TXC — Audit Report / Information 2024

Nov 13, 2024

TXC Corporation

Parent Company Only Financial Statements for the Years Ended December 31, 2024 and 2023 and Independent Auditors’ Report

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders TXC Corporation

Opinion

We have audited the accompanying parent company only financial statements of TXC Corporation (the “Company”), which comprise the parent company only balance sheets as of December 31, 2024 and 2023, and the parent company only statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the parent company only financial statements, including material accounting policy information (collectively referred to as the “parent company only financial statements”).

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the parent company only financial position of the Company as of December 31, 2024 and 2023, and its parent company only financial performance and its parent company only cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing 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 Parent Company Only Financial Statements section of our report. We are independent of the Company in accordance with The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the parent company only financial statements for the year ended December 31, 2024. These matters were addressed in the context of our audit of the parent company only 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 Company’s parent company only financial statements for the year ended December 31, 2024 is stated as follows:

For the year ended December 31, 2024, the Company’s revenue was approximately 12% more compared to its revenue for the year ended December 31, 2023. In comparison with 2023, the revenue derived from specific product applications increased; therefore, we considered the occurrence of revenue derived from specific product applications as a key audit matter.

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 product applications, checked the sales orders, delivery notes, shipping documents and invoices of the relevant transactions and reconcile them with the recorded amounts to confirm the authenticity of the revenue.

3. Obtain the subsequent receipt details for specific product applications, verify the related supporting documents, and examine whether there are any anomalies between the sales counterparties and the payment counterparties to ensure the authenticity of revenue.

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

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

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

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

Auditors’ Responsibilities for the Audit of the Parent Company Only Financial Statements

Our objectives are to obtain reasonable assurance about whether the parent company only 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 parent company only 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 parent company only 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 Company’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 Company’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 parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.

5. Evaluate the overall presentation, structure and content of the parent company only financial statements, including the disclosures, and whether the parent company only 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 the entities or business activities within the Company to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements for the year ended December 31, 2024 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 Yi-Hua Peng.

Deloitte & Touche Taipei, Taiwan Republic of China

March 10, 2025

Notice to Readers

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

For the convenience of readers, the independent auditors’ report and the accompanying parent company only 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 financial statements shall prevail.

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TXC CORPORATION

PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2024 AND 2023 (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 26) Financial assets at amortized cost - current (Notes 4 and 9) Trade receivables (Notes 4 and 10) Trade receivables from related parties (Notes 4, 10 and 27) Other receivables (Notes 4 and 10) Other receivables from related parties (Notes 4 and 27) Current tax assets (Notes 4 and 23) 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 26) Investments accounted for using the equity method (Notes 4 and 12) Property, plant and equipment (Notes 4 and 13) Right-of-use assets (Notes 4 and 14) Investment properties (Notes 4 and 15) Intangible assets (Note 4) Deferred tax assets (Notes 4 and 23) Prepayment for equipment Refundable deposits Net defined benefit assets - non-current (Note 4 and 19) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Financial liabilities at fair value through profit or loss - current (Notes 4, 7 and 26) Trade payables Trade payables to related parties (Note 27) Other payables (Note 18) Other payables to related parties (Note 27) Current tax liabilities (Notes 4 and 23) Lease liabilities - current (Notes 4 and 14) Current portion of long-term borrowings and bonds payable (Notes 16 and 17) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Long-term borrowings (Note 16) Deferred tax liabilities (Notes 4 and 23) Lease liabilities - non-current (Notes 4 and 14) Net defined benefit liabilities - non-current (Notes 4 and 19) Guarantee deposits received Total non-current liabilities Total liabilities EQUITY (Note 20) 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		2024 Amount % $ 2,296,766 11 61,965 - 78,674 - 2,703,385 14 351,713 2 60,308 - 1,086 - 78,982 - 1,503,653 8 129,062 1 7,265,594 36 96,392 1 9,587,307 48 2,482,549 13 11,302 - 15,966 - 9,130 - 23,383 - 412,507 2 3,572 - 5,227 - 12,647,335 64 $ 19,912,929 100 $ - - 545,977 3 1,100,132 6 692,348 4 16,852 - 49,629 - 4,896 - 419,333 2 71,630 - 2,900,797 15 533,333 3 108,649 - 6,511 - - - 39,284 - 687,777 3 3,588,574 18 3,429,930 17 - - 3,429,930 17 4,622,137 23 2,437,715 12 527,767 3 5,379,666 27 8,345,148 42 (140,531) (1) 67,671 1 (72,860) - 16,324,355 82 $ 19,912,929 100		2023
				Amount % $ 1,972,837 11 - - 75,342 1 2,548,323 14 219,990 1 26,341 - 7,828 - 74,030 1 1,466,069 8 14,911 - 6,405,671 36 171,335 1 8,221,696 46 2,582,189 15 3,867 - 17,225 - 13,593 - 47,746 - 259,225 2 2,566 - - - 11,319,442 64 $ 17,725,113 100 $ 18,323 - 506,797 3 1,074,959 6 625,593 4 1,869 - - - 2,270 - 1,829,907 10 30,333 - 4,090,051 23 1,652,667 9 77,493 1 1,631 - 20,105 - 9,550 - 1,761,446 10 5,851,497 33 3,097,570 17 9 - 3,097,579 17 1,718,693 10 2,243,247 13 143,071 1 5,198,793 29 7,585,111 43 (582,706) (3) 54,939 - (527,767) (3) 11,873,616 67 $ 17,725,113 100

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

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TXC CORPORATION

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

SALES (Note 21) COST OF GOODS SOLD (Notes 11 and 22) GROSS PROFIT UNREALIZED GAIN ON TRANSACTIONS WITH ASSOCIATES/AND JOINT VENTURES REALIZED GAIN ON TRANSACTIONS WITH ASSOCIATES/AND JOINT VENTURES REALIZED GROSS PROFIT OPERATING EXPENSES (Notes 4 and 22) Selling and marketing expenses General and administrative expenses Research and development expenses Expected credit gain Total operating expenses PROFIT FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES Interest income (Note 22) Other income (Notes 4 and 22) Other gains and losses (Note 22) Finance costs (Notes 4 and 22) Shares of profits of associates and joint ventures (Note 12) Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Note 23) NET PROFIT FOR THE YEAR		2024 Amount % $ 9,821,044 100 7,672,257 78 2,148,787 22 (14,091) - 9,266 - 2,143,962 22 261,769 3 247,924 2 723,146 7 - - 1,232,839 12 911,123 10 44,432 - 26,943 - 194,291 2 (38,206) - 1,260,804 13 1,488,264 15 2,399,387 25 261,972 3 2,137,415 22		2023
				Amount % $ 8,802,818 100 6,791,972 77 2,010,846 23 (9,266) - 9,767 - 2,011,347 23 235,954 3 218,275 3 642,718 7 (6) - 1,096,941 13 914,406 10 38,868 1 26,055 - 11,296 - (37,349) - 984,206 11 1,023,076 12 1,937,482 22 223,780 2 1,713,702 20 (Continued)

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TXC CORPORATION

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME (LOSS) 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 joint ventures accounted for using the equity method Items that may be reclassified subsequently to profit or loss: Exchange differences on translation of the financial statements of foreign operations Share of the other comprehensive income (loss) of associates and joint ventures accounted for using the equity method Other comprehensive income (loss) for the year, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE YEAR EARNINGS PER SHARE (Note 24) From continuing operations Basic Diluted		2024 Amount % $ 16,307 - (74,943) (1) 87,901 1 29,265 - 424,239 5 17,936 - 442,175 5 471,440 5 $ 2,608,855 27 $ 6.55 $ 6.39		2023
				Amount % $ 3,030 - (45,086) - 20,521 - (21,535) - (127,850) (2) (4,333) - (132,183) (2) (153,718) (2) $ 1,559,984 18 $ 5.53 $ 5.33
		$		$

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

(Concluded)

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TXC CORPORATION

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars)

BALANCE AT JANUARY 1, 2023 Appropriation of 2022 earnings (Note 19) Legal reserve 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 Convertible bond converted to ordinary shares Donations from shareholders Changes in capital surplus from investment in associates and joint ventures accounted for using the equity method BALANCE AT DECEMBER 31, 2023 Appropriation of 2023 earnings (Note 19) Legal reserve Special reserve Cash dividends distributed by the Company Net profit for the year ended December 31, 2024 Other comprehensive income (loss) for the year ended December 31, 2024, net of income tax Total comprehensive income (loss) for the year ended December 31, 2024 Convertible bond converted to ordinary shares Donations from shareholders Issuance of ordinary shares for cash BALANCE AT DECEMBER 31, 2024			Equity Attributable to Owners of the Company	Equity Attributable to Owners of the Company	Equity Attributable to Owners of the Company	Others Exchange Differences on Translating the Unrealized Gain (Loss) on Financial Assets at Fair Value Financial Through Other Statements of Foreign Operations Comprehensive Income $ (450,523 ) $ 307,453 - - - - - - - - (132,183) (24,704) (132,183) (24,704) - (227,810 ) - - - - - - (582,706 ) 54,939 - - - - - - - - 442,175 12,732 442,175 12,732 - - - - - - $ (140,531) $ 67,671	Total Equity $ 12,473,208 - - (2,168,299 ) 1,713,702 (153,718) 1,559,984 - 100 269 8,354 11,873,616 - - (1,393,911 ) 2,137,415 471,440 2,608,855 898,442 (147 ) 2,337,500 $ 16,324,355
		Shares (In Thousands) 309,757 - - - - - - - 1 - - 309,758 - - - - - - 8,235 - 25,000 342,993	Share Capital Bond Conversion Ordinary Share Entitlement Certificates Capital Surplus $ 3,097,570 $ - $ 1,709,979 - - - - - - - - - - - - - - - - - - - - - - 9 91 - - 269 - - 8,354 3,097,570 9 1,718,693 - - - - - - - - - - - - - - - - - - 82,360 (9 ) 816,091 - - (147 ) 250,000 - 2,087,500 $ 3,429,930 $ - $ 4,622,137		Retained Earnings Legal Reserve Special Reserve Unappropriated Earnings $ 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 5,198,793 194,468 - (194,468 ) - 384,696 (384,696 ) - - (1,393,911 ) - - 2,137,415 - - 16,533 - - 2,153,948 - - - - - - - - - $ 2,437,715 $ 527,767 $ 5,379,666

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

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TXC CORPORATION

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (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 on trade receivables Net (profit) loss on fair value changes 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 Write-down of inventories Unrealized gain on the transactions with subsidiaries, associates and joint ventures Realized gain on the transactions with subsidiaries, associates and joint ventures 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 Trade payables Trade payables to related parties Other payables Other payables to related parties Other current liabilities Net defined benefit liabilities Cash generated from operations Interest paid Income taxes 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 at fair value through profit or loss	2024 $ 2,399,387 510,508 10,821 - (5,103) 38,206 (44,432) (4,651) (1,260,804) (2,200) 8,644 14,091 (9,266) - - (155,062) (131,723) (33,761) 6,742 (46,228) (114,151) 39,180 25,173 67,308 14,983 41,297 (4,948) 1,364,011 (32,737) (165,853) 1,165,421 (75,185) -	2023 $ 1,937,482 504,459 12,386 (6) 11,779 37,349 (38,868) (12,561) (984,206) (1,091) 13,573 9,266 (9,767) (7) 541 428,658 (5,990) (7,801) (7,458) (8,438) (5,114) 76,082 143,381 (239,169) 505 9,669 (11,310) 1,853,344 (26,101) (541,295) 1,285,948 - 13,274 (Continued)

