WANHWA — Annual Report 2021

Nov 10, 2021

Stock code: 2701

Wan Hwa Enterprise Company Ltd.

Financial Statements for the Years Ended December 31, 2021 and 2020 and Independent Auditors’ Report

Notice to Readers

Where any discrepancy arises between the English translation and the

original Chinese version of this final statements and independent auditors’

report, the Chinese version shall prevail.

• 1 -

§INDEX§

				Notes and
				numbers to the
				financial
		Item	Page	statements
I.	Cover		1	-
II.	Index		2	-
III.	Accountant’s opinion		3～6	-
IV.	Balance sheet		7	-
V.	statement of comprehensive income		8～9	-
VI.	Statement of changes in equity		10	-
VII. Statement of cash flows			11～12	-
VIII. Notes		to the financial statements
	(I)	Company history	13	I
	(II)	Date and procedures for approval of	13	II
		financial statements
	(III)	Application of newly issued and	13～15	III
		revised standards, and their
		interpretations
	(IV)	Summary of significant accounting	15～24	IV
		policies
	(V)	Significant accounting judgments,	24	V
		estimations, and assumptions, and
		other major sources of estimation
		uncertainty
	(VI)	Description of significant accounting	24～38	6-17
		items
	(VII)	Related party transaction	42	20
	(VIII)	Assets pledged	-	-
	(IX)	Significant contingent liabilities and	-	-
		unrecognized contractual commitments
	(X)	Major catastrophic loss	-	-
	(XI)	Significant post-term events	-	-
	(XII)	Others	38～43	18-19, 21-22
	(XIII)	Other disclosures
		1. Information on material transactions	44、47～48	23
		2. Information about re-investment	44、47～48	23
		business
		3. Information on Mainland China	44	23
		investment
		4. Name of major Shareholders	44、49	23
	(XIV)	Information on the departments	44～46	24
9. Detail table of significant accounting items			50～58	-

• 2 -

INDEPENDENT AUDITORS’ REPORT

Wan Hwa Enterprise Company Ltd.

Opinion

We have audited the accompanying financial statements of Wan Hwa Enterprise Company Ltd. (the “Company”), which comprise the balance sheets as of December 31, 2021 and 2020, the statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the report of other auditors (refer to the other matter paragraph), the accompanying financial statements present fairly, in all material respects, the financial position of December 31, 2021 and 2020, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended December 31, 2021. These matters were addressed in the context of our audit

• 3 -

of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matter of the Company’s financial statements for the year ended December 31, 2021 is stated as follows:

Rental Revenue Recognition

The main business of the Company includes the rental of commercial buildings. As individual lease terms vary, the inclusion of payment adjustments and other agreed terms relating to the rights and obligations of the leasing parties, if the terms contained in the contract are not properly identified may result in the risk of incorrectly recognizing income. Please refer to Note 4 for related accounting policies.

In response to the above risks, we understand and evaluate the effectiveness of the Company's internal controls and obtained all lease contracts, reviewed the terms of the contracts and verified whether the accounting treatment of rental revenue was consistent with the accounting policy on revenue recognition, summarizes the rental revenue to be recognized based on the terms of the contracts, and reconciled with the accounting rental revenue to confirm that there are significant differences.

Other Matters

Among the affiliated companies accounted for under the equity method in the financial statements of Wan Hwa Enterprise Company Ltd. the 2021 and 2020 financial statements of Forward Time Corporation, Today's V, Inc. and Today's VI, LLC, accounted for under the equity-method by Today's Hotel Corporation, and the financial reports of Wan Hwa International Investment Company Ltd. for the years ended 2021 and 2020, were performed by other auditors. Hence, the opinion on the financial statements referred to above, which relates to the balance of investments accounted for using the equity method and the share of income or loss of affiliated companies recognized using the equity method, was based on other auditors' report. As of December 31, 2021 and 2020, the above balance audited by other accountants under the equity method amounted to NT$940,876 thousand and NT$ 978,999 thousand, respectively, each represents 11% of total assets, and the shares of these investments accounted for affiliated companies from January 1 to December 31, 2021 and 2020 were NT$ (10,775) thousand and NT$ 49,234 thousand, respectively, representing (11)% and 23% of the profit before income tax.

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

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and IFRS, IAS, IFRIC, and 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 financial statements that are free from material misstatement, whether due to fraud or error.

• 4 -

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

Those charged with governance (including members of the Audit Committee) are

responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

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

As part of an audit in accordance with the auditing standards generally accepted in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

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

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

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

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

5. 5 -

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

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

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements for the year ended December 31, 2021 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.

Deloitte & Touche CPA: Tung-Ju Hsieh CPA: Yung-Hsiang Chao. Financial Supervisory Commission Approval Financial Supervisory Commission Approval Jin-Kuan-Zheng-Shen-Zi No. 1090347472 Jin-Kuan-Zheng-Shen-Zi No. 1050024633

Notice to Readers

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

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

• 6 -

Wan Hwa Enterprise Company Ltd.

Balance sheet

December 31, 2020 and 2019

Unit: NTD thousand

			December31,	2021				December31,	2020
Asset			Amount		%			Amount		%
Current assets
Cash and cash equivalents (Notes 4 and 6)		$	161,359		2		$	167,685		2
Financial assets at fair value through profit or loss - current
(Notes 4 and 7)			111,531		1			111,308		1
Financial assets at amortised cost - current (Notes 4 and 8)			1,291,471		15			1,241,517		14
Accounts Receivable(Note 4)			36		-			-		-
Other receivables (Notes 4)			4,981		-			5,376		-
Other current assets			1,663		-			1,679		-
Total current assets			1,571,041		18			1,527,565		17
Non-current assets
Financial assets at fair value through other comprehensive
income or loss - non-current (Notes 4 and 9)			2,705,665		31			2,601,934		30
Investments accounted for using equity method (notes 4 and
10)			2,695,285		31			2,857,136		33
Property, plant and equipment (Notes 4 and 11)			348,568		4			350,906		4
Real estate investments (Notes 4 and 12)			1,336,836		15			1,341,352		15
Deferred tax assets (Notes 4 and 16)			55,791		-			39,904		-
Refundable deposits			28		-			28		-
Long-term receivables (Notes 4 and 12)			56,048		1			61,299		1
Total non-current assets			7,198,221		82			7,252,559		83
Total assets		$	8,769,262		100		$	8,780,124		100
Liabilities and Equity
Current liabilities
Accounts payable		$	2,004		-		$	3,229		-
Other payables			122,851		2			120,231		2
Current tax liabilities (Note 4)			13,695		-			20,619		-
Other current liabilities			183		-			163		-
Total current liabilities			138,733		2			144,242		2
Non-current liabilities
Deferred tax liabilities (Notes 4 and 16)			979,100		11			996,052		11
Net defined benefit liabilities (Notes 4 and 13)			608		-			274		-
Guarantee deposits received (Note 12)			107,266		1			107,266		1
Total non-current liabilities			1,086,974		12			1,103,592		12
Total liabilities			1,225,707		14			1,247,834		14
Shareholders’ Equity
Capital
Common stock			4,499,678		51			4,499,678		51
Retained earnings
Legal reserves			612,222		7			594,787		7
Special reserves			686,543		8			686,543		8
unappropriated retained earnings			1,168,428		13			1,214,290		14
Total retained earnings			2,467,193		28			2,495,620		29
Other equities
Exchange differences on translating the financial
statements of foreign operations	(		222,009 )	(	2 )	(		158,579 )	(	2 )
Unrealized gain or loss on financial assets at fair value
through other comprehensive income			798,693		9			695,571		8
Total other equities			576,684		7			536,992		6
Total equities			7,543,555		86			7,532,290		86
Total liability and equity		$	8,769,262		100		$	8,780,124		100

The accompanying notes are an integral part of the financial statements. (Please refer to the Deloitte Taiwan audit report dated on March 25, 2022)

• 7 -

S t a t e m e n t of c o m p r e h e n s i v e i n c o m e

W a n H w a E n t e r p ris e C o m p a n y Lt d.

From January 1[st] to December 31[st] , 2021 and 2020

U n it s : N T D t h o u s a n d, e x c e p t e a r ni n g s p e r s h a r e

Operating Revenue (Notes 4 and 12) Rental revenue Entertainment revenue Total operating revenue Operating cost (Note 15) Rental cost Entertainment cost Total operating cost Gross Profit Operating expenses (Notes 11, 12, 13, 15, and 20) Operating profit Non-operating income and expenses Share of gain (loss) of affiliated enterprise accounted for using the equity method (Notes 4 and 10) Interest income (Note 4) Dividends income (Notes 4 and 9) Other income (Notes 4 and 22) Gain on financial assets at fair value through profit or loss Other gains and losses Total non-operating income and expenses Profit before income tax Income tax expense (Notes 4 and 16) Net profit		2021		% 69 31 100 14 24 38 62 12 50 34 ) 5 18 - 1 - ( 9) 41 6 35		2020
		Amount $ 165,408 74,528 239,936 32,955 59,046 92,001 147,935 29,310 118,625 82,564 ) 10,129 42,463 9,506 223 1,008) 21,251) $ 97,374 13,018 84,356				Amount $ 186,054 78,637 264,691 35,615 60,734 96,349 168,342 30,402 137,940 25,383 ) 12,212 75,847 9,338 452 798) 71,668 $ 209,608 35,488 174,120		%
	( ( (		(		( (		(	70 30 100 13 23 36 64 12 52 9 ) 5 29 - 1 - 27 79 13 66

(continued from next page)

• 8 -

(continued from previous page)

Other comprehensive income (Notes 4, 13, 14 and 16) Items that are not reclassified to profit or loss: Re-measurement of defined benefit plans Unrealized gain (loss) on investments in equity instruments at fair value through other comprehensive income Income tax related to compoment of ther comprehensive income that are not reclassified to profit or loss Items that may be reclassified to profit or loss later: Exchange differences on translation of financial statements of foreign operations of affiliated enterprises recognized under the equity method Income tax related to items that may be reclassified to profit or loss Other comprehensive income (loss) for the year (net after tax) Total comprehensive income (loss) for the year Earnings per share (Note 17) Basis		2021		% - 43 - 43 33 ) 7 26) 17 52		2020
		Amount 291 ) 103,731 609) 102,831) 79,287 ) 15,857 63,430) 39,401 $ 123,757 $ 0.19				Amount 234 144,285 ) 725 143,326) 150,851 ) 30,170 120,681) 264,007) $ 89,887) $ 0.39		%
	( ( ( ( (		( (		( ( ( ( ( (		( ( ( ( ( (	- 54 ) - 54) 57 ) 11 46) 100) 34)

The accompanying notes are an integral part of the financial statements. (Please refer to the Deloitte Taiwan audit report dated on March 25, 2022)

• 9 -

Wan Hwa Enterprise Company Ltd.

