that accept momo coins to enlarge its ecosystem.
(4) As the agent of League of Legends PC game, the Company is exploring business opportunities and expanding its customer base in the gaming industry. Another collaboration involves bundling GeForce Now with Logitech’s G Cloud device.

2. Medium to long-term plan

(1) Become a smart home leader: The Company’s “Taiwan Mobile Smarter Home” brand strives to provide integrated services by offering a better network environment, smart appliances and smart devices to users. For individual consumers, the Company creates holistic solutions including products, services, and channel; and for enterprise customers, the Company aims to become a core partner for smart housing companies.
(2) Develop metaverse industries, social media platforms and hardware information related to virtual reality (VR), augmented reality (AR), mixed reality (MX) and extended reality (XR). The Company is open to opportunities for cooperation, aiding users in exploring metaverse through their own digital avatars by creating new application services on Web3.

Enterprise Business Group

1. Short-term plan

(1) Actively develop solutions for the manufacturing, retail, medical care, finance and government sectors, and integrate 5G technology and partner application services to promote industrial innovation and upgrading.
(2) Promote cloud services to meet the needs of enterprises.
(3) Implement sustainable value in the process of enterprise product promotion and cultivate brand ESG development.

2. Long-term plan

(1) Actively expand the industrial ecosystem, launch innovative vertical integration solutions that meet different industries' requirements, improve enterprise customers' operating efficiency, and expand TWM’s presence in foreign markets.
(2) Continue to develop diversified cloud services and accelerate the practical applications of AI to help corporate customers speed up their digital transformation.
(3) Improve sales growth productivity and strengthen the relationship between customers and TWM products.

Home Business Group

1. Short-term plan

(1) TWM Broadband will continue to optimize its network infrastructure in regions where it is already operating CATV systems and provide more HD digital content and video on demand to set the foundation for its digital services.
(2) TWM Broadband launched 1Gbps super high-speed internet access service and HD digital TV service to boost its cable broadband and digital TV service penetration rates, as well as increase its ratio of high-speed broadband internet users.

2. Long-term plan

The Home Business Group plans to integrate HD digital content, multiple-viewing terminal devices, high-speed fiber-optic internet access services and cloud technology to introduce more innovative and value-added digital TV services, allowing families and individual subscribers to enjoy the benefits of “multi-screens and a cloud” (i.e., mobile phones, PCs, tablets and TVs) and experience smart living.

Retail Business

1. Short-term plan

(1) E-commerce: Provide differentiated and value-added services by leveraging big data analysis to optimize product portfolios and recommend more personalized products to customers; deepen cooperation between momo and leading brands; and integrate offline and online loyalty programs.
(2) TV home shopping: Enhance distribution channel’s competitiveness by listing more branded products from overseas, cultivating fan bases on social platforms, such as Facebook and LINE, and cooperating with e-commerce suppliers to expand product offerings.

2. Medium to long-term plan

(1) E-commerce: Increase market share to further dominate B2C market by implementing a multi-channel sales strategy, optimizing search functions, facilitating short-chain logistics efficiency, and improving user experience (UX) and user interface (UI).
(2) Take a pro-active approach in raising momo’s brand image, further explore Asia’s TV shopping market, export bestselling products across multiple countries, leverage the group’s marketing resources and sales channels to enhance operating efficiency, and provide innovative services through mobile and cloud platforms.

Market and Sales Overview

Market analysis

Consumer Business Group

1. Main products and service areas

The Company provides nationwide and international roaming services. The coverage includes Taiwan and the outlying islands of Kinmen and Matsu.

2. Market status

As of October 2022, the mobile subscription penetration rate had reached 129.2%. Although it is a mature market, 5G’s commercialization offers exciting opportunities as demand for IoT, broadband, smart devices and value-added services surges.

3. Competitive advantages

(1) The Company provides integrated and diversified telecom-cable-e-commerce rate plans to increase users’ stickiness and build a win-win ecosystem.
(2) The Company has launched various services based on customers’ usage scenarios to solve their pain points, such as multiple OTT-video and music streaming, online cloud gaming, and rate plans combined with e-commerce consumption rewards. It has also integrated various technical services and devices to provide a one-stop service aimed at enhancing service value and brand differentiation.

4. Opportunities and challenges

Positive factors

(1) Diversified 5G applications should boost value-added services and increase revenue.
(2) With the rise of the lazy economy, a one-stop integrated service can solve users’ pain points and increase brand value.
(3) Smart home trend and an aging society should open up new business opportunities, such as home security.

Negative factors

(1) Limited knowledge and low involvement of smart home.
(2) The cost of IoT production is still high, and users are unwilling to pay a high price for it.
(3) Metaverse is a popular theory, but there is no killer app or service yet.

Countermeasures

(1) The Company plans to attract potential users with Google’s brand power to encourage them to upgrade to smart home. (2) The Company is cooperating with more Taiwanese home appliance brands, helping them convert their products into IoT and co-developing the smart home market.
(3) MyMoji provides cross-domain service and lets user get a taste of metaverse.

Enterprise Business Group

1. Main products and service areas

Taiwan Mobile Enterprise Services provides international services in 247 countries. As of the end of 2022, its roaming services included the following: 3G: 183 countries, 353 networks; 4G: 122 countries, 215 networks; 5G: 56 countries, 82 networks.

2. Market status

According to IDC's "2022-2026 Asia-Pacific (excluding Japan) 5G Enterprise Service Forecast" report, the Asia-Pacific (excluding Japan) 5G enterprise service market is rapidly growing, and 5G service revenue would reach US$8 billion in 2026, with a compound annual growth rate of 137%. IDC’s forecast of Taiwan’s top 10 ICT trends in 2023 include enterprises accelerating digital transformation and development, international political tensions accelerating the implementation of AI, digital twins and cloud services, and demand for information security services rising.

3. Competitive advantages

(1) Premium brand equity and customer relationship: Taiwan Mobile Enterprise Services is a brand under Taiwan Mobile. It actively responds to customer needs and designs one-stop services for enterprises to help them create maximum benefits for their customers. Taiwan Mobile Enterprise Services has won widespread recognition among major corporations.
(2) Professional management team and efficient support unit: Taiwan Mobile Enterprise Services has experienced sales and logistics teams, as well as extensive corporate group resources. Its cloud IDC server room has received Uptime Tier III certifications for design, construction and operational sustainability.
(3) Industry ecosystem partner resources: The Company effectively integrates the advantages of partners and creates customized industry solutions for corporate customers.

4. Opportunities and challenges

Positive factors

(1) The COVID-19 pandemic has accelerated the digital transformation of enterprises. A telecom company has the advantage of having an existing communication network infrastructure, which can drive and take advantage of the demand for cloud and information security services.
(2) IMC’s top 10 global trends forecast for 2023 sees the rising emphasis on net zero emissions, sustainable ESG and digital transformation. As the Company has actively invested in sustainable management and possesses comprehensive tools for enterprise digital transformation, it is well-positioned to seize market opportunities.

Negative factors

(1) The popularity of mobile data has seen local and long-distance calls replaced by free communication software.
(2) Chunghwa Telecom has fixed network services and scale advantage.

Countermeasures

The Company will continue to pursue innovation, strengthen vertical integration capabilities, develop cross-field alliance opportunities, and cooperate with partners in various fields to create industrial vertical integration solutions, as well as more comprehensive 5G, cloud, IoT and information security services, and work with customers to carry out digital transformation and strengthen customer adhesion.

Home Business Group

1. Main products and service areas

TWM Broadband’s main service areas are New Taipei City’s Xinzhuang and Xizhi districts, Yilan County and Kaohsiung’s Fongshan District among others.

2. Market status

(1) Cable TV: Taiwan’s CATV penetration rate has reached over 50% of households, according to NCC data. Watching

TV is a major leisure activity in Taiwan – one that is relatively unaffected by fluctuations in the economy. However,

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intensifying competition from cable system operators (SO), Chunghwa Telecom’s MOD system and OTT content providers has affected market pricing.

(2) HD digital TV and broadband internet access: Thanks to rich HD content, stable and quality signals, expanding platforms for viewing TV programs, and rapid development of online video services and social media, the demand for HD digital TV and high-speed broadband Internet access has continued to increase.

3. Competitive advantages

(1) TWM offers high-speed broadband network and WiFi 6 transmission which, coupled with its rich digital content and value-added services, should drive digital TV revenue growth.
(2) The Company can leverage off the group’s rich and varied resources to offer innovative digital convergence products and services.

4. Opportunities and challenges

Positive factors

(1) High-speed broadband internet service has become the mainstream.
(2) Demand for multi-screen viewing of video content has increased, demonstrating the growing importance of digital convergence for families.
(3) Backed by a solid base in smart home applications, TWM leads the industry in launching comprehensive services, such as A1 Box and HomeSecurity services.

Negative factors

(1) At its 840th meeting on Jan. 23, 2019 the NCC approved proposed changes to Chunghwa Telecom’s operation of its multimedia content transmission platform, allowing the company to form its own channel packages, as well as add or remove channels, for its MOD system. The changes place cable TV operators at a disadvantage as they must still obtain the NCC’s approval to switch channels, while their pricing schemes have to be reviewed by city/county governments on an annual basis. This unequitable competition could have an impact on the cable TV industry’s future.
(2) The competitiveness of cable system operators (SO) expanding their service areas has been ebbing. However, they still pose a risk of subscriber losses for TWM.
(3) The TV industry is facing operational difficulties due to the rise of OTT platforms and unauthorized set-top boxes.

Countermeasures

(1) TWM Broadband is observing developments in Taiwan’s digital content industry and global industry trends, focusing on providing a richer assortment of digital channels and connected TV content.
(2) With the launch of A1 Box – an open platform integrating cable TV channels and diverse OTT content – and 1Gbps+WiFi 6 service, TWM Broadband offers Smarter Home service, GeForce NOW cloud gaming, Disney+, etc.

Retail Business

1. Main products and service areas

momo mainly provides e-commerce and TV home shopping services in Taiwan.

2. Market status

B2C e-commerce topline growth is accelerating, bolstered by share gains from offline and continued expansion in mobile and streaming platforms.

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3. Competitive advantages

(1) Scale benefit: momo is the largest B2C e-commerce in Taiwan and continues to widen its gap with rivals. Its bargaining power has increased, and more and more first-tier brands are doing direct business with it, broadening its offerings of high-quality products.
(2) Solid reputation: momo has built a solid reputation among suppliers and customers in the TV home shopping industry. Besides winning customers’ confidence, it has enhanced suppliers’ willingness to entrust their brands to the Company, boosting its product diversity.
(3) Strong support from the group: momo is able to leverage the resources of affiliates to create opportunities in digital convergence, mobile platforms, mobile payment mechanisms and warehouse management system.

4. Opportunities and challenges

Positive factors

(1) Mobile usage time and mobile shopping continue to increase.

Negative factors

(1) High product homogeneity and intensifying market competition have led to margin pressure.
(2) Risk management of product quality and food safety is increasingly important as momo’s scale continues to increase.

Countermeasures

(1) momo has an extensive system of suppliers and a professional product development team. This facilitated its expansion into mobile and streaming platforms, as it already has a trove of best-selling products to tap into, which not only prolonged their product life cycle, but also increased sales volumes and differentiated it from the competition.
(2) momo has an online shopping mobile app to tap into the mobile commerce market and optimize customer experience. By promoting limited time and livestream promotions, momo is able to reach more consumers and stimulate buying willingness. The mobile platform also offers convenience, encouraging consumers to increase their shopping frequency.
(3) momo has set up a quality control team to visit new suppliers’ factories, outsource product testing to reduce food safety risks, filter out controversial products and clarify supplier responsibility to provide consumers with a safe place to shop.

Main features and production process of major products:

The Company provides wireless/fixed-line telecom services, digital TV subscription, cable broadband, e-commerce/TV home shopping, and integrated information and communication services.

Supply of raw materials: Not applicable as the Company is not a manufacturer.

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Major suppliers and customers in the past two years

- A supplier/customer that accounts for at least 10% of consolidated procurement/revenue

1. Major suppliers

1. Major suppliers	1. Major suppliers	1. Major suppliers	1. Major suppliers	1. Major suppliers	1. Major suppliers	1. Major suppliers	1. Major suppliers	1. Major suppliers
Unit: NT$’000
	2021				2022
	Company	Procurement amount	As a % of 2021 total net procurement	Nature of relationship	Company	Procurement amount	As a % of 2022 total net procurement	Nature of relationship
1	Company A	13,111,786	12	Third party	Company A	13,176,835	11	Third party
	Others	95,569,791	88		Others	111,443,330	89
	Total	108,681,577	100		Total	124,620,165	100

2. Major customers:

Not applicable as the Company’s revenue from a single customer did not exceed 10% of its consolidated operating revenue.

3. Reasons for variation

Procurements from suppliers varied as the Company purchased handsets from different vendors to meet its business development needs and market demand.

Production volume in the past two years: Not applicable as the Company is not a manufacturer.

Sales volume in the past two years

Sales volume	in the past two years
	Services	2021		2022
		Sales volume	Revenue (NT$’000)	Sales volume	Revenue (NT$’000)
Mobile	Mobile services (‘000 subs at year-end)	7,270	40,216,905	7,482	41,202,847
Domestic fixed telephony	Local calls (‘000 minutes)1	233,294	443,466	215,900	435,182
	Long distance calls (‘000 minutes)1	77,488	51,738	69,246	47,206
International fixed telephony	International calls (‘000 minutes)1	27,997	485,141	18,973	484,963
Fixed-line data transmission (‘000 lines)		243	2,652,809	290	2,845,478
Sales revenue2		NA	104,122,968	NA	118,931,066
Others		NA	8,136,506	NA	8,259,370
Total			156,109,533		172,206,112

1: Outgoing minutes only.

2: Including retail sales of handsets, accessories, IT products and 3C home appliances.

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Human Resources

Employee statistics in the past two years up to the publication date

Year	Year	2021	2022	2023 (as of February 25)
Number of employees	Consolidated	8,925	9,389	9,351
	Stand-alone	3,739	3,824	3,807
Education level	Ph.D.	0.17%	0.17%	0.16%
	Master’s	12.80%	12.68%	12.79%
	University	60.74%	60.93%	60.82%
	College	14.39%	13.63%	13.75%
	Others	11.90%	12.59%	12.48%
Average age		38.27	38.57	38.72
Average years of service		8.32	8.37	8.47

Environmental Protection Expenditure

Loss or penalty due to environmental pollution in 2022 up to the publication date in 2023

None.

Countermeasures:

TWM has taken into consideration any potential risks or breach of environmental regulations in formulating its environmental management system. The Company also closely monitors developments in the government’s environmental policies or regulations to design precautionary measures. It does not expect any substantial expenditure arising from environmental pollution. The Company is committed to protecting the environment and has adopted various measures, such as promoting green procurement, establishing energy-efficient base stations and data centers, minimizing the use of water and paper in offices and stores, exchanging old devices for new ones, recycling waste cables, batteries and handsets, and encouraging users to switch to e-billing and online services.

Employee Relations

Employee behavior/ethical standards

The Company has established policies and rules to serve as guidelines for employee conduct, rights, responsibilities and ethical standards.

Delegation of authority

Authorization guidelines and limitations: Aimed at streamlining business processes, strengthening distribution of responsibility, and detailing management authority at each job level.
Empowerment and delegation rules: Designed to ensure smooth and normal business operations.

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Job ranking, title and organizational structure policy: Formulated to correspond to employees’ career plans.

Work rules

The Company’s work rules clearly define the rights and obligations of management and employees. Its modern management approach has promoted cooperation among employees and benefited the Company.

Divisional responsibilities

The Company’s major divisions are separated by functions. Each division is tasked with specific job responsibilities and this separation of functions has strengthened the Company’s core competency.

Reward and punishment policies

The Company has drawn up a number of policies on rewards and punishments to encourage employees who have made special contributions to the Company, as well as discourage employees from behaving in a manner deemed damaging to the Company. These policies are stated in the Company’s “Work Rules.”

Employee assessment policy

Supervisors provide feedback, assistance and map out individual development plans based on employees’ performance.

Attendance and leave policy

Enforcement of this policy – designed to serve as a guideline for employees – helps enhance work quality.

Business confidentiality policy

To maintain the Company’s competitiveness, employees are required to sign a “Confidentiality and Intellectual Property Rights Statement” and an “Employment Contract” as safeguards against potential damage arising from the disclosure of trade secrets. The Company provides employees with the required information and training courses to strengthen their understanding of information security.

Sexual harassment prevention and handling procedures

The Company’s “Work Rules” include regulations on preventing sexual harassment in the workplace and promoting gender equality. The Company disseminates information on laws and procedures for filing complaints on sexual harassment on the intranet to serve as a guideline for employees.

Code of Conduct

The Company and its affiliates have a Code of Conduct that all directors, managers and employees are expected to adhere to and advocate in accordance with the highest ethical standards.

Employee benefits program

All employees are entitled to labor insurance, national health insurance and free group insurance coverage for employees and their spouses starting from the first day of work.
The Company has an employee share ownership trust (ESOT).
The Company and its subsidiaries had established Employee Welfare Committees to handle and implement employee benefits

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programs. The committees are in charge of a number of benefits designed to raise employees’ quality of life and promote physical and mental well-being, including club activities, company outings, family day, benefits for special occasions, such as weddings, festivals and funerals, employee purchase discount, and subsidies for fitness centers, group insurance and health examinations.

The Company grants high subsidies for phone bills, discounts on company products, and childbirth and childcare subsidies. It also provides maternity leave, sick leave and bereavement leave that surpass the requirements of Taiwan’s labor law. Moreover, it supports paid volunteer leave, flexible working hours and work-from-home as an option.

Employee training and education program

Training expenses up to January 31, 2023 totaled NT$33,966,678, with 666,645 attendees taking a total of 550,842 training hours.
Orientation for new employees includes company profile, brand and organization, telecommunications market, innovative services, internal network systems, employee health and safety, IT security training and avenues for learning.
Core competency development: Develop basic competencies, such as self-management and work management, problem analysis and solution skills, creative thinking, communication and interaction skills, project management, knowledge of industry trends and code of ethics; hold service training programs; organize book clubs; invite celebrity speakers; and screen humanist films.
Management training and development: Separate training programs for entry-level, middle and senior management. Training courses include performance management, leadership, strategy management, innovative thinking, team dynamics, organizational development skills and corporate governance.
The Company arranges for employees to participate in different programs according to their professional knowledge and skills, including information technology, auditing, human resources, marketing, procurement, safety, finance, accounting and telecommunications technology. These activities have a profound impact on upgrading the Company’s technologies, developing new products, introducing new and innovative ideas, and improving managerial skills.
The Company has a scholarship program for employees to develop their expertise in telecommunications technology, digital technology and business administration.
The Company sponsors external training courses for all employees annually. Employees can select courses that combine their personal interests and job needs to reap the maximum benefit from these training sessions.

Retirement plan and implementation

Old Labor Pension System

The Company has published its Employee Retirement Guidelines and formed a Labor Pension Supervisory Committee in accordance with the law. In addition, the Company retains the services of an actuary to assess and calculate labor pension reserves and provide a detailed report annually. It contributes a sum equivalent to 2% of a worker's monthly wage into a special labor pension account as a reserve fund to pay retirees.

As of January 2023, the accumulated reserve fund was NT$703,894,000.

New Labor Pension System

The Company implemented the New Labor Pension System in July 2005. It deposits 6% of a worker's monthly wage into an individual labor pension account managed by the Bureau of Labor Insurance, with ownership going to the worker. A total of NT$164,292,000 was deposited in 2022.

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Retirement policy

The Company regulates its retirement policy in accordance with labor laws. It also offers the option of early retirement for employees who have worked for at least five years with the Company, which plus his/her age would equal 65 years or above, subject to the Chairman’s approval.

Employee safety and health policy

The Company endeavors to contain potential hazards in the workplace, as well as build and promote a safety culture, by observing the following:

Regulatory compliance: Follow all rules and regulations pertaining to occupational safety and health as well as international standards, and conduct periodic reviews of compliance.
Risk control: Implement measures to identify safety risks at work to remove hazards and reduce occupational safety risk.
Consultation and communication: Enhance employee knowledge of the importance of health and safety, invite employees or representatives to participate in consultation and communication, and encourage them to participate in and take responsibility for their personal health and safety.
Environment-friendly: Provide safe and healthy working conditions, prevent occupational injuries and safeguard health.
Performance evaluation: Conduct systematic evaluations of these measures to gauge their effectiveness and improve occupational safety and health standards.
Action plans and targets: Prioritize the aspects to focus on and action plans, set quantitative goals and regularly track indicators.

The Company’s employee safety and health policy is posted on the intranet and is summarized as follows:

As an ISO 45001: 2018 (Occupational Safety and Health Management Systems) certified company, TWM strives to constantly improve health and safety management in order to reduce risks in the workplace.
A unit dedicated to conducting environmental inspections and employee hygiene training courses was established in accordance with regulations.
An Occupational Safety and Health Committee was set up to meet every three months to draft a plan to prevent job injuries, ensure compliance and conduct periodic reviews of related rules on employee health and sanitary improvement solutions.
Full-time professional nursing healthcare personnel are employed to perform health checks, track the progress of staff who failed their health examinations, and hold talks on health promotion. Employees who are able to administer first aid treatment have been placed in each work area.
Each office site is equipped with an automated external defibrillator and staffed with a sufficient number of first-aid personnel.
Fire/flood protection exercises are held every six months to reduce risks of employee injury and property loss from natural disasters.
Guards and security systems have been installed at all main base stations and work offices to protect staff, property and information security.

Employee negotiations and protection of employee benefits

The Company, working under the management and employees as one concept and the belief that a win-win situation can be achieved when the two sides work together, has followed relevant labor laws and regulations, held quarterly employee communication forums hosted by the President and management/employee meetings to facilitate communication, develop comprehensive communication channels between management and employees, and promoted employee benefits to build a harmonious and satisfactory management/employee relationship.

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Losses caused by employee disputes in 2022 up to the publication date in 2023:

The Company maintains a harmonious management/employee relationship and there were no material disputes.

Number of workplace injuries resulting in disabilities or fatalities in 2022 up to the publication date in 2023:

In 2022, there were three cases of workplace injuries [1] , two caused by exposure to hazardous substances and one caused by falling. To prevent recurrences, the Company has promoted health and safety measures, improved the safety awareness of employees, and revised rules and regulations to enhance workplace safety.

Year	2022	2023 (as of February 25)
Number of disabilities	3	0
Disabling injury frequency rate2	0.39	0
Disabling injury severity rate3	2.98	0

Note 1: Based on the Ministry of Labor’s definition of occupational accidents resulting in major disabling injuries, traffic accidents outside the workplace are not included.

Note 2: The number of injuries resulting in fatalities and permanent total disabilities cases per million hours worked.

Note 3: The number of working days lost due to fatalities and permanent total disabilities per million hours worked.

ICT security risk management

ICT security risk management framework, ICT security policy, specific management plan and resources invested in ICT security management

1. ICT security risk management framework

Based on the current risk management structure and operation mechanism, TWM’s board of directors serves as the highest decision-making mechanism and has incorporated information security risks into the Company’s overall personal information

and information security management policies. The general manager, as the Chief Information Security Officer (CISO), leads the first-level control mechanism. TWM has set up the ICT and Personal Information Security Management Division, which is responsible for supervising and reviewing information security implementation, supervision and management. TWM has also installed a second-level control mechanism – the Cyber Security and Data Privacy Protection Committee – which is responsible

for supervising and reviewing all matters concerning the implementation of a personal information and information security management system.

2. Company information security organizational structure

Taiwan Mobile has set up a Cyber Security and Data Privacy Protection Committee. The committee chairman is appointed by the president, and the top executive of each functional organization assigns a member to the committee. The committee meets quarterly and invites the independent director for observation. When issues relating to ICT are proposed by members of the Cyber Security and Data Privacy Protection Committee and the Information Security Officer, a meeting will be held with the approval of the chairperson. In compliance with the law, Taiwan Mobile has deployed a supervisor and more than 10 dedicated cybersecurity personnel on a full-time basis to execute all matters concerning the implementation of the personal information and information security management system.

108

3. ICT security policy

The ICT security policy has been established to ensure the sustainable operation of TWM's business, strengthen the ICT security management system, ensure the confidentiality, integrity and availability of information communication assets, and meet the requirements of relevant laws and regulations to effectively and reasonably reduce enterprise operational risk.

4. Specific management plan

The following four management schemes have been adopted to ensure security maintenance of information communication:

(1) External anti-hacking: Build intrusion prevention, network segmentation, firewall, web application firewall, etc. Conduct cyber security information sharing with Communication – Information Sharing and Analysis Center (C-ISAC) and other agency.
(2) Internal leakage prevention: Handle data leakage protection detection and gap reinforcement.
(3) System planning and construction: Include system development security specifications, perform code scanning, etc.
(4) Maintenance and operation monitoring: Build an information security monitoring center, check and analyze system records, and report and track abnormal conditions in real time.

Cyber insurance investment: Allocate a certain portion of the budget to ICT security management to reduce risks.

In the most recent year up to the date of publication of the annual report, if the loss, possible impact and countermeasures of a major information security incident cannot be reasonably estimated, the fact that it cannot be reasonably estimated shall be explained.

In the most recent year up to the publication data of the annual report, there was no major information security incident, so there was no resultant loss or impact. TWM continues to promote information security operations as a preventive measure.

Major Contracts

				As of February25,2023
Nature	Counterpart	Contract period	Description	Restriction clauses
Long-term credit facility	Sumitomo Mitsui Banking Corp. Taipei Branch	2022.01.31~2024.01.31	Long-term loan of NT$4 billion	Non-disclosure
	Mizuho Bank, Ltd., Taipei Branch	2022.04.14~2024.04.14	Long-term loan of NT$7 billion	Non-disclosure
	China Bills Finance Corp.	2022.11.28~2024.11.27	Long-term loan of NT$3 billion	Non-disclosure
	China Bills Finance Corp.	2022.06.02~2025.06.01	Long-term loan of NT$1.5 billion	Non-disclosure
	Mega Bills Finance Co., Ltd.	2020.12.25~2023.12.25	Long-term loan of NT$1.5 billion	Non-disclosure
	Yuanta Commercial Bank Co., Ltd.	2020.12.31~2023.12.31	Long-term loan of NT$2 billion	Non-disclosure
Strategic alliance	Bridge Alliance	2004.11.03~present	Joined Bridge Alliance	Non-disclosure
Procurement	Apple Asia LLC	2022.06.01~2025.05.31	Procurement agreement for iPhone	Non-disclosure

109

Nature	Counterpart	Contract period	Description	Restriction clauses
		2020.11.01~2023.10.31	Procurement agreement for iPad
	Samsung Electronics Taiwan Co., Ltd.	2014.11.01~present	Sales and supply agreement	Non-disclosure
	Google Asia Pacific Pte. Ltd.	2019.09.20~present	Sales and supply agreement	Non-disclosure
	Nokia Solutions and Networks Taiwan Co., Ltd.	2020.06.15~2023.05.31	Master supply agreement	Non-disclosure
Merger	Taiwan Star Telecom Co., Ltd.	2021.12.30~ present	100% acquisition of Taiwan Star shares	Non-disclosure
	Taiwan Star Telecom Co., Ltd.	2023.03.15	Amendment of merger agreement
		Affiliates
Nature	Counterpart	Contract period	Description	Restriction clauses
Procurement	Cheng Loong Corp.	2022.05.01~2023.06.30	Procurement agreement for cartons	Non-disclosure
	Shuenn Chyang Paper Container Co., Ltd.	2022.05.01~2023.06.30	Procurement agreement for cartons	Non-disclosure
Contract agreement	Li Jin Engineering Co., Ltd.	2021.05.05	Construction of southern logistics center	Non-disclosure
Program broadcasting agreement	Homeplus Digital Co., Ltd.	2021.01.01~2023.12.31	Consign and authorize advertisements of TV shopping for public broadcast to cable TV viewers	Non-disclosure
Lease agreement	Fubon Life Insurance Co., Ltd.	2018.08.01~2023.07.31	momo office building	Non-disclosure
	Zong Sine Industries Inc.	2021.06.08~2033.05.31	Lease contract for warehouse	Non-disclosure
	Yongyou Development Ltd.	2022.1.28~2032.07.31	Lease contract for warehouse	Non-disclosure

110

Chapter 5 Financial Highlights

Condensed Balance Sheets and Statements of Comprehensive Income

Consolidated condensed balance sheet (2018-2022)

Unit: NT$’000

						Unit: NT$’00
		2018	2019	2020	2021	2022
Current assets		29,068,887	29,905,700	32,092,794	38,652,038	41,439,100
Investments		6,199,506	6,723,913	4,256,640	5,856,891	7,761,891
Property, plant and equipment (PP&E)		38,855,960	36,182,005	42,479,314	43,439,740	44,247,993
Intangible assets		62,175,645	59,078,475	85,766,511	81,327,563	76,871,365
Other assets		11,367,030	22,029,866	19,989,343	21,706,295	22,751,317
Total assets		147,667,028	153,919,959	184,584,602	190,982,527	193,071,666
Current liabilities	Before appropriation	41,883,503	44,522,956	58,532,319	59,486,772	69,568,116
	After appropriation	57,249,726	57,873,424	70,631,100	71,614,845	(Note1)
Non-current liabilities		37,789,829	35,220,728	54,062,071	58,218,757	50,652,770
Total liabilities	Before appropriation	79,673,332	79,743,684	112,594,390	117,705,529	120,220,886
	After appropriation	95,039,555	93,094,152	124,693,171	129,833,602	(Note1)
Equity attributable to owne	rs of the parent company	61,881,520	68,017,291	65,365,100	65,533,753	64,470,756
Paid-in capital		34,238,338	35,093,545	35,124,215	35,192,336	35,192,336
Capital surplus	Before appropriation	12,580,692	20,274,694	18,936,574	16,903,239	15,326,778
	After appropriation	12,580,692	18,681,070	16,358,971	15,327,153	(Note1)
Retained earnings	Before appropriation	44,875,215	41,927,491	43,471,394	44,978,937	43,380,772
	After appropriation	29,508,992	30,170,647	33,950,216	34,426,950	(Note1)
Other equity interests		(95,381)	438,905	(2,449,739)	(1,823,415)	288,214
Treasury stock		(29,717,344)	(29,717,344)	(29,717,344)	(29,717,344)	(29,717,344)
Non-controlling interest		6,112,176	6,158,984	6,625,112	7,743,245	8,380,024
Total equity	Before appropriation	67,993,696	74,176,275	71,990,212	73,276,998	72,850,780
	After appropriation	52,627,473	60,825,807	59,891,431	61,148,925	(Note1)

Note 1: The appropriation amount for 2022 still has to be approved at the AGM. Note 2: All financial data have been duly audited by independent auditors.

111

Stand-alone condensed balance sheet (2018-2022)

Unit: NT$’000

						Unit: NT$’000
		2018	2019	2020	2021	2022
Current assets		17,738,839	16,835,738	16,039,175	16,800,099	19,397,247
Investments		43,791,521	45,171,026	47,242,230	47,874,612	51,164,875
Property,plant and equipment (PP&E)		22,249,874	19,711,168	25,327,616	25,967,927	24,806,240
Intangible assets		41,053,072	38,300,915	65,347,011	61,234,729	57,114,882
Other assets		10,229,894	19,087,499	16,914,811	18,105,193	19,092,221
Total assets		135,063,200	139,106,346	170,870,843	169,982,560	171,575,465
Current liabilities	Before appropriation	40,842,446	42,009,716	57,436,944	52,284,013	62,137,094
	After appropriation	56,208,669	55,360,184	69,535,725	64,412,086	(Note1)
Non-current liabilities		32,339,234	29,079,339	48,068,799	52,164,794	44,967,615
Total liabilities	Before appropriation	73,181,680	71,089,055	105,505,743	104,448,807	107,104,709
	After appropriation	88,547,903	84,439,523	117,604,524	116,576,880	(Note1)
Paid-in capital		34,238,338	35,093,545	35,124,215	35,192,336	35,192,336
Capital surplus	Before appropriation	12,580,692	20,274,694	18,936,574	16,903,239	15,326,778
	After appropriation	12,580,692	18,681,070	16,358,971	15,327,153	(Note1)
Retained earnings	Before appropriation	44,875,215	41,927,491	43,471,394	44,978,937	43,380,772
	After appropriation	29,508,992	30,170,647	33,950,216	34,426,950	(Note1)
Other equity interests		(95,381)	438,905	(2,449,739)	(1,823,415)	288,214
Treasury stock		(29,717,344)	(29,717,344)	(29,717,344)	(29,717,344)	(29,717,344)
Total equity	Before appropriation	61,881,520	68,017,291	65,365,100	65,533,753	64,470,756
	After appropriation	46,515,297	54,666,823	53,266,319	53,405,680	(Note1)

Note 1: The appropriation amount for 2022 still has to be approved at the AGM. Note 2: All financial data have been duly audited by independent auditors.

Consolidated statements of comprehensive income (2018-2022)

Unit: NT$’000

					Unit: NT$’000
	2018	2019	2020	2021	2022
Operating revenue	118,732,328	124,420,913	132,860,984	156,109,533	172,206,112
Gross profit	34,416,594	32,808,735	31,445,736	31,374,597	33,225,222
Operating income	18,162,042	17,193,335	16,056,160	16,053,041	16,892,739
Non-operating income (expenses)	(472,825)	(611,525)	(598,369)	(471,466)	(701,497)
Pre-tax income	17,689,217	16,581,810	15,457,791	15,581,575	16,191,242
Net income	14,485,768	13,291,867	12,393,778	12,825,209	12,971,412
Other comprehensive income (after tax)	98,554	487,173	(853,669)	667,222	42,699
Comprehensive income	14,584,322	13,779,040	11,540,109	13,492,431	13,014,111
Profit attributable to owners of the parent company	13,642,172	12,481,167	11,286,553	10,988,165	11,025,551
Profit attributable to non-controlling interest	843,596	810,700	1,107,225	1,837,044	1,945,861
Comprehensive income attributable to owners of parent company	13,768,068	12,971,397	10,414,104	11,662,701	11,068,344
Comprehensive income attributable to non- controllinginterest	816,254	807,643	1,126,005	1,829,730	1,945,767
EPS (NT$)	5.01	4.51	4.01	3.90	3.91

Note: All financial data have been duly audited by independent auditors.

112

Stand-alone statements of comprehensive income (2018-2022)

Unit: NT$’000

					Unit: NT$’000
	2018	2019	2020	2021	2022
Operatingrevenue	65,545,627	62,426,270	56,890,204	59,844,804	61,027,806
Netgrossprofit	22,528,422	20,285,294	17,661,456	15,047,344	14,796,158
Operatingincome	10,465,707	9,198,843	7,598,398	5,820,790	5,636,740
Non-operatingincome(expenses)	5,071,356	4,963,642	5,043,606	5,849,627	6,296,129
Pre-tax income	15,537,063	14,162,485	12,642,004	11,670,417	11,932,869
Net income	13,642,172	12,481,167	11,286,553	10,988,165	11,025,551
Other comprehensive income(after tax)	125,896	490,230	(872,449)	674,536	42,793
Comprehensive income	13,768,068	12,971,397	10,414,104	11,662,701	11,068,344
EPS(NT$)	5.01	4.51	4.01	3.90	3.91

Note: All financial data have been duly audited by independent auditors.

Independent auditors’ names and their audit opinions for the past five years

Year	Accounting firm	Name of CPA	Opinion
2018	Deloitte & Touche	Li-Wen Kuo, Kwan-Chung Lai	Unqualified opinion
2019	Deloitte & Touche	Li-Wen Kuo, Kwan-Chung Lai	Unqualified opinion
2020	Deloitte & Touche	Pei-De Chen, Kwan-Chung Lai	Unqualified opinion
2021	Deloitte & Touche	Pei-De Chen, Te-Chen Cheng	Unqualified opinion
2022	Deloitte & Touche	Pei-De Chen, Te-Chen Cheng	Unqualified opinion

113

Financial Analysis

Consolidated financial analysis (2018-2022)

		2018	2019	2020	2021	2022
Financial structure	Liabilities to assets ratio(%)	53.95	51.81	61.00	61.63	62.27
	Long-term fund to PP&E ratio(%)	256.51	285.33	281.14	284.88	260.18
Solvency	Current ratio(%)	69.40	67.17	54.83	64.98	59.57
	Quick ratio(%)	58.59	53.39	43.86	53.26	47.10
	Interest coverage ratio(%)	3,039.18	2,984.90	2,598.88	2,581.88	2,296.51
Operations	Accounts receivable turnover (x)	14.08	14.81	15.66	18.61	19.90
	Average collection days	25.92	24.64	23.30	19.61	18.34
	Inventoryturnover(x)	12.70	12.92	12.70	15.27	14.58
	Accountspayable turnover(x)	11.20	12.44	11.54	11.47	10.72
	Average days sales	28.74	28.25	28.74	23.90	25.03
	Property, plant and equipment turnover (x)	2.95	3.32	3.38	3.63	3.93
	Total asset turnover(x)	0.77	0.80	0.78	0.83	0.90
Profitability	Return on assets(%)	9.77	8.83	7.62	7.10	7.06
	Return on equity attributable to owners of the parent company (%)	21.84	19.21	16.92	16.79	16.96
	Pre-tax income as a % of paid-in capital	51.66	47.25	44.01	44.28	46.01
	Net income margin(%)	12.20	10.68	9.33	8.22	7.53
	EPS(NT$)	5.01	4.51	4.01	3.90	3.91
Cash flow	Cash flow ratio(%)	71.09	67.87	54.23	50.76	42.51
	Cash flow adequacyratio(%)	107.37	112.96	121.06	121.26	121.02
	Cash reinvestment rate(%)	7.45	7.58	8.09	7.75	7.13
Leverage	Operatingleverage	2.88	2.93	3.01	3.16	3.10
	Financial leverage	1.03	1.03	1.04	1.04	1.05

114

Stand-alone financial analysis (2018-2022)

		2018	2019	2020	2021	2022
Financial structure	Liabilities to assets ratio(%)	54.18	51.10	61.75	61.45	62.42
	Long-term fund to PP&E ratio(%)	423.47	492.60	447.87	453.25	441.17
Solvency	Current ratio(%)	43.43	40.08	27.92	32.13	31.22
	Quick ratio(%)	37.24	31.97	23.17	26.50	24.94
	Interest coverage ratio(%)	2,700.99	2,603.12	2,145.09	1,903.84	1,679.98
Operations	Accounts receivable turnover (x)	9.33	9.32	8.53	9.17	9.09
	Average collection days	39.12	39.16	42.79	39.80	40.15
	Inventoryturnover(x)	6.23	6.87	6.09	8.02	6.48
	Accountspayable turnover(x)	17.67	27.34	20.79	21.20	21.01
	Average days sales	58.58	53.12	59.93	45.51	56.32
	Property, plant and equipment turnover (x)	2.82	2.98	2.53	2.33	2.40
	Total asset turnover(x)	0.47	0.44	0.37	0.35	0.36
Profitability	Return on assets(%)	10.08	9.14	7.60	6.75	6.81
	Return on equity (%)	21.84	19.21	16.92	16.79	16.96
	Pre-tax income as a % of paid-in capital	45.38	40.36	35.99	33.16	33.91
	Netprofit margin(%)	20.81	19.99	19.84	18.36	18.07
	EPS(NT$)	5.01	4.51	4.01	3.90	3.91
Cash flow	Cash flow ratio(%)	48.50	48.38	35.97	31.47	25.38
	Cash flow adequacyratio(%)	83.91	89.37	97.27	93.56	90.17
	Cash reinvestment rate(%)	2.68	2.93	3.57	2.11	1.75
Leverage	Operatingleverage	3.69	3.92	4.46	5.77	6.09
	Financial leverage	1.06	1.07	1.09	1.13	1.15

Explanation of significant changes in 2022 compared with the previous year:

Inventory turnover decreased and average days sales increased in 2022 compared with 2021 due to an increase in the ending balance of inventory.

115

Note 1: The financial data for 2018-2022 have been duly audited by independent auditors. Note 2: Formulas for the above tables:

Financial structure (1) Debt to asset ratio = Total liabilities / Total assets (2) Long-term fund to PP&E ratio = (Shareholders’ equity + Long-term liabilities) / Net PP&E Solvency (1) Current ratio = Current assets / Current liabilities (2) Quick ratio = (Current assets – Inventory – Prepaid expenses) / Current liabilities (3) Interest coverage ratio = Income before interest and taxes / Interest expense Operations (1) Accounts receivable turnover = Net revenue / Average accounts receivable (2) Average collection days = 365 / AR turnover (3) Inventory turnover = COGS / Average inventory (4) Accounts payable turnover = COGS / Average accounts payable (5) Average days sales = 365 / Inventory turnover (6) PP&E turnover = Net revenue / Average net PP&E (7) Total asset turnover = Net revenue / Average total assets Profitability (1) Return on assets = [Net income + Interest expense x (1 – Tax rate)] / Average assets (2) Return on equity = Net income / Average equity (3) Net income margin = Net income / Net sales (4) EPS = (Net income – Preferred stock dividends) / Weighted average outstanding shares Cash flow (1) Cash flow ratio = Cash flow from operating activities / Current liabilities (2) Cash flow adequacy ratio = Net cash flow from operating activities for the past 5 years / (Capital expenditure + Increases in inventory + Cash dividends for the past 5 years) (3) Cash reinvestment rate = (Cash flow from operating activities – Cash dividends) / (Gross PP&E + Long-term investments + Other assets + Working capital) (Note: Use zero if working capital value is negative) Leverage (1) Operating leverage = (Net revenue – Variable operating costs and expenses) / Operating income (2) Financial leverage = Operating income / (Operating income – Interest expense)

116

Audit Committee Report

February 24, 2023

The Board of Directors of Taiwan Mobile Co., Ltd. (TWM) has submitted the Company’s 2022 business report and financial statements to the Audit Committee. The CPA firm, Deloitte & Touche, was retained by the Board to audit TWM’s financial statements and has issued an audit report relating to the financial statements. The business report and financial statements have been reviewed and determined to be correct and accurate by the Audit Committee of TWM. According to Article 14-4 of the Securities and Exchange Act and Article 219 of the Company Act, we hereby submit this report.

Taiwan Mobile Co., Ltd.

Hsueh-Jen Sung

Chairman of the Audit Committee

117

2022 Consolidated Financial Statements:

Refer to the attachment.

2022 Stand-alone Financial Statements:

Refer to the attachment.

Financial Difficulties for the Company and its Affiliates:

None

118

Chapter 6 Review and Analysis of Financial Conditions, Operating Results and Risk Management

Balance Sheet Analysis

Consolidated balance sheet analysis

Explanation of significant changes (at least a 20% change) in the past two years’ assets, liabilities and equity:

Investments rose mainly due to increased cross-industry strategic investments.

2021 - 2022 Consolidated Balance Sheet

Unit: NT$’000, %

			Unit: NT$’000, %	Unit: NT$’000, %
	2021	2022	YoY change
			Amount	%
Current assets	38,652,038	41,439,100	2,787,062	7.21
Investments	5,856,891	7,761,891	1,905,000	32.53
Property, plant and equipment	43,439,740	44,247,993	808,253	1.86
Intangible assets	81,327,563	76,871,365	(4,456,198)	(5.48)
Other assets	21,706,295	22,751,317	1,045,022	4.81
Total assets	190,982,527	193,071,666	2,089,139	1.09
Current liabilities	59,486,772	69,568,116	10,081,344	16.95
Non-current liabilities	58,218,757	50,652,770	(7,565,987)	(13.00)
Total liabilities	117,705,529	120,220,886	2,515,357	2.14
Paid-in capital	35,192,336	35,192,336	-	-
Capital surplus	16,903,239	15,326,778	(1,576,461)	(9.33)
Retained earnings	44,978,937	43,380,772	(1,598,165)	(3.55)
Other equity and treasury stock	(31,540,759)	(29,429,130)	2,111,629	(6.69)
Non-controlling interests	7,743,245	8,380,024	636,779	8.22
Total equity	73,276,998	72,850,780	(426,218)	(0.58)

119

Stand-alone balance sheet analysis

Explanation of significant changes (at least a 20% change) in the past two years’ assets, liabilities, and equity:

No significant changes.

2021- 2022 Stand-alone Balance Sheet

Unit: NT$’000, %

			Unit: NT$’000, %	Unit: NT$’000, %
	2021	2022	YoY change
			Amount	%
Current assets	16,800,099	19,397,247	2,597,148	15.46
Investments	47,874,612	51,164,875	3,290,263	6.87
Property, plant and equipment	25,967,927	24,806,240	(1,161,687)	(4.47)
Intangible assets	61,234,729	57,114,882	(4,119,847)	(6.73)
Other assets	18,105,193	19,092,221	987,028	5.45
Total assets	169,982,560	171,575,465	1,592,905	0.94
Current liabilities	52,284,013	62,137,094	9,853,081	18.85
Non-current liabilities	52,164,794	44,967,615	(7,197,179)	(13.80)
Total liabilities	104,448,807	107,104,709	2,655,902	2.54
Paid-in capital	35,192,336	35,192,336	-	-
Capital surplus	16,903,239	15,326,778	(1,576,461)	(9.33)
Retained earnings	44,978,937	43,380,772	(1,598,165)	(3.55)
Other equity and treasury stock	(31,540,759)	(29,429,130)	2,111,629	(6.69)
Total equity	65,533,753	64,470,756	(1,062,997)	(1.62)

Impact of changes in financial conditions on financial results: No significant impact.

Preventive measures: Not applicable.

120

Statements of Comprehensive Income Analysis

Consolidated statements of comprehensive income

Explanation of significant changes in the past two years’ operating revenue, operating income and income before tax:

Increase in non-operating expenses: Mainly due to increased losses from disposal of property, plant and equipment.

2021 - 2022 Consolidated Statements of Comprehensive Income

Unit: NT$’000, %

			Unit: NT$’000, %	Unit: NT$’000, %
	2021	2022	YoY change
			Amount	%
Operating revenue	156,109,533	172,206,112	16,096,579	10.31
Operating costs	124,734,936	138,980,890	14,245,954	11.42
Gross profit	31,374,597	33,225,222	1,850,625	5.90
Operating expenses	16,005,557	17,143,477	1,137,920	7.11
Operating income	16,053,041	16,892,739	839,698	5.23
Non-operating income (expenses)	(471,466)	(701,497)	(230,031)	48.79
Income before tax	15,581,575	16,191,242	609,667	3.91
Net income	12,825,209	12,971,412	146,203	1.14

Stand-alone statements of comprehensive income

Explanation of significant changes in the past two years’ operating revenue, operating income and income before tax:

No significant changes.

2021 - 2022 Stand-alone Statements of Comprehensive Income

Unit: NT$’000, %

			Unit: NT$’000, %	Unit: NT$’000, %
	2021	2022	YoY change
			Amount	%
Operating revenue	59,844,804	61,027,806	1,183,002	1.98
Operating costs	44,797,460	46,231,648	1,434,188	3.20
Net gross profit	15,047,344	14,796,158	(251,186)	(1.67)
Operating expenses	9,812,496	9,771,507	(40,989)	(0.42)
Operating income	5,820,790	5,636,740	(184,050)	(3.16)
Non-operating income (expenses)	5,849,627	6,296,129	446,502	7.63
Income before tax	11,670,417	11,932,869	262,452	2.25
Net income	10,988,165	11,025,551	37,386	0.34

121

Revenue outlook, key assumptions, potential impact on the Company’s business and corresponding proposal:

In terms of 5G unique bundle plans, the Company expects OP Life to drive customers to choose higher rate plans and enhance customer stickiness. Once the regulators approve the merger of Taiwan Mobile and Taiwan Star, the Company should benefit from better economies of scale, merger synergies, as well as increased revenue and EBITDA.

Cash Flow Analysis

Consolidated cash flow analysis

Increase in cash outflow from investment activities: Cash outflow rose mainly due to strategic investments and alliances for new growth avenues.

2021 - 2022 Consolidated Cash Flow Statement

			Unit: NT$’000, %	Unit: NT$’000, %
	2021	2022	YoY change
			Amount	%
Cash inflow (outflow) from operating activities	30,195,542	29,576,551	(618,991)	(2.05)
Cash inflow(outflow)from investment activities	(9,638,497)	(11,631,753)	(1,993,256)	20.68
Cash inflow(outflow)from financingactivities	(15,932,014)	(18,413,364)	(2,481,350)	15.57
Impact from changes in exchange rate	(797)	1,281	2,078	NM
Net cash increase(decrease)	4,624,234	(467,285)	(5,091,519)	NM

Stand-alone cash flow analysis:

Increase in cash outflow from investment activities: Cash outflow rose mainly due to subsidiaries’ capital increase.

2021 - 2022 Stand-alone Cash Flow Statement

			Unit: NT$’000, %	Unit: NT$’000, %
	2021	2022	YoY change
			Amount	%
Cash inflow (outflow) from operating activities	16,451,660	15,771,527	(680,133)	(4.13)
Cash inflow(outflow)from investment activities	783,540	(978,543)	(1,762,083)	NM
Cash inflow(outflow)from financingactivities	(17,151,183)	(14,241,722)	2,909,461	(16.96)
Net cash increase(decrease)	84,017	551,262	467,245	556.13

Plans to improve negative liquidity: Not applicable.

Projected consolidated cash flow for 2023

Projected cash inflow from operating activities: Expected to remain relatively stable.
Projected cash outflow from investment activities: For capital expenditure.
Projected cash outflow from financing activities: For cash dividend distribution.

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2023 Consolidated Projected Cash Flow

				Unit: NT$’000	Unit: NT$’000
Cash balance, beginning of the year (1)	Forecast net cash inflow from operations (2)	Forecast cash outflow from investment and financing activities (3)	Cash balance, end of the year (1) + (2) - (3)	Source of funding for negative cash balance
				Cash inflow from investment activities	Cash inflow from financing activities
14,934,740	30,419,001	29,875,053	15,478,688	`－`	`－`

Source of Funding for Negative Cash Flow in 2023: Not applicable.

Analysis of Major Capex and its Impact on Finance and Operations

The Company funds its major capex with internally generated cash flows.

Investment Policies, Reasons for Profit/Loss, Plans for Improvement, and Future Investment Plan

Taiwan Mobile focuses on making long-term and strategic investments. The objective is to strengthen and diversify its core business and expand into new fields to create synergies.

In 2022, on a consolidated basis, TWM’s investment income from long-term investments under the equity method amounted to NT$10,145 thousand. For future investments, TWM will continue to make decisions based on prudent strategic assessments.

Risk Management

Impact of inflation, interest and exchange rate fluctuations, and preventive measures:

Impact of interest rate fluctuations
The Company has mid-term loan facilities with financial institutions and mid-to-long-term straight bond issuances on partial current outstanding liabilities to lock in mid-to-long-term interest rates and minimize risks from interest rate fluctuations. Overall, interest rate fluctuations had an insignificant impact on the Company.
Impact of exchange rate fluctuations
Only some of the Company’s payments are denominated in euros and US dollars. To minimize the impact from foreign exchange rate fluctuations, the Company hedges risks through foreign exchange spot market transactions. Overall, exchange rate fluctuations had an insignificant impact on the Company.
Impact of inflation

Inflation had a minor impact on the Company’s operating performance in 2022 up to the publication date in 2023.

