YC — Audit Report / Information 2023

Nov 13, 2023

YC Inox Co., Ltd.

Parent Company Only Financial Statements for the Years Ended December 31, 2023 and 2022 and Independent Auditors’ Report

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders YC Inox Co., Ltd.

Opinion

We have audited the accompanying parent company only financial statements of YC Inox Co., Ltd. (the “Company”), which comprise the parent company only balance sheets as of December 31, 2023 and 2022, the parent company only statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the parent company only financial statements, including material accounting policy information (collectively referred to as the “financial statements”).

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the parent company only financial position of the Company as of December 31, 2023 and 2022, and its parent company only financial performance and its parent company only cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the parent company only financial statements for the year ended December 31, 2023. These matters were addressed in the context of our audit of the parent company only financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

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The key audit matter of the Company’s parent company only financial statements for the year ended December 31, 2023 is described as follows:

Inventory Valuation

The amount of inventory held by the Company is considered material to the parent company only financial statements; out of this amount, inventory is made based on the lower of cost and net realizable value of inventory. As the inputs and assumptions used in the determination of the net realizable value involve management’s judgment, inventory assessment has been deemed a key audit matter. For the accounting policies, significant accounting judgments, estimates and uncertainty of assumptions related to inventory assessment as well as other related disclosures, refer to Notes 4, 5, and 10.

The main audit procedures performed with respect to the aforementioned key audit matter are as follows:

1. We obtained an understanding of and assessed the appropriateness of the Company’s policies on the provision for inventory valuation loss and the related internal control procedures.

2. We obtained the inventory valuation report, selected samples and reviewed the correctness and reasonableness of the net realizable value.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements for the year ended December 31, 2023 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

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The engagement partners on the audits resulting in this independent auditors’ report are Done-Yuin Tseng and Shu-Chin Chiang.

Deloitte & Touche Taipei, Taiwan Republic of China

March 8, 2024

Notice to Readers

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

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

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YC INOX CO., LTD.

PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash (Notes 4 and 6) Financial assets at fair value through profit or loss - current (Notes 4 and 7) Notes receivable (Notes 4 and 20) Trade receivables (Notes 4, 9, 20 and 27) Other receivables (Note 4) Inventories (Notes 4, 5 and 10) Prepayments Other current assets (Notes 4 and 28) Total current assets NON-CURRENT ASSETS Financial assets at fair value through other comprehensive income - non-current (Notes 4 and 8) Investments accounted for using the equity method (Notes 4 and 11) Property, plant and equipment (Notes 4 and 12) Right-of-use assets (Notes 4 and 13) Computer software (Notes 4 and 14) Deferred tax assets (Notes 4 and 22) Prepayments for equipment Other non-current assets (Note 4) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 15) Contract liabilities - current (Note 20) Notes payable Trade payables Other payables (Notes 17 and 18) Current tax liabilities (Notes 4 and 22) Lease liabilities - current (Notes 4 and 13) Current portion of long-term borrowings (Note 15) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Financial liabilities at fair value through profit or loss - non-current (Notes 4 and 16) Bonds payable (Notes 4 and 16) Long-term borrowings (Note 15) Deferred tax liabilities (Notes 4 and 22) Lease liabilities - non-current (Notes 4 and 13) Net defined benefit liabilities - non-current (Notes 4 and 18) Guarantee deposits received Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY Share capital Ordinary shares Registered capital (pending change) Capital surplus Retained earnings Legal reserve Unappropriated earnings Other equity Total equity TOTAL		2023 Amount % $ 431,443 2 198,000 1 74,444 - 668,333 4 490,340 3 3,050,044 17 104,363 1 2,100 - 5,019,067 28 1,612,380 9 6,137,723 34 4,324,205 24 4,646 - 5,499 - 466,083 2 501,524 3 51,505 - 13,103,565 72 $ 18,122,632 100 $ 5,681,078 31 419,149 2 494 - 112,304 1 210,847 1 105,266 1 2,707 - 471,429 3 16,432 - 7,019,706 39 - - 228,240 2 1,844,048 10 2,614 - 2,026 - 41,284 - 34,545 - 2,152,757 12 9,172,463 51 4,475,783 25 224,241 1 2,302,582 13 1,346,931 7 133,890 1 466,742 2 8,950,169 49 $ 18,122,632 100		2022 Amount % $ 486,484 3 248,011 1 88,122 - 760,684 4 241,027 1 4,186,741 22 205,467 1 5,224 - 6,221,760 32 2,640,544 14 5,350,518 28 4,370,107 23 8,301 - 7,697 - 299,228 1 305,483 2 52,404 - 13,034,282 68 $ 19,256,042 100 $ 4,754,074 25 378,950 2 556 - 174,828 1 276,569 1 327,177 2 3,624 - 160,714 1 26,880 - 6,103,372 32 236 - 765,149 4 1,882,143 10 2,614 - 4,732 - 51,148 - 30,385 - 2,736,407 14 8,839,779 46 4,453,799 23 - - 2,005,108 10 1,292,961 7 1,022,254 5 1,642,141 9 10,416,263 54 $ 19,256,042 100

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

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YC INOX CO., LTD.

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

NET REVENUE (Notes 4, 20 and 27) OPERATING COSTS (Notes 5, 10 and 21) GROSS PROFIT REALIZED (UNREALIZED) GAIN ON TRANSACTIONS WITH SUBSIDIARIES (Note 4) REALIZED GROSS PROFIT OPERATING EXPENSES (Note 21) Selling and marketing expenses General and administrative expenses Total operating expenses INCOME FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES (Note 4) Finance costs (Note 21) Share of profit or loss of subsidiaries (Notes 4 and 11) Interest income (Loss) gain on disposal of property, plant and equipment Other gains and losses, net (Notes 21 and 27) Foreign exchange gain, net Loss (gain) on fair value changes of financial instruments at fair value through profit or loss Total non-operating income and expenses (LOSS) PROFIT BEFORE INCOME TAX INCOME TAX (BENEFIT) EXPENSE (Notes 4 and 22) NET (LOSS) PROFIT OTHER COMPREHENSIVE INCOME (LOSS) (Note 4) Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit plans (Note 18) Unrealized (loss) gain on investments in equity instruments at fair value through other comprehensive income Share of other comprehensive income (loss) of subsidiaries accounted for using the equity method Income tax related to items that will not be reclassified subsequently to profit or loss (Note 22)		2023 Amount % $ 13,624,052 100 12,484,239 91 1,139,813 9 5,459 - 1,145,272 9 451,709 3 187,368 2 639,077 5 506,195 4 (140,702) (1) (690,853) (5) 9,200 - (5,534) - 18,522 - 39,721 - 30,205 - (739,441) (6) (233,246) (2) (63,431) (1) (169,815) (1) 5,912 - (1,028,164) (8) (113,204) (1) (1,182) - (1,136,638) (9)		2022
				Amount % $ 16,262,547 100 13,625,686 84 2,636,861 16 (9,578) - 2,627,283 16 898,309 6 228,386 1 1,126,695 7 1,500,588 9 (78,634) - (943,373) (6) 4,435 - 403 - 34,659 - 156,616 1 (19,111) - (845,005) (5) 655,583 4 137,301 1 518,282 3 16,011 - 276,568 2 34,506 - (6,791) - 320,294 2

(Continued)

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YC INOX CO., LTD.

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

Items that may be reclassified subsequently to profit or loss: Exchange differences on translation of the financial statements of foreign operations (Note 4) Income tax related to items that may be reclassified subsequently to profit or loss (Note 22) Other comprehensive income (loss) for the year, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE YEAR (LOSS) EARNINGS PER SHARE (Note 23) Basic Diluted		2023 Amount % $ (42,538) - 8,507 - (34,031) - (1,170,669) (9) $ (1,340,484) (10) $ (0.38) $ (0.38)		2022
				Amount % $ 1,031,005 6 (206,201) (1) 824,804 5 1,145,098 7 $ 1,663,380 10 $ 1.16 $ 1.09

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

(Concluded)

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YC INOX CO., LTD.

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars)

BALANCE AT JANUARY 1, 2022 Appropriation of 2021 earnings Legal reserve Cash dividends distributed by the Company Net profit for the year ended December 31, 2022 Other comprehensive income (loss) for the year ended December 31, 2022, net of income tax Total comprehensive income (loss) for the year ended December 31, 2022 Convertible bonds converted to ordinary shares Disposal of investments in equity instruments at fair value through other comprehensive income by subsidiaries BALANCE AT DECEMBER 31, 2022 Appropriation of 2022 earnings Legal reserve Cash dividends distributed by the Company Net loss for the year ended December 31, 2023 Other comprehensive income (loss) for the year ended December 31, 2023, net of income tax Total comprehensive income (loss) for the year ended December 31, 2023 Convertible bonds converted to ordinary shares BALANCE AT DECEMBER 31, 2023	Ordinary Shares (Note 19) Registered Capital Stock Ordinary Shares Capital Pending Change Capital Surplus (Note 19) $ 4,445,345 $ 1,080 $ 1,994,700 - - - - - - - - - - - - - - - 8,454 (1,080) 10,408 - - - 4,453,799 - 2,005,108 - - - - - - - - - - - - - - - 21,984 224,241 297,474 $ 4,475,783 $ 224,241 $ 2,302,582	Retained Earnings (Note 19) Legal Reserve Unappropricated Earnings $ 1,166,385 $ 1,276,096 126,576 (126,576) - (666,964) - 518,282 - 12,809 - 531,091 - - - 8,607 1,292,961 1,022,254 53,970 (53,970) - (669,309) - (169,815 ) - 4,730 - (165,085) - - $ 1,346,931 $ 133,890	Other Equity (Note 4) Exchange Differences on Unrealized Gain (Loss) on Financial Assets at Fair Value Translating through Other Foreign Operations Comprehensive Income $ (1,012,464) $ 1,530,923 - - - - - - 824,804 307,485 824,804 307,485 - - - (8,607) (187,660) 1,829,801 - - - - - - (34,031) (1,141,368) (34,031) (1,141,368) - - $ (221,691) $ 688,433	Total Equity $ 9,402,065 - (666,964) 518,282 1,145,098 1,663,380 17,782 - 10,416,263 - (669,309) (169,815 ) (1,170,669) (1,340,484) 543,699 $ 8,950,169

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

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YC INOX CO., LTD.

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES (Loss) income before income tax Adjustments for: Depreciation expense Amortization expense (Gain) loss on financial instruments at fair value through profit or loss, net Interest expense Interest income Dividend income Share of loss of subsidiaries Loss (gain) on disposal of property, plant and equipment Write-down of inventories (Realized) unrealized gain on transactions with subsidiaries Unrealized loss on foreign currency exchange, net Changes in operating assets and liabilities: Notes receivable Trade receivables Other receivables Inventories Prepayments Other current assets Contract liabilities Notes payable Trade payables Other payables Other current liabilities Net defined benefit liabilities Cash generated from operations Interest received Dividends received Interest paid Income tax paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of financial assets at fair value through other comprehensive income Disposal of financial assets at fair value through profit or loss Acquisition of subsidiaries Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of computer software Decrease in other non-current assets Increase in prepayments for equipment Net cash used in investing activities		2023 $ (233,246) 297,341 4,050 (30,205) 140,702 (9,200) (14,038) 690,853 5,534 72,200 (5,459) 31,000 13,678 80,159 (268,289) 1,064,497 101,104 3,124 40,199 (62) (62,524) (91,450) (10,443) (3,952) 1,815,573 9,200 14,038 (132,530) (318,010) 1,388,271 - 79,980 (1,628,341) (208,133) 42,868 (1,852) 899 (259,438) (1,974,017)		2022
				$ 655,583 280,746 3,479 19,111 78,634 (4,435) (10,425) 943,373 (403) 112,000 9,578 10,131 78,098 473,500 52,816 2,216,095 172,751 (2,223) (139,254) (14,001) (596,542) (158,806) 692 (4,098) 4,176,400 4,435 10,425 (71,145) (300,259) 3,819,856 (35,826) - (3,286,873) (375,128) 15,249 (5,098) - (111,807) (3,799,483)

(Continued)

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YC INOX CO., LTD.

