WEC - Annual Report 2022 | FinancialReports.eu

TSE: 2344

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Winbond Electronics Corp.
2022 Annual Report
Printed on March 16, 2023
Taiwan Stock Exchange Market Observation Post System:
https: //mops.twse.com.tw
Winbond Website: https: //www.winbond.com
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1. Spokesperson

Chih-Chung Chou CFO, Finance Center Tel: 886-3-567-8168 E-mail: [email protected]

2. Deputy Spokesperson

Hsiang-Yun Fan Vice President, DRAM Product Business Group Tel: 886-3-567-8168

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E-mail: [email protected] Yen-Chieh Tai Financial Director, Finance Division Tel: 886-3-567-8168 E-mail: [email protected]

3. Company Address and Telephone

Headquarters and CTSP Fab:

No. 8, Keya 1st Rd., Daya Dist., Central Taiwan Science Park, Taichung City 428303, Taiwan Tel: 886-4-2521-8168

Kaohsiung Fab:

No. 35, Luke 5th Rd., Kaohsiung Science Park, Luzhu Dist., Kaohsiung City 821011, Taiwan Tel: 886-7-6278168

Zhubei Building: No.539, Sec. 2, Wenxing Rd., Zhubei City, Hsinchu County 302052, Taiwan Tel: 886-3-5678168

Taipei Office: 2F, No.192, Jingye 1st Rd., Zhongshan Dist., Taipei City 104051, Taiwan 26F, No.1, Songzhi Rd., Xinyi Dist., Taipei City 110411, Taiwan Tel: 886-2-8177-7168

4. Common Stock Transfer Office

Stock Registrar and Transfer Office, Winbond Electronics Corporation 8F, No.398, Xingshan Rd., Neihu Dist., Taipei City 114057, Taiwan Tel: 886-2-2790-5885

Website: https://stock.walsin.com

5. Auditor

Deloitte & Touche Kenny Hung and Wen-Yea Shyu 20F, No. 100, Songren Rd., Xinyi Dist., Taipei City 110016, Taiwan Tel: 886-2-2725-9988

Website: https://www.deloitte.com.tw

6. Foreign securities listing: N/A

7. Company Website: https://www.winbond.com

A Letter to Our Shareholders ........................................................................................................... 1
Company Profile .............................................................................................................................. 4
Corporate Governance
I. Organization ...................................................................................................................................... 5
II. Profile of the Directors, President, Vice Presidents, Assistant Vice Presidents, and
Department and Branch Managers .................................................................................................. 7
III. Remuneration paid to Company Directors, Supervisors, President, and Vice Presidents in
the most recent year ....................................................................................................................... 18
IV. Corporate Governance Status ......................................................................................................... 22
V. Certified public accountant’s fee information ................................................................................ 43
VI. Change of accountant ..................................................................................................................... 43
VII. Chairperson, president, or manager in charge of financial or accounting matters who
worked in the firm of the certified public accountant’s firm or its affiliates in the past year ....... 43
VIII. Changes in the shareholding of directors, managers, and shareholders holding more than
10% of the shares and pledged shares in the past year as of the publication date of the
annual report .................................................................................................................................. 43
IX. Information on the top ten shareholders who are related to each other or are spouses or
second-degree relatives .................................................................................................................. 44
X. Consolidated shareholding percentage .......................................................................................... 46
Fundraising Status
I. Capital and Shares ........................................................................................................................... 47
II. Issuance of corporate bonds ........................................................................................................... 51
III. Issuance of Preferred stock ............................................................................................................. 51
IV. Issuance of Depository Receipt ....................................................................................................... 51
V. Status of Employee stock option plan ............................................................................................ 51
VI. Status of Employee restricted stocks .............................................................................................. 51
VII. Status of issuance of new shares in connection with Mergers and Acquisitions ........................... 51
VIII. Status of implementation of the capital utilization plan ................................................................ 51
Business Overview
I. Description of Business ................................................................................................................... 52
II. Market, Production, and Sales ........................................................................................................ 57
III. Employees ....................................................................................................................................... 61
IV. Information on Environmental Protection Expenditure ................................................................. 61

V. Labor relations ................................................................................................................................ 62 VI. Cybersecurity Management ............................................................................................................ 65 VII. Important Contracts ........................................................................................................................ 66 VIII. Material impact on the company’s financial situation of financial difficulties experienced by the company and its affiliates in the most recent fiscal year or during the current fiscal year up to the date of publication of the annual report ........................................................................ 70

Financial Overview

I.	Condensed balance sheets, statements of income, names of CPAs, and audit opinions for
	the last 5 years ................................................................................................................................ 71
II.	Financial analysis of the last 5 years ............................................................................................... 73
III.	Report of the Audit Committee on the 2022 Financial Report ...................................................... 75
IV.	2022 Consolidated Financial Statements ........................................................................................ 76
V.	2022 Standalone Financial Statements ......................................................................................... 156
Analysis of Financial Status and Financial Performance and Risk Issues
I.	Financial status .............................................................................................................................. 224
II.	Financial performance .................................................................................................................. 224
III.	Cash flow ....................................................................................................................................... 225
IV.	Impact of major capital expenditures in the most recent fiscal year on financial operations ..... 225
V.	Reinvestment policy for the most recent fiscal year, main reasons for profits/losses
	generated thereby, improvement plans, and investment plans for the coming year ................. 226
VI.	Risk analysis and assessment ........................................................................................................ 226
VII.	Other matters of importance ........................................................................................................ 229
Important Notice
I.	Profiles of affiliates and subsidiaries ............................................................................................ 230
II.	Private placements ....................................................................................................................... 237
III.	Holding or disposal of Company stocks by subsidiaries in the past year and up to the date of
	report ............................................................................................................................................ 237
IV.	Other necessary supplemental information ................................................................................. 237
V.	Corporate events with material impact on shareholders' equity or stock prices in the past
	year and up to the date of report, as outlined in Subparagraph 2, Paragraph 3, Article 36 of
	the Securities and Exchange Act ................................................................................................... 237

A Letter to Our Shareholders

Dear Shareholders,

Central banks around the world have raised interest rates to curb inflation arising from conflicts between Ukraine and Russia, rising energy prices, and China’s zero COVID policy in 2022. Tightened fiscal policies have significantly slowed manufacturing activity, weakened global stock and bond market performance, and signaled a clear trend toward an economic downturn. For Winbond, operations in the first half of the year remained at peak levels thanks to the flow of electronic products and remote business opportunities presented by the pandemic. In the latter half of 2022, however, business growth has been hampered by diminished demand for consumer electronics, alleviated material shortages, and the accumulated inventory stemming from supply chain imbalances during the pandemic. Nevertheless, with the easing of the pandemic, the pace of innovation-driven operations in the electronic and electrical manufacturing industries is expected to slowly but gradually pick up pace. We are confident that we can overcome the challenges of the current global economic and political situation as well as continue to work closely with our partners on total memory solutions, ultimately reaching the goal of stability and growth.

Financial Performance

In 2022, our consolidated revenue amounted to NT$94.53 billion, a decrease of 5.06% compared to 2021, mainly due to the impact of inventory adjustments and weakened demand for consumer electronics. Memory and logic products constituted 56% and 44% of consolidated revenue respectively. The gross margin was 46% and the operating margin was 17%. Our net earnings after tax were NT$15.0 billion (NT$12.9 billion attributed to the parent company) while earnings per share were NT$3.25.

Market and Product Applications

Winbond’s memory business is dedicated to the design, fabrication, and distribution of Code Storage Flash Memory and Specialty DRAM. The two product lines are the cornerstones of the Company’s robust operation. Our logic IC business provides eight major solutions—microcontroller applications, smart home, cloud security, motion sensing technologies, battery monitoring, IoT applications, semiconductor components, and IC foundry, and we are always seeking to expand its product lineup to give our clients the most comprehensive service possible.

In terms of product application, Winbond’s memory IC products are balanced across the four major sectors of electronics. In 2022, the communication applications product line remains the major revenue source of our memory business, accounting for 29% of its total revenue. Automotive and industrial products were unaffected by the economic downturn in the second half of the year, accounting for 27% of our total revenue, with uninterrupted growth thanks to the growing adoption of electric vehicles and the advancement of smart technologies. Attributable to a wave of replacements due to software upgrades, computing and peripheral products generated 24% of our total revenue, with only 20% on consumer products as less was spent on electronics during the post-pandemic period. Our automotive applications also showed significant growth, accounting for 40% of our logic IC revenue. Communications and consumer products revenue were at 22% each, on par with the previous year. Although the smartphone market weakened, sales of our CSP MOSFETs for lithium-ion mobile battery protection performed well, which continue to increase our market share and help maintain our momentum. Revenue from computing and peripheral products and applications decreased slightly to 16%.

Capacity Planning

Winbond’s Kaohsiung Fab has commenced operations according to plan with a capacity of 10,000 wafers per month expected to go toward our 2023 revenue. Our latest DRAM 25 Snm technology will provide 2G/4G DDR3 and other higher-end niche products to meet the specs for IoT, smart systems, automotive, industrial, and metaverse applications. Facilities will continue to be built in Kaohsiung Fab 1 based on market and business prospects.

The CTSP Fab in Central Taiwan Science Park is currently producing 58,000 wafers per month while catering to Code Storage Flash Memory and Specialty DRAM product lines. With the Kaohsiung Fab now having Specialty DRAM capacity, we will be able to progressively increase our Code Storage Flash Memory fabrication at the CTSP Fab, thus maintaining our leading position in the market.

Product Innovation and Technology Development

To bolster our competitive advantage, Winbond is proactively incorporating green design thinking into the core product design process. We have completed verification of using flash memory in low-temperature soldering (LTS) processes that

conform with Joint Electron Device Engineering Council (JEDEC) standards, which effectively reduces our carbon footprint. The process flow for surface mount technology has been streamlined and shortened to reduce production costs. Vigorous growth of the Internet of Vehicles has highlighted network security risks and the rising significance of information security functions for vehicular systems and software. In 2022, Winbond became the world’s first memory manufacturer to match international industry standards with ISO/SAE 21434 Road Vehicles—Cybersecurity Engineering certification.

A multitude of resources have been invested in our logic IC business, developing various types of products that are in demand. For automotive products, we are developing novel Human-Machine Interface solutions with vehicular communication security technology that supports quick startup and high-resolution displays. We verified our battery deterioration diagnosis technology in collaboration with international manufacturers to build a circular ecosystem for recycling automotive batteries. For industrial control systems, Winbond launched the first MA35D1 series microprocessor based on the dual-core 64-bit Arm® Cortex®-A35 and single-core Cortex®-M4 architectures to target the need for high-performance edge computing in industrial IoT. On top of breakthroughs in computing, communications, and consumer products, we are always looking to bring new products and applications to the market.

For the development of in-house memory technologies, our latest DRAM 25 Snm technology has been put into production as the main line of the Kaohsiung Fab. The development of next-generation DRAM 20 nm processes is on schedule and projected to enter production in the second half of 2023, providing yet another solid foundation and driving force for our long-term growth. Regarding flash processes, Winbond is developing NOR Flash 45 nm and NAND Flash 24 nm processes in response to future market demand for high-capacity memory. Our goal is to increase the technological competitive edges of both Winbond and our clients by strengthening core technologies and value-added products.

Corporate Sustainability

Winbond established the Sustainability Development Committee (ESG Committee) in May, which is directly supervised by the Board of Directors and headed by the Chair. In August, we joined the Taiwan Climate Partnership (TCP), a major climate initiative organization, with the Chair serving as director and group convener. In November, Winbond acquired 1,000 tons of CO2e high-quality blue carbon credits from the Singaporean Climate Impact X (CIX), some of which were used to offset carbon emissions for the zero-carbon 35[th] Anniversary ESG Family Day. For green products, we have successfully developed a 1.2V Serial NOR Flash—the first of its kind that supports ultra-low voltage operations which significantly reduce energy consumption.

Winbond gives back to society by serving breakfasts for students and children in rural areas and supporting STSP Charity Month activities aimed at improving the lives and quality of life for economically disadvantaged families. Regarding environmental protection, in 2022, Winbond combined efforts to adopt and maintain the HouFeng Bikeway. To foster interdisciplinary semiconductor talent, Winbond joined hands with National Cheng Kung University to plan and develop the Winbond NCKU Semiconductor Leadership Program.

Winbond’s robust profitability and outstanding performance in sustainability and corporate governance allow us to pass the rigorous review of investment institutions and be selected as a constituent of their investment indices. In 2022, we were included in the FTSE4Good Emerging Index, FTSE4Good TIP Taiwan ESG Index, and TWSE Corporate Governance 100 Index while ranking in the top 6%-20% ranking in the TWSE Corporate Governance Evaluation for multiple years consecutively.

Honors and Awards

In 2022, Winbond received numerous awards for innovation and sustainable development. Our TrustME® W77Q Secure Flash Memory was crowned the winner at the 2022 China OFweek 7th IoT& AI Innovative Technology Product Awards. The product supports secure storage and startup, root of trust, and system recovery, which allows a simple drop-in replacement for existing NOR Flash devices. Furthermore, our HYPERRAM™ 3.0 product was recognized at the 7[th] China IoT Technology Innovation Award in 2022 by Elecfans for its low pin count, low power consumption, and ease of control, which substantially improve the performance of IoT end devices.

The NuMicro® M030G/M031G series microcontrollers launched by our logic IC business with a complete platform solution for optical transceiver applications were named Microcontroller/Interface of the Year at the ASPENCORE World Electronics Achievement Awards (WEAA) and Promising Product of the Year at the 2022 EE Awards Asia: Asian Golden Selection Award.

In terms of sustainable development, Winbond has stayed true to our commitment to corporate governance and environmental sustainability. In 2022, we won three awards at the 2022 Taiwan Corporate Sustainability Awards (TCSA): In addition to once again winning the IT & IC Manufacturing Platinum Award and the Talent Development Leadership Award, we took home our first Top 100 Sustainability Exemplary Taiwanese Company Award. These accomplishments are exemplary

of the recognition by external organizations for our performance and results in striking a balance between corporate sustainability, ESG management, and business resilience.

Future Prospects

The Winbond Group envisions itself as “a hidden champion in the use of sustainable semiconductor technology to enrich human life”, which our business activities, organizational design, talent development, cultural shaping, technology development, as well as product design, manufacturing, and applications, all aligned with. Humanity as a whole is confronting several significant developments: the advent of aging societies, climate change, biodiversity issues, the Internet of Everything and cybersecurity challenges, geopolitical tensions, as well as deglobalization. As a leading provider of electronics technology, we are taking a proactive stance in the game.

The time has come for the creation of a smart future in which technology makes the lives of people—young and old—easier. Smart living involves smart home appliances and the application of AI and robotics. It is high time we used technology to drive energy transition, including the generation, storage, and transfer of green energy, which must be implemented on multiple levels with wide-ranging investments from governments and private sectors alike. We vow to work in concert with our clients, affiliates, and shareholders to strive for this momentous innovation opportunity. As many countries have promulgated laws and regulations to secure and safeguard Internet-accessible systems, we are prepared to satisfy customers’ needs with new products and applications in this regard.

Irrespective of globalization or deglobalization, the next step that businesses like us need to take is localization, which is of particular importance given the shortage of talent caused by the aging population. Global recruitment is key to ensuring our ability to survive and fostering future corporate development. In recent decades, the Winbond Group has stationed over one-third of its employees at multiple overseas R&D bases and locations, and we will continue to ramp up efforts to strengthen the consistency of our working platforms and ensure cultural inclusivity for all employees, at home and abroad. Our ultimate goal is to serve every customer and make them feel at home, no matter where they are in the world.

Finally, on behalf of the management team at Winbond, I would like to express our utmost gratitude to our shareholders, who continue to support and further the growth of the company through such trying times.

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Arthur Yu-Cheng Chiao Chairman and CEO

Company Profile

(I) Company History

Winbond was established in September 1987 and listed on Taiwan Stock Exchange in 1995. Winbond operates 12-inch fabs with high levels of smart technology and automation in Central Taiwan Science Park and Southern Taiwan Science Park, with the company headquarters located in Central Taiwan Science Park (the Kaohsiung Fab began operations in 2022).

Winbond specializes in the production of memory IC. From product design, research and development, and wafer fabrication to the marketing of brand name products, Winbond endeavors to provide its global clients with total memory solutions. Winbond's major product lines include Code Storage Flash Memory, TrustME® Secure Flash Memory, Specialty DRAM and Mobile DRAM. We are the only company in Taiwan with the ability to develop DRAM and flash products inhouse. Our advantages of technological autonomy and prudent capacity strategies enable us to build a highly flexible production system and create synergy among product lines, which allows us to meet the diverse demands of customers while building our brand image. Winbond’s products are used extensively in handheld devices, consumer electronics, and computer peripherals. We also focus on high-barrier, high-quality applications, such as automotive and industrial electronics.

Winbond has set up operations and distributor networks in the USA, Japan, China, Hong Kong, Israel and Germany to serve clients better and expand the depth and breadth of product sales. Winbond is committed to the pursuit of superior quality with zero defects and is certified as compliant with a number of quality and environmental safety management standards. We are also the first memory manufacturer in Taiwan to obtain certification for ISO 26262, which is the highest standard for automotive functional safety, and the ISO/SAE 21434 standard for cybersecurity risk management for road vehicles.

Winbond also always adheres to high standards of corporate governance; we have been evaluated by the Taiwan Stock Exchange as one of the top 20% listed corporate governance. Winbond will continue to provide customer-oriented services and strive towards the goal of becoming an unseen yet essential champion in providing sustainable semiconductors technology to enrich human life by applying the strength of our advanced semiconductor design and manufacturing know-how and incorporating our corporate values—integrity, accountability, curiosity, innovation, and sustainability—into the Company’s business activities.

(II) Major business developments in the past year and up to the date of the report

1.Due to improvements in production efficiency, the 12-inch wafer fabrication plant at Central Taiwan Science Park (CTSP) plans to increase its monthly capacityof 12-inch wafers from 58,000 to 60,000 in 2023.
2.The DRAM 25Snm production process technology has been developed and put into mass production at the Kaohsiung Fab. Good progress is being made on the development of the latest 20nm DRAM production process, which has had a successful trial production run; it is expected to enter mass production at the Kaohsiung Fab in the second half of 2023.
3.We embarked on the Kaohsiung fab construction project in October 2018 and completed construction in 2021. The machinery at the fab has been installed and entered production in 2022. The fab’s monthly capacity will be gradually expanded to 10,000 wafers by 2023 and to 14,000 wafers by 2024. The management team will implement plans to expand the monthly capacity of the Kaohsiung Fab to 20,000 wafers depending on market conditions and customer needs.

(III) Investment in affiliates in the past year and up to the date of the report

For the Company’s investment in affiliated enterprises, please see pages 230–237 of this report.

		ommittee e	ommittee e				e�rement Reserve Funds			Administration Center	Finance Center	Finance Center	Finance Center

	Remuneration Committee			Chairman's Office			Employees’ Welfare Committee Supervisory Commi�ees of Workers' R ESH Committee Patent Committee		DRAM Product Business Group Memory IC Manufacturing Business Group Flash Memory IC Business Group Technology R&D Group
		Auditing Department		Chairman's Office				President's Office
													`5`
Shareholders' Meeting	Board of Directors		irman		EO	sident

		Cha	Cha		C	Pre

										Sales Center	Quality & ESH Center	Production Control and Subcontractor Management Center

2. Major business units and their key operations

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Unit Function
I. Planning and execution of internal audits
Auditing Department
II. Planning and execution of internal control self-assessments
I. Planning and execution of accounting and tax management
II. Planning and evaluation of budget and costs
III. Planning and management of corporate finance; investment management
Finance Center
IV. Investor relations and the planning and execution of stock affairs operations
V. Operations management and planning of public affairs outside of the fabs
VI. Legal and intellectual property (IP) consulting and management
Ensuring secure, efficient, and data-driven operations at the Company:
I. Assisting the Company by spearheading the improvement of its cybersecurity capabilities and
maintaining the confidentiality, integrity, and availability of information systems, identities, and data
II. Providing secure, stable, efficient, and intuitive information technology systems, tools, and application
Information Technology
platforms that meet the Company’s operational needs
Center
III. Developing and using information technology tools and platforms to help colleagues optimize their
productivity and operational performance
IV. Continuous improvement of the Company’s information technology capacity to strengthen its core
competitive advantages
I. In charge of worldwide sales (foundry sales not included)
II. New client development and new product promotion
Sales Center III. Responsible for the attainment of annual sales targets
IV. Management of dealers and distributors
V. Collection of accounts receivable
I. Maintaining the quality management system to ensure product quality and reliability
II. Elevating the quality and professional know-how of employees; continuously improving the quality of
products by improving the quality management system and employee training
Quality & ESH Center III. Responding to customer quality issues and providing solutions
IV. Promotion and management reviews of ESG sustainability operations
V. Implementing effective ESH plans and risk management measures and establishing a work environment
that is in compliance with environmental regulations and international standards
I. Production planning and execution and production-sales coordination
II. Planning and execution of logistics supply
III. Planning and execution of outsourcing capacity and production plans
Production Control and IV. Vendor management and quality control
Subcontractor V. Outsourcing processes and production streamlining
Management Center VI. Import and verification of new IC assembly technologies
VII. Implementation of procurement operations
VIII. Implementation of import/export and bond operations
IX. Raw material inventory management
Memory IC I. Responsible for the manufacturing of DRAM and flash memory, maintaining high quality and low costs
Manufacturing Business II. Servicing foundry customers; providing competitive products
Group III. Reducing carbon emissions during wafer fabrication (energy conservation and carbon reduction)
DRAM Product Business
DRAM product business and operations management
Group
Flash Memory IC Business
Design, development, and marketing of flash memory products
Group
Technology R&D Group Developing memory (DRAM and flash memory) production technologies and improving product quality
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Relationship
Name
Title
Other positions at the
Company or elsewhere
Notes See note 15 N/A N/A N/A N/A N/A N/A -
-
Spouse Relative by marriage N/A Spouse Relative by marriage N/A N/A N/A N/A
March 16, 2023
-
N/A N/A N/A N/A N/A
Yung Chin Wei-Hsin Ma Arthur Yu-Cheng Chiao Wei-Hsin Ma
-
N/A N/A N/A N/A N/A
Officer, director or supervisor who is the person’s spouse or relative within the second degree of kinship Director Director Chair and CEO Director
3 4 5 6 7 8 9 -
See note See note See note See note See note See note See note
Education/Work experience
MS in Electrical Engineering, University of Washington (UW) MRes, UW School of Business Administration Chair of Walsin Lihwa Corp. Chair of Nuvoton Technology Co. CEO of Winbond; (incumbent) Ph.D. in Electrical Engineering, U.C. Berkeley and Master’s in Management Science, Stanford University CEO of BCD Semiconductor President of Winbond Deputy CEO of Winbond; (incumbent) MS in Applied Mathematics, University of Washington BS in Mathematics, National Taiwan University Chief Administrative Officer of Winbond Chair of the Theaceae Conservation Corp.; (incumbent) MBA, National Chengchi University Graduated from the Advanced Management Program, Wharton School of the University of Pennsylvania Chair of Altek Corporation Chair of Taiwan Mask Corporation Chair of Myson Century, Inc. Convener of Winbond’s Audit Committee; (incumbent) Ph. D. in Materials Science, U.C. Berkeley President of WaferTech President of the CVD Department of Applied Materials, Inc. Vice President of Operations and Organization, TSMC Convener of Winbond’s Remuneration Committee; (incumbent) Graduated from the Computer and Control Engineering Department, National Chiao Tung University Chair and CEO of Waffer Technology Corp. (incumbent) Chair of NAFCO (incumbent) MS in International Business, Waseda University, Japan Chairperson and President of AcBel Polytech; (incumbent) -
- - - - - - - -
ding 2ge
Sharehol percenta
- - - - - - - -
name of others
Shares held in the Number of shares
- - - - - -
2
ding ge 0.30% 1.59%
Sharehol percenta
- - - - - -
children
spouse and minor shares 11,778,797 63,472,995
Number of
Shares currently held by
- - - -
2
Sharehol ding percenta ge 1.59% 0.01% 0.30% 22.20%
Shares currently held Number of shares 63,472,995 551,000 11,778,797 - - - - 883,848,423
- - - -
1
Sharehol ding percenta ge 1.59% 0.02% 0.30% 22.20%
shares 63,472,995 901,000 11,778,797 - - - - 883,848,423
Number of
Shares held when elected
Date first elected 1987.09.04 2009.06.19 Note 4 1996.04.09 2014.06.17 2019.06.14 2014.06.17 2014.06.17 1987.09.04
3 3 3 3 3 3 3 3
Tenur e (in years)
Date
appointed 2020.06.12 2020.06.12 2020.06.12 2020.06.12 2020.06.12 2020.06.12 2020.06.12 2020.06.12
M M F M M M M -
Gender and age 60 to 70 years old 60 to 70 years old 60 to 70 years old 60 to 70 years old 70 to 80 years old 70 to 80 years old 40 to 50 years old
Name Arthur Yu- Cheng Chiao Tung-Yi Chan Yung Chin Allen Hsu Stephe n T. Tso Francis Tsai Jerry Hsu Walsin Lihwa Corp.
Nation ality or place of registr ation R.O.C. R.O.C. R.O.C. R.O.C. R.O.C. R.O.C. R.O.C. R.O.C.
Corpora tion
1. Directors (1) Title
Chair Vice Chair Director Independent Director Independent Director Independent Director Independent Director Director
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Nation Shares held when elected Shares currently held Shares currently held by spouse and minor children Shares held in the name of others Other Comp Officer, director or supervisor who is the person’s spouse or relative within the second degree of kinship	Title ality or place of registr ation Name Gender and age Date appointed Tenur e (in years) Date first elected Education/Work experience positions at the any or elsewhere Notes Number of shares Sharehol ding percenta ge1 Number of shares Sharehol ding percenta ge2 Number of shares Sharehol ding percenta ge2 Number of shares Sharehol ding percenta ge2 Title Name Relationship	Represe ntative R.O.C. Fred Pan M 60 to 70 years old 2020.06.12 3 2020.06.12 - - - - - - - - MBA, Tulane University CFO of Philips Semiconductors Asia Pacific CFO of the Sales and Marketing Division of Philips Semiconductors Taiwan President of Walsin Lihwa; (incumbent) See note 10 N/A N/A N/A N/A	Director Corpora tion R.O.C. Chin Xin Investm ent Corp. - 2020.06.12 3 103.06.17 Note 11 221,003,072 5.55% 240,003,072 6.03% - - - - - - - - - -	Director Represe ntative R.O.C. Yuan- Mou Su M 60 to 70 years old 2020.06.12 3 2017.06.13 - - 709,279 0.02% - - - - MS in Electrical Engineering, University of Southern California BS in Electronics Engineering, National Chiao Tung University Vice Chair and Deputy CEO of Winbond Chair and CEO of Nuvoton Technology Corp; (incumbent) See note 12 N/A N/A N/A N/A	Director R.O.C. Chih- Chen Lin M 40 to 50 years old 2020.06.12 3 2017.06.13 - - - - - - - - MBA, Stern School of Business, New York University BS in Chemical Engineering, National Taiwan University President of Taiwan Mobile Corporation Ltd.; (incumbent) See note 13 N/A N/A N/A N/A	N/A	Notes: 1. "Shareholding percentage when appointed" is based on the number of common shares outstanding (3,980,000,193 shares) as of the period of the person’s appointment. 2. "Shareholding percentage" is based on the number of common shares outstanding (3,980,000,193 shares) as of March 16, 2023. 3. Serves concurrently as the Chair of Chin Xin Investment Corp. and Cheng He Investment Corp. Serves concurrently as a Director of Walsin Lihwa Corp., Walsin Technology Corporation, MiTAC Holdings Corporation, United Industrial Gases Co., Ltd., Kolin Cons. & Development Co., Ltd. Serves concurrently as an Independent Director of Taiwan Cement Corp. and the Convener of its Remuneration Committee. For more information regarding other positions held in other Winbond subsidiaries, please refer to the “Profiles of affiliates and subsidiaries” section on pages 230-237 of this report. 4. Vice Chair Tung-Yi Chan served as a Director of Winbond from June 19, 2009, to June 12, 2017, and is serving concurrently as a Director of Walton Advanced Engineering, Inc. For more information regarding other positions held in other Winbond subsidiaries, please refer to the “Profiles of affiliates and subsidiaries” section on pages 230-237 of this report. 5. Serves concurrently as a Supervisor of Qing An Investment Limited, Yau Cheung Investment Limited, and Cheng He Investment Corp. For more information regarding other positions held in other Winbond subsidiaries, please refer to the “Profiles of affiliates and subsidiaries” section on pages 230-237 of this report. 6. Serves concurrently as the Chair of Yizhong Technology Inc., Unus Tech Co., Ltd., You Yuan Investment Ltd., and Pao Yueh Investment Ltd. Serves concurrently as an Independent Director of Nuvoton Technology Co; serves concurrently as a Director of Innodisk Corporation and ACME Electronics Corporation. 7. Serves as an Independent Director of AOPEN Inc. 8. Serves concurrently as the Chair of Getac Holdings Corporation. 9. Serves concurrently as the Chair of AcBel Polytech (Dongguan), AcBel Polytech (Wuhan), Acbel (USA) Polytech Inc., Acbel Polytech (Philippines) Inc., and Huhua Hardware Electron (Wujiang) Co., Ltd. Serves concurrently as an Executive Director of Huhua Hardware Electron Co., Ltd. in Tongliang District, Chongqing City, and Chongqing Kanghwa Metal Products Inc. Serves concurrently as vice chair of Cal-Comp Electronics (Thailand) Ltd.; Serves concurrently as a Director of Kinpo Electronics, Inc., Lippo Big Data, Eslite Life, AcBel Polytech(SAMOA)Investment Inc., Acbel Polytech (Singapore) Pte Ltd., Acbel Polytech (UK) Limited, AcBel Polytech Japan Inc., Power Station Holdings Ltd., Compal Electronics Inc., Castle Net Technology Inc., Acbel Polytech Holdings Inc., Acbel Polytech (Ireland) Limited, AcBel Polytech International Inc., Kang De Energy Inc., Kang Rei Energy Inc., CK Holdings Inc., LIZ Electronics (Nantong) Ltd., Reber Biomedical Ltd., Ray-Kwong Medical Management Consulting Co., CSA Holdings Inc., QBit Semiconductor Holding LTD., Target Gain Corporation, Melvita Taiwan Co., Ltd., ARCE Therapeutics Inc., Cal-Comp Electronics & Communications Co., Ltd., Kangjan Power Co., Ltd., Qbit Semiconductor Ltd., New Era AI Robotic Inc., NKG Advanced Intelligence & Technology Development (Yueyang) Co., Ltd., Cal-Comp Precision (Malaysia) SDN.BHD., Cal-Comp Electronics (USA) Co., Ltd., Cal-Comp USA (San Diego), Inc., Cal-Comp Holding (Brazil) S.A., Cal-Comp Industria de Semicondutores S.A., Kinpo & Compal Group Assets Development Corporation, and VesCir Ltd. Serves concurrently as a Supervisor of Teleport Access Services Inc., Fu Bao Investment Inc., and Kinpo Group Management Service Company. Serves concurrently as the President of AcBel Polytech (Dongguan) Inc., AcBel (USA) Polytech Inc., AcBel Polytech (Philippines) Inc. AcBel Polytech (Wuhan) Inc., and Kinpo & Compal Group Assets Development Corporation. Serves concurrently as the Chief Strategy Officer of Cal-Comp Electronics & Communications Co., Ltd. Serves concurrently as a Deputy Chair of Taiwan Electrical and Electronic Manufacturers' Association (TEEMA), a Director of the Importers & Exporters Association of Taipei, and a member of the Third Wednesday Club-Young Entrepreneur Group.
						Relative by marriage Relative by marriage
						Arthur Yu-Cheng Chiao Yung Chin
						Chair and CEO Director
						See note 14
						Ph. D., School of Humanities, Tsinghua University Executive MBA, Peking University Graduated from the Department of East Asian Languages, U.C. Berkeley Chairperson of HannsTouch Solution Inc.; (incumbent)
						-
						-
						0.57%
						22,859,166
						-
						-
						-
						-
						2017.06.13
						3
						2020.06.12
						F 50 to 60 years old
						Wei- Hsin Ma
						R.O.C.
						Director

10. Serves concurrently as the Vice Chair of Walsin (Nanjing) Development Ltd. Serves concurrently as a Director of Nanjing Walsin Property Management Ltd., Walsin International Investment Ltd., and Joint Success Enterprises Limited. Serves concurrently as a Director and the President of Kolin Cons. & Development Co., Ltd. and Walsin (China) Investment Ltd. 11. Chin Xin Investment Corp. served as a Supervisor of Winbond from June 17, 2014, to June 12, 2017. 12. For more information regarding other positions held in other Winbond subsidiaries, please refer to the “Profiles of affiliates and subsidiaries” section on pages 230-237 of this report. 13. Serves concurrently as the Chair of AppWorks Ventures Co., Ltd., AppWorks Fund IV(TW) Admin Co., Ltd., AppWorks Fund II Co., Ltd., AppWorks Fund III Co., Ltd., AppWorks School Co., Ltd., Chen Fong Investment Co., Ltd., Chen Yun Investment Co., Ltd., Chen Men Investment Co., Ltd., Fu Sheng Digital Co., Ltd., Taiwan Teleservices & Technologies Co., Ltd., Taiwan MyVideo Co., Ltd., Taiwan Stampede Franchise Film Co., Ltd., Taiwan Digital Service Co., Ltd., Fu Shu Lin Media Technologies Co., Ltd., Fu Tien Hsia Media Technologies Co., Ltd., Win TV Broadcasting Co., Ltd., Taiwan Kuro Times Co., Ltd., Yeong Jia Leh Cable TV Co., Ltd., Phoenix Cable TV Co., Ltd., Union Cable TV Co., Ltd., and GlobalView Cable TV Co., Ltd. Serves concurrently as director of AppWorks Ventures II Limited, AppWorks Ventures III Limited, AppWorks IV Limited, AppWorks Fund IV Admin Global Limited, AWTH, 91APP, Inc., Dcard Holdings Ltd., EZTable, Ltd., VIV3 Inc., WeMo (Cayman) Corp., LINE Bank Taiwan Ltd., Taiwan Mobile Co., Ltd., Bridge Mobile Pte Ltd., Taiwan Cellular Co., Ltd., Wealth Media Technology Co., Ltd., Taipei New Horizon Co., Ltd., Taihsin Property Insurance Agent Co., Ltd., TFN Media Co., Ltd., and Fubon Multimedia Technology Co., Ltd. Serves concurrently as president of Taiwan Mobile Co., Ltd., Taiwan Mobile Venture Co., Ltd., Taiwan Cellular Co., Ltd., Taiwan Stampede Franchise Film Co., Ltd., Wealth Media Technology Co., Ltd., Taiwan Fixed Network Co., Ltd., Tai Shin Joint Investment Co., Ltd., TFN Media Co., Ltd., Fu Shu Lin Media Technology Co., Ltd., Fu Tien Hsia Media Technology Co., Ltd., Taiwan Internet Investment Co., Ltd., and TFN Venture Capital Co., Ltd. 14. Servs concurrently as the Chair of Jinpingguo Investment Corp., Yin Wang Investment Co., Ltd., and Huo Chu Investment Corp. Serves concurrently as a Director of HannStar Display Corporation, Walsin Lihwa Corp., United Integrated Services Co., Ltd., Glorystones Inc., and Hanns Blegrain Ltd. Serves concurrently as a Supervisor of Pottery Inc. 15. The purpose of having the same person serve concurrently as both Chair and CEO of the Company is to have this individual lead the management team in efficiently executing the board's decisions. With the aforesaid practice in place, the number of independent directors on the board of the company is increased from the statutory requirement of 3 to 4, with more than half of the board positions filled by individuals who are not managers of the Company. 16. The Directors of this Company are the major shareholders of the institutional shareholder. March 16, 2023	Name of institutional shareholder Major shareholders	Walsin Lihwa Corporation Winbond Electronics Corporation (6.63%), Chin Xin Investment Corp. (6.63%), LGT Bank (Singapore) Ltd. Investment Fund held by the Standard Chartered Bank (Taiwan), Main Branch (6.38%), TECO (5.64%), Rong Chiang International Ltd. (4.92%), Yu-Hwei Chiao (2.92%), Oriental Consortium Investment Limited (2.87%), Yu-Heng Chiao (1.75%), Pai-Yung Hong (1.39%), and Yu-Chi Chiao (1.38%).	Winbond Electronics Corporation (37.69%), Walsin Lihwa Corporation (36.99%), Oriental Consortium Investment Limited (4.43%), Yu-Cheng Chiao (3.14%), Yu-Lon Chiao (3.14%), Yu-Heng Chiao (3.14%), Yu-Chi Chiao (3.14%), Walsin Technology Corporation (1.86%), HannStar Board Corporation (1.34%), and Prosperity Dielectrics Co., Ltd. (0.72%).	onal investors listed as major shareholders in the table above:	Major shareholders	Walsin Lihwa Corp. (22.20%), Chin Xin Investment Corp. (6.03%), Yu-Cheng Chiao (1.59%), Vanguard Emerging Markets Stock Index Fund held by JP Morgan Chase Bank, N.A., Taipei Branch (1.05%), LGT Bank (Singapore) Ltd. Investment Fund held by the Standard Chartered Bank (Taiwan), Main Branch (1.04%), Pai-Yung Hong (0.97%), Vanguard Total International Stock Index Fund, a series of Vanguard Star Funds held by JPMorgan Chase Bank, N.A., Taipei Branch (0.96%), Yu-Heng Chiao (0.75%), iShares MSCI Taiwan Index ETF Investment Fund held by the Standard Chartered Bank (Taiwan), Main Branch (0.69%), and Yu-Lon Chiao (0.65%).	See Note 16	PJ Asset Management Co., Ltd. (17.45%), Walsin Lihwa Corp. (10.81%), Land Union Investment Limited (6.34%), Creative Sensor Inc. (2.87%), He Yuan Investment Co., Ltd. (2.36 %), Tung Kuang Investment Co., Ltd. (1.50%), Norges Bank Investment Fund held by Citibank (Taiwan) (1.45%), Vanguard Emerging Markets Stock Index Fund held by JPMorgan Chase Bank, N.A., Taipei Branch (1.30%) , Guang Yuan Enterprise Co., Ltd. (1.25%), and a series of Vanguard Star Funds held by JPMorgan Chase Bank, N.A., Taipei Branch (1.21%).	Tian Jiang Co., Ltd. (69.67%), Wonderful Assets Co., Ltd. (30.33%)	HannStar Display Corporation (100%)	See note 16	Walsin Lihwa Corp. (18.30%), HannStar Board Corporation (7.65%), Global Brands Manufacture Ltd. (3.30%), Walton Advanced Engineering, Inc. (2.74%), Yu-Heng Chiao (2.65%), Citi Hosting Maybank King Eng Securities Customer Investment Fund (2.61%), Winbond Electronics Corporation (1.72%), Giga Investment Co. (1.37%), Vanguard Emerging Markets Fund Investment Fund held by JPMorgan Chase Bank, N.A. (1.37%), Vanguard Total International Stock Index Fund of the Vanguard Star Fund held by JPMorgan Chase Bank, N.A. (1.35%)	Walsin Technology Corporation (20.32%), Walsin Lihwa Corp. (12.06%), Career Technology (Mfg.) Co., Ltd. (5.44%), Chin Xin Investment Corp. (3.55%), Yu-Heng Chiao (2.19%), Pai-Yung Hong (1.86%), Fund of the NP Paribas Wealth Management Bank, Singapore Branch held by HSBC Bank (1.50%), Prosperity Dielectrics Co., Ltd. (1.07%), Tsai Yi Corporation (0.96%), and Yu Yue Corp. (0.89%).	Walsin Technology Corporation (43.13%), Walton Advanced Engineering, Inc. (0.75%), Mercer QIF Mercer Investment First Fund entrusted to the external manager Fiduciary Investment Management Co., Ltd. Investment Fund Account held by the Standard Chartered Bank (Taiwan), Main Branch (0.72%), Yu-Heng Chiao (0.62%), Ta-Ho Maritime Corporation. (0.55%), ABC Taiwan Electronics Corp. (0.47%), Wen-Je Shen (0.44%), Sheng-Chi Liao (0.36%), Zong-Yuan Huang (0.30%), and the Royce Asian Smaller Companies Investment Fund entrusted to the Swiss GAM Investments held by the Standard Chartered Bank (Taiwan), Main Branch (0.15%).
			Chin Xin Investment Corp.		Name of institutional shareholder	Winbond Electronics Corporation	Chin Xin Investment Corp.	TECO	Rong Chiang International Ltd.	Oriental Consortium Investment Limited	Walsin Lihwa Corp.	Walsin Technology Corporation	HannStar Board Corporation	Prosperity Dielectrics Co., Ltd.

Directors (2)

Disclosure of the professional qualifications of Directors and the independence of Independent Directors:

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Number of
Independent
Director
Criteria
Professional qualifications and experience Independence Positions
Name
Held in
Other Public
Companies
Chair Mr. Yu-Cheng Chiao has chaired the Company since 1987 and 1. Chairperson Chiao and Director Yung Chin are 1
Arthur Yu-Cheng currently serves as its CEO. In the past, he has also served in in a marital relationship; he is also related to
Chiao varying capacities in a range of industries and public organizations Director Wei-Hsin Ma through affinity.
and associations. This service includes his tenure as chair of 2. Current CEO of Winbond
Nuvoton Technology Corporation from 2008 to 2019, chair of
Walsin Lihwa Corporation from 1986 to 1994, and chair of the
Taiwan Electrical and Electronic Manufacturers' Association
(TEEMA) from 2007 to 2013. In 2019, Mr. Chiao received the ERSO
Award and was elected as one of the eighth Industrial Technology
Research Institute (ITRI) Laureates.
Vice Chair Mr. Tung-Yi Chan previously served as the president of Winbond Current Vice Chair of Winbond -
Tung-Yi Chan and was promoted to the position of vice CEO in March 2020.
Prior to that, Chan served as senior engineer at Intel, technical
manager at Cypress, technical manager at Siliconix, vice president
of Winbond’s Sales Center, and CEO of BCD Semiconductor,
accumulating 33 years of technical and managerial experience in
this professional field.
Director Ms. Yung Chin chairs the board of Theaceae Conservation Director Yung Chin and Chair Chiao are in a -
Yung Chin Corporation and served as a director at Nuvoton Technology marital relationship; she is also related to Director
Corp. from 2008 to 2022. Chin has served in various positions in Wei-Hsin Ma through affinity.
the Company, including as vice president of the Knowledge and
Information Management unit from 2002 to 2006, chief auditor
in 2001, and vice president of the Finance Center from 1998 to
2000. During her tenure as vice president of the Finance Center,
she was selected as Financial Officer of the Year. Prior to joining
the Company, Chin served as Chief Auditor at Walsin Lihwa
Corporation. She has more than 30 years of professional
experience in the field.
Independent Mr. Allen Hsu chairs the boards of Unus Tech Co., Ltd. and 3R Life In the two years prior to Hsu’s election as 1
Director Sciences Ltd.; he also serves as independent director of Nuvoton Independent Director and during his tenure in
(Convener of the Technology Corp. and director of Innodisk Corporation and ACME this position, the Company verified the internally
Audit Committee) Electronics Corporation. Hsu joined the Yulon Group in and externally disclosed information and found
Allen Hsu September 1989 to serve as special advisor to the group’s chair. that all independence criteria set forth in the
During his tenure at Yulon and until his retirement in 2012, he was Regulations Governing Appointment of
responsible for overseeing the group’s investment operations and Independent Directors and Compliance Matters
also served as vice CEO of Yulon Motor Co., Ltd. and deputy CEO for Public Companies have been met. In
of the Administrative Office. During his tenure, Hsu also served as accordance with his legally conferred powers,
chair of several TWSE/GTSM listed companies whose shares are Hsu has been granted the authority to oversee
held by the Yulon Group, such as Yulon Finance Corporation, the Company’s operations and participate in
Taiwan Mask Corporation, Altek Corporation, Myson Century Inc., major decision-making of the Company during his
and Lisheng Semiconductor. Prior to taking office in the Yulon tenure.
Group, Hsu was active in the financial sector and served at the
US-based Chase Bank and Bankers Trust from 1978 to 1989,
leading their credit investigation, corporate finance, and
investment banking department. Hsu also served as deputy chair
of the Taiwan Venture Capital Association and has had the honor
of being recognized as an outstanding alumnus of National Chiao
Tung University and an outstanding financial executive as well as
being awarded the Mr. Lu Feng-Zhang Memorial Award.
Independent Dr. Stephen T. Tso served as the senior vice president and chief In the two years prior to Tso’s election as 1
Director information officer of information technology, materials Independent Director and during his tenure in
(Convener of the management, and risk management at Taiwan Semiconductor this position, the Company has verified the
Remuneration Manufacturing Company (TSMC) from 2004 up to his retirement internally and externally disclosed information
Committee) in 2018. Tso also held various managerial positions in operational and found that all independence criteria set forth
Stephen T. Tso organizations and subsidiaries—including as chair/CEO of TSMC in the Regulations Governing Appointment of
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Number of
Independent
Director
Criteria
Professional qualifications and experience Independence Positions
Name
Held in
Other Public
Companies
Solid State Lighting Ltd. and TSMC Solar Co., Ltd. from 2014 to Independent Directors and Compliance Matters
2015; general manager of Wafertech LLC. from 2001 to 2005; for Public Companies are met. In accordance with
senior vice president of Operations at TSMC from 1998 to 2001; his legally conferred powers, Tso has been
senior vice president responsible for TSMC's global marketing granted the authority to oversee the Company’s
operations from 1997 to 1998; and vice president of research and operations and participate in major decision-
development and technology development at TSMC from 1996 to making of the Company during his tenure.
1997. Before joining TSMC, Tso served as president of the world's
largest semiconductor supplier, Applied Materials, Inc., where he
was tasked with heading two divisions, the Metal CVD Division
and CVD II-Advanced Technology Division. Dr. Tso was plant
manager and vice president at SGS-Thomson Microelectronics
from 1989 to 1994; before that, Tso served at Texas Instruments.
Independent Mr. Francis Tsai currently serves as chair of Waffer Technology In the two years prior to Tsai’s election as -
Director Corp. and NAFCO and vice chair of Getac Technology Corporation. Independent Director and during his tenure in
Francis Tsai Mr. Tsai has held a variety of positions in the Getac Group—one this position, the Company has verified the
of the top three rugged laptop manufacturers in the world— internally and externally disclosed information
where he acted as chair during several critical junctures for the and found that all independence criteria set forth
group, including Getac Group’s 2007 merger with MiTAC Precision in the Regulations Governing Appointment of
Technology Corp., its 2009 expansion of business to Waffer Independent Directors and Compliance Matters
Technology Corp. (Taiwan's third largest magnesium and for Public Companies have been met. In
aluminum alloy solution provider), and the 2011 acquisition of accordance with his legally conferred powers,
aerospace engine fastener manufacturer NAFCO. During the 80s, Tsai has been granted the authority to oversee
Tsai was engaged in the marketing and sales of Intel the Company’s operations and participate in
microprocessors and minicomputers, and helped drive the major decision-making of the Company during his
computerization of Taiwanese industries. From 1993 onward, he tenure.
served at MiTAC Computing Technology Corp., where he led the
establishment of OEM electronics manufacturing bases in China
and gradually expanded production to include mechanical and
plastic components. Tsai was later promoted to president of
MiTAC in 1999 and also served as chair of Getac Technology
Corporation, Tyan Computer Corporation, and MiTAC Precision
Technology Corp.
Independent Mr. Jerry Hsu serves as chair/president of AcBel Polytech, director In the two years prior to Hsu’s election as -
Director of the Kinpo Group, deputy chair of TEEMA, and director of the Independent Director and during his tenure in
Jerry Hsu Importers & Exporters Association of Taipei. Hsu is well-versed in this position, the Company has verified the
production and sales in the electronics manufacturing industry internally and externally disclosed information
and is also experienced in private equity investment management and found that all independence criteria set forth
and the operation of corporate boards. in the Regulations Governing Appointment of
Independent Directors and Compliance Matters
for Public Companies have been met. In
accordance with his legally conferred powers, Hsu
has been granted the authority to oversee the
Company’s operations and participate in major
decision-making of the Company during his
tenure.
Walsin Lihwa Corp. Mr. Fred Pan was previously appointed to serve as president of Representative of a juristic person -
(Representative: Walsin Lihwa Corp. in 2019 to assist the company’s chair with the
Fred Pan) planning and implementation of corporate operating strategies.
Before joining Walsin Lihwa Corp., Mr. Pan served as CFO of
Philips Semiconductors Asia Pacific and CFO of the sales and
marketing division of Philips Semiconductors Taiwan.
Chin Xin Investment Mr. Yuan-Mou Su has served as chair and CEO of Company Current Chair of a subsidiary of the Company -
Corp. subsidiary Nuvoton Technology Corp. since February 2020. Before
(Representative: this, Su served as vice chair and deputy CEO of Winbond and also
Yuan-Mou Su) previously served the Company in various capacities from 2000 to
2014, including as vice president of the Company’s Sales Center,
vice president of the DRAM Product Business Group, and
assistant vice president of the DRAM Product Marketing Center.
Before joining Winbond, Su served in several US-based
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Criteria Name	Professional qualifications and experience Independence	Professional qualifications and experience Independence	Number of Independent Director Positions Held in Other Public Companies
	companies—AMD, Digital Equipment Corp., Integrated Devices Technology, and Winbic Semiconductor Inc.—where he accumulated over 30 years of technical and managerial experience in thisprofessional field.
Director Jamie Chih-Chen Lin	Mr. Chih-Chen Lin currently serves as president of Taiwan Mobile, chair and partner of AppWorks, and director of Momo Co., Ltd. Lin is committed to boosting the startup ecosystem, and the articles he has published in his blog MR JAMIE since 2009 have inspired millions of readers and aspiring entrepreneurs worldwide. In the same year, Lin founded AppWorks and grew the company to become one of the leading startup accelerators and most active venture capital institutions in Greater Southeast Asia. Before AppWorks, Lin was also behind the founding of several companies in Taipei and New York: he co-founded e-commerce startup company Haku.com, AI enterprise software startup Intumit, travel community startup Sosauce.com, and 3D game production startup Muse Games. Lin actively contributes to society and served as executive director of the Taiwan Internet and E-Commerce Association (TiEA), co-convener of the Asia Silicon Valley Civic Advisory Committee, and member of the Executive Yuan's Digital Nation and Innovative Economic Development Program(DIGI+). Not applicable		-
Director Wei-Hsin Ma	Ms. Wei-Hsin Ma currently serves as chair/CEO of HannsTouch Solution Inc. and chair of Jinpingguo Investment Corp., Yin Wang Investment Co., Ltd., and Huo Chu Investment Corp. She also serves as director of HannStar Display Corp., Walsin Lihwa Corp., United Integrated Services Co., Ltd., Glorystones Inc., and Hanns Blegrain Ltd. Dr. Ma served as chair of HannStar from March 2012 to March 2015 and chaired the board of Yuanta Securities Investment Trust Co.,Ltd. from August 1998 to July2011.	Director Wei-Hsin Ma is related to Chair Chiao and Director Yung Chin through affinity.	-

Note: Winbond has carried out due diligence using search engines to verify that, as of the writing of this report, no appointed board member is in violation of the provisions of Article 30 of the Company Act .

Directors (3)

Board diversity:

The board member diversity policy stated in Article 20 of the Company's corporate governance principles is as follows: The Company's Board of Directors reports to the Shareholders' Meeting. Operations and arrangements under the Company's corporate governance policy shall ensure that directors will exercise their authority and duty in accordance with laws and regulations, the Company's Articles of Incorporation or resolutions adopted in shareholders' meetings. The structure of the Board of Directors should take into account the company operations, development and business scale, shareholding of major shareholders, and board diversity, for example, different professional backgrounds, gender, or field of work. The Company should select an appropriate number of board members, which should not be less than five, given consideration to actual operational needs.

The members of the Board of Directors should be selected with an emphasis on gender equality, and general knowledge, skills, and the competencies required to perform their duties. To achieve an ideal level of corporate governance, the Board of Directors as a whole should be equipped with the following abilities:

I. Ability to make sound business judgments
II. Ability to conduct accounting and financial analysis
III. Ability to manage the business

12 -
IV. Ability to manage a crisis
V. Industry knowledge
VI. An understanding of international markets
VII. Leadership ability

VIII. Decision-making ability

Administrative goals of the diversity policy of the Company’s 12[th] Board of Directors and their attainment status (2020– 2023):

Administrative goals of the diversity policy of the Company’s 1 2023):	2thBoard of Directors and their attainment status (2020–
Administrative goal	Goal attainment status
Less than half of independent directors are appointed for more than three consecutive terms.	Goal attained
Two or more female directors are appointed.	Goal attained
Less than one-third of board seats are filled by directors concurrentlyappointed to other executivepositions.	Goal attained
Two board seats are filled by major shareholders.	Goal attained

Implementation of board diversity

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Percentage of Percentage Percentage of
Professional background of
directors by of directors board members
individual directors
gender who are by age
concurrentl
Percentage y appointed
of in an
Title Name
independen executive Aged Aged
t directors capacity at 50 and 50 and
the parent over under
company or
a subsidiary
company
Chair Arthur Yu-Cheng Chiao M ✔ ✔ ✔ ✔ ✔
Vice Chair Tung-Yi Chan M ✔ ✔ ✔ ✔
Director Yung Chin F ✔ ✔ ✔ ✔ ✔
Independe Allen Hsu
M ✔ ✔ ✔ ✔
nt Director (cumulative tenure: 8 years)
Independe Stephen T. Tso
M ✔ ✔ ✔ ✔
nt Director (cumulative tenure: 3 years)
Independe Francis Tsai
M ✔ ✔ ✔ ✔ ✔
nt Director (cumulative tenure: 8 years) 82% 18% 36% 27% 82% 18%
Independe Jerry Hsu
M ✔ ✔ ✔ ✔
nt Director (cumulative tenure: 8 years)
Walsin Lihwa Corp.
Director M ✔ ✔ ✔ ✔
(representative: Fred Pan)
Chin Xin Investment Corp.
Director (representative: Yuan-Mou M ✔ ✔ ✔ ✔ ✔
Su)
Director Chih-Chen Lin M ✔ ✔ ✔ ✔ ✔
Director Wei-Hsin Ma F ✔ ✔ ✔ ✔ ✔
Gender
Male
Female
accounting Finance and Informatics
decision-making Leadership and Industry expertise
Business management
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Board independence: The Board of Directors is the highest governing body of Winbond Electronics Corporation. The Company’s 12[th] Board of Directors consists of 11 directors, four of whom are independent directors and two of whom are female. Directors who do not hold any executive position in either the parent company or a subsidiary company make up more than two-thirds of board members. Three of the directors are either spouses or relatives within the second degree of kinship and make up less than half of the board, pursuant to Article 26-3 of the Securities and Exchange Act . The board consists of members of varying ages who are highly experienced in business operations and whose knowledge and professional background span a wide range of fields, thus empowering them to perform their board duties, oversee business activities, and give constructive feedback on recommendations and strategies. Institutional directors Walsin Lihwa Corporation and Chin Xin Investment Corporation are major shareholders of the Company. Walsin Lihwa Corporation is a co-founder and the largest shareholder of the Company and has been a director since the Company's inception. According to the above evaluation results, the Company's Board of Directors meets the criteria for board independence.

14 -

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Relationship
Name
Title
Date first elected
Gender
Name
Nationality
Title
Notes See note 4 N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A N/A
March 16, 2023 Manager who is the person’s spouse or relative within the second degree of kinship N/A N/A N/A N/A N/A N/A
Innovation
Property
Intellectual
of
Concurrent positions held at other companies
See note 3 Chair of Winbond Electronics Corporation America Chair of Winbond Electronics (Suzhou) Ltd. Director of Landmark Group Holdings Ltd. Director of Winbond Electronics Corporation Japan Director of Winbond International Corporation Director of Pine Capital Investment Limited Director of Winbond Technology Ltd. Director of Marketplace Management Limited Director of Walton Advanced Engineering, Inc. Chair of Winbond Technology Ltd. Director of Winbond Electronics Corporation Japan Director of Winbond Electronics Corporation America Director of Miraxia Edge Technology Corporation Director of Winbond Electronics (Suzhou) Ltd. Director of Winbond Electronics (HK) Limited Director of Walsin Lihwa Corp. N/A Independent Director of Green River Holding Co. Ltd. Director Corporation Director of Winbond Electronics (H.K.) Limited Director of Winbond Electronics Corporation Japan Director of Landmark Group Holdings Ltd. Director of Winbond International Corporation Director of Winbond Electronics Corporation America Director of Winbond Electronics Germany GmbH Chair of Song Yong Investment Corporation
Education/Work experience
Chair of Walsin Lihwa Corp. MS in Electrical Engineering, University of Washington (UW) MRes, UW School of Business Administration President of Winbond Electronics Corporation CEO of BCD Semiconductor Ph.D. in Electrical Engineering, U.C. Berkeley Master’s in Management Science, Stanford University Chair of Nuvoton Technology Corporation Vice President of Winbond Electronics Corp. DRAM Product Business Group MSEE, University of Detroit Mercy, USA Vice President of the Sales Center, Winbond Electronics Corp. Vice President of Eversol Corp. Deputy Divisional Director, United Microelectronics Corp. PhD in Materials Science and Engineering, University of Utah Vice President of the Embedded Memory Business Group, Winbond Electronics Corp. Vice President of FocalTech Systems Co., Ltd. Vice President of Nanya Technology Co., Ltd. President of Ascend Semiconductor Corporation PhD in Electrical Engineering, U.C. Berkeley Vice President of Administrative Center, Nuvoton Technology Corporation MBA, National Chung Cheng University
Shareholding 2percentage - - - - - -
others
Shares held in the name of Number of shares - - - - - -
Shareholding 2percentage 0.30% - - - 0.00% -
- - - 9,000 -
shares
Shares currently held by spouse and minor children Number of
2
1.59% 11,778,797 0.01% 0.01% 0.00% 0.00% 0.01%
Shareholding percentage
Shares currently held shares 551,000 407,525 110,000 41,608 220,804
Number of 63,472,995
2005.08.01 2020.03.01 2020.03.01 2011.11.01 2014.10.01 2019.08.01
M M M M M M
Arthur Yu- Cheng Chiao Tung-Yi Chan Ming Chen Tsai Fan
James Pei- Chin-Fen Pei-Lin Pai Hsiang-Yun
R.O.C. R.O.C. R.O.C. R.O.C. R.O.C. R.O.C.
CEO Deputy CEO President Vice President Vice President Vice President
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Relationship
Name
Title
Date first elected
Gender
Name
Nationality
Title
Notes N/A N/A N/A N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A N/A N/A N/A
spouse or the second degree of kinship
Manager who is the person’s relative within N/A N/A N/A N/A N/A N/A N/A N/A
Concurrent positions held at other companies
N/A Director of Winbond Electronics (Suzhou) Ltd. Director of Winbond Electronics Corporation Japan Director of Winbond Electronics Germany GmbH Director of Callisto Holdings Limited Chair of Callisto Holdings Limited Chair of Winbond Electronics (Nanjing) Ltd. Director of Miraxia Edge Technology Corporation Director of Miraxia Technology Taiwan Corporation Director of Nuvoton Technology Corporation Supervisor of Song Yong Investment Corporation Director of Nuvoton Technology Korea Ltd. President/Director of Atfields Manufacturing Technology Corporation Director of GLMTD Technology Private Limited N/A Chair of Song Zhi Electronics (Suzhou) Limited President of Pine Capital Investment Limited Director of Winbond Electronics (HK) Limited Director of Nuvoton Investment Holding Ltd. Supervisor of Sil Tea & Herbs Co., Ltd. Manager of Goldbond LLC N/A President of Winbond Electronics (Suzhou) Ltd. Director of Winbond Electronics Corporation Japan Director of Winbond Electronics Corporation America Director of GLMTD Technology Private Limited
Education/Work experience
Division Director, Assistant Vice President, and Technical Vice Director of Winbond Electronics Corp. Assistant Researcher at the Material and Chemical Research Laboratories, ITRI MS in Materials Science and Engineering, National Taiwan University Assistant Vice President of Winbond Electronics Corp. MS in Industrial Engineering and System Management, Chung Hua University Assistant Vice President of the Microcontroller Product Center and Vice President of the Microcontroller Application Business Group, Nuvoton Technology Corporation Division Director of the Microcontroller Product and System Design Division and Assistant Vice President of the System Technology Center, Winbond Electronics Corp. MS in Electrical Engineering, National Cheng Kung University Cheng Kung University Division Director of Winbond Electronics Corp. Project Division Director of Episil Technologies Inc. Senior Division Director of Brilliance Semiconductor Inc. MS in Electronics, National Chiao Tung University Chief Auditor and Vice President of Winbond Electronics Corp. Vice President, Citibank MBA, Indiana University Auditing Officer and Division Director of Winbond Electronics Corp. MBA, National Taipei University Manager, Deputy Division Director, Division Director, and Technical Vice Director of Winbond Electronics Corp. EMBA, College of Commerce, National Chengchi University
2 - - - - MS in Electrical Engineering, National - - - -
16
Shareholding percentage
others
Shares held in the name of Number of shares - - - - - - - -
Shareholding 2percentage - 0.00% - - - - - 0.00%
- 4,000 - - - - - 25,241
shares
Shares currently held by spouse and minor children Number of
2 0.00% 0.00% 0.01% 0.01% 0.01% 0.01% 0.00% 0.00%
Shareholding percentage
Shares currently held shares 11,346 18,461 203,857 362,632 269,213 456,290 7,621 21,135
Number of
2019.11.01 2020.07.01 2022.10.01 2012.07.01 2014.10.01 2015.04.01 2020.06.17 2022.12.01
M M M M F M M
6
7 8
Lu Wen- Chang Hung 5Lin Mao-Hsiang Yen M Hsiu-Han Liao Huang Chen Chih- Chung Chou
Wen-Hua Jen-Lieh Jessica Kun-Lung
R.O.C. R.O.C. R.O.C. R.O.C. R.O.C. R.O.C. R.O.C. R.O.C.
Vice President Vice President Vice President Assistant Vice President Assistant Vice President Chief Financial Officer and Head of Finance Division Corporate Governan ce Officer Chief Financial Officer, Head of Finance
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Title Nationali Name Gender Date first el Shares currently held Shares currently held by spouse and minor children Shares held in the name of others Education/Work experience Concurrent positions held at other companies Manager who is the person’s spouse or relative within the second degree of kinship Notes	ty ected Number of shares Shareholding percentage2 Number of shares Shareholding percentage2 Number of shares Shareholding percentage2 Title Name Relationship	Division, and Corporate Governan ce Officer MS in Chemical Engineering, National Taiwan University of Science and Technology Director of Winbond Electronics Germany GmbH Director of HannStar Board Corporation Director of HannsTouch Solution Inc. Director of Global Investment Holdings Co., Ltd. Director of Glorystone Inc.	Division Head and Accountin g Officer R.O.C.Chin-Feng Yang F 2020.03.01 64,324 0.00% - - - - Manager, Senior Manager, Supervisor, and Deputy Division Director of Winbond Electronics Corp. MA in Accounting, National Chengchi University Director of Winbond Electronics (Suzhou) Ltd. Director of GLMTD Technology Private Limited Supervisor of Miraxia Edge Technology Corporation N/A N/A N/A N/A	Chief Informati on Officer R.O.C.Cheng- Kung Lin9 M 2006.11.01 1,684,607 0.04% 175,978 0.00% - - Vice President, Assistant Vice President, and Division Director of Winbond Electronics Corp. MS in Engineering Technology, National Taiwan Institute of Technology Chair of Miraxia Edge Technology Corporation Chair of Miraxia Technology Taiwan Corporation Director of Callisto Holdings Limited Director of Callisto Technology Limited Director of Pine Capital Investment Limited Director of Theaceae Conservation Corp. N/A N/A N/A N/A	N/A	Notes: 1. Pursuant to the Ministry of Finance’s official letter Tai-Tsai-Cheng-San-Tzu No. 0920001301, the executive personnel listed above include the President, Vice Presidents, Assistant Vice Presidents, Financial Officers, and Accounting Officers. 2. Shareholding percentage is based on the number of common shares outstanding (3,980,000,193 shares) as of March 16, 2023. 3. Please refer to note 3 of the section “Directors (1)”. 4. Please refer to note 15 of the section “Directors (1)”. 5. Jen-Lieh Lin began serving as Vice President of the Company on October 1, 2022. 6. Ms. Jessica Huang served as the Company’s Vice President and Head of Finance Division from April 1, 2015, to June 16, 2020, and later served as the Company’s Chief Financial Officer and Head of Finance Division from June 17, 2020, to November 30, 2022. Only information available prior to the end of her tenure as an executive at the Company is disclosed above. 7. Mr. Kun-Lung Chen served as the Company’s Corporate Governance Officer from June 17, 2020, to February 15, 2023. Only information available prior to the end of his tenure as an executive at the Company is disclosed above. 8. Mr. Chih-Chung Chou began serving as the Company’s Head of Finance Division on December 1, 2022, and was appointed as the Company’s Corporate Governance Officer on February 16, 2023. 9. Mr. Cheng-Kung Lin served as the Company’s Vice President from November 1, 2006, to November 14, 2020, and later served as the Company’s Chief Information Officer from November 15, 2020, to November 14, 2022. Only information available prior to the end of his tenure as an executive at the Company is disclosed above. 10. Mr. Eungjoon Park served as the Company’s Chief Business Officer from August 4, 2008, to September 30, 2022, and was appointed to the position of Chief Strategy Officer on October 1, 2022.
					N/A
					N/A
					N/A
					President and Director of Winbond Electronics Corporation America
					Executive Vice President of Winbond Electronics Corp. America Executive Vice President of NexFlash Technologies Inc. Executive Vice President of Azalea Microelectronics Corp. MS in Electrical Engineering, U.C. Berkeley
					-
					-
					-
					-
					-
					-
					2008.08.04
					M
					Eungjoon Park10
					U.S.A.
					Chief Strategy Officer

