UNITECH — Audit Report / Information 2023

Nov 9, 2023

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Stock Code:2367

Unitech Printed Circuit Board Corporation and Subsidiaries

Consolidated Financial Statements

With Independent Auditors’ Report For the Years Ended December 31, 2023 and 2022

Address: No. 3, Lane 4, Zhongshan Road, Tucheng District, New Taipei City Telephone: (02)2268-5071

The independent auditors’ report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and consolidated financial statements, the Chinese version shall prevail.

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Table of contents

Contents 1. Cover Page 2. Table of Contents 3. Representation Letter 4. Independent Auditors’ Report 5. Consolidated Balance Sheets 6. Consolidated Statements of Comprehensive Income 7. Consolidated Statements of Changes in Equity 8. Consolidated Statements of Cash Flows 9. Notes to the Consolidated Financial Statements (1) Company history (2) Approval date and procedures of the consolidated financial statements (3) New standards, amendments and interpretations adopted (4) Summary of material accounting policies (5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty (6) Explanation of significant accounts (7) Related-party transactions (8) Pledged assets (9) Significant commitments and contingencies (10) Losses Due to Major Disasters (11) Subsequent Events (12) Other (13) Other disclosures (a) Information on significant transactions (b) Information on investees (c) Information on investment in mainland China (d) Major shareholders (14) Segment information

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1 2 3 4 5 6 7 8 9 9 9～10 10～26 26～27 28～62 62～64 64 65 65 65 65 66～69 69 69～70 70 70～71

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Representation Letter

The entities that are required to be included in the combined financial statements of Unitech Printed Circuit Board Corporation as of and for the year ended December 31, 2023 under the Criteria Governing the Preparation of Affiliation Reports, Consolidated Business Reports, and Consolidated Financial Statements of Affiliated Enterprises are the same as those included in the consolidated financial statements prepared in conformity with International Financial Reporting Standards No. 10, "Consolidated Financial Statements. " endorsed by the Financial Supervisory Commission of the Republic of China. In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, Unitech Printed Circuit Board Corporation and Subsidiaries do not prepare a separate set of combined financial statements.

Company name: Unitech Printed Circuit Board Corporation Chairman: CHANG, YUAN-MING Date: March 13, 2024

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KPMG

台北市110615信義路5段7號68樓(台北101大樓) 電 話 Tel + 886 2 8101 6666 68F., TAIPEI 101 TOWER, No. 7, Sec. 5, 傳 真 Fax + 886 2 8101 6667 Xinyi Road, Taipei City 110615, Taiwan (R.O.C.) 網 址 Web kpmg.com/tw

Independent Auditors’ Report

To the Board of Directors of Unitech Printed Circuit Board Corporation:

Opinion

We have audited the consolidated financial statements of Unitech Printed Circuit Board Corporation and its subsidiaries (“the Group”), which comprise the consolidated balance sheet as of December 31, 2023 and 2022, the consolidated statement of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of material accounting policies.

In our opinion, based on our audits and the report of other auditors (please refer to Other Matter paragraph), the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2023 and 2022, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards (“ IFRSs” ), International Accounting Standards (“ IASs” ), Interpretations developed by the International Financial Reporting Interpretations Committee (“ IFRIC” ) or the former Standing Interpretations Committee (“SIC”) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In our professional judgments, key audit matters to communicated in the independent auditor's report is listed below:

Evaluation of Inventories

Please refer to note 4(h) “Inventories”, note 5 “Significant accounting assumptions and judgments, and major sources of estimations uncertainty”, and note 6(e) “Inventories” of the consolidated financial statements.

KPMG, a Taiwan partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

4-1

Description of key audit matter:

Inventories are measured by the lower cost and net realizable value accounting. Due to the rapid change of terminal product market, the clients’ intention about placing and changing orders for products could be affected. Furthermore, it also resulted in a risk in which the carrying value of inventories may be higher than its net realizable value and caused the obsolete stock. Therefore, the valuation of inventories is one of the key audit matters for our audit.

How the matter was addressed in our audit:

Our principal audit procedures included: Evaluating the rationality of the policy of making provision to inventories impairment, evaluating the assumption of allowance for inventory valuation of the authorities, and the situation of obsolescence of inventory that has happened in prior periods; confirming whether the Group has undertaken the inventory valuation based on the policy; inspecting the inventory aging report and analyzing the difference in the inventory aging in comparison to prior periods. Understanding and evaluating the management’ s judgment on the calculation of the net realizable value; testing the appropriateness of the inventory valuation, evaluating the management’s calculations of allowance for inventory loss to ensure their appropriateness and considering the adequacy of the Group’s disclosures in allowance for inventory valuation.

Other Matter

The Group’s investee company was accounted for by the equity method based on its financial statements which was audited by other auditors. Our opinion, insofar as it related to the Group’s investee company is based solely on the report of other auditors. As of December 31, 2023 and 2022, the total assets of investee company which constituted 4.26% and 4.44% of the Group’ s consolidated total assets, respectively. For the year ended December 31, 2023 and 2022, the profit and loss of affiliated companies accounted for by using the equity method constituted 25.44% and 0.78% of the income which the Group recognized before tax, respectively.

We have also audited the parent company only financial statements of Unitech Printed Circuit Board Crop. as of and for the years ended December 31, 2023 and 2022, on which we have issued an unmodified opinion.

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

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

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

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

4-2

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

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

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

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

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

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

6. Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

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

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

4-3

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

The engagement partners on the audit resulting in this independent auditors’ report are Horng, Shyh-Gang and Hsu, Ming-Fang.

KPMG

Taipei, Taiwan (Republic of China) March 13, 2024

Notes to Readers

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

The independent auditors’ report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and consolidated financial statements, the Chinese version shall prevail.

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Unitech Printed Circuit Board Corporation and Subsidiaries

Consolidated Balance Sheets

December 31, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars)

Assets Current assets: 1100 Cash and cash equivalents (note 6(a)) 1110 Current financial assets at fair value through profit or loss (note 6(b)) 1150 Notes receivable, net (notes 6(d) and (t)) 1170 Accounts receivable, net (notes 6(d) and (t)) 1200 Other receivables 1210 Other receivables-related parties (note 7) 1310 Inventories (note 6(e)) 1410 Prepayments 1476 Other financial assets-current 1479 Other current assets Total current assets Non-current assets: 1517 Financial assets at fair value through other comprehensive income non- current (note 6(c)) 1550 Investments accounted for using equity method, net (notes 6(g) and 8) 1600 Property, plant and equipment (notes 6(h), (v), 8 and 9) 1755 Right-of-use assets (notes 6(i) and 8) 1780 Intangible assets (note 6(j)) 1840 Deferred tax assets (note 6(p)) 1915 Prepayments for business facilities (note 9) 1920 Refundable deposits (note 8) 1990 Other non-current assets Total non-current assets Total assets	December 31, 2023 Amount % $ 866,459 4 20,481 - 11,815 - 4,023,205 19 68,533 1 637 - 2,347,852 11 89,521 - 3,404 - 9,284 - 7,441,191 35 435,752 2 912,683 4 11,710,642 55 369,179 2 123,484 1 302,660 1 10,906 - 60,682 - 63,970 - 13,989,958 65 $ 21,431,149 100	December 31, 2022 Amount % 744,162 3 103,462 1 11,289 - 4,335,927 19 66,629 - 675 - 2,720,289 12 95,406 - 3,750 - 11,747 - 8,093,336 35 670,766 3 1,039,704 4 12,545,734 54 431,614 2 138,070 1 303,376 1 28,211 - 70,910 - 73,022 - 15,301,407 65 23,394,743 100 Liabilities and Equity Current liabilities: 2100 Short-term borrowings (notes 6(k) and 8) 2170 Accounts payable 2200 Other payables (note 6(l)) 2230 Current tax liabilities 2280 Current lease liabilities (note 6(n)) 2322 Current portion of long-term borrowings (notes 6(m) and 8) 2399 Other current liabilities Total current liabilities Non-Current liabilities: 2540 Long-term borrowings (notes 6(m) and 8) 2570 Deferred tax liabilities (note 6(p)) 2580 Non-current lease liabilities (note 6(n)) 2640 Net defined benefit liability, non-current (note 6(o)) Total non-current liabilities Total liabilities Equity attributable to owners of parent(note 6(q)): 3110 Ordinary shares 3200 Capital surplus Retained earnings: 3310 Legal reserve 3350 Unappropriated retained earnings Total retained earnings Other equity: 3410 Exchange differences on translation of foreign financial statements 3420 Unrealized gains (losses) from financial assets at fair value through other comprehensive income 3445 Gains (losses) on remeasurements of defined benefit Total other equity Total equity Total liabilities and equity	December 31, 2023	December 31, 2023		December 31, 2022 Amount % 1,627,615 7 2,426,512 11 1,151,096 5 805 - 86,315 - 2,414,093 10 77,843 - 7,784,279 33 4,291,133 18 171,517 1 228,988 1 194,463 1 4,886,101 21 12,670,380 54 6,694,072 29 3,037,149 13 306,606 1 413,712 2 720,318 3 66,843 - 443,927 2 (237,946) (1) 272,824 1 10,724,363 46 23,394,743 100
			Amount	%

See accompanying notes to consolidated financial statements.

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Unitech Printed Circuit Board Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

2023 Amount % 4000 Operating revenue, net(note 6(t)) 14,960,822 100 5110 Cost of sales(notes 6(e), (j), (n), (o) and 12) 13,606,823 91 Gross profit from operations 1,353,999 9 Operating expenses:(notes 6(d), (j), (n), (o), (r), (u), 7 and 12) 6100 Selling expenses and administrative expenses 1,588,553 10 6300 Research and development expenses 140,028 1 6450 Expected credit loss (gain) 13,005 - Total operating expenses 1,741,586 11 Net operating (loss) profit (387,587) (2) Non-operating income and expenses(notes 6(b), (f), (g), (h), (n) and (v)): 7100 Interest income 15,247 - 7010 Other income 89,443 1 7020 Other gains and losses, net 251,239 2 7050 Finance costs, net (225,242) (2) 7060 Share of (loss) profit of associates accounted for using equity method, net (87,664) (1) Total non-operating income and expenses 43,023 - (Loss) profit from continuing operations before tax (344,564) (2) 7950 Less: Income tax (income) expenses (note 6(p)) (323) - (Loss) profit (344,241) (2) 8300 Other comprehensive income: 8310 Items that may not be reclassified subsequently to profit or loss 8311 Gains (losses) on remeasurements of defined benefit plans (867) - 8316 Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income (235,014) (2) 8320 Share of other comprehensive income of associates accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss (28,434) - Items that may not be reclassified subsequently to profit or loss (264,315) (2) 8360 Items that may be reclassified subsequently to profit or loss 8361 Exchange differences on translation of foreign financial statements (89,192) (1) Items that may be reclassified subsequently to profit or loss (89,192) (1) 8300 Other comprehensive income (after tax) (353,507) (3) Comprehensive income $ (697,748) (5) (Loss) profit attributable to: Owners of parent $ (344,241) (2) $ (344,241) (2) Comprehensive (loss) income attributable to: Owners of parent $ (697,748) (5) $ (697,748) (5) (Loss) earnings per share (NT dollars)(note 6(s)) Basic (loss) earnings per share (NT dollars) $ (0.51) Diluted (loss) earnings per share (NT dollars) $ (0.51)

2022 Amount % 17,423,501 100 15,240,742 87 2,182,759 13 1,753,137 10 142,140 1 (19,458) - 1,875,819 11 306,940 2 4,140 - 105,122 1 191,564 1 (176,054) (1) 3,379 - 128,151 1 435,091 3 21,765 - 413,326 3 (57,708) (1) 137,624 1 - - 79,916 - 33,813 - 33,813 - 113,729 - 527,055 3 413,326 3 413,326 3 527,055 3 527,055 3 0.65 0.65

See accompanying notes to consolidated financial statements.

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Unitech Printed Circuit Board Corporation and Subsidiaries

Consolidated Statements of Changes in Equity

For the years ended December 31, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars)

Balance at January 1, 2022 Profit Other comprehensive income Comprehensive income Changes in equity of associates accounted for using equity method Issuance of shares Balance at December 31, 2022 Loss Other comprehensive income Comprehensive income Appropriation and distribution of retained earnings: Legal reserve Cash dividends of ordinary share Other changes in capital surplus: Other changes in capital surplus Changes in equity of associates accounted for using equity method Balance at December 31, 2023					Equity attributable to owner	Equity attributable to owner	Equity attributable to owner	Equity attributable to owner	Equity attributable to owner	s of parent	s of parent				Total equity attributable to owners of parent	Total equity 9,493,243 413,326 113,729 527,055 315 703,750 10,724,363 (344,241) (353,507) (697,748) - (200,822) 114 (1,905) 9,824,002
	Ordinary shares		Capital surplus		Retained earnings					Total other equity interest
								Exchange differences on translation of foreign financial statements		Unrealized gains (losses) from financial assets at fair value Gains (losses) on through other comprehensive income remeasurements of defined benefit			Unearned employee compensation
					Legal reserve	Unappropriated retained earnings
	$ 6,194,072 - - - - 500,000 6,694,072 - - - - - - - $ 6,694,072		2,833,418		306,606		386		33,030		(180,238) - (57,708) (57,708) - - (237,946) - (177) (177) - - - - (238,123)		(334) - - - 334 - - - - - - - - - -		9,493,243 413,326 113,729 527,055 315 703,750 10,724,363 (344,241) (353,507) (697,748) - (200,822) 114 (1,905) 9,824,002
			- -		- -		413,326 -		- 33,813
			-		-		413,326		33,813
					- -		- -		- -
					306,606		413,712		66,843
					- -
					-
					41,332 - - -
					347,938

See accompanying notes to consolidated financial statements.

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Unitech Printed Circuit Board Corporation and Subsidiaries

Consolidated Statements of Cash Flows

For the years ended December 31, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities: (Loss) profit before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Expected credit loss (gain) Interest expense Interest income Dividend income Share-based payments Share of loss (profit) of associates accounted for using equity method Loss on disposal of property, plant and equipment Gain on disposal of non-current assets held for sale Net profit on financial assets at fair value through profit or loss Other items Total adjustments to reconcile profit Changes in operating assets and liabilities: Notes receivable Accounts receivable Other receivables Other receivables-related parties Inventories Prepayments Other financial assets-current Other current assets Accounts payable Other payables Other current liabilities Net defined benefit liability Total changes in operating assets and liabilities Total adjustments	2023 $ (344,564) 1,548,665 70,212 13,005 225,242 (15,247) (6,898) - 87,664 5,984 (200,629) (437) (44) 1,727,517 (526) 299,717 (1,904) 38 372,437 5,885 346 2,463 (284,718) (191,676) (37,771) (53,367) 110,924 1,838,441	2022 435,091 1,526,606 59,398 (19,458) 176,054 (4,140) (5,837) 5,500 (3,379) 7,934 - (1,926) 868 1,741,620 (5,779) (209,749) 6,163 (81) (342,040) (10,271) 384 (227) (345,222) (33,176) 47,979 (26,903) (918,922) 822,698

See accompanying notes to consolidated financial statements.