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TXC CORPORATION

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (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 Payments for property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in refundable deposits Payments for intangible assets Increase in prepayment for equipment Interest received Dividend received from associates Other dividends received Net cash (used in) generated from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Repayments of bonds payable Proceeds from long-term borrowings Repayments of long-term borrowings Proceeds from guarantee deposits received Repayments of principle portion of lease liabilities Dividends paid to owners of the company Proceeds from issuance of ordinary shares 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 INCREASE (DECREASE) 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	2024 $ - - - 1,372 (409,048) 6,128 (1,006) (6,358) (153,282) 44,266 402,840 22,215 (168,058) (301,400) 3,000,000 (4,336,088) 29,734 (4,418) (1,393,911) 2,337,500 (147) (668,730) (4,704) 323,929 1,972,837 $ 2,296,766	2023 $ (40,435) 299,306 (23,083) - (197,244) 4,393 - (8,184) (175,441) 38,507 390,150 32,686 333,929 - 1,500,000 (1,350,753) - (3,243) (2,168,299) - 269 (2,022,026) (47) (402,196) 2,375,033 $ 1,972,837

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

(Concluded)

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NOTES TO PARENT COMPANY ONLY FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

TXC CORPORATION

1. ORGANIZATION AND OPERATIONS

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 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 on 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 addresses climate change by implementing renewable energy initiatives, pursuing a dual approach of procuring external renewable energy and independently establishing solar power systems. Committed to energy conservation and emissions reduction, the Company has established the ISO 50001 energy management system, completed ISO 14067 product carbon footprint assessments, and conducted ISO 14064-1 organizational greenhouse gas inventories across the entire group. Additionally, an energy management and monitoring information platform has been introduced to systematically oversee energy data and proactively develop countermeasures. Through multiple efficient channels, the Company continues to advance energy conservation and emissions reduction efforts, earning recognition with the prestigious “ESG Sustainability Leadership Award” from BSI in 2024.

2. APPROVAL OF FINANCIAL STATEMENTS

The parent company only financial statements were approved by the Company’s board of directors on March 10, 2025.

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3. APPLICATION OF NEW, AMENDED 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 Company’s accounting policies.

• b. The IFRS Accounting Standards endorsed by the FSC for application starting from 2025.

New, Amended Revised Standards and Interpretations Amendments to IAS 21 “Lack of Exchangeability” Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments” - the amendments to the application guidance of classification of financial assets	Effective Date **Announced by IASB **
	January 1, 2025 (Note 1) January 1, 2026 (Note 2)

• Note 1: An entity shall apply those amendments for annual reporting periods beginning on or after January 1, 2025. Upon initial application of the amendments to IAS 21, the Group shall not restate the comparative information and shall recognize any effect of initially applying the amendments as an adjustment to the opening balance of retained earnings or, if applicable, to the cumulative amount of translation differences in equity as well as affected assets or liabilities.

• Note 2: An entity shall apply those amendments for annual reporting periods beginning on or after January 1, 2026. It is permitted to apply these amendments for an earlier period beginning on January 1, 2025. An entity shall apply the amendments retrospectively but is not required to restate prior periods. The effect of initially applying the amendments shall be recognized as an adjustment to the opening balance at the date of initial application. An entity may restate prior periods if, and only if, it is possible to do so without the use of hindsight.

1) 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 Company 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.

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• 2) Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments” - the amendments to the application guidance of classification of financial assets

The amendments mainly amend the requirements for the classification of financial assets, including:

• a) if a financial asset contains a contingent feature that could change the timing or amount of contractual cash flows and the contingent event itself does not relate directly to changes in basic lending risks and costs (e.g., whether the debtor achieves a contractually specified reduction in carbon emissions), the financial asset has contractual cash flows that are solely payments of principal and interest on the principal amount outstanding if, and only if,

  • In all possible scenarios (before and after the occurrence of a contingent event), the contractual cash flows are solely payments of principal and interest on the principal amount outstanding; and

  • In all possible scenarios, the contractual cash flows would not be significantly different from the contractual cash flows on a financial instrument with identical contractual terms, but without such a contingent feature.

• b) to clarify that a financial asset has non-recourse features if an entity’s ultimate right to receive cash flows is contractually limited to the cash flows generated by specified assets.

• c) to clarify that the characteristics of contractually linked instruments include a prioritization of payments to the holders of financial assets using multiple contractually linked instruments (tranches) established through a waterfall payment structure, resulting in concentrations of credit risk and a disproportionate allocation of cash shortfalls from the underlying pool between the tranches.

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

New, Amended and Revised Standards and Interpretations Annual Improvements to IFRS Accounting Standards - Volume 11 Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments” - the amendments to the application guidance of derecognition of financial liabilities Amendments to IFRS 9 and IFRS 7 “Contracts Referencing Nature- dependent Electricity” Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” Amendments to IFRS 17 Amendments to IFRS 17 “Initial Application of IFRS 17 and IFRS 9 - Comparative Information” IFRS 18 “Presentation and Disclosure in Financial Statements” IFRS 19 “Subsidiaries without Public Accountability: Disclosures”

Effective Date Announced by IASB (Note)

January 1, 2026 January 1, 2026 January 1, 2026 To be determined by IASB January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2027 January 1, 2027

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

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• 1) IFRS 18 “Presentation and Disclosure in Financial Statements”

IFRS 18 will supersede IAS 1 “Presentation of Financial Statements”. The main changes comprise:

• Items of income and expenses included in the statement of profit or loss shall be classified into the operating, investing, financing, income taxes and discontinued operations categories.

• The statement of profit or loss shall present totals and subtotals for operating profit or loss, profit or loss before financing and income taxes and profit or loss.

• Provides guidance to enhance the requirements of aggregation and disaggregation: The Company shall identify the assets, liabilities, equity, income, expenses and cash flows that arise from individual transactions or other events and shall classify and aggregate them into groups based on shared characteristics, so as to result in the presentation in the primary financial statements of line items that have at least one similar characteristic. The Company shall disaggregate items with dissimilar characteristics in the primary financial statements and in the notes. The Company labels items as “other” only if it cannot find a more informative label.

• Disclosures on Management-defined Performance Measures (MPMs): When in public communications outside financial statements and communicating to users of financial statements management’s view of an aspect of the financial performance of the Company as a whole, the Company shall disclose related information about its MPMs in a single note to the financial statements, including the description of such measures, calculations, reconciliations to the subtotal or total specified by IFRS Accounting Standards and the income tax and non-controlling interests effects of related reconciliation items.

• 2) Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments” - the amendments to the application guidance of derecognition of financial liabilities

The amendments mainly stipulate that, when settling a financial liability in cash using an electronic payment system, the Company can choose to derecognize the financial liability before the settlement date if, and only if, the Company has initiated a payment instruction that resulted in:

• The Company having no practical ability to withdraw, stop or cancel the payment instruction;

• The Company having no practical ability to access the cash to be used for settlement as a result of the payment instruction; and

• The settlement risk associated with the electronic payment system being insignificant.

The Company shall apply the amendments retrospectively but is not required to restate prior periods. The effect of initially applying the amendments shall be recognized as an adjustment to the opening balance at the date of initial application.

Except for the above impact, as of the date the parent company only financial statements were authorized for issue, the Company is continuously assessing the possible impact of the above amended standards and interpretations on the Company’s financial position and financial performance and will disclose the relevant impact when the assessment is completed.

• 14 -

4. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION

• a. Statement of compliance

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

• b. Basis of preparation

The parent company only 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;

• 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.

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

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

Current assets include:

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

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

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

Current liabilities include:

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

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

• 3) Liabilities for which the Company does not have the substantial right at the end of the reporting period to defer settlement for at least 12 months after the reporting period.

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

• 15 -

d. Foreign currencies

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

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

Non-monetary items denominated in foreign currencies that are measured at fair value 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 item denominated in a foreign currency and measured at historical cost is stated at the reporting currency as originally translated from the foreign currency.

For the purpose of presenting parent company only financial statements, the financial statements of the Company’s foreign operations (including subsidiaries, associates, joint ventures and branches in other countries) that are prepared using functional 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 (attributed to the owners of the Company and non-controlling interests as appropriate).

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 attributable to the owners of the Company are reclassified to profit or loss.

In 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 included in the calculation of equity transactions 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.

e. 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. The net realizable value is the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. Inventories are recorded at the specific identification of cost on the balance sheet date.

f. Investments in subsidiaries

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

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

• 16 -

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

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

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

Any excess of the cost of acquisition over the Company’s share of the net fair value of the identifiable assets and liabilities of a subsidiary that constitutes a business 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 Company’s share of the net fair value of the identifiable assets and liabilities of a subsidiary that constitutes a business over the cost of acquisition is recognized immediately in profit or loss.

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

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

Profit or loss resulting from downstream transactions is eliminated in full only in the parent company only financial statements. Profit and loss resulting from upstream transactions and transactions between subsidiaries is recognized only in the parent company only financial statements and only to the extent of interests in the subsidiaries that are not related to the Company.

• g. Investments in associates

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

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

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

• 17 -

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

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

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

The Company discontinues the use of the equity method from the date on which its investment ceases to be an associate. 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 attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate. The Company accounts for all amounts previously recognized in other comprehensive income in relation to that associate on the same basis as would be required had that associate 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 Company continues to apply the equity method and does not remeasure the retained interest.

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

• h. Property, plant and equipment

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

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

• 18 -

Expect for freehold land which is not depreciated, the depreciation of property, plant and equipment is recognized using the straight-line method. Each significant part is depreciated separately. The estimated useful lives, residual values and depreciation methods are reviewed at the end of each reporting period, with the effects of any changes in the estimates accounted for on a prospective basis.

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

• i. Investment properties

Investment properties are properties held to earn rental and/or for capital appreciation.

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.

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

• j. Intangible assets

• 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 lives, residual values, and amortization methods are reviewed at the end of each reporting period, with the effect of any changes in the 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 and intangible assets other than goodwill

At the end of each reporting period, the Company reviews the carrying amounts of its property, plant and equipment, right-of-use asset, investment properties 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 Company 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 and whenever there is an indication that the assets may be impaired.

• 19 -

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

• l. Financial instruments

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

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

• 1) Financial assets

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

• a) Measurement categories

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

• i. Financial assets at FVTPL

Financial assets are classified as at FVTPL when such financial assets are 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, and any dividends or interest earned on such financial assets are recognized in other income and interest income, respectively; any remeasurement gains or losses on such financial assets are recognized in other gains or losses. Fair value is determined in the manner described in Note 26.

• ii. Financial assets at amortized cost

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

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

• 20 -

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, note and trade receivables at amortized cost, other receivables, and refundable deposits, are measured at amortized cost, which equals the gross carrying amount using 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 Company may make an irrevocable election to designate investments in equity instruments as at FVTOCI. Designation as at FVTOCI is not permitted if the equity investment is held for trading or if it is contingent consideration recognized by an acquirer in a business combination.