17 -

Date: December 31, 2022; unit: TWD in thousands	Title Name Directors’ remuneration Sum of (A+B+C+D) and percent of net income after tax5 (%NIAT) Remuneration from concurrently held employee positions Sum of (A+B+C+D+E+F+G) and percent of net income after tax5 (%NIAT) Remuneratio n received from the parent company or joint ventures (excepting subsidiaries)8 Remuneration (A)1 Pension (B)2 Directors’ remuneration from distribution of profits (C)3 Business expenses (D)4 Salaries, bonuses, and special expenses (E)6 Pensions (F)2 Employee compensation from distribution of profits (G)7 Winbond From All Consolidated Entities 9 Winbond From All Consolidated Entities 9 Winbond From All Consolidated Entities 9 Winbond From All Consolidated Entities 9 Winbond From All Consolidated Entities 9 Winbond From All Consolidated Entities 9 Winbond From All Consolidated Entities 9 Winbond From All Consolidated Entities9 Winbond From All Consolid ated Entities9 Cash Stocks Cash Stocks Chair Arthur Yu-Cheng Chiao - - 102,627 112,765 4,200 5,559 Sum: 106,827 %NIAT: 0.83% Sum: 118,324 %NIAT: 0.92% 106,229 134,761 - 261 1,465 - 9,525 - Sum 214,521 %NIAT: 1.66% Sum: 262,871 %NIAT: 2.03% 80,244 Vice Chair Tung-Yi Chan Director Yung Chin DirectorCorpora tion Walsin Lihwa Corp. Represe ntative Fred Pan DirectorCorpora tion Chin Xin Investment Corp. Represe ntative Yuan-Mou Su Director Chih-Chen Lin Director Wei-Hsin Ma Independent Director Allen Hsu 2,400 3,199 - - 51,313 58,743 2,400 3,199 Sum: 56,113 %NIAT: 0.43% Sum: 65,141 %NIAT: 0.50% - - - - - - - - Sum: 56,113 %NIAT: 0.43% Sum: 65,141 %NIAT: 0.50% - Independent Director Stephen T. Tso Independent Director Francis Tsai Independent Director Jerry Hsu	1. Pursuant to Winbond’s_Rules for Directors’ Remuneration and Board Performance Evaluations_, the remuneration paid to directors and independent directors is determined based on the Company's long- and short-term development plans, industry standards, and board performance evaluation results. Individual salaries are determined in a collegial manner consistent with the board’s values and in compliance with the principle of equality. If deemed necessary, remuneration may be adjusted to reflect changes in responsibilities or actual needs. 2. Remuneration paid to the directors of the Company for the services they provide not disclosed in the table above (including service as a non-employee consultant forthe parent company, joint venture, or any of the consolidated entities): 0 Notes: 1. Refers to remuneration paid to directors in the most recent year (including salaries, duty allowance, severance pay, bonuses, etc.) 2. Pensions include: a. Contributions (equal to 6% of the employee’s monthly salary) paid to an account overseen by the Bureau of Labor Insurance pursuant to the new pension system under the_Labor Pension Act_. b. Contributions (equal to 2% of the employee’s monthly salary) deposited into an account at the Bank of Taiwan under the name of the Company's Pension Supervisory Committee pursuant to the old pension system under the_Labor Standards Act_. c. Other types of pension required by law or stipulated in Winbond's_Retirement Rules_that are not described in the provisions above. 3. The Board of Directors approved a contribution rate of 1% to be made for the directors in 2022. Based on the audited earnings of the Company, the 1% contribution amounts to NT$153,940,000. 4. Refers to business expenses of directors in the most recent year (including transportation allowance, special allowance, stipends, housing expenses, vehicle expenses, and the cost of other material items provided). 5. Calculated from the net income after tax as stated in the Company’s financial statements in 2022: NT$12,927,165,000 6. Refers to the salaries, duty allowance, severance pay, bonuses, transportation allowance, special allowance, stipends, housing expenses, vehicle expenses, and the cost of other material items provided received by directors who concurrently held an employee position (including president, vice president, other managerial positions, or employee) in the most recent year. In addition, pursuant to IFRS 2, salary expenses recognized under “share-based payment” are included in the remuneration, including employee stock options, restricted stock awards, and stocks issued through cash capital increases. 7. As of the date of the report, the remuneration paid to individual directors concurrently holding an employee position has yet to be determined. The figures listed in the table above are estimates. 8. a. This column details the total remuneration received by the Company’s directors from non-subsidiary joint ventures. b. Remuneration refers to the compensation and pay (including salaries paid to employees, directors, and supervisors) received by the Company’s directors for their service as directors, supervisors, or in other managerial positions, as well as compensation for business expenses. 9. Refers to the total remuneration received by the Company’s directors from all companies (including Winbond) listed in the consolidated financial statements.
	Directors’ remuneration Sum of Remuneration from concurrently held employee positions Sum of (A+B+C+D+E+F+G) Remuneratio

18 -

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10
13
Winbond and its Invested Enterprises
Walsin Lihwa Corp. (representative: Fred Pan) Stephen T. Tso, Francis Tsai, Wei-Hsin Ma, Chih-Chen Lin, Walsin Lihwa Corp. Allen Hsu, Jerry Hsu, Chin Xin Investment Corp. Tung-Yi Chan, Yung Chin, Chin Xin Investment Corp. (representative: Yuan-Mou Su) Arthur Yu-Cheng Chiao
13
Sum of all remuneration categories (A+B+C+D+E+F+G)
Winbond
Walsin Lihwa Corp. (representative: Fred Pan), Chin Xin Investment Corp. (representative: Yuan-Mou Su) Allen Hsu, Stephen T. Tso, Francis Tsai, Jerry Hsu, Wei-Hsin Ma, Chih-Chen Lin, Walsin Lihwa Corp., Chin Xin Investment Corp. Tung-Yi Chan, Yung Chin Arthur Yu-Cheng Chiao
Names of Directors
6
13
All Consolidated Entities
Walsin Lihwa Corp. (representative: Fred Pan), Chin Xin Investment Corp. (representative: Yuan-Mou Su) Tung-Yi Chan, Yung Chin, Stephen T. Tso, Francis Tsai, Wei-Hsin Ma, Chih-Chen Lin, Walsin Lihwa Corp. Allen Hsu, Jerry Hsu, Chin Xin Investment Corp. Arthur Yu-Cheng Chiao
13
Sum of the first four remuneration categories (A+B+C+D) Winbond
Walsin Lihwa Corp. (representative: Fred Pan), Chin Xin Investment Corp. (representative: Yuan-Mou Su) Tung-Yi Chan, Yung Chin, Allen Hsu, Stephen T. Tso, Francis Tsai, Jerry Hsu, Wei-Hsin Ma, Chih- Chen Lin, Walsin Lihwa Corp., Chin Xin Investment Corp. Arthur Yu-Cheng Chiao
Range of remuneration paid to each director
Below NT$1,000,000 NT$1,000,000 (inclusive) – NT$2,000,000 (exclusive) NT$2,000,000 (inclusive) – NT$3,500,000 (exclusive) NT$3,500,000 (inclusive) – NT$5,000,000 (exclusive) NT$5,000,000 (inclusive) – NT$10,000,000 (exclusive) NT$10,000,000 (inclusive) – NT$15,000,000 (exclusive) NT$15,000,000 (inclusive) – NT$30,000,000 (exclusive) NT$30,000,000 (inclusive) – NT$50,000,000 (exclusive) NT$50,000,000 (inclusive) – NT$100,000,000 (exclusive) Over NT$100,000,000 Total number of directors Note: Remuneration received from non-subsidiary joint ventures was included when calculating the range of remuneration received by each director.
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7,024
other than
Reinvestment or Parent Company
Unit: NT$ thousand Remuneration from Subsidiaries (Note 7)
；
Total: 318,499 2.46%
Percentage:
December 31, 2022
Statements (Note 5)
All Companies In Financial
Jen-Lieh Lin 12 persons
Chih-Chung Chou
After-tax Income (%) (Note 6)
Total of (A), (B), (C), (D), and Ratio to Company Total: 318,499 Percentage 2.46% Tung-Yi, Chan, Wen-Hua Lu
The Company and All Investees (Note)
Arthur Yu-Cheng Chiao, James Pei-Ming Chen
0
Stock Bonus
Statements (Note 5) 4,745
All Companies In Financial Cash Bonus Chin-Fen Tsai, Pei-Lin Pai, Hsiang-Yun Fan, Wen-Chang Hung, Cheng-Kung Lin, Jessica Huang
0
Stock Bonus
Employee Bonus (D) (Note 4)
Company
Cash Bonus 4,745
Names of President and Vice Presidents
(Note 5) 251,823
In Financial Statements
All Companies
Bonus and Special
Allowances (C) (Note 3) Company 251,823
The Company Jen-Lieh Lin 12 persons
689 Chih-Chung Chou
(Note 5)
All Companies In Financial Statements Tung-Yi Chan, Wen-Hua Lu
Pension (B) (Note 2) 689 Arthur Yu-Cheng Chiao, James Pei-Ming Chen
Company
(Note 5) 61,242
In Financial Statements
All Companies
Chin-Fen Tsai, Pei-Lin Pai, Hsiang-Yun Fan, Wen-Chang Hung, Cheng-Kung Lin, Jessica Huang
Remuneration (A) (Note 1) Company 61,242
Name
Arthur Yu-Cheng Chiao Tung-Yi Chan James Pei-Ming Chen Cheng-Kung Lin (Note 8) Jessica Huang (Note 9) Chih-Chung Chou (Note 10) Jen-Lieh Lin (Note11) Chin-Fen Tsai Pei-Lin Pai Hsiang-Yun Fan Wen-Hua Lu Wen-Chang Hung Presidents ）～NT$15,000,000 (exclusive) NT$30,000,000 (exclusive) ～
inclusive
（
Title CEO
Vice CEO President Range of Remuneration Paid to President and Vice
Vice President Vice President Vice President Vice President Vice President Vice President
Refers to the pension system under the Labor Pension Act or the new pension fund, for which 6% of the employee's monthly salary in the current year is contributed to the Labor Insurance Bureau. Refers to the pension system under the Labor Standards Act or the old pension fund, for which 2% of the employee's monthly salary is contributed to the Supervisory Committee of Workers' Retirement Reserve Fund to deposit in the Bank of Taiwan under the name of the committee. employee stock options, restricted stock awards, and shares acquired from participation in cash capital increase options, which are also included in remuneration. as the manager. information to the date of termination of her position as manager.
Chief Information Officer Chief Financial Officer Chief Financial Officer Notes: 1: The most recent annual salary, managerial bonus, and severance pay of the president and vice presidents are presented above. 2: The retirement pension system includes the following: a. b. c. In addition to the above-mentioned pension contributions made according to law, pensions payable according to law and pensions paid under retirement regulations are also included. 3: Refers to bonuses, incentives, transportation allowance, special allowance, housing, and company vehicles, and other benefits and compensation. The salaries and expenses listed in accordance with IFRS 2 Share-Based Payment include shares acquired under 4: The board of directors has resolved to approve the total employee remuneration for 2022. The employee remuneration of the president and vice president in the above table is a provisional figure. 5: The total amount of remuneration to the president and vice president from all companies in the consolidated statements (including Winbond). 6: Calculated based on the 2022 individual financial report after-tax net profit of NT$ 12,927,165 thousand. 7: a. This field shows the amount of related remuneration the president and vice presidents received from investees other than subsidiaries. b. The remuneration refers to pay, bonuses (including bonuses to employees, directors, and supervisors), and related remuneration for the performance of duties received by the president and vice president while serving as a director, supervisor, or manager of an investee other than subsidiaries. 8: Mr. Cheng-Kung Lin served as vice president from November 1, 2006 to November 14, 2020 and the Chief Information Officer from November 15, 2020 to November 14, 2022. The above table only discloses information to the date of termination of his position 9: Ms. Jessica Huang served as vice president and Head of Finance Department from April 1, 2015 to June 16, 2020; from June 17, 2020 to November 30, 2022, she served as Chief Financial officer and Head of Finance Department. The above table only discloses 10: Mr. Chih-Chung Chou took office as Head of Finance Department effective December 1, 2022. The above table only discloses the information during the period he has served as manager. 11: Mr. Jen-Lieh Lin took office as vice president effective from October 1. 2022. NT$100,000,000 Total Note: The range of remuneration includes the remuneration received by presidents and vice presidents from re-investment in other than subsidiaries.
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3. Distribution of Employee Bonuses to Managers

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December 31, 2022: Unit: NT$ thousand
Percentage of the Total
Stock Cash
Title Name Total to After-Tax Net Income
bonus Bonus
(%) (Note 2)
CEO Arthur Yu-Cheng Chiao
Vice CEO Tung-Yi Chan
President James Pei-Ming Chen
Vice President Chin-Fen Tsai
Vice President Pei-Lin Pai
Vice President Hsiang-Yun Fan
Vice President Wen-Hua Lu
Vice President Wen-Chang Hung
Vice President Jen-Lieh Lin (Note 3) 6,440 6,440 0.05%
Assistant Vice President Mao-Hsiang Yen
Assistant Vice President Hsiu-Han Liao
Chief Financial Officer and Head of Finance Department Jessica Huang (Note 4)
Corporate Governance Officer Kun-Lung Chen
Chief Financial Officer and Head of Finance Department Chih-Chung Chou (Note 5)
Head of Accounting Department Chin-Feng Yang
Chief Information Officer Cheng-Kung Lin
Chief Strategy Officer Eungjoon Park (Note 7)
Managers
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Notes:

1: The board of directors has resolved to approve the total employee remuneration for 2022. The employee remuneration of the president and vice president in the above table is a provisional figure.
2: Calculated based on the 2022 individual financial report after-tax net profit of NT$ 12,927,165 thousand.
3: Mr. Jen-Lieh Lin took office as vice president effective October 1, 2022.
4: Ms. Jessica Huang served as vice president and Head of Finance Department from April 1, 2015 to June 16, 2020; from June 17, 2020 to November 30, 2022, she served as Chief Financial Officer and Head of Finance Department. The above table only discloses information to the date of termination of her position as manager.
5: Mr. Chih-Chung Chou took office as Head of Finance Department effective from December 1, 2022. The above table only discloses the information during the period he has served as manager.
6: Mr. Cheng-Kung Lin served as vice president from November 1, 2006 to November 14, 2020 and Chief Information Officer from November 15, 2020 to November 14, 2022. The above table only discloses information to the date of termination of his position as manager.
7: Mr. Eungjoon Park served as Business Executive from August 4, 2008 to September 30, 2022. He took office as Chief Strategy Officer effective October 1, 2022.
Analysis of total remuneration as a percentage of net income listed in individual financial reports is as paid by all entities in consolidated financial statements during the past 2 fiscal years to directors, presidents, and vice presidents with the description of policies, standards, packages, procedures for determining remuneration, and linkage to operating performance and future risk exposure.
(1) Analysis of total remuneration as a percentage of net income listed in individual financial reports as paid during the past 2 fiscal years to directors, presidents, and vice presidents.

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Total Remuneration as Percentage (%) of After-tax Net Income (%)
2022 2021
Title
Companies in Consolidated Companies in Consolidated
Company Company
Financial Statements Financial Statements
Director 2.09% 2.53% 1.78% 1.90%
President/Vice President 2.46% 2.46% 1.09% 1.09%
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(2) Policies, standards, packages, procedures for determining remuneration, linkage to operating performance, and future risk exposure
A. Policies, standards, packages, and procedures for determining remuneration

(A) Directors

Article 22 of Articles of Incorporation: No over 1% of the pre-tax net profit for the current year before deducting employee’s and directors’ remuneration shall be allocated as directors’ remuneration.

The Remuneration Committee recommends directors’ remuneration as per Articles of Incorporation, Rules for Directors’ Remuneration and Board Performance Evaluations, board members’ self-assessment results, and earnings for the year

21 -

after deducting the accumulated deficit. Recommended remuneration is reported at shareholders’ meetings after the passage of a resolution to that effect by the Board of Directors.

(B) President and Vice Presidents

Remuneration paid to managerial personnel is decided as per the Articles of Incorporation and the Rules for Directors’ Remuneration and Board Performance Evaluations, including salary, bonuses, and employee compensation systems and standards. Remuneration is distributed after being reported to the Remuneration Committee and approved by the Board of Directors.

B. Linkage to operating performance and future risk exposure

Established in 2011 to reduce operating risks, the Remuneration Committee annually conducts regular reviews of performance targets, salary, as well as remuneration policy, systems, standards, and structures of directors and managerial personnel in view of operational status, future risk exposure, and related regulations to seek a balance between sustainability and risk management. The remuneration of directors and managerial personnel is thus positively correlated with business performance.

IV. Corporate Governance Status

Overview of Board of Directors Operations
(1) The Board of Directors held 7 meetings in total in 2022(A). The attendance records of the Directors are as follows:

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Title Name Attended in Person (B) Attended by Proxy Attendance Percentage (%) (B/A) Remarks
Chair Arthur Yu-Cheng Chiao 7 0 100% None
Vice Chair Tung-Yi, Chan 7 0 100% None
Director Yung Chin 7 0 100% None
Independent Director Allen Hsu 6 1 86% None
Independent Director Stephen T. Tso 7 0 100% None
Independent Director Francis Tsai 7 0 100% None
Independent Director Jerry Hsu 7 0 100% None
Walsin Lihwa Corporation
Director 7 0 100% None
(Representative: Fred Pan)
Chin-Xin Investment Co., Ltd
Director 7 0 100% None
(Representative: Yuan-Mou Su)
Director Jamie Lin 7 0 100% None
Director Wei-Hsin Ma 7 0 100% None
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(2) Matters and items stipulated in Article 14-3 of the Securities and Exchange Act: Not applicable since Winbond has established the Audit Committee

(3) In addition to the foregoing, other matters to be resolved by board of director meetings about which an independent director expressed objections or reservations on record or stated in writing: None

(4) Director recusals due to conflicts of interest:

xpressed objections or reservations on record or irector recusals due to conflicts of interest:	stated in writing: None
Name(s) of Directors	Proposal	Reason for Recusal	Voting Status	Remarks
Independent Director Allan Hsu, Independent Director Jerry Hsu, Director Chin-Xin Investment Co., Ltd Representative Yuan-Mou Su, DirectorWei-Hsin Ma	Proposal to lift non- competitive requirement for Directors	Personal stake	Recused as provided by law	12th Term 14th Meeting
Vice Chair Tung-Yi Chan	Remuneration proposal for managers	Personal stake	Recused as provided by law	12th Term 14th Meeting
Chair Arthur Yu-Cheng Chiao, Director Yung Chin, Director Chin-Xin Investment Co., Ltd Representative Yuan-Mou Su	Remuneration proposal for Manager Arthur Yu-Cheng Chiao	Personal stake	Recused as provided by law	12th Term 14th Meeting

22 -

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Name(s) of Directors Proposal Reason for Recusal Voting Status Remarks
Chair Arthur Yu-Cheng Chiao, Sale of 30% of the land
Recused as
Director Yung Chin, holdings in Baoshan Township, 12th Term
Personal stake provided by
Director Chin-Xin Investment Co., Ltd Representative Hsinchu County to Theaceae 15th Meeting
law
Yuan-Mou Su Conservation Corporation
Chair Arthur Yu-Cheng Chiao,
Recused as
Director Yung Chin, Investment in TCC Green 12th Term
Personal stake provided by
Director Chin-Xin Investment Co., Ltd Representative Energy Corporation 16th Meeting
law
Yuan-Mou Su
Chair Arthur Yu-Cheng Chiao,
Director Yung Chin,
Participation of Walsin Lihwa
Director Chin-Xin Investment Co., Ltd Representative Recused as
Corporation in cash capital 12th Term
Yuan-Mou Su, Personal stake provided by
increase by issuing new shares 17th Meeting
Director Walsin Lihwa Corporation Representative law
in 2022
Fred Pan,
Director Wei-Hsin Ma
Chair Arthur Yu-Cheng Chiao,
Director Yung Chin, Acquisition of major asset Recused as
(100% share in Atfields 12th Term
Independent Director Allan Hsu, Personal stake provided by
Manufacturing Technology 18th Meeting
Director Chin-Xin Investment Co., Ltd Representative law
Corporation)
Yuan-Mou Su
Recused as
Remuneration proposal for 12th Term
Vice Chair Tung-Yi Chan Personal stake provided by
managers 18th Meeting
law
Chair Arthur Yu-Cheng Chiao,
Remuneration proposal for Recused as
Director Yung Chin, 12th Term
Manager Arthur Yu-Cheng Personal stake provided by
Director Chin-Xin Investment Co., Ltd Representative 18th Meeting
Chiao law
Yuan-Mou Su
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(5) Board performance evaluations:

A board performance evaluation system was established in 2011 to measure board performance in guiding strategic direction and overseeing operations and management to increase long-term value for shareholders. The unit in charge of board meeting affairs compiles and submits results to the Remuneration Committee and the Board of Directors then draws up a board performance improvement plan accordingly.

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Frequency Period Scope Method Item Result
(1)Overall evaluation results of the Board:
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(5) Board performance evaluations: A board performance evaluation system was established in 2011 to measure board performance in guiding strategic direction and overseeing operations and management to increase long-term value for shareholders. The unit in charge of board meeting affairs compiles and submits results to the Remuneration Committee and the Board of Directors then draws up a board performance improvement plan accordingly.	(5) Board performance evaluations: A board performance evaluation system was established in 2011 to measure board performance in guiding strategic direction and overseeing operations and management to increase long-term value for shareholders. The unit in charge of board meeting affairs compiles and submits results to the Remuneration Committee and the Board of Directors then draws up a board performance improvement plan accordingly.	(5) Board performance evaluations: A board performance evaluation system was established in 2011 to measure board performance in guiding strategic direction and overseeing operations and management to increase long-term value for shareholders. The unit in charge of board meeting affairs compiles and submits results to the Remuneration Committee and the Board of Directors then draws up a board performance improvement plan accordingly.	(5) Board performance evaluations: A board performance evaluation system was established in 2011 to measure board performance in guiding strategic direction and overseeing operations and management to increase long-term value for shareholders. The unit in charge of board meeting affairs compiles and submits results to the Remuneration Committee and the Board of Directors then draws up a board performance improvement plan accordingly.	(5) Board performance evaluations: A board performance evaluation system was established in 2011 to measure board performance in guiding strategic direction and overseeing operations and management to increase long-term value for shareholders. The unit in charge of board meeting affairs compiles and submits results to the Remuneration Committee and the Board of Directors then draws up a board performance improvement plan accordingly.	(5) Board performance evaluations: A board performance evaluation system was established in 2011 to measure board performance in guiding strategic direction and overseeing operations and management to increase long-term value for shareholders. The unit in charge of board meeting affairs compiles and submits results to the Remuneration Committee and the Board of Directors then draws up a board performance improvement plan accordingly.
Frequency Period Scope Method Item Result
					(1)Overall evaluation results of the Board:
Once per year (in December)	January 1, 2022 to December 31, 2022	Board, Board Members, Functional Committees	Internal self- evaluation	(1) Board: A. Involvement in operations B. Improvement of quality of Board decisions C. Composition and structure of board of directors D. Selection and continuing education of directors E. Internal controls (2) Individual Board Members: A. Understanding of objectives and tasks B. Awareness of directors' responsibilities C. Involvement in operations D. Internal relationship management and communication E. Professional and continuing education of directors F. Internal controls (3) Functional Committees: A. Involvement in operations B. Awareness of the responsibilities of the functional committees C. Improvement of the quality of decision-making in functional committees D. Composition and selection of functional committee members E. Internal controls	A major decrease in the selection and continuing education of directors compared to 2021. Improvement measures: (1) With the election of the 13th board of directors in 2023, the composition of the board will be altered due to requirements that half of the independent directors serve no over 3 consecutive terms, for the participation of female directors, and for the inclusion of cross-generational elite talent from various fields to ensure the board's independence, continuing innovativeness, and diversity (2) Continue to provide multi-faceted training courses to strengthen the decision-making abilities of board members (2) Evaluation results of individual Board Members: A. 4.97 B. 5.00 C. 4.87 D. 4.91 E. 5.00 F. 4.91 (3) Evaluation results of Functional Committees: A. 4.90 B. 5.00 C. 5.00 D. 5.00 E. 5.00

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Frequency Period Scope Method Item Result
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Note 1: Evaluation levels 1: Very poor (strongly disagree) 2: Poor (disagree) 3: Moderate (average) 4: Excellent (agree) 5: Outstanding (strongly agree) Note 2: The evaluation results were submitted to the Remuneration Committee and the Board of Directors in March.

(6) Target evaluation for strengthening board functions and implementation status during current and preceding fiscal years:
Pursuant to the Rules for Directors’ Remuneration and Board Performance Evaluations, we have authorized Taiwan Corporate Governance Association to conduct board performance evaluations in May 2022, the results and improvement plans of which were reported to the Board of Directors in December 14, 2022. Please refer to our official website for detailed information on this matter.
We will continue to provide multi-faceted training courses to strengthen the decision-making abilities of board members. 6 sessions were held on February 24th, July 21st, September 2nd and 16th, October 27th, and December 27th in 2022.
Quarterly strategy review meetings are held before scheduled board meetings or as needed with directors attending to understand finances, operations, formulation of major strategies, and execution of relevant business plans. We endeavor to strengthen corporate information transparency by holding investor conferences to discuss operations and finances after semi-annual and annual board meetings as well as posting relevant information on the Market Observation Post System and the official website.
Operation and Responsibilities of the Audit Committee
7 Audit Committee meetings (A) were held in 2022; member attendance was as follows:

Title	Name	Attended in Person (B)	Attended by Proxy	Attendance rate (%) (B/A)
Convenor of Audit Committee	Allen Hsu	6	1	86
Audit committee member	Stephen T. Tso	7	0	100
Audit committee member	Francis Tsai	7	0	100
Audit committee member	Jerry Hsu	7	0	100

Note: The Audit Committee’s second term started on June 12, 2020 and ended on June 11, 2023.

Key tasks of the Audit Committee are as follows (operations and proposals listed in the table):

Fair presentation of financial reports.
Hiring (and dismissal) of certified public accountants with evaluations of independence and performance.
Effective implementation of the internal control system.
Compliance with relevant laws and regulations.
Management of existing or potential risks.

Other matters that require reporting:

If any of the following occurs during the operation of the Audit Committee, the Audit Committee meeting date and number, proposal contents, independent directors’ objections, reservations, and significant recommendations, resolutions, and the handling of opinions shall be clearly described:

(1) Resolutions related to Article 14-5 of the Securities and Exchange Act:

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Content of Independent
Resolution Handling of Audit
Audit Committee Directors' Objections,
Proposal Contents of Audit Committee
Meeting Date Reservations, or Significant
Committee Member Opinions
Recommendations
11th Meeting Acquisition of 3 units in the Langjing project in Lingya
None Passed None
March 15, 2022 District, Kaohsiung
Amendment of procedures for acquisition and disposal of
None Passed None
assets
Removal of non-compete clause for directors None Passed None
Amendment of Audit Committee’s organizational
None Passed None
regulations
Approval of consolidated financial report for 2022 Q1 None Passed None
Increase in capital expenditure budget None Passed None
2nd Term
Sale of 30% of land holdings in Baoshan Township, Hsinchu
12th Meeting None Passed None
May 5, 2022 County to Theaceae Conservation Corporation
Amendment of Stock Affairs Department’s internal control
None Passed None
system
2nd Term
13th Meeting Investment in TCC Green Energy Corporation None Passed None
March 10, 2022
Approval of consolidated financial report for 2022 Q2 None Passed None
Proposal not to distribute earnings for the first half of the
None Passed None
2022 fiscal year
2nd Term Participation of Walsin Lihwa Corporation in cash issue for
None Passed None
14th Meeting capital increase in 2022
August 14, 2022 Planning to establish a subsidiary through fully-owned
None Passed None
Japanese subsidiary Miraxia Edge Technology Corporation
Adjustments to investment structure of subsidiaries in
None Passed None
Japan and India
2nd Term Approval of consolidated financial report for 2022 Q3 None Passed None
15th Meeting Increase in capital expenditure budget None Passed None
November 3, The acquisition of major asset (100% shareholding in
None Passed None
2022 Atfields Manufacturing Technology Corporation)
Amendment of Accounting System None Passed None
2nd Term
Amendment of Internal Control System None Passed None
16th Meeting
December 14, Finalization of 2023 audit plan None Passed None
2022 Liquidation of fully-owned subsidiaries Landmark Group None Passed None
Holdings Ltd. and Pine Capital Investment Ltd
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(2) Except for the above items, items that were not approved by the Audit Committee but were resolved by over 2-thirds of all directors: None

Concerning the recusal of independent directors from discussing or voting on an agenda item with a conflict of interest, please state the name of the independent director, agenda item, reason for recusal, and votes:

Names of Independent Directors	Agenda Item	Reason for Recusal	Voting Status	Remarks
Jerry Hsu, Allen Hsu	Removal of non-compete clause for directors	Personal stake	Recused as provided by law	2nd Term 11th Meeting
Jerry Hsu	Acquisition of major asset (100% share-holding in Atfields Manufacturing Technology Corporation)	Personal stake	Recused as provided by law	2nd Term 15yh Meeting

Description of communications between independent directors, internal auditors, and CPA (please include material items, channels of communication, and audit results of corporate finances and/or operations, etc.):

Communication guideline:

(1) Communication on audit implementation is held in separate meetings between independent directors and the internal audit chief. The internal audit unit conducts audits according to the annual audit plan. The audit chief submits audit reports upon completion to the independent directors (or the convenor of audit committee) for approval each month and delivers each audit report to the independent directors for review by the end of the month following the completion of the audit.

(2)The audit chief reports to the Board of Directors and Audit Committee on a quarterly basis.

The communications between independent directors and the internal audit chief in 2022 were as follows:

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Date Topics of communication Recommendations and actions taken
2nd Term •2021 Q4 internal audit report •None of the independent directors
10th Meeting  2021 Q4 follow-up on improvement measures taken for deficiencies found in expressed dissent.
February 11, 2022 the previous period •The Committee consented to the 2021
 Audit findings of 2021 Q4 audit plan Statement on the Internal Control System,
 Report on cybersecurity issues which will be submitted to the Board of
•2021 self-evaluation of internal control system Directors for approval.
•2021 Statement on the Internal Control System
2nd Term •2022 Q1 internal audit report •None of the independent directors
12th Meeting  2022 Q1 follow-up on improvement measures taken for deficiencies found in expressed dissent.
May 5, 2022 the previous period
 Audit findings of 2022 Q1 audit plan
 Report on cybersecurity issues
2nd Term •2022 Q2 internal audit report •None of the independent directors
14th Meeting  2022 Q2 follow-up on improvement actions taken for deficiencies found in the expressed dissent.
August 4, 2022 previous period
 Audit findings of 2022 Q2 audit plan
 Report on cybersecurity issues
2nd Term •2022 Q3 internal audit report •None of the independent directors
15th Meeting  2022 Q3 follow-up on improvement actions taken for deficiencies found in the expressed dissent.
November 3, 2022 previous period
 Audit findings of 2022 Q3 audit plan
 Report on cybersecurity issues
2nd Term • 2022 audit plan •The Committee reviewed and consented to
16th Meeting the 2023 audit plan, which will be submitted
December 14, to the Board of Directors for approval.
2022
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(2) Communication between independent directors and CPAs:

Independent directors communicate directly with the CPAs on the financial situation biannually and as necessary. In 2022, the following communications took place:

Date	Topics of communication	Recommendations and actions taken
2nd Term 10th Meeting February11,2022	•CPAs and independent directors discussed 2020 audit findings on key audit matters (KAM). •CPAs and independent directors reviewed audit materiality and major risks.	•None of the independent directors expressed dissent.
2nd Term 14th Meeting August 4,2022	•CPAs and independent directors discussed the conclusions of the major accounting treatment of subsidiary Nuvoton Technology Corporation this quarter. •CPAs and independent directors discussed the CFC(Controlled Foreign Company)system.	•None of the independent directors expressed dissent.

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3. Operational status of the Remuneration Committee:

(1) Information on members of the Compensation Committee:

				March 16,2023
Position	Criteria Name	Professional qualifications and work experience	Independence criteria	Number of additional public companies on the Remuneration Committee of which the member also serves
Convenor/ Independent director	Stephen T. Tso	Please refer to "Disclosure of Professional Qualifications of Directors and Independence of Independent Directors" onpages 10 to 12.	Please refer to "Disclosure of Professional Qualifications of Directors and Independence of Independent Directors" onpages 10 to 12.	1
Member/ Independent director	Allen Hsu	Please refer to "Disclosure of Professional Qualifications of Directors and Independence of Independent Directors" onpages 10 to 12.	Please refer to "Disclosure of Professional Qualifications of Directors and Independence of Independent Directors" onpages 10 to 12.	1
Member/ Independent director	Francis Tsai	Please refer to "Disclosure of Professional Qualifications of Directors and Independence of Independent Directors" onpages 10 to 12.	Please refer to "Disclosure of Professional Qualifications of Directors and Independence of Independent Directors" onpages 10 to 12.
Member/ Independent director	Jerry Hsu	Please refer to "Disclosure of Professional Qualifications of Directors and Independence of Independent Directors" onpages 10 to 12.	Please refer to "Disclosure of Professional Qualifications of Directors and Independence of Independent Directors" onpages 10 to 12.

(2) Operational state of the Remuneration Committee:

The Remuneration Committee evaluates the performance of the directors and managerial personnel, reviews policy, system, standards, structure, and individual remuneration, and presents recommendations to the Board of Directors for discussion. Key tasks of the Remuneration Committee are as follows:

A. Periodically review the Remuneration Committee Charter with recommendations for amendment.
B. Set and regularly review annual performance targets, salary as well as remuneration policy, system, standards, and structure of directors and managerial personnel.
C. Periodically evaluate the attainment of performance targets by directors and managerial personnel, as well as determine the type and amount of remuneration for them.
D.1 The 4th-term Remuneration Committee is composed of 4 individuals and includes all Independent Directors.
D.2 Current term of office: June 12, 2020 ~ June 11, 2023. The Committee held 4 meetings (A) in 2022. The attendance record is as follows:

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Title Name Attended in Person (B) Attended by Proxy Attendance (%) (B/A) Remarks
Convenor Stephen T. Tso 4 0 100 None
Member Allen Hsu 4 0 100 None
Member Francis Tsai 4 0 100 None
Member Jerry Hsu 4 0 100 None
Other matters that require reporting:
I. If the Board of Directors did not adopt the recommendations of the Remuneration Committee or revised them, describe the date of the board meeting, term of the
board, agenda item, resolutions adopted by the board, and actions taken in response to the opinion of the Remuneration Committee: None
II. If any member has a objections or reservations concerning any resolution involving the Remuneration Committee that is on record or stated in a written statement,
describe the date of the committee meeting, term of the committee, agenda item, opinions of all members, and actions taken in response to the opinions of members:
None
III. Proposals of the Remuneration Committee and their resolution in the past year, and the response to member opinions:
Remuneration Response to
Topic Resolution
Committee Members' Opinions
Proposal re 2021 remuneration for individual directors on the 12th-term board Passed None
Proposal re 2022 remuneration for individual directors on the 12th-term board Passed None
4th Term/ 6th Meeting
March 15, 2022 Proposal re remuneration for managers Passed None
Proposal re 2022 remuneration for individual managers Passed None
Proposal re remuneration for manager Arthur Yu-Cheng Chiao Passed None
4th Term/ 7th Meeting
Re-appointment of Ms. Jessica Huang as consultant and Head of Finance Department Passed None
May 5, 2022
4th Term/ 8th Meeting Appointment of Mr. Jen-Lieh Lin to serve as Vice President Passed None
August 4, 2022 Discharge of Mr. John Park as a Business Executive and his appointment as Chief Strategy Officer Passed None
Appointment of Mr. Chih-Chung Chou as manager and Head of Finance Department Passed None
2022 director compensation distribution plan Passed None
4th Term/ 9th Meeting
March 15, 2022 2022 employee compensation distribution plan Passed None
Proposal re 2022 quarterly remuneration for managers Passed None
Proposal re remuneration for manager Arthur Yu-Cheng Chiao Passed None
We reviewed the Remuneration Committee Charter , Rules for Directors’ Remuneration and Board Performance Evaluations , and Rules for Remuneration and Performance
Evaluations of Managerial Officers at the 9th Remuneration Committee meeting (4th term) and found that they are in compliance with relevant laws and regulations and
that no adjustments are required due to changes in laws and regulations; therefore no recommendations for the amendment were made.
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Deviations from Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies None None None None None None None None None None
Implementation Status Explanation
or litigation matters as per Regulations Governing the Administration of Shareholder Services of Public Companies and internal control system standards. per applicable regulations. principles of fairness and reasonableness in the formation of written rules, pricing, and payment terms to prevent non-arm’s-length transactions. monthly reminders to all insiders and employees. due consideration to business scale, major shareholdings, and member diversity (professional backgrounds, genders, lines of work, etc.). Our board composition meets these targets (see p. 12 of annual report for specific management targets and implementation status pertaining to the 12th Board of Directors). and Risk Management Committee, and Patent Committee have been established. December as per Rules for Directors’ Remuneration and Board Performance Evaluations. The staff in charge of board meeting affairs compile and submit self-assessment results to the Remuneration Committee and the Board of Directors as references for nomination and re-election of directors. Please refer to the appropriate section under “The Operational Status of the Board of Directors” for more information. Accountant Act and the Norm of Professional Ethics for Certified Public Accountants of the Republic of China. Members of the Audit Committee evaluate the independence of the CPAs every December to examine whether any CPAs are directors, shareholders, salaried employee, or stakeholder. Results are submitted to the Audit Committee and the Board of Directors. In 2023, they referred to the 2021 audit quality report (from June 1, 2021 to May 31, 2022) provided by the certified accounting firm for accountant appointments; CPAs are required to recuse themselves if either they or their services are directly affiliated with or have a conflict of interest in the matter concerned. Rules concerning accountant rotation are observed.
procedures and applicable laws as well as facilitate exchange and communication between directors and management. attendance as needed (7 meetings convened in 2021) information by prescribed deadlines with English versions available to investors worldwide (1 convened in 2021)
Corporate governance principles as per TWSE Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and internal regulations are established and disclosed on the official website. (I) The Shareholders’ Affairs Department oversees and handles shareholders’ services, suggestions, concerns, disputes, (II) A register of major shareholders with controlling power and persons with ultimate control over them is disclosed as (III) Business dealings with affiliates are treated as transactions with independent third parties while abiding by the (IV) Procedures for the Prevention of Insider Trading have been established and are disclosed on the official website with (I) Article 20 of Corporate Governance Best Practice Principles stipulates the structure of the Board of Directors shall give (II) ESG Committee, Employee Welfare Committee, Supervisory Committee of Workers’ Retirement Reserve Fund, ESH (III) Performance evaluations of the board, individual directors, and functional committees are conducted every (IV) The Rules for Evaluation and Performance Reviews of Accountants have been established as per the Certified Public The position of corporate governance officer was created in March 2019 to comply with board and shareholder meeting Implementation status of activities for the current year is as follows: 1. Compiled board meeting agenda and furnished sufficient materials to send with notices to relevant parties for 2. Invited CPAs to present audit reports or related content every half fiscal year. 3. Organized preregistration for shareholder meeting dates, prepared notices, agenda, and minutes, and published 4. Organized tailored training courses as required by directors (12 hours completed in 2021)
No
Yes V V V V V V V V V V
Assessment Item
I. Are corporate governance principles as per Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies established and disclosed? II. Shareholding structure and shareholder equity (I) Internal operating procedures established and implemented to handle shareholders’ suggestions, concerns, disputes, or litigation matters? (II) Is there a roster of major shareholders with controlling power and persons with ultimate control over them? (III) Risk management and firewall systems with affiliates established and implemented? (IV) Internal rules prohibiting insider trading on undisclosed information established? III. Composition and responsibilities of Board of Directors (I) A diversity policy and set management targets formulated and implemented? (II) Other functional committees in addition to remuneration and audit committee set up voluntarily? (III) Evaluation rules and methods on annual performance established with results reported back as reference for individual directors’ remuneration and renewal? (IV) Are CPAs’ independence regularly evaluated? IV. Competent and appropriate corporate governance personnel and officers appointed to furnish execution information for directors, assist directors, and supervisors, handle board and shareholder meeting matters, as well as record meeting minutes in legal compliance?
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Deviations from Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies None Not applicable None None None None
3 2 3 2 3 4
Hours
Course
Explanation
Preventing Internal Threats: Analysis of Corporate Internal Investigations Conference on the Promotion of Sustainable Development Roadmaps and Industry Themes How does the audit committee supervise the effectiveness of internal controls? Climate change impacts and global carbon risk management trends Exploring AI development prospects arising from software and hardware integration; Web3+ES digital marketing trends Analysis of the global political and economic scene in 2023; Solutions for companies to achieve net zero emissions: Natural carbon sinks and carbon trading
Implementation Status
Organizer Taiwan Corporate Governance Association Taiwan Stock Exchange Corporation Taiwan Corporate Governance Association Taiwan Corporate Governance Association Taiwan Corporate Governance Association Taiwan Corporate Governance Association 29
Date 2022 2022 2022 2022
Corporate Governance Association to conduct board performance evaluations in May 2022 with annual self- assessments in December. June 21, July 27, August 26, September 16, 2022 October 27, December 27, 2022 We disclose information on corporate governance, green manufacturing, stakeholders, and relevant operational rules on our website: https://www.winbond.com/hq/about-winbond/csr-new/policy Continuing education of directors: We arrange continuing education courses for directors every year, and regularly provide directors with information on professional courses offered by external institutions. Continuing education courses attended by directors and supervisors can be found in the Corporate Governance section of the MOPS website.
5. Pursuant to the Rules for Directors’ Remuneration and Board Performance Evaluations, we have authorized Taiwan An effective communication channel with stakeholders is maintained with a section set up on the official website to address important corporate and social responsibility issues that stakeholders are concerned about. An office that handles shareholder services is available. (I) Financial status, operations, and corporate governance information are periodically (monthly/quarterly/annually) disclosed on the official website. (II) Material information is collected and disclosed by the Investor Relations Department as per Spokesperson and Deputy Spokesperson Rules. Information about investor conferences is posted on the official website and is available in 4 different languages—Traditional Chinese, Simplified Chinese, English, and Japanese—to facilitate public understanding. (III) Annual financial statements are announced and reported within 2 months of the end of the fiscal year along with the first, second, and third quarter financial statements as well as monthly operating status before the prescribed deadline. 1. 2. 3. Attendance records of directors: Please see p. 21 of this report for the operations of the Board of Directors.
No V
Yes V V V V V
Assessment Item
V. Means of communication with stakeholders (shareholders, employees, clients, suppliers, etc.) established or a Stakeholders Section created on the official website? Important corporate and social responsibility issues that stakeholders are concerned about addressed? VI. A professional agency hired to handle tasks and issues related to shareholder meetings? VII. Information Disclosure (I) A corporate website established to disclose information on financial, business, and corporate governance status? (II) Other information disclosure channels (an English website maintained, staff designated to collect and disclose information, spokespersons appointed, investor conferences broadcasted, etc.) established? (III) Annual financial statements announced and reported within 2 months after the end of the fiscal year along with first, second, and third quarter financial statements as well as monthly operating status before deadlines? VIII. Other information disclosed to facilitate a better understanding of corporate governance operations (employee rights and wellness, investor and supplier relations, stakeholder rights, director and supervisor training records, customer /risk management policy implementation and evaluation measures, and insurance purchases for directors and supervisors)?
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Implementation Status Deviations from	Assessment Item Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies Yes No Explanation	4. Purchase of liability insurance for directors: We have purchased liability insurance starting in 2015. Please refer to the Corporate Governance section of the MOPS website.	IX. Describe improvement in response to corporate governance evaluation results published by the TWSE Corporate Governance Center in the most recent year, items prioritized, and future measures. Over the years, we have been ranked among the top 20% of TWSE-listed companies in terms of corporate governance, and it will continue to enhance corporate governance.

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Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and Reasons None None
Summary
Implementation status
31
Formulation of corporate sustainability policies and related management guidelines Formulation of short-, medium-, and long-term strategies and goals for sustainable development Review, tracking, and revision of implementation status and effectiveness of corporate sustainable development Regular annual reports of the Committee’s implementation results to the Board of Directors. We have obtained ISO14001 eco-management system certification and implement internal audits every 6 months under the internal standard B0000-2511 Environmental Safety and Health Management System audit procedures. An international verification company
In 2015, the Company established the Winbond CSR Implementation Committee as its central governing unit to promote sustainable development. As a part of its continuing effort to develop and improve the Company, Winbond restructured the original CSR Implementation Committee into Sustainability Development Committee (ESG Committee) in May 2022, raising the level of the Committee to that of the Board of Directors. The Committee is composed of several directors and five to seven executive managers from relevant departments, including the President. The Committee convenes at least twice a year, and the Chair of the Board serves as ex-officio member and chair of the Committee. The term of office for directors on the Committee is the same as that of the Board of Directors. The purpose of the Committee is to plan the Company’s sustainable development strategies and goals, formulate corresponding action plans, consolidate the Company’s resources, implement sustainability practices, and ultimately, enhance operational competitiveness. Under the ESG Committee, we established the ESG Office and five functional task forces focusing on the areas of Environmental Sustainability, Green Products, Human Rights and Social Inclusion, Sustainable Supply Chain, and Corporate Governance. The Committee presents quarterly reports on the progress of the greenhouse gas inventory as well as regular reports on the Committee’s implementation results to the Board of Directors each year to ensure the promotion and implementation of corporate sustainable development initiatives. The duties of the ESG Committee include the following four items:     In addition, to ensure oversight by the Board of Directors, the Company holds a regular meeting in the fourth quarter of each year (the most recent meeting was held on November 3, 2022) in which the Board of Directors listens to a report by the President concerning sustainability issues and progress. This enables the Board of Directors to keep track of the implementation status of various business units within the Company, review the formulation and progress of corporate strategies, and require the management team to make adjustments when necessary. For more information, please refer to the ESG pages of the official Winbond website. (https://www.winbond.com/hq/about-winbond/csr-new/policy/?__locale=en) Under the Materiality Principle, we conduct risk assessments of environmental, social, and corporate governance issues of material interest to the Taiwan head office based on a sound corporate social responsibility policy and sustainable development best practice principles, formulate relevant policies, systems, and management guidelines with concrete implementation plans, and discloses them in the corporate sustainability report and on our website. In addition, we focus on key issues involving various aspects of ESG, assess risks and opportunities related to corporate sustainability, incorporate ESG issues into corporate strategic planning, operations management, and decision-making processes, and implement corporate social responsibility to achieve sustainable corporate development. (I)
No
Yes
V V V
Promotion item
Winbond conduct risk assessments
I. Has Winbond established a governance structure that promotes sustainable development, created a full-time (part- time) entity to promote sustainable development and authorized senior management to manage it, and established board oversight? (TWSE/TPEx Listed Companies must report the status of implementation, not compliance or explanation.) II. Does on environmental, social, and corporate governance issues related to operations under the Materiality Principle, and formulate relevant risk management policies and strategies? (TWSE/TPEx Listed Companies must report the implementation status, not compliance or explanation.) III. Environmental Issues
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None None None None	`32`
performs external audits every year to ensure that the system is operating normally (verification agency: DQS Inc.; effective dates: August 12, 2022~August 11, 2025; coverage: Central Taiwan Science Park site at No. 8, Keya 1st Road, Daya District, Taichung City. Verification Agency: DQS Inc.; effective dates: November 4, 2022 ~ November 5, 2025; coverage: Kaohsiung site at No. 35, Luke 5th Road, Kaohsiung City). (II) To improve energy efficiency, we set key performance indicators (KPI) for the utilization rate of various major sources of energy such as water and electricity, and formulate annual goals and implement management plans to continuously improve water and electricity consumption, reduce waste output, and increase the waste reuse rate. The president personally reviews the implementation results and targets achievements on a quarterly basis. Recycling systems are considered in the plant design phase with priority given to the recovery and reuse of wastewater, waste heat, and solid waste generated during plant operations, thereby reducing resource consumption and environmental impacts. In 2022, it was estimated that water consumption per unit product was 134 liters/layer (layer-wafer mask) and that the plant-wide water recovery rate was approximately 80.5%, which met the self-imposed target value. The maximum water consumption per unit of product was 145 liters/layer, and the minimum plant-wide water recovery rate was 80%. In addition to regulatory compliance, we strive to maximize the impact of every drop of water and decrease effluent discharge. The energy-saving and carbon-reduction measures adopted in 2022 reduced CO2e emissions by 250,770 metric tons, equal to the annual carbon sequestration of 650 Daan Forest Parks (calculation based on an annual carbon dioxide absorption of 386 metric tons by Daan Forest Park). Greenhouse gas emissions/unit product in 2022 came to 13.2 kg CO2e/layer (layer-wafer mask), which met the self-imposed target value of a reduction from the emissions/unit product figures of 2020 (13.3 kg CO2e/layer). With regard to the future development of advanced technologies and capacity expansion, we will continue to promote carbon reduction plans and increase energy efficiency to reduce impacts on the environment. As a part of our ongoing effort to promote waste recycling and reuse, we have adopted reductions in the use of process chemicals, extended the chemical usage cycle, and replaced parts and components to reduce waste generation, and has made improvements to waste recycling through better waste collection and sorting. In 2022, we achieved 90.1% waste recycling, surpassing the self-imposed target of 90% or more. (III) We are aware of the impact of climate change brought about on the environment and business operations by the greenhouse effect. Aside from undertaking management programs to reduce the consumption of water, electricity, and raw materials, and reducing waste generation to achieve KPI targets, we have participated in the PFC emissions reduction programs advocated by the Taiwan Semiconductor Industry Association and World Semiconductor Council since 2000. Through process adjustment and the use of alternative fuels as well as the installation of PFC reduction equipment, we have been able to reduce greenhouse gas emissions. The PFC emissions reduction results over the years have been validated by an international certification body. We have also been named a "Company with Outstanding Performance in Voluntary Reduction of Greenhouse Gas Emissions" by the Industrial Development Bureau, MOEA. In addition, we perform a greenhouse gas inventory every year as a reference for formulating energy conservation and greenhouse gas emissions reduction strategies, register the results on the Environmental Protection Administration’s Taiwan National Greenhouse Gas (GHG) Registry, and disclose the relevant data in the CSR section website. We introduced the framework of Climate-Related Financial Disclosures, (TCFD) in 2020, which was further strengthened in 2021. Employees from the 5 functional groups (eco-sustainability, green products, human rights and social inclusion, sustainable supply chain, and corporate governance) under the Sustainability Development Committee (ESG Committee) formed a cross-departmental TCFD task force to gain a more comprehensive understanding of the potential positive and negative impacts of climate change on business operations. The TCFD task force is responsible for identifying and assessing risks and opportunities associated with climate change on an annual basis, assisting in the development of relevant quantitative methods and indicators, and establishing an internal climate risk management mechanism. In 2022, there were over 40 members on the TCFD task force, over 60% of whom were department supervisors or higher, and 4 workshops were held to communicate and discuss climate change issues as they relate to the relevant business sectors. Under the TCFD framework and procedural requirements, we have identified primary and secondary climate risks and opportunities while simultaneously formulating effective response strategies through a comprehensive risk management mechanism to strengthen the responses to and practices involving climate change events. For details, please refer to the Sustainability Report. (IV) The eco-protection policy focuses on compliance with the latest international environmental standards and other regulations; consistent improvement, effective eco-protection, the reduction of environmental risks, and the adoption of optimized preventive and improvement measures to become a sustainable green business. Inventories of greenhouse gas emissions, water consumption, and total waste w8 are performed every year at the Central Taiwan Science Park site (No. 8, Keya 1st Road, Daya District, Taichung City) and the Kaohsiung site (No. 35, Luke 5th Road, Kaohsiung City: newly added in 2022), and key performance indicators (KPI) such as greenhouse gas emissions, water recycling, and waste recycling per unit product are formulated. The greenhouse gas emissions are verified annually by a third-party organization (ISO 14064-1), while water consumption and waste production are self-assessed. In 2022, greenhouse gas emissions totaled approximately 394,677 metric tons of CO2e (direct emissions = 44,034 metric tons of CO2e and indirect emissions =

V V V
(I) Has Winbond established a suitable eco- management system that meets the needs of particular industrial characteristics? (II) Is Winbond committed to improving energy efficiency and using recycled materials with low impact on the environment? (III) Has Winbond assessed the current and future risks and opportunities posed by climate change and taken appropriate action? (IV) Has Winbond calculated greenhouse gas emissions, water consumption, and total waste w8 over the past 2 years, and formulated policies for reducing greenhouse gas emissions, water

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consumption, and other waste management? 350,643 metric tons of CO2e), water consumption totaled approximately 4,131,340 cubic meters, and the total w8 of waste was approximately 9,584 metric tons (4,608 metric tons of hazardous substances and 4,976 metric tons of nonhazardous substances). In 2021, total greenhouse gas emissions were approximately 316,044 metric tons of CO2e (direct emissions = 38,760 metric tons of CO2e and indirect emissions = 277,284 metric tons of CO2e), water consumption totaled approximately 3,292,825 cubic meters, and the total w8 of waste was approximately 7,727 metric tons (3,509 metric tons of harmful substances and 4,218 metric tons of non-hazardous substances). In 2022, greenhouse gas emissions per unit product (layer-wafer mask) totaled 13.2 kg CO2e/layer, which met the self-imposed target value of not exceeding 2020’s GHG emissions per unit product (13.3 kg CO2e /layer). Self-assessed greenhouse gas emissions are subject to third-party verification and power coefficient publication. In 2022, water consumption per unit product was approximately 134 liters/layer (layer-wafer mask), and the factory-wide water recovery rate was approximately 80.5%, which met the self-imposed target value of no less than 80%. Water consumption is recorded based on the water meter reading, and the recovery rate is calculated using the Science Park Administration-mandated water balance chart. The waste recycling rate in 2022 was approximately 90.1%, which met the self-imposed target value of over 90%. The volume of waste output is the declared value stipulated in the Waste Disposal Act, while the volume of recycling is calculated after being classified by waste disposal method.	None None None None
	(I) We have established CSR policies approved by the board of directors that comply with international human rights standards and the RBA Code of Conduct and abide by the highest ethical standards to protect workers and support human rights, such as prohibiting all forms of discrimination and respecting freedom of association for employees. The human rights policies are published on our website, and all employees are required to observe the reward and disciplinary measures outlined in our internal regulations. In 2022, we conducted a human rights due diligence investigation and completed the Human Rights Due Diligence Report. We launched both online and physical courses on the employee code of conduct and ethics to strengthen training in and the promotion of labor rights, eco- protection, health and safety, and ethics, as well as to ensure compliance with corporate ethics and government laws and regulations and to improve integrity management. (II) We provide well-established employee benefits. In addition to the statutory benefits (e.g., enrollment in the Labor Insurance Program and the National Health Insurance Program and pension contributions), we provide better-than-industry-average group insurance, childcare allowance, marriage and childbirth allowances, and a wellness leave system. A wide range of employee benefits are in place to provide for our employees and their families. Furthermore, the Articles of Incorporation require that not less than 1% of the pre-tax earnings before deducting employee and director remuneration be allocated to employee compensation as a means to ensure that employee compensation reflects business operations performance. (III) We have obtained ISO45001 Occupational Health and Safety Management System and CNS45001 Taiwan Occupational Safety and Health Management System certifications (certified by DQS Inc., certificate registration nos. 20003544 OHS18 and 50600484 OHS18) and undertake internal audits every 6 months, while annual external audits are conducted by an international certification body to ensure normal system operations. We rigorously observe the government's safety and health regulations and perform associated management tasks, including carrying out safety and health risk assessments, drafting and executing safety and health regulations, and implementing employee safety, sanitation, and health training courses annually. (IV) We have built a sound learning environment based on education and training management procedures, and provide appropriate training resources to supervisors and colleagues at all levels based on a range of learning methods and resources: 1. We design management development training activities for management-level employees following the management function blueprint. These activities include courses to help front-line supervisors develop appropriate management thinking and improve their management skills as well as experience-sharing sessions for internal supervisors to exchange work experience. In addition, authorities from industry, the government, and academia are invited to give presentations on various topics. Through a variety of training activities, the management skills of managers at all levels undergo continual improvement.

	V V V V
	IV. Social Issues (I) Does Winbond have adequate management policies and procedures in place according to applicable laws and regulations and international conventions on human rights? (II) Does Winbond develop and implement reasonable employee benefits (including compensation, leave, and other benefits), and does employee compensation adequately reflect business performance and results? (III) Does Winbond provide a safe and healthy work environment and organize regular health and safety training for employees? (IV) Does Winbond have effective programs in place to help employees with career planning and development?

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None None None
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To continuously cultivate the professional skills of employees, professional training is put in place under the functional requirements of each unit. Such training includes courses in R&D design and process testing, international seminars, and experience-sharing sessions with both internal employees and external expert lecturers participating. We offer training courses in work systems and norms, corporate culture, and work adaptation, as well as ESG (Environment Social Governance), CSR (Corporate Social Responsibility), industrial safety, legal infringements in the workplace, and other courses, to maintain a healthy and safe workplace for all employees. In addition to basic education and testing for new recruits, a series of activities such as advanced specialization skills examinations continue to be conducted for the training of direct employees. (https://www.winbond.com/hq/about-winbond/csr-new/sustainable-supply-chain/responsible-business-
2. 3.
Chemicals Regulations (REACH), Restriction of Hazardous Substances Directive (RoHS), halogen-free requirements, and other international standards on customer health and safety. We comply with the Fair Trade Act regarding the marketing and labeling of products and services, as well as the anti-trust code of conduct, the Commodity Labeling Act, the Consumer Protection Act, and other relevant regulations. We also conform with the requirements of the Personal Data Protection Act regarding consumer privacy protections. Consumers who wish to inquire about a product or service can access contact information and a complaint hotline by visiting the stakeholder section of the website. develop supplier management policies and address sustainable development issues. In 2022, Winbond Electronics consolidated existing supplier management policies, including the Responsible Business Alliance (RBA), Hazardous Substance Free (HSF) and traditional supplier management concepts (quality, price, delivery, and process technology capabilities), while incorporating sustainable procurement strategies and ESG sustainability risk assessments/audits into sustainable supply chain management strategy as a response to developments in climate change and global economic and trade risks (e.g., geopolitics). Concerning eco-protection (E), we implemented the "Co-Sustainability" initiative to harness the combined resources of suppliers to implement power and water savings, waste reduction, and greenhouse gas emissions management to promote global eco-sustainability. On the issues of occupational safety and health and labor and human rights (S), the RBA code of conduct is the key to the implementation of a sustainable supply chain. Management measures include the following: First, all suppliers are required to sign the Supplier Code of Conduct Commitment Letter and the Declaration of Non-use of Prohibited Substances; second, under the guidelines of the Responsible Minerals Initiative (RMI) and the Organization for Economic Cooperation and Development (OECD), due diligence investigations are conducted on minerals originating from conflict-affected and high-risk areas, including tantalum, tin, tungsten, gold, cobalt, and mica. Suppliers are required not to purchase and use conflict minerals from unqualified smelters/refineries in conflict areas. Detailed information is published on the website alliance/?__locale=zh_TW). Regarding governance (G), the integrity awareness campaign is implemented twice annually, and suppliers are required to sign a letter of commitment to integrity. To gradually increase the resilience of the entire supply chain, we incorporated an ESG sustainable risk assessment into supplier audit management beginning in 2022. Additionally, we regularly identify sources of risk and impact levels and discuss improvement strategies with suppliers to increase the supply chain's sustainability. In 2022, all suppliers signed the sustainable supply chain commitment and related documents, and their audit results met the requirements. No supplier has been disqualified for major environmental, social, or governance violations.
(V) We strictly adhere to the EU's General Data Protection Regulation (GDPR), Registration, Evaluation, Authorization, and Restriction of (VI) We have created a sustainable supply chain working group under the Sustainability Development Committee (ESG Committee) to The sustainability report is compiled following the core option of the Global Reporting Initiative (GRI) Standards and has been verified by the Taiwan branch of the British Standards Institution (BSI Taiwan) under the AA1000 AccountAbility Principles 2018 Addendum Type Ι Assurance Standard. The content of the sustainability report also complies with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, the United Nations Sustainable Development Goals (SDGs), and ISO 26000 Guidance on social responsibility. The following websites provide CSR information disclosure: Company website: https://www.winbond.com/hq/about-winbond/csr-new/policy/?__locale=zh_TW Sustainability report download: https://www.winbond.com/hq/about-winbond/csr-new/downloads/?__locale=zh_TW TWSE MOPS: http://mops.twse.com.tw
V V V
We have established our Corporate Social Responsibility Principles under the Corporate Social Responsibility Best Practice Principles for TWSE/TPEx Listed Companies and the internal rules, and related implementation does not deviate from the established principles.
(V) Does Winbond comply with applicable laws and international standards regarding customer health and safety, customer privacy, marketing, and labeling of products and services, and has it established appropriate consumer protection policies and complaint procedures? (VI) Does Winbond implement supplier management policies that require suppliers to comply with eco-protection, occupational health and safety, and worker's rights regulations? Describe the implementation status if affirmative. V. Does Winbond prepare reports like the sustainability report that disclose non- financial information under international standards and guidelines? Has a third-party verification organization provided verification or assurance for the disclosure report? VI. Describe the deviations, if any, between actual practice and the corporate social responsibility principles, if we have implemented such principles based on the Corporate Social Responsibility Best Practice Principles for TWSE/TPEx Listed Companies: VII. Other useful information for explaining the status of corporate social responsibility practices:
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The issue of climate change has emerged as one of international concern. In light of the increasing complexity of associated risks, we are committed to a corporate sustainability goal of "becoming a hidden champion	that enriches human life with green semiconductor technology" and are continually developing responsibilities and assets in the environmental, social, and governance (ESG) domains. We introduced the climate change-	related financial disclosure (TCFD) framework in 2020 and strengthened it in 2022 with the publication of the TCFD independent report as a basis for a more accurate assessment of climate-related risks and opportunities,	thereby enhancing operational resilience and insight. Following our participation in the SEMI Semiconductor Industry ESG Sustainability Initiative, we joined the Taiwan Climate Coalition (TCP) in 2022 as a director and	group convener. We actively participate in relevant organizations as part of our efforts to contribute to the environment through industry-academia-government collaborations.	Green sustainability has become an important subject for Taiwanese companies wishing to maintain international competitiveness, and their transition to carbon reduction is imperative. We will continue to formulate	quantifiable performance goals and management approaches to create sustainable competitiveness for end products and services. In addition, the environmental, social, and governance (ESG) practices and achievements	have been recognized by third-party certification bodies.	Sustainability awards and achievements	 In 2021, we won 4 awards in the 2021 Taiwan Corporate Sustainability Awards (TCSA) sponsored by the Taiwan Institute of Sustainable Energy, including consecutively winning the Taiwan Top 50 Corporate	Sustainability Award and the Corporate Sustainability Report Platinum Award, as well as winning the "Talent Development Leadership Award and the Growth Through Innovation Leadership Award for the first	time. In 2022, we won 3 major awards, including the Taiwan Top 100 Sustainable Enterprise Award and consecutive wins for the Taiwan Top 50 Corporate Sustainability Award and the Corporate Sustainability	Report Platinum Award.	Ranked in the Top 6-20% of Companies in the TWSE's 8th Corporate Governance Evaluation	Inclusion in the TWSE Corporate Governance 100 Index and TWSE RAFI® Taiwan High Compensation 100 Index in 2022	Inclusion in FTSE4Good Emerging Index and FTSE4Good TIP Taiwan ESG Index	Won 2 golden awards and 2 silver awards at the Taiwan Continuous Improvement Awards	Winbond TrustME® W77Q won the OFweek China IoT Innovative Product Awards 2022 and received SESIP level-2 certification	Winbond HYPERRAM™ 3.0 won the 7thChina IoT Industry Technology Innovation Award	Acquired 1000 tons of blue carbon CO2e from the Singapore-based CIX- Delta Blue Carbon Project	Zero Carbon Family Day (carbon offset of 194 tons of CO2e with the Zero Carbon Day event on November 12, 2022)	Official sponsor of Houfeng Bike Trail	Certifications and qualifications:	ISO 9001 Quality management system	ISO 14001 Environmental management system	ISO 45001 Occupational health and safety management system	ISO 14064-1 Greenhouse gas verification statement, reasonable assurance	ISO 14067 Greenhouse gases — Carbon footprint of products	ISO 50001 Energy management	IATF 16949 Automotive production and relevant service management system	QC 080000 Hazardous substance management system certification	ISO 26262 Certification for functional safety of road vehicles	ISO/SAE 21434 Road vehicles — Cybersecurity engineering	Our long-term CSR commitments include "Care for the Disadvantaged, Care about Eco-Sustainability, and Fulfill Corporate Social Responsibility." we leverage our core strengths to put our beliefs in community care,	public service, and eco-friendliness into action by gathering internal resources and the support of employees and putting them to work in the areas of caring for youth and children, assisting disadvantaged groups,	promoting the public interest, and offering academic sponsorships. We promote digitization, create a space for technological innovation and exchange, and participate in community care activities, while also encouraging	employee engagement to highlight the importance of giving back to the community as a leader in corporate social responsibility.	A. Eco-Education and Charity Promotion	We joined the ranks of those who adopt public recreational facilities in 2022 through cooperative efforts with the Taichung City Tourism Bureau to adopt the Houfeng Bike Trail. We are responsible for regular road	cleaning and tree trimming to maintain the beauty and safety of the trail, further demonstrating the spirit of corporate social responsibility and the creation of co-prosperity for the local environment.	In 2022, We invited employees to participate in the "Sports for Public Welfare, Health and Love for the Earth" event. Our employees burned a total of 2,422,660 calories in their daily exercise, which was converted into	a donation of NT$605,655 to the Wilderness Conservation Association for the protection of streams and other environmental conservation activities in 2023.	B. Assisting the Disadvantaged	Fundraising for impoverished school children: We have collaborated with the Taiwan Fund for Children and Families since 2017 to provide young students from economically disadvantaged families with educational	resources and a steady school education. We encourage our employees to participate in the fundraising program with enthusiasm and heartfelt care. In 2022, 1,052 employees donated a total of NT$ 4.128 million,	providing a full year of support for 1,032 elementary school students.	We sponsored the charity organizations that participated in the 2022 STSP Love Month Picnic, assisting approximately 3,500 individuals in 1,000 disadvantaged families in Shanhua, Shanhua, and Anding, 3 districts	located near STSP.