Statement of changes in equity

From January 1[st] to December 31[st] , 2021 and 2020

Unit: NTD thousand

Balance as of January 1, 2020 Appropriation and distribution of 2019 earnings: Legal reserve Cash dividends - NTD 0.4 per share Net profit in 2020 2020 Other comprehensive income (loss) after tax Total comprehensive income(loss) in 2020 Balance at December 31, 2020 Appropriation and distribution of 2020 earnings: Legal reserve Cash dividends - NTD 0.4 per share Net profit in 2021 2021Other comprehensive income (loss) after tax Total comprehensive income(loss) in 2021 Balance at December 31, 2021		Capital (Note 14) $ 4,499,678 - - - - - 4,499,678 - - - - - $ 4,499,678	Retained earnings(Note 14) Legal reserves Special reserves Unappropriated earnings $ 554,831 $ 686,543 1,259,879 39,956 - ( 39,956 ) - - ( 179,987 ) - - 174,120 - - 234 - - 174,354 594,787 686,543 1,214,290 17,435 - ( 17,435) - - ( 112,492) - - 84,356 - - ( 291 ) - - 84,065 $ 612,222 $ 686,543 $ 1,168,428	Retained earnings(Note 14) Legal reserves Special reserves Unappropriated earnings $ 554,831 $ 686,543 1,259,879 39,956 - ( 39,956 ) - - ( 179,987 ) - - 174,120 - - 234 - - 174,354 594,787 686,543 1,214,290 17,435 - ( 17,435) - - ( 112,492) - - 84,356 - - ( 291 ) - - 84,065 $ 612,222 $ 686,543 $ 1,168,428	Retained earnings(Note 14) Legal reserves Special reserves Unappropriated earnings $ 554,831 $ 686,543 1,259,879 39,956 - ( 39,956 ) - - ( 179,987 ) - - 174,120 - - 234 - - 174,354 594,787 686,543 1,214,290 17,435 - ( 17,435) - - ( 112,492) - - 84,356 - - ( 291 ) - - 84,065 $ 612,222 $ 686,543 $ 1,168,428	Other shareholders’ equities(Notes 4 and 14) Exchange differences on translating the financial statements of foreign operations Unrealized gain or loss on financial assets at fair value through other comprehensive income $ 37,898 $ 839,131 - - - - - - ( 120,681) ( 143,560) ( 120,681) ( 143,560) ( 158,579 ) 695,571 - - - - - - ( 63,430 ) 103,122 ( 63,430 ) 103,122 ($ 222,009) $ 798,693	Other shareholders’ equities(Notes 4 and 14) Exchange differences on translating the financial statements of foreign operations Unrealized gain or loss on financial assets at fair value through other comprehensive income $ 37,898 $ 839,131 - - - - - - ( 120,681) ( 143,560) ( 120,681) ( 143,560) ( 158,579 ) 695,571 - - - - - - ( 63,430 ) 103,122 ( 63,430 ) 103,122 ($ 222,009) $ 798,693		Total equities
						Exchange differences on translating the financial statements of foreign operations $ 37,898 - - - ( 120,681) ( 120,681) ( 158,579 ) - - - ( 63,430 ) ( 63,430 ) ($ 222,009)
			Legal reserves $ 554,831 39,956 - - - - 594,787 17,435 - - - - $ 612,222	Special reserves $ 686,543 - - - - - 686,543 - - - - - $ 686,543
					( ( ( ( (	( ( ( ( ( (		( (	$ 7,802,164 - 179,987 ) 174,120 ( 264,007) ( 89,887) 7,532,290 - 112,492 ) 84,356 39,401 123,757 $ 7,543,555

The accompanying notes are an integral part of the financial statements. (Please refer to the Deloitte Taiwan audit report dated on March 25, 2022)

• 10 -

Wan Hwa Enterprise Company Ltd. Statement of cash flows

From January 1[st] to December 31[st] , 2021 and 2020

Unit: NTD thousand

Cash flow from operating activities Profit before income tax Adjustments for: Depreciation expense Net gain on financial assets at fair value through profit or loss Interest income Dividends income Share of profit (loss) of associates and joint ventures accounted for using the equity method Unrealized foreign currency exchange gains and losses Changes in operating assets and liabilities Accounts receivable Other receivables Other current assets Accounts payable Other payables Other current liabilities Net defined benefit liabilities Cash generated from operation Income tax paid Net cash flows from operating activities Cash flow from invesing Acquisition of financial assets at amortized cost Acquisition of property, plants and equipment Decrease on refundable deposits Interests received Dividends income received Net cash inflow through investment	2021 $ 97,374 6,867 ( 223 ) ( 10,129 ) ( 42,463 ) 82,564 147 ( 36) 5,053 16 ( 1,225 ) ( 1,199 ) 20 43 136,809 ( 37,533) 99,276 ( 50,101 ) ( 13 ) - 10,722 42,463 3,071	Fiscal year of 2020
		$ 209,608 8,520 ( 452 ) ( 12,212 ) ( 75,847 ) 25,383 ( 341 ) - 3,109 12 640 ( 684 ) ( 62 ) 68 157,742 ( 45,908) 111,834 ( 50,117 ) ( 648 ) 3 12,776 75,847 37,861

(continued from next page)

• 11 -

(continued from previous page)

Code Cash flow through fundraising Increase on deposits received Cash dividends distributed Net cash outflow through fundraising EEEE Net decrease in cash and cash equivalents E00100 Cash and cash equivalents at the beginning of the year E00200 Cash and cash equivalents at the end of the year

The accompanying notes are an integral part of the financial statements. (Please refer to the Deloitte Taiwan audit report dated on March 25, 2022)

• 12 -

Wan Hwa Enterprise Company Ltd.

Notes to the financial statements

January 1 through December 31 of 2020 and 2019

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

I. Company history

The Company's shares have been listed and traded on the Taiwan Stock Exchange since March 22, 1965. The Company is mainly engaged in the rental of commercial buildings and the operation of cinemas and amusement arcades.

• II. Date and procedures for approval of financial statements

This financial statements were approved by the Board of Directors on March 24, 2022.

• III. Application of Newly Issued and Revised Standards, and their Interpretations

• (I) First-time application of International Financial Reporting Standards ("IFRSs"), International Accounting Standards ("IASs"), Interpretations ("IFRICs") and Announcement on Interpretations ("SICs") (herein after "IFRSs") endorsed by the Financial Supervisory Commission ("FSC") and issued into effect in 2021.

  • The revised IFRSs approved and issued by the FSC effective in 2021 did not result in significant changes in the Company's accounting policies.

• (II) The Company has not yet applied the IFRSs recognized by the FSC, which will be applicable in 2022.

International Accounting Newly issued/revised/amended standards and Standards Board (IASB) interpretation Effective date of issuance Annual Improvements Plan 2018-2020 January 1, 2022 (Note 1) Amendment on IFRS 3 "Update the indexing of the January 1, 2022 (Note 2) conceptual framework" Amendment on IAS 16 "Property, plant and equipment: January 1, 2022 (Note 3) price before reaching intended use" Amendment on IAS 37 "Loss-making Contracts - Cost of January 1, 2022 (Note 4) executing contracts"

• Note 1: The Amendments on IFRS 9 apply to exchanges or modifications of the terms of financial liabilities that occur in annual reporting periods beginning after January 1, 2022; the Amendments on IAS 41, "Agriculture,” apply to fair value measurements in annual reporting periods beginning after January 1, 2022; the Amendments on IFRS 1," First-time Adoption of IFRSs,” apply retroactively to annual reporting periods beginning after January 1, 2022.

• Note 2: This amendment applies to business mergers for which the acquisition date begins after January 1, 2022 in the annual reporting period.

• 13 -

• Note 3: This amendment applies to plant, property and equipment in the location and condition necessary to achieve management's intended mode of operation after January 1, 2021.

• Note 4: This amendment applies to contracts with all obligations outstanding as of January 1, 2022.

As of the date of publication of this financial statements, the Company has assessed that the above amendments have no material impact on the Company. However, the Company continues to assess the impact of the Amendments on other standards and interpretations on the financial position and financial performance. The related impact will be disclosed upon completion of the assessment.

(III) IFRSs published by the IASB but not yet recognized by the FSC and issued into effect

issued into effect
Newly issued/revised/amended standards and interpretation Amendment on IFRS 10 and IAS 28 "Sale or contribution of assets between an Investor and its associates or joint venture" IFRS 17 "Insurance contract" Amendment on IFRS 17 Amendment to IFRS 17 "Initial Application of IFRS 17 and IFRS 9―Comparative Information" Amendment on IAS 1 "Classification of liabilities as current or non-current" Amendment on IAS 1 "Disclosure of Accounting Policies" Amendments on IAS 8 "Definition of Accounting Estimates" Amendment to IAS 12 "Deferred Income Taxes Related to Assets and Liabilities Arising from a Single Transaction"	Effective date of issuance byIASB(note 1)
	Not established January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 (note 2) January 1, 2023 (note 3) January 1, 2023 (note 4)

Note 1: Unless otherwise stated, the above new/amended/revised standards or interpretations are effective for annual reporting periods beginning after the respective dates. Note 2: Effective for annual reporting periods beginning after January 1, 2023. Note 3: This amendment applies to changes in accounting estimates and accounting policies that occur in annual reporting periods beginning after January 1, 2023.

• 14 -

Note 4: The amendment applies to transactions occurring after January

1, 2022, except for the recognition of deferred income taxes on temporary differences between leases and ex-service obligations as of January 1, 2022.

As of the date of publication of this financial statements, the Company has assessed that the above amendments have no material impact on the Company. However, the Company continues to evaluate the impact of IFRSs issued by the IASB but not yet recognized by the FSC and issued into effect on each period's financial position and financial performance, which will be disclosed when the evaluation is completed.

IV. Summary of significant accounting policies

• (I) Compliance announcement

The financial statements are in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and the IFRSs recognized by the Financial Supervisory Commission.

• (II) Preparation basis

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

Fair value measurements are classified into Levels 1 to 3 based on the degree of observability and significance of the relevant inputs.

1. Level 1 inputs: Quoted prices (unadjusted) in active markets for identical assets or liabilities available at the measurement date.

2. Level 2 inputs: Inputs other than those quoted in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices).

3. Level 3 inputs: Unobservable inputs of assets or liabilities.

4. (III) Criteria for distinguishing the standard between current and non-current assets and liabilities Total current assets include:

5. Assets held primarily for transaction purposes;

6. Assets expected to be realized within 12 months of the date on the balance sheet; and

7. Cash and cash equivalents (other than those restricted for exchange or settlement of liabilities more than 12 months after the date on the balance sheet).

8. Total current liabilities include:

9. Liabilities held primarily for transaction purposes;

10. liabilities expected to be settled within 12 months of the date on the balance sheet; and

11. 15 -

12. Liabilities whose maturity cannot be unconditionally deferred to at least 12 months after the date on the balance sheet.

Assets or liabilities other than those mentioned above are classified as non-current assets or non-current liabilities.

(IV) Foreign currencies

When the Company prepares financial statements, transactions in currencies other than the Company's functional currency (foreign currencies) are recorded in the functional currency based on the transaction date's exchange rate. Monetary items denominated in foreign currencies are translated at the closing rate at each balance sheet date. Exchange differences arising from the settlement of foreign exchange or the translation of foreign currencies are recognized in profit or loss in the period in which they occur.