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

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

• b) Impairment of financial assets

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

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

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

• 21 -

• c) Derecognition of financial assets

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

On derecognition of a financial asset at amortized cost in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss. On derecognition of an investment in 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.

On derecognition of a financial asset other than in its entirety, the Company 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

Financial liabilities are classified as at FVTPL when such financial liabilities are held for trading.

Financial liabilities held for trading are stated at fair value, and any remeasurement gains or losses on such financial liabilities are recognized in other gains or losses. Fair value is determined in the manner described in Note 26.

• b) Derecognition of financial liabilities

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

• 3) Derivative financial instruments

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

• 22 -

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 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 Company 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. Leases

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

1) The Company as lessor

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

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

• 2) The Company as lessee

The Company recognizes right-of-use assets and lease liabilities for all leases at the commencement date of a lease, except for short-term leases and low-value asset leases accounted for by 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. Rightof-use assets are presented on a separate line in the parent company only balance sheets.

• 23 -

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 lessee’s incremental borrowing rate will be used.

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 Company 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 parent company only balance sheets.

o. Borrowing costs

Borrowing costs directly attributable to an 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 those 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 related to income are not recognized until there is reasonable assurance that the Company will comply with the conditions attached to them and that the grants will be received.

Government grants related to income are recognized as a reduction of the related costs and other income on a systematic basis over the periods in which the Company recognizes as expenses the related costs that the grants intend to compensate. Specifically, government grants whose primary condition is that the Company 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 Company 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 expenses when employees have rendered services entitling them to the contributions.

• 24 -

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, past service cost, as well as gains and losses on settlements) and net interest on the net defined benefit liabilities (assets) are recognized as employee benefits expense in the period in which they occur or when the settlement 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 liabilities (assets) represent the actual deficit (surplus) in the Company’s defined benefit plans. 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.

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

• 25 -

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

• 3) Current and deferred tax for the year

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

Where current tax or deferred tax arises from the initial accounting for a business combination and the acquisition of a subsidiary, the tax effect is included in the accounting for the business combination and investments in a subsidiary.

5. MATERIAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Company’s accounting policies, management is required to make judgments, estimations, and assumptions on 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.

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
		2024 $ 479 1,217,903 978,384 100,000 $ 2,296,766	2023 $ 640 1,272,197 - 700,000 $ 1,972,837

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 **
	2024 2023 0.001%-3.76% 0.001%-3.5% 1.5%-4.61% - 1.47% 1.16%-1.26%

• 26 -

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 () Non-derivative financial assets Domestic listed shares Hybrid financial assets Convertible bonds Financial liabilities at FVTPL-current Financial liabilities mandatorily classified as at FVTPL Derivative financial instruments (not under hedge accounting) Foreign exchange forward contracts and exchange contracts ()		December	31
		2024 $ 1,415 43,000 17,550 60,550 $ 61,965 $ -	2023 $ - - - - $ - $ 18,323

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

			Contract Amount
	Currency	Maturity Date	(In Thousands)
December 31, 2024
Knock-out forward	USD/RMB	2025.01.13	USD4,000/RMB29,030
Exchange contracts	USD/NTD	2025.01.21-2025.02.04	USD7,000/NTD222,583
Foreign exchange currency	USD/NTD	2025.01.03-2025.02.05	USD7,000/NTD225,900
options
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

The Company entered into foreign exchange forward contracts and exchange contracts during the years ended December 31, 2024 and 2023 to manage exposures 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.

• 27 -

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Non-current Domestic investments Listed shares Win Win Precision Technology Co., Ltd. Emerging market shares Win Win Precision Technology Co., Ltd. Unlisted shares Foreign investments Unlisted shares		December 31	December 31
		2024 $ 40,678 - 49,292 6,422 $ 96,392	2023 $ - 72,844 68,056 30,435 $ 171,335

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

On May 9, 2024 and January 16, 2023, Win Win Precision Technology Co., Ltd.’s shares were listed on the Taiwan Stock Exchange (TWSE) and Taipei Exchange (OTC), respectively. The transfer of fair value measurement level referred to Note 26.

In 2023, the Company 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 its related unrealized gain of $227,810 thousand was transferred from other equity to retained earnings.

9. FINANCIAL ASSETS AT AMORTIZED COST

Current Domestic investments Pledge deposits		December	31
		2024 $ 78,674	2023 $ 75,342

Refer to Note 28 for information relating to investments in financial assets at amortized cost pledged as security.

• 28 -

10. NOTES, ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES

Trade receivables At amortized cost Gross carrying amount Less: Allowance for impairment loss Other receivables Tax refund receivable Others		December 31	December 31
		2024 $ 3,064,469 (9,371) $ 3,055,098 $ 29,846 30,462 $ 60,308	2023 $ 2,778,366 (10,053) $ 2,768,313 $ 25,166 1,175 $ 26,341

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 Company reviews the recoverable amount of each individual trade debt at the end of the reporting period to ensure that adequate allowance is made for possible irrecoverable amounts. In this regard, the management believes the Company’s credit risk was significantly reduced.

The Company 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 Company’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 Company’s different customer base. The Company recognizes 100% loss allowance for trade receivables of greater than 120 days past due and unsecured.

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

The following table details the loss allowance of trade receivables based on the Company’s provision matrix:

December 31, 2024

Not Past Due 1 to 60 Days Expected credit loss rate 0.32% 0.02%-0.66% Gross carrying amount $ 2,893,421 $ 171,048 Loss allowance (Lifetime ECL) (9,324) (47) Amortized cost $ 2,884,097 $ 171,001	61 to 120 Days 100% $ - - $ -	121 to 180 Days 100% $ - - $ -	Over 180 Days 100% $ - - $ -	Total $ 3,064,469 (9,371) $ 3,055,098

December 31, 2023

• 29 -

Not Past Due 1 to 60 Days 61 to 120 Days Expected credit loss rate 0.38% 0.02%-0.06% 0.65%-0.98% Gross carrying amount $ 2,665,357 $ 112,926 $ 83 Loss allowance (Lifetime ECL) (10,030) (22) (1) Amortized cost $ 2,655,327 $ 112,904 $ 82	121 to 180 Days 100% $ - - $ -	Over 180 Days 100% $ - - $ -	Total $ 2,778,366 (10,053) $ 2,768,313

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

Balance at January 1 Less: Impairment losses reversed Less: Amounts written off Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2024 $ 10,053 - (682) $ 9,371	2023 $ 10,059 (6) - $ 10,053

11. INVENTORIES

Finished goods Work in process Raw materials Supplies and spare parts Merchandise Inventory in transit		December 31	December 31
		2024 $ 269,942 391,022 324,394 112,410 394,739 11,146 $ 1,503,653	2023 $ 240,845 272,310 337,617 118,584 475,460 21,253 $ 1,466,069

The cost of inventories recognized as cost of goods sold for the years ended December 31, 2024 and 2023 was $7,672,257 thousand and $6,791,972 thousand, respectively. The cost of goods sold for the 2024 and 2023 included inventory write-downs of $8,644 thousand and $13,573 thousand, respectively.

12. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Investments in subsidiaries Investments in associates		**December 31 **	**December 31 **
		2024 $ 9,158,579 428,728 $ 9,587,307	2023 $ 7,823,744 397,952 $ 8,221,696

• 30 -

Investments in Subsidiaries

Unlisted companies Taiwan Crystal Technology International Limited TXC Technology Inc. TXC Japan Corporation Taiwan Crystal Technology (HK) Limited TXC Europe GmbH		December 31	December 31
		2024 $ 8,879,763 24,078 31,865 209,731 13,142 $ 9,158,579	2023 $ 7,563,696 23,290 32,358 193,100 11,300 $ 7,823,744

The proportion of the Company’s ownership was as follows:

Unlisted shares Taiwan Crystal Technology International Ltd. TXC Technology Inc. TXC Japan Corporation Taiwan Crystal Technology (HK) Limited TXC Europe GmbH Investments in Associates Associate that is not individually material The Company’s share of: Profit from continuing operations Other comprehensive income (loss) Total comprehensive income for the year		**December 31 **	**December 31 **
		2024 2023 100 100 100 100 100 100 100 100 100 100 December 31
	2024 $ 428,728 For the Year Ended		2023 $ 397,952 December 31
		2024 $ 30,280 18,101 $ 48,381	2023 $ 20,756 (4,266) $ 16,490

Investments in Associates

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.

• 31 -

13. PROPERTY, PLANT AND EQUIPMENT

Cost Balance at January 1, 2023 Additions Disposals Reclassified Balance at December 31, 2023 Accumulated depreciation and impairment Balance at January 1, 2023 Disposals Depreciation expenses Balance at December 31, 2023 Carrying value at December 31, 2023 Cost Balance at January 1, 2024 Additions Disposals Balance at December 31, 2024 Accumulated depreciation and impairment Balance at January 1, 2024 Disposals Depreciation expenses Balance at December 31, 2024 Carrying value at December 31, 2024	Freehold Land Land Improvements $ 621,855 $ 3,024 - - - - - - $ 621,855 $ 3,024 $ - $ 1,582 - - - 317 $ - $ 1,899 $ 621,855 $ 1,125 $ 621,855 $ 3,024 - - - - $ 621,855 $ 3,024 $ - $ 1,899 - - - 312 $ - $ 2,211 $ 621,855 $ 813	Buildings $ 1,592,165 42,677 (2,033 ) - $ 1,632,809 $ 742,923 (2,033 ) 65,420 $ 806,310 $ 826,499 $ 1,632,809 117,545 (3,684) $ 1,746,670 $ 806,310 (3,684 ) 67,755 $ 870,381 $ 876,289	Machinery and Equipment $ 4,644,182 152,398 (78,687 ) (3,200) $ 4,714,693 $ 3,258,095 (75,385 ) 421,916 $ 3,604,626 $ 1,110,067 $ 4,714,693 253,235 (156,138) $ 4,811,790 $ 3,604,626 (152,210 ) 425,514 $ 3,877,930 $ 933,860	Trans- portation Equipment $ 1,534 866 (790 ) - $ 1,610 $ 1,459 (790 ) 89 $ 758 $ 852 $ 1,610 - - $ 1,610 $ 758 - 173 $ 931 $ 679	Office Equipment $ 123,001 1,303 (1,930 ) - $ 122,374 $ 90,397 (1,930 ) 12,116 $ 100,583 $ 21,791 $ 122,374 38,268 (4,114) $ 156,528 $ 100,583 (4,114 ) 11,006 $ 107,475 $ 49,053	Total $ 6,985,761 197,244 (83,440 ) (3,200) $ 7,096,365 $ 4,094,456 (80,138 ) 499,858 $ 4,514,176 $ 2,582,189 $ 7,096,365 409,048 (163,936) $ 7,341,477 $ 4,514,176 (160,008 ) 504,760 $ 4,858,928 $ 2,482,549

There was no impairment assessment was performed for the years ended December 31, 2024 and 2023 as there was no indication of impairment.