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Implementation Status Deviations from	Assessment Item Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies Yes No Description	I. Establishment of ethical corporate management policy and approaches (I) Board-approved ethical corporate management policy clearly stated in regulations and external correspondence with commitment to enforcing such policy? (II) Risk assessment mechanism for unethical conduct with regular evaluation of higher-risk business activities? Program to prevent unethical conduct formulated whose scope at least matches that prescribed in Article 7, Paragraph 2 of the Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies? (III) Program of operations, code of conduct, disciplinary actions, and appeal procedures detailed and duly, effectively enforced to prevent unethical conduct, with periodic review and revision? V V V (I) To ensure ethical business management, we have formulated the Ethical Corporate Management Best Practice Principles, which have been approved by the board of directors. Customers are served with integrity and good faith while employees are rigorously required to practice self-discipline and observe internal rules to establish good corporate governance, risk management, and a sustainable business environment. (II) Procedures for higher-risk operations and activities have been established. These include the Procedures for the Acquisition and Disposal of Assets, the Rules for Endorsements and Guarantees, Procedures for Lending Funds to Other Parties, the Procedures for Transactions with Group Enterprises, Specific Companies, and Related Parties, and the Donation Rules, all of which conform to regulations governing transactions with related parties to prevent unethical conduct. (III) To prevent unethical conduct, we have established the Rules for Conflict-of-Interest Reporting and Recusal, the Procedures for Insider Trading Prevention, the Rules for Reporting Private Financial Transactions between Employees in Specific Positions and Personnel and Suppliers in Related Businesses, the Rules on Accepting and Providing Gifts and Entertainment, the Technical and Classified Data Management Rules, and the Anti-Trust Code of Conduct. The Rules for Handling Ethical Management Violations detail methods and channels for filing complaints, and are regularly promoted, implemented, and reviewed, with disciplinary action taken in the event of a violation. None None None	None None None None
			(I) All suppliers are required to sign a commitment to integrity statement before commencing dealings. (II) The Department of Human Resources formulates, promotes, and enforces ethical management rules including the Corporate Governance Best Practice Principles, the Ethical Corporate Management Best Practice Principles, the Corporate Social Responsibility Best Practice Principles, the Procedures for Corporate Social Responsibility Management, the Code of Ethics for Directors, and the Employee Code of Conduct. All directors and employees receive annual training to ensure implementation, with results reported by the President to the Board of Directors every fourth quarter. (III) The Ethical Corporate Management Best Practice Principles and the Rules for Conflict-of-Interest Reporting and Recusal both specify a code of conduct for employees, and an adequate whistleblowing channel and regular training have been established. Internal rules and regulations are published on the Intranet to keep all informed of any amendments, with regular education held on insider trading to prevent inadvertent violations of the law. (IV) Effective accounting and internal control systems have been established, and relevant operating procedures are reviewed and revised as necessary or required by law. Self-evaluations of executive officers, internal units, subsidiaries, and the internal auditing unit are made and reported at least annually. The board-approved annual audit plan is faithfully conducted. The chief auditor submits completed (or follow-up) reports to independent directors for review and periodically reports implementation status and internal control self-evaluation results to the Audit Committee and Board of Directors. (V) We place a high value on ethical management and corporate social responsibility. The Department of Human Resources reports to the Board of Directors on the implementation results of annual ethical management awareness campaigns and training every fourth quarter. Efforts to promote and educate
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			V V V V V
			II. Ethical corporate management (I) Ethics records of affiliates assessed; business conduct and ethics clauses included in contracts? (II) A unit set up under the Board of Directors to promote ethical corporate management with regular (at least annual) reports monitoring the implementation of policies and programs to prevent unethical conduct? (III) Policies established to prevent conflicts of interest with appropriate communication channels for proper implementation? (IV) Effective accounting and internal control systems in place to enforce ethical management? Internal auditing unit draws up plans based on assessment results of risks of involvement in unethical conduct, and investigates compliance with prevention programs or engages a CPA to execute audits? (V) Regular internal and external educational training on ethical management?

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Implementation Status Deviations from	Assessment Item Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies Yes No Description	about employee rights, eco-protection, health, safety, ethics, and prevention of insider trading have been ramped up to ensure compliance with corporate ethics requirements and government regulations as well as facilitate sound, ethical management. In 2021, 3,377 employees took a total of 1,350 recorded hours of training courses in ethical management and corporate social responsibility, with a 100% completion rate among all directors and employees. None	III. Whistleblowing system (I) A whistleblowing and reward system established with an accessible reporting channel and dedicated personnel appointed to liaise with accused individuals? (II) Standard operating procedures in place for investigative reports and follow-up action with strict confidentiality measures? (III) Measures taken to protect whistleblowers from retaliation? V V V (I) Several different reporting and complaint channels have been set up, and employees are kept informed of email, suggestion box, and grievance channels as well as reward and disciplinary measures. All are reviewed and revised regularly to achieve effective and adequate workplace communication as well as rapid and effective solutions. (II) Operating procedures for investigative reports and confidentiality measures are in place to form the basis of investigations. (III) The identities of whistleblowers are kept confidential to protect them from retaliation. None None None	IV. Information Disclosure Guidelines on business ethics and implementation disclosed on the official website and the Market Observation Post System (MOPS)? V Ethical Corporate Management Best Practice Principles are publicly accessible on the official website: https://www.winbond.com/hq/about-winbond/investor/compliance None	V. Describe any differences between actual practice and principles based on Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies: Our Ethical Corporate Management Best Practice Principles were formulated under the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and internal rules and regulations, and there have been no deviations in implementation.	VI. Other important information to facilitate a better understanding of ethical management operations: We keep abreast of the development of ethical management rules and regulations in Taiwan and overseas through policy reviews to improve performance.	7. Disclose methods to access corporate governance principles and relevant guidelines: Our corporate governance principles can be accessed under “Investor Services/Rules and Regulations” on the official website. 8. Other significant information that may improve understanding of Winbond’s corporate governance and implementation: Please refer to the official website at https://www.winbond.com

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Implementation of Internal Control System

9.1 Internal Control System Statement

Winbond Electronics Corporation Statement of Internal Control System

Date: February 16, 2023

Based on the findings of the Company's self-assessment of its internal control system in 2022, Winbond Electronics Corporation hereby declares:

Winbond recognizes that the Board of Directors and management are responsible for establishing, implementing, and maintaining its internal control system and has designed such a system to provide reasonable assurance of operational effectiveness and efficiency (profitability, performance and safeguarding of assets), reliability, timeliness, reporting transparency, and compliance with applicable rulings, laws, and regulations.
Despite a perfect design, an effective internal control system has inherent limitations with only reasonable assurance of accomplishing the 3 aforesaid objectives and may be subject to change due to the environment and extenuating circumstances beyond our control. Nevertheless, Winbond takes immediate remedial action in response to any identified deficiencies with self-monitoring mechanisms.
Winbond evaluates the design and operational effectiveness of its internal control system based on criteria as per the Regulations Governing Establishment of Internal Control Systems by Public Companies (the Regulations) with 5 key components identified along with several items: (1) control environment, (2) risk assessment, (3) control activities, (4) information and communication, and (5) monitoring activities.
Winbond has evaluated the design and operational effectiveness of its internal control system according to the aforesaid criteria.
Based on evaluation results, Winbond believes that as of December 31, 2022, its internal control system (including the oversight and management of subsidiaries) is effectively designed and operationally effective, and offers reasonable assurance that our Board of Directors and management understand the degree to which the Company has achieved its operational effectiveness and efficiency objectives, that the reports are reliable, timely, and transparent, and that they comply with applicable rules, laws, regulations, and bylaws.
This Statement is an integral part of Winbond’s annual report and prospectus. If the above disclosed contents involve any falsehoods, concealment, or other illegality, legal liability will be entailed under Articles 20, 32, 171, and 174 of the Securities and Exchange Act.
This Statement was passed by the Board of Directors in their meeting held on February 16, 2023, with none of the 11 attending directors expressing dissenting opinions, and the remainder all affirming its contents.

Winbond Electronics Corporation

Chairman: Arthur Yu-Cheng Chiao

President: James Pei-Ming Chen

9.2 Disclose the CPA’s review report on internal control system: None.

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Personnel or disciplinary penalties imposed on violators of internal control system regulations or major deficiencies with improvement status in the past year and up to the date of report: None
Important resolutions adopted in shareholder and board meeting(s) in the past year and up to the date of report
11.1 Report on the implementation of resolutions passed at Shareholders Meeting of 2022
Subject matter: Approval of Business Report and Financial Statements for 2021 Resolution: Passed (For detailed information, please refer to the Market Observation Post System.) Implementation: Has been implemented in accordance with the resolution
Subject matter: Approval of Distribution of Earnings for 2021 Resolution: Passed (For detailed information, please refer to the Market Observation Post System.) Implementation: Has been implemented in accordance with the resolution.
Note: The cash dividend is NT$1 per share. The ex-dividend date for Company stocks is June 22, 2022, and the distribution date is July 7, 2022.
Subject matter: Discussion on Amendment to the Articles of Incorporation
Resolution: Passed (For detailed information, please refer to the Market Observation Post System.) Implementation: Processing relevant work in accordance with the amended Articles of Incorporation
Subject matter: Discussion on Amendment to the company regulations
(1) Procedures on Asset Acquisition or Disposition
(2) Rules of Procedure for Shareholders Meetings
Resolution: Passed (For detailed information, please refer to the Market Observation Post System.) Implementation: Has been published on the Market Observation Post System; processing relevant work according to the amended company regulations
Subject matter: Discussion on Removal of Non-Compete Clause for Directors Resolution: Passed (For detailed information, please refer to the Market Observation Post System.) Implementation: Has been implemented in accordance with the resolution

11.2 Significant Resolutions of the Board Meetings for 2022 and up to March 16, 2023:

Significant Resolutions	of the Board Meetings for 2022 and up to March 16, 2023:
Date	Summaryof Significant Resolutions
February 11, 2022	1. Approval of Business Report and Financial Statements for 2021 2. Approval of Consolidated Business Reports, Consolidated Financial Statements of Affiliated Enterprises, and Affiliation Reports for 2021 3. Approval of Statement of Internal Control System for 2021 4. Approval of Business Plan and Operating Budget for 2022 5. Approval of Increase in Capital Expenditure Budget 6. Approval of Appointment and the Annual Remuneration of Deloitte & Touche 7. Approval of Purchase of Liability Insurance for Directors, Supervisors, and Key Officers 8. Approval of Engagement in Derivative Financial Instrument Transactions 9. Approval of Acquisition of Short-Term Comprehensive Credit Line from Financial Institutions
March 15, 2022	1. Approval of Distribution of Earnings for 2021 2. Approval of Acquisition of 3 Units in Langjing Project in Lingya District, Kaohsiung City 3. Approval of Amendment to the_Articles of Incorporation_ 4. Approval of Amendment to the_Procedures for Asset Acquisition or Disposition_ 5. Approval of Removal of Non-Compete Clause for Directors 6. Approval of Scheduling of Annual Shareholder General Meeting for 2022 7. Approval of Amendment to the_Organizational Regulations of the Audit Committee_ 8. Approval of Amendment to the_Internal Rules and Regulations_ 9. Approval of Engaging in Derivative Financial Instrument Transactions. 10. Approval of Individual Director Remuneration for 2021 for the 12th Board of Directors 11. Approval of Individual Remuneration for 2022 for the 12th Board of Directors 12. Approval of Disbursement of Managerial Remuneration 13. Approval of Individual Managerial Remuneration for 2022 14. Approval of Remuneration for Manager Mr. Arthur Yu-Cheng Chiao 15. Approval of Amendment to the Rules of Procedure for Shareholders Meetings
May 5, 2022	1. Approval of Consolidated Financial Statements for the First Quarter of 2022 2. Approval of Increase in Capital Expenditure Budget 3. Approval of Sale of 30% Ownership in Land in Baoshan Township, Hsinchu County to Theaceae Conservation Corporation 4. Approval of Establishment of the Sustainability Development Committee and Adoption of the Organizational Regulations of the Sustainability Development Committee 5. Approval of Amendment to the Internal Control System of Stock Affairs Units 6. Approval of Amendment to Internal Rules and Regulations

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Date Summary of Significant Resolutions
7. Approval of Engagement in Derivative Financial Instrument Transactions
8. Approval of Obtaining Short-Term Comprehensive Credit Line from Financial Institutions
9. Approval of Reappointment of Ms. Jessica Huang as Advisor to the Company while continuing to serve as
Chief Financial Officer
May 10, 2022 1. Approval of Investment in CHIA-HO Green Energy Corporation
2. Approval of Engagement in Derivative Financial Instrument Transactions
August 4, 2022 1. Approval of Consolidated Financial Statements for the Second Quarter of 2022
2. Approval of Non-Distribution of Earnings for the First Half of Fiscal Year 2022
3. Participation of Walsin Lihwa Corporation in cash issue for capital increase in 2022
4. Approval of Establishment of Subsidiary through Wholly-Owned Subsidiary Miraxia Edge Technology
Corporation in Japan
5. Approval of Adjustment to Investment Structure in Subsidiaries in Japan and India
6. Approval of Engagement in Derivative Financial Instrument Transactions
7. Approval of Obtaining Short-Term General Credit Line and Derivative Financial Instrument Limit from
Financial Institutions
8. Approval of Appointment of Mr. Jen-Lieh Lin as Vice President of the Company
9. Approval of Resignation of Mr. John Park as Chief Business Officer and Appointment as Chief Strategy
Officer on the same day
November 3, 2022 1. Approval of Consolidated Financial Statements for the Third Quarter of 2022
2. Approval of Increase in Capital Expenditure Budget
3. Approval of Acquisition of Significant Asset (100% Share in Atfields Manufacturing Technology
Corporation)
4. Approval of Engagement in Derivative Financial Instrument Transactions
5. Approval of Obtaining Short-Term General Credit Line and Derivative Financial Instrument Limit from
Financial Institutions
6. Approval of Appointment of Mr. Chih-Chung Chou as CFO
7. Approval of Adoption of Contribution Rate of Director Renumeration for 2022
8. Approval of Adoption of Contribution Rate of Employee Renumeration for 2022
9. Approval of Disbursement of Quarterly Managerial Remuneration for 2022
10. Approval of Disbursement of Remuneration to Manager Mr. Arthur Yu-Cheng Chiao for 2022
December 14, 2022 1. Approval of Amendment to the Accounting System
2. Approval of Amendment to the Internal Control System
3. Approval of Formulated Audit Plan for 2023
4. Approval of Liquidation of Wholly-Owned Subsidiary Landmark Group Holdings Ltd. and Pine Capital
Investment Ltd
5. Approval of Amendment and Establishment of the Articles of Incorporation
6. Approval of Engagement in Derivative Financial Instrument Transactions
7. Approval of Obtaining Short-Term General Credit Line and Derivative Financial Instrument Limit from
Financial Institutions
February 16, 2023 1. Approval of Business Report and Financial Statements for 2022
2. Approval of Consolidated Business Reports, Consolidated Financial Statements of Affiliated Enterprises,
and Affiliation Reports for 2022
3. Approval of Statement of Internal Control System for 2022
4. Approval of Business Plan and Operating Budget for 2023
5. Approval of Increase in Capital Expenditure Budget
6. Approval of Renaming Indian Subsidiary GLMTD Technology Private Limited as Winbond Electronics India
Private Limited
7. Approval of Appointment of Deloitte & Touche for Annual Remuneration
8. Approval of Appointment of CFO Mr. Chih-Chung Chou as Corporate Governance Officer
9. Approval of Purchase of Liability Insurance for Directors, Supervisors, and Key Officers
10. Approval of Engagement in Derivative Financial Instrument Transactions
11. Approval of Obtaining Short-Term General Credit Line and Derivative Financial Instrument Limit from
Financial Institutions
March 14, 2023 1. Approval of Distribution of Earnings for 2022
2. Approval of Filing of Syndication Application with Financial Institutions
3. Approval of Annual Shareholder General Meeting Schedule for 2023
4. Approval of Election of Directors (including Independent Directors)
5. Approval of List of Candidates for the Thirteenth Board of Directors (including Independent Directors)
Nominated by the Board of Directors
6. Approval of Removal of Non-Compete Clause for the Thirteenth Board of Directors (including Independent
Directors)
7. Approval of Removal of Non-Compete Clause for Managers
8. Approval of the Review Procedures for Advance Approval of Non-Assurance Services Provided by
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Date Summary of Significant Resolutions
Accounting Firms
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Approval of the List of Pre-Approved Non-Assurance Service Types and Service Lists Provided by Accounting Firms for 2023 10. Approval of Amendment to the Sustainable Development Best Practice Principles 11. Approval of Engagement in Derivative Financial Instrument Transactions 12. Approval of Individual Director Remuneration for 2022 for the 12th Board of Directors 13. Approval of Individual Remuneration for 2022 for the 12th Board of Directors 14. Approval of Disbursement of Managerial Remuneration for 2022 15. Approval of Distribution of Employee Remuneration and Individual Managerial Renumeration for 2022 16. Approval of Individual Managerial Remuneration for 2023 17. Approval of Remuneration for Manager Mr. Arthur Yu-Cheng Chiao
Dissenting or qualified opinion of directors or supervisors opposing important board-approved resolutions recorded or stated in a written statement in the past year and up to the date of report: None
Resignations or dismissals of the chairman, president, chief accounting officer, CFO, chief internal auditor, corporate governance officer, and/or chief R&D officer in the past year and up to the date of report:

				March 16,2023
Title	Name	Arrival Date	Termination Date	Reason for Resignation or Dismissal
CFO	Jessica Huang	April 1,2015	December 1,2022	Reassignment
Corporate Governance Officer	Kun-LungChen	June 17,2020	February16,2023	Reassignment

Handling of material information: The Company handles material information in accordance with rigorous internal procedures made publicly accessible via the Spokesperson and Deputy Spokesperson Rules, with added monthly reminders to all insiders and employees on the Procedures for the Prevention of Insider Trading to prevent violations of relevant regulations.

42 -

V. Certified public accountant’s fee information

The Company paid the following fees to the certified public account, the certified public accountant’s firm, and its affiliates, of which non-audit fees amounted to less than one quarter of audit fees in 2022.

Unit: NT$1,000

==> picture [412 x 31] intentionally omitted <==

----- Start of picture text -----

Name of Name of Non-audit
Audit period Audit fees Total Notes
accounting firm accountant fees
Non-audit services: master file,
----- End of picture text -----

f which non-audit fees amounted to less than one quarter of audit fees in 2022. Unit: NT$1,000	f which non-audit fees amounted to less than one quarter of audit fees in 2022. Unit: NT$1,000	f which non-audit fees amounted to less than one quarter of audit fees in 2022. Unit: NT$1,000	f which non-audit fees amounted to less than one quarter of audit fees in 2022. Unit: NT$1,000	f which non-audit fees amounted to less than one quarter of audit fees in 2022. Unit: NT$1,000	f which non-audit fees amounted to less than one quarter of audit fees in 2022. Unit: NT$1,000	f which non-audit fees amounted to less than one quarter of audit fees in 2022. Unit: NT$1,000
Name of accounting firm Name of accountant Audit period Audit fees Non-audit fees Total Notes
						Non-audit services: master file,
Deloitte & Touche	Kenny Hung, Wen-Yea Shyu	2022.01.01~2022.12.31	10,399	2,880	13,279	Country-by-Country Report, transfer pricing report, tax consulting, non-executive salary reporting and review, ISO consulting and certification fees, and other services.

Change of accounting firm, decrease in amount of paid audit fees after the change of accounting firm compared with that before the change, and the reasons for the decrease: There was no change of accounting firm in 2022.
Amount, percentage, and reasons for a decrease in audit fees of more than 15% from the previous year: There was no decrease in audit fees of more than 15% from the previous year.

VI. Change of accountant: There was no change of accountant in 2022.

VII. Chairperson, president, or manager in charge of financial or accounting matters who worked in the firm of the certified public accountant’s firm or its affiliates in the past year: None

VIII. Changes in the shareholding of directors, managers, and shareholders holding more than 10% of the shares and pledged shares in the past year as of the publication date of the annual report:

Unit: shares

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----- Start of picture text -----

2022 2023 as of March 16
Title Name Increase (decrease) in Increase (decrease) in Increase (decrease) in Increase (decrease)
number of pledged in number of
number of shares held number of shares held
shares held pledged shares held
Chair and CEO Arthur Yu-Cheng Chiao - - - -
Vice Chair and Vice CEO Tung-Yi Chan - - - -
Director Yung Chin - - - -
Independent Director Allen Hsu - - - -
Independent Director Stephen T. Tso - - - -
Independent Director Francis Tsai - - - -
Independent Director Jerry Hsu - - - -
Legal Entity and
Top 10 Walsin Lihwa Corporation - - - -
Director
Shareholder
Representative Fred Pan - - - -
Legal Entity Chin-Xin Investment Co., Ltd. - - - -
Director
Representative Yuan-Mou Su (5,000) - - -
Director Chih-Chen Lin - - - -
Director Wei-Hsin Ma - - - -
President James Pei-Ming Chen 12,481 - - -
Vice President Chin-Fen Tsai (54,000) - - -
Vice President Pei-Lin Pai - - - -
Vice President Hsiang-Yun Fan - - - -
Vice President Wen-Hua Lu (1,155) - - -
Vice President Wen-Chang Hung (14,987) - - -
Vice President (Note 3) Jen-Lieh Lin - - - -
Chief Strategy Officer Eungjoon Park - - - -
Assistant Manager Mao-Hsiang Yan 9,151 - - -
Assistant Manager Hsiu-Han Liao - - - -
CFO and Financial and
Corporate Governance Chih-Chung Chou - - - -
Officer (Note 4)
Accounting Officer Chin-Feng Yang 3,085 - - -
----- End of picture text -----

43 -

==> picture [452 x 92] intentionally omitted <==

Notes:

The above shareholding information is based on actual shareholdings.
The shares were transferred to non-related parties and not pledged.
Mr. Jen-Lieh Lin has served as a manager of the company since October 1, 2022.。
Mr. Chih-Chung Chou has served as a manager of the company since December 1, 2022.
Mr. Cheng-Kung Lin served as the chief information officer of the company until November 14, 2022. The information in the above table only discloses information about his shareholdings until the termination date of his position as the information director of the company.
Ms. Jessica Huang served as CFO of the company until November 30, 2022. The information in the above table only discloses information about her shareholdings until the termination date of her position as CFO of the company.
Mr. Kun-Lung Chen served as the corporate governance officer of the company until February 15, 2023. The information in the above table only discloses information about his shareholdings until the termination date of his position as corporate governance officer of the company.

IX. Information on the top ten shareholders who are related to each other or are spouses or second-degree relatives

==> picture [453 x 409] intentionally omitted <==

----- Start of picture text -----

March 16, 2023; unit: shares
Names and relationships (note 3) of
the top ten shareholders who are
Shares held by the Shares held by spouse, Total shares held in related to other top-ten shareholders Notes
person minor children others’ names or are their spouses or second-degree
Name relatives
Shareholding Shareholding Shareholding
Number of Number of Number
shares percentage shares percentage of shares percentage Name Relationship
(note 1) (note 1) (note 1)
Chin-Xin The chairs of the two
Investment legal entities are
Co., Ltd. second-degree
relatives
Arthur Yu- Second-degree relative
Cheng Chiao of the chair of the legal
entity
Walsin Lihwa Corporation 883,848,423 22.20% - - - - Pai-Yung First-degree relative of -
Hong the chair of the legal
entity
Yu-Lon Chiao The chair of the legal
entity
Yu-Heng Second-degree relative
Chiao to the chair of the legal
entity
Arthur Yu- The two individuals are
Cheng Chiao second-degree
relatives
Pai-Yung The two individuals are
Hong first-degree relatives
Walsin Lihwa Corporation The chairs of the two
(Representative: Yu-Lon 25,694,984 0.65% 1,161,771 0.03% - - Chin-Xin legal entities are -
Chiao)
Investment second-degree
Co., Ltd. relatives
The two individuals are
Yu-Heng second-degree
Chiao relatives
Walsin Lihwa The chairs of the two
Corporation legal entities are
second-degree
relatives
Arthur Yu- The chair of the legal
Cheng Chiao entity
Chin-Xin Investment Co.,
Ltd. 240,003,072 6.03% - - - - Pai-Yung First-degree relative to -
Hong the chair of the legal
entity
Yu-Lon Chiao Second-degree relative
to the chair of the legal
entity
Yu-Heng Second-degree relative
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44
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44 -

==> picture [452 x 626] intentionally omitted <==

----- Start of picture text -----

Chiao to the chair of the legal
entity
Walsin Lihwa Second-degree relative
Corporation to the chair of the
legal entity
Chin-Xin Investment Co., Pai-Yung Hong The two individuals are
Ltd. first-degree relatives
63,472,995 1.59% 11,778,797 0.30% - - Yu-Lon Chiao The two individuals are -
(Representative：Arthur
second-degree
Yu-Cheng Chiao) relatives
Yu-Heng Chiao The two individuals are
second-degree
relatives
Walsin Lihwa Second-degree relative
Corporation to the chair of the
legal entity
Pai-Yung Hong The two individuals are
first-degree relatives
Yu-Lon Chiao The two individuals are
second-degree
Arthur Yu-Cheng Chiao 63,472,995 1.59% 11,778,797 0.30% - - relatives -
Chin-Xin The chair of the legal
Investment Co., entity
Ltd.
Yu-Heng Chiao The two individuals are
second-degree
relatives
Vanguard Emerging
Markets Stock Index Fund Note
41,746,452 1.05% - - - - - -
held by JP Morgan Chase 2
Bank, N.A., Taipei Branch
LGT Bank (Singapore) Ltd.
Investment Fund held by the Standard Chartered 41,540,278 1.04% - - - - - - Note
2
Bank (Taiwan), Main
Branch
Walsin Lihwa First-degree relative of
Corporation the chair of the legal
entity
Arthur Yu- The two individuals are
Cheng Chiao first-degree relatives
Pai-Yung Hong 38,433,771 0.97% - - - - Yu-Lon Chiao The two individuals are -
first-degree relatives
Chin-Xin First-degree relative of
Investment Co., the chair of the legal
Ltd. entity
Yu-Heng Chiao The two individuals are
first-degree relatives
Vanguard Total
International Stock Index
Fund, a series of Vanguard 38,194,469 0.96% - - - - - - Note
Star Funds held by 2
JPMorgan Chase Bank,
N.A., Taipei Branch
Walsin Lihwa Second-degree relative
Corporation of the chair of the legal
entity
Arthur Yu- The two individuals are
Cheng Chiao second-degree
relatives
Yu-Heng Chiao 29,988,748 0.75% 95,567 0.00% - - Pai-Yung Hong The two individuals are -
first-degree relatives
Chin-Xin Second-degree relative
Investment Co., of the chair of the legal
Ltd. entity
Yu-Lon Chiao The two individuals are
second-degree
relatives
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45 -

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----- Start of picture text -----

iShares MSCI Taiwan Index
ETF Investment Fund held
by the Standard Chartered 27,486,000 0.69% - - - - - - Note 2
Bank (Taiwan), Main
Branch
Walsin Lihwa Chair of the legal
Corporation entity
Arthur Yu- The two individuals are
Cheng Chiao second-degree
relatives
Yu-Lon Chiao 25,694,984 0.65% 1,161,771 0.03% - - Pai-Yung Hong The two individuals are -
first-degree relatives
Chin-Xin Second-degree relative
Investment Co., of the chair of the legal
Ltd. entity
Yu-Heng Chiao The two individuals are
second-degree
relatives
Notes:
1. The "shareholding percentage" column was calculated using the total number of issued common stock as of March 16, 2023 (3,980,000,193 shares).
2. The custodian bank cannot provide the final list of ultimate beneficiaries.
3. Relationship disclosure made in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers .
X. Consolidated shareholding percentage
December 31, 2022; unit: shares , 2022; unit: shares 2022; unit: shares ; unit: shares unit: shares
Investment by directors,
managers and businesses
Investment by the Company
that are directly and Consolidated Investment (A+B)
(A)
Invested Business (Note) indirectly controlled by the
Company (B)
Number of Shareholding Number of Shareholding Number of Shareholding
shares percentage (%) shares percentage (%) shares percentage (%)
Winbond International Corporation 87,960,000 100 - - 87,960,000 100
Pine Capital Investment Limited 780,000 100 - - 780,000 100
Landmark Group Holdings Ltd. 5,343,000 100 - - 5,343,000 100
Winbond Electronics (HK) Limited 71,150,000 100 - - 71,150,000 100
Winbond Technology Ltd 100,000 100 - - 100,000 100
Callisto Holdings Limited 40,000,000 100 - - 40,000,000 100
Great Target Development Ltd. 4,470,000 100 - - 4,470,000 100
Winbond Electronics Germany GmbH 850,000 100 - - 850,000 100
Miraxia Edge Technology Corporation 4,000 100 - - 4,000 100
Winbond Electronics Corporation Japan 2,970 100 - - 2,970 100
Nuvoton Technology Corporation 214,954,635 51 6,232,181 1 221,186,816 52
Chin-Xin Investment Co., Ltd 182,840,999 38 194,710,785 40 377,551,784 78
Theaceae Conservation Corporation 24,000,000 30 40,000,000 50 64,000,000 80
----- End of picture text -----

X. Consolidated shareholding percentage

December 31, 2022; unit: shares , 2022; unit: shares 2022; unit: shares ; unit: shares unit: shares

Note: refers to long-term investments over which the Company has significant influence and which are accounted for with the equity method

46 -

Fundraising Status

I. Capital and Shares

(I) Sources of equity

March 16, 2023; unit: shares; NT$

==> picture [454 x 225] intentionally omitted <==

----- Start of picture text -----

Authorized Share Capital Paid-in Capital Note
Use of
Month Issue property
Number of Number of other than Approval date and
and year price Amount Amount Source of equity
shares shares cash to offset document number
payment for
shares
Exercise of employee 2014/02/19 Zhong-
2014.02 10 6,700,000,000 67,000,000,000 3,694,023,193 36,940,231,930 stock options: None Shang-Zi No.
NT$20,560,000 1030003799
Exercise of employee 2014/05/14 Zhong-
2014.05 10 6,700,000,000 67,000,000,000 3,694,466,193 36,944,661,930 stock options: None Shang-Zi No.
NT$4,430,000 1030011345
Exercise of employee 2014/09/18 Zhong-
2014.09 10 6,700,000,000 67,000,000,000 3,694,640,193 36,946,401,930 stock options: None Shang-Zi No.
NT$1,740,000 1030021668
Exercise of employee 2014/11/20 Zhong-
2014.11 10 6,700,000,000 67,000,000,000 3,694,982,193 36,949,821,930 stock options: None Shang-Zi No.
NT$3,420,000 1030026773
Capital reduction by 2015/11/18 Zhong-
2015.11 10 6,700,000,000 67,000,000,000 3,580,000,193 35,800,001,930 treasury stock: None Shang-Zi No.
NT$1,149,820,000 1040028089
2017/12/26 Zhong-
2017.12 10 6,700,000,000 67,000,000,000 3,980,000,193 39,800,001,930 [Follow-on offering: ] None Shang-Zi No.
NT$4,000,000,000
1061000748
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March 16, 2023; unit: share

				March 16,2023;unit: share
Type of		Authorized share capital
shares	Outstandingshares	Unissued shares	Total	Note
Ordinary shares	3,980,000,193	2,719,999,807	6,700,000,000	Listed stocks of the Company

Notes:

Within the total above-mentioned capital amount, a maximum of NT$5 billion in shares with a par value of NT$10 each may be issued through share subscription warrants, preferred share subscriptions, or corporate bonds with warrants to specific creditors, provided that the aggregate total does not exceed 0.5 billion shares and the shares may be issued in installments. The Board of Directors may adjust the quotas for the aforementioned issuances based on capital market conditions and operational needs.
Information on shelf registration to issue corporate bonds: None

(II) Shareholder structure

March 16, 2023

	March 16,2023	March 16,2023	March 16,2023	March 16,2023	March 16,2023	March 16,2023	March 16,2023
Number\ shareholder structure	Government Agencies Financial Institutions Other Legal Entities Personal Foreign Institutions and Foreigners Chinese Investors (Note） Total
Number	6 58 363 280,325 914 5 281,671
Shares held	36,148,582 46,187,639 1,149,828,777 1,716,222,127 1,031,604,692 8,376 3,980,000,193
Shareholding percentage	0.91%	1.16%	28.89%	43.12%	25.92%	0.00%	100.00%

Note: Chinese investors refer to any individual, juristic person, organization, or other institution of the Mainland Area or any company that invests in any third area as stipulated in Article 3 of Measures Governing Investment Permit to the People of Mainland Area and Its Rulings .

(III) Share ownership distribution

1.Common Stock:

==> picture [452 x 97] intentionally omitted <==

----- Start of picture text -----

March 16, 2023; NT$10 per share
Classification Number of shareholders Number of shares held Shareholding percentage (%)
1-999 65,265 16,355,900 0.41
1,000-5,000 163,349 355,496,421 8.93
5,001-10,000 28,489 227,681,803 5.72
10,001-15,000 8,048 102,627,984 2.58
15,001-20,000 5,566 104,116,794 2.62
20,001-30,000 4,188 107,627,985 2.70
30,001-40,000 1,838 66,121,111 1.66
40,001-50,000 1,219 57,128,150 1.44
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47 -

==> picture [451 x 90] intentionally omitted <==

----- Start of picture text -----

Classification Number of shareholders Number of shares held Shareholding percentage (%)
50,001-100,000 1,987 143,507,657 3.61
100,001-200,000 841 118,389,057 2.98
200,001-400,000 374 106,321,908 2.67
400,001-600,000 140 68,947,777 1.73
600,001-800,000 69 48,330,569 1.21
800,001-1,000,000 39 34,788,477 0.87
1,000,001 or more 259 2,422,558,600 60.87
total 281,671 3,980,000,193 100
----- End of picture text -----

2.Preferred stock: Not applicable

(IV) List of major shareholders

Names of the shareholders who hold more than 5% of total shares, along with their shareholding amounts and percentages:

percentages:
		March 16,2023
Name	Number of shares held	Shareholding percentage
Walsin Lihwa Corporation	883,848,423	22.20%
Chin-Xin Investment Co., Ltd	240,003,072	6.03%

For names of the top ten shareholders ranked by shareholding percentage, along with their shareholding amounts and percentages, please refer to pages 43-44.

(V) Stock price, book value, earnings, dividends, and related data for the previous two years

==> picture [445 x 216] intentionally omitted <==

----- Start of picture text -----

Unit: NT$
Item\Year 2021 2022 2023 as of March 16
Highest 38.9 36.45 26.1
Stock price
Lowest 23.75 18.5 19.35
(Note 1)
Average 30.46 27.77 23.46
Book value Before distribution 20.71 23.66 -
per share
After distribution 19.71 22.66 -
(Note 1)
Weighted average number
Earnings of shares (in thousands) 3,980,000 3,980,000 -
per share
Earnings per share 3.42 3.25 -
Cash dividends 1 1 -
From retained
Bonus - - -
Dividends earnings
share
per share From capital
issue - - -
(Note 3) reserve
Accumulated unpaid
dividends - - -
Price/Earnings ratio (Note 4) 8.91 8.54 -
Return on Price/Dividend ratio (Note 5) 30.46 27.77 -
Investment
Cash dividend yield (Note 6) 3.28% 3.60% -
----- End of picture text -----

Notes:

The highest and lowest stock prices of common stock for each year are listed; the average market price for each year is calculated based on the trading volume and value of that year.
The book value per share is calculated based on the number of shares issued at the end of each year and the distribution approved by the board of directors.
The distribution for 2022 is based on the resolution of the board of directors on March 14, 2023.
Price/Earnings ratio = the average closing price per share of the year / the earnings per share of the year.
Price/Dividend ratio = the average closing price per share of the year / the cash dividend per share of the year.
Cash dividend yield = the cash dividend per share / the average closing price per share of the year.

48 -

(VI) Dividend policy and implementation status

1. Dividend policy

Winbond’s dividend policy is described in Articles of Incorporation as follows:

With taxes and accumulated losses deducted, 10% of pre-tax profits at the end of the current year shall be set aside as legal reserve as per applicable laws and regulations unless equal to paid-in capital, after which any remaining balance may be allocated based on orders of competent authorities or business needs as proposed by the Board of Directors in shareholder meeting for a resolution to determine the distribution of bonuses and dividends.

Where earnings, legal reserve, and capital surplus above are to be distributed in cash, the board shall be granted authority to decide a resolution adopted by a majority vote at a meeting attended by over 2/3 of directors with a distribution report presented at the shareholder meeting.

Winbond’s dividend distribution policy conforms to the Company Act and Articles of Incorporation with due consideration to capital and financial structure, operating status, retained earnings, industry characteristics, and the economic cycle. For future operational scale and cash flow, no less than 30% of current year’s net profit after tax with losses, legal and special reserves deducted shall be distributed conservatively to shareholders either as stock (no less than NT$0.1 per share) or cash dividend (no less than 50% of total) to promote corporate sustainability.

Earnings may be distributed or losses made up at the end of each half of a fiscal year. Statements and proposals set forth in Article 21 herein shall be prepared and resolved by the Board of Directors.

Employees’ and directors’ remuneration and taxes payable shall be estimated and reserved in distributing earnings with losses and legal reserve set aside unless equal to paid-in capital. Cash dividends shall be resolved by the Board of Directors while newly issued shares shall be resolved by the shareholder meeting.

Pursuant to Article 240 of the Company Act and the Company's Articles of Incorporation, the Company’s Board of Directors resolved on March 14, 2023 to distribute cash dividends of NT$3,980,000,193 for 2022, with a dividend of NT$1 per share of common stock. In the event that the Company repurchases shares or if a situation that affects the number of outstanding shares arises, the Chair is authorized to adjust the amount payable per share according to the actual number of outstanding shares as of the ex-dividend date. The calculation of the cash dividend payment is made to the nearest whole number (with amounts below NT$1 being rounded down) and any fractional shares resulting from the dividend payment are included in the Company's other income. (Note: There was no distribution of earnings in the first half of 2022.)

(VII) Impact of stock dividend issuance on the Company's business performance and EPS: Not applicable

(VIII) Employee and director remuneration

The percentage or range of employee and director remuneration as stipulated in the Company's Articles of Incorporation is as follows:

Prior to deducting employee and director remuneration for the year, the Company shall set aside not less than 1% of the pre-tax net profit for director remuneration and not less than 1% for employee remuneration, to be distributed to employees in the form of stock or cash as determined by the Board of Directors. Proposals for the distribution of employee and director remuneration shall be reported to the Shareholders Meeting. However, if the Company has accumulated losses, the amount necessary for offsetting such losses shall be reserved in advance, after which employees' and directors' remuneration shall be distributed in the aforementioned proportions.

The basis for estimating the amount of employee and director profit-sharing remuneration and calculating the number of shares or cash to be distributed as employee profit-sharing remuneration, and the accounting treatment of discrepancies between the actual distributed amounts and the estimated figures:

In accordance with Article 22 of the Company's Articles of Incorporation, and based on the audited profits for 2022, the Board of Directors has approved the allocation of 1% of the net profit, totaling NT$153,939,912, to be distributed as director remuneration and 2%, or NT$307,879,824, to be distributed as employee remuneration. All amounts will be paid in cash. The allocation percentages and amounts have been approved by the Company's Compensation Committee and the Board of Directors. If there are any changes to the allocated amounts after the release of the annual consolidated financial statements, the adjustments will be estimated based on accounting standards and recorded in the next year.

49 -
Remuneration distribution approved by the Board of Directors:
(1) Shares or cash to be distributed as employee and director profit-sharing remuneration. If there is any discrepancy between the actual distributed amount and the estimated figure, the amount of the discrepancy, the cause, and how it is treated shall be disclosed:

==> picture [404 x 94] intentionally omitted <==

----- Start of picture text -----

Year: 2022 Unit: shares; NT$
If there is any discrepancy between the
Director profit- actual distributed amount and the
Employee profit-sharing remuneration sharing recognized employee or director profit-
remuneration sharing remuneration in the financial
statements of the year
Stock Number of Amount of
Cash amount Total Cash amount Cause Treatment
amount shares discrepancy
Not Not
307,879,824 - - 307,879,824 153,939,912 -
applicable applicable
----- End of picture text -----

  - Note: There is no difference between the aforementioned employee and director remuneration and the employee and director remuneration recognized in the consolidated financial statements for 2022.

(2) The amount of any employee profit-sharing remuneration distributed in stocks, and that amount as a percentage of the sum of the after-tax net income stated in the parent company only financial statement for the current period and total employee profit-sharing compensation: Not applicable
Actual distribution of employee and director remuneration for the previous year:

Year: 2021	Year: 2021	Year: 2021			Unit: shares; NT$	Unit: shares; NT$	Unit: shares; NT$
Employee profit-sharing remuner			ation	Director profit- sharing remuneration	If there is any discrepancy between the actual distributed and the recognized employee or director profit-sharing remuneration in the financial statements of theyear
Cash amount	Stock amount	Number of shares	Total	Cash amount	Amount of discrepancy	Cause	Treatment
330,737,046	-	-	330,737,046	165,368,523	-	Not applicable	Not applicable

Note: There is no difference between the aforementioned employee and director remuneration and the employee and director remuneration recognized in the consolidated financial statements for 2021.

(IX) Stock Buyback: None

50 -

II. Issuance of corporate bonds

March 16, 2023; Unit: NT$

==> picture [427 x 335] intentionally omitted <==

----- Start of picture text -----

Type of corporate bond First Domestic Secured Corporate Bonds Issued in 2018
Date of issuance (processing) July 17, 2018
Denomination 1,000,000
Issue price Issued at par value
Total amount 10,000,000,000
Interest rate Annual interest rate of 1%
Bond period Maturity date: July 17, 2025 (7-year term)
Guarantors Taiwan Cooperative Bank, CTBC Bank, Taishin International Bank, Mega
International Commercial Bank, DBS Bank Limited, Bank of Taiwan, Chang
Hwa Bank, E.SUN Commercial Bank, First Bank, Taiwan Business Bank
Trustee Bank SinoPac
Underwriter Taiwan Cooperative Securities
Certified lawyer Hsin-Lan Hsu, Partner at Lee and Li, Attorneys-at-Law
Certified public accountant Hung-Pin Yu, Deloitte & Touche
Repayment method Bullet
Outstanding principle 10,000,000,000
Redemption or early redemption terms None
Restrictive covenants None
Name of credit rating agency, rating date, and
None
corporate bond rating
Amount converted (exchanged or
subscribed) to common stock, overseas
Other depositary receipts, or other Not applicable
attached marketable securities as of the
rights publication date of the annual report
Method of issuance and conversion
Not applicable
(exchange or subscription)
Issuance; conversion, exchange, or subscription
rules and possibility of dilution of equity under the
None
terms and conditions of issuance and its effect on
existing shareholder equity
Name of the entrusted custodian of the subject of
Not applicable
the exchange
----- End of picture text -----

III. Issuance of Preferred stock: None

IV. Issuance of Depository Receipt: None
V. Status of Employee stock option plan: None
VI. Status of Employee restricted stocks: None
VII. Status of issuance of new shares in connection with Mergers and Acquisitions: None
VIII. Status of implementation of the capital utilization plan: As of the publication date of the annual report, the Company has no incomplete implementation of capital utilization plans, nor has there been any situation where such a plan has been completed within the past three years but the benefits of the plan have not yet been demonstrated.

51 -

Business Overview

I. Description of Business

(1) Scope of Business

1. Main Business and Breakdown of Revenues

Our core products include DRAM and Code Storage Flash Memory. Logic ICs are the main products of Nuvoton Technology Corporation (“Nuvoton”), a major subsidiary of Winbond.

Revenue breakdown of each product as a percentage of consolidated operating revenue for 2022 is as follows:

	Unit: NT$1,000	Unit: NT$1,000
Main Product	Operating Revenue %
DRAM	21,928,754	23
Flash Memory	29,863,054	32
Logic IC	41,640,173	44
Others	1,097,809	1
Operating revenue as reported in consolidated financial statements	94,529,790	100

2. Main Products

2.1. DRAM

Specialty DRAM: Specialty DRAM are mainly applied in computing, communication, and consumer electronics (3C) as well as automotive and industrial electronics. Specifications include 16Mb–4Gb and Known Good Die ( KGD ).
Mobile DRAM: Mobile DRAM are used primarily in mobile phones, tablet devices, low-power mobile devices, wearable devices, automotive and industrial electronics, and IoT applications. Specifications include 64Mb–256Mb Pseudo SRAM, 32Mb–512Mb HyperRAM, 128Mb–4Gb Low Power Mobile DRAM, and Known Good Die (KGD).

2.2. Code Storage Flash Memory

Code Storage Flash Memory are mainly applied in computing and peripheral products, mobile handheld devices and peripheral modules, network communications products, IoT, consumer electronics, automotive and industrial electronics, household appliance modules, etc. Specifications include 512Kb–8Gb.

2.3. Logic IC

Our subsidiary Nuvoton primarily specializes in IC design and sales and IC foundry services with a wide range of applications in microcontrollers (MCU), audio products, and cloud computing products. Since the acquisition of Nuvoton Technology Corporation Japan (NTCJ), our scope of operations has expanded to include image sensing and battery management, thus further broadening the application of MCU products. Nuvoton also owns a 6-inch IC fab with various process technologies for professional IC foundry services.

3. New products and services under development

3.1. DRAM

Specialty DRAM: We are developing medium to low-capacity Specialty DRAM using D25s and 20 nm processes. These products mainly have applications in 3C products as well as automotive and industrial electronics. We are also developing next-generation process technologies.

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Mobile DRAM: We are developing energy-efficient products of varying capacities with high bandwidth and greater data transmission rates for cellphones, tablets, low-power mobile devices, wearable devices, automotive and industrial electronics, and IoT applications.

3.2. Code Storage Flash Memory

We are using 32 nm and 45 nm process technologies to produce safe, high-performance, energy-efficient, and value-added Code Storage Flash Memory for computing and peripheral products, mobile handheld devices and modules, network communications products, IoT, consumer electronics, automotive and industrial electronics, household appliance modules, information security, etc. We are developing more advanced process technologies.

3.3 Logic IC

Our microcontroller product development is focused on high performance, secure encryption, low power consumption, and analog technologies. We are strengthening our product lines to satisfy market demand related to the development of smart IoT and smart homes, and are planning to implement high-end MCUs and MPUs for machine learning inference. These products can be applied in smart IoT devices or systems to identify the shape and color of objects or recognize simple keywords.

(2) Industry Overview

Current Industrial Status and Development

1.1 DRAM

In 2022, global demand for consumer electronic devices weakened considerably in response to inflation-curbing measures such as interest rate hikes. As supply outpaced demand due to accumulated inventory caused by supply chain imbalances and COVID-19, the price of memory products began to drop sharply during the year. With economic recovery remaining unpredictable, memory manufacturers controlled the risk of a slowing economy by reducing production, slowing expansion, engaging in R&D, and flexibly adjusting capacity utilization to meet market conditions. In general, user demand fell in each application category; however, demand in the automotive and industrial sectors was relatively stable. While trends in metaverse, self-driving vehicles, 5G or IoT, and other applications remain unchanged, the growth momentum of server demand is projected to propel the growth of the memory industry.

1.2 Code Storage Flash Memory

Our Code Storage Flash Memory features a serial interface. We are one of the world’s 3 leading suppliers of serial flash memory products and hold over one-third of global market shares. Code Storage Flash Memory is a relatively stable market in terms of size and growth with mature process technology and relatively limited investment. Nevertheless, new supply introduced in recent years did not substantially increase capacity. As a key component in electronic applications; the omnipresent Code Storage Flash Memory applications coupled with the growing number of electronic products and increased content per box has consistently kept the market stable as a whole.

1.3 Logic IC

Demand for MCUs and MPUs is rising. The 32-bit ARM® Cortex®-M MCU and 64-bit ARM® Cortex®-A MPU have become mainstream architectures in the market owing to their advantages including low power consumption, high performance, Trusted Secure Island (TSI)-based security encryption functions, overarching ecosystems, and wide range of users. As for audio products featuring voice interfaces that allow for hands-free interaction with the Internet using natural languages, demand is rising. Concerning cloud computing, post-pandemic demand for computer systems in the end user market will be higher than pre-pandemic levels and then stabilize after adjusting for inventory level. Working and learning patterns have changed significantly, spurring growth in demand for cloud computing and storage, remote collaboration, and open-source technologies. Meanwhile, greater attention is being paid to the security functions of servers and personal computer systems.

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Links between the upstream, midstream, and downstream suppliers

2.1 Memory industry

The industry supply chain consists of upstream equipment suppliers who provide fabrication equipment and raw material suppliers who produce silicon wafers, masks, chemicals, metal targets, gases, and other raw materials.
After purchasing equipment and raw materials, midstream memory suppliers use fabrication equipment to develop a series of complex processes including lithography, rapid high-temperature processing, chemical vapor deposition, ion implantation, etching, chemical machinery polishing and grinding, and process control and monitoring. In addition, midstream memory manufacturers will design and develop relevant memory products based on market demand and future market trends. Process technology is used for finished products on wafers to be delivered to downstream suppliers for backend packaging and testing.
Downstream packaging and testing suppliers are responsible for cutting, grinding, packaging, and completing the final tests of wafers fabricated in the preceding stage before delivering them to memory suppliers. The finished products are distributed to end-product system manufacturers, module manufacturers, or distributors who then apply memory products to end products for end customers.

2.2 Logic IC industry

The supply chain of the Logic IC industry is roughly composed of upstream IC design companies, midstream IC manufacturers, and downstream IC packaging and testing plants. In terms of the supply chain, MCUs are the core of end products, facilitating control and computing processes. In the area of cloud computing IC, downstream customers consist mainly of industries involved in servers, desktop workstations, personal computers, smart handheld devices, network communications, and industrial computers.
Development trends and competition for products

3.1 DRAM

Just as specialty DRAM product technology has advanced from SDR, DDR, DDR2, DDR3, and DDR4 to DDR5, Mobile DRAM has moved from LP DDR, LP DDR2, LP DDR3, and LP DDR4 to LP DDR5. The current global market is still dominated by 3 large international DRAM manufacturers that have initiated mass production of next-generation DDR5 and LP DDR5, increasing the density of mainstream chips to 16Gb. For this reason, the world semiconductor memory industry has entered a new growth cycle.
Concerning process technology, international DRAM manufacturers have increased the proportion of high-end process production, such as DRAM 1xnm, in recent years. Manufacturers in Taiwan have implemented DRAM 2xnm through technology licensing while also developing their own DRAM 1xnm processes. Low-volume production is expected to commence in 2023. We are the only manufacturer in Taiwan that has successfully developed in-house DRAM 25nm process technology. DRAM 25Snm is already in mass production, and development will so be completed on DRAM 20nm. We will invest in the development of next-generation processes.

3.2 Code Storage Flash Memory

Demand for high-density code storage flash memory is increasing. The density of NOR flash memory ranges from 512Kb to 2Gb, and the density of NAND flash memory has been expanded to 8Gb, which is the current market trend. Furthermore, the market is becoming oriented toward developing code storage flash memory for end-user applications that offer added value, security, high speed, and low voltage. Currently, code storage flash memory is largely supplied by international manufacturers and a few Taiwanese and Chinese manufacturers.

3.3 Logic IC

MCU and MPU products must feature low power consumption, high performance, and secure encryption functions. Sd each application has its special peripheral requirements, one single product cannot meet all needs. We therefore developed MCU and MPU platform products that feature highly secure designs and software/hardware reference solutions, introduced machine learning, and launched operating systems, network connection modules, and cloud connection software development platforms suitable for the IoT

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ecosystem to satisfy rapidly evolving demand for diversified applications and IoT equipment. We are also committed to developing products for niche fields to provide customers with the best solutions. Our audio product development is focused on ultra-low power audio microcontrollers (audio MCU/DSP) and audio encoders. Smart class-D audio amplifiers (smart amps), audio amplifiers, audio enhancement, and DSP are the core audio processing algorithms that provide better and more cost-effective solutions for smart homes, mobile phones, consumer electronics, and personal computers. In cloud applications, users upload and analyze massive amounts of data. Innovative applications and services have not only led to the deployment of data computing centers but have spurred increased interest from end users in the security of information-gathering infrastructures. Efforts to improve computing performance, optimize energy consumption, and introduce products with more flexible interface channel design and security features will become mainstream in the future.

(3) Technology and R&D Overview

R&D expenditures of Winbond and its subsidiaries, including Nuvoton, during the previous fiscal year and the current fiscal year up to the date of publication of the annual report are as follows:

		Unit: NT$1,000
Item	2022	2023 upto March 16
R&D expenses	15,818,706	3,259,521

Successfully developed technologies and products

2.1 DRAM

We are the first supplier in Taiwan to successfully develop DRAM process technology. Ever since our self-developed DRAM 25nm and 25Snm entered mass production, production yield and output have been rising steadily. The development of DRAM 20nm is nearing completion, while the development of next-generation processes remains ongoing to meet customers’ quality, reliability, and process specification requirements.

2.2 Code Storage Flash Memory

We used NAND Flash 32nm and NOR Flash 45nm processes to develop code storage flash memory products that offer added value, security, high speed, low power consumption, low voltage, or encryption functions, and we have also developed advanced processes to secure our leading position in serial NOR flash memory. In addition, we promoted serial interfaces and cost-effective 1Gb/2Gb/4Gb/8Gb products to meet the needs of different end-user applications.
2.3 Logic IC
We have introduced the Arm® Cortex®-M0 M029G series MCUs for the 5G data center application market.
Nuvoton introduced the first microprocessor based on dual 64-bit Arm® Cortex®-A35 and Cortex®-M4 cores, which can be applied in the industrial IoT market, which requires high-performance edge computing.
We announced the Hydra solution at the OCP Global Summit. Developed in collaboration with Microsoft, Hydra is a BMC (Arbel used built-in security engine TIP) solution combined with Microsoft’s Cerberus Root of Trust software technology.

(IV) Long- and Short-Term Business Development Plans

Short-Term Business Development Plans

1.1 DRAM

We will increase mass-production yield of DRAM 25S nm process technology to reduce costs and improve quality.
We will develop new products, customers, and applications to improve profitability through increased distribution of chips and revenue.

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We will optimize applications, customers, and product mixes to increase output value and profitability of chips.
1.2 Code Storage Flash Memory
We will mass produce NOR Flash 45nm process technology to expand the scope of application.
We will increase our market share in computing and peripheral products, mobile handheld devices and modules, IoT, automotive and industrial electronics.
We will optimize applications, customers, and product mixes to increase output value and profitability of chips.
We will cultivate world-class brand customers to strive for robust profitability.
1.3 Logic IC
Regarding MCU and MPU, we will enrich our product portfolios and develop platforms and tools to boost our advantages in cost-performance ratio and local services, while actively building an ecosystem of self-designed development platforms and collaborating with third-party vendors to create an optimal development experience for our customers.
Concerning audio products, we will provide comprehensive high-performance audio and voice solutions. For instance, our voice product line includes the industry’s first EMD flash 8-bit uC voice control IC, which effectively shortens the development cycle of voice products and addresses inventory issues.
For our cloud computing products, we will adopt advanced security technologies and integrate local strengths to expand the development of hardware and software solutions suitable for world-leading brands. We will invest resources into product models that are nearing stability, focus on the expansion of consumer products, and also actively participate in international security standardization organizations and open-source initiatives to maintain our leading edge in technology.

2. Long-Term Business Development Plans

2.1 DRAM

We will develop advanced processes to increase our core competitiveness.
We will develop mobile DRAM with new specifications and explore different areas of application.
We will increase shares in niche markets including KGD, automotive and industrial electronics, MCP, and SiP.

2.2 Code Storage Flash Memory

We will expand our presence in the high-margin end-product application market including automotive and industrial electronics, IoT, and wearable devices, all certified by leading international manufacturers.
We will aim for high speed, low voltage, low power, and heightened security to increase product value.

2.3 Logic IC

We will develop MCU and MPU products and platforms, low-power consumption, analog, and security technologies, thereby enriching our 64-bit microprocessor and 32-bit and 8-bit MCU platform through innovation and process advancement.
As for audio products, we will develop high-performance, low-power audio processing controllers and expand the deployment of amplifiers and ULP audio CODEC products in hopes of moving away from the low-end, low-price market to cultivate the smart toy market with a higher profit margin.
Concerning cloud computing products, the growing popularity of web applications has made cyber security and the security of high-end equipment a critical issue that must be addressed in the future. Through extensive collaboration with customers for a prolonged period, we will actively conduct research on the integration of peripheral components and seek opportunities to launch new products.

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II. Market, Production, and Sales

(1) Market Analysis

1. Our consolidated operating revenue, including Nuvoton and other subsidiaries, by sales region for 2022 is as follows:

Unit: NT$1,000

==> picture [414 x 102] intentionally omitted <==

----- Start of picture text -----

Region Sales %
Asia 85,135,882 90%
North and South America 5,412,842 6%
Europe 3,584,558 4%
Others 396,508 -
Total 94,529,790 100%
----- End of picture text -----

Market share, future supply and demand situation, and market growth potential

2.1 DRAM

In 2022, our share of the overall DRAM market was slightly over 1%. As we entered 2023, we saw a gradual decline in the explosive demand for TVs, personal and business computers, notebooks, and other consumer products that emerged at the end of the COVID-19 pandemic, while digital transformation in the business sector accelerated server development and led to a significant increase in cloud-related investment, which has been the main cause of the recent increase in demand for DRAM. In the long run, the development of AI and 5G technologies will take IoT applications to the next level, and the extensive use of AI in consumer electronics, IoV (Internet of Vehicles), and Industry 4.0 will drive demand for embedded memory chips and content per box. All of these developments will contribute to steady growth in the DRAM sector.

2.2 Code Storage Flash Memory

We are the global leader in code storage flash memory. In 2022, we held over one-third of the global market share of serial flash. Demand for code storage flash memory is moving toward high-density products. The increase in device density coupled with the advantages of fewer pins and lower overall costs afforded by serial-interface code storage flash memory will enable growth in the serial-interface code storage flash memory market.

2.3 Logic IC

Our 32-bit Cortex®-M0/M4 MCUs, ARM® 7/9, and 8-bit MCUs are cost-effective and well-received by the market, leading to annual increases in our market share. Our major clients include well-known domestic and foreign manufacturers of consumer, industrial control, power, and communications products. We have also acquired a significant market share of audio product applications in toys, IoV, IoT, and consumer home appliances. In terms of products with computer and cloud applications, the market share of our motherboard Security Controller I/O, notebook EC, and TPM still ranked in the top 3 worldwide in 2022. Our major clients include well-known computer brands and OEM service providers.
Competitive niche, favorable and unfavorable factors for future development, and countermeasures

3.1 DRAM

Competitive niche: Process development, new product development, testing technology, FAE capabilities, and marketing and distribution strengths are our core competencies. Currently, other DRAM suppliers in Taiwan acquire their process technology from large foreign DRAM manufacturers through technology licensing. We are one of the few DRAM suppliers in Taiwan with advanced process development capabilities. We have improved R&D efficiency in recent years to shorten process development schedules.
Favorable factors for future development: An increase in the system space of smartphones, tablets, TVs, set-top boxes, networking, and storage devices will increase DRAM demand. In terms of supply, Moore’s law

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in advanced process technology is entering a bottleneck, slowing down supply growth, which is conducive to industry development.

Unfavorable factors and countermeasures: Slowing demand for smartphones may prompt other suppliers to reallocate capacity to DRAM, leading to an increased supply and disrupting the market equilibrium. We will optimize application portfolios, thus expanding our presence in automotive and industrial electronics as well as IoT applications. We will also invest in the development and adoption of advanced processes to improve profitability. We are constantly exploring new applications and building strong customer relationships to mitigate risks arising from market uncertainties.

3.2 Code Storage Flash Memory

Competitive niche: We have been cultivating the flash memory market for many years with a complete series of Code Storage Flash products, ranging from 512Kb to 8Gb.
Favorable factors for future development: We have steadily held over one-third of the global market share in recent years, gaining recognition from clients for quality and affordability. We currently hold over 40% of market shares in computing and peripheral products and continue to develop high-density products and applications including automotive and industrial electronics, 5G networks, and servers.
Unfavorable factors and countermeasures: New manufacturers in China will start supplying new capacities, which will affect supply and demand in the low to medium-density product market and in turn impact end-product demand. We will optimize application portfolios, thus further expanding our presence in markets including mobile handheld devices, automotive and industrial electronics, and IoT applications. We will also invest in the development and adoption of advanced processes to improve profitability and develop new applications and customer bases to reduce risks arising from market uncertainties.

3.3 Logic IC

Competitive niche: Our MCU products, developed by a team of R&D and IT professionals in collaboration with strategic partners, offer a total system solution that lowers costs for customers and enhances their competitive edge. We gained experience in voice and audio processing by integrating audio CODEC and third-party voice recognition with MCU to achieve IoT market application for a diverse range of product options and ideal economic solutions. In terms of cloud computing products, Winbond and customers jointly developed customized chips for non-computer product lines to lower costs and enhance competitive edge.
Favorable factors for future development: Our new-generation MCUs offer high compatibility, a uniform development platform, and advantages in ease of development and eco-protection certifications. This core competency raises the barrier of competition for rivals. We have also launched high-performance voice/audio MCUs and the world’s first smart amplifier based on non-linear speaker protection for unparalleled sound quality and compatibility with thin speakers. These features enable a simpler and trendier exterior and industrial design in end-customer applications. Our cloud computing products retain a leading position in the market. We are also the only TPM IC supplier in the world that is FIPS (Federal Information Processing Standards), Common Criteria EAL4+, and TCG (Trust Computing Group) certified.
Unfavorable factors and countermeasures: Fierce competition in the consumer electronics market in recent years, short product life cycles, and rapid replacement of traditional products have all contributed to increased costs. The only way to maintain a leading position in the market is to develop highly integrated products with lower costs while enhancing R&D capabilities. Thus, we will strengthen product optimization and invest in global technical support teams to provide localized customer services and seize opportunities that will put us ahead of others. We will also build a sales team focused on customer applications and vertical integration solutions to replicate our success in other cities and emerging markets.

(II) Usage and Manufacturing Processes for Main Products

Usage of Main Products
1.1 DRAM
- SDR/DDR/DDR2/DDR3/DDR4/DDR4X Specialty DRAM in computing and peripheral products, automobile electronics, and consumer electronics.

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- Pseudo SRAM, HyperRAM, Mobile DRAM (Low Power DRAM) in mobile devices, computers, and consumer electronics.
1.2 Code Storage Flash Memory
- Used in computing and peripheral products, mobile handheld devices and modules, network communications, IoT, consumer electronics, automotive and industrial electronics, household appliance modules, etc.
1.3 Logic IC
- Provide customers with industrial controls, consumer electronics, smart home appliances, computer equipment, vehicle-mounted equipment, and communication products.
Manufacturing processes for main products

The integrated circuit manufacturing process consists of five processes: IC design, mask making, wafer fabrication, packaging, and testing. Flowchart is presented below:

==> picture [420 x 237] intentionally omitted <==

----- Start of picture text -----

Set
Specifications
IC Packaging
Wafer Fabrication
IC design System design
Layout design and software
design
Final Testing
Wafer C.P.
Test
Mask Making
----- End of picture text -----

(3) Supply of Main Raw Materials

Our main raw materials include silicon chips, process chemicals, special gases, and targets, all of which are supplied by semiconductor manufacturers based in the USA, Japan, South Korea, and Taiwan. Our suppliers provide materials of considerable quality, which ensures supply stability. Outsourced items include testing and packaging, with at least two different qualified suppliers for each item, so as to ensure source and stability of supply.

(4) List of suppliers accounting for 10% or more of the company’s total purchases amount in either of the 2 most recent fiscal years, the amounts bought from each, and the percentage of total purchases accounted for by each

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Unit: NT$1,000

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----- Start of picture text -----

2022 2021
Item Name Amount As a percentage Relationship Name Amount As a percentage Relationship
of the year’s net with Issuer of the year’s net with Issuer
purchases (%) purchases (%)
1 Supplier K 4,583,838 20.2% None Supplier K 6,264,279 29.0% None
Other 18,158,196 79.8% Other 15,323,746 71.0%
Net purchase 22,742,034 100.0% Net purchase 21,588,025 100.0%
----- End of picture text -----

(5) List of clients accounting for 10% or more of the company’s total sales amount in either of the 2 most recent fiscal years, the amounts sold to each, and the percentage of total sales accounted for by each

Unit: NT$1,000

==> picture [426 x 82] intentionally omitted <==

----- Start of picture text -----

2022 2021
Item Name Amount As a percentage Relationship Name Amount As a percentage Relationship
of the year’s net with Issuer of the year’s net with Issuer
sales (%) sales (%)
1 Client Y 14,393,996 15.2% None Client Y 13,524,520 13.6% None
Other 80,135,794 84.8% Other 86,045,404 86.4%
Net sales 94,529,790 100.0% Net sales 99,569,924 100.0%
----- End of picture text -----

(6) Output volume and value in the most recent two years

Total combined output of the Company and its subsidiaries, including Nuvoton Technology:

Unit: NT$1,000

==> picture [426 x 128] intentionally omitted <==

----- Start of picture text -----

Year 2022 2021
Main Production Output Volume (Note 2) Production Output Volume (Note 2)
Products/Capacity Capacity (Note Output Value Capacity (Note Output Value
Wafer Die Wafer Die
/Output 1) 1)
DRAM products 12-inch 1.9 795,523 10,471,179 12-inch wafers: 1.0 1,629,598 15,656,297
Flash products wafers: 708 0.2 2,601,822 13,059,924 678 0.1 3,972,766 17,024,491
6-inch wafers:
Logic IC products 471 6,337,138 28,142,912 [6-inch wafers: ] 493 6,852,788 29,272,811
752 692
Total 473.1 9,734,483 51,674,015 494.1 12,455,152 61,953,599
----- End of picture text -----

Note 1: Wafer production capacity is measured in units of 1,000 pieces. Note 2: Wafer production is measured in units of 1,000 pieces; die production is measured in units of 1,000 pieces.

(7) Sales volume and value in the most recent two years

Total combined sales of the Company and its subsidiaries, including Nuvoton Technology:

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----- Start of picture text -----

Unit: NT$1,000
Year 2022 2021
Domestic Sales Exports Domestic Sales Exports
Main Product/
Sales Volume (Note) Value Sales Volume (Note) Value Sales Volume Value Sales Volume (Note) Value
Sales volume
(Note)
and value
Wafer Die Wafer Die Wafer Die Wafer Die
DRAM products - 123,490 3,423,900 2 728,556 18,504,854 - 400,588 7,430,258 1 1,211,571 18,956,320
Flash products - 583,430 5,359,787 - 2,129,867 24,503,267 - 1,056,615 6,806,733 - 2,736,546 25,088,306
Logic IC
154 319,394 6,080,267 312 6,216,262 35,559,906 199 396,482 5,658,721 287 7,054,971 35,428,189
products
Others - - 465 - - 1,097,344 - - 930 - - 200,467
Total 154 1,026,314 14,864,419 314 9,074,685 79,665,371 199 1,853,685 19,896,642 288 11,003,088 79,673,282
----- End of picture text -----

Note: Wafer sales are measured in units of 1,000 pieces; die sales are measured in units of 1,000 pieces.