8-1

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Unitech Printed Circuit Board Corporation and Subsidiaries

Consolidated Statements of Cash Flows

For the years ended December 31, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars)

Cash inflow generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash flows from operating activities Cash flows from (used in) investing activities: Acquisition of financial assets at fair value through profit or loss Proceeds from disposal of financial assets at fair value through profit or loss Proceeds from disposal of non-current assets classified as held for sale Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease (increase) in refundable deposits Acquisition of intangible assets Increase in other non-current assets Dividends received Net cash flows used in investing activities Cash flows from (used in) financing activities: Increase in short-term borrowings Decrease in short-term borrowings Increase in short-term notes and bills payable Decrease in short-term notes and bills payable Proceeds from long-term borrowings Repayments of long-term borrowings Increase in guarantee deposits received Payment of lease liabilities Cash dividends Capital increase by cash Net cash flows used in financing activities Effect of exchange rate changes on cash and cash equivalents Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period

See accompanying notes to consolidated financial statements.

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Unitech Printed Circuit Board Corporation and Subsidiaries

Notes to the Consolidated Financial Statements

For the years ended December 31, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(1) Company history

Unitech Printed Circuit Board Corporation (the “Company”) was incorporated on December 31, 1984, with registered address of No. 3, Lane 4, Zhongshan Road, Tucheng District, New Taipei City, Taiwan, as a company limited by shares under the Company Act of the Republic of China (R.O.C.). The major business activities of Unitech Printed Circuit Board Corporation and subsidiaries (the “Group”) are the design, manufacture and sale of PCB.

(2) Approval date and procedures of the consolidated financial statements:

These consolidated financial statements were authorized for issue by the Board of Directors on March 13, 2024.

(3) New standards, amendments and interpretations adopted:

• (a) The impact of the International Financial Reporting Standards (“IFRSs”) endorsed by the Financial Supervisory Commission, R.O.C. (“FSC”) which have already been adopted.

The Group has initially adopted the following new amendments, which do not have a significant impact on its consolidated financial statements, from January 1, 2023:

• ●Amendments to IAS 1 “Disclosure of Accounting Policies”

• ●Amendments to IAS 8 “Definition of Accounting Estimates”

• ●Amendments to IAS 12 “ Deferred Tax related to Assets and Liabilities arising from a Single Transaction”

The Group has initially adopted the new amendment, which do not have a significant impact on its consolidated financial statements, from May 23, 2023:

• ●Amendments to IAS 12 “International Tax Reform—Pillar Two Model Rules”

• (b) The impact of IFRS issued by the FSC but not yet effective

The Group assesses that the adoption of the following new amendments, effective for annual period beginning on January 1, 2024, would not have a significant impact on its consolidated financial statements:

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

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

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

• ●Amendments to IFRS 16 “Lease Liability in a Sale and Leaseback”

(Continued)

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Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• (c) The impact of IFRS issued by IASB but not yet endorsed by the FSC

The Group does not expect the following new and amended standards, which have yet to be endorsed by the FSC, to have a significant impact on its consolidated financial statements:

• ●Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets Between an Investor and Its Associate or Joint Venture”

• ●IFRS 17 “ Insurance Contracts” and amendments to IFRS 17

• ●Amendments to IAS21 “Lack of Exchangeability”

(4) Summary of material accounting policies:

The material accounting policies presented in the consolidated financial statements are summarized below. Except for those specifically indicated, the following accounting policies were applied consistently throughout the periods presented in the consolidated financial statements.

(a) Statement of compliance

These consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers (“the Regulations”) and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations and SIC Interpretations endorsed by the FSC (“the IFRSs endorsed by the FSC”).

• (b) Basis of preparation

• (i) Basis of measurement

Except for the following significant accounts, the consolidated financial statements have been prepared on a historical cost basis:

• 1) Financial instruments at fair value through profit or loss are measured at fair value;

• 2) Financial assets at fair value through other comprehensive income are measured at fair value;

• 3) The defined benefit liabilities (assets) are measured at fair value of the plan assets less the present value of the defined benefit obligation, limited as explained in note 4(q).

• (ii) Functional and presentation currency

The functional currency of each Group entity is determined based on the primary economic environment in which the entity operates. The consolidated financial statements are presented in New Taiwan Dollar (NTD), which is the Company’ s functional currency. All financial information presented in NTD has been rounded to the nearest thousand.

(Continued)

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Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(c) Basis of consolidation

• (i) Principles of preparation of the consolidated financial statements

The consolidated financial statements comprise the Company and subsidiaries. Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date on which control ceases. Intragroup balances and transactions, and any unrealized income and expenses arising from Intragroup transactions are eliminated in preparing the consolidated financial statements. The Group attributes the profit or loss and each component of other comprehensive income to the owners of the parent and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance.

Accounting policies of subsidiaries have been adjusted to ensure consistency with the policies adopted by the Group.

Changes in the Group’s ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. Any difference between the amount by which the noncontrolling interests are adjusted and the fair value of the consideration paid or received will be recognized directly in equity, and the Group will attribute it to the owners of the parent.

When the Group loses control over a subsidiary, it derecognizes the assets (including any goodwill) and liabilities of the subsidiary, and any related non-controlling interests and other components of equity. Any interest retained in the former subsidiary is measured at fair value when control is lost, with the resulting gain or loss being recognized in profit or loss. The Group recognizes as gain or loss in profit or loss the difference between (i) the fair value of the consideration received as well as any investment retained in the former subsidiary at its fair value at the date when control is lost ;and (ii) the assets (including any goodwill), liabilities of the subsidiary as well as any related non-controlling interests at their carrying amounts at the date when control is lost, as gain or loss in profit or loss. When the Group loses control of its subsidiary, it accounts for all amounts previously recognized in other comprehensive income in relation to that subsidiary on the same basis as would be required if it had directly disposed of the related assets or liabilities.

(Continued)

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Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(ii) List of subsidiaries in the consolidated financial statements

Name of investor	Name of subsidiary	Principal activity	Shareholding December 31, 2023 December 31, 2022 % 100.00 % 100.00 Note 1 % 100.00 % 100.00 - % 6.10 % 6.10 - % 100.00 % - Note 2 % 93.90 % 93.90 - % 100.00 % 100.00 - % 21.33 % 21.33 Note 3 % 78.67 % 78.67 Note 3
The Company The Company The Company The Company Unitech BVI Unitech HK Unitech HK Shanghai Unitech Electronics Co., Ltd.	Unitech Electronics International Limited (Unitech BVI) DA-TAI Investment Co., Ltd. Unitech Electronics International (HK) Limited (Unitech HK) UNITECH PCB (THAILAND) CO., LTD. (Unitech Thailand) Unitech Electronics International (HK) Limited (Unitech HK) Shanghai Unitech Electronics Co., Ltd. Shanghai Unitech Electronics (Nantong) Co., Ltd. Shanghai Unitech Electronics (Nantong) Co., Ltd.	General investing General investing General investing Manufacturing of electronics General investing Manufacturing of electronics Manufacturing of electronics Manufacturing of electronics

Note 1: The Company increased the capital of Unitech BVI by US$8,800 thousand in November 2023. Note 2: The Company invested Unitech Thailand in August 2023. Note 3: Unitech HK increased the capital of Shanghai Unitech Electronics (Nantong) Co.,Ltd by US$20,000 thousand in March 2022.

(iii) Subsidiaries excluded from the consolidated financial statements: None.

(d) Foreign currencies

• (i) Foreign currency transactions

Transactions in foreign currencies are translated into the respective functional currencies of Group entities at the exchange rates at the dates of the transactions. At the end of each subsequent reporting period, monetary items denominated in foreign currencies are translated into the functional currencies using the exchange rate at that date. Non-monetary items denominated in foreign currencies that are measured at fair value are translated into the functional currencies using the exchange rate at the date that the fair value was determined. Non-monetary items denominated in foreign currencies that are measured based on historical cost are translated using the exchange rate at the date of the transaction.

Exchange differences are generally recognized in profit or loss, except for those differences relating to the following, which are recognized in other comprehensive income:

An investment in equity securities designated as at fair value through other comprehensive income.

(Continued)

13

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(ii) Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into the presentation currency at the exchange rates at the reporting date. The income and expenses of foreign operations are translated into the presentation currency at the average exchange rate. Exchange differences are recognized in other comprehensive income.

When a foreign operation is disposed of such that control, significant influence, or joint control is lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the gain or loss on disposal. When the consolidated disposes of only part of its interest in a subsidiary that includes a foreign operation while retaining control, the relevant proportion of the cumulative amount is reattributed to noncontrolling interests. When the Group disposes of only part of its investment in an associate or joint venture that includes a foreign operation while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.

When the settlement of a monetary receivable from or payable to a foreign operation is neither planned nor likely to occur in the foreseeable future, Exchange differences arising from such a monetary item that are considered to form part of the net investment in the foreign operation are recognized in other comprehensive income.

• (e) Classification of current and non-current assets and liabilities

An asset is classified as current under one of the following criteria, and all other assets are classified as non current.

• (i) It is expected to be realized, or intended to be sold or consumed, in the normal operating cycle;

• (ii) It is held primarily for the purpose of trading;

• (iii) It is expected to be realized within twelve months after the reporting period; or

• (iv) The asset is cash or a cash equivalent unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

A liability is classified as current under one of the following criteria, and all other liabilities are classified as non current.

• (i) It is expected to be settled in the normal operating cycle;

• (ii) It is held primarily for the purpose of trading;

• (iii) It is due to be settled within twelve months after the reporting period; or

• (iv) The Group does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by issuing equity instruments do not affect its classification.

(Continued)

14

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(f) Cash and cash equivalents

Cash comprises cash on hand and demand deposits. Cash equivalents are short term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. Time deposits which meet the above definition and are held for the purpose of meeting short term cash commitments rather than for investment or other purposes should be recognized as cash equivalents.

(g) Financial Instruments

Accounts receivable are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Group becomes a party to the contractual provisions of the instrument. A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured at fair value plus, for an item not at fair value through profit or loss (FVTPL), transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price.

(i) Financial assets

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

On initial recognition, a financial asset is classified as measured at: amortized cost; Fair value through other comprehensive income (FVOCI)– equity investment; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model.

• 1) Financial assets measured at amortized cost

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

• it is held within a business model whose objective is to hold assets to collect contractual cash flows; and

• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding.

These assets are subsequently measured at amortized cost, which is the amount at which the financial asset is measured at initial recognition, plus/minus, the cumulative amortization using the effective interest method, adjusted for any loss allowance. Interest income, foreign exchange gains and losses, as well as impairment, are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss.

• 2) Fair value through other comprehensive income (FVOCI)

On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent changes in the investment’s fair value in other comprehensive income. This election is made on an instrument-by-instrument basis.

(Continued)

15

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Equity investments at FVOCI are subsequently measured at fair value. Dividends are recognized as income in profit or loss unless the dividend clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognized in other comprehensive income and are never reclassified to profit or loss.

Dividend income is recognized in profit or loss on the date on which the Group’s right to receive payment is established.

• 3) Fair value through profit or loss (FVTPL)

All financial assets not classified as amortized cost or FVOCI described as above (e.g. financial assets held for trading and those that are managed and whose performance is evaluated on a fair value basis) are measured at FVTPL, including derivative financial assets. On initial recognition, the Group may irrevocably designate a financial asset, which meets the requirements to be measured at amortized cost or at FVOCI, as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.

• 4) Impairment of financial assets

The Group recognizes loss allowances for expected credit losses (ECL) on financial assets measured at amortized cost (including cash and cash equivalents, financial assets measured at amortized cost, notes and accounts receivable, other receivables and refundable deposits).

The Group measures loss allowances at an amount equal to lifetime ECL, except for the following which are measured as 12-month ECL:

• The credit risk of bank deposits (e.g. the risk of default occurring beyond the expected duration of the financial instruments) has not increased significantly since the original recognition.

Loss allowance for trade receivables are always measured at an amount equal to lifetime ECL.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECL, the Group considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis based on the Group’s historical experience and informed credit assessment as well as forward-looking information.

The Group assumes that the credit risk on a financial asset has increased significantly if it is more than 90 days past due.

The Group considers a financial asset to be in default when the financial asset is more than one year past due or the debtor is unlikely to pay its credit obligations to the Group in full.

(Continued)

16

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

ECL are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e the difference between the cash flows due to the Group in accordance with the contract and the cash flows that the Group expects to receive). ECL are discounted at the effective interest rate of the financial asset.

At each reporting date, the Group assesses whether financial assets carried at amortized cost and debt securities at FVOCI are credit-impaired. A financial asset is ‘ creditimpaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit-impaired includes the following observable data:

• significant financial difficulty of the borrower or issuer;

• a breach of contract such as a default or being more than 90 days past due;

• the lender of the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty, having granted to the borrower a concession that the lender would not otherwise consider;

• it is probable that the borrower will enter bankruptcy or other financial reorganization ； or

• the disappearance of an active market for a security because of financial difficulties.

Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. For debt securities at FVOCI, the loss allowance is charged to profit or loss and is recognized in other comprehensive income instead of reducing the carrying amount of the asset.

The gross carrying amount of a financial asset is written off when the Group has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. For corporate customers, the Group individually makes an assessment with respect to the timing and amount of write-off based on whether there is a reasonable expectation of recovery. The Group expects no significant recovery from the amount written off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Group’s procedures for recovery of amounts due.

• 5) Derecognition of financial assets

The Group derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

The Group enters into transactions whereby it transfers assets recognized in its statement of balance sheet, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognized.

(Continued)

17

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(ii) Financial liabilities and equity instruments

• 1) Classification of debt or equity

Debt and equity instruments issued by the Group are classified as financial liabilities or equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

2) Equity instrument

An equity instrument is any contract that evidences residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued are recognized as the amount of consideration received, less the direct cost of issuing.

3) Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss.

Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss.

4) Derecognition of financial liabilities

The Group derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. The Group also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value.

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

• 5) Offsetting of financial assets and liabilities

Financial assets and financial liabilities are offset and the net amount presented in the statement of balance sheet when, and only when, the Group currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.

(Continued)

18

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(h) Inventories

Inventories are measured at the lower of cost and net realizable value. The cost of inventories is calculated using the weighted average method, and includes expenditure incurred in acquiring the inventories, production or conversion costs, and other costs incurred in bringing them to their present location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of production overheads based on normal operating capacity.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

• (i) Non-current assets held for sale

On March 3, 2023, the Group’s board of directors resolved to sell certain land, plant and equipment. Therefore, the Group has applied the accounting policy related to non-current assets held for sale from January 1, 2023 onwards.

Non-current assets or disposal groups comprising assets and liabilities that are highly probable to be recovered primarily through sale rather than through continuing use, are reclassified as held for sale. Immediately before classification as held for sale, the assets, or components of a disposal group, are remeasured in accordance with the Group’s accounting policies. Thereafter, generally, the assets or disposal groups are measured at the lower of their carrying amount and fair value less costs to sell.

Any impairment loss on a disposal group is first allocated to goodwill, and then to the remaining assets and liabilities on a pro rata basis, except that no loss is allocated to assets not within the scope of IAS 36 – Impairment of Assets. Such assets will continue to be measured in accordance with the Group’s accounting policies.