Non-monetary items measured at fair value in foreign currencies are translated at the exchange rates prevailing on the date when the fair value was determined, and the resulting exchange differences are recorded in profit or loss for the period, except for those arising from changes in fair value recognized in other comprehensive income.

Non-monetary items denominated in foreign currencies that are measured at historical cost are translated at the exchange rates prevailing on the dates of transactions, and are not retranslated.

In preparing the financial statements, the assets and liabilities of the Company's foreign entities are translated into New Taiwan Dollars using the exchange rate at each balance sheet date. Income and expense items are translated at the average exchange rate for the period, and the resulting exchange differences are recognized in other comprehensive income.

If all interests in a foreign entity are disposed of, or part of an interest in a foreign operation is disposed of, but control over the cumulative translation differences associated with that foreign operation is lost, the difference is reclassified to profit or loss.

In the case of any other partial disposal of a foreign operation (i.e., a reduction in the Company's ownership interest in an affiliate without a significant loss), the cumulative translation difference is reclassified to profit or loss in proportion to the disposal.

• (V)

• Investments in Associates

An associate is an entity over which the Company has significant influence but is not a subsidiary or a joint venture.

The Company applies the equity method to its investments in the associates.

Under the equity method, investments in associates are initially recognized at cost. The carrying amount of the investment after the acquisition date increases or decreases in accordance with the Company's share of profit or loss of the associates and other comprehensive income or loss profit distribution. In addition, changes in equity in associates are recognized on a proportional basis to shareholdings.

• 16 -

The excess of the acquisition cost over the Company's share of the net fair value of the identifiable assets and liabilities of the affiliated companies at the date of acquisition is recorded as goodwill, which is included in the carrying amount of the investment and is not amortized; the excess of the Company's share of the net fair value of the identifiable assets and liabilities of the affiliated companies at the date of acquisition over the acquisition cost is recorded as profit or loss for the period.

If the Company does not subscribe for new shares of a related company in proportion to its shareholding, resulting in a change in the Company's shareholding and an increase or decrease in the net equity of the investment, the increase or decrease is adjusted to capital surplus - change in net equity of the related company recognized under the equity method and the investment under the equity method. However, if the ownership interest in an associate is reduced as a result of not subscribing for or acquiring shares in proportion to the ownership interest, the amount recognized in other comprehensive income or loss related to the associate is reclassified to the same basis of accounting as that required for the direct disposal of the related assets or liabilities of the associate. If the former adjustment is charged to capital surplus, the balance of capital surplus from investments accounted for using the equity method is not sufficient, the difference is debited to retained earnings.

The recognition of further loss ceases when the Company's share of loss in an associate equals or exceeds its interest in the associate (including the carrying amount of its investment in the associate under the equity method and other long-term interests that are in substance a component of the Company's net investment in the associate). The Company recognizes additional loss and liabilities only to the extent that legal obligations, constructive obligations or payments on behalf of associates have been incurred.

In assessing impairment, the Company treats the entire carrying amount of an investment as a single asset, compares the recoverable amount with the carrying amount, and performs an impairment test. The impairment loss recognized is not allocated to any asset, including goodwill, that forms part of the investment's carrying amount. Any reversal of impairment loss is recognized to the extent that the investment's recoverable amount subsequently increases.

The Company ceases to adopt the equity method from the date its investment ceases to be an associate and its retained interest in the associate is measured at fair value. The difference between the fair value and the disposal price and the carrying amount of the investment on the date of cessation of the equity method is recognized in profit or loss for the current period. In addition, all amounts recognized in other comprehensive income are accounted for on the same accounting treatment, as if such assets or liabilities have been directly disposed of by the associate.

• 17 -

Profit or loss resulting from counter-flow, downflow and side-flow transactions between the Company and its associates are recognized in the financial statements only to the extent that they are not related to the Company's interest in the associates.

• (VI) Property, Plant and Equipment

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

No depreciation is provided for owned land.

Property, plant and equipment are depreciated on a straight-line basis over their useful life, with separate depreciation for each material component. The Company reviews the estimated useful life, residual values and depreciation methods at least once at the end of each year. It defers the effect of changes in applicable accounting estimates.

When property, plant and equipment are derecognized, the difference between the net disposal proceeds and the carrying amount of the assets is recognized in profit or loss.

• (VII) Real estate investment

Real estate investment is real estate property held to earn rental income or for capital appreciation, or both. Real estate investment also includes land held for future use and the purpose is yet to be determined.

Real estate investment is measured initially at cost (including transaction costs) and subsequently at cost less accumulated depreciation and accumulated impairment loss. The Company applies a straight-line basis for depreciation.

When real estate investments are derecognized, the difference between the net disposal proceeds and the carrying amount of the assets is recognized in profit or loss.

• (VIII) Impairment of property, plant and equipment, and real estate investment

• The Company assesses at each balance sheet date whether there is any indication that property, plant and equipment and real estate investment may have been impaired. If any indication of impairment exists, the recoverable amount of the asset is estimated. If the recoverable amount of an individual asset cannot be estimated, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Shared assets are allocated to individual cash-generating units on a reasonable and consistent basis.

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

When an impairment loss is subsequently reversed, the carrying amount of the asset or cash-generating unit is increased to the revised recoverable amount, provided that the increased carrying amount does not exceed the carrying amount (net of amortization or depreciation) that would have been determined if the impairment loss had not been

• 18 -

recognized in prior years for that asset or cash-generating unit. Reversal of impairment loss is recognized in profit or loss.

• (IX) Financial Instruments

Financial assets and financial liabilities are recognized in the balance sheet when the Company becomes a party to the instrument's contractual provisions.

When the original recognition of financial assets and financial liabilities that are not measured at fair value through profit or loss are measured at fair value plus transaction costs directly attributable to the acquisition or issuance of the financial assets or financial liabilities. Transaction costs directly attributable to the acquisition or issuance of financial assets or financial liabilities measured at fair value through profit or loss are recognized immediately in profit or loss.

1. Financial asset

Regular transactions of financial assets are recognized and derecognized using trade date accounting.

• (1) Type of measurement

The types of financial assets held by the Company are financial assets measured at fair value through profit or loss, financial assets at amortized cost, and investments in equity instruments measured at fair value through other comprehensive income.

• A. Financial asset measured at fair value through profit or loss

• Financial assets measured at fair value through profit or loss are financial assets that are mandatorily measured at fair value through profit or loss. Financial assets that are mandatorily measured at fair value through profit or loss include investments in equity instruments that the Company has not designated as measured at fair value through other comprehensive income or loss, and investments in debt instruments that do not qualify for classification as measured at amortized cost or measured at fair value through other comprehensive income or loss.

• Financial assets measured at fair value through profit or loss are measured at fair value. The profit or loss arising from their re-measurement (including any dividends or interest generated from the financial assets) is recognized in profit or loss. Please refer to note 19 for the determination of fair value.

• B. Financial assets measured at amortized cost

The Company's investment financial assets are classified as financial assets measured at amortized cost if both of the following conditions are met:

• a. Held under a business model whose objective is to hold financial assets to collect contractual cash flows; and

• 19 -

• b. The terms of the contracts give rise to cash flows at specified dates that are solely for the payment of principal and interest on the outstanding principal amount.

Financial assets measured at amortized cost (including cash and cash equivalents, accounts receivable and other receivables) are measured at their total carrying amount determined using the effective interest method less the amortized cost of any impairment loss after initial recognition, with any foreign currency translation profit or loss recognized in profit or loss.

Cash equivalents include time deposits that are highly liquid, readily convertible into fixed amounts of money with minimal risk of changes in value within three months from the date of acquisition. They are used to meet short-term cash commitments.

• C. Investments in equity instruments measured at fair value through other comprehensive income or loss

On initial recognition, the Company has an irrevocable option to designate investments in equity instruments that are not held-for-trading and not acquired in a business combination with contingent consideration to be measured at fair value through other comprehensive income.

Investments in equity instruments measured at fair value through other comprehensive income are measured at fair value, with subsequent changes in fair value reported in other comprehensive income and accumulated in other equity. Upon disposal of investments, the accumulated profit and loss are transferred directly to retained earnings and are not reclassified to profit or loss.

Dividends from investments in equity instruments measured at fair value through other comprehensive income or loss are recognized in profit or loss when the Company's right to receive them is established unless the dividend clearly represents a partial recovery of the cost of the investment.

• (2) Impairment of financial assets

The Company assesses impairment on financial assets, lease receivables, and contract assets measured at amortized cost at each balance sheet date based on expected credit loss.

Accounts receivable, lease receivables, and contract assets are recognized as an allowance for loss based on expected credit loss over the period of their existence. Other financial assets are first evaluated to determine whether there is a significant increase in credit risk since initial recognition. If there is no significant increase, an allowance for loss is recognized based on the 12-month

• 20 -

expected credit loss. If there is a significant increase, an allowance for loss is recognized based on the expected credit loss over the remaining period.

Expected credit loss is a weighted average credit loss weighted by the risk of default. The 12-month expected credit loss represents the expected credit loss arising from possible defaults of the financial instruments within 12 months after the reporting date. The ongoing expected credit loss represents the expected credit loss arising from all possible defaults of the financial instruments during the financial instruments' expected life.

All impairment on financial assets is reversed by reducing the carrying amount through an allowance account.

• (3) Derecognizing of financial assets

The Company derecognizes financial assets only when the contractual rights to the cash flows from the financial assets have lapsed or when the financial assets have been transferred and substantially all the risks and rewards of ownership of the assets have been transferred to other enterprises.

The difference between the carrying amount of the financial asset and the consideration received is recognized in profit or loss when the financial asset is derecognized as a whole measured at amortized cost. When investments in equity instruments measured at fair value through other comprehensive income are derecognized as a whole, the cumulative profit or loss is transferred directly to retained earnings and is not reclassified to profit or loss.

1. Financial liability

2. (1) Subsequent measurement

Financial liabilities measured at amortized cost are measured using the effective interest method, except for short-term accounts payable, where interest recognition is not material.

• (2) Derecognizing of financial liabilities

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

• (X) Revenue Recognition

After the Company identifies performance obligations in customer contracts, the transaction price is apportioned to each performance obligation and revenue is recognized when each performance obligation is satisfied.

1. Rental income

Rental income is recognized in accordance with IFRS 16, "Leases,” and is recognized monthly for the realized portion.

• 21 -

• Education and entertainment

The income from Education and entertainment revenue is recognized when the services are rendered, and is measured at the transaction price agreed between the Company and the contracting parties.

(XI) Leasing

The Company is the lessor

The Company assesses whether a contract is (or contains) a lease at the contract inception date.

A lease is classified as a finance lease when the terms of the lease transfer substantially all the risks and rewards incidental to the ownership of the asset to the lessee. All other leases are classified as operating leases.

Under operating leases, lease payments net of lease incentives are recognized as income on a straight-line basis over the term of the relevant lease. The original direct cost incurred in acquiring an operating lease is added to the subject asset's carrying amount and recognized as an expense on a straight-line basis over the lease term.