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III. Employees

Information about the employees of the Company and its subsidiaries, including Nuvoton Technology:

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----- Start of picture text -----

Year 2021 2022 As of March 16, 2023
Technicians (Engineers) 4,814 5,208 5,161
Administration and sales
Number of 1,788 1,832 1,869
staff
Employees
Assistant technicians 826 902 888
Total 7,428 7,942 7,918
Average Age 42.34 42.03 40.68
Average Years of Service 12.82 10.09 9.79
PhD 1.37 1.33 1.39
Master’s 41.37 42.42 42.55
Education Level University/College 46.40 46.30 46.10
(%)
Senior High School 10.16 9.38 9.27
Junior High School and
0.44 0.48
below 0.70
----- End of picture text -----

IV. Information on Environmental Protection Expenditure

(1) Any losses suffered by Winbond in the most recent fiscal year and up to the annual report publication date due to environmental pollution incidents (including any compensation and violations of environmental protection laws or regulations found in inspection with disposition dates, reference numbers, articles and substances violated, and contents), disclosing an estimate of possible current and future expenses incurred with measures: None

(2) Preventive measures taken to ensure a safe working environment and protect employee safety

We uphold the spirit of the ISO 14001 environmental management system and pledges to maintain a working environment superior to statutory requirements and general industry practice. We also strive to comply with international environmental protection standards and seek to eliminate possible environmental risks through iterative improvement.

As a member of the global village in line with the principle of eco-friendly design, we are committed to developing green products and energy-efficient, low-pollution electronic applications to fulfill our vision of corporate sustainability.

Throughout operations, we rely on process optimization to reduce water/power consumption, use of raw materials, and carbon footprint per output unit. Concerning organizational management, we have established a Quality & ESH Center to oversee environmental, health, and safety management. We have also appointed suitable environmental management specialists to oversee air/water pollution control, waste disposal, and toxic chemicals management. We have obtained all environmental protection permits and licenses required by law. Proper recycling systems for wastewater, exhaust gases, and solid wastes were incorporated during the initial stage of plant design to reduce resource losses and emissions.

Furthermore, we have integrated ISO45001 and CNS45001 into safety, health, and loss control management tasks to form an environmental safety and health management system in hopes of improving our overall performance. We conduct biannual internal and annual external audits of environmental, health, and safety management to ensure proper implementation.

Thanks to our commitment to environmental protection, we have won various awards from EPA and MOEA including the Annual Enterprises Protection Award (AEEPA), National Industrial Waste Minimization Excellent

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Performance and Group Performance Award, and Industry Outstanding Voluntary Greenhouse Gas Emission Reduction Factory Award. Over the years, we have been rated as a Friendly Workplace by the Ministry of Labor; an Excellent Rating for Labor Health and Safety by the Central Taiwan Science Park Administration; and an Outstanding Healthy Workplace by the Health Promotion Administration.

Going forward, we will continue to strengthen our spirit of corporate sustainability, respond to growing environmental awareness by investing in appropriate environmental protection expenditure when needed, adopt innovative technologies to improve the efficiency of pollution control, and strive to minimize the environmental impact of our activities.

V. Labor relations

(1) Employee benefit plans, continuing education, training, retirement systems, and implementation status

Employee benefit plans
(1) We have established an Employee Welfare Committee, Retirement Reserve Fund Supervisory Committee, and Environmental, Health, Safety, and Risk Management Committee. Labor management meetings, feedback boxes, complaint hotlines, and Sexual Harassment Complaints Committee are channels for maintaining effective communication with employees.
(2) We provide a comprehensive and high-quality benefit package for our employees and their families. In addition to statutory benefits including labor insurance, national health insurance, and pension reserve, we also have an above-average child care subsidy system.
A. Child care subsidy: In support of the government’s efforts to increase birth rates, we have set up child care subsidies for employees to support their family. Employees who have been with Winbond for over one year are entitled to a subsidy of NT$6,000 per month for each newborn until the child reaches the age of four. Such measure makes us one of the best companies to work for.
B. Marriage and childbirth subsidies: In addition to child care subsidies, marriage and childbirth allowances are also provided when employees get married or have children.
Employee training and continuing education

In accordance with the Company’s Education and Training Management Procedures , we have established a well-equipped learning environment with an expansive range of learning modes that include in-person training, live streaming, and digital courses. In addition, external resources are utilized to train employees, cultivate in-house lecturers and employee competencies, thereby promoting a learning-oriented corporate culture. The Company has adopted the following learning channels:

(1) In-person courses: Each year, the Company plans and implements professional, QC, workplace safety, management, and general education training programs as needed. Employees may sign up for these courses according to their needs. The types of courses offered are summarized as follows:
A. Management training involves a range of training exercises related to management skills development that are based on the company’s management competency blueprint. These exercises include courses that help junior managers establish correct management concepts and hone their management skills, seminars in which in-house managers share their work experiences, and lectures on a variety of topics given by experts from industry, government, and academia. The wide range of training activities are aimed at enhancing the managerial capabilities of all management levels.
B. General education, QC, and workplace safety training programs are designed and established as needed by the company in accordance with the company’s quality policy and government laws and regulations. These programs include work skills training, awareness-raising courses on the Act of Gender Equality in Employment and sexual harassment prevention, statistical analysis methods, and emergency response safety training classes.
C. Professional training is planned as per each unit’s specific needs. Examples of professional training courses include R&D design, process testing, international seminars, and experience-sharing sessions. In-house employees and external experts are invited to share their knowledge and experience.
D. Orientation training covering job systems and rules, corporate culture, and work adaptation to help new employees assimilate into their new work environment. Courses related to ESG, workplace safety, and unlawful infringement in the workplace are also provided to create a positive work environment that ensures the health and safety of employees.

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E. Basic training assessments and continuing advanced skills assessments are conducted on direct employees, including new employees.
(2) Learning platform: Information on online courses is provided on the Company’s training platform to encourage learning. Employees can learn anywhere at any time and choose courses according to their needs. A diverse range of courses are offered, including general education courses on the corporate environment and management system, laws and regulations and code of conduct, process R&D development and quality training, data science, languages, and other elective courses.
(3) Lifelong learning: To encourage continuous development and personal growth, we provide reference to employees studying for a domestic or international Master’s or PhD degree accredited or approved by the Ministry of Education as per our In-service Continuing Education Regulations. Tuition fees are covered by Winbond. We also provide subsidies for employees to hone their work skills at external or foreign organizations.
Retirement system

We have established retirement regulations as per Labor Standards Law and Labor Pension Act with pension fund for employees under the old or new system:

(1) Employees applicable to the old pension system under the Labor Standards Act: The contribution rate, in addition to 2% of monthly salary, is regularly audited every year along with application reviews by the Retirement Reserve Fund Supervisory Committee.
(2) Employees applicable to the new pension system under the Labor Pension Act: Monthly contributions are 6% of the pay grade into personal pension accounts with an another optional 6% from the employees themselves.

(2) Certifications obtained by personnel responsible for financial transparency

Certification obtained by the employees of the Company and its subsidiaries, including Nuvoton Technology, is as follows:

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Certification Number of People
Certified Internal Auditor (CIA) 5
Certification in Control Self-Assessment (CCSA) 1
Certification in Risk Management Assurance (CRMA) 1
Certified Information Systems Auditor (CISA) 2
CPA of the Republic of China 8
CPA of the United States of America 2
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(3) The status of labor-management agreements and measures for preserving employees' rights and interests
We have established Rules for Labor-Management Meetings and regularly convenes meetings to discuss and mediate related issues. Items resolved must be addressed by relevant units within a limited time.
We have established Internal Grievance Rules to safeguard employees’ legal rights and interests, eliminate illegal and unreasonable treatment, and provide a compliant, reasonable, and fair working environment.
(4) List any losses suffered by Winbond in the most recent fiscal year and up to the annual report publication date due to labor disputes (including any violations of the Labor Standards Act found in inspection with disposition dates, reference numbers, articles and substances violated, and contents): None
(5) An estimate of possible current and future expenses incurred with measures

We hold regular labor meetings to promote opinions exchange between employers and employees. Both parties have consistently maintained consensus since the founding of Winbond without disputes occurring. We also continue to reiterate the importance of regulatory compliance and strengthened overtime management.

(6) Employee Code of Conduct

We have established the Employee Code of Conduct to regulate work ethics, protection of intellectual property rights/business secrets, and workplace order, etc. This is accessible for review via our documentation system, Intranet announcements or bulletin boards as detailed below:

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1. Work ethics

(1) Work Rules: service rules and general principles for prevention of sexual harassment.
(2) Workplace Sexual Harassment Prevention Regulations: established as per relevant government laws with a dedicated awareness website, and appropriate prevention, correction, and punishment for events.
(3) Employment contracts: specifies agreements with respect to faithful duty performances.
(4) Code of Conduct for Human Resource Management: a series of courses set up as per relevant government laws and regulations with topics on eliminating discrimination, fair treatment, and prohibition of involuntary work. All employees are made aware to ensure that everyone can work in a fair and lawful environment.
Rules for protection of intellectual property rights and business secret confidentiality
(1) Work Rules: general principles for confidentiality.

(2) Employment contracts: specify agreements concerning duties, document ownership, confidential information, ownership of intellectual or industrial property, and non-compete terms.

Order of work

(1) Allocation of responsibilities: Guidelines for Stratification of Responsibilities specify the division of labor, providing a basis for performance of duties.

(2) Duties of individual units: clearly allocate mission and tasks
(3) Restrictions on employment of relatives: Rules on Avoiding Employment of Relatives state that relatives shall not be hired to fill certain positions to ensure effectiveness and efficiency of internal management is not unnecessarily compromised by nepotism.
(4) Attendance management
A. Leave Rules: specify principles and regulations regarding leave of absence.
B. Rules on Business Travel in Taiwan and Rules on Foreign Business Travel: To facilitate personnel management and substitute mechanism, we have established operating procedures for business travel applications to grant appropriate subsidies and facilitate task completion.
C. Overtime Rules: specify principles and regulations regarding overtime.
D. Rules for Cancellation of Work in the Event of Natural Disasters and Emergency Incidents: criteria for cancelling work in the event of (or after) a natural disaster and emergency incident.
(5) Performance management

Performance Management and Evaluation Regulations: aim to determine employees’ strengths and weaknesses based on the degree of target achievement, in turn help develop capabilities. Employees’ contributions to the organization are determined based on peer comparison, while improvement guidance and measures will be provided for underperformance.

(6) Reward and disciplinary actions

Reward and Punishment Rules: prescribe appropriate rewards for excellent performance or disciplinary actions against violators of regulations to encourage and maintain morale and workplace order.

(7) Workforce development
A. In-service Continuing Education Regulations: channels are established to build a pool of high-caliber talents needed for our long-term development.
B. Rules on Application for Participation in Academic Organizations: promotes diffusion of knowledge and experience with access to latest information on various areas of expertise.
C. Rules for Attending and Managing Conferences and Seminars: Participation in international conferences or seminars enables employees to acquire the latest information on their area of expertise.
(8) Communication channels
A. Rules for Labor-Management Meetings: to establish consensus on moral conducts, promote teamwork for business development and employee well-being, maintain effective two-way communication, eliminate

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disputes, ensure harmonious relations, and encourage maximal productivity.

B. Internal Grievance Rules: provide channels for employees to express opinions, file complaints directly to protect their rights and interests, and promote feedback.
C. Employee Suggestion Rules: Employees’ ideas and creative thinking can help us improve continuously. Employees are rewarded for making suggestions that benefit our overall operations to encourage them to contribute their wisdom and experience.

VI. Cybersecurity Management

(1) Information security policy

Winbond has an Information Security Policy and Management Rules for Technical and Confidential Information in place to keep our IT environment secure, protect the Company’s information and computer systems, and ensure that customer privacy is properly protected. We sign, confidentiality agreements with our suppliers and customers to collectively protect confidential information and prevent the disclosure of sensitive information. In addition, the Company conducts annual internal audits of information security operations in accordance with the internal control system. In 2022, we established a unit to take charge of and oversee information security operations, and appointed a Chief Information Security Officer (CISO) to oversee the effectiveness of the company’s cybersecurity operations and cybersecurity risk management mechanisms.

(2) Information security management

Winbond obtained ISO 27001 Information Security Management System certification in 2021 and adopted this system in our Kaohsiung Fab plant in November 2022, thus expanding the scope of application to include not only our Zhubei Building and CTSP Fab but also the Kaohsiung Fab. We set up an information security organization in compliance with standard norms to regularly convene cybersecurity management meetings during which cybersecurity issues and events are discussed and improvement actions are taken. Because the Company manages cybersecurity risks associated with the electrical and electronic systems of road vehicles, we obtained the ISO 21434 Road vehicles—Cybersecurity engineering certification in August 2022, becoming the first memory manufacturer in the world to obtain this certification.

For the purpose of safeguarding crucial company product information, we work continuously to strengthen access control and surveillance systems, IT access authorization management, and record keeping and review, and strictly control both access by personnel and access to data to avoid unauthorized access to and tampering with company information. In 2022, Winbond launched a business secret management system to prevent theft or leaks of trade secrets and intellectual property.

In addition, the design and development, production, delivery, and operating environments of our secure memory products are Common Criteria EAL 5+ certified, which means that Winbond’s control over product information security meets the Common Criteria, and that Winbond is able to manufacture internationally trusted products that ensure the security of customer information and assets.

(3) Risk management framework and management solutions

In response to remote work models, the Company reduced the cybersecurity risks of remote Internet connections by adopting such mechanisms as device management, identity verification, multi-factor authentication, and source IP addresses. We also strengthen the monitoring and reporting of cloud services to minimize the probability of cyberattacks.

To strengthen the cybersecurity awareness of employees, the Company organizes monthly awareness campaigns on cybersecurity topics and conducts social engineering training exercises every three months. Those who fail to complete training are prohibited from using the Internet. Each year, employees must be trained and educated on cybersecurity and pass the relevant tests. Systems that provide external services are scanned in real time using cloud monitoring tools. When major risks are identified, updates are scheduled immediately and implemented as soon as possible. Internal systems are subject to vulnerability scanning in conjunction with Microsoft’s major risk alerts; monthly updates are scheduled to repair any vulnerabilities.

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(4) Resources invested in information security management

The Company has established a Cybersecurity Department to reinforce its defense architecture against cyberattacks and data leaks. By using a cloud-based service security mechanism, we have enhanced identity verification and detection of irregular login activities to reduce the risk of cyberattacks. Our self-designed SIEM system, external SOC services, and cloud monitoring services have bolstered the monitoring and reporting of suspicious behavior. Cybersecurity is managed by regularly conducting annual system audits, backup recovery, remote backup, cybersecurity drills, and business continuity exercises. In 2021, Winbond adopted a cloud-based cybersecurity risk monitoring system to instantly scan external services for any vulnerabilities and improve any major risks so as to keep the services we provide to external parties protected and guarded against cybersecurity risks.

IT technologies are constantly evolving. Despite efforts to reinforce our cybersecurity, the Company remains at risk of being subject to the impact of new technologies and of data breaches, as we cannot guarantee complete prevention of unlawful attacks and stealing of company secrets, intellectual property, and confidential information. In the event of a cyberattacks, the Company would need to compensate customers for their losses and implement costly remedies and improvement actions. The Company could also be exposed to significant legal liability arising from or related to legal proceedings or regulatory investigations associated with leaks of customer or third party data.

In addition, the Company needs to share business information with certain third-party service providers to enable them to provide the relevant services. While we require all third-party service providers to sign confidentiality agreements, there is no assurance that every service provider will fulfill or observe such obligations. Should such systems, equipment, or services become subject to cyberattack and the Company or service providers be unable to resolve the arising problems in a timely manner, our commitments to customers and other stakeholders could be materially impaired, subsequently exerting a materially adverse effect on the Company’s operations, finance, and reputation.

(5) Impacts of major cybersecurity incidents and response measures

In 2022 and up to the printing date of the annual report, the Company has not experienced any cybersecurity incidents that have caused or are likely to produce materially adverse impacts on company business and operations.

VII. Important Contracts

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Contract
Nature of
Parties Commencement and Content Restrictive Covenants
Contract
Expiration Dates
Procurement of construction materials for
2016.05–2024.12 basement, above-ground structure, and
exterior glass curtain walls of Zhubei Building
Construction of Zhubei Building basement,
2016.05–2024.12 above-ground structure, and exterior glass
curtain walls
Contract services for Kaohsiung FAB_A and
Engineering/ 2018.11–2024.06
TASA Construction CUB substructure None
Construction
Corporation Material procurement for Kaohsiung FAB_A
Contract 2018.11–2024.06
and CUB substructure
Contract services for building the main
2018.12–2025.09
structure of Kaohsiung Fab
Procurement of materials for building the
2018.12–2025.09
main structure of Kaohsiung Fab
Contract services for steel structure of
2019.03–2024.12
Kaohsiung Fab A
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Contract
Nature of
Parties Commencement and Content Restrictive Covenants
Contract
Expiration Dates
Procurement of materials for steel structure
2019.03–2024.12
of Kaohsiung Fab A
Contract services for building renovation at
2019.05–2024.05
Kaohsiung Fab A
Material procurement for building
2019.05–2024.05
renovation at Kaohsiung Fab A
Contract services for exterior wall work at
2019.07–2025.11
Kaohsiung Fab
Material procurement for exterior wall work
2019.07–2025.11
at Kaohsiung Fab
Contract services for pure water system
2019.03–2022.09
Nomura Micro Science Co., work at Kaohsiung Fab
Ltd. Material procurement for pure water
2019.03–2022.09
system work at Kaohsiung Fab
Contract services for wastewater collection
2019.09–2023.06 and treatment system work at Winbond
Electronics Kaohsiung Fab-A
Mega Union Technology Inc.
Material procurement for wastewater
2019.09–2023.06 collection and treatment system work at
Winbond Electronics Kaohsiung Fab-A
Contract services for Phase 1 of mechanical,
2019.11–2024.04 electrical, and plumbing (MEP) system work
at Kaohsiung Fab
L&K Engineering Co., Ltd.
Material procurement for Phase 1 of
2019.11–2024.04 mechanical, electrical, and plumbing (MEP)
system work at Kaohsiung Fab
Contract services for clean room work at
2019.12–2024.04
Winbond Electronics Kaohsiung Fab
Exyte Taiwan Co., Ltd.
Material procurement for clean room work
2019.12–2024.04
at Winbond Electronics Kaohsiung Fab
Material procurement for 10.5K Exhaust
2021.10–2023.12
Uangyih-Tech Industrial Co., Hookup work at Kaohsiung Fab
Ltd. 2021.10–2023.12 Service procurement for 10.5K Exhaust
Hookup work at Kaohsiung Fab
Service procurement for 10.5K Hookup—gas
2021.10–2023.09
piping system work at Kaohsiung Fab
Laien Parts Technology 2021.10–2023.09 Material procurement for 10.5K
Hookup—gas piping system work at
Kaohsiung Fab
Contract services for 10.5K
2021.10–2023.09 Hookup—electrical system work at
Kaohsiung Fab
Material procurement for 10.5K
J-YIH Electrical & Plumbing
2021.10–2023.09 Hookup—electrical system work at
Co., Pte. Ltd.
Kaohsiung Fab
Material procurement for 10.5K
2021.10–2023.12 Hookup—gas piping system work at
Winbond Electronics Kaohsiung Fab
Material procurement for 10.5K
2021.10–2023.09 Hookup—high vacuum piping system work
at Kaohsiung Fab
Tun Yi Industrial Co., Ltd.
Contract services for 10.5K Hookup—high
2021.10–2023.09 vacuum piping system work at Kaohsiung
Fab
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Contract
Nature of
Parties Commencement and Content Restrictive Covenants
Contract
Expiration Dates
Contract services for 10.5K Hookup—gas
Rayzher Industrial Co., Ltd. 2021.10–2023.12 piping system work at Winbond Electronics
Kaohsiung Fab
Material procurement for 10.5K
Hookup—UPW, chemical, and solvent
2021.10–2023.12
drainage system work at Winbond
Swift Engineering Co., Ltd. Electronics Kaohsiung Fab
Contract services for 10.5K Hookup—UPW,
2021.10–2023.12 chemical, and solvent drainage system work
at Winbond Electronics Kaohsiung Fab
Material procurement for 10.5K Hookup
work at Winbond Electronics Kaohsiung Fab:
2021.10–2023.09
Piping facility hookup –drainage, PCW, PV,
Wholetech System Hitech HV, and onsite management
Limited Contract services for 10.5K Hookup work at
Winbond Electronics Kaohsiung Fab: Piping
2021.10–2023.09
facility hookup –drainage, PCW, PV, HV, and
onsite management
Acquisition of Floors 13 and 14 of Building H
Sale/Purchas Nanzong Construction
2019.09–2024.06 and 13 parking spaces in the Taipei Nankang
e Contract Developments, Co., Ltd.
World Pearl construction project
Investment of US$15 million in venture
Investment JVP Growth Opportunity X.
2020.10–2028.12 capital fund to be made in installments over
Contract L.P.
the next five years after fund establishment
Linde Lienhwa Industrial
2021.04–2036.03 Bulk gas supply at CTSP Fab None
Gases Co., Ltd.
The Company shall
Supply not sublicense rights
Contract to any third party.
Air Liquide Far Eastern Ltd. 2022.04–2025.03 Gas supply contract
The Company is
bound by a duty of
confidentiality.
The Company is
Company T 2022.07–2026.12 Purchase of materials bound by a duty of
confidentiality.
Joint 10 banks including Taiwan
2018.06–2025.07 Joint guarantee of NT$10.15 billion
Guarantee Cooperative Bank
Financial ratios, etc.
Syndicated 19 banks including Bank of
2019.01–2026.09 NT$42 billion syndicated loan
Loan Taiwan
Company A 2008.07–indefinite Technology licensing The Company shall
Company B 2009.06–indefinite Technology licensing not sublicense rights
Licensing to any third party.
Company C 2009.11–indefinite Technology licensing
Agreement The Company is
Company B 2012.06–indefinite Technology licensing
bound by a duty of
Company B 2016.03–indefinite Technology licensing confidentiality.
The Company is
bound by a duty of
Sales
Company D 2017.08–2022.07 Product sales confidentiality when
Contract
providing product
warranties.
Share Payment of share
Autotalks Ltd. and other
Sale/Purchas 2019.07–indefinite Equity investment capital according to
investors
e Agreement agreement.
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Contract
Nature of
Parties Commencement and Content Restrictive Covenants
Contract
Expiration Dates
Hsinchu Science Park
Administration, Ministry of
Lease Payment of rent
Science and Technology (now 2019.08–2027.12 Lease
Agreement according to contract.
National Science and
Technology Council)
Merger &
Payment of M&A cost
Acquisition Panasonic Corporation 2019.11–indefinite Merger & acquisition
according to contract.
Contract
Procurement 2020.04–PO is no
Company E Software licensing
Contract longer issued
Sales Service The Company is
Company F 2020.09–2023.08 Product sales
Contract bound by a duty of
Procurement confidentiality.
/Sales Company F 2020.09–2023.08 Product purchases and sales
Contract
Purchases of
Panasonic Asia Pacific Pte.
2020.09–indefinite Sales and purchases of assets machinery, products
Asset Ltd.
and other assets.
Sale/Purchas
Payment of asset
e Agreement Panasonic Semiconductor
2020.09–indefinite Sales and purchases of assets price in accordance
(Suzhou) Co., Ltd.
with contract
The Company shall
Microchip Technology 2020.03–Expiration
Patent license not sublicense rights
Incorporated of patent
Licensing to any third party.
Contract The Company is
Use of all IPs in the subscribed software is
Company B 2021.08–2024.07 bound by a duty of
allowed
confidentiality.
2020.05–2027.08 Loan Payment of interest
Loan Export–Import Bank of the
and repayment
Contract Republic of China 2019.09–2026.09 Loan
according to contract.
Service Payment for services
Provision Panasonic Corporation 2020.09–indefinite Provision of services in accordance with
Agreement contract
Asset Sale and transfer of
Transfer HSMC (Suzhou) Co., Ltd. 2021.04–indefinite Sale and purchase of assets assets in accordance
Contract with contract
M&A Price Payment of adjusted
Panasonic Corporation
Adjustment Description of M&A price adjustments M&A prices as per
Industrial Solutions Company [2021.04–indefinite ]
Contract contract
Development and
Contractor
2021.12–2025.12 Contracted to develop and design ICs design of ICs as per
Agreement [Company G ]
contract
Sales
Company H 2022.02–indefinite Sale of equipment
Contract
Joint Loan
7 banks 2021.05–2026.05 Loan
Contract
Wafer
The Company is
Production
Company I 2022.1–2025.12 Wafer procurement bound by a duty of
Procurement
confidentiality.
Contract
Wafer
Production
Company J 2022.2–2026.1 Wafer procurement
Procurement
Contract
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Nature of Contract	Parties	Contract Commencement and Expiration Dates	Content	Restrictive Covenants
Price Adjustment Contract	Company K	2022.6–indefinite	Price adjustment

VIII. Material impact on the company’s financial situation of financial difficulties experienced by the company and its affiliates in the most recent fiscal year or during the current fiscal year up to the date of publication of the annual report: None.

70 -

Financial Overview

I. Condensed balance sheets, statements of income, names of CPAs, and audit opinions for the last 5 years

(I) Condensed consolidated balance sheet and statements of income

Condensed consolidated balance sheet

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Unit: NT$1,000
Financial information for the past 5 years
Item\Year
2018 2019 2020 2021 2022
Current assets 37,528,246 37,557,286 47,530,801 72,506,733 68,537,523
Property, plant, and equipment 52,484,183 56,977,114 61,452,516 61,079,605 93,806,639
Intangible assets 229,195 407,722 891,380 1,072,985 782,603
Other assets 5,800,840 9,862,778 16,168,543 18,080,961 21,038,228
Total Assets 96,042,464 104,804,900 126,043,240 152,740,284 184,164,993
Before distribution 16,469,744 17,515,468 25,475,006 28,644,931 27,776,754
Current liabilities
After distribution 20,449,744 17,913,468 26,271,006 32,624,931 31,756,754 (Note 2)
Non-current liabilities 15,681,623 23,432,245 29,975,547 34,061,841 53,654,523
Before distribution 32,151,367 40,947,713 55,450,553 62,706,772 81,431,277
Total liabilities
After distribution 36,131,367 41,345,713 56,246,553 66,686,772 85,411,277 (Note 2)
Equity attributable to owners of parent 62,444,371 61,020,622 65,449,119 82,444,113 94,162,996
Capital 39,800,002 39,800,002 39,800,002 39,800,002 39,800,002
Capital surplus 7,540,440 7,536,396 7,770,865 7,786,124 7,785,918
Before distribution 11,621,286 8,793,542 10,008,070 22,808,020 32,215,117
Accumulated profit (loss)
After distribution 7,641,286 8,395,542 9,212,070 18,828,020 28,235,117 (Note 2)
Other interests 3,482,643 4,890,682 7,870,182 12,049,967 14,361,959
Treasury stock - - - - -
Non-controlling interests 1,446,726 2,836,565 5,143,568 7,589,399 8,570,720
Before distribution 63,891,097 63,857,187 70,592,687 90,033,512 102,733,716
Total equity
After distribution 59,911,097 63,459,187 69,796,687 86,053,512 98,753,716 (Note 2)
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Notes:

The above financial information was audited and certified by the CPA. The 2022 financial report has been approved by the Board of Directors, but has not yet been submitted to the shareholders meeting.
The dividends were approved by the Board of Directors on March 14, 2023.

2. Condensed consolidated income statement

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Unit: NT$1,000
Financial information for the past 5 years
Item\Year
2018 2019 2020 2021 2022
Operating revenue 51,190,323 48,771,434 60,683,171 99,569,924 94,529,790
Gross profit 19,151,103 12,913,852 17,040,136 42,481,067 43,051,083
Operating profit 7,926,697 1,255,209 1,627,291 18,427,922 16,534,581
Non-operating income and expenses 468,203 497,308 185,117 (204,832) 1,511,591
Net income (loss) before tax 8,394,900 1,752,517 1,812,408 18,223,090 18,046,172
Less income tax expense 667,242 275,230 293,365 3,222,968 3,059,620
Current period net profit 7,727,658 1,477,287 1,519,043 15,000,122 14,986,552
Other comprehensive income for the current period (1,738,472) 1,294,756 3,291,251 4,186,931 2,717,903
Total comprehensive income for the current period 5,989,186 2,772,043 4,810,294 19,187,053 17,704,455
Net profit attributable to owners of parent 7,446,496 1,256,387 1,304,019 13,594,643 12,927,165
Net profit attributable to noncontrolling interests 281,162 220,900 215,024 1,405,479 2,059,387
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Financial information for the past 5 years
Item\Year
2018 2019 2020 2021 2022
Total comprehensive income attributable to owners of parent 5,810,825 2,560,295 4,592,028 17,775,735 15,699,089
Total comprehensive income attributable to non-controlling interests 178,361 211,748 218,266 1,411,318 2,005,366
Earnings per share (NT$) 1.87 0.32 0.33 3.42 $3.25
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Note: The above financial information was audited and certified by the CPA. The 2022 financial report has been approved by the Board of Directors, but has not yet been submitted to the shareholders meeting.

(II) Condensed standalone balance sheet and income statement

Condensed standalone balance sheet

Unit: NT$1,000

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Financial information for the past 5 years
Item\Year
2018 2019 2020 2021 2022
Current assets 31,188,039 27,470,545 27,459,041 48,915,599 42,250,662
Property, plant, and equipment 51,577,630 55,691,405 54,399,180 55,352,300 87,575,274
Intangible assets 104,925 123,949 57,563 43,999 18,158
Other assets 9,303,235 14,963,032 18,137,516 21,632,681 26,162,500
Total Assets 92,173,829 98,248,931 100,053,300 125,944,579 156,006,594
Before distribution 14,638,436 15,267,599 13,992,019 18,688,022 16,711,449
Current liabilities
After distribution 18,618,436 15,665,599 14,788,019 22,668,022 20,691,449 (Note 2)
Non-current liabilities 15,091,022 21,960,710 20,612,162 24,812,444 45,132,149
Before distribution 29,729,458 37,228,309 34,604,181 43,500,466 61,843,598
Total liabilities
After distribution 33,709,458 37,626,309 35,400,181 47,480,466 65,823,598 (Note 2)
Capital 39,800,002 39,800,002 39,800,002 39,800,002 39,800,002
Capital surplus 7,540,440 7,536,396 7,770,865 7,786,124 7,785,918
Before distribution 11,621,286 8,793,542 10,008,070 22,808,020 32,215,117
Accumulated profit (loss)
After distribution 7,641,286 8,395,542 9,212,070 18,828,020 28,235,117 (Note 2)
Other interests 3,482,643 4,890,682 7,870,182 12,049,967 14,361,959
Before distribution 62,444,371 61,020,622 65,449,119 82,444,113 94,162,996
Total equity
After distribution 58,464,371 60,622,622 64,653,119 78,464,113 90,182,996 (Note 2)
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Notes:

The above financial information has been audited and certified by the CPA. The 2022 financial report has been approved by the Board of Directors, but has not yet been submitted to the shareholders meeting.
The dividends were approved by the Board of Directors on March 14, 2023.

3. Condensed standalone income statement

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Unit: NT$1,000
Financial information for the past 5 years
Item\Year
2018 2019 2020 2021 2022
Operating revenue 40,733,527 37,884,848 39,649,875 57,532,802 51,139,171
Gross profit 14,781,238 8,239,412 8,807,169 24,757,188 23,958,018
Operating profit 6,943,927 379,841 1,090,583 14,678,137 11,484,680
Non-operating income and expenses 993,089 980,011 259,243 1,362,609 3,447,491
Net income (loss) before tax 7,937,016 1,359,852 1,349,826 16,040,746 14,932,171
Less Income tax expense 490,520 103,465 45,807 2,446,103 2,005,006
Current period net profit 7,446,496 1,256,387 1,304,019 13,594,643 12,927,165
Other comprehensive income for the current period (1,635,671) 1,303,908 3,288,009 4,181,092 2,771,924
Total comprehensive income for the current period 5,810,825 2,560,295 4,592,028 17,775,735 15,699,089
Earnings per share (NT$) 1.87 0.32 0.33 3.42 3.25
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(III) Names of CPAs and audit opinions of the last 5 years

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Year CPA Name Audit opinion
2018 Kenny Hung Hung-Bin Yu Unqualified opinion
2019 Wen-Yea Shyu Hung-Bin Yu Unqualified opinion
2020 Wen-Yea Shyu Hung-Bin Yu Unqualified opinion
2021 Kenny Hung Wen-Yea Shyu Unqualified opinion
2022 Kenny Hung Wen-Yea Shyu Unqualified opinion
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II. Financial analysis of the last 5 years

1. Financial ratio analysis of consolidated financial statements

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Item\Year Financial information for the past 5 years
2018 2019 2020 2021 2022
Debt-to-asset ratio (%) 33.47 39.07 43.99 41.05 44.21
Financial structure
Long-term funds in PP&E (fixed asset) ratio (%) 151.61 153.20 163.65 203.16 166.71
Current ratio (%) 227.86 214.42 186.57 253.12 246.74
Solvency Quick ratio (%) 156.31 150.85 128.17 193.89 164.77
Times interest earned 47.05 9.00 7.11 89.51 191.21
Receivables turnover ratio (times) 7.72 7.71 7.62 9.07 8.58
Average collection period (days) 47 47 48 40 43
Inventory turnover rate (times) 3.36 3.37 3.56 3.79 2.75
Operating capacity Payables turnover ratio (times) 6.49 6.73 6.26 7.20 7.35
Average sale period (days) 109 108 102 96 133
Property, plant and equipment turnover ratio (times) 1.06 0.89 1.02 1.62 1.22
Total assets turnover ratio (times) 0.55 0.48 0.52 0.71 0.56
Return on assets (%) 8.55 1.64 1.52 10.87 8.94
Return on equity (%) 12.31 2.31 2.25 18.67 15.54
Profitability Income before tax to paid-in capital ratio (%) 21.09 4.40 4.55 45.78 45.34
Net profit margin (%) 15.09 3.02 2.50 15.06 15.85
Earnings per share (NT$) 1.87 0.32 0.33 3.42 3.25
Cash flow ratio (%) 82.17 60.38 43.64 106.04 56.50
Cash flow Cash flow adequacy ratio (%) 78.21 75.01 77.35 95.71 70.94
Cash reinvestment ratio (%) 5.19 3.30 3.66 9.35 3.31
Operating leverage 3.07 16.22 14.26 2.65 2.95
Leverage
Financial leverage 1.02 1.21 1.22 1.01 1.00
Reasons for changes in financial ratios exceeding 20%:
1. Time interest earned: Mainly due to the capitalization of interest expenses related to plant construction debt, which resulted in a decrease in
interest expenses.
2. Decreases in the inventory turnover rate, property, plant and equipment turnover ratio, total assets turnover ratio, cash flow ratio, cash flow
adequacy ratio, and cash reinvestment ratio: mainly due to a decrease in market demand and decline in sales.
3. Prolonged average sale period (days): primarily due to weakened market demand and declining sales volume.
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Note: Financial ratios were computed based on audited financial information. The computation formulas used in the financial analysis:

Financial structure

(1) Ratio of liabilities to assets = Total liabilities/Total assets

(2) Ratio of long-term capital to real estate properties, factories, and equipment = (Total equity + Non-current liabilities)/net amount of real estate properties, factories, and equipment

Solvency
(1) Current ratio = current assets / current liabilities
(2) Quick Ratio = (Current assets - Inventories-Prepaid expenses)/Current liabilities
(3) Times interest earned = net income before income tax and interest expense / current interest expense
Operating capacity
(1) Receivable (including accounts receivable and business-related notes receivable) turnover ratio = net operating revenue / average balance of receivables for the period (including accounts receivable and business-related notes receivable)

(2) Average days of collection = 365 / receivables turnover ratio

(3) Inventory turnover ratio = cost of goods sold / average inventory amount
(4) Payable (including accounts payable and business-related notes payable) turnover ratio = cost of goods sold / average balance of payables for the period (including accounts payable and business-related notes payable).
(5) Average sale period = 365 / inventory turnover ratio.

(6) Turnover of real estate properties, factories, and equipment = net sales/average net amount of real estate properties, factories, and equipment

(7) Total assets turnover = net sales/average total assets

Profitability

(1) Return on assets = [after-tax profit + interest cost (1-tax rate)] / average total assets

(2) ROE = income after tax/net average equity
(3) Net profit margin = after-tax profit / net operating income
(4) Earnings per share = (income attributable to owners of parent – dividends paid to preferred stock) / weighted average of shares issued
1. Cash flow
(1) Cash flow ratio = cash flows from operating activities / current liabilities
(2) Cash flow adequacy ratio = net cash flows from operating activities in the past 5 years / (capital expenditure + increase in inventory + cash dividend) in the past 5 years

(3) Cash reinvestment ratio = (net cash flow of operating activities - cash dividend)/ (gross amount of real estate properties, factories, and equipment + long-term investment + other non-current assets + operating capital)

Leverage:
(1) Operating leverage＝(net operating revenue – variable operating costs and expenses) / operating income
(2) Financial leverage = operating income / (operating income – interest expense)

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2. Financial ratio analysis of individual financial statements

Item\Year		Financial information of the last 5 years
		2018 2019 2020 2021 2022
Financial structure	Debt-to-asset ratio(%)	32.25 37.89 34.58 34.53 39.64
	Long-term fund to PP&E(fixed asset)ratio(%)	150.32 149.00 158.20 193.77 159.05
Solvency	Current ratio(%)	213.05 179.92 196.24 261.74 252.82
	Quick ratio(%)	144.61 118.37 136.26 208.91 169.69
	Times interest earned	44.53 7.66 7.00 118.80 251.84
	Receivables turnover ratio(times)	7.60 7.93 8.50 9.27 8.33
	Average collectionperiod(days)	48 46 43 39 44
	Inventoryturnover rate(times)	3.27 3.27 3.70 3.82 2.44
Operating capacity	Payables turnover ratio(times)	6.42 6.85 6.84 7.34 7.01
	Average salesperiod(days)	112 112 99 96 150
	Property, plant,and equipment turnover ratio(times)	0.86 0.70 0.72 1.04 0.71
	Total assets turnover ratio(times)	0.46 0.39 0.39 0.50 0.36
	Return on assets(%)	8.59 1.49 1.49 12.12 9.20
	Return on equity (%)	12.14 2.03 2.06 18.38 14.63
Profitability	Income before tax topaid-in capital ratio(%)	19.94 3.41 3.39 40.30 37.51
	Netprofit margin(%)	18.28 3.31 3.28 23.62 25.27
	Earningsper share(NT$)	1.87 0.32 0.33 3.42 3.25
	Cash flow ratio(%)	87.70 66.35 71.31 130.13 78.39
Cash flow	Cash flow adequacyratio(%)	76.54 73.83 75.06 88.23 64.25
	Cash reinvestment ratio(%)	5.31 3.41 5.01 10.57 3.49
	Operatingleverage	2.92 42.17 14.22 2.17 2.65
Leverage	Financial leverage	1.02 2.16 1.25 1.00 1.00
Reasons for changes in financial ratios exceeding 20%: (1) Increase in times interest earned: Mainly due to the higher capitalization of interest expenses in 2022. (2) Decreases in inventory turnover rate, average sales period, property, plant, and equipment turnover ratio, total assets turnover ratio, return of assets, cash flow ratio, cash flow adequacy ratio, and cash reinvestment ratio: Mainly due to a decline in sales and increases in inventory and capital expenditures. (3) Prolonged average sale period (days): primarily due to weakened market demand and declining sales volume. (4) Increase in operatingleverage:primarilydue to decreased sales in 2022

Note: Financial ratios were computed based on audited financial information. The computation formulas used in financial analysis: 1. Financial structure
(1) Ratio of liabilities to assets = Total liabilities/Total assets
(2) Ratio of long-term capital to real estate properties, factories, and equipment = (Total equity + Non-current liabilities)/net amount of real estate properties, factories, and equipment
Solvency
(1) Current ratio = current assets / current liabilities
(2) Quick Ratio = (Current assets - Inventories-Prepaid expenses)/Current liabilities
(3) Times interest earned = net income before income tax and interest expense / current interest expense
Operating capacity
(1) Receivable (including accounts receivable and business-related notes receivable) turnover ratio = net operating revenue / average balance of receivables for the period (including accounts receivable and business-related notes receivable)
(2) Average collection period = 365 / receivables turnover ratio
(3) Inventory turnover ratio = cost of goods sold / average inventory amount
(4) Payable (including accounts payable and business-related notes payable) turnover ratio = cost of goods sold / average balance of payables for the period (including accounts payable and business-related notes payable)
(5) Average sales period = 365 / inventory turnover ratio
(6) Turnover of real estate properties, factories, and equipment = net sales/average net amount of real estate properties, factories, and equipment
(7) Total assets turnover = net sales/average total assets
Profitability
(1) Return on assets = [after-tax profit + interest cost (1-tax rate)] / average total assets
(2) ROE = income after tax/net average equity
(3) Net profit margin = after-tax profit / net operating income
(4) Earnings per share = (income attributable to owners of parent – dividends paid to preferred stock) / weighted average of shares issued
Cash flow
(1) Cash flow ratio = cash flows from operating activities / current liabilities
(2) Cash flow adequacy ratio = net cash flows from operating activities in the past 5 years / (capital expenditure + increase in inventory + cash dividends) in the past 5 years
(3) Cash reinvestment ratio = (net cash flow of operating activities - cash dividends) / (gross amount of real estate properties, factories, and equipment + long-term investment + other non-current assets + operating capital)
Leverage:
(1) Operating leverage＝(net operating revenue – variable operating costs and expenses) / operating income
(2) Financial leverage = operating income / (operating income – interest expense)

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III. Report of the Audit Committee on the 2022 Financial Report

Report of the Audit Committee

We have examined the 2022 financial statements (including consolidated financial statements) together with the business report and earnings distribution proposal prepared by the Board of Directors and audited and certified by CPAs Kenny Hong and Wen-Yea Shyu of Deloitte & Touche, who issued an unqualified opinion, and have found no discrepancies. The aforesaid financial statements, business report, and earnings distribution proposal have been reviewed by the Audit Committee and all content was found to be appropriate. We therefore submit it for your review in accordance with Article 14-4 of the Securities Exchange Act and Article 219 of the Company Act.

T o :

Winbond Electronics Corp. 2023 General Shareholders Meeting

Winbond Electronics Corporation

Convenor of Audit Committee: Allen Hsu

March 14, 2023

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Winbond Electronics Corporation and Subsidiaries

Consolidated Financial Statements for the Years Ended December 31, 2022 and 2021 and Independent Auditors’ Report

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DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

The companies that are required to be included in the consolidated financial statements of affiliates in accordance with the “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” for the year ended December 31, 2022 are all the same as the companies required to be included in the consolidated financial statements of parent and subsidiary companies as provided in International Financial Reporting Standard 10 “Consolidated Financial Statements”. Relevant information that should be disclosed in the consolidated financial statements of affiliates has all been disclosed in the consolidated financial statements of parent and subsidiary companies. Hence, we do not prepare a separate set of consolidated financial statements of affiliates.

Very truly yours,

WINBOND ELECTRONICS CORPORATION

YU-CHENG CHIAO Chairman

February 16, 2023

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Occurrence of Sales Revenue from Specific Series of Flash Memory Products

The sales revenue of Winbond Electronics Corporation and its subsidiaries are mainly from the sale of DRAM IC products, Flash Memory products and Logic IC products.

As the gross profit margin and the proportion of sales revenue from the specific series of flash memory products are higher than that of other product series, and given that the gross profit of the specific series is significant to the net income of the year, we considered the occurrence of sales revenue from specific series of products as a key audit matter of the Company’s consolidated financial statements for the year ended December 31, 2022.

The audit procedures that we performed in response to the abovementioned key audit matter included understanding the design and implementation of the key internal controls and testing the effectiveness of the relevant controls over sales revenue, and selecting samples of revenue items to verify the occurrence of the transactions.

Other Matter

We have also audited the parent company only financial statements of Winbond Electronics Corporation as of and for the years ended December 31, 2022 and 2021, on which we have issued an unmodified opinion.

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

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

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

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

3 - - 79 -

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

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the group audit. We remain solely responsible for our audit opinion.

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements for the year ended December 31, 2022 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.

4 - - 80 -
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WINBOND ELECTRONICS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 4 and 6) Current financial assets at fair value through profit or loss (Notes 4 and 7) Current financial assets at fair value through other comprehensive income (Notes 4 and 8) Accounts receivable, net (Notes 4 and 9) Accounts receivable due from related parties, net (Note 31) Finance lease receivables - current (Notes 4, 10 and 31) Other receivables (Notes 11 and 31) Inventories (Notes 4, 5 and 12) Other current assets Total current assets NON-CURRENT ASSETS Non-current financial assets at fair value through profit or loss (Notes 4 and 7) Non-current financial assets at fair value through other comprehensive income (Notes 4 and 8) Investments accounted for using equity method (Notes 4 and 13) Property, plant and equipment (Notes 4 and 14) Right-of-use assets (Notes 4 and 15) Investment properties (Notes 4 and 16) Intangible assets (Notes 4 and 17) Deferred income tax assets (Notes 4 and 25) Finance lease receivables - non-current (Notes 4, 10 and 31) Other non-current assets (Notes 6 and 31) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 18) Current financial liabilities at fair value through profit or loss (Notes 4 and 7) Notes and accounts payable Accounts payable due to related parties (Note 31) Payables on machinery and equipment Other payables (Note 31) Current tax liabilities (Notes 4 and 25) Provisions - current (Notes 4 and 20) Lease liabilities - current (Notes 4 and 15) Long-term borrowings - current portion (Note 18) Other current liabilities (Note 31) Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Notes 4 and 19) Long-term borrowings (Notes 18 and 27) Provisions - non-current (Notes 4 and 20) Lease liabilities - non-current (Notes 4 and 15) Net defined benefit liabilities - non-current (Notes 4 and 21) Other non-current liabilities (Note 31) Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT (Notes 4 and 22) Share capital Capital surplus Retained earnings Legal reserve Unappropriated earnings Exchange differences on translation of the financial statements of foreign operations Unrealized gains on financial assets measured at fair value through other comprehensive income Total equity attributable to owners of the parent NON-CONTROLLING INTERESTS Total equity TOTAL		2022		2021
		Amount % $ 20,402,936 11 223,532 - 14,587,832 8 9,137,746 5 735,659 - 96,731 - 558,836 - 21,448,078 12 1,346,173 1 68,537,523 37 121,775 - 3,056,829 2 9,971,440 5 93,806,639 51 2,224,481 1 1,798,160 1 782,603 1 1,191,547 1 123,451 - 2,550,545 1 115,627,470 63 $ 184,164,993 100 $ 1,069,040 - 7,412 - 5,202,743 3 1,188,928 1 3,535,586 2 9,735,007 5 2,123,413 1 132,473 - 276,015 - 3,171,429 2 1,334,708 1 27,776,754 15 9,968,462 5 34,278,073 19 2,733,351 2 2,052,762 1 1,892,594 1 2,729,281 1 53,654,523 29 81,431,277 44 39,800,002 22 7,785,918 4 3,434,165 2 28,780,952 15 (654,652) - 15,016,611 8 94,162,996 51 8,570,720 5 102,733,716 56 $ 184,164,993 100		Amount % $ 30,914,427 20 215,748 - 10,977,904 7 11,515,593 8 639,262 - - - 1,267,026 1 15,940,688 10 1,036,085 1 72,506,733 47 69,200 - 3,481,435 2 8,286,463 5 61,079,605 40 2,796,920 2 2,005,598 1 1,072,985 1 774,072 1 - - 667,273 1 80,233,551 53 $ 152,740,284 100 $ 1,430,417 1 - - 6,256,539 4 1,344,195 1 4,462,326 3 9,946,855 6 2,704,871 2 532,948 - 333,791 - 785,000 1 847,989 1 28,644,931 19 9,956,086 6 13,348,865 9 2,966,575 2 2,682,609 2 2,621,015 2 2,486,691 1 34,061,841 22 62,706,772 41 39,800,002 26 7,786,124 5 2,074,570 1 20,733,450 14 (861,389) (1) 12,911,356 9 82,444,113 54 7,589,399 5 90,033,512 59 $ 152,740,284 100

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

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WINBOND ELECTRONICS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 4, 23 and 31) OPERATING COSTS (Notes 12 and 31) GROSS PROFIT OPERATING EXPENSES (Note 31) Selling expenses General and administrative expenses Research and development expenses Expected credit (gain) loss (Note 9) Total operating expenses INCOME FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES Interest income (Note 31) Dividend income (Note 31) Other income (Notes 15, 27 and 31) Share of profit (loss) of associates Gains (losses) on disposal of property, plant and equipment (Note 31) Gains (losses) on disposal of intangible assets (Note 31) Gains (losses) on disposal of investments Gains (losses) on disposal of non-current held for sale assets Gains (losses) on foreign exchange (Note 34) Gains (losses) on financial instruments at fair value through profit or loss Interest expense (Notes 15, 27 and 31) Other expenses (Note 31) Impairment loss recognized on property, plant and equipment Total non-operating income and expenses INCOME BEFORE INCOME TAX INCOME TAX EXPENSE (Notes 4 and 25) NET INCOME		2022 Amount % $ 94,529,790 100 51,478,707 54 43,051,083 46 2,547,825 3 8,301,233 9 15,818,706 17 (151,262) - 26,516,502 29 16,534,581 17 154,580 - 634,979 1 540,182 1 512,295 1 357,146 - 91 - - - 36,181 - 968,662 1 (962,983) (1) (94,874) - (522,402) (1) (112,266) - 1,511,591 2 18,046,172 19 3,059,620 3 14,986,552 16		2021
				Amount % $ 99,569,924 100 57,088,857 58 42,481,067 42 2,572,816 3 6,044,264 6 15,379,855 15 56,210 - 24,053,145 24 18,427,922 18 58,948 - 404,585 - 477,608 1 197,908 - 174,642 - (4,803) - (436) - 30,371 - (106,710) - 64,345 - (205,883) - (512,458) - (782,949) (1) (204,832) - 18,223,090 18 3,222,968 3 15,000,122 15 (Continued)

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WINBOND ELECTRONICS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME (LOSS) Components of other comprehensive income (loss) that will not be reclassified to profit or loss: Gains (losses) on remeasurement of defined benefit plans (Note 21) Unrealized gains (losses) from investments in equity instruments at fair value through other comprehensive income Share of other comprehensive income (loss) of associates accounted for using the equity method Income tax expense related to remeasurement of defined benefit plans Components of other comprehensive income (loss) that will be reclassified to profit or loss: Exchange differences on translation of the financial statements of foreign operations Other comprehensive income (loss) TOTAL COMPREHENSIVE INCOME NET INCOME ATTRIBUTABLE TO: Owners of the parent Non-controlling interests TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO: Owners of the parent Non-controlling interests EARNINGS PER SHARE (Note 26) Basic Diluted		2022 Amount % $ 215,816 - 2,811,664 3 (529,691) - (5,812) - 225,926 - 2,717,903 3 $ 17,704,455 19 $ 12,927,165 14 2,059,387 2 $ 14,986,552 16 $ 15,699,089 17 2,005,366 2 $ 17,704,455 19 $ 3.25 $ 3.23		2021
				Amount % $ (116,564) - 3,417,063 3 1,901,619 2 - - (1,015,187) (1) 4,186,931 4 $ 19,187,053 19 $ 13,594,643 14 1,405,479 1 $ 15,000,122 15 $ 17,775,735 18 1,411,318 1 $ 19,187,053 19 $ 3.42 $ 3.41

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

(Concluded)

8 - - 84 -

									Total Equity	$ 70,592,687		-	(796,000)	(796,000)	15,000,122	4,186,931	19,187,053	1,198,560		-	(148,788)	90,033,512		-	(3,980,000)	(3,980,000)	14,986,552	2,717,903	17,704,455	16	(214)		-	(1,024,053)	$ 102,733,716
								Non-controlling	Interests	$ 5,143,568		-	-	-	1,405,479	5,839	1,411,318	1,183,301		-	(148,788)	7,589,399		-	-	-	2,059,387	(54,021)	2,005,366	8	-		-	(1,024,053)	$ 8,570,720
									Total	65,449,119		-	(796,000)	(796,000)	13,594,643	4,181,092	17,775,735	15,259		-	-	82,444,113		-	(3,980,000)	(3,980,000)	12,927,165	2,771,924	15,699,089	8	(214)		-	-	94,162,996
										$																									$
Equity Attributable to Owners of the Parent	Other Equity	Unrealized Gains	(Losses) on	Exchange Financial Assets	Differences on Measured at Fair	Translation of the Value Through	Retained Earnings Financial Other	Unappropriated Statements of Comprehensive	Legal Reserve Earnings Foreign Operations Income	$ 1,913,317 $ 8,094,753 $ (271,328) $ 8,141,510		161,253 (161,253) - -	- (796,000) - -	161,253 (957,253) - -	- 13,594,643 - -	- (92,951) (590,061) 4,864,104	- 13,501,692 (590,061) 4,864,104	- - - -		- 94,258 - (94,258)	- - - -	2,074,570 20,733,450 (861,389) 12,911,356		1,359,595 (1,359,595) - -	- (3,980,000) - -	1,359,595 (5,339,595) - -	- 12,927,165 - -	- 159,408 206,737 2,405,779	- 13,086,573 206,737 2,405,779	- - - -	- - - -		- 300,524 - (300,524)	- - - -	$ 3,434,165 $ 28,780,952 $ (654,652) $ 15,016,611		- 9 -
									Capital Surplus	$ 7,770,865		-	-	-	-	-	-	15,259		-	-	7,786,124		-	-	-	-	-	-	8	(214)		-	-	$ 7,785,918
									Share Capital	$ 39,800,002		-	-	-	-	-	-	-		-	-	39,800,002		-	-	-	-	-	-	-	-		-	-	$ 39,800,002
										BALANCE AT JANUARY 1, 2021	Appropriation of 2020 earnings (Note 22)	Legal reserve appropriated	Cash dividends	Total appropriations	Net income for the year ended December 31, 2021	Other comprehensive income (loss) for the year ended December 31, 2021	Total comprehensive income (loss) for the year ended December 31, 2021	Changes in ownership interests in subsidiaries	Disposal of investments in equity instruments designated at fair value through other	comprehensive income (Notes 8 and 22)	Cash dividends distributed by subsidiaries (Note 22)	BALANCE AT DECEMBER 31, 2021	Appropriation of 2021 earnings (Note 22)	Legal reserve appropriated	Cash dividends	Total appropriations	Net income for the year ended December 31, 2022	Other comprehensive income (loss) for the year ended December 31, 2022	Total comprehensive income (loss) for the year ended December 31, 2022	Changes in ownership interests in subsidiaries	Changes in equity of associates accounted for using equity method	Disposal of investments in equity instruments designated at fair value through other	comprehensive income (Notes 8 and 22)	Cash dividends distributed by subsidiaries (Note 22)	BALANCE AT DECEMBER 31, 2022	The accompanying notes are an integral part of the consolidated financial statements.

85 -

WINBOND ELECTRONICS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expense Amortization expense Carbon offset Expected credit (gain) loss recognized on accounts receivable (Gains) losses on financial assets and liabilities at fair value through profit or loss Interest expense Interest income Dividend income Share of (profit) loss of associates (Gains) losses on disposal of property, plant and equipment (Gains) losses on disposal of non-current held for sale assets (Gains) losses on disposal of investments (Gains) losses on disposal of intangible assets Impairment loss on property, plant and equipment Gains on lease modification Changes in operating assets and liabilities (Increase) decrease in financial assets and liabilities at fair value through profit or loss (Increase) decrease in accounts receivable (Increase) decrease in accounts receivable due from related parties (Increase) decrease in other receivables (Increase) decrease in inventories (Increase) decrease in other current assets (Increase) decrease in other non-current assets Increase (decrease) in notes and accounts payable Increase (decrease) in accounts payable due to related parties Increase (decrease) in other payables Increase (decrease) in other current liabilities Increase (decrease) in other non-current liabilities Cash flows generated by (used in) operations Interest received Dividends received Interest paid Income taxes paid Net cash flows generated by (used in) operating activities	2022 $ 18,046,172 9,195,254 354,103 174 (151,262) 10,041 94,874 (154,580) (634,979) (512,295) (357,146) (36,181) - (91) 112,266 (111,231) 51,928 2,452,548 (96,397) 540,209 (5,507,390) (310,088) (1,859,498) (1,053,285) (155,267) 140,930 308,338 (964,949) 19,402,198 150,955 726,400 (552,169) (4,031,232) 15,696,152	2021 $ 18,223,090 11,361,984 293,856 - 56,210 1,058 205,883 (58,948) (404,585) (197,908) (174,642) (30,371) 436 4,803 782,949 (15) (19,867) (1,845,248) (561,502) 294,673 (1,799,274) (297,781) (774) (314,890) (321,808) 3,818,970 325,658 (303,820) 29,038,137 53,059 459,437 (436,963) (720,486) 28,393,184 (Continued)

10 - - 86 -

WINBOND ELECTRONICS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of investments accounted for using equity method Acquisitions of financial assets at fair value through profit or loss Acquisitions of financial assets at fair value through other comprehensive income Proceeds from disposal of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Net cash flow from acquisition of subsidiaries Proceeds from disposal of non-current held for sale assets Acquisitions of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisitions of right-of-use assets (Increase) decrease in refundable deposits (Increase) decrease in other receivables - time deposits Acquisitions of intangible assets Proceeds from disposal of intangible assets Increase (decrease) in investment payable (Increase) decrease in finance lease receivables Net cash flows generated by (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase (decrease) in short-term borrowings Proceeds from long-term borrowings Repayments of long-term borrowings Cash dividends paid Change in non-controlling interests Repayments of lease liabilities Increase (decrease) in guarantee deposits Net cash flows generated by (used in) financing activities EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	2022 $ (568,772) (96,958) (1,521,393) 18,535 1,000 - 55,200 (42,164,653) 369,674 (2,167) (29,160) 128,267 (381,342) 356 (362,643) 71,848 (44,482,208) (361,377) 23,150,000 - (3,980,000) (1,024,053) (339,177) 433,932 17,879,325 395,240 (10,511,491) 30,914,427 $ 20,402,936	2021 $ - (178,957) (219,676) 310,667 4,500 (77,934) 279,897 (9,819,828) 959,954 - 442,799 13,008 (314,310) - - - (8,599,880) (390,793) 4,931,600 (5,000,000) (796,000) (148,788) (381,264) 1,982,200 196,955 (820,138) 19,170,121 11,744,306 $ 30,914,427

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

(Concluded)

11 - - 87 -

WINBOND ELECTRONICS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

1. GENERAL INFORMATION

Winbond Electronics Corporation (the “Company”) was incorporated in the Republic of China (ROC) in September 1987 and is engaged in the design, development, manufacture and marketing of Very Large Scale Integration (VLSI) integrated circuits (ICs) used in a variety of microelectronic applications.

The Company’s shares have been listed on the Taiwan Stock Exchange Corporation since October 18, 1995.

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

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved by the board of directors on February 16, 2023.

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

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

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

b. The IFRSs endorsed by the FSC for application starting from 2023

The IFRSs endorsed by the FSC for application starting from 2023
New IFRSs Amendments to IAS 1 “Disclosure of Accounting Policies” Amendments to IAS 8 “Definition of Accounting Estimates” Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”	Effective Date Announced by IASB
	January 1, 2023 (Note 1) January 1, 2023 (Note 2) January 1, 2023 (Note 3)

Note 1: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.
Note 2: The amendments will be applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.
Note 3: Except for deferred taxes that were recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments were applied prospectively to transactions that occur on or after January 1, 2022.
12 -
88 -

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

c. New IFRSs in issue but not yet endorsed and issued into effect by the FSC

Effective Date Announcedouncedncedced by IASB (Note 1)

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

Note 1: Unless stated otherwise, the above IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.
Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and leaseback transactions entered into after the date of initial application of IFRS 16.

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Statement of Compliance

The consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRSs as endorsed and issued into effect by the FSC.

Basis of Preparation

The consolidated financial statements have been prepared on the historical cost basis except for financial instruments and defined benefit liabilities which are measured at the present value of the defined benefit obligation less the fair value of plan assets. Historical cost is generally based on the fair value of the consideration given in exchange for assets.

13 - - 89 -

Basis of Consolidation

a. Principles for preparing consolidated financial statements

The consolidated financial statements incorporate the financial statements of the Company and the entities controlled by the Company. Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statement of comprehensive income from the effective dates of acquisitions up to the effective dates of disposals, as appropriate. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation.

- Attribution of total comprehensive income to non controlling interests

Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Changes in the Group’s ownership interests in existing subsidiaries

Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the interests of the Group and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to the owners of the Company.

b. Subsidiaries included in consolidated financial statements

Investor Investee Main Business The Company Winbond International Corporation (“WIC”) Investment holding The Company Landmark Group Holdings Ltd. (“Landmark”) Investment holding The Company Winbond Electronics Corporation Japan (“WECJ”) (Note 1) Research, development, sales and after-sales service of semiconductor The Company Winbond Electronics (HK) Limited (“WEHK”) Sales of semiconductor and investment holding The Company Pine Capital Investment Limited (“PCI”) Investment holding The Company Winbond Technology Ltd. (“WTL”) Design and service of semiconductor The Company Callisto Holding Limited (“Callisto”) Electronic commerce and investment holding The Company Winbond Electronics Germany GmbH (“WEG”) Marketing service of semiconductor The Company Great Target Development Ltd. (“GTD”) Investment holding The Company Miraxia Edge Technology Corporation (“METC”) (Note 2) Software and hardware integration design of semiconductor The Company Nuvoton Technology Corporation (“NTC”) Research, design, development, manufacture and marketing of Logic IC, 6 inch wafer product, test, and OEM WIC Winbond Electronics Corporation America (“WECA”) Design, sales and service of semiconductor Landmark Winbond Electronics Corporation Japan (“WECJ”) (Note 1) Research, development, sales and after-sales service of semiconductor WEHK Winbond Electronics (Suzhou) Limited (“WECN”) Design, development and marketing of VLSI integrated ICs Callisto Callisto Technology Limited (“CTL”) Electronic commerce and investment holding GTD GLMTD Technology Private Limited (“GLMTD”) Sales and service of semiconductor METC Miraxia Technology Taiwan Corporation (“MTTC”) (Note 3) Development of software and services for automotive and industrial control NTC Marketplace Management Limited (“MML”) Investment holding NTC Nuvoton Technology Corporation America (“NTCA”) Design, sales and service of semiconductor NTC Nuvoton Investment Holding Ltd. (“NIH”) Investment holding	% of Ownership
	December 31
	2022 2021 100.00 100.00 100.00 100.00 100.00 - 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 51.00 51.00 100.00 100.00 - 100.00 100.00 100.00 100.00 100.00 99.99 99.99 100.00 - 100.00 100.00 100.00 100.00 100.00 100.00

Investor
Investee
Main Business
The Company
Winbond International Corporation (“WIC”)
Investment holding
The Company
Landmark Group Holdings Ltd. (“Landmark”)
Investment holding
The Company
Winbond Electronics Corporation Japan
(“WECJ”) (Note 1)
Research, development, sales and
after-sales service of semiconductor
The Company
Winbond Electronics (HK) Limited (“WEHK”)
Sales of semiconductor and investment
holding
The Company
Pine Capital Investment Limited (“PCI”)
Investment holding
The Company
Winbond Technology Ltd. (“WTL”)
Design and service of semiconductor
The Company
Callisto Holding Limited (“Callisto”)
Electronic commerce and investment
holding
The Company
Winbond Electronics Germany GmbH (“WEG”)
Marketing service of semiconductor
The Company
Great Target Development Ltd. (“GTD”)
Investment holding
The Company
Miraxia Edge Technology Corporation
(“METC”) (Note 2)
Software and hardware integration design
of semiconductor
The Company
Nuvoton Technology Corporation (“NTC”)
Research, design, development,
manufacture and marketing of Logic IC,
6 inch wafer product, test, and OEM
WIC
Winbond Electronics Corporation America
(“WECA”)
Design, sales and service of semiconductor
Landmark
Winbond Electronics Corporation Japan
(“WECJ”) (Note 1)
Research, development, sales and
after-sales service of semiconductor
WEHK
Winbond Electronics (Suzhou) Limited
(“WECN”)
Design, development and marketing of
VLSI integrated ICs
Callisto
Callisto Technology Limited (“CTL”)
Electronic commerce and investment
holding
GTD
GLMTD Technology Private Limited
(“GLMTD”)
Sales and service of semiconductor
METC
Miraxia Technology Taiwan Corporation
(“MTTC”) (Note 3)
Development of software and services for
automotive and industrial control
NTC
Marketplace Management Limited (“MML”)
Investment holding
NTC
Nuvoton Technology Corporation America
(“NTCA”)
Design, sales and service of semiconductor
NTC
Nuvoton Investment Holding Ltd. (“NIH”)
Investment holding

% of Ownership

December 31

2022
2021
100.00
100.00
100.00
100.00
100.00
-
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
51.00
51.00
100.00
100.00
-
100.00
100.00
100.00
100.00
100.00
99.99
99.99
100.00
-
100.00
100.00
100.00
100.00
100.00
100.00

(Continued)

14 - - 90 -

Investor Investee Main Business NTC Nuvoton Electronics Technology (H.K.) Limited (“NTHK”) Sales of semiconductor NTC Song Yong Investment Corporation (“SYI”) Investment holding NTC Nuvoton Technology India Private Limited (“NTIPL”) Design, sales and service of semiconductor NTC Nuvoton Technology Singapore Pte. Ltd. (“NTSG”) Design, sales and service of semiconductor NTC Nuvoton Technology Korea Limited (“NTKL”) Design, sales and service of semiconductor NTC Nuvoton Technology Holdings Japan (“NTHJ”) Investment holding MML Goldbond LLC (“GLLC”) Investment holding GLLC Nuvoton Electronics Technology (Shanghai) Limited (“NTSH”) Provide projects for sale in China and repairing, testing, consulting of software and equipment leasing business GLLC Winbond Electronics (Nanjing) Ltd. (“WENJ”) Computer software service (except I.C. design) NTSH Song Zhi Electronics Technology (Suzhou) (“Song Zhi Suzhou”) Provide development of semiconductor and technology, consult service and equipment leasing business NIH Nuvoton Technology Israel Ltd. (“NTIL”) Design and service of semiconductor NTHK Nuvoton Electronics Technology (Shenzhen) Limited (“NTSZ”) Computer software service (except I.C. design), wholesale business for computer, supplement and software NTHJ Nuvoton Technology Corporation Japan (“NTCJ”) Design, sales and service of semiconductor NTCJ Atfields Manufacturing Technology Corporation (“AMTC”) Design and service of semiconductor	% of Ownership
	December 31
	2022 2021 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

Investor
Investee
Main Business
NTC
Nuvoton Electronics Technology (H.K.)
Limited (“NTHK”)
Sales of semiconductor
NTC
Song Yong Investment Corporation (“SYI”)
Investment holding
NTC
Nuvoton Technology India Private Limited
(“NTIPL”)
Design, sales and service of semiconductor
NTC
Nuvoton Technology Singapore Pte. Ltd.
(“NTSG”)
Design, sales and service of semiconductor
NTC
Nuvoton Technology Korea Limited (“NTKL”)
Design, sales and service of semiconductor
NTC
Nuvoton Technology Holdings Japan (“NTHJ”)
Investment holding
MML
Goldbond LLC (“GLLC”)
Investment holding
GLLC
Nuvoton Electronics Technology (Shanghai)
Limited (“NTSH”)
Provide projects for sale in China and
repairing, testing, consulting of software
and equipment leasing business
GLLC
Winbond Electronics (Nanjing) Ltd. (“WENJ”)
Computer software service (except I.C.
design)
NTSH
Song Zhi Electronics Technology (Suzhou)
(“Song Zhi Suzhou”)
Provide development of semiconductor and
technology, consult service and
equipment leasing business
NIH
Nuvoton Technology Israel Ltd. (“NTIL”)
Design and service of semiconductor
NTHK
Nuvoton Electronics Technology (Shenzhen)
Limited (“NTSZ”)
Computer software service (except I.C.
design), wholesale business for
computer, supplement and software
NTHJ
Nuvoton Technology Corporation Japan
(“NTCJ”)
Design, sales and service of semiconductor
NTCJ
Atfields Manufacturing Technology
Corporation (“AMTC”)
Design and service of semiconductor

% of Ownership

December 31

2022
2021
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00

(Concluded)

Note 1: The Company acquired 100% of ownership interest of WECJ from its subsidiary, Landmark, on November 30, 2022. The transaction was a reorganization under common control. Refer to Note 28 to the consolidated financial statements.
Note 2: The company acquired 100% of ownership interest of METC from its sub-subsidiary, NTCJ, on November 1, 2021. The transaction was a reorganization under common control. Refer to Note 28 to the consolidated financial statements.
Note 3: MTTC was established in November 2022.

