TXC - Interim / Quarterly Report 2023

TXC Corporation and Subsidiaries Consolidated Financial Statements for the Three Months Ended March 31, 2023 and 2022

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Note 6) Financial assets at fair value through profit or loss - current (Note 7) Financial assets at amortized cost - current (Note 9) Notes receivable (Note 10) Trade receivables (Note 10) Trade receivables from related parties (Notes 10 and 30) Other receivables Other receivables from related parties (Note 30) Inventories (Note 11) Non-current assets held for sale (Note 13) Other current assets Total current assets NON-CURRENT ASSETS Financial assets at fair value through profit or loss - non-current (Note 7) Financial assets at fair value through other comprehensive income - non-current (Note 8) Financial assets at amortized cost - non-current (Note 9) Investments accounted for using equity method (Note 14) Property, plant and equipment (Note 15) Right-of-use assets (Note 16) Investment properties (Note 17) Other intangible assets Deferred tax assets (Note 25) Prepayments for equipment Other non-current assets Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 18) Short-term bills payable (Note 18) Financial liabilities at fair value through profit or loss - current (Note 7) Contract liabilities - current (Notes 11 and 23) Trade payables Trade payables to related parties (Note 30) Other payables (Note 20) Other payables to related parties (Note 30) Current tax liabilities (Note 25) Lease liabilities - current (Note 16) Deferred revenue - current (Notes 20 and 27) Current portion of long-term borrowings (Note 18) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Note 19) Long-term borrowings (Note 18) Deferred tax liabilities (Note 25) Lease liabilities - non-current (Note 16) Deferred revenue - non-current (Notes 20 and 27) Net defined benefit liabilities - non-current (Note 21) Guarantee deposits received Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY (Note 22) Share capital Ordinary shares 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	March 31, 2023 (Reviewed) Amount % $ 4,456,344 23 407,394 2 378,078 2 39,974 - 2,695,434 14 8,906 - 18,963 - 5 - 2,710,597 14 - - 114,453 1 10,830,148 56 - - 650,372 3 89,228 1 468,019 3 6,181,434 32 205,086 1 570,184 3 55,574 - 48,234 - 151,338 1 12,081 - 8,431,550 44 $ 19,261,698 100 $ 354,885 2 - - - - 41 - 1,013,670 5 90 - 887,256 5 399 - 231,107 1 3,098 - 38,152 - 910,813 5 34,341 - 3,473,852 18 1,185,889 6 1,431,543 7 129,869 1 2,630 - 99,207 1 32,153 - 76,091 - 2,957,382 15 6,431,234 33 3,097,570 16 1,718,626 9 1,946,812 10 - - 6,180,347 32 8,127,159 42 (415,627) (2) 302,736 2 (112,891) - 12,830,464 67 $ 19,261,698 100	December 31, 2022 (Audited) Amount % $ 4,222,610 21 417,450 2 351,977 2 32,125 - 3,514,781 18 9,851 - 65,288 - 643 - 2,699,721 14 - - 98,005 - 11,412,451 57 - - 662,533 4 - - 458,607 2 6,319,742 32 205,984 1 571,346 3 53,838 - 61,271 - 94,538 1 10,934 - 8,438,793 43 $ 19,851,244 100 $ 513,750 3 - - 13,620 - 40 - 1,208,497 6 622 - 1,421,979 7 1,250 - 204,057 1 3,088 - 38,817 - 890,785 5 39,206 - 4,335,711 22 1,183,273 6 1,522,600 8 118,132 1 3,399 - 108,191 - 35,203 - 71,527 - 3,042,325 15 7,378,036 37 3,097,570 16 1,709,979 9 1,946,812 10 - - 5,861,917 29 7,808,729 39 (450,523) (2) 307,453 1 (143,070) (1) 12,473,208 63 $ 19,851,244 100	March 31, 2022 (Reviewed)	March 31, 2022 (Reviewed)
				Amount % $ 4,087,371 20 565,067 3 316,494 1 7,018 - 3,883,133 19 37,837 - 65,455 - 771 - 2,752,976 13 4,985 - 133,525 1 11,854,632 57 600 - 1,165,334 6 92,839 1 443,625 2 6,200,188 30 214,538 1 504,600 2 54,902 - 51,356 - 287,741 1 16,342 - 9,032,065 43 $ 20,886,697 100 $ 824,271 4 90,174 - 6,801 - 11,262 - 1,726,027 8 132 - 1,151,360 6 1,814 - 403,491 2 3,061 - 24,589 - 335,253 2 17,192 - 4,595,427 22 1,175,314 6 1,548,730 8 124,782 1 3,916 - 67,228 - 58,735 - 71,924 - 3,050,629 15 7,646,056 37 3,097,570 15 1,697,067 8 1,635,942 8 346,761 2 5,959,709 28 7,942,412 38 (303,365) (2) 806,957 4 503,592 2 13,240,641 63 $ 20,886,697 100

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

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

REVENUE (Note 23) COST OF GOODS SOLD (Note 24) GROSS PROFIT OPERATING EXPENSES (Note 24) Selling and marketing expenses General and administrative expenses Research and development expenses Total operating expenses PROFIT FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES Interest income (Note 24) Other income (Note 24) Other gains and losses (Note 24) Finance costs (Note 24) Share of profits of associates and joint venture (Note 14) Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Note 25) NET PROFIT OTHER COMPREHENSIVE INCOME (LOSS) Items that will not be reclassified subsequently to profit or loss: Unrealized gain (loss) on investments in equity instruments at fair value through other comprehensive income		For the Three Months	For the Three Months	Ended March 31
		2023 Amount % $ 2,297,988 100 (1,504,702) (65) 793,286 35 103,300 5 130,992 6 213,560 9 447,852 20 345,434 15 15,430 1 30,907 1 (27,671) (1) (13,157) (1) 129 - 5,638 - 351,072 15 (64,302) (3) 286,770 12 26,943 1		2022
				Amount % $ 3,216,567 100 (2,017,490) (63) 1,199,077 37 133,905 4 155,975 5 241,748 7 531,628 16 667,449 21 4,234 - 26,867 1 121,466 4 (10,971) (1) 2,361 - 143,957 4 811,406 25 (141,069) (4) 670,337 21 (445,887) (14) (Continued)

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

Items that may be reclassified subsequently to profit or loss: Exchange differences on translating the financial statements of foreign operations Share of the other comprehensive income of associates accounted for using the equity method Other comprehensive income (loss) for the period, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE PERIOD EARNINGS PER SHARE (Note 26) From continuing operations Basic Diluted		For the Three Months	For the Three Months	Ended March 31
		2023 Amount % $ 34,243 2 653 - 34,896 2 61,839 3 $ 348,609 15 $ 0.93 $ 0.90		2022
				Amount % $ 247,684 8 8,530 - 256,214 8 (189,673) (6) $ 480,664 15 $ 2.16 $ 2.09


		$		$

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

(Concluded)

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

TXC CORPORATION AND SUBSIDIARIES

BALANCE AT JANUARY 1, 2022 Net profit for the three months ended March 31, 2022 Other comprehensive income (loss) for the three months ended March 31, 2022, net of income tax Total comprehensive income (loss) for the three months ended March 31, 2022 Disposal of equity instruments at fair value through other comprehensive income (Note 8) Surplus donated BALANCE AT MARCH 31, 2022 BALANCE AT JANUARY 1, 2023 Net profit for the three months ended March 31, 2023 Other comprehensive income for the three months ended March 31, 2023, net of income tax Total comprehensive income for the three months ended March 31, 2023 Disposal of equity instruments at fair value through other comprehensive income (Note 8) Surplus donated Changes in capital surplus from investments in associates and joint ventures accounted for using the equity method BALANCE AT MARCH 31, 2023	Equity Attributable to Owners of the Company	Equity Attributable to Owners of the Company	Other Equity Exchange Differences on Translating the Financial Unrealized Gain (Loss) on Financial Assets at Fair Value Through Other Statements of Comprehensive Foreign Operations Income $ (559,579) $ 1,357,362 - - 256,214 (445,887) 256,214 (445,887) - (104,518) - - $ (303,365) $ 806,957 $ (450,523) $ 307,453 - - 34,896 26,943 34,896 26,943 - (31,660) - - - - $ (415,627) $ 302,736	Total Equity $ 12,759,694 670,337 (189,673) 480,664 - 283 $ 13,240,641 $ 12,473,208 286,770 61,839 348,609 - 293 8,354 $ 12,830,464
	Shares (In Thousands) Share Capital Capital Surplus 309,757 $ 3,097,570 $ 1,696,784 - - - - - - - - - - - - - - 283 309,757 $ 3,097,570 $ 1,697,067 309,757 $ 3,097,570 $ 1,709,979 - - - - - - - - - - - - - - 293 - - 8,354 309,757 $ 3,097,570 $ 1,718,626	Retained Earnings Unappropriated Legal Reserve Special Reserve Earnings $ 1,635,942 $ 346,761 $ 5,184,854 - - 670,337 - - - - - 670,337 - - 104,518 - - - $ 1,635,942 $ 346,761 $ 5,959,709 $ 1,946,812 $ - $ 5,861,917 - - 286,770 - - - - - 286,770 - - 31,660 - - - - - - $ 1,946,812 $ - $ 6,180,347

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

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expenses Amortization expenses Net (gain) loss on fair value change of financial assets and liabilities at fair value through profit or loss Finance costs Interest income Share of profits of associates and joint ventures Loss (gain) on disposal of property, plant and equipment Impairment losses recognized on property, plant and equipment Write-down of inventories Loss on disposal of non-current assets held for sale Changes in operating assets and liabilities: Notes receivable Trade receivables Trade receivables from related parties Other receivables Other receivables from related parties Inventories Other current assets Contract liabilities Trade payables Trade payables to related parties Other payables Other payables to related parties Other current liabilities Deferred revenue Net defined benefit liabilities - non-current Cash generated from operations Interest paid Income taxes paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of financial assets and liabilities at fair value through profit or loss Purchase of financial assets at fair value through other comprehensive income		For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 351,072 312,150 3,584 (9,635) 13,157 (15,430) (129) 36 1,819 3,230 - (7,849) 819,328 945 47,206 638 (14,138) (16,448) - (194,827) (532) (534,934) (851) (4,865) (9,649) (3,050) 740,828 (10,330) (12,384) 718,114 8,088 -	2022 $ 811,406 291,651 5,252 339 10,971 (4,234) (2,361) (294) 5 4,265 249 (2,339) 121,415 (6,943) 5,585 408 (118,152) (10,046) 448 (363,444) (2,008) (328,283) (1,681) (3,922) (2,672) (3,054) 402,561 (8,047) (38,988) 355,526 185,848 (10,000) (Continued)

