TXC — Audit Report / Information 2023

Nov 13, 2023

TXC Corporation and Subsidiaries

Consolidated Financial Statements for the Years Ended December 31, 2023 and 2022 and Independent Auditors’ Report

DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

The companies required to be included in the consolidated financial statements of affiliates in accordance with the “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” for the year ended December 31, 2023 are all the same as the companies required to be included in the consolidated financial statements of parent and subsidiary companies as provided in International Financial Reporting Standard 10 “Consolidated and Separate Financial Statements”. Relevant information that should be disclosed in the consolidated financial statements of affiliates has all been disclosed in the consolidated financial statements of parent and subsidiary companies. Hence, we do not prepare a separate set of consolidated financial statements of affiliates.

Very truly yours,

TXC CORPORATION

By

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PETER LIN Chairman March 11, 2024

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders TXC Corporation

Opinion

We have audited the accompanying consolidated financial statements of TXC Corporation and its subsidiaries (collectively referred to as the “Group”), which comprise the consolidated balance sheets as of December 31, 2023 and 2022, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of material accounting policy information (collectively referred to as the “consolidated financial statements”).

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, 2023 and 2022, 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 of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements for the year ended December 31, 2023. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

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The key audit matter identified in the Group’s consolidated financial statements for the year ended December 31, 2023 is stated as follows:

For the year ended December 31, 2023, the Group’s revenue was approximately 18% less compared to its revenue for the year ended December 31, 2022. In comparison with 2022, the revenue derived from specific customers increased; therefore, we considered the occurrence of revenue derived from specific customers as a key audit matter. For the accounting policy for revenue recognition, please refer to Note 4.

The key audit procedures that we performed included the following:

1. We obtained an understanding of and tested the appropriateness of the design and the implementation of internal control system that is related to revenue recognition.

2. We selected samples from the revenue details of specific customers, checked the sales orders, and delivery notes, and we confirmed the occurrence of the sales revenue.

Other Matter

We have audited the accompanying parent company only financial statements of TXC Corporation as of December 31, 2023 and 2022 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 International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

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

2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

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

4. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.

5. Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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

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The engagement partners on the audits resulting in this independent auditors’ report are Ming-Chung Hsieh and Yu-Shiou Su.

Deloitte & Touche Taipei, Taiwan Republic of China

March 11, 2024

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 the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are those generally applied in the Republic of China.

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 Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ report and consolidated financial statements shall prevail.

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TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2023 AND 2022

(In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 4 and 6) Financial assets at fair value through profit or loss - current (Notes 4, 7 and 29) Financial assets at amortized cost - current (Notes 4 and 9) Notes receivable (Notes 4 and 10) Trade receivables (Notes 4 and 10) Trade receivables from related parties (Notes 4, 10 and 30) Finance lease receivables - current (Note 11) Other receivables (Note 4) Other receivables from related parties (Notes 4 and 30) Current tax assets (Notes 4 and 25) Inventories (Notes 4 and 11) Other current assets Total current assets NON-CURRENT ASSETS Financial assets at fair value through other comprehensive income - non-current (Notes 4, 8 and 29) Financial assets measured at amortized cost - non-current (Notes 4 and 9) Investments accounted for using equity method (Notes 4 and 14) Property, plant and equipment (Notes 4 and 15) Right-of-use assets (Notes 4 and 16) Investment properties (Notes 4 and 17) Other intangible assets (Note 4) Deferred tax assets (Notes 4 and 25) Finance lease receivables - non-current (Note 11) Prepayment for equipment Other non-current assets Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 18) Financial liabilities at fair value through profit or loss - current (Notes 4, 7 and 29) Contract liabilities - current (Notes 12 and 23) Trade payables Trade payables to related parties (Note 30) Other payables (Note 20) Other payables to related parties (Note 30) Current tax liabilities (Notes 4 and 25) Lease liabilities - current (Notes 4 and 16) Deferred revenue - current (Notes 20 and 27) Current portion of long-term liabilities (Note 18) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Note 19) Long-term borrowings (Note 18) Deferred tax liabilities (Notes 4 and 25) Lease liabilities - non-current (Notes 4 and 16) Deferred revenue - non-current (Notes 20 and 27) Net defined benefit liabilities - non-current (Notes 4 and 21) Guarantee deposits received Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT (Note 22) Share capital Ordinary shares Bond conversion entitlement certificates Total share capital Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Exchange differences on translating the financial statements of foreign operations Unrealized gain on financial assets at fair value through other comprehensive income Total other equity Total equity TOTAL		2023 Amount % $ 4,204,269 22 619,050 3 99,349 1 87,571 - 3,159,403 17 8,377 - 4,052 - 32,041 - 1,193 - 17,525 - 2,469,993 13 109,199 1 10,812,022 57 375,757 2 199,107 1 446,126 3 5,770,331 31 196,240 1 540,242 3 50,795 - 67,308 - 6,741 - 348,019 2 9,689 - 8,010,355 43 $ 18,822,377 100 $ 241,618 1 18,323 - 40 - 1,414,958 8 970 - 1,101,594 6 1,989 - - - 5,958 - 39,565 - 1,875,612 10 67,648 - 4,768,275 25 - - 1,882,765 10 111,792 1 6,714 - 79,319 - 20,105 - 79,791 1 2,180,486 12 6,948,761 37 3,097,570 17 9 - 3,097,579 17 1,718,693 9 2,243,247 12 143,071 1 5,198,793 27 7,585,111 40 (582,706) (3) 54,939 - (527,767) (3) 11,873,616 63 $ 18,822,377 100		2022
				Amount % $ 4,222,610 21 417,450 2 351,977 2 32,125 - 3,514,781 18 9,851 - - - 65,288 - 643 - - - 2,699,721 14 98,005 - 11,412,451 57 662,533 4 - - 458,607 2 6,319,742 32 205,984 1 571,346 3 53,838 - 61,271 - - - 94,538 1 10,934 - 8,438,793 43 $ 19,851,244 100 $ 513,750 3 13,620 - 40 - 1,208,497 6 622 - 1,421,979 7 1,250 - 204,057 1 3,088 - 38,817 - 890,785 5 39,206 - 4,335,711 22 1,183,273 6 1,522,600 8 118,132 1 3,399 - 108,191 - 35,203 - 71,527 - 3,042,325 15 7,378,036 37 3,097,570 16 - - 3,097,570 16 1,709,979 9 1,946,812 10 - - 5,861,917 29 7,808,729 39 (450,523) (2) 307,453 1 (143,070) (1) 12,473,208 63 $ 19,851,244 100

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

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TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

SALES (Note 23) COST OF GOODS SOLD (Note 24) GROSS PROFIT OPERATING EXPENSES (Note 24) Selling and marketing expenses General and administrative expenses Research and development expenses Expected credit loss gain reversal of trade receivables Total operating expenses PROFIT FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES Interest income (Note 24) Other income (Note 24) Other gains and losses (Note 24) Finance costs (Note 24) Shares of profits of associates and joint ventures (Note 14) Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Note 25) NET PROFIT FOR THE YEAR		2023 Amount % $ 10,850,402 100 (6,990,395) (65) 3,860,007 35 446,702 4 593,830 5 950,460 9 (6) - 1,990,986 18 1,869,021 17 77,204 1 163,029 2 7,038 - (57,619) (1) 4,573 - 194,225 2 2,063,246 19 (349,544) (3) 1,713,702 16		2022
				Amount % $ 13,169,688 100 (8,138,850) (62) 5,030,838 38 527,312 4 653,187 5 1,039,164 8 (39) - 2,219,624 17 2,811,214 21 27,435 - 173,762 1 392,657 3 (48,847) - 17,126 - 562,133 4 3,373,347 25 (567,843) (4) 2,805,504 21

(Continued)

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TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE (LOSS) INCOME Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit plans Unrealized loss on investments in equity instruments at fair value through other comprehensive income Share of the other comprehensive income of associates and join ventures accounted for using the equity method Items that may be reclassified subsequently to profit or loss: Exchange differences on translating the financial statements of foreign operations Share of the other comprehensive (loss) income of associates and join ventures accounted for using the equity method Other comprehensive loss for the year, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE YEAR EARNINGS PER SHARE (Note 26) From continuing and discounted operations Basic Diluted		2023 Amount % $ 3,030 - (24,632) - 67 - (21,535) - (127,850) (2) (4,333) - (132,183) (2) (153,718) (2) $ 1,559,984 14 $ 5.53 $ 5.33		2022
				Amount % $ 11,609 - (902,903) (7) 231 - (891,063) (7) 106,056 1 3,000 - 109,056 1 (782,007) (6) $ 2,023,497 15 $ 9.06 $ 8.68
		$		$

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

(Concluded)

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TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars)

BALANCE AT JANUARY 1, 2022 Appropriation of 2021 earnings (Note 22) Legal reserve appropriated Special reserve Cash dividends distributed by the Company Net profit for the year ended December 31, 2022 Other comprehensive income (loss) for the year ended December 31, 2022, net of income tax Total comprehensive income (loss) for the year ended December 31, 2022 Disposal of investments in equity instruments designated as at fair value through other comprehensive income Donation from shareholders Changes in capital surplus from investment in associates and joint ventures accounted for using the equity method BALANCE AT DECEMBER 31, 2022 Appropriation of 2022 earnings (Note 22) Legal reserve appropriated Special reserve Cash dividends distributed by the company Net profit for the year ended December 31, 2023 Other comprehensive income (loss) for the year ended December 31, 2023, net of income tax Total comprehensive income (loss) for the year ended December 31, 2023 Disposal of investments in equity instruments designated as at fair value through other comprehensive income Equity component of convertible bonds issued by the Company Donation from shareholders Changes in capital surplus from investment in associates and joint ventures accounted for using the equity method BALANCE AT DECEMBER 31, 2023		Equity Attributable to Owners of the Parent	Equity Attributable to Owners of the Parent	Others Unrealized Gain Exchange (Loss) on Differences on Financial Assets Translating the at Fair Value Financial Through Other Statements of Comprehensive Foreign Operations Income $ (559,579) $ 1,357,362 - - - - - - - - 109,056 (902,935) 109,056 (902,935) - (146,974) - - - - (450,523) 307,453 - - - - - - - - (132,183) (24,704) (132,183) (24,704) - (227,810) - - - - - - $ (582,706) $ 54,939	Total Equity $ 12,759,694 - - (2,323,178) 2,805,504 (782,007) 2,023,497 - 280 12,915 12,473,208 - - (2,168,299) 1,713,702 (153,718) 1,559,984 - 100 269 8,354 $ 11,873,616
	Shares (In Thousands) 309,757 - - - - - - - - - 309,757 - - - - - - - 1 - - 309,758	Share Capital Bond Conversion Entitlement Ordinary Shares Certificates Capital Surplus $ 3,097,570 $ - $ 1,696,784 - - - - - - - - - - - - - - - - - - - - - - - 280 - - 12,915 3,097,570 - 1,709,979 - - - - - - - - - - - - - - - - - - - - - - 9 91 - - 269 - - 8,354 $ 3,097,570 $ 9 $ 1,718,693	Retained Earnings Unappropriated Legal Reserve Special Reserve Earnings $ 1,635,942 $ 346,761 $ 5,184,854 310,870 - (310,870) - (346,761) 346,761 - - (2,323,178) - - 2,805,504 - - 11,872 - - 2,817,376 - - 146,974 - - - - - - 1,946,812 - 5,861,917 296,435 - (296,435) - 143,071 (143,071) - - (2,168,299) - - 1,713,702 - - 3,169 - - 1,716,871 - - 227,810 - - - - - - - - - $ 2,243,247 $ 143,071 $ 5,198,793

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

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TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expenses Amortization expenses Expected credit loss (reversed) recognized on trade receivables Net gain on fair value change of financial assets and liabilities at fair value through profit or loss Finance costs Interest income Dividend income Share of profit of associates and joint ventures Gain on disposal of property, plant and equipment Impairment losses recognized on property, plant and equipment Loss on disposal of non-current assets held for sale Write-down of inventories Gain on modifications of lease Changes in operating assets and liabilities Notes receivable Trade receivables Trade receivables from related parties Other receivables Other receivables from related parties Inventories Other current assets Contract liabilities - current Trade payables Trade payables to related parties Other payables Other payables to related parties Other current liabilities Net defined benefit liabilities Deferred revenue Cash generated from operations Interest paid Income tax paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of financial assets at fair value through profit or loss Proceeds from sale of financial assets/liabilities at fair value through profit or loss	2023 $ 2,063,246 1,210,381 17,790 (6) (1,729) 57,619 (77,204) (12,561) (4,573) (1,527) 3,234 - 13,277 (7) (55,440) 355,433 1,474 33,728 (550) 216,970 (11,194) - 206,461 348 (317,731) 739 28,442 (11,310) (32,077) 3,683,233 (46,426) (583,324) 3,053,483 (204,378) -	2022 $ 3,373,347 1,225,810 22,825 (39) (3,869) 48,847 (27,435) (11,486) (17,126) (7,560) 1,749 249 18,949 - (27,446) 489,630 21,043 39,857 536 (265,192) 25,474 (10,774) (787,821) (1,518) (57,776) (2,245) 18,092 (12,074) 18,544 4,072,591 (37,852) (684,306) 3,350,433 - 334,526 (Continued)

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TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars)

Purchase of financial assets at fair value through other comprehensive income Proceeds from sale of financial assets at fair value through other comprehensive income Purchase of financial assets at amortized cost Proceeds from sale of financial assets at amortized cost Purchase of investments accounted for using the equity method Proceeds from disposal of non-current assets held for sale Payments for property, plant and equipment Proceeds from disposal of property, plant and equipment Payments for intangible assets Decrease in other non-current assets Decrease in finance lease receivables Increase in prepayment for equipment Interest received Dividends received Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Repayments of short-term borrowings Decrease in short-term borrowings Proceeds from long-term borrowings Repayments of long-term borrowings Proceeds of guarantee deposits received Repayment of the principal portion of lease liabilities Dividends paid to owners of the company Other changes in capital surplus Net cash used in financing activities EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH HELD IN FOREIGN CURRENCIES NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	2023 $ (40,435) 299,306 - 38,095 - - (709,616) 39,386 (13,394) 1,245 4,367 (253,481) 76,843 32,686 (729,376) (255,733) - 1,704,099 (1,548,006) 8,264 (26,152) (2,168,299) 269 (2,285,558) (56,890) (18,341) 4,222,610 $ 4,204,269	2022 $ (25,359) 178,498 (63,561) - (11,185) 1,745 (1,242,411) 13,637 (23,748) 6,424 - - 27,338 29,090 (775,006) (68,615) (88,631) 914,867 (465,533) 1,037 (3,051) (2,323,178) 280 (2,032,824) 48,362 590,965 3,631,645 $ 4,222,610

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, 2023 AND 2022 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

TXC CORPORATION AND SUBSIDIARIES

1. GENERAL INFORMATION

TXC Corporation (the “Company”) was incorporated in the Republic of China (ROC) on December 28, 1983.