Impairment losses on assets initially classified as held for sale and any subsequent gains or losses on remeasurement are recognized in profit or loss. Gains are not recognized in excess of the cumulative impairment loss that has been recognized.

Once classified as held for sale, property, plant and equipment are no longer amortized or depreciated.

(j) Investment in associates

Associates are those entities in which the Group has significant influence, but not control or joint control, over their financial and operating policies.

Investments in associates are accounted for using the equity method and are recognized initially at cost. The cost of the investment includes transaction costs. The carrying amount of the investment in associates includes goodwill arising from the acquisition less any accumulated impairment losses.

The consolidated financial statements include the Group’ s share of the profit or loss and other comprehensive income of those associates, after adjustments to align their accounting policies with those of the Group, from the date on which significant influence commences until the date on which significant influence ceases. The Group recognizes any changes of its proportionate share in the investee within capital surplus, when an associate’s equity changes due to reasons other than profit and loss or comprehensive income, which did not result in changes in actual proportionate share.

(Continued)

19

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Gains and losses resulting from transactions between the Group and an associate are recognized only to the extent of unrelated Group’s interests in the associate.

When the Group’s share of losses of an associate equals or exceeds its interests in an associate, it discontinues recognizing its share of further losses. After the recognized interest is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate.

• (k) Property, plant and equipment

• (i) Recognition and measurement

Items of property, plant and equipment are measured at cost, which includes capitalized borrowing costs, less accumulated depreciation and any accumulated impairment losses.

If significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment is recognized in profit or loss.

• (ii) Subsequent expenditure

Subsequent expenditure is capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Group.

• (iii) Depreciation

Depreciation is calculated on the cost of an asset less its residual value and is recognized in profit or loss on a straight line basis over the estimated useful lives of each component of an item of property, plant and equipment.

Land is not depreciated.

The estimated useful lives of property, plant and equipment for current and comparative periods are as follows:

1)	Buildings and constructions	3~55 years
2)	Machinery equipment	3~12 years
3)	Office equipment	3~5 years
4)	Other equipment	3-5 years

Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

(Continued)

20

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(l) Leases

At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

• (i) As a lessee

The Group recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be reliably determined, the Group’s incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate.

Lease payments included in the measurement of the lease liability comprise the following:

• 1) fixed payments, including in-substance fixed payments;

• 2) variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

• 3) amounts expected to be payable under a residual value guarantee; and

• 4) payments for purchase or termination options that are reasonably certain to be exercised.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when:

• 1) there is a change in future lease payments arising from the change in an index or rate; or

• 2) there is a change in the Group’s estimate of the amount expected to be payable under a residual value guarantee; or

• 3) there is a change in the lease term resulting from a change of its assessment on whether it will exercise an option to purchase the underlying asset, or

• 4) there is a change of its assessment on whether it will exercise an extension or termination option; or

• 5) there is any lease modification

(Continued)

21

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

When the lease liability is remeasured, other than lease modifications, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or in profit and loss if the carrying amount of the right-of-use asset has been reduced to zero.

When the lease liability is remeasured to reflect the partial or full termination of the lease for lease modifications that decrease the scope of the lease, the Group accounts for the remeasurement of the lease liability by decreasing the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease, and recognize in profit or loss any gain or loss relating to the partial or full termination of the lease.

The Group presents right-of-use assets that do not meet the definition of investment and lease liabilities as a separate line item respectively in the statement of financial position.

The Group has elected not to recognize right-of-use assets and lease liabilities for short-term leases of office equipment that have a lease term of 12 months or less and leases of low-value assets. The Group recognizes the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

(ii) As a lessor

When the Group acts as a lessor, it determines at lease commencement whether each lease is a finance lease or an operating lease. To classify each lease, the Group makes an overall assessment of whether the lease transfers to the lessee substantially all of the risks and rewards of ownership incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; if not, then the lease is an operating lease. As part of this assessment, the Group considers certain indicators such as whether the lease is for the major part of the economic life of the asset.

When the Group is an intermediate lessor, it accounts for its interests in the head lease and the sub-lease separately. It assesses the lease classification of a sub-lease with reference to the right-of-use asset arising from the head lease. If a head lease is a short-term lease to which the Group applies the exemption described above, then it classifies the sub-lease as an operating lease.

If an arrangement contains lease and non-lease components, the Group applies IFRS15 to allocate the consideration in the contract.

The Group recognizes a finance lease receivable at an amount equal to its net investment in the lease. Initial direct costs, such as lessors to negotiate and arrange a lease, are included in the measurement of the net investment. The interest income is recognized over the lease term based on a pattern reflecting a constant periodic rate of return on the net investment in the lease. The Group recognizes lease payments received under operating leases as income on a straight-line basis over the lease term as part of ‘other income’.

(Continued)

22

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(m) Intangible assets

(i) Recognition and measurement

Expenditure on research activities is recognized in profit or loss as incurred.

Development expenditure is capitalized only if the expenditure can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable and the Group intends to, and has sufficient resources to, complete development and to use or sell the asset. Otherwise, it is recognized in profit or loss as incurred. Subsequent to initial recognition, development expenditure is measured at cost, less accumulated amortization and any accumulated impairment losses.

Other intangible assets that are acquired by the Group and have finite useful lives are measured at cost less accumulated amortization and any accumulated impairment losses.

(ii) Subsequent expenditure

Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognized in profit or loss as incurred.

(iii) Amortization

Amortization is calculated over the cost of the asset, less its residual value, and is recognized in profit or loss on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill, from the date that they are available for use.

The estimated useful lives for current and comparative periods are as follows:

• 1) Computer software 5~10 years

Amortization methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

(n) Impairment of non-financial assets

At each reporting date, the Group reviews the carrying amounts of its non-financial assets (other than inventories and deferred tax assets) to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated.

For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash-generating units (CGUs). Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the combination.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU.

(Continued)

23

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its recoverable amount.

Impairment losses are recognized in profit or loss. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

(o) Revenue recognition

Revenue from contracts with customers

Revenue is measured based on the consideration to which the Group expects to be entitled in exchange for transferring goods or services to a customer. The Group recognizes revenue when it satisfies a performance obligation by transferring control of a good or a service to a customer. The accounting policies for the Group’s main types of revenue are explained below.

● Sale of goods

The Group design, manufacture and sale PCB. The Group recognizes revenue when control of the products has transferred, being when the products are delivered to the customer, the customer has full discretion over the channel and price to sell the products, and there is no unfulfilled obligation that could affect the customer’ s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed, or the Group has objective evidence that all criteria for acceptance have been satisfied.

A receivable is recognized when the goods are delivered as this is the point in time that the Group has a right to an amount of consideration that is unconditional.

● Financing components

The Group does not expect to have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence, the group does not adjust any of the transaction prices for the time value of money.

(p) Government grants

The Group recognizes an unconditional government grant related to salary and operating in profit or loss as operating revenue when the grant becomes receivable. Grants that compensate the Group for expenses or losses incurred are recognized in profit or loss on a systematic basis in the periods in which the expenses or losses are recognized.

(Continued)

24

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(q) Employee benefits

• (i) Defined contribution plans

Obligations for contributions to defined contribution plans are expensed as the related service is provided.

• (ii) Defined benefit plans

The Group’s net obligation in respect of defined benefit plans is calculated separately for each the plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Group, the recognized asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in other comprehensive income, and accumulated in retained earnings within equity. The Group determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability (asset). Net interest expense and other expenses related to defined benefit plans are recognized in profit or loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognized immediately in profit or loss. The Group recognizes gains and losses on the settlement of a defined benefit plan when the settlement occurs.

(iii) Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(Continued)

25

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(r) Share-based payment

The grant-date fair value of equity-settled share-based payment arrangements granted to employees is generally recognized as an expense, with a corresponding increase in equity, over the vesting period of the awards. The amount recognized as an expense is adjusted to reflect the number of awards for which the related service and non-market performance conditions are expected to be met, such that the amount ultimately recognized is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant-date fair value of the share-based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

The fair value of the amount payable to employees in respect of share appreciation rights, which are settled in cash, is recognized as an expense with a corresponding increase in liabilities, over the period during which the employees become unconditionally entitled to payment. The liability is remeasured at each reporting date and at settlement date based on the fair value of the share appreciation rights. Any changes in the liability are recognized in profit or loss.

(s)

Income taxes

Income taxes comprise current taxes and deferred taxes. Except for expenses related to business combinations or recognized directly in equity or other comprehensive income, all current and deferred taxes are recognized in profit or loss.

Current taxes comprise the expected tax payables or receivables on the taxable profits (losses) for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payables or receivables are the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes. It is measured using tax rates enacted or substantively enacted at the reporting date.

Deferred taxes arise due to temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax bases. Deferred taxes are recognized except for the following:

• (i) Temporary differences on the initial recognition of assets and liabilities in a transaction that is not a business combination and at the time of the transaction (i) affects neither accounting nor taxable profits (losses) and (ii) does not give rise to equal taxable and deductible temporary differences;

• (ii) Temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that the Group is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and

(iii) Taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets are recognized for the carry forward of unused tax losses, unused tax credits, and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefits will be realized.

(Continued)

26

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Deferred taxes are measured at tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are offset if the following criteria are met:

• (i) the Group has a legally enforceable right to set off current tax assets against current tax liabilities; and

• (ii) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on either:

• 1) the same taxable entity; or

• 2) different taxable entitie which intend to settle current tax assets and liabilities on a net basis, or to realize the assets and liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

(t) Earnings per share

The Group discloses the Company’s basic and diluted earnings per share attributable to ordinary shareholders of the Company. Basic earnings per share is calculated as the profit attributable to ordinary shareholders of the Company divided by the weighted average number of ordinary shares outstanding. Diluted earnings per share is calculated as the profit attributable to ordinary shareholders of the Company divided by the weighted average number of ordinary shares outstanding after adjustment for the effects of all potentially dilutive ordinary shares, such as Sharebased payment.

(u) Operating segments

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the Group). Operating results of the operating segment are regularly reviewed by the Group’s chief operating decision maker to make decisions about resources to be allocated to the segment and to assess its performance. Each operating segment consists of standalone financial information.

(5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty:

In preparing these consolidated financial statements, management has made judgments, estimates, and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income, and expenses. Actual results may differ from these estimates.

The management continues to monitor the accounting estimates and assumptions. The management recognizes any changes in accounting estimates during the period and the impact of those changes in accounting estimates in the following period.

(Continued)

27

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Information about judgments made in applying accounting policies that have the most significant effects on the amounts recognized in the consolidated financial statements is as follows:

Judgement of whether the Group has substantive control over its investees

The Group holds 13.21% of the outstanding voting shares of Fulltech Fiber Glass Corp. and is the single largest shareholder of the investee. Although the remaining 86.79% of Fulltech Fiber Glass Corp.’s shares are not concentrated within specific shareholders, the Group still cannot obtain more than half of the total number of Fulltech Fiber Glass Corp.’s directors, and it also cannot obtain more than half of the voting rights at a shareholders’ meeting. Therefore, it is determined that the Group has significant influence on Fulltech Fiber Glass Corp.

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year is as follows. Those assumptions and estimation have been updated to reflect the impact of COVID-19 pandemic:

Evaluation of inventories

Since inventory must be measured at the lower of cost and net realizable value, the Group assesses the amount of inventory due to normal wear and tear, obsolescence, or no market sales value on the reporting date, and offsets the inventory cost to net realizable value. This inventory evaluation is mainly based on the estimated product demand in a specific period in the future, so there may be major changes due to rapid changes in the industry. Please note 6(e) for detailed inventory evaluation and estimation.

The Group’s accounting policies include measuring financial and non financial assets and liabilities at fair value. The Group has established an internal control framework with respect to the measurement of fair value and regularly reviews significant unobservable inputs and valuation adjustments. If third-party information, such as broker quotes or pricing services, is used to measure fair value, then the Group assessed the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of IFRSs, including the level in the fair value hierarchy in which such valuations should be classified.

The Group strives to use market observable inputs when measuring assets and liabilities. Different levels of the fair value hierarchy to be used in determining the fair value of financial instruments are as follows:

• (a) Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

• (b) Level 2: 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).

• (c) Level 3: inputs for the assets or liability that are not based on observable market data.

For any transfer within the fair value hierarchy, the impact of the transfer is recognized on the reporting date. Please refer to note 6(w) for assumptions used in measuring fair value.

(Continued)

28

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(6) Explanation of significant accounts

• (a) Cash and cash equivalents

Cash in stock Bank deposits Time deposits	December 31, 2023 $ 1,694 797,797 66,968 $ 866,459	December 31, 2022
		1,790 680,952 61,420
		744,162

Please refer to note 6(w) for the exchange rate risk, interest rate risk, and sensitivity analysis of the financial assets and liabilities of the Group.

• (b) Financial assets at fair value through profit or loss

Mandatorily measured at fair value through profit or loss: Open End Funds Financial products	December 31, 2023 $ 20,481 - $ 20,481	December 31, 2022
		14,295 89,167
		103,462

For the years ended December 31, 2023 and 2022, the net profit of the financial assets at fair value through profit or loss of the Group were $437 thousand and $1,926 thousand, respectively.

For the years ended December 31, 2023 and 2022, the Group held the financial products from bank with expected return rate ranging from 1.65%~2.55% and 1.35%~2.85%, respectively.

As of December 31, 2023 and 2022, the financial assets at financial assets at fair value through profit or loss of the Group had not been pledged.

• (c) Financial assets at fair value through other comprehensive income

Listed common shares Unlisted common shares	December 31, 2023 $ 339,660 96,092 $ 435,752	December 31, 2022
		561,000 109,766
		670,766

• (i) Equity investments at fair value through other comprehensive income

The Group designated the investments shown above as equity securities at fair value through other comprehensive income because these equity securities represent those investments that the Group intends to hold for long-term strategic purposes.

There were no disposals of strategic investments and transfers of any cumulative gain or loss within equity relating to these investments for the years ended December 31, 2023 and 2022.

(Continued)

29

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• (ii) For credit risk (including the impairment of debt investments) and market risk, please refer to note 6(w).

• (iii) As of December 31, 2023 and 2022 the financial assets at fair value through other comprehensive income of the Group had not been pledged.

(d) Notes and accounts receivables

Notes receivables Accounts receivables Less: Loss allowance	December 31, 2023 $ 11,815 4,035,734 (12,529) $ 4,035,020	December 31, 2022 11,289 4,338,089 (2,162) 4,347,216

The Group applies the simplified approach to provide for its expected credit losses, i.e. the use of lifetime expected loss provision for all receivables. To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due, as well as the incorporated forward-looking information, including that of macroeconomic and relevant industry information. The loss allowance provisions were determined as follows:

Current 1 to 90 days past due 91 to 180 days past due More than 181 days past due Current 1 to 90 days past due 91 to 180 days past due More than 181 days past due	December 31, 2023	December 31, 2023
	Gross carrying amount Weighted-average loss rate $ 3,676,960 0.04% 353,618 1.37% 15,388 30.04% 1,583 98.86% $ 4,047,549 December 31, 2022		Loss allowance provision
			1,489 4,853 4,622 1,565
			12,529
		Weighted-average loss rate 0.00% 0.08% 0.70% 56.97%	Loss allowance provision
			77 204 9 1,872
			2,162

(Continued)

30

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

The movement in the allowance for notes and accounts receivables were as follows:

Balance at January 1 Impairment losses recognized Impairment losses reversed Amounts written off Balance at December 31	For the years ended December 31 2023 2022 $ 2,162 22,971 13,005 - - (19,458) (2,638) (1,351) $ 12,529 2,162
	2023 $ 2,162 13,005 - (2,638) $ 12,529

As of December 31, 2023 and 2022, notes and accounts receivables of the Group had not been pledged.