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

Proceeds from sale of financial assets at fair value through other comprehensive income Purchase of financial assets at amortized cost Proceeds from disposal of non-current assets held for sale Payments for property, plant and equipment Proceeds from disposal of property, plant and equipment Payments for intangible assets Increase in other non-current assets Decrease in other non-current assets Increase in prepayments for equipment Interest received Net cash used in investing activities CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from short-term borrowings Repayments of short-term borrowings Proceeds from long-term borrowings Repayments of long-term borrowings Proceeds from guarantee deposits received Repayment of the principal portion of lease liabilities Other changes in capital surplus Net cash (used in) generated from financing activities EFFECTS OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS NET INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD		For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 40,064 (116,697) - (153,252) 1 (3,905) (1,147) - (56,800) 14,549 (269,099) - (150,224) 85,030 (155,652) 4,564 (769) 293 (216,758) 1,477 233,734 4,222,610 $ 4,456,344	2022 $ 117,447 (127,175) 1,745 (321,406) 496 (6,921) - 1,016 - 4,267 (154,683) 236,410 - - (76,765) 1,434 (759) 283 160,603 94,280 455,726 3,631,645 $ 4,087,371

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

(Concluded)

TXC CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise) (Reviewed, Not Audited)

1. GENERAL INFORMATION

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

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

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

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

To ensure the rights and interests of investors through full disclosure of operational governance, the Company applied for the Corporate Governance Assessment held by the Taiwan Corporate Governance Association (TCGA). For the “Corporate Governance Evaluation” jointly held by the Taiwan Stock Exchange Corporation (TWSE) and Taipei Exchange, under the category of listed companies, the company was awarded as the top 20 percent in 2014, top 5 percent from 2015 to 2017, and top 6 to 20 percent from 2018 to 2022. The Company will continue to strengthen corporate governance with the intention to achieve international standards for protection of public interest. 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, comprehensively implemented sustainable development based on scientific methods which met international mainstream, and fulfilled the responsibilities as a global citizen. All of the above are the efforts that The Company made to replace Corporate Social Responsibility Report to reinforce its operation sustainable development, the implement of energy saving and emission reducing, developing gender-friendly workplace, and fulfilling responsibilities for social benefit.

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved by the Company’s board of directors on May 8, 2023.

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 “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC)

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

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b. The IFRSs in issue but not yet endorsed and issued into effect by the FSC

New IFRSs Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture” Amendments to IFRS 16 “Leases Liability in a Sale and Leaseback” IFRS 17 “Insurance Contracts” Amendments to IFRS 17 Amendments to IFRS 17 “Initial Application of IFRS 9 and IFRS 17 - Comparative Information” Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” Amendments to IAS 1 “Non-current Liabilities with Covenants”	Effective Date Announced by IASB (Note 1)
	To be determined by IASB January 1, 2024 (Note 2) January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2024

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

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

IFRS 17 “Insurance Contracts”

Amendments to IFRS 17

Amendments to IFRS 17 “Initial Application of IFRS 9 and IFRS 17 -
Comparative Information”

Amendments to IAS 1 “Classification of Liabilities as Current or
Non-current”

Amendments to IAS 1 “Non-current Liabilities with Covenants”

Effective Date
Announced by IASB (Note 1)

To be determined by IASB
January 1, 2024 (Note 2)
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2024

Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.
Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and leaseback transactions entered into after the date of initial application of IFRS 16.
1) Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture”

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

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

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

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

The 2020 amendments also stipulate that, if the right to defer settlement is subject to compliance with specified conditions, the Group must comply with those conditions at the end of the reporting period even if the lender does not test compliance until a later date. The 2022 amendments further clarify that only covenants with which an entity is required to comply on or before the reporting date should affect the classification of a liability as current or non-current. Although the covenants to be complied with within twelve months after the reporting period do not affect the classification

of a liability, the Group shall disclose information that enables users of financial statements to understand the risk of the Group that may have difficulty complying with the covenants and repay its liabilities within twelve months after the reporting period.

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

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

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

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

4. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION

a. Statement of compliance

These interim consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IAS 34 “Interim Financial Reporting” as endorsed and issued into effect by the FSC. Disclosure information included in these interim consolidated financial statements is less than the disclosure information required in a complete set of annual financial statements.

b. Basis of preparation

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

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

1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
3) Level 3 inputs are unobservable inputs for the asset or liability.
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c. Basis of consolidation

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

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

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

All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation

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

d. Other material accounting policies

Except for the following, please refer to the consolidated financial statements for the year ended December 31, 2022.

1) Retirement benefits

Pension cost for an interim period is calculated on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant plan amendments, settlements, or other significant one-off events.

2) Other long-term employee benefits

Other long-term employee benefits are accounted for in the same way as the accounting required for defined benefit plans except that remeasurement is recognized in profit or loss.

3) Income tax expense

Income tax expense represents the sum of the tax currently payable and deferred tax. Interim period income taxes are assessed on an annual basis and calculated by applying to an interim period's pre-tax income the tax rate that would be applicable to expected total annual earnings.

5. MATERIAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

The same material accounting judgments and key sources of estimation uncertainty of consolidated financial statements have been followed in these consolidated financial statements as were applied in the preparation of the consolidated financial statements for the year ended December 31, 2022.

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6. CASH AND CASH EQUIVALENTS

March 31,
2023
December 31,
2022
March 31,
2022
Cash on hand
$ 1,166
$ 1,179
$ 1,243
Checking accounts and demand deposits
3,663,169
3,367,422
3,436,128
Cash equivalents (investments with original
maturities less than three months)
Time deposits
662,009
274,009
150,000
Repurchase agreements collateralized by bonds
130,000

580,000

500,000
$ 4,456,344
$ 4,222,610
$ 4,087,371
The market rate intervals of cash in bank at the end of the reporting period were as follows:
March 31,
2023
December 31,
2022
March 31,
2022
Demand deposits
0.001%-2.85% 0.001%-2.85% 0.0001%-0.35%
Time deposits
0.975%-4.75%
0.98%-4.13%
0.35%-0.60%
Repurchase agreements collateralized by bonds
0.99%-1.05%
1.02%
0.27%-0.32%
FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
March 31,
2023
December 31,
2022
March 31,
2022
Financial assets at FVTPL-current
Financial assets mandatorily classified as at
FVTPL
Derivative financial instruments (not under
hedge accounting)
Foreign exchange forward contracts and
exchange contracts (b)
$ 2,805
$ 3,662
$ 484
Non-derivative financial assets
Listed shares
-
20,350
13,500
Mutual funds
290
287
109,696
Hybrid financial assets
Structured deposits (a)

404,299

393,151

441,387

404,589

413,788

564,583
$ 407,394
$ 417,450
$ 565,067
Financial assets at FVTPL-non-current
Financial assets mandatorily classified as at
FVTPL
Non-derivative financial assets
Redemption options on convertible bonds
$ -
$ -
$ 600
(Continued)

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Financial liabilities at FVTPL-current Financial liabilities mandatorily classified as at FVTPL Derivative financial liabilities (not under hedge accounting) Foreign exchange forward contracts and exchange contracts (b)	March 31, 2023 December 31, 2022 $ - $ 13,620	March 31, 2022 $ 6,801 (Concluded)

a. The Group entered into structured time deposit contract with Bank during the three months ended March 31, 2023 and 2022. The structured time deposit contract includes an embedded derivative instrument which is not closely related to the host contract. The entire contract was assessed and classified mandatorily as at FVTPL since it contained a host that is an asset within the scope of IFRS 9.
b. At the end of the reporting period, outstanding foreign exchange contracts and exchange contracts not under hedge accounting were as follows:

			Contract Amount
	Currency	Maturity Date	(In Thousands)
March 31, 2023
Sell	USD/RMB	2023.04.26-2023.07.28	USD6,500/RMB44,621
Knock-out forward	USD/RMB	2023.04.11	USD3,000/RMB20,656
Knock-out forward	USD/JPY	2023.04.17-2023.05.22	USD4,000/JPY558,275
Exchange contracts	USD/NTD	2023.04.10-2023.07.24	USD29,000/NTD874,001
Foreign exchange forward	USD/NTD	2023.04.10-2023.04.13	USD5,000/NTD153,600
contracts
Foreign exchange forward	USD/JPY	2023.04.06-2023.04.25	USD2,000/JPY265,000
contracts
December 31, 2022
Sell	USD/RMB	2023.01.30-2023.04.26	USD10,000/RMB70,227
Sell	USD/JPY	2023.01.04-2023.01.10	USD2,500/JPY334,823
Exchange contracts	USD/NTD	2023.01.09-2023.03.29	USD29,000/NTD900,640
Foreign exchange forward	USD/NTD	2023.01.10	USD3,000/NTD99,000
contracts
March 31, 2022
Sell	USD/RMB	2022.04.27-2022.07.27	USD8,500/RMB54,276
Sell	USD/JPY	2022.04.06-2022.04.20	USD3,000/JPY349,360
Knock-out forward	USD/JPY	2022.04.11-2022.06.06	USD6,000/JPY259,070
Exchange contracts	USD/NTD	2022.04.11-2022.05.12	USD6,000/NTD166,016
Foreign exchange forward	USD/NTD	2022.05.19-2022.06.06	USD12,000/NTD337,800
contracts

The Group entered into foreign exchange forward contracts and exchange contracts during the three months ended March 31, 2023 and 2022 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 by using hedge accounting.

12 -

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Non-current Domestic investments Listed shares UPI Semiconductor Corp. Emerging market shares Win Win Precision Technology Co., Ltd. Unlisted shares Foreign investments Unlisted shares	March 31, 2023 December 31, 2022 $ 303,048 $ 262,122 136,833 - 22,291 213,170 462,172 475,292 188,200 187,241 $ 650,372 $ 662,533	March 31, 2022 $ 835,660 - 87,740 923,400 241,934 $ 1,165,334

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

On January 16, 2023, Win Win Precision Technology Co., Ltd.’s shares were listed on the emerging market of OTC. The transfers of financial assets measured at fair value are set out in Note 29.

In the first quarter of 2023 and 2022, the Group sold its shares in UPI Semiconductor Corp. in order to manage credit concentration risk. The shares sold had a fair value of $40,064 thousand and $117,447 thousand and its related unrealized gain of $31,660 thousand and $104,518 thousand was transferred from other equity to retained earnings.