Classification of Current and Non-current Assets and Liabilities

Current assets include cash and cash equivalents and those assets held primarily for trading purposes or to be realized, sold or consumed within twelve months after the reporting period, unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. Current liabilities are obligations incurred for trading purposes or to be settled within twelve months after the reporting period and liabilities that the Group does not have an unconditional right to defer settlement for at least twelve months after the reporting period. Except as otherwise mentioned, assets and liabilities that are not classified as current are classified as non-current.

Business Combinations Involving Reorganization under Common Control

The Group adopt the carrying amount method for business combinations involving reorganization under common control.

15 - - 91 -

Foreign Currencies

In preparing the financial statements of each individual group entity, transactions in currencies other than the entity’s foreign currencies are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Exchange differences on monetary items arising from settlement are recognized in profit or loss in the period they arise.

Exchange differences arising on the retranslation of non-monetary items measured at fair value are included in profit or loss for the period at the rates prevailing at the end of reporting period except for exchange differences arising from the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income, in which case, the exchange differences are also recognized directly in other comprehensive income.

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

For the purposes of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign operations are translated into New Taiwan dollars using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period, and exchange differences arising are recognized in other comprehensive income (attributed to the owners of the Company and non-controlling interests as appropriate).

Cash Equivalents

Cash equivalents include time deposits and investments, which are highly liquid, readily convertible to a known amount of cash and subject to an insignificant risk of changes in value. These cash equivalents are held for the purpose of meeting short-term cash commitments.

Financial Instruments

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

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

a. Financial assets measurement category

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis, except derivative financial assets which are recognized and derecognized on settlement date basis.

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

1) Financial asset at FVTPL

Financial assets are classified as at FVTPL when such financial assets are mandatorily classified or designated as at FVTPL. Financial assets mandatorily classified as at FVTPL include investments in equity instruments which are not designated as at FVTOCI and debt instruments that do not meet the amortized cost criteria or the FVOCI criteria.

16 - - 92 -

Financial assets at FVTPL are subsequently measured at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. The net gain or loss recognized in profit or loss does not incorporate any dividend or interest earned on the financial asset. Fair value is determined in the manner described in Note 30 to the consolidated financial statements.

2) Financial assets at amortized cost

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

a) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Subsequent to initial recognition, financial assets at amortized cost are measured at amortized cost, which equals to gross carrying amount determined by the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset, except for:

a) Purchased or originated credit-impaired financial assets, for which interest income is calculated by applying the credit-adjusted effective interest rate to the amortized cost of the financial asset; and
b) Financial assets that are not credit-impaired on purchase or origination but have subsequently become credit-impaired, for which interest income is calculated by applying the effective interest rate to the amortized cost of such financial assets in subsequent reporting periods.
3) Investments in equity instruments at FVTOCI

On initial recognition, the Group may make an irrevocable selection to designate investments in equity instruments as at FVOCI. Designation at FVOCI is not permitted if the equity investment is held for trading or if it is contingent consideration recognized by an acquirer in a business combination.

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

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

b. Impairment of financial assets

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

The Group always recognizes lifetime Expected Credit Loss (ECL) on accounts receivable. On all other financial instruments, the Group recognizes lifetime ECL when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on the financial instrument has not increased significantly since initial recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECL.

17 - - 93 -

Expected credit losses reflect the weighted average of credit losses with the respective risks of a default occurring as the weights. Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument. In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result from default events on a financial instrument that are possible within 12 months after the reporting date.

The Group recognizes an impairment loss in profit or loss for all financial instruments with a corresponding adjustment to their carrying amounts through a loss allowance account.

c. Derecognition of financial assets

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

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

d. Equity instruments

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

Equity instruments issued by the Group are recognized at the proceeds received, net of direct issue costs.

The repurchase of the Company’s own equity instruments is recognized in and deducted directly from equity, and its carrying amounts are calculated based on weighted average by share types and calculated separately by repurchase category. No gain or loss is recognized in profit or loss on the purchase, sale, issuance or cancellation of the Company’s own equity instruments.

e. Financial liabilities

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

Financial liabilities held for trading are stated at fair value, and any interest paid on such financial liabilities is recognized in finance costs; any remeasurement gains or losses on such financial liabilities are recognized in other gains or losses

Other financial liabilities are measured at amortized cost using the effective interest method.

f. Derecognition of financial liabilities

The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss.

18 - - 94 -
g. Derivative financial instruments

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

Derivatives are initially recognized at fair value at the date on which the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship. When the fair value of derivative financial instruments is positive, the derivative is recognized as a financial asset; when the fair value of derivative financial instruments is negative, the derivative is recognized as a financial liability.

Inventories

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

Investments in Associates

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

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

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

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

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

19 - - 95 -

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

The Group discontinues the use of the equity method from the date on which its investment ceases to be an associate. Any retained investment is measured at fair value at that date and the fair value is regarded as its fair value on initial recognition as a financial asset. The difference between the previous carrying amount of the associate attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate. The Group accounts for all amounts previously recognized in other comprehensive income in relation to that associate on the same basis as would be required if that associate had directly disposed of the related assets or liabilities.

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

Property, Plant and Equipment

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

Property, plant and equipment in the course of construction are measured at cost less any recognized impairment loss. Cost includes professional fees and borrowing costs eligible for capitalization. Before reaching its intended use, such assets are measured at the lower of cost or net realizable value, and any proceeds from selling those assets and the cost of those assets are recognized in profit or loss. Such assets are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for their intended use.

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

Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

The Group’s property, plant and equipment with residual values were depreciated straight-line basis over the estimated useful life of the asset:

the estimated useful life of the asset:
Buildings	8-50 years
Machinery and equipment	3-14 years
Other equipment	3-5 years

Investment Properties

Investment properties are properties held to earn rentals and/or for capital appreciation. Investment properties are measured initially at cost. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and accumulated impairment loss, and depreciated over 20 years useful lives after considered residual values, using the straight-line method. Any gain or loss arising on derecognition of the property is calculated as the difference between the net disposal proceeds and the carrying amount of the asset and is included in profit or loss in the period in which the property is derecognized.

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Intangible Assets

a. Intangible assets acquired separately

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

b. Derecognition of intangible assets

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

Impairment of Property, Plant and Equipment, Right-of-use Asset, Investment Properties, Intangible Assets

At the end of each reporting period, the Group reviews the carrying amounts of its property, plant and equipment, right-of-use asset, investment properties and intangible assets, to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss.

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

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

Non-current Assets Classified as Held for Sale

Non-current assets are classified as held for sale if their carrying amounts will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the non-current asset is available for immediate sale in its present condition. To meet the criteria for the sale being highly probable, the appropriate level of management must be committed to the sale, and the sale should be expected to qualify for recognition as a completed sale within 1 year from the date of classification.

Non-current assets classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell. Recognition of depreciation of those assets would cease.

Provisions

Provisions are recognized when the Group has a present obligation as a result of a past event and at the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation.

For potential product risk, the Group accrues reserve for products guarantee based on commitment to specific customers.

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Revenue Recognition

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

Revenue from sale of goods is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates and other similar allowances. Provision for estimated sales returns and other allowances is generally made and adjusted based on historical experience and on the consideration of varying contractual terms affecting the recognition of a provision, which is classified under other non-current liabilities.

Leasing

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

a. The Group as lessor

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

When the Group subleases a right-of-use asset, the sublease is classified by reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset. However, if the head lease is a short-term lease that the Group, as a lessee, has accounted for applying recognition exemption, the sublease is classified as an operating lease.

Under financing leases, the lease payments comprise fixed payments, in-substance fixed payments, variable lease payments which depend on an index or a rate, residual value guarantees, the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and payments of penalties for terminating a lease if the lease term reflects such termination, less any lease incentives payable. The net investment in a lease is measured at (a) the present value of the sum of the lease payments receivable by a lessor and any unguaranteed residual value accrued to the lessor plus (b) initial direct costs and is presented as a finance lease receivable. Finance lease income is allocated to the relevant accounting periods so as to reflect a constant, periodic rate of return on the Group’s net investment outstanding in respect of leases.

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

b. The Group as lessee

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

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

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

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Lease liabilities are initially measured at the present value of the lease payments, which comprise fixed payments, in-substance fixed payments, variable lease payments which depend on an index or a rate, residual value guarantees, the exercise price of a purchase option if the Group is reasonably certain to exercise that option, and payments of penalties for terminating a lease if the lease term reflects such termination, less any lease incentives receivable. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the Group uses the lessee’s incremental borrowing rate.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in a lease term, a change in the amounts expected to be payable under a residual value guarantee, a change in the assessment of an option to purchase an underlying asset, or a change in future lease payments resulting from a change in an index or a rate used to determine those payments, the Group remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. For a lease modification that is not accounted for as a separate lease, the Group accounts for the remeasurement of the lease liability by (a) decreasing the carrying amount of the right-of-use asset of lease modifications that decreased the scope of the lease, and recognizing in profit or loss any gain or loss on the partial or full termination of the lease; (b) making a corresponding adjustment to the right-of-use asset of all other lease modifications. Lease liabilities are presented on a separate line in the consolidated balance sheets.

The Group negotiates with the lessor for rent concessions as a direct consequence of the Covid-19 to change the lease payments originally due by June 30, 2022, and there is no substantive change to other terms and conditions. The Group elects to apply the practical expedient to all of these rent concessions and, therefore, does not assess whether the rent concessions are lease modifications. Instead, the Group recognizes the reduction in lease payment in profit or loss, in the period in which the events or conditions that trigger the concession occur, and makes a corresponding adjustment to the lease liability.

Variable lease payments that do not depend on an index or a rate are recognized as expenses in the periods in which they are incurred.

Borrowing Costs

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

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

Government Grants

Government grants are not recognized until there is reasonable assurance that the Group will comply with the conditions attached to them and that the grants will be received.

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

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

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Government grants that take the form of a transfer of a non-monetary asset for the use of the entity are recognized and measured at the fair value of the non-monetary asset.

The benefit of a government loan received at a below-market rate of interest is treated as a government grant measured as the difference between the proceeds received and the fair value of the loan based on prevailing market interest rates.

Employee Benefits

a. Short-term employee benefits

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

b. Retirement benefits

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

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

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

Taxation

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

a. Current tax

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

According to the Income Tax Law in the ROC, an additional tax on unappropriated earnings is provided for in the year the shareholders approve to retain earnings. Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

b. Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities and the corresponding tax bases used in the computation of taxable profit and it is remeasured at the end of each reporting period and recognized to the extent that it has become probable that there will be future taxable profit.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

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

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

The Group considers the possible impact of the recent development of the COVID-19 in the world and its economic environment implications when making its critical accounting estimates in cash flow projections, growth rate, discount rate, profitability, etc. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimates are revised if the revisions affect only that year or in the year of the revisions and future years if the revisions affect both current and future years.

The Group’s critical accounting judgments and key sources of estimation uncertainty is valuation of inventory. Net realizable value of inventory is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. The estimation of net realizable value is based on current market conditions and the historical experience from selling products of a similar nature. Changes in market conditions may have a material impact on the estimation of net realizable value.

6. CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS
Cash and deposits in banks Repurchase agreements collateralized by bonds		December 31
		2022 $ 18,642,936 1,760,000 $ 20,402,936	2021 $ 27,374,370 3,540,057 $ 30,914,427

a. The Group has time deposits pledged to secure land and building leases and customs tariff obligations which are reclassified to “other non-current assets”. The amounts were as follows:

Time deposits		December 31	December 31
		2022 $ 236,938	2021 $ 234,269

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b. The Group has partial time deposits which were not held for the purpose of meeting short-term cash commitments and are reclassified to “other receivables”. These partial time deposits at the end of the reporting period were as follows (refer to Note 11 to the consolidated financial statements):

Time deposits		December 31	December 31
		2022 $ 56,214	2021 $ 184,481

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

Financial assets at FVTPL-current Derivative financial assets Forward exchange contracts Non-derivative financial assets Domestic listed and emerging stocks Overseas unlisted stocks Mutual funds Financial assets at FVTPL-non-current Mandatorily measured at FVTPL Foreign currency warrants Financial liabilities at FVTPL-current Derivative financial liabilities Forward exchange contracts		December 31	December 31
		2022 $ 7,173 44,433 61,420 110,506 $ 223,532 $ 121,775 $ 7,412	2021 $ 51,688 - 55,360 108,700 $ 215,748 $ 69,200 $ -

a. At the date of balance sheet, the outstanding derivative foreign exchange contracts not under hedge accounting were as follows:

accounting were as follows:
			Contract Amount
	Currencies	Maturity Date	(In Thousands)
December 31, 2022
Sell forward exchange contracts	USD to NTD	2023.01.06-2023.03.17	USD244,500/NTD7,492,601
Sell forward exchange contracts	USD to JPY	2023.01.23-2023.02.21	USD17,400/JPY2,300,582
Buy forward exchange contracts	NTD to USD	2023.01.13-2023.02.17	NTD1,552,375/USD50,500
December 31, 2021
Sell forward exchange contracts	USD to NTD	2022.01.06-2022.03.04	USD286,000/NTD7,949,136
Sell forward exchange contracts	RMB to NTD	2022.01.14-2022.01.21	RMB75,000/NTD325,655
Buy forward exchange contracts	NTD to USD	2022.02.17-2022.02.25	NTD965,550/USD35,000

b. The Group entered into derivative financial instruments contracts to manage exposures to exchange rate fluctuations of foreign currency denominated assets and liabilities. The derivative financial instruments contracts entered into by the Group did not meet the criteria of hedge accounting; therefore, the Group did not apply hedge accounting treatment.
26 -
102 -

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Equity instruments at FVTOCI:

Equity instruments at FVTOCI:
Domestic listed and emerging stocks Domestic unlisted stocks Overseas unlisted stocks Mutual funds Current Non-current		December 31
		2022 $ 14,705,736 1,081,708 625,340 1,231,877 $ 17,644,661 $ 14,587,832 3,056,829 $ 17,644,661	2021 $ 11,235,587 638,326 1,820,415 765,011 $ 14,459,339 $ 10,977,904 3,481,435 $ 14,459,339

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

For the years ended December 31, 2022 and 2021, the Group disposed partial shares for the investment position adjustment. The unrealized gain and loss on financial assets at fair value through other comprehensive income of NT$300,524 thousand and NT$94,258 thousand were transferred to retained earnings, respectively, please refer to Note 22 to consolidated financial statements for related information.

9. ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE
Accounts receivable At amortized cost Gross carrying amount Less: Allowance for impairment loss		December 31
		2022 $ 9,283,776 (146,030) $ 9,137,746	2021 $ 11,819,385 (303,792) $ 11,515,593

The average credit period of sales of goods was 30 to 60 days. No interest was charged on accounts receivable. The Group adopted a policy of only dealing with entities that are rated the equivalent of investment grade or higher and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. Credit rating information is supplied by independent rating agencies where available and, if not available, the Group uses other publicly available financial information and its own trading records to rate its major customers. The Group’s exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties. Credit exposure is controlled by counterparty limits that are reviewed and approved annually.

27 - - 103 -

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

The Group applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits the use of lifetime expected loss provision for all accounts receivable. The expected credit losses on accounts receivable are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor’s current financial position, adjusted for general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of conditions at the reporting date. The Group estimates expected credit losses based on past due days. As the Group’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished between the Group’s different customer base.

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

The following table details the loss allowance of accounts receivable based on the overdue aging ratio and individual customer evaluation method.

December 31, 2022

Expected credit loss rate Gross carrying amount Loss allowance (lifetime ECL) Amortized cost December 31, 2021 Expected credit loss rate Gross carrying amount Loss allowance (lifetime ECL) Amortized cost	Not Overdue 0.1-2% $ 9,038,364 (138,396) $ 8,899,968 Not Overdue 0.1-2% $ 11,396,793 (187,741) $ 11,209,052	Overdue under 30 Days 2% $ 226,155 (4,523) $ 221,632 Overdue under 30 Days 2% $ 303,344 (6,067) $ 297,277	Overdue 31-90 Days 10% $ 7,407 (741) $ 6,666 Overdue 31-90 Days 10% $ 10,282 (1,028) $ 9,254	Overdue 91-180 Days Overdue Over 180 Days 20% 50% $ 11,850 $ - (2,370) - $ 9,480 $ - Overdue 91-180 Days Overdue Over 180 Days 20% 50-100% $ 13 $ 108,953 (3) (108,953) $ 10 $ -	Total $ 9,283,776 (146,030)
					$ 9,137,746
					Total $ 11,819,385 (303,792)
					$ 11,515,593

The movements of loss allowance of accounts receivable were as follows:

Balance at January 1 Recognized (reversal of) impairment loss Effect of exchange rate changes Balance at December 31	2022 $ 303,792 (151,262) (6,500) $ 146,030	2021 $ 266,759 56,210 (19,177) $ 303,792

Refer to Note 30 to the consolidated financial statements for details of NTC’s factoring agreements for accounts receivable.

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10. FINANCE LEASE RECEIVABLES

FINANCE LEASE RECEIVABLES
Undiscounted lease payments Year 1 Year 2 Year 3 Less: Unearned finance income Finance lease receivables Current Non-current		December 31
		2022 $ 100,135 100,135 25,034 225,304 (5,122) $ 220,182 $ 96,731 123,451 $ 220,182	2021 $ - - - - - $ - $ - - $ -

NTC leased out its property, plant and equipment and intangible assets to its associate, TPSCo., under finance leases with an average lease term for 3 years. In 2022, the average implied interest rate is approximately 1.85% per year. Refer to Note 31 to the consolidated financial statements for details of finance lease contracts.

11. OTHER RECEIVABLES

OTHER RECEIVABLES
Business tax refund receivable Time deposits (Note 6) Income tax refund receivable (Note 25) Royalty receivable Technical service receivable Others		December 31
		2022 $ 229,680 56,214 38,037 - - 234,905 $ 558,836	2021 $ 291,030 184,481 77,826 370,327 136,345 207,017 $ 1,267,026

12. INVENTORIES

INVENTORIES
Finished goods Work-in-process Raw materials and supplies Inventories in transit		December 31
		2022 $ 3,095,173 16,393,699 1,958,690 516 $ 21,448,078	2021 $ 2,034,079 11,238,945 2,652,854 14,810 $ 15,940,688

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The detail of the operating costs related to inventories was as follows:

The operating cost of goods sold Recognition of inventory write-downs (reversed) and scrap of inventories, etc. Unallocated production overhead Operating costs	2022 $ 48,535,925 650,800 2,291,982 $ 51,478,707	2021 $ 57,181,372 (635,590) 543,075 $ 57,088,857

13. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

Investments in Associates

Investments in Associates
Associates that are not individually material Chin Xin Investment Co., Ltd. Tower Partners Semiconductor Co., LTD. (“TPSCo.”) Hwa Bao Botanic Conservation Corp.		December 31
		2022 $ 7,996,268 1,710,869 264,303 $ 9,971,440	2021 $ 8,257,867 - 28,596 $ 8,286,463

On May 27, 2022, the board of directors of Hwa Bao Botanic Conservation Corp. (“Hwa Bao”) resolved to issue 60,000 thousand ordinary shares. In addition to subscribing in the proportion of share ownership, the Company is also a specified subscriber. The Company subscribed for 21,000 thousand ordinary shares in total with a par value of NT$10. As of December 31, 2022, the Company held 24,000 thousand shares of Hwa Bao, which equals to 30% ownership interest, and Hwa Bao was accounted for using the equity method.

As of December 31, 2022, the Company held 182,841 thousand shares of Chin Xin Investment Co., Ltd. with a 38% ownership interest.

Under the business acquisition agreement, if TPSCo. turns a net profit during the period of the effective date of the acquisition (September 1, 2020) to March 31, 2022, NTC is required to pay Panasonic Corporation the net profit based on its ownership proportion. Thus, NTC has no significant influence over TPSCo. during the period aforementioned. TPSCo. was recognized as non-current financial assets at fair value through other comprehensive income. Starting from April 2022, the restriction has been waived for NTC, and NTC has significant influence over TPSCo.; accordingly, TPSCo. has been accounted for using the equity method. NTCJ subscribed for 30,919 shares issued in the cash capital increase by TPSCo. in a total amount of NT$358,772. As of December 31, 2022, NTCJ has held TPSCo.’s 45,619 shares with a direct shareholding of 49%.

In June 2022, NTCJ transferred the right-of-use assets contract to TPSCo. The related deferred benefit will be recognized in accordance with the remaining lease term of the contract, refer to Note 31 to the consolidated financial statements.

The Group’s investments accounted for using equity method and the shares of profit or loss and other comprehensive income of those investments for the years ended December 31, 2022 and 2021 were based on the associates’ financial statements audited by independent auditors.

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14. PROPERTY, PLANT AND EQUIPMENT

Land Buildings Machinery and equipment Other equipment Construction in progress and equipment Land Cost Balance at January 1, 2022 $ 3,069,658 Additions 61,407 Disposals - Reclassified 12,248 Effect of exchange rate changes (56,666) Balance at December 31, 2022 $ 3,086,647 Accumulated depreciation and impairment Balance at January 1, 2022 $ - Depreciation expense - Disposals - Impairment loss - Reclassified - Effect of exchange rate changes - Balance at December 31, 2022 $ - Cost Balance at January 1, 2021 $ 3,322,387 Additions 34,760 Business combinations - subsequent adjustment of fair values - Disposals - Reclassified - Effect of exchange rate changes (287,489) Balance at December 31, 2021 $ 3,069,658 Accumulated depreciation and impairment Balance at January 1, 2021 $ - Depreciation expense - Disposals - Impairment loss - Reclassified - Effect of exchange rate changes - Balance at December 31, 2021 $ -	under installation Buildings Machinery and Equipment O $ 47,939,867 $ 177,909,476 162,805 9,245,321 (23,611) (2,177,698) 181,258 (5,818,573) (548,438) (1,468,558) $ 47,711,881 $ 177,689,968 $ 36,156,742 $ 149,511,902 1,774,774 6,528,059 (22,100) (2,167,485) - 112,266 - (3) (496,736) (1,469,517) $ 37,412,680 $ 152,515,222 $ 50,113,861 $ 182,256,279 284,825 3,980,466 - 437,628 (13,698) (2,351,827) 119,784 217,133 (2,564,905) (6,630,203) $ 47,939,867 $ 177,909,476 $ 36,773,934 $ 148,018,047 1,687,364 8,797,435 (13,650) (1,585,530) - 782,949 79 31,168 (2,290,985) (6,532,167) $ 36,156,742 $ 149,511,902	the $		December 31
			2022 2021 $ 3,086,647 $ 3,069,658 10,299,201 11,783,125 25,174,746 28,397,574 1,559,960 1,030,036 53,686,085 16,799,212 $ 93,806,639 $ 61,079,605 r Equipment Construction in Progress and Equipment under Installation Total 7,586,418 $ 16,799,212 $ 253,304,631 799,415 31,497,094 41,766,042 (173,299) - (2,374,608) 232,207 5,392,860 - (90,087) (3,081) (2,166,830) 8,354,654 $ 53,686,085 $ 290,529,235 6,556,382 $ - $ 192,225,026 425,455 - 8,728,288 (99,962) - (2,289,547) - - 112,266 3 - - (87,184) - (2,053,437) 6,794,694 $ - $ 196,722,596 7,750,795 $ 9,639,168 $ 253,082,490 506,331 7,530,487 12,336,869 - - 437,628 (231,965) - (2,597,490) 13,950 (350,867) - (452,693) (19,576) (9,954,866) 7,586,418 $ 16,799,212 $ 253,304,631 6,803,522 $ 34,471 $ 191,629,974 389,589 - 10,874,388 (212,998) - (1,812,178) - - 782,949 428 (31,675) - (424,159) (2,796) (9,250,107) 6,556,382 $ - $ 192,225,026
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		$
		$

a. As of December 31, 2022 and 2021, the carrying amounts of NT$52,365,644 thousand and NT$11,352,868 thousand of property, plant and equipment were pledged to secure long-term borrowings and corporate bonds.

31 - - 107 -
b. Information about capitalized interest

Information about capitalized interest
Capitalized interest amounts Capitalized interest rates	For the Year Ended December 31
	2022 2021 $ 528,129 $ 252,668 1.89%-1.92% 1.79%-1.89%

c. In 2022, NTC disposed of other equipment for finance lease amounted to NT$72,533 thousand. Refer to Note 31 to the consolidated financial statements for details of finance lease contracts.
d. For the years ended December 31, 2022 and 2021, the Group recognized an impairment loss of NT$112,266 thousand and NT$782,949 thousand for certain machinery and equipment which will not be used in the future after evaluation, respectively.

15. LEASE ARRANGEMENTS

a. Right-of-use assets

Right-of-use assets
Carrying amounts Land Buildings Machinery and equipment Other equipment		December 31
		2022 $ 1,667,604 383,165 139,758 33,954 $ 2,224,481	2021 $ 1,717,843 289,439 754,180 35,458 $ 2,796,920

In June 2022, NTC transferred its lease arrangement of machinery under right-of-use assets to TPSCo. The gain on lease modification amounted to NT$178,623 thousand. Refer to Note 31 to the consolidated financial statements.

Additions to right-of-use assets Depreciation charge for right-of-use assets Land Buildings Machinery and equipment Other equipment Income from the subleasing of right-of-use assets (recorded as “other income”)	For the Year Ended	For the Year Ended	December 31
		2022 $ 369,518 $ 110,896 153,474 32,999 28,925 $ 326,294 $ 1,999	2021 $ 55,596 $ 107,378 122,394 68,557 32,167 $ 330,496 $ 2,080

32 - - 108 -

b. Lease liabilities

Lease liabilities
Carrying amounts Current Non-current		December 31
		2022 $ 276,015 $ 2,052,762	2021 $ 333,791 $ 2,682,609

Range of discount rate for lease liabilities are as follows:

Land Buildings Machinery and equipment Other equipment	December 31
	2022 2021 1.76%-2.47% 1.76%-2.47% 0.14%-3.55% 0.33%-3.75% 0.48%-0.80% 0.26%-0.80% 0.14%-2.44% 0.44%-2.97%

For the years ended December 31, 2022 and 2021, the interest expense under lease liabilities amounted to NT$51,349 thousand and NT$57,188 thousand, respectively.

c. Material lease-in activities and terms

The Company and NTC leased lands from Science Park Bureau, and the lease term will expire in 2023, 2027 and 2037, respectively, which can be extended after the expiration of the lease periods.

NTC leased a land from Taiwan Sugar Corporation under a twenty-year term from October 2014 to September 2034, which can be extended after expiration of the lease periods. The chairman of NTC is a joint guarantor of such lease, refer to Note 31 to the consolidated financial statements.

The Group leased office spaces in the United States, China, Hong Kong, Japan, Israel, India, Korea, Germany and part in Taiwan, and the lease terms will expire between 2023 and 2026 which can be extended after the expiration of the lease contract periods.

d. Subleases

In addition to those disclosed in Notes 10 and 16 to the consolidated financial statements, NTC also subleases its right-of-use assets for buildings under operating leases. The maturity analysis of lease payments receivable under operating subleases is as follows:

Year 1 Year 2		December	31
		2022 $ 1,988 1,326 $ 3,314	2021 $ 2,080 2,080 $ 4,160

To reduce the residual asset risk related to the subleased asset at the end of the relevant sublease, the lease contract between NTC and the lessee includes the receipt of the deposits and the compensation for damage due to the lack of management and maintenance.

33 - - 109 -

e. Other lease information

Other lease information
Expenses relating to short-term leases Expenses relating to low-value asset leases Expenses relating to variable lease payments not included in the measurement of lease liabilities Total cash outflow for leases	For the Year Ended		December 31
		2022 $ 191,498 $ 1,941 $ 11,660 $ 597,501	2021 $ 241,852 $ 677 $ 17,567 $ 699,413

The Group leases certain building, machinery and equipment, transportation equipment qualify as short-term leases and certain other equipment qualify as low-value lease. The Group has selected to apply the recognition exemption and thus, did not recognize right-of-use assets and lease liabilities for these leases.

Lease-out arrangements under operating leases for investment properties are set out in Note 16 to the consolidated financial statements.

16. INVESTMENT PROPERTIES

INVESTMENT PROPERTIES
Investment properties, net		December 31
		2022 $ 1,798,160	2021 $ 2,005,598

NTC acquired investment properties in Niigata and Toyama, Japan through business combinations on September 1, 2020. The fair value of such investment properties were NT$2,503,591 thousand based on the purchase price allocation report. In 2022 and 2021, NTC’s management evaluated the fair value of investment properties and determined that the fair value of the investment properties had not changed significantly.

NTC’s other investment properties is in Shen-Zhen, China. As of December 31, 2022 and 2021, the fair value of such investment properties were both approximately NT$200,000 thousand, which was referred by the neighborhood transactions.

Cost Balance at January 1 Disposals Effect of exchange rate changes Balance at December 31 Accumulated depreciation and impairment Balance at January 1 Depreciation expense Disposals Effect of exchange rate changes Balance at December 31 Investment properties, net		December 31	December 31
		2022 $ 7,924,196 - (262,074) 7,662,122 5,918,598 138,763 - (193,399) 5,863,962 $ 1,798,160	2021 $ 9,090,968 (1,176) (1,165,596) 7,924,196 6,624,301 155,190 (1,176) (859,717) 5,918,598 $ 2,005,598

34 - - 110 -

The investment properties were leased out for 3 to 12 years. The lease contracts contain market review clauses in the event that the lessees exercise their options to extend. The lessees do not have bargain purchase options to acquire the investment properties at the expiry of the lease periods.

The maturity analysis of NTC’s lease payments receivable under operating leases of investment properties is as follows:

Year 1 Year 2 Year 3 Year 4 Year 5 More than five years		December 31	December 31
		2022 $ 171,129 152,691 149,898 149,898 149,898 637,067 $ 1,410,581	2021 $ 178,142 155,123 155,123 155,123 155,123 814,391 $ 1,613,025

As of December 31, 2022 and 2021, the carrying amounts of NT$381,219 thousand and NT$425,606 thousand of investment properties of NTC were pledged to secure long-term borrowings, respectively.

17. INTANGIBLE ASSETS

INTANGIBLE ASSETS
Deferred technical assets, net Other intangible assets, net Carbon credits Cost Balance at January 1, 2022 Additions Disposals Carbon offset Reclassified Effect of exchange rate changes Balance at December 31, 2022	Deferred Technical Assets $ 19,801,638 170,807 - - - 4,936 $ 19,977,381	Other Intangible Assets $ 1,495,795 91,340 (206,865) - (763) (51,906) $ 1,327,601	December 31
			2022 $ 558,739 223,101 763 $ 782,603 Carbon Credits $ - 937 - (174) - - $ 763	2021 $ 616,861 456,124 - $ 1,072,985 Total $ 21,297,433 263,084 (206,865) (174) (763) (46,970) $ 21,305,745

(Continued)

35 - - 111 -

Accumulated amortization and impairment Balance at January 1, 2022 Amortization expenses Disposals Effect of exchange rate changes Balance at December 31, 2022 Cost Balance at January 1, 2021 Additions Disposals Effect of exchange rate changes Balance at December 31, 2021 Accumulated amortization and impairment Balance at January 1, 2021 Amortization expenses Disposals Effect of exchange rate changes Balance at December 31, 2021	Deferred Technical Assets $ 19,184,777 228,037 - 5,828 $ 19,418,642 $ 19,550,666 259,590 (5,592) (3,026) $ 19,801,638 $ 18,988,797 198,298 (789) (1,529) $ 19,184,777	Other Intangible Assets $ 1,039,671 99,066 (1,743) (32,494) $ 1,104,500 $ 1,452,139 216,296 (111) (172,529) $ 1,495,795 $ 1,122,628 61,481 (111) (144,327) $ 1,039,671	Carbon Credits $ - - - - $ - $ - - - - $ - $ - - - - $ -	Total $ 20,224,448 327,103 (1,743) (26,666) $ 20,523,142 $ 21,002,805 475,886 (5,703) (175,555) $ 21,297,433 $ 20,111,425 259,779 (900) (145,856) $ 20,224,448 (Concluded)

The amounts of deferred technical assets were the technical transfer fees in connection with certain technical transfer agreements. The above technical assets pertained to different products or process technology. The assets were depreciated on a straight-line basis from the commencement of production or over the estimated useful lives of the assets. The estimated useful lives of technical assets were based on the economic benefits generated from the assets or the terms of the technical asset contracts.

The Company's carbon credits were purchased from the CIX platform in Singapore, which was certified by third-party regarding forest carbon rights. The carbon credits will be used to offset carbon emission from fabs and employee transportation, etc. On November 3, 2022, the Company acquired the certificate which containing 1,000 tonnes of carbon credits from the platform, and offset 194 tonnes of carbon emissions on the Company’s Family Day.

In 2022, NTC disposed of intangible assets for finance leases amounted to NT$204,857 thousand. Refer to Note 31 to the consolidated financial statements for details of finance lease contracts.

36 - - 112 -

18. BORROWINGS

a. Short-term borrowings

Short-term borrowings
Secured borrowings Bank loans Unsecured borrowings Bank lines of credit	December 31
	2022 Interest Rate % Amount 1.15% $ 952,840 1.02% 116,200 $ 1,069,040	2021
	Interest Rate % 1.15% 1.02%	Interest Rate % - 0.30%-0.48%	Amount $ - 1,430,417 $ 1,430,417

On May 17, 2021, NTCJ signed a syndicated loan with CTBC and a group of financial institutions to pay outstanding debt and enrich operating capital, and the line of credit amounted to JPY30 billion. This syndicated loan requires the Company to act as a joint guarantor and hold ownership of NTCJ with NTC by no less than 100% with maintenance operational control as stated in the agreement. According to the financial covenants, NTCJ and the Company are required to maintain their financial ratios not lower than a specific threshold over the effective period, and there is no breach of the terms of the contract. The financial ratios mentioned above are computed based on the audited (reviewed) consolidated financial statements.

b. Long-term borrowings

Long-term borrowings
Period Interest Rate Secured borrowings Bank of Taiwan syndicated loan (V) 2019.01.14-2026.09.19 2.43% Unsecured borrowings The Export - Import Bank of ROC 2019.09.20-2026.09.21 0.92%-1.34% The Export - Import Bank of ROC 2020.08.25-2027.08.25 0.92%-1.34% Government grants (Note 27) 2020.12.28-2028.11.15 1.13%-1.33% Less: Current portion Less: Syndication agreement management fee Less: Government loan discount (Note 27)		December 31
		2022 $ 31,000,000 500,000 1,000,000 5,131,600 37,631,600 (3,171,429) (47,250) (134,848) $ 34,278,073	2021 $ 7,850,000 500,000 1,000,000 5,131,600 14,481,600 (785,000) (74,250) (273,485) $ 13,348,865

1) Bank of Taiwan Syndicated Loan (V)

a) On January 14, 2019, the Company entered into a syndicated loan, with a group of financial institutions, to procure equipment for fab. The credit line amounted to NT$42 billion. The principal will be repaid every six months from September 19, 2023 until maturity.
b) Refer to Note 14 to the consolidated financial statements for collateral on bank borrowings.
37 - - 113 -
c) The Company is required to maintain certain financial covenants, including current ratio, debt ratio and total equity, on June 30 and December 31 during the tenors of the loans. Additionally, the principal and interest coverage should be also maintained on June 30 and December 31 during the tenors of the loans. The Company was in compliance with the agreed financial ratio requirements. The computations of financial ratios mentioned above are done based on the audited (reviewed) consolidated financial statements.
2) The proceeds of the unsecured borrowings from the Export-Import Bank of ROC were provided NTC for investing in Autotalks Ltd. and acquiring Panasonic Semiconductor Solutions., Co., Ltd.

The loan is secured by property, plant and equipment of NTC, please refer to Note 14 to the consolidated financial statements.

19. BONDS PAYABLE

BONDS PAYABLE
Domestic secured bonds Domestic unsecured bonds		December 31
		2022 $ 9,968,462 - $ 9,968,462	2021 $ 9,956,086 - $ 9,956,086

a. On July 10, 2018, the Company was approved by the FSC to offer and issue the first secured corporate bonds of 2018, with an aggregate principal amount of NT$10 billion. The terms of issuance, amounts and interest rate as follows:

Issuance			Coupon
Date	Period	Amount	Rate	Repayment and Interest Payment
2018.07.17	7 years	$10 billion	1%	The principal will be repaid upon maturity. The
				interest is payable once a year at the coupon
				rate accrued annually on a simple basis starting
				from the issue date.

Refer to Note 14 to the consolidated financial statements for collateral of 12-inch Fab Manufacturing facilities on corporate bonds.

b. In May 2020, NTC issued 20 thousand units, NT$100 thousand per unit, 0% NTD-denominated unsecured convertible bonds in Taiwan, with an aggregate principal amount of NT$2 billion. The terms of issuance, amounts and interest rate as follows:

Issuance Coupon Date Period Amount Rate Repayment and Interest Payment 2020.05.20 7 years $2 billion 0% The principal will be repaid in cash upon maturity at a rate of 109.09% (annual rate of return 1.25% upon maturity).

1) The conversion price was set at NT$39.9 per share at the time of issuance. When meeting certain criteria, adjustments on the conversion price are made in accordance with the terms and conditions. Since NTC distributed cash dividends in August 2021, the conversion price should be adjusted according to the issuance and conversion measures, so the conversion price has been adjusted to NT$38 since August 22, 2021. As of December 31, 2021, all convertible bonds were converted into ordinary shares.
38 - - 114 -
2) After the first three months of the issuance and forty days before the maturity date, if the closing price of NTC’s common shares listed on the Taiwan Stock Exchange exceeds or equals 30% of the conversion price or the outstanding balance of the bonds is less than 10% in principal amount of the bonds originally outstanding for thirty consecutive business days, NTC may redeem the bonds in cash at the principal amount.
3) After the bonds has been issued for over five years, the bondholders may request NTC to redeem the bonds at 106.41% of the principal amount (annual rate of return 1.25%).
4) Except for the NTC’s bonds that have been redeemed, sold back, converted, or bought back by NTC in the market, the principal will be repaid in cash upon maturity at a rate of 109.09% (annual rate of return 1.25% upon maturity).

20. PROVISIONS

PROVISIONS
Current Decommissioning liabilities Non-current Employee benefits Warranties Decommissioning liabilities Decommissioning Liabilities Balance at January 1, 2022 $ 1,186,627 Decreased (475,526) Effects of foreign currency exchange differences (67,813) Balance at December 31, 2022 $ 643,288	Employee Benefits $ 1,537,035 - (51,767) $ 1,485,268		December 31
		$	2022 132,473 1,485,268 737,268 510,815 2,733,351 Warranties $ 775,861 (28,120) (10,473) $ 737,268	$	2021 532,948 1,537,035 775,861 653,679 2,966,575 Total $ 3,499,523 (503,646) (130,053) $ 2,865,824
		$		$
		$		$

NTC purchased the semiconductor business of Panasonic Corporation in September 2020. The expected decommissioning costs and personnel costs from shutting down some fabs were recognized as the decommissioning liabilities and employee benefits provisions.

21. RETIREMENT BENEFIT PLANS

a. Defined contribution plan

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

The employees of the Group’s subsidiaries in the United States, Japan, Hong Kong, Germany, Israel, Korea, Singapore and China are required to contribute a specified percentage of payroll costs to the retirement benefit scheme to fund the benefits. The only obligation of the Group with respect to the retirement benefit plan is to make the specified contributions.

39 - - 115 -

b. Defined benefit plan

The defined benefit plans adopted by the Company and NTC in accordance with the Labor Standards Law is operated by the government of the ROC. Pension benefits are calculated on the basis of the length of service and average of monthly salaries of the 6 months before retirement. The Company contributes amounts equal to 2% of total monthly salaries and wages; NTC contributes amounts equal to 2% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee of the Company. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the Company assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Company is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (“the Bureau”); the Company has no right to influence the investment policy and strategy.

The payables for employee turnover of WTL and NTIL are calculated on the basis of the length of service and the last month’s salary under a defined benefit plan.

The amount included in the consolidated balance sheet in respect of the Group’s obligation to its defined benefit plan was as follows:

December 31 2022 2021 Present value of the defined benefit obligation $ 4,306,648 $ 4,500,536 Fair value of the plan assets (2,414,054) (1,879,521) Net defined benefit liabilities, non-current $ 1,892,594 $ 2,621,015 Movements in net defined benefit liabilities (assets) were as follows: Present Value of the Defined Benefit Obligation Fair Value of the Plan Assets Net Defined Benefit Liabilities (Assets) Balance at January 1, 2022 $ 4,500,536 $ (1,879,521) $ 2,621,015 Service cost Current service cost 93,035 - 93,035 Net interest expense (income) 40,834 (26,586) 14,248 Others (3,204) 602 (2,602) Recognized in profit or loss 130,665 (25,984) 104,681 Remeasurement Actuarial (gain) loss - realized rate greater than the discounted rate - (54,752) (54,752) - changes in demographic assumptions (28,724) - (28,724) - changes in financial assumptions (328,218) 21,261 (306,957) - experience adjustments 169,198 5,419 174,617 Recognized in other comprehensive income (187,744) (28,072) (215,816) Contributions from the employer - (572,037) (572,037) Benefits paid (80,740) 79,423 (1,317) Effect of exchange rate changes (56,069) 12,137 (43,932) Balance at December 31, 2022 $ 4,306,648 $ (2,414,054) $ 1,892,594		December 31	December 31
			2021 $ 4,500,536 (1,879,521) $ 2,621,015 Net Defined Benefit Liabilities (Assets) $ 2,621,015 93,035 14,248 (2,602) 104,681 (54,752) (28,724) (306,957) 174,617 (215,816) (572,037) (1,317) (43,932) $ 1,892,594

(Continued)

40 - - 116 -

Present Value
of the Defined
Benefit
Obligation
Fair Value of
the Plan Assets
Balance at January 1, 2021
$ 4,578,390
$ (1,855,846)
Service cost
Current service cost
81,614
-
Net interest expense (income)
24,851
(15,026)
Others
4,069
(777)
Recognized in profit or loss
110,534
(15,803)
Remeasurement
Actuarial (gain) loss
- realized rate greater than the
discounted rate
-
(18,019)
- changes in demographic assumptions
58,672
-
- changes in financial assumptions
(426)
(9,264)
- experience adjustments
111,751
(26,150)
Recognized in other comprehensive income
169,997
(53,433)
Contributions from the employer
-
(94,450)
Benefits paid
(142,879)
141,969
Settlements
(28,909)
-
Effect of exchange rate changes
(186,597)
(1,958)
Balance at December 31, 2021
$ 4,500,536
$ (1,879,521)

Net Defined
Benefit
Liabilities
(Assets)
$ 2,722,544
81,614
9,825
3,292
94,731
(18,019)
58,672
(9,690)
85,601
116,564
(94,450)
(910)
(28,909)
(188,555)
$ 2,621,015
(Concluded)

Amounts recognized in profit or loss in respect of these defined benefit plans analyzed by function were as follows:

as follows:
Operating costs Selling expenses General and administrative expenses Research and development expenses	For the Year Ended		December 31
		2022 $ 16,830 2,028 21,134 64,689 $ 104,681	2021 $ 17,522 2,003 6,007 69,199 $ 94,731

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

1) Investment risk: The plan assets are invested in domestic/and foreign/equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.
2) Interest risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.
3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.
41 - - 117 -

The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The principal assumptions used for the purposes of the actuarial valuations were as follows:

follows:
Discount rates Expected rates of salary increase	December 31
	2022 2021 1.25%-5.26% 0.70%-2.80% 1.00%-6.25% 1.00%-6.02%

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

Discount rates 0.25%-0.50% increase 0.25%-0.50% decrease Expected rates of salary increase/decrease 0.25%-0.50% increase 0.25%-0.50% decrease		December 31	December 31
		2022 $ (82,728) $ 90,773 $ 86,317 $ (80,577)	2021 $ (110,912) $ 121,286 $ 115,435 $ (104,760)

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

The expected contribution to the plan for the next year The average duration of defined benefit obligation		December 31
	2022 2021 $ 135,886 $ 144,478 7.35-11.84 years 8.04-12.15 years

22. EQUITY

a. Share capital

Common stock

Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued		December 31	December 31
		2022 6,700,000 $ 67,000,000 3,980,000 $ 39,800,002	2021 6,700,000 $ 67,000,000 3,980,000 $ 39,800,002

As of December 31, 2022 and 2021, the balance of the Company’s capital account amounted to NT$39,800,002 thousand, divided into 3,980,000 thousand common shares with a par value of NT$10.

42 - - 118 -

b. Capital surplus

Capital surplus
May be used to offset a deficit, distributed as cash dividends, or transferred to share capital Arising from issuance of share capital Arising from treasury share transactions Arising from conversion of bonds Arising from exercised employee share options Overdue employee share options May only be used to offset a deficit Arising from changes in percentage of ownership interest in subsidiaries Arising from share of changes in capital surplus of associates		December 31
		2022 $ 4,787,673 2,342,036 136,352 208,451 30,749 251,734 28,923 $ 7,785,918	2021 $ 4,787,673 2,342,036 136,352 208,451 30,749 251,726 29,137 $ 7,786,124

The capital surplus generated from the excess of the issuance price over the par value of capital stock (including the stock issued for new capital, mergers and convertible bonds) may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or stock dividends up to a certain percentage of the Company’s paid-in capital. The capital surplus from share of changes in equities of subsidiaries and associates may be used to offset a deficit; however, when generated from issuance of restricted shares for employees, such capital surplus may not be used for any purpose.

c. Retained earnings and dividend policy

According to the Company’s Articles of Incorporation, the Company’s dividend distribution policy is as follows:

From the pre-tax net profit of the current year, before deducting remuneration of employees and remuneration of directors, no more than 1% shall be allocated as remuneration of directors and no less than 1% as remuneration of employees. The remuneration of employees may be distributed in stock or cash upon resolution of the board of directors and may be distributed to the employees of subsidiaries of the Company meeting certain criteria.

However, if the Company has accumulated losses, the Company shall first set aside an amount for making up losses, and then allocate remuneration of employees and remuneration of directors according to the percentage set forth in the preceding paragraph.

The Company purchases its stock for transferring such treasury shares, issues employee options, provides pre-emptive right for employees’ subscription upon issuing new shares, issues new restricted employee shares, and distributes employee remuneration, to employees of the Company’s controlling or subordinated companies who meet certain criteria, which shall be determined and resolved by the board of directors.

43 - - 119 -

If the Company has pre-tax profits at the end of the current fiscal year, after paying all taxes and covering all accumulated losses, the Company shall set aside 10% of said earnings as legal reserve. However, legal reserve need not be made when the accumulated legal reserve equals the paid-in capital of the Company. After setting aside or reversing special reserve pursuant to applicable laws and regulations and orders of competent authorities or based on the business needs of the Company, if there is any balance, the board of directors may submit a proposal for allocation of the remaining balance and the accumulated undistributed earnings to the shareholders meeting for resolution of distributing bonuses and dividends to shareholders.

The board of directors shall be authorized to distribute the profit, the legal reserve and the capital reserve mentioned in the preceding paragraph in cash upon resolution by a majority vote at a board meeting attended by two-thirds or more of the directors, and shall report the same to the shareholders’ meeting.

The Company’s dividend distribution policy is made in accordance with the Company Act and the Articles of Incorporation in consideration of factors including capital and financial structure, operating status, retained earnings, industry characteristics and economic cycle. The dividends shall be distributed in a steady manner. With respect to distribution of dividends, in consideration of future operation scale and cash flow needs, no less than 30% of the remaining amount of the net profit after tax of the current year, after covering the accumulative losses and setting aside the legal reserve and the special reserve, shall be distributed to shareholders as dividends (The Company shall not issue dividends if the dividend is less than NT$0.1.), which may be distributed in stock dividend or cash dividend, and the distribution of cash dividend shall not be less than 50% of total dividends, so as to maintain continuous growth.

The Company may distribute its profit or make up its losses at the end of each half of a fiscal year. The business report, the financial statements, and the proposal for distribution of earnings or making up loss shall be prepared by and then resolved by the board of directors.

The Company, in distributing its profit according to the preceding paragraph, shall estimate and reserve employee and director remuneration and any taxes payable as well as cover any losses and set aside the legal reserve in accordance with the law; however, provided that the legal reserve amounts to the total paid-in capital, the legal reserve need not be set aside. Where the Company distributes the profit in cash, such distribution shall be resolved by the board of directors, but where the profit is distributed in the form of newly issued shares, such distribution shall be resolved by the shareholders’ meeting.

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

Pursuant to existing regulations, the Company is required to set aside additional special capital reserve equivalent to the net debit balance of the other components of shareholders’ equity, such as the accumulated balance of foreign currency translation reserve, unrealized valuation gain (loss) from available-for-sale financial assets, net amount of fair value below the cost of the Company’s ordinary shares held by subsidiaries, etc. For the subsequent decrease in the deduction amount to shareholders’ equity, any special reserve appropriated may be reversed to the extent that the net debit balance reverses.

44 - - 120 -

The appropriations of earnings and cash dividends per share for 2021 and 2020 were as follows:

Legal reserve appropriated Cash dividends	Appropriation of Earnings	Cash Dividends Per Share (NT$) For Year 2021 For Year 2020 $ 1.0 $ 0.2
	For Year 2021 For Year 2020 $ 1,359,595 $ 161,253 3,980,000 796,000 $ 5,339,595 $ 957,253

The above cash dividends were resolved by the board of directors on March 15, 2022 and March 16, 2021, respectively; the other proposed appropriations were resolved by the shareholders in their meetings on May 31, 2022 and August 12, 2021, respectively.

As of the date of the Company’s board meeting (February 16, 2023), the appropriation of earnings for 2022 has not been finalized.

d. Other equity items

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

Exchange differences on translation of the financial statements	of foreign operations	of foreign operations
Balance at January 1 Exchange differences arising on translating the financial statements of foreign operations Balance at December 31	For the Year Ended		December 31
		2022 $ (861,389) 206,737 $ (654,652)	2021 $ (271,328) (590,061) $ (861,389)

The exchange differences arising on translation of foreign operation’s net assets from its functional currency to the Group’s presentation currency are recognized directly in other comprehensive income and also accumulated in the foreign currency translation reserve.

2) Unrealized gains (losses) on financial assets at FVTOCI

Unrealized gains (losses) on financial assets at FVTOCI
Balance at January 1 Unrealized gains (losses) on revaluation of financial assets at FVTOCI Share of unrealized gains (losses) on revaluation of financial assets at FVTOCI of associates accounted for using equity method Disposal of investments in equity instruments designated at FVTOCI Balance at December 31	For the Year Ended December 31
		2022 $ 12,911,356 2,935,470 (529,691) (300,524) $ 15,016,611	2021 $ 8,141,510 2,962,485 1,901,619 (94,258) $ 12,911,356

Unrealized gains (losses) on financial assets at FVTOCI represents the cumulative gains or losses arising from the fair value measurement on financial assets at FVTOCI that are recognized in other comprehensive income. The cumulative gain or loss will not be reclassified to profit or loss on disposal of the equity investments, instead, they will be transferred to retained earnings.

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e. Non-controlling interests

Balance at January 1 Share attributable to non-controlling interests Profit for the year Exchange differences on translation of the financial statements of foreign operations Remeasurement of defined benefit plans Unrealized gains (losses) on financial assets measured at FVTOCI Cash dividends issued by subsidiaries to non-controlling interests Changes in ownership interests in subsidiaries Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 7,589,399 2,059,387 19,189 50,596 (123,806) (1,024,053) 8 $ 8,570,720	2021 $ 5,143,568 1,405,479 (425,126) (23,613) 454,578 (148,788) 1,183,301 $ 7,589,399

23. REVENUE

Refer to Note 36 to the consolidated financial statements for the Group’s revenue.

24. EMPLOYEE BENEFITS EXPENSE, DEPRECIATION, AND AMORTIZATION

Short-term employee benefits Post-employment benefits Depreciation Amortization Short-term employee benefits Post-employment benefits Depreciation Amortization		For	the Year Ended December 31, 2022	the Year Ended December 31, 2022
		Classified as Operating Costs $ 4,479,421 $ 158,664 $ 7,906,136 $ 5,362 For	Classified as Operating Expenses Classified as Non-operating Income and Losses Total $ 14,349,752 $ - $ 18,829,173 $ 717,826 $ - $ 876,490 $ 1,143,992 $ 145,126 $ 9,195,254 $ 321,741 $ 27,000 $ 354,103 the Year Ended December 31, 2021
		Classified as Operating Costs $ 4,502,850 $ 138,514 $ 9,789,579 $ 23,131	Classified as Operating Expenses Classified as Non-operating Income and Losses $ 12,088,668 $ - $ 595,279 $ - $ 1,411,539 $ 160,866 $ 236,648 $ 34,077	Total $ 16,591,518 $ 733,793 $ 11,361,984 $ 293,856

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The remuneration policies of the Company were as follows:

a. Directors:

In accordance with the Article 22 of the Company’s Articles of Incorporation, the distribution of the remuneration of directors shall be appropriated at the rates no more than 1% of net profit before income tax before deducting remuneration to employees and directors. The Remuneration Committee will recommend remuneration to directors in accordance with the Company’s Articles of Incorporation, the internal Rules for Remuneration of Directors and Performance Assessment of The Board of Directors, board members’ self-assessment results, and annual profit deduct the accumulative losses. The remuneration was resolved by the board of directors and reported to the shareholders’ meeting.

b. Managers:

The remuneration of the managers, which depends on responsibilities and performance of individuals to encourage managers to take responsibilities and achieve performance, shall be competitive to attract external talent and stabilize internal talent. The managers have the responsibilities for operating performance, the encouragement shall be taken both short-term and long-term performance into account.

c. Employees:

Employees’ compensation, including fixed and variable compensation, was taken both internal fairness and external competitiveness into consideration. The Company gives bonus immediately and shares operating performance with the employees to attract, encourage and retain the talent. In accordance with the Articles of Incorporation, it stipulates distribution of the compensation of employees at the rates no less than 1% of net profit before income tax before deducting remuneration to employees and directors. The remuneration of employees may be distributed in stock or cash upon resolution of the board of directors and reported to the shareholders’ meeting. Personal salary is determined by responsibilities and professional skills. Bonus and compensation are in relation to individual’s performance and contribution.

For the years ended December 31, 2022 and 2021, the employees’ compensation and remuneration of directors were as follows:

directors were as follows:
Employees’ compensation Remuneration of directors	For the Year Ended	December 31
	2022 Amounts Accrual Rate $ 307,880 2% $ 153,940 1%	2021
		Amounts Accrual Rate $ 330,737 2% $ 165,369 1%

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

The compensation to employees and remuneration to the directors of 2021 and 2020 were approved by the Company’s board of directors on March 15, 2022 and March 16, 2021, respectively, were as below:

Employees’ compensation Remuneration of directors	For the Year Ended	For the Year Ended	December 31
		2021 $ 330,737 $ 165,369	2020 $ 27,831 $ 13,916

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There was no difference between the actual amounts of employees’ compensation and remuneration of directors paid and the amounts recognized in the consolidated financial statements for the years ended December 31, 2021 and 2020.

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

25. INCOME TAXES RELATING TO CONTINUING OPERATIONS

a. Income tax recognized in profit or loss

Major components of income tax expense were as follows:

Major components of income tax expense were as follows:
Current income tax expense Current tax expense Adjustment for prior years Deferred income tax Change in current year Income tax expense recognized in profit or loss	For the Year Ended December 31
		2022 $ 3,476,330 24,139 (440,849) $ 3,059,620	2021 $ 3,088,867 15,163 118,938 $ 3,222,968

Reconciliation of accounting profit and income tax expense were as follows:

Income tax expense from continuing operations at the statutory rate Tax effect of adjustment item Permanent differences Others Current income tax expense Loss carryforwards, investment credits and deductible temporary differences Adjustment for prior years’ income tax expense Tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 4,435,666 (732,576) (358,609) 3,344,481 (309,000) 24,139 $ 3,059,620	2021 $ 4,405,341 (533,465) (180,071) 3,691,805 (484,000) 15,163 $ 3,222,968

Based on the Income Tax Act in the ROC, the corporate income tax rate is 20%. Tax rates used by other group entities operating in other jurisdictions are based on the tax laws in those jurisdictions.

b. Current tax assets and liabilities

Current tax assets and liabilities
Current tax assets Income tax refund receivable (Note 11) Current tax liabilities Income tax payables		December 31
		2022 $ 38,037 $ 2,123,413	2021 $ 77,826 $ 2,704,871

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c. Deferred tax assets

As of December 31, 2022 and 2021, deferred income tax assets of NT$1,191,547 thousand and NT$774,072 thousand, respectively, were mainly generated from idle capacity, unrealized inventory losses and asset impairment losses.

d. Deferred tax liabilities

As of December 31, 2022 and 2021, deferred income tax liabilities of NT$13,209 thousand and NT$36,583 thousand, respectively, were mainly generated from unrealized valuation gains or losses on financial assets at FVTOCI.

e. Tax return assessments

The tax returns of the Company and NTC through 2020 have been assessed by the tax authorities.

26. EARNINGS PER SHARE

	For the Year En	d December 31
2022	Earnings Per Share (NT$) Net Income After Income Tax (Attributable to Owners of the Parent) $ 3.25 $ 3.23	2021
Amounts (Numerator) Net Income After Income Tax (Attributable to Owners of the Parent) Shares (Denominator) (In Thousands) $ 12,927,165 3,980,000 - 17,642 $ 12,927,165 3,997,642		Amounts (Numerator) Net Income After Income Tax (Attributable to Owners of the Parent) Shares (Denominator) (In Thousands) $ 13,594,643 3,980,000 - 9,930 $ 13,594,643 3,989,930	Earnings Per Share (NT$)
			Net Income After Income Tax (Attributable to Owners of the Parent) $ 3.42 $ 3.41

If the Company offered to settle the compensation or bonuses paid to employees by cash or shares, the Company assumed that the entire amount of the compensation or bonuses will be settled in shares and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share (EPS), if the shares have a dilutive effect. Such dilutive effect of the potential shares is included in the computation of diluted EPS until the number of shares to be distributed to employees is resolved in the following year.

27. GOVERNMENT GRANTS

As of December 31, 2022, the Company received government loan of NT$5,131,600 thousand at a below-market interest rate. It will be used in the purchase of machinery and equipment and for supporting working capital. The first installment will be made in the 36th-37th month of the principal, and each month thereafter, the principal will be repaid in 48-49 equal installments. Using the prevailing market interest rates of 1.79%-1.89% for an equivalent loan, the fair value of the loan was estimated at NT$4,837,630 thousand on initial recognition. The difference of NT$293,970 thousand between the proceeds and the fair value of the loan is the benefit derived from the below-market rate of interest which has been recognized as deferred revenue. The deferred revenue will be recognized as other income during the loan period accordingly. For the years ended December 31, 2022 and 2021, the other income under government grants were amounts of

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NT$47,599 thousand and NT$20,485 thousand, respectively, and the interest expense under loans were amounts of NT$94,824 thousand and NT$30,781 thousand, respectively.

28. BUSINESS COMBINATIONS

a. Subsidiaries acquired

			Proportion of
			Voting Equity
		Date of	Interests	Consideration
Subsidiary	Principal Activity	Acquisition	Acquired (%)	Transferred
METC	Software and hardware	November 1,	100	$	357,898
	integration design of	2021
	semiconductor
WECJ	Research, development, sales	November 30,	100	$	190,070
	and after-sales service of	2022
	semiconductor

The Company acquired 100% ownership interest of WECJ and METC from the subsidiary Landmark and the sub-subsidiary NTCJ, respectively. The transaction was a reorganization under common control, and was recognized as an equity transaction.

b. Assets acquired and liabilities assumed

Current assets Cash and cash equivalents Accounts receivable and other receivables Inventories Other current assets Non-current assets Property, plant and equipment Right-of-use assets Intangible assets Deferred income tax assets Other non-current assets Total assets Current liabilities Accounts payable and other payables Current tax liabilities Other current liabilities Other non-current liabilities Total liabilities Net assets	WECJ $ 76,255 797,517 - 6,328 4,064 17,505 1,934 37,709 6,270 $ 947,582 $ 716,492 18,329 14,261 8,430 $ 757,512 $ 190,070	METC $ 298,304 101,201 39,835 6,147 6,146 - 14,728 65,349 -
		$ 531,710
		$ 291,280 17,717 55,053 -
		$ 364,050
		$ 167,660

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c. Equity transaction difference under common control

Fair value of identifiable net assets acquired Less: Consideration transferred Equity transaction difference Equity transaction difference adjustment account Investments accounted for using equity method - NTC Capital surplus - changes in ownership interests in subsidiaries Equity transaction difference	WECJ $ 190,070 (190,070) $ - $ - - $ -	METC $ 167,660 (357,898) $ (190,238) $ 97,887 92,351 $ 190,238

29. CAPITAL MANAGEMENT

The Group’s capital management objective is to ensure it has the necessary financial resources and operational plan so that it can cope with the next twelve months working capital requirements, capital expenditures, research and development activities, debt repayments and dividends payments.

30. FINANCIAL INSTRUMENT

a. Fair value of financial instruments
1) Valuation techniques and assumptions used in fair value measurement

The fair values of financial assets and financial liabilities are determined as follows:

The fair values of financial assets and financial liabilities with standard terms and conditions and traded on active liquid markets are determined with reference to quoted market prices (includes publicly traded stock and mutual funds).
The fair values of derivative foreign exchange contracts are measured using quoted middle and discount rates of foreign exchange contracts matching the foreign exchange rate on the maturity date of the contracts.
Domestic and overseas unlisted equity instrument at FVTPL and FVTOCI were all measured based on Level 3. Fair values of the above equity instruments were determined using discounted cash flow of income approach and comparable listed company approach, refer to strike price of similar business at active market, implied value multiple of the price and relevant information. Significant unobservable inputs included PE ratio, value multiple and market liquidity discount.
2) Fair value measurements recognized in the consolidated balance sheets

The fair value of financial instruments are grouped into Levels 1 to 3 based on the degree to observability of inputs.

Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;
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Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
Level 3 inputs are unobservable inputs for an asset or liability.
3) Fair value of financial instruments that are not measured at fair value

Fair value hierarchy as at December 31, 2022

Financial liabilities Financial liabilities measured at amortized cost Bonds payable (secured) Fair value hierarchy as at December	Level 1 $ - 31, 2021 Level 1 $ -	Level 2 $ 9,968,462 Level 2 $ 9,956,086	Level 3 $ - Level 3 $ -	Total $ 9,968,462
				Total $ 9,956,086
Financial liabilities Financial liabilities measured at amortized cost Bonds payable (secured)

4) Fair value of financial instruments that are measured at fair value on a recurring basis

Fair value hierarchy as at December	31, 2022 Level 1 $ - 44,433 - 110,506 $ 154,939 $ 14,705,736 - - $ 14,705,736 $ -	Level 2 $ 7,173 - - - $ 7,173 $ - 22,560 - $ 22,560 $ 7,412	Level 3 $ 121,775 - 61,420 - $ 183,195 $ - 1,684,488 1,231,877 $ 2,916,365 $ -	Total $ 128,948 44,433 61,420 110,506
Financial assets Financial assets at FVTPL Derivative financial assets Non-derivative financial assets Domestic listed and emerging securities Overseas unlisted securities Mutual funds Financial assets at FVTOCI Equity securities Domestic listed and emerging securities Domestic and overseas unlisted securities Mutual funds Financial liabilities Financial liabilities at FVTPL Derivative financial liabilities
				$ 345,307
				$ 14,705,736 1,707,048 1,231,877
				$ 17,644,661
				$ 7,412

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Fair value hierarchy as at December 31, 2021

Fair value hierarchy as at December	31, 2021
Financial assets Financial assets at FVTPL Derivative financial assets Non-derivative financial assets Overseas unlisted securities Mutual funds Financial assets at FVTOCI Equity securities Domestic listed and emerging securities Domestic and overseas unlisted securities Mutual funds	Level 1 $ - - 108,700 $ 108,700 $ 11,235,587 - - $ 11,235,587	Level 2 $ 51,688 - - $ 51,688 $ - 21,010 - $ 21,010	Level 3 $ 69,200 55,360 - $ 124,560 $ - 2,437,731 765,011 $ 3,202,742	Total $ 120,888 55,360 108,700
				$ 284,948
				$ 11,235,587 2,458,741 765,011
				$ 14,459,339

5) Reconciliation of Level 3 fair value measurements of financial instruments

The financial assets measured at Level 3 fair value were non-derivative financial assets classified as financial assets at FVTPL and equity investments classified as financial assets at FVTOCI. Reconciliations for the years ended December 31, 2022 and 2021 were as follows:

Balance at January 1 Additions Recognized in other comprehensive income Recognized in profit or loss Reclassified to investments accounted for using equity method Proceeds from capital reduction of investment Effect of exchange rate changes Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 3,327,302 800,383 190,439 7,575 (1,289,679) (1,000) 64,540 $ 3,099,560	2021 $ 1,908,328 289,439 1,146,473 (563) - (4,500) (11,875) $ 3,327,302

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b. Categories of financial instruments

Fair values of financial assets and liabilities were summarized as follows:

Financial assets Measured at amortized cost Cash and cash equivalents Accounts receivable (included related parties) Financial lease receivables (current and non-current) Other receivables Refundable deposits (recorded in other non-current assets) Financial assets at fair value through profit or loss (current and non-current) Financial assets at fair value through other comprehensive income (current and non-current) Financial liabilities Measured at amortized cost Short-term borrowings Notes and accounts payable (included related parties) Payable on equipment and other payables Bonds payable Long-term borrowings (included current portion) Guarantee deposits (recorded in other non-current liabilities) Financial liabilities at fair value through profit or loss	December 31	December 31
	2022 Carrying Amount Fair Value $ 20,402,936 $ 20,402,936 9,873,405 9,873,405 220,182 220,182 558,836 558,836 573,743 573,743 345,307 345,307 17,644,661 17,644,661 1,069,040 1,069,040 6,391,671 6,391,671 13,270,593 13,270,593 9,968,462 9,968,462 37,449,502 37,449,502 2,473,353 2,473,353 7,412 7,412	2021
		Carrying Amount Fair Value $ 30,914,427 $ 30,914,427 12,154,855 12,154,855 - - 1,267,026 1,267,026 529,290 529,290 284,948 284,948 14,459,339 14,459,339 1,430,317 1,430,317 7,600,734 7,600,734 14,409,181 14,409,181 9,956,086 9,956,086 14,133,865 14,133,865 2,072,448 2,072,448 - -

c. Financial risk management objectives and policies

The Group’s Corporate Treasury function provides services to the business, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Group through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk, credit risk and liquidity risk.