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	3-51 years
Equipment
Major production equipments	2-15 years
Temperature control systems	4-7 years
Transportation equipments	4-7 years
Transportation equipments	5 years
Office equipments	2-8 years

• 32 -

14. LEASE ARRANGEMENTS

• a. Right-of-use assets

Carrying amounts Buildings Transportation equipment Additions to right-of-use assets Depreciation charge for right-of-use assets Buildings Transportation equipment		**December **	**31 **
	2024 2023 $ 6,430 $ 1,309 4,872 2,558 $ 11,302 $ 3,867 For the Year Ended December 31
		2024 $ 11,923 $ 2,595 1,894 $ 4,489	2023 $ 2,878 $ 2,618 619 $ 3,237

b. Lease liabilities

Carrying amounts Current Non-current		December	31
		2024 $ 4,896 6,511 $ 11,407	2023 $ 2,270 1,631 $ 3,901

Range of discount rates for lease liabilities was as follows:

Buildings Transportation equipment	December 31
	2024 2023 2.49% 1.27% 3.00%-3.14% 3.00%

• c. Material leasing activities and terms

The Company leases certain warehouses in economic zone with lease term of 3 years, and leases car for business use with lease term of 3 years. The Company does not have a bargain purchase option to acquire the leased warehouse at the expire of the lease period.

• 33 -

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
		2024 $ 366 $ (4,784)	2023 $ 249 $ (3,492)

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

15. INVESTMENT PROPERTIES

	Completed
	Investment
	Properties
Cost
Balance at January 1, 2023	$ 28,577
Additions	-
Disposals	-
Balance at December 31, 2023	$ 28,577
Accumulated depreciation and impairment
Balance at January 1, 2023	$ (9,988)
Disposals	-
Depreciation expenses	(1,364)
Balance at December 31, 2023	$ (11,352)
Carrying amounts at December 31, 2023	$ 17,225
Cost
Balance at January 1, 2024	$ 28,577
Additions	-
Disposals	-
Balance at December 31, 2024	$ 28,577
Accumulated depreciation and impairment
Balance at January 1, 2024	$ (11,352)
Disposals	-
Depreciation expenses	(1,259)
Balance at December 31, 2024	$ (12,611)
Carrying amounts at December 31, 2024	$ 15,966

• 34 -

The investment properties are depreciated using the straight-line method over their estimated useful lives of 3-51 years.

The fair value of the Company’s investment properties as of December 31, 2024 and 2023 was $88,212 thousand and $57,577 thousand, respectively. The determination of fair value valuation had not been performed by independent qualified professional valuers; however, the management of the Company had 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 Company’s investment properties were freehold properties.

16. BORROWINGS

Long-term Borrowings

Unsecured borrowings Line of credit borrowings Less: Current portions Long-term borrowings Detail of borrowings Annual interest rate Maturity date		**December 31 **
	2024 2023 $ 952,666 $ 2,288,754 (419,333) (636,087) $ 533,333 $ 1,652,667 0.98%-1.79% 0.85%-1.55% Due by August 2026 Due by August 2026

17. 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
		2024 $ - - - - $ -	2023 $ 1,199,900 (6,080) 1,193,820 (1,193,820) $ -

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 regulations on issuance and conversion of bonds, the conversion price should be adjusted to $109.1 per share since June 28, 2024, i.e. the ex-dividend date.

• 35 -

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, 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 Liability component at December 31, 2023 Interest charged at an effective interest rate Convertible bonds converted into ordinary shares Redemption of convertible bonds Liability component at December 31, 2024

$ 1,194,573 (28,431) 2,040 $ 1,168,182 $ 1,183,273 10,647 (100) 1,193,820 (1,193,820) $ - $ 1,193,820 6,022 (898,442) (301,400) $ -

18. OTHER LIABILITIES

Current Other payables Payables for bonuses to employees and directors Payables for commissions Payables for salaries Payables for bonuses Payables for annual leave Payables for purchases of equipment Others		December 31	December 31
		2024 $ 281,492 20,655 43,106 190,227 31,146 31,598 94,124 $ 692,348	2023 $ 276,024 17,840 43,755 154,912 31,076 32,159 69,827 $ 625,593

19. 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, the Company makes monthly contributions to employees’ individual pension accounts at 6% of monthly salaries and wages.

• 36 -

The Company has set up appointed manager’s pension fund and contributes monthly an amount of not less than 8% of the appointed manager’s monthly salaries and wages to the Bank of Taiwan.

b. Defined benefit plans

The defined benefit plans adopted by the Company in accordance with the Labor Standards Act is operated by the government of the ROC. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the 6 months before retirement. The Company contributes 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 Company 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 Company 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 Company has no right to influence the investment policy and strategy.

The amounts included in the parent company only balance sheets in respect of the Company’s defined benefit plans are as follows:

Present value of defined benefit obligation Fair value of plan assets Net defined benefit (assets) liabilities		December 31	December 31
		2024 $ 73,551 (78,778) $ (5,227)	2023 $ 176,155 (156,050) $ 20,105

Movements in net defined benefit liabilities (assets) were as follows:

	Present Value		Net Defined	Net Defined
	of the Defined			Benefit
	Benefit	Fair Value of	Liabilities
	Obligation	the Plan Assets		(Assets)
Balance at January 1, 2023	$ 182,628	$ (147,425)	$	35,203
Service cost
Current service cost	945	-		945
Prior service cost	465	-		465
Past service cost and 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)
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

(Continued)

• 37 -

	Present Value	Present Value			Net Defined	Net Defined
	of the Defined					Benefit
		Benefit	Fair Value of		Liabilities
	Obligation		the Plan Assets			(Assets)
Service cost
Current service cost	$	791	$	-	$	791
Past service cost		2,005		-		2,005
Past service cost and loss (gain) on
settlements		(996)		700		(296)
Net interest expense (income)		2,088		(2,077)		11
Recognized in profit or loss		3,888		(1,377)		2,511
Remeasurement
Return on plan assets (excluding amounts
included in net interest)		-		(12,908)		(12,908)
Actuarial (gain) loss - changes in financial
assumptions		(6,261)		-		(6,261)
Actuarial (gain) loss - experience
adjustments		(1,214)		-		(1,214)
Recognized in other comprehensive income		(7,475)		(12,908)		(20,383)
Contributions from the employer		-		(7,460)		(7,460)
Benefits paid		(99,017)		99,017		-
Balance at December 31, 2024	$	73,551	$	(78,778)	$	(5,227)

(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
		2024 $ 1,344 219 355 593 $ 2,511	2023 $ 960 135 272 455 $ 1,822

Through the defined benefit plans under the Labor Standards Act, the Company 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 and 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 plans’ debt investments.

• 3) Salary risk: The present value of the defined benefit obligation is calculated using the future salaries of plan participants. As such, an increase in the salaries of the plan participants will increase the present value of the defined benefit obligation.

• 38 -

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
	2024 2023 1.50% 1.25% 2.50% 2.50%

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 would increase (decrease) 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 **
		2024 $ (1,411) $ 1,455 $ 1,418 $ (1,382)	2023 $ (4,090) $ 4,237 $ 4,110 $ (3,989)

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

Expected contributions to the plans for the next year Average duration of the defined benefit obligation		December	31
		2024 $ 2,052 9.1 years	2023 $ 13,440 9.8 years

20. EQUITY

• a. Share capital

Ordinary shares

Shares authorized (in thousands of shares) Shares authorized, par value $10 (in thousands of dollars) Shares issued and fully paid (in thousands of shares) Shares issued and fully paid (in thousands of dollars)		**December 31 **	**December 31 **
		2024 500,000 $ 5,000,000 342,993 $ 3,429,930	2023 500,000 $ 5,000,000 309,757 $ 3,097,570

• 39 -

In order to align with long-term operational development, the Company introduced strategic partners, strengthened operational capital, and enhanced its financial structure. Considering the cost of raising funds and the timeliness and convenience of the introduction, the shareholders’ meeting held on May 28, 2024, approved a private placement of up to 25,000 thousand shares of common stock through a cash capital increase. On June 20, 2024, the Board of Directors approved the issuance of 25,000 thousand common shares through a cash capital increase, with all shares to be subscribed for in cash by specific individuals, at a premium price of $93.5 per share. The total amount raised through the private placement was $2,337,500 thousand. The capital increase was registered and completed with the effective date set as July 2, 2024.

Bond conversion entitlement certificates

Shares converted but the registration change has not been completed (in thousands of shares) Shares converted but the registration change has not been completed (in thousands of dollars)		December	31
		2024 - $ -	2023 1 $ 9

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.

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
		2024 $ 2,699,275 1,814,500 80,518 331 23,981 3,532 - $ 4,622,137	2023 $ 611,776 977,121 73,377 331 23,981 3,678 28,429 $ 1,718,693

• 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).

• 40 -

c. Retained earnings and dividend policy

Under the dividends policy as set forth in the amended Articles, where the Company made a 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, and then any remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan, which should be resolved in the shareholders’ meeting for the distribution of dividends and bonuses to shareholders. For the policies on distribution of employees’ compensation and remuneration of directors and supervisors after the amendment, refer to compensation of employees and remuneration of directors and supervisors in Note 22(g).

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

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

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 2023 and 2022, which were approved by the shareholders’ meetings on May 28, 2024 and May 30, 2023, respectively, were as follows:

Legal reserve Special reserve Cash dividends	Appropriation of Earnings For Fiscal For Fiscal Year 2023 Year 2022 $ 194,468 $ 296,435 384,696 143,071 1,393,911 2,168,299	Dividends Per Share (NT$)
		For Fiscal For Fiscal Year 2023 Year 2022 $ - $ - - - 4.5 7

The appropriations of earnings for 2024, which were proposed by the board of directors on March 10, 2025, were as follows:

			Dividends	Dividends
	Appropriation		Per	Share
	of	Earnings	(NT$)
Legal reserve	$	215,395	$	-
Special reserve		(304,974)		-
Cash dividends		1,783,563		5.2

• 41 -

The appropriation of earnings for 2024 will be resolved by the shareholders in their meeting to be held on May 27, 2025.

d. Others equity items

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

Balance at January 1 Exchange differences on the translation of financial statements of foreign operations Share from associates accounted for using the equity method Balance at December 31	For the Year Ended	For the Year Ended	December 31
		2024 $ (582,706) 424,239 17,936 $ (140,531)	2023 $ (450,523) (127,850) (4,333) $ (582,706)

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

Balance at January 1 Recognized for the year Unrealized loss - equity instruments Share from associates accounted for using the equity method Other comprehensive income (loss) recognized for the year Cumulative unrealized gain of equity instruments transferred to retained earnings due to disposal Balance at December 31	For the Year Ended	For the Year Ended	December 31
		2024 $ 54,939 (74,943) 87,675 12,732 - $ 67,671	2023 $ 307,453 (45,086) 20,382 (24,704) (227,810) $ 54,939

21. REVENUE

Revenue from contracts with customers Revenue from sale of goods Contract Balances December 31, 2024 Trade receivables (Note 10) $ 3,055,098	For the Year Ended December 31	For the Year Ended December 31
	2024 $ 9,821,044 December 31, 2023 $ 2,768,313	2023 $ 8,802,818 January 1, 2023 $ 3,190,981