(e) Inventories

Raw materials and consumables Work in progress Finished goods Merchandise inventory Allowance to reduce inventory to market	December 31, 2023 $ 348,529 1,200,470 542,693 435,534 2,527,226 (179,374) $ 2,347,852	December 31, 2022 412,006 1,435,908 607,072 494,910 2,949,896 (229,607) 2,720,289

For the years ended December 31, 2023 and 2022, the Group recognized the cost of sales of $14,023,172 thousand and $15,681,722 thousand, respectively.

The details of the cost of sales were as follow:

Reversal of write downs of inventories Revenue from sales of scraps	2023 $ (49,684) (366,665) $ (416,349)	2022 (31,176) (409,804) (440,980)

As of December 31, 2023 and 2022, inventories of the Group had not been pledged.

(Continued)

31

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(f) Non-current assets held for sale

On March 13, 2023, the Group entered into a sales and purchase agreement with an outside buyer to dispose its idle plants and dormitories in Yilan, for a total contract price of $677,078 thousand, based on a resolution approved during its board meeting held on March 3, 2023. The above transaction was completed on May 12, 2023, resulting in a gain on disposal of $200,629 thousand to be recognized as other gains and losses.

(g) Investments accounted for using equity method

A summary of the Group’ s financial information for investments accounted for using the equity method at the reporting date is as follows:

method at the reporting date is as follows:
Associates	December 31, 2023 $ 912,683	December 31, 2022
		1,039,704

(i) Associates

The Group’s financial information for investments accounted for using the equity method that were individually insignificant were as follows:

were individually insignificant were as follows:
Carrying amount of individually insignificant associates’ equity	December 31, 2023 $ 912,683	December 31, 2022
		1,039,704

In 2023 and 2022, the Group’s share of the net income of associates were as follows:

Attributable to the Group: Profit (loss) from continuing operations Other comprehensive income Comprehensive income	2023 $ (87,664) (31,505) $ (119,169)	2022
		3,379 23,430
		26,809

(ii) Guarantee

As of December 31, 2023 and 2022, investments accounted for using the equity method of the Group had been pledged as collateral. Please refer to note 8.

(Continued)

32

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(h) Property, plant, and equipment

The cost, depreciation, and impairment of the property, plant and equipment of the Group for the years ended December 31, 2023 and 2022, were as follows:

Cost or deemed cost: Balance at January 1, 2023 Additions Disposals Reclassification Effect of movements in exchange rates Balance at December 31, 2023 Balance at January 1, 2022 Additions Disposal Reclassification Effect of movements in exchange rates Balance at December 31, 2022 Deprecation and impairments loss: Balance at January 1, 2023 Deprecation Disposal Reclassification Effect of movements in exchange rates Balance at December 31, 2023 Balance at January 1, 2022 Deprecation Disposal Effect of movements in exchange rates Balance at December 31, 2022 Carrying Value: Balance on December 31, 2023 Balance on January 1, 2022 Balance on December 31, 2022	Land $ 407,228 - - 166,697 - $ 573,925 $ 407,228 - - - - $ 407,228 $ - - - - - $ - $ - - - - $ - $ 573,925 $ 407,228 $ 407,228	Buildings and constructions 5,885,080 - - (22,170) (56,899) 5,806,011 5,657,686 6,249 - 173,404 47,741 5,885,080 1,052,710 221,515 - (162,297) (6,012) 1,105,916 846,312 205,731 - 667 1,052,710 4,700,095 4,811,374 4,832,370	Machinery equipment 14,499,024 - (163,438) 711,970 (42,555) 15,005,001 14,259,952 - (321,411) 529,611 30,872 14,499,024 9,348,823 941,177 (156,921) - (8,807) 10,124,272 8,740,690 917,456 (311,275) 1,952 9,348,823 4,880,729 5,519,262 5,150,201	Office facilities 328,834 - (6,821) 23,067 (201) 344,879 331,245 - (16,061) 13,493 157 328,834 270,169 22,284 (6,817) - (109) 285,527 265,194 20,863 (15,923) 35 270,169 59,352 66,051 58,665	Other facilities 4,910,742 3,102 (243,617) 228,097 (260) 4,898,064 4,823,385 - (18,377) 105,511 223 4,910,742 3,804,277 282,139 (243,218) - (176) 3,843,022 3,549,085 272,462 (17,418) 148 3,804,277 1,055,042 1,274,300 1,106,465	Testing equipment 515,829 39,629 - (275,770) - 279,688 280,840 640,582 - (405,593) - 515,829 - - - - - - - - - - - 279,688 280,840 515,829	Construction in progress 474,976 158,270 - (467,526) (3,909) 161,811 656,735 285,735 - (478,312) 10,818 474,976 - - - - - - - - - - - 161,811 656,735 474,976	Total 27,021,713 201,001 (413,876) 364,365 (103,824) 27,069,379 26,417,071 932,566 (355,849) (61,886) 89,811 27,021,713 14,475,979 1,467,115 (406,956) (162,297) (15,104) 15,358,737 13,401,281 1,416,512 (344,616) 2,802 14,475,979 11,710,642 13,015,790 12,545,734

(i) Guarantee

As of December 31, 2023 and 2022, the property, plant and equipment of the Group had been pledged as collateral for short-term and long-term borrowings. Please refer to note 8.

(Continued)

33

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(ii) Acquisition of machinery and equipment

The Group calculated capitalization interest rate base on 1.75%~4.81% and 1.76%~3.73% for the years ended December 31, 2023 and 2022. The capitalized borrowing related to the acquisition of machinery and equipment were $50,727 thousand and $82,998 thousand, respectively.

(i) Right-of-use-assets

The Group leases many assets including land and buildings, office facilities and transportation facilities. Information about leases per which the Group as a lease was represented below:

Cost: Balance at January 1, 2023 Additions Disposal Effect on movements of exchange rates Balance at December 31, 2023 Balance at January 1, 2022 Additions Disposal Effect on movements of exchanges rates Balance at December 31, 2022 Accumulated depreciation: Balance at January 1, 2023 Deprecation Disposal Effect on movements of exchange rates Balance at December 31, 2023 Balance at January 1, 2022 Depreciation Disposal Effect on movements of exchange rates Balance at December 31, 2022 Carrying amount: Balance at December 31, 2023 Balance at January 1, 2022 Balance at December 31, 2022	Land $ 571,333 482,890 (636,572) (2,487) $ 415,164 $ 569,056 - - 2,277 $ 571,333 $ 205,838 30,093 (87,272) (264) $ 148,395 $ 156,190 49,497 - 151 $ 205,838 $ 266,769 $ 412,866 $ 365,495	Buildings and constructions 151,268 64,772 (148,371) - 67,669 157,358 11,325 (17,415) - 151,268 131,672 29,629 (147,529) - 13,772 108,357 40,730 (17,415) - 131,672 53,897 49,001 19,596	Office facilities 16,187 701 - - 16,888 17,498 2,830 (4,141) - 16,187 8,421 4,123 - - 12,544 8,037 3,657 (3,273) - 8,421 4,344 9,461 7,766	Transportation facilities 48,760 6,993 (403) - 55,350 49,319 10,527 (11,086) - 48,760 18,491 12,092 (403) - 30,180 18,152 11,425 (11,086) - 18,491 25,170 31,167 30,269	Other assets 19,696 16,341 (1,694) - 34,343 20,425 1,991 (2,720) - 19,696 11,208 5,613 (1,477) - 15,344 9,143 4,785 (2,720) - 11,208 18,999 11,282 8,488	Total 807,244 571,697 (787,040) (2,487) 589,414 813,656 26,673 (35,362) 2,277 807,244 375,630 81,550 (236,681) (264) 220,235 299,879 110,094 (34,494) 151 375,630 369,179 513,777 431,614

As of December 31, 2023 and 2022, the Right-of-use-assets of the Group had been pledged as collateral for long-term borrowings. Please refer to note 8.

(Continued)

34

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(j) Intangible assets

The cost and amortization of the intangible assets of the Group for the years ended December 31, 2023 and 2022, were as follows:

Costs: Balance at January 1, 2023 Additions Disposals Balance at December 31, 2023 Balance at January 1, 2022 Additions Balance at December 31, 2022 Accumulated amortization: Balance at January 1, 2023 Amortization Disposals Balance at December 31, 2023 Balance at January 1, 2022 Amortization Balance at December 31, 2022 Carrying amount: Balance at December 31, 2023 Balance at January 1, 2022 Balance at December 31, 2022

Computer Software $ 196,160 12,537 (6,995) $ 201,702 $ 146,753 49,407 $ 196,160 $ 58,090 27,123 (6,995) $ 78,218 $ 34,082 24,008 $ 58,090 $ 123,484 $ 112,671 $ 138,070

(i) Amortization

The amortization of intangible assets were included in the statement of comprehensive income:

Cost of sales Operating expense	2023 $ 4,310 $ 22,813	2022
		3,928
		20,080

(Continued)

35

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(k) Short-term borrowings

The short-term borrowings were summarized as follows:

Letters of credit Unsecured bank loans Secured bank loans Total Unused short-term credit lines Range of interest rates	December 31, 2023 $ - 1,863,190 150,000 $ 2,013,190 $ 5,169,973 1.82%~4.09%	December 31, 2022
		17,081 1,510,484 100,050
		1,627,615
		3,798,213
		0.79%~6.29%

For the collateral for short-term borrowings, please refer to note 8.

• (l) Other payables

Expenses Payable Salary payables Equipment payables Others Total	December 31, 2023 $ 492,937 199,143 178,560 149,135 $ 1,019,775	December 31, 2022 567,472 182,370 227,734 173,520
		1,151,096

• (m) Long-term borrowings

The long-term borrowings were summarized as follows:

Unsecured bank loans Secured bank loans Less: current portion Total Unused long-term credit lines		December 31, 2023 Rate Maturity year Amount 2.01%~2.55% 2024~2027 $ 361,500 4.2% 2024 1,164,376 1.95%~2.84% 2026~2028 4,307,820 5,833,696 (1,812,496) $ 4,021,200 $ 757,021
	Currency	Rate
	TWD CNY TWD	2.01%~2.55% 4.2% 1.95%~2.84%

(Continued)

36

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Unsecured bank loans Secured bank loans Other long-term payable Less: current portion Total Unused long-term credit lines		December 31, 2022 Rate Maturity year Amount 1.22%~6.15% 2023 $ 675,620 1.66%~2.17% 2023~2027 290,000 4.60% 2024 1,798,083 1.10%~2.42% 2025~2027 3,844,940 6.44% 2023 96,583 6,705,226 (2,414,093) $ 4,291,133 $ 659,709
	Currency	Rate
	USD TWD CNY TWD USD	1.22%~6.15% 1.66%~2.17% 4.60% 1.10%~2.42% 6.44%

• (i) Collateral for long-term borrowings

For the collateral for long-term borrowings, please refer to note 8.

• (ii) The details of loans are as follows:

• 1) The Group entered into a syndicated credit agreement (hereafter referred to as syndicated credit agreement) with a group of banks leading by Bank of Taiwan on March 27, 2023, the principal contents of which are summarized below:

  • a) The group of banks consists of:

Bank of Taiwan (leading bank, credit facility management bank and secured equity interest management bank), Changhwa Commercial Bank, Taiwan Business Bank, Taiwan Cooperative Bank, First Commercial Bank (the aforementioned banks are the joint leading banks), Land Bank of Taiwan, Mega International Commercial Bank, Taipei Fubon Commercial Bank, Bank SinoPac and The Shanghai Commercial & Savings Bank.

• i) The total credit facility is NT$3.6 billion to meet the borrower’s repayment of existing financial institution liabilities and to enhance the borrower’s mediumterm working capital.

ii) The credit duration, the withdrawn period and the settlement method:

1. This credit duration: five years from the date of first withdrawn (of which credit A includes a grace period of 18 months). The first use of loan by borrower must be before May 20, 2023, otherwise that date shall be deemed to be the first draw-up date.

2. Withdrawn period of this credit:

3. a. Credit A: It is a medium-term (secured) loan, and the credit facility amounted to NT$2.4 billion may be withdrawn for multiple times but not on a recurring basis. The withdrawn period of credit A is six months from its first withdrawn, and upon the expiry of the Credit A, the unused Credit A facility is automatically canceled and cannot be used again.

(Continued)

37

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• b. Credit B: It is a medium-term loan, and the credit facility amounted to NT$1.2 billion may be withdrawn for multiple times and on a recurring basis.

3. Settlement method:

• a. Credit A: The first repayment date of this credit shall be the date on which 18 months have elapsed from first withdrawn date, and every six months thereafter shall be deemed as a repayment period, then the credit is amortized in total of eight installments. The principal balance of credit A outstanding at the expiration of withdrawn period shall be evenly repaid in each repayment date.

• b. Credit B: To fully settle the principal of credit that has been withdrawn upon its expiration according to the credit period of each loan appropriated and to withdraw the outstanding principal balance on a recurring basis as agreed in this credit. When the outstanding principal balance is used on a recurring basis, the newly appropriated amount shall be able to directly pay for the portion already due.

In any situation, the Group shall fully settle all its outstanding principal, interests and other payables and expenses upon the expiration of this credit.

• iii) Under the syndicated credit agreement, the Group shall provide, during the credit period, the audited annual consolidated financial statements and the consolidated financial statements for the first, second and third quarters as reviewed by the accountants. Restrictions rules on specific financial ratios such as current ratio, debt ratio, interest protection multiplier and tangible net value shall be calculated based on the consolidated annual financial statements audited by the accountants. It shall be inspected one time per year or as often as the management Bank deems necessary.

• iv) The above borrowings are provided by the Group with promissory notes, machinery and equipment, factory and building as collateral for this credit case and the related parties are acting as joint guarantors.

v) The Group made its first withdrawn on April 28, 2023.

• 2) The Group entered into a syndicated credit agreement (hereafter referred to as syndicated credit agreement) with a group of banks leading by Bank of Taiwan on September 26, 2019, the principal contents of which are summarized below: A. The group of banks consists of:

Bank of Taiwan (leading bank, credit facility management bank and secured equity interest management bank), Taishin International Bank, Changhwa Commercial Bank, Taiwan Business Bank, Bank SinoPac, The Shanghai Commercial & Savings Bank and First Commercial Bank.

• i) The total credit facility is US$24 million to enhance the borrower’ s working capital.

(Continued)

38

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

ii) The credit duration, the withdrawn period and the settlement method:

1. This credit duration: Four years from the first draw-up date, but should be used within three months after the contract date.

2. Withdrawn period of this credit:

On the regulation of agreement and under each condition, the period of using is 9 months from the first draw-up date. After the maturity date, the unused amount will be cancelled automatically and shall not be used.