9. FINANCIAL ASSETS AT AMORTIZED COST

Current Domestic investments Pledge deposits (a) Time deposits with original maturity of more than three months (b) Non-current Domestic investment Time deposits with original maturities of more than one year (b)	March 31, 2023 December 31, 2022 $ 85,092 $ 70,259 292,986 281,718 $ 378,078 $ 351,977 $ 89,228 $ -	March 31, 2022 $ 62,690 253,804 $ 316,494 $ 92,839

13 -
a. Refer to Note 31 for information relating to investments in financial assets at amortized cost pledged as security.
b. The ranges of interest rates for time deposits with original maturities of more than three months were approximately 1.17%-3.988%, 1.68%-4.125% and 1.68%-4.38% per annum as of March 31, 2023, December 31, 2022 and March 31, 2022, respectively.

10. NOTES RECEIVABLE AND TRADE RECEIVABLES

Notes receivable Notes receivable - operating Less: Allowance for impairment loss Trade receivables At amortized cost Gross carrying amount Less: Allowance for impairment loss	March 31, 2023 December 31, 2022 $ 39,980 $ 32,131 (6) (6) $ 39,974 $ 32,125 $ 2,717,854 $ 3,538,129 (13,514) (13,497) $ 2,704,340 $ 3,524,632	March 31, 2022 $ 7,024 (6) $ 7,018 $ 3,934,584 (13,614) $ 3,920,970

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

The Group measures the loss allowance for trade receivables at an amount equal to lifetime ECLs. The expected credit losses on trade receivables are estimated using a provision matrix prepared by reference to the past default experience of the customer, the customer’s current financial position, economic condition of the industry in which the customer operates, as well as the GDP forecasts and industry outlook. As the Group’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished according to the Group’s different customer base. In addition, a 100% allowance for loss is recognized for accounts receivable when the overdue period exceeds 120 days and for which no other credit guarantee is provided.

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

14 -

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

March 31, 2023

Expected credit loss rate Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost December 31, 2022 Expected credit loss rate Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost March 31, 2021 Expected credit loss rate Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost	Not Past Due 0.47% $ 2,606,135 (12,136) $ 2,593,999 Not Past Due 0.30% $ 3,332,503 (10,032) $ 3,322,471 Not Past Due 0.29% $ 3,600,137 (10,547) $ 3,589,590	1 to 60 Days 61 to 120 Days 121 to 180 Days Over 180 Days 0.30%-3.01% 22.92%-34.39% 100% 100% $ 149,138 $ 2,561 $ - $ - (797) (587) - - $ 148,341 $ 1,974 $ - $ - 1 to 60 Days 61 to 120 Days 121 to 180 Days Over 180 Days 0.27%-2.84% 22.93%-34.39% 100% 100% $ 230,679 $ 7,078 $ - $ - (1,037) (2,434) - - $ 229,642 $ 4,644 $ - $ - 1 to 60 Days 61 to 120 Days 121 to 180 Days Over 180 Days 0.89% 100% 100% 100% $ 341,471 $ - $ - $ - (3,073) - - - $ 338,398 $ - $ - $ -	Total $ 2,757,834 (13,520) $ 2,744,314 Total $ 3,570,260 (13,503) $ 3,556,757 Total $ 3,941,608 (13,620) $ 3,927,988

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

Balance at January 1 Foreign exchange gains and losses Balance at March 31 INVENTORIES Finished goods Work in process Raw materials Supplies and spare parts Merchandise Buildings and land held for sale	March 31, 2023 $ 547,594 420,975 809,745 129,026 551,560 251,697 $ 2,710,597	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 13,503 17 $ 13,520 December 31, 2022 $ 620,212 446,386 769,022 137,716 475,972 250,413 $ 2,699,721	2022 $ 13,494 126 $ 13,620 March 31, 2022 $ 560,819 455,361 688,809 115,419 457,062 475,506 $ 2,752,976

11. INVENTORIES

15 -

The cost of crystal inventories recognized as cost of goods sold for the three months ended March 31, 2023 and 2022 included $1,504,702 thousand and $2,009,598 thousand, respectively. The cost of goods sold for the three months ended March 31, 2023 and 2022 included inventory write-downs of $3,230 thousand and $4,265 thousand, respectively.

The cost of real estate inventories recognized as cost of goods sold for the three months ended March 31, 2023 and 2022 included $0 thousand and $7,892 thousand, respectively.

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

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

Area Jing Yuan Area Jing Yuan Area Jing Yuan	March 31, 2023
	Buildings and Land Held for Sale Contract Liabilities - Current $ 251,697 $ 41 December 31, 2022
	Buildings and Land Held for Sale Contract Liabilities - Current $ 250,413 $ 40 March 31, 2022
	Buildings and Land Held for Sale Contract Liabilities - Current $ 475,506 $ 11,262

12. SUBSIDIARIES

Subsidiary Included in the Consolidated Financial Statements

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

Investor
Investee
Nature of Activities
TXC Corporation
Taiwan Crystal Technology International
Limited
Investment management
TXC Technology, Inc.
Marketing activities
TXC Japan Corporation
Marketing activities
Taiwan Crystal Technology (HK) Limited International trading
TXC Europe GmbH
Marketing activities
Taiwan Crystal
Technology
International Limited
TXC (Ningbo) Corporation
Research and development,
manufacture, and sale of
quartz elements and
related electronic products

Proportion of Ownership
March 31,
2023
December 31,
2022
March 31,
2022
Remark
100
100
100
a
100
100
100
b
100
100
100
c
100
100
100
e
100
100
100
j
100
100
100
d

(Continued)

16 -

Investor
Investee
Nature of Activities
TXC (Ningbo)
Corporation
TXC (Chongqing) Corporation
Research and development,
manufacture, and sale of
quartz elements and
related electronic products
Chongqing Zhongyang Properties Co., Ltd. Properties development
Ningbo Beilun Jingyu Trading Corporation International trading
Ningbo Meishan Free Trade Port Area
Ding Kai Investment Management
Company Limited
Investment management
TETC Corp. NINGBO
Research and development,
manufacture, and sale of
quartz elements and
related electronic products
Chongqing Zhongyang
Properties Co., Ltd.
ChongQing Dingsen Commercial
Management Co., Ltd
Property management
TETC CORP.
NINGBO
Shanghai JCH Co., Ltd (JCH)
Marketing activities and
technical services

Proportion of Ownership
March 31,
2023
December 31,
2022
March 31,
2022
Remark
100
100
100
f
100
100
100
g
100
100
100
h
100
100
100
i
100
100
100
l
100
100
100
k
100
100
-
m
(Concluded)

Remarks:

a. Taiwan Crystal Technology International Limited was incorporated on December 23, 1998 in Samoa.
b. TXC Technology, Inc. was incorporated on December 1, 2000 in California, U.S.A.
c. TXC Japan Corporation was incorporated on September 13, 2005 in Yokohama, Japan.
d. TXC (Ningbo) Corporation was incorporated on March 12, 1999 in Ningbo, China.
e. Taiwan Crystal Technology (HK) Limited was incorporated on July 6, 2010 in Hong Kong Special Administrative Region, China.
f. TXC (Chongqing) Corporation was incorporated on October 11, 2010 in Chongqing, China.
g. Chongqing Zhongyang Properties Co., Ltd. was incorporated on February 14, 2011 in Chongqing, China.
h. Ningbo Beilun Jingyu Trading Corporation was incorporated on September 7, 2011 in Ningbo, China.
i. Ningbo Meishan Free Trade Port Area Ding Kai Investment Management Company Limited was incorporated on May 12, 2017 in Beilun District, Ningbo, China.
j. TXC Europe GmbH was founded in Germany on August 17, 2018.
k. ChongQing Dingsen Commercial Management Co., Ltd. was incorporated on February 21, 2019 in Chongqing, China.
l. TETC Corp. Ningbo was incorporated on December 30, 2020 in Ningbo, China.
m. Shanghai JCH Co., Ltd was registered on October 13, 2022 in Shanghai, China.
n. Except for the financial statements for the three months ended March 31, 2023 and 2022 of Taiwan Crystal Technology International Limited, TXC (Ningbo) Corporation, TXC (Chongqing) Corporation, and Chongqing Zhongyang Properties Co., Ltd., all company are immaterial subsidiaries, and their financial statements have not been reviewed.
17 -

13. NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE

March 31, 2023 December 31 2022 Domestic investments Unlisted shares Godsmith Sensor Inc. $ - $ -	March 31 2022 $ 4,985

In November 2020, the Company’s board of directors approved to dispose of 24% shares of Godsmith Sensor Inc. and expected to complete the sale within twelve months. Accordingly, the Company has reclassified Godsmith Sensor Inc. as non-current assets held for sale, and were presented separately in the accompanying balance sheets.

For the three months ended March 31, 2022, the Group had sold 100 thousand shares in Godsmith Sensor Inc. at fair value of $1,745 thousand and were recognized as loss on disposal $249 thousand.

As of December 31, 2022, the Group still held 250 thousand shares. The financial assets were assessed to no longer meet the definition of non-current assets held for sale and therefore reclassified as financial assets at FVTOCI on the consolidated balance sheet.

14. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

Investments in associates and joint ventures a. Investment in associates Associates that are not individually material The Group’s share of: Profit from continuing operations Other comprehensive income Total comprehensive income for the period	March 31, 2023 $ 468,019 March 31, 2023 $ 405,862	December 31, 2022 March 31, 2022 $ 458,607 $ 443,625 December 31, 2022 March 31, 2022 $ 401,707 $ 404,042 For the Three Months Ended March 31	December 31, 2022 March 31, 2022 $ 458,607 $ 443,625 December 31, 2022 March 31, 2022 $ 401,707 $ 404,042 For the Three Months Ended March 31	December 31, 2022 March 31, 2022 $ 458,607 $ 443,625 December 31, 2022 March 31, 2022 $ 401,707 $ 404,042 For the Three Months Ended March 31
			2023 $ 3,503 653 $ 4,156	2022 $ 4,298 8,530 $ 12,828

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.

18 -

b. Investment joint ventures

March 31, 2023 Joint ventures that are not individually material $ 62,157 The Group’s share of: Loss from continuing operations Total comprehensive loss for the period	December 31, 2022 March 31, 2022 $ 56,900 $ 39,583 For the Three Months Ended March 31	December 31, 2022 March 31, 2022 $ 56,900 $ 39,583 For the Three Months Ended March 31	December 31, 2022 March 31, 2022 $ 56,900 $ 39,583 For the Three Months Ended March 31
		2023 $ (3,374) $ (3,374)	2022 $ (1,937) $ (1,937)

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

Except for investments of Ningbo Longying Semiconductor Co., Ltd., which were accounted for using the equity method and the share of profit or loss and other comprehensive income of those investments were calculated based on financial statements which have been reviewed. Management believes there is no material impact on the equity method of accounting or the calculation of the share of profit or loss and other comprehensive income from the financial statements of Ningbo Longying Semiconductor Co., Ltd. which have not been reviewed.