The use of financial derivatives was governed by the Group’s policies approved by the board of directors, which provide written principles on foreign exchange risk, and use of financial derivatives. Compliance with policies and exposure limits was reviewed by the internal auditors on a continuous basis.

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1) Market risk

The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. The Group uses forward foreign exchange contracts to hedge the foreign currency risk on export.

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

a) Foreign currency risk

The Group uses forward foreign exchange contracts to hedge the exchange rate risk within approved policy parameters utilizing forward foreign exchange contracts.

The sensitivity analysis included only outstanding foreign currency denominated monetary items at the end of the reporting period and an increase in net income and equity if New Taiwan dollars strengthen by 1% against foreign currencies. For a 1% weakening of New Taiwan dollars against U.S. dollars, there would be impact on net income increase in the amounts of NT$76,527 thousand and NT$66,323 thousand for the years ended December 31, 2022 and 2021, respectively.

b) Interest rate risk

The Group’s interest rate risk arises primarily from floating rate borrowings.

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

of the reporting period were as follows:
Cash flow interest rate risk Financial assets Financial liabilities	December 31
	2022 2021 $ 8,413 $ 8,413 38,700,640 15,699,041

The sensitivity analyses below were determined based on the Group’s exposure to interest rates for fair value of variable-rate derivatives instruments at the end of the reporting period. If interest rates had been higher by 1%, the Group’s cash flows would have increased by NT$386,922 thousand and NT$156,906 thousand for the years ended December 31, 2022 and 2021, respectively.

2) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the Group.

The Group adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. In order to minimize credit risk, the management of the Group has delegated a team responsible for determination of credit limits, credit approvals and other monitoring procedures to ensure that follow-up action is taken to recover overdue receivables. In addition, the Group reviews the recoverable amount of each individual accounts receivables at the end of the reporting period to ensure that adequate impairment losses are recognized for irrecoverable amounts. In this regard, the directors of the Group consider that the Group’s credit risk was significantly reduced.

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3) Liquidity risk

The Group has enough operating capital to comply with loan covenants; liquidity risk is low.

The Group’s non-derivative financial liabilities and their agreed repayment period were as follows:

Non-interest bearing Lease liabilities Variable interest rate liabilities Fixed interest rate liabilities		December 31, 2022	December 31, 2022
	Within 1 Year $ 19,662,264 313,517 4,240,468 - $ 24,216,249	1-2 Years $ 2,473,353 258,010 6,923,041 - $ 9,654,404	Over 2 Years $ - 2,129,430 27,537,131 10,000,000 $ 39,666,561	Total $ 22,135,617 2,700,957 38,700,640 10,000,000 $ 73,537,214

Additional information about the maturity analysis for lease liabilities:

Less than 2 Years 2-5 Years Over 5 Years Lease liabilities $ 571,527 $ 572,922 $ 1,556,508 December 31, 2021 Within 1 Year 1-2 Years Over 2 Years Total Non-interest bearing $ 22,009,915 $ 2,072,448 $ - $ 24,082,363 Lease liabilities 378,266 330,741 2,765,867 3,474,874 Variable interest rate liabilities 2,002,441 1,641,429 12,055,171 15,699,041 Fixed interest rate liabilities 212,976 - 10,000,000 10,212,976 $ 24,603,598 $ 4,044,618 $ 24,821,038 $ 53,469,254 Additional information about the maturity analysis for lease liabilities: Less than 2 Years 2-5 Years Over 5 Years Lease liabilities $ 709,007 $ 728,362 $ 2,037,505		Less than 2 Years 2-5 Years Over 5 Years $ 571,527 $ 572,922 $ 1,556,508 December 31, 2021

4) Transfers of financial assets

NTC’s factored accounts receivables that are not yet overdue were as follows:

December 31, 2022: None.

December 31, 2021

Counterparty Receivables Factoring Proceeds Sumitomo Mitsui Banking Corporation $ 98,885	Advances Received - Unused $ -	Advances Received - Used Annual Interest Rates on Advances Received (Used) (%) $ 98,885 0.9

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Pursuant to the NTC’s factoring agreements, losses from commercial disputes (such as sales returns and discounts) are borne by NTC, while losses from credit risk are borne by the banks.

31. RELATED PARTY TRANSACTIONS

a. The names and relationships of related parties are as follows:

Related Party
Walsin Lihwa Corporation
Hwa Bao Botanic Conservation Corp.
Chin Xin Investment Co., Ltd.
TPSCo.
Nyquest Technology Co., Ltd.
Walton Advanced Engineering Inc.
Walton Advanced Engineering Ltd. (Suzhou)
Chin Cherng Construction Co., Ltd.
Walsin Technology Corporation
United Industrial Gases Co., Ltd.
Hannstar Display Corporation
Glorystone Inc.
Waltech Advanced Engineering (Suzhou) Ltd.
CHIA-HO Green Energy Corporation
Taiwan Cement Corporation

Relationship with the Group

Investor that exercises significant influence over the
Group
Associate
Associate
Associate (Note)
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance

Note: The Group has significant influence over TPSCo. since April 2022, therefore TPSCo. has been reclassified from related party in substance to associate. Refer to Note 13 to the consolidated financial statements.

b. Operating activities

perating activities
1) Operating revenue Related party in substance Associate	For the Year Ended December 31
		2022 $ 3,506,794 251,640 $ 3,758,434	2021 $ 4,040,351 - $ 4,040,351

Price and terms were determined in accordance with mutual agreements.

2) Purchases of goods Associate TPSCo. Related party in substance TPSCo. Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 3,099,787 1,498,020 - $ 4,597,807	2021 $ - 6,319,062 111,089 $ 6,430,151

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Price and terms were determined in accordance with mutual agreements.

3) Manufacturing expenses Related party in substance Walton Advanced Engineering Inc. Others Associate 4) Operating expenses Associate Related party in substance Investor that exercises significant influence over the Group 5) Dividend income Investor that exercises significant influence over the Group Walsin Lihwa Corporation Related party in substance HannStar Display Corporation United Industrial Gases Co., Ltd. Others 6) Other income and expenses Associate Related party in substance 7) Accounts receivable Related party in substance Associate	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 2021 $ 2,942,876 $ 3,256,561 2,021,444 2,970,167 1,408,002 - $ 6,372,322 $ 6,226,728 $ 233,901 $ - 125,172 407,834 14,078 13,788 $ 373,151 $ 421,622 $ 355,200 $ 199,800 149,330 75,000 67,118 62,000 58,488 67,495 $ 630,136 $ 404,295 $ 12,190 $ 64 977 1,097 $ 13,167 $ 1,161 December 31
		2022 $ 700,437 35,222 $ 735,659	2021 $ 639,262 - $ 639,262

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8) Accounts payable Related party in substance Associate 9) Other receivables and other current assets Associate TPSCo. Related party in substance TPSCo. Others 10) Other payables and other current liabilities Associate Related party in substance Investor that exercises significant influence over the Group 11) Refundable deposits (recorded in “other non-current assets”) Related party in substance Investor that exercises significant influence over the Group 12) Guarantee deposits (recorded in “other non-current liabilities”) Related party in substance		December 31	December 31
		2022 $ 936,286 252,642 $ 1,188,928 $ 54,318 - 340 $ 54,658 $ 188,807 155,132 - $ 343,939 $ 1,722 203 $ 1,925 $ 250,594	2021 $ 1,344,195 - $ 1,344,195 $ - 262,957 4,396 $ 267,353 $ - 217,462 4 $ 217,466 $ 1,722 203 $ 1,925 $ 225,869

The Group’s transactions with the related party were conducted in accordance with bilateral contracts, covering transaction price and payment terms.

c. Acquisition of property, plant and equipment

Acquisition of property, plant and equipment
Associate Related party in substance	Purchase Price
	For the Year Ended December 31
		2022 $ 112,128 31,725 $ 143,853	2021 $ - - $ -

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d. Disposal of property, plant and equipment

Disposal Price Gain (Loss) on Disposal For the Year Ended December 31 For the Year Ended December 31 2022 2021 2022 2021 Associate TPSCo. $ 72,749 $ - $ 155 $ - Hwa Bao Botanic Conservation Corp. 55,200 - 36,181 - Related party in substance Waltech Advanced Engineering (Suzhou) Ltd. - 886,862 - 144,679 Others 68 628 68 595 $ 128,017 $ 887,490 $ 36,404 $ 145,274 The price of above transactions were determined based on the acquisition cost of the machinery equipment and reference to the recent quoted market price. Refer to Note 31 (g) to the consolidated financial statements for details of finance lease contracts. Disposal of intangible assets Disposal Price Gain(Loss) on Disposal For the Year Ended December 31 For the Year Ended December 31 2022 2021 2022 2021 Associate TPSCo. $ 204,873 $ - $ 16 $ -		Gain (Loss) on Disposal	Gain (Loss) on Disposal
		For the Year Ended December 31
		For the Year Ended December 31
		2022 $ 16	2021 $ -

The price of above transactions were determined based on the acquisition cost of the machinery equipment and reference to the recent quoted market price.

e. Disposal of intangible assets

The price of above transactions were determined based on the acquisition cost of the intangible asset and reference to the recent quoted market price.

Refer to Note 31 (g) to the consolidated financial statements for details of finance lease contracts.

f. Lease arrangements - the Group is lessee

Lease arrangements - the Group is lessee
1) Acquisition of right-of-use assets Investor that exercises significant influence over the Group Related party in substance	For the Year Ended December 31
		2022 $ 1,033 - $ 1,033	2021 $ - 1,350 $ 1,350

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2) Lease liabilities Investor that exercises significant influence over the Group Related party in substance 3) Interest expense Investor that exercises significant influence over the Group Related party in substance		December 31	December 31
	2022 2021 $ 5,845 $ - - 11,993 $ 5,845 $ 11,993 For the Year Ended December 31
		2022 $ 89 87 $ 176	2021 $ 20 273 $ 293

g. Lease arrangements - the Group is lessor/sublease arrangements
Lease arrangements sublease arrangement under operating leases

NTC subleased its right-of-use asset to TPSCo. under operating lease with lease term of 12 years, and the rental is based on similar asset’s market rental rates and fixed lease payments are received monthly.

1) Operating lease receivables Associate TPSCo. Related party in substance TPSCo. 2) Future lease payment receivables Associate TPSCo. Related party in substance TPSCo.		December 31	December 31
		2022 $ 19,770 - $ 19,770 $ 1,402,999 - $ 1,402,999	2021 $ - 20,459 $ 20,459 $ - 1,607,021 $ 1,607,021

61 - - 137 -

3) Lease income Associate TPSCo. Related party in substance TPSCo.	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 155,271 55,912 $ 211,183	2021 $ - 237,011 $ 237,011

NTCJ leased out equipment and intangible assets to its associate company, TPSCo., under finance leases with 3-year lease term from the second quarter of 2022. The net investment in leases was NT$277,390 thousand at the inception of the lease and the contract has average implicit interest rate of approximately 1.85% per year. The rental is based on similar asset’s market rental rates and the fixed lease payment of JPY107,719 thousand is received quarterly.

As of December 31, 2022, the balance of finance lease receivables was NT$220,182 thousand and no impairment loss was recognized for the year ended December 31, 2022. There was also no gain or loss on the disposal of equipment and intangible assets. The amounts of interest income under finance leases for the year ended December 31, 2022 were NT$3,552 thousand.

h. Disposal of right-of-use assets

In June 2022, NTCJ transferred lease agreement of machinery equipment originally recorded as a right-of-use assets to TPSCo. and generated a gain on lease modification of approximately NT$178,623 thousand. NTC recognized a deferred gain on lease modification of NT$87,526 thousand based on its 49% shareholding ratio, which will be recognized in accordance with the remaining term of the contract.

i. Acquisition of shares

For the year ended December 31, 2022

		Number of
Related Party Category/Name	Line Item	Shares	Underlying Assets	Purchase Price
Investor that exercises
significant influence over the
Group
Walsin Lihwa Corporation	Current financial assets at	25,527,493	Ordinary shares of	$	765,825
	FVTOCI		Walsin Lihwa
			Corporation
Related party in substance
CHIA-HO Green Energy	Non-current financial	55,500,000	Ordinary shares of		555,000
Corporation	assets at FVTOCI		CHIA-HO Green
			Energy Corporation
Associate
TPSCo.	Investments accounted for	30,919	Ordinary shares of		358,772
	using equity method		TPSCo.
Hwa Bao Botanic	Investments accounted for	21,000	Ordinary shares of Hwa		210,000
Conservation Corp.	using equity method		Bao Botanic
			Conservation Corp.
				$	1,889,597

For the year ended December 31, 2021: None.

62 - - 138 -
j. Guarantee

Acquisition of guarantee

The chairman of NTC is a joint guarantor of the land-leasing from Taiwan Sugar Corporation. Refer to Note 15 to the consolidated financial statements.

k. Compensation of key management personnel

Compensation of key management personnel
Short-term employment benefits Post-employment benefits	For the Year Ended December 31
		2022 $ 964,014 9,447 $ 973,461	2021 $ 619,221 25,570 $ 644,791

The remuneration of directors and key management personnel was suggested by the remuneration committee having regard to the performance of individuals and market trends. And the remuneration was resolved by the board of directors.

32. PLEDGED AND COLLATERALIZED ASSETS

Refer to Notes 6, 14 and 16 to the consolidated financial statements.

33. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

Significant contingent liabilities and unrecognized commitments of the Group as of the end of the reporting period, excluding those disclosed in other notes, were as follows:

a. Amounts available under unused letters of credit as of December 31, 2022 and 2021 were approximately US$3,957 thousand and US$75,493 thousand, JPY321,200 thousand and JPY310,190 thousand and EUR0 thousand and EUR550 thousand, respectively.
b. The Company’s unrecognized commitments were as follows:

December 31, 2022 Acquisition of property, plant and equipment $ 23,102,440

c. N Company filed a complaint in the U.S. District Court for the District of Delaware on November 24, 2021. The plaintiff alleged that NTCA (and NTCA only) infringes one of its patents. N Company withdrew the complaint in the U.S. District Court for the District of Delaware in February 2022 and the case was closed.

34. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The following information was aggregated by the foreign currencies other than functional currencies of the Group entities and the exchange rates between foreign currencies and respective functional currencies were disclosed.

63 - - 139 -

The significant assets and liabilities denominated in foreign currencies were as follows:

Financial assets Monetary items USD USD EUR JPY RMB ILS SGD Financial liabilities Monetary items USD USD EUR JPY ILS	Decem	ber 31
	2022 Foreign Currencies (In Thousands) Exchange Rate (Note 1) New Taiwan Dollars (In Thousands) $ 417,963 30.71 $ 12,835,638 57,785 132.14 (Note 2) 1,774,585 1,546 32.72 50,594 3,612,672 0.2324 839,585 13,695 4.408 60,366 9,720 8.7301 84,860 2,308 22.88 52,814 195,653 30.71 6,008,507 31,253 132.14 (Note 2) 959,778 3,530 32.72 115,492 3,615,868 0.2324 840,328 14,046 8.7301 122,624	2021
		Foreign Currencies (In Thousands) Exchange Rate (Note 1) New Taiwan Dollars (In Thousands) $ 449,183 27.68 $ 12,433,390 35,252 115.09 (Note 2) 975,769 1,390 31.32 43,527 2,165,741 0.2405 520,861 126,013 4.344 547,400 9,584 8.8912 85,210 522 20.46 10,687 214,994 27.68 5,951,028 30,482 115.09 (Note 2) 843,735 49,260 31.32 1,542,839 3,844,180 0.2405 924,525 22,798 8.8912 202,702

Note 1: Except as otherwise noted, exchange rate represents the number of New Taiwan dollars for which one unit of foreign currency could be exchanged.
Note 2: The exchange rate represents the number of JPY for which one U.S. dollar could be exchanged.

For the years ended December 31, 2022 and 2021, refer to the consolidated statements of comprehensive income for details on realized and unrealized net foreign exchange profit (loss). It is impractical to disclose net foreign exchange gains (losses) by each significant foreign currency due to the variety of the foreign currency transactions and functional currencies of the group entities.

35. ADDITIONAL DISCLOSURE

a. Following are the additional disclosures for material transactions, which the major transactions of parent and subsidiaries and their balances have been fully eliminated when preparing the consolidated financial report:

1)	Financings provided	None
2)	Endorsements/guarantees provided	Table1
3)	Marketable securities held (excluding investments in subsidiaries and associates)	Table 2
4)	Marketable securities acquired and disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital	Table 3
5)	Acquisition of individual real estate properties at costs of at least NT$300 million or 20% of the paid-in capital	Table 4
6)	Disposal of individual real estate properties at prices of at least NT$300 million or 20% of the paid-in capital	None
7)	Total purchases from or sales to related parties of at least NT$100 million or 20% of the paid-in capital	Table 5
8)	Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital	Table 6
9)	Informationabout the derivativefinancial instruments transaction	Note 7
10)	Intercompany relationships and significant intercompany transactions	Table 9

64 - - 140 -
b. Information on investments: Refer to Table 7 attached.
c. Information on investment in mainland China

1)	The name of the investee in mainland China, the main businesses and products, its issued capital, method of investment, information on inflow or outflow of capital, percentage of ownership, income (losses) of the investee, share of profits (losses) of investee, ending balance, amount received as dividends from the investee, and the limitationon investee.	Table 8
2)	Significant direct or indirect transactions with the investee, its prices and terms of payment, unrealized gain or loss, and other related information which is helpful to understand the impact of investment in mainland China on financial reports. a) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period. b) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period. c) The amount of property transactions and the amount of the resultant gains or losses. d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes. e) The highest balance, the ending balance, the interest rate range, and total current period interest with respect to the financing of funds. f) Other transactions that have a material effect on the profit or loss for the year or on the financial position, such as the rendering or receipt of services.	Table 8

d. Information on major shareholders: Refer to Table 10 attached.

36. SEGMENT INFORMATION

a. Basic information about operating segment
1) Classification of operating segments

The Group’s reportable segments under IFRS 8 “Operating Segments” was as follows:

a) Segment of DRAM IC product

The DRAM IC product segment engages mainly in the manufacturing, selling, researching, designing and after-sales service of Mobile RAM and Specialty DRAM.

b) Segment of Flash Memory product

The Flash Memory product segment engages mainly in the manufacturing, selling, researching, designing and after-sales service of Flash Memory product.

c) Segment of Logic IC product

The Logic IC product segment engages mainly in the manufacturing, selling, researching, designing and after-sales service of Logic IC product.

65 - - 141 -
2) Principles of measuring reportable segments, profit, assets and liabilities

The significant accounting principles of each operating segment are the same as those stated in Note 4 to the consolidated financial statements. The Group’s operating segment profit or loss represents the profit or loss earned by each segment. The profit or loss is controllable by segment managers and is the basis for assessment of segment performance. Individual segment assets are disclosed as zero since those measures are not reviewed by the chief operating decision maker. Major liabilities are arranged based on the capital cost and deployment of the whole company, which are not controlled by individual segment managers.

b. Segment revenues and operating results

The following was an analysis of the Group’s revenue from continuing operations by reportable segments.

DRAM IC product Flash Memory product Logic IC product Total of segment revenue Other revenue Operating revenue Unallocated expenditure Administrative and supporting expenses Sales and other common expenses Income from operations Non-operating income and expenses Interest income Dividend income Other income Share of profit (loss) of associates Gains (losses) on disposal of property, plant and equipment Gains (losses) on disposal of intangible assets Gains (losses) on disposal of investments Gains (losses) on disposal of non-current held for sale assets Gains (losses) on foreign exchange		Segment Revenue For the Year Ended December 31 2022 2021 $ 21,928,754 $ 26,386,578 29,863,054 31,895,039 41,640,173 41,086,910 93,431,981 99,368,527 1,097,809 201,397 $ 94,529,790 $ 99,569,924		Segment Profit and Loss	Segment Profit and Loss
				For the Year Ended December 31
		2022 $ 21,928,754 29,863,054 41,640,173 93,431,981 1,097,809 $ 94,529,790		2022 $ 7,071,962 13,294,130 8,689,183 29,055,275 1,097,809 (8,301,233) (5,317,270) 16,534,581 154,580 634,979 540,182 512,295 357,146 91 - 36,181 968,662	2021 $ 8,143,308 13,516,475 7,647,126 29,306,909 201,397 (6,044,264) (5,036,120) 18,427,922 58,948 404,585 477,608 197,908 174,642 (4,803) (436) 30,371 (106,710) (Continued)

66 - - 142 -

Gains (losses) on financial instruments at fair value through profit or loss Interest expense Other expenses Impairment loss recognized on property, plant and equipment Income before income tax	Segment Revenue For the Year Ended December 31 2022 2021		Segment Profit and Loss	Segment Profit and Loss
			For the Year Ended December 31
			2022 $ (962,983) (94,874) (522,402) (112,266) $ 18,046,172	2021 $ 64,345 (205,883) (512,458) (782,949) $ 18,223,090 (Concluded)

c. Geographical information

The Group’s revenue from continuing operations from external customers by location of operations and information about its non-current assets (non-current assets exclude financial instruments, deferred income tax assets and post-employment benefit assets) by location of assets are detailed below.

Revenue from External Customers For the Year Ended December 31 2022 2021 $ 85,135,882 $ 92,987,128 5,412,842 3,779,368 3,584,558 2,545,900 396,508 257,528 $ 94,529,790 $ 99,569,924	Non-current Assets	Non-current Assets

	December 31
2022 $ 85,135,882 5,412,842 3,584,558 396,508 $ 94,529,790	2022 $ 100,482,950 203,979 - - $ 100,686,929	2021 $ 66,879,643 189,773 - - $ 67,069,416

d. Major customer information

For the years ended December 31, 2022 and 2021, the Group’s operating revenue were NT$94,529,790 thousand and NT$99,569,924 thousand and single customer contacting 10% or more to the Group’s operating revenue were NT$14,393,996 thousand and NT$13,524,520 thousand, respectively. For the years ended December 31, 2022 and 2021, there was no other individual customer exceeded 10% of the Group’s operating revenue.

67 - - 143 -

Note	Note
Endorsement/ Guarantee Given on Behalf of Companies in Mainland China		N	N
Endorsement/ Guarantee Given by Subsidiaries on Behalf of Parent		N	N
Endorsement/ Guarantee Given by Parent on Behalf of Subsidiaries		Y	Y
Aggregate Endorsement/ Guarantee Limit		$ 47,081,498 (Note 5)	17,565,938 (Note 6)
Ratio of Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements (%)		7.40	11.85
	Amount Endorsed/ Guaranteed by Collateral	$ -	-
	Actual Borrowing Amount	$ 952,840 (JPY 4,100,000)	659,040 (JPY 287,980) and (USD 19,281)
	Outstanding Endorsement/ Guarantee at the End of the Period	$ 6,972,000 (JPY 30,000,000) (Note 3)	2,080,810 (JPY 5,650,000) and (USD 25,000) (Note 4)
	Maximum Amount Endorsed/ Guaranteed During the Period	$ 10,706,900 (JPY 46,071,000) (Note 3)	2,080,810 (JPY 5,650,000) and (USD 25,000) (Note 4)
	Limit on Endorsement/ Guarantee Given on Behalf of Each Party	$ 17,103,199 (Note 1)	17,565,938 (Note 2)
Endorsee/Guarantee	Relationship	NTC’s indirect subsidiary with 100% ownership	Subsidiary
	Name	NTCJ	NTCJ
	Endorser/Guarantor	WEC	NTC
	No.	0	1

144 -

	Note
December 31, 2022	Fair Value	$ 11,683,298 1,672,502 663,609 568,211 212 12,450 10,110 7,671 124 - 548,709 10,993 3,679 29,761
	Percentage of Ownership (%)	7 5 2 10 - - - 10 5 16 15 - - -
	Carrying Amount	$ 11,683,298 1,672,502 663,609 568,211 212 12,450 10,110 7,671 124 - 548,709 10,993 3,679 29,761
	Shares/Units	247,527,493 150,000,210 8,400,117 50,062,641 5,305 3 1 1,000,000 5,440 4,000,000 55,500,000 182,000 65,000 829,000
	Financial Statement Account	Current financial assets at fair value through other comprehensive income ″ ″ ″ ″ Non-current financial assets at fair value through other comprehensive income ″ ″ ″ ″ ″ Current financial assets at fair value through profit or loss ″ ″
	Relationship with the Holding Company	The investee’s chairman are relatives within the second degree of relationship of WEC’s chairman. As WEC’s corporate director, the investee held 22.20% ownership interest in WEC. The investee’s chairman are relatives within the second degree of relationship of WEC’s chairman. The investee’s chairman are relatives within the second degree of relationship of WEC’s chairman. The investee’s chairman are relatives within the second degree of relationship of WEC’s chairman. WEC as the investee’s director. None None None WEC as the investee’s director WEC as the investee’s supervisor None WEC’s chairman as an independent director of the investee’s parent company None None None
	Type and Name of Marketable Securities	Shares Walsin Lihwa Corporation Hannstar Display Corporation Walsin Technology Corporation Walton Advanced Engineering Inc. Cathay Financial Holdings Co., Ltd. Shares Hsin Chu Golf Country Club Linkou Golf Course Corporation Intellectual Property Innovation Corporation Harbinger III Venture Capital Corp. Smart Catch International Co., Ltd. CHIA-HO Green Energy Corporation Preferred stocks Fubon Financial Holding Co., Ltd. Preferred Shares B (2881A) Cathay Financial Holding Co., Ltd. Preferred Stock B (2882A) Shin Kong Financial Holding Co., Ltd. Preferred Shares B (2888B)
	Company Name	WEC

145 -

	Note
December 31, 2022	Fair Value	USD 2,000 USD 1,804 USD 1,794 USD 25,191 USD 14,922 JPY - INR 30,010 9,844 919 492,800 614,200 76,775 45,000 116,985 -
	Percentage of Ownership (%)	1 - - 7 4 1 10 5 - 4 9 - - 5 1
	Carrying Amount	USD 2,000 USD 1,804 USD 1,794 USD 25,191 USD 14,922 JPY - INR 30,010 9,844 919 492,800 614,200 76,775 45,000 116,985 -
	Shares/Units	377,808 24,000 17,000 - - 10 3,001,000 575,000 34,680 8,800,000 3,932,816 - - 1,650,000 50,268
	Financial Statement Account	Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss ″ Non-current financial assets at fair value through other comprehensive income ″ Non-current financial assets at fair value through other comprehensive income Non-current financial assets at fair value through other comprehensive income Non-current financial assets at fair value through other comprehensive income ″ ″ ″ Non-current financial assets at fair value through profit or loss ″ Non-current financial assets at fair value through other comprehensive income Non-current financial assets at fair value through other comprehensive income
	Relationship with the Holding Company	None None None None None None The held company as the investee’s director The held company as the investee’s director None The held company as the investee’s director None None None The held company as the investee’s director None
	Type and Name of Marketable Securities	Shares Kneron Holding Company Funds Vanguard Short-Term Corporate Bond ETF (VCSH) iShares National Muni Bond ETF (MUB) JVP VIII, L.P. JVP X Funds Shares Nihon Computer Co., Ltd. Shares TEGNA Electronics Private Limited Shares Yu-Ji Venture Capital Co., Ltd. Brightek Optoelectronic Co., Ltd. United Industrial Gases Co., Ltd. Autotalks Ltd. - Preferred E. Share Warrants Autotalks Ltd. Allxon Inc. Shares Nyquest Technology Co., Ltd. Shares Symetrix Corporation
	Company Name	WECA WECJ GLMTD NTC SYI NTCJ

146 -

EndingBalance	Cost Amount	$ 2,848,160 555,000 1,710,869
	Number of Shares	247,527,493 55,500,000 45,619
Disposal	Gain (Loss) on Disposal	$ - - Share of profit (loss) 126,861 Cumulative transition differences 3,326 Unrealized profits and losses on transactions with associates (67,769)
	Carrying Amount (Note 3)	$ - - -
	Amount	$ - - -
	Number of Shares	- - -
Acquisition	Cost Amount	$ 765,825 555,000 358,772
	Number of Shares	25,527,493 55,500,000 30,919
Beginning Balance	Cost Amount	$ 2,082,335 - 1,289,679
	Number of Shares	222,000,000 - 14,700 (Note)
	Relationship	Investor that exercises significant influence over the Group Related party in substance Parent company
	Counterparty	Issuance of ordinary shares in cash Issuance of ordinary shares in cash TPSCo.
	Financial Statement Account	Current financial assets at FVTOCI Non-current financial assets at FVTOCI Investments accounted for using equity method
	Type and Name of Marketable Securities	Walsin Lihwa Corporation CHIA-HO Green Energy Corporation TPSCo.
	Company Name	WEC NTCJ

147 -

Other Terms	Other Terms	None None None None None
Purpose of Acquisition		Business purpose Business purpose Business purpose Business purpose Business purpose
Pricing Reference		Price comparison and price negotiation Price comparison and price negotiation Price comparison and price negotiation Price comparison and price negotiation Price comparison and price negotiation
Information on Previous Title Transfer If Counterparty is A Related Party	Amount	N/A N/A N/A N/A N/A
	Transaction Date	N/A N/A N/A N/A N/A
	Relationship	N/A N/A N/A N/A N/A
	Property Owner	N/A N/A N/A N/A N/A
Relationship		None None None None None
Counterparty		L&K Engineering Co., Ltd. Wholetech System Hitech Ltd. Jer Yih Electrical Co., Ltd. Mega Union Technology Incorporated Rayzher Industrial Co., Ltd.
Payment Term		Monthly settlement by the construction progress and acceptance Monthly settlement by the construction progress and acceptance Monthly settlement by the construction progress and acceptance Monthly settlement by the construction progress and acceptance Monthly settlement by the construction progress and acceptance
Transaction Amount		$ 425,823 638,728 454,092 331,348 341,842
Event Date		2022.01.23-2022.12.08 2022.01.23-2022.12.22 2022.01.23-2022.12.22 2022.06.16-2022.12.18 2022.01.23-2022.12.22
Property		Buildings Buildings Buildings Buildings Buildings
Company Name		WEC

148 -

Note	Note
Notes/Accounts Payable or Receivable	% to Total	12 10 - 3 - (100) (93) (7) (100) (95) 12 (10) (28) (5) 9 (1) 3 1 (100) (100)
	Ending Balance	$ 553,174 461,590 1,135 140,764 21,464 USD (18,013) JPY (1,994,248) JPY (142,480) RMB (257) USD (4,584) 141,110 (158,632) (448,177) (84,359) 108,679 (20,828) 33,052 15,704 USD (4,595) USD (3,539)
Abnormal Transaction	Payment Terms	N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
	Unit Price	N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Transaction Details	Payment Terms	Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 30 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 15 days end of the month Net 15 days end of the month Net 15 days end of the month Net 90 days from invoice date Net 30 days from invoice date Net 90 days from invoice date Net 45 days from invoice date Net 90 days from invoice date Net 90 days from invoice date
	% of Total	14 11 6 3 - 100 97 3 100 100 41 24 13 4 1 2 1 1 100 100
	Amount	$ 7,349,083 5,640,271 2,914,234 1,661,541 173,887 USD 249,304 JPY 24,946,747 JPY 659,811 RMB 662,557 USD 56,502 8,079,378 1,961,416 1,045,764 335,654 262,269 173,354 149,214 229,401 USD 271,014 USD 8,744
	Purchase/ Sale	Sales Sales Sales Sales Sales Purchases Purchases Purchases Purchases Purchases Sales Purchases Purchases Purchases Sales Purchases Sales Sales Purchases Purchases
Relationship		Direct subsidiary with 100% ownership Direct subsidiary with 100% ownership Indirect subsidiary with 100% ownership Indirect subsidiary with 100% ownership Direct subsidiary with 51% ownership Parent company Parent company Direct subsidiary with 51% ownership Parent company Parent company NTC’s direct subsidiary with 100% ownership NTC’s indirect subsidiary with 100% ownership Related party in substance NTC’s direct subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership Parent company Direct subsidiary with 100% ownership Related party in substance Parent company Parent company
Related Party		WEHK WECJ WECN WECA NTC WEC WEC NTC WEC WEC NTHK NTCJ Waltech Advanced Engineering (Suzhou) Ltd. NTSG NTCA WEC WECJ Nyquest Technology Co., Ltd. NTC NTC
Company Name		WEC WEHK WECJ WECN WECA NTC NTC NTC NTC NTC NTC NTC NTC NTHK NTCA

149 -

Note	Note
Notes/Accounts Payable or Receivable	% to Total	5 9 56 (25) 14 (71) (12) 21 2 62
	Ending Balance	USD 5,165 USD 2,741 USD 16,902 JPY (2,233,479) JPY 1,871,831 USD (14,165) JPY (1,087,101) JPY 2,864,430 USD 619 JPY 138,201
Abnormal Transaction	Payment Terms	N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
	Unit Price	N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Transaction Details	Payment Terms	Net 15 days end of the month Net 15 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month
	% of Total	8 3 45 37 26 69 39 13 3 50
	Amount	USD 65,019 USD 10,791 USD 141,550 JPY 19,356,022 JPY 26,308,826 USD 202,508 JPY 20,139,308 JPY 13,025,750 USD 7,786 JPY 1,305,035
	Purchase/ Sale	Sales Sales Sales Purchases Sales Purchases Purchases Sales Sales Sales
Relationship		Parent company Parent company NTC’s indirect subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership NTC’s indirect subsidiary with 100% ownership Associate Related party in substance Related party in substance Associate
Related Party		NTC NTC NTCJ NTSG NTSG NTCJ TPSCo. Waltech Advanced Engineering (Suzhou) Ltd. Waltech Advanced Engineering (Suzhou) Ltd. TPSCo.
Company Name		NTCJ NTSG NTCJ NTSG NTCJ NTSG AMTC

150 -

Allowance for Impairment Loss	Allowance for Impairment Loss	$ - - - - - - - - - -
Amount Received in Subsequent Period		$ 481,835 - - USD 1,571 141,110 108,679 USD 16,902 JPY 1,871,831 USD 5,165 JPY 2,864,430
Overdue	Action Taken	- - - - - - - - - -
	Amount	$ - - - - - - - - - -
	Turnover Rate	10.55 9.68 7.47 (Note) 91.16 3.49 9.69 14.11 17.08 4.91
	Ending Balance	$ 553,174 461,590 140,764 USD 5,591 141,110 108,679 USD 16,902 JPY 1,871,831 USD 5,165 JPY 2,864,430
	Relationship	Direct subsidiary with 100% ownership Direct subsidiary with 100% ownership Indirect subsidiary with 100% ownership Parent company NTC’s direct subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership NTC’s indirect subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership Direct subsidiary with 51% ownership Related party in substance
	Related Party	WEHK WECJ WECA WEC NTHK NTCA NTCJ NTSG NTC Waltech Advanced Engineering (Suzhou) Ltd.
	Company Name	WEC WECA NTC NTSG NTCJ

151 -

Note	Note	(Note 1) (Note 1) (Note 2) (Notes 3 and 4)
Share of Profit (Loss)		$ 2,161,530 30,439 129,338 69,921 51,954 101,815 (404) (17,185) 12,301 673 26 386,750 (1,316) 30,487 45,313 (192) USD (6) (524) - 66,834 (17,224) (17,278) 14,445 1,186 10,280 168,131 907 1,352,222 (16,951) (3,737) 1,352,086 91,737 126,861
Net Income (Loss) of the Investee		$ 4,220,773 30,439 129,345 69,921 51,954 147,128 (404) (17,185) 12,301 673 26 1,026,111 (5,630) 30,487 147,128 (192) USD (6) (524) - 66,834 (17,224) (17,278) 14,445 1,186 10,280 168,131 907 1,352,222 (16,951) (3,737) 1,352,086 91,737 493,050
As ofDecember 31, 2022	Carrying Amount	$ 8,941,174 2,067,211 581,154 234,733 185,332 312,463 132,048 95,763 87,383 25,717 2,929 7,996,268 264,303 2,097,702 - 30,362 USD 989 102,348 3,000 611,146 285,197 368,652 147,758 21,647 210,631 1,959,771 12,708 7,567,843 285,197 294,012 11,402,133 233,534 1,710,869
	%	51.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 38.00 30.00 100.00 - 100.00 99.99 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 49.00
	Number of Shares	214,954,635 87,960,000 71,150,000 4,000 5,343,000 2,970 4,470,000 40,000,000 100,000 850,000 780,000 182,840,999 24,000,000 3,067 - 1,000,000 27,998,400 300,000 107,400,000 8,897,789 17,960,000 3,850,000 600,000 60,500 45,100,000 125,000 100 - 1,000 9,480 4,000 45,619
Original Investment Amount	December 31, 2021	$ 4,436,920 2,758,517 278,158 167,660 168,755 - 155,663 156,292 21,242 28,679 2,967 1,874,825 30,000 1,683,207 112,644 30,895 USD 1,000 135,415 - 427,092 274,987 590,953 38,500 30,211 190,862 1,319,054 30,828 5,927,849 1,473,559 46,905 111,520 55,760 -
	December 31, 2022	$ 4,436,920 2,758,517 278,158 167,660 168,755 190,070 155,663 156,292 21,242 28,679 2,967 1,874,825 240,000 1,683,207 - 30,895 USD 1,000 135,415 3,000 427,092 274,987 590,953 38,500 30,211 190,862 1,319,054 30,828 5,927,849 1,473,559 46,905 111,520 55,760 1,648,451
Main Businesses and Products		Research, design, development, manufacture and marketing of Logic IC, 6 inch wafer product, test, and OEM Investment holding Sales of semiconductor and investment holding Software and hardware integration design of semiconductor Investment holding Research, development, sales and after-sales service of semiconductor Investment holding Electronic commerce and investment holding Design and service of semiconductor Marketing service of semiconductor Investment holding Investment holding Agriculture and forestry botanic conservation Design, sales and service of semiconductor Research, development, sales and after-sales service of semiconductor Electronic commerce and investment holding Sales and service of semiconductor Development of software and services for automotive and industrial control Sales of semiconductor Investment holding Investment holding Investment holding Design, sales and service of semiconductor Design, sales and service of semiconductor Design, sales and service of semiconductor Design, sales and service of semiconductor Investment holding Investment holding Design and service of semiconductor Design, sales and service of semiconductor Design and service of semiconductor Foundry and sales of semiconductor
Location		Taiwan British Virgin Islands Hong Kong Japan British Virgin Islands Japan Seychelles Hong Kong Israel Germany Hong Kong Taiwan Taiwan United States of America Japan Hong Kong India Taiwan Hong Kong British Virgin Islands British Virgin Islands Taiwan India United States of America Singapore Korea Japan United States of America Israel Japan Japan Japan
Investee Company		Nuvoton Technology Corporation Winbond International Corporation Winbond Electronics (HK) Limited Miraxia Edge Technology Corporation Landmark Group Holdings Ltd. Winbond Electronics Corporation Japan Great Target Development Ltd. Callisto Holding Limited Winbond Technology Ltd. Winbond Electronics Germany GmbH Pine Capital Investment Limited Chin Xin Investment Co., Ltd. Hwa Bao Botanic Conservation Corp. Winbond Electronics Corporation America Winbond Electronics Corporation Japan Callisto Technology Limited GLMTD Technology Private Limited Miraxia Technology Taiwan Corporation Nuvoton Electronics Technology (H.K.) Limited Marketplace Management Limited Nuvoton Investment Holding Ltd. Song Yong Investment Corporation Nuvoton Technology India Private Limited Nuvoton Technology Corporation America Nuvoton Technology Singapore Pte. Ltd. Nuvoton Technology Korea Limited Nuvoton Technology Holdings Japan Goldbond LLC Nuvoton Technology Israel Ltd. Nuvoton Technology Corporation Japan Atfields Manufacturing Technology Corporation Tower Partners Semiconductor Co., Ltd.
Investor Company		Winbond Electronics Corp. Winbond International Corporation Landmark Group Holdings Ltd. Callisto Holding Limited Great Target Development Ltd. Miraxia Edge Technology Corporation Nuvoton Technology Corporation Marketplace Management Limited Nuvoton Investment Holding Ltd. Nuvoton Technology Holdings Japan Nuvoton Technology Corporation Japan

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Information on any investee company in mainland China, main businesses and procedures, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, investment income or loss, carrying amount of the investment at the end of the period and repatriations	of investment income:	Accumulated Remittance of Funds Accumulated	Investor Company Investee Company Main Businesses and Products Paid-in Capital Method of Investment Outward Remittance for Investment from Taiwan as of January 1, Outward Remittance for Investment from Taiwan as of December 31, Net Income of the Investee % Ownership of Direct or Indirect Investment Investment Gain (Note 1) Carrying Amount as of December 31, 2022 Accumulated Repatriation of Investment Income as of December 31, 2022 Outward Inward	2022 2022	WEC Winbond Electronics (Suzhou) Design, development and $ 276,435 Through investing in WEHK in the third area, $ 276,435 $ - $ - $ 276,435 $ 38,278 100 $ 38,278 $ 419,622 $ 35,880	Limited marketing of VLSI integrated (USD 9,000) which then invested in the investee in (USD 9,000) (USD 9,000)	ICs Mainland China indirectly	NTC Nuvoton Electronics Technology Provide projects for sale in China 68,036 Through investing in MML in the third area in 68,036 - - 68,036 (16,630) 51 (8,516) 147,465 -	(Shanghai) Limited and repairing, testing, (USD 2,000) British Virgin Islands, which then invested in (USD 2,000) (USD 2,000)	consulting of software and the investee in Mainland China indirectly	equipment lease of	semiconductor	Winbond Electronics (Nanjing) Computer software service 16,429 Through investing in MML in the third area in 16,429 - - 16,429 - 51 - (1,556) -	Ltd. (except I.C. design) (USD 500) British Virgin Islands, which then invested in (USD 500) (USD 500) (Note 2)	the investee in Mainland China indirectly	Nuvoton Electronics Technology Computer software service 197,670 Through investing in NTHK in the third area, 197,670 - - 197,670 4,749 51 2,432 117,041 -	(Shenzhen) Limited (except I.C. design), wholesale (USD 6,000) which then invested in the investee in (USD 6,000) (USD 6,000)	business for computer, Mainland China indirectly	supplement and software	NTSH Song Zhi Electronics Technology Provide development of 8,688 Through investing in NTSH in the third area, - - - - (16) 51 (8) 4,203 -	(Suzhou) semiconductor and technology, (CNY 2,000) which then invested in the investee in (Note 3) (Note 3)	consult service and equipment (Note 3) Mainland China indirectly	leasing business	Note 1: Investment profit or loss for the year ended December 31, 2022 was recognized under the basis of the financial statements audited by the Company’s auditor.	Note 2: WENJ has a negative net book value as of December 31, 2022, which is reclassified to other non-current liabilities.	Note 3: NTSH directly injected the capital in Song Zhi Electronics Technology (Suzhou).	Information on any investee company in mainland China, main businesses and procedures, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, investment income or loss, carrying amount of the investment at the end of the period and repatriations	of investment income:	Company Accumulated Outward Remittance for Investment in Mainland China as of December 31, 2022 Investment Amounts Authorized by Investment Commission, MOEA Upper Limit on the Amount of Investment Stipulated by Investment Commission, MOEA (Note 4)	WEC $ 276,435 (USD9,000) $ 276,435 (USD9,000) $ 56,497,798	NTC 282,135 (USD8,500) 282,135 (USD8,500) 10,539,562	Note 4: Upper limit on the amount of 60% of the investee’s net book value.	Refer to Table 5 for significant transactions with the investee in mainland China directly and indirectly through investing in companies in the third area.	Handling endorsement, guarantee and collateral to the investee in Mainland China directly and indirectly through investing in companies in the third area: None.	Financing of funds to investee in mainland China directly and indirectly through investing in companies in the third area: None.	Other transactions with significant influence on profit or loss for the period or financial performance: None.	- 77 -
1.																											2.						3.	4.	5.	6.

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Percentage of Consolidated Total Gross Sales or Total Assets (%)	Percentage of Consolidated Total Gross Sales or Total Assets (%)	8 - 2 1 - - 6 - - - 3 -	-	9 - 1 - - - 2 - -	6 -	4 -	-
Transaction Details	Terms	- - - - - - - - - - - -	-	- - - - - - - - -	- -	- -	-
	Amount	$ 7,349,083 553,174 1,661,541 577,400 171,691 140,764 5,640,271 461,590 265,877 380,023 2,914,234 173,887	149,108	8,079,378 141,110 1,136,241 417,532 262,269 108,679 1,961,416 158,632 335,654	JPY 26,308,826 JPY 1,871,831	USD 141,550 USD 16,902	JPY 1,489,444
	Financial Statement Account	Operating revenue Accounts receivable due from related parties Operating revenue Operating expenses Other payables Accounts receivable due from related parties Operating revenue Accounts receivable due from related parties Operating expenses Operating expenses Operating revenue Operating revenue	Purchases of goods	Operating revenue Accounts receivable due from related parties Operating expenses Operating expenses Operating revenue Accounts receivable due from related parties Operating costs Accounts payable due to related parties Operating costs	Operating revenue Accounts receivable due from related parties	Operating revenue Accounts receivable due from related parties	Other operating revenue
Nature of Relationship		Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries	Transactions between subsidiaries	Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries Transactions between parent company and subsidiaries	Transactions between subsidiaries Transactions between subsidiaries	Transactions between subsidiaries Transactions between subsidiaries	Transactions between subsidiaries
Related Party		WEHK WEHK WECA WECA WECA WECA WECJ WECJ WECJ WTL WECN NTC	NTC	NTHK NTHK NTIL NTCA NTCA NTCA NTCJ NTCJ NTSG	NTSG NTSG	NTCJ NTCJ	NTCJ
Company Name		WEC	WECJ	NTC	NTCJ	NTSG	AMTC
No.		0	1	2	3	4	5

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TABLE 10

WINBOND ELECTRONICS CORPORATION AND SUBSIDIARIES

INFORMATION OF MAJOR SHAREHOLDERS DECEMBER 31, 2022

Name of Major Shareholder	Shares	Shares
	Number of Shares	Percentage of Ownership (%)
Walsin Lihwa Corporation Chin Xin Investment Co., Ltd.	883,848,423 240,003,072	22.20 6.03

Note 1: Table 10 is based on the information on the last business day of the quarter provided by the Taiwan Depository & Clearing Corporation (TDCC). The TDCC calculate the total number of ordinary shares and preferred shares held by shareholders who retain more than 5% of the Company’s share (including treasury shares) that have delivered without physical registration. The number of shares in the Company’s consolidated financial report and the actual number of shares delivered without physical registration may differ due to the different calculation basis.
Note 2: As per information above, if the shareholder delivers the shares to the trust, shares will be disclosed based on the trustee’s account. Additionally, according to the Securities and Exchange Act, internal stakeholder whom holds more than 10% of the Company’s share, which includes shares held by the stakeholder and parts delivered to the trust that have decision making rights, should be declared. For information regarding internal stakeholder declaration, please refer to the Market Observation Post System website of the Taiwan Stock Exchange Corporation.
79 - - 155 -

Winbond Electronics Corporation

Financial Statements for the Years Ended December 31, 2022 and 2021 and Independent Auditors’ Report

156 -
157 -

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 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.

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 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 Standards on Auditing of the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

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.
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.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
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.
2 - - 158 -
159 -

WINBOND ELECTRONICS CORPORATION

BALANCE SHEETS DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 4 and 6) Current financial assets at fair value through profit or loss (Notes 4 and 7) Current financial assets at fair value through other comprehensive income (Notes 4 and 8) Accounts receivable, net (Notes 4 and 9) Accounts receivable due from related parties, net (Note 26) Other receivables (Note 26) Inventories (Notes 4, 5 and 10) Other current assets Total current assets NON-CURRENT ASSETS Non-current financial assets at fair value through other comprehensive income (Notes 4 and 8) Investments accounted for using equity method (Notes 4 and 11) Property, plant and equipment (Notes 4 and 12) Right-of-use assets (Notes 4 and 13) Investment properties (Notes 4 and 14) Intangible assets (Notes 4 and 15) Deferred income tax assets (Notes 4 and 21) Other non-current assets (Notes 6 and 26) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 16) Notes payable Accounts payable Accounts payable due to related parties (Note 26) Payables on machinery and equipment Other payables (Note 26) Current tax liabilities (Notes 4 and 21) Lease liabilities - current (Notes 4 and 13) Long-term borrowings - current portion (Note 16) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Notes 4 and 17) Long-term borrowings (Notes 16 and 23) Lease liabilities - non-current (Notes 4 and 13) Net defined benefit liabilities - non-current (Notes 4 and 18) Other non-current liabilities (Note 26) Total non-current liabilities Total liabilities EQUITY (Note 19) Share capital Capital surplus Retained earnings Legal reserve Unappropriated earnings Exchange differences on translation of the financial statements of foreign operations Unrealized gains on financial assets measured at fair value through other comprehensive income Total equity TOTAL		2022		2021
		Amount % $ 8,684,164 6 48,712 - 14,587,832 9 3,588,202 2 1,179,039 1 256,731 - 13,044,368 8 861,614 1 42,250,662 27 579,064 - 20,926,478 14 87,575,274 56 1,562,419 1 275,254 - 18,158 - 810,000 1 2,009,285 1 113,755,932 73 $ 156,006,594 100 $ - - 102,011 - 2,691,742 2 462,039 - 3,382,521 2 5,423,560 4 1,386,821 1 87,383 - 3,100,000 2 75,372 - 16,711,449 11 9,968,462 7 32,849,502 21 1,541,922 1 379,105 - 393,158 - 45,132,149 29 61,843,598 40 39,800,002 25 7,785,918 5 3,434,165 2 28,780,952 19 (654,652) (1) 15,016,611 10 94,162,996 60 $ 156,006,594 100		Amount % $ 20,226,289 16 50,057 - 10,977,904 9 5,556,897 4 1,944,639 2 283,312 - 9,195,814 7 680,687 1 48,915,599 39 29,086 - 18,878,347 15 55,352,300 44 1,558,921 1 285,814 - 43,999 - 445,000 1 435,513 - 77,028,980 61 $ 125,944,579 100 $ 1,430,417 1 61,648 - 3,520,195 3 913,581 1 4,393,748 3 5,157,125 4 2,256,788 2 75,578 - 785,000 1 93,942 - 18,688,022 15 9,956,086 8 11,848,865 9 1,535,495 1 944,555 1 527,443 1 24,812,444 20 43,500,466 35 39,800,002 32 7,786,124 6 2,074,570 2 20,733,450 16 (861,389) (1) 12,911,356 10 82,444,113 65 $ 125,944,579 100

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

4 -
160 -

WINBOND ELECTRONICS CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 4 and 26) OPERATING COSTS (Notes 10 and 26) GROSS PROFIT OPERATING EXPENSES (Note 26) Selling expenses General and administrative expenses Research and development expenses Expected credit (gain) loss (Note 9) Total operating expenses INCOME FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES Interest income Dividend income (Note 26) Other income (Notes 23 and 26) Share of profit (loss) of subsidiaries and associates Gains (losses) on disposal of property, plant and equipment (Note 26) Gains (losses) on disposal of non-current held for sale assets Gains (losses) on foreign exchange (Note 29) Gains (losses) on financial instruments at fair value through profit or loss Interest expense (Notes 13, 23 and 26) Other expenses Gains (losses) on disposal of investments Impairment loss recognized on property, plant and equipment (Note 12) Total non-operating income and expenses INCOME BEFORE INCOME TAX INCOME TAX EXPENSE (Notes 4 and 21) NET INCOME		2022 Amount % $ 51,139,171 100 27,181,153 53 23,958,018 47 1,229,028 3 4,672,592 9 6,610,718 13 (39,000) - 12,473,338 25 11,484,680 22 59,527 - 551,906 1 164,340 - 2,925,842 6 53,438 - 36,181 - 809,964 2 (822,862) (2) (59,527) - (159,052) - - - (112,266) - 3,447,491 7 14,932,171 29 2,005,006 4 12,927,165 25		2021
				Amount % $ 57,532,802 100 32,775,614 57 24,757,188 43 1,200,719 2 2,756,183 5 6,088,149 10 34,000 - 10,079,051 17 14,678,137 26 25,480 - 336,520 - 87,948 - 1,985,911 3 41,973 - 30,371 - (109,015) - 48,733 - (136,158) - (165,769) - (436) - (782,949) (1) 1,362,609 2 16,040,746 28 2,446,103 4 13,594,643 24 (Continued)

5 - - 161 -

WINBOND ELECTRONICS CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME (LOSS) Components of other comprehensive income (loss) that will not be reclassified to profit or loss: Gains (losses) on remeasurement of defined benefit plans (Note 18) Unrealized gains (losses) from investments in equity instruments at fair value through other comprehensive income Share of other comprehensive income (loss) of subsidiaries and associates accounted for using equity method Components of other comprehensive income (loss) that will be reclassified to profit or loss: Exchange differences on translation of the financial statements of foreign operations Share of other comprehensive income (loss) of subsidiaries and associates accounted for using equity method Other comprehensive income (loss) TOTAL COMPREHENSIVE INCOME EARNINGS PER SHARE (Note 22) Basic Diluted		2022 Amount % $ 92,216 - 2,857,430 6 (384,459) (1) (43,322) - 250,059 1 2,771,924 6 $ 15,699,089 31 $ 3.25 $ 3.23		2021
				Amount % $ (51,661) - 2,176,120 4 2,646,694 4 (22,955) - (567,106) (1) 4,181,092 7 $ 17,775,735 31 $ 3.42 $ 3.41

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

(Concluded)

6 - - 162 -

						Total Equity	$ 65,449,119		-	(796,000)	(796,000)	13,594,643	4,181,092	17,775,735	15,259		-	82,444,113		-	(3,980,000)	(3,980,000)	12,927,165	2,771,924	15,699,089	8	(214)		-	$ 94,162,996
Other Equity	Unrealized Gains	(Losses) on Financial	Exchange Differences Assets Measured at	on Translation of the Fair Value Through	Financial Statements Other Comprehensive	of Foreign Operations Income	$ (271,328) $ 8,141,510		- -	- -	- -	- -	(590,061) 4,864,104	(590,061) 4,864,104	- -		- (94,258)	(861,389) 12,911,356		- -	- -	- -	- -	206,737 2,405,779	206,737 2,405,779	- -	- -		- (300,524)	$ (654,652) $ 15,016,611
				Retained Earnings	Unappropriated	Legal Reserve Earnings	$ 1,913,317 $ 8,094,753		161,253 (161,253)	- (796,000)	161,253 (957,253)	- 13,594,643	- (92,951)	- 13,501,692	- -		- 94,258	2,074,570 20,733,450		1,359,595 (1,359,595)	- (3,980,000)	1,359,595 (5,339,595)	- 12,927,165	- 159,408	- 13,086,573	- -	- -		- 300,524	$ 3,434,165 $ 28,780,952
						Capital Surplus	$ 7,770,865		-	-	-	-	-	-	15,259		-	7,786,124		-	-	-	-	-	-	8	(214)		-	$ 7,785,918
						Share Capital	$ 39,800,002		-	-	-	-	-	-	-		-	39,800,002		-	-	-	-	-	-	-	-		-	$ 39,800,002
							BALANCE AT JANUARY 1, 2021	Appropriation of 2020 earnings (Note 19)	Legal reserve appropriated	Cash dividends	Total appropriations	Net income for the year ended December 31, 2021	Other comprehensive income (loss) for the year ended December 31, 2021	Total comprehensive income (loss) for the year ended December 31, 2021	Changes in ownership interests in subsidiaries	Disposal of investments in equity instruments designated at fair value	through other comprehensive income (Note 19)	BALANCE AT DECEMBER 31, 2021	Appropriation of 2021 earnings (Note 19)	Legal reserve appropriated	Cash dividends	Total appropriations	Net income for the year ended December 31, 2022	Other comprehensive income (loss) for the year ended December 31, 2022	Total comprehensive income (loss) for the year ended December 31, 2022	Changes in ownership interests in subsidiaries	Changes in equity of associates accounted for using equity method	Disposal of investments in equity instruments designated at fair value	through other comprehensive income (Note 19)	BALANCE AT DECEMBER 31, 2022

163 -

WINBOND ELECTRONICS CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expense Amortization expense Expected credit (gain) loss recognized on accounts receivable (Gains) losses on financial assets and liabilities at fair value through profit or loss Interest expense Interest income Dividend income Share of (profit) loss of subsidiaries and associates (Gains) losses on disposal of investments (Gains) losses on disposal of property, plant and equipment (Gains) losses on disposal of non-current held for sale assets Impairment loss on property, plant and equipment Unrealized profit (loss) on the transactions with subsidiaries Carbon offset Gains on lease modification Changes in operating assets and liabilities (Increase) decrease in financial assets and liabilities at fair value through profit or loss (Increase) decrease in accounts receivable (Increase) decrease in accounts receivable due from related parties (Increase) decrease in other receivables (Increase) decrease in inventories (Increase) decrease in other current assets (Increase) decrease in other non-current assets Increase (decrease) in notes payable Increase (decrease) in accounts payable Increase (decrease) in accounts payable due to related parties Increase (decrease) in other payables Increase (decrease) in other current liabilities Increase (decrease) in other non-current liabilities Cash flows generated by (used in) operations Interest received Dividends received Interest paid Income taxes paid Net cash flows generated by (used in) operating activities	2022 $ 14,932,171 8,113,063 52,841 (39,000) 7,525 59,527 (59,527) (551,906) (2,925,842) - (53,438) (36,181) 112,266 (66,340) 174 - 45,778 2,007,695 765,600 30,252 (3,848,554) (180,927) (1,761,996) 40,363 (827,941) (451,542) 256,911 (18,570) (516,481) 15,085,921 58,914 1,718,099 (518,173) (3,243,031) 13,101,730	2021 $ 16,040,746 10,231,678 53,712 34,000 (11,677) 136,158 (25,480) (336,520) (1,985,911) 436 (41,973) (30,371) 782,949 93,720 - (15) - (1,762,452) (867,138) (56,187) (1,276,190) (204,647) - (124,081) 158,062 35,621 2,804,097 22,589 27,238 23,698,364 23,337 1,081,156 (374,197) (109,456) 24,319,204 (Continued)

8 - - 164 -

WINBOND ELECTRONICS CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of investments accounted for using equity method Acquisitions of financial assets at fair value through profit or loss Acquisitions of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Proceeds from capital reduction of investments accounted for using equity method Proceeds from disposal of non-current held for sale assets Acquisitions of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisitions of right-of-use assets (Increase) decrease in refundable deposits Acquisitions of intangible assets Acquisitions of investment properties Net cash flows generated by (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase (decrease) in short-term borrowings Proceeds from long-term borrowings Repayments of long-term borrowings Cash dividends paid Repayments of lease liabilities Net cash flows generated by (used in) financing activities NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	2022 $ (400,070) (51,958) (1,321,011) 18,535 - 55,200 (40,798,805) 53,660 (2,167) 167,545 (937) (572) (42,280,580) (1,430,417) 23,150,000 - (3,980,000) (102,858) 17,636,725 (11,542,125) 20,226,289 $ 8,684,164	2021 $ (357,898) - (10,000) - 16,116 279,897 (9,292,410) 61,082 - (81,309) (6,070) (2,712) (9,393,304) 1,430,417 4,931,600 (5,000,000) (796,000) (83,965) 482,052 15,407,952 4,818,337 $ 20,226,289

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

(Concluded)

9 - - 165 -

WINBOND ELECTRONICS CORPORATION

NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

1. GENERAL INFORMATION

The Company’s shares have been listed on the Taiwan Stock Exchange Corporation since October 18, 1995.

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

2. APPROVAL OF FINANCIAL STATEMENTS

The financial statements were approved by the board of directors on February 16, 2023.

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

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

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

b. The IFRSs endorsed by the FSC for application starting from 2023

The IFRSs endorsed by the FSC for application starting from 2023
New IFRSs Amendments to IAS 1 “Disclosure of Accounting Policies” Amendments to IAS 8 “Definition of Accounting Estimates” Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”	Effective Date Announced by IASB
	January 1, 2023 (Note 1) January 1, 2023 (Note 2) January 1, 2023 (Note 3)

Note 1: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.

Note 2: The amendments will be applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.
Note 3: Except for deferred taxes that were recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments were applied prospectively to transactions that occur on or after January 1, 2022.
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As of the date the financial statements were authorized for issue, the Company has assessed that the application of the above standards and interpretations will not have a material impact on the Company’s financial position and financial performance.

c. New IFRSs in issue but not yet endorsed and issued into effect by the FSC

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

Note 1: Unless stated otherwise, the above IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.
Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and leaseback transactions entered into after the date of initial application of IFRS 16.

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Statement of Compliance

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

Basis of Preparation

The financial statements have been prepared on the historical cost basis except for financial instruments and defined benefit liabilities which are measured at the present value of the defined benefit obligation less the fair value of plan assets. Historical cost is generally based on the fair value of the consideration given in exchange for assets.

The Company used equity method to account for its investment in subsidiaries and associates for the stand-alone financial statements. The amounts of the net profit, other comprehensive income and total equity in stand-alone financial statements are same with the amounts attributable to the owner of the Company in its consolidated financial statements since there is no difference in accounting treatment between stand-alone basis and consolidated basis.

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Classification of Current and Non-current Assets and Liabilities

Current assets include cash and cash equivalents and those assets held primarily for trading purposes or to be realized, sold or consumed within twelve months after the reporting period, unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. Current liabilities are obligations incurred for trading purposes or to be settled within twelve months after the reporting period and liabilities that the Company does not have an unconditional right to defer settlement for at least twelve months after the reporting period. Except as otherwise mentioned, assets and liabilities that are not classified as current are classified as non-current.

Foreign Currencies

In preparing the financial statements, transactions in currencies other than the entity’s functional currency are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Exchange differences on monetary items arising from settlement are recognized in profit or loss in the period they arise.

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

For the purposes of presenting the financial statements, the assets and liabilities of foreign operations (including subsidiaries and associates in other countries that use currencies which are different from the currency of the Company) are translated into New Taiwan dollars using exchange rate prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period. The exchange differences arising are recognized in other comprehensive income.

Cash Equivalents

Financial Instruments

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

a. Financial assets measurement category

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

1) Financial asset at FVTPL

2) Financial assets at amortized cost

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

a) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset, except for:

a) Purchased or originated credit-impaired financial assets, for which interest income is calculated by applying the credit-adjusted effective interest rate to the amortized cost of the financial asset; and
b) Financial assets that are not credit-impaired on purchase or origination but have subsequently become credit-impaired, for which interest income is calculated by applying the effective interest rate to the amortized cost of such financial assets in subsequent reporting periods.
3) Investments in equity instruments at FVTOCI

On initial recognition, the Company may make an irrevocable selection to designate investments in equity instruments as at FVOCI. Designation at FVOCI is not permitted if the equity investment is held for trading or if it is contingent consideration recognized by an acquirer in a business combination.

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

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b. Impairment of financial assets

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

The Company always recognizes lifetime Expected Credit Loss (ECL) on accounts receivable. On all other financial instruments, the Company recognizes lifetime ECL when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on the financial instrument has not increased significantly since initial recognition, the Company measures the loss allowance for that financial instrument at an amount equal to 12-month ECL.

The Company recognizes an impairment loss in profit or loss for all financial instruments with a corresponding adjustment to their carrying amounts through a loss allowance account.

c. Derecognition of financial assets

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

d. Equity instruments

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

Equity instruments issued by the Company are recognized at the proceeds received, net of direct issue costs.

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e. Financial liabilities

Financial liabilities are classified as at FVTPL when such financial liabilities are either held for trading or are designed as at FVTPL. Financial liabilities held for trading are stated at fair value, and any interest paid on such financial liabilities is recognized in finance costs; any remeasurement gains or losses on such financial liabilities are recognized in other gains or losses.

Other financial liabilities are measured at amortized cost using the effective interest method.

f. Derecognition of financial liabilities

The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss.

g. Derivative financial instruments

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

Derivatives are initially recognized at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship. When the fair value of derivative financial instruments is positive, the derivative is recognized as a financial asset; when the fair value of derivative financial instruments is negative, the derivative is recognized as a financial liability.

Inventories

Investments Accounted for Using Equity Method

Investment accounted for using equity method include investments in subsidiaries and associates.

a. Investment in subsidiaries

Subsidiaries are the entities controlled by the Company.

Under the equity method, the investment in a subsidiary is initially recognized at cost and the carrying amount is increased or decreased to recognize the Company’s share of the profit or loss and other comprehensive income of the subsidiary after the date of acquisition. Besides, the Company also recognizes the Company’s share of the change in other equity of the subsidiary.