1. Settlement method:

The first repayment date of this credit shall be the date on which 12 months have elapsed from first withdrawn date, and every six months thereafter shall be deemed as a repayment period, then the credit is amortized in total of five installments. From first payment to fourth payment, the Group should pay the principal of 12.5%. It will be extended for one year from November 18, 2022, and thereafter every three months is deemed as one payment. The fifth and sixth instalments will amortize the principal of US$3.6 million. The seventh and eighth instalments will each the principal of US$2.4 million will be repaid periodically.

In any situation, the borrowing should be repaid based on the contract within the time and amount. If not, the borrowings should be fully repaid ahead of schedule.

The Group shall fully settle all its outstanding principal, interests and other payables and expenses upon the expiration of this credit.

• iii) Under the syndicated credit agreement, the Group shall provide, during the credit period, the audited annual consolidated financial statements and the interim consolidated financial statements as reviewed by the accountants and maintain certain financial ratios such as current ratio, debt ratio, interest protection multiplier and tangible net value. It shall be inspected one time per year or as often as the management Bank deems necessary.

• iv) The related parties provided the above borrowings with promissory notes, while acting as the join guarantors

• v) The Group made its first withdrawn on November 18, 2019.

• vi) The Group made the full payment on October 20, 2023.

• 3) The Group entered into a syndicated credit agreement (hereafter referred to as syndicated credit agreement) with a group of banks leading by Bank of Taiwan on March 31, 2020, the principal contents of which are summarized below:

(Continued)

39

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• a) The group of banks consists of:

Bank of Taiwan (leading bank, credit facility management bank and secured equity interest management bank), Changhwa Commercial Bank, Taiwan Business Bank, Land Bank of Taiwan, Taiwan Cooperative Bank, First Commercial Bank (the aforementioned banks are the joint leading banks), Bank SinoPac, The Shanghai Commercial & Savings Bank, Taipei Fubon Commercial Bank and Mega International Commercial Bank.

• i) The total credit facility is NT$3.8 billion to meet the borrower’s repayment of existing financial institution liabilities and to enhance the borrower’s mediumterm working capital.

ii) The credit duration, the withdrawn period and the settlement method:

1. This credit duration: Five years from the date of first withdrawn (of which credit A includes a grace period of 18 months). The borrower shall be used within 6 months from the contract date, otherwise that the 6 month date from the contract date will be deemed as the first draw-up date.

2. Withdrawn period of this credit:

3. a. Credit A: It is a medium-term (secured) loan, and the credit facility amounted to NT$2.9 billion may be withdrawn for multiple times but not on a recurring basis. The withdrawn period of credit A is six months from its first withdrawn, and upon the expiry of the Credit A, the unused Credit A facility is automatically canceled and cannot be used again.

4. b. Credit B: It is a medium-term loan, and the credit facility amounted to NT$900 million may be withdrawn on a recurring basis.

5. Settlement method:

6. a. Credit A: The first repayment date of this credit shall be the date on which 18 months have elapsed from first withdrawn date, and every six months thereafter shall be deemed as a repayment period, then the credit is amortized in total of eight installments. The principal balance of credit A outstanding at the expiration of withdrawn period shall be evenly repaid in each repayment date.

7. b. Credit B: To fully settle the principal of credit that has been withdrawn upon its expiration according to the credit period of each loan appropriated and to withdraw the outstanding principal balance on a recurring basis as agreed in this credit. When the outstanding principal balance is used on a recurring basis, the newly appropriated amount shall be able to directly pay for the portion already due.

In any situation, the Group shall fully settle all its outstanding principal, interests and other payables and expenses upon the expiration of this credit.

(Continued)

40

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

iii) Under the syndicated credit agreement, the Group shall provide, during the credit period, the audited annual consolidated financial statements and the consolidated financial statements for the first, second and third quarters as reviewed by the accountants. Restrictions rules on specific financial ratios such as current ratio, debt ratio, interest protection multiplier and tangible net value shall be calculated on the basis of the consolidated annual financial statements audited by the accountants. It shall be inspected one time per year or as often as the management Bank deems necessary.

• iv) The above borrowings are provided by the Group with promissory notes, machinery and equipment, factory and building as collateral for this credit case and the related parties are acting as joint guarantors.

• v) The Group made its first withdrawn on April 30, 2020.

vi) The Group made the full payment on April 28, 2023.

(n) Lease liabilities

The carrying values of the Group’s lease liabilities were as follows:

The carrying values of the Group’s lease liabilities were as fol	lows:
Current Non-current For the maturity analysis, please refer to note 6(w). The amounts recognized in profit or loss was as follows: Interest on lease liabilities Expenses relating to leases of low value assets and short term leases The amounts recognized in the statement of cash flows for the Total cash outflow for leases	December 31, 2023 December 31, 2022 $ 80,374 86,315 $ 163,366 228,988 2023 2022 $ 4,576 6,721 $ 10,928 16,392 Group was as follows: 2023 2022 $ 110,569 156,412	December 31, 2022
		86,315
		228,988
		2022
		6,721
		16,392
		156,412

(i) Real estate leases

The Group leases land and buildings for its office space and employee accommodation. The leases of office space and employee accommodation typically run for two to ten years. Some leases include an option to renew the lease for an additional period of the same duration after the end of the contract term.

The Group expects the relative proportions of fixed and variable lease payments to remain broadly consistent in future years.

(Continued)

41

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(ii) Other leases

The Group leases office facilities and transportation facilities, with lease terms of one to four years. In some cases, the Group has options to purchase the assets at the end of the contract term; in other cases, it guarantees the residual value of the leased assets at the end of the contract term.

The Group also leases office facilities and parking space with lease terms of one to four years. These leases are short term or leases of low value items. The Group decides to apply recognition exemption, and has selected not to recognize right-of-use assets and lease liabilities for these leases.

(o) Employee benefits

(i) Defined benefit plans

Reconciliation of defined benefit obligation at present value and plan asset at fair value are as follows:

Present value of the defined benefit obligations Fair value of plan assets Net defined benefit liabilities	December 31, 2023 $ 682,157 (540,194) $ 141,963	December 31, 2022 695,292 (500,829) 194,463

The Group makes defined benefit plan contributions to the pension fund account with Bank of Taiwan that provides pensions for employees upon retirement. Plans (covered by the Labor Standards Law) entitle a retired employee to receive retirement benefits based on years of service and average monthly salary for the six months prior to retirement.

1) Composition of plan assets

The Group allocates pension funds in accordance with the Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund, and such funds are managed by the Bureau of Labor Funds, Ministry of Labor. With regard to the utilization of the funds, minimum earnings shall be no less than the earnings attainable from two-year time deposits with interest rates offered by local banks.

The Group’ s Bank of Taiwan labor pension reserve account balance amounted to $540,194 thousand and $500,829 thousand as of December 31, 2023 and 2022. For information on the utilization of the labor pension fund assets, including the asset allocation and yield of the fund, please refer to the website of the Bureau of Labor Funds, Ministry of Labor.

(Continued)

42

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

2) Movements in present value of the defined benefit obligations

The movement in present value of the defined benefit obligations for the Group were as follows:

Defined benefit obligations at January 1 Current service costs and interest cost Remeasurements loss －Actuarial loss arising from: －Financial assumptions Benefits paid Defined benefit obligations at December 31	2023 $ 695,292 21,289 3,708 (38,132) $ 682,157	2022 628,409 15,723 95,345 (44,185) 695,292

• 3) Movements of defined benefit plan assets

The movements in the present value of the defined benefit plan assets for the Group were as follows:

Fair value of plan assets at January 1 Interest income Remeasurements loss: －Return on plan assets excluding interest income Benefits paid Contributions paid by the employer Fair value of plan assets at December 31	2023 $ 500,829 8,283 2,841 66,373 (38,132) $ 540,194	2022 466,716 4,426 35,671 38,201 (44,185) 500,829

• 4) Movements of the effect of the asset ceiling

There were no movements in the number of impacts of the Group’s defined benefit plan asset ceiling in 2023 and 2022.

• 5) Expenses recognized in profit or loss

The expenses recognized in profit or loss for the Group were as follows:

Current service costs Net interest of net liabilities for defined benefit obligations Operating cost Operating expense	2023 $ 9,510 3,496 $ 13,006 2023 $ 2,956 10,050 $ 13,006	2022 9,439 1,858 11,297 2022 3,107 8,190 11,297 (Continued)

43

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

6) Actuarial assumptions

The principal actuarial assumptions at the reporting date were as follows:

Discount rate Future salary increase rate	December 31, 2023 December 31, 2023 1.222% 1.694% 1.000% 1.000%

The expected allocation payment to be made by the Group to the defined benefit plans for the one-year period after the reporting date is $30,226 thousand.

The weighted average lifetime of the defined benefits plans is 9.93 years.

7) Sensitivity analysis

If the actuarial assumptions had changed, the impact on the present value of the defined benefit obligation shall be as follows:

December 31,2023 Discount rate Future salary increasing(decreasing) rate December 31,2022 Discount rate Future salary increasing(decreasing) rate	Influences of defined benefit obligations Increased0.25％ Decreased0.25％ (16,322) 16,897 16,721 (16,231) (17,035) 17,648 17,542 (17,013)

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown above. The method used in the sensitivity analysis is consistent with the calculation of pension liabilities in the balance sheets.

There is no change in the method and assumptions used in the preparation of sensitivity analysis for 2023 and 2022.

(ii) Defined contribution plans

The Company and DA-TAI Investment allocated 6% of each employee’ s monthly wages to the labor pension personal account at the Bureau of Labor Insurance in accordance with the provisions of the Labor Pension Act. Under these defined contribution plans, the Company and DA-TAI Investment allocated a fixed amount to the Bureau of Labor Insurance without additional legal or constructive obligation.

(Continued)

44

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Under the defined contribution plans of both foreign subsidiaries, Shanghai Zhanhua and Shanghai Zhanhua (Nantong), both subsidiaries were required to contribute monthly certain amounts (as insurance) into their employees’ independent personal pension accounts. The contributions to these plans were expensed as incurred.

For the years ended December 31, 2023 and 2022, the pension costs incurred from the contributions to both the Bureau of the Labor Insurance and employees’ independent personal pension accounts of both foreign subsidiaries amounted to $202,796 thousand and $209,965 thousand, respectively.

(p) Income tax

• (i) Income tax expense (income)

The components of income tax expense (income) were as follows:

Current tax expense (income) Current period Adjustments for prior periods Deferred tax expense (income) Origination and reversal of temporary differences Income tax (income) expense	2023 $ 143 (378) (235) (88) $ (323)	2022
		553 6,243
		6,796
		14,969
		21,765

• (ii) Reconciliation of income tax expenses (income) and profit (loss) before tax for 2023 and 2022 is as follows:

		2023		2022
(Loss) profit excluding income tax	$	(344,564)		435,091
Income tax using the Company’s domestic tax rate		(68,913)		87,018
Effect of tax rates in foreign jurisdiction			15,279	(3,015)
Tax-exempt income			(1,380)	(258)
Non-deductible expenses			3,193	-
Prior-period tax adjustments			(378)	6,243
Recognition of previously unrecognized tax losses		(47,265)		(66,000)
Current-year losses for which no deferred tax asset		111,328		15,880
was recognized
Change in unrecognized temporary differences			(7,290)	(7,389)
Others			(4,897)	(10,714)
Income tax (income) expense	$		(323)	21,765

(Continued)

45

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• (iii) Deferred tax assets and liabilities

• 1) Unrecognized deferred tax liabilities

The Group is able to control the timing of the reversal of the temporary differences associated with investments in subsidiaries as of December 31, 2023 and 2022. Also, management considers it probable that the temporary differences will not reverse in the foreseeable future. Hence, such temporary differences are not recognized under deferred tax liabilities. Details are as follows:

tax liabilities. Details are as follows:
December 31, 2023 Aggregate amount of temporary differences related to investments in subsidiaries $ 1,529,699 Unrecognized deferred tax liabilities $ 305,940 2) Unrecognized deferred tax assets	December 31, 2022
	1,220,361
	244,072

Deferred tax assets have not been recognized in respect of the following items:

Tax effect of deductible temporary differences The carryforward of unused tax losses	December 31, 2023 $ 48,533 439,342 $ 487,875	December 31, 2022
		55,823 422,290
		478,113

The R.O.C. Income Tax Act allows net losses, as assessed by the tax authorities, to offset taxable income over a period of ten years for local tax reporting purposes.

Deferred tax assets have not been recognized in respect of these items because it is not probable that future taxable profit will be available against which the Group can utilize the benefits therefrom.

Since Shanghai Unitech Electronics (Nantong) Co., Ltd. met the requirements of hightech enterprises that need support from the government according to “Enterprise Income Tax Law of the People’s Republic of China”, its tax losses have been reduced to 15% beginning from 2022 and were allowed to be carried forward its net losses to offset against its income over a period of five years.

As of December 31, 2023, the information of the Company’s unused tax losses for which no deferred tax assets were recognized are as follows:

Year of loss	Unused tax loss Expiry date $ 1,088,850 2030 1,757,481 2031 541,467 2033 $ 3,387,798
2020 (approved) 2021 (approved) 2023 (estimated)

(Continued)

46

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

3) Recognized deferred tax assets and liabilities

Changes in the amount of deferred tax assets and liabilities for 2023 and 2022 were as follows:

Deferred Tax Assets: Balance at January 1, 2023 Recognized in profit or loss Exchange Differences Balance at December 31, 2023 Balance at January 1, 2022 Recognized in profit or loss Exchange Differences Balance at December 31, 2022 Deferred tax liabilities: Balance at December 31, 2023 (Balance at January 1, 2023) Balance at January 1, 2022 Recognized in profit or loss Balance at December 31, 2022	Loss carryforward $ 289,236 (1,650) (720) $ 286,866 $ 310,359 (25,498) 4,375 $ 289,236 Revaluation surplus of land $ 171,517 $ 171,517 - $ 171,517	Others 14,140 1,738 (84) 15,794 10,397 7,512 (3,769) 14,140 Other 3,017 (3,017) -	Total 303,376 88 (804) 302,660 320,756 (17,986) 606 303,376 Total 171,517 174,534 (3,017) 171,517

(iv) The Company’s income tax return for the year 2021 had been examined by the tax authorities.

(q) Capital and other equity

As of December 31, 2023 and 2022, the number of authorized ordinary shares were 800,000 thousand shares with par value of $10 per share. The total value of authorized ordinary shares was amounted to $8,000,000 thousand. As of that date, 669,407 thousand of ordinary shares were issued. All issued shares were paid up upon issuance.

(i) Ordinary shares

On March 30, 2022, the Board of Directors resolved to issue $500,000 thousand with par value of $10 per share, 50,000 thousand shares, at an issue price of $14 per share, for cash. The capital increase has been approved by the Financial Supervisory Commission, and the base date of the capital increase is on August 11, 2022. All payments for the shares have been received, and the relevant registration procedures have been completed.