Investment policy and reasons for gains & losses for high-risk/high-leverage

financial products, derivatives, loans to others and guarantees of debts:

The Company was not involved in any high-risk, high-leverage financial investment.
The Company passed the Rules and Procedures on Lending and Making Endorsement/Guarantees to supervise its financing and endorsement activities. As the counterparties in its loans and guarantees are all its subsidiaries, there is minimal operating risk.
Derivatives transaction: None.

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Future research and development plans

Project name	Objective

Anti-phishing solution	Use AI machine learning algorithms to identify phishing websites.

Storefront outbound call	Develop outbound call recording system to facilitate customer relationship management for
recording system	myfone stores.
Customer fraud/credit	Use big data and rule engine framework to detect abnormal behavior in customer usage or
control	transactions (ex. telco/non-telco services).
	Develop a system that checks a customer’s credit status when he/she wants to purchase an item
OP Pay Later: credit	that exceeds his/her credit limit. The system would check the customer’s credit status and adjust
check and promotion	his/her credit limit within manageable risks.
system	Assist marketing department in developing creative and interactive promotional events to attract
	more customers. The system would also support third-party product promotion and advertising.
	Develop a large-scale interactive videoconferencing system for enterprises to allow more users
M+
	to take part simultaneously in the group chat, vote and share a virtual whiteboard.

	Offer new streaming formats with home-cinema quality.
MyVideo
	Enhance encryption security for different devices.


MyMusic	Develop Podcast community service and participate in momo coin ecosystem.

	Provide comprehensive management interface and simplify integration steps and efforts to
Number masking service
	reduce barriers in enterprise application integration.

	Support the Matter IoT Standard to create a new cross-brand and more diversified smart home
Smarter Home
	AIoT ecosystem.

Intelligent product	Develop an intelligent system that links a hashtag to products in the same category to boost
	product recommendations.
hashtag

Forecast research and development expenses

The projected research and development expense for 2023 is NT$448.587 million.

Regulatory changes and developments

1. The Telecommunications Consumer Mediation Center `（` TCMC `）` was founded on July 1, 2022

(1) Status

Pursuant to the provisions of paragraph 1, article 20 of the Telecommunications Management Act, the NCC appointed seven telecommunications operators to jointly establish the TCMC to take charge of accepting and mediating consumer complaints. The NCC supervises the operation of the center and intervenes only when there are major consumer disputes or when it is urgent.

(2) Countermeasures

The Company works with the TCMC to protect the rights of consumers and handle consumer complaints properly.

2. The government plans to accept applications for 4.8-4.9GHz dedicated telecommunication network for mobile broadband in 2023

(1) Status

In line with the Executive Yuan’s policy to build a 5G dedicated spectrum and telecommunication network and provide innovative services, the government plans to accept applications for 4.8-4.9GHz dedicated telecommunication network for mobile broadband in 2023. The government is still working on the draft of the

124

Regulations Governing the Establishment and Use of Dedicated Telecommunications Networks to discuss whether to deregulate public telecommunications network access and infrastructure sharing of radio access network.

(2) Countermeasures

The Company continues constant communication with the government about the draft bill. While the government

releases such spectrum for application, the Company will make efforts to plan solutions for the 5G dedicated

spectrum and telecommunication network to meet market demand.

3. The Ministry of Digital Affairs (moda) was founded on August 27, 2022

(1) Status

With the establishment of the moda, it took over some of the tasks that were assigned to the NCC, including infrastructure and cybersecurity, telecommunications universal service, spectrum planning, number and website address management, telecommunications industry counsel and awards, and management of telecommunications industry related funds. The change allows the NCC to focus on its role as an independent regulator in charge of policy making and overseeing network communication and internet content classification.

(2) Countermeasures

The Company collaborates and continues effective communication with the government.

4. The moda accepts the bandwidth applications for fixed communications services of low Earth orbit (LEO) satellites

(1) Status

On November 7, 2022, the moda announced the "Matters Concerning Applications of Telecommunications Enterprises for the Assignment of Radio Frequency for Fixed-Satellite Service" for application of the spectrum for the fixed satellite communication. From November 8 to December 30, 2022, the moda accepted telecom operators’ applications for Ku/Ka frequency bands (10.7~12.7GHz, 13.75~14.5GHz, 17.7~20.2GHz, and 27.5~30.0GHz ） for geo-sync and non-geo-sync orbit. LEO satellites could be used as backhaul in outlying islands and remote areas in order for increasing coverage of these areas, as well as provide emergency backup to optimize telecommunication network resiliency.

(2) Countermeasures

The Company cooperates with the government and international satellite service providers to formulate testing and verification mechanisms.

5. The NCC approved Chunghwa Telecom’s plan to reduce wholesale IP peering price

(1) Status

Based on the applicable tariff adjustment coefficient of the fixed network telecommunications business announced by the NCC and the consumer price index published by the Directorate General of Budget, Accounting and Statistics (DGBAS), the NCC approved Chunghwa Telecom’s new wholesale pricing scheme, which lowered the private peering price of IP network interconnections by 16.39%, from NT$61 per Mbps to NT$51 per Mbps. This scheme took effect retroactively on April 1, 2022.

(2) Countermeasures

The Company continues to strengthen global network capability to provide diverse internet routing and stable broadband quality.

6. The NCC reduced the mobile-to-fixed termination rates on December 7, 2022

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(1) Status

To facilitate market competition, the NCC on December 7, 2022 announced that the mobile-to-fixed termination rate would be lowered from NT$0.4383 to NT$0.4349 per minute for peak hours, and from NT$0.2184 to NT$0.2059 per minute for off-peak hours. The new rates were implemented on January 1, 2023.

(2) Countermeasures

The Company evaluates market demand and optimizes 5G-related application services to improve user experience and facilitate the development of the telecommunications industry.

Technology changes and development

1. Mobile broadband access network

(1) Status

In 2022, TWM’s peers not only increased their bandwidth via spectrum acquisition and network sharing deals, but also continued their aggressive 5G network build-out. Meanwhile, Taiwan Mobile’s network expansion plan has been affected as the merger with Taiwan Star is still under review by regulators.

(2) Countermeasures

An analysis by Taiwan Mobile showed that users do not require extremely high data speed in most usage scenarios. TWM’s network investment strategy of prioritizing expansion in metropolitan areas and high usage hot spots proved to be effective in offering a competitive user experience. Its 5G N700 band offers superior propagation characteristics and was an effective tool in balancing competitors’ deployment advantage. After the merger of Taiwan Mobile and Taiwan Star is formally approved by regulators, the integration of spectrum and base station resources will be carried out as soon as possible to maximize synergies.

2. Mobile voice services

(1) Status

Since operators launched free VoLTE voice services in August 2022, VoLTE subscription has grown significantly. The National Communications Commission (NCC) has called on mobile service providers to phase out their 3G networks. Chunghwa Telecom and Far EasTone have agreed to terminate their 3G services by June 2024. Taiwan Mobile is also considering the same move. As such, VoLTE related capacity needs to be expanded.

(2) Countermeasures

To accommodate the growth of VoLTE users, TWM will continue to expand core voice network capacity, while redundant multi-site will be shut down to increase network reliability and resiliency. Shutting down TWM’s 3G

3. ICT security risks

(1) Risk changes in the development of mobile broadband technology

As mobile technology evolves and 5G develops, ICT security threats, risks and impacts have become more complex and significant. With 5G services expanding the scope of users and applications and increasing the importance of information carried on the network, there are risks of leakage or improper use of privacy and personal data, such as digital footprints. Meanwhile, 5G’s larger capacity to support more IoT devices also opens it to risks of devices being infected with a virus and attacking the 5G system. Challenges to the resilience of the 5G system will increase from a personal level to the wider issue of information security of an enterprise, society and the nation.

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In addition, as telecommunications services gradually move toward an open architecture, there is also the enhanced information security risk that software may generate.

(2) Countermeasures

In the face of these threats to information security, TWM has adopted a consistent all-round thinking, planning and deploying information security equipment, improving network strength, identifying possible types of threats, and taking corresponding protective and control measures through system implementation, standard operating procedures, personnel training and reinforcement. TWM has also maintained a prudent attitude toward new architecture, software and functions, and will not blindly pursue innovation and speed, but will carefully evaluate, verify and implement measures.

Impact of changes in brand image on the Company’s risk management policies in 2022 up to the publication date in 2023:

The Company has long built up a sound image among investors and customers for its continuing efforts to enhance corporate governance, network communication quality, customer service and corporate sustainability. These efforts won numerous recognitions and awards in 2022 (please refer to Chapter 1) and should aid the Company in preventing, controlling and managing latent risks that it might face and help it maintain its good corporate image.

Expected benefits and risks from mergers in 2022 up to the publication date in 2023:

Expected benefits from Taiwan Mobile and Taiwan Star merger:

Enlarge customer base and spectrum resources to achieve greater economies of scale.

Possible risks and response actions:
a. Merger is awaiting approval by the FTC and the TWSE.
b. The NCC has given its conditional approval for the merger. One of the conditions is that the Company return 10MHz sub 1GHz spectrum without any compensation by June 30, 2024. If the aforementioned spectrum is not returned by that date, TWM will have to sell the spectrum. These are completely dependent on the willingness of other spectrum holders, namely its competitors. The Board of Directors thinks these alternatives are unfair and impossible to execute.
c. The board has asked management to study the possibility of taking legal action.

Expected benefits and risks related to plant facility expansions in 2022 up to the publication date in 2022:

Not applicable as the Company is not a manufacturer.

Risks from supplier and buyer concentration in 2022 up to the publication date in 2023:

The Company has minimal risks from supplier and buyer concentration (please refer to Chapter 4).

Significant changes in shareholdings of directors and major shareholders in 2022 up to the publication date in 2023: None.

Changes in management controls in 2022 up to the publication date in 2023: None. Significant lawsuits and non-litigious matters in 2022 up to the publication date in 2023

1. The Company:

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(1) Spectrum dispute between Far EasTone Telecommunications Co., Ltd. (“FET”) and Taiwan Mobile (“the Company”)

Parties Involved: FET is the plaintiff and the Company is the defendant.

Grounds for Lawsuit:

FET filed a lawsuit demanding that the Company: (a) file an immediate application to return the spectrum block 1748.7-1754.9/1843.7-1849.9 MHz (hereinafter referred to as “C4 spectrum block”) to the National Communications Commission (“NCC”); (b) stop using the C4 spectrum block in any way; (c) stop using the spectrum block 1715.11721.3/1810.1-1816.3 MHz (hereinafter referred to as “C1 spectrum block”) until it has returned the C4 spectrum block to the NCC; and (d) pay FET NT$1,005,800,000.

Status:

In May 2016, the Taipei District Court (“District Court”) ruled that: (i) the Company received an unfavorable judgment on the claims stated in sections (a) to (c); (ii) FET received an unfavorable judgment on the claim stated in section (d). The Company and FET filed their respective appeals with the Taiwan High Court (“High Court”).

The High Court in January 2018 ruled as follows:

(1) The District Court judgment in connection with the following items was dismissed:
(i) the unfavorable judgment against the Company on the claims stated in sections (a) to (c), and the corresponding portion that FET claimed provisional execution; and
(ii) the unfavorable judgment against FET on the claim stated in section (d), the corresponding portion of provisional execution, and litigation expenses.
(2) For the dismissed portion stated in section 1(i), FET’s claim and the motion of provisional execution in the first instance were rejected.
(3) For the dismissed portion stated in section 1(ii), the Company shall pay FET NT$765,779,233, as well as a 5% annual interest rate on NT$152,583,658 of the aforementioned amount from September 5, 2015 until the payment date.

The Company appealed the High Court’s ruling to the Supreme Court. In May 2019, the Supreme Court overruled the High Court’s judgment in regard to (1) FET's other appeal, (2) the Company's payment obligation, and (3) litigation expenses with respect to the aforementioned two items, and remanded the case to the High Court.

The High Court in August 2020 ruled as follows:

(1) The District Court judgment in connection with the following items were dismissed: the claim stated in section 2 below, the corresponding portion of provisional execution that FET claimed, and litigation expenses (except the part on final and binding judgment).
(2) For the dismissed portion stated in the preceding section 1, TWM shall pay FET NT$242,153,783, as well as a 5% annual interest rate on NT$99,468,550 from July 21, 2017 until the payment date and a 5% annual interest rate on NT$142,685,233 from September 30, 2016 until the payment date.
(3) The rest of the appeal was rejected.
(4) FET shall bear 75 percent of the litigation expenses in the first and the second trials (except for the part on final and binding judgment), as well as the second and the third trials prior to the remand; TWM shall bear responsibility for the rest.
(5) Regarding the portion of TWM’s payment as ruled, FET may file a provisional execution with a collateral of NT$80,720,000; and TWM may provide a counter-security of NT$242,153,783 to be exempt from the above provisional execution by FET.

The Company appealed the High Court’s ruling to the Supreme Court. The lawsuit is pending in the Supreme Court.

2. The Company’s directors, general manager, executives, major shareholder holding more than 10 percent of the Company’s shares: None.

3. The Company’s subsidiaries: None.

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Other major risks and countermeasures

In terms of information security and privacy protection, the telecommunications industry has a huge trove of personal data. If they are accidentally leaked, the Company could be held legally responsible, which could seriously damage its reputation.

Countermeasures:

TWM has implemented the ISO/IEC 27001 – Information Security Management System (ISMS) and BS 10012, ISO/IEC 27701, 29100 – Personal Information Management System (PIMS). The Company’s Cyber Security and Data Privacy Protection Committee reviews security and personal information protection policies on a quarterly basis and reports the results of ISMS and PIMS to the board of directors. The Company has also purchased cybersecurity insurance for advanced customer data protection. Furthermore, to ensure a four-dimensional protection of users’ personal data and internal confidential data, the Company has implemented the following:

External anti-hackers: Build intrusion prevention, network segmentation, firewall, web application firewall, etc.
Internal leakage prevention: Handle data leakage protection detection and gap reinforcement measures.
System planning and development: Incorporate system development security specifications and execute code scanning, etc.
Operation and maintenance monitoring: Establish an information security monitoring center, check and analyze system records, and report and track if abnormal conditions are found.

Other significant items: None

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Chapter 7 Special Notes

Affiliates

1. Investment holding structure

As of December 31, 2022

==> picture [710 x 274] intentionally omitted <==

Note 1: 70.47% of shares are held under trustee accounts.

130

2. Affiliates’ profile

As of December 31, 2022; Unit: NT$ (unless otherwise stated)

Name	Date of incorporation	Address	Paid-in capital	Main business
Taiwan Cellular Co., Ltd.	2005.09.20	7F, No. 206, Dunhua S. Rd., Sec. 2,Da-an District.,Taipei	5,029,703,090	Investment
Wealth Media Technology Co., Ltd.	2007.08.07	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	420,650,000	Investment
TWM Venture Co., Ltd.	2019.09.20	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	4,330,510,350	Investment
Taipei New Horizon Co., Ltd.	2009.01.07	6F, No. 88, Yanchang Rd., Xinyi District, Taipei	3,845,000,000	Building and operating Songshan Cultural and Creative Park BOTproject
Fu Sheng Digital Co., Ltd.	2022.10.07	7F, No. 206, Dunhua S. Rd., Sec. 2,Da-an District.,Taipei	30,000,000	Information service
Taiwan Fixed Network Co., Ltd.	2007.01.30	4F, No. 111, Dunhua S. Rd., Sec. 1, Da-an District., Taipei	21,000,000,000	Fixed-line service provider
Taiwan Teleservices & Technologies Co., Ltd.	2001.06.08	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	24,843,000	Call center service and telemarketing
TWM Holding Co., Ltd.	2006.06.09	Arias, Fabrega & Fabrega Trust Co., BVI Ltd. 325 Waterfront Drive, Road Town, Tortola, British Virgin Islands	US$ 1	Investment
TCC Investment Co., Ltd.	2009.08.10	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	1,547,213,080	Investment
Taiwan Digital Service Co., Ltd.	2013.04.02	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	25,000,000	Commissioned maintenance service
Taihsin Property Insurance Agent Co., Ltd.	2017.12.29	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	5,000,000	Property insurance agent
Tai-Fu Cloud Technology Co., Ltd.	2018.01.11	4F, No. 111, Dunhua S. Rd., Sec. 1, Da-an District., Taipei	200,000,000	Cloud and information services
Taiwan Mobile Film Co., Ltd.	2021.04.28	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	11,300,000	Film production
TFN Media Co., Ltd.	2005.01.25	11F, No. 98, Zhouzi St., Neihu District, Taipei	2,309,213,040	Type II telecommunications business
Global Forest Media Technology Co., Ltd.	2008.12.26	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	15,000,000	Investment
Global Wealth Media Technology Co., Ltd.	2007.10.26	1F, No. 206, Datong Rd., Sec. 2, Xizhi District, New Taipei City	89,448,670	Investment
Win TV Broadcasting Co., Ltd.	2005.10.17	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	181,773,820	TV program provider
momo.com Inc.	2004.09.27	4F, No. 96, Zhouzi St., Neihu District, Taipei	2,184,912,600	Wholesale and retail sales
TFN Union Investment Co., Ltd.	2009.09.22	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	4,000,000	Investment
TWM Communications (Beijing) Ltd.	2002.09.17	Room 2106, No. 9, Beisihuan West Rd., Haidian District, Beijing, China	US$ 3,000,000	Data communication Application development
TCCI Investment and Development Co., Ltd.	2009.09.22	7F, No. 206, Dunhua S. Rd., Sec. 2, Da-an District., Taipei	1,047,120,000	Investment
Taiwan Stampede	2022.03.11	7F,No. 206,Dunhua S. Rd.,	300,000	Filmproduction

131

Name	Date of incorporation	Address	Paid-in capital	Main business
Franchise Film Co., Ltd.		Sec. 2, Da-an District., Taipei
Taiwan Kuro Times Co., Ltd.	2009.02.11	12F, No. 88, Yanchang Rd., Xinyi District, Taipei	147,000,000	Digital music service
Yeong Jia Leh Cable TV Co., Ltd.	1994.09.26	10F, No. 651-5, Zhongzheng Rd., Xinzhuang District, New Taipei City	339,400,000	Cable TV service provider
Mangrove Cable TV Co., Ltd.	1996.01.23	5F, No. 33, Lane 3, Zhongzheng E. Rd., Sec. 1, Danshui District, New Taipei City	211,600,000	Cable TV service provider
Phoenix Cable TV Co., Ltd.	1996.08.22	No. 312, Fongping 1st Rd., Daliao District,Kaohsiung	680,901,980	Cable TV service provider
Union Cable TV Co., Ltd.	2005.02.04	No.179, Nujhong Rd., Sec. 1, Yilan City, Yilan County	1,704,632,800	Cable TV service provider
Globalview Cable TV Co., Ltd.	1995.11.25	No. 206, Datong Rd., Sec. 2, Xizhi District, New Taipei City	560,000,000	Cable TV service provider
Asian Crown International Co., Ltd.	2009.01.07	Coastal Building, Wickham's Cay II, P.O. Box 2221, Road Town, Tortola, British Virgin Islands	US$ 11,873,735	Investment
Honest Development Co., Ltd.	2015.01.23	Maystar Chambers, P.O.Box 3269, Apia, Samoa	US$ 21,778,413	Investment
Fuli Life Insurance Agent Co., Ltd.	2005.12.27	7F, No. 98, Zhouzi St., Neihu District, Taipei	5,000,000	Life insurance agency
Fuli Property Insurance Agent Co., Ltd. (Note)	2006.01.03	7F, No. 96, Zhouzi St., Neihu District, Taipei	5,000,000	Property insurance agency
Fu Sheng Travel Service Co., Ltd.	2004.12.16	7F, No. 92, Zhouzi St., Neihu District, Taipei	30,000,000	Travel agency
Bebe Poshe International Co., Ltd.	2010.01.07	4F, No. 92, Zhouzi St., Neihu District, Taipei	100,000,000	Wholesaler of cosmetics
Fu Sheng Logistics Co., Ltd.	2020.02.15	8F, No 96, Zhouzi St., Neihu District, Taipei	250,000,000	Logistics
MFS Co., Ltd.	2020.07.30	14F.-6, No.1, Zhanqian, Miaoli City, Miaoli County	100,000,000	Wholesaler
Prosperous Living Co., Ltd.	2021.11.26	7F, No 98, Zhouzi St., Neihu District, Taipei	300,000,000	Wholesale and retail sales
Fortune Kingdom Corp.	2009.01.06	Maystar Chambers, P.O. Box 3269, Apia, Samoa	US$ 11,594,429	Investment
Hong Kong Fubon Multimedia Technology Co., Ltd.	2010.03.18	Unit 06, G/F, The Lodge, 535 Canton Road, Kowloon, Hong Kong	US$ 11,594,429	Investment
Hongkong Yue Numerous Investment Co., Ltd.	2015.03.12	Unit 06, G/F, The Lodge, 535 Canton Road, Kowloon, Hong Kong	HK$ 16,600,000	Investment
Haobo Information Consulting (Shenzhen) Co., Ltd.	2008.11.14	3207A, Building A, Xinghe Century Building, 3069 Caitian Road, Gangxia Community, Futian Street, Futian District, Shenzhen, China	RMB 11,000,000	Investment
Fubon Gehua(Beijing)	2010.12.08	Room 244,2nd Floor,Building	RMB 77,500,000	Wholesaler

132

Name	Date of incorporation	Address	Paid-in capital	Main business
Enterprise Ltd.		2, 241, Pingfang Road, Chaoyang District, Beijing, China

Note: Renamed as Fuli Insurance Agent Co., Ltd. in February 2023.

3. Other significant events affecting shareholders’ equity or stock price: None

4. Industries covered by affiliates’ business operations

The Company’s affiliates have set digital convergence as their core strategy across all businesses: telecommunications, cable TV, e-commerce, media and entertainment. An abundance of resources allows us to conduct both online and

offline commerce, product bundling and cross-selling by leveraging Group synergy.

133

5. Affiliates’ lists of directors, supervisors and presidents

As of December 31, 2022; Unit: share (unless otherwise stated), %

Company name	Title	Name of Representative	Shares (Note 3)	%
Taiwan Cellular Co., Ltd.	Chairman	Taiwan Mobile Co., Ltd. Representative: Daniel M. Tsai	502,970,309	100.00%
	Director	Taiwan Mobile Co., Ltd. Representative: Jamie Lin	502,970,309	100.00%
	Supervisor	Taiwan Mobile Co., Ltd. Representative: George Chang	502,970,309	100.00%
	President	Jamie Lin	-	-
Wealth Media Technology Co., Ltd.	Chairman	Taiwan Mobile Co., Ltd. Representative: Daniel M. Tsai	42,065,000	100.00%
	Director	Taiwan Mobile Co., Ltd. Representative: Jamie Lin	42,065,000	100.00%
	Supervisor	Taiwan Mobile Co., Ltd. Representative: George Chang	42,065,000	100.00%
	President	Jamie Lin	-	-
TWM Venture Co., Ltd.	Chairman	Taiwan Mobile Co., Ltd. Representative: Daniel M. Tsai	433,051,035	100.00%
	Director	Taiwan Mobile Co., Ltd. Representative: RichardM. Tsai	433,051,035	100.00%
	Supervisor	Taiwan Mobile Co., Ltd. Representative:George Chang	433,051,035	100.00%
	President	Jamie Lin	-	-
Taipei New Horizon Co., Ltd.	Chairman	Taiwan Mobile Co., Ltd. Representative: Daniel M. Tsai	191,865,500	49.90%
	Director	Taiwan Mobile Co., Ltd. Representative:JamieLin	191,865,500	49.90%
	Director	Fubon Land Development Co., Ltd. Representative:CharlesHsueh	192,634,500	50.10%
	Director	Fubon Land Development Co., Ltd. Representative:StephanieTsai	192,634,500	50.10%
	Director	Fubon Land Development Co., Ltd. Representative: Liang-Cheng Sung	192,634,500	50.10%
	Supervisor	RitaKuo	-	-
	President	Liang-ChengSung	-	-
Fu Sheng Digital Co., Ltd.	Chairman	Taiwan Mobile Co., Ltd. Representative:JamieLin	3,000,000	100.00%
	Director	Taiwan Mobile Co., Ltd. Representative: Rock Tsai	3,000,000	100.00%
	Supervisor	Taiwan Mobile Co., Ltd. Representative: Tim Lee	3,000,000	100.00%
	President	Luke Han	-	-
Taiwan Fixed Network Co., Ltd.	Chairman	Taiwan Cellular Co., Ltd. Representative: Daniel M. Tsai	2,100,000,000	100.00%
	Director	Taiwan Cellular Co., Ltd. Representative: RichardM. Tsai	2,100,000,000	100.00%
	Supervisor	Taiwan Cellular Co., Ltd. Representative:George Chang	2,100,000,000	100.00%
	President	Jamie Lin	-	-
Taiwan Teleservices & Technologies Co., Ltd.	Chairman	Taiwan Cellular Co., Ltd. Representative:JamieLin	2,484,300	100.00%
	Director	Taiwan Cellular Co., Ltd. Representative: Daniel M. Tsai	2,484,300	100.00%
	Supervisor	Taiwan Cellular Co., Ltd. Representative:George Chang	2,484,300	100.00%
	President	Steve Chou	-	-
TWM Holding Co., Ltd.	Director	Taiwan Cellular Co., Ltd. Representative: George Chang	US$ 1	100.00%
	President	(Note 1)
TCC Investment Co., Ltd.	Chairman	Taiwan Cellular Co., Ltd. Representative: Daniel M. Tsai	154,721,308	100.00%
	Director	Taiwan Cellular Co., Ltd. Representative: RichardM. Tsai	154,721,308	100.00%
	Supervisor	Taiwan Cellular Co., Ltd. Representative:George Chang	154,721,308	100.00%
	President	JamieLin	-	-
Taiwan Digital Service Co., Ltd.	Chairman	Taiwan Cellular Co., Ltd. Representative:JamieLin	2,500,000	100.00%
	Director	Taiwan Cellular Co., Ltd. Representative: Daniel M. Tsai	2,500,000	100.00%
	Supervisor	Taiwan Cellular Co., Ltd. Representative:George Chang	2,500,000	100.00%
	President	Kate Chen	-	-
Taihsin Property Insurance Agent Co.,Ltd.	Chairman	Taiwan Cellular Co., Ltd. Representative: Daniel M. Tsai	500,000	100.00%

134

Company name	Title	Name of Representative	Shares (Note 3)	%
	Director	Taiwan Cellular Co., Ltd. Representative:JamieLin	500,000	100.00%
	Director	Taiwan Cellular Co., Ltd. Representative:C.H. Wu	500,000	100.00%
	Supervisor	Taiwan Cellular Co., Ltd. Representative:JeanChang	500,000	100.00%
	President	Rita Kuo	-	-
Tai-Fu Cloud Technology Co., Ltd.	Chairman	Taiwan Cellular Co., Ltd. Representative:C.H. Wu	20,000,000	100.00%
	Director	Taiwan Cellular Co., Ltd. Representative: Allen Liou	20,000,000	100.00%
	Director	Taiwan Cellular Co., Ltd. Representative:Sara Chen	20,000,000	100.00%
	Supervisor	Taiwan Cellular Co., Ltd. Representative: RitaKuo	20,000,000	100.00%
	President	C.H. Wu	-	-
Taiwan Mobile Film Co., Ltd.	Chairman	TWM Venture Co., Ltd. Representative: Jamie Lin	1,130,000	100.00%
	Director	TWM Venture Co., Ltd. Representative: Daphne Lee	1,130,000	100.00%
	Director	TWM Venture Co., Ltd. Representative: Tim Lee	1,130,000	100.00%
	Supervisor	TWM Venture Co., Ltd. Representative: Rita Kuo	1,130,000	100.00%
	President	Daphne Lee	-	-
TFN Media Co., Ltd.	Chairman	Wealth Media Technology Co., Ltd. Representative: Daniel M. Tsai	230,921,304	100.00%
	Director	Wealth Media Technology Co., Ltd. Representative: Jamie Lin	230,921,304	100.00%
	Supervisor	Wealth Media Technology Co., Ltd. Representative: George Chang	230,921,304	100.00%
	President	Jamie Lin	-	-
Global Forest Media Technology Co., Ltd.	Chairman	Wealth Media Technology Co., Ltd. Representative: Jamie Lin	1,500,000	100.00%
	Director	Wealth Media Technology Co., Ltd. Representative: George Chang	1,500,000	100.00%
	Supervisor	Wealth Media Technology Co., Ltd. Representative: Rita Kuo	1,500,000	100.00%
	President	Jamie Lin	-	-
Global Wealth Media Technology Co., Ltd.	Chairman	Wealth Media Technology Co., Ltd. Representative:JamieLin	8,944,867	100.00%
	Director	Wealth Media Technology Co., Ltd. Representative:George Chang	8,944,867	100.00%
	Supervisor	Wealth Media Technology Co., Ltd. Representative: RitaKuo	8,944,867	100.00%
	President	Jamie Lin	-	-
Win TV Broadcasting Co., Ltd.	Chairman	Wealth Media Technology Co., Ltd. Representative:JamieLin	18,177,382	100.00%
	Director	Wealth Media Technology Co., Ltd. Representative: Daniel M. Tsai	18,177,382	100.00%
	Supervisor	Wealth Media Technology Co., Ltd. Representative:George Chang	18,177,382	100.00%
	President	Feng-Chan Cheng (Acting)	-	-
momo.com Inc.	Chairman	Wealth Media Technology Co., Ltd. Representative: Daniel M. Tsai	98,353,639	45.01%
	Director	Wealth Media Technology Co., Ltd. Representative: Jeff Ku	98,353,639	45.01%
	Director	Wealth Media Technology Co., Ltd. Representative: Jamie Lin	98,353,639	45.01%
	Director	Wealth Media Technology Co., Ltd. Representative: George Chang	98,353,639	45.01%
	Director	Wealth Media Technology Co., Ltd. Representative: Chris Tsai	98,353,639	45.01%
	Director	Tong-An Investment Co., Ltd. Representative: Mao-HsiungHuang	23,008,800	10.53%
	Independent Director	Chieh Wang	-	-
	Independent Director	Brian Y. Hsieh	-	-
	Independent Director	Hong-So Chen	-	-
	President	Jeff Ku	6,161	0.0028%
TFN Union Investment Co., Ltd.	Chairman	Taiwan Fixed Network Co., Ltd. Representative: Daniel M. Tsai	400,000	100.00%
	Director	Taiwan Fixed Network Co., Ltd. Representative: Richard M. Tsai	400,000	100.00%
	Supervisor	Taiwan Fixed Network Co.,Ltd.	400,000	100.00%

135

Company name	Title	Name of Representative	Shares (Note 3)	%
		Representative: George Chang
	President	Jamie Lin	-	-
TWM Communications (Beijing) Ltd.	Chairman	TWM Holding Co., Ltd. Representative: Tom Koh	US$ 3,000,000	100.00%
	Director	TWM Holding Co., Ltd. Representative: Tim Lee	US$ 3,000,000	100.00%
	Director	TWM Holding Co., Ltd. Representative:C.H. Wu	US$ 3,000,000	100.00%
	Supervisor	TWM Holding Co., Ltd. Representative:George Chang	US$ 3,000,000	100.00%
	President	Tom Koh	-	-
TCCI Investment and Development Co., Ltd.	Chairman	TCC Investment Co., Ltd.. Representative: Daniel M. Tsai	104,712,000	100.00%
	Director	TCC Investment Co., Ltd. Representative: Richard M. Tsai	104,712,000	100.00%
	Supervisor	TCC Investment Co., Ltd. Representative: George Chang	104,712,000	100.00%
	President	Jamie Lin	-	-
Taiwan Stampede Franchise Film Co., Ltd.	Chairman	TWM Venture Co., Ltd. Representative: Jamie Lin	30,000	100.00%
	Director	TWM Venture Co., Ltd. Representative: Daphne Lee	30,000	100.00%
	Director	TWM Venture Co., Ltd. Representative: Tim Lee	30,000	100.00%
	Supervisor	TWM Venture Co., Ltd. Representative: Rita Kuo	30,000	100.00%
	President	Jamie Lin	-	-
Taiwan Kuro Times Co., Ltd.	Chairman	TFN Media Co., Ltd. Representative: Jamie Lin	14,700,000	100.00%
	Director	TFN Media Co., Ltd. Representative: Daphne Lee	14,700,000	100.00%
	Supervisor	TFN Media Co., Ltd. Representative: George Chang	14,700,000	100.00%
	President	Daphne Lee	-	-
Yeong Jia Leh Cable TV Co., Ltd.	Chairman	TFN Media Co., Ltd. Representative: Jamie Lin	33,940,000	100.00%
	Director	TFN Media Co., Ltd. Representative: Tom Koh	33,940,000	100.00%
	Director	TFN Media Co., Ltd. Representative: George Chang	33,940,000	100.00%
	Director	TFN Media Co., Ltd. Representative: C.H. Wu	33,940,000	100.00%
	Director	TFN Media Co., Ltd. Representative: Min-Chieh Yang	33,940,000	100.00%
	Supervisor	TFN Media Co., Ltd. Representative: JayHong	33,940,000	100.00%
	Supervisor	TFN Media Co., Ltd. Representative: Rita Kuo	33,940,000	100.00%
	President	Min-Chieh Yang	-	-
Mangrove Cable TV Co., Ltd.	Chairman	Dai-Ka Ltd. Representative: Chao-Nan Kuo	14,912,000	70.47%
	Director	Dai-Ka Ltd. Representative: Yao-TungLee	14,912,000	70.47%
	Independent Director	Eric Chang	-	-
	Independent Director	Joe-Hsiang Lin	-	-
	Independent Director	Hsiu-Lan Wang	-	-
	President	Yao-TungLee	-	-
Phoenix Cable TV Co., Ltd.	Chairman	TFN Media Co., Ltd. Representative: Jamie Lin	68,090,198	100.00%
	Director	TFN Media Co., Ltd. Representative: Tom Koh	68,090,198	100.00%
	Director	TFN Media Co., Ltd. Representative: George Chang	68,090,198	100.00%
	Director	TFN Media Co., Ltd. Representative: C.H. Wu	68,090,198	100.00%
	Director	TFN Media Co., Ltd. Representative: Chen-Lu Lin	68,090,198	100.00%
	Supervisor	TFN Media Co., Ltd. Representative: JayHong	68,090,198	100.00%
	Supervisor	TFN Media Co., Ltd. Representative: Rita Kuo	68,090,198	100.00%
	President	Chen-Lu Lin	-	-

136

Company name	Title	Name of Representative	Shares (Note 3)	%
Union Cable TV Co., Ltd.	Chairman	TFN Media Co., Ltd. Representative: Jamie Lin	169,141,000	99.22%
	Director	TFN Media Co., Ltd. Representative: Tom Koh	169,141,000	99.22%
	Director	TFN Media Co., Ltd. Representative: George Chang	169,141,000	99.22%
	Director	TFN Media Co., Ltd. Representative: C.H. Wu	169,141,000	99.22%
	Director	TFN Media Co., Ltd. Representative: Hung-Chun Chou	169,141,000	99.22%
	Supervisor	Global Forest Media Technology Co., Ltd. Representative: JayHong	1,300,326	0.76%
	Supervisor	Rita Kuo	-	-
	President	Hung-Chun Chou	-	-
Globalview Cable TV Co., Ltd.	Chairman	TFN Media Co., Ltd. Representative: Jamie Lin	51,733,200	92.38%
	Director	TFN Media Co., Ltd. Representative: Tom Koh	51,733,200	92.38%
	Director	TFN Media Co., Ltd. Representative: George Chang	51,733,200	92.38%
	Director	TFN Media Co., Ltd. Representative: C.H. Wu	51,733,200	92.38%
	Director	TFN Media Co., Ltd. Representative: Sheng-HungLin	51,733,200	92.38%
	Supervisor	Global Wealth Media Technology Co., Ltd. Representative: JayHong	3,825,333	6.83%
	Supervisor	Rita Kuo	-	-
	President	Sheng-HungLin	-	-
Asian Crown International Co.,Ltd.	Director	momo.com Inc.	US$9,735,459	81.99%
	President	(Note 1)
Honest Development Co., Ltd.	Director	momo.com Inc.	US$21,778,413	100.00%
	President	(Note 1)
Fuli Life Insurance Agent Co., Ltd.	Chairman	momo.com Inc. Representative: C.F. Lin	500,000	100.00%
	Director	momo.com Inc. Representative: Jeff Ku	500,000	100.00%
	Director	momo.com Inc. Representative: Julia Chou	500,000	100.00%
	Supervisor	momo.com Inc. Representative: Summer Hsieh	500,000	100.00%
	President	C.F. Lin	-	-
Fuli Property Insurance Agent Co., Ltd.(Note 2)	Chairman	momo.com Inc. Representative: Gina Lu	500,000	100.00%
	Director	momo.com Inc. Representative: JeremyHong	500,000	100.00%
	Director	momo.com Inc. Representative: Jeff Ku	500,000	100.00%
	Supervisor	momo.com Inc. Representative: Hana Hsieh	500,000	100.00%
	President	Gina Lu	-	-
Fu Sheng Travel Service Co., Ltd.	Chairman	momo.com Inc. Representative: Jeff Ku	3,000,000	100.00%
	Director	momo.com Inc. Representative: Gina Lu	3,000,000	100.00%
	Director	momo.com Inc. Representative: JeremyHong	3,000,000	100.00%
	Supervisor	momo.com Inc. Representative: TerryLee	3,000,000	100.00%
	President	(Note 1)
Bebe Poshe International Co., Ltd.	Chairman	momo.com Inc. Representative: Jeff Ku	8,867,500	88.68%
	Director	Jennifer Lin	-	-
	Director	momo.com Inc. Representative: Summer Hsieh	8,867,500	88.68%
	Director	momo.com Inc. Representative: Roxanne Chiu	8,867,500	88.68%
	Director	momo.com Inc. Representative: JeremyHong	8,867,500	88.68%
	Supervisor	Gina Lu	-	-
	President	Summer Hsieh	-	-

137

Company name	Title	Name of Representative	Shares (Note 3)	%
Fu Sheng Logistics Co., Ltd.	Chairman	momo.com Inc. Representative: Jeff Ku	25,000,000	100.00%
	Director	momo.com Inc. Representative: Leanne Wang	25,000,000	100.00%
	Director	momo.com Inc. Representative: Robinson Lin	25,000,000	100.00%
	Supervisor	momo.com Inc. Representative: Gina Lu	25,000,000	100.00%
	President	Leanne Wang	-	-
MFS Co., Ltd.	Chairman	momo.com Inc. Representative: Jeff Ku	10,000,000	100.00%
	Director	momo.com Inc. Representative: Summer Hsieh	10,000,000	100.00%
	Director	momo.com Inc. Representative: AllyYu	10,000,000	100.00%
	Supervisor	momo.com Inc. Representative: JeremyHong	10,000,000	100.00%
	President	AllyYu	-	-
Prosperous Living Co., Ltd.	Chairman	momo.com Inc. Representative: Jeff Ku	22,085,000	73.62%
	Director	momo.com Inc. Representative: JeremyHong	22,085,000	73.62%
	Director	momo.com Inc. Representative: Roxanne Chiu	22,085,000	73.62%
	Supervisor	Gina Lu	100,000	0.33%
	President	Roxanne Chiu	100,000	0.33%
Fortune Kingdom Corp.	Director	Asian Crown International Co.,Ltd.	US$11,594,429	100.00%
	President	(Note 1)
Hong Kong Fubon Multimedia Technology Co., Ltd.	Director	Fortune Kingdom Corp.	US$11,594,429	100.00%
	Director	Jeff Ku	-	-
	President	(Note 1)
Hongkong Yue Numerous Investment Co., Ltd.	Director	Honest Development Co.,Ltd.	HK$16,600,000	100.00%
	Director	Jeff Ku	-	-
	President	(Note 1)
Haobo Information Consulting (Shenzhen) Co., Ltd	Chairman	Hongkong Yue Numerous Investment Co., Ltd. Representative: Jeff Ku	RMB 11,000,000	100.00%
	Supervisor	Hongkong Yue Numerous Investment Co., Ltd. Representative: Gina Lu	RMB 11,000,000	100.00%
	President	Summer Hsieh	-	-
Fubon Gehua (Beijing) Enterprise Ltd.	Chairman	Hong Kong Fubon Multimedia Technology Co., Ltd. Representative: C.F. Lin	RMB 72,499,800	93.55%
	Director	Hong Kong Fubon Multimedia Technology Co., Ltd. Representative: Jeff Ku	RMB 72,499,800	93.55%
	Director	Hong Kong Fubon Multimedia Technology Co., Ltd. Representative: JeremyHong	RMB 72,499,800	93.55%
	Director	Hong Kong Fubon Multimedia Technology Co., Ltd. Representative: Nien-Pei Tsai	RMB 72,499,800	93.55%
	Director	Prosperous Group (Asia) Ltd. Representative: Pei-Yin Yu	RMB 5,000,200	6.45%
	Supervisor	Hong Kong Fubon Multimedia Technology Co., Ltd. Representative: Summer Hsieh	RMB 72,499,800	93.55%
	Supervisor	Hong Kong Fubon Multimedia Technology Co., Ltd. Representative: Gina Lu	RMB 72,499,800	93.55%
	President	C.F. Lin	-	-

Note 1: No President

Note 2: Renamed as Fuli Insurance Agent Co., Ltd. in February 2023 Note 3: No. of shares unless stated otherwise, i.e., paid-in capital in foreign denomination

138

6. Affiliates’ operating highlights

						As of December 31, 2022; Unit: NT$’000 Operating income Net income EPS (NT$) (1,111) 3,905,482 7.76 (193) 3,173,222 75.44 (10,091) 120,947 0.39 207,393 115,316 0.30 (4,076) (3,246) (1.08) 4,345,995 3,538,184 1.68 59,298 48,442 19.50 (154) 19,397 19,396,391 256 2,120 0.01 10,322 8,651 3.46 125,463 100,571 201.14 25,886 67,009 3.35 1,811,759 1,598,631 6.92 (132) 123 0.08 (158) 2,231 0.25 163,465 126,931 6.98 4,143,236 3,434,626 15.72 (149) (184) (0.16) (76) (76) (0.19) (370) 1,381 NA (76) (76) (0.00) (89) (46) (1.53) 50,530 43,930 2.99 (62,972) (61,672) (1.82) 29,312 24,943 1.18 144,465 122,399 1.80 38,534 33,236 0.19 39,139 34,946 0.62 (104) (3,448) (0.29) - (99,495) (4.57) (2,276) (2,280) (4.56) 4,358 3,515 7.03 6,090 5,577 1.86 (5,813) (5,790) (0.58) 146,473 118,512 4.74 (3,323) (2,380) (0.24) 3,941 4,232 0.14 - (3,834) (0.33) (126) (3,834) (0.33)	As of December 31, 2022; Unit: NT$’000 Operating income Net income EPS (NT$) (1,111) 3,905,482 7.76 (193) 3,173,222 75.44 (10,091) 120,947 0.39 207,393 115,316 0.30 (4,076) (3,246) (1.08) 4,345,995 3,538,184 1.68 59,298 48,442 19.50 (154) 19,397 19,396,391 256 2,120 0.01 10,322 8,651 3.46 125,463 100,571 201.14 25,886 67,009 3.35 1,811,759 1,598,631 6.92 (132) 123 0.08 (158) 2,231 0.25 163,465 126,931 6.98 4,143,236 3,434,626 15.72 (149) (184) (0.16) (76) (76) (0.19) (370) 1,381 NA (76) (76) (0.00) (89) (46) (1.53) 50,530 43,930 2.99 (62,972) (61,672) (1.82) 29,312 24,943 1.18 144,465 122,399 1.80 38,534 33,236 0.19 39,139 34,946 0.62 (104) (3,448) (0.29) - (99,495) (4.57) (2,276) (2,280) (4.56) 4,358 3,515 7.03 6,090 5,577 1.86 (5,813) (5,790) (0.58) 146,473 118,512 4.74 (3,323) (2,380) (0.24) 3,941 4,232 0.14 - (3,834) (0.33) (126) (3,834) (0.33)	As of December 31, 2022; Unit: NT$’000 Operating income Net income EPS (NT$) (1,111) 3,905,482 7.76 (193) 3,173,222 75.44 (10,091) 120,947 0.39 207,393 115,316 0.30 (4,076) (3,246) (1.08) 4,345,995 3,538,184 1.68 59,298 48,442 19.50 (154) 19,397 19,396,391 256 2,120 0.01 10,322 8,651 3.46 125,463 100,571 201.14 25,886 67,009 3.35 1,811,759 1,598,631 6.92 (132) 123 0.08 (158) 2,231 0.25 163,465 126,931 6.98 4,143,236 3,434,626 15.72 (149) (184) (0.16) (76) (76) (0.19) (370) 1,381 NA (76) (76) (0.00) (89) (46) (1.53) 50,530 43,930 2.99 (62,972) (61,672) (1.82) 29,312 24,943 1.18 144,465 122,399 1.80 38,534 33,236 0.19 39,139 34,946 0.62 (104) (3,448) (0.29) - (99,495) (4.57) (2,276) (2,280) (4.56) 4,358 3,515 7.03 6,090 5,577 1.86 (5,813) (5,790) (0.58) 146,473 118,512 4.74 (3,323) (2,380) (0.24) 3,941 4,232 0.14 - (3,834) (0.33) (126) (3,834) (0.33)
Company name	Paid-in capital	Total assets	Total liabilities	Net worth	Operating revenue	Operating income	Net income	EPS (NT$)
Taiwan Cellular Co., Ltd.	5,029,703	79,330,938	308,425	79,022,513	-	(1,111)	3,905,482	7.76
Wealth Media Technology Co., Ltd.	420,650	22,550,029	3,459	22,546,570	-	(193)	3,173,222	75.44
TWM Venture Co., Ltd.	4,330,510	4,643,170	38,172	4,604,998	-	(10,091)	120,947	0.39
Taipei New Horizon Co., Ltd.	3,845,000	7,109,788	3,185,961	3,923,827	578,474	207,393	115,316	0.30
Fu Sheng Digital Co., Ltd.	30,000	30,788	4,034	26,754	-	(4,076)	(3,246)	(1.08)
Taiwan Fixed Network Co., Ltd.	21,000,000	56,272,213	4,733,548	51,538,665	9,724,861	4,345,995	3,538,184	1.68
Taiwan Teleservices & Technologies Co., Ltd.	24,843	494,657	339,645	155,012	1,056,670	59,298	48,442	19.50
TWM Holding Co. Ltd.	0.032	241,941	45	241,896	-	(154)	19,397	19,396,391
TCC Investment Co., Ltd.	1,547,213	26,304,386	409,652	25,894,734	410	256	2,120	0.01
Taiwan Digital Service Co., Ltd.	25,000	139,744	36,700	103,044	220,947	10,322	8,651	3.46
Taihsin Property Insurance Agent Co., Ltd.	5,000	223,824	113,253	110,571	350,495	125,463	100,571	201.14
Tai-Fu Cloud Co., Ltd.	200,000	574,604	328,002	246,602	472,033	25,886	67,009	3.35
TFN Media Co., Ltd.	2,309,213	13,631,051	3,369,481	10,261,570	3,577,281	1,811,759	1,598,631	6.92
Global Forest Media Technology Co., Ltd.	15,000	17,475	51	17,424	-	(132)	123	0.08
Global Wealth Media Technology Co., Ltd.	89,449	97,963	78	97,885	-	(158)	2,231	0.25
Win TV Broadcasting Co., Ltd.	181,774	1,099,020	710,442	388,578	1,050,562	163,465	126,931	6.98
momo.com Inc.	2,184,913	26,108,186	16,292,811	9,815,375	103,403,362	4,143,236	3,434,626	15.72
TWM Film Co., Ltd.	11,300	11,063	9	11,054	-	(149)	(184)	(0.16)
TFN Union Investment Co., Ltd.	4,000	38,890,444	994,631	37,895,813	-	(76)	(76)	(0.19)
TWM Communications (Beijing) Co., Ltd.	92,175	83,475	73	83,402	-	(370)	1,381	NA
TCCI Investment and Development Co., Ltd.	1,047,120	8,296,422	212,180	8,084,242	2	(76)	(76)	(0.00)
Taiwan Stampede Franchise Film Co., Ltd.	300	254	-	254	-	(89)	(46)	(1.53)
Taiwan Kuro Times Co., Ltd.	147,000	280,542	58,223	222,319	275,891	50,530	43,930	2.99
Yeong Jia Leh Cable TV Co., Ltd.	339,400	463,701	418,777	44,924	739,802	(62,972)	(61,672)	(1.82)
Mangrove Cable TV Co., Ltd.	211,600	596,830	231,379	365,451	399,064	29,312	24,943	1.18
Phoenix Cable TV Co., Ltd.	680,902	1,565,160	424,764	1,140,396	1,104,762	144,465	122,399	1.80
Union Cable TV Co., Ltd.	1,704,633	2,198,427	335,259	1,863,168	609,125	38,534	33,236	0.19
Globalview Cable TV Co., Ltd.	560,000	923,172	214,054	709,118	431,235	39,139	34,946	0.62
Asian Crown International Co., Ltd.	364,890	21,352	-	21,352	-	(104)	(3,448)	(0.29)
Honest Development Co., Ltd.	670,448	560,502	-	560,502	-	-	(99,495)	(4.57)
Fuli Life Insurance Agent Co., Ltd.	5,000	3,259	337	2,922	339	(2,276)	(2,280)	(4.56)
Fuli Property Insurance Agent Co., Ltd. (Note 2)	5,000	15,543	2,560	12,983	12,372	4,358	3,515	7.03
Fu Sheng Travel Service Co., Ltd.	30,000	217,929	171,317	46,612	8,816	6,090	5,577	1.86
Bebe Poshe International Co., Ltd.	100,000	33,377	1,854	31,523	38,303	(5,813)	(5,790)	(0.58)
Fu Sheng Logistics Co., Ltd.	250,000	573,093	198,680	374,413	915,827	146,473	118,512	4.74
MFS Co., Ltd.	100,000	145,159	46,760	98,399	268,552	(3,323)	(2,380)	(0.24)
Prosperous Living Co., Ltd.	300,000	312,089	8,037	304,052	35,514	3,941	4,232	0.14
Fortune Kingdom Corp.	356,500	16,913	-	16,913	-	-	(3,834)	(0.33)
Hong Kong Fubon Multimedia Technology Co.,Ltd.	356,500	16,913	-	16,913	-	(126)	(3,834)	(0.33)

139

Company name	Paid-in capital	Total assets	Total liabilities	Net worth	Operating revenue	Operating income	Net income	EPS (NT$)
Hongkong Yue Numerous Investment Co., Ltd.	66,035	560,502	-	560,502	-	-	(99,495)	(5.99)
Haobo Information Consulting (Shenzhen) Co., Ltd.	48,411	531,879	-	531,879	-	(221)	(100,135)	NA
Fubon Gehua (Beijing) Enterprise Ltd.	341,076	14,473	5,378	9,095	5,843	(9,408)	(4,943)	NA

Note 1: Exchange rates: US$1=NT$30.725, HK$1=NT$3.942, and RMB1=NT$4.401 as of December 31, 2022 Average exchange rates: US$1=NT$29.788, HK$1=NT$3.804, and RMB1=NT$4.42 for 2022

Note 2: Renamed as Fuli Insurance Agent Co., Ltd. in February 2023.