Rentals under leases that do not depend on changes in indices or rates are recognized as income in the period in which they are incurred.

(XII) Government grants Government grants are recognized only when there is reasonable assurance that the Company will comply with the conditions attached to the government grant and that the grant will be received.

Government grants related to revenue are recognized in other income on a systematic basis over the period in which the related costs intended to be reimbursed are recognized as expenses by the Company.

Government grants are recognized in profit or loss in the period in which they become receivable if they are intended to compensate for expenses or loss already incurred or to provide immediate financial support to the Company and have no future related costs.

(XIII) Employee benefits

1. Short-term employee benefits

Short-term employee benefit-related liabilities are measured at the non-discounted amount expected to be paid in exchange for employee services.

1. Post-employment benefits

The defined contribution pension plan is an expense that recognizes the amount of pension benefits to be contributed during the employees' service period. The defined benefit cost (including service cost, net interest and re-measurement) of the defined benefit pension plan is actuarially determined using the projected unit benefit method. Service cost and net interest on net defined benefit liabilities (assets)

• 22 -

are recognized as employee benefit expenses as incurred. Re-measurements (including actuarial profit and loss and return on planned assets, net of interest) are recognized in other comprehensive income and included in retained earnings as incurred and are not reclassified to profit or loss in subsequent periods.

The net defined benefit liabilities (assets) represent the deficit (remaining) of the defined benefit pension plan contribution. The net defined benefit assets may not exceed the present value of refunds of contributions from the plan or reductions in future contributions.

• (XIV) Income tax

Income tax expense is the sum of current income tax and deferred income tax.

1. Current income tax

2. The Company determines the current income in accordance with the Income Tax Act and calculates the income tax payable accordingly.

Income tax on undistributed earnings calculated in accordance with the Income Tax Act is recognized in the year when the shareholders resolve to retain the earnings. Adjustments to prior years' income tax payable are included in the current period's income tax.

1. Deferred income tax

Deferred income tax is calculated on temporary differences between the carrying amounts of assets and liabilities and the tax bases used to compute taxable income. Deferred income tax assets and liabilities are not recognized for temporary differences arising from the initial recognition of assets and liabilities that have no impact on either taxable income or accounting profit.

Deferred income tax liabilities are generally recognized for all taxable temporary differences, while deferred income tax assets are recognized to the extent that it is probable that taxable profit will be available against which income tax credits can be utilized.

Deferred income tax liabilities are recognized for taxable temporary differences associated with investments in associates, except where the Company can control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax assets are recognized for deductible temporary differences associated with such investments only to the extent that it is probable that sufficient taxable income will be available to allow the temporary differences to be realized and to the extent that a reversal is expected in the foreseeable future.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient tax assets

• 23 -

will be available to allow recovery of all or part of the asset. Deferred income tax assets that were not recognized as such are reviewed at each balance sheet date. The carrying amount is increased to the extent that it is probable that future taxable income will be available to recover all or part of the asset.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the liability is settled or the asset is realized, which are based on tax rates and tax laws that have been legislated or substantively legislated at the balance sheet date. The measurement of deferred income tax liabilities and assets reflects the tax consequences of the manner in which the Company expects to recover or settle the carrying amounts of its assets and liabilities at the balance sheet date.

1. Current and deferred income taxes for the year

Current and deferred income taxes are recognized in profit or loss, except for current and deferred income taxes related to items recognized in other comprehensive income or directly in equity, which are recognized in other comprehensive income or directly in equity, respectively.

• V. Significant accounting judgments, estimations, and assumptions, and other major sources of estimation uncertainty

When the Company adopts accounting policies, management must make judgments, estimates, and assumptions based on historical experience and other relevant factors when relevant information is not readily available from other sources. Actual results may be different from the estimates.

Management will continue to review estimates and underlying assumptions. If a revision to an estimate affects only the current period, it is recognized in the period in which the revision is made. If a revision of an accounting estimate affects both the current and future periods, it is recognized in the period in which the revision is made and in the future period.

VI. Cash and cash equivalents

Cash and cash equivalents
Cash on hand and working capital Bank checks and demand deposits	December31,2021 $ 791 160,568 $ 161,359	December31,2020
			$ 439 167,246 $ 167,685

VII.	Financial assets at fair value through profit or loss December31,2021 Mandatory financial assets measured at fair value through profit or loss Fund beneficiary certificate $ 111,531	Financial assets at fair value through profit or loss December31,2021 Mandatory financial assets measured at fair value through profit or loss Fund beneficiary certificate $ 111,531	December31,2020	December31,2020
	Mandatory financial assets measured at fair value through profit or loss Fund beneficiary certificate
				$ 111,308

• 24 -

VIII. Financial assets at amortized cost - current

Financial assets at amortized cost-current
Fixed-term deposits with an original maturity of more than 3 months Deposit Range of the interest rate	December31,2021 $ 1,294,471 0.38%～2.00%	December31,2020
		$ 1,241,517 0.38%～1.70%

IX. Financial assets at fair value through other comprehensive income or loss - non-current

Investment in equity instruments - Domestic Publicly traded stocks Non-Publicly traded stock Investment in equity instruments – Foreign Non-Publicly traded stock	December31,2021 $ 1,595,752 1,007,930 2,603,682 101,983 $ 2,705,665	December31,2020	December31,2020
			$ 1,527,000 976,001 2,503,001 98,933 $ 2,601,934

The Company invests for long-term and expects to make a profit from its investments over the long term. The Company's management believes that it would be inconsistent with the aforementioned long-term investment plan to include short-term fair value fluctuations of these investments in profit or loss, and has therefore elected to designate these investments as measured at fair value through other comprehensive income.

The Company recognized dividend income of $42,463 thousand and $75,847 thousand for 2021

and 2020, respectively. The amount related to those who still held the shares was $42,463 thousand and $75,847 thousand for the years ended December 31, 2021 and 2020, respectively.

X. Investments accounted for using the equity method

Investments in Affiliated enterprise Investments in Affiliated enterprise Significant associates Today's Hotel Corporation Individually insignificant associates Wan Hwa International Investment Company Ltd.	December31,2021 December31,2020 $ 2,695,285 $ 2,857,136 December31,2021 December31,2020 $ 2,438,074 $ $ 2,591,004 257,211 266,132 $ 2,695,285 $ 2,857,136	December31,2020
		$ 2,857,136 December31,2020

• 25 -

(I) Significant affiliated

Significant affiliated
Company Name Today's Hotel Corporation	Shareholding and votingrights
	December31,2021 30.36%	December31,2020
		30.36%

For the business nature, the main location of business and country information of the above affiliated, please refer to Appendix II, "Name of Investee Company, Location, and Other Related Information.”

Aggregate financial information of significant affiliated is as follows:

Today's Hotel Corporation

Today's Hotel Corporation
Current asset Non-current assets Current liabilities Non-current liabilities Equity The Company’s shareholding ratio Rights and interests the Company holds Operating income Net profit (loss) of the year Other comprehensive income Total comprehensive income	December31,2021 $ 3,844,520 7,348,740 ( 685,280 ) ( 2,477,434) 8,030,546 30.36% $ 2,438,074 2021 $ 2,453,549 ( $ 267,135 ) - ($ 267,135)	December31,2020
		$ 3,840,646 7,952,384 ( 507,843 ) ( 2,750,917) 8,534,270 30.36% $ 2,591,004 2020
		$ 1,926,647 ( $ 104,429 ) - ($ 104,429)

(II) Information on individually insignificant affiliated

Information on individually insignificant	affiliated
Equities the Company holds Net profit (loss) of the year Other comprehensive income Total comprehensive income	2021 ( $ 1,462 ) - ($ 1,462)	2020
		$ 6,322 - $ 6,322

The equity-method investments' share of profit or loss and other comprehensive income or loss for 2021 and 2020 were recognized in accordance with the audited financial statements.

• 26 -

XI. Property, Plant and Equipment

										Plumbing and	Plumbing and
							Machinery				electrical
	Ownedland				Building			equipment			equipment	Other	equipment			Total
Cost
Balance at January 1, 2020	$	343,662		$	54,974		$	15,742		$	5,144	$	1,970		$	426,492
Addition		-			-			648			-		-			648
Disposal		-			-	(		3,714)	(		110)		-	(		3,824)
Balance at December 31, 2020		343,662			54,974			12,676			5,034		1,970			418,316
Accumulated depreciation
Balance at January 1, 2020		-			50,336			13,447			3,646		1,004			68,433
Disposal		-			-	(		3,714 )	(		110 )		-	(		3,824 )
Depreciation expense		-			1,318			935			325		223			2,801
Balance at December 31, 2020		-			51,654			10,668			3,861		1,227			67,410
Net balance at December 31, 2020	$	343,662		$	3,320		$	2,008		$	1,173	$	743		$	350,906
Cost
Balance at January 1, 2021	$	343,662		$	54,974		$	12,676		$	5,034	$	1,970		$	418,316
Addition		-			-			13			-		-			13
Disposal		-	(		6,101)	(		2,539)	(		76)	(	429)	(		9,145)
Balance at December 31, 2021		343,662			48,873			10,150			4,958		1,541			409,184
Accumulated depreciation
Balance at January 1, 2021		-			51,654			10,668			3,861		1,227			67,410
Disposal		-	(		6,101 )	(		2,539 )	(		76 )	(	429 )	(		9,145 )
Depreciation expense		-			1,009			808			316		218			2,351
Balance at December 31, 2021		-			46,562			8,937			4,101		1,016			60,616
Net balance at December 31, 2021	$	343,662		$	2,311		$	1,213		$	857	$	525		$	348,568

The Company applies a straight-line basis for depreciation over the useful life of property, plant and equipment:

Building Main building 37 to 55 years Main renovation work 32 to 37 years Machinery equipment Fire-fighting equipment 8 years Elevators 12 to 17 years Air conditioning equipment 5 to 10 years Plumbing and electrical equipment 10 to 15 years Other equipment Property, plant and equipment 5 to 10 years

As of December 31, 2021 and 2020, there were no guarantees or endorsements for property, plant and equipment.

XII. Real estate investment

Real estate investment
Cost Balance at January 1, 2020 Balance at December 31, 2020 Accumulated depreciation Balance at January 1, 2020 Depreciation expense Balance at December 31, 2020 Net balance at December 31, 2020 Cost Balance at January 1, 2021 Disposal Balance at December 31, 2021 Accumulated depreciation Balance at January 1, 2021 Disposal Depreciation expense Balance at December 31, 2021 Net balance at December 31, 2021		Land 1,328,167 $ - - - $ 1,328,167 $ 1,328,167 - 1,328,167 - - - - $ 1,328,167		Building 233,903 $ 214,999 5,719 220,718 $ 13,185 $ 233,903 ( 45,304) 188,599 220,718 ( 45,304) 4,516 179,930 $ 8,669		Total
						1,562,070 $ 214,999 5,719 220,718 $ 1,341,352 $ 1,562,070 ( 45,304) 1,516,766 220,718 ( 45,304) 4,516 179,930 $ 1,336,836

• 27 -

Due to the severe impact of the COVID-19 pandemic on the market economy in 2021 and 2020, the Company agreed to calculate lease income based on revenue for certain months on some lease contracts.