(Continued)

47

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(ii) Capital surplus

The balances of capital surplus were as follows:

The balances of capital surplus were as follows:
Share premium Changes in equity of investment in associates accounted for using equity method Unclaimed dividend	December 31, 2023 $ 2,879,453 155,284 621 $ 3,035,358	December 31, 2022
		2,879,453 157,189 507
		3,037,149

According to the R.O.C. Company Act, capital surplus can only be used to offset a deficit, and only the realized capital surplus can be used to increase the common stock or be distributed as cash dividends. The aforementioned realized capital surplus includes capital surplus resulting from premium on issuance of capital stock and earnings from donated assets received. According to the Regulations Governing the Offering and Issuance of Securities by Securities Issuers, capital increases by transferring capital surplus in excess of par value should not exceed 10% of the total common stock outstanding.

(iii) Retained earnings

According to the Company’s Article, net earnings should be used to offset the prior year’s deficits, if any, before paying any income taxes. 10% of retained earnings will be as legal reserve. The rest of the amount and undistributed surplus will be allocated on the basis of the allocation plan proposed by the Board of Directors and submitted to stockholders for approval.

Due to demand of expanding business, coordinating with Company’s long-term financial plan for sustainable development and stable economic development, The Group adopts Residual Dividend Policy. The main purpose for this policy is to measure financial demand that based on budget of future capital. The steps of distributions are as below: (1) The best capital budget. (2) Determine the financing required to meet the capital budget in the preceding paragraph. (3) Determine the amount of financing required to be financed by retained surplus (the remaining can be financed by cash increase or corporate bonds). (4) The remaining surplus can be distributed to shareholders in the form of dividends after retaining an appropriate amount according to operational needs. The distribution of future dividends takes into account the use of funds, and draws up an appropriate ratio of cash to stock dividends for the current year, in which cash dividends are 50% to 100%, and stock dividends are 50% to zero.

1) Legal reserve

When a company incurs no loss, it may pursuant to a resolution by a shareholders’ meeting, distribute its legal reserve by issuing new shares or by distributing cash, and only the portion of legal reserve which exceeds 25% of capital may be distributed.

(Continued)

48

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

2) Special reserve

In accordance with the requirements issued by the FSC, a portion of earnings shall be allocated as special reserve during earnings distribution. An equivalent amount of special reserve shall be allocated from the net profit in the period and the undistributed prior period earnings. A portion of undistributed prior-period earnings shall be reclassified to special earnings reserve (and does not qualify for earnings distribution) to account for cumulative changes to the net reduction of other shareholders’ equity pertaining to prior periods. Amounts of subsequent reversals pertaining to the net reduction of other shareholders’ equity shall qualify for additional distributions.

3) Earnings distribution

The earnings distribution for 2022 was resolved by the general meeting of shareholders held on June 15, 2023 as follow:

Dividends distributed to ordinary shareholders: Cash	2022	2022
	Amount per share $ 0.30	Total amount
		200,822

Earnings distribution for 2021 was resolved by the general meeting of shareholders held on June 21, 2022. There was no earnings distribution for the year ended December 31, 2021 due to losses.

• (iv) Other comprehensive income accumulated in reserves, net of tax and non-controlling interest

Balance at January 1, 2023 Exchange differences on foreign operations: The Company Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income: The Company Subsidiary Associate Remeasurement of defined benefits plan: The Company Associate Disposal of investments in equity instruments designated at fair value through other comprehensive income: Associate Balance at December 31, 2023	Exchange differences on translation of foreign financial statements $ 66,843 (89,192) - - - - - - $ (22,349)	Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income 443,927 - (221,340) (13,674) (29,124) - - (868) 178,921	Gains (losses) on remeasurement of defined benefits plan (237,946) - - - - (867) 690 - (238,123)	Total 272,824 (89,192) (221,340) (13,674) (29,124) (867) 690 (868) (81,551) (Continued)

49

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Exchange differences on translation of foreign financial statements Balance at January 1, 2022 $ 33,030 Exchange differences on foreign operations: The Company 33,813 Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income: The Company - Subsidiary - Associate - Remeasurement of defined benefits plan: The Company - Associate - Unearned employee compensation: Associate - Balance at December 31, 2022 $ 66,843	Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income 306,303 - 108,800 14,430 14,394 - - - 443,927	Gains (losses) on remeasurement of defined benefits plan (180,238) - - - - (59,674) 1,966 - (237,946)	Unearned employee compensation (334) - - - - - - 334 -	Total 158,761 33,813 108,800 14,430 14,394 (59,674) 1,966 334 272,824

(r) Shared-based payment

(i) The Company had the following share-based payment in 2022, and there was no such transactions in 2023.

transactions in 2023.
	Total Giving
	Units	Contract Period	Vested
Agreement Giving Day	(Thousand)	(Year)	Condition
Cash capital increase 2022.07.06	5,000	-	Immediately
reserved for			vested
employee
subscription
Information on the cash increase of employee stock option		is as follows:
2022 Cash capital increase of		Units
Employee stock options	(Thousand shares)		Exercise price
Granted during the year (number)		5,000 $	14.00
Exercise during the year (number)		(2,399)	14.00
Expired during the year (number)		(2,601)	14.00
		-
Fair value of stock options per share granted
during the period	$	1.1

• (ii) Information on the cash increase of employee stock option is as follows:

(Continued)

50

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(iii) The Company used the option valuation model to estimate the fair value of the stock options for the former share-based transactions, and the parameters used for the valuation model were as follows:

Share price at grant date Exercise price Expected volatility (%) Expected life of the option Risk-free interest rate (%)	2022
	15.10 14 % 34.46 33 Days % 1.2718

(iv) Employee expense

The Company recognized the operating expenses of $5,500 thousand for the cash increase of employee stock options for the year ended December 31, 2022. There was no such transaction in 2023.

• (s) (Loss) earnings per share

The details on the calculation of basic (loss) earnings per share and diluted (loss) earnings per share as follow:

Basic (loss) earnings per share: (Loss) profit attributable to ordinary shareholders of the Company Weighted average number of ordinary shares (in thousand of shares) Diluted earnings per share: (Loss) profit attributable to ordinary shareholders of the Company Weighted average number of ordinary shares (basic) Effect of employee share bonus Weighted average number of ordinary shares (diluted) (in thousand of shares)	2023 $ (344,241) 669,407 $ (0.51) $ (344,241) 669,407 - 669,407 $ (0.51)	2022
		413,326
		638,996
		0.65
		413,326
		638,996 522
		639,518
		0.65

There are no potential ordinary shareholders which have diluted because loss after tax in 2023.

(Continued)

51

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(t) Revenue from contracts with customers

• (i) Details of revenue

Major products/services lines： 2 Layers 4 Layers 6 Layers 8 Layers More than 10 Layers Others	2023 $ 311,528 1,694,254 2,742,749 4,047,562 6,126,782 37,947 $ 14,960,822	2022
		293,896 1,906,490 3,231,465 3,477,897 8,366,070 147,683
		17,423,501

(ii) Contract balances

Notes receivable Accounts receivable Less: allowance for impairment	December 31, 2023 $ 11,815 4,035,734 (12,529) $ 4,035,020	December 31, 2022 11,289 4,338,089 (2,162) 4,347,216	January 1, 2022 5,510 4,129,691 (22,971) 4,112,230

Please refer to note 6(d) for the disclosure of notes and accounts receivable and their impairment.

• (u) Employee compensation and directors’ remuneration

In accordance with the articles of incorporation the Company should contribute 1% to 5% of the profit as employee compensation and less than 3% as directors’ remuneration when there is profit for the year. However, if the Company has accumulated deficits, the profit should be reserved to offset the deficit.

Due to the loss in 2023, the Company did not accrue the remuneration to employee and directors. For the year ended December 31, 2022, the Company estimated its employee remuneration amounting to $9,000 thousand and directors’ remuneration amounting to $4,500 thousand. The amounts, as stated in the financial statements, are identical to those of the actual distributions for 2022. Relevant information can be inquired at the Public Information Observatory.

(Continued)

52

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(v) Non-operating income and expenses

• (i) Interest income

The details of interest income were as follows:

Interest income from bank deposits Other interest income	2023 $ 15,234 13 $ 15,247	2022
		4,137 3
		4,140

(ii) Other income

The details of other income were as follows:

Compensation income Design income Subsidy Other income Dividend income	2023 $ 21,283 30,231 13,023 18,008 6,898 $ 89,443	2022
		14,663 35,321 20,149 29,152 5,837
		105,122

(iii) Other gains and losses

The details of other gains and losses were as follows:

Foreign exchange gains Gains on lease modification Gains on disposals of non-current assets held for sale Net gains on financial assets at fair value through profit Losses on disposals of property, plant and equipment Miscellaneous disbursements	2023 $ 64,236 41 200,629 437 (5,984) (8,120) $ 251,239	2022
		222,147 - - 1,926 (7,934) (24,575)
		191,564

(Continued)

53

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(iv) Financial costs

The details of finance costs were as follows:

Interest expense on borrowings Handling fee Interest expense on lease liabilities Less: interest capitalization	2023 $ 268,952 2,441 4,576 (50,727) $ 225,242	2022 249,044 3,287 6,721 (82,998) 176,054

(w) Financial instruments

(i) Credit risk

1) Credit risk exposure

The carrying amount of financial assets represents the maximum amount exposed to credit risk.

2) Concentration of Credit risk

The Group has a large customer base, it has not concentrated on transactions with a single customer. Therefore, there was no concentration of credit risk in its trade receivables. To minimize credit risk, the Group periodically evaluates customers’ financial positions.

(ii) Liquidity risk

The following table shows the contractual maturities of financial liabilities, including estimated interest payments and excluding the impact of netting agreements.

December 31, 2023 Non-derivative financial liabilities Short-term borrowings Accounts payable Other payables Leases liabilities Current portion of long-term borrowings Long-term borrowings Guarantee deposits received	Carrying amount $ 2,013,190 2,141,794 1,019,775 243,740 1,812,496 4,021,200 27,785 $ 11,279,980	Contractual cash flows 2,044,556 2,141,794 1,019,775 257,672 1,847,779 4,341,125 27,785 11,680,486	Within 12 months 2,044,556 2,141,794 1,019,775 88,167 1,847,779 105,944 27,785 7,275,800	1-5 years - - - 169,505 - 4,235,181 - 4,404,686	Over 5 years
					- - - - - - -
					-

(Continued)

54

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

December 31, 2022 Non-derivative financial liabilities Short-term borrowings Accounts payable Other payables Lease liabilities Current portion of long-term borrowings Long-term borrowings Guarantee deposits received	Carrying amount $ 1,627,615 2,426,512 1,151,096 315,303 2,414,093 4,291,133 26,271 $ 12,252,023	Contractual cash flows 1,642,888 2,426,512 1,151,096 335,432 2,450,780 4,545,416 26,271 12,578,395	Within 12 months 1,642,888 2,426,512 1,151,096 96,824 2,450,780 112,407 26,271 7,906,778	1-5 years - - - 226,958 - 4,433,009 - 4,659,967	Over 5 years
					- - - 11,650 - - -
					11,650

The Group does not expect the cash flows included in the maturity analysis to occur significantly earlier or at significantly different amounts.

• (iii) Currency risk

• 1) Exposure to foreign currency risk

The Group’s significant exposure to foreign currency risk were as follows:

	F	inancial assets: Monetary items USD JPY CNY inancial liabilities: Monetary items USD JPY CNY		December 31, 2023		Foreign currency 181,636 506 72,639 105,715 82,320 33,505	December 31, 2022
			Foreign currency $ 157,468 578 93,838 $ 69,066 290,042 46,006	Exchange rate USD/TWD 30.71 JPY/TWD 0.22 CNY/TWD 4.33 USD/TWD 30.71 JPY/TWD 0.22 CNY/TWD 4.33	TWD		Exchange rate TWD USD/TWD 30.71 5,578,052 JPY/TWD 0.23 118 CNY/NTD 4.41 320,191 USD/TWD 30.71 3,246,496 JPY/TWD 0.23 19,131 CNY/TWD 4.41 147,692
					4,835,049 125 406,038 2,120,686 62,997 199,068
	F

• 2) Sensitivity analysis

The Group’s exposure to foreign currency risk arises from the translation of the foreign currency exchange gains and losses on cash and cash equivalents, accounts receivable (including related parties) and other receivables, borrowings, and accounts payable (including related parties) and other payables (including related parties) that are denominated in foreign currency. A weakening (strengthening) of 1% of the NTD against the USD, JPY and CNY as of December 31, 2023 and 2022, the net loss before tax in 2023 would have decreased (increased) by $28,585 thousand; the net profit before tax in 2022 would have increased (decreased) by $24,850 thousand. The analysis assumes that all other variables remain constant.

(Continued)

55

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• 3) Foreign exchange gain and loss on monetary items

Since the Group has many kinds of transaction currency, the information on foreign exchange loss on monetary items is disclosed by total amount. For the years ended 2023 and 2022, foreign exchange gain (including realized and unrealized portions) amounted to $64,236 thousand and $222,147 thousand, respectively.

(iv) Interest rate risk

Please refer to the note on liquidity risk management and interest rate exposure of the Group’s financial assets and liabilities.

The following sensitivity analysis is based on the exposure to the interest rate risk of derivative and non derivative financial instruments on the reporting date. Regarding assets with variable interest rates, the analysis is based on the assumption that the amount of assets outstanding at the reporting date was outstanding throughout the year. The rate of change is expressed as the interest rate increases or decreases by 1% when reporting to management internally, which also represents the Group management’s assessment of the reasonably possible interest rate change.

If the interest rate had increased or decreased by 1%, the Group’s net loss before tax would have increased or decreased by $69,821 thousand for 2023, the Group’s net profit before tax would have decreased or increased by $75,905 thousand for 2022 with all other variable factors remaining constant. This was mainly due to the Group’s deposits and borrowings at variable rates.

(v) Other market price risk

For the years ended December 31, 2023 and 2022, the sensitivity analyses for the changes in the securities price at the reporting date were performed using the same basis for the profit and loss as illustrated below:

Prices of securities at the reporting date Increasing 1% Decreasing 1%	2023 Other comprehensive income after tax $ 4,358 $ (4,358)	2022 Other comprehensive income after tax 6,708 (6,708)

(Continued)

56

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(vi) Fair value of financial instruments

• 1) Fair value hierarchy

The fair value of financial assets and liabilities at fair value through profit or loss and financial assets at fair value through other comprehensive income is measured on a recurring basis. The carrying amount and fair value of the Group’s financial assets and liabilities, including the information on fair value hierarchy were as follows; however, except as described in the following paragraphs, for financial instruments not measured at fair value whose carrying amount is reasonably close to the fair value, and lease liabilities, disclosure of fair value information is not required:

Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income Financial assets measured at amortized cost Cash and cash equivalents Notes receivable, net Accounts receivable, net Other receivables Other receivables-related parties Other financial asset-current Refundable deposits Subtotal Financial liabilities measured at amortized cost Borrowings Accounts payable Other payables Lease liabilities Guarantee deposits received Subtotal		December 31, 2023	December 31, 2023	December 31, 2023
	Book Value $ 20,481 $ 435,752 866,459 11,815 4,023,205 68,533 637 3,404 60,682 $ 5,034,735 $ 7,846,886 2,141,794 1,019,775 243,740 27,785 $ 11,279,980		Fair value
		Level 1 20,481 339,660	Level 2 - -	Level 3 Total - 20,481 96,092 435,752

(Continued)

57

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income Financial assets measured at amortized cost Cash and cash equivalents Notes receivable, net Accounts receivable, net Other receivables Other receivables-related parties Other financial asset-current Refundable deposits Subtotal Financial liabilities measured at amortized cost Borrowings Accounts payable Other payables Lease liabilities Guarantee deposits received Subtotal		December 31, 2022	December 31, 2022	December 31, 2022
	Book Value $ 103,462 $ 670,766 $ 744,162 11,289 4,335,927 66,629 675 3,750 70,910 $ 5,233,342 $ 8,332,841 2,426,512 1,151,096 315,303 26,271 $ 12,252,023		Fair value
		Level 1 103,462 561,000	Level 2 - -	Level 3 Total - 103,462 109,766 670,766

2) Valuation techniques for financial instruments measured at fair value

If a financial instrument has a quoted price in an active market, the quoted price is used as fair value. The quoted price of a financial instrument obtained from major exchanges and over-the counter markets are the basis used to determine the fair value of a listed company’s stock and the quoted prices in an active market.