Private placement of company shares: None

TWM shares held / sold by subsidiaries

			Unit：NT$ ‘000,%
Subsidiary	TCC Investment Co., Ltd. (TCCI)	TFN Union Investment Co., Ltd. (TUI)	TCCI Investment and Development Co., Ltd. (TID)
Paid-in capital	1,547,213	4,000	1,047,120
Source of funding	Equity	TFN established TUI with the shares of the Company	TFN Investment (Note 1) established TID with the shares of the Company
% owned by the Company	100%	100%	100%
Acquisition / disposal date	－	－	－
No. of shares acquired and payment costs	－	－	－
No. of shares sold / proceeds	－	－	－
Investment income	－	－	－
Up to publication date: Total No. of shares / value `（`Note 2`）`	200,496,761 shares / NT$12,163,470	410,665,284 shares / NT$22,312,814	87,589,556 shares / NT$4,759,033
Pledges	None	None	None
Guarantees / endorsements provided by the Company	－	－	－
Financing provided by the Company	－	－	－

Note 1 ： TFN Investment was merged into TCC Investment Co., Ltd. on September 19, 2009. Note 2 ： Ending balance is carrying cost and does not include evaluation gains/losses.

Other supplementary information: None

Other significant events affecting shareholders’ equity or stock price: None

140

Taiwan Mobile Co., Ltd. and Subsidiaries

Consolidated Financial Statements for the Years Ended December 31, 2022 and 2021 and Independent Auditors’ Report

REPRESENTATION LETTER

The entities that are required to be included in the consolidated financial statements of affiliates in accordance with the “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” for the year ended December 31, 2022 are all the same as those included in the consolidated financial statements of Taiwan Mobile Co., Ltd. and its subsidiaries prepared in conformity with the International Financial Reporting Standard 10 “Consolidated Financial Statements”. Relevant information that should be disclosed in the consolidated financial statements of affiliates is included in the consolidated financial statements of Taiwan Mobile Co., Ltd. and its subsidiaries. Hence, we did not prepare a separate set of consolidated financial statements of affiliates.

Very truly yours,

TAIWAN MOBILE CO., LTD.

Daniel M. Tsai Chairman February 24, 2023

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Stockholders Taiwan Mobile Co., Ltd.

Opinion

We have audited the accompanying consolidated financial statements of Taiwan Mobile Co., Ltd. and its subsidiaries (collectively, the “Group”), which comprise the consolidated balance sheets as of December 31, 2022 and 2021, and the consolidated statements of comprehensive income, consolidated statements of changes in equity and consolidated statements of cash flows for the years then ended, and the related notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2022 and 2021, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission (FSC) of the Republic of China (ROC).

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and the Standards on Auditing of the ROC. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with The Norm of Professional Ethics for Certified Public Accountant of the ROC, 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 consolidated financial statements for the year ended December 31, 2022. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

The descriptions of the key audit matters of the 2022 consolidated financial statements are as follows:

Telecommunications and Value-added Services Revenue

The description of key audit matter:

One of the operating revenue sources of the Group is the telecommunications and value-added services revenue. The Group offers more different monthly-fee plans and diversifies the business by innovating value-added services since the telecommunication industry becomes more competitive nowadays. The

competitive telecommunication industry and complicated calculations for revenue recognition, which highly relies on automatic and systematic connection and implementation, lead the telecommunications and value-added services revenue to be considered as one of the key audit matters.

Corresponding audit procedures:

By conducting compliance tests, we obtained an understanding of the telecommunication revenue recognition process and of the design and execution for relevant controls. We also performed major audit procedures which are as follows:

Review the contracts of mobile subscribers to ensure the accuracy of information in the accounting system.
Perform dialing tests to verify the completeness of the information in the telephone exchange system.
Perform system integration tests from telephone-exchange to telephone traffic.
Test for the accuracy of call record charge rates and billing calculations.
Verify the accuracy of the billing amounts generated from monthly rentals as well as airtime accounting systems and the transfer to the accounting information system.
Select the samples from telecommunications and value-added services revenue and agree to the contracts, bills and records of cash receipts.

Sales Revenue

The description of key audit matter:

The Group’s another source of operating revenue is generated from the sales through virtual channels, including E-commerce portals, TV shopping channels and catalogues by momo.com Inc. (momo). Due to the nature of momo’s core sales, momo offers a wide range of products and services to different customers; the trading quantity is rather high while each transaction is individually low in value and is highly automated through the website and related system. As a result of momo’s business model being highly reliant on IT infrastructure and the fact that momo processes, stores and transmits large amounts of data through digital and web-based environment, the risk in revenue recognition is whether the sales amount is transmitted and recorded accurately to the IT system.

Corresponding audit procedures:

By conducting compliance tests, we obtained an understanding of the revenue recognition process and of the design and execution for relevant controls. We also performed major audit procedures which are as follows:

Verify the details of invoices in the system to check if the sales amount of each invoice is consistent with its shipping notice and sales order.
Confirm the completeness and consistency of transmission through IT system by testing the information transferred from front-end system to general ledger system, and further perform tests on whether the Daily Sales Report in the system is consistent with journal entries of revenue each day.

Other Matter

We have also audited the parent company only financial statements of Taiwan Mobile Co., Ltd. as of and for the years ended December 31, 2022 and 2021 on which we have issued an unmodified opinion.

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

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

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

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
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 and is related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.
4 -
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

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

We also provide those charged with governance with 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 consolidated financial statements for the year ended December 31, 2022 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

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

Deloitte & Touche Taipei, Taiwan Republic of China

February 24, 2023

Notice to Readers

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

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

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 6 and 29) Financial assets at fair value through other comprehensive income (Note 7) Contract assets (Note 22) Notes and accounts receivable, net (Note 8) Notes and accounts receivable due from related parties (Note 29) Other receivables (Note 29) Inventories (Note 9) Prepayments (Note 29) Other financial assets (Notes 29 and 30) Other current assets Total current assets NON-CURRENT ASSETS Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income (Note 7) Contract assets (Note 22) Investments accounted for using equity method (Notes 10 and 29) Property, plant and equipment (Notes 12 and 29) Right-of-use assets (Notes 13 and 29) Investment properties (Note 14) Concessions (Notes 15 and 30) Goodwill (Note 15) Other intangible assets (Note 15) Deferred tax assets (Note 24) Incremental costs of obtaining a contract (Note 22) Other financial assets (Notes 29 and 30) Other non-current assets (Notes 16 and 29) Total non-current assets		December 31, 2022 Amount % $ 14,934,740 8 249,824 - 5,092,822 3 7,711,033 4 576,760 - 3,359,268 2 8,101,340 4 572,104 - 646,289 - 194,920 - 41,439,100 21 1,181,015 - 4,786,843 3 5,397,742 3 1,794,033 1 44,247,993 23 9,784,277 5 2,734,429 2 56,178,122 29 15,819,108 8 4,874,135 3 575,978 - 1,913,755 1 373,125 - 1,972,011 1 151,632,566 79		December 31, 2021 Amount % $ 15,402,025 8 268,393 - 4,667,271 2 7,381,414 4 383,074 - 2,734,657 2 6,440,116 4 527,355 - 665,606 - 182,127 - 38,652,038 20 273,767 - 3,702,635 2 5,199,779 3 1,880,489 1 43,439,740 23 9,059,855 5 2,591,691 1 60,493,425 32 15,819,108 8 5,015,030 3 709,744 - 1,828,387 1 358,570 - 1,958,269 1 152,330,489 80

TOTAL $ 193,071,666 100 $ 190,982,527 100

LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 17) Short-term notes and bills payable (Note 17) Contract liabilities (Note 22) Notes and accounts payable Notes and accounts payable due to related parties (Note 29) Other payables (Note 29) Current tax liabilities Provisions (Note 19) Lease liabilities (Notes 13, 26 and 29) Advance receipts Long-term liabilities, current portion (Notes 17 and 18) Other current liabilities (Note 29) Total current liabilities NON-CURRENT LIABILITIES Contract liabilities (Note 22) Bonds payable (Note 18) Long-term borrowings (Note 17) Provisions (Note 19) Deferred tax liabilities (Note 24) Lease liabilities (Notes 13, 26 and 29) Net defined benefit liabilities (Note 20) Guarantee deposits Other non-current liabilities Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT (Note 21) Common stock Capital collected in advance Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Other equity interests Treasury stock Total equity attributable to owners of the parent NON-CONTROLLING INTERESTS Total equity TOTAL		December 31, 2022 Amount % $ 20,550,000 11 3,092,395 2 2,079,999 1 13,847,707 7 133,150 - 10,373,509 5 2,537,557 1 80,467 - 3,693,801 2 164,474 - 9,772,757 5 3,242,300 2 69,568,116 36 97,845 - 31,481,943 16 6,282,531 3 1,440,590 1 1,278,223 1 6,155,641 3 108,631 - 1,310,619 1 2,496,747 1 50,652,770 26 120,220,886 62 35,192,336 18 - - 15,326,778 8 32,603,345 17 1,823,415 1 8,954,012 5 288,214 - (29,717,344) (15) 64,470,756 34 8,380,024 4 72,850,780 38 $ 193,071,666 100		December 31, 2021
				Amount % $ 20,510,000 11 4,597,793 2 1,894,828 1 11,618,449 6 338,560 - 11,000,399 6 2,549,382 1 74,007 - 3,540,466 2 65,615 - 273,459 - 3,023,814 2 59,486,772 31 89,480 - 37,475,497 20 8,556,973 4 1,392,321 1 1,204,261 1 5,552,881 3 463,562 - 1,263,822 1 2,219,960 1 58,218,757 31 117,705,529 62 35,135,201 18 57,135 - 16,903,239 9 31,500,472 17 2,449,739 1 11,028,726 6 (1,823,415) (1) (29,717,344) (16) 65,533,753 34 7,743,245 4 73,276,998 38 $ 190,982,527 100

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

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUES (Notes 22, 29 and 35) OPERATING COSTS (Notes 9, 29, 33 and 35) GROSS PROFIT FROM OPERATIONS OPERATING EXPENSES (Notes 29, 33 and 35) Marketing Administrative Research and development Expected credit loss Total operating expenses OTHER INCOME AND EXPENSES, NET (Note 29) OPERATING INCOME (Note 35) NON-OPERATING INCOME AND EXPENSES Interest income Other income Other gains and losses, net (Note 23) Finance costs (Note 23) Share of profit (loss) of associates accounted for using equity method (Note 10) Total non-operating income and expenses PROFIT BEFORE TAX INCOME TAX EXPENSE (Note 24) NET PROFIT OTHER COMPREHENSIVE INCOME (LOSS) (Notes 10, 20, 21 and 24) Items that will not be reclassified subsequently to profit or loss: Remeasurements of defined benefit plans Unrealized gain (loss) on investments in equity instruments at fair value through other comprehensive income Share of other comprehensive loss of associates accounted for using equity method Items that may be reclassified subsequently to profit or loss: Exchange differences on translation Share of other comprehensive income (loss) of associates accounted for using equity method Other comprehensive income (after tax) TOTAL COMPREHENSIVE INCOME NET PROFIT ATTRIBUTABLE TO: Owners of the parent Non-controlling interests TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO: Owners of the parent Non-controlling interests EARNINGS PER SHARE (Note 25) Basic earnings per share Diluted earnings per share		2022 Amount % $ 172,206,112 100 138,980,890 81 33,225,222 19 10,434,740 6 6,059,250 3 391,273 - 258,214 - 17,143,477 9 810,994 - 16,892,739 10 110,440 - 55,497 - (140,445) - (737,134) - 10,145 - (701,497) - 16,191,242 10 3,219,830 2 12,971,412 8 259,364 - (229,984) - (24,230) - 31,519 - 6,030 - 42,699 - $ 13,014,111 8 $ 11,025,551 7 1,945,861 1 $ 12,971,412 8 $ 11,068,344 7 1,945,767 1 $ 13,014,111 8 $ 3.91 $ 3.90		2021
				Amount % $ 156,109,533 100 124,734,936 80 31,374,597 20 10,007,715 6 5,530,575 4 242,608 - 224,659 - 16,005,557 10 684,001 - 16,053,041 10 56,370 - 25,398 - 94,260 - (627,813) - (19,681) - (471,466) - 15,581,575 10 2,756,366 2 12,825,209 8 28,469 - 679,028 - (11,865) - (26,698) - (1,712) - 667,222 - $ 13,492,431 8 $ 10,988,165 7 1,837,044 1 $ 12,825,209 8 $ 11,662,701 7 1,829,730 1 $ 13,492,431 8 $ 3.90 $ 3.89

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

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

BALANCE, JANUARY 1, 2021 Distribution of 2020 earnings Legal reserve Special reserve Cash dividends Total distribution of earnings Cash dividends from capital surplus Profit for the year ended December 31, 2021 Other comprehensive income (loss) for the year ended December 31, 2021 Total comprehensive income (loss) for the year ended December 31, 2021 Conversion of convertible bonds to common stock Disposal of investments in equity instruments designated as at fair value through other comprehensive income Changes in equity of associates accounted for using equity method Disposal of investments accounted for using equity method Other changes in capital surplus Cash dividends for non-controlling interests of subsidiaries Increase in non-controlling interests BALANCE, DECEMBER 31, 2021 Distribution of 2021 earnings Legal reserve Reversal of special reserve Cash dividends Total distribution of earnings Cash dividends from capital surplus Profit for the year ended December 31, 2022 Other comprehensive income (loss) for the year ended December 31, 2022 Total comprehensive income (loss) for the year ended December 31, 2022 Conversion of convertible bonds to common stock Transfer and disposal of investments in equity instruments designated as at fair value through other comprehensive income Difference between consideration and carrying amount of subsidiaries acquired Changes in equity of associates accounted for using equity method Changes in equity associated with non-current assets held for sale Other changes in capital surplus Cash dividends for non-controlling interests of subsidiaries BALANCE, DECEMBER 31, 2022			Equity Attributable to Owners of the Parent	Equity Attributable to Owners of the Parent	Total Non-controlling Interests $ 65,365,100 $ 6,625,112 - - - - (9,521,178) - (9,521,178) - (2,577,603) - 10,988,165 1,837,044 674,536 (7,314) 11,662,701 1,829,730 626,065 - - - (1,257) 734 (21,913) (20,968) 1,838 - - (770,513) - 79,150 65,533,753 7,743,245 - - - - (10,551,987) - (10,551,987) - (1,576,086) - 11,025,551 1,945,861 42,793 (94) 11,068,344 1,945,767 - - - - (2,140) (3,740) (753) (684) (2,223) (2,717) 1,848 - - (1,301,847) $ 64,470,756 $ 8,380,024	Total Equity $ 71,990,212 - - (9,521,178) (9,521,178) (2,577,603) 12,825,209 667,222 13,492,431 626,065 - (523) (42,881) 1,838 (770,513) 79,150 73,276,998 - - (10,551,987) (10,551,987) (1,576,086) 12,971,412 42,699 13,014,111 - - (5,880) (1,437) (4,940) 1,848 (1,301,847) $ 72,850,780
	Common Stock $ 35,124,215 - - - - - - - - 10,986 - - - - - - 35,135,201 - - - - - - - - 57,135 - - - - - - $ 35,192,336	Capital Collected in Advance Capital Surplus $ - $ 18,936,574 - - - - - - - - - (2,577,603) - - - - - - 57,135 557,944 - - - 6,399 - (21,913) - 1,838 - - - - 57,135 16,903,239 - - - - - - - - - (1,576,086) - - - - - - (57,135) - - - - - - - - (2,223) - 1,848 - - $ - $ 15,326,778	Retained Earnings Legal Reserve Special Reserve Unappropriated Earnings $ 30,170,398 $ - $ 13,300,996 1,330,074 - (1,330,074) - 2,449,739 (2,449,739) - - (9,521,178) 1,330,074 2,449,739 (13,300,991) - - - - - 10,988,165 - - 28,385 - - 11,016,550 - - - - - (2,209) - - (8,505) - - 22,885 - - - - - - - - - 31,500,472 2,449,739 11,028,726 1,102,873 - (1,102,873) - (626,324) 626,324 - - (10,551,987) 1,102,873 (626,324) (11,028,536) - - - - - 11,025,551 - - 258,116 - - 11,283,667 - - - - - (2,326,952) - - (2,140) - - (753) - - - - - - - - - $ 32,603,345 $ 1,823,415 $ 8,954,012	Other Equity Interests Exchange Unrealized Gain (Loss) on Financial Assets at Fair Value Through Other Differences on Translation Comprehensive Income Treasury Stock $ (31,679) $ (2,418,060) $ (29,717,344) - - - - - - - - - - - - - - - - - - (12,615) 658,766 - (12,615) 658,766 - - - - - 2,209 - - 849 - - (22,885) - - - - - - - - - - (44,294) (1,779,121) (29,717,344) - - - - - - - - - - - - - - - - - - 16,432 (231,755) - 16,432 (231,755) - - - - - 2,326,952 - - - - - - - - - - - - - - - - $ (27,862) $ 316,076 $ (29,717,344)

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

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments for: Depreciation expense Amortization expense Amortization of incremental costs of obtaining a contract (Gain) loss on disposal and retirement of property, plant and equipment, net Gain on disposal of property, plant and equipment held for sale Expected credit loss Other income and expenses Finance costs Interest income Dividend income Valuation (gain) loss on financial assets at fair value through profit or loss Share of (profit) loss of associates accounted for using equity method Gain on disposal of investments accounted for using equity method Gain on disposal of investments accounted for using equity method held for sale Impairment loss on non-financial assets Others Changes in operating assets and liabilities Contract assets Notes and accounts receivable Notes and accounts receivable due from related parties Other receivables Inventories Prepayments Other current assets Other financial assets Incremental costs of obtaining a contract Contract liabilities Notes and accounts payable Notes and accounts payable due to related parties Other payables Provisions Advance receipts Other current liabilities Net defined benefit liabilities Cash inflows generated from operating activities Interest received Interest paid Income taxes paid Net cash generated from operating activities	2022 $ 16,191,242 12,711,921 4,775,736 1,322,091 214,387 (1,014) 258,214 (473,168) 737,134 (110,440) (20,041) (2,377) (10,145) - (109,805) 82,231 2,464 (628,820) (673,591) (193,686) (654,719) (1,661,224) (139,885) (11,995) (3,246) (1,407,459) 193,536 2,229,258 (205,410) (55,317) (4,387) 98,628 291,255 (30,726) 32,710,642 13,729 (933) (3,146,887) 29,576,551	2021 $ 15,581,575 12,286,609 4,780,516 1,409,231 (8,690) - 224,659 (222,947) 627,813 (56,370) (18,864) 2,869 19,681 (97,791) - - (2,432) (1,509,745) (443,784) (175,576) (800,453) (673,852) 13,332 (22,608) 8,409 (1,465,734) (11,208) 1,992,485 178,004 871,255 (104,264) (24,767) 121,868 (34,923) 32,444,298 13,132 (910) (2,260,978) 30,195,542

(Continued)

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of property, plant and equipment Acquisition of right-of-use assets Acquisition of intangible assets Increase in prepayments for equipment Proceeds from disposal of property, plant and equipment Proceeds from disposal of property, plant and equipment held for sale Increase in advance receipts from asset disposals Proceeds from disposal of intangible assets Acquisition of financial assets at fair value through profit or loss Acquisition of financial assets at fair value through other comprehensive income Transfer of financial assets at fair value through other comprehensive income Disposal of financial assets at fair value through other comprehensive income Acquisition of investments accounted for using equity method Disposal of investments accounted for using equity method Disposal of investments accounted for using equity method held for sale Proceeds from capital return of investments accounted for using equity method Other investing activities Increase in refundable deposits Decrease in refundable deposits Increase in other financial assets Decrease in other financial assets Interest received Received dividends from associate Other dividends received Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term borrowings Decrease in short-term notes and bills payable Proceeds from issue of bonds Repayments of bonds Proceeds from long-term borrowings Repayment of long-term borrowings Repayment of the principal portion of lease liabilities Increase in guarantee deposits received Decrease in guarantee deposits received Cash dividends paid (including paid to non-controlling interests)	2022 $ (9,839,436) (26,018) (286,447) (335,919) 9,328 2,715 231 10,000 (904,871) (1,911,815) 671,375 2,138 (308,658) 667 200,156 112,302 829,052 (382,773) 278,347 (418,192) 427,239 91,763 125,493 21,570 (11,631,753) 40,000 (1,508,125) - - 4,499,798 (3,276,712) (4,106,225) 216,703 (149,954) (13,429,860)	2021 $ (10,433,984) (30,965) (294,725) (441,397) 175,694 - 283 12,800 (276,636) (588,407) - - (424,767) 474,377 - - 2,152,807 (322,609) 263,500 (69,286) 69,587 38,525 39,369 17,337 (9,638,497) 10,710,000 (9,591,635) 2,496,465 (10,700) - (2,261,757) (3,994,354) 227,563 (126,475) (12,869,217) (Continued)

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TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

Interest paid Increase in non-controlling interests Net cash used in financing activities EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT END OF THE YEAR	2022 $ (693,109) (5,880) (18,413,364) 1,281 (467,285) 15,402,025 $ 14,934,740	2021 $ (591,054) 79,150 (15,932,014) (797) 4,624,234 10,777,791 $ 15,402,025

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

(Concluded)

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

1. ORGANIZATION AND OPERATIONS

Taiwan Mobile Co., Ltd. (TWM) was incorporated in Taiwan, the Republic of China (ROC) on February 25, 1997. TWM’s stock was listed on the ROC Over-the-Counter Securities Exchange (currently known as The Taipei Exchange, TPEx) on September 19, 2000. On August 26, 2002, TWM’s stock was shifted to be listed on the Taiwan Stock Exchange. TWM is mainly engaged in rendering wireless communication services and the sale of mobile phones and accessories, games, e-books and value-added services.

TWM received a second-generation mobile telecommunications concession operation license issued by the Directorate General of Telecommunications (DGT) of the ROC. The license allows TWM to provide services for 15 years from 1997 onwards. The 2G concession license had been renewed by the National Communications Commission (NCC) and expired on June 30, 2017. TWM received a third-generation concession license issued by the DGT in March 2005, and the 3G concession license expired on December 31, 2018. TWM participated in the mobile spectrum auctions held by NCC for the need of long-term business development and from April 2014 to June 2018 acquired the concession licenses for the fourth-generation mobile broadband spectrum in the 700MHz, 1800MHz and 2100MHz frequency bands separately, and the aforementioned licenses are valid until December 2030 and December 2033, respectively. In June 2020, TWM acquired the concession licenses for the fifth-generation mobile broadband spectrum in the 3500MHz and 28000MHz frequency bands, and the aforementioned licenses are valid until December 2040.

The accompanying consolidated financial statements comprise of TWM and its subsidiaries (collectively, the “Group”).

2. APPROVAL OF THE CONSOLIDATED FINANCIAL STATEMENTS

The Board of Directors approved the consolidated financial statements on February 24, 2023.

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

a. Application of the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC)

Application of the IFRSs endorsed and issued into effect by the FSC did not have any material impact on the Group’s accounting policies.

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b. The IFRSs issued by International Accounting Standards Board (IASB) and endorsed by the FSC for application starting from 2023

Effective Date New IFRSs Announced by IASB

Amendments to IAS 1 “Disclosure of Accounting Policies” January 1, 2023 (Note 1) Amendments to IAS 8 “Definition of Accounting Estimates” January 1, 2023 (Note 2) Amendments to IAS 12 “Deferred Tax related to Assets and January 1, 2023 (Note 3) Liabilities arising from a Single Transaction”

Note 1: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.
Note 2: The amendments are applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.
Note 3: Except that deferred taxes will be recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments were applied prospectively to transactions that occur on or after January 1, 2022.

As of the date the consolidated financial statements were authorized for issue, the Group had assessed that the application of above standards and interpretations would not have a material impact on the Group’s financial position and financial performance.

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

New IFRSs Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between An Investor and Its Associate or Joint Venture” Amendments to IFRS 16 “Leases Liability in a Sale and Leaseback” Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” Amendments to IAS 1 “Non-current Liabilities with Covenants”	Effective Date Announced by IASB (Note 1)
	To be determined by IASB January 1, 2024 (Note 2) January 1, 2024 January 1, 2024

Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.
Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and leaseback transactions entered into after the date of initial application of IFRS 16.

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

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Statement of Compliance

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

Basis of Preparation

a. Basis of measurement

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

b. Functional and presentation currency

The functional currency of each individual consolidated entity is determined based on the primary economic environment in which the entity operates. The Group’s consolidated financial statements are presented in New Taiwan dollars (NTD), which is TWM’s functional currency.

Basis of Consolidation

a. Principles for preparation of the consolidated financial statements

The consolidated financial statements incorporate the financial statements of TWM and its controlled entities (the subsidiaries).

Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statements of comprehensive income from the effective dates of acquisitions or to the effective dates of disposals, as appropriate. The comprehensive income from subsidiaries is allocated to TWM and its non-controlling interests, even if the non-controlling interests have a deficit balance.

Changes in the ownership of a subsidiary that do not result in loss of control are accounted for as equity transactions. The carrying amounts of the interests of the Group and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to the owners of TWM.

When the Group loses control of a subsidiary, a gain or loss is recognized in profit or loss and is calculated as the difference between:

1) The aggregate of the fair value of consideration received and the fair value of any retained interest at the date when control is lost; and
2) The previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interest.

The Group shall account for all amounts recognized in other comprehensive income in relation to the subsidiary on the same basis as would be required if the Group had directly disposed of the related assets and liabilities.

The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the cost on initial recognition of an investment in an associate.

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Financial statements of subsidiaries are adequately adjusted to align their accounting policies with those of the Group.

Transactions and balances, and any income and expenses arising from intra-group transactions were eliminated during the preparation of the consolidated financial statements.

b. The subsidiaries included in the consolidated financial statements were as follows:

Investor
Subsidiary
Main Business and Products
TWM
Taiwan Cellular Co., Ltd. (TCC)
Investment
Wealth Media Technology Co., Ltd.
(WMT)
Investment
TWM Venture Co., Ltd. (TVC)
Investment
Taipei New Horizon Co., Ltd.
(TNH)
Building and operating Songshan
Cultural and Creative Park BOT
project
Fu Sheng Digital Co., Ltd. (FSD) Information services
TCC
Taiwan Fixed Network Co., Ltd.
(TFN)
Fixed-line service provider
Taiwan Teleservices &
Technologies Co., Ltd. (TT&T)
Call center service and telephone
marketing
TWM Holding Co., Ltd. (TWM
Holding)
Investment
TCC Investment Co., Ltd. (TCCI)
Investment
Taiwan Digital Service Co., Ltd.
(TDS)
Commissioned maintenance services
Taihsin Property Insurance Agent
Co., Ltd. (TPIA)
Property insurance agent
Tai-Fu Cloud Technology Co., Ltd.
(TFC)
Cloud and information services
WMT
TFN Media Co., Ltd. (TFNM)
Type II telecommunications
business
Global Forest Media Technology
Co., Ltd. (GFMT)
Investment
Global Wealth Media Technology
Co., Ltd. (GWMT)
Investment
Win TV Broadcasting Co., Ltd.
(WTVB)
TV program provider
momo.com Inc. (momo)
Wholesale and retail sales
TVC
Taiwan Mobile Film Co., Ltd.
(TWMFM)
Film production
TFN
TFN Union Investment Co., Ltd.
(TUI)
Investment
TWM Holding
TWM Communications (Beijing)
Co., Ltd. (TWMC)
Data communication application
development
TCCI
TCCI Investment and Development
Co., Ltd. (TID)
Investment
TWMFM
Taiwan Stampede Franchise Film
Co., Ltd. (SFF)
Film production
TFNM
Taiwan Kuro Times Co., Ltd.
(TKT)
Digital music services
Yeong Jia Leh Cable TV Co., Ltd.
(YJCTV)
Cable TV service provider
Mangrove Cable TV Co., Ltd.
(MCTV)
Cable TV service provider
Phoenix Cable TV Co., Ltd.
(PCTV)
Cable TV service provider
Union Cable TV Co., Ltd. (UCTV) Cable TV service provider
Globalview Cable TV Co., Ltd.
(GCTV)
Cable TV service provider
GFMT
UCTV
Cable TV service provider
GWMT
GCTV
Cable TV service provider
momo
Asian Crown International Co., Ltd.
(Asian Crown (BVI))
Investment
Honest Development Co., Ltd.
(Honest Development)
Investment
Fuli Life Insurance Agent Co., Ltd.
(FLI)
Life insurance agent

Percentage of Ownership
December 31
2022
2021
Note
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
49.90%
49.90%
-
100.00%
-
Note 1
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
Note 2
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
45.01%
45.01%
-
100.00%
100.00%
-
100.00%
100.00%
Note 2
100.00%
100.00%
-
100.00%
100.00%
Note 2
100.00%
-
Note 3
100.00%
100.00%
-
100.00%
100.00%
-
29.53%
29.53%
Note 4
100.00%
100.00%
-
99.22%
99.22%
-
92.38%
92.38%
-
0.76%
0.76%
-
6.83%
6.83%
-
81.99%
81.99%
-
100.00%
100.00%
-
100.00%
100.00%
-
(Continued)

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Investor
Subsidiary
Main Business and Products
momo
Fuli Property Insurance Agent Co.,
Ltd. (FPI)
Property insurance agent
Fu Sheng Travel Service Co., Ltd.
(FST)
Travel agent
Bebe Poshe International Co., Ltd.
(Bebe Poshe)
Wholesale of cosmetics
Fu Sheng Logistics Co., Ltd. (FSL) Logistics and transport
MFS Co., Ltd. (MFS)
Wholesaling
Prosperous Living Co., Ltd.
(Prosperous Living)
Wholesale and retail sales
Asian Crown
(BVI)
Fortune Kingdom Corporation
(Fortune Kingdom)
Investment
Fortune Kingdom Hong Kong Fubon Multimedia
Technology Co., Ltd. (HK Fubon
Multimedia)
Investment
Honest
Development
Hongkong Yue Numerous
Investment Co., Ltd. (HK Yue
Numerous)
Investment
HK Yue
Numerous
Haobo Information Consulting
(Shenzhen) Co., Ltd. (Haobo)
Investment
HK Fubon
Multimedia
Fubon Gehua (Beijing) Enterprise
Ltd. (FGE)
Wholesaling

Percentage of Ownership
December 31
2022
2021
Note
100.00%
100.00%
Note 5
100.00%
100.00%
-
88.68%
85.00%
Note 6
100.00%
100.00%
-
100.00%
100.00%
-
73.62%
73.62%
Note 7
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
100.00%
100.00%
-
93.55%
93.55%
-
(Concluded)

Note 1: In September 2022, FSD was set up as a preparatory office, and the incorporation registration was completed on October 7, 2022.
Note 2: TCCI, TUI and TID collectively owned 698,752 thousand shares of TWM, representing 19.86% of total outstanding shares as of December 31, 2022.
Note 3: Became a subsidiary in June 2022.
Note 4: The other 70.47% of shares were held under trustee accounts.
Note 5: Renamed as Fuli Insurance Agent Co., Ltd. in February 2023, and changed its main business to comprehensive insurance agent.
Note 6: In October 2022, momo bought back minority interest of Bebe Poshe, resulting in the increase in its ownership.
Note 7: Owned 73.62% equity interest in November 2021.
c. Subsidiaries excluded from the consolidated financial statements: None.

Foreign Currencies

Foreign currency transactions are recorded at the spot exchange rate on the date of the transaction. At the end of the reporting period, foreign currency monetary items are reported using the closing rate. Exchange differences in the period 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 fair value was determined. Exchange differences arising from the retranslation of non-monetary items are included in profit or loss for the period except for exchange differences arising from the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income; in which cases, the exchange differences are also recognized directly in other comprehensive income.

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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.

When preparing the consolidated financial statements, the assets and liabilities of foreign operations are translated to NTD using the exchange rates at the end of the reporting period. The income and expenses of foreign operations are translated at the average exchange rate for the period. Exchange differences are recognized in other comprehensive income and accumulated in equity attributed to the owners of TWM and non-controlling interests as appropriate.

On the disposal of the Group’s entire interest in a foreign operation, all of the exchange differences accumulated in equity in respect of that operation are reclassified to profit or loss.

Classification of Current and Non-current Assets and Liabilities

The Group classifies an asset as current when any one of the following requirements is met. Assets that are not classified as current are non-current assets.

a. It holds the asset primarily for the purpose of trading;
b. It expects to realize the asset within twelve months after the reporting period; or
c. The asset is cash or a cash equivalent unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

The Group classifies a liability as current when any one of the following requirements is met. Liabilities that are not classified as current are non-current liabilities.

a. It holds the liability primarily for the purpose of trading;
b. The liability is due to be settled within twelve months after the reporting period; or
c. It does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

Financial Instruments

Financial assets and financial liabilities are recognized in the consolidated balance sheets when the Group becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at FVTPL) 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 FVTPL are recognized immediately in profit or loss.

a. Financial assets

The Group adopts trade-date accounting to recognize and derecognize financial assets.

1) Measurement category

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

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a) Financial assets at FVTPL

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

Financial assets at FVTPL are subsequently measured at fair value, and any dividends and interest earned on such financial assets are recognized in other income and interest income, respectively; any remeasurement gains or losses on such financial assets are recognized in other gains or losses.

b) Financial assets at amortized cost

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

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

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, notes and accounts receivable, other receivables, other financial assets, refundable deposits, etc., are measured at amortized cost, which equal to gross carrying amount determined by the effective interest method less any impairment loss, except for short-term receivables when the recognition of interest is immaterial. Exchange differences are recognized in profit or loss.

Interest income is calculated by applying the effective interest rate to the amortized cost of the financial asset.

Cash equivalents include time deposits with original maturities within 3 months from the date of acquisition, which are highly liquid, readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. These cash equivalents are held for the purpose of meeting short-term cash commitments. If they do not meet the above definition, time deposits should be recognized as other current or non-current financial assets.

c) Investments in equity instruments at FVTOCI

On initial recognition, the Group may make an irrevocable election to designate investments in equity instruments as at 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.

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

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2) Impairment of financial assets and contract assets

The Group recognizes a loss allowance for expected credit losses (ECLs) on financial assets at amortized cost (including receivables) and contract assets.

The loss allowances for receivables and contract assets are measured at an amount equal to lifetime ECLs. For other financial assets, when the credit risk on the financial instrument has not increased significantly since initial recognition, a loss allowance is recognized at an amount equal to 12-month ECLs. If, on the other hand, there has been a significant increase in credit risk since initial recognition, a loss allowance is recognized at an amount equal to lifetime ECLs.

ECLs reflect the weighted average of credit losses with the respective risks of a 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 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 purposes, the Group determines that the following situations indicate that a financial asset is in default (without taking into account any collateral held by the Group):

a) Internal or external information shows that the debtor is unlikely to pay its creditors.
b) Failure to meet the obligation associated with liabilities within the credit terms.

The Group recognizes an impairment loss in profit or loss for aforementioned financial instruments and contract assets with a corresponding adjustment to their carrying amount through a loss allowance account.

3) Derecognition of financial assets

The Group derecognizes financial assets only when the contractual rights of 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 investments in equity instruments at FVTOCI, the cumulative gain or loss is directly transferred to retained earnings, and is not reclassified to profit or loss.

b. Equity instruments

Equity instruments issued by the Group are recognized at the proceeds received, net of direct issue costs.

The repurchase of the Company’s own equity instruments is recognized in and deducted directly from equity. No gain or loss is recognized in profit or loss on the purchase, sale, issue or cancellation of the Company’s own equity instruments.

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c. Financial liabilities

1) Recognition

Except for the financial liabilities measured at FVTPL, all financial liabilities, including loans and borrowings, commercial papers payable, bonds payable, notes and accounts payable, other payables, guarantee deposits received, etc., are measured at amortized cost calculated using the effective interest method.

2) Convertible bonds

The component parts of compound financial instruments (convertible bonds) issued by the Company are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

On initial recognition, the fair value of the liability component is estimated at the prevailing market interest rate for similar non-convertible instruments. The amount is recognized as a liability on an amortized cost basis using the effective interest method until extinguished upon conversion or the instrument’s maturity date. Any embedded derivative liability is measured at fair value.

The conversion option classified as equity is determined by deducting the amount of the liability component from the fair value of the compound instrument as a whole. This is recognized and included in equity, and is not subsequently remeasured. In addition, the conversion option classified as equity will remain in equity until the conversion option is exercised, in which case, the balance recognized in equity will be reclassified as capital surplus - additional paid-in capital. If the conversion option remains unexercised at maturity, the balance recognized in equity will be reclassified as capital surplus - expired share options.

Transaction costs that relate to the issuance of the convertible bonds are allocated to the liability and equity components in proportion to the allocation of the gross proceeds. Transaction costs relating to the equity component are recognized directly in equity. Transaction costs relating to the liability component are included in the carrying amount of the liability component.

3) 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.

d. Derivative financial instruments

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.

Derivatives embedded in hybrid contracts that contain financial asset hosts within the scope of IFRS 9 are not separated; instead, the classification is determined in accordance with the entire hybrid contract. Derivatives embedded in non-derivative host contracts that are not financial assets within the scope of IFRS 9 (e.g., financial liabilities) are treated as separate derivatives when they meet the definition of a derivative; their risks and characteristics are not closely related to those of the host contracts; and the host contracts are not measured at FVTPL.

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Inventories

Inventories are measured at the lower of cost or net realizable value. Inventories are assessed item by item, except those with similar characteristics which are assessed collectively. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs or selling expenses. The weighted-average method is used in the calculation of cost.

Non-current Assets Held for Sale

The book value of non-current assets classified as held for sale is expected to be recovered primarily through sale. Being classified as held for sale, the assets should be available for immediate sale. Being available for immediate sale means the management is committed to a planned sale and the sale is highly probable within 12 months.

When the Group is committed to a sale plan involving the disposal of an investment or a portion of an investment in an associate, the investment or the portion of the investment that will be disposed of is classified as held for sale when the classification criteria are met, and the Group discontinues the use of the equity method in relation to the portion that is classified as held for sale.

Assets classified as non-current assets held for sale are measured at the lower of the carrying amount and fair value less costs to sell, and should not be depreciated.

Investment in Associates

An associate is an entity in which the Group has significant influence, but is neither a subsidiary nor an interest in a joint venture. The Group applies the equity method to account for its investments in associates.

Investments in associates are accounted for using equity method and are recognized initially at cost. The cost of the investment includes transaction costs. The carrying amount of the investment in associates includes goodwill arising from the acquisition less any accumulated impairment losses. Goodwill is not amortized. Any excess of the Group’s share of the net fair value of the identifiable assets and liabilities over the cost of acquisition, is recognized immediately in profit or loss after reassessment. The entire carrying amount of an investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is not allocated to any asset, including goodwill, which 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 consolidated financial statements include the Group’s share of the profit or loss and other comprehensive income (loss) of equity-accounted investees, after adjustments to align their accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases.

When the Group’s share of losses of an associate equals or exceeds its interest in that associate, the Group discontinues recognizing its share of further losses. Additional losses and liabilities are recognized only to the extent that the Group has incurred legal obligations, or constructive obligations, or made payments on behalf of that associate.

When the Group 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 Group’s proportionate interest in the associate. The Group records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus - changes in capital surplus from investments in associates accounted for using the equity method. If the Group’s ownership interest is reduced due to its disproportionate 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 had the

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investee directly disposed of the related assets or liabilities. When the adjustment should be debited to capital surplus, but the capital surplus recognized from investments accounted for using the equity method is insufficient, the shortage is debited to retained earnings.

When the Group loses significant influence over an associate, it recognizes the investment retained in the former associate at its fair value at the date when significant influence is lost. The difference between the fair value of the investment plus consideration received and the carrying amount of the previous investment at the date when significant influence is lost is recognized as a gain or loss in profit or loss. Besides this, the Group accounts for all amounts previously recognized in other comprehensive income in relation to that associate on the same basis as would be required if the Group had directly disposed of the related assets or liabilities.

If the Group decreased the percentage of the ownership of associate due to disposal but still accounts for its investments in associate, it should reclassify the amount previously recognized in other comprehensive income to profit or loss proportionally.

When the Group transacts with its associates, profits and losses resulting from the transactions with the associates are recognized in the Group’s consolidated financial statements only to the extent that interests in the associates are not related to the Group.

Property, Plant and Equipment

Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditure that is directly attributed to the acquisition of the asset, the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, and any borrowing cost that is eligible for capitalization.

Properties, plant and equipment in the course of construction are carried at cost, less any recognized impairment loss. The costs include professional service fee. Such assets are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for intended use.

Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item shall be depreciated with a separate depreciation rate or depreciation method.

The depreciable amount of an asset is determined after deducting its residual amount, and the net amount shall be allocated by the straight-line method over its useful life. Each significant item of property, plant and equipment shall be evaluated and depreciated separately if it possesses a different useful life. The depreciation charge for each period shall be recognized in profit or loss.

Land has an unlimited useful life and therefore is not depreciated. For the estimated useful lives, for the current and comparative years, of significant items of property, plant and equipment, see Note 12 to the consolidated financial statements for details.

Depreciation methods, useful lives, and residual values are reviewed at the end of each reporting period. If expectations differ from the previous estimates, the change is accounted for as a change in accounting estimate.

Property, plant and equipment are derecognized when disposed of or expected to have no future economic benefits generated through usage or disposal. The gain or loss arising from the derecognition of an item of property, plant and equipment shall be determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item, and it shall be recognized in profit and loss.

Subsequent expenditure is capitalized only when it is probable that the future economic benefits associated with the expenditure will flow to the Group and the amount can be reliably measured. The carrying amount of those parts that are replaced is derecognized. Ongoing repairs and maintenance are expensed as incurred.

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Leases

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

a. The Group as lessor

Leases in which the lessee assumes substantially all of the risks and rewards of ownership are classified as finance leases. All other leases are classified as operating leases.

When the Group subleases a right-of-use asset, the sublease is classified by reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset.

Under finance leases, the lease payments comprise fixed payments and in-substance fixed payments. The net investment in a lease is measured at the present value of the sum of the lease payments receivable by a lessor and is presented as a finance lease receivable. Finance lease income is allocated to the relevant accounting periods so as to reflect a constant, periodic rate of return on the Group’s net investment outstanding in respect of leases.

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

When a lease includes both land and building elements, the Group assesses the classification of each element separately as a finance or an operating lease based on the assessment as to whether substantially all the risks and rewards incidental to ownership of each element have been transferred to the lessee. The entire lease is classified as an operating lease when it is clear that both elements are operating leases.

b. The Group as lessee

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

Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease liabilities adjusted for lease payments made at or before the commencement date. Right-of-use assets are subsequently measured at cost less accumulated depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities. Right-of-use assets are presented on a separate line in the consolidated balance sheets.

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

Lease liabilities are initially measured at the present value of the lease payments, which comprise fixed payments, in-substance fixed payments and variable lease payments which depend on an index. The lease payments are discounted using 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 a lease term or a change in future lease payments resulting from a change in an index used to determine those payments, the Group remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. For a lease modification, the Group accounts for the remeasurement of the lease liability by (a) adjusting the carrying amount of the right-of-use asset of lease modifications that adjust the scope and the term of the lease, and recognizes in profit or loss any gain or loss on the partial or full termination of the lease and (b) making a corresponding adjustment to

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the right-of-use asset of all other lease modifications. The Group also accounts for the rent concessions as lease modifications if the rent payments due by June 30, 2022 were adjusted due to the COVID-19 pandemic. Lease liabilities are presented on a separate line in the consolidated balance sheets.

Variable lease payments that do not depend on an index are recognized as expenses in the periods in which they are incurred.

Investment Properties

Investment properties are properties held to earn rental and/or for capital appreciation. Investment properties are measured at cost on initial recognition. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and accumulated impairment loss. Depreciation methods, useful lives, and residual values are the same as plant, property and equipment.

Intangible Assets

a. Goodwill

Goodwill acquired in a business combination is recognized at the acquisition date, and is measured at cost less accumulated impairment losses.

b. Service concession agreement

The operator recognizes the right to charge users for a service as an intangible asset. The operator measures the intangible asset at fair value.

c. Other intangible assets

Other intangible assets that are acquired through business combinations or are internally developed are measured at cost less accumulated amortization and any accumulated impairment losses. Intangible assets that are acquired through business combinations are measured at acquisition-date fair value, and recognized along with goodwill.

d. Amortization and derecognition of intangible assets

Amortization is recognized in profit or loss on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill and intangible assets with an indefinite useful life, from the date that they are available for use. For the estimated useful lives of intangible assets for the current and comparative periods, see Note 15 to the consolidated financial statements.

The amortization method, the amortization period, and the residual value for an intangible asset with a finite useful life shall be reviewed at each fiscal year-end. Any changes shall be accounted for as changes in accounting estimates.

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.

Incremental Costs of Obtaining a Contract

Only when a contract is obtained, sales commissions and subsidies of telecommunication, cable television and broadband services are recognized as incremental costs of obtaining a contract to the extent the amounts are expected to be recovered, and are amortized on a straight-line basis over the life of the contract. However, the Group elects not to capitalize the incremental costs of obtaining a contract if the amortization period of the assets that the Group otherwise would have recognized is expected to be one year or less.

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Impairment of Non-financial Assets

a. Goodwill

Impairment of goodwill is required to be tested annually or more frequently whenever there is an indication that the unit may be impaired. Goodwill shall be allocated to each of the acquirer’s cash-generating units, or groups of cash-generating units, that are expected to benefit from the synergies of the combination. If the recoverable amount of the cash-generating unit is less than its carrying amount, the difference is allocated first to reduce the carrying amount of any goodwill allocated to such cash generating unit and then to the other assets of the cash generating unit pro rata based on the carrying amount of each asset in the cash generating unit. Any impairment loss for goodwill is recognized directly in profit or loss. Any impairment loss recognized for goodwill is not reversed in subsequent periods.

b. Property, plant, and equipment, right-of-use assets, investment properties, intangible assets (excluding goodwill), and incremental costs of obtaining a contract

At the end of each reporting period, the Group reviews the carrying amounts of those 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 Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate.

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. An impairment loss is recognized immediately in profit or loss. When an impairment loss subsequently reverses, the carrying amount of the asset or a cash-generating unit is increased to the revised estimate of its recoverable amount, but the increased carrying amount does not exceed 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 immediately in profit or loss.

Provisions

A provision is recognized if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows that reflects the current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as a finance cost.

a. Restoration

The restoration costs for telecommunications equipment and leasehold improvements that were originally acquired or used by the Group for a period of time and had obligations for dismantling, relocating, and restoring to the previous state should be recognized as an addition to the assets and accrued as a potential liability accordingly.

b. Replacement

For a service concession agreement, the costs paid for the obligation for maintenance or replacement should be recognized as expenses and liabilities before returning the construction to the grantor.

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c. Warranties

A provision for warranties is recognized when the underlying products or services are sold. The provision is based on sales contracts, historical warranty data, and a weighing of all possible outcomes against their associated probabilities.

Treasury Stock

Repurchased stocks are recognized under treasury stock (a contra-equity account) based on their repurchase price (including all directly accountable costs), net of tax. TWM’s stocks held by its subsidiaries are regarded as treasury stock.

Gains on disposal of treasury stock should be recognized under “capital reserve - treasury stock transactions”; losses on disposal of treasury stock should be offset against existing capital reserves arising from similar types of treasury stock. If there is insufficient capital reserve to offset the losses, then such losses should be accounted for under retained earnings. The carrying amount of treasury stock should be calculated using the weighted-average method for the purpose of repurchased stock.

Government Grants

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

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

Government grants that are receivable as compensation for expenses or losses already incurred are recognized in profit or loss in the period in which they become receivable.

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.

Obligations for contributions to defined contribution pension plans are recognized as an expense in profit or loss in the periods during which services are rendered by employees.

The defined benefit costs (including service cost, net interest, and remeasurement) of defined benefit plan use the projected unit credit method for the actuarial valuation. Service cost (including current service cost and past service cost) and net interest on the net defined benefit liability (asset) are recognized under employee benefit expense as they occur. Remeasurement (including actuarial gains and losses and the return on plan assets, excluding amounts included in net interest) is recognized in other comprehensive income (loss) in retained earnings as it occurs, and is not reclassified to profit or loss subsequently.

Net defined benefit liability (asset) represents the deficit (surplus) of defined benefit plans. IAS 19 requires the Group to limit the carrying amount of a net defined benefit asset so that it does not exceed the economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan.

A liability for a termination benefit is recognized at the earlier of when the Group can no longer withdraw the offer of the termination benefit and when the Group recognizes any related restructuring costs.

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Income Tax

Income tax expense represents the sum of the tax currently payable and deferred tax. Except for expenses related to business combinations, expenses directly recognized in equity or other comprehensive income (loss), and other related expenses, all current and deferred taxes shall be recognized in profit or loss.

a. Current taxes

Current taxes include tax payables and tax deduction receivables on taxable gains (losses), as well as tax adjustments related to prior years.

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

An additional surtax on undistributed earnings, computed in accordance with the Income Tax Act of the ROC, is recognized in current taxes in the year of approval by a stockholders’ meeting resolution.

b. Deferred taxes

Deferred taxes arise due to temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax basis. Deferred tax assets are generally recognized for all deductible temporary differences, unused loss carryforwards and unused tax credits for purchases of machinery, equipment and technology, and research and development expenditures to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized. Deferred tax liabilities are generally recognized for all taxable temporary differences.

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

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the 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 assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the end of the reporting period. The measurement reflects the Group’s expectations at the end of the reporting period as to the manner in which the carrying amount of its assets and liabilities will be recovered or settled.

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Revenue Recognition

Where the Group enters into transactions which involve both the provision of telecommunications service bundled with products such as handsets, total consideration received from products and telecommunications service in these arrangements is allocated based on their relative stand-alone selling price. The amount of sales revenue recognized for products is not limited to the amount paid by the customer for the products at the time of purchase. When the amount of sales revenue recognized for products exceeds the amount paid by the customer for the products, the difference is recognized as a contract asset. A contract asset is derecognized and an account receivable is recognized when the amount becomes collectible from the customer subsequently. When the amount of sales revenue recognized for products is less than the amount paid by the customer for the products, the difference is recognized as contract liabilities and the revenue is recognized subsequently when the telecommunications service is provided.

Under customer loyalty program, the Group offers reward points or vouchers for customers. Transaction price allocated is recognized as contract liabilities or other financial liabilities when collected and will be deducted when points or vouchers are redeemed. Reward points and vouchers will be recognized as revenue when they are redeemed or have expired.