15. PROPERTY, PLANT AND EQUIPMENT

Cost Balance at January 1, 2022 Additions Disposals Transfer from investment properties Transfer from prepayments for equipment Effects of foreign currency exchange differences Balance at March 31, 2022 Accumulated depreciation and impairment Balance at January 1, 2022 Disposals Depreciation expense Impairment losses Transfer from investment properties Effects of foreign currency exchange differences Balance at March 31, 2022 Carrying value at March 31, 2022	Freehold Land $ 621,855 - - - - - $ 621,855 $ - - - - - - $ - $ 621,855	Land Improvements $ 2,279 270 - - - - $ 2,549 $ 1,209 - 93 - - - $ 1,302 $ 1,247	Buildings Machinery and Equipment Transportation Equipment $ 2,728,943 $ 9,699,052 $ 21,149 5,202 288,613 - - (5,070 ) - 5,903 - - - 200,793 - 43,008 214,724 722 $ 2,783,056 $ 10,398,112 $ 21,871 $ 1,211,106 $ 6,157,842 $ 15,109 - (4,895 ) - 34,976 238,588 706 - 5 - 3,652 - - 22,432 123,687 524 $ 1,272,166 $ 6,515,227 $ 16,339 $ 1,510,890 $ 3,882,885 $ 5,532	Office Equipment $ 387,266 26,704 (6,821 ) - - 10,257 $ 417,406 $ 244,587 (6,794 ) 10,540 - - 5,545 $ 253,878 $ 163,528	Property in Construction Total $ 13,137 $ 13,473,681 617 321,406 - (11,891 ) - 5,903 - 200,793 497 269,208 $ 14,251 $ 14,259,100 $ - $ 7,629,853 - (11,689 ) - 284,903 - 5 - 3,652 - 152,188 $ - $ 8,058,912 $ 14,251 $ 6,200,188 (Continued)

19 -

Cost Balance at January 1, 2023 Additions Disposals Reclassified as intangible assets Reclassified Effects of foreign currency exchange differences Balance at March 31, 2023 Accumulated depreciation and impairment Balance at January 1, 2023 Disposals Depreciation expense Impairment losses Reclassified Effects of foreign currency exchange differences Balance at March 31, 2023 Carrying value at December 31, 2022 and January 1, 2023 Carrying value at March 31, 2023	Freehold Land $ 621,855 - - - - - $ 621,855 $ - - - - - - $ - $ 621,855 $ 621,855	Land Improvements $ 3,024 - - - - - $ 3,024 $ 1,581 - 79 - - - $ 1,660 $ 1,443 $ 1,364	Buildings Machinery and Equipment Transportation Equipment $ 2,781,991 $ 11,127,318 $ 24,354 4,522 46,716 - - (1,888 ) - - - - - (892 ) - 6,099 33,161 117 $ 2,792,612 $ 11,204,415 $ 24,471 $ 1,353,707 $ 7,111,880 $ 17,137 - (1,888 ) - 34,687 258,379 800 - 1,819 - - (81 ) - 3,073 19,275 78 $ 1,391,467 $ 7,389,384 $ 18,015 $ 1,428,284 $ 4,015,438 $ 7,217 $ 1,401,145 $ 3,815,031 $ 6,456	Office Equipment $ 427,331 5,258 (1,752 ) - 1,074 1,383 $ 433,294 $ 279,406 (1,715 ) 12,264 - 81 717 $ 290,753 $ 147,925 $ 142,541	Property in Construction Total $ 97,580 $ 15,083,453 96,756 153,252 - (3,640 ) (1,314 ) (1,314 ) (182 ) - 202 40,962 $ 193,042 $ 15,272,713 $ - $ 8,763,711 - (3,603 ) - 306,209 - 1,819 - - - 23,143 $ - $ 9,091,279 $ 97,580 $ 6,319,742 $ 193,042 $ 6,181,434 (Concluded)

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

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

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

16. LEASE ARRANGEMENTS

a. Right-of-use assets

Carrying amounts Land Buildings Transportation equipment	March 31, 2023 December 31, 2022 $ 199,406 $ 199,547 5,082 5,727 598 710 $ 205,086 $ 205,984	March 31, 2022 $ 207,601 5,890 1,047 $ 214,538

20 -

Additions to right-of-use assets Depreciation charge for right-of-use assets Land Buildings Transportation equipment	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ - $ 1,167 654 113 $ 1,934	2022 $ - $ 1,158 654 113 $ 1,925

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

b. Lease liabilities

	March 31,	March 31,	December 31,	December 31,	March 31,	March 31,
		2023		2022		2022
Carrying amounts
Current	$	3,098	$	3,088	$	3,061
Non-current		2,630		3,399		3,916
	$	5,728	$	6,487	$	6,977
Range of discount rate for lease liabilities was as follows:
	March 31,		December 31,		March 31,
		2023		2022		2022
Buildings	0.86%-1.27%		0.86%-1.27%		0.86%-1.27%
Transportation equipment		0.86%		0.86%		0.86%

c. Material lease-in activities and terms

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

d. Other lease information

Expenses relating to short-term leases Total cash outflow for leases	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 55 $ (824)	2022 $ 55 $ (814)

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

21 -

17. INVESTMENT PROPERTIES

	Completed
	Investment
	Properties
Cost
Balance at January 1, 2022	$ 544,232
Transfer to property, plant and equipment	(5,903)
Effects of foreign currency exchange differences	18,831
Balance at March 31, 2022	$ 557,160
Accumulated depreciation and impairment
Balance at January 1, 2022	$ (49,864)
Depreciation expense	(4,823)
Transfer to property, plant and equipment	3,652
Effects of foreign currency exchange differences	(1,525)
Balance at March 31, 2022	$ (52,560)
Carrying amounts at March 31, 2022	$ 504,600
Cost
Balance at January 1, 2023	$ 637,330
Effects of foreign currency exchange differences	3,120
Balance at March 31, 2023	$ 640,450
Accumulated depreciation and impairment
Balance at January 1, 2023	$ (65,984)
Depreciation expense	(4,007)
Effect of foreign currency exchange differences	(275)
Balance at March 31, 2023	$ (70,266)
Carrying amounts at March 31, 2023	$ 570,184

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

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

The fair value of the Group’s investment properties as of March 31, 2023, December 31, 2022 and March 31, 2022 was $1,094,069 thousand, $1,085,198 thousand and $1,180,496 thousand, respectively. The fair value valuation had not been performed by independent qualified professional valuers; however, management of the Group used the valuation model that market participants would use in determining the fair value. The valuation was arrived at by reference to market evidence of transaction prices for similar properties.

22 -

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

18. BORROWINGS

a. Short-term borrowings

Secured borrowings (Note 31) Bank loans Unsecured borrowings Bank loans Letters of credit	March 31, 2023 December 31, 2022 $ 43,875 $ 43,651 266,692 359,869 44,318 110,230 311,010 470,099 $ 354,885 $ 513,750	March 31, 2022 $ 135,261 621,379 67,631 689,010 $ 824,271

The interest rate on the bank loans and letters of credit were 2.45%-3.65%, 1.2%-3.65% and 2.65%-3.85% per annum as of March 31, 2023, December 31, 2022 and March 31, 2022, respectively.

b. Short-term bills payable

	March 31,	March 31,	December	December	31,	March 31,
		2023		2022		2022
Bank acceptances	$	-	$		-	$ 90,174

Outstanding short-term bills payable were as follows:

March 31, 2022

Promissory Institution Bank acceptances Bank of Ningbo	Nominal Amount RMB 20,000	Discount Amount $ -	Carrying Amount Interest Rate Collateral $ 90,174 3.6% -	Carrying Amount of Collateral $ -

23 -

c. Long-term borrowings

March 31,
2023

Secured borrowings (Note 31)

Bank loans
$ 124,144

Unsecured borrowings
Bank loans
2,218,212
Less: Current portion

(910,813)

1,307,399

Long-term borrowings
$ 1,431,543

The borrowings of the Group were as follows:
Detail of Borrowing
Unsecured bank borrowing
denominated in NT$ Maturity date: 2025.01.03
Principle is paid monthly since January 15, 2021

Unsecured bank borrowing
denominated in NT$ Maturity date: 2025.01.03
Principle is paid monthly since January 15, 2021
Unsecured bank borrowing
denominated in NT$ Maturity date: 2025.01.03
Principle is paid monthly since January 15, 2021
Unsecured bank borrowing
denominated in NT$ Maturity date: 2025.04.01
Principle is paid monthly since March 15, 2023
Unsecured bank borrowing
denominated in NT$ Maturity date: 2025.04.15
Principle is paid monthly since May 15, 2023
Unsecured bank borrowing
denominated in NT$ Maturity date: 2024.09.15
Principle is paid monthly since September 15, 2022
Unsecured bank borrowing
denominated in NT$ Maturity date: 2024.09.15
Principle is paid monthly since September 15, 2022
Unsecured bank borrowing
denominated in NT$ Maturity date: 2024.09.15
Principle is paid monthly since September 15, 2022
Unsecured bank borrowing
denominated in NT$ Maturity date: 2025.01.03
Principle is paid monthly since March 15, 2021
Unsecured bank borrowing
denominated in NT$ Maturity date: 2026.08.17
Principle is paid monthly since September 15, 2022
Unsecured bank borrowing
denominated in NT$ Maturity date: 2023.09.06
Principle is repaid at maturity
Unsecured bank borrowing
denominated in US$ Maturity date: 2023.09.24
Principle is repaid at maturity
Unsecured bank borrowing
denominated in NT$ Maturity date: 2024.08.03
Principle is repaid at maturity
Unsecured bank borrowing
denominated in NT$ Maturity date: 2024.08.03
Principle is repaid at maturity
Unsecured bank borrowing
denominated in NT$ Maturity date: 2024.08.03
Principle is repaid at maturity
Secured bank borrowing
denominated in RMB
Maturity date: 2027.11.01
Principle is repaid semi-annually per agreement of RMB250
thousand, from April 19, 2024 to April 19, 2026; per agreement
of RMB500 thousand, from April 19, 2026 to the maturity date.
Unsecured bank borrowing
denominated in RMB
Maturity date: 2023.08.31
Principle is repaid semi-annually per agreement of RMB100
thousand, from November 30, 2022 to the maturity date.
Unsecured bank borrowing
denominated in RMB
Maturity date: 2023.09.08
Principle is repaid semi-annually per agreement of RMB100
thousand, from December 8, 2022 to the maturity date.
Unsecured bank borrowing
denominated in RMB
Maturity date: 2023.11.01
Principle is repaid semi-annually per agreement of RMB500
thousand, from February 1, 2023 to the maturity date.
Unsecured bank borrowing
denominated in RMB
Maturity date: 2023.11.08
Principle is repaid semi-annually per agreement of RMB500
thousand, from February 8, 2023 to the maturity date.
Less: Current portions

December 31,
2022
March 31,
2022

$ 39,180
$ -
2,374,205
1,883,983

(890,785)

(335,253)

1,483,420

1,548,730
$ 1,522,600
$ 1,548,730
March 31,
2023
December 31,
2022
March 31,
2022
$ 43,750
$ 50,000
$ 68,750
65,625
75,000
103,125
65,625
75,000
103,125
288,000
300,000
300,000
200,000
200,000
200,000
144,000
168,000
200,000
216,000
252,000
300,000
72,000
84,000
100,000
45,652
52,174
71,739
170,833
183,333
200,000
-
-
180,000
36,545
61,417
57,244
100,000
100,000
-
300,000
300,000
-
300,000
300,000
-
124,144
39,180
-
43,432
43,210
-
43,432
43,210
-
41,659
43,651
-
41,659
43,210
-

(910,813)

(890,785)

(335,253)
$ 1,431,543
$ 1,522,600
$ 1,548,730

The range of interest rate on bank loans was 0.85%-5.61%, 0.725%-5.49%, and 0.10%-1.36% per annum as of March 31, 2023, December 31, 2022 and March 31, 2022, respectively.