The Company applies a straight-line basis for depreciation on real estate investment:

Building
Main building	37	to	55	years
Main renovation work	32	to	37	years

As of December 31, 2021 and 2020, there were no guarantees or endorsements for investment properties.

As of December 31, 2021 and 2020, the net carrying amount of the Company's real estate investment was $130,552 thousand. The Company's real estate investments are located in Longtan District, Taoyuan City, which is not a general residential or commercial land use. Hence comparable market transactions are infrequent and reliable alternative fair value estimates are not available. The remaining real estate investment are commercial buildings in Taipei City with a net book value of $1,206,284 thousand and $1,210,800 thousand as of December 31, 2021 and 2020, respectively, and a fair value of $6,972,108 thousand and $6,864,157 thousand, respectively, which were evaluated by the Company's management with reference to market evidence of similar real estate transaction prices and are classified as Level 3 input values.

The leases of real estate investment owned by the Company are operating leases, which will all be expired by the end of July 2027. The rent is calculated by reference to the neighboring shopping mall's rent and adjusted according to the lease agreement. The rent is collected monthly. The lessee does not have a preferential right to acquire the real estate at the end of the lease term.

As of December 31, 2021 and 2020, the Company had received $95,266 thousand and $ thousand (recorded as deposits received) as security deposits for operating lease contracts. The total future rental income receivable by the Company for real estate investment leased under operating leases are as follows:

under operating leases are as follows:
Year one Year two Year three Year four Year five After year five	December31,2021 $ 218,070 219,684 187,095 110,288 106,099 146,522 $ 887,758	December31,2020
			$ 212,695 205,890 207,609 175,599 110,288 152,640 $ 1,064,721

• 28 -

In addition to the aforementioned rental income receivables, the Company's real estate leasing contracts also contain contingent rental clauses that allow the lessee to pay contingent rentals based on a specified percentage of its monthly sales in excess of the contracted amount. The Company’s contingent rental income of $ 0 thousand and $3,588 thousand was recognized in 2020 and 2019, respectively.

The Company’s assets recognized for lease incentives granted under operating leases are as follows:

follows:
Lease incentives Long-term receivables	December31,2021 $ 56,048	December31,2020
			$ 61,299

XIII. Post-employment benefit plans

• (I) Defined contribution plans

  • The Company applies the pension system under the Labor Pension Act, which is a government-administered defined contribution pension plan that contributes 6% of employees' monthly salaries to the individual accounts of the Bureau of Labor Insurance. For the years 2021 and 2020, the Company recognized $364 thousand and $353 thousand, respectively, as operating expenses in the consolidated statements of income in accordance with the proportionate share of the defined contribution plan.

• (II) Defined benefit plan

The Company has implemented the Labor Standards Act (the "Labor Standards Act") since April 1, 1998. When the seniority of the Company's employees prior to the implementation of the Labor Standards Act is calculated in accordance with the "Regulations Governing the Implementation of Retirement and Resignation" under the "Personnel Management Regulations" implemented on January 1, 1989, applies for retirement or is being laid off, its seniority is divided into two parts to calculate pension or severance pay as the following: (1) Seniority prior to the implementation of the Labor Standards Act shall be paid in accordance with the provisions of the Regulations Governing Retirement and Resignation of the Company's Personnel Management Regulations effective January 1, 1989. (2) The seniority after the implementation of the Labor Standards Act shall be in accordance with the provisions of the Labor Standards Act.

Under the Labor Standards Act (before the amendment), the pension plan is a defined benefit pension plan administered by the government. Since August 2003, a monthly pension contribution of 2% of salaries and wages has been paid to the Labor Retirement Reserve Fund Supervisory Committee and deposited in the same name in a special account at the Bank of Taiwan. If the estimated balance of the special account before the end of the year is not enough to pay for the workers who are expected to meet the retirement requirements in the following year, the difference will be withdrawn in one lump sum by the end of March of

• 29 -

the following year. The account is entrusted to the Bureau of Labor Fund of the Ministry of Labor, and the Company has no right to influence the investment strategy.

The amounts included in this balance sheet for defined benefit plans are shown below:

Present value of a defined benefit obligation Fair value of planned assets Shortfall of appropriation (net defined benefit liabilities)	December31,2021 $ 8,251 ( 7,643) $ 608	December31,2020	December31,2020
	(	(	$ 8,729 8,455) $ 274

Changes in the net defined benefit liabilities are as follows:

January 1, 2020 Servicing costs Current servicing cost Interest expenses (income) Recognition in profit or loss Re-measurement Return on planned assets (other than amounts included in net interest) Actuarial loss - financial assumptions Changes Actuarial benefit - experience adjustment Other comprehensive income recognized Contribution by the employer Payment of benefits December 31, 2020 January 1, 2021 Servicing costs Current servicing cost Interest expenses (income) Recognition in profit or loss Re-measurement Return on planned assets (other than amounts included in net interest) Actuarial loss - population assumptions Changes Actuarial loss - financial assumptions Changes Actuarial benefit - experience adjustment Other comprehensive income recognized Contribution by the employer Payment of benefits December 31, 2020	Present value of a defined benefit obligation $ 9,392 202 59 261 $ - 140 ( 61) 79 - ( 1,003) $ 8,729 $ 8,729 177 33 210 - 271 ( 66) 203 408 - ( 1096) $ 8,251		Fair value of planned assets $ 8,952) - 56) 56) $ 313 ) - - 313) 137) 1,003 $ 8,455) $ 8,455) - 32) 32) 117) - - - 117) 135) 1,096 $ 7,643)	Net defined benefit liabilities	Net defined benefit liabilities
	( ( ( (	( ( ( ( ( ( ( ( ( ( ( ( ( (		( ( ( ( ( ( (	$ 440 202 3 205 $ 313 ) 140 61) 234) 137) - $ 274 $ 274 177 1 178 117 ) 271 66) 203 291 135) - $ 608

The Company is exposed to the following risks due to the pension system under the Labor Standards Act:

• 30 -

• Investment risk: The Bureau of Labor Fund of the Ministry of Labor invests the Labor Pension Fund in domestic and foreign equity securities, debt securities and bank deposits through its own and entrusted operations, but the Company's plan assets are distributed at an amount not less than the interest rate of a two-year time deposit in a local bank.

• Interest rate risk: A decrease in interest rates will increase the present value of the defined benefit obligation, but the investment return on plan assets will also increase, which will have a partially offsetting effect on the net defined benefit liabilities.

• Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salary of the members in the plan. Therefore, increases in plan members' salaries will result in an increase in the present value of the defined benefit obligation.

A qualified actuary actuarially determined the present value of the Company's defined benefit obligation and the significant assumptions at the measurement date were as follows:

Discount rate Expected rate of salary increase	December 31,2021 0.5% 1.00%	December 31,2020
		0.375% 1.00%

The amount by which the present value of the defined benefit obligation would increase (decrease) if there were possible changes in significant actuarial assumptions, respectively, with all other assumptions held constant, is as follows:

with all other assumptions held constant,	is as follows:
Discount rate 0.25% increase 0.25% decrease Expected rate of salary increase 0.25% increase 0.25% decrease	December31,2021 ($ 132) $ 136 $ 133 ($ 130)	December31,2020
	( (	( (	$ 140) $ 144 $ 141 $ 137)

The sensitivity analysis above may not reflect actual changes in the defined benefit obligation's present value because the actuarial assumptions may be correlated and changes in only one assumption are not probable.

in only one assumption are not probable.
Amount expected to be contributed within 1 year Average period of defined benefit obligation until its withdrawal	December31,2021 $ 133 6.4 years	December31,2020
			$ 140 6.4 years

• 31 -

XIV. Equity

• (I) Share capital - common shares

Share capital - common shares
Registered shares (in thousands) Registered capital Number of issued and fully paid shares (in thousands) Issued capital	December31,2021 450,000 $ 4,500,000 449,968 $ 4,499,678	December31,2020
			450,000 $ 4,500,000 449,968 $ 4,499,678

The issued common share has a par value of NTD10 per share and each share is entitled to one vote and the right to receive dividends.

• (II) Policies on earnings retention and dividend

In accordance with the Company's Articles of Incorporation, 10% of the Company's annual earnings, if any, shall be set aside as legal reserves after the Company has paid tax and made up for the accumulated loss in accordance with the law. However, when the legal reserves have reached the Company's paid-in capital, no further provision is necessary. The remainder

shall be set aside or reversed as a special reserves in accordance with the law. If there is any remaining balance, it shall be retained together with the accumulated undistributed earnings.

Except for business needs and tax consideration, the Board of Directors shall prepare a proposal for the appropriation of earnings and submit it to the shareholders' meeting for resolution on the distribution of dividends to shareholders.

The Company is a stable and growing company. In order to meet the operational development plan and achieve the goal of the diversified operation, and to consider the Company's future capital needs and long-term financial planning, incase shareholder dividend is distributed, the cash dividend portion should be no less than 10% of the shareholder dividend distributed that year.

When distributing earnings, the Company is required by law to

provide a special reserve for other net equity deductions. If there is a subsequent reversal of the balance of the other shareholders' equity reduction, the reversed portion of the surplus may be distributed.

The legal reserve should be appropriated until the remaining balance reaches the Company's total paid-in capital. The legal reserves may be used to make up loss. If the Company has no deficit, the excess of legal reserves over 25% of the paid-in capital may be distributed in cash in addition to capitalization.

At the annual shareholders' meetings held on June 10, 2021 and June 10, 2020, the Company resolved the following distribution of earnings for fiscal years 2020 and 2019, respectively:

• 32 -

Legal reserves Cash dividends	Proposalofearnings distribution 2021 2020 $ 17,435 $ 39,956 112,492 179,987	Dividends per	share (yuan)
	2021 $ 17,435 112,492	2021 $ 0.25	2020
			$ 0.40

On March 23, 2022, the Board of Directors proposed the following distribution of earnings for FY2020:

for FY2020:
Legal reserves Cash dividends	Proposal of earnings distribution $ 8407 74,245	Dividends per share (yuan)
		$ 0.165

• (III) Other equities items

• Exchange differences on translation of financial statements of foreign operating entities

entities
			2021		2020
Balance	at the beginning of
the year		(	$ 158,579)	( $	37,898 )
Generated in the current
year
Exchange differences
	arising from the
	translation of net
	assets of foreign
	operating entities	(	79,287 )	(	150,851 )
Income tax generated
	out of exchange
	differences arising
	from the translation
	of net assets of
	foreign operating
	entities		15,857		30,170
Total		(	63,430)	(	120,681 )
Balance	at the end of the
year		(	$ 222,009)	($	158,579)
Unrealiz	ed valuation profit or loss on	financial assets measured at fair			value through
other comprehensive income or loss
			2021		2020
Balance	at the beginning of
the year		$	695,517	$	839,170
Generated in the current
	year
Unrealized profit or
	loss
	Equity instrument		103,731	(	144,285 )
Income tax effects		(	609)		725
	Total		103,122	(	143,560 )
Balance	at the end of the
year			$ 798,693	$	695,571

1. Unrealized valuation profit or loss on financial assets measured at fair value through other comprehensive income or loss

2. 33 -

XV. Employee benefits and depreciation expenses

Employee benefit expense Salary expenses Labor and health insurance expenses Pension scheme expenses Remuneration Paid to Directors Others Depreciation expense		2021	2021	Total $ 9,411 930 542 2,920 1,000 $ 14,803 $ 6,867		2020
	Under operating costs $ 1,327 112 - - - $ 1,439 $ 6,446	Under operating expenses			Under operating costs $ 1,597 107 - - - $ 1,704 $ 8,000	Under operating expenses $ 8,389 801 558 3,720 1,000 $ 14,468 $ 520		Total
			$ 8,389 818 542 2,920 1,000 $ 13,364 $ 421					$ 9,986 908 558 3,720 1,000 $ 16,172 $ 8,520

The Company contributes a fixed amount of $1,000 thousand to employees' remuneration and no more than 3% to directors' remuneration based on the Company's profit for the year (profit is defined as earnings before deduction of employee and director's remuneration).