TXC specializes in producing high quality crystals and crystal oscillator (CXO) as well as develops a variety of sensors by core technology to satisfy the market demand. Sensors are applied to various applications including mobile communication, information and storage device, internet of things, vehicle electronics, telecommunication equipment, smart home, AI, medical care, and 5G, etc.

TXC’s shares have been listed on the Taiwan Stock Exchange since August 26, 2002.

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

To ensure the rights and interests of investors through full disclosure of operational governance, the Company applied for the Corporate Governance Assessment held by the Taiwan Corporate Governance Association (TCGA). For the “Corporate Governance Evaluation” jointly held by the Taiwan Stock Exchange Corporation (TWSE) and Taipei Exchange, under the category of listed companies, the company was awarded as the top 20 percent in 2014, top 5 percent from 2015 to 2017, and top 6 to 20 percent from 2018 to 2022. The Company will continue to strengthen corporate governance with the intention to achieve international standards for protection of public interest. Since 2009, the Company prepared Corporate Social Responsibility Report in accordance with GRI Standards every year, officially established ESG Committee in 2021. Meanwhile, The Company prepared ESG Report to acquire the third party (BSI) certification, initially introduced TCFD and SASB, implemented sustainable development based on scientific methods which met international mainstream, and implementation of human rights equality, gender-friendly workplace and fulfilled the responsibilities as a global citizen. Moreover, the Company actively responds to climate change issues, had established an ISO50001 energy management system, completed the interrogation of ISO14064-1 organizational greenhouse gas, and had begun to implement the interrogation of ISO14067 product carbon footprint. The Company comprehensively applying systematic management methods, collecting and monitoring the energy data, and through self-consumption of electricity and renewable energy procurement, to promote the efficient implementation of energy conservation and emission reduction through multiple channels. All of the above are the efforts that The Company made to replace Corporate Social Responsibility Report to reinforce its operation sustainable development, the implement of energy saving and emission reducing, developing gender-friendly workplace, and fulfilling responsibilities for social benefit.

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved by the Company’s board of directors on March 11, 2024.

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

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

The initial application of the IFRS Accounting Standards endorsed and issued into effect by the FSC did not have material impact on the Group’s accounting policies.

• b. The IFRS Accounting Standards endorsed by the FSC for application starting from 2024

New IFRS Accounting Standards Amendments to IFRS 16 “Lease 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” Amendments to IAS 7 and IFRS 7 “Supplier Finance Arrangements”	Effective Date Announced by IASB (Note 1)
	January 1, 2024 (Note 2) January 1, 2024 January 1, 2024 January 1, 2024 (Note 3)

• Note 1: Unless stated otherwise, the above IFRS Accounting Standards will be 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.

• Note 3: The amendments provide some transition relief regarding disclosure requirements.

• 1) Amendments to IFRS 16 “Leases Liability in a Sale and Leaseback”

The amendments clarify that the liability that arises from a sale and leaseback transaction - that satisfies the requirements in IFRS 15 to be accounted for as a sale - is a lease liability to which IFRS 16 applies. However, if the lease in a leaseback that includes variable lease payments that do not depend on an index or rate, the seller-lessee shall measure lease liabilities arising from a leaseback in a way that it does not recognize any amount of the gain or loss that relates to the right of use it retains. Seller-lessee subsequently recognizes in profit or loss the difference between the payments made for the lease and the lease payments that reduce the carrying amount of the lease liability.

• 2) Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” (referred to as the “2020 amendments”) and “Non-current Liabilities with Covenants” (referred to as the “2022 amendments”)

The 2020 amendments clarify that for a liability to be classified as non-current, the Group shall assess whether it has the right at the end of the reporting period to defer settlement of the liability for at least twelve months after the reporting period. If such rights are in existence at the end of the reporting period, the liability is classified as non-current regardless of whether the Group will exercise that right.

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The 2020 amendments also stipulate that, if the right to defer settlement is subject to compliance with specified conditions, the Group must comply with those conditions at the end of the reporting period even if the lender does not test compliance until a later date. The 2022 amendments further clarify that only covenants with which an entity is required to comply on or before the reporting date should affect the classification of a liability as current or non-current. Although the covenants to be complied with within twelve months after the reporting period do not affect the classification of a liability, the Group shall disclose information that enables users of financial statements to understand the risk of the Group that may have difficulty complying with the covenants and repay its liabilities within twelve months after the reporting period.

The 2020 amendments stipulate that, for the purpose of liability classification, the aforementioned settlement refers to a transfer of cash, other economic resources or the Group’s own equity instruments to the counterparty that results in the extinguishment of the liability. However, if the terms of a liability that could, at the option of the counterparty, result in its settlement by a transfer of the Group’s own equity instruments, and if such option is recognized separately as equity in accordance with IAS 32 “Financial Instruments: Presentation”, the aforementioned terms would not affect the classification of the liability.

• 3) Amendments to IAS 7 and IFRS 7 “Supplier Finance Arrangements”

Supplier finance arrangements are characterized by one or more finance providers offering to pay amounts an entity owes its suppliers and the entity agreeing to pay according to the terms and conditions of the arrangements at the same date as, or a date later than, the suppliers are paid. The amendments stipulate that the Group shall disclose the relevant information about its supplier finance arrangements that enables users of financial statements to assess the effects of those arrangements on the Group’s liabilities and cash flows and on the Group’s exposure to liquidity risk.

Except for the above impact, as of the date the consolidated financial statements were authorized for issue, the Group has assessed that the application of other standards and interpretations will not have a material impact on the Group’s financial position and financial performance.

• c. The IFRS Accounting Standards in issue but not yet endorsed and issued into effect by the FSC.

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

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

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

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• 1) Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture”

The amendments stipulate that, when the Group sells or contributes assets that constitute a business (as defined in IFRS 3) to an associate or joint venture, the gain or loss resulting from the transaction is recognized in full. Also, when the Group loses control of a subsidiary that contains a business but retains significant influence or joint control, the gain or loss resulting from the transaction is recognized in full.

Conversely, when the Group sells or contributes assets that do not constitute a business to an associate or joint venture, the gain or loss resulting from the transaction is recognized only to the extent of the Group’s interest as an unrelated investor in the associate or joint venture, i.e., the Group’s share of the gain or loss is eliminated. Also, when the Group loses control of a subsidiary that does not contain a business but retains significant influence or joint control over an associate or a joint venture, the gain or loss resulting from the transaction is recognized only to the extent of the Group’s interest as an unrelated investor in the associate or joint venture, i.e., the Group’s share of the gain or loss is eliminated.

• 2) Amendments to IAS 21 “Lack of Exchangeability”

The amendments stipulate that a currency is exchangeable into another currency when an entity is able to obtain the other currency within a time frame that allows for a normal administrative delay and through a market or exchange mechanism in which an exchange transaction would create enforceable rights and obligations. An entity shall estimate the spot exchange rate at a measurement date when a currency is not exchangeable into another currency to reflect the rate at which an orderly exchange transaction would take place at the measurement date between market participants under prevailing economic conditions. In this situation, the Group shall disclose information that enables users of its financial statements to understand how the currency not being exchangeable into the other currency affects, or is expected to affect, its financial performance, financial position and cash flows.

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

4. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION

• a. Statement of compliance

The consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, or other regulations and IFRS Accounting Standards as endorsed and issued into effect by the FSC.

• b. Basis of preparation

The consolidated financial statements have been prepared on the historical cost basis except for financial instruments which are measured at fair value.

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

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

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

• 3) Level 3 inputs are unobservable inputs for an asset or liability.

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

Current assets include:

• 1) Assets held primarily for the purpose of trading;

• 2) Assets expected to be realized within 12 months after the reporting period; and

• 3) Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.

Current liabilities include:

• 1) Liabilities held primarily for the purpose of trading;

• 2) Liabilities due to be settled within 12 months after the reporting period, even if an agreement to refinance, or to reschedule payments, on a long-term basis is completed after the reporting period and before the consolidated financial statements are authorized for issue; and

• 3) Liabilities for which the Group does not have an unconditional right to defer settlement for at least 12 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.

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

• d. Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and the entities controlled by the Company (i.e., its subsidiaries, including structured entities).

Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statement of profit or loss and other comprehensive income from the effective dates of acquisitions up to the effective dates of disposal, as appropriate.

When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Company.

All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the Group’s interests 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 the Company.

See Note 13 and Table 5 for detailed information on subsidiaries (including percentages of ownership and main businesses).

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e. Foreign currencies

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

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

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

Non-monetary items that are measured at historical cost in a foreign currency are not retranslated.

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

On the disposal of a foreign operation (i.e., a disposal of the Company’s entire interest in a foreign operation, or a disposal involving the loss of control over a subsidiary that includes a foreign operation, or a partial disposal of an interest in a joint arrangement or an associate that includes a foreign operation of which the retained interest becomes a financial asset), all of the exchange differences accumulated in equity in respect of that operation are reclassified to profit or loss.

In relation to a partial disposal of a subsidiary that does not result in the Company losing control over the subsidiary, the proportionate share of accumulated exchange differences is re-attributed to the non-controlling interests of the subsidiary but is not recognized in profit or loss. For all other partial disposals, the proportionate share of the accumulated exchange differences recognized in other comprehensive income is reclassified to profit or loss.

f. Inventories

 Inventories

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

• Properties for sale

Properties for sale is initially recorded at cost. The borrowing costs directly attributable to properties for sale are capitalized as part of the cost of the asset. When the property sales have been deemed as cost carried forward, cost is allocated by applying sales and building coverage ratios. Once selected, the same construction project cannot be changed in the preceding and following years.

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The properties for sale are measured at the lower of cost and net realizable value. The net realizable value is the estimated selling prices of inventories less all estimated costs of completion and estimated costs necessary to make the sale.

• g. Investments in associates

An associate is an entity over which the Group has a significant influence and is neither a subsidiary nor an interest in a joint venture.

The Group uses the equity method to account for its investments in associates and joint ventures.

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

Any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets and liabilities of an associate or a joint venture at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized. Any excess of the Group’s share of the net fair value of the identifiable assets and liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss.

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

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

The entire carrying amount of an investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized 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.

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The Group discontinues the use of the equity method from the date on which its investment ceases to be an associate and a joint venture. Any retained investment is measured at fair value at that date, and the fair value is regarded as the investment’s fair value on initial recognition as a financial asset. The difference between the previous carrying amount of the associate and the joint venture attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate and the joint venture. The Group accounts for all amounts previously recognized in other comprehensive income in relation to that associate and joint venture on the same basis as would be required if that associate had directly disposed of the related assets or liabilities. If an investment in an associate becomes an investment in a joint venture or an investment in a joint venture becomes an investment in an associate, the Group continues to apply the equity method and does not remeasure the retained interest.

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

• h. Property, plant and equipment

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

Properties in the course of construction for production, supply or administrative purposes are carried at cost, less any recognized impairment loss. Cost includes professional fees and borrowing costs eligible for capitalization. Such properties are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for intended use.

Freehold land is not depreciated.

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

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

• i. Investment properties

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

Freehold investment properties are initially measured at cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and accumulated impairment loss. Depreciation is recognized using the straight-line method.

For a transfer of classification from investment properties to property, plant and equipment, the deemed cost of the property for subsequent accounting is its carrying amount at the commencement of owner-occupation.

For a transfer of classification from property, plant and equipment to investment properties, the deemed cost of the property for subsequent accounting is its carrying amount at the end of owner-occupation.

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

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• j. Intangible assets

• 1) Intangible assets acquired separately

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

• 2) 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.

• k. Impairment of property, plant and equipment, right-of-use asset, investment properties, intangible assets (excluding goodwill)

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

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually.

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

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

• l. Financial instruments

Financial assets and financial liabilities are recognized when a group entity 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) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

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1) Financial assets

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

• a) Measurement categories

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

• i. Financial assets at FVTPL

Financial assets are classified as at FVTPL when such a financial asset is mandatorily classified 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, with any gains or losses arising on remeasurement recognized in profit or loss. The net gain or loss recognized in other gains and losses does not incorporate any dividends or interest earned on such a financial asset. Fair value is determined in the manner described in Note 29.

• ii. Financial assets at amortized cost

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

• i) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and

• ii) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, trade receivables at amortized cost and debt investments with no active market, are measured at amortized cost, which equals the gross carrying amount determined by the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

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

Cash equivalents include time deposits and repurchase agreement 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.

• iii. 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.

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

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

b) Impairment of financial assets

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

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

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

The impairment loss of all financial assets is recognized in profit or loss by a reduction in their carrying amounts through a loss allowance account, except for investments in debt instruments that are measured at FVTOCI, for which the loss allowance is recognized in other comprehensive income and the carrying amounts of such financial assets are not reduced.

c) Derecognition of financial assets

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

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

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On derecognition of a financial asset other than in its entirety, the Group allocates the previous carrying amount of the financial asset between the part it continues to recognize and the part it no longer recognizes on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognized and the sum of the consideration received for the part that is no longer recognized is treated in the same way as when the financial asset is derecognized in entirety. A cumulative gain or loss that had been recognized in other comprehensive income is allocated between the part that continues to be recognized and the part that is no longer recognized on the basis of the relative fair values of those parts.

2) Financial liabilities

• a) Subsequent measurement

Except the following situations, all financial liabilities are measured at amortized cost using the effective interest method.

• Financial liabilities at FVTPL

Except the financial liabilities at FVTPL, all financial liabilities are measured at amortized cost using the effective interest method.

Financial liabilities held for trading are stated at fair value, and any gains or losses on such financial liabilities are recognized in other gains or losses. Fair value is determined in the manner described in Note 29.