• 42 -

22. NET PROFIT FROM CONTINUING OPERATIONS

Net profit from continuing operations attributable to:

a. Interest income

Bank deposits Financial assets at amortized cost Others b. Other income Rental income Dividends Income from government grants Others c. Other gains and losses 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 Depreciation of investment properties Gain on modifications of lease Others	**For the Year Ended **	**For the Year Ended **	**December 31 **
	2024 $ 34,072 725 9,635 $ 44,432 For the Year Ended		2023 $ 28,369 2,440 8,059 $ 38,868 December 31
	2024 $ 6,079 4,651 10,944 5,269 $ 26,943 For the Year Ended		2023 $ 6,145 12,561 3,256 4,093 $ 26,055 December 31
		2024 $ 2,200 5,103 188,689 (1,259) - (442) $ 194,291	2023 $ 1,091 (11,779) 28,760 (1,364) 7 (5,419) $ 11,296

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
		2024 $ 31,955 6,022 229 $ 38,206	2023 $ 26,640 10,647 62 $ 37,349

• 43 -

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 Non-operating expenses An analysis of amortization by function Operating costs Operating expenses	For the Year Ended	For the Year Ended	December 31
		2024 $ 504,760 1,259 4,489 10,821 $ 521,329 $ 295,462 213,787 1,259 $ 510,508 $ 47 10,774 $ 10,821	2023 $ 499,858 1,364 3,237 12,386 $ 516,845 $ 296,474 206,621 1,364 $ 504,459 $ 47 12,339 $ 12,386

f. Employee benefits expense

Post-employment benefits Defined contribution plans Defined benefit plans (Note 19) Other employee benefits Payroll expense Labor and health insurance Others Total employee benefits expense 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
		2024 $ 29,753 2,511 32,264 1,097,808 76,983 30,455 1,205,246 $ 1,237,510 $ 658,529 578,981 $ 1,237,510	2023 $ 31,464 1,822 33,286 971,280 83,335 31,234 1,085,849 $ 1,119,135 $ 621,691 497,444 $ 1,119,135

• 44 -

• g. Employees’ compensation and remuneration of directors for 2024 and 2023

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, 2024 and 2023 which were approved by the Company’s board of directors on March 10, 2025 and March 11, 2024, respectively, were as follows:

Accrual rate

Employees’ compensation Remuneration of directors Amount	For the Year Ended December 31
	2024 2023 9.0% 9.0% 1.5% 1.5%

Employees’ compensation Remuneration of directors	**For the Year Ended December 31 **	**For the Year Ended December 31 **
	2024 Cash Bonus Share Bonus $ 241,279 $ - 40,213 -	2023
		Cash Bonus Share Bonus $ 194,831 $ - 32,472 -

If there is a change in the amounts after the annual parent company only financial statements were 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 parent company only financial statements for the years ended December 31, 2023 and 2022.

Information on the employees’ compensation and remuneration of directors resolved by the Company’s board of directors in 2024 and 2023 is available at the Market Observation Post System website of the Taiwan Stock Exchange.

23. INCOME TAXES RELATING TO CONTINUING OPERATIONS

• a. Income tax recognized in profit or loss

Major components of income tax expense are 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 Income tax expense recognized in profit or loss	For the Year Ended	For the Year Ended	December 31
		2024 $ 225,552 - (15,022) 210,530 51,442 $ 261,972	2023 $ 229,394 6,418 (4,356) 231,456 (7,676) $ 223,780

• 45 -

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

b. c.	Profit before tax from continuing operations Income tax expense calculated at the statutory rate Nondeductible expenses in determining taxable income Income tax on unappropriated earnings Tax-exempt income Deferred tax effect on earnings of subsidiaries Investment tax credits Adjustment for prior years’ tax Income tax expense recognized in profit or loss Income tax expense recognized in other comprehensive income Deferred tax In respect of the current year Remeasurement of defined benefit plans Current income tax assets and liabilities Current tax assets Income tax refund receivable Current tax liabilities Income tax payable	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2024 2023 $ 2,399,387 $ 1,937,482 $ 479,877 $ 387,496 799 1,100 - 6,418 (254,252) (201,763) 101,530 76,005 (50,960) (41,120) (15,022) (4,356) $ 261,972 $ 223,780 For the Year Ended December 31
			2024 $ 4,077 December	2023 $ 757 31
			2024 $ 78,982 $ 49,629	2023 $ 74,030 $ -

• 46 -

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, 2024

Deferred tax assets Unrealized loss on inventories Unrealized exchange loss Payable for annual leave Determine benefit obligation Financial liabilities at fair value through profit or loss Others Deferred tax liabilities Associates Unrealized exchange profit Financial liabilities at fair value through profit or loss	Opening Balance Recognize in Profit or Loss Recognize in Other Compre- hensive Income $ 7,819 $ (1,003) $ - 16,235 (16,235) - 6,214 14 - 6,384 (990) (4,077) 4,950 (4,040) - 6,144 1,968 - $ 47,746 $ (20,286) $ (4,077) $ 77,493 $ 20,963 $ - - 9,910 - - 283 - $ 77,493 $ 31,156 $ -	Closing Balance $ 6,816 - 6,228 1,317 910 8,112 $ 23,383 $ 98,456 9,910 283 $ 108,649

For the year ended December 31, 2023

Deferred tax assets Unrealized loss on inventories Unrealized exchange loss Payable for annual leave Determine benefit obligation Financial liabilities at fair value through profit or loss Others Deferred tax liabilities Associates	Opening Balance Recognize in Profit or Loss Recognize in Other Compre- hensive Income $ 7,446 $ 373 $ - 11,336 4,899 - 6,189 25 - 9,403 (2,262) (757) 4,009 941 - 4,469 1,675 - $ 42,852 $ 5,651 $ (757) $ 79,518 $ (2,025) $ -	Closing Balance $ 7,819 16,235 6,214 6,384 4,950 6,144 $ 47,746 $ 77,493

• 47 -

e. Income tax assessments

The income tax returns through 2022 had been assessed by the tax authorities.

24. 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

Earnings used in the computation of basic earnings per share Interest on convertible bonds after tax Earnings used in the computation of diluted earnings per share Weighted average number of ordinary shares used 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
		2024 $ 2,137,415 4,817 $ 2,142,232 326,292 6,340 2,764 335,396	2023 $ 1,713,702 8,517 $ 1,722,219 309,757 10,563 2,634 322,954

The Company may settle the compensation of employees in cash or shares; therefore, the Company assumes that the entire amount of the compensation will be settled in shares and the resulting potential shares are included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

25. CAPITAL MANAGEMENT

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

The capital structure of the Company 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 Company is not subject to any externally imposed capital requirements.

• 48 -

26. FINANCIAL INSTRUMENTS

• a. 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 parent company only 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, 2024

Financial assets at FVTPL Domestic listed shares Foreign exchange forward contracts and exchange contracts Convertible bonds Financial assets at FVTOCI Investments in equity instruments Domestic listed shares Domestic unlisted shares Foreign unlisted shares December 31, 2023 Financial liabilities at FVTPL Foreign exchange forward contracts and exchange contracts Financial assets at FVTOCI Investments in equity instruments Domestic emerging market shares Domestic unlisted shares Foreign unlisted shares	Level 1 $ 43,000 - 17,550 $ 60,550 $ 40,678 - - $ 40,678 Level 1 $ - $ 72,844 - - $ 72,844	Level 2 $ - 1,415 - $ 1,415 $ - - - $ - Level 2 $ 18,323 $ - - - $ -	Level 3 $ - - - $ - $ - 49,292 6,422 $ 55,714 Level 3 $ - $ - 68,056 30,435 $ 98,491	Total $ 43,000 1,415 17,550 $ 61,965 $ 40,678 49,292 6,422 $ 96,392 Total $ 18,323 $ 72,844 68,056 30,435 $ 171,335

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

• 49 -

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

For the year ended December 31, 2024

Balance at January 1, 2024 Recognized in other comprehensive income (included in unrealized valuation gain (loss) on financial assets at FVTOCI) Balance at December 31, 2024 For the year ended December 31, 2023	Financial Assets at FVTPL Equity Instruments $ - - $ -	Financial Assets at FVTOCI
		Equity Instruments $ 98,491 (42,777) $ 55,714

Balance at January 1, 2023 Purchases Transfers into Level 1 Recognized in other comprehensive income (included in unrealized valuation gain (loss) on financial assets at FVTOCI) Balance at December 31, 2023	Financial Assets at FVTPL Equity Instruments $ - - - - $ -	Financial Assets at FVTOCI
		Equity Instruments $ 213,170 40,435 (190,879) 35,765 $ 98,491

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.

• 3) Valuation techniques and inputs applied for the purpose of measuring Level 2 fair value measurement

Financial Instruments Derivatives - foreign exchange forward contracts and exchange contracts Redemption options on convertible bonds

Valuation Techniques and Inputs

Discounted cash flow. 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. Binomial tree valuation model. 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.

• 50 -

• 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.

• 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 FVTPL (3) Amortized cost (4)	December 31
	2024 2023 $ 61,965 $ - 5,495,504 4,853,227 96,392 171,335 - 18,323 3,347,259 5,701,342

• 1) The balances include foreign exchange forward contracts and exchange contracts, domestic listed shares, redemption options on convertible bonds and investment of equity instruments.

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

• 3) The balances include foreign exchange forward contracts and exchange contracts.

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

• d. Financial risk management objectives and policies

The Company’s major financial instruments include equity and debt investments, notes receivable, trade receivables, other receivables, notes payable, trade payables, other payables and borrowings. The Company’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 Company through internal risk reports that analyze exposures by degree and magnitude of risks. These risks include market risk (including foreign currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Company seek 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 Company’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 is reviewed by the internal auditors on a continuous basis. The Company did not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

The corporate treasury function reports quarterly to the Company’s risk management committee, an

• 51 -

independent body that monitors risks and policies implemented to mitigate risk exposures.

1) Market risk

The Company’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 Company 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 Company’s foreign currency monetary.

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

a) Foreign currency risk

Several subsidiaries of the Company have foreign currency denominated sales and purchases, which exposes the Company to foreign currency risk. Exchange rate exposures are managed within approved policy parameters utilizing foreign exchange forward contracts.

The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities (including those eliminated on consolidation) at the end of the reporting period are set out in Note 32.

Sensitivity analysis

The Company is mainly exposed to the USD, JPY and RMB.

The following table details the Company’s sensitivity to a 1% increase and decrease in the New Taiwan dollar (i.e., 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 adjusts 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 Company 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 weakening 1% against the relevant currency. For a 1% strengthening 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.

USD impact (i) JPY impact (ii) RMB impact (iii)	Profit or Loss
	2024 2023 $ 23,306 $ 23,029 (72) (2,573) (2,903) (5,178)

• i. The result was mainly attributable to the exposure on outstanding monetary items in USD that were not hedged at the end of the year.

• ii. The result was mainly attributable to the exposure on outstanding monetary items in JPY that were not hedged at the end of the year.

• 52 -

• iii. The result was mainly attributable to the exposure on outstanding monetary items in RMB that were not hedged at the end of the year.

• b) Interest rate risk

The Company is exposed to interest rate risk because the Company deposits and borrow funds at floating interest rates.