On March 23, 2021 and March 19, 2022, the Board of Directors resolved to allocate the following compensation to employees and directors for the years 2021 and 2020:

Number of allotments resolved by the Board of Directors Recognition of financial statements	2021 Employees’ cash remuneration Director remuneration $ 1,000 $ 2,920 $ 1,000 $ 2,920	2021 Employees’ cash remuneration Director remuneration $ 1,000 $ 2,920 $ 1,000 $ 2,920	2020	2020	2020
	Employees’ cash remuneration $ 1,000 $ 1,000		Employees’ cash remuneration $ 1,000 $ 1,000	Director remuneration
					$ 3,720 $ 3,720

If there is any change in the amount of the annual financial report after its issuance, the change in accounting estimate is treated as an adjustment in the following year.

There was no difference between the actual amount of employees' and directors' remuneration allotted in 2020 and 2019 and the amount recognized in the financial statements of 2020 and 2019.

For information on the remuneration of employees and directors as resolved by the Board of Directors in 2021 and 2020, please visit the Market Observation Post System of the Taiwan Stock Exchange.

• 34 -

XVI. Income tax

(I) Income tax expense recognized in profit or loss

Income tax expense is mainly composed by:

	Income tax expense is mainly composed by:
(II)	2020 2020 Current income tax Generated in the current year $ 23,388 $ 32,113 Tax on undistributed earnings 2,221 9,006 Adjustments to prior years - - 30,609 41,119 Deferred income tax Generated in the current year ( 17,591) ( 5,631) Income tax expense recognized in profit or loss $ 13,018 $ 35,488 The reconciliation of accounting income to income tax expense is as follows: 2021 2020 Net profit before tax $ 97,374 $ 209,608 Income tax expense on net income before income tax at the statutory rate (20%) $ 19,475 $ 41,922 Non-deductible expenses for tax purposes 9 13 Tax exempted income ( 8,687 ) ( 15,453 ) Tax on undistributed earnings 2,221 9,006 Adjustments to current income tax expense in prior years - - Income tax expense recognized in profit or loss $ 13,018 $ 35,488 Income tax expense (profit) recognized in other comprehensive income 2021 2020 Deferred income tax Generated in the current year －Exchange differences on translation of financial statements of foreign operating entities ( $ 15,857 ) ( $ 30,170 ) －Unrealized valuation profit or loss on financial assets measured at fair value through other comprehensive income or loss 609 ( 725) ($ 15,248) ($ 30,895)		2020
		( $ 30,170 ) ( 725) ($ 30,895)

• 35 -

(III) Deferred income tax assets and liabilities

Change on deferred income tax assets and liabilities:

2021

2021
Deferred income tax assets Temporary difference Unrealized exchange difference Exchange differences on translation of financial statements of foreign operating entities Deferred income tax liabilities Temporary difference Investment profit or loss recognized under the equity method Financial assets measured at fair value through other comprehensive income or loss Lease incentives Land value increment tax		Beginning Balance $ 258 39,646 $ 39,904 Beginning Balance $ 534,908 8,967 12,260 439,917 $ 996,052	Recognition in profit or loss $ 30 - ($ 30) Recognition in profit or loss ( $ 16,512 ) - ( 1,049 ) - ($ 17,561)	Recognized in Other Comprehensiv eIncome $ - 15,857 $ 15,857 Recognized in Other Comprehensiv e Income $ - 609 - - ($ )		Ending Balance $ 288 55,503 $ 55,791 Ending Balance $ 518,396 9,576 11,211 439,917 $ 979,100
			( ( (	(

• 36 -

2020

2020
Deferred income tax assets Temporary difference Unrealized exchange difference Exchange differences on translation of financial statements of foreign operating entities Deferred income tax liabilities Temporary difference Investment profit or loss recognized under the equity method Exchange differences on translation of financial statements of foreign operating entities Financial assets measured at fair value through other comprehensive income or loss Lease incentives Land value increment tax		Beginning Balance $ 326 9,476 $ 9,802 $ 539,985 9,692 12,882 439,917 $ 1,002,476	Recognition in profit or loss ($ 68) - ($ 68) ($ 5,077) - - ( 622) - $ 5,699	Recognition in others Consolidated profit or loss $ - 30,170 $ 30,170 $ - ( 725 ) - - ($ 725)		Ending Balance
			(	( (		$ 258 39,646 $ 39,646 $ 534,908 - 8,967 12,260 439,917 $ 996,052

(IV) The Company's income tax returns for 2019 have been examined by the tax authorities.

• 37 -

XVII. Earnings per share

Earnings per share
Basic earnings per share		2021 $ 0.19	Unit: NTD per share 2020 $ 0.39

The earnings and weighted-average number of common shares used to calculate basic earnings per share were as follows:

per share were as follows:
Net profit for the period (numerator) Weighted average common shares (denominator)		2021 $ 84,356 2021 449,968

XVIII. Capital risk management

The Company conducts capital management to ensure that the Company can maximize shareholder returns by optimizing debt and equity balances while continuing to operate.

The capital structure of the Company consists of the Company's equity (i.e., capital stock, retained earnings, and other equity items).

The Company's management regularly reviews the capital structure and considers the cost of capital and the risks associated with each type of capital. The Company may balance its overall capital structure by adjusting dividend distribution and issuing new shares.

XIX. Financial instruments

• (I) Fair value information - financial instruments not measured at fair value

The Company's management considers the carrying amounts of financial assets and liabilities that are not measured at fair value to approximate their fair values.

• (II) Fair value information - financial instruments measured at fair value on a recurring basis

• Fair value hierarchy

December 31, 2021

December 31, 2021
Financial asset measured at fair value through profit or loss Fund beneficiary certificate		Level 1 $ 111,531		Level 2 $ -		Level 3 $ -		Total
								$ 111,531

• 38 -

Financial assets measured at fair value through other comprehensive income or loss Investment in equity instruments － Domestic listed (over-the-counte r) equities － Equities not-listed (over-the counter) in the domestic or foreign markets December 31, 2020 Financial asset measured at fair value through profit or loss Fund beneficiary certificate Financial assets measured at fair value through other comprehensive income or loss Investment in equity instruments － Domestic listed (over-the-counte r) equities － Equities not-listed (over-the counter) in the domestic or foreign markets		Level 1 $1,595,752 - $1,595,752 Level 1 $ 111,308 $1,527,000 - $1,527,000		Level 2 $ - - $ - Level 2 $ - $ - - $ -		Level3 $ - 1,109,913 $1,109,913 Level3 $ - $ - 1,074,934 $1,074,934		Total
								$1,595,752 1,109,913 $2,705,665 Total
								$ 111,308 $1,527,000 1,527,000 $2,601,934

There were no transfers between Level 1 and Level 2 fair value measurements in 2021 and 2020.

• 39 -

• Reconciliation of financial instruments measured at fair value in Level 3 2021

Investments in equity instruments measured at fair value through other comprehensive Financial asset income or loss Balance at the beginning of the year $ 1,074,934 Recognized in other comprehensive income (unrealized valuation profit or loss on financial assets measured at fair value through other comprehensive income) ( 34,979 ) Balance at the beginning of the year $ 1,109,913

2020

Investments in equity instruments measured at fair value through other comprehensive Financial asset income or loss Balance at the beginning of the year $ 1,083,545 Recognized in other comprehensive income (unrealized valuation profit or loss on financial assets measured at fair value through other comprehensive income) 8,611 Balance at the beginning of the year $ 1,074,934

1. Valuation basis and assumptions used to measure fair value

2. (1) The fair values of financial instruments with standard terms and conditions and traded in active markets are determined by reference to quoted market prices (including listed (over-the-counter) equities and beneficiary certificates of open-end funds, etc.).

3. (2) The Company's financial assets measured at fair value in Level 3 are unlisted stocks measured at fair value using the income, market and asset methods. The major unobservable inputs include 21.45% and 19.68% of discount for lack of control as of the year end of December 31, 2021 and 2020, respectively, and 16.54% to 26.10% and 14.07% to 23.46% of discount for the year ended December 31, 2020 and 2019, respectively, for the lack of marketability risk. The fair value of the investments would decrease by $ thousand and $10,403 thousand, respectively, when the discount for the absence of control increases by 1%, and by $13,117 thousand and $13,094 thousand, respectively, when the discount for the lack of marketability increases by 1%.

4. 40 -

5. (III) Types of financial instruments

Types of financial instruments
Financial asset Financial asset measured at fair value through profit or loss Financial assets measured at amortized cost (Note 1) Financial assets measured at fair value through other comprehensive income or loss Financial liability Measured at amortized cost (Note 2)	December31,2020 $ 111,531 1,513,923 2,705,665 228,032	December31,2019
		$ 111,308 1,475,905 2,601,934 226,258

• Note 1: The balance consists of cash and cash equivalents, financial assets measured at amortized cost, other receivables, refundable deposits and long-term receivables measured at amortized cost.

• Note 2: The balance includes financial liabilities measured at amortized cost, such as accounts payable, certain other payables and deposits received.

• (IV) Financial risk management objectives and policies

The Company's major financial instruments include equity investments, cash and cash equivalents, time deposits with original maturities of more than three months, accounts receivable, other receivables, notes payable, accounts payable and other payables. The Company's management manages all operations and is responsible for identifying, evaluating and hedging the financial risks associated with the Company's operations to ensure that appropriate measures are taken in a timely and effective manner. Such risks include market risk (including interest rate risk and other price risks), credit risk and liquidity risk.

1. Market risk

2. (1) Interest rate risk

The time deposits held by the Company are mainly fixed-rate deposits; therefore, the impact of interest rate risk on financial assets is limited.

• (2) Other price risk

The Company incurs price risk as a result of investing in the Fund's beneficial certificates and equities. If the investment price increases/decreases by 2%, the Company's after-tax income and loss will increase/decrease by NTD2,231 thousand and NTD2,226 thousand for 2021 and 2020, and the after-tax other comprehensive income or loss will increase/decrease by NTD54,113 thousand and NTD52,039 thousand, respectively.