Telecommunications and value-added services revenue

Service revenues from mobile communication services, fixed network services and internet services, are billed at predetermined rates and calculated based on the actual volume of voice call and data transfer. Revenues from postpaid users are accrued monthly. Revenues from prepaid users are recognized based on the actual usage. The advanced receipts obtained before services are rendered are recognized as contract liabilities and reclassified as revenues when services are rendered. Interconnection and call transfer fees from other telecommunications companies and carriers are billed and recognized based upon seconds or minutes of traffic processed when the services are provided in accordance with contract terms. The usage revenues and corresponding trade notes and accounts receivable are recognized monthly.

Revenue from sale of goods

Revenues from sale of goods are mainly generated from physical stores, e-commerce platform, television channels and catalog. Revenues are recognized when the goods are transferred or delivered to the customers. Advance receipts obtained before goods are transferred or delivered are recognized as contract liabilities, and reclassified as revenue when the goods are transferred or delivered. When rights of return exist, refund liability and right to recover a product are accrued based on past experience and other relevant factors.

Cable television and broadband services revenue

The Group recognizes advance receipts as contract liabilities initially, with prepayment period of annually, semi-annually, quarterly or monthly, which is reclassified as cable television and broadband service revenue as service becomes rendered, and do not include significant financing component. The Group provides contractual services such as the right of access to cable channels and internet over the duration of the contract, and recognizes revenue over the duration of the contract through the straight-line method.

Other operating income

The Group recognizes advance receipts obtained before contracts are initiated as contract liabilities, and contract liabilities are transferred into revenue after the completion of usage or over the term of the relevant lease. Short-term lease revenues are recognized after the completion of usage. Long-term lease revenues are recognized over the term of the relevant lease through the straight-line method, and do not include significant financing component.

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Service revenues generated from contractual agreements are recognized as revenue as services are rendered based on the completion of the contracts and the Group does not have any further obligations. In addition, when the Group is acting as an agent in the transaction, proportional revenue is recognized based on the net amount in accordance with the contractual agreements proportionally.

Advertising revenues are recognized as services are rendered over the contract terms.

Business Combinations

Business combinations are accounted for by the acquisition method. Acquisition-related costs are recognized in profit or loss as they are incurred.

Goodwill is measured as an aggregation of the consideration transferred at the acquisition date, and the amount of any non-controlling interest in the acquiree, net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed at fair value. If the residual balance is negative, the Group shall re-assess whether it has correctly identified all of the assets acquired and liabilities assumed, and recognize a gain on the bargain purchase thereafter.

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

The preparation of the consolidated financial statements requires management to make judgments, estimates and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates.

The management will continually review the estimates and basic assumptions. The impact of changes in accounting estimates will be recognized in the period of change and the future period impacted.

Critical Accounting Judgments

a. Lease terms

In determining a lease term, the Group considers all facts and circumstances that create an economic incentive to exercise or not to exercise an option, including any expected changes in facts and circumstances from the commencement date until the exercise date of the option. Main factors considered include contractual terms and conditions for the optional periods, significant leasehold improvements undertaken over the contract term, the importance of the underlying asset to the lessee’s operations, etc. The lease term is reassessed if a significant change in circumstances that are within control of the Group occurs.

b. Timing of revenue recognition

The Group recognizes revenue when the performance obligations are satisfied over time or at a point in time according to the contracts with customers. The conditions are described in Note 4.

c. Principal versus agent

For contracts with customers relating to the sale of goods and providing service, the Group recognizes revenue on a net basis when it satisfies its performance obligations after taking other indicators into consideration such as not being primarily responsible, and before passing the goods and service on to customers. The Group recognizes revenue on a gross basis when it satisfies its performance obligations if the transfer of the goods and service satisfies other indicators such as its being primarily responsible.

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Key Sources of Estimation Uncertainty

a. Impairment of notes and accounts receivable and contract assets

The provision for impairment of notes and accounts receivable and contract assets is based on assumptions about risk of default and expected loss rates. The Group uses judgment in making these assumptions and in selecting the inputs to the impairment calculation, based on the past default records of the customers and an analysis of the customers’ current financial positions, as well as forward-looking indicators. For details of the key assumptions and inputs used, see Note 8.

b. Provision for inventory valuation and obsolescence

c. Impairment of goodwill

The usage value of the cash-generating units to which goodwill is allocated should be predetermined when assessing whether the goodwill is impaired. Management estimates the future cash flows from cash-generating units and assigns an appropriate discount rate in calculating the present value. Significant impairment loss may occur if actual cash flows are less than that originally forecasted.

d. Impairment of property, plant, and equipment, right-of-use assets, investment properties, intangible assets (excluding goodwill), and incremental costs of obtaining a contract

In the process of impairment assessments, the Group relies on subjective judgment to determine the individual cash flows of a specific group of assets and estimates future gains and losses according to the usage of the assets and relevant business characteristics. Alterations of estimates from any changes in economic conditions or business strategy may lead to significant impairment losses in the future.

6. CASH AND CASH EQUIVALENTS

Cash on hand and revolving funds Cash in banks Time deposits Government bonds with repurchase rights		December 31	December 31
		2022 $ 84,603 5,783,016 6,718,115 2,349,006 $ 14,934,740	2021 $ 115,796 9,792,564 3,358,087 2,135,578 $ 15,402,025

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7. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Investments in equity instruments-current Domestic investments Listed stocks Foreign investments Unlisted stocks Investments in equity instruments-non-current Domestic investments Listed stocks Unlisted stocks Foreign investments Unlisted stocks Limited partnerships		December 31	December 31
		2022 $ 245,607 4,217 $ 249,824 $ 260,000 1,224,455 2,092,100 1,210,288 $ 4,786,843	2021 $ 253,214 15,179 $ 268,393 $ 1,458,745 608,146 946,097 689,647 $ 3,702,635

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 fair value through other comprehensive income (FVTOCI) as they believed that recognizing short-term fluctuations from these investments’ fair value in profit or loss would not be consistent with the Group’s strategy of holding these investments for long-term purposes.

Regarding to the merger between Far EasTone Telecommunications Co., Ltd. (FET) and Asia Pacific Telecom Co., Ltd. (APT), TWM exercised the dissenting shareholder’s appraisal right to request APT to buy back TWM’s shares in accordance with the Business Mergers And Acquisitions Act, and had deposited all of the held shares to APT in the second quarter of 2022. The related valuation of loss of $2,308,625 thousand was transferred from other equity to retained earnings. In July 2022, APT had paid the fair price it has recognized of $671,375 thousand to TWM in accordance with the Business Mergers And Acquisitions Act. However, TWM disagreed with such the fair price recognized by APT, and therefore, APT applied to the court for a ruling on the fair price. The case is now progressing at the Intellectual Property and Commercial Court.

8. NOTES AND ACCOUNTS RECEIVABLE, NET

Notes receivable Accounts receivable Less: Allowance for impairment loss		December 31	December 31
		2022 $ 18,619 8,080,052 (387,638) $ 7,711,033	2021 $ 33,376 7,682,979 (334,941) $ 7,381,414

The main credit terms range from 30 to 90 days.

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The Group serves a large consumer base for its telecommunications business; therefore, the concentration of credit risk is limited. When entering into transactions with customers, the Group considers the record of arrears in the past. In addition, the Group may also collect some telecommunication charges in advance to reduce the risk of payment arrears in subsequent periods.

The Group adopted a policy of only trading with corporate counterparties with a considerable scale of operations, certain credit ratings and financial conditions for telecommunications service and products. In addition to examining publicly available financial information and its own historical transaction experience, the Group obtains collateral where necessary to mitigate the risk of loss arising from default. The Group continues to monitor the credit exposure and financial and credit conditions of its counterparties, and spreads the total amount of the transactions among qualified counterparties.

In order to mitigate credit risk, the management of the Group has delegated a team responsible for determining credit limits, credit approvals and other monitoring procedures to ensure the recoverability of receivables. In addition, the Group reviews the recoverable amount of trade receivables at balance sheet dates to ensure that adequate allowance is provided for possible irrecoverable amounts. In this regard, the management believes the Group’s credit risk could be reasonably reduced.

The Group measures the loss allowance for trade receivables at an amount equal to lifetime ECLs. The ECLs on trade receivables are estimated using a provision matrix approach considering the past default records of the customers and an analysis of the customers’ current financial positions, as well as forward-looking indicators such as the change rates of consumer price index, economic leading indicators and economic growth rate. As the Group’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision matrix does not distinguish customer segments. As a result, the expected credit loss rate is based on the number of past due days of trade receivables.

The Group writes off a trade receivable when there is evidence indicating that the counterparty is in severe financial difficulty and the trade receivable is considered uncollectible. For trade receivables that have been written off, the Group continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are recognized in profit or loss.

Movements of the allowance for doubtful notes and accounts receivable by individual and collective assessment were as follows:

December 31, 2022

Not Past Due Gross carrying amount $ 7,311,629 Loss allowance (Lifetime ECLs) (54,025) Amortized cost $ 7,257,604 December 31, 2021 Not Past Due Gross carrying amount $ 7,017,682 Loss allowance (Lifetime ECLs) (51,762) Amortized cost $ 6,965,920	Overdue 1 to 120 Days 121 to 365 Days Over 365 Days $ 602,634 $ 183,562 $ 846 (159,225) (173,542) (846) $ 443,409 $ 10,020 $ - Overdue 1 to 120 Days 121 to 365 Days Over 365 Days $ 534,576 $ 159,467 $ 4,630 (128,302) (150,247) (4,630) $ 406,274 $ 9,220 $ -	Total $ 8,098,671 (387,638) $ 7,711,033 Total $ 7,716,355 (334,941) $ 7,381,414

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Expected credit loss rates of the Group for the aforementioned periods were as follows:

	Not Past Due
	and Past Due	Past Due Over
	within 120 Days	120 Days
Telecommunications services	0.02%-85%	65.5%-100%
Retail business and others	below 10%	10%-100%

Movements of the loss allowance of notes and accounts receivable were as follows:

Beginning balance Add: Provision Recovery Less: Write-off Ending balance	For the Year Ended	For the Year Ended	December 31
		2022 $ 334,941 252,393 44,014 (243,710) $ 387,638	2021 $ 306,755 209,730 43,263 (224,807) $ 334,941

The Group entered into an accounts receivable factoring contract with a private institution and sold those overdue accounts receivable that had been written off. Under the contract, the Group would no longer assume the risk on the receivables. The related factored accounts receivable information was as follows:

Amount of accounts receivable sold Proceeds from the sale of accounts receivable	For the Year Ended	For the Year Ended	December 31
		2022 $ 608,335 $ 60,100	2021 $ 716,882 $ 58,058

9. INVENTORIES

Merchandise Materials for maintenance		December 31	December 31
		2022 $ 8,089,629 11,711 $ 8,101,340	2021 $ 6,430,041 10,075 $ 6,440,116

For the years ended December 31, 2022 and 2021, the cost of goods sold related to inventories amounted to $105,999,977 thousand and $93,218,301 thousand, respectively, which included the inventory write-down totaling $37,436 thousand, and the reversal of inventory write-down totaling $20,459 thousand, respectively.

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10. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

Associates, which were not individually material and were accounted for using equity method, were as follows:

Investee Company AppWorks Ventures Co., Ltd. (AppWorks) AppWorks Fund III Co., Ltd. (AppWorks Fund III) Global Home Shopping Co., Ltd. (GHS) AppWorks Fund IV L.P. (AppWorks Fund IV) Uspace Tech Co., Ltd. (Uspace) kbro Media Co., Ltd. (kbro Media) NADA Holdings Corp. (NADA) Mistake Entertainment Co., Ltd. (M.E.) TV Direct Public Company Limited (TV Direct)		December 31	December 31	December 31
		2022 Amount % of Ownership $ 244,745 51.00 600,765 20.14 486,008 20.00 101,159 32.86 194,095 32.90 78,593 33.58 55,558 37.93 33,110 11.33 - - $ 1,794,033		2021
				Amount % of Ownership $ 270,997 51.00 689,849 20.14 571,213 20.00 - - - - 141,885 33.58 59,705 37.93 26,494 15.00 120,346 21.35 $ 1,880,489

Aggregate information of associates that were not individually material:

The Group’s share of: Profit (loss) Other comprehensive income (loss) Comprehensive income (loss)	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 10,145 (18,200) $ (8,055)	2021 $ (19,681) (13,577) $ (33,258)

a. AppWorks

In September 2019, TWM acquired 51% equity interest of AppWorks. TWM has no control over AppWorks due to its holding less than half number of seats on AppWorks’ board of directors. Therefore, TWM only has significant influence on AppWorks and accounts for its investment in AppWorks as an associate of TWM, under the equity-method of accounting.

b. AppWorks Fund III

In April 2020, TVC acquired 19.46% equity interest of AppWorks Fund III. TVC has significant influence on AppWorks Fund III since the president of TWM serves as the chairman of AppWorks Fund III. TVC’s percentage of ownership interest in AppWorks Fund III increased to 20.14% due to non-proportionate subscription to AppWorks Fund III’s issuance of new capital stock during 2020 to 2021.

The extraordinary stockholders’ meetings of AppWorks Fund III resolved to reduce its capital stock. TVC received proportional capital returns in September and December 2022, respectively.

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c. GHS

In June 2015, momo acquired 20% equity interest of GHS through its subsidiary.

As momo’s subsidiary did not participate in GHS’s capital increase in October 2015, its percentage of ownership interest in GHS decreased to 18%. In January 2016, its percentage of ownership interest in GHS increased to 20% due to the acquisition of an additional 2% equity interest of GHS.

momo recognized the impairment loss in GHS amounting to $82,231 thousand for the year ended December 31, 2022, classified as other gains and losses, mainly due to the increased market competition in China, and its operation was not as expected.

d. AppWorks Fund IV

In December 2022, TVC subscribed 32.86% equity of AppWorks Fund IV and became the single largest limited partner. Since the management, control, operation and decision-making of the limited partnerships investments are executed by general partner, TVC has no control over AppWorks Fund IV but retains significant influence.

e. Uspace

From October to November 2022, TVC acquired 32.9% equity interest of Uspace. Although TVC was the single largest stockholder of Uspace, it only obtained one out of five seats of the board of directors. In addition, the management considered the size of ownership interest and the dispersion of shares owned by other stockholders, the other holdings were not extremely dispersed. Therefore, TVC has no control over Uspace but retains significant influence.

f. kbro Media

In August 2012, TFNM acquired 32.5% equity interest of kbro Media.

In November 2020, kbro Media both decreased and increased capital. TFNM’s percentage of ownership interest in kbro Media increased to 33.58% due to non-proportionate subscription to kbro Media’s issuance of new capital stock.

g. NADA

In December 2021, TVC acquired 37.93% equity interest of NADA. Although TVC was the single largest stockholder of NADA, it only obtained two out of five seats of the board of directors. In addition, the management considered the size of ownership interest and the dispersion of shares owned by other stockholders, the other holdings were not extremely dispersed. Therefore, TVC has no control over NADA but retains significant influence.

h. M.E.

In May 2019, TKT acquired 15% equity interest of M.E. and its percentage of ownership interest in M.E. decreased to 11.33% due to non-proportionate subscription to M.E.’s issuance of new capital stock during 2022. TKT has significant influence on M.E. due to having a seat on M.E.’s board of directors.

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i. TV Direct

In June 2020, momo acquired 16.2% equity interest of Thailand TV Direct and had significant influence on TV Direct. momo’s percentage of ownership interest in TV Direct increased to 24.99% due to its additional acquisitions of TV Direct in the second half of 2020. momo’s percentage of ownership interest in TV Direct decreased to 21.35% due to non-subscription to the exercise of the share options, which were granted by TV Direct, in the first three quarters of 2021.

In May 2022, momo resolved to sell all its equity interest in TV Direct and reclassified the amount as non-current assets held for sale. From June 2022, momo started to sell its equity interests of TV Direct successively and sold out all its shares in August at the total amount of $200,156 thousand.

j. Alliance Digital Tech Co., Ltd. (ADT)

In November 2013, TWM acquired 19.23% equity interest of ADT.

In 2014, TWM’s percentage of ownership interest in ADT decreased to 13.33% as TWM did not subscribe for any newly issued ADT stock. In December 2016, TWM increased its percentage of ownership interest in ADT to 14.4% by subscribing for new stock issued by ADT. TWM still has significant influence on ADT due to having a seat on ADT’s board of directors.

ADT had resolved to adopt December 31, 2018 as the dissolution date. In August 2021, ADT completed the liquidation procedures. TWM received the liquidation capital returns of $7,830 thousand and $667 thousand for the years ended December 31, 2021 and 2022, respectively.

k. Taiwan Pelican Express Co., Ltd. (TPE)

In August 2012, momo acquired 20% equity interest of TPE.

In December 2013, momo’s percentage of ownership interest in TPE decreased to 17.7% as it did not subscribe for the new stock issued by TPE and sold part of its stock when TPE went public.

For the year ended December 31, 2020, momo sold part of TPE’s stock, and momo’s percentage of ownership interest in TPE decreased to 15.5%, whilst momo still had significant influence on TPE due to having 2 seats on TPE’s board of directors. In March 2021, momo sold the rest of its equity interests in TPE for $466,547 thousand.

11. SUBSIDIARIES WITH MATERIAL NON-CONTROLLING INTERESTS

Subsidiary momo	Proportion of Non-controlling Interests’ Ownership and Voting Rights
	December 31
	2022 2021 54.99% 54.99%

For information on the principal place of business and the company’s country of registration, see Table 7.

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The summarized financial information of momo and its subsidiaries had taken into account the adjustments to acquisition-date fair value, and reflected the amounts before eliminations of intercompany transactions as follows:

	December 31	December 31
2022 2021 $ 15,649,166 $ 14,923,554 18,165,009 15,564,958 (15,025,287) (12,793,604) (1,411,826) (1,372,429) $ 17,377,062 $ 16,322,479 $ 10,968,706 $ 10,493,176 6,320,135 5,739,281 88,221 90,022 $ 17,377,062 $ 16,322,479 For the Year Ended December 31
2022 2021 $ 103,436,435 $ 88,396,696 $ 3,433,902 $ 3,275,266 (266) (13,281) $ 3,433,636 $ 3,261,985 $ 1,546,094 $ 1,479,218 1,888,532 1,801,082 (724) (5,034) $ 3,433,902 $ 3,275,266 $ 1,545,951 $ 1,473,276 1,888,360 1,793,824 (675) (5,115) $ 3,433,636 $ 3,261,985 For the Year Ended December 31
	2022 $ 5,332,034 (3,084,933) (3,006,958) 170 $ (759,687) $ 1,301,491	2021 $ 5,720,847 (158,001) (1,813,450) (245) $ 3,749,151 $ 770,113

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12. PROPERTY, PLANT AND EQUIPMENT

Cost Balance, January 1, 2022 Additions Disposals and retirements Reclassification Effect of exchange rate changes Balance, December 31, 2022 Accumulated depreciation and impairment Balance, January 1, 2022 Depreciation Disposals and retirements Reclassification Effect of exchange rate changes Balance, December 31, 2022 Carrying amount, December 31, 2022 Cost Balance, January 1, 2021 Additions Disposals and retirements Reclassification Effect of exchange rate changes Balance, December 31, 2021 Accumulated depreciation and impairment Balance, January 1, 2021 Depreciation Disposals and retirements Reclassification Effect of exchange rate changes Balance, December 31, 2021 Carrying amount, December 31, 2021	Land $ 9,098,215 924,481 - 268,001 - $ 10,290,697 $ - - - - - $ - $ 10,290,697 $ 9,101,010 - (10,637 ) 7,842 - $ 9,098,215 $ - - - - - $ - $ 9,098,215	Buildings Telecommuni- cations Equipment and Machinery $ 5,723,861 $ 104,347,852 1,142 341,000 (140 ) (2,456,103 ) (57,519 ) 5,241,222 - 1,064 $ 5,667,344 $ 107,475,035 $ 1,994,389 $ 76,676,012 161,036 7,667,622 (140 ) (2,229,568 ) (23,427 ) - - 1,064 $ 2,131,858 $ 82,115,130 $ 3,535,486 $ 25,359,905 $ 5,725,270 $ 96,632,051 5,798 195,750 (10,645 ) (2,259,064 ) 3,438 9,779,665 - (550) $ 5,723,861 $ 104,347,852 $ 1,840,925 $ 71,461,532 163,125 7,352,725 (4,762 ) (2,137,769 ) (4,899 ) 21 - (497) $ 1,994,389 $ 76,676,012 $ 3,729,472 $ 27,671,840	Others Construction in Progress and Equipment to be Inspected $ 10,238,804 $ 1,702,372 297,753 7,756,993 (1,486,883 ) (1,010 ) 360,903 (5,578,141 ) 33 - $ 9,410,610 $ 3,880,214 $ 9,000,963 $ - 711,886 - (1,483,963 ) - - - 33 - $ 8,228,919 $ - $ 1,181,691 $ 3,880,214 $ 9,934,447 $ 2,950,912 281,290 8,814,587 (299,473 ) (58 ) 322,589 (10,063,069 ) (49) - $ 10,238,804 $ 1,702,372 $ 8,561,919 $ - 732,455 - (293,347 ) - (21 ) - (43) - $ 9,000,963 $ - $ 1,237,841 $ 1,702,372	Total $ 131,111,104 9,321,369 (3,944,136 ) 234,466 1,097 $ 136,723,900 $ 87,671,364 8,540,544 (3,713,671 ) (23,427 ) 1,097 $ 92,475,907 $ 44,247,993 $ 124,343,690 9,297,425 (2,579,877 ) 50,465 (599) $ 131,111,104 $ 81,864,376 8,248,305 (2,435,878 ) (4,899 ) (540) $ 87,671,364 $ 43,439,740

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Property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives as follows:

Buildings Primary buildings 20-55 years Mechanical and electrical equipment 5-15 years Telecommunications equipment and machinery 1-20 years Others 1-15 years

13. LEASE ARRANGEMENTS

a. Right-of-use assets

Carrying amount Land Buildings Telecommunications equipment and machinery Others Additions to right-of-use assets Depreciation charge for right-of-use assets Land Buildings Telecommunications equipment and machinery Others		December 31	December 31
	2022 2021 $ 616,943 $ 500,385 8,762,700 7,973,501 299,705 443,166 104,929 142,803 $ 9,784,277 $ 9,059,855 For the Year Ended December 31
		2022 $ 5,147,472 $ 241,315 3,704,004 149,824 58,033 $ 4,153,176	2021 $ 4,260,142 $ 234,709 3,566,614 157,664 61,003 $ 4,019,990

Except for the aforementioned additions and recognized depreciation, the Group did not have significant sublease or impairment of right-of-use assets during the years ended December 31, 2022 and 2021.

b. Lease liabilities

Carrying amount Current Non-current		December 31	December 31
		2022 $ 3,693,801 $ 6,155,641	2021 $ 3,540,466 $ 5,552,881

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Range of discount rates for lease liabilities was as follows:

Land Buildings Telecommunications equipment and machinery Others	December 31
	2022 2021 0.61%-1% 0.61%-1% 0.61%-1.2% 0.61%-1.2% 0.61%-4.38% 0.61%-4.38% 0.61%-0.86% 0.61%-0.86%

c. Material lease-in activities and terms

The Group leases base transceiver stations and machine rooms, stores, offices, warehouses, maintenance centers, equipment, etc., with most of the lease terms ranging from 1 to 6 years. The Group does not have bargain purchase options to acquire the leasehold assets at the end of the lease terms. In addition, the Group is prohibited from subleasing all or any portion of the underlying assets without the lessors’ consents in some lease agreements. The Group can early terminate the arrangements if there are any controversial or other incidental matters that will cause the leasehold assets not being able to meet the purposes of use.

d. Other lease information

Expenses related to short-term leases Expenses related to low-value asset leases Expenses related to variable lease payments and not included in the measurement of lease liabilities Total cash outflow for leases	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 36,697 $ 105,056 $ 29,587 $ 4,380,771	2021 $ 39,374 $ 73,913 $ 50,559 $ 4,264,912

14. INVESTMENT PROPERTIES

The Group leases its properties to others and thus reclassifies them from property, plant and equipment to investment properties.

The fair values of investment properties were measured using Level 3 inputs, arising from income approach, comparative approach, and cost approach adopted by a third party real estate appraiser, HomeBan Appraisers Joint Firm. As of December 31, 2022 and 2021, the fair values of investment properties were $6,877,283 thousand and $6,450,388 thousand, respectively, and the capitalization rates for the aforementioned financial reporting periods were ranging from 1.47%-5.23% and 1.37%-5.23%, respectively.

The amounts of depreciation recognized for the years ended December 31, 2022 and 2021 were $18,201 thousand and $18,314 thousand, respectively.

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

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 and thereafter		December 31	December 31
		2022 $ 91,600 34,181 29,722 25,740 9,321 34,137 $ 224,701	2021 $ 136,396 75,234 20,752 16,624 13,711 - $ 262,717

15. INTANGIBLE ASSETS

Cost Balance, January 1, 2022 Additions Disposals and retirements Reclassification Effect of exchange rate changes Balance, December 31, 2022 Accumulated amortization and impairment Balance, January 1, 2022 Amortization Disposals and retirements Effect of exchange rate changes Balance, December 31, 2022 Carrying amount, December 31, 2022 Cost Balance, January 1, 2021 Additions Disposals and retirements Reclassification Effect of exchange rate changes Balance, December 31, 2021 Accumulated amortization and impairment Balance, January 1, 2021 Amortization Disposals and retirements Effect of exchange rate changes Balance, December 31, 2021 Carrying amount, December 31, 2021		Conces	sions Service Concessions $ 8,180,078 - - - - $ 8,180,078 $ 1,567,463 178,719 - - $ 1,746,182 $ 6,433,896 $ 8,180,078 - - - - $ 8,180,078 $ 1,388,744 178,719 - - $ 1,567,463 $ 6,612,615	Goodwill $ 15,872,595 - - - - $ 15,872,595 $ 53,487 - - - $ 53,487 $ 15,819,108 $ 15,872,595 - - - - $ 15,872,595 $ 53,487 - - - $ 53,487 $ 15,819,108			Othe	r Intangible Asse	ts		Total $ 105,883,442 219,588 (75,338 ) 99,944 176 $ 106,127,812 $ 24,555,879 4,775,736 (75,338 ) 170 $ 29,256,447 $ 76,871,365 $ 105,600,561 236,568 (58,619 ) 105,023 (91) $ 105,883,442 $ 19,834,050 4,780,516 (58,619 ) (68) $ 24,555,879 $ 81,327,563
		Concession Licenses $ 71,699,375 - - - - $ 71,699,375 $ 17,818,565 4,136,584 - - $ 21,955,149 $ 49,744,226 $ 71,699,375 - - - - $ 71,699,375 $ 13,687,264 4,131,301 - - $ 17,818,565 $ 53,880,810				Computer Software $ 3,419,522 206,991 (63,715 ) 41,281 176 $ 3,604,255 $ 3,077,377 268,823 (63,715 ) 170 $ 3,282,655 $ 321,600 $ 3,231,391 225,525 (58,619 ) 21,316 (91) $ 3,419,522 $ 2,864,980 271,084 (58,619 ) (68) $ 3,077,377 $ 342,145	Customer Relationships $ 2,654,089 - (10,263 ) - - $ 2,643,826 $ 1,919,863 136,400 (10,263 ) - $ 2,046,000 $ 597,826 $ 2,654,089 - - - - $ 2,654,089 $ 1,783,463 136,400 - - $ 1,919,863 $ 734,226	Operating Rights $ 1,382,000 - - - - $ 1,382,000 $ - - - - $ - $ 1,382,000 $ 1,382,000 - - - - $ 1,382,000 $ - - - - $ - $ 1,382,000	Trademarks $ 2,518,355 169 (1,360 ) - - $ 2,517,164 $ 1,870 231 (1,360 ) - $ 741 $ 2,516,423 $ 2,517,900 455 - - - $ 2,518,355 $ 1,725 145 - - $ 1,870 $ 2,516,485	Copyrights $ 157,428 12,428 - 58,663 - $ 228,519 $ 117,254 54,979 - - $ 172,233 $ 56,286 $ 63,133 10,588 - 83,707 - $ 157,428 $ 54,387 62,867 - - $ 117,254 $ 40,174

The above intangible assets are amortized on a straight-line basis over their estimated useful lives as follows:

Concession licenses	14-21 years
Service concessions	44-50 years
Computer software	1-10 years
Customer relationships	20 years
Trademarks	10 years
Copyrights	Amortized over the
	broadcast period

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a. Service concessions

On January 15, 2009, TNH signed a BOT contract with the Taipei City Government. Under the BOT contract, TNH obtained the right to build and operate a development project located at the old Songshan Tobacco Plant. The development concession premium of superficies is amortized on a straight-line basis during the contract period, and the construction costs are amortized on a straight-line basis from the completion date of the construction to the BOT contract expiry date.

b. Customer relationships, operating rights, and trademarks

The Group measures the fair value of acquired assets when acquisitions occur, and identifies the fair value and amortization periods of the intangible assets which conform to materiality and related standards. Although some of the intangible assets such as operating rights and trademarks have legal useful lives, which can be extended, the Group regards these assets as intangible assets with indefinite useful lives.

1) On April 17, 2007, TFN, one of TWM’s wholly-owned subsidiaries, acquired more than 50% of the former Taiwan Fixed Network Co., Ltd. (formerly “TFN”) through a public tender offer. TWM split the former TFN and its subsidiaries into two cash-generating units, i.e., fixed network services and cable television and broadband business. Accordingly, customer relationships and operating rights are identified as major intangible assets.
2) On September 1, 2010, TFNM, one of TWM’s wholly-owned subsidiaries, acquired 55% of TKT. On August 12, 2011, TFNM acquired 45% of TKT. TWM measured the fair value of the acquired net assets and viewed TKT’s wireless services as one cash-generating unit. Accordingly, trademarks and customer relationships are identified as major intangible assets.
3) On July 13, 2011, WMT, one of TWM’s wholly-owned subsidiaries, acquired control over momo. TWM measured the fair value of the acquired assets and viewed momo’s retail business as one cash-generating unit. Accordingly, trademarks are identified as major intangible assets.
c. Goodwill

The carrying amounts of goodwill allocated to the cash-generating units were as follows:

Mobile communication services Fixed network services Retail business Cable television and broadband business		December 31	December 31
		2022 $ 7,211,936 357,970 4,979,566 3,269,636 $ 15,819,108	2021 $ 7,211,936 357,970 4,979,566 3,269,636 $ 15,819,108

d. Impairment of assets

In conformity with IAS 36 “Impairment of Assets”, the Group identified its mobile communication services, fixed network services, retail business, and cable television and broadband business as the smallest identifiable units which can generate cash inflows independently.

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The recoverable amounts of the operating assets were evaluated by business type, and the critical assumptions used for this evaluation were as follows:

1) Mobile communication services
a) Assumptions on cash flows

The five-year cash flow projections were estimated on the basis of previous experience, actual operating results, and the financial budget.

b) Assumptions on operating revenues

After taking changes in the telecom industry and the competitive landscape into consideration, operating revenues were estimated on the basis of the projected changes in subscriber numbers, minutes of incoming and outgoing calls, and rate plan composition.

c) Assumptions on operating costs and expenses

The estimates of activation commissions and customer retention costs were based on the new customers obtained and existing customers maintained. The estimates of remaining costs and expenses were based on the cost drivers of each item.

d) Assumptions on discount rates

For the years ended December 31, 2022 and 2021, the discount rates used to calculate the recoverable amount for the asset’s cash-generating unit were 5.79% and 6.01%, respectively.

2) Fixed network services
a) Assumptions on cash flows

The five-year cash flow projections were estimated on the basis of previous experience, actual operating results, and the financial budget.

b) Assumptions on operating revenues

After taking changes and growth of business in the telecom industry into consideration, operating revenues were estimated on the basis of the types of data transmission and the demand for broadband capacity.

c) Assumptions on operating costs and expenses

The estimates of operating costs and expenses were based on the cost drivers of each cost and expense.

d) Assumptions on discount rates

For the years ended December 31, 2022 and 2021, the discount rates used to calculate the recoverable amount for the asset’s cash-generating unit were 6.21% and 6.61%, respectively.

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3) Retail business

a) Assumptions on cash flows

The five-year cash flow projections were estimated on the basis of previous experience, actual operating results, and the financial budget.

b) Assumptions on operating revenues

After taking changes in the retail business industry and the competitive landscape into consideration, operating revenues were estimated on the basis of the classification and average price of commodities, and the degree of the contribution of the customers.

c) Assumptions on operating costs and expenses

The estimates of costs and expenses were based on the actual costs and expenses as a proportion of operating revenues.

d) Assumptions on discount rates

For the years ended December 31, 2022 and 2021, the discount rates used to calculate the recoverable amount for the asset’s cash-generating unit were 7.30% and 8.94%, respectively.

4) Cable television and broadband business
a) Assumptions on cash flows

The cash flow projections were estimated on the basis of the future operating years, along with previous experience, actual operating results, and the financial budget.

b) Assumptions on operating revenues

Operating revenues were estimated on the basis of revenues of the evaluated year, along with industry changes, competitive landscape and historical data.

c) Assumptions on operating costs and expenses

The estimates of operating costs and expenses were based on the actual costs and expenses as a proportion of operating revenues.

d) Assumptions on discount rates

For the years ended December 31, 2022 and 2021, the discount rates used to calculate the recoverable amount for the asset’s cash-generating unit for each system operator were ranged from 7.91% to 8.68% and 8.02% to 9.03%, respectively.

Based on the key assumptions of each cash-generating unit, the Group’s management believes that the carrying amounts of these operating assets and intangible assets will not exceed their recoverable amounts even if there are any reasonable changes in the critical assumptions used to estimate recoverable amounts. For the years ended December 31, 2022 and 2021, impairment losses on assets did not occur.

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16. OTHER NON-CURRENT ASSETS

Long-term accounts receivable Refundable deposits Other prepayments Others		December 31	December 31
		2022 $ 290,212 856,497 359,249 466,053 $ 1,972,011	2021 $ 214,054 751,641 527,264 465,310 $ 1,958,269

17. BORROWINGS

a. Short-term borrowings

December 31 2022 2021 Unsecured loans $ 20,550,000 $ 20,510,000 Annual interest rates 1.53%-1.66% 0.55%-0.94% For the information on endorsements and guarantees, see Note 31(b).		December 31	December 31
			2021 $ 20,510,000 0.55%-0.94%

b. Short-term notes and bills payable

Short-term notes and bills payable Less: Discounts on short-term notes and bills payable Annual interest rates Long-term borrowings Secured loans Commercial papers payable Less: Discounts on commercial papers payable Less: Current portion Annual interest rates: Secured loans Commercial papers payable		December 31
		2022 2021 $ 3,100,000 $ 4,600,000 (7,605) (2,207) $ 3,092,395 $ 4,597,793 1.658% 0.398%-0.458% December 31
	2022 2021 $ 2,059,160 $ 2,332,623 8,000,000 6,500,000 (3,503) (2,191) (3,773,126) (273,459) $ 6,282,531 $ 8,556,973 2.1895% 1.50% 0.688%-1.81% 0.687%-0.697%

c. Long-term borrowings

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1) Secured loans

TNH entered into a syndicated loan agreement, with respect to the investment under the aforementioned BOT contract. The credit agreement originally signed in 2010 had been terminated in advance. TNH signed another credit agreement with Bank of Taiwan for a $3,400,000 thousand credit amount and a $65,000 thousand guarantee amount in 2017. The agreement started from the date of the first drawdown of the loan and would last for 7 years with interest payments made on a monthly basis. In accordance with the loan agreement, the regular financial covenants, e.g., current ratio, equity ratio, and interest protection multiples, must be complied with during the credit facility period. For property under the BOT contract and its superficies that have been pledged as collateral, see Note 30.

2) Commercial papers payable

TWM’s commercial papers payable are treated as revolving credit facilities under the contracts. The last repayment dates of the commercial papers payable are no later than June 2025.

3) Unsecured loans

TWM entered into credit facility agreements with a group of banks for mid-term requirements of operating capital, and the interest is paid periodically. Under certain credit agreements, the loans are treated as revolving credit facilities, and the maturity dates of the loans are based on terms under the agreements. Some credit facilities are subject to financial covenants regarding debt ratios and interest protection multiples during the credit facility period. The unsecured loans, whose expiry date of the repayments was in July 2021, were fully repaid.

18. BONDS PAYABLE

5th domestic unsecured straight corporate bonds 6th domestic unsecured straight corporate bonds 7th domestic unsecured straight corporate bonds Less: Current portion		December 31	December 31
		2022 $ 14,996,589 19,987,778 2,497,207 (5,999,631) $ 31,481,943	2021 $ 14,994,030 19,984,764 2,496,703 - $ 37,475,497

a. 5th domestic unsecured straight corporate bonds

On April 20, 2018, TWM issued the 5th domestic unsecured straight corporate bonds. The bonds included five-year and seven-year bonds, with the principal amount of $6,000,000 thousand and $9,000,000 thousand, each having a face value of $10,000 thousand, and coupon rates of 0.848% and 1% per annum, respectively, with simple interest due annually. Repayment will be made in full at maturity. As of December 31, 2022, the amount of unamortized bond issue cost was $3,411 thousand. The trustee of bond holders is Bank of Taiwan.

Future repayments of the above-mentioned corporate bonds are as follows:

Year 2023 2025	Amount $ 6,000,000 9,000,000 $ 15,000,000

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b. 6th domestic unsecured straight corporate bonds

On March 24, 2020, TWM issued the 6th domestic unsecured straight corporate bonds. The bonds included five-year, seven-year, and ten-year bonds, with the principal amount of $5,000,000 thousand, $10,000,000 thousand and $5,000,000 thousand, each having a face value of $10,000 thousand, and coupon rates of 0.64%, 0.66% and 0.72% per annum, respectively, with simple interest due annually. Repayment will be made in full at maturity. As of December 31, 2022, the amount of unamortized bond issue cost was $12,222 thousand. The trustee of bond holders is Bank of Taiwan.

Future repayments of the above-mentioned corporate bonds are as follows:

Year 2025 2027 2030	Amount $ 5,000,000 10,000,000 5,000,000 $ 20,000,000

c. 7th domestic unsecured straight corporate bonds

On July 13, 2021, TWM issued the 7th domestic unsecured straight corporate bonds. The bond was seven-year bond, with the principal amount of $2,500,000 thousand, having a face value of $10,000 thousand, and coupon rate of 0.53% per annum, with simple interest due annually. Repayment will be made in full at maturity. As of December 31, 2022, the amount of unamortized bond issue cost was $2,793 thousand. The trustee of bond holders is Bank of Taiwan.

Future repayments of the above-mentioned corporate bonds are as follows:

Year 2028	Amount $ 2,500,000

d. 3rd domestic unsecured convertible bonds

On November 22, 2016, TWM issued its 3rd domestic five-year unsecured zero-coupon convertible bonds with an aggregate principal amount of $10,000,000 thousand and a par value of $100 thousand per bond certificate. The conversion price was set initially at $116.1 per share. The conversion price should be adjusted according to the prescribed formula and has been adjusted to $91.8 per share since August 29, 2021. Except for the book closure period, bondholders are entitled to convert bonds into TWM’s common stock from December 23, 2016 to November 22, 2021. The trustee of bond holders is Bank of Taiwan.

If the closing price of TWM’s common stock continues being at least 130% of the conversion price then in effect for 30 consecutive trading days or the aggregate outstanding balance of bonds payable is less than 10% of the original issuance amount, TWM has the right to redeem the outstanding bonds payable at par value in cash during the period from one month after the issuance date to the date 40 days prior to the maturity date.

At the end of the third year from the bond issuance date, bondholders have the right to request TWM to redeem the convertible bonds at par value in cash.

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The convertible bonds contain both liability and equity components. The equity component was presented in equity under the heading of capital surplus - option. The effective interest rate of the liability component was 0.9149% per annum on initial recognition.

Proceeds from the issuance (minus transaction costs $10,870 thousand) Equity component Financial liabilities Liability component at the date of issuance Interest charged at the effective interest rate Convertible bonds converted into common stock Repayment of the convertible bonds Liability component on December 31, 2021	$ 9,989,130 (400,564) (35,961) 9,552,605 245,053 (9,786,958) (10,700) $ -

The above-mentioned convertible bonds were due on November 22, 2021. As of the maturity date, the bondholders had requested to convert the bonds at face values of $9,989,300 thousand. The repayment of $10,700 thousand had been made on December 6, 2021.

19. PROVISIONS

	December 31	December 31
$	2022 999,153 505,570 16,334 1,521,057 80,467 1,440,590 1,521,057 Warranties $ 23,774 25,132 (32,572) - $ 16,334 $ 21,935 34,354 (32,515) - $ 23,774	2021 $ 995,275 447,279 23,774 $ 1,466,328 $ 74,007 1,392,321 $ 1,466,328 Total $ 1,466,328 123,406 (83,797) 15,120 $ 1,521,057 $ 1,517,702 126,279 (191,532) 13,879 $ 1,466,328
$
$
$

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20. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

Domestic firms of the Group adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed and defined contribution plan. Under the LPA, an entity makes monthly contributions to employees’ individual pension accounts at 6% of monthly salaries and wages. The employees of the Group’s subsidiaries in other countries are participants of state-managed retirement benefit plans operated by local governments. In accordance with the above provisions, the Group’s contributions to the pension plan amounted to $369,004 thousand and $347,738 thousand for the years ended December 31, 2022 and 2021, respectively.

b. Defined benefit plans

The Group contributed 2% of each employee’s monthly wages to the pension fund, with Bank of Taiwan acting as the custodian bank, in accordance with the defined benefit plans (Plans). The Plans provides defined pension benefits for the Group’s certain qualified employees, specified under the Labor Standards Law, and such benefits are determined based on an employee’s years of service and average monthly salary for six-month period prior to the date of retirement. Before the end of each year, the Group assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Group will fund the difference in one appropriation before the end of March of the following year. The fund is operated and managed by the government’s designated authorities; as such, the Group does not have any right to participate in the operation of the fund.

The defined benefit plans were as follows:

Present value of defined benefit obligations Fair value of plan assets Net defined benefit liabilities		December 31	December 31	December 31
		2022 $ 1,265,928 (1,157,297) $ 108,631	$ $	2021 1,534,000 (1,070,438) 463,562

The movements in present value of defined benefit obligations for the years ended December 31, 2022 and 2021 were as follows:

Balance, January 1 Current service costs Past service costs Interest costs Actuarial loss (gain) - changes in demographic assumptions Actuarial gain - changes in financial assumptions Actuarial gain - experience adjustments Benefits paid from plan assets Paid from defined benefit obligations Balance, December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 1,534,000 1,785 - 8,279 (8,824) (202,017) (29,016) (36,287) (1,992) $ 1,265,928	2021 $ 1,564,818 1,905 (1,163) 7,370 46,251 (48,379) (20,075) (16,727) - $ 1,534,000

49 -

The movements in the fair value of the plan assets for the years ended December 31, 2022 and 2021 were as follows:

Balance, January 1 Net interest income Return on plan assets (excluding amounts included in net interest) Contributions from the employer Benefits paid from plan assets Balance, December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 1,070,438 5,729 84,348 33,069 (36,287) $ 1,157,297	2021 $ 1,030,747 5,020 13,383 38,015 (16,727) $ 1,070,438

The expenses recognized in profit or loss for the years ended December 31, 2022 and 2021 were as follows:

Current service costs Past service costs Interest costs Net interest income	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 1,785 - 8,279 (5,729) $ 4,335	2021 $ 1,905 (1,163) 7,370 (5,020) $ 3,092

The pre-tax remeasurements recognized in other comprehensive income (loss) for the years ended December 31, 2022 and 2021 were as follows:

Return on plan assets (excluding amounts included in net interest) Actuarial loss (gain) - changes in demographic assumptions Actuarial gain - changes in financial assumptions Actuarial gain - experience adjustments	For the Year Ended	For the Year Ended	December 31
		2022 $ (84,348) (8,824) (202,017) (29,016) $ (324,205)	2021 $ (13,383) 46,251 (48,379) (20,075) $ (35,586)

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

1) Investment risk: The plan assets are invested in equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.
2) Interest risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.
50 -
3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.

The actuarial present values of the defined benefit obligation were carried out by the chartered actuary.

The principal assumptions used for the purpose of the actuarial valuations were as follows:

Discount rate Long-term average adjustment rate of salary	December 31
	2022 2021 1.3%-1.5% 0.5%-0.7% 2.0%-3.0% 2.5%-3.0%

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

Discount rate 0.25% increase 0.25% decrease Long-term average adjustment rate of salary 0.25% increase 0.25% decrease		December	31
		2022 $ (34,711) $ 36,004 $ 35,214 $ (34,126)	2021 $ (46,381) $ 48,242 $ 46,610 $ (45,068)

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 the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

The expected contributions to the Plans for the following year The average duration of the defined benefit obligation		December	31
	2022 2021 $ 32,192 $ 34,815 9-14.3 years 10-15.7 years

21. EQUITY

a. Share capital

As of December 31, 2022 and 2021, TWM’s authorized capital was $60,000,000 thousand and capital issued and outstanding were $35,192,336 thousand and $35,135,201 thousand, respectively, divided into 3,519,234 thousand shares and 3,513,520 thousand shares, respectively, which were all common stocks, at a par value of $10 each.

As of December 31, 2021, the bondholders of the 3rd domestic unsecured convertible bonds had requested to convert the bonds into 98,401 thousand common stocks, and the amounts recognized as capital collected in advance were $57,135 thousand. The unsecured convertible bonds were due on November 22, 2021. TWM had completed the related corporate registration procedures for the conversion.

51 -

b. Capital surplus

Additional paid-in capital from convertible corporate bonds Treasury stock transactions Difference between consideration and carrying amount arising from the disposal of subsidiaries’ stock Changes in equity of subsidiaries Changes in equity of associates accounted for using equity method Expired share options Others		December 31	December 31
		2022 $ 9,531,369 5,159,704 85,965 501,215 8,605 13,269 26,651 $ 15,326,778	2021 $ 11,107,455 5,159,704 85,965 501,215 10,828 13,269 24,803 $ 16,903,239

Under the ROC Company Act, capital surplus generated from the excess of the issue price over the par value of capital stock, including the stock issued for new capital, the conversion premium from convertible corporate bonds, treasury stock transactions, and the difference between consideration and carrying amount of subsidiaries’ stock disposed of, may be applied to make-up accumulated deficit, if any, or be transferred to capital as stock dividends, or be distributed as cash dividends when there is no accumulated deficit, and this transfer is restricted to a certain percentage of the paid-in capital. The capital surplus arising from changes in equity of subsidiaries, changes in equity of associates accounted for using equity method and the overdue unclaimed dividends could also be applied to make-up accumulated deficit, if any. The other capital surplus cannot be used by any means.

c. Appropriation of earnings and dividend policy

In accordance with the Company’s Articles of Incorporation, TWM’s profits earned in a fiscal year shall first be set aside to pay the applicable taxes, offset losses, and set aside for legal reserve pursuant to laws and regulations, unless the legal reserve has reached TWM’s total paid-up capital. The remaining profits shall be set aside for special reserve in accordance with laws, regulations, or business requirements. Any further remaining profits plus unappropriated earnings shall be distributed in accordance with the proposal submitted by the Board of Directors for approval at a stockholders’ meeting.

TWM adopts a dividend distribution policy whereby only surplus profits of TWM shall be distributed to stockholders. That is, after setting aside amounts for retained earnings based on TWM’s capital budget plan, the residual profits shall be distributed as cash dividends. Stock dividends in a particular year shall be capped at no more than 80% of total dividends to be distributed for that year. The amount of the distributable dividends, the forms in which dividends shall be distributed, and the ratio thereof shall depend on the actual profit and cash positions of TWM and shall be approved by resolutions of the Board of Directors, who shall, upon such approval, recommend the same to the stockholders for approval by resolution at the stockholders’ meetings.

The above appropriation of earnings should be resolved in the annual general stockholders’ meeting (AGM) held in the following year.

According to the ROC Company Act, a company shall first set aside its earnings as legal reserve until the legal reserve equals the paid-in capital. The legal reserve may be used to offset losses. After offsetting any deficit, the legal reserve may be transferred to capital and distributed as stock dividends or cash dividends for the amount in excess of 25% of the paid-in capital pursuant to a resolution adopted in the stockholders’ meeting.

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Pursuant to existing regulations, TWM is required to set aside and reverse additional special reserve equivalent to the net debit balance of the other equity interests, such as the exchange differences on translation and unrealized gain or loss on financial assets at fair value through other comprehensive income.

The appropriations of earnings for 2021 and 2020, which have been resolved in the AGM on June 23, 2022 and August 20, 2021, respectively, were as follows:

Legal reserve Special reserve Cash dividends Cash dividends per share (NT$)	Appropriation of Earnings
	For Fiscal Year 2021 For Fiscal Year 2020 $ 1,102,873 $ 1,330,074 (626,324) 2,449,739 10,551,987 9,521,178 3.7412 3.38353

In addition, cash distributions arising from capital surplus with respect to the excess of stock issuance price over the par value of capital stock, totaling $1,576,086 thousand and $2,577,603 thousand and representing $0.5588 and $0.916 per share, were also resolved in the AGM; thus, total distributions were $4.3 and $4.29953 per share, respectively, for 2021 and 2020.

TWM’s 2022 earnings appropriations will be proposed by the Board of Directors and approved in the AGM. Information on earnings appropriations is available on the Market Observation Post System website of the Taiwan Stock Exchange.

d. Other equity interests

Exchange
Differences on
Translation
Unrealized
Gain (Loss) on
Financial Assets
at FVTOCI

Balance, January 1, 2022
$ (44,294) $ (1,779,121)
Exchange differences on translation

14,777
-
Changes in fair value of financial assets at
FVTOCI

-
(149,838)
Changes in other comprehensive income
(loss) of associates accounted for using
equity method

1,655
(24,597)
Valuation loss of equity instruments
transferred to retained earnings due to
transfer and disposal

-
2,308,396

Valuation loss of equity instruments
transferred to retained earnings due to
disposal by associates

-
18,556
Income tax effect

-

(57,320)

Balance, December 31, 2022
$ (27,862)
$ 316,076

Total
$ (1,823,415)
14,777

(149,838)

(22,942)
2,308,396

18,556
(57,320)
$ 288,214
(Continued)

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Exchange
Differences on
Translation
Unrealized
Gain (Loss) on
Financial Assets
at FVTOCI

Balance, January 1, 2021
$ (31,679) $ (2,418,060)
Exchange differences on translation

(12,285)
-
Changes in fair value of financial assets at
FVTOCI

-
848,765
Valuation loss of equity instruments
transferred to retained earnings due to
disposal

-
2,209
Changes in other comprehensive income
(loss) of associates accounted for using
equity method

(330)
(21,598)
Other comprehensive income transferred to
retained earnings due to disposal of
investments accounted for using equity
method

-
(22,885)
Other comprehensive loss transferred to
retained earnings due to the decrease of
percentage of ownership interest in the
investments accounted for using equity
method

-
849
Income tax effect

-

(168,401)

Balance, December 31, 2021
$ (44,294)
$ (1,779,121)

Total
$ (2,449,739)
(12,285)
848,765
2,209

(21,928)

(22,885)
849
(168,401)
$ (1,823,415)
(Concluded)

e. Treasury stock

As of December 31, 2022 and 2021, TWM’s stocks held for the investment purposes by TCCI, TUI and TID, which are all wholly-owned by TWM, were 698,752 thousand shares, and the market values were $66,171,777 thousand and $69,875,160 thousand, respectively. Since TWM’s stocks held by its subsidiaries are regarded as treasury stock, TWM recognized $29,717,344 thousand as treasury stock. For those treasury stockholders, they have the same rights as the other stockholders, except that they are not allowed to subscribe new shares issued by TWM for cash and exercise the voting rights over such treasury stock.