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

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities	**December 31 **
	2024 2023 $ 1,117,721 $ 729,240 36,000 1,589,820 1,257,240 1,318,299 916,666 1,892,754

Sensitivity analysis

The sensitivity analysis below was determined based on the Company’s exposure to interest rates for both derivatives and non-derivative instruments at the end of the year. For floating rate liabilities, the analysis was prepared assuming the amount of each liability outstanding at the end of the year 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 Company’s pre-tax profit for the years ended December 31, 2024 and 2023 would increased/(decreased) by $851 thousand and $(1,436) thousand, respectively, which was mainly a result of 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 Company. At the end of the year, the Company’s maximum exposure to credit risk, which would cause a financial loss to the Company due to the failure of the counterparty to discharge its obligation and due to the financial guarantees provided by the Company, 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.

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3) Liquidity risk

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

The Company relies on bank borrowings as a significant source of liquidity. As of December 31, 2024 and 2023, the Company had available unutilized short-term bank loan facilities of approximately $6,747,333 thousand and $4,411,246 thousand, respectively.

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

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

To extend that interest flows are at floating rate, the undiscounted amount was derived from the interest rate curve at the end of the year.

December 31, 2024

	Weighted
	Interest
	Average
	Effective
	Interest Rate	Less than
	(%)	1 Year		2-3 Years		4-5 Years			5+ Years		Total
Non-derivative financial
liabilities
Trade payables	-	$ 1,646,109	$	-	$		-	$		-	$ 1,646,109
Other payables	-	709,200		-			-			-	709,200
Lease liabilities	2.49%-3.14%	4,896		6,511			-			-	11,407
Variable interest rate
liabilities	0.98%-1.79%	383,333		533,333			-			-	916,666
Fixed interest rate liabilities	1.225%	36,000		-			-			-	36,000
December 31, 2023
	Weighted
	Interest
	Average
	Effective
	Interest Rate	Less than
	(%)	1 Year		2-3 Years		4-5 Years			5+ Years		Total
Non-derivative financial
liabilities
Trade payables	-	$ 1,581,756	$	-	$		-	$		-	$ 1,581,756
Other payables	-	627,462		-			-			-	627,462
Lease liabilities	1.27%-3.00%	2,270		1,631			-			-	3,901
Variable interest rate
liabilities	0.85%-1.55%	276,087		1,616,667			-			-	1,892,754
Fixed interest rate liabilities	1.10%	1,553,820		36,000			-			-	1,589,820

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

• 54 -

• b) Liquidity and interest risk rate tables for derivative financial liabilities

The following table details the Company’s liquidity analysis for its derivative financial instruments. The table was 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, 2024

On Demand or Less than 1 Month 1-3 Months 3 Months to 1 Year Net settled Foreign exchange forward contracts and exchange contracts $ 519 $ 896 $ - 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 $ 249 $ (13,381) $ (5,191)	1-5 Years $ - 1-5 Years $ -	5+ Years $ -
		5+ Years $ -

27. TRANSACTIONS WITH RELATED PARTY

Details of transactions between the Company and related parties are disclosed as follows.

• a. Related party name and category

Related Party Name Related Party Category Tai-Shing Electronics Components Corporation Associate EcLife Co., Ltd. Other associate Longying (Ningbo) Semiconductor Co., Ltd Other associate TXC (Ningbo) Corporation Subsidiary TXC (Chongqing) Corporation Subsidiary Ningbo Beilun Jingyu Trading Corporation Subsidiary TETC CORP. NINGBO Subsidiary Shanghai JCH Co., Ltd. Subsidiary TXC Technology, Inc. Subsidiary Taiwan Crystal Technology (HK) Limited Subsidiary TXC Japan Corporation Subsidiary TXC Europe GmbH Subsidiary

• 55 -

b. Sales of goods

Line Item Related Party Category Sales Subsidiaries Associates Other associates	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2024 $ 1,145,867 28,560 5,823 $ 1,180,250	2023 $ 747,728 30,284 5,839 $ 783,851

In 2024 and 2023, the selling price and purchasing price were not significantly different from those with third parties, except those for NGB, CKG, TETC, Ningbo Jingyu, TXC Technology, TCTH and TXC JP whose trading price depends on its function within the Company.

c. Purchases of goods

Related Party Category Subsidiaries TXC (Ningbo) Corporation TXC (Chongqing) Corporation Others Other associates	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2024 $ 2,491,061 1,388,616 526,938 4,406,615 417 $ 4,407,032	2023 $ 1,885,105 1,680,693 410,384 3,976,182 299 $ 3,976,481

In 2024 and 2023, the selling price and purchasing price were not significantly different from those with third parties, except those for NGB, CKG, TETC, Ningbo Jingyu, TXC Technology, TCTH and TXC JP whose trading price depends on its function within the Company.

d. Other income

Related Party Category Associates Operating expenses Related Party Category Subsidiaries TXC Technology, Inc. TXC Japan Corporation TXC Europe GmbH Other associates	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2024 2023 $ 101 $ 95 For the Year Ended December 31
		2024 $ 61,653 27,997 12,852 102,502 1,587 $ 104,089	2023 $ 55,324 30,291 12,336 97,951 628 $ 98,579

e. Operating expenses

• 56 -

The consulting fee above is due to the Company’s part of business activities committed to the related parties.

f. Rental revenue

Related Party Location Rent Collection 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 December 31	For the Year Ended December 31	For the Year Ended December 31
		2024 Amount % to Total Account Balance $ 3,619 -		2023
				Amount % to Total Account Balance $ 3,568 -

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

Related Party Category Subsidiaries TXC (Ningbo) Corporation TETC Corp. Ningbo Others Associates Other associates Less: Allowance for impairment loss		**December 31 **	**December 31 **
		2024 $ 268,868 66,620 7,544 343,032 7,590 1,159 (68) $ 351,713	2023 $ 175,833 31,303 4,502 211,638 7,405 1,015 (68) $ 219,990

The outstanding accounts receivable from related parties are unsecured.

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

Related Party Category Subsidiaries TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC Corp. Ningbo Others Other associates		**December 31 **	**December 31 **
		2024 $ 650,476 331,936 114,567 3,134 1,100,113 19 $ 1,100,132	2023 $ 427,317 540,231 101,648 5,725 1,074,921 38 $ 1,074,959

The outstanding trade payables to related parties are unsecured.

• 57 -

• i. Other receivables from related parties

Related Party Category Subsidiaries TXC (Ningbo) Corporation Ningbo Beilun Jingyu Trading Corporation Associates Other associates		December 31	December 31
		2024 $ 1,072 - 1,072 - 14 $ 1,086	2023 $ 3,074 4,328 7,402 425 1 $ 7,828

Other receivables resulted from purchasing machinery and equipment on behalf of subsidiaries.

• j. Other payables to related parties

Related Party Category Subsidiaries Other associates		**December 31 **	**December 31 **
		2024 $ 35 16,817 $ 16,852	2023 $ 44 1,825 $ 1,869

The credit period of the transaction above is similar to those for the third parties.

• k. Prepayments for equipment

Related Party Category Other associates Acquisitions for property, plant and equipment Related Party Category Other associates		December 31	December 31
	2024 2023 $ 809 $ 4,502 For the Year Ended December 31
		2024 $ 38,114	2023 $ 968

• l. Acquisitions for property, plant and equipment

• m. Remuneration of key management personnel

Related Party Category Short-term employee benefits Post-employment benefits	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2024 $ 81,706 585 $ 82,291	2023 $ 66,161 989 $ 67,150

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

• 58 -

28. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets were provided as collateral for foreign exchange forward contracts:

Pledged deposits		December	31
		2024 $ 78,674	2023 $ 75,342

29. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

In addition to those disclosed in other notes, significant contingencies and unrecognized commitments of the Company at December 31, 2024 were as follows:

As of December 31, 2024, the Company unrecognized commitments are as follows:

In Thousands of Foreign Currencies/New Taiwan Dollars

Acquisition of machinery and equipment Acquisition of machinery and equipment Acquisition of machinery and equipment	Contract Amount Paid Amount Unpaid Amount $ 648,153 $ 389,949 $ 258,204 RMB 1,890 RMB 756 RMB 1,134 USD 195 USD 180 USD 15

30. SIGNIFICANT EVENTS AFTER REPORTING PERIOD: NONE

31. OTHER ITEMS

On February 15, 2023, the president of the ROC announced the amendments to the “Climate Change Response Act”, which added the provision of carbon fee collection. Subsequently, the Ministry of Environment announced the “Regulations Governing the Collection of Carbon Fees”, “Regulations for Administration of Voluntary Reduction Plans” and “Designated Greenhouse Gas Reduction Goal for Entities Subject to Carbon Fees” on August 29, 2024 and the carbon fee rate on October 21, 2024. The fee will be levied starting from January 1, 2025. Based on the emissions of the Group in 2023, the Group expects that it sill not be the entity subject to carbon fees.

• 59 -

32. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

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

Unit: In Thousands of Foreign Currencies and New Taiwan Dollars

December 31, 2024

		Foreign		Carrying
		Currency	Exchange Rate	Amount
Financial assets
Monetary items
USD	$	103,188	32.7810 (USD:NTD)	$ 3,382,606
JPY		1,353,397	0.2098 (JPY:NTD)	283,943
RMB		9,393	4.5603 (RMB:NTD)	42,835
Non-monetary items
Investments accounted for using the equity
method
USD		7,132	32.7810 (USD:NTD)	233,809
JPY		151,882	0.2098 (JPY:NTD)	31,865
RMB		1,947,188	4.5603 (RMB:NTD)	8,879,763
EUR		385	34.1316 (EUR:NTD)	13,142
Financial liabilities
Monetary items
USD		32,093	32.7810 (USD:NTD)	1,052,041
JPY		1,387,877	0.2098 (JPY:NTD)	291,177
RMB		73,056	4.5603 (RMB:NTD)	333,157
December 31, 2023
		Foreign		Carrying
		Currency	Exchange Rate	Amount
Financial assets
Monetary items
USD	$	97,184	30.7350 (USD:NTD)	$ 2,986,950
JPY		449,288	0.2173 (JPY:NTD)	97,630
RMB		5,214	4.3394 (RMB:NTD)	22,626
Non-monetary items
Investments accounted for using the equity
method
USD		7,041	30.7350 (USD:NTD)	216,390
JPY		148,908	0.2173 (JPY:NTD)	32,358
RMB		1,743,028	4.3394 (RMB:NTD)	7,563,696
EUR		332	34.0114 (EUR:NTD)	11,300
				(Continued)

• 60 -

		Foreign		Carrying
		Currency	Exchange Rate	Amount
Financial liabilities
Monetary items
USD	$	22,257	30.7350 (USD:NTD) $	684,069
JPY		1,633,573	0.2173 (JPY:NTD)	354,975
RMB		124,531	4.3394 (RMB:NTD)	540,390
				(Concluded)

For the years ended December 31, 2024 and 2023, realized and unrealized net foreign exchange gains or losses were $188,689 thousand and $28,760 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 Company.

33. SEPARATELY DISCLOSED ITEMS

• a. Information on significant transactions:

• 1) Financing provided to others. (None)

• 2) Endorsements/guarantees provided. (None)

• 3) Marketable securities held (excluding investments in subsidiaries, associates and joint ventures). (Table 1)

• 4) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million or 20% of paid-in capital. (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 individual real estate at prices of at least NT$300 million or 20% of the paid-in capital. (None)

• 7) Total purchases from or sales or to related parties amounting to at least NT$100 million or 20% of the paid-in capital. (Table 2)

• 8) 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)

• 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 year, 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

• 61 -

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 year.