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from short-term borrowings Repayments of short-term borrowings Proceeds from long-term borrowings Repayments of long-term borrowings Decrease in guarantee deposits received Repayments of the principal portion of lease liabilities Cash dividends paid to owners of the Company Net cash generated from (used in) financing activities NET DECREASE IN CASH CASH AT THE BEGINNING OF THE YEAR CASH AT THE END OF THE YEAR		2023 $ 19,582,566 (18,655,562) 1,000,000 (727,380) 4,160 (3,770) (669,309) 530,705 (55,041) 486,484 $ 431,443		2022
				$ 20,146,919 (20,881,538) 1,400,000 (257,143) (245) (3,579) (666,964) (262,550) (242,177) 728,661 $ 486,484

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

(Concluded)

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NOTES TO PARENT COMPANY ONLY FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (Amounts in Thousands of New Taiwan Dollars, Unless Specified Otherwise)

YC INOX CO., LTD.

1. GENERAL INFORMATION

YC Inox Co., Ltd. (the “Company”) was incorporated in the Republic of China (ROC) in January 1973; and is mainly engaged in the production, processing and sale of stainless steel pipes, stainless steel sheets and coils, agency services and international trading of stainless steel products.

The Company’s shares were listed and have been trading on the Taiwan Stock Exchange since September 2001.

The parent company only financial statements of the Company are presented in the Company’s functional currency, the New Taiwan dollar.

2. APPROVAL OF FINANCIAL STATEMENTS

The parent company only financial statements were approved by the Company’s board of directors on March 8, 2024.

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

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

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

• b. The IFRS Accounting Standards endorsed by the FSC for application starting from 2024

Effective Date New, Amended and Revised Standards and Interpretations Announced by IASB (Note 1)

Amendments to IFRS 16 “Lease Liability in a Sale and Leaseback” January 1, 2024 (Note 2) 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 Amendments to IAS 7 and IFRS 7 “Supplier Finance Arrangements” January 1, 2024 (Note 3)

• Note 1: Unless stated otherwise, the above IFRS Accounting Standards will be 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.

Note 3: The amendments provide some transition relief regarding disclosure requirements.

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As of the date the parent company only financial statements were authorized for issue, the Company has assessed that the application of other standards and interpretations will not have a material impact on the Company’s financial position and financial performance.

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

New, Amended and Revised Standards and Interpretations Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” Amendments to IFRS 17 Amendments to IFRS 17 “Initial Application of IFRS 17 and IFRS 9 - Comparative Information” Amendments to IAS 21 “Lack of Exchangeability”	Effective Date Announced by IASB (Note 1)
	To be determined by IASB January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2025 (Note 2)

• Note 1: Unless stated otherwise, the above IFRS Accounting Standards are effective for annual reporting periods beginning on or after their respective effective dates.

• Note 2: An entity shall apply those amendments for annual reporting periods beginning on or after January 1, 2025. Upon initial application of the amendments, the entity recognizes any effect as an adjustment to the opening balance of retained earnings. When the entity uses a presentation currency other than its functional currency, it shall, at the date of initial application, recognize any effect as an adjustment to the cumulative amount of translation differences in equity.

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

4. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION

• a. Statement of compliance

The parent company only financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRS Accounting Standards as endorsed and issued into effect by the FSC.

• b. Basis of preparation

The parent company only financial statements have been prepared on the historical cost basis except for financial instruments which are measured at fair value and net defined benefit liabilities which are measured at the present value of the defined benefit obligation less the fair value of plan assets.

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

• 1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;

• 2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

• 3) Level 3 inputs are unobservable inputs for the asset or liability.

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When preparing the parent company only financial statements, the Company accounts for subsidiaries by using the equity method. In order to agree with the amount of net income, other comprehensive income and equity attributable to shareholders of the parent in the consolidated financial statements, the differences of the accounting treatment between the parent company only basis and the consolidated basis are adjusted under the heading of investments accounted for using equity method, share of profit or loss subsidiaries and share of other comprehensive income of subsidiaries in the parent company only financial statements.

• c. Classification of current and noncurrent assets and liabilities

Current assets include:

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

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

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

Current liabilities include:

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

• 2) Liabilities due to be settled within 12 months after the reporting period; and

• 3) Liabilities for which the Company does not have an unconditional right to defer settlement for at least 12 months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

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

• d. Foreign currencies

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

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

Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Exchange differences arising from the retranslation of non-monetary items are included in profit or loss for the period except for exchange differences arising from the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income, in which case, the exchange differences are also recognized directly in other comprehensive income.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction and are not retranslated.

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For the purpose of presenting the parent company only financial statements, the financial statements of the Company’s foreign operations (including subsidiaries in other countries or those that use currencies different from the currency of the Company) are translated into the presentation currency, the New Taiwan dollar, as follows: Assets and liabilities are translated at the exchange rates prevailing at the end of the reporting period; and income and expense items are translated at the year exchange rates for the period. The resulting currency translation differences are recognized in other comprehensive income.

• e. Hyperinflation

Beginning April 21, 2022, Turkey's economy qualifies as hyperinflationary, according to the criteria established in the IAS 29 “Financial information in hyperinflationary economies”. As specified in IAS 29, the financial statements of Turkish subsidiaries have been measured in terms of the current unit of measurement at the balance sheet date, which leads to a gain or loss on the net monetary position included in the profit or loss.

The Company has not applied hyperinflationary accounting to restate comparative financial information presented in NTD, which is the Company’s functional currency unmodified as IAS 29. Moreover, the adoption of IAS 29 in Turkish subsidiaries requires assets and liabilities as well as the items in the income statement to be restated using the closing exchange rate at period end, leading to the effect of hyperinflation adjustments included in other comprehensive income.

• f. Inventories

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

• g. Investments in subsidiaries

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

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

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

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

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

• h. Property, plant and equipment

Property, plant and equipment are measured at cost less accumulated depreciation.

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Property, plant and equipment in the course of construction for production, supply or administrative purposes are carried at cost. Cost includes professional fees and borrowing costs eligible for capitalization. Such assets are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for their intended use.

Depreciation of property, plant and equipment is recognized using the straight-line method. Each significant part is depreciated separately. The estimated useful lives, residual values and depreciation methods are reviewed at the end of each reporting period, with the effects of any changes in the estimates accounted for on a prospective basis.

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

i. Computer software

• 1) Computer software acquired separately

Computer software with finite useful lives that are acquired separately are initially measured at cost and subsequently measured at cost less accumulated amortization. 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.

• 2) Derecognition of computer software

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

• j. Impairment of property, plant and equipment, right-of-use assets and computer software

At the end of each reporting period, the Company reviews the carrying amounts of its property, plant and equipment, right-of-use assets and computer software, to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

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.

k. Financial instruments

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

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

• 15 -

1) Financial assets

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

• a) Measurement categories

Financial assets held by the Company are classified into the following categories: financial assets at FVTPL, financial assets at amortized cost, investments in debt instruments at fair value through other comprehensive income (FVTOCI) and investments in equity instruments at FVTOCI.

i. Financial assets at FVTPL

Financial assets are classified as at FVTPL when such financial assets are mandatorily classified as at FVTPL. Financial assets mandatorily classified as at FVTPL include investments in equity instruments which are not designated as at FVTOCI.

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 incorporate any dividends or interest earned on such a financial asset. Fair value is determined in the manner described in Note 26.

• ii. Financial assets at amortized cost

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

• i) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and

• ii) The contractual terms of the financial 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, including cash, notes receivable, trade receivables, other receivables, pledged time deposits, and refundable deposits are measured at amortized cost, which equals the gross carrying amount determined using the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

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

• i) Purchased or originated credit-impaired financial asset, for which interest income is calculated by applying the credit-adjusted effective interest rate to the amortized cost of such financial assets; and

• ii) Financial asset that is not credit impaired on purchase or origination but has 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.

A financial asset is credit impaired when one or more of the following events have occurred:

• i) Significant financial difficulty of the issuer or the borrower;

• ii) Breach of contract, such as a default;

• 16 -

• iii) It is becoming probable that the borrower will enter bankruptcy or undergo a financial reorganization; or

• iv) The disappearance of an active market for that financial asset because of financial difficulties.

• iii. Investments in debt instruments at FVTOCI

Debt instruments that meet the following conditions are subsequently measured at FVTOCI:

• i) The debt instrument is held within a business model whose objective is achieved by both the collecting of contractual cash flows and the selling of such financial assets; and

• ii) The contractual terms of the debt instrument give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Investments in debt instruments at FVTOCI are subsequently measured at fair value. Changes in the carrying amounts of these debt instruments relating to changes in foreign currency exchange rates, interest income calculated using the effective interest method and impairment losses or reversals are recognized in profit or loss. Other changes in the carrying amounts of these debt instruments are recognized in other comprehensive income and will be reclassified to profit or loss when the investment is disposed of.

• iv. Investments in equity instruments at FVTOCI

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

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

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

• b) Impairment of financial assets

The Company recognizes a loss allowance for expected credit losses on financial assets at amortized cost (including trade receivables) and investments in debt instruments that are measured at FVTOCI.

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

• 17 -

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

For internal credit risk management purposes, the Company determines that the following situations indicate that a financial asset is in default (without taking into account any collateral held by the Company):

• i. Internal or external information show that the debtor is unlikely to pay its creditors.

• ii. When a financial asset is more than 180 days past due unless the Company has reasonable and corroborative information to support a more lagged default criterion.

The impairment loss of all financial assets is recognized in profit or loss by a reduction in their carrying amounts through a loss allowance account, except for investments in debt instruments that are measured at FVTOCI, for which the loss allowance is recognized in other comprehensive income and the carrying amounts of such financial assets are not reduced.

• c) Derecognition of financial assets

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

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

2) 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.

The repurchase of the Company’s own equity instruments is recognized in and deducted directly from equity. No gain or loss is recognized in profit or loss on the purchase, sale, issuance or cancellation of the Company’s own equity instruments.

3) Financial liabilities

• a) Subsequent measurement

Except the following situations, all financial liabilities are measured at amortized cost using the effective interest method:

• 18 -

Financial liabilities are classified as at FVTPL when such financial liabilities are held for trading. Financial liabilities held for trading are stated at fair value, and any gains or losses on such financial liabilities are recognized in other gains or losses.

• b) Derecognition of financial liabilities

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

3) Convertible bonds

The component parts of compound instruments (i.e., convertible bonds) issued by the Company are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

On initial recognition, the fair value of the liability component is estimated using the prevailing market interest rate for similar non-convertible instruments. This amount is recorded as a liability on an amortized cost basis using the effective interest method until extinguished upon conversion or upon the instrument’s maturity date. Any embedded derivative liability is measured at fair value.

The conversion option classified as equity is determined by deducting the amount of the liability component from the fair value of the compound instrument as a whole. This is recognized and included in equity, net of income tax effects, and is not subsequently remeasured. In addition, the conversion option classified as equity will remain in equity until the conversion option is exercised; in which case, the balance recognized in equity will be transferred to capital surplus - share premiums. When the conversion option remains unexercised at maturity, the balance recognized in equity will be transferred to capital surplus - other.

Transaction costs that relate to the issuance of the convertible notes are allocated to the liability and equity components in proportion to the allocation of the gross proceeds. Transaction costs relating to the liability component are included in the carrying amount of the liability component. Transaction costs relating to the equity component are recognized directly in equity.

l. Revenue recognition

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

For contracts where the period between the date on which the Company transfers a promised good or service to a customer and the date on which the customer pays for that good or service is one year or less, the Company does not adjust the promised amount of consideration for the effects of a significant financing component.

Revenue from the sales of goods comes from sales of stainless steel sheets, coils and pipes. Sales of goods are recognized as revenue when the goods are delivered to the customer’s specific location/the goods are shipped/the goods are picked up because it is the time when the customer has full discretion over the manner of distribution and price to sell the goods, has the primary responsibility for sales to future customers and bears the risks of obsolescence. Trade receivables are recognized concurrently.