24 -

19. BONDS PAYABLE

Unsecured domestic convertible bonds Less: Discount on bonds payable	March 31, 2023 December 31, 2022 $ 1,200,000 $ 1,200,000 (14,111) (16,727) $ 1,185,889 $ 1,183,273	March 31, 2022 $ 1,200,000 (24,686) $ 1,175,314

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 $122.9 per share starting from July 23, 2022.

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

Proceeds from issuance (less transaction costs of $5,427 thousand)

Equity component (less transaction costs allocated to the equity component of $129
thousand)
Assets component

Liability component at the date of issue (less transaction costs allocated to the liability
component of $5,298 thousand)

Liability component at December 31, 2021
Interest charged at an effective interest rate

Liability component at March 31, 2022

Liability component at December 31, 2022

Interest charged at an effective interest rate

Liability component at March 31, 2023

$ 1,194,573
(28,431)

2,040
$ 1,168,182
1,172,721

2,593
$ 1,175,314
$ 1,183,273

2,616
$ 1,185,889

20. OTHER LIABILITIES

	March 31,	March 31,	December 31,	December 31,	March 31,	March 31,
		2023		2022		2022
Current
Other payables
Payables for compensations to employees and
directors	$	432,443	$	393,658	$	504,924
Payables for commission		27,030		25,232		27,931
Payables for salaries		85,927		147,661		149,930
Payables for bonus		116,172		506,933		154,641
						(Continued)

25 -

Payables for annual leave Payables for purchase of equipment Others Deferred revenue Arising from government grants (Note 27) Non-current Deferred revenue Arising from government grants (Note 27)	March 31, 2023 December 31, 2022 $ 45,344 $ 47,364 46,428 138,135 133,912 162,996 $ 887,256 $ 1,421,979 $ 38,152 $ 38,817 $ 99,207 $ 108,191	March 31, 2022 $ 43,425 104,842 165,667 $ 1,151,360 $ 24,589 $ 67,228 (Concluded)

21. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

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

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

b. Defined benefit plans

Employee benefit expense for the three months ended March 31, 2023 and 2022 were $343 thousand and $421 thousand, respectively. Employee benefit expense was calculated on the basis of the actuarial valuations in December 31, 2022 and 2021.

22. EQUITY

a. Share capital

Ordinary shares

Numbers of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued	March 31, 2023 December 31, 2022 500,000 500,000 $ 5,000,000 $ 5,000,000 309,757 309,757 $ 3,097,570 $ 3,097,570	March 31, 2022 500,000 $ 5,000,000 309,757 $ 3,097,570

26 -

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 Others May not be used for any purpose Employee share options	March 31, 2023 December 31, 2022 $ 611,776 $ 611,776 977,028 977,028 73,377 73,377 331 331 23,981 15,627 3,702 3,409 28,431 28,431 $ 1,718,626 $ 1,709,979	March 31, 2022 $ 611,776 977,028 73,377 331 2,712 3,412 28,431 $ 1,697,067

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

c. Retained earnings and dividends policy

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

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

27 -

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

Items referred to under Rule No. 1010012865, Rule No. 1010047490 and Rule No. 1030006415 issued by the FSC and in the directive titled “Questions and Answers for Special Reserves Appropriated Following Adoption of IFRSs” should be appropriated to or reversed from a special reserve by the Company.

The appropriations of earnings for 2022 and 2021 that were proposed by the board of directors on March 6, 2023 and approved by the shareholders in their meeting on May 31, 2022, respectively, were as follows:

Legal reserve Special reserve Cash dividends	Appropriation of Earnings For Fiscal Year 2022 For Fiscal Year 2021 $ 296,435 $ 310,870 143,070 (346,761) 2,168,299 2,323,178	Dividends Per Share (NT$)
		For Fiscal Year 2022 For Fiscal Year 2021 $ - $ - - - 7.0 7.5

The appropriation of earnings for 2022 is subject to the resolution of the shareholders’ meeting to be held on May 30, 2023.

d. Other equity items

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

Balance at January 1 Exchange differences on translating the financial statements of foreign operations Share of exchange differences of associates accounted for using the equity method Balance at March 31	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ (450,523) 34,243 653 $ (415,627)	2022 $ (559,579) 247,684 8,530 $ (303,365)

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

Balance at January 1 Recognized during the period Unrealized gain (loss) - equity instruments Other comprehensive income (loss) recognized in the period Cumulative unrealized loss of equity instruments transferred to retained earnings due to disposal Balance at March 31		For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 307,453 26,943 26,943 (31,660) $ 302,736	2022 $ 1,357,362 (445,887) (445,887) (104,518) $ 806,957

28 -

23. REVENUE

Revenue from contracts with customers Revenue from sale of goods Construction contract revenue		For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 2,295,712 2,276 $ 2,297,988	2022 $ 3,205,109 11,458 $ 3,216,567

Contract Balances

Trade receivables (Note 10) Contract liabilities Construction of properties Sale of goods	March 31, 2023 December 31, 2022 $ 2,704,340 $ 3,524,632 $ 41 $ 40 13,282 12,116 $ 13,323 $ 12,156	March 31, 2022 $ 3,920,970 $ 11,262 11,243 $ 22,505	January 1, 2022 $ 4,035,315 $ 10,814 15,654 $ 26,468

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

24. NET PROFIT FROM CONTINUING OPERATIONS

a. Interest income

Bank deposits Financial assets at amortized cost Others	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 9,662 2,464 3,304 $ 15,430	2022 $ 1,175 2,432 627 $ 4,234

b. Other income

Income from government grants Others	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 24,037 6,870 $ 30,907	2022 $ 17,204 9,663 $ 26,867

29 -

c. Other gains and losses

For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
2023 2022 $ - $ (249) (36) 294 9,635 (339) (32,096) 128,903 (1,819) (5) (4,007) (4,823) 652 (2,315) $ (27,671) $ 121,466 For the Three Months Ended March 31
2023 2022 $ 10,528 $ 8,356 2,616 2,593 13 22 $ 13,157 $ 10,971 For the Three Months Ended March 31
	2023 $ 306,209 4,007 1,934 3,584 $ 315,734 $ 234,165 73,978 4,007 $ 312,150 $ 35 3,549 $ 3,584	2022 $ 284,903 4,823 1,925 5,252 $ 296,903 $ 230,402 56,426 4,823 $ 291,651 $ 5,252 - $ 5,252

30 -

f. Employee benefits expense

Post-employment benefits (see Note 21) Defined contribution plans Defined benefit plans Other employee benefits Payroll expense Labor and health insurance Others An analysis of employee benefits expense by function Operating costs Operating expenses	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 27,405 343 27,748 515,244 38,014 22,511 575,769 $ 603,517 $ 358,746 244,771 $ 603,517	2022 $ 29,320 421 29,741 672,650 34,595 18,765 726,010 $ 755,751 $ 400,365 355,386 $ 755,751

g. Employees’ compensation and remuneration of directors

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 three months ended March 31, 2023 and 2022, respectively, were as follows:

Accrual rate

Employees’ compensation Remuneration of directors Amount	For the Three Months Ended March 31
	2023 2022 9.0% 9.0% 1.5% 1.5%

Employees’ compensation Remuneration of directors	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 33,244 $ 5,541	2022 $ 78,566 $ 13,094

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

31 -

The employees’ compensation and remuneration of directors for the years ended December 31, 2022 and 2021 which were approved by the Company’s board of directors on March 6, 2023 and March 7, 2022, respectively, were as follows:

Employees’ compensation Remuneration of directors	For the Year Ended December 31	For the Year Ended December 31
	2022 Cash Share $ 330,344 $ - 55,057 -	2021
		Cash Share $ 354,226 $ - 59,038 -

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

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

25. INCOME TAXES RELATING TO CONTINUING OPERATIONS

a. Major components of tax expense recognized in profit or loss

The major components of tax expense were as follows:

Current tax In respect of the current year Deferred tax In respect of the current year Income tax expense recognized in profit or loss	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 39,629 24,673 $ 64,302	2022 $ 111,239 29,830 $ 141,069

b. Income tax assessments

The income tax returns through 2020 had been assessed by the tax authorities.