A financial instrument is regarded as being quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency and those prices represent actual and regularly occurring market transactions on an arm’s-length basis. If these conditions can not be reached, then the market is non-active. In general, a market with low trading volume or high bid-ask spreads is an indication of a non-active market.

(Continued)

58

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

The Group uses the following method in determining the fair value of its financial struments without a quoted price in an active market:

Financial assets at FVOCI non-current is investments in domestic non-listed stock. The market approach of comparable business based on multiple of the equity value of investees is used to estimate fair value. The estimation of the fair value of equity instruments has been adjusted due to the effect of the discount arising from the lack of marketability.

• 3) There were no transfers between Levels of the fair value hierarchy for the years ended December 31,2023 and 2022.

• 4) Schedule of Changes in Level 3

Balance at January 1 Recognized in other comprehensive income Balance at December 31	2023 Fair value through other comprehensive income $ 109,766 (13,674) $ 96,092	2022
		Fair value through other comprehensive income
		95,336 14,430
		109,766

• 5) Quantified information on significant unobservable inputs (Level 3) used in fair value measurement

The Group’s financial instruments that use Level 3 inputs to measure fair value included “fair value through other comprehensive income – equity investments”.

Quantified information of significant unobservable inputs was as follows:

Inter-relationship between significant unobservable inputs Valuation Significant and fair value Item technique unobservable inputs measurement Financial assets at Comparable ‧Price-Earnings value ‧Higher the rate, fair value through public and multiplier higher the fair other comprehensive company (2023.12.31:1.02 、 value income-equity method 2022.12.31:1.28) ‧Lack of market investments without ‧Lack of market liquidity liquidity, the higher an active market discount rate the discount, the (2023.12.31:11.05% 、 lower the fair value 2022.12.31: 8.81%)

(Continued)

59

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• 6) Fair value measurements in Level 3 – sensitivity analysis of reasonably possible alternative assumptions.

The Group’ s measurement on the fair value of financial instruments may change if different valuation models or inputs were used. For fair value measurements in Level 3, changing one or more of the assumptions would have the following effects on other comprehensive income:

December 31, 2023 Financial assets fair value through other comprehensive income December 31, 2022 Financial assets fair value through other comprehensive income	Input Value Multiplier Liquidity discount rate Value multiplier Liquidity discount rate	Change in A	Other Compehase income	Other Compehase income
			favour unfavour $ 4,722 4,722 $ 584 584 $ 5,147 5,147 $ 531 531
		5% 5% 5% 5%		4,722 584 5,147 531

(x) Financial risk management

• (i) Overview

The Group have exposures to the following risks from its financial instruments:

• 1) credit risk

• 2) liquidity risk

• 3) market risk

The following likewise discusses the Group’s objectives, policies and processes for measuring and managing the above mentioned risks. For more disclosures about the quantitative effects of these risks exposures, please refer to the respective notes in the accompanying consolidated financial statements.

• (ii) Structure of risk management

The Group’s risk management policies are established to identify and analyze the risks faced by the Group, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s activities. The Group, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.

(Continued)

60

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

The Group’ s Audit Committee oversees how management monitors compliance with the Group’ s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the Group. The Group’ s Audit Committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.

(iii) Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Group’s receivables from customers and investments in debt securities.

The main potential credit risk of the Group is derived from financial products, such as accounts receivable, but the main sales target are world-renowned manufacturers. In order to reduce the credit risk, the Group also regularly evaluates the customer’s operating conditions and the possibility of recovery for period receivables. Because the customer has a large customer base and has a good reputation of profit and credit history, there is no risk of concentration on the credit risk of the Group’s accounts receivable.

1) Investments

The finance department of the Group is responsible for measuring and monitoring the credit risk associated with bank deposits, fixed income investments, and other financial instruments. Given that the Group’ s counterparties consist of reputable banks, financial institutions with investment-grade or higher credit ratings, corporate organizations, and government agencies, there are no significant concerns regarding credit risk.

2) Guarantees

The Group’s policy is to provide financial guarantees only to wholly owned subsidiaries. As of December 31, 2023 and 2022, the Group had no other guarantees outstanding.

(iv) Liquidity risk

The Group manages sufficient cash and cash equivalents so as to cope with its operations and mitigate the effects of fluctuations in cash flows. The Group’ s management supervises the banking facilities and ensures compliance with the terms of loan agreements.

Loans and borrowings from the bank form an important source of liquidity for the Group. As of December 31, 2023 and 2022, the Group’s unused credit lines were amounted to $5,926,994 thousand and $4,457,922 thousand, respectively.

(v) Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates, and equity prices, will affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

• 1) Currency risk

(Continued)

61

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

The Group is exposed to currency risk on sales, purchases, and borrowings that are denominated in a currency other than the respective functional currencies of the Group’s entities, primarily the NTD, also including USD and CNY. The currencies used in these transactions are the NTD, USD and CNY.

Loan interest is priced in the currency of the principal of the loan. Generally speaking, the currency of the borrowing is the same as the currency of the cash flow generated by the operation of the Group, mainly in the NTD, also including CNY and USD. In this case, economic hedging is provided without the need to sign derivatives, so hedging accounting is not adopted.

Regarding other monetary assets and liabilities denominated in foreign currencies, when short-term imbalance occurs, the Group buys or sells foreign currencies at real-time exchange rates to ensure that the net risk of risk remains at an acceptable level.

2) Interest rate risk

The Group’ s borrowings primarily consist of floating rate debt, which means that changes in market interest rates will lead to fluctuations in the effective interest rate on the borrowings. As a result, there may be variability in future cash flows. The Group does not mitigate its exposure to interest rate fluctuations through the use of interest rate swap contracts.

3) Other market price risk

The Group is exposed to equity price risk due to the investments in equity securities. This is a strategic investment and is not held for trading. The Group does not actively trade in these investments as the management of the Group minimizes the risk by holding different investment portfolios.

(y) Capital management

The board’ s policy is to maintain a strong capital base so as to maintain investor, creditor, and market confidence, and to sustain future development of the business. Capital consists of ordinary shares, capital surplus, retained earnings, other equity, and non-controlling interests. The board is responsible for overseeing the return on capital, and simultaneously controls the level of dividends on ordinary shares.

(Continued)

62

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

As of December 31, 2023 the Group’s capital management strategy is consistent with the prior year as of December 31, 2022 . The Group’s debt-to-equity ratio at the end of the reporting period as of December 31, 2023 and 2022 are as follows:

Total liabilities Less: cash and cash equivalents Net debt Total equity Debt-to-equity ratio at December 31	December 31, 2023 $ 11,607,147 (866,459) $ 10,740,688 $ 9,824,002 % 109.33	December 31, 2022	December 31, 2022
	$ $ $		12,670,380 (744,162)
			11,926,218
			10,724,363
			% 111.21

(z) Investing and financing activities not affecting current cash flow

Long-term borrowings (including current portion) Short-term borrowings Lease liabilities Total liabilities from financing activities	2023.1.1 $ 6,705,226 1,627,615 315,303 $ 8,648,144	Cash flows (854,133) 405,586 (95,065) (543,612)	Non-cash	changes Lease payment change - - 23,502 23,502	December 31, 2023
			Exchange rate changes (17,397) (20,011) - (37,408)
					5,833,696 2,013,190 243,740
					8,090,626

Long-term borrowings (including current portion) Short-term borrowings Lease liabilities Total liabilities from financing activities	2022.1.1 $ 7,343,261 1,539,329 421,929 $ 9,304,519	Cash flows (982,610) 308,926 (133,299) (806,983)	Non-cash	changes lease payment change - - 26,673 26,673	December 31, 2022 6,705,226 1,627,615 315,303
			Exchange rate changes 344,575 (220,640) - 123,935
					8,648,144

(7) Related-party transactions

(a) Parent company and ultimate controlling company

The company is both the parent company and the ultimate controlling party of the Group.

(Continued)

63

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• (b) Names and relationship with related parties

The followings are entities that have had transactions with related party during the periods covered in the consolidated financial statements.

Name of related party	Relationship with the Group
CHANG, YUAN-MING	President of the company
Fulltech Fiber Glass Corp.	An associate
Ideal Bike Corporation	The entity’s president is the second immediate
	family of the president of the Company
Unitech Printed Circuit Humanities and	The entity’s president is the first immediate family
Education Foundation	of the president of the Company
Taiwan Federation of commerce	The entity’s chairman is the first immediate family
	of the president of the Company
Pan-Pacific & Southeast Asia Women’s	The entity’s chairman is the first immediate family
Association Ppseawa Taiwan R.O.C.	of the president of the Company
TESD Foundation	The entity’s president is the first immediate family
	of the president of the Company
Taiwan Coalition of Service Industries	The entity’s chairman is the president of the
	Company
The Business Development Foundation on the	The entity’s Vice-president is the president of the
Chinese Straits	Company

• (c) Significant transactions with related parties

• (i) Loans and guarantee to Related Parties

For the years ended December 31, 2023 and 2022, the president had provided a guarantee for loans to the Group.

• (ii) As of December 31, 2023 and 2022, other receivables raised due to collection and payment and various expense between the Group and related parties were $637 thousand and $675 thousand respectively which were recognized other receivables-related parties.

(Continued)

64

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

• (iii) Donations

Unitech Printed Circuit Humanities and Education Foundation Other related parties Total	2023 $ 4,000 1,000 $ 5,000	2022
		3,000 1,300
		4,300

The Group’s donations to related parties were recognized “selling expenses and administrative expenses”.

(d) Key management personnel compensation

Key management personnel compensation comprised:

Short-term employee benefits	2023 $ 63,190	2022
		80,433

(8) Pledged assets

The carrying values of pledged assets were as follows:

Pledged assets	Object	December 31, 2023 $ 407,228 1,713,674 129,231 2,038,146 - 35,950 150,500 $ 4,474,729	December 31, 2022 407,228 1,685,689 134,397 2,510,768 1,265 46,557 174,800 4,960,704
Land Building and constructions Right-of-used assets Machinery equipment Other facilities Certificate of deposit (Note 1) Stock (Note 2)	Short-term and long-term borrowings Short-term and long-term borrowings Long-term borrowings Long-term borrowings Long-term borrowings Bureau of Costoms’ endorsement, Letzer Industrial Park deposit and Loung Te Industrial Park deposit Short-term borrowings

“ ” (Note1) Classified into the account of Other financial assets-current .

“ ” (Note2) Classified into the account of Investments accounted for using equity method .

(Continued)

65

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(9) Significant commitments and contingencies:

• (a) As of December 31, 2023 and 2022, the machinery and equipment agreement entered by the Group had the material amounts of $390,128 thousand and $724,229 thousand, respectively; of which, the payments of $317,474 thousand and $595,861 thousand, respectively, were recognized “property, plant and equipment” and “repayments for business facilities”.

• (b) The Group’s outstanding standby letter of credit were as follows:

USD JPY EUR	December 31, 2023 $ 811 $ 332,850 $ -	December 31, 2022
		1,037
		23,120
		92

(10) Losses Due to Major Disasters:None

(11) Subsequent Events:

The Group purchased the land it leased, located in Dinliao section, Su’ao Township, Yilan County, from the Industrial Development Bureau, MOEA, at a price of $1,132,332 thousand, with the approval of its board on January, 16, 2024.

(12) Other:

• (a) A summary of current-period employee benefits, depreciation, and amortization, by function, is as follows:

By function By item	2023	2023	2023	2022	2022	2022
	Cost of Sale	Operating Expense	Total	Cost of Sale	Operating Expense	Total
Employee benefits
Salary	2,891,788	659,992	3,551,780	3,302,681	695,217	3,997,898
Labor and health insurance	310,996	53,984	364,980	312,559	52,116	364,675
Pension	168,570	47,232	215,802	176,100	45,162	221,262
Remuneration of directors	-	5,490	5,490	-	5,490	5,490
Others	128,791	65,734	194,525	128,595	71,301	199,896
Depletion	1,470,103	78,562	1,548,665	1,414,908	111,698	1,526,606
Amortization	32,798	37,414	70,212	28,241	31,157	59,398

(Continued)

66

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(13) Other disclosures:

• (a) Information on significant transactions:

The following is the information on significant transactions required by the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” for the Group:

(i) Loans to other parties:

Number	Name of lender	Name of borrower	Account name	Related party	Highest balance of financing to other parties during the period	Ending balance	Actual usage amount during the period	Range of interest rates during the period	Purposes of fund financing for the borrower	Transaction amount for business between two parties	Reasons for short-term financing	Allowance for bad debt	Collateral	Collateral	Individual funding loan limits	Maximum limit of fund financing	Note
													Item	Value
1	Unitec Electronics Co., Ltd.	Unitech BVI	Other receivable s-related parties	Yes	291,825	-	-	2%~2.5%	2	-	Reduce the Group financial costs	-	-	-	982,400	1,964,800	Note 1
2.	Shanghai Unitech Electronics Co., Ltd.	Shanghai Unitech Electronics (Nantong) Co., Ltd.	Other receivable s-related parties	Yes	360,045	90,867	90,867	4%	2	-	General operating and return the loan	-	-	-	3,431,028	3,431,028	Note 1

Note 1: This transaction has been eliminated when the consolidated financial report is prepared.

• Note 2: The total amount available for loan of the Company shall not exceed 20% of its net worth; and the individual amount available for financing purposes shall not exceed 10% of the Company’s net worth.

For a subsidiary who, directly or indirectly, holds the entire shares of a foreign subsidiary, the maximum amount available for loan should not exceed the net worth of subsidiary which is lender.

Note 3: The filling method of capital loan and nature is as follows:

• (1) Fill in 1 for those who have business dealings.

(2) Fill in 2 if there is a need for short-term financing.