The transaction price received is recognized as a contract liability until the goods have been delivered to the customer.

The Company does not recognize revenue on materials delivered to subcontractors because this delivery does not involve a transfer of control.

• 19 -

m. Leases

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

1) The Company as lessor

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

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

2) The Company as lessee

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

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. 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.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. Lease liabilities are presented on a separate line in the parent company only balance sheets.

• n. Borrowing costs

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

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

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

• o. 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.

• 20 -

Government grants are recognized on a systematic basis over the periods in which the Company recognizes as expenses the related costs that the grants intend to compensate.

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.

• p. Employee benefits

• 1) Short-term employee benefits

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

• 2) Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as expenses when employees have rendered services entitling them to the contributions.

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

Net defined benefit liabilities (assets) represent the actual deficit (surplus) in the Company’s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.

• q. Taxation

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

1) Current tax

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

According to the Income Tax Act in the ROC, an additional tax on unappropriated earnings is provided for in the year the shareholders approve to retain earnings.

Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

• 2) Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities and the corresponding tax bases used in the computation of taxable profit.

Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences and unused loss carryforwards to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

• 21 -

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

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the assets to be recovered. A previously unrecognized deferred tax asset is also reviewed at the end of each reporting period and recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

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

• 3) Current and deferred tax

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

5. MATERIAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

When developing material accounting estimates, the Company considers the possible impact on the cash flow projection, growth rates, discount rates, profitabilities and other relevant material estimates. The estimates and underlying assumptions are reviewed on an ongoing basis.

Key Sources of Estimation Uncertainty - Write-down of Inventories

The net realizable value of inventories 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 historical experience with product sales of a similar nature. Changes in market conditions may have a material impact on the estimation of the net realizable value.

• 22 -

6. CASH

Cash on hand Checking accounts and demand deposits Annual interest rate (%) Demand deposits		**December 31 **	**December 31 **
		2023 $ 1,220 430,223 $ 431,443 0.07-1.45	2022 $ 903 485,581 $ 486,484 0.07-1.05

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

Current Financial assets mandatorily classified as at FVTPL Domestic listed shares		**December 31 **	**December 31 **
		2023 $ 198,000	2022 $ 248,011

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME - NON-CURRENT

Investments in equity instruments Foreign investments Unlisted shares Domestic investments Emerging market shares		December 31	December 31
		2023 $ 182,253 1,430,127 $ 1,612,380	2022 $ 182,253 2,458,291 $ 2,640,544

These investments in equity instruments are held for 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.

9. TRADE RECEIVABLES

At amortized cost Gross carrying amount Less: Allowance for impairment loss At FVTOCI		December 31	December 31
		2023 $ 646,788 (2,242) 644,546 23,787 $ 668,333	2022 $ 750,879 (2,242) 748,637 12,047 $ 760,684

• 23 -

a. At amortized cost

The credit period of sales of goods is 30 to 150 days. No interest was charged on trade receivables. 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. The Company uses other publicly available financial information or its own trading records to rate its 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 by the management 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 year to ensure that adequate allowance is made for possible irrecoverable amounts. In this regard, the management believes the Company’s credit risk has been significantly reduced.

The Company measures the loss allowance for trade receivables at an amount equal to lifetime ECLs. The expected credit losses on trade receivables are estimated using a provision matrix by reference to the past default records of the debtor and an analysis of the debtor’s current financial position, adjusted for general economic conditions of the industry in which the debtor operates and an assessment of both the current as well as the forecasted GDP and direction of economic conditions at the reporting date. As the Company’s historical credit loss experience did not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished according to the Company’s different customer base.

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

The loss allowance of trade receivables of the Company was as follows:

December 31, 2023 Expected credit loss rate (%) Gross carrying amount Loss allowance Amortized cost December 31, 2022 Expected credit loss rate (%) Gross carrying amount Loss allowance Amortized cost	Not Past Due 0 $ 584,657 - $ 584,657 0 $ 650,628 - $ 650,628	Past Due 1-60 Days 0 $ 62,129 (2,242) $ 59,887 0.01-0.17 $ 100,251 (2,242) $ 98,009	Past Due 61-120 Days 0 $ 2 - $ 2 4.27-15.73 $ - - $ -	Past Due 121-180 Days 0 $ - - $ - 14.77-15.21 $ - - $ -	Past Due More than 180 Days 100 $ - - $ - 100 $ - - $ -	Total $ 646,788 (2,242) $ 644,546 $ 750,879 (2,242) $ 748,637

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

Balance at January 1 and December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 2,242	2022 $ 2,242

• 24 -

b. At FVTOCI

The Company will decide whether to sell these trade receivables to banks without recourse based on its level of working capital. These trade receivables are classified as at FVTOCI because they are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets.

As of December 31,2023 and 2022, the Company had no overdue trade receivables, and no impairment loss was recognized within the respective aging ranges.

Refer to Note 26 for details of the factoring for trade receivables.

10. INVENTORIES

Raw materials Work in progress Semi-finished goods Finished goods Merchandise		December 31	December 31
		2023 $ 931,437 57,821 310,060 1,738,324 12,402 $ 3,050,044	2022 $ 1,581,008 63,163 348,923 2,176,797 16,850 $ 4,186,741

Operating costs related to inventory for the years ended December 31, 2023 and 2022 were $12,475,308 thousand and $13,624,211 thousand, respectively. The cost of goods sold included the loss on inventory write-downs of $72,200 thousand and $112,000 thousand, respectively.

11. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD - INVESTMENTS IN SUBSIDIARIES

Investments in Subsidiaries Chi Mao Investment Co., Ltd. (Chi Mao Company) YC INOX TR CELIK SANAYI VE TICARET A.S. (YC INOX TR Company)		December 31	December 31	December 31
		2023		2022
		Proportion of Amount Ownership (%) $ 190,698 100 5,947,025 100 $ 6,137,723		Proportion of Amount Ownership (%) $ 305,687 100 5,044,831 100 $ 5,350,518

For the nature of activities of the subsidiaries listed above, refer to Table 5.

The Company invested $1,628,341 thousand and $3,286,873 thousand in YC INOX TR Company, which engaged in seasoned equity offerings for the years ended December 31, 2023 and 2022, respectively. The aforementioned investments have been approved by the Overseas Chinese and Foreign Investment Commission of the Ministry of Economic Affairs (MOEA). Among the investments, the Company has been planning to increase the investment in YC INOX TR Company by TRY820,000 thousand, which was approved by the Company’s board of directors in November 2022 and subsequently invested $641,560 thousand, $306,850 thousand and $415,381 thousand, equivalent to TRY372,142 thousand, TRY187,555 thousand and TRY260,303 thousand in November 2022, January 2023 and February 2023, respectively. The aforementioned investments have been approved by the MOEA.

• 25 -

The Company has been planning to increase the investment in YC INOX TR Company by TRY900,000 thousand, which was approved by the Company’s board of directors in May 2023, and subsequently invested $430,360 thousand, $314,200 thousand and $161,550 thousand, equivalent to TRY272,646 thousand, TRY269,329 thousand and TRY142,913 thousand in May 2023, August 2023 and November 2023, respectively. The remaining investments were remitted from Taiwan in January 2024 amounting to $221,464 thousand equivalent to TRY215,112 thousand. The aforementioned investments were approved by the MOEA.

The share of profit or loss and other comprehensive income of the subsidiaries accounted for using the equity method for the years ended December 31, 2023 and 2022 were recognized based on the subsidiaries’ financial statements which have been audited for the same period.

12. PROPERTY, PLANT AND EQUIPMENT

Cost Balance at January 1, 2023 Additions Disposals Reclassification Balance at December 31, 2023 Accumulated depreciation Balance at January 1, 2023 Additions Disposals Balance at December 31, 2023 Carrying amount at December 31, 2023 Cost Balance at January 1, 2022 Additions Disposals Reclassification Balance at December 31, 2022 Accumulated depreciation Balance at January 1, 2022 Additions Disposals Balance at December 31, 2022 Carrying amount at December 31, 2022	Land $ 1,999,794 17,272 - - $ 2,017,066 $ - - - $ - $ 2,017,066 $ 1,999,794 - - - $ 1,999,794 $ - - - $ - $ 1,999,794	Buildings $ 1,497,060 31,252 (46) 2,468 $ 1,530,734 $ 654,788 70,830 (26) $ 725,592 $ 805,142 $ 1,482,722 14,338 - - $ 1,497,060 $ 586,798 67,990 - $ 654,788 $ 842,272	Machinery and Equipment $ 2,708,265 97,326 (19,751) 45,821 $ 2,831,661 $ 1,854,358 130,785 (17,604) $ 1,967,539 $ 864,122 $ 2,631,388 74,276 (64,789) 67,390 $ 2,708,265 $ 1,791,190 125,688 (62,520) $ 1,854,358 $ 853,907	Other Equipment $ 1,198,684 86,938 (92,129) 15,109 $ 1,208,602 $ 524,550 92,071 (45,894) $ 570,727 $ 637,875 $ 949,535 257,280 (18,827) 10,696 $ 1,198,684 $ 447,232 83,568 (6,250) $ 524,550 $ 674,134	Total $ 7,403,803 232,788 (111,926) 63,398 $ 7,588,063 $ 3,033,696 293,686 (63,524) $ 3,263,858 $ 4,324,205 $ 7,063,439 345,894 (83,616) 78,086 $ 7,403,803 $ 2,825,220 277,246 (68,770) $ 3,033,696 $ 4,370,107

Property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives as follows:

Buildings Office buildings 20-35 years Plants 10-20 years Machinery and equipment 3-15 years Other equipment 3-20 years

• 26 -

Farmland held by the Company which is situated in No.1357 and 1359 (2,034 square meters) of Xinmei Section, Shijou Township, Chang-Hwa County and No.115 (171 square meters), No.115-1 and 115-2 (3,218 square meters), and No.116 (120 square meters) situated in Xinguan Section., Puoshing Township, Chang-Hwa County were designated as parking lots, finished goods storage and loading areas. As registration for the transfer of ownership rights cannot currently be implemented in accordance with the law, all farmland was registered under the name of Chairman Chang, Chin-Yu, and all 6 lots of land were mortgaged to the Company for a total of $40,000 thousand.

Furthermore, in September 2023, the Company acquired farmland located at No.1368 (6,148 square meters) of Xinmei Section, Shijou Township, Chang-Hwa County for a contract price of $17,272 thousand. This land is currently being used as parking lots. As registration for the transfer of ownership rights cannot currently be implemented in accordance with the law, the property is currently being registered under the name of Chairman Chang, Chin-Yu. The Company has secured a mortgage on the aforementioned land for a total consideration of $30 million.

No impairment assessment was performed for the years ended December 31, 2023 and 2022 as there was no indication of impairment.

13. LEASE ARRANGEMENTS

• a. Right-of-use assets

Right-of-use assets carrying amount Land Buildings Other equipment Additions to right-of-use assets Depreciation of right-of-use assets Land Buildings Other equipment		December 31	December 31
	2023 2022 $ 2,295 $ 2,623 400 800 1,951 4,878 $ 4,646 $ 8,301 **For the Year Ended December 31 **
		2023 $ - $ 328 400 2,927 $ 3,655	2022 $ 8,722 $ 274 400 2,826 $ 3,500

The Company did not have significant sublease or impairment of right-of-use assets during the years ended December 31, 2023 and 2022.

• 27 -

b. Lease liabilities

Lease liabilities carrying amount Current Non-current		**December 31 **	**December 31 **
		2023 $ 2,707 2,026 $ 4,733	2022 $ 3,624 4,732 $ 8,356

Discount rates for lease liabilities were as follows:

Land Buildings Other equipment c. Other lease information Expenses relating to low value asset leases Total cash outflow for leases	December 31	December 31	December 31
	2023 2022 2.20% 2.20% 1.15% 1.15% 2.60% 2.60% For the Year Ended December 31
		2023 $ 172 $ 3,942	2022 $ 148 $ 3,727

The Company leases of certain buildings qualify as short-term leases, and leases of certain office equipment qualify as low-value asset leases. The Company has elected to apply the recognition exemption for these leases and, thus, did not recognize right-of-use assets and lease liabilities for these leases.

d. Material leasing activities and terms (the Company is lessee)

The Company leases certain land, buildings and other equipment for operating uses with lease terms of 2 to 9 years. The Company does not have bargain purchase options to acquire the leasehold land, buildings and other equipment at the end of the lease terms.