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

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

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

• e) The highest balance, the ending 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 year 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 (Table 7)

• 62 -

TABLE 1

TXC CORPORATION

MARKETABLE SECURITIES HELD DECEMBER 31, 2024 (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, 2024			Note
				Shares		Carrying Amount	Percentage of Ownership		Fair Value
TXC Corporation TXC (Ningbo) Corporation	Stock-unlisted company Godsmith Sensor Inc RFIC Technology Corporation Gallopwave Inc. Stock-listed company Taiwan Semiconductor Manufacturing Company, Ltd. Win Win Precision Technology Co., Ltd. Shares overseas-unlisted company Stathera IP Holdings Inc. Convertible bonds WPG HOLDINGS LIMITED TCC Group Holdings CO., LTD. Shares overseas-unlisted company Ningbo SJ Electronics Co., Ltd. Structured deposits Agricultural Bank of China. Bank of Ningbo China Everbright Bank China Guangfa Bank	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 profit or loss - current 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 Financial assets at fair value through profit or loss - current 〃 〃 〃	800 3,334 6,250 40 1,788 65 75 100 567 RMB 40,364 RMB 40,312 RMB 15,150 RMB 10,136		$ 3,201 25,912 20,179 43,000 40,678 $ 132,970 $ 6,422 $ 7,620 9,930 $ 17,550 $ 171,805 $ 184,071 183,837 69,088 46,223 $ 483,219	4 12 8 - 3 1 - - 5 - - - -		$ 3,201 25,912 20,179 43,000 40,678 $ 132,970 $ 6,422 $ 7,620 9,930 $ 17,550 $ 171,805 $ 184,071 183,837 69,088 46,223 $ 483,219

(Continued)

• 63 -

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account			December	31, 2024			Note
				Shares		Carrying Amount	Percentage of Ownership		Fair Value
TXC (Chongqing) Corporation Ningbo Beilun Jingyu Trading Corporation Ningbo Meishan Free Trade Port Area Ding Kai Investment Management Company Limited Chongqing Zhongyang Properties Co., Ltd. ChongQing Dingsen Commercial Management Co., Ltd. TETC Corp. Ningbo	Structured deposits China Construction Bank China Merchants Bank China CITIC Bank Bank of China Beneficiary certificate Southern Cash Fund Shares overseas-unlisted company Zhejiang Bright Semiconductor Technology Co., Ltd. Structured deposits Chongqing Rural Commercial Bank China Construction Bank Corporation Structured deposits China Construction Bank Corporation Structured deposits Agricultural Bank of China Bank of Ningbo	None 〃 〃 〃 None None None 〃 None None 〃	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 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 profit or loss - current 〃	RMB 20,038 RMB 10,059 RMB 10,003 RMB 95,684 RMB 68 7,004 RMB 9,191 RMB 6,039 RMB 803 RMB 30,273 RMB 20,177		$ 91,380 45,873 45,616 436,346 $ 619,215 $ 308 $ 132,706 $ 41,913 27,539 $ 69,452 $ 3,663 $ 138,053 92,015 $ 230,068	- - - - - 3 - - - - -		$ 91,380 45,873 45,616 436,346 $ 619,215 $ 308 $ 132,706 $ 41,913 27,539 $ 69,452 $ 3,663 $ 138,053 92,015 $ 230,068

(Concluded)

• 64 -

TABLE 2

TXC CORPORATION

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2024

(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 TETC CORP. NINGBO	Subsidiary ″ ″ ″ ″ ″ ″	Purchase Sale Purchase Purchase Sale Purchase Sale	$ 2,491,061 967,537 1,388,616 489,701 153,510 198,303 173,719	35 10 20 7 2 8 4	No significant differences with the third parties. ″ ″ ″ ″ ″ ″	Its trading price depends on its function within the Group ″ ″ ″ ″ ″ ″	No significant differences with the third parties. ″ ″ ″ ″ ″ ″	$ (650,476) 268,868 (331,936) (114,567) 66,620 (55,324) 102,466	(40) 9 (20) (7) 2 (7) 9

• 65 -

TABLE 3

TXC CORPORATION

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL DECEMBER 31, 2024

(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	**Actions Taken **
TXC Corporation TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO TXC (Ningbo) Corporation	TXC (Ningbo) Corporation TXC Corporation TXC Corporation TXC Corporation TETC CORP. NINGBO	Subsidiary Parent entity Parent entity Parent entity Subsidiary	$ 268,868 650,476 331,936 114,567 102,466	4.35 4.62 3.18 4.53 3.02	$ - - - - -	- - - - -	$ 125,973 413,234 200,719 68,441 59,088	$ - - - - -

• 66 -

TABLE 4

TXC CORPORATION

INFORMATION ON INVESTEES FOR THE YEAR ENDED DECEMBER 31, 2024 (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,	2024	Net Income (Losses) of the Investee	Share of Profit (Loss)	Note
				December 31, 2024	December 31, 2023	Shares (In Thousands)	Percentage of Ownership	Carrying Amount
TXC Corporation TXC (Ningbo) Corporation	Taiwan Crystal Technology International Ltd. Taiwan Crystal Technology (HK) Limited TXC Japan Corporation TXC Technology Inc. Tai-Shing Electronics Components Corporation TXC Europe GmbH PT TXC TECHNOLOGY INDONESIA	Western Samoa Hong Kong Japan U.S.A. Taiwan Germany Indonesia	Investment management International trading Marketing activities Marketing activities Manufacture and sales of electronics products Marketing activities Research and development, manufacture, and sale of quartz elements and related electronic products	$ 1,390,461 2,371 6,172 9,879 373,432 1,746 517,840	$ 1,390,461 2,371 6,172 9,879 373,432 1,746 -	42,835 80 2 300 8,802 50 1,600	100.00 100.00 100.00 100.00 33.34 100.00 81.22	$ 8,879,763 209,731 31,865 24,078 428,728 13,142 518,372	$ 1,230,706 3,700 839 (747) 90,816 1,834 (4,645)	$ 1,224,898 3,700 839 (747) 30,280 1,834 (3,768)

• 67 -

TABLE 5

TXC CORPORATION

INFORMATION ON INVESTMENT IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2024 (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	Paid-in Capital	Method of Investment	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2024 (In Thousand)	Remittance of Funds	Remittance of Funds	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2024 (In Thousand)	Net Income (Loss) of the Investee	Percentage of Ownership	Investment Gain (Loss)	Carrying Amount as of December 31, 2024	Accumulated Repatriation of Investment Income as of December 31, 2024
					Outward	Inward
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 1,162,074 656,740 684,908 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 - - - - - - - -	$ 1,230,707 237,758 446,724 (18,876) 268 (47,939) - 2,557 8,390	100.00 100.00 100.00 100.00 100.00 29.37 100.00 100.00 100.00	$ 1,230,707 237,758 446,724 (18,876) 268 (14,080) - 2,557 8,390	$ 8,956,700 1,926,753 1,992,969 795,160 6,670 36,234 132,987 1,342 19,923	$ 1,752,692 306,500 - - - - - - -

1. The limited amounts of the investment in Mainland China

Accumulated Outward Remittance for Investments in Mainland China as of December 31, 2024	Investment Amounts Authorized by the Investments Commission, MOEA	Upper Limit on the Amount of Investments Stipulated by the Investment Commission, MOEA
$1,427,630	$2,350,052	$ -

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.

• 68 -

TABLE 6

FOR THE YEAR ENDED DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

TXC CORPORATION

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

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

Company Name	Investee Company	Transaction Type	Purchase/Sale	Purchase/Sale	Price	Transaction Details	Transaction Details	Notes/Accounts Receivable (Payable)	Notes/Accounts Receivable (Payable)	Unrealized (Gain) Loss	Note
			Amount	%		Payment Term	Comparison with **Normal Transactions **	Ending Balance	%
TXC Corporation	TXC (Ningbo) Corporation TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO TETC CORP. NINGBO	Purchase Sales Purchase Sales Purchase	$ 2,491,061 967,537 1,388,616 153,510 489,701	35 10 20 2 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 〃 〃 〃 〃	$ (650,476) 268,868 (331,936) 66,620 (114,567)	(40) 9 (20) 2 (7)	$ 44,276 8,335 18,625 5,753 4,289

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. Financings 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. 69 -

TABLE 7

TXC CORPORATION

INFORMATION OF MAJOR SHAREHOLDERS DECEMBER 31, 2024

Name of Major Shareholder	Shares	Shares
	Number of Shares	Percentage of Ownership (%)
Walsin Technology Corporation	34,942,000	10.18

Note: The information of major shareholders presented in this table is provided by the Taiwan Depository & Clearing Corporation based on the number of ordinary shares and preferred shares held by shareholders with ownership of 5% or greater, that have been issued without physical registration (including treasury shares) by the Company as of the last business day for the current quarter. The share capital in the consolidated financial statements may differ from the actual number of shares that have been issued without physical registration because of different preparation basis.

• 70 -

TXC CORPORATION

THE CONTENTS OF STATEMENTS OF MAJOR ACCOUNTING ITEMS

Item Major Accounting Items in Assets, Liabilities and Equity Statement of cash and cash equivalents Statement of financial assets at fair value through profit or loss - non-current Statement of notes receivable Statement of trade receivables Statement of other receivables Statement of inventories Statement of changes in financial assets at fair value through other comprehensive income - non-current Statement of changes in investments accounted for using the equity method Statement of changes in property, plant and equipment Statement of changes in accumulated depreciation of property, plant and equipment Statement of changes in accumulated impairment of property, plant and equipment Statement of changes in investment properties Statement of changes in accumulated depreciation of investment properties Statement of deferred income tax assets Statement of financial liabilities at fair value through profit or loss - current Statement of trade payables Statement of other payables Statement of long-term loans Statement of deferred income tax liabilities Major Accounting Items in Profit or Loss Statement of net revenue Statement of cost of goods sold Statement of manufacturing expenses Statement of operating expenses Statement of other gain and losses Statement of finance costs Statement of labor, depreciation and amortization by function

**Statement Index **

Statement 1 Table 1 Note 10 Statement 2 Note 10 Statement 3 Statement 4 Statement 5 Note 13 Note 13 Note 13 Note 15 Note 15 Note 23 Note 7 Statement 6 Note 18 Statement 7 Note 23 Statement 8 Statement 9 Statement 10 Statement 11 Note 22 Note 22 Statement 12

• 71 -

STATEMENT 1

TXC CORPORATION

CASH AND CASH EQUIVALENTS DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars, and Foreign Currencies)

Item Cash Cash on hand Including US$3 thousand @32.781; JPY352 thousand @0.2098; HK$2 thousand @4.2223; and RMB18 thousand @4.5603; SGD3 thousand @24.1241; EUR3 thousand @34.1316 Cash in banks Checking accounts and demand deposits Foreign-currency deposits Including US$7,999 thousand @32.781; JPY1,252,879 thousand @0.2098; EUR55 thousand @34.1316; RMB8,835 thousand @4.5603; and HK$2 thousand @4.2223 Time deposits Including US$1,000 thousand @32.781; and RMB10,000 thousand @4.5603 Cash equivalents

Amount $ 479 650,602 567,301 978,384 100,000 $ 2,296,766

• 72 -

STATEMENT 2

TXC CORPORATION

TRADE RECEIVABLES DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

Item Explanation Related parties TXC (Ningbo) Corporation For goods TXC (Chongqing) Corporation ″ Tai-Shing Electronics Components Corporation ″ TETC CORP. NINGBO ″ TXC Japan Corporation ″ TXC Europe GmbH ″ TXC Technology, Inc. ″ EcLife Co., Ltd. ″ Less: Allowance for impairment loss Third parties A Company For goods B Company ″ Others (Note) ″ Less: Allowance for impairment loss	Amount $ 268,868 1,387 7,590 66,620 870 5,278 9 1,159 351,781 (68) $ 351,713 $ 338,962 223,845 2,149,881 2,712,688 (9,303) $ 2,703,385

Note: Each of the accounts was less than 5% of the total account balance.