22. OPERATING REVENUE

Revenue from contracts with customers Telecommunications and value-added services Sales revenue Cable TV and broadband services Others Other operating revenue	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 46,312,889 118,931,066 6,010,510 794,028 157,619 $ 172,206,112	2021 $ 45,058,294 104,122,968 5,968,850 809,939 149,482 $ 156,109,533

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a. Contract information

Please refer to Note 4 and Note 35.

b. Contract balances

Contract assets Bundle sales Less: Allowance for impairment loss Current Non-current	December 31, 2022 $ 10,580,384 (89,820) $ 10,490,564 $ 5,092,822 5,397,742 $ 10,490,564	December 31, 2021 $ 9,951,564 (84,514) $ 9,867,050 $ 4,667,271 5,199,779 $ 9,867,050	January 1, 2021 $ 8,441,819 (71,687) $ 8,370,132 $ 4,617,051 3,753,081 $ 8,370,132

For notes and accounts receivable, please refer to Note 8.

The Group measures the loss allowance for contract assets at an amount equal to lifetime ECLs. The contract assets will be transferred to accounts receivable when the corresponding invoice is billed to the client, and the contract assets have substantially the same risk as the trade receivables. Therefore, the Group concluded that the expected loss rates for trade receivables can be applied to the contract assets. As of December 31, 2022 and 2021, the expected credit loss rates were both 0.02%-0.85%.

Movements of the loss allowance of contract assets were as follows:

Beginning balance Provision Ending balance December 31, 2022 Contract liabilities Telecommunications and value-added services $ 1,289,461 Sales of goods 255,349 Cable TV and broadband services 628,941 Others 4,093 $ 2,177,844 Current $ 2,079,999 Non-current 97,845 $ 2,177,844	For the Year Ended December 31	For the Year Ended December 31
	2022 $ 84,514 5,306 $ 89,820 December 31, 2021 $ 1,195,258 154,895 624,065 10,090 $ 1,984,308 $ 1,894,828 89,480 $ 1,984,308	2021 $ 71,687 12,827 $ 84,514 January 1, 2021 $ 1,289,917 36,981 656,162 12,456 $ 1,995,516 $ 1,892,749 102,767 $ 1,995,516

55 -

The changes in balances of contract assets and contract liabilities primarily result from the timing difference between the satisfaction of performance obligations and the payments collected from customers. Other significant changes were as follows:

Contract assets Transfers of beginning balance to receivables	For the Year Ended December 31
	2022 2021 $ 4,555,995 $ 4,668,487

Revenue recognized in the current year from the contract liabilities at the beginning of the year is as follows:

Contract liabilities Telecommunications and value-added services Sales of goods Cable TV and broadband services Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 1,078,588 147,844 614,249 9,593 $ 1,850,274	2021 $ 1,156,434 35,186 646,471 12,341 $ 1,850,432

c. Partially completed contracts

As of December 31, 2022, the transaction prices allocated to the performance obligations that are not fully satisfied and the expected timing for recognition of revenue are as follows:

Telecommuni- cations and Value-added Services - in 2023 $ 26,921,109 - in 2024 13,938,208 - after 2025 6,307,025 $ 47,166,342	Cable TV and Broadband Services $ 23,312 13,095 2,056 $ 38,463	Others $ 355,058 243,136 1,876,141 $ 2,474,335	Total $ 27,299,479 14,194,439 8,185,222 $ 49,679,140

The above information does not include contracts with expected durations which are equal to or less than one year.

d. Assets related to contract costs

Incremental costs of obtaining a contract - non-current		December 31	December 31
		2022 $ 1,913,755	2021 $ 1,828,387

The Group considered the past experience and the default clauses in the sale contracts and believed the commission and the subsidy paid for obtaining a contract are wholly recoverable, therefore, such costs are capitalized. The amounts of amortization recognized for the years ended December 31, 2022 and 2021 were $1,322,091 thousand and $1,409,231 thousand, respectively.

56 -

23. NON-OPERATING INCOME AND EXPENSES

a. Other gains and losses, net

Gain (loss) on disposal and retirement of property, plant and equipment, net Gain on disposal of property, plant and equipment held for sale Gain on disposal of investments accounted for using equity method Gain on disposal of investments accounted for using equity method held for sale Impairment loss on non-financial assets Net gain (loss) on financial assets at fair value through profit and loss (FVTPL) Gain (loss) on foreign exchange, net Others	For the Year Ended	For the Year Ended	December 31
		2022 $ (214,387) 1,014 - 109,805 (82,231) 2,377 43,124 (147) $ (140,445)	2021 $ 8,690 - 97,791 - - (2,869) (10,649) 1,297 $ 94,260

b. Finance costs

Interest expense Corporate bonds Bank loans Commercial papers payable Lease liabilities Others	For the Year Ended	For the Year Ended	December 31
		2022 $ 294,207 258,662 85,049 72,723 26,493 $ 737,134	2021 $ 291,668 158,999 72,774 77,557 26,815 $ 627,813

24. INCOME TAX

a. Income tax recognized in profit or loss

Current income tax expense Current period Prior years’ adjustments Deferred income tax expense Temporary differences Income tax expense	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 3,139,040 (4,777) 3,134,263 85,567 $ 3,219,830	2021 $ 2,975,359 (357,625) 2,617,734 138,632 $ 2,756,366

57 -

The reconciliation of profit before tax to income tax expense was as follows:

Profit before tax Income tax expense at domestic statutory tax rate Effect of different tax rates on the group entities Adjustment items in determining taxable profit Temporary differences Loss carryforwards Land value increment tax Investment tax credits Prior years’ adjustments Income tax recognized in other comprehensive income (loss) Deferred income tax expense Unrealized gain/loss on financial assets at FVTOCI Remeasurements from defined benefit plans	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2022 2021 $ 16,191,242 $ 15,581,575 $ 3,238,248 $ 3,116,315 (4,284) (112) (99,970) (148,417) 85,567 138,632 4,976 6,843 70 2,686 - (1,956) (4,777) (357,625) $ 3,219,830 $ 2,756,366 For the Year Ended December 31
		2022 $ 57,320 64,841 $ 122,161	2021 $ 168,401 7,117 $ 175,518

b. Income tax recognized in other comprehensive income (loss)
c. Deferred tax assets and liabilities
1) Recognized deferred tax assets and liabilities

Changes in the amount of deferred tax assets and liabilities for the years ended December 31, 2022 and 2021 were as follows:

Deferred tax assets Property, plant and equipment Defined benefit plans Financial assets at FVTOCI Others		For the Year Ended December 31, 2022	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022
		Opening Balance $ 242,847 97,711 24,374 344,812 $ 709,744	Recognized in Profit or Loss Other Comprehensive Income (Loss) $ (15,674) $ - (6,145) (64,841) - (24,374) (22,732) - $ (44,551) $ (89,215)	Closing Balance $ 227,173 26,725 - 322,080 $ 575,978 (Continued)

58 -

For the Year Ended December 31, 2022	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022
Recognized in Opening Balance Profit or Loss Other Comprehensive Income (Loss) Closing Balance $ 1,105,489 $ 26,601 $ - $ 1,132,090 85,477 - 32,946 118,423 13,295 14,415 - 27,710 $ 1,204,261 $ 41,016 $ 32,946 $ 1,278,223 (Concluded) For the Year Ended December 31, 2021
	Recognized in Profit or Loss Other Comprehensive Income (Loss) $ (86,492) $ - (6,985) (7,117) (442) (88,235) 15,648 - $ (78,271) $ (95,352) $ 53,246 $ - - 80,166 7,115 - $ 60,361 $ 80,166 December 2022 $ 112,480		Closing Balance $ 242,847 97,711 24,374 344,812 $ 709,744 $ 1,105,489 85,477 13,295 $ 1,204,261 31
	Profit or Loss $ (86,492) (6,985) (442) 15,648 $ (78,271) $ 53,246 - 7,115 $ 60,361

		2022 $ 112,480	2021 $ 127,594

2) Unrecognized deferred tax assets items

As of December 31, 2022, the Group had not recognized the prior years’ loss carryforwards, totaling $112,480 thousand, as deferred tax assets. The expiry years are from 2023 to 2032.

59 -

d. Income tax examinations

The latest years for which the income tax returns of the entities in the Group have been examined and cleared by the tax authorities were as follows:

Company TWM TCC WMT TVC TNH TFN TT&T TCCI TDS TPIA TFC TUI TID TKT TFNM GFMT GWMT WTVB YJCTV MCTV PCTV UCTV GCTV momo FLI FPI FST Bebe Poshe FSL MFS	Year
	2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020 2020

25. EARNINGS PER SHARE

Basic EPS Profit attributable to owners of the parent Effect of dilutive potential common stock: Employees’ compensation Diluted EPS Profit attributable to owners of the parent (adjusted for potential effect of common stock)	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022
	Amount After Income Tax Weighted- average Number of Shares (In Thousands) $ 11,025,551 2,820,482 - 3,717 $ 11,025,551 2,824,199	EPS (NT$) $ 3.91 $ 3.90

60 -

Basic EPS Profit attributable to owners of the parent Effect of dilutive potential common stock: Employees’ compensation Convertible bonds Diluted EPS Profit attributable to owners of the parent (adjusted for potential effect of common stock)	For the Year Ended December 31, 2021	For the Year Ended December 31, 2021
	Amount After Income Tax Weighted- average Number of Shares (In Thousands) $ 10,988,165 2,814,930 - 4,221 4,735 5,669 $ 10,992,900 2,824,820	EPS (NT$) $ 3.90 $ 3.89

Since TWM has the discretion to settle the employees’ compensation by cash or stock, TWM should presume that the entire amount of the compensation will be settled in stock, and the potential stock dilution should be included in the weighted-average number of stock outstanding used in the calculation of diluted EPS, provided there is a dilutive effect. Such dilutive effect of the potential stock needs to be included in the calculation of diluted EPS until employees’ compensation is approved in the following year.

26. CASH FLOW INFORMATION

Changes in liabilities arising from financing activities:

For the year ended December 31, 2022

Opening Balance Lease liabilities (including current and non-current portions) $ 9,093,347 For the year ended December 31, 2021 Opening Balance Lease liabilities (including current and non-current portions) $ 9,036,955	Non-cash Changes New Leases Others $ 5,143,176 $ (208,419) Non-cash Changes New Leases Others $ 4,256,234 $ (128,119)	Ending Balance $ 9,849,442

		Ending Balance $ 9,093,347
Lease liabilities (including current and non-current portions)
	New Leases $ 4,256,234

27. CAPITAL MANAGEMENT

The Group maintains and manages its capital to meet the minimum paid-in capital required by the competent authority, and to optimize the balance of liabilities and equity in order to maximize stockholders’ return. By periodically reviewing and measuring relative cost, risk, and rate of return to ensure profit and to maintain adequate financial ratios, the Group may adopt various financing approaches to balance its capital structure in order to meet the demands for working capital, capital expenditures, settlements of liabilities, and dividend payments in its normal course of business for the future.

61 -

28. FINANCIAL INSTRUMENTS

a. Categories of financial instruments

Financial assets Financial assets at FVTPL (including current and non-current portions) (Note 1) Financial assets at FVTOCI (including current and non-current portions) Financial assets measured at amortized cost (including current and non-current portions) (Note 2) Financial liabilities Financial liabilities measured at amortized cost (including current and non-current portions) (Note 3)		December 31	December 31
		2022 $ 1,181,015 5,036,667 28,747,924 $ 34,965,606 $ 97,744,967	2021 $ 273,767 3,971,028 27,891,041 $ 32,135,836 $ 96,632,676

Note 1: Financial assets mandatorily measured at FVTPL
Note 2: The balances comprise cash and cash equivalents, notes and accounts receivable, other receivables, other financial assets and refundable deposits, which were financial assets measured at amortized cost.
Note 3: The balances comprise long-term and short-term borrowings, commercial papers payable, notes and accounts payable, other payables, other financial liabilities (classified as other current liabilities), bonds payable and guarantee deposits, which were financial liabilities measured at amortized cost.
b. Fair value of financial instruments
1) Financial instruments not measured at fair value

Except for the table below, the Group considers that the carrying amount of financial assets and liabilities that are not at fair value is close to the fair value, or the fair value cannot be reliably measured.

Financial liabilities Bonds payable (including current portion)	December 31	December 31
	2022	2021 Carrying Amount Fair Value $ 37,475,497 $ 37,702,271
	Carrying Amount Fair Value $ 37,481,574 $ 36,972,577

The fair value of bonds payable is measured by Level 2 inputs, using a volume-weighted average price on the TPEx at the end of the reporting period.

62 -
2) Fair value of financial instruments that are measured at fair value on a recurring basis

The table below provides the related analysis of financial instruments at fair value after initial recognition. Based on the extent that fair value can be observed, the fair value measurements are grouped into Levels 1 to 3:

Level 1: Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities on the reporting date.
Level 2: Inputs other than quoted prices included within Level 1 are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices).
Level 3: Inputs for the assets or liabilities are not based on observable market data (unobservable inputs).

December 31, 2022

Financial assets at FVTPL Domestic unlisted stocks Foreign unlisted stocks Foreign convertible notes Foreign limited partnerships Domestic limited partnerships Financial assets at FVTOCI Equity instruments Domestic listed stocks Domestic unlisted stocks Foreign unlisted stocks Foreign limited partnerships December 31, 2021 Financial assets at FVTPL Foreign unlisted stocks Foreign convertible notes Foreign limited partnerships	Level 1 $ - - - - - $ - $ 505,607 - - - $ 505,607 Level 1 $ - - - $ -	Level 2 $ - - - - - $ - $ - - - - $ - Level 2 $ - - - $ -	Level 3 $ 237,546 169,507 126,280 628,563 19,119 $ 1,181,015 $ - 1,224,455 2,096,317 1,210,288 $ 4,531,060 Level 3 $ 1,502 138,300 133,965 $ 273,767	Total $ 237,546 169,507 126,280 628,563 19,119 $ 1,181,015 $ 505,607 1,224,455 2,096,317 1,210,288 $ 5,036,667 Total $ 1,502 138,300 133,965 $ 273,767 (Continued)

63 -

Financial assets at FVTOCI Equity instruments Domestic listed stocks Domestic unlisted stocks Foreign unlisted stocks Foreign limited partnerships	Level 1 $ 1,711,959 - - - $ 1,711,959	Level 2 $ - - - - $ -	Level 3 $ - 608,146 961,276 689,647 $ 2,259,069	Total $ 1,711,959 608,146 961,276 689,647 $ 3,971,028 (Concluded)

There were no transfers between the fair value measurements of Levels 1 and 2 for the years ended December 31, 2022 and 2021.

Valuation techniques and assumptions used in fair value determination

a) The fair value of financial instruments traded in active markets is based on quoted market prices (including stocks of publicly traded companies).
b) Valuation techniques and inputs applied for Level 3 fair value measurement:

The evaluations of fair value of unlisted stocks and convertible notes were mainly referenced to the valuation of the same type of companies or the transaction prices of recent financing activities and estimated free cash flows through the market approach, income approach and asset approach. The unobservable inputs were the liquidity discount rate and the stock price volatility. The liquidity discount rates were ranged from 12.5% to 38% and 17.65% to 27.4% as of December 31, 2022 and 2021, respectively. The stock price volatility was ranged from 38.91% to 100.7% and 26.07% to 55.9% as of December 31, 2022 and 2021, respectively.

The fair value of limited partnerships investments was evaluated through the market approach, income approach and asset approach. The evaluation and assumptions are mainly referenced to related information of comparable transactions or companies and estimated future cash flows. The unobservable input was liquidity discount rate, which were estimated to be 26.2% as of December 31, 2022 and 2021.

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

For the year ended December 31, 2022

	Financial Assets	Financial Assets	Financial Assets
	at FVTPL -		at FVTOCI -
		Financial	Equity
	Instruments		Instruments
Balance at January 1, 2022	$	273,767	$ 2,259,069
Additions		904,871	1,911,815
Disposals		-	(2,138)
Recognized in profit or loss (gain on financial assets at
FVTPL)		2,377	-
Recognized in other comprehensive income (unrealized gain
on financial assets at FVTOCI)		-	362,314
Balance at December 31, 2022	$	1,181,015	$ 4,531,060

64 -

For the year ended December 31, 2021

	Financial Assets	Financial Assets	Financial Assets
	at FVTPL -		at FVTOCI -
		Financial	Equity
	Instruments		Instruments
Balance at January 1, 2021	$	-	$ 1,316,852
Additions		276,636	588,407
Recognized in profit or loss (loss on financial assets at
FVTPL)		(2,869)	-
Recognized in other comprehensive income (unrealized gain
on financial assets at FVTOCI)		-	593,756
Transferred out of Level 3 (Note)		-	(239,946)
Balance at December 31, 2021	$	273,767	$ 2,259,069

Note: Because certain equity investment’s quoted price (unadjusted) in active markets became available, its fair value hierarchy was transferred from Level 3 to Level 1.

c. Financial risk management

1) The Group’s major financial instruments include equity investments, hybrid investments, trade receivables, trade payables, commercial papers payable, bonds payable, borrowings, lease liabilities, etc., and the Group is exposed to the following risks due to usage of financial instruments:

a) Credit risk

b) Liquidity risk
c) Market risk

This note presents information concerning the Group’s risk exposure and the Group’s targets, policies and procedures to measure and manage the risks.

2) Risk management framework
a) Decision-making mechanism

The Board of Directors is the highest supervisory and decision-making body responsible for assessing material risks, designating actions to control these risks, and keeping track of their execution. In addition, the Operations and Management Committee conducts periodic reviews of each business group’s operating target and performance to meet the Group’s guidance and budget.

b) Risk management policies
i. Promote a risk-management-based business model.
ii. Establish a risk management mechanism that can effectively recognize, evaluate, supervise and control risk.
iii. Create a company-wide risk management structure that can limit risk to an acceptable level.
iv. Introduce best risk management practices and continue to seek improvements.
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c) Monitoring mechanism

The Internal Audit Office assesses the potential risks that the Group may face and uses this information as a reference for determining its annual audit plan. The Internal Audit Office reports the results and findings of performing such procedures, and follows up the discrepancies, if any, for actions.

3) Credit risk

Credit risk refers to the risk that a counterparty would default on its contractual obligations, resulting in a financial loss to the Group. The maximum credit exposure of the aforementioned financial instruments is equal to their carrying amounts recognized in the consolidated balance sheets as of the balance sheet date. The Group has large trade receivables outstanding with its customers. A substantial majority of the Group’s outstanding trade receivables are not covered by collateral or credit insurance. The Group has implemented ongoing measures including enhancing credit assessments and strengthening overall risk management to reduce its credit risk. While the Group has procedures to monitor and limit exposure to credit risk on trade receivables, there can be no assurance such procedures will effectively limit its credit risk and avoid losses. This risk is heightened during periods when economic conditions worsen.

As the Group serves a large number of unrelated consumers, the concentration of credit risk was limited.

4) Liquidity risk

Liquidity risk is the risk that the Group fails to meet the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s approach to manage liquidity is to ensure, as far as possible, that it always has sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable loss or damage to the Group’s reputation.

The Group manages and maintains a sufficient level of capital to ensure the requirements of paying estimated operating expenditures, including financial obligations on each contract. The Group also monitors its bank credit facilities to ensure that the Group fully complies with the provisions and financial covenants of loan contracts. As of December 31, 2022 and 2021, the Group had unused bank facilities of $57,999,357 thousand and $53,231,578 thousand, respectively.

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The table below summarizes the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments, but not including the financial liabilities whose carrying amounts approximate contractual cash flows:

December 31, 2022 Unsecured loans Secured loans Commercial papers payable Bonds payable Lease liabilities Other non-current liabilities December 31, 2021 Unsecured loans Secured loans Commercial papers payable Bonds payable Lease liabilities Other non-current liabilities	Contractual Cash Flows Within 1 Year $ 20,647,424 $ 20,647,424 2,148,727 321,034 11,279,084 6,697,116 38,614,380 6,288,130 9,972,657 3,755,413 438,750 73,125 $ 83,101,022 $ 37,782,242 $ 20,529,214 $ 20,529,214 2,437,877 312,043 11,186,827 4,642,649 38,902,510 288,130 9,209,493 3,601,434 511,875 73,125 $ 82,777,796 $ 29,446,595	1-5 Years $ - 1,827,693 4,581,968 24,705,000 6,077,746 292,500 $ 37,484,907 $ - 2,125,834 6,544,178 20,877,880 5,424,452 292,500 $ 35,264,844	5-10 Years $ - - - 7,621,250 139,498 73,125 $ 7,833,873 $ - - - 17,736,500 183,607 146,250 $ 18,066,357

5) Market risk

Market risk is the risk that arising from the changes in foreign exchange rates, interest rates, and prices, and will affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within an acceptable range and to optimize the return.

The Group carefully evaluates each financial instrument transaction involving any risk such as exchange rate risk, interest rate risk, and market price risk in order to decrease potential influences caused by market uncertainty.

a) Exchange rate risk

The Group mainly operates in Taiwan, except for international roaming services. Most of the operating revenue and expenses are measured in NTD. A small portion of the expenses is paid in USD, EUR, etc.; thus, the Group purchases currency at the spot rate based on the conservative principle in order to hedge exchange rate risk.

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The Group’s foreign currency assets and liabilities exposed to significant exchange rate risk were as follows:

Foreign currency assets Monetary items USD EUR RMB Non-monetary items USD RMB HKD Foreign currency liabilities Monetary items USD EUR RMB HKD JPY Foreign currency assets Monetary items USD EUR RMB Non-monetary items USD RMB HKD THB Foreign currency liabilities Monetary items USD EUR HKD JPY	December 31, 2022
	Foreign Currencies Exchange Rate New Taiwan Dollars $ 60,413 30.725 $ 1,856,196 143 32.65 4,675 19,685 4.401 86,633 137,567 30.725 4,226,738 110,431 4.401 486,008 1,070 3.942 4,217 10,727 30.725 329,573 79 32.65 2,579 375 4.401 1,650 1,707 3.942 6,728 13,183 0.23 3,028 December 31, 2021
	Foreign Currencies Exchange Rate New Taiwan Dollars $ 47,496 27.66 $ 1,313,781 1,273 31.25 39,797 27,887 4.341 121,059 69,035 27.66 1,909,511 131,586 4.341 571,213 4,279 3.547 15,179 144,178 0.835 120,346 15,223 27.66 421,055 48 31.25 1,502 2,917 3.547 10,348 21,014 0.241 5,058

Refer to Note 23(a) for the information related to the Group’s realized and unrealized foreign exchange gains (losses) for the years ended December 31, 2022 and 2021. Due to the variety of foreign currency transactions and functional currencies, the Group could not disclose the foreign exchange gains (losses) for each foreign currency with significant influence.

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Sensitivity analysis

The Group’s exchange rate risk comes mainly from conversion gains and losses of accounts denominated in monetary items of foreign currencies. If there had been an unfavorable 5% movement in the levels of foreign exchanges against NTD at the end of the reporting period (with other factors remaining constant at the end of the reporting period and with analyses of the two periods on the same basis), profit would have decreased by $80,197 thousand and $51,834 thousand for the years ended December 31, 2022 and 2021, respectively.

b) Interest rate risk

The Group issued unsecured straight corporate bonds and signed facility agreements with financial institutions for locking in medium- and long-term fixed interest rates to reduce the impact of interest rates fluctuation.

The carrying amounts of the Group’s financial assets and financial liabilities exposed to interest rate risk were as follows:

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities Sensitivity analysis	December 31
	2022 2021 $ 8,626,386 $ 7,104,028 67,289,430 78,889,675 8,275,250 10,034,628 14,408,584 2,332,623

The following sensitivity analysis is based on the exposure to interest rate risk of derivative and non-derivative instruments at the end of the reporting period. For floating-rate assets and liabilities, the analysis assumes that the balances of outstanding assets and liabilities at the end of the reporting period have been outstanding for the whole period and that the changes in interest rates are reasonable. If the interest rate had increased by 50 basis points (with other factors remaining constant at the end of the reporting period and with analyses of the two periods on the same basis), profit would have decreased by $30,667 thousand and increased by $38,510 thousand for the years ended December 31, 2022 and 2021, respectively.

c) Other market price risk

The exposure to financial instrument price risk is mainly due to holding of stocks. The Group manages the risk by maintaining portfolios of investments with different risks and by continuously monitoring the future developments and market trends of investment targets.

Sensitivity analysis

If the prices of financial instruments had decreased by 5% (with other factors remaining constant and with the analyses of the two periods on the same basis), net income would have decreased by $59,051 thousand and $13,688 thousand since the fair value of financial assets at FVTPL decreased for the years ended December 31, 2022 and 2021, respectively. Other comprehensive income would have decreased by $251,833 thousand and $198,551 thousand since the fair value of financial assets at FVTOCI decreased for the years ended December 31, 2022 and 2021, respectively.

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29. RELATED-PARTY TRANSACTIONS

a. Parent company and ultimate controlling party

TWM is the ultimate controlling party of the Group.

b. Related party name and nature of relationship

Related Party Nature of Relationship AppWorks Associate AppWorks Fund III Associate GHS Associate AppWorks Fund IV Associate Uspace Associate kbro Media Associate NADA Associate M.E. Associate AppWorks School Co., Ltd. Associate (subsidiary of AppWorks) Beijing Global JiuSha Media Technology Co., Ltd. Associate (subsidiary of GHS) Beijing YueShih JiuSha Media Technology Co., Ltd. Associate (subsidiary of GHS) Citruss Saudi Trading Company LLC Associate (subsidiary of GHS) Good Image Co., Ltd. Associate (subsidiary of kbro Media) Brilliant Creative Co., Ltd. Associate (subsidiary of kbro Media) TPE Associate (not a related party since the first quarter of 2021) Fubon Life Insurance Co., Ltd. Other related party Fubon Insurance Co., Ltd. (Fubon Insurance) Other related party Fubon Securities Investment Trust Co., Ltd. Other related party Fubon Sports & Entertainment Co., Ltd. Other related party Taipei Fubon Commercial Bank Co., Ltd. (TFCB) Other related party Fubon Financial Holding Co., Ltd. Other related party Fubon Life Insurance (HK) Ltd. Other related party Fubon Securities Co., Ltd. Other related party Fubon Futures Co., Ltd. Other related party Fubon Investment Services Co., Ltd. Other related party Fubon Marketing Co., Ltd. Other related party Fu-Sheng Insurance Agency Co., Ltd. Other related party Fubon Insurance Agency Co., Ltd. Other related party Fubon Financial Venture Capital Co., Ltd. Other related party Fubon Gymnasium Co., Ltd. Other related party Fubon Asset Management Co., Ltd. Other related party One Production Film Co., Ltd. Other related party Fubon Bank (China) Co., Ltd. Other related party Fubon Land Development Co., Ltd. Other related party Fubon Property Management Co., Ltd. Other related party Fubon Real Estate Management Co., Ltd. Other related party Fubon Hospitality Management Co., Ltd. Other related party Fubon Private Equity Co., Ltd. Other related party TFB Capital Co., Ltd. Other related party P. League+ Co., Ltd. Other related party (Continued)

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Nature of Relationship

Related Party

Jih Sun Financial Holding Co., Ltd.	Other related party
Jih Sun Securities Co., Ltd.	Other related party
Jih Sun International Bank, Ltd.	Other related party
Jih Sun International Property Insurance Agent Co., Ltd.	Other related party
Jih Sun Life Insurance Agent Co., Ltd.	Other related party
Jih Sun Futures Co., Ltd.	Other related party
Jih Sun Securities Investment Consulting Co., Ltd.	Other related party
Chung Hsing Constructions Co., Ltd.	Other related party
Ming Dong Co., Ltd. (Ming Dong)	Other related party
Fu Yi Health Management Co., Ltd.	Other related party
Dao Ying Co., Ltd.	Other related party
Fubon Xinji Investment Co., Ltd.	Other related party
Hung Fu Investment Co., Ltd	Other related party
Dai-Ka Ltd. (Dai-Ka)	Other related party
AppWorks Fund II Co., Ltd.	Other related party
AppWorks Ventures II Limited	Other related party
Chen Feng Investment Ltd.	Other related party
Chen Yun Co., Ltd.	Other related party
Xi Guo Co., Ltd.	Other related party
Cho Pharma Inc.	Other related party
kbro Co., Ltd. (kbro)	Other related party
Daanwenshan CATV Co., Ltd.	Other related party
North Taoyuan CATV Co., Ltd.	Other related party
Yangmingshan CATV Co., Ltd.	Other related party
Hsin Taipei CATV Co., Ltd.	Other related party
Chinpingtao CATV Co., Ltd.	Other related party
Hsintangcheng CATV Co., Ltd.	Other related party
Chuanlien CATV Co., Ltd.	Other related party
Chen Tao Cable TV Co., Ltd.	Other related party
Fengmeng Cable TV Co., Ltd.	Other related party
Hsinpingtao CATV Co., Ltd.	Other related party
Kuansheng CATV Co., Ltd.	Other related party
Nantien CATV Co., Ltd.	Other related party
Taiwan Win TV Media Co., Ltd.	Other related party
Taiwan Mobile Foundation (TMF)	Other related party
Taipei New Horizon Foundation (TNHF)	Other related party
Fubon Cultural & Educational Foundation	Other related party
Fubon Charity Foundation	Other related party
Fubon Art Foundation	Other related party
Taipei Fubon Bank Charity Foundation	Other related party
Taipei New Horizon Management Agency	Other related party
Far Eastern Memorial Hospital	Other related party (not a related party
	since the third quarter of 2021)
Key management	Chairman, director, president, vice
	president, etc.
	(Concluded)

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c. Significant transactions with related parties
1) Operating revenue

Associates Other related parties	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 3,265 1,603,444 $ 1,606,709	2021 $ 10,622 1,589,643 $ 1,600,265

The Group renders telecommunications, sales, maintenance, lease services, etc., to the related parties. The transaction terms with related parties were not significantly different from those with third parties.

2) Purchases

Associates Other related parties	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 811 944,748 $ 945,559	2021 $ 129,423 806,803 $ 936,226

The entities mentioned above provide broadband, copyright, broadcast, logistics, and other services. The transaction terms with related parties were not significantly different from those with third parties.

3) Receivables due from related parties

Account Related Party Categories Notes and accounts receivable Associates Notes and accounts receivable Other related parties Other receivables Other related parties		December 31	December 31
		2022 $ 9 576,751 $ 576,760 $ 310,173	2021 $ 714 382,360 $ 383,074 $ 222,966

Receivables from related parties mentioned above were not secured with collateral, and no provisions for impairment loss were accrued.

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4) Payables due to related parties

Account Related Party Categories Notes and accounts payable Associates Notes and accounts payable Other related parties Other payables Other related parties Prepayments Other related parties		December 31	December 31
		2022 2021 $ - $ 76 133,150 338,484 $ 133,150 $ 338,560 $ 66,226 $ 44,747 December 31
		2022 $ 14,058	2021 $ 11,915

5) Prepayments

6) Bank deposits, time deposits and other financial assets (including current and non-current portions)

Other related parties TFCB Others		December 31	December 31
		2022 $ 2,295,866 8,177 $ 2,304,043	2021 $ 2,691,502 10,554 $ 2,702,056

7) Acquisition of investments accounted for using equity method

Related Party Transaction
Transaction
Period
Shares
(In Thousands) Purchase Price
Participation in AppWorks Fund IV’s
capital increase
2022
-
$ 105,000
Contributions to M.E.’s capital increase
2022
77

3,628
$ 108,628
Contributions to AppWorks Fund III’s
capital increase
2021
36,025
$ 364,767
Acquisition of property, plant and equipment
For the Year Ended December 31, 2021
Purchase Price
Other related parties
$ 17,818

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9) Others

Refundable deposits Other related parties Other current liabilities - receipts under custody Other related parties Operating expenses Associates Other related parties TMF TNHF TFCB Others Other income Associates Other related parties		December 31	December 31
	2022 2021 $ 66,147 $ 62,324 $ 167,264 $ 159,666 For the Year Ended December 31
		2022 $ 1,134 16,100 5,000 849,233 252,457 $ 1,123,924 $ 15,056 60,590 $ 75,646	2021 $ 13,760 17,100 5,000 245,523 237,236 $ 518,619 $ 14,785 37,388 $ 52,173

10)	Lease arrangements Acquisition of right-of-use assets Other related parties Lease liabilities (including current and non-current portions) Other related parties	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
			2022 2021 $ 89,446 $ 391,338 December 31
			2022 $ 446,307	2021 $ 661,441

The leases are conducted by referring to general market prices, and all the terms and conditions conform to normal business practices.

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d. Key management compensation

The amounts of remuneration of directors and key executives were as follows:

Short-term employee benefits Termination and post-employment benefits	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 385,035 13,187 $ 398,222	2021 $ 359,320 15,328 $ 374,648

30. ASSETS PLEDGED

The assets pledged as collateral for bank loans, purchases, performance bonds and lawsuits were as follows:

Other current financial assets Service concessions Other non-current financial assets		December 31	December 31
		2022 $ 161,837 6,433,896 373,125 $ 6,968,858	2021 $ 158,359 6,612,615 358,570 $ 7,129,544

31. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

a. Unrecognized commitments

Purchases of property, plant and equipment Purchases of inventories and sales commitments		December 31	December 31
		2022 $ 8,392,457 $ 9,775,862	2021 $ 6,290,114 $ 7,827,270

As of December 31, 2022 and 2021, the amounts of lease commitments commencing after the balance sheet dates were $2,285,339 thousand and $2,137,020 thousand, respectively.

b. As of December 31, 2022 and 2021, the amounts of endorsements and guarantees provided to entities in the Group were $24,750,000 thousand.
c. On January 15, 2009, TNH signed the BOT contract with the Department of Cultural Affairs of Taipei City Government. The primary terms of the contract are summarized as follows:

1) Construction and operating period:

The construction and operating period are 50 years from the day following the signing of the contract.

75 -
2) Development concession:

The total initial amount of concession was $1,238,095 thousand (tax excluded). According to the supplemental agreement signed in November 2014, the concession would be paid with additional business tax from the signing date of the supplemental agreement; thus, the concession was increased by $48,750 thousand. The rest of the concession will be paid over 14 years from fiscal year 2015. As of December 31, 2022, $890,500 thousand (tax included) of the concession had been paid.

3) Performance guarantee:

As of December 31, 2022, TNH had provided a $32,500 thousand performance guarantee regarding the BOT contract.

4) Rental of land:

During the construction period, TNH should pay land value tax (1% of the announced land value) and other expenses.

During the operating period, TNH should pay 60% of 5% of the announced land value, that is, 3% of the announced land value. According to the supplemental agreement signed in November 2014, the concession will be paid with additional business tax from the date of agreement signing.

d. In August 2015, FET filed a statement of civil complaint with the Taipei District Court, in which FET claimed that (i) TWM shall apply for the return of the C4 spectrum block; (ii) TWM shall not use the C4 spectrum block; (iii) TWM shall not use the C1 spectrum block until TWM’s application for the return of the C4 spectrum block is approved by the NCC; and (iv) TWM shall provide $1,005,800 thousand to FET as compensation. In May 2016, the Court decided in favor of FET regarding claims (i), (ii), and (iii) of the lawsuit, and against FET regarding claim (iv) of the lawsuit. TWM and FET appealed with the High Court the reversal of the aforementioned sentences. The High Court dismissed the appeal of TWM regarding claims (i), (ii), and (iii), and regarding claim (iv) of FET, TWM shall pay FET $765,779 thousand, of which $152,584 thousand of the above amount, TWM shall make 5% annual interest payment for the period starting from September 5, 2015 to the payment date. TWM and FET appealed the reversal of the aforementioned sentences. In May 2019, the Supreme Court dismissed the portion of High Court’s original judgment on other appeal of FET regarding, and dismissed TWM’s payment obligation, and the Supreme Court remanded the case to the High Court. Under the first retrial of the High Court, TWM filed a counterclaim requesting that FET pay $14,482 thousand, as well as a 5% annual interest payment for the period starting from the date following the service of the counterclaim until the settlement date. In August 2020, the High Court first retrial results were as follows: for the dismissed claim (iv) stated above, TWM shall pay FET $242,154 thousand of which $142,685 thousand shall have 5% annual interest for the period starting from September 30, 2016 to the payment date, and $99,469 thousand shall have 5% annual interest for the period starting from July 21, 2017 to the payment date. TWM’s counterclaim was denied. TWM and FET appealed the aforementioned sentences which were not favorable to them. The case is now in process at the Supreme Court.

32. SIGNIFICANT EVENTS AFTER REPORTING PERIOD

a. On December 30, 2021, TWM’s Board of Directors resolved and signed the merger agreement with Taiwan Star Telecom Corporation Limited (TST). The NCC announced the approval of TWM's merger with TST with incidental provisions on January 18, 2023. On February 24, 2023, TWM’s Board of Directors resolved the share exchange ratio of one TST share for 0.0326 TWM shares. The merger still requires regulatory approval from the Fair Trade Commission.
76 -
b. In February 2023, the Board of Directors resolved that TWM would issue unsecured straight corporate bonds with a total amount of no more than $6,500,000 thousand.
c. In January 2023, the Board of Directors of momo resolved to construct a central area distribution center and purchase warehouse equipment, and planned to invest $6,300,000 thousand and $1,270,000 thousand, respectively.

33. OTHERS

Employee benefits, depreciation, and amortization are summarized as follows:

Employee benefits Salary Insurance expenses Pension Others Depreciation Amortization	For the Year Ended December 31	For the Year Ended December 31
	2022 Classified as Operating Costs Classified as Operating Expenses Total $ 2,834,911 $ 5,513,508 $ 8,348,419 265,424 501,325 766,749 130,630 242,709 373,339 142,222 274,557 416,779 11,753,441 958,480 12,711,921 4,634,956 1,462,871 6,097,827	2021
		Classified as Operating Costs Classified as Operating Expenses Total $ 2,739,967 $ 5,408,749 $ 8,148,716 243,062 482,918 725,980 118,802 232,028 350,830 127,719 277,917 405,636 11,280,990 1,005,619 12,286,609 4,622,068 1,567,679 6,189,747

Information of employees’ compensation and remuneration of directors

According to the Company’s Articles of Incorporation, the estimated employees’ compensation and remuneration of directors are set at the rates of 1% to 3% and no higher than 0.3%, respectively, of profit before income tax, employees’ compensation, remuneration of directors, and amounts reserved in advance. The estimations for employees’ compensation and remuneration of directors were calculated by applying the aforementioned rates.

The employees’ compensation and remuneration of directors of 2022 and 2021 shown below were approved by the Board of Directors on February 24, 2023 and February 22, 2022, respectively. There was no difference between the approved amounts and the amounts recognized.

Amounts approved by the Board of Directors Amounts recognized in the consolidated financial statements	For the Year Ended December 31	For the Year Ended December 31
	2022 Employees’ Compensation Paid in Cash Remuneration of Directors $ 305,936 $ 30,594 $ 305,936 $ 30,594	2021
		Employees’ Compensation Paid in Cash Remuneration of Directors $ 362,061 $ 36,206 $ 362,061 $ 36,206

If there is a change in the approved amounts after the annual consolidated financial statements are authorized for issue, the difference is recorded as a change in accounting estimate in the next year.

Information on the employees’ compensation and remuneration of directors approved by the Board of Directors is available at the Market Observation Post System website of the Taiwan Stock Exchange.

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34. ADDITIONAL DISCLOSURES

a. Information on significant transactions and b. Information on investees:
1) Financing extended to other parties: Table 1 (attached)
2) Endorsements/guarantees provided to other parties: Table 2 (attached)
3) Marketable securities held (excluding investments in subsidiaries and associates): Table 3 (attached)
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 4 (attached)
5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in
- capital: None
6) Disposal 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 of at least NT$100 million or 20% of the paid-in capital: Table 5 (attached)
8) Receivables from related parties of at least NT$100 million or 20% of the paid-in capital: Table 6 (attached)
9) Names, locations and related information of investees on which TWM exercised significant influence (excluding information on investments in mainland China): Table 7 (attached)
10) Trading in derivative instruments: None
11) Business relationships between the parent and the subsidiaries and significant intercompany transactions: Table 8 (attached)
c. Information on investments in mainland China:
1) The names of investees in mainland China, the main businesses and products, issued capital, method of investment, information on inflow or outflow of capital, ownership, net income or loss and recognized investment gain or loss, ending balance, amount received as earnings distributions from the investment, and limitation on investment: Table 9 (attached)
2) Significant direct or indirect transactions with the investee companies, the prices and terms of payment, unrealized gain or loss, and other related information, which is helpful to understand the impact of investment in mainland China on financial reports: None
d. Information of major stockholders, the name, the number of stocks owned, and percentage of ownership of each stockholder with ownership of 5% or greater: Table 10 (attached)
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35. SEGMENT INFORMATION

a. Segment revenue and operating results

The Group divides its business into four reportable segments with different market attributes and operation modes. The four segments are described as follows.

Telecommunications: providing mobile communication services, mobile phone sales and fixed-line services.

Retail: providing online shopping, TV shopping and catalog shopping.

Cable television and broadband: providing pay TV and cable broadband services.

Others: business other than telecommunications, retail, and cable television and broadband.

						Cable
For the Year	Telecommuni-				Television and				Adjustments and
Ended December 31, 2022		cations		Retail		Broadband		Others	Eliminations		Total
Operating revenue	$	65,692,017	$	103,436,435	$	6,332,644	$	578,474	$	(3,833,458 )	$ 172,206,112
Operating costs and expenses		56,196,938		99,363,351		4,171,173		371,081		(3,978,176 )	156,124,367
Operating income		10,133,635		4,284,819		2,170,139		207,394		96,752	16,892,739
						Cable
For the Year	Telecommuni-				Television and				Adjustments and
Ended December 31, 2021		cations		Retail		Broadband		Others	Eliminations		Total
Operating revenue	$	64,012,244	$	88,396,696	$	6,236,739	$	536,152	$	(3,072,298 )	$ 156,109,533
Operating costs and expenses		55,021,754		84,478,186		4,061,207		373,103		(3,193,757 )	140,740,493
Operating income		9,600,165		4,042,072		2,176,421		163,407		70,976	16,053,041

b. Geographical information

The Group’s revenue is generated mostly from domestic business. Overseas revenue is primarily generated from international calls and data services.

Consolidated geographic information for revenue was as follows:

Taiwan, ROC Overseas	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 169,558,040 2,648,072 $ 172,206,112	2021 $ 153,777,696 2,331,837 $ 156,109,533

c. Information on major customers

The Group does not have revenues from a single customer that exceeds 10% of the consolidated operating revenues.

79 -

TABLE 1

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

FINANCING EXTENDED TO OTHER PARTIES FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

No.	Lending Company	Borrowing Company	Financial Statement Account	Related Parties	Maximum Balance for the Period (Note 1)	Ending Balance (Note 1)	Drawdown Amounts	Interest Rate	Nature of Financing	Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Lending Limit for Each Borrowing Company	Lending Company’s Lending Amount Limits	Note
													Item	Value
1	TCC	TWM TFC	Other receivables Other receivables	Yes Yes	$ 500,000 700,000	$ 500,000 700,000	$ 413,000 291,000	0.86856%-1.12000% 1.16878%-1.82000%	Short-term financing Short-term financing	$ - -	Operation requirements Operation requirements	$ - -	- -	$ - -	$ 31,609,005 31,609,005	$ 31,609,005 31,609,005	Note 2 Note 2
2	WMT	TWM TKT TFNM WTVB	Other receivables Other receivables Other receivables Other receivables	Yes Yes Yes Yes	3,800,000 100,000 2,150,000 1,200,000	3,414,000 100,000 2,000,000 800,000	3,179,000 - 600,000 490,000	0.86867%-1.50622% - 0.86856%-1.12000% 0.86856%-1.70378%	Short-term financing Short-term financing Short-term financing Short-term financing	- - - -	Operation requirements Operation requirements Operation requirements Operation requirements	- - - -	- - - -	- - - -	9,018,628 9,018,628 9,018,628 9,018,628	9,018,628 9,018,628 9,018,628 9,018,628	Note 2 Note 2 Note 2 Note 2
3	TFN	TWM TCC	Other receivables Other receivables	Yes Yes	11,000,000 700,000	11,000,000 700,000	9,413,000 291,000	0.86867%-1.70378% 0.86878%-1.52000%	Short-term financing Short-term financing	- -	Operation requirements Operation requirements	- -	- -	- -	20,615,466 20,615,466	20,615,466 20,615,466	Note 2 Note 2
4	YJCTV	TFNM	Other receivables	Yes	30,000	-	-	0.86878%	Transactions	405,951	-	-	-	-	405,951	405,951	Notes 3 and 4
5	PCTV	TFNM	Other receivables	Yes	520,000	520,000	520,000	0.86878%-1.49733%	Transactions	523,729	-	-	-	-	523,729	523,729	Notes 3 and 4
6	GCTV	TFNM	Other receivables	Yes	250,000	250,000	250,000	0.86878%-1.49733%	Short-term financing	-	Repayment of financing	-	-	-	283,647	283,647	Note 3

Note 1: The maximum balance for the period and the ending balance represent quotas, not actual drawdown.

Note 2: Where funds are loaned for reasons of business dealings and short-term financing needs, the amount of loaned funds shall be limited to 40% of the lending company’s net worth. For short-term financing needs, the aggregate amount of loaned funds shall not exceed 40% of the lending company’s net worth. The individual loan funds shall be limited to the lowest amount of the following items: 1) 40% of the lending company’s net worth; 2) The amount that the lending company invests in the borrowing entities; or 3) An amount equal to (the share portion of the borrowing entities that the lending company invests in) * (the total loaning amounts of the borrowing company). In the event that a lending company directly and indirectly owns 100% of the borrowing company, or the borrowing company directly and indirectly owns 100% of the lending company, the individual lending amount and the aggregate amount of loaned funds shall not exceed 40% of the lending company’s net worth.

Note 3: Where funds are loaned for reasons of business dealings and short-term financing needs, the amount of loaned funds shall be limited to the total amount of business dealings and 40% of the lending company’s net worth. 1) For reasons of business dealings: The individual lending amount and the aggregate amount of loaned funds shall not exceed the amount of business dealings and the total amount of business dealings, respectively. 2) For short-term financing needs: The individual lending amount and the aggregate amount of loaned funds shall not exceed 40% of the lending company’s net worth.

Note 4: Where funds are loaned for reasons of business dealings, the aggregate amount of loans and the maximum amount permitted to a single borrower shall be prescribed within the aggregate amount of business transactions.

80 -

TABLE 2

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

ENDORSEMENT/GUARANTEE PROVIDED TO OTHER PARTIES FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

No.	Company Providing Endorsements/ Guarantees	Receiving Party	Receiving Party	Limits on Endorsements/ Guarantees Amount Provided to Each Entity	Maximum Balance for the Period (Note 1)	Ending Balance (Note 1)	Drawdown Amounts (Note 1)	Amount of Endorsements/ Guarantees Collateralized by Property	Ratio of Accumulated Endorsements/ Guarantees to Net Worth of the Guarantor (Note 1)	Maximum Endorsements/ Guarantees Amount Allowable	Guarantee Provided by Parent Company	Guarantee Provided by a Subsidiary	Guarantee Provided to Subsidiaries in Mainland China	Note
		Name	Nature of Relationship
0	TWM	TFN TKT TVC	Note 2 Note 2 Note 2	$ 42,000,000 313,800 8,550,000	$ 21,500,000 50,000 3,200,000	$ 21,500,000 50,000 3,200,000	$ 7,000,000 50,000 1,921,300	$ - - -	33.35 0.08 4.96	$ 64,470,756 64,470,756 64,470,756	Y Y Y	N N N	N N N	Note 3 Note 3 Note 3

Note 1: The maximum endorsement/guarantee balance for the period, the ending balance, and the drawdown amounts represent quotas, not actual drawdown.

Note 2: Direct/indirect subsidiary.

Note 3: For 100% directly/indirectly owned subsidiaries, the aggregate endorsement/guarantee amount provided shall not exceed the net worth of TWM, and the upper limit for each subsidiary shall be double the investment amount.

81 -

TABLE 3

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

MARKETABLE SECURITIES HELD (EXCLUDING INVESTMENTS IN SUBSIDIARIES AND ASSOCIATES) DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Investing Company	Marketable Securities Type and Name	Relationship with the Securities Issuer	Financial Statement Account		At the End of the Period	At the End of the Period		Note
				Units/Shares (In Thousands)	Carrying Amount	Percentage of Ownership (%)	Fair Value
TWM TCC WMT TVC	Listed Stocks Chunghwa Telecom Co., Ltd. Unlisted Stocks LINE Bank Taiwan Limited Bridge Mobile Pte Ltd. Limited Partnerships Grand Academy Investment, L.P. Starview Heights Investment, L.P. Unlisted Stocks Arcoa Communication Co., Ltd. Limited Partnerships The Last Thieves, L.P. Listed Stocks 91APP, Inc. Unlisted Stocks 17LIVE INC. Jayawijaya Finance Limited FIGMENT INC. Stampede Entertainment, Inc. TIKI GLOBAL PTE. LTD. CARSOME GROUP INC. Cloud Mile Inc. SoundOn Global Limited BAM Management US Holdings Inc. LINE MAN CORPORATION PTE. LTD. Swift Navigation, Inc. Swift Navigation, Inc. Partipost Pte. Ltd. Taiwan Web Service Corporation	- - - - - - - - - - - - - - - - - - - - - -	Current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Current financial assets at FVTPL Non-current financial assets at FVTOCI Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI	2,174 75,000 800 - - 6,998 - 2,500 525 5 - 1,333 760 733 5,396 - 246 1,100 214 364 899 3,000	$ 245,607 674,999 30,137 1,108,681 101,607 91,046 - 260,000 18,773 150,734 4,458 401,422 516,856 39,943 573,943 15,100 129,484 273,391 29,819 50,692 26,855 16,284	0.028 5 10 21.67 21.67 5.21 7.14 2.12 0.2 6.24 0.09 7.51 2.39 0.34 18.2 1 0.12 0.95 0.3 0.5 2.53 4.48	$ 245,607 674,999 30,137 1,108,681 101,607 91,046 - 260,000 18,773 150,734 4,458 401,422 516,856 39,943 573,943 15,100 129,484 273,391 29,819 50,692 26,855 16,284	Note 1 Note 1 Note 1 Note 2 Note 2

(Continued)

82 -

Investing Company	Marketable Securities Type and Name	Relationship with the Securities Issuer	Financial Statement Account		At the End of the Period	At the End of the Period		Note
				Units/Shares (In Thousands)	Carrying Amount	Percentage of Ownership (%)	Fair Value
TVC TCCI TUI TID momo	Limited Partnerships AUM CREATIVE FUND II Linse Capital Fund I, L.P. LINSE CAPITAL SKY II LLC Northstar Equity Partners V Limited Pantera Blockchain Offshore Fund L.P. Pioneer Fund II L.P. Soma Capital Fund III, L.P. TOMORROW TOGETHER FUND Convertible Notes CARSOME GROUP INC. Listed Stocks TWM Unlisted Stocks Great Taipei Broadband Co., Ltd. Listed Stocks TWM Listed Stocks TWM Unlisted Stocks Media Asia Group Holdings Limited Gaius Automotive Inc. We Can Medicines Co., Ltd. LINE Bank Taiwan Limited	- - - - - - - - - TWM - TWM TWM - - - -	Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Current financial assets at FVTOCI Non-current financial assets at FVTPL Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI	- - - - - - - - - 200,497 10,000 410,665 87,590 4,367 5,750 3,073 37,500	$ 16,365 66,786 92,074 213,175 91,516 82,465 66,182 19,119 126,280 18,987,043 38,639 38,890,003 8,294,731 4,217 237,546 65,988 337,499	16.05 0.89 2.67 1.72 0.32 13.58 1.21 23.53 - 5.7 6.67 11.67 2.49 0.15 8.02 7.68 2.5	$ 16,365 66,786 92,074 213,175 91,516 82,465 66,182 19,119 126,280 18,987,043 38,639 38,890,003 8,294,731 4,217 237,546 65,988 337,499	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1

Note 1: Percentage of ownership is the percentage of capital contribution.