Changes in the Company’s ownership interests in subsidiaries that do not result in the Company’s loss of control over the subsidiaries are accounted for as equity transactions. Any difference between the carrying amount of the investment and the fair value of the consideration paid or received is recognized directly in equity.

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

Profits and losses from downstream transactions with a subsidiary are eliminated in full. Profits and losses from upstream transactions with a subsidiary and sidestream transactions between subsidiaries are recognized in the Company’s financial statements only to the extent of interests in the subsidiary that are not related to the Company.

b. Investment in associates

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

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

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

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

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

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The Company discontinues the use of the equity method from the date on which its investment ceases to be an associate. Any retained investment is measured at fair value at that date and the fair value is regarded as its fair value on initial recognition as a financial asset. The difference between the previous carrying amount of the associate attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate. The Company accounts for all amounts previously recognized in other comprehensive income in relation to that associate on the same basis as would be required if that associate had directly disposed of the related assets or liabilities.

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

Property, Plant and Equipment

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

The Company’s property, plant and equipment with residual values were depreciated straight-line basis over the estimated useful life of the asset:

over the estimated useful life of the asset:
Buildings	10-50 years
Machinery and equipment	3-14 years
Other equipment	3-5 years

Investment Properties

Investment properties are properties held to earn rentals and/or for capital appreciation. Investment properties are measured initially at cost. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and accumulated impairment loss, and depreciated over 20 to 50 years useful lives after considered residual values, using the straight-line method. Any gain or loss arising on derecognition of the property is calculated as the difference between the net disposal proceeds and the carrying amount of the asset and is included in profit or loss in the period in which the property is derecognized.

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Intangible Assets

a. Intangible assets acquired separately

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

b. Derecognition of intangible assets

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

Impairment of Property, Plant and Equipment, Right-of-use Asset, Investment Properties, Intangible Assets

At the end of each reporting period, the Company reviews the carrying amounts of its property, plant and equipment, right-of-use asset, investment properties and intangible assets, to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss.

Non-current Assets Classified as Held for Sale

Non-current assets classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell. Recognition of depreciation of those assets would cease.

Provisions

Provisions are recognized when the Company has a present obligation as a result of a past event and at the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. For potential product risk, the Company accrues reserve for products guarantee based on commitment to specific customers.

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Revenue Recognition

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

Leases

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

a. The Company as lessor

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

When the Company subleases a right-of-use asset, the sublease is classified by reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset. However, if the head lease is a short-term lease that the Company, as a lessee, has accounted for applying recognition exemption, the sublease is classified as an operating lease.

b. The Company as lessee

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

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

Lease liabilities are initially measured at the present value of the lease payments, which comprise fixed payments, in-substance fixed payments, variable lease payments which depend on an index or a rate, residual value guarantees, the exercise price of a purchase option if the Company is reasonably certain to exercise that option, and payments of penalties for terminating a lease if the lease term reflects such termination, less any lease incentives receivable. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the Company uses the lessee’s incremental borrowing rate.

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Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in a lease term, a change in the amounts expected to be payable under a residual value guarantee, a change in the assessment of an option to purchase an underlying asset, or a change in future lease payments resulting from a change in an index or a rate used to determine those payments, the Company remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. For a lease modification that is not accounted for as a separate lease, the Company accounts for the remeasurement of the lease liability by (a) decreasing the carrying amount of the right-of-use asset of lease modifications that decreased the scope of the lease, and recognizing in profit or loss any gain or loss on the partial or full termination of the lease; (b) making a corresponding adjustment to the right-of-use asset of all other lease modifications. Lease liabilities are presented on a separate line in the balance sheets.

The Company negotiates with the lessor for rent concessions as a direct consequence of the Covid-19 to change the lease payments originally due by June 30, 2022, and there is no substantive change to other terms and conditions. The Company elects to apply the practical expedient to all of these rent concessions, and therefore, does not assess whether the rent concessions are lease modifications. Instead, the Company recognizes the reduction in lease payment in profit or loss in the period in which the events or conditions that trigger the concession occur, and makes a corresponding adjustment to the lease liability.

Variable lease payments that do not depend on an index or a rate are recognized as expenses in the periods in which they are incurred.

Borrowing Costs

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

Government Grants

Government grants are not recognized until there is reasonable assurance that the Company will comply with the conditions attached to them and that the grants will be received.

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

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

Government grants that take the form of a transfer of a non-monetary asset for the use of the entity are recognized and measured at the fair value of the non-monetary asset.

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Employee Benefits

a. Short-term employee benefits

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

b. Retirement benefits

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

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

Taxation

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

a. Current tax

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

b. Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and it is remeasured at the end of each reporting period and recognized to the extent that it has become probable that there will be future taxable profit.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except where the Company is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

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

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5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

The Company considers the possible impact of the recent development of the COVID-19 in the world and its economic environment implications when making its critical accounting estimates in cash flow projections, growth rate, discount rate, profitability, etc. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimates are revised if the revisions affect only that year or in the year of the revisions and future years if the revisions affect both current and future years.

The Company’s critical accounting judgments and key sources of estimation uncertainty is valuation of inventory. Net realizable value of inventory is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. The estimation of net realizable value is based on current market conditions and the historical experience from selling products of a similar nature. Changes in market conditions may have a material impact on the estimation of net realizable value.

6. CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS
Cash and deposits in banks Repurchase agreements collateralized by bonds		December 31
		2022 $ 6,974,164 1,710,000 $ 8,684,164	2021 $ 17,161,232 3,065,057 $ 20,226,289

The Company has time deposits pledged to secure land and building leases and customs tariff obligations which are reclassified to “other non-current assets”. The amounts were as follows:

Time deposits		December 31	December 31
		2022 $ 129,711	2021 $ 127,101

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

Financial assets at FVTPL-current Derivative financial assets Forward exchange contracts Non-derivative financial assets Domestic listed and emerging stocks		December	31
		2022 $ 4,279 44,433 $ 48,712	2021 $ 50,057 - $ 50,057

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At the date of balance sheet, the outstanding derivative foreign exchange contracts not under hedge accounting were as follows:

accounting were as follows:
			Contract Amount
	Currencies	Maturity Date	(In Thousands)
December 31, 2022
Sell forward exchange contracts	USD to NTD	2023.01.06-2023.03.17	USD214,500/NTD6,577,149
Buy forward exchange contracts	NTD to USD	2023.01.13-2023.02.17	NTD1,552,375/USD50,500
December 31, 2021
Sell forward exchange contracts	USD to NTD	2022.01.07-2022.03.04	USD268,000/NTD7,449,265
Sell forward exchange contracts	RMB to NTD	2022.01.14-2022.01.21	RMB75,000/NTD325,655
Buy forward exchange contracts	NTD to USD	2022.02.17-2022.02.25	NTD965,550/USD35,000

The Company entered into derivative financial instruments contracts to manage exposures to exchange rate fluctuations of foreign currency denominated assets and liabilities. The derivative financial instruments contracts entered into by the Company did not meet the criteria of hedge accounting; therefore, the Company did not apply hedge accounting treatment.

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Equity instruments at FVTOCI:

Domestic listed and emerging stocks Domestic unlisted stocks Current Non-current		December 31	December 31
		2022 $ 14,587,832 579,064 $ 15,166,896 $ 14,587,832 579,064 $ 15,166,896	2021 $ 10,977,904 29,086 $ 11,006,990 $ 10,977,904 29,086 $ 11,006,990

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

For the year ended December 31, 2022, the Company disposed partial shares for the investment position adjustment. The unrealized gain and loss on financial assets at fair value through other comprehensive income of NT$12,179 thousand were transferred to retained earnings, please refer to Note 19 to financial statements for related information. For the year ended December 31, 2021, the Company did not dispose the shares for the adjustment of the investment position.

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9. ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE
At amortized cost Gross carrying amount Less: Allowance for impairment loss		December 31
		2022 $ 3,664,202 (76,000) $ 3,588,202	2021 $ 5,671,897 (115,000) $ 5,556,897

The average credit period of sales of goods was 30 to 60 days. No interest was charged on accounts receivable. The Company adopted a policy of only dealing with entities that are rated the equivalent of investment grade or higher and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. Credit rating information is supplied by independent rating agencies where available and, if not available, the Company uses other publicly available financial information and its own trading records to rate its major customers. The Company’s exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties. Credit exposure is controlled by counterparty limits that are reviewed and approved annually.

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

The Company applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits the use of lifetime expected loss provision for all accounts receivable. The expected credit losses on accounts receivable are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor’s current financial position, adjusted for general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of conditions at the reporting date. The Company estimates expected credit losses based on past due days. As the Company’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished between the Company’s different customer base.

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

The following table details the loss allowance of accounts receivable based on the overdue aging ratio and individual customer evaluation method.

December 31, 2022

Expected credit loss rate Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost	Not Overdue 2% $ 3,485,544 (72,129) $ 3,413,415	Overdue under 30 Days 2% $ 174,934 (3,499) $ 171,435	Overdue 31-90 Days 10% $ 3,724 (372) $ 3,352	Overdue 91-180 Days Overdue Over 180 Days 20% 50% $ - $ - - - $ - $ -	Total $ 3,664,202 (76,000)
					$ 3,588,202

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December 31, 2021

Not Overdue Overdue under 30 Days Overdue 31-90 Days Overdue 91-180 Days Overdue Over 180 Days Expected credit loss rate 2% 2% 10% 20% 50% Gross carrying amount $ 5,464,287 $ 201,323 $ 6,287 $ - $ - Loss allowance (Lifetime ECL) (110,345) (4,026) (629) - - Amortized cost $ 5,353,942 $ 197,297 $ 5,658 $ - $ - The movements of loss allowance of accounts receivable were as follows: 2022 Balance at January 1 $ 115,000 $ Recognized (reversal of) impairment loss (39,000) Balance at December 31 $ 76,000 $	Not Overdue Overdue under 30 Days Overdue 31-90 Days Overdue 91-180 Days Overdue Over 180 Days Expected credit loss rate 2% 2% 10% 20% 50% Gross carrying amount $ 5,464,287 $ 201,323 $ 6,287 $ - $ - Loss allowance (Lifetime ECL) (110,345) (4,026) (629) - - Amortized cost $ 5,353,942 $ 197,297 $ 5,658 $ - $ - The movements of loss allowance of accounts receivable were as follows: 2022 Balance at January 1 $ 115,000 $ Recognized (reversal of) impairment loss (39,000) Balance at December 31 $ 76,000 $	Total $ 5,671,897 (115,000)
		$ 5,556,897
		2021 81,000 34,000 115,000
	$

10. INVENTORIES

INVENTORIES
Finished goods Work-in-process Raw materials and supplies Inventories in transit		December 31
		2022 $ 1,293,029 10,367,859 1,383,231 249 $ 13,044,368	2021 $ 1,847,501 6,656,812 691,445 56 $ 9,195,814

The detail of the operating costs related to inventories was as follows:

The operating cost of goods sold Unallocated production overhead Recognition of inventory write-downs (reversed) and scrap of inventories, etc. Operating costs		December 31	December 31
		2022 $ 24,440,083 2,291,982 449,088 $ 27,181,153	2021 $ 32,875,431 543,075 (642,892) $ 32,775,614

11. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

Investments in subsidiaries Investments in associates		December 31	December 31
		2022 $ 12,665,907 8,260,571 $ 20,926,478	2021 $ 10,591,884 8,286,463 $ 18,878,347

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a. Investments in subsidiaries

Name of Subsidiaries Listed companies Nuvoton Technology Corporation (“NTC”) Unlisted companies Winbond International Corporation (“WIC”) Winbond Electronics (H.K.) Limited (“WEHK”) Winbond Electronics Corporation Japan (“WECJ”) Miraxia Edge Technology Corporation (“METC”) Landmark Group Holdings Ltd. (“Landmark”) Great Target Development Ltd. (“GTD”) Callisto Holding Limited (“Callisto”) Winbond Technology Ltd. (“WTL”) Winbond Electronics Germany GmbH (“WEG”) Pine Capital Investment Limited (“PCI”)		December 31	December 31	December 31
		2022 Carrying Value Ownership Percentage $ 8,941,174 51% 2,067,211 100% 581,154 100% 312,463 100% 234,733 100% 185,332 100% 132,048 100% 95,763 100% 87,383 100% 25,717 100% 2,929 100% $ 12,665,907		2021
				Carrying Value Ownership Percentage $ 7,844,763 51% 1,666,124 100% 435,975 100% - - 168,518 100% 151,284 100% 132,662 100% 103,563 100% 62,301 100% 23,791 100% 2,903 100% $ 10,591,884

Refer to Table 7 for information of above subsidiaries’ company name, main business and products, and registered location.

1) The fair value of investment in subsidiaries for which there are published price quotations, based on closing price of those investments at the balance sheet date, are summarized as follows:

Name of Subsidiary NTC		December 31	December 31
		2022 $ 24,719,783	2021 $ 30,308,604

2) The Company acquired 100% ownership interest of METC from the sub-subsidiary NTCJ on November 1, 2021 and the transaction was a reorganization under common control. The Company has provided the financial information of the subsidiaries acquired in the consolidated financial statements. Such information is not provided in the standalone financial statements.
3) The Company acquired 100% ownership interest of WECJ from the subsidiary Landmark on November 30, 2022 and the transaction was a reorganization under common control. The Company has provided the financial information of the subsidiaries acquired in the consolidated financial statements. Such information is not provided in the standalone financial statements.
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4) For the years ended December 31, 2022 and 2021 the Company recognized shares of subsidiaries’ profit in the amounts of NT$2,540,408 thousand and NT$1,788,003 thousand, respectively.
b. Investments in associates
1) Aggregate information of associates that are not individually material

Associates that are not individually material Chin Xin Investment Co., Ltd. Hwa Bao Botanic Conservation Corp.		December 31	December 31
		2022 $ 7,996,268 264,303 $ 8,260,571	2021 $ 8,257,867 28,596 $ 8,286,463

As of December 31, 2022 and 2021, the Company held 182,841 thousand shares of Chin Xin Investment Co., Ltd. with a 38% ownership interest.

2) Aggregate information of associates that are not individually material

The Company’s share of: Profit from continuing operations for the year Other comprehensive income (loss) Total comprehensive income	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 385,434 (529,691) $ (144,257)	2021 $ 197,908 1,901,619 $ 2,099,527

The investments accounted for using equity method and the shares of profit or loss and other comprehensive income of those investments for the years ended December 31, 2022 and 2021 were based on the subsidiaries’ and associates’ financial statements audited by independent auditors.

12. PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT
Land Buildings Machinery and equipment Other equipment Construction in progress and equipment under installation		December 31
		2022 $ 1,049,445 8,134,135 23,695,491 1,230,745 53,465,458 $ 87,575,274	2021 $ 1,012,705 9,571,018 27,329,533 741,850 16,697,194 $ 55,352,300

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Cost Balance at January 1, 2022 Additions Disposals Reclassified Balance at December 31, 2022 Accumulated depreciation and impairment Balance at January 1, 2022 Depreciation expense Disposals Impairment loss Balance at December 31, 2022 Cost Balance at January 1, 2021 Additions Disposals Reclassified Balance at December 31, 2021 Accumulated depreciation and impairment Balance at January 1, 2021 Depreciation expense Disposals Impairment loss Balance at December 31, 2021	Land $ 1,012,705 36,740 - - $ 1,049,445 $ - - - - $ - $ 977,945 34,760 - - $ 1,012,705 $ - - - - $ -	Buildings $ 26,560,502 102,149 - 51,818 $ 26,714,469 $ 16,989,484 1,590,850 - - $ 18,580,334 $ 26,197,116 246,696 - 116,690 $ 26,560,502 $ 15,514,679 1,474,805 - - $ 16,989,484	Machinery and Equipment O $ 122,077,668 9,101,228 (1,388,709) (6,487,389) $ 123,302,798 $ 94,748,135 6,135,393 (1,388,487) 112,266 $ 99,607,307 $ 118,930,247 3,818,896 (771,690) 100,215 $ 122,077,668 $ 86,280,990 8,436,818 (752,622) 782,949 $ 94,748,135	ther Equipment Construction in Progress and Equipment under Installation $ 4,086,583 $ 16,697,194 749,421 30,326,169 (4,724) - (4,521) 6,442,095 $ 4,826,759 $ 53,465,458 $ 3,344,733 $ - 256,005 - (4,724) - - - $ 3,596,014 - $ 3,770,476 $ 9,466,347 320,930 7,450,872 (7,943) - 3,120 (220,025) $ 4,086,583 $ 16,697,194 $ 3,147,282 $ - 205,353 - (7,902) - - - $ 3,344,733 $ -	Total $ 170,434,652 40,315,707 (1,393,433) 2,003
					$ 209,358,929
					$ 115,082,352 7,982,248 (1,393,211) 112,266
					$ 121,783,655
					$ 159,342,131 11,872,154 (779,633) -
					$ 170,434,652
					$ 104,942,951 10,116,976 (760,524) 782,949
					$ 115,082,352

a. As of December 31, 2022 and 2021, the carrying amounts of NT$50,648,364 thousand and NT$9,507,995 thousand of property, plant and equipment were pledged to secure long-term borrowings and corporate bonds.
b. Information about capitalized interest

Information about capitalized interest
Capitalized interest amounts Capitalized interest rates	For the Year Ended December 31
	2022 2021 $ 528,129 $ 252,668 1.89%-1.92% 1.79%-1.89%

c. For the years ended December 31, 2022 and 2021 the Company recognized an impairment loss of NT$112,266 thousand and NT$782,949 thousand for certain machinery and equipment which will not be used in the future after evaluation, respectively.
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13. LEASE ARRANGEMENTS

a. Right-of-use assets

Carrying amounts Land Buildings Other equipment Additions to right-of-use assets Depreciation charge for right-of-use assets Land Buildings Other equipment		December 31	December 31	December 31
	2022 2021 $ 1,517,392 $ 1,544,632 31,676 4,454 13,351 9,835 $ 1,562,419 $ 1,558,921 For the Year Ended December 31
			2022 $ 123,273 $ 85,726 23,619 10,430 $ 119,775	2021 $ 13,306 $ 82,323 9,944 11,431 $ 103,698

b. Lease liabilities

Lease liabilities
Carrying amounts Current Non-current		December 31
		2022 $ 87,383 $ 1,541,922	2021 $ 75,578 $ 1,535,495

Range of discount rate for lease liabilities was as follows:

Land Buildings Other equipment	December 31
	2022 2021 2.37%-2.47% 2.47% 0.90%-1.60% 0.90%-1.60% 1.04%-1.86% 0.90%-1.86%

For the years ended December 31, 2022 and 2021, the interest expense under lease liabilities amounted to NT$39,502 thousand and NT$39,538 thousand, respectively.

c. Material lease-in activities and terms

The Company leased lands from Science Park Bureau, and the lease term will expire in 2023 and 2037, respectively, which can be extended after the expiration of the lease periods.

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d. Other lease information

Expenses relating to short-term leases Expenses relating to variable lease payments not included in the measurement of lease liabilities Total cash outflow for leases	For the Year Ended	For the Year Ended	December 31
		2022 $ 2,750 $ 6,929 $ 154,222	2021 $ 1,885 $ 13,569 $ 139,461

The Company leases certain building qualify as short-term leases and certain other equipment qualify as low-value lease. The Company has selected to apply the recognition exemption and thus, did not recognize right-of-use assets and lease liabilities for these leases.

14. INVESTMENT PROPERTIES

INVESTMENT PROPERTIES
Investment properties, net		December 31
		2022 $ 275,254	2021 $ 285,814

The Company has been subleasing its offices located in Hsinchu to its subsidiary, NTC, since November 2019, which was classified as operating lease with lease terms of 5 years and with an extension option. As of December 31, 2022, the fair value of such investment properties was approximately NT$417,675 thousand, which was referred by the neighborhood transactions.

Cost Balance at January 1 Additions Reclassified Balance at December 31 Accumulated depreciation and impairment Balance at January 1 Depreciation expense Balance at December 31		December 31	December 31
		2022 $ 305,053 572 (2,003) $ 303,622 $ 19,239 9,129 $ 28,368	2021 $ 302,341 2,712 - $ 305,053 $ 10,146 9,093 $ 19,239

15. INTANGIBLE ASSETS

INTANGIBLE ASSETS
Deferred technical assets, net Other intangible assets, net Carbon credits		December	31
		2022 $ 8,124 9,271 763 $ 18,158	2021 $ 16,248 27,751 - $ 43,999

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Cost Balance at January 1, 2022 Additions Carbon offset Reclassified Balance at December 31, 2022 Accumulated amortization and impairment Balance at January 1, 2022 Amortization expenses Balance at December 31, 2022 Cost Balance at January 1, 2021 Additions Balance at December 31, 2021 Accumulated amortization and impairment Balance at January 1, 2021 Amortization expenses Balance at December 31, 2021	Deferred Technical Assets $ 17,900,729 - - - $ 17,900,729 $ 17,884,481 8,124 $ 17,892,605 $ 17,900,729 - $ 17,900,729 $ 17,872,891 11,590 $ 17,884,481	Other Intangible Assets $ 41,741 - - (763) $ 40,978 $ 13,990 17,717 $ 31,707 $ 35,670 6,071 $ 41,741 $ 5,945 8,045 $ 13,990	Carbon Credits $ - 937 (174) - $ 763 $ - - $ - $ - - $ - $ - - $ -	Total $ 17,942,470 937 (174) (763) $ 17,942,470 $ 17,898,471 25,841 $ 17,924,312 $ 17,936,399 6,071 $ 17,942,470 $ 17,878,836 19,635 $ 17,898,471

The Company’s carbon credits were purchased from the CIX platform in Singapore, which was certified by third-party regarding forest carbon rights. The carbon credits will be used to offset carbon emission from fabs and employee transportation, etc. On November 3, 2022, the Company acquired the certificate which containing 1,000 tonnes of carbon credits from the platform, and offset 194 tonnes of carbon emissions on the Company’s Family Day.

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16. BORROWINGS

a. Short-term borrowings

b.	December 31 2022 2021 Interest Rate % Amount Interest Rate % Amount Bank lines of credit - $ - 0.30-0.48 $ 1,430,417 Long-term borrowings December 31 Period Interest Rate 2022 2021 Secured borrowings Bank of Taiwan syndicated loan (V) 2019.01.14-2026.09.19 2.43 % $ 31,000,000 $ 7,850,000 Unsecured borrowings Government grants (Note 23) 2020.12.28-2028.11.15 1.13%-1.33% 5,131,600 5,131,600 36,131,600 12,981,600 Less: Current portion (3,100,000) (785,000) Less: Syndication agreement management fee (47,250) (74,250) Less: Government loan discount (Note 23) (134,848) (273,485) $ 32,849,502 $ 11,848,865		December 31	December 31	December 31
		2022
					2022 $ 31,000,000 5,131,600 36,131,600 (3,100,000) (47,250) (134,848) $ 32,849,502		2021 $ 7,850,000 5,131,600 12,981,600 (785,000) (74,250) (273,485) $ 11,848,865

Bank of Taiwan Syndicated Loan (V)
1) On January 14, 2019, the Company entered into a syndicated loan, with a group of financial institutions, to procure equipment for fab. The credit line amounted to NT$42 billion. The principal will be repaid every six months from September 19, 2023 until maturity.
2) Refer to Note 12 to the financial statements for collateral of 12-inch building, fab facilities, machinery and equipment and related ancillary equipment on corporate bonds.
3) The Company is required to maintain certain financial covenants, including current ratio, debt ratio and total equity, on June 30 and December 31 during the tenors of the loans. Additionally, the principal and interest coverage should be also maintained on June 30 and December 31 during the tenors of the loans. The Company was in compliance with the agreed financial ratio requirements. The computations of financial ratios mentioned above are done based on the audited (reviewed) consolidated financial statements.

17. BONDS PAYABLE

BONDS PAYABLE
Domestic secured bonds Less: Discounts on bonds payable		December 31
		2022 $ 10,000,000 (31,538) $ 9,968,462	2021 $ 10,000,000 (43,914) $ 9,956,086

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On July 10, 2018, the Company was approved by the FSC to offer and issue the first secured corporate bonds of 2018, with an aggregate principal amount of NT$10 billion. The terms of issuance, amounts and interest rate as follows:

Issuance			Coupon
Date	Period	Amount	Rate	Repayment and Interest Payment
2018.07.17	7 years	$10 billion	1%	The principal will be repaid upon maturity. The interest
				is payable once a year at the coupon rate accrued
				annually on a simple basis starting from the issue date.

Refer to Note 12 to the financial statements for collateral of 12-inch Fab Manufacturing facilities on corporate bonds.

18. RETIREMENT BENEFIT PLANS

a. Defined contribution plan

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

b. Defined benefit plan

The defined benefit plan adopted by the Company in accordance with the Labor Standards Law is operated by the government. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the 6 months before retirement. The Company contributes amounts equal to 2% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee of the Company. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the Company assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Company is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the Company has no right to influence the investment policy and strategy.

The amount included in the balance sheet in respect of the Company’s obligation to its defined benefit plan was as follows:

plan was as follows:
Present value of the defined benefit obligation Fair value of the plan assets Net defined benefit liabilities, non-current		December 31
		2022 $ 1,440,800 (1,061,695) $ 379,105	2021 $ 1,522,597 (578,042) $ 944,555

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

Present Value
of the Defined
Benefit
Obligation
Fair Value of
the Plan Assets
Balance at January 1, 2022
$ 1,522,597
$ (578,042)
Service cost
Current service cost
23,368
-
Net interest expense (income)
12,028
(4,548)
Recognized in profit or loss
35,396
(4,548)
Remeasurement
Actuarial (gain) loss
- realized rate greater than the
discounted rate
-
(1,456)
- changes in financial assumptions
(125,498)
-
- changes in demographic assumptions
(28,724)
-
- experience adjustments
63,462
-
Recognized in other comprehensive income
(90,760)
(1,456)
Contributions from the employer
-
(504,082)
Benefits paid
(26,433)
26,433
Balance at December 31, 2022
$ 1,440,800
$ (1,061,695)
Balance at January 1, 2021
$ 1,525,037
$ (595,493)
Service cost
Current service cost
25,883
-
Net interest expense (income)
6,028
(2,346)
Recognized in profit or loss
31,911
(2,346)
Remeasurement
Actuarial (gain) loss
- realized rate greater than the
discounted rate
-
(8,116)
- changes in financial assumptions
(61,284)
-
- changes in demographic assumptions
41,795
-
- experience adjustments
79,266
-
Recognized in other comprehensive income
59,777
(8,116)
Contributions from the employer
-
(37,306)
Benefits paid
(65,219)
65,219
Settlements
(28,909)
-
Balance at December 31, 2021
$ 1,522,597
$ (578,042)

Net Defined
Benefit
Liabilities
(Assets)
$ 944,555
23,368
7,480
30,848
(1,456)
(125,498)
(28,724)
63,462
(92,216)
(504,082)
-
$ 379,105
$ 929,544
25,883
3,682
29,565
(8,116)
(61,284)
41,795
79,266
51,661
(37,306)
-
(28,909)
$ 944,555

Amounts recognized in profit or loss in respect of these defined benefit plans analyzed by function were as follows:

Operating costs Selling expenses General and administrative expenses Research and development expenses	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 12,491 1,906 6,536 9,915 $ 30,848	2021 $ 12,901 1,902 5,043 9,719 $ 29,565

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Through the defined benefit plans under the Labor Standards Law, the Company is exposed to the following risks:

1) Investment risk: The plan assets are invested in domestic/and foreign/equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.
2) Interest risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.
3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.

Discount rate Expected rates of salary increase	December 31
	2022 2021 1.90% 0.80% 1.00%-3.00% 1.00%-3.00%

Discount rate 0.5% increase 0.5% decrease Expected rates of salary increase/decrease 0.5% increase 0.5% decrease		December	31
		2022 $ (51,884) $ 55,012 $ 54,278 $ (51,716)	2021 $ (71,998) $ 77,146 $ 75,229 $ (70,991)

The expected contribution to the plan for the next year The average duration of defined benefit obligation		December	31
		2022 $ 19,802 7.5 years	2021 $ 19,088 10.1 years

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19. EQUITY

a. Share capital

Common stock

Common stock
Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued		December 31
		2022 6,700,000 $ 67,000,000 3,980,000 $ 39,800,002	2021 6,700,000 $ 67,000,000 3,980,000 $ 39,800,002

As of December 31, 2022 and 2021, the balance of the Company’s capital account amounted to NT$39,800,002 thousand, divided into 3,980,000 thousand common shares with a par value of NT$10.

b. Capital surplus

May be used to offset a deficit, distributed as cash dividends, or transferred to share capital Arising from issuance of share capital Arising from treasury share transactions Arising from conversion of bonds Arising from exercised employee share options Overdue employee stock options May only be used to offset a deficit Arising from changes in percentage of ownership interest in subsidiaries Arising from share of changes in capital surplus of associates		December 31	December 31
		2022 $ 4,787,673 2,342,036 136,352 208,451 30,749 251,734 28,923 $ 7,785,918	2021 $ 4,787,673 2,342,036 136,352 208,451 30,749 251,726 29,137 $ 7,786,124

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c. Retained earnings and dividend policy

According to the Company’s Articles of Incorporation, the Company’s dividend distribution policy is as follows:

However, if the Company has accumulated losses, the Company shall first set aside an amount for making up losses and then allocate remuneration of employees and remuneration of directors according to the percentage set forth in the preceding paragraph.

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The appropriations of earnings and cash dividends per share for 2021 and 2020 were as follows:

Legal reserve appropriated Cash dividends	Appropriation of Earnings For Year 2021 For Year 2020 $ 1,359,595 $ 161,253 3,980,000 796,000 $ 5,339,595 $ 957,253	Cash Dividends Per Share (NT$)
		For Year 2021 For Year 2020 $ 1.0 $ 0.2

The above cash dividends were resolved by the board of directors on March 15, 2022 and March 16, 2021, respectively; the other proposed appropriations were resolved by the shareholders meetings on May 31, 2022 and August 12, 2021, respectively.

As of the date of the Company’s board meeting (February 16, 2023), the appropriation of earnings for 2022 has not been finalized.

d. Other equity items

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

Balance at January 1 Exchange differences arising on translating the financial statements of foreign operations Share of exchange differences of subsidiaries and associates accounted for using equity method Balance at December 31	For the Year Ended	For the Year Ended	December 31
		2022 $ (861,389) (43,322) 250,059 $ (654,652)	2021 $ (271,328) (22,955) (567,106) $ (861,389)

The exchange differences arising on translation of foreign operation’s net assets from its functional currency to the Company’s presentation currency are recognized directly in other comprehensive income and also accumulated in the foreign currency translation reserve.

38 - - 194 -

2) Unrealized gains (losses) on financial assets at FVTOCI

Balance at January 1 Unrealized gains (losses) on revaluation of financial assets at FVTOCI Share of unrealized gains (losses) on revaluation of financial assets at FVTOCI of subsidiaries and associates accounted for using equity method Disposal of investments in equity instruments designated at FVTOCI of subsidiaries and associates accounted for using equity method Disposal of investments in equity instruments designated at FVTOCI Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 12,911,356 2,857,430 (451,651) (288,345) (12,179) $ 15,016,611	2021 $ 8,141,510 2,176,120 2,687,984 (94,258) - $ 12,911,356

20. EMPLOYEE BENEFITS EXPENSE, DEPRECIATION, AND AMORTIZATION

Short-term employee benefits Salary Insurance Board compensation Post-employment benefits Pension Depreciation Amortization Short-term employee benefits Salary Insurance Board compensation Post-employment benefits Pension Depreciation Amortization		For	the Year Ended December 31, 2022	the Year Ended December 31, 2022
		Classified as Operating Costs $ 3,063,946 $ 185,738 $ - $ 114,509 $ 7,377,599 $ - For	Classified as Operating Expenses Classified as Non-operating Income and Losses Total $ 4,991,257 $ - $ 8,055,203 $ 258,344 $ - $ 444,082 $ 162,940 $ - $ 162,940 $ 146,270 $ - $ 260,779 $ 724,424 $ 11,040 $ 8,113,063 $ 25,841 $ 27,000 $ 52,841 the Year Ended December 31, 2021
		Classified as Operating Costs $ 3,201,718 $ 158,572 $ - $ 106,604 $ 9,246,634 $ -	Classified as Operating Expenses Classified as Non-operating Income and Losses $ 4,338,035 $ - $ 176,911 $ - $ 173,929 $ - $ 115,800 $ - $ 974,041 $ 11,003 $ 19,635 $ 34,077	Total $ 7,539,753 $ 335,483 $ 173,929 $ 222,404 $ 10,231,678 $ 53,712

39 - - 195 -

There were 3,582 and 3,257 employees in the Company as of December 31, 2022 and 2021, respectively. There were 8 full time board directors as of December 31, 2022 and 2021.

As of December 31, 2022 and 2021, the average employee benefits and average salaries and wages were NT$2,451 thousand and NT$2,492 thousand, NT$2,254 thousand and NT$2,321 thousand, respectively. The average salaries and wages decrease 3%.

The Company has established the Audit Committee. There was neither supervisors nor remuneration to supervisors.

The remuneration policies of the Company were as follows:

a. Directors

b. Managers

c. Employees

For the years ended December 31, 2022 and 2021, the employees’ compensation and remuneration of directors were as follows:

directors were as follows:
Employees’ compensation Remuneration of directors	For the Year Ended December 31
	2022 Amounts Accrual Rate $ 307,880 2% $ 153,940 1%	2021
		Amounts Accrual Rate $ 330,737 2% $ 165,369 1%

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

40 - - 196 -

The compensation to employees and remuneration to the directors of 2021 and 2020 were approved by the Company’s board of directors on March 15, 2022 and March 16, 2021, respectively, were as below:

Employees’ compensation Remuneration of directors	For the Year Ended	For the Year Ended	December 31
		2021 $ 330,737 $ 165,369	2020 $ 27,831 $ 13,916

There was no difference between the actual amounts of employees’ compensation of and remuneration of directors paid and the amounts recognized in the financial statements for the years ended December 31, 2021 and 2020.

21. INCOME TAXES RELATING TO CONTINUING OPERATIONS

a. Income tax recognized in profit or loss

Major components of income tax expense were as follows:

Current income tax expense Current tax expense Adjustment for prior years Deferred income tax Change in current year Income tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 2,368,000 2,006 (365,000) $ 2,005,006	2021 $ 2,356,684 16,419 73,000 $ 2,446,103

Reconciliation of accounting profit and income tax expense were as follows:

Income tax expense from continuing operations at the statutory rate Tax effect of adjustment item Permanent differences Current income tax expense Loss carryforwards, investment credits and deductible temporary differences Adjustment for prior years’ income tax expense Tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 2,986,000 (782,000) 2,204,000 (201,000) 2,006 $ 2,005,006	2021 $ 3,208,000 (422,316) 2,785,684 (356,000) 16,419 $ 2,446,103

Based on the Income Tax Act in the ROC, the corporate income tax rate is 20%.

41 - - 197 -

b. Current tax assets and liabilities

b. Current tax assets and liabilities
Current income tax assets Income tax refund receivable (recorded as “other receivables”) Current income tax liabilities Income tax payable c. Deferred tax assets		December 31
		2022 $ 5,395 $ 1,386,821	2021 $ 2,337 $ 2,256,788

The movements of deferred tax assets were as follows:

For the year ended December 31, 2022

Deferred Tax Assets
Temporary differences
Idle capacity
Allowance for loss on inventories
Allowance for impairment loss
Others
For the year ended December 31, 2021
Deferred Tax Assets
Operating loss carryforwards
Temporary differences
Idle capacity
Allowance for impairment loss
Others

Opening
Balance
Recognized in
Profit or Loss
Closing Balance
$ 32,000
$ 312,000
$ 344,000
172,000
63,000
235,000
157,000
(37,000)
120,000
84,000
27,000
111,000
$ 445,000
$ 365,000
$ 810,000
Opening
Balance
Recognized in
Profit or Loss
Closing Balance
$ 109,000
$ (109,000)
$ -
307,000
(135,000)
172,000
-
157,000
157,000
102,000
14,000
116,000
$ 518,000
$ (73,000)
$ 445,000

d. Tax return assessments

The tax returns of the Company through 2020 have been assessed by the tax authorities.

42 - - 198 -

22. EARNINGS PER SHARE

	For the Year En	d December 31
2022	Earnings Per Share (NT$) Net Income $ 3.25 $ 3.23	2021
Amounts (Numerator) Shares (Denominator) Net Income (In Thousands) $ 12,927,165 3,980,000 - 17,642 $ 12,927,165 3,997,642		Amounts (Numerator) Shares (Denominator) Net Income (In Thousands) $ 13,594,643 3,980,000 - 9,930 $ 13,594,643 3,989,930	Earnings Per Share (NT$)
			Net Income $ 3.42 $ 3.41

If the Company offered to settle the compensation or bonuses paid to employees by cash or shares, the Company assumed that the entire amount of the compensation or bonuses will be settled in shares, and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share (EPS), if the shares have a dilutive effect. Such dilutive effect of the potential shares is included in the computation of diluted EPS until the number of shares to be distributed to employees is resolved in the following year.

23. GOVERNMENT GRANTS

24. CAPITAL MANAGEMENT

The Company’s capital management objective is to ensure it has the necessary financial resources and operational plan so that it can cope with the next twelve months working capital requirements, capital expenditures, research and development activities, debt repayments and dividends payments.

25. FINANCIAL INSTRUMENT

a. Fair value of financial instruments
1) Valuation techniques and assumptions used in fair value measurement

The fair values of financial assets and financial liabilities are determined as follows:

The fair values of financial assets and financial liabilities with standard terms and conditions and traded on active liquid markets are determined with reference to quoted market prices (includes publicly traded stock and mutual funds).
43 - - 199 -
The fair values of derivative foreign exchange contracts are measured using quoted middle and discount rates of foreign exchange contracts matching the foreign exchange rate on the maturity date of the contracts.
Domestic and overseas unlisted equity instrument at FVTOCI were all measured based on Level 3. Fair values of the above equity instruments were determined using discounted cash flow of income approach and comparable listed company approach, refer to strike price of similar business at active market, implied value multiple of the price and relevant information. Significant unobservable inputs included PE ratio, value multiple and market liquidity discount.
2) Fair value measurements recognized in the balance sheets

The fair value of financial instruments are grouped into Levels 1 to 3 based on the degree to observability of inputs.

Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
Level 3 inputs are unobservable inputs for an asset or liability.
3) Fair value of financial instruments that are not measured at fair value

Fair value hierarchy as at December 31, 2022

Fair value hierarchy as at December 31, 2022	Fair value hierarchy as at December 31, 2022
Carrying Amount Financial liabilities Financial liabilities measured at amortized cost Bonds payable (secured) $ 9,968,462 Fair value hierarchy as at December 31, 2021 Carrying Amount Financial liabilities Financial liabilities measured at amortized cost Bonds payable (secured) $ 9,956,086			Fair Value
		Level 1 $ -	Level 2 Level 3 $ 9,968,462 $ - Fair Value		Total $ 9,968,462
Financial liabilities Financial liabilities measured at amortized cost Bonds payable (secured)	Carrying Amount $ 9,956,086
		Level 1 $ -	Level 2 $ 9,956,086	Level 3 $ -	Total $ 9,956,086

44 - - 200 -

4) Fair value of financial instruments that are measured at fair value on a recurring basis

Fair value hierarchy as at December 31, 2022

Financial assets Financial assets at FVTPL Derivative financial assets Non-derivative financial assets Domestic listed and emerging securities Financial assets at FVTOCI Equity securities Domestic listed and emerging securities Domestic unlisted securities Fair value hierarchy as at December	Level 1 $ - 44,433 $ 44,433 $ 14,587,832 - $ 14,587,832 31, 2021 Level 1 $ - $ 10,977,904 - $ 10,977,904	Level 2 $ 4,279 - $ 4,279 $ - 22,560 $ 22,560 Level 2 $ 50,057 $ - 21,010 $ 21,010	Level 3 $ - - $ - $ - 556,504 $ 556,504 Level 3 $ - $ - 8,076 $ 8,076	Total $ 4,279 44,433
				$ 48,712
				$ 14,587,832 579,064
				$ 15,166,896
				Total $ 50,057
Financial assets Financial assets at FVTPL Derivative financial assets Financial assets at FVTOCI Equity securities Domestic listed and emerging securities Domestic unlisted securities
				$ 10,977,904 29,086
				$ 11,006,990

5) Reconciliation of Level 3 fair value measurements of financial instruments

The financial assets measured at Level 3 fair value were equity investments classified as financial assets at FVTOCI. Reconciliations for the years ended December 31, 2022 and 2021 were as follows:

Balance at January 1 Additions Recognized in other comprehensive income Balance at December 31	For the Year Ended	For the Year Ended	December 31
		2022 $ 8,076 555,000 (6,572) $ 556,504	2021 $ 107 10,000 (2,031) $ 8,076

45 - - 201 -
b. Categories of financial instruments

Fair values of financial assets and liabilities were summarized as follows:

Financial assets Measured at amortized cost Cash and cash equivalents Notes and accounts receivable (included related parties) Other receivables Refundable deposits (recorded in other non-current assets) Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income (current and non-current) Financial liabilities Measured at amortized cost Short-term borrowings Notes and accounts payable (included related parties) Payable on equipment and other payables Bonds payable Long-term borrowings (included current portion) Guarantee deposits (recorded in other non-current liabilities)	December 31	December 31
	2022 Carrying Amount Fair Value $ 8,684,164 $ 8,684,164 4,767,241 4,767,241 256,731 256,731 212,710 212,710 48,712 48,712 15,166,896 15,166,896 - - 3,255,792 3,255,792 8,806,081 8,806,081 9,968,462 9,968,462 35,949,502 35,949,502 1,810 1,810	2021
		Carrying Amount Fair Value $ 20,226,289 $ 20,226,289 7,501,536 7,501,536 283,312 283,312 380,255 380,255 50,057 50,057 11,006,990 11,006,990 1,430,417 1,430,417 4,495,424 4,495,424 9,550,873 9,550,873 9,956,086 9,956,086 12,633,865 12,633,865 1,810 1,810

c. Financial risk management objectives and policies

The Company’s Corporate Treasury function provides services to the business, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Company through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk, credit risk and liquidity risk.

The use of financial derivatives was governed by the Company’s policies approved by the board of directors, which provide written principles on foreign exchange risk, and use of financial derivatives. Compliance with policies and exposure limits was reviewed by the internal auditors on a continuous basis.

1) Market risk

The Company’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. The Company uses forward foreign exchange contracts to hedge the foreign currency risk on export.

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

46 - - 202 -

a) Foreign currency risk

The Company uses forward foreign exchange contracts to hedge the exchange rate risk within approved policy parameters utilizing forward foreign exchange contracts.

The sensitivity analysis included only outstanding foreign currency denominated monetary items and foreign exchange forward contracts designated as cash flow hedges, and adjusts their translation at the end of the year for a 1% change in foreign currency rates. For a 1% weakening of the New Taiwan dollar against the relevant currency, there would be an equal and opposite impact on post-tax profit and other equity. For a 1% depreciation of New Taiwan dollars against U.S. dollars, there would be impact on net income increase in the amounts of NT$60,201 thousand and NT$71,384 thousand for the years ended December 31, 2022 and 2021, respectively.

b) Interest rate risk

The Company’s interest rate risk arises primarily from floating rate borrowings.

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

end of the reporting period were as follows:
Cash flow interest rate risk Financial liabilities	December 31
	2022 2021 $ 36,131,600 $ 14,199,041

The sensitivity analyses below were determined based on the Company’s exposure to interest rates for fair value of variable-rate derivatives instruments at the end of the reporting period. If interest rates had been higher by 1%, the Company’s cash flows would increased by NT$361,316 thousand and NT$141,990 thousand for the years ended December 31, 2022 and 2021, respectively.

2) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company.

The Company adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. In order to minimize credit risk, the management of the Company has delegated a team responsible for determination of credit limits, credit approvals and other monitoring procedures to ensure that follow-up action is taken to recover overdue receivables. In addition, the Company reviews the recoverable amount of each individual accounts receivables at the end of the reporting period to ensure that adequate impairment losses are recognized for irrecoverable amounts. In this regard, the directors of the Company consider that the Company’s credit risk was significantly reduced.

47 - - 203 -

3) Liquidity risk

The Company has enough operating capital to comply with loan covenants; liquidity risk is low.

The Company’s non-derivative financial liabilities and their agreed repayment period were as follows:

Non-interest bearing Lease liabilities Variable interest rate liabilities Fixed interest rate liabilities		December 31, 2022	December 31, 2022
	Within 1 Year $ 12,061,873 124,925 3,100,000 - $ 15,286,798	1-2 Years $ 1,810 123,455 6,637,327 - $ 6,762,592	Over 2 Years $ - 1,753,894 26,394,273 10,000,000 $ 38,148,167	Total $ 12,063,683 2,002,274 36,131,600 10,000,000 $ 60,197,557

Additional information about the maturity analysis for lease liabilities:

Less than 2 Years 2-5 Years Lease liabilities $ 248,380 $ 346,692 Within 1 Year Non-interest bearing $ 14,046,296 Lease liabilities 114,444 Variable interest rate liabilities 2,002,441 Fixed interest rate liabilities 212,976 $ 16,376,157	Less than 2 Years 2-5 Years Lease liabilities $ 248,380 $ 346,692 Within 1 Year Non-interest bearing $ 14,046,296 Lease liabilities 114,444 Variable interest rate liabilities 2,002,441 Fixed interest rate liabilities 212,976 $ 16,376,157	2-5 Years $ 346,692		5-10 Years 10-15 Years $ 548,748 $ 548,748 December 31, 2021	5-10 Years 10-15 Years $ 548,748 $ 548,748 December 31, 2021		Over 15 Years $ 309,706

	Within 1 Year $ 14,046,296 114,444 2,002,441 212,976 $ 16,376,157		1-2 Years $ 1,810 108,298 1,570,000 - $ 1,680,108		Over 2 Years $ - 1,789,192 10,626,600 10,000,000 $ 22,415,792	Total $ 14,048,106 2,011,934 14,199,041 10,212,976 $ 40,472,057

Additional information about the maturity analysis for lease liabilities:

Lease liabilities	Less than 2 Years $ 222,742	2-5 Years $ 320,784	5-10 Years 10-15 Years $ 528,984 $ 528,890	Over 15 Years $ 410,534

26. RELATED PARTY TRANSACTIONS

a. The names and relationships of related parties are as follows:

Related Party Walsin Lihwa Corporation WEHK WEG WTL Callisto	Relationship with the Company
	Investor that exercises significant influence over the Company Subsidiary Subsidiary Subsidiary Subsidiary (Continued)

48 - - 204 -

Related Party
Winbond Electronics (Suzhou) Limited (“WECN”)
Winbond Electronics Corporation America (“WECA”)
WECJ
Landmark
NTC
METC
Nuvoton Technology Corporation Japan (“NTCJ”)
Hwa Bao Botanic Conservation Corp.
Chin Xin Investment Co., Ltd.
Walton Advanced Engineering Inc.
Walton Advanced Engineering Ltd. (Suzhou)
Walsin Technology Corporation
Hannstar Display Corporation
CHIA-HO Green Energy Corporation
Taiwan Cement Corporation

Relationship with the Company

Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Sub-subsidiary
Associate
Associate
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance
Related party in substance
(Concluded)

b. Operating activities For the Year Ended December 31 2022 2021 1) Operating revenue Subsidiaries WEHK $ 7,349,083 $ 9,936,348 WECJ 5,640,271 5,884,031 WECN 2,914,234 4,022,285 Others 1,835,428 1,979,585 Sub-subsidiary 15,549 4,186 Related party in substance 294 114 $ 17,754,859 $ 21,826,549 Price and terms were determined in accordance with mutual agreements. For the Year Ended December 31 2022 2021 2) Manufacturing expenses Related party in substance Walton Advanced Engineering Inc. $ 2,942,876 $ 3,244,368 Others 469,952 570,694 $ 3,412,828 $ 3,815,062	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 2,942,876 469,952 $ 3,412,828	2021 $ 3,244,368 570,694 $ 3,815,062

49 - - 205 -

3) Selling expenses Subsidiaries WECA Others Related party in substance 4) General and administrative expenses Investor that exercises significant influence over the Company Subsidiaries Related party in substance 5) Research and development expenses Subsidiaries 6) Dividend income Investor that exercises significant influence over the Company Walsin Lihwa Corporation Related party in substance HannStar Display Corporation Walsin Technology Corporation Others 7) Other income Subsidiaries NTC Associate Related party in substance	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2022 $ 254,693 68,199 363 $ 323,255 $ 14,078 3,779 675 $ 18,532 $ 912,513 $ 355,200 149,330 38,780 6,508 $ 549,818 $ 48,613 71 328 $ 49,012	2021 $ 229,478 73,887 335 $ 303,700 $ 13,788 3,977 - $ 17,765 $ 853,873 $ 199,800 75,000 51,707 10,013 $ 336,520 $ 26,282 64 971 $ 27,317

50 - - 206 -

8) Accounts receivable Subsidiaries WEHK WECJ WECA Others 9) Accounts payable Related party in substance Walton Advanced Engineering Inc. Others 10) Other receivables and other current assets Subsidiaries Related party in substance 11) Other payables Subsidiaries Related party in substance Investor that exercises significant influence over the Company 12) Refundable deposits (recorded in “other non-current assets”) Subsidiaries Investor that exercises significant influence over the Company 13) Guarantee deposits (recorded in “other non-current liabilities”) Subsidiaries		December 31	December 31
		2022 $ 553,174 461,590 140,764 23,511 $ 1,179,039 $ 376,135 85,904 $ 462,039 $ 52,073 1,653 $ 53,726 $ 263,149 17,723 - $ 280,872 $ 545 203 $ 748 $ 1,780	2021 $ 840,586 703,787 303,816 96,450 $ 1,944,639 $ 814,340 99,241 $ 913,581 $ 21,817 154 $ 21,971 $ 207,530 31,922 4 $ 239,456 $ 545 203 $ 748 $ 1,780

The Company’s transactions with the related party were conducted under normal terms.

51 - - 207 -

c. Disposal of property, plant and equipment

Associate Hwa Bao Botanic Conservation Corp. Related party in substance		Disposal Price	Disposal Price		Gain (Loss) on Disposal	Gain (Loss) on Disposal
		For the Year Ended December 31			For the Year Ended December 31
		2022 $ 55,200 68 $ 55,268	2021 $ - 479 $ 479		2022 $ 36,181 68 $ 36,249	2021 $ - 479 $ 479

The price of above transaction were determined based on the original acquisition cost of the machinery and equipment and reference to the recent quoted market price.

d. Lease arrangements - the Company is lessee

For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2022 2021 $ 1,033 $ - - 197 - 1,350 $ 1,033 $ 1,547 December 31
2022 2021 $ 5,845 $ - - 3,867 - 678 $ 5,845 $ 4,545 For the Year Ended December 31
	2022 $ 89 28 3 $ 120	2021 $ 19 91 9 $ 119

52 - - 208 -
e. Lease arrangements - the Company is lessor/sublease arrangements

Refer to Note 14 to the financial statement.

f. Acquisition of shares

For the year ended December 31, 2022

Related Party		Number of
Category/Name	Line Item	Shares	Underlying Assets	Purchase Price
Investor that exercises
significant influence over
the Group
Walsin Lihwa Corporation	Current financial	25,527,493	Ordinary shares of	$	765,825
	assets at FVTOCI		Walsin Lihwa
			Corporation
Related party in substance
CHIA-HO Green Energy	Non-current	55,500,000	Ordinary shares of		555,000
Corporation	financial assets at		CHIA-HO Green
	FVTOCI		Energy Corporation
Associate
Hwa Bao Botanic	Investments	21,000	Ordinary shares of		210,000
Conservation Corp.	accounted for		Hwa Bao Botanic
	using equity		Conservation
	method		Corp.
Subsidiaries
Landmark	Investments	2,970	Shares of WECJ		190,070
	accounted for
	using equity
	method
				$	1,720,895

For the year ended December 31, 2021

Related Party		Number of	Underlying
Category/Name	Line Item	Shares	Assets	Purchase Price
Sub-subsidiary
NTCJ	Investments accounted for	4,000 shares	Shares of METC	$ 357,898
	using equity method

g. Endorsements and guarantees

Endorsements and guarantees provided by the Group

Related Party Category/Name Sub-subsidiary Amount endorsed Amount utilized		December 31	December 31
		2022 $ 6,972,000 $ 952,840	2021 $ 11,080,076 $ -

53 - - 209 -
h. Compensation of key management personnel

Compensation of key management personnel
Short-term employment benefits Post-employment benefits	For the Year Ended December 31
		2022 $ 510,698 689 $ 511,387	2021 $ 334,753 18,154 $ 352,907

The remuneration of directors and key management personnel was determined by the remuneration committee having regard to the performance of individuals and market trends. And the remuneration was resolved by the board of directors.

27. PLEDGED AND COLLATERALIZED ASSETS

Refer to Notes 6 and 12 to the financial statements.

28. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

a. Amounts available under unused letters of credit as of December 31, 2022 and 2021 were approximately US$3,957 thousand and US$75,493 thousand, JPY321,200 thousand and JPY310,190 thousand and EUR0 thousand and EUR550 thousand, respectively.
b. The Company’s unrecognized commitments were as follows:

Acquisition of property, plant and equipment	December 31, 2022 $ 23,102,440

29. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The following information was aggregated by the foreign currencies other than functional currencies of the Company and the exchange rates between foreign currencies and respective functional currencies were disclosed.

The significant assets and liabilities denominated in foreign currencies were as follows:

Financial assets Monetary items USD EUR JPY RMB	December 31	December 31
	2022 Foreign Currencies (In Thousands) Exchange Rate New Taiwan Dollars (In Thousands) $ 265,826 30.71 $ 8,163,510 1,483 32.72 48,517 3,433,010 0.2324 797,831 10,647 4.408 46,934	2021
		Foreign Currencies (In Thousands) Exchange Rate New Taiwan Dollars (In Thousands) $ 356,115 27.68 $ 9,857,260 1,202 31.32 37,645 1,850,370 0.2405 445,014 124,519 4.344 540,912 (Continued)

54 - - 210 -

Non-monetary items USD EUR JPY ILS Financial liabilities Monetary items USD EUR JPY ILS	December 31	December 31
	2022 Foreign Currencies (In Thousands) Exchange Rate New Taiwan Dollars (In Thousands) $ 22,042 30.71 $ 676,914 786 32.72 25,717 985,033 0.2324 228,922 10,009 8.7301 87,382 69,795 30.71 2,143,412 3,365 32.72 110,094 3,559,564 0.2324 827,243 3,514 8.7301 30,675	2021
		Foreign Currencies (In Thousands) Exchange Rate New Taiwan Dollars (In Thousands) $ 19,492 27.68 $ 539,527 760 31.32 23,791 700,608 0.2405 168,518 7,007 8.8912 62,301 98,224 27.68 2,718,845 48,935 31.32 1,532,653 2,704,144 0.2405 650,347 2,098 8.8912 18,654 (Concluded)

The significant realized and unrealized foreign exchange gains (losses) were as follows:

Foreign Currencies USD JPY RMB	For the Year Ended	For the Year Ended	December 31
		2022 $ 591,600 183,009 26,157 $ 800,766	2021 $ (131,846) 6,961 14,699 $ (117,147)

30. ADDITIONAL DISCLOSURE

a. Following are the additional disclosures for material transactions for the Company:

1)	Financings provided	None
2)	Endorsements/guarantees provided	Table1
3)	Marketable securities held (excluding investments in subsidiaries and associates)	Table 2
4)	Marketable securities acquired and disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital	Table 3
5)	Acquisition of individual real estate properties at costs of at least NT$300 million or 20% of the paid-in capital	Table 4
6)	Disposal of individual real estate properties at prices of at least NT$300 million or 20% of the paid-in capital	None
7)	Total purchases from or sales to related parties of at least NT$100 million or 20% of the paid-in capital	Table 5
8)	Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital	Table 6
9)	Informationabout the derivativefinancial instruments transaction	Note 7

b. Information on investments: Refer to Table 7 attached.

55 - - 211 -
c. Information on investment in mainland China

1)	The name of the investee in mainland China, the main businesses and products, its issued capital, method of investment, information on inflow or outflow of capital, percentage of ownership, income (losses) of the investee, share of profits (losses) of investee, ending balance, amount received as dividends from the investee, and the limitationon investee.	Table 8
2)	Significant direct or indirect transactions with the investee, its prices and terms of payment, unrealized gain or loss, and other related information which is helpful to understand the impact of investment in mainland China on financial reports. a) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period. b) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period. c) The amount of property transactions and the amount of the resultant gains or losses. d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes. e) The highest balance, the ending balance, the interest rate range, and total current period interest with respect to the financing of funds. f) Other transactions that have a material effect on the profit or loss for the year or on the financial position, such as the rendering or receipt of services.	Table 8

d. Information on major shareholders: Refer to Table 9 attached.

31. SEGMENT INFORMATION

The Company has provided the financial information of the operating segments in the consolidated financial statements. These parent company only financial statements do not provide such information.