• 73 -

STATEMENT 3

TXC CORPORATION

INVENTORIES DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

Item Raw materials Supplies and spare parts Work in process Finished goods Merchandise Goods in transit Less: Allowance for loss	Cost Market Value (Note) $ 332,549 $ 324,394 113,235 112,410 393,289 391,022 290,072 269,942 397,438 394,739 11,146 11,146 1,537,729 $ 1,503,653 (34,076) $ 1,503,653

Note: The market value is based on net realizable value.

• 74 -

STATEMENT 4

TXC CORPORATION

CHANGES IN FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME - NON-CURRENT FOR THE YEAR ENDED DECEMBER 31, 2024

(In Thousands of New Taiwan Dollars and Shares)

Listed shares Win Win Precision Technology Co., Ltd. Unlisted shares Godsmith Sensor Inc. Gallopwave Inc. RFIC Technology Corporation Stathera IP Holdings Inc.	Beginning Balance Shares Amount Remeasure 1,788 $ 72,844 $ (32,166) 800 3,672 (471) 6,250 34,403 (14,224) 3,334 29,981 (4,069) 65 30,435 (24,013) 98,491 (42,777) $ 171,335 $ (74,943)	Increase Shares Amount - $ - - - - - - - - - - $ -	Decrease Shares Amount - $ - - - - - - - - - - $ -	Ending Balance	Pledge or Amount Security $ 40,678 None 3,201 〃 20,179 〃 25,912 〃 6,422 〃 55,714 $ 96,392
				% of Shares Ownership 1,788 3 800 4 6,250 8 3,334 12 65 1
	Shares 1,788 800 6,250 3,334 65	Shares - - - - -	Shares - - - - -

• 75 -

STATEMENT 5

TXC CORPORATION

CHANGES IN INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD FOR THE YEAR ENDED DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars and Shares)

Unlisted company Taiwan Crystal Technology International Ltd. TXC Technology Inc. TXC Japan Corporation Taiwan Crystal Technology (HK) Limited Tai-Shing Electronics Components Corporation TXC Europe GmbH	Beginning Balance Shares Amount 42,835 $ 7,563,696 300 23,290 2 32,358 80 193,100 8,802 397,952 50 11,300 $ 8,221,696	Increase Shares Amount - $ - - - - - - - - - - - $ -	Decrease Shares Amount - $ 402,840 - - - - - - - 17,605 - - $ 420,445	Equity in Investees Gain (Loss) $ 1,718,907 788 (493) 16,631 48,381 1,842 $ 1,786,056	Ending Balance	Amount $ 8,879,763 24,078 31,865 209,731 428,728 13,142 $ 9,587,307	Market Price or Net Asset Value Valuation Unit Price Amount Method Pledge or Security - $ 8,879,763 Equity method None - - 24,078 Equity method None - - 31,865 Equity method None - - 209,731 Equity method None - 47.80 428,728 Equity method None - - 13,142 Equity method None - $ 9,587,307
					% of Shares Ownership 42,835 100.00 300 100.00 2 100.00 80 100.00 8,802 33.34 50 100.00
	Shares 42,835 300 2 80 8,802 50	Shares - - - - - -	Shares - - - - - -				Unit Price - - - - 47.80 -

Note: All the above are unlisted company which do not have market price to evaluated.

• 76 -

STATEMENT 6

TXC CORPORATION

ACCOUNTS PAYABLE DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

Item Explanation Related parties TXC (Ningbo) Corporation Payment for goods TXC (Chongqing) Corporation ″ Taiwan Crystal Technology (HK) Limited ″ EcLife Co., Ltd. ″ Ningbo Beilun Jingyu Trading Corporation ″ TETC CORP. NINGBO ″ Third parties A Corporation Payment for goods B Corporation ″ C Corporation ″ D Corporation ″ E Corporation ″ F Corporation ″ G Corporation ″ Others (Note) ″	Amount $ 650,476 331,936 3,104 19 30 114,567 1,100,132 92,656 82,681 74,283 51,792 48,543 42,620 32,071 121,331 545,977 $ 1,646,109

Note: Each of the accounts was less than 5% of the total account balance.

• 77 -

STATEMENT 7

TXC CORPORATION

STATEMENT OF LONG-TERM BORROWINGS DECEMBER 31, 2024

(In Thousands of New Taiwan Dollars)

Bank Name Description CTBC Financial Holding Co., Ltd Credit loan DBS Bank Limited Credit loan Cathay United Bank Credit loan E.SUN COMMERCIAL BANK, LTD Credit loan Less: Current portions	Amount Issuance Date Interest Rate Collateral $ 83,333 2021.08.17-2026.08.17 0.98% - 300,000 2023.08.03-2025.08.03 1.55% - 536,000 2020.04.01-2026.04.30 1.225%-1.79% - 33,333 2020.04.15-2025.04.15 1.225% - 952,666 (419,333) $ 533,333

• 78 -

STATEMENT 8

TXC CORPORATION

OPERATING REVENUE FOR THE YEAR ENDED DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

Item Quartz crystal products Less: Sales returns Less: Sales allowances	Amount $ 9,863,254 24,723 17,487 $ 9,821,044

• 79 -

STATEMENT 9

TXC CORPORATION

COST OF GOODS SOLD FOR THE YEAR ENDED DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

Item Direct materials Beginning materials Add: Material purchase Add: Unfavorable cost variance Less: Expense Less: Others Ending materials Direct labor Overhead Manufacturing cost Beginning work in process Add: Purchases Add: Others Less: Expense Less: Favorable cost variance Ending work in process Finished goods cost Beginning finished goods Add: Unfavorable cost variance Less: Expense Add: Others Ending finished goods Production cost Beginning merchandise inventory Add: Purchase Add: Unfavorable cost variance Less: Expense Less: Others Ending merchandise inventory Purchase cost Loss on physical inventory

Amount $ 456,201 1,095,860 118,488 (161,331) (8,606) (436,804) 1,063,808 322,150 901,074 2,287,032 272,310 469,242 7,754 (48,993) (64,663) (391,022) 2,531,660 240,845 60,589 (19,844) 46 (269,942) 2,543,354 475,460 5,043,040 3,527 (566) (6,518) (394,739) 5,120,204 8,699 $ 7,672,257

• 80 -

STATEMENT 10

TXC CORPORATION

OVERHEAD EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

Item Explanation Indirect labor Including salary and wages, pension, food stipend, employee benefits and insurance etc. Indirect materials Depreciation Utilities Others	Amount $ 336,204 105,756 295,462 125,091 38,561
	$ 901,074

Note: Each of the accounts was less than 5% of the total account balance.

• 81 -

STATEMENT 11

TXC CORPORATION

OPERATING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2024 (In Thousands of New Taiwan Dollars)

		Selling and	Selling and	General and	Research and
Item	Explanation	Marketing		Administration	Development
Salary		$	61,766	$ 153,384	$ 318,117
Insurance			4,428	18,418	18,176
Depreciation			489	5,146	208,152
Research expense			-	-	101,605
Import and export expense			36,028	-	-
Others			159,058	70,976	77,096
		$	261,769	$ 247,924	$ 723,146

Note: Each of the accounts was less than 5% of the total account balance.

• 82 -

STATEMENT 12

TXC CORPORATION

EMPLOYEE WELFARE, DEPRECIATION AND AMORTIZATION EXPENSES FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (In Thousands of New Taiwan Dollars)

Item Salaries Insurance Pension Remuneration of directors Other employee benefit Depreciation expenses Amortization expenses			2024	Total $ 1,057,595 76,983 32,264 40,213 30,455 $ 1,237,510 $ 509,249 $ 10,821			2023
		Operating Cost $ 579,552 42,444 17,253 - 19,280 $ 658,529 $ 295,462 $ 47	Operating Expense $ 478,043 34,539 15,011 40,213 11,175 $ 578,981 $ 213,787 $ 10,774			Operating Cost $ 535,310 46,984 18,448 - 20,949 $ 621,691 $ 296,474 $ 47	Operating Expense $ 403,498 36,351 14,838 32,472 10,285 $ 497,444 $ 206,621 $ 12,339	Total $ 938,808 83,335 33,286 32,472 31,234 $ 1,119,135 $ 503,095 $ 12,386

• Note 1: As of December 31, 2024 and 2023, the number of employees was 989 and 1,072 people both with 8 directors not included in the employees.

• Note 2: Information should be disclosed:

• a. The average of employee benefit is $1,220 thousand in the current year. The average of employee benefit is $1,021 thousand in the previous year.

• b. The average of salaries is $1,078 thousand in the current year. The average of salaries is $882 thousand in the previous year.

• c. Change in the average of salaries adjustment rates is 22.18%.

• Note 3: The Company did not have the supervisors for the years ended December 31, 2024 and 2023. Therefore, the Company did not have the corresponding remuneration of supervisors.

• Note 4: The Company and its subsidiaries set the salary scales according to the relative contribution of the employees’ positions, in line with the Company’s operation and development strategy, and based on their personal performance, future development potential and the Company’s operation status as the basis for salary adjustment and bonus payment, so as to encourage the employees to make positive efforts and excellent performance and to achieve the “internal fairness” and “individual fairness” pursuant to the salary; and to encourage employees to deliver great performance at work, the Company allocates a certain proportion of profitmaking earnings as the basis of employee dividends and shares the earnings results with colleagues, considers the benchmark enterprises of the industry, regularly checks the rationality of various salary and welfare systems by the “remuneration committee”, maintains the Company’s high level employee welfare, attracts outstanding talents to join and stay for a long time.

• Note 5: The remuneration of directors is determined based on the Company’s Articles of Incorporation. Fair remuneration is provided by considering the operation results and contributions towards company performance. President and vice presidents remuneration payment policy is based on the Company’s Salary Management Rules and salary levels for that job position in the industry market, the scope of authority of that job position inside the Company and the degree of contribution toward operation targets. The procedure for setting remuneration follows evaluation and review procedures under the Company’s Director and Manager Performance Evaluation Rules. In addition, the Company’s overall operational performance, future industry risks and development trends, individual performance achievement rates and contribution towards company performance are also considered in order to provide a fair compensation. The fairness of related performance evaluations and remuneration are reviewed by the salary and compensation committee and board of directors. The remuneration system is discussed at appropriate time based on the actual operating conditions and with respect to related laws to achieve a balance between sustainable company operation and risk control.

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