14. COMPUTER SOFTWARE

Cost Accumulated amortization	For the Year Ended December 31, 2023	For the Year Ended December 31, 2023	For the Year Ended December 31, 2023
	Balance, Beginning of the Year $ 13,359 5,662 $ 7,697	Additions $ 1,852 $ 4,050	Disposals $ - $ -	Balance, End of the Year $ 15,211 9,712 $ 5,499

• 28 -

Cost Accumulated amortization	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022	For the Year Ended December 31, 2022
	Balance, Beginning of the Year $ 9,527 3,449 $ 6,078	Additions $ 5,098 $ 3,479	Disposals $ (1,266) $ (1,266)	Balance, End of the Year $ 13,359 5,662 $ 7,697

Computer software of the company are amortized on a straight-line basis over their estimated useful lives of 1-5 years.

15. BORROWINGS

a. Short-term borrowings

Letter of credit borrowings and export bills Line of credit borrowings Annual interest rate range (%) Letter of credit borrowings and export bills Line of credit borrowings		**December 31 **	**December 31 **
		2023 $ 2,181,078 3,500,000 $ 5,681,078 1.75-1.83 1.53-2.05	2022 $ 1,254,074 3,500,000 $ 4,754,074 1.18-6.21 1.22-1.83

• b. Long-term borrowings

Unsecured borrowings Line of credit borrowings Less: Current portion Long-term borrowings Annual interest rate range (%)		December 31	December 31
		2023 $ 2,315,477 (471,429) $ 1,844,048 1.66-1.74	2022 $ 2,042,857 (160,714) $ 1,882,143 1.43-1.80

The line of credit borrowings of the Company will be repaid in New Taiwan dollars. The borrowings are repayable in installments or paid in one lump sum upon maturity at varying amounts from January 2024 to August 2028.

16. BONDS PAYABLE

3rddomestic unsecured convertible bonds		December 31	December 31
		2023 $ 228,240	2022 $ 765,149

• 29 -

On December 15, 2020, the Company issued 5-year, 0% NTD-denominated unsecured convertible bonds in Taiwan for $1,000,000 thousand, and the maturity date of the bonds is December 15, 2025. Each bond entitles the holder to convert it into ordinary shares of the Company at a conversion price of $26.5, which shall be later adjusted in accordance with the formula started in the Anti-dilution provisions of the “ Rules and conditions of issuance and conversion of the 3[rd] domestic unsecured corporate bonds ” (as of December 31, 2023, the conversion price has been adjusted to $22.4). three months from the date of issuance of the convertible bonds (March 16, 2021) to 40 days before the maturity date (November 5, 2025), if the closing share price of the Company exceeds 30% of the prevailing conversion price for 30 consecutive business days or the outstanding balance falls lower than 10% of the original total issuance amount, the Company may redeem the bonds in cash at face value. In addition, holders may request to sell the bonds they hold back to the Company at any time within 30 days before the expiry of the third year from the date of issuance (December 15, 2023).

The convertible bonds contain both liability and equity components. The equity component was presented in equity under the heading of capital surplus - options. The effective interest rate of the liability component was 0.93% per annum on initial recognition.

As of December 31, 2023, the face value of the bonds payable converted by the holders was $767,600 thousand.

Changes in the master contract of the debt and sell-back rights of derivatives (recognized as financial liabilities at FVTPL - non-current) are as follows:

Balance at January 1 Amortization of discount this year Converted into ordinary shares this year Balance at December 31	Debt Instrument for Master Contracts	Debt Instrument for Master Contracts	Debt Instrument for Master Contracts
	For the Year Ended December 31
		2023 $ 765,149 6,790 (543,699) $ 228,240	2022 $ 775,775 7,156 (17,782) $ 765,149

Derivative instruments - put options (financial liabilities)

Balance at January 1 Changes in fair value Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 236 (236) $ -	2022 $ 966 (730) $ 236

• 30 -

17. OTHER PAYABLES

Payables for salaries and bonuses Payables for profit sharing bonus of employees and remuneration of directors Payables for acquisition of equipment Payables for commission Others		**December 31 **	**December 31 **
		2023 $ 83,024 - 55,131 2,761 69,931 $ 210,847	2022 $ 134,001 43,000 30,476 3,022 66,070 $ 276,569

18. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

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

b. Defined benefit plans

The defined benefit plan adopted by the Company in accordance with the Labor Standards Act is operated by the government of the ROC. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the 6 months before retirement. The Company contributes amounts equal to 5% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the Company assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Company is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the Bureau); the Company has no right to influence the investment policy and strategy.

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

Present value of defined benefit obligation Fair value of plan assets Net liabilities recognized in the parent company only balance sheets Other payables Net defined benefit liabilities		December 31	December 31
		2023 $ 120,739 (79,081) 41,658 (374) $ 41,284	2022 $ 127,195 (75,666) 51,529 (381) $ 51,148

• 31 -

Movements in net defined benefit liabilities were as follows:

					Net Liabilities	Net Liabilities
	Present Value of				Recognized in
	the Defined					the Parent
		Benefit	Fair Value of		Company only
		Obligation	the Plan Assets		Balance Sheets
Balance at January 1, 2023	$	127,195	$	(75,666)	$	51,529
Service cost
Current service cost		172		-		172
Net interest expense (income)		1,569		(956)		613
Recognized in profit or loss		1,741		(956)		785
Remeasurement
Return on plan assets (excluding
amounts included in net interest)		-		(727)		(727)
Actuarial loss - changes in financial
assumptions		489		-		489
Actuarial gain - experience adjustments		(5,674)		-		(5,674)
Recognized in other comprehensive
income		(5,185)		(727)		(5,912)
Contributions from the employer		-		(4,744)		(4,744)
Benefits paid		(3,012)		3,012		-
Balance at December 31, 2023	$	120,739	$	(79,081)	$	41,658
Balance at January 1, 2022	$	150,641	$	(79,000)	$	71,641
Service cost
Current service cost		287		-		287
Net interest expense (income)		1,035		(554)		481
Recognized in profit or loss		1,322		(554)		768
Remeasurement
Return on plan assets (excluding
amounts included in net interest)		-		(6,391)		(6,391)
Actuarial loss - changes in
demographic assumptions		57		-		57
Actuarial gain - changes in financial
assumptions		(6,339)		-		(6,339)
Actuarial gain - experience adjustments		(3,338)		-		(3,338)
Recognized in other comprehensive
income		(9,620)		(6,391)		(16,011)
Contributions from the employer		-		(4,869)		(4,869)
Benefits paid		(15,148)		15,148		-
Balance at December 31, 2022	$	127,195	$	(75,666)	$	51,529

Through the defined benefit plans under the Labor Standards Act, the Company is exposed to the following risks:

• 1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets shall not be below the interest rate for a 2-year time deposit with local banks.

• 2) Interest rate 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 plans’ debt investments.

• 32 -

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

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

Discount rate Expected rate of salary increase	December 31
	2023 2022 1.20% 1.25% 2.00% 2.00%

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 will increase (decrease) as follows:

Discount rate 0.25% increase 0.25% decrease Expected rate of salary increase/decrease 0.25% increase 0.25% decrease		December 31	December 31
		2023 $ (2,416) $ 2,492 $ 2,466 $ (2,403)	2022 $ (2,738) $ 2,828 $ 2,799 $ (2,725)

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

Expected contributions to the plans for next year Average duration of defined benefit obligation		December 31	December 31
		2023 $ 4,643 8 years	2022 $ 4,996 8 years

19. EQUITY

• a. Capital stock

Authorized shares (in thousands of shares) Authorized capital Issued and paid shares (in thousands of shares) Issued capital Registered capital (pending change)		December 31	December 31
		2023 660,000 $ 6,600,000 447,578 $ 4,475,783 $ 224,241	2022 660,000 $ 6,600,000 445,380 $ 4,453,799 $ -

The issued share has a par value of NT$10 per share and is entitled to one vote and the right to receive dividends.

• 33 -

b. Capital surplus

May be used to offset a deficit, distributed as cash dividends, or transferred to capital Additional paid-in capital Issuance of Convertible bonds Interest premium payable on convertible bonds May not be used for any purpose Share warrants of convertible bonds		December 31	December 31
		2023 $ 1,466,300 821,535 5,239 9,508 $ 2,302,582	2022 $ 1,466,300 501,394 5,239 32,175 $ 2,005,108

The capital surplus generated from the excess of the issuance price over the par value of capital stock, the conversion of bonds and interest premium payable on 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 transferred to share capital, limited to a certain percentage of the Company’s capital surplus and to once a year.

c. Retained earnings and dividend policy

Under the dividend policy as set forth in the amended articles of incorporation, where the Company made a profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit, setting aside or reversing a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan, which should be resolved in the stockholders’ meeting for the distribution of dividends and bonuses to stockholders. For the policies on the distribution of profit-sharing bonus of employees and remuneration of directors, refer to Note 21.

In line with the current and future development plans, the Company’s dividend policy stipulates that at least 50% of the accumulated unappropriated earnings should be distributed as dividends to shareholders, taking into consideration the investment environment, funding needs, and foreign and domestic competition. However, when the dividend is less than 0.5 dollars per share, the Company reserves the right to not distribute any dividends. Since the Company belongs to the traditional industry, and current operations have entered a mature and stable phase, cash dividends should take precedence over share dividends. In the case of the distribution of share dividends, the amount of cash dividends distributed should not be lower than 20% of the total dividends distributed.

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

In June 2022, the shareholders of the Company held a meeting and resolved to amend the Articles of the Company to specify that when the special reserve is allocated from the net deduction of other equity accumulated in the previous period, if the undistributed surplus in the previous period is insufficient to allocate, the post-tax income plus items other than the after-tax net income of the current period will be added to the undistributed surplus of the current period for the allocation.

• 34 -

The appropriations of earnings for 2022 and 2021, which were approved by the shareholders in their meetings in June 2023 and June 2022, respectively, were as follows:

Legal reserve appropriated Cash dividends Cash dividends per share (NT$)	**Appropriation of Earnings **	**Appropriation of Earnings **	**Appropriation of Earnings **
	For the Year Ended December 31
		2022 $ 53,970 $ 669,309 $ 1.5	2021 $ 126,576 $ 666,964 $ 1.5

The Company’s board of directors also proposed to distribute cash dividends of $1 per share from the capital surplus in the board of directors’ meeting on March 8, 2024, for a total of $470,002 thousand.

The loss appropriation will be resolved by the shareholders in their meeting to be held in June 2024.

20. NET REVENUE

Revenue from contracts with customers Revenue from sale of goods Other operating revenue Revenue from sale of electricity Contract balance December 31, 2023 Notes and trade receivables $ 742,777 Contract liabilities Sale of goods $ 419,149	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 13,591,612 32,440 $ 13,624,052 December 31, 2022 $ 848,806 $ 378,950	2022 $ 16,257,937 4,610 $ 16,262,547 January 1, 2022 $ 1,408,090 $ 518,204

21. NET PROFIT

a. Finance costs

Interest on borrowings Interest on short-term bills payable Interest on lease liabilities Interest on bonds payable	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 133,411 354 147 6,790 $ 140,702	2022 $ 71,341 30 107 7,156 $ 78,634

• 35 -

b. Other gains and losses

Rental income Dividend income Others	**For the Year Ended December 31 **	**For the Year Ended December 31 **	**For the Year Ended December 31 **
		2023 $ 60 14,038 4,424 $ 18,522	2022 $ 60 10,425 24,174 $ 34,659

c. Employee benefits expense, depreciation expense and amortization expense

Employee benefits expense Salaries expense Post-employment benefits Defined contribution plans Defined benefit plans Remuneration of directors Labor and health insurance expense Other employee benefits Depreciation expense Amortization expense	**For the Year Ended December 31 **	**For the Year Ended December 31 **
	2023 Operating Costs Operating Expenses Total $ 383,901 $ 119,373 $ 503,274 15,361 5,067 20,428 491 294 785 - 2,350 2,350 42,817 11,727 54,544 45,089 8,077 53,166 261,491 35,850 297,341 448 3,602 4,050	2022
		Operating Costs Operating Expenses Total $ 429,489 $ 167,176 $ 596,665 18,123 4,909 23,032 561 207 768 - 15,600 15,600 46,557 12,627 59,184 41,415 7,757 49,172 248,649 32,097 280,746 305 3,174 3,479

As of December 31, 2023 and 2022, the Company had 807 and 838 employees, respectively; and the number of directors not concurrently serving as employees was 6. The calculation basis is consistent with that for employee benefits expense.