26. EARNINGS PER SHARE

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

Net Profit for the Period

Profit for the period attributable to owners of the Company Interest on convertible bonds after tax Earnings used in the computation of diluted earnings per share	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 286,770 2,093 $ 288,863	2022 $ 670,337 2,074 $ 672,411

32 -

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

Weighted average number of ordinary shares in computation of basic earnings per share Effect of dilutive potential ordinary shares: Convertible bonds Employees’ compensation Weighted average number of ordinary shares used in the computation of diluted earnings per share	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 309,757 9,764 3,064 322,585	2022 309,757 8,975 3,425 322,157

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

27. GOVERNMENT GRANTS

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

28. CAPITAL MANAGEMENT

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

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

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

29. FINANCIAL INSTRUMENTS

a. Fair value of financial instruments

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

33 -
b. Fair value of financial instruments that are measured at fair value on a recurring basis
1) Fair value hierarchy

March 31, 2023

Financial assets at FVTPL Foreign exchange forward contracts and exchange contracts Mutual funds Structured deposits Financial assets at FVTOCI Domestic listed shares Domestic emerging shares Domestic unlisted shares Foreign unlisted shares December 31, 2022 Financial assets at FVTPL Domestic listed shares Foreign exchange forward contracts and exchange contracts Mutual funds Structured deposits Financial liabilities at FVTPL Foreign exchange forward contracts and exchange contracts Financial assets at FVTOCI Domestic listed shares Domestic unlisted shares Foreign unlisted shares	Level 1 $ - 290 - $ 290 $ 303,048 136,833 - - $ 439,881 Level 1 $ 20,350 - 287 - $ 20,637 $ - $ 262,122 - - $ 262,122	Level 2 $ 2,805 - 404,299 $ 407,104 $ - - - - $ - Level 2 $ - 3,662 - 393,151 $ 396,813 $ 13,620 $ - - - $ -	Level 3 $ - - - $ - $ - - 22,291 188,200 $ 210,491 Level 3 $ - - - - $ - $ - $ - 213,170 187,241 $ 400,411	Total $ 2,805 290 404,299 $ 407,394 $ 303,048 136,833 22,291 188,200 $ 650,372 Total $ 20,350 3,662 287 393,151 $ 417,450 $ 13,620 $ 262,122 213,170 187,241 $ 662,533

34 -

March 31, 2022

Financial assets at FVTPL Domestic listed shares Redemption options on convertible bonds Foreign exchange forward contracts and exchange contracts Mutual funds Structured deposits Financial assets at FVTOCI Domestic listed shares Domestic unlisted shares Foreign unlisted shares Financial liabilities at FVTPL Foreign exchange forward contracts and exchange contracts	Level 1 $ 13,500 - - 109,696 - $ 123,196 $ 835,660 - - $ 835,660 $ -	Level 2 $ - 600 484 - 441,387 $ 442,471 $ - - - $ - $ 6,801	Level 3 $ - - - - - $ - $ - 87,740 241,934 $ 329,674 $ -	Total $ 13,500 600 484 109,696 441,387 $ 565,667 $ 835,660 87,740 241,934 $ 1,165,334 $ 6,801

For the three month ended March 31, 2023 and 2022, there were no transfer between Level 1 and Level 2.

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

For the three months ended March 31, 2023

Financial Assets Balance at January 1, 2022 Transfer to Level 1 Effects of foreign currency exchange differences Balance at March 31, 2022	Financial Assets at FVTPL Equity Instruments $ - - - $ -	Financial Assets at FVTOCI
		Equity Instruments $ 400,411 (190,880) 960 $ 210,491

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.

35 -

For the three months ended March 31, 2022

Financial Assets Balance at January 1, 2022 Purchase Recognized in other comprehensive income Effects of foreign currency exchange differences Balance at March 31, 2022	Financial Assets at FVTPL Equity Instruments $ - - - - $ -	Financial Assets at FVTOCI
		Equity Instruments $ 310,824 10,000 274 8,576 $ 329,674

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
Structured deposits
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.
Discounted cash flow.
Future cash flows are discounted at a rate that reflects current
borrowing interest rates of the bond issuers at the end of the
reporting period
Binomial tree valuation model.
Binomial tree valuation model were evaluated by the observable
closing price of the stocks, volatility, risk-free interest rate,
risk discount rate, and liquidity risk at the balance sheet date.

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

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

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

36 -

c. Categories of financial instruments

	March 31,	March 31,	December 31,	December 31,	March 31,	March 31,
		2023		2022		2022
Financial assets
FVTPL
Mandatorily at FVTPL (1)	$	407,394	$	417,450	$	565,667
Financial assets at amortized cost (2)		7,692,328		8,223,316		8,497,813
Financial assets at FVTOCI
Equity instruments		650,372		662,533		1,165,334
Financial liabilities
FVTPL
Mandatorily at FVTPL (3)		-		13,620		6,801
Amortized cost (4)		5,860,636		6,814,283		6,924,999

1) The balances included the carrying amount of beneficiary certificate, foreign exchange forward contracts and exchange contracts, structured deposits, redemption options on convertible bonds, and equity instrument investments.
2) The balances include financial assets measured at amortized cost, which comprise cash and cash equivalents, notes receivable, trade receivables, other receivables and refundable deposits.
3) The balances included the carrying amount of foreign exchange forward contracts and exchange contracts.
4) The balances included financial liabilities measured at amortized cost, which comprise short-term and long-term loans, short-term bills payable, bonds payable, notes payable, trade payables, other payables and guarantee deposits received.
d. Financial risk management objectives and policies

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

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

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

37 -

1) Market risk

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

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

a) Foreign currency risk

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

The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities (including those eliminated on consolidation) at the end of the reporting period (see Note 33).

Sensitivity analysis

The Group was mainly exposed to the USD and JPY.

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

Profit or loss	USD Impact For the Three Months Ended March 31 2023 2022 $ 35,607 $ 44,130	JPY Impact
		For the Three Months Ended March 31
		2023 2022 $ (2,728) $ (1,492)

i. This was mainly attributable to the exposure outstanding on USD monetary items, which were not hedged at the end of the reporting period.
ii. This was mainly attributable to the exposure to outstanding JPY monetary items, which were not hedged, at the end of the reporting period.
38 -

b) Interest rate risk

The Group was exposed to interest rate risk because the Group’s bank deposits and the Group borrowed funds at floating interest rates.

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

	March 31,	March 31,	December 31,	March 31,	March 31,
		2023	2022		2022
Fair value interest rate risk
Financial assets	$	1,202,966	$ 1,164,521	$	1,014,109
Financial liabilities		3,291,645	3,474,901		2,989,759
Cash flow interest rate risk
Financial assets		3,719,518	3,408,887		3,479,707
Financial liabilities		591,485	635,507		983,983

Sensitivity analysis

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

If interest rates had been 25 basis points higher/lower and all other variables were held constant, the Group’s pre-tax profit for the three months ended March 31, 2023 and 2022 would increase by $1,955 thousand and $1,560 thousand, which was mainly attributable to the Group’s exposure to interest rates on its floating rate bank deposits and bank borrowings.

2) Credit risk

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

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

3) Liquidity risk

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

39 -

The Group relies on bank borrowings as a significant source of liquidity. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Group had available unutilized short-term bank loan facilities of approximately $7,036,193 thousand, $6,774,251 thousand and $7,041,760 thousand, respectively.

Liquidity and interest risk rate tables

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

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

March 31, 2023

	Weighted
	Interest
	Average
	Effective Rate	Less Than
	(%)	1 Year		2-3 Years		4-5 Years		5+ Years			Total
Non-derivative financial
liabilities
Trade payables	-	$ 1,013,760	$	-	$	-	$			-	$ 1,013,760
Other payables	-	887,655		-		-				-	887,655
Lease liabilities	0.86-1.27	3,098		2,630		-				-	5,728
Variable interest rate
liabilities	0.85-0.975	272,087		298,565		20,833				-	591,485
Fixed interest rate
liabilities	0.9-5.61	993,611		2,173,888		124,146				-	3,291,645
December 31, 2022
	Weighted
	Interest
	Average
	Effective Rate	Less Than
	(%)	1 Year		2-3 Years		4-5 Years		5+ Years			Total
Non-derivative financial
liabilities
Trade payables	-	$ 1,209,119	$	-	$	-	$		-		$ 1,209,119
Other payables	-	1,423,229		-		-			-		1,423,229
Lease liabilities	0.86-1.27	3,088		3,399		-			-		6,487
Variable interest rate
liabilities	0.725-0.975	248,087		354,087		33,333			-		635,507
Fixed interest rate
liabilities	0.9-5.49	1,156,448		2,279,272		39,181			-		3,474,901

40 -

March 31, 2022

	Weighted
	Interest
	Average
	Effective Rate	Less Than
	(%)		1 Year	2-3 Years	4-5 Years	5+ Years		Total
Non-derivative financial
liabilities
Trade payables	-	$	1,726,159 $	- $	- $		-	$ 1,726,159
Other payables	-		1,153,174	-	-		-	1,153,174
Other current liabilities	-		28,454	-	-		-	28,454
Lease liabilities	0.86-1.27		3,061	3,916	-		-	6,977
Variable interest rate
liabilities	0.1-0.68		155,253	749,897	78,833		-	983,983
Fixed interest rate
liabilities	0.3-3.85		1,094,445	1,895,314	-		-	2,989,759

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

Liquidity and interest rate risk tables for derivative financial liabilities

The following table detailed the Group’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.

March 31, 2023

On Demand or Less Than 1 Month 1-3 Months 3 Months to 1 Year Net settled Foreign exchange forward contracts and exchange contracts $ 1,741 $ 1,704 $ (641) December 31, 2022 On Demand or Less Than 1 Month 1-3 Months 3 Months to 1 Year Net settled Foreign exchange forward contracts and exchange contracts $ (1,551) $ (9,098) $ 688 March 31, 2022 On Demand or Less Than 1 Month 1-3 Months 3 Months to 1 Year Net settled Foreign exchange forward contracts and exchange contracts $ (2,065) $ (4,259) $ 5	1-5 Years $ - 1-5 Years $ - 1-5 Years $ -	5+ Years $ -
		5+ Years $ -
		5+ Years $ -

41 -

30. RELATED-PARTY TRANSACTIONS

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

a. Related party name and category

Name Relationship with the Group Tai-Shing Electronics Components Corporation Associate TSE Technology (Ningbo) Co., Ltd. Associate EcLife Co., Ltd. Other associate Ningbo Longying Semiconductor Co., Ltd. Other associate

b. Sale of goods

Line Items Related Party Categories Sales Associates Other associates	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 7,256 1,176 $ 8,432	2022 $ 31,670 2,951 $ 34,621

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

c. Purchase of goods

Related Party Categories Other associates	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 118	2022 $ 1,314

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

d. Operating expenses

Related Party Categories Other associates	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 103	2022 $ 526

42 -
e. Commission revenue

Related Party Categories Associates Other associates	For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 $ 377 - $ 377	2022 $ 375 - $ 375

f. Rental income

Related Party Categories Location Rent Collection TSE Technology (Ningbo) Co., Ltd. 1F., No. 189, Huangshan W. Rd., Beilun Dist., Ningbo City Based on contract, and paid on a monthly basis Tai-Shing Electronics Components Corporation 6F., No. 4, Gongye 6th Rd., Pingzhen Dist., Taoyuan City 324, Taiwan (R.O.C.) Based on contract, and paid on a monthly basis Ningbo Longying Semiconductor Co., Ltd. 1F., No. 189, Huangshan W. Rd., Beilun Dist., Ningbo City Based on contract, and paid on a monthly basis		For the Three Months Ended March 31	For the Three Months Ended March 31	For the Three Months Ended March 31
		2023 Amount % to Total Account Balance $ 1,143 - 875 - 44 - $ 2,062		2022
				Amount % to Total Account Balance $ 1,134 - 884 - 44 - $ 2,062

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

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

Related Party Categories Associates Other associates Less: Allowance for impairment loss	March 31, 2023 December 31, 2022 $ 7,611 $ 8,171 1,363 1,748 (68) (68) $ 8,906 $ 9,851	March 31, 2022 $ 34,158 3,747 (68) $ 37,837

The outstanding trade receivables from related parties are unsecured.