• b) Derecognition of financial liabilities

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

• 3) Convertible bonds

The component parts of compound instruments (i.e., convertible bonds) issued by the Group 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 using the prevailing market interest rate for similar non-convertible instruments. This amount is recorded as a liability on an amortized cost basis using the effective interest method until extinguished upon conversion or upon 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, net of income tax effects, 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 transferred to capital surplus - share premiums. When the conversion option remains unexercised at maturity, the balance recognized in equity will be transferred to capital surplus - share premiums.

Transaction costs that relate to the issuance of the convertible notes 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.

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4) Derivative financial instruments

The Group enters into a variety of derivative financial instruments to manage its exposure to interest rate and foreign exchange rate risks, including foreign exchange forward contracts, interest rate swaps.

Derivatives are initially recognized at fair value at the date on which 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 unless the derivative is designated and effective as a hedging instrument; in which event, the timing of the recognition in profit or loss depends on the nature of the hedging relationship. When the fair value of a derivative financial instrument is positive, the derivative is recognized as a financial asset; when the fair value of a derivative financial instrument is negative, the derivative is recognized as a financial liability.

Derivatives embedded in hybrid contracts that contain financial asset hosts that is 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 that is 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.

m. Revenue recognition

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

Revenue from the sale of goods

Revenue from the sale of goods comes from sales of crystals frequency control devices and sensors. Sales of crystals frequency control devices and sensors are recognized as revenue when the goods are delivered to the customer’s specific location, the goods are shipped and the goods are picked up by customers because it is the time when the customer has full discretion over the manner of distribution and price to sell the goods, has the primary responsibility for sales to future customers and bears the risks of obsolescence. Trade receivables are recognized concurrently.

n. Leasing

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

1) The Group as lessor

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

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. However, if the head lease is a short-term lease that the Group, as a lessee, has accounted for applying recognition exemption, the sublease is classified as an operating lease.

Under finance leases, the lease payments comprise fixed payments less any lease incentives payable. The net investment in a lease is measured at (a) the present value of the sum of the lease payments receivable by a lessor and any unguaranteed residual value accrued to the lessor plus (b) initial direct costs and is presented as a finance lease receivable. Finance lease income is allocated to the relevant accounting periods so as to reflect a constant, periodic rate of return on the Group’s net investment outstanding in respect of leases.

• 25 -

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

2) The Group as lessee

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

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

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

Lease liabilities are initially measured at the present value of the lease payments, which comprise fixed payments. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the Group uses the lessee’s incremental borrowing 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, the Group remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. Lease liabilities are presented on a separate line in the consolidated balance sheets.

o. Borrowing costs

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

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

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

p. 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.

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

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

• q. Employee benefits

1) Short-term employee benefits

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

2) Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered services entitling them to the contributions.

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

Net defined benefit liability (asset) represents the actual deficit (surplus) in the Group’s defined benefit plan. Any surplus resulting from this calculation is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.

r. Taxation

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

1) Current tax

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

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

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

• 27 -

2) Deferred tax

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

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

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

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

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

• 3) Current and deferred tax for the year

Current and deferred tax are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

5. MATERIAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

• 28 -

6. CASH AND CASH EQUIVALENTS

Cash on hand Checking accounts and demand deposits Cash equivalents (investments with original maturities of less than three months) Time deposits Repurchase agreements collateralized by bonds		December 31	December 31
		2023 $ 852 3,503,417 - 700,000 $ 4,204,269	2022 $ 1,179 3,367,422 274,009 580,000 $ 4,222,610

The market rate intervals of cash in bank at the end of the reporting period were as follows:

Demand deposits Time deposits Repurchase agreements collateralized by bonds	December 31
	2023 2022 0.001%-3.50% 0.001%-2.85% 1.25%-3.3% 0.98%-4.13% 1.16%-1.26% 1.02%

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

Financial assets at FVTPL-current Financial assets mandatorily classified as at FVTPL Derivative financial instruments (not under hedge accounting) Foreign exchange forward contracts and exchange contracts (b) Non-derivative financial assets Listed shares Mutual funds Hybrid financial assets Structured deposits (a) Financial liabilities at FVTPL-current Financial liabilities mandatorily classified as at FVTPL Derivative financial liabilities (not under hedge accounting) Foreign exchange forward contracts and exchange contracts (b)		December 31	December 31
		2023 $ 1,490 - 288 617,272 617,560 $ 619,050 $ 18,323	2022 $ 3,662 20,350 287 393,151 413,788 $ 417,450 $ 13,620

• a. The Group entered into structured time deposit contract with Bank during the years ended December 31, 2023 and 2022. The structured time deposit contract includes an embedded derivative instrument which is not closely related to the host contract. The entire contract was assessed and mandatorily classified as at FVTPL since it contained a host that is an asset within the scope of IFRS 9.

• 29 -

• b. At the end of the reporting period, outstanding foreign exchange contracts and exchange contracts not under hedge accounting were as follows:

			Contract Amount
	Currency	Maturity Date	(In Thousands)
December 31, 2023
Knock-out forward	USD/RMB	2024.01.09-2024.02.19	USD6,000/RMB43,440
Exchange contracts	USD/NTD	2024.02.20-2024.05.02	USD31,000/NTD961,812
Exchange contracts	JPY/NTD	2024.01.10-2024.02.20	JPY400,000/NTD86,540
Sell	USD/RMB	2024.01.29	USD2,500/RMB18,124
December 31, 2022
Sell	USD/RMB	2023.01.30-2023.04.26	USD10,000/RMB70,227
Sell	USD/JPY	2023.01.04-2023.01.10	USD2,500/JPY334,823
Exchange contracts	USD/NTD	2023.01.09-2023.03.29	USD29,000/NTD900,640
Foreign exchange forward	USD/NTD	2023.01.10	USD3,000/NTD99,000
contracts

The Group entered into foreign exchange forward contracts and exchange contracts during the years ended December 31, 2023 and 2022 to manage exposures due to exchange rate fluctuations of foreign currency denominated assets and liabilities. However, those contracts did not meet the criteria of hedge effectiveness and therefore were not accounted for using hedge accounting.

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Non-current Domestic investments Listed shares UPI Semiconductor Corp. Emerging market shares Win Win Precision Technology Co., Ltd. Unlisted shares Foreign investments Unlisted shares		December 31	December 31
		2023 $ - 72,844 68,056 140,900 234,857 $ 375,757	2022 $ 262,122 - 213,170 475,292 187,241 $ 662,533

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

On January 16, 2023, Win Win Precision Technology Co., Ltd.’s shares were listed on the emerging market of OTC. The transfer of fair value measurement level referred to Note 29.

• 30 -

In 2023 and 2022, the Group sold its shares in UPI Semiconductor Corp. in order to manage credit concentration risk. The shares sold had a fair value of $299,306 thousand and $178,498 thousand and its related unrealized gain of $227,810 thousand and $151,993 thousand was transferred from other equity to retained earnings.

In 2022, the Group disposed of QST Products LL’s common stock, the related unrealized loss on financial assets at fair value through other comprehensive income of $5,019 thousand was transferred to retained earnings as a reduction.

9. FINANCIAL ASSETS AT AMORTIZED COST

Current Domestic investments Pledge deposits (a) Time deposits with original maturity of more than three months (b) Non-current Domestic investment Time deposits with original maturity of more than one year (b)		December 31	December 31
		2023 $ 99,349 - $ 99,349 $ 199,107	2022 $ 70,259 281,718 $ 351,977 $ -

• a. Refer to Note 31 for information relating to investments in financial assets at amortized cost pledged as security.

• b. The ranges of interest rates for time deposits with original maturities of more than 3 months were approximately 2.9%-5.21% and 1.68%-4.125% per annum as of December 31, 2023 and 2022, respectively.

10. NOTES RECEIVABLE, TRADE RECEIVABLES AND OTHER RECEIVABLES

Notes receivable At amortized cost Gross carrying amount Less: Allowance for impairment loss Trade receivables At amortized cost Gross carrying amount Less: Allowance for impairment loss		December 31	December 31
		2023 $ 87,571 - $ 87,571 $ 3,181,222 (13,442) $ 3,167,780	2022 $ 32,131 (6) $ 32,125 $ 3,538,129 (13,497) $ 3,524,632

• 31 -

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

The Group measures the loss allowance for trade receivables at an amount equal to lifetime ECLs. The expected credit losses on trade receivables are estimated using a provision matrix prepared by reference to the past default experience of the customer, the customer’s current financial position, economic condition of the industry in which the customer operates, as well as the GDP forecasts and industry outlook. As the Group’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished according to the Group’s different customer base. The Group recognizes 100% loss allowance for trade receivables of greater than 120 days past due and unsecured.

The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery. For 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.

The following table details the loss allowance of notes receivable and trade receivables based on the Group’s provision matrix:

December 31, 2023

Expected credit loss rate Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost December 31, 2022 Expected credit loss rate Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost	Not Past Due 1 to 60 Days 61 to 120 Days 121 to 180 Days Over 180 Days 0.43% 0.003%-0.27% 0.62%-0.92% 100% 100% $ 3,110,079 $ 158,631 $ 83 $ - $ - (13,436) (5) (1) - - $ 3,096,643 $ 158,626 $ 82 $ - $ - Not Past Due 1 to 60 Days 61 to 120 Days 121 to 180 Days Over 180 Days 0.30% 0.27%-2.84% 22.93%-34.39% 100% 100% $ 3,332,503 $ 230,679 $ 7,078 $ - $ - (10,032) (1,037) (2,434) - - $ 3,322,471 $ 229,642 $ 4,644 $ - $ -	Total $ 3,268,793 (13,442) $ 3,255,351 Total $ 3,570,260 (13,503) $ 3,556,757

The movements of the loss allowance of trade receivables were as follows:

Balance at January 1 Less: Impairment losses reversed Foreign exchange gains and losses Balance at December 31	2023 $ 13,503 (6) (55) $ 13,442	2022 $ 13,494 (39) 48 $ 13,503

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11. FINANCE LEASE RECEIVABLES

Undiscounted lease payments Year 1 Year 2 Year 3 Year 4 Year 5 Year 5 onwards Less: Unearned finance income Net investment in leases presented as finance lease receivable		December	31
		2023 $ 4,391 4,611 2,366 - - - 11,368 (575) $ 10,793	2022 $ - - - - - - - - $ -

12. INVENTORIES

Finished goods Work in process Raw materials Supplies and spare parts Merchandise Buildings and land held for sale		**December 31 **	**December 31 **
		2023 $ 438,293 525,589 643,939 145,700 482,495 233,977 $ 2,469,993	2022 $ 620,212 446,386 769,022 137,716 475,972 250,413 $ 2,699,721

The cost of crystal inventories recognized as cost of goods sold for 2023 and 2022 included $6,977,345 thousand and $8,066,061 thousand, respectively. The cost of goods sold for 2023 and 2022 included inventory write-downs of $13,277 thousand and $18,949 thousand, respectively.

The cost of real estate inventories recognized as cost of goods sold for 2023 and 2022 included $13,050 thousand and $72,789 thousand, respectively.

The construction in progress is the payment made by Chongqing Zhongyang Properties Co., Ltd. to acquire the land use right in Chongqing Gao-Shing District to develop and sell real estate in 2012. Chongqing Zhongyang Properties Co., Ltd. has acquired real estate certificate issued by Chongqing Association of land and real estate resources during 2013. The construction began in 2018 and continued to recognize revenue was recognized after completion in April 2021.

The details of the building and land held for sale are as follows:

Area Jing Yuan	December 31, 2023
	Buildings and Land Held for Sale Contract Liabilities - Current $ 233,977 $ 40

• 33 -

Area Jing Yuan

**December **	31, 2022
Buildings and	Contract
Land Held for	Liabilities -
Sale	Current
$ 250,413	$ 40

13. SUBSIDIARIES

Subsidiaries Included in the Consolidated Financial Statements

The detail information of the subsidiaries at the end of reporting period was as follows:

Investor Investee Nature of Activities TXC Corporation (TXC) Taiwan Crystal Technology International Limited (TCTI) Investment management TXC Technology, Inc. Marketing activities TXC Japan Corporation Marketing activities Taiwan Crystal Technology (HK) Limited (TCT-HK) International trading TXC Europe GmbH Marketing activities Taiwan Crystal Technology International Limited TXC (Ningbo) Corporation (TXC-Ningbo) Research and development, manufacture, and sale of quartz elements and related electronic products TXC (Ningbo) Corporation TXC (Chongqing) Corporation (TXC-Chongqing) Research and development, manufacture, and sale of quartz elements and related electronic products Chongqing Zhongyang Properties Co., Ltd. (Chongqing Zhongyang) Properties development Ningbo Beilun Jingyu Trading Corporation (Beilun Jingyu) International trading Ningbo Meishan Free Trade Port Area Ding Kai Investment Management Company Limited (Ding Kai Investment) Investment management TETC CORP. NINGBO (TETC-NINGBO) Research and development, manufacture, and sale of quartz elements and related electronic products PT TXC TECHNOLOGY INDONESIA (tentative name) Research and development, manufacture, and sale of quartz elements and related electronic products Chongqing Zhongyang Properties Co., Ltd. ChongQing Dingsen Commercial Management Co., Ltd Property management TETC CORP. NINGBO Shanghai JCH Co., Ltd (JCH) Marketing activities and technical services

Proportion of Ownership December 31 2023 2022 Remark 100 100 a 100 100 b 100 100 c 100 100 e 100 100 j 100 100 d 100 100 f 100 100 g 100 100 h 100 100 i 100 100 l - - n 100 100 k 100 100 m

• a. Taiwan Crystal Technology International Limited was incorporated on December 23, 1998 in Samoa.

• b. TXC Technology, Inc. was incorporated on December 1, 2000 in California, U.S.A.

• c. TXC Japan Corporation was incorporated on September 13, 2005 in Yokohama, Japan.

• d. TXC (Ningbo) Corporation was incorporated on March 12, 1999 in Ningbo, China.

• e. Taiwan Crystal Technology (HK) Limited was incorporated on July 6, 2010 in Hong Kong Special Administrative Region, China.

• 34 -

• f. TXC (Chongqing) Corporation was incorporated on October 11, 2010 in Chongqing, China.

• g. Chongqing Zhongyang Properties Co., Ltd. was incorporated on February 14, 2011 in Chongqing, China.