Note 2: The shares held as of the period ended were fewer than 1,000 shares.

Note 3: For the information on investments in subsidiaries and associates, see Table 7 and Table 9 for details.

(Concluded)

83 -

TABLE 4

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST $300 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2022

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

Company Name	Type and Name of Marketable Securities	Financial Statement Account	Counterparty	Relationship	Beginning Balance		Acquisition			Disposal			Ending	Balance
					Units/Shares (In Thousands)	Amount	Units/Shares (In Thousands)	Amount	Units/Shares (In Thousands)	Amount	Carrying Amount	Gain (Loss) on Disposal	Units/Shares (In Thousands)	Amount (Note 1)
TWM TVC momo	Unlisted Stocks TVC LINE Bank Taiwan Limited Listed Stocks APT (Note 4) Unlisted Stocks Cloud Mile Inc. Unlisted Stocks LINE Bank Taiwan Limited	Investments accounted for using equity method Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI	- - - - -	Subsidiary - - - -	217,500 50,000 97,171 - -	$ 2,736,210 408,139 798,745 - -	210,000 37,500 - 5,396 37,500	$ 2,100,000 375,000 - 443,459 375,000	- 12,500 (Note 3) 97,171 - -	$ - - 671,375 - -	$ - - 2,980,000 - -	$ - - (2,308,625) (Note 4) - -	433,051 (Note 2) 75,000 - 5,396 37,500	$ 4,604,998 674,999 - 573,943 337,499

Note 1: The ending balance included the relevant adjustments to share of profit of investments accounted for using equity method and financial assets.

Note 2: The ending balance of shares included the stock dividends, amounting to 5,551 thousand shares, received in the third quarter of 2022.

Note 3: LINE Bank Taiwan Limited reduced capital to write off 25% of the accumulated deficit in the second quarter of 2022, and TWM decreased 12,500 shares in accordance with the percentage of ownership.

Note 4: TWM exercised appraisal right in the second quarter of 2022 and deposited all of the held interests. The valuation loss was transferred from other equity to retained earnings.

84 -

TABLE 5

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES OF AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Company Name	Related Party	Nature of Relationship		Transaction Details	Transaction Details		Transactions with Terms Different from Others	Transactions with Terms Different from Others	Notes/Accounts Payable or Receivable	Notes/Accounts Payable or Receivable	Note
			Purchase/Sale	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
TWM TWM&TDS TNH TFN TT&T TPIA TFNM MCTV WTVB momo	TFN TPIA TFNM TKT momo Fubon Insurance TWM TFC TFNM kbro TWM Fubon Insurance YJCTV PCTV UCTV GCTV Dai-Ka kbro FSL MFS kbro	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Other related party Parent Fellow subsidiary Fellow subsidiary Other related party Ultimate parent Other related party Subsidiary Subsidiary Subsidiary Subsidiary Other related party Other related party Subsidiary Subsidiary Other related party	Sale Purchase Sale Purchase Purchase Sale Purchase Sale Sale Sale Sale Sale Sale Sale Channel leasing fee Channel leasing fee Channel leasing fee Channel leasing fee Royalty for copyright Sale Purchase Purchase Purchase	$ 155,456 5,043,666 200,317 179,116 239,396 3,041,736 239,239 294,662 126,354 153,384 217,377 379,556 956,348 338,431 372,043 484,014 215,586 174,174 155,992 194,132 907,150 203,739 132,202	- 11 - - 1 5 1 - 22 2 2 4 91 97 10 14 6 5 51 18 1 - -	Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms	- - - - - - - - - - - - - - Note 1 Note 1 Note 1 Note 1 Note 1 - - - -	- - - - - - - - - - - - - - Note 1 Note 1 Note 1 Note 1 Note 1 - - - -	$ 23,524 (495,576) 80,109 (41,000) (45,184) 362,727 (18,512) 59,925 8,009 25,391 34,242 63,089 87,839 103,335 - - - - (30,769) 64,615 (254,317) (17,631) (51)	- Note 2 1 Note 2 2 5 1 1 59 2 3 6 91 96 - - - - 74 8 2 - -	Note 3 Note 3

Note 1: The companies authorized a related party to deal with the copyright fees for cable television. As the said account item is the only one, there is no comparable transaction.

Note 2: Including accounts payable and other payables.

Note 3: Accounts receivable (payable) was the net amount after being offset.

85 -

TABLE 6

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

RECEIVABLES FROM RELATED PARTIES OF AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Company Name	Related Party	Nature of Relationship	Ending Balance	Ending Balance	Turnover Rate	Overdue	Overdue	Amount Received in Subsequent Period	Allowance for Impairment Loss
						Amount	Action Taken
TWM TCC WMT TFN TPIA PCTV GCTV momo FSL	momo TWM TFC TWM TFNM WTVB TWM TCC Fubon Insurance TFNM TFNM TWM TFCB momo	Subsidiary Parent Subsidiary Parent Subsidiary Subsidiary Ultimate parent Parent Other related party Parent Parent Ultimate parent Other related party Parent	Accounts receivable Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Accounts receivable Other receivables Other receivables Accounts receivable Accounts receivable Other receivables Accounts receivable Other receivables Accounts receivable Other receivables Accounts receivable Other receivables Accounts receivable	$ 362,727 95,724 413,731 291,842 3,193,040 600,608 491,156 501,644 9,488,405 291,703 103,335 6,092 520,036 2,481 250,002 50,391 66,042 233,631 279,185 254,851	9.15 10.81 3.42 7.22 7.11 11.89 Note 4.6	$ - - - - - - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - - - - - -	$ 357,446 29,513 - - 3,193,040 - 177 448,328 19,255 - 28,821 3.994 35 1,578 1 49,763 59,448 233,075 279,185 238,725	$ - - - - - - - - - - - - - - - - - - - -

Note: Not applicable due to the transaction partners and the nature of transactions.

86 -

TABLE 7

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

NAMES, LOCATIONS AND RELATED INFORMATION OF INVESTEES ON WHICH TWM EXERCISED SIGNIFICANT INFLUENCE (EXCLUDING INFORMATION ON INVESTMENT IN MAINLAND CHINA) FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Investor	Investee	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance at the End of the Period	Balance at the End of the Period	Balance at the End of the Period	Net Income (Loss) of the Investee	Investment Income (Loss)	Note
				December 31, 2022	December 31, 2021	Shares (In Thousands)	Percentage of Ownership (%)	Carrying Amount
TWM TCC WMT TVC TFN TCCI TWMFM TFNM	TCC WMT TVC TNH FSD AppWorks TFN TT&T TWM Holding TCCI TDS TPIA TFC TFNM GFMT GWMT WTVB momo TWMFM AppWorks Fund III NADA AppWorks Fund IV Uspace TUI TID SFF TKT YJCTV MCTV PCTV UCTV GCTV kbro Media	Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan British Virgin Islands Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan	Investment Investment Investment Building and operating Songshan Cultural and Creative Park BOT project Information services Venture capital, investment consulting, and management consulting Fixed line service provider Call center service and telephone marketing Investment Investment Commissioned maintenance services Property insurance agent Cloud and information services Type II telecommunications business Investment Investment TV program provider Wholesale and retail sales Film production Venture capital Animation production Venture capital Information software service Investment Investment Film production Digital music services Cable TV service provider Cable TV service provider Cable TV service provider Cable TV service provider Cable TV service provider Film distribution, arts and literature services, and entertainment	$ 40,397,288 16,871,894 4,275,000 1,918,655 30,000 235,000 21,000,000 56,210 347,951 17,285,441 25,000 5,000 200,000 5,210,443 16,984 92,189 222,417 8,129,394 11,300 583,292 60,000 105,000 200,030 22,314,609 3,603,149 300 156,900 2,061,522 510,724 3,261,073 1,986,250 1,221,002 341,250	$ 40,397,288 16,871,894 2,175,000 1,918,655 - 235,000 21,000,000 56,210 347,951 17,285,441 25,000 5,000 200,000 5,210,443 16,984 92,189 222,417 8,129,394 300 694,767 60,000 - - 22,314,609 3,603,149 - 156,900 2,061,522 510,724 3,261,073 1,986,250 1,221,002 341,250	502,970 42,065 433,051 191,866 3,000 2,168 2,100,000 2,484 - 154,721 2,500 500 20,000 230,921 1,500 8,945 18,177 98,354 1,130 57,877 4,286 - 5,969 400 104,712 30 14,700 33,940 6,248 68,090 169,141 51,733 21,994	100 100 100 49.9 100 51 100 100 100 100 100 100 100 100 100 100 100 45.01 100 20.14 37.93 32.86 32.90 100 100 100 100 100 29.53 100 99.22 92.38 33.58	$ 19,869,765 22,545,770 4,604,998 1,960,752 23,421 244,745 51,539,627 155,012 241,896 25,988,580 103,044 110,571 246,602 6,768,720 17,424 97,885 396,195 10,968,706 11,054 600,765 55,558 101,159 194,095 33,743,265 7,202,078 254 334,369 1,449,291 628,626 3,465,185 2,051,901 1,277,609 78,593	$ 3,905,482 3,173,222 120,947 115,316 (3,246) (18,337) 3,538,184 48,442 19,397 2,120 8,651 100,571 67,009 1,598,631 123 2,231 126,931 3,434,626 (184) 724,769 1,090 (13,309) (67,590) (76) (76) (46) 43,930 (61,672) 24,943 122,399 33,236 34,946 (149,709)	$ 3,906,214 3,172,668 120,947 56,350 (6,579) (10,213) - - - - - - - - - - - - - - - - - - - - - - - - - - -	Note 1 Note 1 Note 1 Note 1 Note 1 Note 2 Note 2 Notes 2 and 3 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Notes 2 and 4 Note 2 Note 2 Note 2 Note 2 and 5 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Notes 2 and 6 Note 2 Note 2 Note 2 Note 2

(Continued)

87 -

Investor	Investee	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance at the End of the Period	Balance at the End of the Period	Balance at the End of the Period	Net Income (Loss) of the Investee	Investment Income (Loss)	Note
				December 31, 2022	December 31, 2021	Shares (In Thousands)	Percentage of Ownership (%)	Carrying Amount
TKT GFMT GWMT momo Asian Crown (BVI) Fortune Kingdom Honest Development	M.E. UCTV GCTV Asian Crown (BVI) Honest Development FLI FPI FST Bebe Poshe FSL MFS Prosperous Living TV Direct Fortune Kingdom HK Fubon Multimedia HK Yue Numerous	Taiwan Taiwan Taiwan British Virgin Islands Samoa Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Thailand Samoa Hong Kong Hong Kong	Livestreaming artists management services and digital media production Cable TV service provider Cable TV service provider Investment Investment Life insurance agent Property insurance agent Travel agent Wholesale of cosmetics Logistics and transport Wholesaling Wholesale and retail sales Wholesale and retail sales Investment Investment Investment	$ 30,628 16,218 91,910 885,285 670,448 3,000 3,000 6,000 90,880 250,000 100,000 220,850 Note 8 1,132,789 1,132,789 670,448	$ 27,000 16,218 91,910 885,285 670,448 3,000 3,000 6,000 85,000 250,000 100,000 220,850 179,406 1,132,789 1,132,789 670,448	537 1,300 3,825 9,735 21,778 500 500 3,000 8,868 25,000 10,000 22,085 Note 8 11,594 11,594 16,600	11.33 0.76 6.83 81.99 100 100 100 100 88.68 100 100 73.62 Note 8 100 100 100	$ 33,110 15,775 96,447 17,506 560,502 2,922 12,983 46,612 27,953 374,472 98,399 223,833 Note 8 16,913 16,913 560,502	$ 21,884 33,236 34,946 (3,448) (99,495) (2,280) 3,515 5,577 (5,790) 118,512 (2,380) 4,232 Note 8 (3,834) (3,834) (99,495)	$ - - - - - - - - - - - - - - - -	Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Notes 2 and 7 Note 2 Note 2 Note 2 Note 2 Note 2 Notes 2 and 8 Note 2 Note 2 Note 2

Note 1: Downstream transactions, upstream transactions, and consolidated unrealized gain or loss are included.

Note 2: The income/loss of the investee was already included in the income/loss of the investor, and is not presented in this table.

Note 3: Held 1 share as of period end.

Note 4: Material non-controlling interests.

Note 5: Percentage of ownership is the percentage of capital contribution.

Note 6: 70.47% of stocks are held under trustee accounts.

Note 7: Renamed as Fuli Insurance Agent Co., Ltd. in February 2023, and changed its main business to comprehensive insurance agent.

Note 8: momo sold all of its equity interest of TV Direct in August 2022.

Note 9: For information on investments in mainland China, see Table 9 for the details.

(Concluded)

88 -

TABLE 8

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Number	Company Name	Counterparty	Nature of Relationship (Note 1)		Transaction Details	Transaction Details	Percentage of Consolidated Total Operating Revenue or Total Assets
				Account	Amount	Transaction Terms (Note 2)
0	TWM	TFN TPIA momo TFN TFNM momo TFNM TNH TFN WMT TCC TFN TKT TFNM momo TFN WMT TT&T TDS momo TFN TNH YJCTV GCTV TFN momo TFN TPIA TFNM momo TFN TKT TDS TFNM YJCTV PCTV	1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1	Notes and accounts receivable, net Notes and accounts receivable, net Notes and accounts receivable, net Other receivables Other receivables Other receivables Other non-current assets Other non-current assets Short-term borrowings Short-term borrowings Short-term borrowings Notes and accounts payable Notes and accounts payable Notes and accounts payable Notes and accounts payable Other payables Other payables Other payables Other payables Other payables Lease liabilities (current and non-current) Lease liabilities (current and non-current) Lease liabilities (current and non-current) Lease liabilities (current and non-current) Other current liabilities Other current liabilities Operating revenue Operating revenue Operating revenue Operating revenue Operating costs Operating costs Operating costs Operating costs Operating costs Operating costs	$ 23,998 80,109 362,727 33,322 59,322 95,724 20,243 18,662 9,413,000 3,179,000 413,000 79,568 45,184 40,832 18,512 463,978 14,040 87,839 19,853 57,806 107,007 136,709 23,496 13,528 33,027 65,928 155,456 200,317 21,833 3,041,736 5,043,666 239,396 61,055 179,116 12,941 10,676	- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -	- - - - - - - - 5% 2% - - - - - - - - - - - - - - - - - - - 2% 3% - - - - -
							(Continued)

89 -

Number	Company Name	Counterparty	Nature of Relationship (Note 1)		Transaction Details	Transaction Details	Percentage of Consolidated Total Operating Revenue or Total Assets
				Account	Amount	Transaction Terms (Note 2)
0	TWM	momo TFN TT&T TFN WMT TFN	1 1 1 1 1 1	Operating costs Operating expenses Operating expenses Other income and expenses, net Finance costs Finance costs	$ 239,239 33,348 955,450 42,157 28,852 85,298	- - - - - -	- - 1% - - -
1	TCC	TFC TFN	1 1	Other receivables Short-term borrowings	291,842 291,000	- -	- -
2	WMT	TFNM WTVB	1 1	Other receivables Other receivables	600,608 491,156	- -	- -
3	TNH	TWM	2	Operating revenue	126,354	-	-
4	TFN	TFC TFNM TWM TWM TFC TFNM momo TT&T	3 3 2 2 3 3 3 3	Notes and accounts receivable, net Notes and accounts receivable, net Lease liabilities (current and non-current) Lease revenue Operating revenue Operating revenue Operating revenue Operating expenses	25,692 34,242 35,305 38,513 153,384 217,377 44,706 99,992	- - - - - - - -	- - - - - - - -
5	TFNM	YJCTV MCTV PCTV UCTV GCTV PCTV GCTV WTVB TFN YJCTV PCTV UCTV GCTV momo YJCTV PCTV UCTV GCTV WTVB	1 1 1 1 1 1 1 3 3 1 1 1 1 3 1 1 1 1 3	Other receivables Other receivables Other receivables Other receivables Other receivables Short-term borrowings Short-term borrowings Notes and accounts payable Lease liabilities (current and non-current) Operating revenue Operating revenue Operating revenue Operating revenue Operating revenue Operating costs Operating costs Operating costs Operating costs Operating costs	40,936 17,151 59,393 33,202 21,030 520,000 250,000 17,843 57,258 405,951 523,729 215,586 189,283 44,094 34,568 39,435 23,996 16,113 73,910	- - - - - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - - - - -
							(Continued)

90 -

Number	Company Name	Counterparty	Nature of Relationship (Note 1)		Transaction Details	Transaction Details	Percentage of Consolidated Total Operating Revenue or Total Assets
				Account	Amount	Transaction Terms (Note 2)
6	momo	FSL MFS Bebe Poshe FSL MFS Prosperous Living	1 1 1 1 1 1	Notes and accounts payable Notes and accounts payable Operating costs Operating costs Operating costs Operating costs	$ 254,317 17,631 26,096 907,150 203,739 30,451	- - - - - -	- - - 1% - -
7	MFS	Prosperous Living	3	Operating revenue	10,393	-	-

Note 1: 1. Parent to subsidiary.

Subsidiary to parent.
Between subsidiaries.

Note 2: The terms of transaction are determined in accordance with mutual agreements or general business practices.

Note 3: All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation.

(Concluded)

91 -

TABLE 9

TAIWAN MOBILE CO., LTD. AND SUBSIDIARIES

INVESTMENTS IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars and Foreign Currencies)

Investee Company Name	Main Businesses and Products	Main Businesses and Products	Total Amount of Paid-in Capital	Total Amount of Paid-in Capital	Investment Type (Note 1)	Accumulated Outflow of Investment from Taiwan at the Beginning of the Period	Accumulated Outflow of Investment from Taiwan at the Beginning of the Period	Investment Flows	Investment Flows	Accumulated Outflow of Investment from Taiwan at the End of the Period	Net Income (Loss) of Investee	% Ownership through Direct or Indirect Investment	Investment Income (Loss)	Carrying Value at the End of the Period	Accumulated Inward Remittance of Earnings at the End of the Period
								Outflow	Inflow
TWMC FGE Haobo GHS	Data communication application development Wholesaling Investment Wholesaling		$ 92,175 (USD 3,000) 341,076 (RMB 77,500) 48,411 (RMB 11,000) 220,049 (RMB 50,000)		b b b b	$ 149,689 (USD 4,872) 823,012 (USD 14,000) (RMB 89,267) - -		$ - - - -	$ - - - -	$ 149,689 (USD 4,872) 823,012 (USD 14,000) (RMB 89,267) - -	$ 1,381 (4,943) (100,135) 61,451	100 76.7 100 20	$ 1,381 (3,791) (100,135) (19,073)	$ 83,402 6,976 531,879 486,008	$ - - - -

Company		Accumulated Investment in Mainland China at the End of the Period		Investment Amounts Authorized by Investment Commission, MOEA			Upper Limit on Investment Authorized by Investment Commission, MOEA (Note 2)
TWM and subsidiaries		$1,637,082 (USD18,872, RMB89,267 and HKD168,539)		$1,637,082 (USD18,872, RMB89,267 and HKD168,539)			$43,710,468

Note 1: The investment types are as follows:

a. Direct investment in mainland China.

b. Indirect investments in mainland China through subsidiaries, invested by TCC and momo, in third regions.

c. Others.

Note 2: The upper limit on investment in mainland China is calculated by 60% of the consolidated net worth.

92 -

TABLE 10

TAIWAN MOBILE CO., LTD

INFORMATION OF MAJOR STOCKHOLDERS DECEMBER 31, 2022

Name of Major Stockholder	Shares	Shares
	Number of Shares	Percentage of Ownership (%)
TUI Shin Kong Life Insurance Co., Ltd. TCCI Cathay Life Insurance Co., Ltd. Ming Dong	410,665,284 251,723,000 200,496,761 188,343,900 184,736,452	11.67 7.15 5.70 5.35 5.25

Note: The table discloses the information of major stockholders whose stockholding percentages are more than 5%. The Taiwan Depository & Clearing Corporation calculates the total number of common stocks and special stocks (including treasury stocks) that have completed the dematerialized registration and delivery on the last business day of the quarter.

93 -

Taiwan Mobile Co., Ltd.

Financial Statements for the Years Ended December 31, 2022 and 2021 and Independent Auditors’ Report

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Stockholders Taiwan Mobile Co., Ltd.

Opinion

We have audited the accompanying financial statements of Taiwan Mobile Co., Ltd. (TWM), which comprise the balance sheets as of December 31, 2022 and 2021, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and the related notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of TWM as of December 31, 2022 and 2021, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and the Standards on Auditing of the Republic of China (ROC). 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 TWM in accordance with The Norm of Professional Ethics for Certified Public Accountant of the ROC, 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, 2022. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

The descriptions of the key audit matters of the 2022 financial statements are as follows:

Telecommunications and Value-added Services Revenue

The description of key audit matter:

The primary operating revenue sources of TWM is the telecommunications and value-added services revenue. TWM offers more different monthly-fee plans and diversifies the business by innovating value-added services since the telecommunication industry becomes more competitive nowadays. The competitive telecommunication industry and complicated calculations for revenue recognition, which highly relies on automatic and systematic connection and implementation, lead the telecommunications and value-added services revenue to be considered as one of the key audit matters.

Corresponding audit procedures:

Review the contracts of mobile subscribers to ensure the accuracy of information in the accounting system.
Perform dialing tests to verify the completeness of the information in the telephone exchange system.
Perform system integration tests from telephone-exchange to telephone traffic.
Test for the accuracy of call record charge rates and billing calculations.
Verify the accuracy of the billing amounts generated from monthly rentals as well as airtime accounting systems and the transfer to the accounting information system.
Select the samples from telecommunications and value-added services revenue and agree to the contracts, bills and records of cash receipts.

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 TWM’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 TWM or to cease its operations, or has no realistic alternative but to do so.

Those charged with governance (including the audit committee) are responsible for overseeing TWM’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 Standards on Auditing of the ROC will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with the Standards on Auditing of the ROC, 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.
2 -
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of TWM’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 and is related to events or conditions that may cast significant doubt on TWM’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause TWM 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 TWM 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.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements for the year ended December 31, 2022 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

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

Deloitte & Touche Taipei, Taiwan Republic of China February 24, 2023

Notice to Readers

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

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

TAIWAN MOBILE CO., LTD.

BALANCE SHEETS (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 6 and 28) Financial assets at fair value through other comprehensive income (Note 7) Contract assets (Note 21) Notes and accounts receivable, net (Note 8) Accounts receivable due from related parties (Note 28) Other receivables (Note 28) Inventories (Note 9) Prepayments Other financial assets (Notes 28 and 29) Other current assets Total current assets NON-CURRENT ASSETS Financial assets at fair value through other comprehensive income (Note 7) Contract assets (Note 21) Investments accounted for using equity method (Notes 10 and 28) Property, plant and equipment (Note 11) Right-of-use assets (Notes 12 and 28) Investment properties (Note 13) Concessions (Note 14) Goodwill (Note 14) Other intangible assets (Note 14) Deferred tax assets (Note 23) Incremental costs of obtaining a contract (Note 21) Other non-current assets (Notes 15, 28 and 29) Total non-current assets		December 31, 2022 Amount % $ 2,177,458 1 245,607 - 5,086,808 3 6,073,211 4 527,294 - 1,357,557 1 3,616,363 2 281,205 - 31,351 - 393 - 19,397,247 11 1,915,424 1 5,390,182 3 49,249,451 29 24,806,240 15 7,968,994 5 2,922,844 2 49,744,226 29 7,121,871 4 248,785 - 346,131 - 1,793,461 1 670,609 - 152,178,218 89		December 31, 2021 Amount % $ 1,626,196 1 253,214 - 4,661,996 3 5,631,531 3 470,309 - 1,184,943 1 2,704,625 2 239,071 - 28,105 - 109 - 16,800,099 10 1,924,203 1 5,196,115 3 45,950,409 27 25,967,927 15 7,327,028 5 2,789,846 2 53,880,810 32 7,121,871 4 232,048 - 435,187 - 1,710,107 1 646,910 - 153,182,461 90

TOTAL $ 171,575,465 100 $ 169,982,560 100

LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 16 and 28) Short-term notes and bills payable (Note 16) Contract liabilities (Note 21) Accounts payable Accounts payable due to related parties (Note 28) Other payables (Note 28) Current tax liabilities Provisions (Note 18) Lease liabilities (Notes 12, 25 and 28) Long-term liabilities, current portion (Notes 16 and 17) Other current liabilities (Note 28) Total current liabilities NON-CURRENT LIABILITIES Contract liabilities (Note 21) Bonds payable (Note 17) Long-term borrowings (Note 16) Provisions (Note 18) Deferred tax liabilities (Note 23) Lease liabilities (Notes 12, 25 and 28) Net defined benefit liabilities (Note 19) Guarantee deposits Other non-current liabilities Total non-current liabilities Total liabilities EQUITY (Note 20) Common stock Capital collected in advance Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Other equity interests Treasury stock Total equity TOTAL		December 31, 2022 Amount % $ 32,305,000 19 3,092,395 2 1,118,225 1 1,922,613 1 287,947 - 7,595,865 4 904,881 1 30,473 - 3,018,613 2 9,499,226 5 2,361,856 1 62,137,094 36 60,255 - 31,481,943 18 4,496,902 3 511,229 - 783,982 1 4,977,758 3 76,985 - 431,651 - 2,146,910 1 44,967,615 26 107,104,709 62 35,192,336 21 - - 15,326,778 9 32,603,345 19 1,823,415 1 8,954,012 5 288,214 - (29,717,344) (17) 64,470,756 38 $ 171,575,465 100		December 31, 2021
				Amount % $ 30,331,000 18 4,597,793 3 1,066,995 1 1,894,432 1 294,026 - 8,060,985 5 931,555 - 35,997 - 2,937,829 2 - - 2,133,401 1 52,284,013 31 60,699 - 37,475,497 22 6,497,809 4 517,815 - 703,734 - 4,406,338 3 296,667 - 402,551 - 1,803,684 1 52,164,794 30 104,448,807 61 35,135,201 21 57,135 - 16,903,239 10 31,500,472 19 2,449,739 1 11,028,726 6 (1,823,415) (1) (29,717,344) (17) 65,533,753 39 $ 169,982,560 100

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

TAIWAN MOBILE CO., LTD.

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUES (Notes 21 and 28) OPERATING COSTS (Notes 9, 28 and 32) GROSS PROFIT FROM OPERATIONS, NET OPERATING EXPENSES (Notes 28 and 32) Marketing Administrative Research and development Expected credit loss Total operating expenses OTHER INCOME AND EXPENSES, NET (Note 28) OPERATING INCOME NON-OPERATING INCOME AND EXPENSES Interest income Other income Other gains and losses, net (Note 22) Finance costs (Notes 22 and 28) Share of profit of subsidiaries and associates accounted for using equity method (Note 10) Total non-operating income and expenses PROFIT BEFORE TAX INCOME TAX EXPENSE (Note 23) NET PROFIT OTHER COMPREHENSIVE INCOME (LOSS) (Notes 10, 19, 20 and 23) Items that will not be reclassified subsequently to profit or loss: Remeasurements of defined benefit plans Unrealized gain on investments in equity instruments at fair value through other comprehensive income Share of other comprehensive income (loss) of subsidiaries and associates accounted for using equity method Items that may be reclassified subsequently to profit or loss: Share of other comprehensive income (loss) of subsidiaries and associates accounted for using equity method Other comprehensive income (after tax) TOTAL COMPREHENSIVE INCOME EARNINGS PER SHARE (Note 24) Basic earnings per share Diluted earnings per share		2022 Amount % $ 61,027,806 100 46,231,648 76 14,796,158 24 6,568,252 11 2,798,333 5 149,108 - 255,814 - 9,771,507 16 612,089 1 5,636,740 9 22,032 - 36,864 - (246,898) - (755,256) (1) 7,239,387 12 6,296,129 11 11,932,869 20 907,318 2 11,025,551 18 162,294 - 175,367 - (311,300) - 16,432 - 42,793 - $ 11,068,344 18 $ 3.91 $ 3.90		2021
				Amount % $ 59,844,804 100 44,797,460 75 15,047,344 25 6,666,554 11 2,889,750 5 31,904 - 224,288 - 9,812,496 16 585,942 1 5,820,790 10 5,929 - 12,900 - (15,325) - (646,976) (1) 6,493,099 11 5,849,627 10 11,670,417 20 682,252 2 10,988,165 18 7,213 - 135,246 - 544,692 1 (12,615) - 674,536 1 $ 11,662,701 19 $ 3.90 $ 3.89

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

TAIWAN MOBILE CO., LTD.

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

Capital Collected in Common Stock Advance Capital Surplus BALANCE, JANUARY 1, 2021 $ 35,124,215 $ - $ 18,936,574 Distribution of 2020 earnings Legal reserve - - - Special reserve - - - Cash dividends - - - Total distribution of earnings - - - Cash dividends from capital surplus - - (2,577,603) Profit for the year ended December 31, 2021 - - - Other comprehensive income (loss) for the year ended December 31, 2021 - - - Total comprehensive income (loss) for the year ended December 31, 2021 - - - Conversion of convertible bonds to common stock 10,986 57,135 557,944 Disposal of investments in equity instruments designated as at fair value through other comprehensive income - - - Changes in equity of associates accounted for using equity method - - 6,399 Disposal of investments accounted for using equity method - - (21,913) Other changes in capital surplus - - 1,838 BALANCE, DECEMBER 31, 2021 35,135,201 57,135 16,903,239 Distribution of 2021 earnings Legal reserve - - - Reversal of special reserve - - - Cash dividends - - - Total distribution of earnings - - - Cash dividends from capital surplus - - (1,576,086) Profit for the year ended December 31, 2022 - - - Other comprehensive income (loss) for the year ended December 31, 2022 - - - Total comprehensive income (loss) for the year ended December 31, 2022 - - - Conversion of convertible bonds to common stock 57,135 (57,135) - Transfer and disposal of investments in equity instruments designated as at fair value through other comprehensive income - - - Difference between consideration and carrying amount of subsidiaries acquired - - - Changes in equity of associates accounted for using equity method - - - Changes in equity associated with non-current assets held for sale - - (2,223) Other changes in capital surplus - - 1,848 BALANCE, DECEMBER 31, 2022 $ 35,192,336 $ - $ 15,326,778		Retained Earnings Unappropriated Legal Reserve Special Reserve Earnings $ 30,170,398 $ - $ 13,300,996 1,330,074 - (1,330,074) - 2,449,739 (2,449,739) - - (9,521,178) 1,330,074 2,449,739 (13,300,991) - - - - - 10,988,165 - - 28,385 - - 11,016,550 - - - - - (2,209) - - (8,505) - - 22,885 - - - 31,500,472 2,449,739 11,028,726 1,102,873 - (1,102,873) - (626,324) 626,324 - - (10,551,987) 1,102,873 (626,324) (11,028,536) - - - - - 11,025,551 - - 258,116 - - 11,283,667 - - - - - (2,326,952) - - (2,140) - - (753) - - - - - - $ 32,603,345 $ 1,823,415 $ 8,954,012	Other Equity Interests Exchange Unrealized Gain (Loss) on Financial Assets at Fair Value Through Other Differences on Comprehensive Translation Income Treasury Stock $ (31,679) $ (2,418,060) $ (29,717,344) - - - - - - - - - - - - - - - - - - (12,615) 658,766 - (12,615) 658,766 - - - - - 2,209 - - 849 - - (22,885) - - - - (44,294) (1,779,121) (29,717,344) - - - - - - - - - - - - - - - - - - 16,432 (231,755) - 16,432 (231,755) - - - - - 2,326,952 - - - - - - - - - - - - - $ (27,862) $ 316,076 $ (29,717,344)	Total Equity $ 65,365,100 - - (9,521,178) (9,521,178) (2,577,603) 10,988,165 674,536 11,662,701 626,065 - (1,257) (21,913) 1,838 65,533,753 - - (10,551,987) (10,551,987) (1,576,086) 11,025,551 42,793 11,068,344 - - (2,140) (753) (2,223) 1,848 $ 64,470,756

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

TAIWAN MOBILE CO., LTD.

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments for: Share of profit of subsidiaries and associates accounted for using equity method Depreciation expense Amortization expense Amortization of incremental costs of obtaining a contract Loss on disposal and retirement of property, plant and equipment, net Gain on disposal of property, plant and equipment held for sale Gain on disposal of investments accounted for using equity method Expected credit loss Other income and expenses Finance costs Interest income Dividend income Others Changes in operating assets and liabilities Contract assets Notes and accounts receivable Accounts receivable due from related parties Other receivables Inventories Prepayments Other current assets Other financial assets Incremental costs of obtaining a contract Contract liabilities Accounts payable Accounts payable due to related parties Other payables Provisions Other current liabilities Net defined benefit liabilities Cash inflows generated from operating activities Interest received Interest paid Income taxes paid Net cash generated from operating activities	2022 $ 11,932,869 (7,239,387) 9,382,810 4,348,013 1,200,756 222,543 (1,014) - 255,814 (462,936) 755,256 (22,032) (10,016) (3,320) (624,185) (696,114) (56,985) (209,506) (911,738) (55,569) (284) (3,246) (1,284,110) 50,786 28,181 (6,079) (92,297) (30,706) 228,455 (16,815) 16,679,144 2,542 (275) (909,884) 15,771,527	2021 $ 11,670,417 (6,493,099) 9,243,700 4,355,353 1,302,825 24,041 - (29) 224,288 (217,817) 646,976 (5,929) (9,359) (2,283) (1,508,966) (588,351) 17,061 (11,196) (336,609) 23,333 (75) 8,409 (1,341,309) (64,091) 72,260 79,255 431,357 (134,544) (9,593) (17,023) 17,359,002 1,160 (275) (908,227) 16,451,660

(Continued)

TAIWAN MOBILE CO., LTD.

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of property, plant and equipment Acquisition of right-of-use assets Acquisition of intangible assets Increase in prepayments for equipment Proceeds from disposal of property, plant and equipment Proceeds from disposal of property, plant and equipment held for sale Proceeds from disposal of intangible assets Cash outflow on acquisition of subsidiaries Acquisition of financial assets at fair value through other comprehensive income Transfer of financial assets at fair value through other comprehensive income Disposal of investments accounted for using equity method Other investing activities Increase in refundable deposits Decrease in refundable deposits Interest received Dividends received from subsidiaries Other dividends received Net cash generated from (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term borrowings Borrowings from related parties Repayments of borrowings from related parties Decrease in short-term notes and bills payable Proceeds from issue of bonds Repayments of bonds Proceeds from long-term borrowings Repayment of long-term borrowings Repayment of the principal portion of lease liabilities Increase in guarantee deposits received Decrease in guarantee deposits received Cash dividends paid Interest paid Net cash used in financing activities NET INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT END OF THE YEAR	2022 $ (5,517,350) (25,108) (145,231) (75,539) 295 2,715 10,000 (2,130,000) (375,000) 671,375 667 822,538 (148,123) 133,128 16,713 5,770,361 10,016 (978,543) 500,000 15,791,000 (14,317,000) (1,508,125) - - 4,499,798 (3,002,712) (3,386,907) 93,587 (66,229) (12,128,013) (717,121) (14,241,722) 551,262 1,626,196 $ 2,177,458	2021 $ (7,757,835) (30,197) (153,295) (122,603) 127,380 - 12,800 (570,000) - - 7,830 2,140,688 (152,556) 132,812 1,657 7,137,500 9,359 783,540 9,000,000 15,496,000 (16,435,000) (9,591,635) 2,496,465 (10,700) - (2,007,757) (3,394,255) 82,292 (52,050) (12,098,704) (635,839) (17,151,183) 84,017 1,542,179 $ 1,626,196

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

(Concluded)

NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

TAIWAN MOBILE CO., LTD.

1. ORGANIZATION AND OPERATIONS

2. APPROVAL OF THE FINANCIAL STATEMENTS

The Board of Directors approved the financial statements on February 24, 2023.

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

a. Application of the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC)

Application of the IFRSs endorsed and issued into effect by the FSC did not have any material impact on TWM’s accounting policies.

b. The IFRSs issued by International Accounting Standards Board (IASB) and endorsed by the FSC for application starting from 2023

New IFRSs 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 Announced by IASB
	January 1, 2023 (Note 1) January 1, 2023 (Note 2) January 1, 2023 (Note 3)

10 -
Note 1: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.
Note 2: The amendments are applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.
Note 3: Except that deferred taxes will be recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments were applied prospectively to transactions that occur on or after January 1, 2022.

As of the date the financial statements were authorized for issue, TWM had assessed that the application of above standards and interpretations would not have a material impact on TWM’s financial position and financial performance.

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

Effective Date New IFRSs Announced by IASB (Note 1) Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets To be determined by IASB between An Investor and Its Associate or Joint Venture” Amendments to IFRS 16 “Leases Liability in a Sale and Leaseback” January 1, 2024 (Note 2) Amendments to IAS 1 “Classification of Liabilities as Current or January 1, 2024 Non-current” Amendments to IAS 1 “Non-current Liabilities with Covenants” January 1, 2024

Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.
Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and leaseback transactions entered into after the date of initial application of IFRS 16.

As of the date the financial statements were authorized for issue, TWM is continuously assessing the impact that the application of above standards and interpretations will have on TWM’s financial position and financial performance and will disclose the relevant impact when the assessment is completed.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Statement of Compliance

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

Basis of Preparation

a. Basis of measurement

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

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When preparing the parent company only financial statements, TWM accounts for subsidiaries and associates by using the equity method. In order to agree with the amount of net income, other comprehensive income and equity attributable to owners of the parent in the consolidated financial statements, the differences of the accounting treatment between the parent company only basis and the consolidated basis are adjusted under the heading of investments accounted for using equity method, share of profits of subsidiaries and associates and share of other comprehensive income of subsidiaries and associates in the parent company only financial statements.

b. Functional and presentation currency

The functional currency of each individual entity is determined based on the primary economic environment in which the entity operates. The financial statements are presented in New Taiwan dollars (NTD), which is TWM’s functional currency.

Foreign Currencies

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.

When preparing the financial statements, the assets and liabilities of foreign operations are translated to NTD using the exchange rates at the end of the reporting period. The income and expenses of foreign operations are translated at the average exchange rate for the period. Exchange differences are recognized in other comprehensive income.

On the disposal of TWM’s entire interest in a foreign operation, all of the exchange differences accumulated in equity in respect of that operation are reclassified to profit or loss.

Classification of Current and Non-current Assets and Liabilities

TWM classifies an asset as current when any one of the following requirements is met. Assets that are not classified as current are non-current assets.

a. It holds the asset primarily for the purpose of trading;
b. It expects to realize the asset within twelve months after the reporting period; or
c. The asset is cash or a cash equivalent unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
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TWM classifies a liability as current when any one of the following requirements is met. Liabilities that are not classified as current are non-current liabilities.

a. It holds the liability primarily for the purpose of trading;
b. The liability is due to be settled within twelve months after the reporting period; or
c. It does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

Financial Instruments

Financial assets and financial liabilities are recognized in the balance sheets when TWM becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss (FVTPL)) 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 FVTPL are recognized immediately in profit or loss.

a. Financial assets

TWM adopts trade-date accounting to recognize and derecognize financial assets.

1) Measurement category

Financial assets are classified into the following categories: financial assets at amortized cost and investments in equity instruments at fair value through other comprehensive income (FVTOCI).

a) 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.

Interest income is calculated by applying the effective interest rate to the amortized cost of the financial asset.

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b) Investments in equity instruments at FVTOCI

On initial recognition, TWM 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.

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

2) Impairment of financial assets and contract assets

TWM recognizes a loss allowance for expected credit losses (ECLs) on financial assets at amortized cost (including receivables) and contract assets.

For internal credit risk management purposes, TWM determines that the following situations indicate that a financial asset is in default (without taking into account any collateral held by TWM):

a) Internal or external information shows that the debtor is unlikely to pay its creditors.
b) Failure to meet the obligation associated with liabilities within the credit terms.

TWM recognizes an impairment loss in profit or loss for aforementioned financial instruments and contract assets with a corresponding adjustment to their carrying amount through a loss allowance account.

3) Derecognition of financial assets

TWM derecognizes financial assets only when the contractual rights of 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.

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On derecognition of investments in equity instruments at FVTOCI, the cumulative gain or loss is directly transferred to retained earnings, and is not reclassified to profit or loss.

b. Equity instruments

Equity instruments issued by TWM are recognized at the proceeds received, net of direct issue costs.

c. Financial liabilities
1) Recognition

2) Convertible bonds

3) Derecognition of financial liabilities

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d. Derivative financial instruments

Inventories

Non-current Assets Held for Sale

Assets classified as non-current assets held for sale are measured at the lower of the carrying amount and fair value less costs to sell, and should not be depreciated.

Investment in Associates

An associate is an entity in which TWM has significant influence, but is neither a subsidiary nor an interest in a joint venture. TWM applies the equity method to account for its investments in associates.

Investments in associates are accounted for using equity method and are recognized initially at cost. The cost of the investment includes transaction costs. The carrying amount of the investment in associates includes goodwill arising from the acquisition less any accumulated impairment losses. Goodwill is not amortized. Any excess of TWM’s share of the net fair value of the identifiable assets and liabilities over the cost of acquisition, is recognized immediately in profit or loss after reassessment. The entire carrying amount of an investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is not allocated to any asset, including goodwill, which 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 financial statements include TWM’s share of the profit or loss and other comprehensive income (loss) of equity-accounted investees, after adjustments to align their accounting policies with those of TWM, from the date that significant influence commences until the date that significant influence ceases.

When TWM’s share of losses of an associate equals or exceeds its interest in that associate, TWM discontinues recognizing its share of further losses. Additional losses and liabilities are recognized only to the extent that TWM has incurred legal obligations, or constructive obligations, or made payments on behalf of that associate.

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When TWM 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 TWM’s proportionate interest in the associate. TWM 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 TWM’s ownership interest is reduced due to its disproportionate 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 had the investee directly disposed of the related assets or liabilities. When the adjustment should be debited to capital surplus, but the capital surplus recognized from investments accounted for using the equity method is insufficient, the shortage is debited to retained earnings.

When TWM loses significant influence over an associate, it recognizes the investment retained in the former associate at its fair value at the date when significant influence is lost. The difference between the fair value of the investment plus consideration received and the carrying amount of the previous investment at the date when significant influence is lost is recognized as a gain or loss in profit or loss. Besides this, TWM accounts for all amounts previously recognized in other comprehensive income in relation to that associate on the same basis as would be required if TWM had directly disposed of the related assets or liabilities.

If TWM decreased the percentage of the ownership of associate due to disposal but still accounts for its investments in associate, it should reclassify the amount previously recognized in other comprehensive income to profit or loss proportionally.

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

Investments in Subsidiaries

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

Under the equity method, an investment in a subsidiary is initially recognized at cost and adjusted thereafter to recognize TWM’s share of the profit or loss and other comprehensive income of the subsidiary. TWM also recognizes the changes in TWM’s share of equity of subsidiaries. The profit or loss and other comprehensive income presented in the parent company only financial reports will be the same as the allocations of profit or loss and of other comprehensive income attributable to owners of the parent presented in the financial reports prepared on a consolidated basis, and the owners’ equity presented in the parent company only financial reports will be the same as the equity attributable to owners of the parent presented in the financial reports prepared on a consolidated basis.

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

When TWM loses control of a subsidiary, it recognizes the investment retained in the former subsidiary at its fair value at the date when control is lost. The difference between the fair value of the retained investment plus any consideration received and the carrying amount of the previous investment at the date when control is lost is recognized as a gain or loss in profit or loss. Besides this, TWM shall account for all amounts previously recognized in other comprehensive income in relation to that subsidiary on the same basis as would be required if TWM had directly disposed of the related assets or liabilities.

Profits or losses resulting from downstream transactions are eliminated in full only in the parent company’s financial statements. Profits and losses resulting from upstream transactions and transactions between subsidiaries are recognized only in the parent company’s financial statements only to the extent of interests in the subsidiaries that are not related to TWM.

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Property, Plant and Equipment

Subsequent expenditure is capitalized only when it is probable that the future economic benefits associated with the expenditure will flow to TWM and the amount can be reliably measured. The carrying amount of those parts that are replaced is derecognized. Ongoing repairs and maintenance are expensed as incurred.

Leases

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

a. TWM as lessor

Leases in which the lessee assumes substantially all of the risks and rewards of ownership are classified as finance leases. All other leases are classified as operating leases.

When TWM subleases a right-of-use asset, the sublease is classified by reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset.

Under finance leases, the lease payments comprise fixed payments and in-substance fixed payments. The net investment in a lease is measured at the present value of the sum of the lease payments receivable by a lessor and is presented as a finance lease receivable. Finance lease income is allocated to the relevant accounting periods so as to reflect a constant, periodic rate of return on TWM’s net investment outstanding in respect of leases.

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

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When a lease includes both land and building elements, TWM assesses the classification of each element separately as a finance or an operating lease based on the assessment as to whether substantially all the risks and rewards incidental to ownership of each element have been transferred to the lessee. The entire lease is classified as an operating lease when it is clear that both elements are operating leases.

b. TWM as lessee

TWM 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.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in a lease term or a change in future lease payments resulting from a change in an index used to determine those payments, TWM remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. For a lease modification, TWM accounts for the remeasurement of the lease liability by (a) adjusting the carrying amount of the right-of-use asset of lease modifications that adjust the scope and the term of the lease, and recognizes in profit or loss any gain or loss on the partial or full termination of the lease and (b) making a corresponding adjustment to the right-of-use asset of all other lease modifications. TWM also accounts for the rent concessions as lease modifications if the rent payments due by June 30, 2022 were adjusted due to the COVID-19 pandemic. Lease liabilities are presented on a separate line in the balance sheets.

Variable lease payments that do not depend on an index are recognized as expenses in the periods in which they are incurred.

Investment Properties

Intangible Assets

a. Goodwill

Goodwill acquired in a business combination is recognized at the acquisition date, and is measured at cost less accumulated impairment losses.

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b. Other intangible assets

c. Amortization and derecognition of intangible assets

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.

Incremental Costs of Obtaining a Contract

Only when a contract is obtained, sales commissions and subsidies of telecommunication services are recognized as incremental costs of obtaining a contract to the extent the amounts are expected to be recovered, and are amortized on a straight-line basis over the life of the contract. However, TWM elects not to capitalize the incremental costs of obtaining a contract if the amortization period of the assets that TWM otherwise would have recognized is expected to be one year or less.

Impairment of Non-financial Assets

a. Goodwill

b. Property, plant, and equipment, right-of-use assets, investment properties, intangible assets (excluding goodwill), and incremental costs of obtaining a contract

At the end of each reporting period, TWM reviews the carrying amounts of those 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, TWM estimates the recoverable amount of the cash-generating unit to which the asset belongs. Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate.

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Provisions

A provision is recognized if, as a result of a past event, TWM has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows that reflects the current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as a finance cost.

a. Restoration

The restoration costs for telecommunications equipment and leasehold improvements that were originally acquired or used by TWM for a period of time and had obligations for dismantling, relocating, and restoring to the previous state should be recognized as an addition to the assets and accrued as a potential liability accordingly.

b. Warranties

Treasury Stock

Government Grants

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

Government grants related to income are recognized in profit or loss on a systematic basis over the periods in which TWM recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that TWM should purchase, construct or otherwise acquire non-current assets are recognized as deferred revenue and transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets; or recognized as a book value deduction of the non-current assets and classified as profit or loss within their useful lives through deducting depreciation expenses of the related non-current assets.

Government grants that are receivable as compensation for expenses or losses already incurred are recognized in profit or loss in the period in which they become receivable.

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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.

Obligations for contributions to defined contribution pension plans are recognized as an expense in profit or loss in the periods during which services are rendered by employees.

Net defined benefit liability (asset) represents the deficit (surplus) of defined benefit plans. IAS 19 requires TWM to limit the carrying amount of a net defined benefit asset so that it does not exceed the economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan.

A liability for a termination benefit is recognized at the earlier of when TWM can no longer withdraw the offer of the termination benefit and when TWM recognizes any related restructuring costs.

Income Tax

a. Current taxes

Current taxes include tax payables and tax deduction receivables on taxable gains (losses), as well as tax adjustments related to prior years.

b. Deferred taxes

Deferred taxes arise due to temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax basis. Deferred tax assets are generally recognized for all deductible temporary differences, unused tax credits for purchases of machinery, equipment and technology, and research and development expenditures to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized. Deferred tax liabilities are generally recognized for all taxable temporary differences.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments, except where TWM 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 profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future.

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Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the end of the reporting period. The measurement reflects TWM’s expectations at the end of the reporting period as to the manner in which the carrying amount of its assets and liabilities will be recovered or settled.

Revenue Recognition

Where TWM enters into transactions which involve both the provision of telecommunications service bundled with products such as handsets, total consideration received from products and telecommunications service in these arrangements is allocated based on their relative stand-alone selling price. The amount of sales revenue recognized for products is not limited to the amount paid by the customer for the products at the time of purchase. When the amount of sales revenue recognized for products exceeds the amount paid by the customer for the products, the difference is recognized as a contract asset. A contract asset is derecognized and an account receivable is recognized when the amount becomes collectible from the customer subsequently. When the amount of sales revenue recognized for products is less than the amount paid by the customer for the products, the difference is recognized as contract liabilities and the revenue is recognized subsequently when the telecommunications service is provided.

The deferred revenue allocated to the customer loyalty program is estimated at fair value. Transaction price allocated is recognized as contract liabilities when collected and will be recognized as revenue when the performance obligations are fulfilled.