1. Credit risk

2. 41 -

Credit risk refers to the risk of financial loss resulting from the counter-party's default on contractual obligations. As of the balance sheet date, the Company's maximum exposure to the credit risk of financial loss due to non-performance by counter-parties is mainly from the carrying amount of financial assets recognized in the balance sheet. The Company's policy is to deal only with creditworthy counterparties and collect sufficient security deposits from lessees when signing operating lease agreements to mitigate the risk of financial loss arising from default.

The credit risk of bank deposits is limited because most of the counterparties are banks with certain credit ratings assigned by international credit rating agencies.

1. Liquidity risk

The Company manages and maintains sufficient cash and cash equivalents to support its operations and mitigate the impact of cash flow fluctuations. The Company also maintains some line of credit and continuously monitors expected and actual cash flows to manage liquidity risk.

As of December 31, 2021 and 2020, the Company has a line of credit to issue commercial paper financing of NTD400,000 thousand.

The following table details the analysis of the remaining contractual maturities of the Company's non-derivative financial liabilities with contractual repayment periods, based on the earliest possible date on which the Company could be required to make repayments and the undiscounted cash flows of the financial liabilities.

Accounts payable Other payables Deposits received Accounts payable Other payables Deposits received				December 31,2021	December 31,2021	December 31,2021
	Immediate to within 1 month $ 1,956 110,972 - $ 112,928	1 to 6 months $ - 5,770 - $ 5,770		6 to 12 months 1 to 5years $ 48 $ - 6,109 - - 40,002 $ 6,157 $ 40,002 December 31,2020			More than 5 years $ - - 67,264 $ 67,264	Total undiscounted cash flows
									$ 2,004 122,851 107,266 $ 232,121
	Immediate to within 1 month $ 3,181 107,525 - $ 110,706	1 to 6 months $ - 7,460 - $ 7,460		6 to 12 months $ 48 5,246 - $ 5,294		1 to 5years $ - - 40,002 $ 40,002	More than 5 years $ - - 67,264 $ 67,264	Total undiscounted cash flows
									$ 3,229 120,231 107,266 $ 230,726

• 42 -

XX. Related party transaction

(I) (II) (III)

Names of related parties and their relationships RelatedPartyDisclosures Relationship withthe Company Others Chairman, Directors, and Key Management Personnel of the Company There were no significant transactions between the Company and its related parties in 2021 and 2020. Key Management Compensation 2021 2020 Short-term employee benefits $ 6,005 $ 6,633 Post-employment benefits 116 106 $ 6,121 $ 6,739

XXI. Information on foreign currency assets and liabilities with significant effect The following information is expressed in aggregate in foreign currencies other than the Company's functional currency. The exchange rates disclosed represent the rates at which such foreign currencies were converted to the functional currency. The foreign currency assets and liabilities with significant effect are as follows: December 31, 2021

December 31, 2021
Foreign currency assets Monetary items Financial assets measured at amortized cost CNY Non-monetary items Financial assets measured at fair value through other comprehensive income or loss USD Investments accounted for using the equity method USD Foreign currency liability None	Foreigncurrency $ 4,667 3,684 97,373	Exchangerate 4.344(CNY: NTD) 27.68(USD: NTD) 27.68(USD: NTD)	Carrying amount
			$ 20,271 101,983 2,695,285

• 43 -

December 31, 2020 Foreign currency assets Monetary items Financial assets measured at amortized cost CNY Non-monetary items Financial assets measured at fair value through other comprehensive income or loss USD Investments accounted for using the equity method USD Foreign currency liability None	Foreigncurrency $ 4,596 3,474 100,321	Exchangerate 4.337(CNY: NTD) 28.48(USD: NTD) 24.48(USD: NTD)	Carrying amount
			$ 20,117 98,933 2,857,136

XXII. Other Matters The Company received a government subsidy of $748 thousand and $952 thousand (recorded as other income) in accordance with the "Regulations of the Ministry of Economic Affairs for the Relief and Revitalization of Industries Affected by COVID-19 and Experiencing Operational Difficulties” in 2021 and 2020.

Due to the impact of the COVID-19 pandemic, the global economic situation is undergoing a serious recession and contraction due to lockdown policies across many regions, and the Company's operation has also likewise been affected. Revenue from the Company’s entertainment business and the operating income of affiliated companies were more affected by the epidemic control measures and the change of consumers' consumption patterns due to the pandemic. In May 2021, with the aggravation of the epidemic in Taiwan, the Company's entertainment venues were suspended from operations due to the epidemic pre vention regulations. Recently, the epidemic in Taiwan has gradually subsided and the competent authorities have gradually relaxed the control

• 44 -

measures. The Company's entertainment venues have gradually reopened from July 2021 onwards. In the face of the ep idemic situation, the Company will continue to pay attention to and carefully respond accordingly in order to mitigate its impact on the Company.

XXIII. Other disclosures

• (I) Information on major transactions and (II) re-investment:

• Loan of funds to others: None.

• Endorsement and guarantee for others: None.

• Securities held at the end of the period (excluding investment in subsidiaries, associates and joint venture): Appendix I.

• Cumulative purchase or sale of the same securities amounting to at least NTD300 million or more than 20% of the paid-in capital: None.

• Acquisition of real estate amounting to at least NTD300 million or more than 20% of the paid-in capital: None.

• Disposal of real estate amounting to at least NTD300 million or more than 20% of the paid-in capital: None.

• Purchase or sale of goods with related parties amounting to at least NTD100 million or more than 20% of the paid-in capital: None.

• Receivables from related parties amounting to at least NTD100 million or more than 20% of the paid-in capital: None.

• Derivative transactions: None.

• Name of investee company, location, etc. (excluding Mainland China investee company): Appendix II.

• (III) Information on Mainland China investment: None.

• (IV) Information on major shareholders: Please refer to Appendix III for the names, amounts and percentages of shares held by shareholders with 5% or more shares.

XXIV. Information on the departments

The information provided to the chief operating decision maker for allocating resources and measuring departmental performance focuses on the type of product or service delivered or provided. The departments of the Company to be reported are as follows:

Leasing department - engaged in the leasing of commercial buildings.

Education and entertainment department - engaged in the operation of movie theaters and amusement arcades.

• 45 -

(I) Revenue of each department and operating results

Revenue from external customers Depreciation expense segment profit or loss Interest income General income and benefits of the Company General expenses and loss of the Company Profit before taxation		2021
	Lease department $ 165,408 $ 5,962 $ 132,453	Education and entertainment department $ 74,528 $ 484 $ 15,482		Total
			(	$ 239,936 $ 6,446 $ 147,935 10,129 52,192 112,882) $ 97,374

Revenue from external customers Depreciation expense Segment profit or loss Interest income General income and benefits of the Company General expenses and loss of the Company Profit before taxation		2020
	Lease department $ 186,054 $ 7,380 $ 150,439	Education and entertainment department $ 78,637 $ 620 $ 17,903		Total
			(	$ 264,691 $ 8,000 $ 168,342 12,212 85,637 56,583) $ 209,608

The revenue reported above is generated from transactions with external customers. There were no inter-department sales for 2021 and 2020.

Profit or loss of each department represents department revenues less costs and expenses; department costs and expenses represent costs and expenses related to the generation of department revenues, excluding investment loss and general expenses. This measure is provided to the chief operating decision maker to allocate resources to departments and measure their performance.

(II) Total assets across departments

Total assets across departments
Segment assets Investment The Company’s general assets Total assets		December31,2021
	Lease department $ 1,206,284		Education and entertainment department $ 120,179		Total
					$ 1,326,463 5,400,950 2,041,849 $ 8,769,262

• 46 -

Segment assets Investment The Company’s general assets Total assets		December 31,2020	December 31,2020
	Lease department $ 1,210,800		Education and entertainment department $ 120,663		Total
					$ 1,331,463 5,459,070 1,989,591 $ 8,780,124

(III) Regional information

The Company's 2020 and 2019 revenues were derived from its home country, so no regional information is available.

(IV) Information on important customer

Customers (all of which are in the leasing business) representing more than 10% of the Company's operating income are as follows:

Customer Customer A Customer B Customer C	2021	% of operating income 26 16 12	2020
	Amount $ 61,406 38,792 28,771		Amount $ 71,040 42,092 35,099	% of operating income
				27 16 13

• 47 -

Unit: NTD thousand

Wan Hwa Enterprise Company Ltd.

Securities held at the end of the period

December 31, 2021

Appendix I

Companies held	Types and names of securities	Relationships with the securities issuers	Account categories		End of period	End of period		Remarks
				Thousands of shares/Thousands of units	Carrying amount	Shareholding ratio	Fair value
Wan Hwa Enterprise Company Ltd.	Equities and fund beneficiary certificate First Hotel Company Ltd. Capital Securities Corp. Mega Financial Holding Co., Ltd. Taishin Financial Holdings Co., Ltd Chunghwa Telecom Co., Ltd Prudential Financial Money Market Fund SinoPac TWD Money Market Fund Today's Department Store Company Ltd. Dah Chung Bills Finance Corp. Kubo Investment Corporation Forward Time International, Ltd Mandarin Investment Corporation	－ － － － － － － The Chairman of the Company is the legal representative of the Company. － － － －	Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial asset measured at fair value through profit or loss - current Financial asset measured at fair value through profit or loss - current Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial assets measured at fair value through other comprehensive profit or loss - non-current Financial assets measured at fair value through other comprehensive profit or loss - non-current	99,001 9,907 50 20 1 3,557 3,890 5,082 34,084 1,985 1,962 377	$ 1,425,607 167,921 1,771 387 66 56,886 54,645 545,953 222,315 216,275 101,983 23,387	19.80 0.46 - - - - - 19.80 7.38 9.93 16.21 1.89	$ 1,425,607 167,921 1,771 387 66 56,886 54,645 545,953 222,315 216,275 101,983 23,387

• 48 -

Wan Hwa Enterprise Company Ltd.

Name of investee company, location, etc. January 1 through December 31 of 2021

Appendix II

Units: except for USD, which is in dollar, NTD is in thousands.

Name of investor	Name of investee	Locations	Main business activities	Initial amount of investment	Initial amount of investment	Holdingat the end of theperiod	Holdingat the end of theperiod	Holdingat the end of theperiod	Profit or loss of the investee company for theperiod	Investment profit or loss recognized by the Company	Remarks
				End of the period	End of the previous period	Numbers of shares (in thousands)	%	Carrying amount
Wan Hwa Enterprise Company Ltd. Wan Hwa Enterprise Company Ltd.	Today's Hotel Corporation Wan Hwa International Investment Company Ltd.	U.S.A British Virgin Islands	Tourist Hotel Mainly focused on overseas real estate investment	US$ 10,200,000 US$ 4,973,470	US$ 10,200,000 US$ 4,973,470	10,200 497	30.36 49.87	$ 2,438,074 257,211	( $ 267,135 ) ( 2,931 )	( $ 81,102 ) ( 1,462 )	Note Note

Note: Recognized on the basis of the financial statements audited by the accountants for year 2021.