56 - - 212 -

Note	Note
Endorsement/ Guarantee Given on Behalf of Companies in Mainland China		N N
Endorsement/ Guarantee Given by Subsidiaries on Behalf of Parent		N N
Endorsement/ Guarantee Given by Parent on Behalf of Subsidiaries		Y Y
Aggregate Endorsement/ Guarantee Limit		$ 47,081,498 (Note 5) 17,565,938 (Note 6)
Ratio of Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements (%)		7.40 11.85
	Amount Endorsed/ Guaranteed by Collateral	$ - -
	Actual Borrowing Amount	$ 952,840 (JPY 4,100,000) 659,040 (JPY 287,980) and (USD 19,281)
	Outstanding Endorsement/ Guarantee at the End of the Period	$ 6,972,000 (JPY 30,000,000) (Note 3) 2,080,810 (JPY 5,650,000) and (USD 25,000) (Note 4)
	Maximum Amount Endorsed/ Guaranteed During the Period	$ 10,706,900 (JPY 46,071,000) (Note 3) 2,080,810 (JPY 5,650,000) and (USD 25,000) (Note 4)
	Limit on Endorsement/ Guarantee Given on Behalf of Each Party	$ 17,103,199 (Note 1) 17,565,938 (Note 2)
Endorsee/Guarantee	Relationship	NTC’s indirect subsidiary with 100% ownership Subsidiary
	Name	NTCJ NTCJ
	Endorser/Guarantor	WEC NTC
	No.	0 1

213 -

	Note
December 31, 2022	Fair Value	$ 11,683,298 1,672,502 663,609 568,211 212 12,450 10,110 7,671 124 - 548,709 10,993 3,679 29,761
	Percentage of Ownership (%)	7 5 2 10 - - - 10 5 16 15 - - -
	Carrying Amount	$ 11,683,298 1,672,502 663,609 568,211 212 12,450 10,110 7,671 124 - 548,709 10,993 3,679 29,761
	Shares/Units	247,527,493 150,000,210 8,400,117 50,062,641 5,305 3 1 1,000,000 5,440 4,000,000 55,500,000 182,000 65,000 829,000
	Financial Statement Account	Current financial assets at fair value through other comprehensive income ″ ″ ″ ″ Non-current financial assets at fair value through other comprehensive income ″ ″ ″ ″ ″ Current financial assets at fair value through profit or loss ″ ″
	Relationship with the Holding Company	The investee’s chairman are relatives within the second degree of relationship of WEC’s chairman. As WEC’s corporate director, the investee held 22.20% ownership interest in WEC. The investee’s chairman are relatives within the second degree of relationship of WEC’s chairman. The investee’s chairman are relatives within the second degree of relationship of WEC’s chairman. The investee’s chairman are relatives within the second degree of relationship of WEC’s chairman. WEC as the investee’s director. None None None WEC as the investee’s director WEC as the investee’s supervisor None WEC’s chairman as an independent director of the investee’s parent company None None None
	Type and Name of Marketable Securities	Shares Walsin Lihwa Corporation Hannstar Display Corporation Walsin Technology Corporation Walton Advanced Engineering Inc. Cathay Financial Holdings Co., Ltd. Shares Hsin Chu Golf Country Club Linkou Golf Course Corporation Intellectual Property Innovation Corporation Harbinger III Venture Capital Corp. Smart Catch International Co., Ltd. CHIA-HO Green Energy Corporation Preferred stocks Fubon Financial Holding Co., Ltd. Preferred Shares B (2881A) Cathay Financial Holding Co., Ltd. Preferred Stock B (2882A) Shin Kong Financial Holding Co., Ltd. Preferred Shares B (2888B)
	Company Name	WEC

214 -

	Note
December 31, 2022	Fair Value	USD 2,000 USD 1,804 USD 1,794 USD 25,191 USD 14,922 JPY - INR 30,010 9,844 919 492,800 614,200 76,775 45,000 116,985 -
	Percentage of Ownership (%)	1 - - 7 4 1 10 5 - 4 9 - - 5 1
	Carrying Amount	USD 2,000 USD 1,804 USD 1,794 USD 25,191 USD 14,922 JPY - INR 30,010 9,844 919 492,800 614,200 76,775 45,000 116,985 -
	Shares/Units	377,808 24,000 17,000 - - 10 3,001,000 575,000 34,680 8,800,000 3,932,816 - - 1,650,000 50,268
	Financial Statement Account	Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss ″ Non-current financial assets at fair value through other comprehensive income ″ Non-current financial assets at fair value through other comprehensive income Non-current financial assets at fair value through other comprehensive income Non-current financial assets at fair value through other comprehensive income ″ ″ ″ Non-current financial assets at fair value through profit or loss ″ Non-current financial assets at fair value through other comprehensive income Non-current financial assets at fair value through other comprehensive income
	Relationship with the Holding Company	None None None None None None The held company as the investee’s director The held company as the investee’s director None The held company as the investee’s director None None None The held company as the investee’s director None
	Type and Name of Marketable Securities	Shares Kneron Holding Company Funds Vanguard Short-Term Corporate Bond ETF (VCSH) iShares National Muni Bond ETF (MUB) JVP VIII, L.P. JVP X Funds Shares Nihon Computer Co., Ltd. Shares TEGNA Electronics Private Limited Shares Yu-Ji Venture Capital Co., Ltd. Brightek Optoelectronic Co., Ltd. United Industrial Gases Co., Ltd. Autotalks Ltd. - Preferred E. Share Warrants Autotalks Ltd. Allxon Inc. Shares Nyquest Technology Co., Ltd. Shares Symetrix Corporation
	Company Name	WECA WECJ GLMTD NTC SYI NTCJ

215 -

EndingBalance	Cost Amount	$ 2,848,160 555,000 1,710,869
	Number of Shares	247,527,493 55,500,000 45,619
Disposal	Gain (Loss) on Disposal	$ - - Share of profit (loss) 126,861 Cumulative transition differences 3,326 Unrealized profits and losses on transactions with associates (67,769)
	Carrying Amount (Note 3)	$ - - -
	Amount	$ - - -
	Number of Shares	- - -
Acquisition	Cost Amount	$ 765,825 555,000 358,772
	Number of Shares	25,527,493 55,500,000 30,919
Beginning Balance	Cost Amount	$ 2,082,335 - 1,289,679
	Number of Shares	222,000,000 - 14,700 (Note)
	Relationship	Investor that exercises significant influence over the Group Related party in substance Parent company
	Counterparty	Issuance of ordinary shares in cash Issuance of ordinary shares in cash TPSCo.
	Financial Statement Account	Current financial assets at FVTOCI Non-current financial assets at FVTOCI Investments accounted for using equity method
	Type and Name of Marketable Securities	Walsin Lihwa Corporation CHIA-HO Green Energy Corporation TPSCo.
	Company Name	WEC NTCJ

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Other Terms	Other Terms	None None None None None
Purpose of Acquisition		Business purpose Business purpose Business purpose Business purpose Business purpose
Pricing Reference		Price comparison and price negotiation Price comparison and price negotiation Price comparison and price negotiation Price comparison and price negotiation Price comparison and price negotiation
Information on Previous Title Transfer If Counterparty is A Related Party	Amount	N/A N/A N/A N/A N/A
	Transaction Date	N/A N/A N/A N/A N/A
	Relationship	N/A N/A N/A N/A N/A
	Property Owner	N/A N/A N/A N/A N/A
Relationship		None None None None None
Counterparty		L&K Engineering Co., Ltd. Wholetech System Hitech Ltd. Jer Yih Electrical Co., Ltd. Mega Union Technology Incorporated Rayzher Industrial Co., Ltd.
Payment Term		Monthly settlement by the construction progress and acceptance Monthly settlement by the construction progress and acceptance Monthly settlement by the construction progress and acceptance Monthly settlement by the construction progress and acceptance Monthly settlement by the construction progress and acceptance
Transaction Amount		$ 425,823 638,728 454,092 331,348 341,842
Event Date		2022.01.23-2022.12.08 2022.01.23-2022.12.22 2022.01.23-2022.12.22 2022.06.16-2022.12.18 2022.01.23-2022.12.22
Property		Buildings Buildings Buildings Buildings Buildings
Company Name		WEC

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Note	Note
Notes/Accounts Payable or Receivable	% to Total	12 10 - 3 - (100) (93) (7) (100) (95) 12 (10) (28) (5) 9 (1) 3 1
	Ending Balance	$ 553,174 461,590 1,135 140,764 21,464 USD (18,013) JPY (1,994,248) JPY (142,480) RMB (257) USD (4,584) 141,110 (158,632) (448,177) (84,359) 108,679 (20,828) 33,052 15,704
Abnormal Transaction	Payment Terms	N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
	Unit Price	N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Transaction Details	Payment Terms	Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 30 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 90 days from invoice date Net 15 days end of the month Net 15 days end of the month Net 15 days end of the month Net 90 days from invoice date Net 30 days from invoice date Net 90 days from invoice date Net 45 days from invoice date
	% of Total	14 11 6 3 - 100 97 3 100 100 41 24 13 4 1 2 1 1
	Amount	$ 7,349,083 5,640,271 2,914,234 1,661,541 173,887 USD 249,304 JPY 24,946,747 JPY 659,811 RMB 662,557 USD 56,502 8,079,378 1,961,416 1,045,764 335,654 262,269 173,354 149,214 229,401
	Purchase/ Sale	Sales Sales Sales Sales Sales Purchases Purchases Purchases Purchases Purchases Sales Purchases Purchases Purchases Sales Purchases Sales Sales
Relationship		Direct subsidiary with 100% ownership Direct subsidiary with 100% ownership Indirect subsidiary with 100% ownership Indirect subsidiary with 100% ownership Direct subsidiary with 51% ownership Parent company Parent company Direct subsidiary with 51% ownership Parent company Parent company NTC’s direct subsidiary with 100% ownership NTC’s indirect subsidiary with 100% ownership Related party in substance NTC’s direct subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership Parent company Direct subsidiary with 100% ownership Related party in substance
Related Party		WEHK WECJ WECN WECA NTC WEC WEC NTC WEC WEC NTHK NTCJ Waltech Advanced Engineering (Suzhou) Ltd. NTSG NTCA WEC WECJ Nyquest Technology Co., Ltd.
Company Name		WEC WEHK WECJ WECN WECA NTC NTC NTC NTC NTC NTC NTC NTC

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Note	Note
Notes/Accounts Payable or Receivable	% to Total	(100) (100) 5 9 56 (25) 14 (71) (12) 21 2 62
	Ending Balance	USD (4,595) USD (3,539) USD 5,165 USD 2,741 USD 16,902 JPY (2,233,479) JPY 1,871,831 USD (14,165) JPY (1,087,101) JPY 2,864,430 USD 619 JPY 138,201
Abnormal Transaction	Payment Terms	N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
	Unit Price	N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Transaction Details	Payment Terms	Net 90 days from invoice date Net 90 days from invoice date Net 15 days end of the month Net 15 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month Net 10 days end of the month
	% of Total	100 100 8 3 45 37 26 69 39 13 3 50
	Amount	USD 271,014 USD 8,744 USD 65,019 USD 10,791 USD 141,550 JPY 19,356,022 JPY 26,308,826 USD 202,508 JPY 20,139,308 JPY 13,025,750 USD 7,786 JPY 1,305,035
	Purchase/ Sale	Purchases Purchases Sales Sales Sales Purchases Sales Purchases Purchases Sales Sales Sales
Relationship		Parent company Parent company Parent company Parent company NTC’s indirect subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership NTC’s indirect subsidiary with 100% ownership Associate Related party in substance Related party in substance Associate
Related Party		NTC NTC NTC NTC NTCJ NTSG NTSG NTCJ TPSCo. Waltech Advanced Engineering (Suzhou) Ltd. Waltech Advanced Engineering (Suzhou) Ltd. TPSCo.
Company Name		NTHK NTCA NTCJ NTSG NTCJ NTSG NTCJ NTSG AMTC

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Allowance for Impairment Loss	Allowance for Impairment Loss	$ - - - - - - - - - -
Amount Received in Subsequent Period		$ 481,835 - - USD 1,571 141,110 108,679 USD 16,902 JPY 1,871,831 USD 5,165 JPY 2,864,430
Overdue	Action Taken	- - - - - - - - - -
	Amount	$ - - - - - - - - - -
	Turnover Rate	10.55 9.68 7.47 (Note) 91.16 3.49 9.69 14.11 17.08 4.91
	Ending Balance	$ 553,174 461,590 140,764 USD 5,591 141,110 108,679 USD 16,902 JPY 1,871,831 USD 5,165 JPY 2,864,430
	Relationship	Direct subsidiary with 100% ownership Direct subsidiary with 100% ownership Indirect subsidiary with 100% ownership Parent company NTC’s direct subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership NTC’s indirect subsidiary with 100% ownership NTC’s direct subsidiary with 100% ownership Direct subsidiary with 51% ownership Related party in substance
	Related Party	WEHK WECJ WECA WEC NTHK NTCA NTCJ NTSG NTC Waltech Advanced Engineering (Suzhou) Ltd.
	Company Name	WEC WECA NTC NTSG NTCJ

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Note	Note	(Note 1) (Note 1) (Note 2) (Notes 3 and 4)
Share of Profit (Loss)		$ 2,161,530 30,439 129,338 69,921 51,954 101,815 (404) (17,185) 12,301 673 26 386,750 (1,316) 30,487 45,313 (192) USD (6) (524) - 66,834 (17,224) (17,278) 14,445 1,186 10,280 168,131 907 1,352,222 (16,951) (3,737) 1,352,086 91,737 126,861
Net Income (Loss) of the Investee		$ 4,220,773 30,439 129,345 69,921 51,954 147,128 (404) (17,185) 12,301 673 26 1,026,111 (5,630) 30,487 147,128 (192) USD (6) (524) - 66,834 (17,224) (17,278) 14,445 1,186 10,280 168,131 907 1,352,222 (16,951) (3,737) 1,352,086 91,737 493,050
As ofDecember 31, 2022	Carrying Amount	$ 8,941,174 2,067,211 581,154 234,733 185,332 312,463 132,048 95,763 87,383 25,717 2,929 7,996,268 264,303 2,097,702 - 30,362 USD 989 102,348 3,000 611,146 285,197 368,652 147,758 21,647 210,631 1,959,771 12,708 7,567,843 285,197 294,012 11,402,133 233,534 1,710,869
	%	51.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 38.00 30.00 100.00 - 100.00 99.99 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 49.00
	Number of Shares	214,954,635 87,960,000 71,150,000 4,000 5,343,000 2,970 4,470,000 40,000,000 100,000 850,000 780,000 182,840,999 24,000,000 3,067 - 1,000,000 27,998,400 300,000 107,400,000 8,897,789 17,960,000 3,850,000 600,000 60,500 45,100,000 125,000 100 - 1,000 9,480 4,000 45,619
Original Investment Amount	December 31, 2021	$ 4,436,920 2,758,517 278,158 167,660 168,755 - 155,663 156,292 21,242 28,679 2,967 1,874,825 30,000 1,683,207 112,644 30,895 USD 1,000 135,415 - 427,092 274,987 590,953 38,500 30,211 190,862 1,319,054 30,828 5,927,849 1,473,559 46,905 111,520 55,760 -
	December 31, 2022	$ 4,436,920 2,758,517 278,158 167,660 168,755 190,070 155,663 156,292 21,242 28,679 2,967 1,874,825 240,000 1,683,207 - 30,895 USD 1,000 135,415 3,000 427,092 274,987 590,953 38,500 30,211 190,862 1,319,054 30,828 5,927,849 1,473,559 46,905 111,520 55,760 1,648,451
Main Businesses and Products		Research, design, development, manufacture and marketing of Logic IC, 6 inch wafer product, test, and OEM Investment holding Sales of semiconductor and investment holding Software and hardware integration design of semiconductor Investment holding Research, development, sales and after-sales service of semiconductor Investment holding Electronic commerce and investment holding Design and service of semiconductor Marketing service of semiconductor Investment holding Investment holding Agriculture and forestry botanic conservation Design, sales and service of semiconductor Research, development, sales and after-sales service of semiconductor Electronic commerce and investment holding Sales and service of semiconductor Development of software and services for automotive and industrial control Sales of semiconductor Investment holding Investment holding Investment holding Design, sales and service of semiconductor Design, sales and service of semiconductor Design, sales and service of semiconductor Design, sales and service of semiconductor Investment holding Investment holding Design and service of semiconductor Design, sales and service of semiconductor Design and service of semiconductor Foundry and sales of semiconductor
Location		Taiwan British Virgin Islands Hong Kong Japan British Virgin Islands Japan Seychelles Hong Kong Israel Germany Hong Kong Taiwan Taiwan United States of America Japan Hong Kong India Taiwan Hong Kong British Virgin Islands British Virgin Islands Taiwan India United States of America Singapore Korea Japan United States of America Israel Japan Japan Japan
Investee Company		Nuvoton Technology Corporation Winbond International Corporation Winbond Electronics (HK) Limited Miraxia Edge Technology Corporation Landmark Group Holdings Ltd. Winbond Electronics Corporation Japan Great Target Development Ltd. Callisto Holding Limited Winbond Technology Ltd. Winbond Electronics Germany GmbH Pine Capital Investment Limited Chin Xin Investment Co., Ltd. Hwa Bao Botanic Conservation Corp. Winbond Electronics Corporation America Winbond Electronics Corporation Japan Callisto Technology Limited GLMTD Technology Private Limited Miraxia Technology Taiwan Corporation Nuvoton Electronics Technology (H.K.) Limited Marketplace Management Limited Nuvoton Investment Holding Ltd. Song Yong Investment Corporation Nuvoton Technology India Private Limited Nuvoton Technology Corporation America Nuvoton Technology Singapore Pte. Ltd. Nuvoton Technology Korea Limited Nuvoton Technology Holdings Japan Goldbond LLC Nuvoton Technology Israel Ltd. Nuvoton Technology Corporation Japan Atfields Manufacturing Technology Corporation Tower Partners Semiconductor Co., Ltd.
Investor Company		Winbond Electronics Corp. Winbond International Corporation Landmark Group Holdings Ltd. Callisto Holding Limited Great Target Development Ltd. Miraxia Edge Technology Corporation Nuvoton Technology Corporation Marketplace Management Limited Nuvoton Investment Holding Ltd. Nuvoton Technology Holdings Japan Nuvoton Technology Corporation Japan

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Information on any investee company in mainland China, main businesses and procedures, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, investment income or loss, carrying amount of the investment at the end of the period and repatriations	of investment income:	Accumulated Remittance of Funds Accumulated	Investor Company Investee Company Main Businesses and Products Paid-in Capital Method of Investment Outward Remittance for Investment from Taiwan as of January 1, Outward Remittance for Investment from Taiwan as of December 31, Net Income of the Investee % Ownership of Direct or Indirect Investment Investment Gain (Note 1) Carrying Amount as of December 31, 2022 Accumulated Repatriation of Investment Income as of December 31, 2022 Outward Inward	2022 2022	WEC Winbond Electronics Design, development and marketing $ 276,435 Through investing in WEHK in the third area, $ 276,435 $ - $ - $ 276,435 $ 38,278 100 $ 38,278 $ 419,622 $ 35,880	(Suzhou) Limited of VLSI integrated ICs (USD 9,000) which then invested in the investee in (USD 9,000) (USD 9,000)	Mainland China indirectly	NTC Nuvoton Electronics Provide projects for sale in China and 68,036 Through investing in MML in the third area in 68,036 - - 68,036 (16,630) 51 (8,516) 147,465 -	Technology (Shanghai) repairing, testing, consulting of (USD 2,000) British Virgin Islands, which then invested in (USD 2,000) (USD 2,000)	Limited software and equipment lease of the investee in Mainland China indirectly	semiconductor	Winbond Electronics Computer software service (except 16,429 Through investing in MML in the third area in 16,429 - - 16,429 - 51 - (1,556) -	(Nanjing) Ltd. I.C. design) (USD 500) British Virgin Islands, which then invested in (USD 500) (USD 500) (Note 2)	the investee in Mainland China indirectly	Nuvoton Electronics Computer software service (except 197,670 Through investing in NTHK in the third area, 197,670 - - 197,670 4,749 51 2,432 117,041 -	Technology (Shenzhen) I.C. design), wholesale business for (USD 6,000) which then invested in the investee in (USD 6,000) (USD 6,000)	Limited computer, supplement and software Mainland China indirectly	NTSH Song Zhi Electronics Provide development of 8,688 Through investing in NTSH in the third area, - - - - (16) 51 (8) 4,203 -	Technology (Suzhou) semiconductor and technology, (CNY 2,000) which then invested in the investee in (Note 3) (Note 3)	consult service and equipment (Note 3) Mainland China indirectly	leasing business	Note 1: Investment profit or loss for the year ended December 31, 2022 was recognized under the basis of the financial statements audited by the Company’s auditor.	Note 2: WENJ has a negative net book value as of December 31, 2022, which is reclassified to other non-current liabilities.	Note 3: NTSH directly injected the capital in Song Zhi Electronics Technology (Suzhou).	Information on any investee company in mainland China, main businesses and procedures, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, investment income or loss, carrying amount of the investment at the end of the period and repatriations	of investment income:	Company Accumulated Outward Remittance for Investment in Mainland China as of December 31, 2022 Investment Amounts Authorized by Investment Commission, MOEA Upper Limit on the Amount of Investment Stipulated by Investment Commission, MOEA (Note 4)	WEC $ 276,435 (USD9,000) $ 276,435 (USD9,000) $ 56,497,798	NTC 282,135 (USD8,500) 282,135 (USD8,500) 10,539,562	Note 4: Upper limit on the amount of 60% of the investee’s net book value.	Refer to Table 5 for significant transactions with the investee in mainland China directly and indirectly through investing in companies in the third area.	Handling endorsement, guarantee and collateral to the investee in Mainland China directly and indirectly through investing in companies in the third area: None.	Financing of funds to investee in mainland China directly and indirectly through investing in companies in the third area: None.	Other transactions with significant influence on profit or loss for the period or financial performance: None.
1.																									2.						3.	4.	5.	6.

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TABLE 9

WINBOND ELECTRONICS CORPORATION AND SUBSIDIARIES

INFORMATION OF MAJOR SHAREHOLDERS DECEMBER 31, 2022

Name of Major Shareholder	Shares	Shares
	Number of Shares	Percentage of Ownership (%)
Walsin Lihwa Corporation Chin Xin Investment Co., Ltd.	883,848,423 240,003,072	22.20 6.03

Note 1: Table 9 is based on the information on the last business day of the quarter provided by the Taiwan Depository & Clearing Corporation (TDCC). The TDCC calculate the total number of ordinary shares and preferred shares held by shareholders who retain more than 5% of the Company’s share (including treasury shares) that have delivered without physical registration. The number of shares in the Company’s consolidated financial report and the actual number of shares delivered without physical registration may differ due to the different calculation basis.
Note 2: As per information above, if the shareholder delivers the shares to the trust, shares will be disclosed based on the trustee’s account. Additionally, according to the Securities and Exchange Act, internal stakeholder whom holds more than 10% of the Company’s share, which includes shares held by the stakeholder and parts delivered to the trust that have decision making rights, should be declared. For information regarding internal stakeholder declaration, please refer to the Market Observation Post System website of the Taiwan Stock Exchange Corporation.
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Analysis of Financial Status and Financial Performance and Risk Issues

I. Financial status

Unit: NT$ in thousands

Item\Fiscal Year	Consolidated Financial Statements for Fiscal Year 2022	Consolidated Financial Statements for Fiscal Year 2021	Increase (Decrease) Amount	Increase (Decrease) Ratio %
Total Assets	184,164,993	152,740,284	31,424,709	21
Current Assets	68,537,523	72,506,733	(3,969,210)	(5)
Property, Plant, and Equipment	93,806,639	61,079,605	32,727,034	54
Intangible Assets	782,603	1,072,985	(290,382)	(27)
Other Assets	21,038,228	18,080,961	2,957,267	16
Total Liabilities	81,431,277	62,706,772	18,724,505	30
Current Liabilities	27,776,754	28,644,931	(868,177)	(3)
Non-Current Liabilities	53,654,523	34,061,841	19,592,682	58
Total Equity	102,733,716	90,033,512	12,700,204	14
Equity Attributable to Owners of the Parent Company	94,162,996	82,444,113	11,718,883	14
Share Capital	39,800,002	39,800,002	-	-
Capital Reserve	7,785,918	7,786,124	(206)	-
Retained Earnings	32,215,117	22,808,020	9,407,097	41
Other Equity	14,361,959	12,049,967	2,311,992	19
Non-ControllingInterests	8,570,720	7,589,399	981,321	13
The main reasons for items with increase or decrease ratio over 20% are as follows:
1.Increase in property, plant, and equipment: mainly due to the establishment of			new plants in Kaohsiung and the purchase of
equipment.
2.Decrease in intangible assets: mainly due to amortization of computer software.
3.Increase in non-current liabilities: mainly due to an increase in long-term borrowings.
4.Increase in retained earnings: mainlydue to theprofit		in Fiscal Year 2022.

II. Financial performance

Unit: NT$ in thousands

==> picture [427 x 189] intentionally omitted <==

----- Start of picture text -----

Consolidated Financial Consolidated Financial
Increase (Decrease) Increase (Decrease)
Item\Fiscal Year Statements for Fiscal Statements for Fiscal
Amount Ratio %
Year 2022 Year 2021
Net Operating Income 94,529,790 99,569,924 (5,040,134) (5)
Operating Costs 51,478,707 57,088,857 (5,610,150) (10)
Gross Profit 43,051,083 42,481,067 570,016 1
Operating Expenses 26,516,502 24,053,145 2,463,357 10
Operating Profit 16,534,581 18,427,922 (1,893,341) (10)
Non-Operating Income and
1,511,591 (204,832) 1,716,423 (838)
Expenses
Net Profit before Tax 18,046,172 18,223,090 (176,918) (1)
Income Tax Expense 3,059,620 3,222,968 (163,348) (5)
Net Profit for the Period 14,986,552 15,000,122 (13,570) -
Other Comprehensive
2,717,903 4,186,931 (1,469,028) (35)
Income for the Period
Total Comprehensive
17,704,455 19,187,053 (1,482,598) (8)
Income for the Period
----- End of picture text -----

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==> picture [427 x 35] intentionally omitted <==

The main reasons for items with an increase or decrease ratio over 20% are as follows: 1.Increase in Non-Operating Income and Expenses: mainly due to a decrease in impairment loss on property, plant, and equipment and an increase in income from associated enterprises recognized using the equity method in Fiscal Year 2022. 2.Decrease in Other Comprehensive Income for the Period: mainly due to a decrease in unrealized gains on valuation of financial assets measured at fair value through other comprehensive income held by the Company and associated enterprises recognized using the equity method. Main factors for an expected continuing increase in sales in the year ahead: the company's annual production capacity in 2023 will reach 800,000 pieces to meet the needs of clients according to industry trends and market conditions.

III. Cash flow

(1) Cash Flow Analysis of Consolidated Financial Statements for Fiscal Year 2022

Unit: NT$ in millions

h flow ash Flow Analysis of Consolidated Financial Statements for Fiscal Year 2022	Unit: NT$in millions
Beginning cash balance (December 31, 2021) Net cash flow from operating activities (Fiscal Year 2022) Net cash flow from investing and financing activities (Fiscal Year 2022) Cash balance at the end of year (December 31, 2022)	Plan to improve insufficient liquidity
	Investment plan Financial planning
30,914 15,696 (26,207) 20,403	- -
1. Analysis of changes in cash flow in Fiscal Year 2022 Consolidated Financial Statements: (1) Operating activities: mainly due to net cash inflow of NT$15.7 billion from operating activities. (2) Investing activities: mainly due to net cash outflow of NT$41.74 billion from acquisition and disposal of property, plant, and equipment, net cash outflow of NT$2.53 billion from equity investments and other net cash outflow of NT$0.21 billion. (3) Financing activities: mainly due to cash inflow of NT$22.79 billion from an increase in borrowings, cash outflow of NT$3.98 billion for cash dividends, and other net cash outflow of NT$0.93 billion. 2. Improvementplan and liquidityanalysis for insufficient liquidity: no insufficient cash liquidity.

(2) Analysis of consolidated cash liquidity for the coming year

In the coming year, the Company and its subsidiaries expect a total net cash inflow of NT$12.6 billion from operating activities and total net cash outflow of 12.6 billion dollars from investing and financing activities, which will be mainly used for capital expenditures, financing, and cash dividends.

IV. Impact of major capital expenditures in the most recent fiscal year on financial operations

(1) Utilization of major capital expenditures and sources of funds in the most recent fiscal year

				Unit: NT$in millions	Unit: NT$in millions	Unit: NT$in millions
Project	Actual Source of Funds	Actual Completion Date Total Funds Actual Fund Utilization 2020 2021 2022		Actual Fund Utilization
					2021	2022
Plant and production capacity expansion, among other capital expenditures	Syndicated bank loans, corporate bond issuances, and reinvestment of earnings	Fiscal Year 2022	60,341	8,356	9,820	42,165

(2) Expected benefits

Expanded plants and production capacity, and accelerated development of process technologies to maintain market share.

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V. Reinvestment policy for the most recent fiscal year, main reasons for profits/losses generated thereby, improvement plans, and investment plans for the coming year
Reinvestment policy: principle underlying reinvestment to improve performance.
Profit or loss from reinvestment in the most recent fiscal year: In Fiscal Year 2022, the Company recognized a profit of NT$2,926 million from investments accounted for with the equity method (NT$512 million in consolidated statements recognized using the equity method).
Investment plans for coming year: Investment plans will be formulated as needed for reinvestment.

VI. Risk analysis and assessment

(1) Impact of interest and exchange rate fluctuations, changes on profits and losses, and future response measures
Interest rate fluctuations

Our exposure to interest rate risk is primarily derived from long-term floating rate loans required for upgrading fabrication or expanding capacity. We have negotiated favorable rates based on market conditions during financing to reduce impacts of fluctuations. Our NTD-denominated corporate bonds have fixed interest rates and are measured at amortized cost for changes not to affect cash flow and fair value.

Consolidated interest income in Fiscal Year 2022 amounted to NT$154,580,000 with a consolidated interest expense of NT$94,874,000. The impact of interest rate fluctuations on operations was assessed as being within a controllable range. We will closely monitor interest rate movement and its impact on cash flow.

2. Exchange Rate Fluctuations

In 2022, the Company’s risk from exchange rate fluctuations and foreign exchange gains or losses was within a controllable range. Our foreign exchange gains and losses mainly come from the foreign currency positions derived from import and export operations as well as the corresponding derivative financial products undertaken to avoid foreign exchange risk. The measures we take to manage this risk are as follows:

We engage in financial derivatives transactions for the purpose of hedging operational risks. Financial derivative products are selected to hedge risks associated with operations. In selecting trading counterparties, we give primary consideration to credit risk to avoid loss arising from a counterparty’s failure to perform contractual obligations. Counterparties are selected from financial institutions with low credit risk, have a good relationship with us, and are capable of furnishing required professional information.

We keep abreast of financial market information, observes trends, maintains an in-depth understanding of financial products, applicable laws and regulations, and trading techniques, and provides adequate and timely information to management and relevant departments for reference.

We limit unrealized loss on all financial derivative contracts to 20% of its value or 3% of shareholder equity, whichever is lower. The finance division evaluates our derivative position

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twice a month and prepares a report to be submitted to the head of finance and senior management authorized by the Board of Directors for review. Such evaluation is aimed at assessing the risk of every transaction and potential gains or losses resulting from it.

3. Inflation

Inflation in recent years has had a limited impact on our profit or loss.

(2) Policy regarding high-risk investments, highly leveraged investments, loans to other parties, endorsements, guarantees, derivatives transactions, main reasons for profits/losses generated thereby; and future response measures
1.We do not engage in high-risk investments or highly leveraged investments. Our derivatives transaction policy minimizes the risk of changes in the fair value of assets and liabilities to achieve economic hedging. Under this principle, all derivatives transactions undertaken correspond to our real positions. Any gains or losses on derivatives transactions and hedged positions during the period are due to time difference in the recognition of disposal of position and gain or loss on the transaction, which are non-significant. We also do not engage in high-risk derivatives transactions and will adhere to the principle of hedging only owned positions.
2.Loans to other parties, endorsements, guarantees:

We follow the Procedures for Lending Funds to Others and Procedures for Endorsements and Guarantees when lending funds and making endorsements and guarantees with careful consideration of risks.

(3) Future R&D work and estimated expenditures

The Company and its subsidiaries are expected to invest a total of approximately NT$17.8 billion in research and development in 2023. Our future directions of development include the following:

Dynamic Random-Access Memory (DRAM)
Specialty DRAM: We will continue to develop medium- to high-density products using the DRAM 25Snm process, primarily for applications in the 3C, automotive, and industrial electronics industries. We will also continue our research and development work on next generation DRAM 20nm and 16nm process technologies. Mobile DRAM: We will continue to develop medium- to high-density products with low power consumption, high bandwidth, and better data transfer rates, mainly for applications in mobile phones, tablets, low-power mobile devices, wearable devices, the Internet of Things, automotive and industrial electronics products, etc.
Code Storage Flash Memory
We will continue to develop the 32nm and 45nm process technologies to produce safe, high performance, energy-efficient, and value-added Code Storage Flash Memory product lines for applications in computing and peripheral products, mobile handheld devices and peripheral modules, network communications products, IoT, consumer electronics, automotive and industrial electronics, household appliance modules, and information security. We will also continue to develop advanced process technologies.
Logic IC

Our R&D into logic products will continue to focus on energy efficiency, information security, high performance CPU core platforms, innovative IP technologies, strengthening compliance with international standards for quality and reliability, and introducing advanced production platforms to increase our expertise in IoT, energy-efficient consumer electronics, industrial control, and automotive electronics to expand customer base and scope of applications to prepare for future industry changes. We will also continue to invest in logic IC R&D for use in cloud computing, smart handheld devices, and PCs while developing in three directions—secure management, energy efficiency, and a better user experience—to expand the scope of our products and applications and build on our existing foundation.

(4) Effect of major policies adopted and changes in the legal environment at home and abroad on financial operations, and response measures

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Our operational policies all comply with applicable laws and regulations. We closely monitors major policies that are adopted and changes in the legal environment at home and abroad and consult with relevant experts as necessary for recommendations and appropriate countermeasures. In the last year and up to the publication date of the annual report, our financial operations have not been affected by major changes in government policy and laws at home or abroad.

(5) Effect on financial operations of developments in science and technology (including cyber security risks) as well as industrial change, and response measures

We keep abreast of technological and market changes and assigns staff or a project team to study and evaluate impact on development and financial operations as well as response measures. During the current fiscal year up to the publication date of the annual report, there were no significant technological changes that exert a material impact on our financial operations.

(6) Effect on crisis management of changes in corporate image, and response measures

We inherently uphold the principles of honesty and integrity in practice. We serve customers with integrity and rigorously require employees to practice self-discipline and observe internal rules. We abide by the principles of information disclosure and financial transparency with various communication channels for shareholders, institutional investors, and the general public to better understand, recognize, and support our strategies. We have also set up dedicated departments to take charge of corporate and employee relations, internal audits, risk management, quality assurance, and customer service. These departments work closely with various business units to consolidate resources and strength. In case of any contingency, our senior management will act as convenor and promptly set up a response team to quickly address and resolve the crisis. We prepare readiness plans to prevent and control latent risks that we might face in the future. As of the publication date of the annual report, there were no changes in corporate image that calls for prompt actions in crisis management.

(7) Expected benefits and possible risks associated with acquisition, and mitigation measures.

The Company did not make any acquisitions during 2022 up to the publication date of the annual report.

(8) Expected benefits and possible risks associated with any plant expansion, and mitigation measures

We have a team of technicians to conduct feasibility evaluation on plant expansion and construction. The purpose of fab expansion is to improve advanced process technology and reduce production costs, which will increase our resilience to market competition and facilitate our expansion in the area of end-product applications. Given the high market volatility of the memory industry, we will closely monitor market trends and supply-demand situations, taking a robust approach to capacity allocation. We will optimize product mixes with diverse applications, and adopt a process-optimized cost structure to eliminate potential market risks. Financially, we will make prudent plans for our capital expenditures and funds, and draw up sound business plans to lower loan risks. We expect to have sufficient profit and cash flows to meet investment needs and fulfill repayment obligations. Our technical team consists of semiconductor wafer fabrication experts and IC design experts who have accumulated decades of experience in related fields. We will also introduce advanced processes from abroad and embark on R&D with our own technology. The switch to technology-based processes is expected to improve our cost control capability and augment the possibility of product application expansion. We will endeavor to tackle market volatility risks and maximize profitability by focusing on the aspects of product, finance, and technology.

(9) Risks associated with any consolidation of sales or purchasing operations, and mitigation measures

Risks associated with consolidation of purchasing operations include failure to receive deliveries from suppliers on time due to factory, financial, or quality incidents. We purchase raw materials from multiple sources and qualified suppliers to ensure supply stability.

Risks associated with consolidation of distribution are due to optimized customer structure and long-term strategic cooperation. We have established distribution, credit, and quality management regulations as well as effective internal control and audit systems. We also promote product applications and manage distribution with information-based operations. Therefore, we have no risks associated with consolidation of distribution.

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(10) Effect upon and risks in the event a major quantity of shares belonging to a director or shareholder with over 10% stake has been transferred or changed hands, and mitigation measures

During the current fiscal year up to the publication date of the annual report, our directors and Walsin Lihwa Corp., a shareholder with over 10% stake, did not transfer a major quantity of their shares.

(11) Effect upon and risk to company associated with any change in governance personnel or top management, and mitigation measures

None of the above situations occurred during the current fiscal year up to the publication date of the annual report.

(12) Major litigious and non-litigious matters

Concluded or ongoing major litigious, non-litigious or administrative disputes as of the date of publication of the annual report: None.
Concluded or ongoing major litigious, non-litigious or administrative disputes involving any director, general manager, person with actual responsibility, major shareholder with over 10% stake, and/or any company controlled by Winbond as of the date of publication of the annual report, with material affect on equity or prices of securities:

As of the publication date of the annual report, the lawsuit involving the Company’s subsidiary Nuvoton Technology can be described as follows:

On November 24, 2021, Company N filed a lawsuit in the Federal Court in Delaware, USA, accusing Nuvoton Technology Corporation America of infringing one of its patents. Company N applied to withdraw this lawsuit in February 2022, and the case has been closed.

As of the publication date of the annual report, there have been no significant legal cases involving the directors, general manager, actual controller, major shareholders holding more than 10% of the shares, and subsidiary companies of our company other than the above-mentioned legal case.

(13) Organizational structure of risk management

Duties and responsibilities in our risk management are distributed across various units. We have established internal management guidelines and operating procedures with comprehensive plans and processes for risk avoidance, loss prevention, and crisis management. Our management team continuously monitors changes in the macroeconomic environment that may affect business and operations. We appoint dedicated staff to make plans and take actions in the event of contingencies and minimize any uncertainties.

(14) Other significant risks and mitigation measures

No such situations have occurred during the current fiscal year up to the publication date of the annual report.

VII. Other matters of importance:

Key performance indicators specific to the industry

Key performance indicator	Fiscal Year 2022
Number of 12-inch wafers produced	629,236 pieces
Online average yield rate	99.43 %

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230 -

2. Profile of Individual Affiliates

December 31[st] , 2022; Unit NT$1,000

==> picture [487 x 594] intentionally omitted <==

----- Start of picture text -----

Date of
Name of Enterprise Address Paid-in Capital Main Business and Products
Establishment
Research, development,
production, and sale of
No. 8, Keya 1st Rd., Daya Dist., Taichung City 428,
Winbond Electronics Corporation 1987.09.29 TWD 39,800,002 semiconductor parts and
Taiwan, R.O.C.
components used in integrated
circuits and other system products
Palm Grove House, P.O.Box 438, Road Town,
Landmark Group Holdings Ltd. 2005.07.25 USD 5,343 Investments
Tortola, British Virgin Islands
Shin-Yokohama Square Bldg. 9F 2-3-12 Research, development, and sales
Winbond Electronics Corporation
2001.01.05 Shin-Yokohama, Kouhoku-ku, Yokohama, JPY 148,500 of semiconductor parts and
Japan
Kanagawa, Japan 222-0033 components, and after-sale service
Flemming House, Wickhams Cay, P.O. Box 662,
Winbond International Corporation 1995.08.28 USD 87,960 Investments
Road Town, Tortola, British Virgin Islands
Design, sale, and servicing of
Winbond Electronics Corporation 32 Loockerman Square, suite L-100, Dover,
1998.07.01 3 USD 58,917 semiconductor parts and
America Delaware 19904
components
No. 4, Franky Building, Providence Industrial
Great Target Development Ltd 2017.05.30 USD 4,470 Investments
Estate, Mahe, Seychelles.
Sales and servicing of
A-4, Phase-II, Noida, Gautam Buddha Nagar, Uttar
GLMTD Technology Private Limited 2017.08.07 INR 280,000 semiconductor parts and
Pradesh 201305, India
components
Investment and sales of
Unit 9-11, 22F, Millennium City 2, No 378 Kwun
Winbond Electronics (H.K.) Ltd. 2008.06.13 HKD 71,150 semiconductor parts and
Tong Road, Kowloon, Hong Kong
components, and after-sale service
Rm 1206, 12th Floor, No.505, Guang Ming Rd., Research, design, development,
Winbond Electronics (Suzhou) Ltd. 2011.06.21 Huaqiao Town, Kunshan City, Jiangsu Province, USD 9,000 and sales of integrated circuits and
China equipment, and after-sale service
Unit 9-11, 22F, Millennium City 2, No 378 Kwun
Pine Capital Investment Ltd. 2011.01.12 HKD 780 Investments
Tong Road, Kowloon, Hong Kong
1 Abba Eban Ave, Building B, First Floor Herzliya:
Winbond Technology Ltd 2013.07.31 ILS 1 [Design and servicing of]
4672519, Israel semiconductor components
Winbond Electronics Germany GmbH 2019.11.29 Pacellistrasse 8, 80333 Munich, Germany EUR 850 [Sale and servicing of semiconductor ]
components
Unit 9-11, 22F, Millennium City 2, No 378 Kwun
Callisto Holdings Limited 2018.05.04 HKD 40,000 E-commerce and Investment
Tong Road, Kowloon, Hong Kong
Unit 9-11, 22F, Millennium City 2, No 378 Kwun
Callisto Technology Limited 2018.10.23 USD 1,000 E-commerce and Investment
Tong Road, Kowloon, Hong Kong
Integrated design of
1 Kotari-yakemachi, Nagaokakyo City, Kyoto
Miraxia Edge Technology Corporation 1997.01.10 JPY 200,000 semiconductor-related software
617-8520, Japan
and hardware systems
Development of software and
Miraxia Technology Taiwan 17 F., No. 539, Sec. 2, Wenxing Rd., Zhubei City,
2022.11.17 TWD 3,000 services for automotive and
Corporation Hsinchu County 302052, Taiwan R.O.C.
industrial control systems
Research, design, development,
No.4, Yan Hsin 3rd Rd., Hsinchu Science and
Nuvoton Technology Corp. 2008.04.09 TWD 4,197,653 manufacturing, and sales of logic IC;
Industrial Park
6” fab production, testing, and OEM
P.O.Box 957, Offshore Incorporations Centre, Road
Marketplace Management Limited 2000.07.28 USD 8,898 Investments
Town, Tortola, British Virgin Islands
Goldbond LLC 2000.09.22 1912 Capitol Ave, Cheyenne, WY 82001 USD 44,775 Investments
Solutions and repair and
maintenance, testing, and
Nuvoton Electronics Technology Rm 2701, 27F, No. 2299, Yen An W. Rd., Shanghai, technology consultation service for
2001.03.30 RMB 16,555
(Shanghai) Ltd. China products sold in Mainland China
and related software; leasing of
semiconductor equipment
Winbond Technology (Nanjing) Ltd. 2005.09.21 Suite 413-40, Gao Xing Technology Industrial RMB 4,046 [Computer software services (except ]
Development Zone Office Building, Nanjing, China for IC design)
Design, sale, and servicing of
Nuvoton Technology Corporation
2008.05.01 251 Little Falls Drive, Wilmington, DE 19808 USD 6,050 semiconductor parts and
America
components
Sales and servicing of
Nuvoton Electronics Technology (H.K.) Unit 9-11, 22F, Millennium City 2, No 378 Kwun
1989.04.04 HKD 107,400 semiconductor parts and
Ltd. Tong Road, Kowloon, Hong Kong
components
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Date of
Name of Enterprise Address Paid-in Capital Main Business and Products
Establishment
Computer software services
Rm 801, 8F Microprofit Building, Gaoxinnan 6 [th] Rd.,
Nuvoton Electronics Technology (excluding IC design); computer and
2007.02.16 High-Tech Industrial Park, Nanshan Dist., RMB 46,434
(Shenzhen) Ltd. peripheral equipment and software
Shenzhen, China
wholesale
3rd Floor, Omar Hodge Building, Wickhams Cay I,
Nuvoton Investment Holdings Ltd. 2005.03.21 P.O. Box 362, Road Town, Tortola, British Virgin USD 17,960 Investments
Islands
Nuvoton Technology Israel Ltd. 2005.03.22 8 Hasadnaot Street, Herzliya B, 4672835 Israel ILS 1 [Design and servicing of ]
semiconductor components
3F., No.192, Jingye 1st Rd., Zhongshan Dist., Taipei
Song Yong Investment Corporation 2014.04.09 TWD 38,500 Investments
City 104, Taiwan
PS22-23, Bridge+, Unit No. 02-02 to 15, 2nd Floor, Design, sales, and servicing of
Nuvoton Technology India Private
2014.09.26 Ascendas Park Square Mall, Whitefield Road, ITPB, INR 60,000 semiconductor parts and
Limited
Bengaluru, 560066 components
Design, sales, and service of
Nuvoton Technology Singapore Pte.
2020.03.25 3 Bedok South Road, Singapore, 469269 USD 45,100 semiconductor parts and
Ltd.
components
Design, sales, and service of
Room 2507, Trade Tower, Yeongdong-daero 511,
Nuvoton Technology Korea Ltd. 2020.06.05 KRW 1,250,000 semiconductor parts and
Gangnam-Gu, Seoul, Korea, 06164
components
1 Kotari-yakemachi, Nagaokakyo City, Kyoto
Nuvoton Technology Holdings Japan 2020.04.01 JPY 5,000 Investments
617-8520, Japan
Design, sale, and servicing of
Nuvoton Technology Corporation 1 Kotari-yakemachi, Nagaokakyo City, Kyoto
2014..03.10 JPY 400,000 semiconductor parts and
Japan 617-8520, Japan
components
Atfields Manufacturing Technology 2000.03.01 800 Higashiyama, Uozu City, Toyama 937-8585, JPY 200,000 [Design and servicing of ]
Corporation Japan semiconductor components
Semiconductor technology
Pine Capital Electronics Technology 4F, Building 1, #379, Tayuan Road, Gao Xin District,
2020.12.04 RMB 2,000 development and consulting
(Suzhou) Ltd. Suzhou
services and equipment leasing
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Information on shareholders deemed to have superior-subordinate relationships: None
Profiles of Directors, Supervisors, and Presidents of Affiliates and Subsidiaries

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December 31 [st] , 2022; Unit: Shares
Shares Held
Name of Enterprise Title Name of Representative
Shares %
Chair Arthur Yu-Cheng Chiao 63,472,995 1.59%
Vice Chair Tung-Yi Chan 551,000 0.01%
Director Yung Chin 11,778,797 0.30%
Independent Director Allen Hsu - -
Independent Director Stephen T. Tso - -
Independent Director Francis Tsai - -
Winbond Electronics Independent Director Jerry Hsu - -
Corporation 883,848,423
Director Fred Pan (Representative of Walsin Lihwa Corporation) 22.20%
(Note 1)
240,003,072
Director Yuan-Mou Su (Representative of Chin Xin Investment) 6.03%
(Note 1)
Director Chih-Chen Lin - -
Director Wei-Hsin Ma - -
President James Pei-Ming Chen 407,525 0.01%
Director Winbond Electronics Corp. Representative - Arthur Yu-Cheng Chiao
Landmark Group 5,343,000
Holdings Ltd. Director Winbond Electronics Corp. Representative - Tung-Yi Chan (Note 1) 100%
Director Winbond Electronics Corp. Representative - Hsiang-Yun Fan
Director Winbond Electronics Corp. Representative - Tung-Yi Chan
Director Winbond Electronics Corp. Representative - Heiji Kobayashi
Director Winbond Electronics Corp. Representative - Wen-Chang Hung
Winbond Electronics 2,970
Corporation Japan Director Winbond Electronics Corp. Representative - James Pei-Ming Chen (Note 1) 100%
Director Winbond Electronics Corp. Representative - Hsiang-Yun Fan
Director Winbond Electronics Corp. Representative - Chih-Chung Chou
Supervisor Winbond Electronics Corp. Representative - Yung Chin
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Shares Held
Name of Enterprise Title Name of Representative
Shares %
President Heiji Kobayashi - -
Director Winbond Electronics Corp. Representative - Arthur Yu-Cheng Chiao
Winbond International 87,960,000
Corporation Director Winbond Electronics Corp. Representative - Tung-Yi Chan (Note 1) 100%
Director Winbond Electronics Corp. Representative - Hsiang-Yun Fan
Chair Winbond International Corporation Representative - Tung-Yi Chan
Winbond International Corporation Representative - James Pei-Ming
Director
Chen
Winbond International Corporation Representative - Arthur
Director
Yu-Cheng Chiao 3,067
Winbond Electronics 100%
Director Winbond International Corporation Representative - Yung Chin (Note 1)
Corporation America
Director Winbond International Corporation Representative - Hsiang-Yun Fan
Winbond International Corporation Representative - Chih-Chung
Director
Chou
Director Winbond International Corporation Representative - Eung Joon Park
President Eung Joon Park - -
Great Target Winbond Electronics Corp. Representative - Arthur Yu-Cheng Chiao 4,470,000
Director 100%
Development Ltd (Note 1) (Note 1)
Chair Great Target Development Ltd. Representative - Hsi-Jung Tsai
Director Great Target Development Ltd. Representative - Chih-Chung Chou
GLMTD Technology 27,998,400
Private Limited Director Great Target Development Ltd. Representative - Mao-Hsiang Yen (Note 1) 99.99%
Director Great Target Development Ltd. Representative - Chin-Feng Yang
Director Great Target Development Ltd. Representative -Varun Manwani
Chair Winbond Electronics Corp. Representative - Yung Chin
Director Winbond Electronics Corp. Representative - James Pei-Ming Chen 71,150,000
Winbond Electronics 100%
(H.K.) Ltd. Director Winbond Electronics Corp. Representative - Jessica Huang (Note 1)
Director Winbond Electronics Corp. Representative - Hsiang-Yun Fan
President Chih-Yung Chen
Chair Winbond Electronics (H.K.) Ltd. Representative - Tung-Yi Chan
Winbond Electronics (H.K.) Ltd. Representative - James Pei-Ming
Director
Chen
Winbond Electronics Director Winbond Electronics (H.K.) Ltd. Representative - Shu-Cheng Chang (Note 2) 100%
(Suzhou) Ltd. Director Winbond Electronics (H.K.) Ltd. Representative - Eddie Hung
Director Winbond Electronics (H.K.) Ltd. Representative - Chin-Feng Yang
Supervisor Winbond Electronics (H.K.) Ltd. Representative - Yung Chin
President Chih-Chung Chou - -
Chair Winbond Electronics Corp. Representative - Yung Chin
780,000
Pine Capital Investment Director Winbond Electronics Corp. Representative - Tung-Yi Chan 100%
(Note 1)
Ltd. Director Winbond Electronics Corp. Representative - Cheng-Kung Lin
President Jessica Huang
Chair Winbond Electronics Ltd. Representative - James Pei-Ming Chen
Director Winbond Electronics Corp. Representative - Tung-Yi Chan 100,000
Winbond Technology 100%
Ltd Director Winbond Electronics Corp. Representative – Emma Tai (Note 1)
Director Winbond Electronics Corp. Representative - Ilia Stolov
President Ilia Stolov - -
Director Winbond Electronics Corp. Representative - Hsiang-Yun Fan
Winbond Electronics 850,000
Germany GmbH Director Winbond Electronics Corp. Representative - Eddie Hung (Note 1) 100%
Director Winbond Electronics Corp. Representative - Chih-Chung Chou
Chair Winbond Electronics Corp. Representative – Jen-Lieh Lin
Director Winbond Electronics Corp. Representative - Cheng-Kung Lin
40,000,000
Callisto Holdings Director Winbond Electronics Corp. Representative - Eddie Hung 100%
(Note 1)
Limited Director Winbond Electronics Corp. Representative - Hsin-Lung Yang
Director Winbond Electronics Corp. Representative - Zi-Kai Chiao
President En-Tzu Lin - -
Director Winbond Electronics Corp. Representative - Cheng-Kung Lin
1,000,000
Callisto Technology Director Winbond Electronics Corp. Representative -Ruo-Wei Fu 100%
(Note 1)
Limited Director Winbond Electronics Corp. Representative - Zi-Kai Chiao
President Zi-Kai Chiao - -
Chair Winbond Electronics Corp. Institutional Appointee- Cheng-Kung Lin
Winbond Electronics Corp. Institutional Appointee - Shogo
Director
Nakazawa
Miraxia Edge 4,000
Winbond Electronics Corp. Institutional Appointee - Kazuhiro 100%
Technology Corporation Director (Note 1)
Koyama
Director Winbond Electronics Corp. Institutional Appointee - Zi-Kai Chiao
Director Winbond Electronics Corp. Institutional Appointee – J.D. Chiou
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Shares Held
Name of Enterprise Title Name of Representative
Shares %
Director Winbond Electronics Corp. Institutional Appointee -Pei-Ming Che
Director Winbond Electronics Corp. Institutional Appointee - Jen-Lieh Lin
Supervisor Winbond Electronics Corp. Institutional Appointee - Akihiko Nishida
Supervisor Winbond Electronics Corp. Institutional Appointee - Chin-Feng Yang
President Shogo Nakazawa - -
Miraxia Edge Technology Corporation Representative - Cheng-Kung
Chair
Lin
Miraxia Technology 300,000
Taiwan Corporation Director Miraxia Edge Technology Corporation Representative – Jen-Lieh Lin (Note 1) 100%
Miraxia Edge Technology Corporation Representative - Hsin-Lung
Director
Yang
Chair Nuvoton Investment Holdings Ltd. Representative - Hsin-Lung Yang
Director Nuvoton Investment Holdings Ltd. Representative - Yue-Fang Chong
Director Nuvoton Investment Holdings Ltd. Representative - Yuan-Mou Su
1,000
Nuvoton Technology Director Nuvoton Investment Holdings Ltd. Representative - Hui-Jun Lai 100%
(Note 1)
Israel Ltd. Director Nuvoton Investment Holdings Ltd. Representative - Jiann-Liang Su
Director Nuvoton Investment Holdings Ltd. Representative - Biranit Levany
Director Nuvoton Investment Holdings Ltd. Representative - Erez Naory
President Biranit Levany - -
Chair Winbond Electronics Corp. Representative - Yuan-Mou Su 214,954,635 51.21%
Vice Chair Zi-Kai Chiao - -
Director Arthur Yu-Cheng Chiao - -
Director Chin Xin Investment Corp. Representative - Jen-Lieh Lin 5,440,219 1.30%
Director Chi-Lin Wea - -
Nuvoton Technology Director Yu-Chun Hong - -
Corp. Director Chen Liang-Gee - -
Independent Director Mark Wei - -
Independent Director David Shu-Chyuan Tu - -
Independent Director Allen Hsu - -
Independent Director Kuang-Chung Chen - -
President Hsin-Lung Yang 97,362 0.02%
Director Nuvoton Technology Corp. Representative - Arthur Yu-Cheng Chiao
Marketplace 8,897,789
Management Limited Director Nuvoton Technology Corp. Representative - Tung-Yi Chan (Note 1) 100%
Director Nuvoton Technology Corp. Ltd. Representative - Hung-Wen Huang
Marketplace Management Limited Representative - Arthur
Manager (Note 3)
Yu-Cheng
Goldbond LLC Manager (Note 3) Marketplace Management Limited Representative - Jessica C. Huang (Note 2) 100%
Marketplace Management Limited Representative - Hung-Wen
Manager (Note 3))
Huang
Chair Goldbond LLC Representative – Hsi-Jung Tsai
Director Goldbond LLC Representative – Hsin-Lung Yang
Nuvoton Electronics Director Goldbond LLC Representative – Meng-Chi Wu
(Note 2) 100%
Technology (Shanghai) Director Goldbond LLC Representative – Yue-Fang Chong
Ltd. Director Goldbond LLC Representative – Hui-Jun Lai
Supervisor Goldbond LLC Representative – Justin Chan
President Ruo-Wei Fu - -
Chair Goldbond LLC Representative – Jen-Lieh Lin
Winbond Technology Director Goldbond LLC Representative – Xiu-Fen Lai (Note 2) 100%
(Nanjing) Ltd. Director Goldbond LLC Representative – Hui-Jun Lai
President Bosco Chi-Sing Law - -
Chair Nuvoton Technology Corp. Representative - Yuan-Mou Su
Director Nuvoton Technology Corp. Representative - Aditya Raina
Director Nuvoton Technology Corp. Representative - Vivian Yeh
60,500
Nuvoton Technology Director Nuvoton Technology Corp. Representative - Xiu-Fen Lai 100%
(Note 1)
Corporation America Director Nuvoton Technology Corp. Representative - Meng-Chi Wu
Director Nuvoton Technology Corp. Representative - Hirofumi Taguchi
Director Nuvoton Technology Corp. Representative - Keiji Ito
President Aditya Raina - -
Chair Nuvoton Technology Corp. Representative - Zi-Kai Chiao
Director Nuvoton Technology Corp. Representative - Yung Chin
107,400,000
Nuvoton Electronics Director Nuvoton Technology Corp. Representative - Xiu-Fen Lai (Note 1) 100%
Technology (H.K.) Ltd Director Nuvoton Technology Corp. Representative - Hsin-Lung Yang
Director Nuvoton Technology Corp. Representative - Yo-Song Cheng
President Ruo-Wei Fu - -
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Shares Held
Name of Enterprise Title Name of Representative
Shares %
Chair Nuvoton Electronics Tech. (H.K.) Ltd. Representative - Hsi-Jung Tsai
Director Nuvoton Electronics Tech. (H.K.) Ltd. Representative - Xiu-Fen Lai
Director Nuvoton Electronics Tech. (H.K.) Ltd. Representative - Meng-Chi Wu
Nuvoton Electronics Nuvoton Electronics Tech. (H.K.) Ltd. Representative - Hsin-Lung
Director (Note 2) 100%
Technology (Shenzhen) Yang
Ltd. Nuvoton Electronics Tech. (H.K.) Ltd. Representative - Yue-Fang
Director
Chong
Supervisor Nuvoton Electronics Tech. (H.K.) Ltd. Representative - Justin Chan
President Ruo-Wei Fu - -
Director Nuvoton Technology Corp. Representative -Arthur Yu-Cheng Chiao
Nuvoton Investment 17,960,000
Holdings Ltd. Director Nuvoton Technology Corp. Representative -Jessica Huang (Note 1) 100%
Director Nuvoton Technology Corp. Representative -Hung-Wen Huang
Chair Nuvoton Investment Holdings Ltd. Representative - Hsin-Lung Yang
Director Nuvoton Investment Holdings Ltd. Representative - Yue-Fang Chong
Director Nuvoton Investment Holdings Ltd. Representative - Yuan-Mou Su
1,000
Nuvoton Technology Director Nuvoton Investment Holdings Ltd. Representative - Hui-Jun Lai 100%
(Note 1)
Israel Ltd. Director Nuvoton Investment Holdings Ltd. Representative - Jiann-Liang Su
Director Nuvoton Investment Holdings Ltd. Representative - Biranit Levany
Director Nuvoton Investment Holdings Ltd. Representative - Erez Naory
President Biranit Levany - -
Chair Nuvoton Technology Corp. Representative - Hsiang-Yun Fan
Song Yong Investment Director Nuvoton Technology Corp. Representative - Arthur Yu-Cheng Chiao 3,850,000
100%
Corporation Director Nuvoton Technology Corp. Representative - Xiu-Fen Lai (Note 1)
Supervisor Nuvoton Technology Corp. Representative - Jen-Lieh Lin
Chair Nuvoton Technology Corp. Representative - Hsi-Jung Tsai
Director Nuvoton Technology Corp. Representative - Jitendra Patil
600,000
Nuvoton Technology Director Nuvoton Technology Corp. Representative - Hsin-Lung Yang 100%
(Note 1)
India Private Limited Director Nuvoton Technology Corp. Representative - Meng-Chi Wu
Director Nuvoton Technology Corp. Representative - Hui-Jun Lai
President Jitendra Patil - -
Director Nuvoton Technology Corp. Institutional Appointee - Yo-Song Cheng
Director Nuvoton Technology Corp. Institutional Appointee -Yue-Fang Chong
Director Nuvoton Technology Corp. Institutional Appointee - Yi-Tsai Hsu 45,100,000
Nuvoton Technology 100%
Singapore Pte. Ltd. Director Nuvoton Technology Corp. Institutional Appointee - Meng-Chi Wu (Note 1)
Nuvoton Technology Corp. Institutional Appointee - Yoshitaka
Director
Kinoshita
President Yi-Tsai Hsu - -
Representative
Nuvoton Technology Corp. Institutional Appointee - Hsin-Lung Yang
125,000
Nuvoton Technology Director Nuvoton Technology Corp. Institutional Appointee - Xiu-Fen Lai 100%
(Note 1)
Korea Ltd. Director Nuvoton Technology Corp. Institutional Appointee -Jen-Lieh Lin
Director Nuvoton Technology Corp. Institutional Appointee - Susumu Sawai
President Ahn Jung Mo - -
Nuvoton Technology Corp. Institutional Appointee - Arthur
Representative
Yu-Cheng Chiao 100
Nuvoton Technology Director Nuvoton Technology Corp. Institutional Appointee - Yuan-Mou Su (Note 1) 100%
Holdings Japan
Director Nuvoton Technology Corp. Institutional Appointee -Xiu-Fen Lai
President Yoshitaka Kinoshita - -
Nuvoton Technology Holdings Japan Institutional Appointee -
Chair
Yuan-Mou Su
Nuvoton Technology Holdings Japan Institutional Appointee -
Director
Kazuhiro Koyama
Nuvoton Technology Holdings Japan Institutional Appointee -
Director
Susumu Sawai
Nuvoton Technology Holdings Japan Institutional Appointee -Zi-Kai
Director
Nuvoton Technology Chiao 9,480
100%
Corporation Japan Nuvoton Technology Holdings Japan Institutional Appointee - (Note 1)
Director
Xiu-Fen Lai
Nuvoton Technology Holdings Japan Institutional Appointee -
Director
Yoshitaka Kinoshita
Nuvoton Technology Holdings Japan Institutional Appointee -
Director
Mamoru Yoshida
Nuvoton Technology Holdings Japan Institutional Appointee -
Director
Hsin-Lung Yang
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Shares Held
Name of Enterprise Title Name of Representative
Shares %
Nuvoton Technology Holdings Japan Institutional Appointee - Sakae
Director
Suzuki"
Nuvoton Technology Holdings Japan Institutional Appointee -
Supervisor
Akihiko Nishida
Nuvoton Technology Holdings Japan Institutional Appointee -Hiroshi
Supervisor
Yasuda"
President Kazuhiro Koyama - -
Nuvoton Technology Corporation Japan Institutional Appointee -
Director
Daihei Kajiwara
Nuvoton Technology Corporation Japan Institutional Appointee -
Director
Kazuhiro Koyama
Nuvoton Technology Corporation Japan Institutional Appointee -
Director
Arthur Yu-Cheng Chiao
Nuvoton Technology Corporation Japan Institutional Appointee –
Director
Ming-Yi Tsai 4,000
Atfields Manufacturing 100%
Nuvoton Technology Corporation Japan Institutional Appointee – (Note 1)
Technology Corporation Director
Mao-Hsiang Yan
Nuvoton Technology Corporation Japan Institutional Appointee -
Director
Hiroshi Matsushima
Nuvoton Technology Corporation Japan Institutional Appointee -
Director
Hiromasa Kurokawa
Nuvoton Technology Corporation Japan Institutional Appointee -
Supervisor
Akio Nakagawa
President Hiroshi Matsushima - -
Nuvoton Electronics Technology. (Shanghai) Ltd. Representative -
Chair
Jessica Huang
Nuvoton Electronics Technology. (Shanghai) Ltd. Representative -
Director
Pine Capital Electronics Yo-Song Cheng
(Note 2) 100%
Technology (Suzhou) Nuvoton Electronics Technology. (Shanghai) Ltd. Representative
Director
Ltd. -Xiu-Fen Lai
Nuvoton Electronics Technology. (Shanghai) Ltd. Representative
Supervisor
-Hung-Wen Huang
President Ruo-Wei Fu - -
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Notes:

Shares held by Institutional shareholders.
Winbond Electronics (Suzhou) Ltd., Goldbond LLC, Nuvoton Technology (Shanghai) Ltd, Winbond Technology (Nanjing) Ltd., Nuvoton Technology (Shenzhen) Ltd., and Pine Electronics (Suzhou) Co., Ltd. are not joint stock companies.
Goldbond LLC is a company with a manager system

5. Industries covered by the business operated by affiliates overall

Industries covered by affiliates’ operations primarily include those involved in the research, design, development, production, distribution, and service of integrated circuits, semiconductor parts and components, and other system products. A few of our affiliates operate investment businesses. In general, our affiliates support each other through technology, marketing, and services, enabling Winbond to become the most competitive company with its product lines.

6. Business overview of affiliates

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December 31 [st] , 2022; Unit: NT$1,000; Earnings (loss) per share (NT$)
Net Earnings
Total Operating Operating Net Income
Name of Enterprise Capital Total Assets Net Worth (Loss) per
Liabilities Revenue Profit (Loss) (Loss)
share (NTD)
Winbond Electronics Corporation 39,800,002 156,006,594 61,843,598 94,162,996 51,139,171 11,484,680 12,927,165 3.25
Landmark Group Holdings Ltd. 164,084 197,681 12,349 185,332 52,320 51,954 51,954 9.72
Winbond Electronics Corporation
34,511 869,534 557,071 312,463 6,055,295 190,464 147,128 49,538.26
Japan
Winbond International Corporation 2,701,252 2,098,962 31,751 2,067,211 30,633 30,439 30,439 0.35
Winbond Electronics Corporation
1,809,347 2,321,891 224,189 2,097,702 2,289,236 69,506 30,487 9,940.23
America
Great Target Development Ltd 137,274 102,401 0 102,401 7 (404) (404) (0.09)
GLMTD Technology Private Limited 103,936 102,490 142 102,348 0 (1,055) (524) (0.02)
Winbond Electronics (H.K.) Ltd. 280,189 1,270,223 689,072 581,151 7,578,767 107,255 129,345 1.82
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249

236 -

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Net Earnings
Total Operating Operating Net Income
Name of Enterprise Capital Total Assets Net Worth (Loss) per
Liabilities Revenue Profit (Loss) (Loss)
share (NTD)
Winbond Electronics (Suzhou) Ltd. 276,390 431,356 23,451 407,905 3,076,490 46,501 38,278 (Note 1)
Pine Capital Investment Ltd. 3,072 3,085 156 2,929 230 26 26 0.03
Winbond Technology Ltd 9 185,554 98,171 87,383 380,084 18,099 12,301 123.01
Winbond Electronics Germany GmbH 27,812 29,869 4,152 25,717 15,511 587 673 0.79
Callisto Holdings Limited 157,520 98,776 3,013 95,763 4,232 (10,553) (17,185) (0.43)
Callisto Technology Limited 30,710 30,549 187 30,362 0 (196) (192) (0.19)
Miraxia Edge Technology Corporation 46,480 491,159 256,426 234,733 1,087,569 101,491 69,921 17.48
Miraxia Technology Taiwan
3,000 3,000 0 3,000 0 0 0 0.00
Corporation
Nuvoton Technology Corp 4,197,653 26,265,228 8,699,290 17,565,938 19,520,219 2,967,595 4,220,773 10.06
Marketplace Management Limited 273,251 285,681 484 285,197 88 (273) (17,224) (1.94)
Goldbond LLC 1,375,035 288,449 3,526 284,923 90 (305) (16,951) (Note 1)
Nuvoton Electronics Technology
72,973 102,778 19,582 83,196 103,966 179 (16,630) (Note 1)
(Shanghai) Ltd.
Winbond Technology (Nanjing) Ltd. 17,833 48 3,086 (3,038) 0 0 0 (Note 1)
Nuvoton Technology Corporation
185,796 422,143 211,511 210,632 765,943 24,756 10,280 169.92
America
Nuvoton Electronics Technology (H.K.)
422,941 825,564 206,181 619,383 8,494,364 75,324 66,834 0.62
Ltd
Nuvoton Electronics Technology
204,681 267,123 30,332 236,791 201,575 2,937 4,749 (Note 1)
(Shenzhen) Ltd.
Nuvoton Investment Holdings Ltd. 551,552 368,692 40 368,652 151 (1,917) (17,278) (0.96)
Nuvoton Technology Israel Ltd. 9 651,596 357,584 294,012 1,138,930 28,142 (3,737) (3,737.00)
Song Yong Investment Corporation 38,500 148,284 526 147,758 15,017 14,803 14,445 3.75
Nuvoton Technology India Private
22,272 21,837 190 21,647 4,536 216 1,186 1.98
Limited
Nuvoton Technology Singapore Pte.
1,385,021 2,876,647 916,876 1,959,771 9,301,590 215,055 168,131 3.73
Ltd.
Nuvoton Technology Korea Ltd. 30,500 13,185 477 12,708 35,397 1,686 907 7.26
Nuvoton Technology Holdings Japan 1,162 7,941,361 649 7,940,712 1,352,086 1,352,127 1,352,222 [13,522,222.4]
3
Nuvoton Technology Corporation
92,960 18,514,207 7,112,074 11,402,133 24,560,316 1,040,111 1,352,086 142,625.09
Japan
Atfields Manufacturing Technology
46,480 315,976 82,442 233,534 843,847 122,943 91,737 22,934.18
Corporation
Pine Electronics (Suzhou) Co., Ltd. 8,816 8,207 0 8,207 0 (36) (16) (Note 1)
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Notes:

Winbond Electronics (Suzhou) Ltd., Goldbond LLC, Nuvoton Technology (Shanghai) Ltd., Winbond Technology (Nanjing) Ltd., and Nuvoton Technology (Shenzhen) Ltd. are not joint stock companies and are thus N/A.
Exchange rates used for asset and liability entries: 1 USD= 30.71 NTD; 1 JPY=0.2324 NTD; 1 RMB =4.408 NTD; 1 ILS= 8.7301 NTD; 1 EUR= 32.72 NTD; 1 INR= 0.3712 NTD
Exchange rates used for profit and loss entries: 1 USD= 29.81 NTD; 1 JPY= 0.2275 NTD; 1 RMB =4.4219 NTD; 1 ILS= 8.8689 NTD; 1 EUR= 31.36 NTD; 1 INR= 0.3793 NTD

(II) Consolidated financial statements for Affiliates: Please see p.68 ~ 235.

(III) Affiliation report: Not applicable (the Company is not a subsidiary of another company)

II. Private placements: None

III. Holding or disposal of Company stocks by subsidiaries in the past year and up to the date of report: None

IV. Other necessary supplemental information: None
V. Corporate events with material impact on shareholders' equity or stock prices in the past year and up to the date of report, as outlined in Subparagraph 2, Paragraph 3, Article 36 of the Securities and Exchange Act: None

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Headquarters - Taiwan

CTSP Fab: No. 8, Keya 1st Rd., Daya Dist., Central Taiwan Science Park, Taichung City 428303, Taiwan Tel: 886-4-2521-8168

Kaohsiung Fab: No. 35, Luke 5th Rd., Kaohsiung Science Park, Luzhu Dist., Kaohsiung City 821011, Taiwan Tel: 886-7-6278168

Zhubei Building: No. 539, Sec. 2, Wenxing Rd., Zhubei City, Hsinchu County 302052, Taiwan Tel: 886-3-5678168 Taipei Office: 2F, No. 192, Jingye 1st Rd., Zhongshan Dist., Taipei City 104051, Taiwan 26F, No. 1, Songzhi Rd., Xinyi Dist., Taipei City 110411, Taiwan Tel: 886-2-8177-7168

Winbond Electronics Corporation America

2727 North First Street, San Jose, CA 95134, U.S.A. Tel: 1-408-943-6666

Winbond Electronics (H.K.) Limited

Unit 9-11, 22F, Millennium City 2, 378 Kwun Tong Road, Kowloon, Hong Kong Tel: 852-2751-3126

Winbond Electronics (Suzhou) Limited

Room 1206, kingboard Plaza (Building B, 12 floor), No. 505, Guangming Road, Huaqiao Town, Kunshan City, Jiangsu Province, China. Tel: 86-512-8163-8168

Winbond Electronics Corporation Japan

Shin-Yokohama Square Bldg. 9F, 2-3-12 Shin-Yokohama, Kouhoku-ku, Yokohama, Kanagawa 222-0033, Japan Tel: 81-45-478-1881

Winbond Technology LTD

1 Abba Eban Ave., Building B, First Floor, Herzliya 4672519, Israel Tel: 972-9-866-0700

Winbond Electronics Germany GmbH

Pacellistraße 8, 80333 Munich, Germany Tel: 49-1590-2999-993

Miraxia Edge Technology Corporation

1 Kotari-yakemachi, Nagaokakyo City, Kyoto 617-8520, Japan Tel: 81-75-956-9499

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AI assistant

WEC — Annual Report 2022

52017_rns_2023-06-14_0ccdf8bb-16de-43fb-b1cc-cc99f6a550b4.pdf

1. Spokesperson

2. Deputy Spokesperson

3. Company Address and Telephone

4. Common Stock Transfer Office

5. Auditor

Table of Contents

Financial Overview

A Letter to Our Shareholders

Dear Shareholders,

Financial Performance

Market and Product Applications

Capacity Planning

Product Innovation and Technology Development

Corporate Sustainability

Honors and Awards

Future Prospects

Company Profile

(I) Company History

(II) Major business developments in the past year and up to the date of the report

(III) Investment in affiliates in the past year and up to the date of the report

2. Major business units and their key operations

Directors (2)

Directors (3)

Board diversity:

Implementation of board diversity

3. Distribution of Employee Bonuses to Managers

(A) Directors

IV. Corporate Governance Status

(2) Communication between independent directors and CPAs:

3. Operational status of the Remuneration Committee:

(2) Operational state of the Remuneration Committee:

Winbond Electronics Corporation Statement of Internal Control System

Date: February 16, 2023

11.2 Significant Resolutions of the Board Meetings for 2022 and up to March 16, 2023:

V. Certified public accountant’s fee information

VI. Change of accountant: There was no change of accountant in 2022.

IX. Information on the top ten shareholders who are related to each other or are spouses or second-degree relatives

X. Consolidated shareholding percentage

Fundraising Status

I. Capital and Shares

(I) Sources of equity

(II) Shareholder structure

(III) Share ownership distribution

1.Common Stock:

(IV) List of major shareholders

(V) Stock price, book value, earnings, dividends, and related data for the previous two years

(VI) Dividend policy and implementation status

1. Dividend policy

(VII) Impact of stock dividend issuance on the Company's business performance and EPS: Not applicable

(VIII) Employee and director remuneration

(IX) Stock Buyback: None

Business Overview

I. Description of Business

(1) Scope of Business

1. Main Business and Breakdown of Revenues

2. Main Products

2.1. DRAM

2.2. Code Storage Flash Memory

2.3. Logic IC

3. New products and services under development

3.1. DRAM

3.2. Code Storage Flash Memory

3.3 Logic IC

(2) Industry Overview

1.1 DRAM

1.2 Code Storage Flash Memory

1.3 Logic IC

2.1 Memory industry

2.2 Logic IC industry

3.1 DRAM

3.2 Code Storage Flash Memory

3.3 Logic IC

(3) Technology and R&D Overview

2.1 DRAM

2.2 Code Storage Flash Memory

(IV) Long- and Short-Term Business Development Plans

1.1 DRAM

WEC Annual Report 2022