Service revenues from mobile communication services are billed at predetermined rates and calculated based on the actual volume of voice call and data transfer. Revenues from postpaid users are accrued monthly. Revenues from prepaid users are recognized based on the actual usage. The advanced receipts obtained before services are rendered are recognized as contract liabilities and reclassified as revenues when services are rendered. Interconnection and call transfer fees from other telecommunications companies and carriers are billed and recognized based upon seconds or minutes of traffic processed when the services are provided in accordance with contract terms. The usage revenues and corresponding trade notes and accounts receivable are recognized monthly.

Revenues from sale of goods are mainly generated from physical stores and e-commerce platform. Revenues are recognized when the goods are transferred or delivered to the customers. Advance receipts obtained before goods are transferred or delivered are recognized as contract liabilities, and reclassified as revenue when the goods are transferred or delivered.

Service revenues generated from contractual agreements are recognized as revenue as services are rendered based on the completion of the contracts and TWM does not have any further obligations. In addition, when TWM is acting as an agent in the transaction, proportional revenue is recognized based on the net amount in accordance with the contractual agreements proportionally.

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

The preparation of the financial statements requires management to make judgments, estimates and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates.

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The management will continually review the estimates and basic assumptions. The impact of changes in accounting estimates will be recognized in the period of change and the future period impacted.

Critical Accounting Judgments

a. Lease terms

In determining a lease term, TWM considers all facts and circumstances that create an economic incentive to exercise or not to exercise an option, including any expected changes in facts and circumstances from the commencement date until the exercise date of the option. Main factors considered include contractual terms and conditions for the optional periods, significant leasehold improvements undertaken over the contract term, the importance of the underlying asset to the lessee’s operations, etc. The lease term is reassessed if a significant change in circumstances that are within control of TWM occurs.

b. Timing of revenue recognition

TWM recognizes revenue when the performance obligations are satisfied over time or at a point in time according to the contracts with customers. The conditions are described in Note 4.

Key Sources of Estimation Uncertainty

a. Impairment of notes and accounts receivable and contract assets

The provision for impairment of notes and accounts receivable and contract assets is based on assumptions about risk of default and expected loss rates. TWM uses judgment in making these assumptions and in selecting the inputs to the impairment calculation, based on the past default records of the customers and an analysis of the customers’ current financial positions, as well as forward-looking indicators. For details of the key assumptions and inputs used, see Note 8.

b. Provision for inventory valuation and obsolescence

c. Impairment of goodwill

d. Impairment of property, plant, and equipment, right-of-use assets, investment properties, intangible assets (excluding goodwill), and incremental costs of obtaining a contract

In the process of impairment assessments, TWM relies on subjective judgment to determine the individual cash flows of a specific group of assets and estimates future gains and losses according to the usage of the assets and relevant business characteristics. Alterations of estimates from any changes in economic conditions or business strategy may lead to significant impairment losses in the future.

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6. CASH AND CASH EQUIVALENTS

December 31 2022 2021 Cash on hand and revolving funds $ 80,905 $ 111,334 Cash in banks 2,096,553 1,514,862 $ 2,177,458 $ 1,626,196 FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME December 31 2022 2021 Investments in equity instruments-current Domestic investments Listed stocks $ 245,607 $ 253,214 Investments in equity instruments-non-current Domestic investments Listed stocks $ - $ 798,745 Unlisted stocks 674,999 408,139 Foreign investments Unlisted stocks 30,137 27,672 Limited partnerships 1,210,288 689,647 $ 1,915,424 $ 1,924,203		December 31	December 31
		2022 $ 245,607 $ - 674,999 30,137 1,210,288 $ 1,915,424	2021 $ 253,214 $ 798,745 408,139 27,672 689,647 $ 1,924,203

7. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

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 believed that recognizing short-term fluctuations from these investments’ fair value in profit or loss would not be consistent with TWM’s strategy of holding these investments for long-term purposes.

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8. NOTES AND ACCOUNTS RECEIVABLE, NET

Notes receivable Accounts receivable Less: Allowance for impairment loss		December 31	December 31
		2022 $ 226 6,452,753 (379,768) $ 6,073,211	2021 $ 166 5,955,414 (324,049) $ 5,631,531

The main credit terms range from 30 to 90 days.

TWM serves a large consumer base for its telecommunications business; therefore, the concentration of credit risk is limited. When entering into transactions with customers, TWM considers the record of arrears in the past. In addition, TWM may also collect some telecommunication charges in advance to reduce the risk of payment arrears in subsequent periods.

TWM adopted a policy of only trading with corporate counterparties with a considerable scale of operations, certain credit ratings and financial conditions for telecommunications service and products. In addition to examining publicly available financial information and its own historical transaction experience, TWM obtains collateral where necessary to mitigate the risk of loss arising from default. TWM continues to monitor the credit exposure and financial and credit conditions of its counterparties, and spreads the total amount of the transactions among qualified counterparties.

In order to mitigate credit risk, the management of TWM has delegated a team responsible for determining credit limits, credit approvals and other monitoring procedures to ensure the recoverability of receivables. In addition, TWM reviews the recoverable amount of trade receivables at balance sheet dates to ensure that adequate allowance is provided for possible irrecoverable amounts. In this regard, the management believes TWM’s credit risk could be reasonably reduced.

TWM measures the loss allowance for trade receivables at an amount equal to lifetime ECLs. The ECLs on trade receivables are estimated using a provision matrix approach considering the past default records of the customers and an analysis of the customers’ current financial positions, as well as forward-looking indicators such as the change rates of consumer price index and economic leading indicators. As TWM’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision matrix does not distinguish customer segments. As a result, the expected credit loss rate is based on the number of past due days of trade receivables.

TWM writes off a trade receivable when there is evidence indicating that the counterparty is in severe financial difficulty and the trade receivable is considered uncollectible. For trade receivables that have been written off, TWM continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are recognized in profit or loss.

Movements of the allowance for doubtful notes and accounts receivable by individual and collective assessment were as follows:

December 31, 2022

Not Past Due Gross carrying amount $ 5,711,122 Loss allowance (Lifetime ECLs) (53,144) Amortized cost $ 5,657,978	Overdue 1 to 120 Days 121 to 365 Days Over 365 Days $ 562,562 $ 179,295 $ - (156,482) (170,142) - $ 406,080 $ 9,153 $ -	Total $ 6,452,979 (379,768) $ 6,073,211

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December 31, 2021

Not Past Due Gross carrying amount $ 5,341,520 Loss allowance (Lifetime ECLs) (50,526) Amortized cost $ 5,290,994	Overdue 1 to 120 Days 121 to 365 Days Over 365 Days $ 458,730 $ 155,263 $ 67 (125,336) (148,120) (67) $ 333,394 $ 7,143 $ -	Total $ 5,955,580 (324,049) $ 5,631,531

Expected credit loss rates of TWM for the aforementioned periods were as follows:

	Not Past Due
	and Past Due	Past Due Over
	within 120 Days	120 Days
Telecommunications services	0.85%-85%	89.47%-100%

Movements of the loss allowance of notes and accounts receivable were as follows:

Beginning balance Add: Provision Recovery Less: Write-off Ending balance	For the Year Ended	For the Year Ended	December 31
		2022 $ 324,049 250,505 43,969 (238,755) $ 379,768	2021 $ 287,106 211,460 40,496 (215,013) $ 324,049

TWM entered into an accounts receivable factoring contract with a private institution and sold those overdue accounts receivable that had been written off. Under the contract, TWM would no longer assume the risk on the receivables. The related factored accounts receivable information was as follows:

Amount of accounts receivable sold Proceeds from the sale of accounts receivable	For the Year Ended	For the Year Ended	December 31
		2022 $ 608,099 $ 60,077	2021 $ 716,557 $ 58,033

9. INVENTORIES

Merchandise Materials for maintenance		December 31	December 31
		2022 $ 3,605,049 11,314 $ 3,616,363	2021 $ 2,696,008 8,617 $ 2,704,625

For the years ended December 31, 2022 and 2021, the cost of goods sold related to inventories amounted to $20,472,303 thousand and $20,350,441 thousand, respectively, which included the inventory write-down totaling $38,672 thousand, and the reversal of inventory write-down totaling $34,028 thousand, respectively.

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10. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

Subsidiaries Associates AppWorks Ventures Co., Ltd. (AppWorks)		December 31	December 31
		2022 $ 49,004,706 244,745 $ 49,249,451	2021 $ 45,679,412 270,997 $ 45,950,409

a. Subsidiaries

Please refer to the consolidated financial statements for the year ended December 31, 2022.

b. Associates

Aggregate information of associates that were not individually material:

TWM’s share of: Profit (loss) Other comprehensive income (loss) Comprehensive income (loss)		December	31
		2022 $ (10,213) (16,039) $ (26,252)	2021 $ 3,337 2,016 $ 5,353

1) AppWorks

2) Alliance Digital Tech Co., Ltd. (ADT)

In November 2013, TWM acquired 19.23% equity interest of ADT.

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11. PROPERTY, PLANT AND EQUIPMENT

Cost Balance, January 1, 2022 Additions Disposals and retirements Reclassification Balance, December 31, 2022 Accumulated depreciation and impairment Balance, January 1, 2022 Depreciation Disposals and retirements Reclassification Balance, December 31, 2022 Carrying amount, December 31, 2022 Cost Balance, January 1, 2021 Additions Disposals and retirements Reclassification Balance, December 31, 2021 Accumulated depreciation and impairment Balance, January 1, 2021 Depreciation Disposals and retirements Reclassification Balance, December 31, 2021 Carrying amount, December 31, 2021	Land $ 3,380,757 - - (123,643) $ 3,257,114 $ - - - - $ - $ 3,257,114 $ 3,381,179 - (10,637 ) 10,215 $ 3,380,757 $ - - - - $ - $ 3,380,757	Buildings Telecommuni- cations Equipment and Machinery $ 2,066,502 $ 81,085,703 - 16,830 - (1,512,503 ) (52,241) 3,957,760 $ 2,014,261 $ 83,547,790 $ 999,274 $ 60,839,515 37,944 5,613,646 - (1,292,071 ) (21,022) - $ 1,016,196 $ 65,161,090 $ 998,065 $ 18,386,700 $ 2,074,774 $ 75,308,599 - 11,999 (10,645 ) (1,638,551 ) 2,373 7,403,656 $ 2,066,502 $ 81,085,703 $ 971,558 $ 56,939,439 37,920 5,419,077 (4,762 ) (1,519,022 ) (5,442) 21 $ 999,274 $ 60,839,515 $ 1,067,228 $ 20,246,188	Others Construction in Progress and Equipment to be Inspected $ 5,355,422 $ 647,328 174,282 4,961,677 (1,350,136 ) (382 ) 45,396 (4,003,156) $ 4,224,964 $ 1,605,467 $ 4,728,996 $ - 285,186 - (1,348,112 ) - - - $ 3,666,070 $ - $ 558,894 $ 1,605,467 $ 5,256,078 $ 1,686,184 181,106 6,387,482 (94,633 ) (9,811 ) 12,871 (7,416,527) $ 5,355,422 $ 647,328 $ 4,468,201 $ - 349,888 - (89,072 ) - (21) - $ 4,728,996 $ - $ 626,426 $ 647,328	Total $ 92,535,712 5,152,789 (2,863,021 ) (175,884) $ 94,649,596 $ 66,567,785 5,936,776 (2,640,183 ) (21,022) $ 69,843,356 $ 24,806,240 $ 87,706,814 6,580,587 (1,764,277 ) 12,588 $ 92,535,712 $ 62,379,198 5,806,885 (1,612,856 ) (5,442) $ 66,567,785 $ 25,967,927

Property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives as follows:

Buildings Primary buildings 50-55 years Mechanical and electrical equipment 15 years Telecommunications equipment and machinery 1-15 years Others 2-15 years

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12. LEASE ARRANGEMENTS

a. Right-of-use assets

Carrying amount Land Buildings Telecommunications equipment and machinery Others Additions to right-of-use assets Depreciation charge for right-of-use assets Land Buildings Telecommunications equipment and machinery Others		December 31	December 31
	2022 2021 $ 609,210 $ 490,448 7,079,502 6,468,835 210,044 274,127 70,238 93,618 $ 7,968,994 $ 7,327,028 For the Year Ended December 31
		2022 $ 4,304,657 $ 235,148 3,065,596 87,059 38,068 $ 3,425,871	2021 $ 3,491,135 $ 227,863 3,063,044 86,152 39,497 $ 3,416,556

Except for the aforementioned additions and recognized depreciation, TWM did not have significant sublease or impairment of right-of-use assets during the years ended December 31, 2022 and 2021.

b. Lease liabilities

Carrying amount Current Non-current		December 31	December 31
		2022 $ 3,018,613 $ 4,977,758	2021 $ 2,937,829 $ 4,406,338

Range of discount rates for lease liabilities was as follows:

Land Buildings Telecommunications equipment and machinery Others	December 31
	2022 2021 0.61%-1% 0.61%-1% 0.61%-1% 0.61%-1% 0.79%-1% 0.79%-1% 0.62%-0.86% 0.62%-0.86%

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c. Material lease-in activities and terms

TWM leases base transceiver stations and machine rooms, stores, offices, warehouses, maintenance centers, equipment, etc., with most of the lease terms ranging from 1 to 6 years. TWM does not have bargain purchase options to acquire the leasehold assets at the end of the lease terms. In addition, TWM is prohibited from subleasing all or any portion of the underlying assets without the lessors’ consents in some lease agreements. TWM can early terminate the arrangements if there are any controversial or other incidental matters that will cause the leasehold assets not being able to meet the purposes of use.

d. Other lease information

Expenses related to short-term leases Expenses related to low-value asset leases Expenses related to variable lease payments and not included in the measurement of lease liabilities Total cash outflow for leases	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 10,341 $ 71,076 $ 3,217 $ 3,555,516	2021 $ 8,551 $ 62,437 $ 2,991 $ 3,557,609

13. INVESTMENT PROPERTIES

TWM leases its properties to others and thus reclassifies them from property, plant and equipment to investment properties.

The fair values of investment properties were measured using Level 3 inputs, arising from income approach, comparative approach, and cost approach adopted by a third party real estate appraiser, HomeBan Appraisers Joint Firm. As of December 31, 2022 and 2021, the fair values of investment properties were $7,390,645 thousand and $6,944,511 thousand, respectively, and the capitalization rates for the aforementioned financial reporting periods were ranging from 1.43%-5.11% and 1.37%-5.23%, respectively.

The amounts of depreciation recognized for the years ended December 31, 2022 and 2021 were $20,163 thousand and $20,259 thousand, respectively.

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

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 and thereafter		December 31	December 31
		2022 $ 107,172 45,865 38,677 25,168 9,131 34,137 $ 260,150	2021 $ 154,582 92,986 33,889 26,975 13,711 - $ 322,143

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14. INTANGIBLE ASSETS

Cost Balance, January 1, 2022 Additions Disposals and retirements Reclassification Balance, December 31, 2022 Accumulated amortization and impairment Balance, January 1, 2022 Amortization Disposals and retirements Balance, December 31, 2022 Carrying amount, December 31, 2022 Cost Balance, January 1, 2021 Additions Disposals and retirements Reclassification Balance, December 31, 2021 Accumulated amortization and impairment Balance, January 1, 2021 Amortization Disposals and retirements Balance, December 31, 2021 Carrying amount, December 31, 2021	Concession Licenses $ 71,699,375 - - - $ 71,699,375 $ 17,818,565 4,136,584 - $ 21,955,149 $ 49,744,226 $ 71,699,375 - - - $ 71,699,375 $ 13,687,264 4,131,301 - $ 17,818,565 $ 53,880,810	Goodwill $ 7,121,871 - - - $ 7,121,871 $ - - - $ - $ 7,121,871 $ 7,121,871 - - - $ 7,121,871 $ - - - $ - $ 7,121,871		Other Intangible Assets Computer Software Copyrights $ 2,555,853 $ 122,681 141,035 5,022 (60,383) - 23,446 58,663 $ 2,659,951 $ 186,366 $ 2,362,468 $ 84,018 165,367 46,062 (60,383) - $ 2,467,452 $ 130,080 $ 192,499 $ 56,286 $ 2,441,718 $ 34,764 148,009 4,210 (41,019) - 7,145 83,707 $ 2,555,853 $ 122,681 $ 2,237,435 $ 26,018 166,052 58,000 (41,019) - $ 2,362,468 $ 84,018 $ 193,385 $ 38,663	Total $ 81,499,780 146,057 (60,383) 82,109 $ 81,667,563 $ 20,265,051 4,348,013 (60,383) $ 24,552,681 $ 57,114,882 $ 81,297,728 152,219 (41,019) 90,852 $ 81,499,780 $ 15,950,717 4,355,353 (41,019) $ 20,265,051 $ 61,234,729
				Computer Software $ 2,555,853 141,035 (60,383) 23,446 $ 2,659,951 $ 2,362,468 165,367 (60,383) $ 2,467,452 $ 192,499 $ 2,441,718 148,009 (41,019) 7,145 $ 2,555,853 $ 2,237,435 166,052 (41,019) $ 2,362,468 $ 193,385

The above intangible assets are amortized on a straight-line basis over their estimated useful lives as follows:

Concession licenses 14-21 years Computer software 1-6 years Copyrights Amortized over the broadcast period

a. Goodwill

The goodwill resulted from the merger of TransAsian Telecommunications Inc. in September 2008.

b. Impairment of assets

In conformity with IAS 36 “Impairment of Assets”, TWM identified its mobile communication services as the smallest identifiable units which can generate cash inflows independently.

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The recoverable amounts of the operating assets were evaluated by the critical assumptions used for this evaluation were as follows:

1) Assumptions on cash flows

The five-year cash flow projections were estimated on the basis of previous experience, actual operating results, and the financial budget.

2) Assumptions on operating revenues

3) Assumptions on operating costs and expenses

4) Assumptions on discount rates

For the years ended December 31, 2022 and 2021, the discount rates used to calculate the recoverable amount for the asset’s cash-generating unit were 5.79% and 6.01%, respectively.

Based on the key assumptions of the cash-generating unit, TWM’s management believes that the carrying amounts of these operating assets and intangible assets will not exceed their recoverable amounts even if there are any reasonable changes in the critical assumptions used to estimate recoverable amounts. For the years ended December 31, 2022 and 2021, impairment losses on assets did not occur.

15. OTHER NON-CURRENT ASSETS

Long-term accounts receivable Refundable deposits Other prepayments Others		December 31	December 31
		2022 $ 11,848 444,080 211,542 3,139 $ 670,609	2021 $ 6,401 428,669 209,569 2,271 $ 646,910

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16. BORROWINGS

a. Short-term borrowings

Unsecured loans - financing institution Unsecured loans - related parties Annual interest rates - financing institution Annual interest rates - related parties For the information on related party loans, see Note 28.		December 31	December 31
		2022 $ 19,300,000 13,005,000 $ 32,305,000 1.53%-1.65% 0.87%- 1.70378%	$ $

b. Short-term notes and bills payable

Short-term notes and bills payable Less: Discounts on short-term notes and bills payable Annual interest rates		December 31
		2022 2021 $ 3,100,000 $ 4,600,000 (7,605) (2,207) $ 3,092,395 $ 4,597,793 1.658% 0.398%-0.458%

c. Long-term borrowings

Commercial papers payable Less: Discounts on commercial papers payable Less: Current portion Annual interest rates - commercial papers payable		December 31
	2022 2021 $ 8,000,000 $ 6,500,000 3,503 2,191 (3,499,595) - $ 4,496,902 $ 6,497,809 0.688%-1.81% 0.687%-0.697%

1) Commercial papers payable

TWM’s commercial papers payable are treated as revolving credit facilities under the contracts. The last repayment dates of the commercial papers payable are no later than June 2025.

2) Unsecured loans

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17. BONDS PAYABLE

5th domestic unsecured straight corporate bonds 6th domestic unsecured straight corporate bonds 7th domestic unsecured straight corporate bonds Less: Current portion		December 31	December 31
		2022 $ 14,996,589 19,987,778 2,497,207 (5,999,631) $ 31,481,943	2021 $ 14,994,030 19,984,764 2,496,703 - $ 37,475,497

a. 5th domestic unsecured straight corporate bonds

Future repayments of the above-mentioned corporate bonds are as follows:

Year 2023 2025	Amount $ 6,000,000 9,000,000 $ 15,000,000

b. 6th domestic unsecured straight corporate bonds

Future repayments of the above-mentioned corporate bonds are as follows:

Year 2025 2027 2030	Amount $ 5,000,000 10,000,000 5,000,000 $ 20,000,000

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c. 7th domestic unsecured straight corporate bonds

Future repayments of the above-mentioned corporate bonds are as follows:

Year Amount 2028 $ 2,500,000

d. 3rd domestic unsecured convertible bonds

At the end of the third year from the bond issuance date, bondholders have the right to request TWM to redeem the convertible bonds at par value in cash.

Proceeds from the issuance (minus transaction costs $10,870 thousand) Equity component Financial liabilities Liability component at the date of issuance Interest charged at the effective interest rate Convertible bonds converted into common stock Repayment of the convertible bonds Liability component on December 31, 2021	$ 9,989,130 (400,564) (35,961) 9,552,605 245,053 (9,786,958) (10,700) $ -

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18. PROVISIONS

Restoration Warranties Current Non-current Restoration Balance, January 1, 2022 $ 530,038 Provision 18,024 Payment/Reversal (23,284) Unwinding of discount 590 Balance, December 31, 2022 $ 525,368 Balance, January 1, 2021 $ 653,796 Provision 11,927 Payment/Reversal (136,410) Unwinding of discount 725 Balance, December 31, 2021 $ 530,038		December 31	December 31
	2022 $ 525,368 16,334 $ 541,702 $ 30,473 511,229 $ 541,702 Warranties $ 23,774 25,132 (32,572) - $ 16,334 $ 21,935 34,354 (32,515) - $ 23,774		2021 $ 530,038 23,774 $ 553,812 $ 35,997 517,815 $ 553,812 Total $ 553,812 43,156 (55,856) 590 $ 541,702 $ 675,731 46,281 (168,925) 725 $ 553,812

19. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

TWM adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed and defined contribution plan. Under the LPA, an entity makes monthly contributions to employees’ individual pension accounts at 6% of monthly salaries and wages. In accordance with the above provisions, TWM’s contributions to the pension plan amounted to $164,292 thousand and $162,348 thousand for the years ended December 31, 2022 and 2021, respectively.

b. Defined benefit plans

TWM contributed 2% of each employee’s monthly wages to the pension fund, with Bank of Taiwan acting as the custodian bank, in accordance with the defined benefit plans (Plans). The Plans provides defined pension benefits for TWM’s certain qualified employees, specified under the Labor Standards Law, and such benefits are determined based on an employee’s years of service and average monthly salary for six-month period prior to the date of retirement. Before the end of each year, TWM assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, TWM will fund the difference in one appropriation before the end of March of the following year. The fund is operated and managed by the government’s designated authorities; as such, TWM does not have any right to participate in the operation of the fund.

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The defined benefit plans were as follows:

Present value of defined benefit obligations Fair value of plan assets Net defined benefit liabilities		December 31	December 31
		2022 $ 780,116 (703,131) $ 76,985	2021 $ 943,090 (646,423) $ 296,667

The movements in present value of defined benefit obligations for the years ended December 31, 2022 and 2021 were as follows:

Balance, January 1 Current service costs Interest costs Actuarial loss (gain) - changes in demographic assumptions Actuarial gain - changes in financial assumptions Actuarial gain - experience adjustments Benefits paid from plan assets Balance, December 31	For the Year Ended	For the Year Ended	December 31
		2022 $ 943,090 1,491 4,716 (258) (141,078) (10,344) (17,501) $ 780,116	2021 $ 949,836 1,486 4,749 37,994 (27,332) (11,677) (11,966) $ 943,090

The movements in the fair value of the plan assets for the years ended December 31, 2022 and 2021 were as follows:

Balance, January 1 Net interest income Return on plan assets (excluding amounts included in net interest) Contributions from the employer Benefits paid from plan assets Balance, December 31	For the Year Ended	For the Year Ended	December 31
		2022 $ 646,423 3,283 51,187 19,739 (17,501) $ 703,131	2021 $ 627,129 3,188 8,002 20,070 (11,966) $ 646,423

The expenses recognized in profit or loss for the years ended December 31, 2022 and 2021 were as follows:

Current service costs Interest costs Net interest income	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 1,491 4,716 (3,283) $ 2,924	2021 $ 1,486 4,749 (3,188) $ 3,047

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The pre-tax remeasurements recognized in other comprehensive income (loss) for the years ended December 31, 2022 and 2021 were as follows:

Return on plan assets (excluding amounts included in net interest) Actuarial loss (gain) - changes in demographic assumptions Actuarial gain - changes in financial assumptions Actuarial gain - experience adjustments	For the Year Ended	For the Year Ended	December 31
		2022 $ (51,187) (258) (141,078) (10,344) $ (202,867)	2021 $ (8,002) 37,994 (27,332) (11,677) $ (9,017)

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

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

The actuarial present values of the defined benefit obligation were carried out by the chartered actuary.

The principal assumptions used for the purpose of the actuarial valuations were as follows:

Discount rate Long-term average adjustment rate of salary	December 31
	2022 2021 1.5% 0.5% 2% 2.5%

Discount rate 0.25% increase 0.25% decrease Long-term average adjustment rate of salary 0.25% increase 0.25% decrease		December	31
		2022 $ (20,939) $ 21,701 $ 21,212 $ (20,572)	2021 $ (28,063) $ 29,164 $ 28,108 $ (27,200)

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The expected contributions to the Plans for the following year The average duration of the defined benefit obligation		December	31
		2022 $ 19,988 10.9 years	2021 $ 20,387 12.1 years

20. EQUITY

a. Share capital

b. Capital surplus

Additional paid-in capital from convertible corporate bonds Treasury stock transactions Difference between consideration and carrying amount arising from the disposal of subsidiaries’ stock Changes in equity of subsidiaries Changes in equity of associates accounted for using equity method Expired share options Others		December 31	December 31
		2022 $ 9,531,369 5,159,704 85,965 501,215 8,605 13,269 26,651 $ 15,326,778	2021 $ 11,107,455 5,159,704 85,965 501,215 10,828 13,269 24,803 $ 16,903,239

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c. Appropriation of earnings and dividend policy

The above appropriation of earnings should be resolved in the annual general stockholders’ meeting (AGM) held in the following year.

The appropriations of earnings for 2021 and 2020, which have been resolved in the AGM on June 23, 2022 and August 20, 2021, respectively, were as follows:

Legal reserve Special reserve Cash dividends Cash dividends per share (NT$)	Appropriation of Earnings
	For Fiscal Year 2021 For Fiscal Year 2020 $ 1,102,873 $ 1,330,074 (626,324) 2,449,739 10,551,987 9,521,178 3.7412 3.38353

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d. Other equity interests

Exchange
Differences on
Translation
Unrealized
Gain (Loss) on
Financial Assets
at FVTOCI

Balance, January 1, 2022
$ (44,294) $ (1,779,121)
Changes in fair value of financial assets at
FVTOCI

-
279,989
Changes in other comprehensive income
(loss) of subsidiaries and associates
accounted for using equity method

16,432
(407,122)
Valuation loss of equity instruments
transferred to retained earnings

-
2,308,625
Valuation loss of equity instruments
transferred to retained earnings due to
disposal by subsidiaries and associates

-
18,327
Income tax effect

-

(104,622)

Balance, December 31, 2022
$ (27,862)
$ 316,076

Balance, January 1, 2021
$ (31,679) $ (2,418,060)
Changes in fair value of financial assets at
FVTOCI

-
222,645
Valuation loss of equity instruments
transferred to retained earnings due to
disposal

-
2,209
Changes in other comprehensive income
(loss) of subsidiaries and associates
accounted for using equity method

(12,615)
523,520
Other comprehensive income transferred to
retained earnings due to disposal of
investments accounted for using equity
method

-
(22,885)
Other comprehensive loss transferred to
retained earnings due to the decrease of
percentage of ownership interest in the
investments accounted for using equity
method

-
849
Income tax effect

-

(87,399)

Balance, December 31, 2021
$ (44,294)
$ (1,779,121)

Total
$ (1,823,415)
279,989

(390,690)
2,308,625
18,327

(104,622)
$ 288,214
$ (2,449,739)
222,645
2,209
510,905

(22,885)
849

(87,399)
$ (1,823,415)

e. Treasury stock

As of December 31, 2022 and 2021, TWM’s stocks held for the investment purposes by TCC Investment Co., Ltd. (TCCI), TFN Union Investment Co., Ltd. (TUI) and TCCI Investment and Development Co., Ltd. (TID), which are all wholly-owned by TWM, were 698,752 thousand shares, and the market values were $66,171,777 thousand and $69,875,160 thousand, respectively. Since TWM’s stocks held by its subsidiaries are regarded as treasury stock, TWM recognized $29,717,344 thousand as treasury stock. For those treasury stockholders, they have the same rights as the other stockholders, except that they are not allowed to subscribe new shares issued by TWM for cash and exercise the voting rights over such treasury stock.

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21. OPERATING REVENUE

Revenue from contracts with customers Telecommunications and value-added services Sales revenue Other operating revenue	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 42,144,071 18,710,201 173,534 $ 61,027,806	2021 $ 41,083,469 18,595,512 165,823 $ 59,844,804

a. Contract information

Please refer to Note 4.

b. Contract balances

Contract assets Bundle sales Less: Allowance for impairment loss Current Non-current	December 31, 2022 $ 10,566,808 (89,818) $ 10,476,990 $ 5,086,808 5,390,182 $ 10,476,990	December 31, 2021 $ 9,942,623 (84,512) $ 9,858,111 $ 4,661,996 5,196,115 $ 9,858,111	January 1, 2021 $ 8,433,657 (71,686) $ 8,361,971 $ 4,612,234 3,749,737 $ 8,361,971

For notes and accounts receivable, please refer to Note 8.

TWM measures the loss allowance for contract assets at an amount equal to lifetime ECLs. The contract assets will be transferred to accounts receivable when the corresponding invoice is billed to the client, and the contract assets have substantially the same risk as the trade receivables. Therefore, TWM concluded that the expected loss rates for trade receivables can be applied to the contract assets. As of December 31, 2022 and 2021, the expected credit loss rates were both 0.85%.

Movements of the loss allowance of contract assets were as follows:

Beginning balance Provision Ending balance	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 84,512 5,306 $ 89,818	2021 $ 71,686 12,826 $ 84,512

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December 31, 2022 December 31, 2021 Contract liabilities Telecommunications and value-added services $ 1,171,071 $ 1,115,029 Sales of goods 7,409 12,665 $ 1,178,480 $ 1,127,694 Current $ 1,118,225 $ 1,066,995 Non-current 60,255 60,699 $ 1,178,480 $ 1,127,694	January 1, 2021 $ 1,182,830 8,955 $ 1,191,785 $ 1,133,438 58,347 $ 1,191,785

Contract assets Transfers of beginning balance to receivables	For the Year Ended December 31
	2022 2021 $ 4,551,949 $ 4,663,812

Revenue recognized in the current year from the contract liabilities at the beginning of the year is as follows:

Contract liabilities Telecommunications and value-added services Sales of goods	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 1,033,703 10,741 $ 1,044,444	2021 $ 1,092,603 7,161 $ 1,099,764

c. Partially completed contracts

As of December 31, 2022, the transaction prices allocated to the performance obligations that are not fully satisfied and the expected timing for recognition of revenue are as follows:

Telecommunications and value-added services	In 2023 $ 24,948,393	In 2024 $ 12,832,134	After 2025 $ 4,713,255	Total $ 42,493,782

The above information does not include contracts with expected durations which are equal to or less than one year.

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d. Assets related to contract costs

Incremental costs of obtaining a contract - non-current		December 31	December 31
		2022 $ 1,793,461	2021 $ 1,710,107

TWM considered the past experience and the default clauses in the sale contracts and believed the commission and the subsidy paid for obtaining a contract are wholly recoverable, therefore, such costs are capitalized. The amounts of amortization recognized for the years ended December 31, 2022 and 2021 were $1,200,756 thousand and $1,302,825 thousand, respectively.

22. NON-OPERATING INCOME AND EXPENSES

a. Other gains and losses, net

Loss on disposal and retirement of property, plant and equipment, net Gain on disposal of property, plant and equipment held for sale Gain on disposal of investments accounted for using equity method Gain (loss) on foreign exchange, net Others Finance costs Interest expense Corporate bonds Bank loans Related parties Commercial papers payable Lease liabilities Others	For the Year Ended	For the Year Ended	December 31
	2022 $ (222,543) 1,014 - (25,952) 583 $ (246,898) For the Year Ended		2021 $ (24,041) - 29 8,903 (216) $ (15,325) December 31
		2022 $ 294,207 201,547 117,538 85,049 56,049 866 $ 755,256	2021 $ 291,668 112,062 109,353 72,774 60,119 1,000 $ 646,976

b. Finance costs

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23. INCOME TAX

a. Income tax recognized in profit or loss

Current income tax expense Current period Prior years’ adjustments Deferred income tax expense Temporary differences Income tax expense	For the Year Ended	For the Year Ended	December 31
		2022 $ 872,180 11,029 883,209 24,109 $ 907,318	2021 $ 891,699 (348,057) 543,642 138,610 $ 682,252

The reconciliation of profit before tax to income tax expense was as follows:

Profit before tax Income tax expense at domestic statutory tax rate Adjustment items in determining taxable profit Temporary differences Investment tax credits Land value increment tax Prior years’ adjustments Income tax recognized in other comprehensive income (loss) Deferred income tax expense Unrealized gain/loss on financial assets at FVTOCI Remeasurements from defined benefit plans	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2022 2021 $ 11,932,869 $ 11,670,417 $ 2,386,574 $ 2,334,083 (1,514,464) (1,442,169) 24,109 138,610 - (1,182) 70 967 11,029 (348,057) $ 907,318 $ 682,252 For the Year Ended December 31
		2022 $ 104,622 40,573 $ 145,195	2021 $ 87,399 1,804 $ 89,203

b. Income tax recognized in other comprehensive income (loss)

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c. Deferred tax assets and liabilities

Changes in the amount of deferred tax assets and liabilities for the years ended December 31, 2022 and 2021 were as follows:

Deferred tax assets Property, plant and equipment Defined benefit plans Financial assets at FVTOCI Others Deferred tax liabilities Intangible assets Financial assets at FVTOCI Deferred tax assets Property, plant and equipment Defined benefit plans Financial assets at FVTOCI Others Deferred tax liabilities Intangible assets		For the Year Ended December 31, 2022	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022
		Recognized in Opening Balance Profit or Loss Other Comprehensive Income (Loss) Closing Balance $ 165,704 $ (20,857) $ - $ 144,847 59,333 (3,363) (40,573) 15,397 24,374 - (24,374) - 185,776 111 - 185,887 $ 435,187 $ (24,109) $ (64,947) $ 346,131 $ 703,734 $ - $ - $ 703,734 - - 80,248 80,248 $ 703,734 $ - $ 80,248 $ 783,982 For the Year Ended December 31, 2021
		Opening Balance $ 255,102 64,541 111,773 206,529 $ 637,945 $ 678,679	Recognized in Profit or Loss Other Comprehensive Income (Loss) $ (89,398) $ - (3,404) (1,804) - (87,399) (20,753) - $ (113,555) $ (89,203) $ 25,055 $ -	Closing Balance $ 165,704 59,333 24,374 185,776 $ 435,187 $ 703,734

d. The income tax returns through 2020 have been examined and cleared by the tax authorities.

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24. EARNINGS PER SHARE

Basic EPS Profit attributable to stockholders Effect of dilutive potential common stock: Employees’ compensation Diluted EPS Profit attributable to stockholders (adjusted for potential effect of common stock) Basic EPS Profit attributable to stockholders Effect of dilutive potential common stock: Employees’ compensation Convertible bonds Diluted EPS Profit attributable to stockholders (adjusted for potential effect of common stock)	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022
	Amount After Income Tax Weighted- average Number of Shares (In Thousands) EPS (NT$) $ 11,025,551 2,820,482 $ 3.91 - 3,717 $ 11,025,551 2,824,199 $ 3.90 For the Year Ended December 31, 2021
	Amount After Income Tax Weighted- average Number of Shares (In Thousands) $ 10,988,165 2,814,930 - 4,221 4,735 5,669 $ 10,992,900 2,824,820	EPS (NT$) $ 3.90 $ 3.89

Since TWM has the discretion to settle the employees’ compensation by cash or stock, TWM should presume that the entire amount of the employees’ compensation will be settled in stock, and the potential stock dilution should be included in the weighted-average number of stock outstanding used in the calculation of diluted EPS, provided there is a dilutive effect. Such dilutive effect of the potential stock needs to be included in the calculation of diluted EPS until employees’ compensation is approved in the following year.

25. CASH FLOW INFORMATION

Changes in liabilities arising from financing activities:

For the Year Ended December 31, 2022

Lease liabilities (including current and non-current portions)	Opening Balance $ 7,344,167	Cash Flows $ (3,442,956)		Non-cash Changes New Leases Others $ 4,301,810 $ (206,650)	Ending Balance $ 7,996,371
				New Leases $ 4,301,810

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For the Year Ended December 31, 2021

Lease liabilities (including current and non-current portions)	Opening Balance $ 7,532,213	Cash Flows $ (3,454,374)		Non-cash Changes New Leases Others $ 3,488,869 $ (222,541)	Ending Balance $ 7,344,167
				New Leases $ 3,488,869

26. CAPITAL MANAGEMENT

TWM maintains and manages its capital to meet the minimum paid-in capital required by the competent authority, and to optimize the balance of liabilities and equity in order to maximize stockholders’ return. By periodically reviewing and measuring relative cost, risk, and rate of return to ensure profit and to maintain adequate financial ratios, TWM may adopt various financing approaches to balance its capital structure in order to meet the demands for working capital, capital expenditures, settlements of liabilities, and dividend payments in its normal course of business for the future.

27. FINANCIAL INSTRUMENTS

a. Categories of financial instruments

Financial assets Financial assets at FVTOCI (including current and non-current portions) Financial assets measured at amortized cost (including current and non-current portions) (Note 1) Financial liabilities Financial liabilities measured at amortized cost (including current and non-current portions) (Note 2)		December 31	December 31
		2022 $ 2,161,031 10,623,279 $ 12,784,310 $ 91,192,320	2021 $ 2,177,417 9,376,634 $ 11,554,051 $ 89,639,619

Note 1: The balances comprise cash and cash equivalents, notes and accounts receivable, other receivables, other financial assets and refundable deposits, which were financial assets measured at amortized cost.
Note 2: The balances comprise long-term and short-term borrowings, commercial papers payable, notes and accounts payable, other payables, other financial liabilities (classified as other current liabilities), bonds payable and guarantee deposits, which were financial liabilities measured at amortized cost.
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b. Fair value of financial instruments
1) Financial instruments not measured at fair value

Except for the table below, TWM considers that the carrying amount of financial assets and liabilities that are not at fair value is close to the fair value, or the fair value cannot be reliably measured.

Financial liabilities Bonds payable (including current portion)	December 31	December 31
	2022 Carrying Amount Fair Value $ 37,481,574 $ 36,972,577	2021
		Carrying Amount Fair Value $ 37,475,497 $ 37,702,271

The fair value of bonds payable is measured by Level 2 inputs, using a volume-weighted average price on the TPEx at the end of the reporting period.

2) Fair value of financial instruments that are measured at fair value on a recurring basis

Level 1: Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities on the reporting date.
Level 2: Inputs other than quoted prices included within Level 1 are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices).
Level 3: Inputs for the assets or liabilities are not based on observable market data (unobservable inputs).

December 31, 2022

Financial assets at FVTOCI Equity instruments Domestic listed stocks Domestic unlisted stocks Foreign unlisted stocks Limited partnerships	Level 1 $ 245,607 - - - $ 245,607	Level 2 $ - - - - $ -	Level 3 $ - 674,999 30,137 1,210,288 $ 1,915,424	Total $ 245,607 674,999 30,137 1,210,288 $ 2,161,031

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December 31, 2021

Financial assets at FVTOCI Equity instruments Domestic listed stocks Domestic unlisted stocks Foreign unlisted stocks Limited partnerships	Level 1 $ 1,051,959 - - - $ 1,051,959	Level 2 $ - - - - $ -	Level 3 $ - 408,139 27,672 689,647 $ 1,125,458	Total $ 1,051,959 408,139 27,672 689,647 $ 2,177,417

There were no transfers between the fair value measurements of Levels 1 and 2 for the years ended December 31, 2022 and 2021.

Valuation techniques and assumptions used in fair value determination

a) The fair value of financial instruments traded in active markets is based on quoted market prices (including stocks of publicly traded companies).
b) Valuation techniques and inputs applied for Level 3 fair value measurement:

The fair value of unlisted stocks and limited partnerships investments was evaluated through the market approach and asset approach. The evaluation and assumptions are mainly referenced to related information of comparable transactions or companies. The unobservable input was liquidity discount rate, which were estimated to be 26.2% as of December 31, 2022 and 2021.

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

For the Year Ended December 31, 2022

	Financial Assets
	at FVTOCI -
	Equity
	Instruments
Balance at January 1, 2022	$ 1,125,458
Additions	375,000
Recognized in other comprehensive income (unrealized gain on financial assets
at FVTOCI)	414,966
Balance at December 31, 2022	$ 1,915,424

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For the Year Ended December 31, 2021

	Financial Assets	Financial Assets
	at	FVTOCI -
		Equity
	Instruments
Balance at January 1, 2021	$	736,432
Recognized in other comprehensive income (unrealized gain on financial assets
at FVTOCI)		389,026
Balance at December 31, 2021	$	1,125,458

c. Financial risk management
1) TWM’s major financial instruments include equity investments, trade receivables, trade payables, commercial papers payable, bonds payable, borrowings, lease liabilities, etc., and TWM is exposed to the following risks due to usage of financial instruments:
- a) Credit risk
- b) Liquidity risk
- c) Market risk

This note presents information concerning TWM’s risk exposure and TWM’s targets, policies and procedures to measure and manage the risks.

2) Risk management framework
a) Decision-making mechanism

b) Risk management policies
i. Promote a risk-management-based business model.
ii. Establish a risk management mechanism that can effectively recognize, evaluate, supervise and control risk.

iii. Create a company-wide risk management structure that can limit risk to an acceptable level.

iv. Introduce best risk management practices and continue to seek improvements.
c) Monitoring mechanism

The Internal Audit Office assesses the potential risks that TWM may face and uses this information as a reference for determining its annual audit plan. The Internal Audit Office reports the results and findings of performing such procedures, and follows up the discrepancies, if any, for actions.

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3) Credit risk

Credit risk refers to the risk that a counterparty would default on its contractual obligations, resulting in a financial loss to TWM. The maximum credit exposure of the aforementioned financial instruments is equal to their carrying amounts recognized in the balance sheets as of the balance sheet date. TWM has large trade receivables outstanding with its customers. A substantial majority of TWM’s outstanding trade receivables are not covered by collateral or credit insurance. TWM has implemented ongoing measures including enhancing credit assessments and strengthening overall risk management to reduce its credit risk. While TWM has procedures to monitor and limit exposure to credit risk on trade receivables, there can be no assurance such procedures will effectively limit its credit risk and avoid losses. This risk is heightened during periods when economic conditions worsen.

As TWM serves a large number of unrelated consumers, the concentration of credit risk was limited.

4) Liquidity risk

Liquidity risk is the risk that TWM fails to meet the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. TWM’s approach to manage liquidity is to ensure, as far as possible, that it always has sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable loss or damage to TWM’s reputation.

TWM manages and maintains a sufficient level of capital to ensure the requirements of paying estimated operating expenditures, including financial obligations on each contract. TWM also monitors its bank credit facilities to ensure that TWM fully complies with the provisions and financial covenants of loan contracts. As of December 31, 2022 and 2021, TWM had unused bank facilities of $50,745,557 thousand and $46,518,715 thousand, respectively.

The table below summarizes the maturity profile of TWM’s financial liabilities based on contractual undiscounted payments, but not including the financial liabilities whose carrying amounts approximate contractual cash flows:

December 31, 2022 Unsecured loans Unsecured loans - related parties Commercial papers payable Bonds payable Lease liabilities	Contractual Cash Flows Within 1 Year $ 19,389,248 $ 19,389,248 13,077,626 13,077,626 11,279,084 6,697,116 38,614,380 6,288,130 8,085,962 3,062,916 $ 90,446,300 $ 48,515,036	1-5 Years $ - - 4,581,968 24,705,000 5,007,571 $ 34,294,539	5-10 Years $ - - - 7,621,250 15,475 $ 7,636,725 (Continued)

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December 31, 2021 Unsecured loans Unsecured loans - related parties Commercial papers payable Bonds payable Lease liabilities	Contractual Cash Flows Within 1 Year $ 18,818,117 $ 18,818,117 11,579,042 11,579,042 11,186,827 4,642,649 38,902,510 288,130 7,423,605 2,979,718 $ 87,910,101 $ 38,307,656	1-5 Years $ - - 6,544,178 20,877,880 4,428,984 $ 31,851,042	5-10 Years $ - - - 17,736,500 14,903 $ 17,751,403 (Concluded)

5) Market risk

Market risk is the risk that arising from the changes in foreign exchange rates, interest rates, and prices, and will affect TWM’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within an acceptable range and to optimize the return.

TWM carefully evaluates each financial instrument transaction involving any risk such as exchange rate risk, interest rate risk, and market price risk in order to decrease potential influences caused by market uncertainty.

a) Exchange rate risk

TWM mainly operates in Taiwan, except for international roaming services. Most of the operating revenue and expenses are measured in NTD. A small portion of the expenses is paid in USD, EUR, etc.; thus, TWM purchases currency at the spot rate based on the conservative principle in order to hedge exchange rate risk.

TWM’s foreign currency assets and liabilities exposed to significant exchange rate risk were as follows:

Foreign currency assets Monetary items USD EUR Non-monetary items USD Foreign currency liabilities Monetary items USD EUR	December 31, 2022
	Foreign Currencies Exchange Rate New Taiwan Dollars $ 31,213 30.725 $ 959,023 83 32.65 2,725 40,372 30.725 1,240,425 7,696 30.725 236,466 2 32.65 79

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Foreign currency assets Monetary items USD EUR Non-monetary items USD Foreign currency liabilities Monetary items USD EUR	December 31, 2021
	Foreign Currencies Exchange Rate New Taiwan Dollars $ 18,101 27.66 $ 500,668 1,273 31.25 39,797 25,933 27.66 717,319 10,977 27.66 303,623 2 31.25 72

Refer to Note 22(a) for the information related to TWM’s realized and unrealized foreign exchange gains (losses) for the years ended December 31, 2022 and 2021, respectively.

Sensitivity analysis

TWM’s exchange rate risk comes mainly from conversion gains and losses of accounts denominated in monetary items of foreign currencies. If there had been an unfavorable 5% movement in the levels of foreign exchanges against NTD at the end of the reporting period (with other factors remaining constant at the end of the reporting period and with analyses of the two periods on the same basis), profit would have decreased by $36,260 thousand and $11,839 thousand for the years ended December 31, 2022 and 2021, respectively.

b) Interest rate risk

TWM issued unsecured straight corporate bonds and signed facility agreements with financial institutions for locking in medium- and long-term fixed interest rates to reduce the impact of interest rates fluctuation.

The carrying amounts of TWM’s financial assets and financial liabilities exposed to interest rate risk were as follows:

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities	December 31
	2022 2021 $ 345,107 $ 352,954 78,057,059 86,504,048 2,122,912 1,538,012 11,099,424 -

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Sensitivity analysis

The following sensitivity analysis is based on the exposure to interest rate risk of derivative and non-derivative instruments at the end of the reporting period. For floating-rate assets and liabilities, the analysis assumes that the balances of outstanding assets and liabilities at the end of the reporting period have been outstanding for the whole period and that the changes in interest rates are reasonable. If the interest rate had increased by 50 basis points (with other factors remaining constant at the end of the reporting period and with analyses of the two periods on the same basis), profit would have decreased by $44,883 thousand and increased by $7,690 thousand for the years ended December 31, 2022 and 2021, respectively.

c) Other market price risk

The exposure to financial instrument price risk is mainly due to holding of stocks. TWM manages the risk by maintaining portfolios of investments with different risks and by continuously monitoring the future developments and market trends of investment targets.

Sensitivity analysis

If the prices of financial instruments had decreased by 5% (with other factors remaining constant and with the analyses of the two periods on the same basis), other comprehensive income would have decreased by $108,052 thousand and $108,871 thousand since the fair value of financial assets at FVTOCI decreased for the years ended December 31, 2022 and 2021, respectively.

28. RELATED-PARTY TRANSACTIONS

a. Related party name and nature of relationship

Related Party Nature of Relationship Taiwan Cellular Co., Ltd. (TCC) Subsidiary Wealth Media Technology Co., Ltd. (WMT) Subsidiary TWM Venture Co., Ltd. (TVC) Subsidiary Taipei New Horizon Co., Ltd. (TNH) Subsidiary Fu Sheng Digital Co., Ltd. (FSD) Subsidiary Taiwan Fixed Network Co., Ltd. (TFN) Subsidiary Taiwan Teleservices & Technologies Co., Ltd. (TT&T) Subsidiary momo.com Inc. (momo) Subsidiary Taiwan Kuro Times Co., Ltd. (TKT) Subsidiary Taiwan Digital Service Co., Ltd. (TDS) Subsidiary TUI Subsidiary TCCI Subsidiary TID Subsidiary Taihsin Property Insurance Agent Co., Ltd. (TPIA) Subsidiary Tai-Fu Cloud Technology Co., Ltd. (TFC) Subsidiary Taiwan Mobile Film Co., Ltd. (TWMFM) Subsidiary Taiwan Stampede Franchise Film Co., Ltd. (SFF) Subsidiary TFN Media Co., Ltd. (TFNM) Subsidiary Global Forest Media Technology Co., Ltd. (GFMT) Subsidiary Win TV Broadcasting Co., Ltd. (WTVB) Subsidiary Yeong Jia Leh Cable TV Co., Ltd. (YJCTV) Subsidiary Mangrove Cable TV Co., Ltd. (MCTV) Subsidiary Phoenix Cable TV Co., Ltd. (PCTV) Subsidiary

(Continued)

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Nature of Relationship

Related Party

Union Cable TV Co., Ltd. (UCTV) Globalview Cable TV Co., Ltd. (GCTV) Bebe Poshe International Co., Ltd. (Bebe Poshe) Fu Sheng Logistics Co., Ltd. (FSL) MFS Co., Ltd. (MFS) AppWorks Uspace Tech Co., Ltd. (Uspace) kbro Media Co., Ltd. (kbro Media) Mistake Entertainment Co., Ltd. (M.E.) AppWorks School Co., Ltd. Good Image Co., Ltd. Taiwan Pelican Express Co., Ltd. Fubon Life Insurance Co., Ltd. Fubon Insurance Co., Ltd. (Fubon Insurance) Fubon Securities Investment Trust Co., Ltd. Fubon Sports & Entertainment Co., Ltd. (FSE) Taipei Fubon Commercial Bank Co., Ltd. (TFCB) Fubon Financial Holding Co., Ltd. Fubon Securities Co., Ltd. Fubon Futures Co., Ltd. Fubon Investment Services Co., Ltd. Fubon Marketing Co., Ltd. Fu-Sheng Insurance Agency Co., Ltd. Fubon Insurance Agency Co., Ltd. Fubon Financial Venture Capital Co., Ltd. Fubon Gymnasium Co., Ltd. Fubon Asset Management Co., Ltd. One Production Film Co., Ltd. Fubon Land Development Co., Ltd. Fubon Property Management Co., Ltd. Fubon Real Estate Management Co., Ltd. Fubon Hospitality Management Co., Ltd. Fubon Private Equity Co., Ltd. TFB Capital Co., Ltd. P. League+ Co., Ltd. Jih Sun Financial Holding Co., Ltd. Jih Sun Securities Co., Ltd. Jih Sun International Bank, Ltd. Jih Sun International Property Insurance Agent Co., Ltd. Jih Sun Life Insurance Agent Co., Ltd. Jih Sun Futures Co., Ltd. Jih Sun Securities Investment Consulting Co., Ltd. Chung Hsing Constructions Co., Ltd. Ming Dong Co., Ltd. (Ming Dong) Fu Yi Health Management Co., Ltd. Chen Yun Co., Ltd. kbro Co., Ltd. (kbro) Daanwenshan CATV Co., Ltd. North Taoyuan CATV Co., Ltd.

Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Associate Associate Associate Associate Associate (subsidiary of AppWorks) Associate (subsidiary of kbro Media) Associate (not a related party since the first quarter of 2021) Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party

Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party Other related party

(Continued)

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Nature of Relationship

Related Party

Yangmingshan CATV Co., Ltd. Other related party Hsin Taipei CATV Co., Ltd. Other related party Chinpingtao CATV Co., Ltd. Other related party Hsintangcheng CATV Co., Ltd. Other related party Chuanlien CATV Co., Ltd. Other related party Chen Tao Cable TV Co., Ltd. Other related party Fengmeng Cable TV Co., Ltd. Other related party Hsinpingtao CATV Co., Ltd. Other related party Kuansheng CATV Co., Ltd. Other related party Nantien CATV Co., Ltd. Other related party Taiwan Win TV Media Co., Ltd. Other related party Taiwan Mobile Foundation (TMF) Other related party Fubon Cultural & Educational Foundation Other related party Fubon Charity Foundation Other related party Fubon Art Foundation Other related party Taipei Fubon Bank Charity Foundation Other related party Taipei New Horizon Management Agency Other related party Far Eastern Memorial Hospital Other related party (not a related party since the third quarter of 2021) Key management Chairman, director, president, vice president, etc. (Concluded)

b. Significant transactions with related parties

1) Operating revenue

Subsidiaries Associates Other related parties	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 3,419,342 507 276,522 $ 3,696,371	2021 $ 2,945,000 2,175 240,994 $ 3,188,169

TWM renders telecommunications, sales, maintenance, lease services, etc., to the related parties. The transaction terms with related parties were not significantly different from those with third parties.

2) Purchases

Subsidiaries TFN Others Associates Other related parties	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 5,043,666 742,423 811 491,212 $ 6,278,112	2021 $ 4,231,243 801,281 1,730 376,108 $ 5,410,362

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The entities mentioned above provide telecommunications and value-added services, purchases, broadband and other services. The transaction terms with related parties were not significantly different from those with third parties.

3) Receivables due from related parties

Account Related Party Categories Accounts receivable Subsidiaries Accounts receivable Associates Accounts receivable Other related parties Other receivables Subsidiaries Other receivables Other related parties		December 31	December 31
		2022 $ 473,910 - 53,384 $ 527,294 $ 188,368 55,667 $ 244,035	2021 $ 419,927 333 50,049 $ 470,309 $ 79,078 40,785 $ 119,863

Receivables from related parties mentioned above were not secured with collateral, and no provisions for impairment loss were accrued.

4) Payables due to related parties

Account Related Party Categories Accounts payable Subsidiaries Accounts payable Associates Accounts payable Other related parties Other payables Subsidiaries Other payables Other related parties		December 31	December 31
		2022 $ 191,356 - 96,591 $ 287,947 $ 643,516 55,893 $ 699,409	2021 $ 211,375 76 82,575 $ 294,026 $ 561,072 34,388 $ 595,460

5) Borrowings from related parties

Subsidiaries TFN WMT Others		December 31	December 31
		2022 $ 9,413,000 3,179,000 413,000 $ 13,005,000	2021 $ 7,913,000 3,230,000 388,000 $ 11,531,000

The rate on borrowings from related parties was equivalent to the rate in the market.

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6) Bank deposits and other financial assets

	December 31	December 31
2022 2021 $ 602,370 $ 620,624 Shares (In Thousands) Purchase Price 210,000 $ 2,100,000 57,000 $ 570,000 December 31
2022 2021 $ 38,905 $ 34,910 8,887 10,425 $ 47,792 $ 45,335 $ 98,955 $ 77,691 167,264 159,666 $ 266,219 $ 237,357 For the Year Ended December 31
	2022 $ 955,450 33,259 1,134 16,100 52,451 139,353 92,585 $ 1,290,332	2021 $ 999,906 34,247 13,760 17,100 38,761 123,566 95,017 $ 1,322,357

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For the years ended December 31, 2022 and 2021, TWM’s service charges received (recognized as deduction of other income and expenses) were as follows:

Amounts received Subsidiaries TFN Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 393,468 27,648 $ 421,116	2021 $ 404,344 21,768 $ 426,112

For the years ended December 31, 2022 and 2021, TWM’s service charges paid were as follows:

Amounts paid Subsidiaries TFN Finance costs - interest expenses of financing from other parties Subsidiaries TFN Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2022 2021 $ 43,016 $ 55,820 For the Year Ended December 31
		2022 $ 84,485 33,053 $ 117,538	2021 $ 74,489 34,864 $ 109,353

9)	Lease arrangements Acquisition of right-of-use assets Subsidiaries Other related parties Lease liabilities (including current and non-current portions) Subsidiaries Other related parties	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
			2022 2021 $ 108 $ 144,811 3,940 172,504 $ 4,048 $ 317,315 December 31
			2022 $ 280,740 160,904 $ 441,644	2021 $ 444,025 231,579 $ 675,604

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The leases are conducted by referring to general market prices, and all the terms and conditions conform to normal business practices.

c. Key management compensation

The amounts of remuneration of directors and key executives were as follows:

Short-term employee benefits Termination and post-employment benefits	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 288,121 11,385 $ 299,506	2021 $ 272,962 8,070 $ 281,032

29. ASSETS PLEDGED

The assets pledged as collateral for performance bonds were as follows:

Other current financial assets Other non-current financial assets		December	31
		2022 $ 31,351 480 $ 31,831	2021 $ 28,105 480 $ 28,585

30. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

a. Unrecognized commitments

Purchases of property, plant and equipment Purchases of inventories and sales commitments		December 31	December 31
		2022 $ 7,117,937 $ 9,577,839	2021 $ 2,724,280 $ 7,252,941

As of December 31, 2022 and 2021, the amounts of lease commitments commencing after the balance sheet dates were $187,601 thousand and $215,517 thousand, respectively.

b. As of December 31, 2022 and 2021, the amounts of endorsements and guarantees provided to TFN, TKT and TVC were both $24,750,000 thousand.
c. In August 2015, FET filed a statement of civil complaint with the Taipei District Court, in which FET claimed that (i) TWM shall apply for the return of the C4 spectrum block; (ii) TWM shall not use the C4 spectrum block; (iii) TWM shall not use the C1 spectrum block until TWM’s application for the return of the C4 spectrum block is approved by the NCC; and (iv) TWM shall provide $1,005,800 thousand to FET as compensation. In May 2016, the Court decided in favor of FET regarding claims (i), (ii), and (iii) of the lawsuit, and against FET regarding claim (iv) of the lawsuit. TWM and FET appealed with the High Court the reversal of the aforementioned sentences. The High Court dismissed the appeal of TWM regarding claims (i), (ii), and (iii), and regarding claim (iv) of FET, TWM shall pay FET $765,779 thousand, of which $152,584 thousand of the above amount, TWM shall make 5% annual interest payment for the period starting from September 5, 2015 to the payment date. TWM and FET appealed the reversal of the aforementioned sentences. In May 2019, the Supreme Court dismissed
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the portion of High Court’s original judgment on other appeal of FET regarding, and dismissed TWM’s payment obligation, and the Supreme Court remanded the case to the High Court. Under the first retrial of the High Court, TWM filed a counterclaim requesting that FET pay $14,482 thousand, as well as a 5% annual interest payment for the period starting from the date following the service of the counterclaim until the settlement date. In August 2020, the High Court first retrial results were as follows: for the dismissed claim (iv) stated above, TWM shall pay FET $242,154 thousand of which $142,685 thousand shall have 5% annual interest for the period starting from September 30, 2016 to the payment date, and $99,469 thousand shall have 5% annual interest for the period starting from July 21, 2017 to the payment date. TWM’s counterclaim was denied. TWM and FET appealed the aforementioned sentences which were not favorable to them. The case is now in process at the Supreme Court.

31. SIGNIFICANT EVENTS AFTER REPORTING PERIOD

a. On December 30, 2021, TWM’s Board of Directors resolved and signed the merger agreement with Taiwan Star Telecom Corporation Limited (TST). The NCC announced the approval of TWM's merger with TST with incidental provisions on January 18, 2023. On February 24, 2023, TWM’s Board of Directors resolved the share exchange ratio of one TST share for 0.0326 TWM shares. The merger still requires regulatory approval from the Fair Trade Commission.
b. In February 2023, the Board of Directors resolved that TWM would issue unsecured straight corporate bonds with a total amount of no more than $6,500,000 thousand.

32. OTHERS

Employee benefits, depreciation, and amortization are summarized as follows:

Employee benefits Salary Insurance expenses Pension Compensation of directors Others Depreciation Amortization	For the Year Ended December 31, 2022
	Classified as Operating Costs Classified as Operating Expenses Classified as Operating Costs or Expense Deduction Total $ 1,074,025 $ 2,630,392 $ 305,940 $ 4,010,357 81,707 226,911 19,967 328,585 44,475 112,065 10,676 167,216 - 89,434 - 89,434 48,164 133,182 - 181,346 8,625,335 757,475 - 9,382,810 4,220,307 1,328,462 - 5,548,769

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Employee benefits Salary Insurance expenses Pension Compensation of directors Others Depreciation Amortization	For the Year Ended December 31, 2021
	Classified as Operating Costs Classified as Operating Expenses Classified as Operating Costs or Expense Deduction Total $ 1,177,769 $ 2,641,517 $ 296,335 $ 4,115,621 85,365 225,462 18,235 329,062 45,900 109,908 9,587 165,395 - 98,801 - 98,801 48,534 133,232 - 181,766 8,426,821 816,879 - 9,243,700 4,224,137 1,434,041 - 5,658,178

a. For the years ended December 31, 2022 and 2021, the average numbers of TWM employees were 3,755 and 3,770, respectively, and the numbers of directors who were not employees were both 8.
b. For the years ended December 31, 2022 and 2021, TWM’s average employee benefits were $1,251 thousand and $1,274 thousand, respectively, and TWM’s average salaries were $1,070 thousand and $1,094 thousand, respectively. The percentage change in the average salary expenses was -2%.
c. TWM does not have any supervisors.
d. The compensation policies of TWM are as follows:

Directors

The remuneration or other equivalent allowances for directors is determined based on their involvement in TWM’s operations, contributions to the Company, and the general pay levels in the industry.

If TWM makes a profit, remuneration of directors is set at no higher than 0.3% of the profit which is specified in TWM’s Articles of Incorporation.

Transportation allowances paid are based on attendance in board meetings and for services rendered as the chairman or a member of the Board, Audit Committee, Remuneration and Nomination Committee and ESG Steering Committee.

Managers

Compensation of managers comprises fixed salary and variable compensation. Fixed salary is paid monthly. Variable compensation is in the form of employees’ compensation and performance-based bonuses, which accounts for approximately 40%-50% of the total compensation of each manager. TWM takes the manager’s contribution to the company’s operations, future operating risk exposure, environmental conservation and corporate sustainable development into consideration during their assessment of the compensation of managers in accordance with the performance management policies.

In order to strengthen the link between corporate sustainable development and compensation of the manager, TWM may downgrade the manager’s assessment of the year by one level or reduce the manager’s performance-based bonuses and employees’ compensation within 10% if the goals of corporate sustainable development are not achieved.

64 -

Variable compensation is proposed by the Remuneration and Nomination Committee and approved by the Board of Directors.

Employees

Employees are the most valuable assets to TWM. In order to maintain the competitiveness of compensation, TWM evaluates the pay level in the labor market by participating in salary surveys every year. Operational performance and future development are also taken into consideration when determining the compensation policy. To fulfill the performance-oriented compensation policy, TWM shares the operating achievements with employees by settling performance-based bonuses and employees’ compensation according to the performance of the employee.

e. Information of employees’ compensation and remuneration of directors

Amounts approved by the Board of Directors Amounts recognized in the financial statements	For the Year Ended December 31	For the Year Ended December 31
	2022 Employees’ Compensation Paid in Cash Remuneration of Directors $ 305,936 $ 30,594 $ 305,936 $ 30,594	2021
		Employees’ Compensation Paid in Cash Remuneration of Directors $ 362,061 $ 36,206 $ 362,061 $ 36,206

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

Information on the employees’ compensation and remuneration of directors approved by the Board of Directors is available at the Market Observation Post System website of the Taiwan Stock Exchange.

33. ADDITIONAL DISCLOSURES

a. Information on significant transactions and b. Information on investees:
1) Financing extended to other parties: Table 1 (attached)
2) Endorsements/guarantees provided to other parties: Table 2 (attached)
3) Marketable securities held (excluding investments in subsidiaries and associates): Table 3 (attached)
65 -
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 4 (attached)
5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in
- capital: None
6) Disposal 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 of at least NT$100 million or 20% of the paid-in capital: Table 5 (attached)
8) Receivables from related parties of at least NT$100 million or 20% of the paid-in capital: Table 6
- (attached)
9) Names, locations and related information of investees on which TWM exercised significant influence (excluding information on investments in mainland China): Table 7 (attached)
10) Trading in derivative instruments: None
c. Information on investments in mainland China:
1) The names of investees in mainland China, the main businesses and products, issued capital, method of investment, information on inflow or outflow of capital, ownership, net income or loss and recognized investment gain or loss, ending balance, amount received as earnings distributions from the investment, and limitation on investment: Table 8 (attached)
2) Significant direct or indirect transactions with the investee companies, the prices and terms of payment, unrealized gain or loss, and other related information which is helpful to understand the impact of investment in mainland China on financial reports: None
d. Information of major stockholders, the name, the number of stocks owned, and percentage of ownership of each stockholder with ownership of 5% or greater: Table 9 (attached)

34. SEGMENT INFORMATION

Please refer to the consolidated financial statements for the year ended December 31, 2022.

66 -

TABLE 1

TAIWAN MOBILE CO., LTD.

FINANCING EXTENDED TO OTHER PARTIES FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

No.	Lending Company	Borrowing Company	Financial Statement Account	Related Parties	Maximum Balance for the Period (Note 1)	Ending Balance (Note 1)	Drawdown Amounts	Interest Rate	Nature of Financing	Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Lending Limit for Each Borrowing Company	Lending Company’s Lending Amount Limits	Note
													Item	Value
1	TCC	TWM TFC	Other receivables Other receivables	Yes Yes	$ 500,000 700,000	$ 500,000 700,000	$ 413,000 291,000	0.86856%-1.12000% 1.16878%-1.82000%	Short-term financing Short-term financing	$ - -	Operation requirements Operation requirements	$ - -	- -	$ - -	$ 31,609,005 31,609,005	$ 31,609,005 31,609,005	Note 2 Note 2
2	WMT	TWM TKT TFNM WTVB	Other receivables Other receivables Other receivables Other receivables	Yes Yes Yes Yes	3,800,000 100,000 2,150,000 1,200,000	3,414,000 100,000 2,000,000 800,000	3,179,000 - 600,000 490,000	0.86867%-1.50622% - 0.86856%-1.12000% 0.86856%-1.70378%	Short-term financing Short-term financing Short-term financing Short-term financing	- - - -	Operation requirements Operation requirements Operation requirements Operation requirements	- - - -	- - - -	- - - -	9,018,628 9,018,628 9,018,628 9,018,628	9,018,628 9,018,628 9,018,628 9,018,628	Note 2 Note 2 Note 2 Note 2
3	TFN	TWM TCC	Other receivables Other receivables	Yes Yes	11,000,000 700,000	11,000,000 700,000	9,413,000 291,000	0.86867%-1.70378% 0.86878%-1.52000%	Short-term financing Short-term financing	- -	Operation requirements Operation requirements	- -	- -	- -	20,615,466 20,615,466	20,615,466 20,615,466	Note 2 Note 2
4	YJCTV	TFNM	Other receivables	Yes	30,000	-	-	0.86878%	Transactions	405,951	-	-	-	-	405,951	405,951	Notes 3 and 4
5	PCTV	TFNM	Other receivables	Yes	520,000	520,000	520,000	0.86878%-1.49733%	Transactions	523,729	-	-	-	-	523,729	523,729	Notes 3 and 4
6	GCTV	TFNM	Other receivables	Yes	250,000	250,000	250,000	0.86878%-1.49733%	Short-term financing	-	Repayment of financing	-	-	-	283,647	283,647	Note 3

Note 1: The maximum balance for the period and the ending balance represent quotas, not actual drawdown.

67 -

TABLE 2

TAIWAN MOBILE CO., LTD.

ENDORSEMENT/GUARANTEE PROVIDED TO OTHER PARTIES FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

No.	Company Providing Endorsements/ Guarantees	Receiving Party	Receiving Party	Limits on Endorsements/ Guarantees Amount Provided to Each Entity	Maximum Balance for the Period (Note 1)	Ending Balance (Note 1)	Drawdown Amounts (Note 1)	Amount of Endorsements/ Guarantees Collateralized by Property	Ratio of Accumulated Endorsements/ Guarantees to Net Worth of the Guarantor (Note 1)	Maximum Endorsements/ Guarantees Amount Allowable	Guarantee Provided by Parent Company	Guarantee Provided by a Subsidiary	Guarantee Provided to Subsidiaries in Mainland China	Note
		Name	Nature of Relationship
0	TWM	TFN TKT TVC	Note 2 Note 2 Note 2	$ 42,000,000 313,800 8,550,000	$ 21,500,000 50,000 3,200,000	$ 21,500,000 50,000 3,200,000	$ 7,000,000 50,000 1,921,300	$ - - -	33.35 0.08 4.96	$ 64,470,756 64,470,756 64,470,756	Y Y Y	N N N	N N N	Note 3 Note 3 Note 3

Note 1: The maximum endorsement/guarantee balance for the period, the ending balance, and the drawdown amounts represent quotas, not actual drawdown.

Note 2: Direct/indirect subsidiary.

68 -

TABLE 3

TAIWAN MOBILE CO., LTD.

MARKETABLE SECURITIES HELD (EXCLUDING INVESTMENTS IN SUBSIDIARIES AND ASSOCIATES) DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Investing Company	Marketable Securities Type and Name	Relationship with the Securities Issuer	Financial Statement Account		At the End of the Period	At the End of the Period		Note
				Units/Shares (In Thousands)	Carrying Amount	Percentage of Ownership (%)	Fair Value
TWM TCC WMT TVC	Listed Stocks Chunghwa Telecom Co., Ltd. Unlisted Stocks LINE Bank Taiwan Limited Bridge Mobile Pte Ltd. Limited Partnerships Grand Academy Investment, L.P. Starview Heights Investment, L.P. Unlisted Stocks Arcoa Communication Co., Ltd. Limited Partnerships The Last Thieves, L.P. Listed Stocks 91APP, Inc. Unlisted Stocks 17LIVE INC. Jayawijaya Finance Limited FIGMENT INC. Stampede Entertainment, Inc. TIKI GLOBAL PTE. LTD. CARSOME GROUP INC. Cloud Mile Inc. SoundOn Global Limited BAM Management US Holdings Inc. LINE MAN CORPORATION PTE. LTD. Swift Navigation, Inc. Swift Navigation, Inc. Partipost Pte. Ltd. Taiwan Web Service Corporation	- - - - - - - - - - - - - - - - - - - - - -	Current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Current financial assets at FVTPL Non-current financial assets at FVTOCI Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI	2,174 75,000 800 - - 6,998 - 2,500 525 5 - 1,333 760 733 5,396 - 246 1,100 214 364 899 3,000	$ 245,607 674,999 30,137 1,108,681 101,607 91,046 - 260,000 18,773 150,734 4,458 401,422 516,856 39,943 573,943 15,100 129,484 273,391 29,819 50,692 26,855 16,284	0.028 5 10 21.67 21.67 5.21 7.14 2.12 0.2 6.24 0.09 7.51 2.39 0.34 18.2 1 0.12 0.95 0.3 0.5 2.53 4.48	$ 245,607 674,999 30,137 1,108,681 101,607 91,046 - 260,000 18,773 150,734 4,458 401,422 516,856 39,943 573,943 15,100 129,484 273,391 29,819 50,692 26,855 16,284	Note 1 Note 1 Note 1 Note 2 Note 2

(Continued)

69 -

Investing Company	Marketable Securities Type and Name	Relationship with the Securities Issuer	Financial Statement Account		At the End of the Period	At the End of the Period		Note
				Units/Shares (In Thousands)	Carrying Amount	Percentage of Ownership (%)	Fair Value
TVC TCCI TUI TID momo	Limited Partnerships AUM CREATIVE FUND II Linse Capital Fund I, L.P. LINSE CAPITAL SKY II LLC Northstar Equity Partners V Limited Pantera Blockchain Offshore Fund L.P. Pioneer Fund II L.P. Soma Capital Fund III, L.P. TOMORROW TOGETHER FUND Convertible Notes CARSOME GROUP INC. Listed Stocks TWM Unlisted Stocks Great Taipei Broadband Co., Ltd. Listed Stocks TWM Listed Stocks TWM Unlisted Stocks Media Asia Group Holdings Limited Gaius Automotive Inc. We Can Medicines Co., Ltd. LINE Bank Taiwan Limited	- - - - - - - - - TWM - TWM TWM - - - -	Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTPL Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Current financial assets at FVTOCI Non-current financial assets at FVTPL Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI	- - - - - - - - - 200,497 10,000 410,665 87,590 4,367 5,750 3,073 37,500	$ 16,365 66,786 92,074 213,175 91,516 82,465 66,182 19,119 126,280 18,987,043 38,639 38,890,003 8,294,731 4,217 237,546 65,988 337,499	16.05 0.89 2.67 1.72 0.32 13.58 1.21 23.53 - 5.7 6.67 11.67 2.49 0.15 8.02 7.68 2.5	$ 16,365 66,786 92,074 213,175 91,516 82,465 66,182 19,119 126,280 18,987,043 38,639 38,890,003 8,294,731 4,217 237,546 65,988 337,499	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1

Note 1: Percentage of ownership is the percentage of capital contribution.

Note 2: The shares held as of the period ended were fewer than 1,000 shares.

Note 3: For the information on investments in subsidiaries and associates, see Table 7 and Table 8 for details.

(Concluded)

70 -

TABLE 4

TAIWAN MOBILE CO., LTD.

MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST $300 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Company Name	Type and Name of Marketable Securities	Financial Statement Account	Counterparty	Relationship	Beginning Balance	Beginning Balance	Acquisition	Acquisition		Disposal	Disposal		Ending	Balance
					Units/Shares (In Thousands)	Amount	Units/Shares (In Thousands)	Amount	Units/Shares (In Thousands)	Amount	Carrying Amount	Gain (Loss) on Disposal	Units/Shares (In Thousands)	Amount (Note 1)
TWM TVC momo	Unlisted Stocks TVC LINE Bank Taiwan Limited Listed Stocks APT (Note 4) Unlisted Stocks Cloud Mile Inc. Unlisted Stocks LINE Bank Taiwan Limited	Investments accounted for using equity method Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI Non-current financial assets at FVTOCI	- - - - -	Subsidiary - - - -	217,500 50,000 97,171 - -	$ 2,736,210 408,139 798,745 - -	210,000 37,500 - 5,396 37,500	$ 2,100,000 375,000 - 443,459 375,000	- 12,500 (Note 3) 97,171 - -	$ - - 671,375 - -	$ - - 2,980,000 - -	$ - - (2,308,625) (Note 4) - -	433,051 (Note 2) 75,000 - 5,396 37,500	$ 4,604,998 674,999 - 573,943 337,499

Note 1: The ending balance included the relevant adjustments to share of profit of investments accounted for using equity method and financial assets.

Note 2: The ending balance of shares included the stock dividends, amounting to 5,551 thousand shares, received in the third quarter of 2022.

Note 4: TWM exercised appraisal right in the second quarter of 2022 and deposited all of the held interests. The valuation loss was transferred from other equity to retained earnings.

71 -

TABLE 5

TAIWAN MOBILE CO., LTD.

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES OF AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Company Name	Related Party	Nature of Relationship		Transaction Details	Transaction Details		Transactions with Terms Different from Others	Transactions with Terms Different from Others	Notes/Accounts Payable or Receivable	Notes/Accounts Payable or Receivable	Note
			Purchase/Sale	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
TWM TWM&TDS TNH TFN TT&T TPIA TFNM MCTV WTVB momo	TFN TPIA TFNM TKT momo Fubon Insurance TWM TFC TFNM kbro TWM Fubon Insurance YJCTV PCTV UCTV GCTV Dai-Ka kbro FSL MFS kbro	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Other related party Parent Fellow subsidiary Fellow subsidiary Other related party Ultimate parent Other related party Subsidiary Subsidiary Subsidiary Subsidiary Other related party Other related party Subsidiary Subsidiary Other related party	Sale Purchase Sale Purchase Purchase Sale Purchase Sale Sale Sale Sale Sale Sale Sale Channel leasing fee Channel leasing fee Channel leasing fee Channel leasing fee Royalty for copyright Sale Purchase Purchase Purchase	$ 155,456 5,043,666 200,317 179,116 239,396 3,041,736 239,239 294,662 126,354 153,384 217,377 379,556 956,348 338,431 372,043 484,014 215,586 174,174 155,992 194,132 907,150 203,739 132,202	- 11 - - 1 5 1 - 22 2 2 4 91 97 10 14 6 5 51 18 1 - -	Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms Based on contract terms	- - - - - - - - - - - - - - Note 1 Note 1 Note 1 Note 1 Note 1 - - - -	- - - - - - - - - - - - - - Note 1 Note 1 Note 1 Note 1 Note 1 - - - -	$ 23,524 (495,576) 80,109 (41,000) (45,184) 362,727 (18,512) 59,925 8,009 25,391 34,242 63,089 87,839 103,335 - - - - (30,769) 64,615 (254,317) (17,631) (51)	- Note 2 1 Note 2 2 5 1 1 59 2 3 6 91 96 - - - - 74 8 2 - -	Note 3 Note 3

Note 1: The companies authorized a related party to deal with the copyright fees for cable television. As the said account item is the only one, there is no comparable transaction.

Note 2: Including accounts payable and other payables.

Note 3: Accounts receivable (payable) was the net amount after being offset.

72 -

TABLE 6

TAIWAN MOBILE CO., LTD.

RECEIVABLES FROM RELATED PARTIES OF AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Company Name	Related Party	Nature of Relationship	Ending Balance	Ending Balance	Turnover Rate	Overdue	Overdue	Amount Received in Subsequent Period	Allowance for Impairment Loss
						Amount	Action Taken
TWM TCC WMT TFN TPIA PCTV GCTV momo FSL	momo TWM TFC TWM TFNM WTVB TWM TCC Fubon Insurance TFNM TFNM TWM TFCB momo	Subsidiary Parent Subsidiary Parent Subsidiary Subsidiary Ultimate parent Parent Other related party Parent Parent Ultimate parent Other related party Parent	Accounts receivable Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Accounts receivable Other receivables Other receivables Accounts receivable Accounts receivable Other receivables Accounts receivable Other receivables Accounts receivable Other receivables Accounts receivable Other receivables Accounts receivable	$ 362,727 95,724 413,731 291,842 3,193,040 600,608 491,156 501,644 9,488,405 291,703 103,335 6,092 520,036 2,481 250,002 50,391 66,042 233,631 279,185 254,851	9.15 10.81 3.42 7.22 7.11 11.89 Note 4.6	$ - - - - - - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - - - - - -	$ 357,446 29,513 - - 3,193,040 - 177 448,328 19,255 - 28,821 3.994 35 1,578 1 49,763 59,448 233,075 279,185 238,725	$ - - - - - - - - - - - - - - - - - - - -

Note: Not applicable due to the transaction partners and the nature of transactions.

73 -

TABLE 7

TAIWAN MOBILE CO., LTD.

NAMES, LOCATIONS AND RELATED INFORMATION OF INVESTEES ON WHICH TWM EXERCISED SIGNIFICANT INFLUENCE (EXCLUDING INFORMATION ON INVESTMENT IN MAINLAND CHINA) FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

Investor	Investee	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance at the End of the Period	Balance at the End of the Period	Balance at the End of the Period	Net Income (Loss) of the Investee	Investment Income (Loss)	Note
				December 31, 2022	December 31, 2021	Shares (In Thousands)	Percentage of Ownership (%)	Carrying Amount
TWM TCC WMT TVC TFN TCCI TWMFM TFNM	TCC WMT TVC TNH FSD AppWorks TFN TT&T TWM Holding TCCI TDS TPIA TFC TFNM GFMT GWMT WTVB momo TWMFM AppWorks Fund III NADA AppWorks Fund IV Uspace TUI TID SFF TKT YJCTV MCTV PCTV UCTV GCTV kbro Media	Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan British Virgin Islands Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan	Investment Investment Investment Building and operating Songshan Cultural and Creative Park BOT project Information services Venture capital, investment consulting, and management consulting Fixed line service provider Call center service and telephone marketing Investment Investment Commissioned maintenance services Property insurance agent Cloud and information services Type II telecommunications business Investment Investment TV program provider Wholesale and retail sales Film production Venture capital Animation production Venture capital Information software service Investment Investment Film production Digital music services Cable TV service provider Cable TV service provider Cable TV service provider Cable TV service provider Cable TV service provider Film distribution, arts and literature services, and entertainment	$ 40,397,288 16,871,894 4,275,000 1,918,655 30,000 235,000 21,000,000 56,210 347,951 17,285,441 25,000 5,000 200,000 5,210,443 16,984 92,189 222,417 8,129,394 11,300 583,292 60,000 105,000 200,030 22,314,609 3,603,149 300 156,900 2,061,522 510,724 3,261,073 1,986,250 1,221,002 341,250	$ 40,397,288 16,871,894 2,175,000 1,918,655 - 235,000 21,000,000 56,210 347,951 17,285,441 25,000 5,000 200,000 5,210,443 16,984 92,189 222,417 8,129,394 300 694,767 60,000 - - 22,314,609 3,603,149 - 156,900 2,061,522 510,724 3,261,073 1,986,250 1,221,002 341,250	502,970 42,065 433,051 191,866 3,000 2,168 2,100,000 2,484 - 154,721 2,500 500 20,000 230,921 1,500 8,945 18,177 98,354 1,130 57,877 4,286 - 5,969 400 104,712 30 14,700 33,940 6,248 68,090 169,141 51,733 21,994	100 100 100 49.9 100 51 100 100 100 100 100 100 100 100 100 100 100 45.01 100 20.14 37.93 32.86 32.90 100 100 100 100 100 29.53 100 99.22 92.38 33.58	$ 19,869,765 22,545,770 4,604,998 1,960,752 23,421 244,745 51,539,627 155,012 241,896 25,988,580 103,044 110,571 246,602 6,768,720 17,424 97,885 396,195 10,968,706 11,054 600,765 55,558 101,159 194,095 33,743,265 7,202,078 254 334,369 1,449,291 628,626 3,465,185 2,051,901 1,277,609 78,593	$ 3,905,482 3,173,222 120,947 115,316 (3,246) (18,337) 3,538,184 48,442 19,397 2,120 8,651 100,571 67,009 1,598,631 123 2,231 126,931 3,434,626 (184) 724,769 1,090 (13,309) (67,590) (76) (76) (46) 43,930 (61,672) 24,943 122,399 33,236 34,946 (149,709)	$ 3,906,214 3,172,668 120,947 56,350 (6,579) (10,213) - - - - - - - - - - - - - - - - - - - - - - - - - - -	Note 1 Note 1 Note 1 Note 1 Note 1 Note 2 Note 2 Notes 2 and 3 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Notes 2 and 4 Note 2 Note 2 Note 2 Note 2 and 5 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Notes 2 and 6 Note 2 Note 2 Note 2 Note 2

(Continued)

74 -

Investor	Investee	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance at the End of the Period	Balance at the End of the Period	Balance at the End of the Period	Net Income (Loss) of the Investee	Investment Income (Loss)	Note
				December 31, 2022	December 31, 2021	Shares (In Thousands)	Percentage of Ownership (%)	Carrying Amount
TKT GFMT GWMT momo Asian Crown (BVI) Fortune Kingdom Honest Development	M.E. UCTV GCTV Asian Crown (BVI) Honest Development FLI FPI FST Bebe Poshe FSL MFS Prosperous Living TV Direct Fortune Kingdom HK Fubon Multimedia HK Yue Numerous	Taiwan Taiwan Taiwan British Virgin Islands Samoa Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Thailand Samoa Hong Kong Hong Kong	Livestreaming artists management services and digital media production Cable TV service provider Cable TV service provider Investment Investment Life insurance agent Property insurance agent Travel agent Wholesale of cosmetics Logistics and transport Wholesaling Wholesale and retail sales Wholesale and retail sales Investment Investment Investment	$ 30,628 16,218 91,910 885,285 670,448 3,000 3,000 6,000 90,880 250,000 100,000 220,850 Note 8 1,132,789 1,132,789 670,448	$ 27,000 16,218 91,910 885,285 670,448 3,000 3,000 6,000 85,000 250,000 100,000 220,850 179,406 1,132,789 1,132,789 670,448	537 1,300 3,825 9,735 21,778 500 500 3,000 8,868 25,000 10,000 22,085 Note 8 11,594 11,594 16,600	11.33 0.76 6.83 81.99 100 100 100 100 88.68 100 100 73.62 Note 8 100 100 100	$ 33,110 15,775 96,447 17,506 560,502 2,922 12,983 46,612 27,953 374,472 98,399 223,833 Note 8 16,913 16,913 560,502	$ 21,884 33,236 34,946 (3,448) (99,495) (2,280) 3,515 5,577 (5,790) 118,512 (2,380) 4,232 Note 8 (3,834) (3,834) (99,495)	$ - - - - - - - - - - - - - - - -	Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Notes 2 and 7 Note 2 Note 2 Note 2 Note 2 Note 2 Notes 2 and 8 Note 2 Note 2 Note 2

Note 1: Downstream transactions, upstream transactions, and consolidated unrealized gain or loss are included.

Note 2: The income/loss of the investee was already included in the income/loss of the investor, and is not presented in this table.

Note 3: Held 1 share as of period end.

Note 4: Material non-controlling interests.

Note 5: Percentage of ownership is the percentage of capital contribution.

Note 6: 70.47% of stocks are held under trustee accounts.

Note 7: Renamed as Fuli Insurance Agent Co., Ltd. in February 2023, and changed its main business to comprehensive insurance agent.

Note 8: momo sold all of its equity interest of TV Direct in August 2022.

Note 9: For information on investments in mainland China, see Table 8 for the details.

(Concluded)

75 -

TABLE 8

TAIWAN MOBILE CO., LTD.

INVESTMENTS IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars and Foreign Currencies)

Investee Company Name	Main Businesses and Products	Main Businesses and Products	Total Amount of Paid-in Capital	Total Amount of Paid-in Capital	Investment Type (Note 1)	Accumulated Outflow of Investment from Taiwan at the Beginning of the Period	Accumulated Outflow of Investment from Taiwan at the Beginning of the Period	Investment Flows	Investment Flows	Accumulated Outflow of Investment from Taiwan at the End of the Period	Net Income (Loss) of Investee	% Ownership through Direct or Indirect Investment	Investment Income (Loss)	Carrying Value at the End of the Period	Accumulated Inward Remittance of Earnings at the End of the Period
								Outflow	Inflow
TWMC FGE Haobo GHS	Data communication application development Wholesaling Investment Wholesaling		$ 92,175 (USD 3,000) 341,076 (RMB 77,500) 48,411 (RMB 11,000) 220,049 (RMB 50,000)		b b b b	$ 149,689 (USD 4,872) 823,012 (USD 14,000) (RMB 89,267) - -		$ - - - -	$ - - - -	$ 149,689 (USD 4,872) 823,012 (USD 14,000) (RMB 89,267) - -	$ 1,381 (4,943) (100,135) 61,451	100 76.7 100 20	$ 1,381 (3,791) (100,135) (19,073)	$ 83,402 6,976 531,879 486,008	$ - - - -

Company		Accumulated Investment in Mainland China at the End of the Period		Investment Amounts Authorized by Investment Commission, MOEA			Upper Limit on Investment Authorized by Investment Commission, MOEA (Note 2)
TWM and subsidiaries		$1,637,082 (USD18,872, RMB89,267 and HKD168,539)		$1,637,082 (USD18,872, RMB89,267 and HKD168,539)			$43,710,468

Note 1: The investment types are as follows:

a. Direct investment in mainland China.

b. Indirect investments in mainland China through subsidiaries, invested by TCC and momo, in third regions.

c. Others.

Note 2: The upper limit on investment in mainland China is calculated by 60% of the consolidated net worth.

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TABLE 9

TAIWAN MOBILE CO., LTD

INFORMATION OF MAJOR STOCKHOLDERS DECEMBER 31, 2022

Name of Major Stockholder	Shares	Shares
	Number of Shares	Percentage of Ownership (%)
TUI Shin Kong Life Insurance Co., Ltd. TCCI Cathay Life Insurance Co., Ltd. Ming Dong	410,665,284 251,723,000 200,496,761 188,343,900 184,736,452	11.67 7.15 5.70 5.35 5.25

Note: The table discloses the information of major stockholders whose stockholding percentages are more than 5%. The Taiwan Depository & Clearing Corporation calculates the total number of common stocks and preferred stocks (including treasury stocks) that have completed the dematerialized registration and delivery on the last business day of the quarter.

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THE CONTENTS OF STATEMENTS OF MAJOR ACCOUNTING ITEMS

ITEM STATEMENT INDEX

MAJOR ACCOUNTING ITEMS IN ASSETS, LIABILITIES AND
EQUITY
STATEMENT OF CASH AND CASH EQUIVALENTS	1
STATEMENT OF NOTES AND ACCOUNTS RECEIVABLE, NET	2
STATEMENT OF CHANGES IN INVESTMENTS ACCOUNTED	3
FOR USING EQUITY METHOD
STATEMENT OF CHANGES IN PROPERTY, PLANT AND	Note 11
EQUIPMENT
STATEMENT OF CHANGES IN RIGHT-OF-USE ASSETS	4
STATEMENT OF CHANGES IN INTANGIBLE ASSETS	Note 14
STATEMENT OF SHORT-TERM BORROWINGS	5
STATEMENT OF SHORT-TERM NOTES AND BILLS PAYABLE	6
STATEMENT OF ACCOUNTS PAYABLE	7
STATEMENT OF OTHER PAYABLES	8
STATEMENT OF BONDS PAYABLE	Note 17
STATEMENT OF LONG-TERM BORROWINGS	9
STATEMENT OF LEASE LIABILITIES	10
MAJOR ACCOUNTING ITEMS IN PROFIT OR LOSS
STATEMENT OF OPERATING REVENUES	Note 21
STATEMENT OF OPERATING COSTS	11
STATEMENT OF MARKETING AND ADMINISTRATIVE	12
EXPENSES
STATEMENT OF FINANCE COSTS	Note 22(b)
STATEMENT OF LABOR, DEPRECIATION AND	Note 32
AMORTIZATION BY FUNCTION

78 -

STATEMENT 1

TAIWAN MOBILE CO., LTD.

STATEMENT OF CASH AND CASH EQUIVALENTS DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars, Unless Specified Otherwise)

Item Summary Cash on hand and revolving funds Cash in banks Demand deposits Foreign currency deposits (US$26,583 thousand, at an exchange rate of $30.725) (EUR60 thousand, at an exchange rate of $32.65) Checking account deposits	Amount $ 80,905 1,272,353 816,754 1,974 5,472 2,096,553 $ 2,177,458

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STATEMENT 2

TAIWAN MOBILE CO., LTD.

STATEMENT OF NOTES AND ACCOUNTS RECEIVABLE, NET DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Client Name Others (Note) Less: Allowance for impairment loss	Amount $ 6,452,979 (379,768) $ 6,073,211

Note: The amount of each client was less than 5% of the account balance.

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STATEMENT 3

TAIWAN MOBILE CO., LTD.

STATEMENT OF CHANGES IN INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD FOR THE YEAR ENDED DECEMBER 31, 2022

(In Thousands of New Taiwan Dollars)

TCC WMT TVC TNH FSD AppWorks	Beginning Balance Shares (In Thousands) Amount 520,970 $ 18,772,200 42,065 22,266,600 217,500 2,736,210 191,866 1,904,402 - - 1,275 270,997 $ 45,950,409	Increase in Investment (Note 1) Shares (In Thousands) Amount - $ - - - 215,551 2,100,000 - - 3,000 30,000 893 - $ 2,130,000	Adjustments of Investments Accounted for Decrease in Investment (Note 2) Using Shares Equity Method (In Thousands) Amount (Note 3) - $ (2,863,599) $ 3,961,164 - (2,906,761) 3,185,931 - (1) (231,211) - - 56,350 - - (6,579) - - (26,252) $ (5,770,361) $ 6,939,403	Ending Balance	Market Value or Net Assets Amount Value $ 19,869,765 $ 79,022,513 22,545,770 22,546,570 4,604,998 4,604,998 1,960,752 1,957,990 23,421 26,754 244,745 9,665 $ 49,249,451
	Shares (In Thousands) 520,970 42,065 217,500 191,866 - 1,275	Shares (In Thousands) - - 215,551 - 3,000 893	Shares (In Thousands) - - - - - -	Shares Percentage of (In Thousands) Ownership % 502,970 100 42,065 100 433,051 100 191,866 49.9 3,000 100 2,168 51

Note 1: The increase in investments mainly resulted from cash capital increase or receiving share dividends.

Note 2: The decrease in investments mainly resulted from receiving cash dividends.

Note 3: The adjustments of investments accounted for using equity method include the share of the profit or loss and other comprehensive income of investees, changes in equity accounted for using equity method and unrealized gain or loss on upstream and downstream intercompany transactions.

Note 4: None of the investments accounted for using equity method was provided as collateral.

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STATEMENT 4

TAIWAN MOBILE CO., LTD.

STATEMENT OF CHANGES IN RIGHT-OF-USE ASSETS FOR THE YEAR ENDED DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Cost Balance, January 1, 2022 Additions Remeasurement of lease liabilities Deductions Others Balance, December 31, 2022 Accumulated depreciation Balance, January 1, 2022 Depreciation Deductions Balance, December 31, 2022 Carrying amount, December 31, 2022	Land $ 983,333 365,701 503 (247,818) (312) $ 1,101,407 $ 492,885 235,148 (235,836) $ 492,197 $ 609,210	Buildings Telecommuni- cations Equipment and Machinery $ 12,794,585 $ 509,179 3,895,176 27,827 (6,200) 4,172 (2,972,402) (18,783) (1,206) - $ 13,709,953 $ 522,395 $ 6,325,750 $ 235,052 3,065,596 87,059 (2,760,895) (9,760) $ 6,630,451 $ 312,351 $ 7,079,502 $ 210,044	Others $ 171,056 15,953 - (17,669) - $ 169,340 $ 77,438 38,068 (16,404) $ 99,102 $ 70,238	Total $ 14,458,153 4,304,657 (1,525) (3,256,672) (1,518) $ 15,503,095 $ 7,131,125 3,425,871 (3,022,895) $ 7,534,101 $ 7,968,994

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STATEMENT 5

TAIWAN MOBILE CO., LTD.

STATEMENT OF SHORT-TERM BORROWINGS DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Loan Type Unsecured - bank Unsecured - related parties TFN WMT TCC	Amount Contract Period Interest Rates Loan Commitments Collateral $ 19,300,000 2022.10.28-2023.5.26 1.53%-1.65% $ 60,071,000 None 9,413,000 2022.5.6-2023.5.5 11,000,000 None 3,179,000 2022.1.27-2023.4.21 0.87%-1.70378% 3,800,000 None 413,000 2022.5.6-2023.5.5 500,000 None 13,005,000 15,300,000 $ 32,305,000 $ 75,371,000

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STATEMENT 6

TAIWAN MOBILE CO., LTD.

STATEMENT OF SHORT-TERM NOTES AND BILLS PAYABLE DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Item Institution Providing Guarantee or Acceptance Contract Period Interest Rates Issuing Amount S an Commercial papers payable China Bills Finance Corporation 2022.11.28-2023.2.24 1.658% $ 3,100,000	Discount on hort-term Notes d Bills Payable Ne $ 7,605	t Carrying Value $ 3,092,395

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STATEMENT 7

TAIWAN MOBILE CO., LTD.

STATEMENT OF ACCOUNTS PAYABLE DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Vendor Name Company A Company B Company C Others (Note)	Amount $ 749,257 231,847 115,834 825,675 $ 1,922,613

Note: The amount of each vendor was less than 5% of the total account balance.

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STATEMENT 8

TAIWAN MOBILE CO., LTD.

STATEMENT OF OTHER PAYABLES DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Item Equipment and construction Salaries and pension Estimated loss from lawsuits Repair and maintenance expense Rents and utilities expense Commissions Others (Note)	Amount $ 2,091,425 1,366,339 765,779 708,597 677,877 396,078 1,589,770 $ 7,595,865

Note: The amount of each item was less than 5% of the total account balance.

86 -

STATEMENT 9

TAIWAN MOBILE CO., LTD.

STATEMENT OF LONG-TERM BORROWINGS DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Institution Providing Guarantee or Acceptance Commercial papers payable China Bills Finance Corporation Yuanta Commercial Bank Mega Bill Finance Corporation Less: Current portion	Amount Contract Period Interest Rates Collateral $ 4,496,902 2022.6.2-2025.6.1 None 1,999,849 2020.12.31-2023.12.31 0.688%-1.81% None 1,499,746 2020.12.25-2023.12.25 None (3,499,595) $ 4,496,902

87 -

STATEMENT 10

TAIWAN MOBILE CO., LTD.

STATEMENT OF LEASE LIABILITIES DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Item (Target) Lease Terms Discount Rates Land 1-19 years 0.61%-1% Buildings 1-10 years 0.61%-1% Telecommunications equipment and machinery 6 years 0.79%-1% Others 1-5 years 0.62%-0.86%	Amount $ 607,585 7,096,075 221,790 70,921 $ 7,996,371

88 -

STATEMENT 11

TAIWAN MOBILE CO., LTD.

STATEMENT OF OPERATING COSTS FOR THE YEAR ENDED DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Item Cost of goods sold Depreciation Interconnecting cost (Note 1) Government fees (Note 2) Others (Note 3)	Amount $ 20,472,303 8,625,335 7,104,189 4,709,271 5,320,550 $ 46,231,648

Note 1: The amount includes dedicated line and interconnecting charges paid to other telecommunication service providers.
Note 2: The amount includes the NCC’s frequency usage fees, number selections fees, amortization of concession fees, etc.
Note 3: The amount of each item was less than 5% of the total account balance.
89 -

STATEMENT 12

TAIWAN MOBILE CO., LTD.

STATEMENT OF MARKETING AND ADMINISTRATIVE EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2022 (In Thousands of New Taiwan Dollars)

Item Salaries and pension Professional service fees Amortization Depreciation Commissions and mobile phone subsidies Service charges Others (Note)	Marketing Administrative $ 1,583,457 $ 1,115,490 1,249,297 235,918 1,204,086 124,209 532,334 221,741 695,454 - 242,916 335,515 1,060,708 765,460 $ 6,568,252 $ 2,798,333	Total $ 2,698,947 1,485,215 1,328,295 754,075 695,454 578,431 1,826,168 $ 9,366,585

Note: The amount of each item was less than 5% of the total account balance.

90 -

AI assistant

TWM — Annual Report 2022

52277_rns_2023-07-13_ecd717ef-6a5e-4a63-9965-eca872a20273.pdf

Disclaimer

Contents

Letter to shareholders

Dear Shareholders,

2022 operating and financial results

New business roadmap and group resources integration

Innovative applications and research results

World-class corporate governance

Valuing shareholders' interests and customer satisfaction

Corporate social responsibility

Outlook

Chapter 1 Company Highlights

I. Vision

II. Core Competitiveness

⚫ momo coin ecosystem to cement corporate synergy

⚫ Innovative multiple proprietary packages, Double Play and OP Life

⚫ Strong corporate digital transition partner with expanding 5G ecosystem

⚫ AI-supported infrastructure layout offers the best 5G user experience

⚫ TWM Anti-phishing enhances cybersecurity to combat fraud

⚫ Building a happy workplace and nurturing interdisciplinary talent

⚫ An ESG role model that prioritizes sustainability

III. Brand Values

Brand Spirit

Brand Personality

IV. Date of Incorporation

V. Significant Events

Status of mergers and acquisitions and affiliated companies

Changes in shareholdings of directors and major shareholders

Other matters of material significance that could affect shareholders' equity and the Company: None

Awards and recognitions from 2022 up to the publication date in 2023

Milestones

Chapter 2 Organization and Corporate Governance

Organization

Organization Chart

Divisional Scope of Responsibilities

Board of Directors and Executive Management

Board of Directors

Note: Zero shareholdings are denoted as “–”.

Major shareholders of companies mentioned on the right hand side of the table above

2. Qualifications and independence criteria of directors

3. Board diversity and independence

Management Team

Compensation to Directors and Management Executives

1. Directors’ compensation

2. Range of compensation to directors

3. Management executives’ compensation

4. Range of compensation to management executives

5. Compensation mix of management executives

6. Employee profit sharing paid to management executives

Compensation of directors and management executives as a percentage of net income over the past two years and guiding principles

1. Directors’ compensation

Guiding principles for compensation of directors

Remuneration policies, standards and package

Procedures for setting remuneration

Performance factor

2. Compensation of management executives

Guiding principles for compensation of management executives

Remuneration policies, standards and package

Procedures for setting performance bonuses

Performance factor

Corporate Governance

Board of Directors attendance

The Board of Directors convened six meetings in 2022

1. Any objections or issues raised by independent directors against resolutions passed by the Board of Directors:

(1) Pursuant to Article 14-3 of the Securities and Exchange Act:

2. Any recusals due to conflicts of interest:

3. Information regarding the implementation of the evaluation of the BoD and functional committees

4. Other BoD objectives:

Audit Committee attendance

The Audit Committee is responsible for reviewing the following:

1. The Audit Committee convened six times in 2022

2. Any objections or issues raised by the Audit Committee against resolutions passed by the Board of Directors

Corporate governance practices

Additional information

1. Employee rights

2. Employee care

3. Investor relations

TWM Annual Report 2022