• h. Ningbo Beilun Jingyu Trading Corporation was incorporated on September 7, 2011 in Ningbo, China.

• i. Ningbo Meishan Free Trade Port Area Ding Kai Investment Management Company Limited was incorporated on May 12, 2017 in Beilun District, Ningbo, China.

• j. TXC Europe GmbH was founded in Germany on August 17, 2018.

• k. ChongQing Dingsen Commercial Management Co., Ltd. was incorporated on February 21, 2019 in Chongqing, China.

• l. TETC CORP. NINGBO was incorporated on December 30, 2020 in Ningbo, China.

• m. Shanghai JCH Co., Ltd. was registered on October 13, 2022 in Shanghai, China.

• n. The Group has approved to invest in PT TXC TECHNOLOGY INDONESIA (tentative name) on December 18, 2023. The proportion of ownership was 80%; as of December 31, 2023, it has not yet completed the capital injection.

14. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Investments in associates and join venture a. Investment in associates Associates that are not individually material The Group’s share of: Profit from continuing operations Other comprehensive (loss) income Total comprehensive income for the year		**December 31 **	**December 31 **
		2023 2022 $ 446,126 $ 458,607 **December 31 **
	2023 $ 397,952 For the Year Ended		2022 $ 401,707 December 31
		2023 $ 20,756 (4,266) $ 16,490	2022 $ 24,867 3,230 $ 28,097

Refer to Table 4 “name, locations, and related information of investees on which the Company exercises significant influence” for the nature of activities, principal place of business and country of incorporation of the associates.

• 35 -

b. Investment joint venture

Joint ventures that are not individually material The Group’s share of: Profit from continuing operations Total comprehensive income for the year		December	31
	2023 2022 $ 48,174 $ 56,900 For the Year Ended December 31
		2023 $ (16,184) $ (16,184)	2022 $ (7,742) $ (7,742)

Refer to Table 4 “name, locations, and related information of investees on which the Company exercises significant influence” and Table 5 “information on investment in mainland China” for the nature of activities, principal place of business and country of incorporation of the joint venture.

15. PROPERTY, PLANT AND EQUIPMENT

Cost Balance at January 1, 2022 Additions Disposals Transfer from investment properties Transfer from prepayment for equipment Effect of foreign currency exchange differences Balance at December 31, 2022 Accumulated depreciation and impairment Balance at January 1, 2022 Disposals Depreciation expenses Impairment losses Transfer from investment properties Effect of foreign currency exchange differences Balance at December 31, 2022 Carrying value at December 31, 2022 Cost Balance at January 1, 2023 Additions Disposals Reclassified as an intangible assets Reclassified Effect of foreign currency exchange differences Balance at December 31, 2023 Accumulated depreciation and impairment Balance at January 1, 2023 Disposals Depreciation expenses Impairment losses Reclassified Effect of foreign currency exchange differences Balance at December 31, 2023 Carrying value at December 31, 2022 and January 1, 2023 Carrying value at December 31, 2023	Freehold Land $ 621,855 - - - - - $ 621,855 $ - - - - - - $ - $ 621,855 $ 621,855 - - - - - $ 621,855 $ - - - - - - $ - $ 621,855 $ 621,855	Land Improvements $ 2,279 745 - - - - $ 3,024 $ 1,209 - 372 - - - $ 1,581 $ 1,443 $ 3,024 - - - - - $ 3,024 $ 1,581 - 317 - - - $ 1,898 $ 1,443 $ 1,126	Buildings $ 2,728,943 48,796 (17,836 ) 5,930 - 16,158 $ 2,781,991 $ 1,211,106 (17,836 ) 149,840 - 3,668 6,929 $ 1,353,707 $ 1,428,284 $ 2,781,991 50,525 (2,033 ) - 88,305 (20,052) $ 2,898,736 $ 1,353,707 (2,033 ) 135,230 - - (10,553) $ 1,476,351 $ 1,428,284 $ 1,422,385	Machinery and Equipment $ 9,699,052 1,053,663 (95,597 ) - 393,996 76,204 $ 11,127,318 $ 6,157,842 (90,446 ) 999,813 1,749 - 42,922 $ 7,111,880 $ 4,015,438 $ 11,127,318 336,164 (243,154 ) - (4,071 ) (79,064) $ 11,137,193 $ 7,111,880 (206,250 ) 975,057 3,234 (80 ) (66,387) $ 7,817,454 $ 4,015,438 $ 3,319,739	Transportation Equipment O $ 21,149 4,063 (1,116 ) - - 258 $ 24,354 $ 15,109 (597 ) 2,442 - - 183 $ 17,137 $ 7,217 $ 24,354 866 (800 ) - - (361) $ 24,059 $ 17,137 (800 ) 2,806 - - (282) $ 18,861 $ 7,217 $ 5,198	ffice Equipment $ 387,266 50,457 (14,292 ) - - 3,900 $ 427,331 $ 244,587 (13,885 ) 46,031 - - 2,673 $ 279,406 $ 147,925 $ 427,331 41,701 (7,535 ) - 1,062 (29,191) $ 433,368 $ 279,406 (7,040 ) 47,494 - 80 (3,404) $ 316,536 $ 147,925 $ 116,832	Property under Construction $ 13,137 84,687 - - - (244) $ 97,580 $ - - - - - - $ - $ 97,580 $ 97,580 280,360 (460 ) (1,845 ) (88,496 ) (3,943) $ 283,196 $ - - - - - - $ - $ 97,580 $ 283,196	Total $ 13,473,681 1,242,411 (128,841 ) 5,930 393,996 96,276 $ 15,083,453 $ 7,629,853 (122,764 ) 1,198,498 1,749 3,668 52,707 $ 8,763,711 $ 6,319,742 $ 15,083,453 709,616 (253,982 ) (1,845 ) (3,200 ) (132,611) $ 15,401,431 $ 8,763,711 (216,123 ) 1,160,904 3,234 - (80,626) $ 9,631,100 $ 6,319,742 $ 5,770,331

• 36 -

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

Land improvements 5-7 years Buildings Industrial building 3-51 years Electrical power systems 3-51 years Engineering systems 3-51 years Equipment Major production equipments 3-15 years Temperature control systems 4-7 years Transportation equipments 4-7 years Transportation equipments 4-5 years Office equipment 3-5 years

Property, plant and equipment pledged as collateral for bank borrowings is set out in Note 31.

16. LEASE ARRANGEMENTS

• a. Right-of-use assets

Carrying amounts Land use right Buildings Transportation equipment Additions to right-of-use assets Depreciation charge for right-of-use assets Land use right Buildings Transportation equipment Income from the subleasing of right-of-use assets (presented in other income)		December 31	December 31
	2023 $ 191,831 1,850 2,559 $ 196,240 **For the Year Ended **		2022 $ 199,547 5,727 710 $ 205,984 **December 31 **
		2023 $ 32,485 $ 4,615 22,039 619 $ 27,273 $ (1,089)	2022 $ - $ 4,654 2,618 448 $ 7,720 $ -

Right-of-use assets pledged as collateral for bank borrowings are set out in Note 31.

• 37 -

b. Lease liabilities

Carrying amounts Current Non-current		December	31
		2023 $ 5,958 6,714 $ 12,672	2022 $ 3,088 3,399 $ 6,487

Range of discount rates for lease liabilities was as follows:

Buildings Transportation equipment	December 31
	2023 2022 1.27%-3.85% 0.86%-1.27% 3% 0.86%

• c. Material lease-in activities and terms

The Group purchased the land use right for the construction of plants, offices and retail stores with use term of 50 years in mainland China and its payments was paid fully at the time of contract signed and can be renewed upon the expiration of the period. The Group does not have purchase options to acquire the land and buildings at the end of the contract.

d. Other lease information

Expenses relating to short-term leases Total cash outflow for leases	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 249 $ (26,401)	2022 $ 207 $ (3,258)

The Group leases certain buildings, which qualify as short-term leases. The Group has elected to apply the recognition exemption and thus did not recognize right-of-use assets and lease liabilities for these leases.

17. INVESTMENT PROPERTIES

	Completed
	Investment
	Properties
Cost
Balance at January 1, 2022	$ 544,232
Disposals	(300)
Transfer from inventories	92,595
Transfer to property, plant and equipment	(5,930)
Effect of foreign currency exchange differences	6,733
Balance at December 31, 2022	$ 637,330
	(Continued)

• 38 -

	Completed
	Investment
	Properties
Accumulated depreciation and impairment
Balance at January 1, 2022	$ (49,864)
Disposals	300
Transfer to property, plant and equipment	3,668
Depreciation expenses	(19,592)
Effect of foreign currency exchange differences	(496)
Balance at December 31, 2022	$ (65,984)
Carrying amounts at December 31, 2022	$ 571,346
Cost
Balance at January 1, 2023	$ 637,330
Transfer to inventories	(418)
Effect of foreign currency exchange differences	(9,632)
Balance at December 31, 2023	$ 627,280
Accumulated depreciation and impairment
Balance at January 1, 2023	$ (65,984)
Depreciation expenses	(22,204)
Effect of foreign currency exchange differences	1,150
Balance at December 31, 2023	$ (87,038)
Carrying amounts at December 31, 2023	$ 540,242
	(Concluded)

The investment real estate held by the combined company is mainly located in Pingzhen District of Taoyuan City and Ningbo City, Mainland China, and some of the factories and offices are leased to collect rents. The other part of the investment real estate is located in Chongqing City, mainland China, and is mainly self-built shopping malls to collect rents.

The investment properties held by the Group are depreciated using the straight-line method over their useful lives of 3-60 years.

The fair value of the Group’s investment properties as of December 31, 2023 and 2022 was $1,077,690 thousand and $1,085,198 thousand, respectively. The determination of fair value was not performed by independent qualified professional valuers; however, the management of the Group used the valuation model that market participants would use in determining the fair value. The valuation was arrived at by reference to market evidence of transaction prices for similar properties.

All of the Group’s investment properties were freehold properties. The investment properties pledged as collateral for bank borrowing are set out in Note 31.

• 39 -

18. BORROWINGS

a. Short-term borrowings

Secured borrowings (Note 31) Bank loans Unsecured borrowings Bank loans Letters of credit Short-term borrowings		**December 31 **	**December 31 **
		2023 $ - 190,500 51,118 241,618 $ 241,618	2022 $ 43,651 359,869 110,230 470,099 $ 513,750

The interest rates on the bank loans and letters of credit were 2.83%-3.5% and 1.2%-3.65% per annum as of December 31, 2023 and 2022, respectively.

• b. Long-term borrowings

Secured borrowings (Note 31) Bank loans Less: Current portions Unsecured borrowings Bank loans Less: Current portions Long-term borrowings		December 31	December 31
		2023 $ 216,966 (43,394) 173,572 2,347,591 (638,398) 1,709,193 $ 1,882,765	2022 $ 39,180 - 39,180 2,374,205 (890,785) 1,483,420 $ 1,522,600

The borrowings of the Group were as follows:

Detail of Borrowing Unsecured bank borrowing denominated in NT$ Maturity date: 2025.01.03 Principle is paid monthly since January 15, 2021 Unsecured bank borrowing denominated in NT$ Maturity date: 2025.01.03 Principle is paid monthly since January 15, 2021 Unsecured bank borrowing denominated in NT$ Maturity date: 2025.01.03 Principle is paid monthly since January 15, 2021	December 31
	2023 2022 $ 25,000 $ 50,000 37,500 75,000 37,500 75,000 (Continued)

• 40 -

Detail of Borrowing Unsecured bank borrowing denominated in NT$ Maturity date: 2025.04.01 Principle is paid monthly since March 15, 2023 Unsecured bank borrowing denominated in NT$ Maturity date: 2025.04.15 Principle is paid monthly since May 15, 2023 Unsecured bank borrowing denominated in NT$ Maturity date: 2024.09.15 Principle is paid monthly since September 15, 2022 Unsecured bank borrowing denominated in US$ Maturity date: 2024.09.15 Principle is paid monthly since September 15, 2022 Unsecured bank borrowing denominated in US$ Maturity date: 2024.09.15 Principle is paid monthly since September 15, 2022 Unsecured bank borrowing denominated in NT$ Maturity date: 2025.01.03 Principle is paid monthly since March 15, 2021 Unsecured bank borrowing denominated in NT$ Maturity date: 2025.07.04 Principle is repaid at maturity Unsecured bank borrowing denominated in NT$ Maturity date: 2025.07.04 Principle is repaid at maturity Unsecured bank borrowing denominated in NT$ Maturity date: 2026.08.17 Principle is paid monthly since September 15, 2022 Unsecured bank borrowing denominated in NT$ Maturity date: 2024.08.03 Principle is repaid at maturity Unsecured bank borrowing denominated in NT$ Maturity date: 2024.08.03 Principle is repaid at maturity Unsecured bank borrowing denominated in NT$ Maturity date: 2024.08.03 Principle is repaid at maturity Unsecured bank borrowing denominated in NT$ Maturity date: 2025.08.03 Principle is repaid at maturity Unsecured bank borrowing denominated in NT$ Maturity date: 2025.08.03 Principle is repaid at maturity Unsecured bank borrowing denominated in NT$ Maturity date: 2025.07.04 Principle is repaid at maturity Unsecured bank borrowing denominated in NT$ Maturity date: 2025.07.10 Principle is repaid at maturity Secured bank borrowing denominated in RMB Maturity date: 2027.11.01 Principle is repaid semi-annually per agreement of RMB2,500 thousand, from April 19, 2024 to April 19, 2026; per agreement of RMB5,000 thousand, from April 19, 2026 to the maturity date

**December 31 **

2023 2022 $ 180,000 $ 300,000 133,333 200,000 72,000 168,000 108,000 252,000 36,000 84,000 26,087 52,174 100,000 - 200,000 - 133,333 183,333 - 100,000 - 300,000 - 300,000 300,000 - 300,000 - 300,000 - 300,000 - 121,556 39,180

(Continued)

• 41 -

Detail of Borrowing Secured bank borrowing denominated in RMB Maturity date: 2027.10.19 Principle is repaid semi-annually per agreement of RMB2,500 thousand, from April 19, 2024 to April 19, 2026; per agreement of RMB5,000 thousand, from April 19, 2026 to the maturity date Unsecured bank borrowing denominated in RMB Maturity date: 2023.08.31 Principle is repaid semi-annually per agreement of RMB100 thousand, from November 30, 2022 to the maturity date. Unsecured bank borrowing denominated in RMB Maturity date: 2023.09.08 Principle is repaid semi-annually per agreement of RMB100 thousand, from December 8, 2022 to the maturity date. Unsecured bank borrowing denominated in RMB Maturity date: 2023.11.01 Principle is repaid semi-annually per agreement of RMB500 thousand, from February 1, 2023 to the maturity date. Unsecured bank borrowing denominated in RMB Maturity date: 2023.11.08 Principle is repaid semi-annually per agreement of RMB500 thousand, from February 8, 2023 to the maturity date. Unsecured bank borrowing denominated in US$ Maturity date: 2025.09.24 Principle is repaid at maturity Unsecured bank borrowing denominated in RMB Maturity date: 2025.04.02 Principle is repaid semi-annually per agreement of RMB266 thousand, from October 3, 2023 to the maturity date. Less: Current portions		**December 31 **	**December 31 **
		2023 $ 95,409 - - - - 36,882 21,957 (681,792) $ 1,882,765	2022 $ - 43,210 43,210 43,651 43,210 61,417 - (890,785) $ 1,522,600 (Concluded)

The range of interest rate on the bank loans was 0.85%-6.47% and 0.725%-5.49% per annum as of December 31, 2023 and 2022, respectively.