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

Related Party Categories Other associates	March 31, 2023 December 31, 2022 $ 90 $ 622	March 31, 2022 $ 132

The outstanding trade payables to related parties are unsecured.

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

43 -
i. Other receivables from related parties

Related Party Categories Associates Other associates j. Other payables to related parties Related Party Categories Associates Other associates k. Prepayments Related Party Categories Other associates	March 31, 2023 December 31, 2022 $ 1 $ 635 4 8 $ 5 $ 643 March 31, 2023 December 31, 2022 $ 95 $ - 304 1,250 $ 399 $ 1,250 March 31, 2023 December 31, 2022 $ 4,318 $ 4,357	March 31, 2022 $ 732 39 $ 771 March 31, 2022 $ - 1,814 $ 1,814 March 31, 2022 $ 3,802

The prepayments were accounted for prepaid equipment.

l. Acquisition of property, plant and equipment

Acquisition Amounts	Acquisition Amounts	Acquisition Amounts
For the Three Months Ended March 31
2023 2022 $ 129 $ 1,200 For the Three Months Ended March 31
	2023 $ 28,331 950 $ 29,281	2022 $ 56,844 962 $ 57,806

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

44 -

31. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets were provided as collateral for bank borrowings:

Building equipment, net Investment property Pledged deposits Right-of-use assets	March 31, 2023 December 31, 2022 $ 237,798 $ 247,376 12,810 13,147 85,092 70,259 10,671 10,710 $ 346,371 $ 341,492	March 31, 2022 $ 286,061 14,679 62,690 11,238 $ 374,668

32. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

In addition to those disclosed in other notes, significant commitments and contingencies of the Group as of March 31, 2023 and 2022 were as follows:

a. As of March 31, 2023, unused letters of credit amounted to approximately JPY11,058 thousand and EUR339 thousand.
b. On November 8, 2021, the board of directors of the Company approved its subsidiary TETC CORP. NINGBO to construct a plant project, with an estimated investment of RMB145,000 thousand. On April 19, 2022, the Company signed a construction contract. The total contract amount divided into paid and unpaid is as follows:

Unit: In Thousands of Foreign Currencies

Property, plant and equipment	Contract Amount RMB 101,880	Paid Amount Unpaid Amount RMB 19,220 RMB 82,660

c. As of March 31, 2022, the Company unrecognized commitments and contingent liabilities are as follows:

Unit: In Thousands of Foreign Currencies and New Taiwan Dollars

Acquisition of equipment Acquisition of equipment Acquisition of equipment Acquisition of equipment	Contract Amount $ 156,510 RMB 36,016 JPY 104,188 USD 1,546	Paid Amount Unpaid Amount $ 81,821 $ 74,689 RMB 10,263 RMB 25,753 JPY 36,850 JPY 67,338 USD 633 USD 913

45 -

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

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

Unit: In Thousands of Foreign Currencies and New Taiwan Dollars

March 31, 2023

		Foreign		Carrying
		Currency	Exchange Rate	Amount
Financial assets
Monetary items
USD	$	117,591	30.4540 (USD:NTD)	$ 3,581,116
USD		5,268	6.8717 (USD:RMB)	160,432
JPY		637,942	0.2288 (JPY:NTD)	145,961
JPY		183,381	0.0516 (JPY:RMB)	41,958
JPY		106,038	0.0075 (JPY:USD)	24,261
Financial liabilities
Monetary items
USD		3,561	30.4540 (USD:NTD)	108,447
USD		2,378	6.8717 (USD:RMB)	72,420
JPY		1,018,749	0.2288 (JPY:NTD)	233,090
JPY		1,058,345	0.0516 (JPY:RMB)	242,149
JPY		42,447	0.0075 (JPY:USD)	9,712
December 31, 2022
		Foreign		Carrying
		Currency	Exchange Rate	Amount
Financial assets
Monetary items
USD	$	139,256	30.7080 (USD:NTD)	$ 4,276,273
USD		4,148	6.9646 (USD:RMB)	127,377
JPY		533,718	0.2324 (JPY:NTD)	124,036
JPY		306,521	0.0527 (JPY:RMB)	71,245
JPY		110,132	0.0076 (JPY:USD)	25,595
Financial liabilities
Monetary items
USD		25,887	30.7080 (USD:NTD)	794,938
USD		8,133	6.9646 (USD:RMB)	249,748
JPY		1,338,747	0.2324 (JPY:NTD)	311,125
JPY		974,054	0.0527 (JPY:RMB)	226,370
JPY		97,085	0.0076 (JPY:USD)	22,563

46 -

March 31, 2022

		Foreign		Carrying
		Currency	Exchange Rate	Amount
Financial assets
Monetary items
USD	$	148,269	28.622 (USD:NTD)	$ 4,243,755
USD		15,146	6.3482 (USD:RMB)	433,509
JPY		940,516	0.2353 (JPY:NTD)	221,303
JPY		681,516	0.0522 (JPY:RMB)	160,361
JPY		329,603	0.0082 (JPY:USD)	77,556
Financial liabilities
Monetary items
USD		8,044	28.622 (USD:NTD)	230,235
USD		1,189	6.3482 (USD:RMB)	34,032
JPY		1,207,984	0.2353 (JPY:NTD)	284,239
JPY		1,127,101	0.0522 (JPY:RMB)	265,207
JPY		250,686	0.0082 (JPY:USD)	58,986

For the three months ended March 31, 2023 and 2022, realized and unrealized net foreign exchange gains (losses) were losses of $32,096 thousand and gains of $128,903 thousand, respectively. It is impractical to disclose net foreign exchange gains (losses) by each significant foreign currency due to the variety of the foreign currency transactions and functional currencies of the group entities.

34. SEPARATELY DISCLOSED ITEMS

a. Information on significant transactions:
1) Lending funds to others. (None)
2) Providing endorsements or guarantees for others. (None)
3) Holding of securities at the end of the period. (Table 1)
4) Aggregate purchases or sales of the same securities reaching NT$300 million or 20 percent of paid-in capital or more. (None)
5) Acquisition of real estate reaching NT$300 million or 20 percent of paid-in capital or more. (None)
6) Disposal of real estate reaching NT$300 million or 20 percent of paid-in capital or more. (None)
7) Purchases or sales of goods from or to related parties reaching NT$100 million or 20 percent of paid-in capital or more. (Table 2)
8) Trade receivables from related parties reaching NT$100 million or 20 percent of paid-in capital or more. (Table 3)
9) Trading in derivative instruments. (Note 7)
47 -
10) Others: The business relationship between the parent and the subsidiaries and between each subsidiary, and the circumstances and amounts of any significant transactions between them. (Table 7)
b. Information on investees (Table 4)
c. Information on investments in mainland China
1) Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, shareholding ratio, investment gain or loss, carrying amount of the investment at the end of the period, repatriated investment gains, and limit on the amount of investment in the mainland China area. (Table 5)
2) Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third area, and their prices, payment terms, and unrealized gains or losses: (Table 6)
- a) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period.
- b) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period.
- c) The amount of property transactions and the amount of the resultant gains or losses.
- d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes.
- e) The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds.
- f) Other transactions that have a material effect on the profit or loss for the period or on the financial position, such as the rendering or receipt of services.
d. Information of major shareholders: List all shareholders with ownership of 5% or greater showing the name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder (None)

35. SEGMENT INFORMATION

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

a. Crystal

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

1) The similar gross profit between the selling units.
2) The similar product’s nature and manufacturing process.
3) The same product’s delivery type.
48 -

b. Real estate development segment

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

Segment revenue and results

Crystal Real estate development segment Continuing operations Interest income Other income Other gains and losses Financial costs Share of profit or loss of associates Profit before tax (continuing operations)	Segment Revenue For the Three Months Ended March 31 2023 2022 $ 2,295,712 $ 3,205,109 2,276 11,458 $ 2,297,988 $ 3,216,567	Segment Revenue For the Three Months Ended March 31 2023 2022 $ 2,295,712 $ 3,205,109 2,276 11,458 $ 2,297,988 $ 3,216,567	Segment Profit	Segment Profit	Segment Profit
			For the Three Months Ended March 31
		2023 $ 2,295,712 2,276 $ 2,297,988		2023 $ 351,002 (5,568) 345,434 15,430 30,907 (27,671) (13,157) 129 $ 351,072	2022 $ 671,302 (3,853) 667,449 4,234 26,867 121,466 (10,971) 2,361 $ 811,406

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

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

49 -

TABLE 1

TXC CORPORATION AND SUBSIDIARIES

MARKETABLE SECURITIES HELD MARCH 31, 2023

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

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account			March 31, 2023	March 31, 2023			Note
				Shares		Carrying Amount	Percentage of Ownership		Fair Value
TXC Corporation TXC (Ningbo) Corporation TXC (Chongqing) Corporation Ningbo Beilun Jingyu Trading Corporation Ningbo Meishan Free Trade Port Area Ding Kai Investment Management Company Limited Chongqing Zhongyang Properties Co., Ltd. ChongQing Dingsen Commercial Management Co., Ltd.	Stock-unlisted company Godsmith Sensor Inc RFIC Technology Corporation Gallopwave Inc. Stock-emerging shares Win Win Precision Technology Co., Ltd. Stock-listed company UPI Semiconductor Corp. Shares overseas-unlisted company Ningbo SJ Electronics Co., Ltd. Structured deposits China Construction Bank Fubon Bank (China) Co., Ltd China CITIC Bank Beneficiary certificate Southern Cash Fund Shares overseas-unlisted company Zhejiang Bright Semiconductor Technology Co., Ltd. Structured deposits Chongqing Rural Commercial Bank Structured deposits China Construction Bank	None TXC Corporation is a director of the Company None ″ ″ None None ″ ″ None None None None	Financial assets at FVTOCI - non-current ″ ″ ″ ″ Financial assets at FVTOCI - non-current Financial assets at FVTPL - current ″ ″ Financial assets at FVTPL - current Financial assets at FVTOCI - non-current Financial assets at FVTPL - current Financial assets at FVTPL - current	800 3,334 5,000 1,625 976 567 RMB 27,600 RMB 2,253 RMB 41,766 RMB 64 7,004 RMB 19,251 RMB 357		$ 4,833 12,009 5,449 136,833 303,048 $ 462,172 $ 55,939 $ 122,316 9,985 185,099 $ 317,400 $ 290 $ 132,261 $ 85,319 $ 1,580	4 12 10 3 1 5 - 3 - -		$ 4,833 12,009 5,449 136,833 303,048 $ 462,172 $ 55,939 $ 122,316 9,985 185,099 $ 317,400 $ 290 $ 132,261 $ 85,319 $ 1,580

50 -

TABLE 2

TXC CORPORATION AND SUBSIDIARIES

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST $100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE THREE MONTHS ENDED MARCH 31, 2023

(In Thousands of New Taiwan Dollars)

Buyer	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts Receivable (Payable)	Notes/Accounts Receivable (Payable)	Note
			Purchases/ Sales	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
TXC Corporation	TXC (Ningbo) Corporation `〃` TXC (Chongqing) Corporation	Subsidiary `〃` `〃`	Purchases Sales Purchases	$ 544,328 136,663 304,707	40 7 23	No significant differences with the third parties. `〃` `〃`	Its trading price depends on its function within the Group `〃` `〃`	No significant differences with the third parties. `〃` `〃`	$ (539,143) 152,320 (304,809)	(42) 6 (24)

51 -

TABLE 3

TXC CORPORATION AND SUBSIDIARIES

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

(In Thousands of New Taiwan Dollars)

Company Name	Related Party	Relationship	Ending Balance	Turnover Rate		Overdue	Amount Received in Subsequent Period	Allowance for Impairment Loss
					Amount	Action Taken
TXC Corporation TXC (Ningbo) Corporation TXC (Chongqing) Corporation	TXC (Ningbo) Corporation TXC Corporation TXC Corporation	Subsidiary Parent entity Parent entity	$ 152,320 539,143 304,809	3.32 3.92 4.20	$ - - -	- - -	$ 22,571 178,260 84,106	$ - - -

Note: The ending balance is primarily consisted of other receivables, which is not applicable for the calculation of turnover rate.