As of December 31, 2023 and 2022, average employee benefits expense was $789 thousand and $876 thousand, respectively, and average employee salary expense was $628 thousand and $717 thousand, respectively. Average employee salary expense decreased by 12% compared to the previous year.

The principles of directors' remuneration and the payment of salary and traveling expenditures to directors shall follow the "Regulations for the Compensation of Directors and their Concurrently-Serving Functional Committees" and refer to the arms’ length range of the same industry.

The performance evaluation of the Company’s managerial officers not only considers the Company’s overall operating performance, future business risks and development trends of the industry, but also the individual’s performance achievement rate and contribution to the Company’s performance to grant the reasonable compensation. The payment shall be determined in compliance with the "Policies and Regulations of Salary and Compensation" and salary-related management regulations of the Company, which shall be sufficient to commend the responsibility and risk they bear.

The performance evaluation and reasonableness of the compensation for directors shall be reviewed and approved by the Compensation Committee and the Board of Directors, by referring to the salary level of the similar position in the same industry, and by considering the reasonableness of their compensation with their personal performance, the Company’s performance, and future business risks. The compensation system shall be reviewed from time to time in compliance with actual operating conditions and relevant laws and regulations, to pursue the balance between the Company's sustainable operation and risk control.

The compensation paid to employees is determined based on the provisions of the "Payroll Policy", and referred to the salary level of the similar position in the same industry, their responsibilities in the Company, and their contribution to the Company’s operating goals, to grant reasonable compensation.

• 36 -

• d. Profit sharing bonus of employees and remuneration of directors

The Articles of Incorporation of the Company were amended in June 2022. According to the provisions of the Articles of Incorporation, when the Company has a profit in the year, it should accrue employees’ profit-sharing and directors’ compensation at rates of 2%-6% and no higher than 2%, respectively, of net income before income tax. The Company incurred a loss for the fiscal year 2023; therefore, in accordance with the articles of association, it is not proposed to provide for employee and director remuneration. The profit-sharing bonuses of employees and remuneration of directors for the years ended December 31, 2022 was estimated as follows:

Profit sharing bonus of employees Remuneration of directors	For the Year Ended **December 31 **
	2022
	Accrual Rate Amount 4% $ 30,000 2% 13,000

If there is a change in the amounts after the annual parent company only financial statements were authorized for issuance, the differences will be recorded as a change in the accounting estimate in the following year.

There is no difference between the actual amounts of profit-sharing bonuses of employees and remuneration of directors paid and the amounts recognized in the parent company only financial statements for the years ended December 31, 2022 and 2021.

Information on the profit-sharing bonus of employees and remuneration of directors resolved by the board of directors of the Company is available on the Market Observation Post System website of the Taiwan Stock Exchange.

22. INCOME TAXES

• a. Major components of income tax expense (benefit) recognized in profit or loss

Current tax In respect of the current year Adjustments for prior years Deferred tax In respect of the current year Adjustments for prior years Income tax expense (benefit) recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 106,159 (10,060) 96,099 (157,502) (2,028) (159,530) $ (63,431)	2022 $ 327,595 639 328,234 (190,933) - (190,933) $ 137,301

• 37 -

A reconciliation of accounting profit and income tax expense (benefit) was as follows:

Income tax (benefit) expense calculated at the statutory rate Nondeductible expenses in determining taxable income Benefits not counted in tax Income tax adjustments on prior years Income tax (benefit) expense recognized in profit or loss	**For the Year Ended December 31 **	**For the Year Ended December 31 **	**For the Year Ended December 31 **
		2023 $ (46,649) 4,449 (9,143) (12,088) $ (63,431)	2022 $ 131,117 7,831 (2,286) 639 $ 137,301

b. Deferred tax assets and liabilities

Deferred tax assets Temporary differences Exchange differences on translating the financial statements of foreign operations Unrealized valuation gain on financial assets at FVTOCI Unrecognized gross profit of declared exports Refunded debts Unrealized gross profit on sales Defined benefit obligations Unrealized loss on inventories Payables for annual leave Unappropriated earnings of subsidiaries Others Deferred tax liabilities Temporary differences Allowance for impairment loss on trade receivables Others		For the Year Ended December 31, 2023
		Beginning Balance Recognized in Profit or Loss Recognized in Other Comprehensive Income $ 46,915 $ - $ 8,507 70,171 - - 3,381 1,935 - - 156 - - 824 - 10,306 (792) (1,182) 35,860 14,440 - 1,621 80 - 128,994 137,813 - 1,980 5,074 - $ 299,228 $ 159,530 $ 7,325 $ 1,724 $ - $ - 890 - - $ 2,614 $ - $ -	Ending Balance $ 55,422 70,171 5,316 156 824 8,332 50,300 1,701 266,807 7,054 $ 466,083 $ 1,724 890 $ 2,614

• 38 -

For the Year Ended December 31, 2022

Deferred tax assets Temporary differences Exchange differences on translating the financial statements of foreign operations Unrealized valuation gain (loss) on financial assets at FVTOCI Unrecognized gross profit of declared exports Defined benefit obligations Unrealized loss on inventories Payables for annual leave Unappropriated earnings of subsidiaries Others Deferred tax liabilities Temporary differences Unappropriated earnings of subsidiaries Allowance for impairment loss on trade receivables Others	Beginning Balance Recognized in Profit or Loss Recognized in Other Comprehensive Income $ 253,116 $ - $ (206,201) 73,760 - (3,589) 21,292 (17,911) - 14,328 (820) (3,202) 13,460 22,400 - 4,769 (3,148) - - 128,994 - - 1,980 - $ 380,725 $ 131,495 $ (212,992) $ 59,411 $ (59,411) $ - 1,724 - - 918 (28) - $ 62,053 $ (59,439) $ -	Ending Balance $ 46,915 70,171 3,381 10,306 35,860 1,621 128,994 1,980 $ 299,228 $ - 1,724 890 $ 2,614

• c. Income tax assessments

The tax returns through 2021 of the Company have been assessed by the tax authorities.

• 39 -

23. EARNINGS (LOSS) PER SHARE

Net Profit (Loss) Attributable to Owners of the Company For the Year Ended December 31, 2023 Basic loss per share Net loss for the year attributable to owners of the Company $ (169,815) Effect of potentially dilutive ordinary shares: Profit sharing bonus of employees - Convertible bonds - Diluted loss per share Net loss for the year attributable to owners of the Company plus effect of potentially dilutive ordinary shares $ (169,815) For the Year Ended December 31, 2022 Basic earnings per share Net income for the year attributable to owners of the Company $ 518,282 Effect of potentially dilutive ordinary shares: Profit sharing bonus of employees - Convertible bonds 5,141 Diluted earnings per share Net income for the year attributable to owners of the Company plus effect of potentially dilutive ordinary shares $ 523,423

Number of Earnings (Loss) Shares Per Share (In Thousands) (NT$) 447,983 $(0.38) - - 447,983 $(0.38) 445,190 $ 1.16 1,559 33,322 480,071 $ 1.09

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

The Company incurred a net loss in 2023; therefore, the dilutive effects of items such as employee compensation and convertible bonds, which have an anti-dilutive effect on earnings per share, were not considered.

24. CASH FLOW INFORMATION

a. Non-cash transactions

In addition to those disclosed in other notes, the Company entered into the following non-cash investing and financing activities which were not reflected in the financial statements of cash flows for the years ended December 31, 2023 and 2022:

• 40 -

The amount of cash paid for the acquisition of property, plant and equipment during the years ended December 31, 2023 and 2022, respectively, was as follows:

Purchase of property, plant and equipment Net changes in payables for acquisition of equipment Cash payments for property, plant and equipment	For the Year Ended December 31 2023 2022 $ 232,788 $ 345,894 (24,655) 29,234 $ 208,133 $ 375,128	For the Year Ended December 31 2023 2022 $ 232,788 $ 345,894 (24,655) 29,234 $ 208,133 $ 375,128	For the Year Ended December 31 2023 2022 $ 232,788 $ 345,894 (24,655) 29,234 $ 208,133 $ 375,128
		2023 $ 232,788 (24,655) $ 208,133	2022 $ 345,894 29,234 $ 375,128

• b. Changes in liabilities arising from financing activities

For the year ended December 31, 2023

Short-term bank borrowings Bonds payable Long-term bank borrowings (including current portion) Guarantee deposits received Lease liabilities	Beginning Balance $ 4,754,074 765,149 2,042,857 30,385 8,356 $ 7,600,821	Cash Flows $ 927,004 - 272,620 4,160 (3,770) $ 1,200,014		Non-cash Changes Exercise of Conversion Option Discount Amortization Financial Cost Amortization $ - $ - $ - (543,699 ) 6,790 - - - - - - - - - 147 $ (543,699) $ 6,790 $ 147	Ending Balance $ 5,681,078 228,240 2,315,477 34,545 4,733 $ 8,264,073

For the year ended December 31, 2022

Short-term bank borrowings Bonds payable Long-term bank borrowings(including current portion) Guarantee deposits received Lease liabilities	Beginning Balance $ 5,489,180 775,775 900,000 30,630 3,106 $ 7,198,691	Cash Flows $ (734,619 ) - 1,142,857 (245 ) (3,579) $ 404,414			Non-cash Changes	Financial Cost mortization $ - - - - 107 $ 107	Change in Exchange Rate $ (487 ) - - - - $ (487)	Ending Balance $ 4,754,074 765,149 2,042,857 30,385 8,356 $ 7,600,821
				Exercise of Conversion Option A $ - (17,782 ) - - - $ (17,782)	Discount mortization Increasing in Leasing A $ - $ - 7,156 - - - - - - 8,722 $ 7,156 $ 8,722

25. CAPITAL MANAGEMENT

The Company manages its capital to ensure that it will be able to continue as going concern while maximizing the return to shareholders through the optimization of the debt and equity balance. The Company’s overall strategy remains unchanged.

The capital structure of the Company consists of net debt (borrowings offset by cash) and equity of the Company (comprising issued capital, capital surplus, retained earnings, and other equity).

The Company is not subjected to any externally imposed capital requirements.

Key management personnel of the Company review the capital structure on a quarterly basis. As part of this review, the key management personnel of the Company consider the cost of capital and the risks associated with each class of capital. Based on the recommendations of the key management personnel, the Company expects to balance its capital structure through the payment of dividends, issuance of new shares, repurchase of shares and issuance of new debt or repayment of old debt.

• 41 -

26. FINANCIAL INSTRUMENTS

• a. Fair value

• 1) Fair value of financial instruments not measured at fair value

Management of the Company consider the carrying amounts of the Company’s financial instruments that are not measured at fair value as close to their fair values or their fair values could not be reasonably measured.

• 2) Fair value of financial instruments measured at fair value on a recurring basis

• a) Fair Value Hierarchy

The following analysis details the measurement of financial instruments since initial recognition. The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to which the fair value measurement inputs, are observable.