• 42 -

19. BONDS PAYABLE

Unsecured domestic convertible bonds Less: Discount on bonds payable Less: Corporate bonds due within one year or one operating cycle Unsecured domestic convertible bonds		December 31	December 31
		2023 $ 1,199,900 (6,080) 1,193,820 (1,193,820) $ -	2022 $ 1,200,000 (16,727) 1,183,273 - $ 1,183,273

On July 26, 2021, the Company issued the 5th domestic unsecured convertible bonds with an aggregate principal amount of $1,200,000 thousand at 0% interest rate, and the issuance period is for three years from July 26, 2021 to July 26, 2024. The repayment will be made at face value in full by cash upon maturity. Bondholders are entitled to convert bonds into the Company’s ordinary shares from October 27, 2021 to July 26, 2024. The conversion price was set initially at $138 per share. According to the terms on this convertible bonds, the conversion price should be adjusted to $113.6 per share starting from ex-dividend date of July 10, 2023.

The convertible bonds contain both liability and equity components. The equity component was presented in equity under the heading of capital surplus. The effective interest rate of the liability component was 0.8961% per annum on initial recognition.

Proceeds from issuance (less transaction costs of $5,427 thousand) Equity component (less transaction costs allocated to the equity component of $129 thousand) Assets component Liability component at the date of issue (less transaction costs allocated to the liability component of $5,298 thousand) Liability component at December 31, 2021 Interest charged at an effective interest rate Liability component at December 31, 2022 Interest charged at an effective interest rate Convertible bonds converted into ordinary shares Liability component at December 31, 2023 Less: Corporate bonds due within one year or one operating cycle Unsecured domestic convertible bonds

$ 1,194,573 (28,431) 2,040 $ 1,168,182 $ 1,172,721 10,552 1,183,273 10,647 (100) 1,193,820 (1,193,820) $ -

20. OTHER LIABILITIES

Current Other payables Payables for bonuses to employees and directors Payables for commissions Payables for salaries	**December 31 **
	2023 2022 $ 276,024 $ 393,658 17,840 25,232 151,979 147,661 (Continued)

• 43 -

Payables for bonuses Payables for annual leave Payables for purchases of equipment Others Deferred revenue Arising from government grants (Note 27) Non-current Deferred revenue Arising from government grants (Note 27)		**December 31 **	**December 31 **
		2023 $ 435,278 43,692 51,080 125,701 $ 1,101,594 $ 39,565 $ 79,319	2022 $ 506,933 47,364 138,135 162,996 $ 1,421,979 $ 38,817 $ 108,191

(Concluded)

21. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

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

The employees of the Group’s subsidiaries in mainland China are members of a state-managed retirement benefit plan operated by the government of China. The subsidiaries are required to contribute a specified percentage of payroll costs to the retirement benefit scheme to fund the benefits. The only obligation of the Group with respect to the retirement benefit plan is to make the specified contributions.

b. Defined benefit plans

The defined benefit plan adopted by the Company of the Group in accordance with the Labor Standards Act is operated by the government. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the 6 months before retirement. The Company contribute amounts equal to 9% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the 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 is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the Group has no right to influence the investment policy and strategy.

• 44 -

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

Present value of defined benefit obligation Fair value of plan assets Net defined benefit liability		December 31	December 31
		2023 $ 176,155 (156,050) $ 20,105	2022 $ 182,628 (147,425) $ 35,203

Movements in net defined benefit liability (asset) were as follows:

	Present Value	Present Value
	of the Defined				Net Defined
		Benefit	Fair Value of			Benefit
	Obligation		the Plan Assets		Liability (Asset)
Balance at January 1, 2022	$	192,025	$ (130,236)		$	61,789
Service cost
Current service cost		1,340		-		1,340
Past service cost loss (gain) on settlement		(458)		460		2
Net interest expense (income)		1,200		(857)		343
Recognized in profit or loss		2,082		(397)		1,685
Remeasurement
Return on plan assets (excluding amounts
included in net interest)		-		(9,662)		(9,662)
Actuarial (gain) loss - changes in
demographic assumptions		1,120		-		1,120
Actuarial (gain) loss - changes in financial
assumptions		(7,329)		-		(7,329)
Actuarial (gain) loss - experience
adjustments		1,358		-		1,358
Recognized in other comprehensive income		(4,851)		(9,662)		(14,513)
Contributions from the employer		-		(13,758)		(13,758)
Benefits paid		(6,628)		6,628		-
Balance at December 31, 2022	$	182,628	$ (147,425)		$	35,203
Service cost
Current service cost	$	945	$	-	$	945
Past service cost		465		-		465
Past service cost loss (gain) on settlement		(340)		326		(14)
Net interest expense (income)		2,739		(2,313)		426
Recognized in profit or loss		3,809		(1,987)		1,822
Remeasurement
Return on plan assets (excluding amounts
included in net interest)		-		(795)		(795)
Actuarial (gain) loss - changes in financial
assumptions		4,099		-		4,099
Actuarial (gain) loss - experience
adjustments		(7,091)		-		(7,091)
Recognized in other comprehensive income		(2,992)		(795)		(3,787)
						(Continued)

• 45 -

	Present Value
	of the Defined		Net Defined
	Benefit	Fair Value of		Benefit
	Obligation	the Plan Assets	Liability (Asset)
Contributions from the employer	$ -	$ (13,133)	$	(13,133)
Benefits paid	(7,290)	7,290		-
Balance at December 31, 2023	$ 176,155	$ (156,050)	$	20,105
				(Concluded)

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

Cost of goods sold Selling and marketing expenses General and administrative expenses Research and development expenses	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 960 135 272 455 $ 1,822	2022 $ 880 122 243 440 $ 1,685

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

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

• 2) Interest risk: A decrease in the (government/corporate) 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 valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations were as follows:

Discount rate(s) Expected rate(s) of salary increase	**December 31 **
	2023 2022 1.25% 1.50% 2.50% 2.50%

• 46 -

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

Discount rate(s) 0.25% increase 0.25% decrease Expected rate(s) of salary increase 0.25% increase 0.25% decrease		**December **	**31 **
		2023 $ (4,090) $ 4,237 $ 4,110 $ (3,989)	2022 $ (4,510) $ 4,679 $ 4,551 $ (4,409)

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 plan for the next year The average duration of the defined benefit obligation		**December **	**31 **
		2023 $ 13,440 9.8 years	2022 $ 13,560 10.2 years

22. EQUITY

• a. Share capital

Ordinary shares

Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued Bond conversion entitlement certificates Number of shares converted but registration change has not been completed (in thousands) Shares converted but registration change has not been completed (in thousands)		**December 31 **	**December 31 **	**December 31 **
		2023 2022 500,000 500,000 $ 5,000,000 $ 5,000,000 309,758 309,757 $ 3,097,570 $ 3,097,570 **December 31 **
			2023 1 $ 9	2022 - $ -

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

The Company’s 30,000 thousand shares authorized were reserved for the issuance of convertible bonds and employee share options.

• 47 -

b. Capital surplus

May be used to offset a deficit, distributed as cash dividends, or transferred to share capital* Issuance of ordinary shares Conversion of bonds Overdue options The difference between consideration received or paid and the carrying amount of the subsidiaries’ net assets during actual disposal or acquisition May only be used to offset a deficit Share of changes in capital surplus of associates or joint venture Other May not be used for any purpose Employee share options		December 31	December 31
		2023 $ 611,869 977,028 73,377 331 23,981 3,678 28,429 $ 1,718,693	2022 $ 611,776 977,028 73,377 331 15,627 3,409 28,431 $ 1,709,979

• Such capital surplus may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Company’s capital surplus and once a year).

c. Retained earnings and dividend policy

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

Dividends are recommended by the board of directors in accordance with the Corporation’s dividend policy. Under this policy, industry trends and growth should be evaluated, investment opportunities should be fully understood, and proper capital adequacy ratios should be considered in determining the dividends to be distributed. In addition, cash dividends should not be less than 20% of the total dividends to be appropriated.

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

• 48 -

When distributing the surplus, the Company is required to set aside additional special reserve equivalent to the net debit balance of the other equity interests in accordance with legal provisions (e.g., exchange differences on the translation of financial statements of foreign operating institutions, accumulated balances of unrealized gains and losses on financial assets at fair value through other comprehensive income). If there is a subsequent decrease in the amount of deductions from other equity items, the decrease can be transferred back to unappropriated earnings from the special surplus reserve.

The appropriations of earnings for 2022 and 2021 were approved by the shareholders in their meetings on May 30, 2023 and May 31, 2022, respectively. The appropriations and dividends per share were as follows:

Legal reserve Recognition (reversal) of special reserve Cash dividends	Appropriation of Earnings For Fiscal For Fiscal Year 2022 Year 2021 $ 296,435 $ 310,870 143,071 (346,761) 2,168,299 2,323,178	Dividends Per Share (NT$)
		For Fiscal For Fiscal Year 2022 Year 2021 $ - $ - - - 7.0 7.5

The appropriations of earnings for 2023, which were proposed by the board of directors on March 11, 2024 were as follows:

	Appropriation	Appropriation	Dividends Per	Dividends Per
	of	Earnings	Share	(NT$)
Legal reserve	$	194,468	$	-
Special reserve		384,696		-
Cash dividends		1,393,911		4.5

The appropriation of earnings for 2023 is subject to resolution by the shareholders in their meeting to be held on May 28, 2024.

• d. Others equity items

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

Balance at January 1 Exchange differences on translating the financial statements of foreign operations Share of exchange differences from associates accounted for using the equity method Balance at December 31	For the Year Ended	For the Year Ended	December 31
		2023 $ (450,523) (127,850) (4,333) $ (582,706)	2022 $ (559,579) 106,056 3,000 $ (450,523)

• 49 -

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

Balance at January 1 Recognized during the period Unrealized loss - equity instruments Share from associates accounted for using the equity method Other comprehensive loss recognized in the period Cumulative unrealized loss of equity instruments transferred to retained earnings due to disposal Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 307,453 (24,632) (72) (24,704) (227,810) $ 54,939	2022 $ 1,357,362 (902,903) (32) (902,935) (146,974) $ 307,453

23. REVENUE

Revenue from contracts with customers Revenue from sale of goods Construction contract revenue Contract Balances Trade receivables (Note 10) Contract liabilities Construction of properties Sale of goods	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2023 2022 $ 10,827,498 $ 13,104,001 22,904 65,687 $ 10,850,402 $ 13,169,688 **For the Year Ended December 31 **
		2023 $ 3,167,780 $ 40 31,550 $ 31,590	2022 $ 3,524,632 $ 40 12,116 $ 12,156

The contract liabilities were unearned sales revenue and accounted for other current liabilities.

• 50 -

24. NET PROFIT FROM CONTINUING OPERATIONS

Net profit from continuing operations was attributable to:

a. Interest income

Bank deposits Financial assets at amortized cost Others b. Other income Income from government grants Dividends Others c. Other gains and losses Loss on disposal of non-current assets held for sale Gain on disposal of property, plant and equipment Fair value changes of financial assets and financial liabilities Financial assets mandatorily at FVTPL Net foreign exchange gains Property, plant and equipment impairment losses Depreciation of investment properties Gain on modifications of lease Others	**For the Year Ended **	**For the Year Ended **	**December 31 **
	2023 $ 55,738 8,931 12,535 $ 77,204 For the Year Ended		2022 $ 13,398 10,516 3,521 $ 27,435 December 31
	2023 $ 120,671 12,561 29,797 $ 163,029 For the Year Ended		2022 $ 124,887 11,486 37,389 $ 173,762 December 31
		2023 $ - 1,527 1,729 68,611 (3,234) (22,204) 7 (39,398) $ 7,038	2022 $ (249) 7,560 3,869 436,249 (1,749) (19,592) - (33,431) $ 392,657

d. Finance costs

Interest on bank loans Interest on convertible bonds Interest on lease liabilities	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 46,325 10,647 647 $ 57,619	2022 $ 38,222 10,552 73 $ 48,847

• 51 -

e. Depreciation and amortization

Property, plant and equipment Investment properties Right-of-use assets Intangible assets An analysis of deprecation by function Operating costs Operating expenses Other gains and losses An analysis of amortization by function Operating costs Operating expenses Employee benefits expense Post-employment benefits (Note 21) Defined contribution plans Defined benefit plans Other employee benefits Payroll expense Labor and health insurance Others An analysis of employee benefits expense by function Operating costs Operating expenses	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2023 2022 $ 1,160,904 $ 1,198,498 22,204 19,592 27,273 7,720 17,790 22,825 $ 1,228,171 $ 1,248,635 $ 893,687 $ 924,733 294,490 281,485 22,204 19,592 $ 1,210,381 $ 1,225,810 $ 141 $ 120 17,649 22,705 $ 17,790 $ 22,825 For the Year Ended December 31
		2023 $ 116,912 1,822 118,734 2,256,542 140,040 94,760 2,491,342 $ 2,610,076 $ 1,516,960 1,093,116 $ 2,610,076	2022 $ 117,200 1,685 118,885 2,552,911 145,149 59,806 2,757,866 $ 2,876,751 $ 1,650,335 1,226,416 $ 2,876,751

f. Employee benefits expense

• 52 -

• g. Employees’ compensation and remuneration of directors for 2023 and 2022

The Company accrued employees’ compensation and remuneration of directors at the rates no less than 3% and no higher than 2%, respectively, of net profit before income tax, employees’ compensation, and remuneration of directors. The employees’ compensation and remuneration of directors for the years ended December 31, 2023 and 2022 which were approved by the Company’s board of directors on March 11, 2024 and March 6, 2023, respectively, were as follows:

Accrual rate

Employees’ compensation Remuneration of directors	For the Year Ended December 31
	2023 2022 9.0% 9.0% 1.5% 1.5%

Amount

Employees’ compensation Remuneration of directors	**For the Year Ended December 31 **	**For the Year Ended December 31 **
	2023 Cash Share $ 194,831 $ - 32,472 -	2022
		Cash Share $ 330,344 $ - 55,057 -

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

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

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

25. INCOME TAXES RELATING TO CONTINUING OPERATIONS

• a. Income tax recognized in profit or loss

Major components of tax expense were as follows:

Current tax In respect of the current year Income tax on unappropriated earnings Adjustments for prior year Deferred tax In respect of the current year Adjustments for prior years Income tax expense recognized in profit or loss	For the Year Ended	For the Year Ended	December 31
		2023 $ 368,140 6,418 (7,090) 367,468 (12,879) (5,045) (17,924) $ 349,544	2022 $ 559,719 19,766 (22,162) 557,323 10,520 - 10,520 $ 567,843

Income tax expense recognized in profit or loss

• 53 -

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

Profit before tax from continuing operations Income tax expense calculated at the statutory rate Tax effect of adjusting items: Non-deductible expenses in determining taxable income Tax-exempt income Deferred tax effect of earnings of subsidiaries Income tax on unappropriated earnings Unrecognized temporary differences Unrecognized loss carryforwards Investment tax credit Effect of different tax rate of group entities operating in other jurisdictions Adjustment for prior years’ tax Effect of tax rate changes Income tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 2,063,246 $ 412,649 3,995 (6,664) 81,051 6,418 907 4,655 (84,715) (56,617) (12,135) - $ 349,544	2022 $ 3,373,347 $ 674,669 8,768 (7,271) 79,672 19,766 1,287 1,095 (124,274) (54,647) (22,162) (9,060) $ 567,843

• b. Income tax expense recognized in other comprehensive income

Deferred tax In respect of the current year Remeasurement of defined benefit plans	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ (757)	2022 $ (2,904)

• c. Current tax assets and liabilities

Current tax assets Tax refund receivable Current tax liabilities Income tax payable		December 31	December 31
		2023 $ 17,525 $ -	2022 $ - $ 204,057

• 54 -

d. Deferred tax assets and liabilities

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

For the year ended December 31, 2023

Opening Balance Recognize in Profit or Loss Recognize in Other Compre- hensive Income Deferred tax assets Unrealized loss on inventories $ 8,435 $ 328 $ - Unrealized exchange loss 11,336 4,899 - Payable for annual leave 8,063 (444) - Determine benefit obligation 9,403 (2,262) (757) Property, plant and equipment 2,677 486 - Financial liabilities at fair value through profit or loss 4,009 941 - Deferred revenue 11,273 1,294 - Others 6,075 1,862 - $ 61,271 $ 7,104 $ (757) Deferred tax liabilities Associates $ 79,518 $ (2,024) $ - Financial assets at fair value through profit or loss 549 (321) - Property, plant and equipment 38,065 (3,430) - $ 118,132 $ (5,775) $ - For the year ended December 31, 2022 Opening Balance Recognize in Profit or Loss Recognize in Other Compre- hensive Income Deferred tax assets Unrealized loss on inventories $ 7,738 $ 688 $ - Unrealized exchange loss 7 11,329 - Payable for annual leave 7,701 335 - Determine benefit obligation 14,722 (2,415) (2,904) Property, plant and equipment 3,045 (412) - Financial liabilities at fair value through profit or loss 1,882 2,100 - Deferred revenue 10,437 695 - Others 4,447 1,597 - $ 49,979 $ 13,917 $ (2,904) Deferred tax liabilities Associates $ 70,598 $ 8,920 $ - Unrealized loss on inventories 34 (34) - Financial assets at fair value through profit or loss - 552 - Property, plant and equipment 22,824 14,999 - $ 93,456 $ 24,437 $ -	Exchange Differences $ (15) - (25) - (49) - (194) (27) $ (310) $ - (6) (559) $ (565) Exchange Differences $ 9 - 27 - 44 27 141 31 $ 279 $ - - (3) 242 $ 239	Closing Balance $ 8,748 16,235 7,594 6,384 3,114 4,950 12,373 7,910 $ 67,308 $ 77,494 222 34,076 $ 111,792 Closing Balance $ 8,435 11,336 8,063 9,403 2,677 4,009 11,273 6,075 $ 61,271 $ 79,518 - 549 38,065 $ 118,132
Deferred tax assets Unrealized loss on inventories Unrealized exchange loss Payable for annual leave Determine benefit obligation Property, plant and equipment Financial liabilities at fair value through profit or loss Deferred revenue Others Deferred tax liabilities Associates Unrealized loss on inventories Financial assets at fair value through profit or loss Property, plant and equipment

• 55 -

e. Income tax assessments

The income tax returns through 2021 had been assessed by the tax authorities.

26. EARNINGS PER SHARE

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

Net Profit for the Year

Profit for the period attributable to owners of the Company Interest on convertible bonds after tax Earnings used in the computation of diluted earnings per share	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 1,713,702 8,517 $ 1,722,219	2022 $ 2,805,504 8,442 $ 2,813,946

Weighted average number of ordinary shares outstanding (in thousand shares):

Weighted average number of ordinary shares in the computation of basic earnings per share Effect of potentially dilutive ordinary shares: Convertible bonds Employees’ compensation Weighted average number of ordinary shares used in the computation of diluted earnings per share	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 309,757 10,563 2,634 322,954	2022 309,757 9,764 4,645 324,166

The Group may settle the compensation paid to employees by cash or shares; therefore, the Group presumes that the entire amount of the compensation will be settled in shares and the resulting potential shares will be included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, if the shares had a dilutive effect. Such dilutive effect of the potential shares was included in the computation of diluted earnings per share until the shareholders resolve the number of shares to be distributed to employees at their meeting in the following year.

27. GOVERNMENT GRANTS

In 2022, the Group received a government grant of $92,084 thousand for its investment of equipment. The amount was recognized as deferred revenue and subsequently transferred to profit or loss over the useful life of the related asset.

28. CAPITAL MANAGEMENT

The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximizing the return to stakeholders through the optimization of the debt and equity balance.

• 56 -

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

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

29. FINANCIAL INSTRUMENTS

• a. Fair value of financial instruments

Fair value of financial instruments not measured at fair value

The management believes the carrying amounts of financial assets and financial liabilities recognized in the consolidated financial statements approximate their fair values.

• b. Fair value of financial instruments measured at fair value on a recurring basis

• 1) Fair value hierarchy

December 31, 2023 Financial assets at FVTPL Foreign exchange forward contracts and exchange contracts Beneficiary certificate Structured deposits Financial liabilities at FVTPL Foreign exchange forward contracts and exchange contracts Financial assets at FVTOCI Domestic emerging market shares Domestic unlisted shares Foreign unlisted shares	Level 1 $ - 288 - $ 288 $ - $ 72,844 - - $ 72,844	Level 2 $ 1,490 - 617,272 $ 618,762 $ 18,323 $ - - - $ -	Level 3 $ - - - $ - $ - $ - 68,056 234,857 $ 302,913	Total $ 1,490 288 617,272 $ 619,050 $ 18,323 $ 72,844 68,056 234,857 $ 375,757

• 57 -

December 31, 2022

Financial assets at FVTPL Domestic listed shares Foreign exchange forward contracts and exchange contracts Beneficiary certificate Structured deposits Financial liabilities at FVTPL Foreign exchange forward contracts and exchange contracts Financial assets at FVTOCI Domestic listed shares Domestic unlisted shares Foreign unlisted shares	Level 1 $ 20,350 - 287 - $ 20,637 $ - $ 262,122 - - $ 262,122	Level 2 $ - 3,662 - 393,151 $ 396,813 $ 13,620 $ - - - $ -	Level 3 $ - - - - $ - $ - $ - 213,170 187,241 $ 400,411	Total $ 20,350 3,662 287 393,151 $ 417,450 $ 13,620 $ 262,122 213,170 187,241 $ 662,533

There were no transfers between Levels 1 and 2 in the current and prior periods of 2023 and 2022.

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

For the year ended December 31, 2023

Financial assets Balance at January 1, 2023 Purchases Transfer to Level 1 Recognized in other comprehensive income beneficiary certificate Effect of foreign currency exchange differences Balance at December 31, 2023	Financial Assets at FVTPL Equity Instruments $ - - - - - $ -	Financial Assets **at FVTOCI **
		Equity Instruments $ 400,411 40,435 (190,879) 56,220 (3,274) $ 302,913

The fair value of these shares issued by Win Win Precision Technology Co., Ltd. was transferred from Level 3 to Level 1 since the shares were listed on the Taipei Exchange on January 16, 2023.

• 58 -

For the year ended December 31, 2022

Financial assets Balance at January 1, 2022 Purchases Reclassified from non-current assets held for sale Recognized in other comprehensive income beneficiary certificate Effect of foreign currency exchange differences Balance at December 31, 2022	Financial Assets at FVTPL Equity Instruments $ - - - - - $ -	Financial Assets at FVTOCI
		Equity Instruments $ 310,824 25,359 4,985 55,745 3,498 $ 400,411

• 3) Valuation techniques and inputs applied for Level 2 fair value measurement

Financial Instruments Valuation Techniques and Inputs

Derivatives - foreign exchange Discounted cash flow. forward contracts and exchange contracts Future cash flows are estimated based on observable forward exchange rates at the end of the reporting period and contract forward rates, discounted at a rate that reflects the credit risk of various counterparties. Structured deposits Discounted cash flow. Future cash flows are discounted at a rate that reflects current borrowing interest rates of the bond issuers at the end of the reporting period Redemption options on Binomial tree valuation model. convertible bonds Binomial tree valuation model was used to evaluate the observable closing price of the stocks, volatility, risk-free interest rate, risk discount rate, and liquidity risk at the balance sheet date.

• 4) Valuation techniques and inputs applied for the purpose of measuring Level 3 fair value measurement

The Group uses price-book ratio approach, comparing the net value per share with other public companies among similar industries or evaluating share price based on average price-book ratio of other competitors, to capture the present value of the expected future economic benefits to be derived from the ownership of these investees.

The fair values of unlisted equity securities - ROC were determined using income approach. In this approach, the discounted cash flow method was used to capture the present value of the expected future economic benefits to derived from the ownership of these investees. The significant unobservable inputs used are listed in the table below. An increase in long-term revenue growth rates or long-term pre-tax operating margin or a decrease in the WACC or discount for lack of marketability used in isolation would result in increase in the fair value.

• 59 -

c. Categories of financial instruments

Financial assets FVTPL Mandatorily at FVTPL (1) Financial assets at amortized cost (2) Financial assets at FVTOCI Equity instruments Financial liabilities FVTPL Mandatorily as at FVTPL (3) Amortized cost (4)	December 31
	2023 2022 $ 619,050 $ 417,450 7,796,196 8,223,316 375,757 662,533 18,323 13,620 6,599,297 6,814,283

• 1) The balances included the carrying amount of beneficiary certificate, foreign exchange forward contracts and exchange contracts, structured deposits, redemption options on convertible bonds and investment of equity instruments.

• 2) The balances included financial assets measured at amortized cost, which comprise cash and cash equivalents, notes receivable, trade receivables, other receivables and refundable deposits.

• 3) The balances included the carrying amount of foreign exchange forward contract and exchange contracts.

• 4) The balances included financial liabilities measured at amortized cost, which comprise short-term and long-term loans, bonds payable, trade payables, other payables and guarantee deposits received.

• d. Financial risk management objectives and policies

The Group’s major financial instruments included equity and debt investments, notes receivables, trade receivables, other receivables, notes payables, trade payables, other payables, bonds payable, borrowings. The Group’s corporate treasury function provides services to the business, coordinates access to domestic and international financial markets, and monitors and manages the financial risks relating to the operations of the Group through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include foreign currency risk, interest rate risk, other price risk, credit risk and liquidity risk.

The Group sought to minimize the effects of these risks by using derivative financial instruments to hedge risk exposures. The use of financial derivatives was governed by the Group’s policies approved by the board of directors, which provided written principles on foreign currency risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits was reviewed by the internal auditors on a continuous basis. The Group did not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

• 60 -

The corporate treasury function reports quarterly to the Group’s risk management committee, an independent body that monitors risks and policies implemented to mitigate risk exposures.

1) Market risk

The Group’s activities exposed it primarily to the financial risks of changes in foreign currency exchange rates (see (a) below) and interest rates (see (b) below). The Group entered into a variety of derivative financial instruments to manage its exposure to foreign currency risk and interest rate risk, including: Foreign exchange forward contracts to hedge the exchange rate risk arising on the Group’s foreign currency monetary.

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

a) Foreign currency risk

Several subsidiaries of the Company have foreign currency sales and purchases, which exposes the Group to foreign currency risk.

The carrying amounts of the Group’s foreign currency-denominated monetary assets and monetary liabilities (including those eliminated on consolidation) at the end of the reporting period (see Note 35).

Sensitivity analysis

The Group is mainly exposed to the USD and JPY.

The following table details the Group’s sensitivity to a 1% increase and decrease in the New Taiwan dollar (the functional currency) against the relevant foreign currencies. The sensitivity rate used when reporting foreign currency risk internally to key management personnel and representing management’s assessment of the reasonably possible change in foreign exchange rates is 1%. The sensitivity analysis included only outstanding foreign currency-denominated monetary items and foreign exchange forward contracts designated as cash flow hedges and their adjusted their translation at the end of the reporting period for a 1% change in foreign currency rates. The sensitivity analysis included external loans/borrowings as well as loans/borrowings to foreign operations within the Group where the denomination of the loan is in a currency other than the functional currency of the lender or the borrower. A positive number below indicates an increase in post-tax profit and other equity associated with the New Taiwan dollar strengthening 1% against the relevant currency. For a 1% weakening of the New Taiwan dollar against the relevant currency, there would be an equal and opposite impact on post-tax profit and other equity and the balances below would be negative.