• 49 -

Wan Hwa Enterprise Company Ltd.

Name of major Shareholders

December 31, 2021

Appendix III

Unit: Shares

Name of major shareholder	Share	Share
	No. of Shares Held	Shares Ratio
First Hotel Company Ltd. Today's Department Store Company Ltd. Zen Fong Investment Corporation Lee MingInvestment Corporation	89,809,699 89,809,699 52,258,768 39,503,789	19.95% 19.95% 11.61% 8.77%

• Note 1: The information on major shareholders in this table is based on the last business day of the quarter of Taiwan Depository & Clearing Corporation in which the shareholders held 5% or more of the Company's common shares and preferred shares that had been delivered without physical registration (including treasury shares). The share capital recorded in the Company's financial statements and the actual number of shares delivered without physical registration may differ from the basis of preparation of the calculation.

• Note 2: The above information is revealed by the trustees' individual subaccounts of the trustees opened by the trustees if the stockholders deliver their holdings to the trust. As for shareholders who hold more than 10% of insider shares in accordance with the Securities and Exchange Act, their shareholdings include their own shares plus the shares they hold in trust and have the right to decide the use of the trust property, etc. Please refer to the Market Observation Post System for information on insider shareholdings.

• 50 -

Wan Hwa Enterprise Company Ltd.

Financial assets measured at fair value through profit or loss - detail table on the current account December 31, 2021

Detail table I

Units: except for unit price which is in New Taiwan Dollar, the rest is in thousand of New Taiwan Dollars.

Names of the financial instruments Prudential Financial Money Market Fund SinoPac TWD Money Market Fund Total	Number of shares or units (Thousands of shares/Thous ands of units) 3,557 3,890	Acquisition costs $ 50,000 47,842 $ 97,842	Fair value	Fair value	Fair value
			Unit price (dollar) 15.9916 14.0472	Total amount
					$ 56,886 54,645 $ 111,531

• 51 -

Unit: NTD thousand

Wan Hwa Enterprise Company Ltd.

Financial assets measured at fair value through other comprehensive income - detail table of the non-current changes

2021

Detail table II

Name Listed (over-the-counter) equities First Hotel Company Ltd. Capital Securities Corp. Mega Financial Holding Co., Ltd. Taishin Financial Holdings Co., Ltd Chunghwa Telecom Co., Ltd Not-listed (over-the-counter) equities Today's Department Store Company Ltd. Dah Chung Bills Finance Corp Kubo Investment Corporation Forward Time International, Ltd Mandarin Investment Corporation Total	Balance at the beginning of the year Numbers of shares (in thousands) Fairvalue 99,001 $ 1,390,957 9,907 134,238 50 1,484 20 259 1 62 1,527,674 5,082 496,699 33,248 238,193 1,985 218,412 1,962 98,933 377 22,697 1,074,934 $ 2,601,934	Balance at the beginning of the year Numbers of shares (in thousands) Fairvalue 99,001 $ 1,390,957 9,907 134,238 50 1,484 20 259 1 62 1,527,674 5,082 496,699 33,248 238,193 1,985 218,412 1,962 98,933 377 22,697 1,074,934 $ 2,601,934	Increase during the year (Note 1) Numbers of shares (in thousands) Amount - $ 34,650 - 33,683 - 287 - 128 - 4 68,752 - 49,254 - - - - - 3,050 - 690 52,994 $ 121,746	Increase during the year (Note 1) Numbers of shares (in thousands) Amount - $ 34,650 - 33,683 - 287 - 128 - 4 68,752 - 49,254 - - - - - 3,050 - 690 52,994 $ 121,746	Decrease during the year (Note 1) Numbers of shares (in thousands) Amount - - - - - - - - - - - - - - 15,878 - 2,137 - - - - 18,015 $ 18,015	Decrease during the year (Note 1) Numbers of shares (in thousands) Amount - - - - - - - - - - - - - - 15,878 - 2,137 - - - - 18,015 $ 18,015	Balance at the beginning of the year Numbers of shares (in thousands) Fairvalue 99,001 $ 1,425,607 9,907 167,921 50 1,771 20 387 1 66 1,595,752 5,082 545,653 34,084 222,315 1,985 216,275 1,962 101,983 377 23,387 1,109,913 $ 2,705,665	Balance at the beginning of the year Numbers of shares (in thousands) Fairvalue 99,001 $ 1,425,607 9,907 167,921 50 1,771 20 387 1 66 1,595,752 5,082 545,653 34,084 222,315 1,985 216,275 1,962 101,983 377 23,387 1,109,913 $ 2,705,665	Provision of guarantees or pledges (Note2)	Remarks
	Numbers of shares (in thousands) 99,001 9,907 50 20 1 5,082 33,248 1,985 1,962 377		Numbers of shares (in thousands) - - - - - - - - - -		Numbers of shares (in thousands) - - - - - - - - - -		Numbers of shares (in thousands) 99,001 9,907 50 20 1 5,082 34,084 1,985 1,962 377

Note 1: The change in the current year's amount is a valuation adjustment based on the fair value measurement. Note 2: None of the pledges were provided as collaterals.

• 52 -

Wan Hwa Enterprise Company Ltd.

Detail table of changes in investments accounted for by the equity method

2021

Detail table III Name Today's Hotel Corporation and Subsidiaries Wan Hwa International Investment Company Ltd. Total	Balance at the beginning of the year Numbers of shares (in thousands) Amount 10,200 $ 2,591,004 497 266,132 $ 2,857,136	Balance at the beginning of the year Numbers of shares (in thousands) Amount 10,200 $ 2,591,004 497 266,132 $ 2,857,136	Increase duringtheyear Numbers of shares (in thousands) Amount - $ - - - $ -	Increase duringtheyear Numbers of shares (in thousands) Amount - $ - - - $ -	Decrease duringtheyear Numbers of shares (in thousands) Amount (Note 2) - $ 71,828 - 7,459 $ 79,287	Decrease duringtheyear Numbers of shares (in thousands) Amount (Note 2) - $ 71,828 - 7,459 $ 79,287	Profit or loss in investment ( $ 81,102 ) 1,462 ($ 82,564)	Balance at the beginningof	Balance at the beginningof	Balance at the beginningof	theyear Amount $ 2,438,074 257,211 $ 2,695,285	Market value or net equity (Note 3) Unitprice Total amount $ 2,438,074 257,211 $ 2,695,285	Market value or net equity (Note 3) Unitprice Total amount $ 2,438,074 257,211 $ 2,695,285	Unit: NTD thousand Provision of guarantees or pledges (Note 4) Remarks Note 1 Note 1	Unit: NTD thousand Provision of guarantees or pledges (Note 4) Remarks Note 1 Note 1
								Numbers of shares (in thousands) 10,200 497	Shares Ratio (%) 30.36 49.87
	Numbers of shares (in thousands) 10,200 497		Numbers of shares (in thousands) - -		Numbers of shares (in thousands) - -							Unitprice
															Note 1 Note 1

Note 1: Recognized on the basis of the financial statements audited by the accountants for the year 2020. Note 2: The decrease in the current year is due to the recognition of translation differences on the financial statements of foreign operating companies. Note 3: The net equity in the investees was calculated based on the financial statements of the investees and the Company's percentage of ownership. Note 4: None of the pledges were provided as collaterals.

• 53 -

Wan Hwa Enterprise Company Ltd. Other payables detail table December 31, 2021 Detail table IV Item Dividends Employees’ remuneration and compensation and Directors’ compensation Others (Note) Total	Unit: NTD thousand Amount $ 105,596 8,884 5,362 $ 122,851

Note: The balance of each item did not exceed 5% of the balance of this category.

• 54 -

Wan Hwa Enterprise Company Ltd.

Deposits received detail table

December 31, 2021

Detail table V Unit: NTD thousand

Name of the customers Formosa International Hotels Green World Hotels Showtime Cinemas Inc. Flower Lounge Restaurant Eslite Spectrum Corporation Others (Note)		Amount
		$ 33,980 32,759 12,000 10,948 10,100 7,479 $ 107,266

Note: The balance of each item did not exceed 5% of the balance of this category.

• 55 -

Wan Hwa Enterprise Company Ltd.

Details table of the operating income

2021

2021
Detail table VI Item Rental income Income from rent Income from maintenance Education and entertainment Income from theater ticket sales Income from the arcade centers Income from advertisement Total	Unit: NTD thousand Amount $ 155,360 10,048 165,408 65,649 8,021 858 74,528 $ 239,936

• 56 -

Wan Hwa Enterprise Company Ltd.

Operating cost breakdown detail table

2021

		2021
Detail table VII Name Tax donation Depreciation Cleaning and sanitation service fee Maintenance fee Utility bill Performance fee Rental expenses for arcade centers Others (Note)		Rental cost $ 18,698 5,962 2,823 2,763 1,841 - - 868 $ 32,955	Unit: NTD thousand Education and entertainment cost Total $ 1,936 $ 20,634 484 6,446 378 3,201 260 3,023 311 2,152 49,961 49,961 5,528 5,528 188 1,056 $ 60,734 $ 92,001
					$ 20,634 6,446 3,201 3,023 2,152 49,961 5,528 1,056 $ 92,001

• 57 -

Wan Hwa Enterprise Company Ltd.

Operating Expense detail table

2021

2021
Detail table VIII Item Wages Miscellaneous expenses Tax donation Labor costs Others (Note) Total	Unit: NTD thousand Amount $ 13,364 8,797 2,594 2,325 2,230 $ 29,310

Note: The balance of each item did not exceed 5% of the balance of this category.

• 58 -

Wan Hwa Enterprise Company Ltd.

Table of employee benefits, depreciation and amortization expenses

2021 and 2020

Detail table IX

Unit: NTD thousand

Employee benefit expense Salary expenses Labor and health insurance expenses Pension scheme expenses Remuneration Paid to Directors Others Depreciation expense				2021		Total $ 9,411 930 542 2,920 1,000 $ 14,803 $ 6,867				2020
		Under operating costs $ 1,597 112 - - - $ 1,439 $ 6,446		Under operating expenses $ 8,084 818 542 2,920 1,000 $ 13,364 $ 421				Under operating costs $ 1,597 107 - - - $ 1,704 $ 8,000		Under operating expenses $ 8,573 801 558 3,720 1,000 $ 14,468 $ 520		Total
												$ 9,986 908 558 3,720 1,000 $ 16,172 $ 8,520

1. The average number of employees for both 2021 and 2020 was 22 and 25, of which the three directors were not also employees.

2. The average employee benefit expenses were $625 thousand and $566 thousand for 2021 and 2020, respectively.

3. The average employee’s compensation was $495 thousand and $454 thousand for 2021 and 2020, respectively. Change in Average Employee Salary Expense is 9.0%.

4. The performance evaluation and salary compensation of Directors and Managerial Officer are submitted to the Compensation Committee for discussion and resolution of the Board of Directors based on their individual performance and the Company's operating results for the current year. The remuneration of employees is based on the salary scale of the Company's employees and submitted to the Compensation Committee for discussion and resolution by the Board of Directors.

5. 59 -