December 31, 2023 Financial assets at FVTPL Domestic listed shares Financial assets at FVTOCI Investments in equity instruments Domestic and foreign unlisted shares Investments in debt instruments Trade receivables December 31, 2022 Financial assets at FVTPL Domestic listed shares Financial assets at FVTOCI Investments in equity instruments Domestic and foreign unlisted shares Investments in debt instruments Trade receivables Financial liabilities at FVTPL Derivatives	Level 1 $ 198,000 1,430,127 - $ 1,628,127 $ 248,011 2,458,291 - $ 2,706,302 $ -	Level 2 $ - - - $ - $ - - - $ - $ -	Level 3 $ - 182,253 23,787 $ 206,040 $ - 182,253 12,047 $ 194,300 $ 236	Total $ 198,000 1,612,380 23,787 $ 1,834,167 $ 248,011 2,640,544 12,047 $ 2,900,602 $ 236

There were no transfers between Levels 1 and 2 for the years ended December 31, 2023 and 2022.

• 42 -

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

For the year ended December 31, 2023

Financial Assets Balance at January 1, 2023 Net increase in trade receivables Trade receivables factoring Balance at December 31, 2023 For the year ended December 31, 2022	Financial Assets at FVTOCI Equity Instruments Debt Instruments $ 182,253 $ 12,047 - 157,233 - (145,493) $ 182,253 $ 23,787	Total $ 194,300 157,233 (145,493) $ 206,040

Financial Assets at FVTOCI Financial Assets Equity Instruments Debt Instruments Total Balance at January 1, 2022 $ 164,311 $ 48,380 $ 212,691 Recognized in other comprehensive income (included in unrealized valuation gain (loss) on financial assets at FVTOCI) 17,942 - 17,942 Net increase in trade receivables - 37,240 37,240 Trade receivables factoring - (73,573) (73,573) Balance at December 31, 2022 $ 182,253 $ 12,047 $ 194,300 For the Year Ended December 31 Financial Liabilities at FVTPL 2023 2022 Derivatives Balance at January 1 $ 236 $ 966 Recognized in profit or loss (included in other gains and losses) (236) (730) Balance at December 31 $ - $ 236	Financial Assets at FVTOCI Financial Assets Equity Instruments Debt Instruments Total Balance at January 1, 2022 $ 164,311 $ 48,380 $ 212,691 Recognized in other comprehensive income (included in unrealized valuation gain (loss) on financial assets at FVTOCI) 17,942 - 17,942 Net increase in trade receivables - 37,240 37,240 Trade receivables factoring - (73,573) (73,573) Balance at December 31, 2022 $ 182,253 $ 12,047 $ 194,300 For the Year Ended December 31 Financial Liabilities at FVTPL 2023 2022 Derivatives Balance at January 1 $ 236 $ 966 Recognized in profit or loss (included in other gains and losses) (236) (730) Balance at December 31 $ - $ 236	Financial Assets at FVTOCI Financial Assets Equity Instruments Debt Instruments Total Balance at January 1, 2022 $ 164,311 $ 48,380 $ 212,691 Recognized in other comprehensive income (included in unrealized valuation gain (loss) on financial assets at FVTOCI) 17,942 - 17,942 Net increase in trade receivables - 37,240 37,240 Trade receivables factoring - (73,573) (73,573) Balance at December 31, 2022 $ 182,253 $ 12,047 $ 194,300 For the Year Ended December 31 Financial Liabilities at FVTPL 2023 2022 Derivatives Balance at January 1 $ 236 $ 966 Recognized in profit or loss (included in other gains and losses) (236) (730) Balance at December 31 $ - $ 236	Financial Assets at FVTOCI Financial Assets Equity Instruments Debt Instruments Total Balance at January 1, 2022 $ 164,311 $ 48,380 $ 212,691 Recognized in other comprehensive income (included in unrealized valuation gain (loss) on financial assets at FVTOCI) 17,942 - 17,942 Net increase in trade receivables - 37,240 37,240 Trade receivables factoring - (73,573) (73,573) Balance at December 31, 2022 $ 182,253 $ 12,047 $ 194,300 For the Year Ended December 31 Financial Liabilities at FVTPL 2023 2022 Derivatives Balance at January 1 $ 236 $ 966 Recognized in profit or loss (included in other gains and losses) (236) (730) Balance at December 31 $ - $ 236
		2023 $ 236 (236) $ -	2022 $ 966 (730) $ 236

• c) Valuation techniques and inputs applied for Level 3 fair value measurement

Financial Instrument Valuation Technique and Inputs

Foreign unlisted shares in Discounted cash flow: equity instruments

Consideration of long-term revenue growth rate, long-term pre-tax operating profit margin, weighted average cost of capital (WACC), liquidity discount and other factors, and calculate the present value of expected returns from holding this investment.

Market approach:

In the market approach, the selling price of comparable companies was used to estimate the fair value of the target asset through comparison, analysis and adjustments.

• 43 -

Financial Instrument Factored trade receivables Financial liabilities at FVTPL	Valuation Technique and Inputs
	As the effect of discounting is not significant, the fair value is measured based on the original invoice amount. The binomial tree evaluation model of convertible bonds:

Consideration of the duration, the share price and volatility of the convertible bond object, conversion price, risk-free interest rate, discount rate, liquidity risk of the convertible bonds and other factors

• b. Categories of financial instruments

Financial assets FVTPL Mandatorily classified as at FVTPL Amortized cost FVTOCI Equity instruments Trade receivables Financial liabilities Amortized cost FVTPL Derivatives	December 31
	2023 2022 $ 198,000 $ 248,011 1,643,017 1,566,514 1,612,380 2,640,544 23,787 12,047 8,582,985 8,044,418 - 236

The balances include financial assets at amortized cost, which comprise cash, notes receivable, trade receivables, other receivables, pledged time deposits (recognized as other current assets) and refundable deposits.

The balances include financial liabilities at amortized cost, which comprise short-term and long-term bank borrowings (including current portion of long-term borrowings), notes payable, trade payables, other payables, bonds payable and guarantee deposits.

• c. Financial risk management objectives and policies

The Company’s major financial instruments include equity, trade receivables, trade payables, borrowings, and lease liabilities. The Company’s financial department 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 (including foreign currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

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

• 44 -

The finance department reports quarterly to the management, an independent body that monitors risks and implements to mitigate risk exposures .

1) Market risk

The Company’s activities exposed it primarily to the financial risks of changes in foreign currency exchange rates and interest rates.

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

a) Foreign currency risk

The Company enters into foreign currency-denominated sales and purchases, which expose the Company to foreign currency risk.

The carrying amounts of the Company’s foreign currency-denominated monetary assets and monetary liabilities and of the derivatives exposed to foreign currency risk at the end of the year are set out in Note 30.

Sensitivity analysis

The Company is mainly exposed to the USD.

The following table details the Company’s sensitivity to a 1% increase and decrease in the NTD against the relevant foreign currencies. The sensitivity rate used when reporting foreign currency risk internally to key management personnel and representing management’s assessment of the reasonably possible change in foreign exchange rates is 1%. The sensitivity analysis included only outstanding foreign currency-denominated monetary items and foreign exchange forward contracts designated as cash flow hedges and adjusted their translation at the end of the year for a 1% change in foreign currency rates. A positive number below indicates an increase in profit (loss) before income tax associated with the NTD strengthening by 1% against the relevant currency. For a 1% weakening of the NTD against the relevant currency, there would be an equal and opposite impact on profit (loss) before income tax, and the balances below would be negative.

NTD/USD b) Interest rate risk	Impact on profit or loss
	For the Year Ended December 31
	2023 2022 $ 11,166 $ 9,093

The Company was exposed to interest rate risk because the Company borrows funds at both fixed and floating interest rates. The risk is managed by the Company by maintaining an appropriate mix of fixed and floating rate borrowings and using interest rate swap contracts and forward interest rate contracts. Hedging activities are evaluated regularly to align with interest rate views and defined risk appetites ensuring the most cost-effective hedging strategies are applied.

• 45 -

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

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities Sensitivity analysis	December 31
	2023 2022 $ 2,100 $ 2,100 232,973 773,505 430,065 485,353 7,996,555 6,796,931

The sensitivity analysis below was determined based on the Company’s exposure to interest rates for non-derivative instruments at the end of the year. For floating rate liabilities, the analysis was prepared assuming the amount of each liability outstanding at the end of the year was outstanding for the whole year. A 0.1% increase or decrease in interest rates is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

If interest rates had been 0.1% higher/lower and all other variables were held constant, the Company’s profit (loss) before income tax for the years ended December 31, 2023 and 2022 would have decreased/increased by $7,566 thousand and $6,312 thousand, respectively.

c) Other price risk

The Company was exposed to equity price risk through its investments in equity securities. The Company manages this exposure by maintaining a portfolio of investments with different risk.

Sensitivity analysis

The sensitivity analysis below was determined based on the exposure to equity price risks at the balance sheet date.

If equity prices had been 1% higher or lower, pre-tax profit (loss) for the year ended December 31, 2023 and 2022 would have changed by $1,980 thousand and $2,480 thousand, 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 Company. At the balance sheet date, the Company’s maximum exposure to credit risk, which would cause a financial loss to the Company due to the failure of the counterparty to discharge its obligation and due to the financial guarantees provided by the Company, could be equal to the carrying amount of the respective recognized financial assets as stated in the balance sheets.

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. The Company uses other publicly available financial information and its own trading records to rate its major customers. The Company continuously monitors its exposure to credit risk and the credit ratings of its counterparties and allocates the total transaction amount among the creditworthy customers. The Company’s management also controls credit risk by reviewing the credit limits of its counterparties on an annual basis.

• 46 -

The Company also continuously evaluates the financial status of the customers of the trade receivables, and purchases credit guarantee insurance contracts when necessary.

3) Liquidity risk

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

The Company relies on bank borrowings as a significant source of liquidity. As of December 31, 2023 and 2022, the amount of unused financing facilities was as follows:

Amount of unused bank financing facilities		December 31	December 31
		2023 $ 13,575,151	2022 $ 13,975,779

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

As the Company has sufficient operating capital, there is no liquidity risk from inability to raise funds to satisfy performance obligations.

The following table details the Company’s remaining contractual maturities for its non-derivative financial liabilities with agreed upon repayment periods.

Less than 1 Year December 31, 2023 Non-interest bearing liabilities $ 323,645 Lease liabilities 2,771 Floating interest rate liabilities 6,152,507 Fixed interest rate liabilities - $ 6,478,923 December 31, 2022 Non-interest bearing liabilities $ 451,953 Lease liabilities 3,771 Floating interest rate liabilities 4,914,788 Fixed interest rate liabilities - $ 5,370,512	1-5 Years $ - 2,160 1,844,048 232,400 $ 2,078,608 $ - 4,931 1,882,143 786,400 $ 2,673,474	Total $ 323,645 4,931 7,996,555 232,400 $ 8,557,531 $ 451,953 8,702 6,796,931 786,400 $ 8,043,986

• 47 -

d. Transfers of financial assets

Factored trade receivables that are not yet overdue at the end of the year were as follows:

Counterparty Receivables Factoring Proceeds Amount Reclassified to Other Receivables Advances Received Unused Advances Received Used Annual Interest Rates on Advances Received (Used)	Counterparty Receivables Factoring Proceeds Amount Reclassified to Other Receivables Advances Received Unused Advances Received Used Annual Interest Rates on Advances Received (Used)	Counterparty Receivables Factoring Proceeds Amount Reclassified to Other Receivables Advances Received Unused Advances Received Used Annual Interest Rates on Advances Received (Used)	Counterparty Receivables Factoring Proceeds Amount Reclassified to Other Receivables Advances Received Unused Advances Received Used Annual Interest Rates on Advances Received (Used)	Counterparty Receivables Factoring Proceeds Amount Reclassified to Other Receivables Advances Received Unused Advances Received Used Annual Interest Rates on Advances Received (Used)	Counterparty Receivables Factoring Proceeds Amount Reclassified to Other Receivables Advances Received Unused Advances Received Used Annual Interest Rates on Advances Received (Used)
December 31, 2023
Fubon bank	$ 467,748	$ 458,742	$ 411,967	$ 9,006	2M TAFIX3
	(USD 15,234)	(USD 14,940)	(USD 13,417)	(USD 293)	+0.25%
December 31, 2022
Fubon bank	$ 356,417	$ 217,211	$ 161,699	$ 139,205	2M TAFIX3
	(USD 11,606)	(USD 7,073)	(USD 5,265)	(USD 4,533)	+0.25%

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

27. TRANSACTIONS WITH RELATED PARTIES

• a. Categories of related parties

Related Party YC INOX TR Company Chi Mao Company Tai Chyang Investment Co., Ltd. Chin Ying Fa Mechanical Ind Co., Ltd.	Relationship with the Company
	Subsidiary Subsidiary Other related party Other related party

• b. Sales revenue

Subsidiaries Other related parties	**For the Year Ended December 31 **	**For the Year Ended December 31 **	**For the Year Ended December 31 **
		2023 $ - 2,814 $ 2,814	2022 $ 92,827 2,944 $ 95,771

The sales price and receivable terms for related parties are not significantly different from those of non-related parties.