Profit or loss	USD Impact (i) For the Year Ended December 31 2023 2022 $ 29,011 $ 33,590	JPY Impact (ii)
		For the Year Ended December 31
		2023 2022 $ (6,328) $ (3,392)

• i. This was mainly attributable to the exposure on outstanding on USD monetary items, which were not hedged, at the end of the reporting period.

• ii. This was mainly attributable to the exposure on outstanding JPY monetary items, which were not hedged at the end of the reporting period.

• 61 -

b) Interest rate risk

The Group is exposed to interest rate risk because entities in the Group deposit and borrow funds at floating interest rates.

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

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities Sensitivity analysis	**December 31 **
	2023 2022 $ 941,596 $ 1,164,521 2,107,241 3,474,901 3,560,277 3,408,887 1,892,754 635,507

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

If interest rates had been 25 basis points higher/lower and all other variables were held constant, the Group’s pre-tax profit for the years ended December 31, 2023 and 2022 would increase/(decrease) by $4,169 thousand and $6,933 thousand, respectively, which was mainly attributable to the Group’s exposure to interest rates on its floating rate bank deposits and bank borrowings.

2) Credit risk

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

• a) The carrying amount of the respective recognized financial assets as stated in the balance sheets; and

• b) The maximum amount the entity would have to pay if the financial guarantee is called upon, irrespective of the likelihood of the guarantee being exercised.

3) Liquidity risk

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

• 62 -

The Group relies on bank borrowings as a significant source of liability. As of December 31, 2023 and 2022, the Group had available unutilized short-term bank loan facilities of $8,529,625 thousand and $6,774,251 thousand, respectively.

• Liquidity and interest rate risk tables for non-derivative financial liabilities

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

To the extent that interest flows are floating rate, the undiscounted amount was derived from the interest rate curve at the end of the reporting period.

December 31, 2023

	Weighted
	Average
	Effective
	Interest Rate	Less than
	(%)	1 Year		2-3 Years		4-5 Years		5+ Years			Total
Non-derivative financial
liabilities
Trade payables		$ 1,415,928	$	-	$	-	$		-	$	1,415,928
Other payables		1,103,583		-		-			-		1,103,583
Lease liabilities	1.27%-3.85%	5,958		6,714		-			-		12,672
Variable interest rate
liabilities	0.85%-1.55%	276,087		1,616,667		-			-		1,892,754
Fixed interest rate liabilities	2.83%-6.47%	1,841,143		222,708		43,390			-		2,107,241
December 31, 2022
	Weighted
	Average
	Effective
	Interest Rate	Less than
	(%)	1 Year		2-3 Years		4-5 Years		5+ Years			Total
Non-derivative financial
liabilities
Trade payables	-	$ 1,209,119	$	-	$	-	$		-	$	1,209,119
Other payables	-	1,423,229		-		-			-		1,423,229
Lease liabilities	0.86%-1.27%	3,088		3,399		-			-		6,487
Variable interest rate
liabilities	0.725%-0.975%	248,087		354,087		33,333			-		635,507
Fixed interest rate liabilities	0.90%-5.49%	1,156,448		2,279,272		39,181			-		3,474,901

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

• 63 -

• Liquidity and interest rate risk tables for derivative financial liabilities

The following table details the Group’s liquidity analysis of its derivative financial instruments. The table is based on the undiscounted contractual net cash inflows and outflows on derivative instruments that settle on a net basis, and the undiscounted gross inflows and outflows on those derivatives that require gross settlement.

December 31, 2023

On Demand or Less Than 1 Month 1-3 Months 3 Months to 1 Year Net settled Foreign exchange forward contracts and exchange contracts$ 1,739 $ (13,381) $ (5,191) December 31, 2022 On Demand or Less Than 1 Month 1-3 Months 3 Months to 1 Year Net settled Foreign exchange forward contracts and exchange contracts$ (1,549) $ (9,097) $ 688	1-5 Years $ - 1-5 Years $ -	5+ Years $ -
		5+ Years $ -

30. TRANSACTIONS WITH RELATED PARTY

Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note. Details of transactions between the Group and other related parties are disclosed below.

• a. Related Party Name and Category

Related Party Name Tai-shing Electronics Components Corp. TSE Technology (Ningbo) Co., Ltd. EcLife Co., Ltd. Ningbo Longying Semiconductor Co., Ltd. PETER LIN	Related Party Category
	Associate Associate Other associate Other associate Chairman of the Company

• b. Sales of goods

Related Party Category Associates Other associates Chairman of the Company	For the Year Ended	For the Year Ended	December 31
		2023 $ 30,284 5,907 5,148 $ 41,339	2022 $ 73,936 12,339 12,896 $ 99,171

Selling prices and payment terms offered to related parties were similar with those offered to third parties.

• 64 -

c. Purchases of goods

Related Party Category Other associates	For the Year Ended	For the Year Ended	December 31
		2023 $ 2,056	2022 $ 2,873

Purchase prices and payment terms offered by related parties were similar with those offered by third parties.

• d. Operating expenses

Other associates

Related Party Category

For the Year Ended December 31 2023 2022 $ 628 $ 2,033

• e. Commission revenue

Associates

Related Party Category

For the Year Ended December 31 2023 2022 $ 1,493 $ 1,505

• f. Rental revenue

Related Party Location Rent Collection Ningbo Xingmao Electron Technology Co., Ltd. Building P5, 1F., No. 189, Huangshan W. Rd., Beilun Dist., Ningbo City Based on contract, and paid on a monthly basis Ningbo Longying Semiconductor Co., Ltd. Building D4, No. 189, Huangshan W. Rd., Beilun Dist., Ningbo City Based on contract, and paid on a monthly basis Tai-Shing Electronics Components Corporation 6F., No. 4, Gongye 6th Rd., Pingzhen Dist., Taoyuan City 324, Taiwan Based on contract, and paid on a monthly basis		For the Year Ended	For the Year Ended	December 31
		2023 Amount % to Total Account Balance $ 4,521 - 176 - 3,568 - $ 8,265		2022
				Amount % to Total Account Balance $ 4,558 - 177 - 3,518 - $ 8,253

There is no significant difference in transaction terms between related parties and unrelated parties.

• g. Receivables from related parties (excluding loans to related parties)

Related Party Category Associates Other associates Less: Allowance for impairment loss		**December 31 **	**December 31 **
		2023 $ 7,405 1,040 (68) $ 8,377	2022 $ 8,171 1,748 (68) $ 9,851

• 65 -

The outstanding trade receivables from related parties are unsecured.

• h. Payables to related parties (excluding loans from related parties)

Other associates

Related Party Category

	**December 31 **	**December 31 **
	2023 $ 970	2022 $ 622

The outstanding trade payables from related parties are unsecured.

Payment term of the transactions to related parties were similar to those for third parties.

• i. Other receivables from related parties

Related Party Category Associates Other		**December 31 **	**December 31 **
		2023 $ 1,192 1 $ 1,193	2022 $ 635 8 $ 643

• j. Other payables to related parties

Related Party Category Other associates Chairman of the Company		December 31	December 31
		2023 $ 1,825 164 $ 1,989	2022 $ 1,250 - $ 1,250

• k. Prepayments for equipment

Related Party Category Other associates Acquisitions of property, plant and equipment Related Party Category Other associates Lease arrangements - Group is lessee Related Party Categories Acquisition of right-to-use assets Chairman of the Company		December 31	December 31
		2023 2022 $ 4,502 $ 4,357 Acquisition Amounts
		2023 2022 $ 968 $ 16,106 December 31
		2023 $ 5,716	2022 $ -

• l. Acquisitions of property, plant and equipment

• m. Lease arrangements - Group is lessee

• 66 -

Line Item Related Party Category Lease liabilities - current Chairman of the Company PETER LIN Lease liabilities - non-current Chairman of the Company PETER LIN Related Party Category Interest expense Chairman of the Company Related Party Category Lease expense Chairman of the Company		December 31	December 31
		2023 2022 $ 1,592 $ - $ 2,632 $ - December 31
		2023 2022 $ 84 $ - December 31
		2023 $ 1,648	2022 $ -

• n. Compensation of key management personnel

Short-term benefits Post-employment benefits	For the Year Ended	For the Year Ended	December 31
		2023 $ 125,237 3,638 $ 128,875	2022 $ 186,665 3,671 $ 190,336

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

31. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets were provided as collateral for bank borrowings:

Building and equipment, net Investment property Pledged deposits Right-of-use assets		**December 31 **	**December 31 **
		2023 $ 299,565 11,354 99,349 10,174 $ 420,442	2022 $ 247,376 13,147 70,259 10,710 $ 341,492

• 67 -

32. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

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

• a. Unused letters of credit amounted to approximately JPY6,400 thousand as of December 31, 2023.

• b. On November 8, 2021, the board of directors of the Company approved its subsidiary TETC CORP. NINGBO to construct a plant project, with an estimated investment of RMB145,000 thousand. On April 19, 2022, the Company signed a construction contract. The total contract amount divided into paid and unpaid is as follows:

Contract Amount Paid Amount Unpaid Amount (Tax Included) (Tax Included) (Tax Included) Property, plant and equipment RMB 101,880 RMB 69,903 RMB 31,977

• c. As of December 31, 2023, the Company unrecognized commitments were as follows:

			Contract
			Amount	Paid	Amount	Unpaid Amount
			(Tax Excluded)	(Tax Excluded)		(Tax Excluded)
Acquisition	of machinery	and equipment	$ 490,554	$	212,157	$	278,397
Acquisition	of machinery	and equipment	RMB 112,621	RMB	24,688	RMB	87,933
Acquisition	of machinery	and equipment	JPY 392,700	JPY	112,110	JPY	280,590
Acquisition	of machinery	and equipment	USD 583	USD	193	USD	390

33. SIGNIFICANT EVENTS AFTER REPORTING PERIOD: NONE

34. OTHER ITEMS

On December 18, 2023, the Company’s board of directors approved that TXC (Ningbo) Corporation establish a subsidiary named PT TXC TECHNOLOGY INDONESIA (tentative name), with an ownership percentage of 80%. The authorized capital is US$20,000 thousand, and it is expected that US$10,000 thousand will be injected into capital by the second quarter of 2024.

• 68 -

35. EXCHANGE RATE OF FINANCIAL ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The significant financial assets and liabilities of entities in Group denominated in foreign currencies aggregated by the foreign currencies other than functional currencies and the related exchange rates between foreign currencies and respective functional currencies were as follows:

Unit: In Thousands of Foreign Currencies and New Taiwan Dollars

December 31, 2023

		Foreign		Carrying
		Currency	Exchange Rate	Amount
Financial assets
Monetary items
USD	$	91,758	30.7350 (USD:NTD)	$ 2,820,182
USD		10,743	7.0827 (USD:RMB)	330,186
JPY		241,127	0.2173 (JPY:NTD)	52,397
JPY		39,564	0.0501 (JPY:RMB)	8,597
JPY		33,957	0.0071 (JPY:USD)	7,379
Financial liabilities
Monetary items
USD		5,515	30.7350 (USD:NTD)	169,504
USD		2,596	7.0827 (USD:RMB)	79,788
JPY		1,541,190	0.2173 (JPY:NTD)	334,973
JPY		1,636,942	0.0501 (JPY:RMB)	355,707
JPY		48,361	0.0071 (JPY:USD)	10,509
December 31, 2022
		Foreign		Carrying
		Currency	Exchange Rate	Amount
Financial assets
Monetary items
USD	$	139,256	30.7080 (USD:NTD)	$ 4,276,273
USD		4,148	6.9646 (USD:RMB)	127,377
JPY		533,718	0.2324 (JPY:NTD)	124,036
JPY		306,521	0.0527 (JPY:RMB)	71,245
JPY		110,132	0.0076 (JPY:USD)	25,595
Financial liabilities
Monetary items
USD		25,887	30.7080 (USD:NTD)	794,938
USD		8,133	6.9646 (USD:RMB)	249,748
JPY		1,338,747	0.2324 (JPY:NTD)	311,125
JPY		974,054	0.0527 (JPY:RMB)	226,370
JPY		97,085	0.0076 (JPY:USD)	22,563

• 69 -

For the years ended December 31, 2023 and 2022, realized and unrealized net foreign exchange gains (losses) were $68,611 thousand and $436,249 thousand, respectively. It is impractical to disclose net foreign exchange gains (losses) by each significant foreign currency due to the variety of the foreign currency transactions and functional currencies of the group entities.

36. SEPARATELY DISCLOSED ITEMS

• a. Information about significant transactions and investees:

• 1) Lending funds to others. (None)

• 2) Providing endorsements or guarantees for others. (None)

• 3) Holding of securities at the end of the period. (Table 1)

• 4) Aggregate purchases or sales of the same securities reaching NT$300 million or 20% of paid-in capital or more. (None)

• 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 real estate at prices of at least NT$300 million or 20% of the paid-in capital. (None)

• 7) Purchases or sales of goods or to related parties reaching least NT$100 million or 20% of the paid-in capital. (Table 2)

• 8) Trade receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital. (Table 3)

• 9) Trading in derivative instruments. (Note 7)

• 10) Others: Intercompany relationships and significant intercompany transactions. (Table 7)

• b. Information on investees. (Table 4)

• c. Information on investments in mainland China

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

• 2) Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses: (Table 6)

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

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

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

• 70 -

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

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

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

• d. Information of major shareholders: List all shareholders with ownership of 5% or greater showing the name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder (None)

37. SEGMENT INFORMATION

Information reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided. Specifically, the Group’s reportable segments under IFRS 8 “Operating Segments” were as follows:

• a. Crystal segment

The chief operating decision maker see every crystal selling unit in Taiwan and China as an operating segment. While preparing the financial report, the Group considers the following reasons:

• 1) The similar gross profit between the selling units.

• 2) The similar product’s nature and manufacturing process.

• 3) The same product’s delivery type.