(ii) Guarantees and endorsements for other parties:

No. (Note 1)	Name of guarantor	Counter-party of guarantee and endorsement	Counter-party of guarantee and endorsement	Limitation on amount of guarantees and endorsements for a specific enterprise (Note 3 and 5)	Highest balance for guarantees and endorsements during the period	Balance of guarantees and endorsements as of reporting date	Actual usage amount during the period	Property pledged for guarantees and endorsements (Amount)	Ratio of accumulated amounts of guarantees and endorsements to net worth of the latest financial statements	Maximum amount for guarantees and endorsements (Note 4 and 6)	Parent company endorsements/ guarantees to third parties on behalf of subsidiary	Subsidiary endorsements/ guarantees to third parties on behalf of parent company	Endorsements/ guarantees to third parties on behalf of companies in Mainland China
		Name	Relationship with the Company (Note 2)
0	The Company	Unitech BVI	2	4,912,001	677,100	288,000	-	-	% 2.93	7,859,202	Y	N	N
0	The Company	Shanghai Unitech Electronics Co., Ltd.	2	4,912,001	389,100	-	-	-	% -	7,859,202	Y	N	Y
0	The Company	Shanghai Unitech Electronics (Nantong) Co., Ltd.	2	4,912,001	1,638,767	1,638,767	941,123	-	% 16.68	7,859,202	Y	N	Y
1	Shanghai Unitech Electronics Co., Ltd.	Shanghai Unitech Electronics (Nantong) Co., Ltd.	2	3,431,028	1,735,318	1,291,980	1,162,170	-	% 37.66	6,862,057	Y	N	Y

Note1: The numbers filled in for the loans provided by the Company or subsidiaries are as follows:

• (a)The Company is ‘0’.

• (b)The subsidiaries are numbered in order starting from ‘1’.

Note2: 7 forms of relationships in which corporate guarantees exist are defined as follows:

• (a) Entities have business relations with Company.

• (b) The Company directly or indirectly holds more than 50% of voting shares of its subsidiaries.

• (c) Investees directly or indirectly own more than 50% of voting shares of the Company

• (d) The Company directly or indirectly holds 90% of voting shares of its subsidiaries.

• (e) Entities have construction contract agreements with the Company.

• (f) The reason for the Company jointly invested in the entities is to provide proportionate endorsements.

• (g) The Company has contractual pre-sale house agreements with its related parties under the Consumer Protection Law.

(Continued)

67

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Note3: The Company’s aggregate amount allows endorsement or guarantee that does not exceed 50% of its net worth in December 31, 2023. Note4: The Company’s aggregate amount allows endorsement or guarantee that does not exceed 80% of its net worth in December 31, 2023. Note5: The Subsidiaries aggregate amount to one company allows endorsement or guarantee that does not exceed 100% or its net worth in December 31, 2023. Note6: The Subsidiaries aggregate total amount allows endorsement or guarantee that does not exceed 200% of its net worth in December 31, 2023.

(iii) Securities held as of December 31, 2023 (excluding investment in subsidiaries, associates and joint ventures):

(Amounts in Thousands of New Taiwan Dollars/Shares)

Name of holder	Category and name of security	Relationship with company	Account title	Ending balance	Ending balance	Ending balance	Ending balance	Highest Percentage of ownership (%)	Note
				Shares/Units (thousands)	Carrying value	Percentage of ownership (%)	Fair value
The Company	Ideal Bike Corporation	Related party	Financial assets at fair value through other comprehensive income non-current	34,000	339,660	% 11.27	339,660	% 11.27	-
DA-TAI Investment Co., Ltd.	ANCAD, INC	-	"	26	-	% 2.02	-	% 2.02	-
DA-TAI Investment Co., Ltd.	Taiwan First Biotechnology Corporation	-	"	5,306	96,092	% 4.00	96,092	% 4.00	-
DA-TAI Investment Co.,Ltd.	Jih Sun Money Market Fund	-	Current financial assets at fair value through profit or loss	1,343	20,481	-	20,481	-	-

• (iv) Individual securities acquired or disposed of with accumulated amount exceeding the lower of NT$300 million or 20% of the capital stock: None.

• (v) Acquisition of individual real estate with amount exceeding the lower of NT$300 million or 20% of the capital stock:

Name of company	Name of property	Transaction date	Transaction amount	Status of payment	Counter- party	Relationship with the Company	If the counter-party is a related party, disclose the previous transfer information	If the counter-party is a related party, disclose the previous transfer information	If the counter-party is a related party, disclose the previous transfer information	If the counter-party is a related party, disclose the previous transfer information	References for determining price	Purpose of acquisition and current condition	Others
							Owner	Relationshi p with the Company	Date of transfer	Amount
The Company	Land	2023.01.13	836,572 (Note 1)	Paid in full	Industrial Developme nt Bureau, Ministry of Economic Affairs	None	Not applicable	Not applicable	Not applicable	Not applicable	Note 2	Overall planning of operation	None

Note 1: The actual payment amount after deducting $292,616 thousand of paid rent from the total transaction amount was $543,956 thousand. Note 2: The price was based on a letter from the Industrial Development Bureau, Ministry of Economic Affairs.

• (vi) Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20% of the capital stock:

Name of company	Type of property	Transaction date	Acquisition date	Book value	Transaction amount	Amount actually receivable	Gain from disposal	Counter- party	Nature of relationship	Purpose of disposal	Price reference	Other terms
The Company	Land and Plant	2023.03.03	2023.02.23	471,849	672,478	Received in full	200,629	Voyager Photovoltaic Co., Ltd	None	Overall planning of operational	Grand Elite Real Estate Appraisers Firm	None

(Continued)

68

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(vii) Related-party transactions for purchases and sales with amounts exceeding the lower of NT$300 million or 20% of the capital stock:

Name of company	Related party	Nature of relationship	Transaction details	Transaction details	Transaction details	Transaction details	Transactions with terms different from others	Transactions with terms different from others	Notes/Accounts receivable (payable)	Notes/Accounts receivable (payable)	Note
			Purchase/ Sale	Amount	Percentage of total purchases/sales	Payment terms	Unit price	Payment terms	Ending balance	Percentage of total notes/accounts receivable (payable)
The Company	Shanghai Unitech Electronics (Nantong) Co., Ltd.	Subsidiary	Purchase	3,605,502	% 44.63	The payment terms are based on the loose funds.	-	The payment terms are based on the loose funds.	(1,234,071)	(44.96)%	Note 1
Shanghai Unitech Electronics (Nantong) Co., Ltd.	The Company	The Parent Company	Sale	(3,605,502)	% (77.44)	The collection are based on the loose funds.	-	The collection are based on the loose funds.	1,234,071	79.79%	Note 1

Note 1: The transaction was eliminated in the preparation of the consolidated financial statements.

• (viii) Receivables from related parties with amounts exceeding the lower of NT$100 million or 20% of the capital stock:

Counter-party	Nature of relationship	Ending balance	Turnover rate	Overdue	Overdue	Amounts received in subsequent period	Allowance for bad debts	Note
				Amount	Action taken
The Company	The parent company	Account Receivable- related party 1,234,071	2.83	-	-	428,345 (USD 11,749 thousand) (CNY 12,420 thousand)	-	Note 1

Note 1: The inter company transactions have been eliminated in the consolidated statements.

(ix) Trading in derivative instruments: None.

• (x) Business relationships and significant intercompany transactions:

No. (Note 1)	Name of company	Name of counter-party	Nature of relationship (Note 2)	Intercompany transactions	Intercompany transactions	Intercompany transactions	Intercompany transactions
				Account name	Amount	Trading terms (Note 4)	Percentage of the consolidated net revenue or total assets
0	The Company	Unitech BVI	1	Interest Income	4,889	-	0.03%
0	The Company	Shanghai Unitech Electronics (Nantong) Co., Ltd.	1	Sales	29,485	-	0.20%
0	The Company	Shanghai Unitech Electronics (Nantong) Co., Ltd.	1	Accounts Receivable	21,604	-	0.10%
1	Shanghai Unitech Electronics Co., Ltd.	Shanghai Unitech Electronics (Nantong) Co., Ltd.	3	Other Receivables	97,277	-	0.45%
1	Shanghai Unitech Electronics Co., Ltd.	Shanghai Unitech Electronics (Nantong) Co., Ltd.	3	Other Income	66,953	-	0.45%
1	Shanghai Unitech Electronics Co., Ltd.	Shanghai Unitech Electronics (Nantong) Co., Ltd.	3	Interest Income	9,027	-	0.06%
2	Shanghai Unitech Electronics (Nantong) Co., Ltd.	The Company	2	Sales	3,605,502	-	24.10%
2	Shanghai Unitech Electronics (Nantong) Co., Ltd.	The Company	2	Accounts Receivable	1,234,071	-	5.76%
3	Unitech BVI	Unitech HK	3	Other Receivables	2,468	-	0.01%

Note 1: Company numbering as follow: (1). Parent company 0

(Continued)

69

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(2). Subsidiaries starting from 1.

Note 2: Relationship:

(1). Transaction between the Parent Company and the subsidiary.

(2). Transaction between the subsidiary and the Parent Company.

(3). Transaction between the subsidiary and the subsidiary.

Note 3: Only disclose sales, revenues and receivables.

Note 4: The prices and terms of payment for intercompany sales are not materially different from those for ordinary sales. For the rest of the transactions, since there are no similar transactions, the terms of the transactions are determined by mutual agreement.

Note 5: The above transactions were eliminated in the preparation of the consolidated financial statements.

(b) Information on investees:

The following is the information on investees for the year 2023 (excluding information on investees in Mainland China):

				(Unit: thousand shares)	(Unit: thousand shares)	(Unit: thousand shares)	(Unit: thousand shares)	(Unit: thousand shares)	(Unit: thousand shares)	(Unit: thousand shares)	(Unit: thousand shares)	(Unit: thousand shares)
Name of investor	Name of investee	Location	Main businesses and products	Original investment amount		Balance as of December 31, 2023			Highest Percentage of ownership	Net income (losses) of investee	Share of profits/losses of investee	Note
				December 31, 2023	December 31, 2022	Shares (thousands)	Percentage of ownership	Carrying value
The Company	Unitech BVI	British Virgin Islands	Reinvestment	2,793,183	2,509,779	4.34	% 100.00	4,094,423	% 100.00	285,090	290,402	Note 1
The Company	DA-TAI Investment Co., Ltd.	Taiwan	General investment	820,019	820,019	82,000	% 100.00	1,032,757	% 100.00	(87,461)	(87,461)	Note 1
The Company	Unitech Thailand	Thailand	Manufacturing and sale of PCB	67,269	-	753	% 100.00	67,302	% 100.00	67	67	Note 1
The Company	Unitech HK	Hong Kong	Reinvestment	153,980	153,980	5,000	% 6.10	228,740	% 6.10	309,473	18,869	Note 1
DA-TAI Investment Co., Ltd.	Fulltech Fiber Glass Corp.	Taiwan	Manufacturing of glass and glass products	600,684	600,684	60,655	% 13.21	912,683	% 13.47	(651,195)	(87,664)	-
Unitech BVI	Unitech HK	Hong Kong	Reinvestment	2,480,927	2,480,927	77,000	% 93.90	4,099,369	% 93.90	309,473	290,604	Note 1

Note 1: The intercompany transactions have been eliminated from consolidation.

• (c) Information on investment in mainland China:

• (i) The names of investees in Mainland China, the main businesses and products, and other information:

(In Thousands of New Taiwan Dollars)

Name of investee	Main businesses and products	Total amount ofpaid-in capital	Method of investment (Note 1)	Accumulated outflow of investment from Taiwan as of January 1, 2023	Investment flows	Investment flows	Accumulated outflow of investment from Taiwan as of December 31, 2023	Net income (losses) of the investee	Percentage of ownership	Highest percentage of ownership	Investment income (losses) (Note2 and 3)	Book value (Note3)	Accumu-lated remittance of earnings in currentperiod
					Outflow	Inflow
Shanghai Unitech Electronics Co., Ltd.	Manufacturing and sale of PCB	2,474,777	( 2 )	2,480,927	-	-	2,480,927	241,061	100.00%	100.00%	241,061	3,431,028	-
Shanghai Unitech Electronics (Nantong) Co., Ltd.	Manufacturing and sale of PCB	4,486,960	( 3 )	937,800 (Note4)	-	-	937,800	321,385	100.00%	100.00%	321,385	4,217,450	-

(ii) Limitation on investment in Mainland China:

Company Name	Accumulated Investment in Mainland China as of December 31, 2023 (Note 5)	Investment Amounts Authorized by Investment Commission, MOEA (Note 5)	Upper Limit on Investment (Note 6)
The Company	3,834,932 (USD 124,896 thousand)	3,834,932 (USD 124,896 thousand)	5,894,401

Note 1: Three ways to investment in mainland China

• (1) Direct investment

• (2) Indirect investment through holding companies

• (3) Others

Note 2: The recognition of gain and loss on investment based on the audit financial report which was assured by R.O.C. Accountant.

Note 3: The intercompany transactions have been eliminated from consolidation.

Note 4: The amount includes the capitalization of retained earnings amounting to USD27,000 thousand.

Note 5: As of December 31, 2023, exchange rate USD/NTD 1:30.705

Note 6: Calculated based on 60% of the Company’s net worth.

(Continued)

70

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

(iii) Significant transactions:

The significant inter-company transactions with the subsidiary in Mainland China, which were eliminated in the preparation of consolidated financial statements, are disclosed in “ Information on significant transactions”.

• (d) Major shareholders:

(Unit: share)	(Unit: share)	(Unit: share)
Shareholding Shareholder’s Name	Shares	Percentage
GUO-LING INVESTMENT CO.LTD	42,836,450	% 6.39

(14) Segment information:

• (a) Information about reportable segments and their measurement and reconciliations

The Group engaged in the production and sales of PCB, thus there is no disclosure of industrial financial information.

The Group’s operating segment information and reconciliation were as follows:

Revenue: Revenue from external customers Intersegment revenues Total revenue Reportable segment profit or loss Reportable segment assets		2023	2023	Total 14,960,822 - 14,960,822 (344,564) 21,431,149
	Domestic PCB and other $ 13,901,494 29,485 $ 13,930,979 $ (631,333) $ 20,100,404	Oversea PCB 1,059,328 3,596,451 4,655,779 286,769 8,020,011	Reconciliation and elimination - (3,625,936) (3,625,936) - (6,689,266)

(Continued)

71

Unitech Printed Circuit Board Corporation and Subsidiaries Notes to the Consolidated Financial Statements

Revenue: Revenue from external customers Intersegment revenues Total revenue Reportable segment profit or loss Reportable segment assets		2022	2022
	Domestic PCB and other $ 16,218,213 70,729 $ 16,288,942 $ 492,464 $ 21,398,250	Oversea PCB 1,205,288 3,475,369 4,680,657 (57,373) 8,509,655	Reconciliation and elimination - (3,546,098) (3,546,098) - (6,513,162)	Total
				17,423,501 -
				17,423,501
				435,091
				23,394,743

• (b) Geographic information

In presenting information on the basis of geography, segment revenue was based on the geographical location of customers and segment assets are based on the geographical location of the assets.

Geographical information Revenue from external customers: Taiwan China United States Other countries Non-current Assets: Taiwan China Total	2023 $ 818,002 4,394,507 3,623,322 6,124,991 $ 14,960,822 $ 7,034,796 5,304,067 $ 12,338,863	2022
		638,996 5,563,928 3,616,464 7,604,113
		17,423,501
		7,594,836 5,692,725
		13,287,561

Non-current assets include property, plant and equipment, intangible assets and other assets, not including financial instruments and deferred tax assets.

• (c) Major customers

A customer of PCB division	2023 $ 1,792,453	2022
		1,691,066