• c. Costs of goods sold

Subsidiaries	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 6,813	2022 $ -

• 48 -

The purchase price and payment terms from related parties are not significantly different from those of non-related parties.

• d. Receivables from related parties

Line Item Related Party Category Trade receivables Other related parties		December 31	December 31
		2023 $ 681	2022 $ 544

e. Other income Subsidiaries Other related parties	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 66 30 $ 96	2022 $ 66 30 $ 96

• f. Remuneration of key management personnel

Remuneration of key management personnel was as follows:

Short-term employee benefits Post-employment benefits	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2023 $ 21,887 344 $ 22,231	2022 $ 51,977 388 $ 52,365

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

28. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets were provided as collateral for usage of natural gas and construction:

Pledged time deposits (classified as other current assets)		December 31	December 31
		2023 $ 2,100	2022 $ 2,100

29. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

Significant contingencies and unrecognized commitments of the Company as of December 31, 2023 and 2022 were as follows:

• a. As of December 31, 2023 and 2022, unused letters of credit for purchases of raw materials amounted to $140,437 thousand and $479,217 thousand, respectively.

• b. As of December 31, 2023 and 2022, unpaid contracts for purchases of raw materials and equipment amounted to $593,943 thousand and $962,428 thousand, respectively.

• 49 -

30. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The following information was aggregated by the foreign currencies other than the functional currencies of the Company and the exchange rates between the foreign currencies and the respective functional currencies were disclosed. The significant financial assets and liabilities denominated in foreign currencies were as follows:

Monetary items Financial assets USD Financial liabilities USD Non-monetary items Investments accounted for using the equity method TRY	**December 31 **	**December 31 **
	2023 Foreign Currency Exchange Rate New Taiwan Dollars $ 36,416 30.705 $ 1,118,147 51 30.705 1,560 5,700,329 1.044 5,947,025	2022
		Foreign Currency Exchange Rate New Taiwan Dollars $ 32,040 30.71 $ 983,951 2,431 30.71 74,669 3,076,329 1.643 5,044,831

The significant foreign exchange gains (losses) (including realized and unrealized) were as follows:

Functional Currency USD	For the Year Ended December 31	For the Year Ended December 31
	2023 Exchange Rate (Functional Currency: Presentation Currency) Net Foreign Exchange Gains (Losses) 30.705 (USD:NTD) $ 38,609	2022
		Exchange Rate (Functional Currency: Presentation Currency) Net Foreign Exchange Gains (Losses) 30.71 (USD:NTD) $ 151,664

31. SEPARATELY DISCLOSED ITEMS

• a. Information on significant transactions:

• 1) Financing provided to others (Table 1)

• 2) Endorsements/guarantees provided (Table 2)

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

• 4) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital (Table 4)

• 5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in capital (None)

• 6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital (None)

• 50 -

• 7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital (None)

• 8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital (None)

• 9) Trading in derivative instruments (None)

• 10) Other (None)

• b. Information on investees (Table 5)

• c. Information on investments in mainland China (None)

• d. Information of major shareholders: list all shareholders with ownership of 5% or greater showing the name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder (Table 6)

• 51 -

TABLE 1

YC INOX CO., LTD. AND SUBSIDIARIES

FINANCING PROVIDED TO OTHERS FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars and Foreign Currency)

No. (Note 1)	Lender	Borrower	Financial Statement Account	Related Party	Highest Balance for the Period (Note 3)	Ending Balance (Note 3)	Actual Amount Borrowed	Interest Rate (%)	Nature of Financing	Business Transaction Amount	Reasons for Short-term Financing	Allowance for Impairment Loss	**Collateral **	**Collateral **	Financing Limit for Each Borrower (Note 2)	Aggregate Financing Limit (Note 2)	Note
													Item	Value
0	The Company	YC INOX TR Company	Other receivables- related party	Y	$ 1,621,250 (USD 50,000)	$ 1,535,250 (USD 50,000)	$ -	7.67%	Short-term financing	$ -	Operation	$ -	-	$ -	$ 1,790,033	$ 3,580,067

Note 1: 0 represents the parent company.

Note 2: The financing limit for each borrower and aggregate financing limit are 20% and 40%, respectively, of the net assets of the Company.

Note 3: If the relevant figures in this table involve foreign currencies, they shall be converted into the New Taiwan dollar at the exchange rate on the balance sheet date.

• 52 -

TABLE 2

YC INOX CO., LTD. AND SUBSIDIARIES

ENDORSEMENTS/GUARANTEES PROVIDED FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars and Foreign Currency)

No. (Note 1)	Endorser/ Guarantor	Endorsee/Guarantee	Endorsee/Guarantee	Limit on Endorsement/ Guarantee Given on Behalf of Each Party (Note 2)	Maximum Amount Endorsed/ Guaranteed During the Period (Note 3)	Outstanding Endorsement/ Guarantee at the End of the Period (Note 3)	Actual Amount Borrowed	Amount Endorsed/ Guaranteed by Collateral	Ratio of Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements (%)	Aggregate Endorsement/ Guarantee Limit (Note 2)	Endorsement/ Guarantee Given by Parent on Behalf of Subsidiaries	Endorsement/ Guarantee Given by Subsidiaries on Behalf of Parent	Endorsement/ Guarantee Given on Behalf of Companies in Mainland China	Note
		Name	Relationship
0	The Company	YC INOX TR Company	Subsidiary	$ 1,790,033	$ 324,250 (USD 10,000)	$ 307,050 (USD 10,000)	$ 5,805	$ -	3.43	$ 3,580,067	Y	-	-	-

Note 1: 0 represents the parent company.

Note 2: The financing limit for each borrower and aggregate financing limit are 20% and 40%, respectively, of the net assets of the Company.

Note 3: If the relevant figures in this table involve foreign currencies, they shall be converted into the New Taiwan dollar at the exchange rate on the balance sheet date.

• 53 -

TABLE 3

YC INOX CO., LTD. AND SUBSIDIARIES

MARKETABLE SECURITIES HELD DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars and Shares)

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2023	December 31, 2023
				Number of Shares/Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
The Company Chi Mao Company	Ordinary Shares Ta Chen Stainless Pipe Co., Ltd AltruBio Inc. Gongwin Biopharm Holdings Co., Ltd. Preference Shares AltruBio Inc. - Series A-2 Ordinary Shares AltruBio Inc. Gongwin Biopharm Holdings Co., Ltd. Preference Shares AltruBio Inc. - Series A-1	None None None None None None None	Financial assets at FVTPL - current Financial assets at FVTOCI - non-current Financial assets at FVTOCI - non-current Financial assets at FVTOCI - non-current Financial assets at FVTOCI - non-current Financial assets at FVTOCI - non-current Financial assets at FVTOCI - non-current	5,000 11,051 7,910 20,426 560 871 15,915	$ 198,000 63,987 1,430,127 118,266 3,242 157,462 92,150	0.21 9.31 6.98 23.00 0.47 0.77 4.74	$ 198,000 63,987 1,430,127 118,266 3,242 157,462 92,150

• 54 -

TABLE 4

YC INOX CO., LTD AND SUBSIDIARIES

MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2023

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

Company Name	Type and Name of Marketable Securities	Financial Statement Account	Counterparty	Relationship	Beginning Balance (Note 2)	Beginning Balance (Note 2)	Acquisition (Note 3)	Acquisition (Note 3)		Disposal	Disposal		Ending Balance (Note 2)	Ending Balance (Note 2)
					Number of Shares	Amount	Number of Shares	Amount	Number of Shares	Amount	Carrying Amount	Gain (Loss) on Disposal	Number of Shares	Amount
The Company	Ordinary shares (Note 1)	Investment accounted for using the equity method	YC INOX TR Company	Subsidiary	2,552	$ 5,044,831	1,133	$ 1,628,341	-	$ -	$ -	$ -	3,685	$ 5,947,025

Note 1: YC INOX TR Company’s ordinary shares have a par value of TRY 1,000 thousand.

Note 2: The balance included the share of profit or loss from investments in subsidiaries accounted for using the equity method and exchange differences on translating foreign operations.

Note 3: Refer to Note 11 of financial statements.

• 55 -

TABLE 5

YC INOX CO., LTD. AND SUBSIDIARIES

INFORMATION ON INVESTEES FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars, Unless Specified Otherwise)

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount	Original Investment Amount	As of	December 31, 2023	December 31, 2023	Net Income (Loss) of the Investee	Share of Profit (Loss)
				December 31, 2023	December 31, 2022	Number of Shares	%	Carrying Amount
The Company	Chi Mao Company YC INOX TR Company	Shijou Township, Chang-Hwa County, Taiwan Turkey	Investment Manufacturing and distribution of stainless steel tubes/pipes and sheets/coils	$ 100,120 7,562,295	$ 100,120 5,933,954	10,000,000 3,685	100 100	$ 190,698 5,947,025	$ (1,785) (689,068)	$ (1,785) (689,068)

• 56 -

TABLE 6

YC INOX CO., LTD

INFORMATION OF MAJOR SHAREHOLDERS DECEMBER 31, 2023

Name of Major Shareholder	Shares
	Number of Shares Held	Percentage of Ownership(%)
Tai Chyang Investment Co., Ltd. Chang, Chin-Peng	61,209,508 26,030,000	13.02 5.53

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

• 57 -

THE CONTENTS OF STATEMENTS OF MAJOR ACCOUNTING ITEMS

ITEM STATEMENT	INDEX
MAJOR ACCOUNTING ITEMS IN ASSETS, LIABILITIES AND
EQUITY
STATEMENT OF CASH	1
STATEMENT OF CHANGES IN FINANCIAL ASSETS AT	Note 7/Table 3
FAIR VALUE THROUGH PROFIT OR LOSS - CURRENT
STATEMENT OF NOTES RECEIVABLE	2
STATEMENT OF TRADE RECEIVABLES	3
STATEMENT OF OTHER RECEIVABLES	4
STATEMENT OF INVENTORIES	5
STATEMENT OF CHANGES IN FINANCIAL ASSETS AT	Note 8/Table 3
FAIR VALUE THROUGH OTHER COMPREHENSIVE
INCOME - NON-CURRENT
STATEMENT OF CHANGES IN INVESTMENTS	6
ACCOUNTED FOR USING THE EQUITY METHOD
STATEMENT OF CHANGES IN PROPERTY, PLANT AND	Note 12
EQUIPMENT
STATEMENT OF CHANGES IN ACCUMULATED	Note 12
DEPRECIATION OF PROPERTY, PLANT AND
EQUIPMENT
STATEMENT OF CHANGES IN RIGHT-OF-USE ASSETS	7
STATEMENT OF CHANGES IN COMPUTER SOFTWARE	Note 14
STATEMENT OF OTHER NON-CURRENT ASSETS	8
STATEMENT OF DEFERRED TAX ASSETS	Note 22
STATEMENT OF SHORT-TERM BORROWINGS	9
STATEMENT OF TRADE PAYABLES	10
STATEMENT OF OTHER PAYABLES	Note 17
STATEMENT OF LONG-TERM BORROWINGS	11
STATEMENT OF LEASE LIABILITIES	12
STATEMENT OF DEFERRED TAX LIABILITIES	Note 22
MAJOR ACCOUNTING ITEMS IN PROFIT OR LOSS
STATEMENT OF NET REVENUE	13
STATEMENT OF COST OF GOODS SOLD	14
STATEMENT OF OPERATING EXPENSES	15
STATEMENT OF EMPLOYEE BENEFITS, DEPRECIATION	Note 21
AND AMORTIZATION BY FUNCTION

• 58 -

STATEMENT 1

YC INOX CO., LTD.