52 -

TABLE 4

TXC CORPORATION AND SUBSIDIARIES

NAMES, LOCATIONS, AND RELATED INFORMATION OF INVESTEES ON WHICH THE COMPANY EXERCISES SIGNIFICANT INFLUENCE FOR THE THREE MONTHS ENDED MARCH 31, 2023

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

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount	Original Investment Amount	Balance as of March 31, 2023	Balance as of March 31, 2023	Balance as of March 31, 2023	Net Income (Losses) of the Investee	Equity in the Earnings (Losses)	Note
				March 31, 2023	December 31, 2022	Shares (In Thousands)	Percentage of Ownership	Carrying Value
TXC Corporation	Taiwan Crystal Technology International Ltd. Taiwan Crystal Technology International (HK) Limited TXC Japan Corporation TXC Technology Inc. Tai-Shing Electronics Components Corporation TXC Europe GmbH	Western Samoa Hong Kong Japan U.S.A. Taiwan Germany	Investment management International trading Marketing activities Marketing activities Manufacture and sales of electronics products Marketing activities	$ 1,390,461 2,371 6,172 9,879 373,432 1,746	$ 1,390,461 2,371 6,172 9,879 373,432 1,746	42,835 2,371 6,172 9,879 8,802 1,746	100.00 100.00 100.00 100.00 33.34 100.00	$ 7,247,796 189,499 32,277 22,655 405,862 10,704	$ 131,480 (1,167) 1,046 1,008 10,506 1,560	$ 112,309 (1,167) 1,046 1,008 3,503 1,560

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TABLE 5

TXC CORPORATION AND SUBSIDIARIES

INFORMATION ON INVESTMENT IN MAINLAND CHINA FOR THE THREE MONTHS ENDED MARCH 31, 2023 (In Thousands of New Taiwan Dollars)

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

Investee Company	Main Businesses and Products	Main Businesses and Products	Paid-in Capital	Method of Investment	Method of Investment	Accumulated Outflow of Investments from Taiwan as of January 1, 2023	Investment Flows	Investment Flows	Accumulated Outflow of Investments from Taiwan as of March 31, 2023	Investee Company Current Net Income (Loss)	Percentage of Ownership	Investment Income (Loss) Recognized	Carrying Amount as of March 31, 2023	Accumulated Inward Remittance of Earnings as of March 31, 2023
							Outflow	Inflow
TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO Chongqing Zhongyang Properties Co., Ltd. Ningbo Beilun Jingyu Trading Corporation Ningbo Longying Semiconductor Co., Ltd. Ningbo Meishan Free Trade Port Area Ding Kai Investment Management Company Limited ChongQing Dingsen Commercial Management Co., Ltd. Shanghai JCH Co., Ltd	Research and development, manufacture, and sale of quartz elements and related electronic products Research and development, manufacture, and sale of quartz elements and related electronic products Research and development, manufacture, and sale of quartz elements and related electronic products Properties development International trading Research and development in integrated circuit Investment management Property management Marketing activities and Technical Services		$ 2,350,052 1,162,074 433,440 684,908 7,090 246,257 160,043 4,390 2,238	Indirect investment of the Corporation in mainland China through the Corporation’s subsidiary in a third region Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China Other investment of the Corporation in mainland China		$ 1,427,630 - - - - - - - -	$ - - - - - - - - -	$ - - - - - - - - -	$ 1,427,630 - - - - - - - -	$ 131,490 25,928 43,354 (5,050) 1 (10,936) - (577) (3,690)	100.00 100.00 100.00 100.00 100.00 29.37 100.00 100.00 100.00	$ 131,490 25,928 43,354 (5,050) 1 (3,374) - (577) (3,690)	$ 7,325,243 1,681,996 986,645 812,572 6,243 62,157 132,533 (1,803) (1,390)	$ 1,039,001 306,500 - - - - - - -

Accumulated Outward Remittance for Investments in mainland China as of March 31, 2023		Investment Amounts Authorized by the Investments Commission, MOEA			Upper Limit on the Amount of Investments Stipulated by Investment Commission, MOEA
$ 1,427,630		$ 2,350,052			$ -

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.

54 -

TABLE 6

TXC CORPORATION AND SUBSIDIARIES

SIGNIFICANT TRANSACTIONS WITH INVESTEE COMPANIES IN MAINLAND CHINA, EITHER DIRECTLY OR INDIRECTLY THROUGH A THIRD PARTY, AND THEIR PRICES, PAYMENT TERMS, AND UNREALIZED GAINS OR LOSSES

FOR THE THREE MONTHS ENDED MARCH 31, 2023 (In Thousands of New Taiwan Dollars)

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	Accounts/Notes Receivable/Payable	Accounts/Notes Receivable/Payable	Unrealized Gain	Note
			Amount	%		Payment Term	Comparison with Normal Transaction	Ending Balance	%
TXC Corporation	TXC (Ningbo) Corporation TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO	Purchases Sales Purchases Purchases	$ 544,328 136,663 304,707 94,151	40 7 23 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 `〃` `〃` `〃`	$ (539,143) 152,320 (304,809) (93,690)	(42) 6 (24) (7)	$ 46,993 10,216 17,643 3,463

The transactions of properties and the profit or loss: None.
Endorsements guarantees or collateral directly or indirectly provided to the investees: None.
Financing directly or indirectly provided to the investees: None.
Other transactions that significantly impacted the current year’s profit or loss or financial position: None.
55 -

TABLE 7

TXC CORPORATION AND SUBSIDIARIES

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT INTERCOMPANY TRANSACTIONS FOR THE THREE MONTHS ENDED MARCH 31, 2023

(In Thousands of New Taiwan Dollars)

For the three months ended March 31, 2023

No.	Company Name	Counterparty	Nature of Relationship (Note 1)		Intercompany Transactions	Intercompany Transactions
				Accounts	Amount	Terms (Notes 1 and 2)	Percentage of Consolidated Total Gross Sales or Total Assets (%)
0	TXC Corporation	TXC (Ningbo) Corporation TXC (Chongqing) Corporation TETC CORP. NINGBO	a a a	Sales Purchases Trade receivables Trade payables Purchases Trade payables Purchases Trade payables	$ 136,663 544,328 152,320 539,143 304,707 304,809 94,151 93,690	a a a a a a a a	6 24 1 3 13 2 4 -
1	TXC (Ningbo) Corporation	TXC (Chongqing) Corporation TETC CORP. NINGBO	c c	Purchases Trade payables Trade receivables Other receivables	37,678 44,748 22,663 36,929	c c c c	2 - - -

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

c. Represent the transactions between subsidiaries.

Note 2: For the three months ended March 31, 2023 and 2022, the selling price and purchasing price were not significantly different from those of third parties, except for TXC (Ningbo) Corporation, TXC (Chongqing) Limited, TETC CORP. NINGBO and Taiwan Crystal Technology (HK) Limited which is depending on its function within the Group.

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

56 -

AI assistant

TXC — Interim / Quarterly Report 2023

52274_rns_2023-11-13_7a6ac49e-df58-4ebb-9dc6-8d19c7c3e419.pdf

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Thousands of New Taiwan Dollars)

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

TXC CORPORATION AND SUBSIDIARIES

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

TXC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

TXC CORPORATION AND SUBSIDIARIES

1. GENERAL INFORMATION

2. APPROVAL OF FINANCIAL STATEMENTS

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

4. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION

c. Basis of consolidation

1) Retirement benefits

3) Income tax expense

5. MATERIAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

6. CASH AND CASH EQUIVALENTS

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

9. FINANCIAL ASSETS AT AMORTIZED COST

10. NOTES RECEIVABLE AND TRADE RECEIVABLES

11. INVENTORIES

12. SUBSIDIARIES

Subsidiary Included in the Consolidated Financial Statements

13. NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE

14. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

b. Investment joint ventures

15. PROPERTY, PLANT AND EQUIPMENT

16. LEASE ARRANGEMENTS

b. Lease liabilities

d. Other lease information

17. INVESTMENT PROPERTIES

18. BORROWINGS

a. Short-term borrowings

March 31, 2022

c. Long-term borrowings

19. BONDS PAYABLE

20. OTHER LIABILITIES

21. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

b. Defined benefit plans

22. EQUITY

b. Capital surplus

c. Retained earnings and dividends policy

d. Other equity items

23. REVENUE

Contract Balances

24. NET PROFIT FROM CONTINUING OPERATIONS

a. Interest income

c. Other gains and losses

f. Employee benefits expense

g. Employees’ compensation and remuneration of directors

Accrual rate

25. INCOME TAXES RELATING TO CONTINUING OPERATIONS

b. Income tax assessments

26. EARNINGS PER SHARE

Net Profit for the Period

27. GOVERNMENT GRANTS

28. CAPITAL MANAGEMENT

29. FINANCIAL INSTRUMENTS

a. Fair value of financial instruments

March 31, 2023

March 31, 2022

For the three months ended March 31, 2022

c. Categories of financial instruments

1) Market risk

Sensitivity analysis

b) Interest rate risk

Sensitivity analysis

2) Credit risk

3) Liquidity risk

Liquidity and interest risk rate tables

March 31, 2022

TXC Interim / Quarterly Report 2023