• b. Real estate development segment

The department and sales of real estate, along with mall space leasing in Chongqing is considered a separate operating segment by the chief operating decision maker (CODM).

Segment revenue and results

Crystal segment Real estate development segment Continuing operations Interest income Other income Other gains and losses Finance costs Share of profit of associates and joint ventures for using the equity method Profit before tax (continuing operations)		Segment Revenue For the Year Ended December 31 2023 2022 $ 10,827,498 $ 13,104,001 22,904 65,687 $ 10,850,402 $ 13,169,688		Segment Profit	Segment Profit
				For the Year Ended December 31
		2023 $ 10,827,498 22,904 $ 10,850,402		2023 $ 1,882,543 (13,522) 1,869,021 77,204 163,029 7,038 (57,619) 4,573 $ 2,063,246	2022 $ 2,804,395 6,819 2,811,214 27,435 173,762 392,657 (48,847) 17,126 $ 3,373,347

• 71 -

Segment revenue reported above represents revenue generated from external customers. There were no inter-segment sales for the years ended December 31, 2023 and 2022.

Segment profit represents the profit before tax earned by each segment without allocation of central administration costs and directors’ salaries, share of profit of associates, gains recognized on disposal of interests in former associates, rental revenue, interest income, gains or losses on disposal of property, plant and equipment, gains or losses on disposal of financial instruments, exchange gains or losses, valuation gains or losses on financial instruments, finance costs and income tax expense. This was the measure reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance.

c. Revenue from major products and services

Crystals Oscillators Construction contract revenue Others	2023 $ 8,518,531 2,057,750 22,904 251,217 $ 10,850,402	2022 $ 9,932,466 2,455,314 65,687 716,221 $ 13,169,688

d. Geographical information

The Group’s operates in two principal geographical areas - Taiwan and China.

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

Taiwan Asia America Europe Others	Revenue from External Customers For the Year Ended December 31 2023 2022 $ 399,710 $ 632,320 9,877,194 11,802,007 328,259 462,159 230,349 249,953 14,890 23,249 $ 10,850,402 $ 13,169,688	Revenue from External Customers For the Year Ended December 31 2023 2022 $ 399,710 $ 632,320 9,877,194 11,802,007 328,259 462,159 230,349 249,953 14,890 23,249 $ 10,850,402 $ 13,169,688		Non-current Assets	Non-current Assets
				December 31
		2023 $ 399,710 9,877,194 328,259 230,349 14,890 $ 10,850,402		2023 $ 2,878,665 4,041,775 1,220 397 - $ 6,922,057	2022 $ 3,019,491 4,235,131 1,332 428 - $ 7,256,382

Non-current assets included property, plant and equipment, intangible assets and other assets but excluded deferred tax assets and financial instruments.

e. Major customer information

Single customers contributing 10% or more to the Group’s revenue were as follows:

F Group	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 2,101,830	2022 $ 2,502,897

• 72 -

TABLE 1

TXC CORPORATION AND SUBSIDIARIES

MARKETABLE SECURITIES HELD DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account			December	31, 2023			Note
				Shares		Carrying Amount	Percentage of Ownership		Fair Value
TXC Corporation TXC (Ningbo) Corporation TXC (Chongqing) Corporation Ningbo Beilun Jingyu Trading Corporation Ningbo Meishan Free Trade Port Area Ding Kai Investment Management Company Limited	Stock-unlisted company Godsmith Sensor Inc RFIC Technology Corporation Gallopwave Inc. Stock-emerging shares Win Win Precision Technology Co., Ltd. Shares overseas-unlisted company Stathera IP Holdings Inc. Shares overseas-unlisted company Ningbo SJ Electronics Co., Ltd. Structured deposits China Construction Bank China Merchants Bank China CITIC Bank China Minsheng Bank China Everbright Bank Beneficiary certificate Southern Cash Fund Shares overseas-unlisted company Zhejiang Bright Semiconductor Technology Co., Ltd.	None TXC Corporation is a director of the Company ″ None ″ None None ″ ″ ″ ″ None None	Financial assets at fair value through other comprehensive income - non-current ″ ″ ″ ″ Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through profit or loss - current ″ ″ ″ ″ Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - non-current	800 3,334 6,250 1,788 65 567 RMB 84,059 RMB 15,056 RMB 12,759 RMB 3,092 RMB 10,039 RMB 66 7,004		$ 3,672 29,981 34,403 72,844 30,435 $ 171,335 $ 41,995 $ 364,766 65,334 55,364 13,417 43,562 $ 542,443 $ 288 $ 162,427	4 12 8 3 1 5 - - - - - - 3		$ 3,672 29,981 34,403 72,844 30,435 $ 171,335 $ 41,995 $ 364,766 65,334 55,364 13,417 43,562 $ 542,443 $ 288 $ 162,427

(Continued)

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Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account			**December **	31, 2023			Note
				Shares		Carrying Amount	Percentage of Ownership		Fair Value
Chongqing Zhongyang Properties Co., Ltd. ChongQing Dingsen Commercial Management Co., Ltd.	Structured deposits Chongqing Rural Commercial Bank China Construction Bank Corporation Structured deposits China Construction Bank Corporation	None None None	Financial assets at fair value through profit or loss - current ″ Financial assets at fair value through profit or loss - current	RMB 9,617 RMB 6,971 RMB 656		$ 41,730 30,251 $ 71,981 $ 2,848	- - -		$ 41,730 30,251 $ 71,981 $ 2,848

(Concluded)

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TABLE 2

TXC CORPORATION 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, 2023

(In Thousands of New Taiwan Dollars)

Buyer	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	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
TXC Corporation TXC (Ningbo) Corporation	TXC (Ningbo) Corporation ″ TXC (Chongqing) Corporation TETC CORP. NINGBO TXC (Chongqing) Corporation ″	Subsidiary ″ ″ ″ ″ ″	Purchase Sale Purchase Purchase Purchase Sale	$ 1,885,105 652,731 1,680,693 394,530 221,875 446,800	31 7 28 7 12 11	No significant differences with the third parties. ″ ″ ″ ″ ″	Its trading price depends on its function within the Group ″ ″ ″ ″ ″	No significant differences with the third parties. ″ ″ ″ ″ ″	$ (427,317) 175,833 (540,231) (101,648) (73,895) 217,271	(27) 6 (34) (6) (11) 22

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TABLE 3

TXC CORPORATION AND SUBSIDIARIES

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL DECEMBER 31, 2023

(In Thousands of New Taiwan Dollars)

Company Name	Related Party	Relationship	Ending Balance	Turnover Rate	Overdue	Overdue	Amount Received in Subsequent Period	Allowance for Impairment Loss
					Amount	**Action Taken **
TXC Corporation TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO TXC (Ningbo) Corporation	TXC (Ningbo) Corporation TXC Corporation TXC Corporation TXC Corporation TXC (Chongqing) Corporation	Subsidiary Parent entity Parent entity Parent entity Subsidiary	$ 175,833 427,317 540,231 101,648 217,271	3.70 3.77 4.12 4.43 3.78	$ - - - - -	- - - - -	$ 91,877 262,292 317,516 57,775 45,668	$ - - - - -

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TABLE 4

TXC CORPORATION AND SUBSIDIARIES

NAMES, LOCATIONS, AND RELATED INFORMATION OF INVESTEES ON WHICH THE COMPANY EXERCISES SIGNIFICANT INFLUENCE DECEMBER 31, 2023

(In Thousands of New Taiwan Dollars or U.S. Dollars)

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount	Original Investment Amount	As of December 31,	As of December 31,	2023	Net Income (Losses) of the Investee	Share of Profits (Loss)	Note
				December 31, 2023	December 31, 2022	Shares (In Thousands)	Percentage of Ownership	Carrying Value
TXC Corporation	Taiwan Crystal Technology International Ltd. Taiwan Crystal Technology International (HK) Limited TXC Japan Corporation TXC Technology Inc. Tai-Shing Electronics Components Corporation TXC Europe GmbH	Western Samoa Hong Kong Japan U.S.A. Taiwan Germany	Investment management International trading Marketing activities Marketing activities Manufacture and sales of electronics products Marketing activities	$ 1,390,461 2,371 6,172 9,879 373,432 1,746	$ 1,390,461 2,371 6,172 9,879 373,432 1,746	42,835 80 2 300 8,802 50	100.00 100.00 100.00 100.00 33.34 100.00	$ 7,563,696 193,100 32,358 23,290 397,952 11,300	$ 968,668 682 2,843 1,446 62,255 1,856	$ 956,623 682 2,843 1,446 20,756 1,856

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TABLE 5

TXC CORPORATION AND SUBSIDIARIES

INFORMATION ON INVESTMENTS IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars or U.S. Dollars)

1. Name of the investees in mainland China, main businesses and products, paid-in capital, method of investment, information on inflow or outflow of capital, percentage of ownership, investment income or loss, ending balance of investment, dividends remitted by the investee, and the limit of investment in mainland China:

Investee Company	Main Businesses and Products	Main Businesses and Products	Total Amount of Paid-in Capital	Method of Investment	Method of Investment	Accumulated Outflow of Investments from Taiwan as of January 1, 2023 (In Thousand)	Investment Flows	Investment Flows	Accumulated Outflow of Investment from Taiwan as of December 31, 2023 (In Thousand)	Investee Company Current Net Income	Percentage of Ownership	Investment Income (Loss) Recognized	Carrying Amount as of December 31, 2023	Accumulated Inward Remittance of Earnings as of December 31, 2023
							Outflow	Inflow
TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO Chongqing Zhongyang Properties Co., Ltd. Ningbo Beilun Jingyu Trading Corporation Ningbo Longying Semiconductor Co., Ltd. Ningbo Meishan Free Trade Port Area Ding Kai Investment Management Company Limited ChongQing Dingsen Commercial Management Co., Ltd. Shanghai JCH Co., Ltd	Research and development, manufacture, and sale of quartz elements and related electronic products Research and development, manufacture, and sale of quartz elements and related electronic products Research and development, manufacture, and sale of quartz elements and related electronic products Properties development International trading Research and development in integrated circuit Investment management Property management Marketing activities and Technical Services		$ 2,350,052 1,162,074 433,440 684,908 7,090 246,257 160,043 4,390 2,238	Indirect investment of the Corporation in mainland China through the Corporation’s subsidiary in a third region Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China		$ 1,427,630 - - - - - - - -	$ - - - - - - - - -	$ - - - - - - - - -	$ 1,427,630 - - - - - - - -	$ 968,692 200,040 325,299 (25,883) (26) (54,408) 1 (8) 8,746	100.000.00 100.00 100.00 100.00 100.00 29.37 100.00 100.00 100.00	$ 968,692 200,040 325,299 (25,883) (26) (16,184) 1 (8) 8,746	$ 7,630,212 1,819,130 1,244,942 775,004 6,086 48,174 162,694 (1,209) 10,798	$ 1,390,136 306,500 - - - - - - -
The limited amounts of the investment in mainland China
Accumulated Outward Remittance for Investments in mainland China as of December 31, 2023		Investment Amounts Authorized by the Investments Commission, MOEA			Upper Limit on the Amount of Investments Stipulated by Investment Commission, MOEA
$ 1,427,630		$ 2,350,052			$ -

1. The limited amounts of the investment in mainland China

Note: The investment in mainland China has no maximum limit since the Company has acquired the approval from the Industrial Development Bureau for the establishment of the Company’s operating headquarters in Taiwan.

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TABLE 6

TXC CORPORATION AND SUBSIDIARIES

SIGNIFICANT TRANSACTIONS WITH INVESTEE COMPANIES IN MAINLAND CHINA, EITHER DIRECTLY OR INDIRECTLY THROUGH A THIRD PARTY, AND THEIR PRICES, PAYMENT TERMS, AND UNREALIZED GAINS OR LOSSES FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

1. Significant direct or indirect transactions with the investees, prices and terms of payment, unrealized gain or loss:

Company Name	Related Party	Transaction Type	Purchase/Sale	Purchase/Sale	Price	Transaction Details	Transaction Details	Accounts/Notes Receivable (Payable)	Accounts/Notes Receivable (Payable)	Unrealized (Gain) Loss	Note
			Amount	%		Payment Term	Comparison with **Normal Transaction **	Ending Balance	%
TXC Corporation	TXC (Ningbo) Corporation TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO	Purchase Sale Purchase Purchase	$ 1,885,105 652,731 1,680,693 394,530	31 7 28 7	Its trading price depends on its function within the Group ″ ″ ″	Similar with third parties ″ ″ ″	Its trading price depends on its function within the Group ″ ″ ″	$ (427,317) 175,833 (540,231) (101,648)	(27) 6 (34) (6)	$ 30,702 7,186 23,131 7,486

1. The transactions of properties and the profit or loss: None.

2. Endorsements guarantees or collateral directly or indirectly provided to the investees: None

3. Financing directly or indirectly provided to the investees: None

4. Other transactions that significantly impacted the current year’s profit or loss or financial position: None

5. 79 -

TABLE 7

TXC CORPORATION AND SUBSIDIARIES

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT INTERCOMPANY TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 2023

(In Thousands of New Taiwan Dollars)

For the year ended December 31, 2023

No.	Company Name	Counterparty	Nature of Relationship (Note 1)	Intercompany Transactions	Intercompany Transactions	Intercompany Transactions
				Accounts	Amount	Terms (Note 2)	Percentage of Consolidated Total Gross Sales or Total Assets (%)
0	TXC Corporation	TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO	a a a	Sales Purchase Trade receivables Trade payables Purchase Trade payables Purchase Trade payables	$ 652,731 1,885,105 175,833 427,317 1,680,693 540,231 394,530 101,648	a a a a a a a a	6 17 1 2 15 3 4 1
1	TXC (Ningbo) Corporation	TXC (Chongqing) Corporation	c	Purchase Sales Trade receivables Trade payables	221,875 446,800 217,271 73,895	c c c c	2 4 1 -

Note 1: a. Represent the transactions from parent company to subsidiary.

• c. Represent the transactions between subsidiaries.

• Note 2: In 2023, the selling price and purchasing price were not significantly different from those of third parties, except those for TXC (Ningbo) Corporation, TXC (Chongqing) Corporation, TETC CORP. NINGBO and Taiwan Crystal Technology (HK) Limited which is depending on its function within the Group.

Note 3: The Company may decide whether to list the material transactions in this table according to the principle of materiality.

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