STATEMENT OF CASH DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Item Cash on hand Cash in banks Checking account deposits Demand deposits Foreign deposits (Note)	Amount $ 1,220 158 127,156 302,909 $ 431,443

Note: Including US$9,044 thousand and EUR$742 thousand. The exchange rates are US1=NT$30.705, and EUR1=NT$33.98.

• 59 -

STATEMENT 2

YC INOX CO., LTD.

STATEMENT OF NOTES RECEIVABLE DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Item LXX108 LXX524 Others (Note)	Amount $ 12,164 3,428 58,852
	$ 74,444

Note: The amount from each client included in others does not exceed 5% of the account balance.

• 60 -

STATEMENT 3

YC INOX CO., LTD.

STATEMENT OF TRADE RECEIVABLES DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Client Name LXX466 FXX004 FXX032 Others (Note) Less: Allowance for impairment loss	Amount $ 46,235 41,674 33,807 548,859 (2,242) $ 668,333

Note: The amount from each client included in others does not exceed 5% of the account balance.

• 61 -

STATEMENT 4

YC INOX CO., LTD.

STATEMENT OF OTHER RECEIVABLES DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Item Factored receivables Value-added tax refund receivables Others	Amount $ 458,742 31,500 98 $ 490,340

• 62 -

STATEMENT 5

YC INOX CO., LTD.

STATEMENT OF INVENTORIES DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Item Raw materials Work in progress Semi-manufactured goods Finished goods Merchandise Less: Allowance for loss on inventory valuation		Amount	Amount
		Cost $ 1,064,537 59,821 360,460 1,804,124 12,602 3,301,544 (251,500) $ 3,050,044	Net Realizable Value (Note) $ 931,437 57,821 310,060 1,738,324 12,402 $ 3,050,044

Note: Inventories are stated at the lower of cost and net realizable value and compared on an item-by-item basis.

• 63 -

STATEMENT 6

YC INOX CO., LTD.

STATEMENT OF CHANGES IN INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars, Unless Specified Otherwise)

Name Chi Mao Company YC INOX TR Company	Beginning Balance	Beginning Balance	Acquisition Number of Shares Amount Profit and (Loss) on Investments - $ - $ (1,785) 1,133 1,628,341 (689,068) $ 1,628,341 $ (690,853)	Exchange Unrealized Differences on Valuation Translating Gain (Loss) on Foreign Operations Financial Assets at FVTOCI $ - $ (113,204) (42,538) - $ (42,538) $ (113,204)	Realized (Unrealized) Sales Revenue $ - 5,459 $ 5,459	Exchange of Financial Statements of Foreign Operations Shareholding Number of Shares Percentage (%) Amount 10,000,000 100 $ 190,698 3,685 100 5,947,025 $ 6,137,723	Market Value or Net Equity $ 190,698 5,947,025 $ 6,137,723
						Shareholding Number of Shares Percentage (%) 10,000,000 100 3,685 100
	Number of Shares 10,000,000 2,552	Amount $ 305,687 5,044,831 $ 5,350,518	Number of Shares - 1,133

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STATEMENT 7

YC INOX CO., LTD.

STATEMENT OF CHANGES IN RIGHT-OF-USE ASSETS FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Cost Land Buildings Other equipment Accumulated Depreciation Land Buildings Other equipment	Beginning Balance $ 2,869 2,000 5,853 10,722 246 1,200 975 2,421 $ 8,301	Additions $ - - - $ - $ 328 400 2,927 $ 3,655	Disposals $ - - - $ - $ - - - $ -	Ending Balance $ 2,869 2,000 5,853 10,722 574 1,600 3,902 6,076 $ 4,646

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STATEMENT 8

YC INOX CO., LTD.

STATEMENT OF OTHER NON-CURRENT ASSETS DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Item Decorations Refundable deposits	Amount $ 51,361 144 $ 51,505

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STATEMENT 9

YC INOX CO., LTD.

STATEMENT OF SHORT-TERM BORROWINGS DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Credit Type and Bank Maturity Date (Note) Annual Interest Rate Range (%) Letter of credit borrowings and export bills Yuanta Commercial Bank Co., Ltd. Taichung Branch 2024.02.06 E. Sun Bank Taichung Branch 2024.03.12 Bank of Taiwan Yuan-Lin Branch 2024.03.22 Mega International Commercial Bank South Chunghwa Branch 2024.03.28 1.75-1.83 Far East National Bank Tainan Branch 2024.04.03 Chang Hwa Commercial Bank Yuan-Lin Branch 2024.04.15 Branch Taiwan Cooperative Bank Yuan-Lin Branch 2024.05.22 Hua Nan Commercial Bank Yuan-Lin Branch 2024.06.12 Line of Credit Borrowings Far East National Bank Tainan Branch 2024.02.07 Yuanta Commercial Bank Co., Ltd. Taichung Branch 2024.02.20 Branch HSBC Bank Taichung Branch 2024.02.26 Bank of Taiwan Yuan-Lin Branch 2024.03.14 Chang Hwa Commercial Bank Yuan-Lin Branch 2024.03.25 1.53-2.05 Mega International Commercial Bank South Chunghwa Branch 2024.03.28 Taipei Fubon Bank Zhong-Gang Branch 2024.05.20 Taiwan Cooperative Bank Yuan-Lin Branch 2024.05.23 The Export-Import Bank of the Republic of China Taichung Branch 2024.11.02

Amount $ 199,770 332,330 48,640 103,137 199,226 299,782 383,876 614,317 2,181,078 300,000 100,000 400,000 500,000 400,000 300,000 800,000 200,000 500,000 3,500,000 $ 5,681,078

Note: Shown maturity date is the last maturity date of all the loans.

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STATEMENT 10

YC INOX CO., LTD.

STATEMENT OF TRADE PAYABLES DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Client Name LXX174 Others (Note)	Amount $ 24,261 88,043 $ 112,304

Note: The amount from each client included in others does not exceed 5% of the account balance.

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STATEMENT 11

YC INOX CO., LTD.

STATEMENT OF LONG-TERM BORROWINGS DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Credit Type and Bank Loan Period Repayment Method Annual Interest Rate (%) Current Portion Unsecured Borrowings Bank of Taiwan Yuan-Lin Branch 2022.11.04-2025.10.27 Interest payable monthly, one-time repayment of principal in full on the maturity date $ - 〃 2023.10.25-2026.10.25 Interest payable monthly, one-time repayment of principal in full on the maturity date - Export-Import Bank of the Republic of China Taichung Branch 2020.03.31-2025.03.31 Interest payable quarterly, the principal has been amortized on an average half-year basis 57,143 〃 2021.09.24-2026.09.24 Interest payable quarterly, the principal has been amortized on an average half-year basis 28,572 〃 2021.10.26-2026.10.26 Interest payable quarterly, the principal has been amortized on an average half-year basis 28,572 〃 2022.01.19-2027.01.19 Interest payable quarterly, the principal has been amortized on an average half-year basis 28,571 〃 2022.01.27-2027.01.27 Interest payable quarterly, the principal has been amortized on an average half-year basis 28,571 〃 2022.03.18-2027.03.18 Interest payable quarterly, the principal has been amortized on an average half-year basis 28,571 〃 2022.04.25-2027.04.25 Interest payable quarterly, the principal has been amortized on an average half-year basis 28,571 〃 2022.04.28-2027.04.28 Interest payable quarterly, the principal has been amortized on an average half-year basis 1.66-1.74 28,571 〃 2022.11.21-2027.11.21 Interest payable quarterly, the principal has been amortized on an average half-year basis 14,287 〃 2023.08.07-2028.08.07 Interest payable monthly, one-time repayment of principal in full on the maturity date - Hua Nan Commercial Bank Yuan-Lin Branch 2021.10.25-2024.10.25 Interest payable monthly, one-time repayment of principal in full, one year after the maturity date 100,000 〃 2022.02.21-2025.02.21 Interest payable monthly, one-time repayment of principal in full on the maturity date - 〃 2022.11.09-2025.11.09 Interest payable monthly, one-time repayment of principal in full on the maturity date - 〃 2023.07.06-2026.07.06 Interest payable monthly, one-time repayment of principal in full on the maturity date - 〃 2023.08.15-2026.08.15 Interest payable monthly, one-time repayment of principal in full on the maturity date - E. Sun Bank 2023.05.09-2026.05.19 Interest payable monthly, the principal has been amortized on a quarterly basis 100,000 $ 471,429	Maturity after One Year $ 200,000 400,000 28,572 57,143 57,143 71,429 71,429 71,429 71,429 71,429 85,713 100,000 - 100,000 100,000 100,000 100,000 158,332 $ 1,844,048	Total $ 200,000 400,000 85,715 85,715 85,715 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 258,332 $ 2,315,477

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STATEMENT 12

YC INOX CO., LTD.

STATEMENT OF LEASE LIABILITIES DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Item	Lease Period	Discount Rate (%) Ending	Discount Rate (%) Ending	Balance
Land	2022.04-2030.12	2.20	$	2,338
Building	2020.01-2024.12	1.15		410
Other equipment	2022.09-2024.08	2.60		1,985
			$	4,733

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STATEMENT 13

YC INOX CO., LTD.

STATEMENT OF NET REVENUE FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Quantity Item (Tons) Revenue from sale of commodities Stainless Steel Tubes/Pipes 74,048 Stainless Steel Sheets/Coils 58,655 Others 2,383 Other operating income Revenue from sale of electricity -	Amount $ 8,192,834 5,164,989 233,789 32,440 $ 13,624,052

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STATEMENT 14

YC INOX CO., LTD.

STATEMENT OF COST OF GOODS SOLD FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Item Cost of goods purchased Goods at the beginning of the year Add: Purchases this year Transferred from materials Less: Others Goods at the end of the year Total cost of goods purchased Cost of produced goods Raw materials at the beginning of the year Add: Materials purchased this year Others Less: Transferred to goods Raw materials at the end of the year Raw materials used Direct labor Manufacturing expenses Manufacturing cost Add: Work in process at the beginning of the year Transferred from finished goods Transferred from semi-finished goods Less: Others Work in process at the end of the year Add: Semi-finished goods at the beginning of the year Others Less: Transferred to work in process Semi-finished goods at the end of the year Cost of finished goods Add: Finished goods at the beginning of the year Less: Transferred to work in process Others Finished goods at the end of the year Cost of produced goods sold Processing cost Sales of scraps Inventory surplus Loss on write-down of inventories Cost of electricity sold Cost of goods sold

Amount $ 18,050 146,663 261,300 (7,218) (12,602) $ 406,193 1,555,548 10,040,097 6,358 (261,300) (970,004) 10,370,699 188,663 1,051,329 11,610,691 65,163 3,734,651 6,642,413 (11,853) (59,821) 361,523 48,345 (6,642,412) (360,460) 15,388,240 2,259,297 (3,734,651) (4,531) (1,804,124) 12,104,231 1,314 (123,861) 15,231 72,200 8,931 $ 12,484,239

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STATEMENT 15

YC INOX CO., LTD.

STATEMENT OF OPERATING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2023 (In Thousands of New Taiwan Dollars)

Item Selling and Marketing Expenses General and Administrative Expenses Salary $ 47,548 $ 77,186 Freight 254,109 18 Depreciation 5,060 30,790 Entertainment fees 909 18,484 Commissions 10,181 - Import and export fees 111,400 - Others 22,502 60,890 $ 451,709 $ 187,368	Total $ 124,734 254,127 35,850 19,393 10,181 111,400 83,392
	$ 639,077

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