Y.C.C. — Audit Report / Information 2020

Nov 14, 2020

Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND

INDEPENDENT AUDITORS’ REPORT

DECEMBER 31, 2020 AND 2019

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For the convenience of readers and for information purpose only, the auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. In the event of any discrepancy between the English version and the original Chinese version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and financial statements shall prevail.

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Y.C.C. PARTS MFG. CO., LTD.

Declaration of Consolidated Financial Statements of Affiliated Enterprises

For the year ended December 31, 2020, pursuant to “ Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises, ” the entity that is required to be included in the consolidated financial statements of affiliates, is the same as the entity required to be included in the consolidated financial statements of parent and subsidiary companies under International Financial Reporting Standard No. 10. Additionally, if relevant information that should be disclosed in the consolidated financial statements of affiliates has all been disclosed in the consolidated financial statements of parent and subsidiary companies, it shall not be required to prepare separate consolidated financial statements of affiliates.

Hereby declare,

Y.C.C. PARTS MFG. CO., LTD.

Representative:

March 16, 2021

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INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

Opinion

We have audited the accompanying consolidated balance sheets of Y.C.C. Parts Mfg. Co., Ltd. and subsidiaries (the “Group”) as at December 31, 2020 and 2019, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2020 and 2019, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the Norm of Professional Ethics for Certified Public Accountants of 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 Group’s 2020 consolidated financial statements. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

Key audit matters for the Group’s 2020 consolidated financial statements are stated as follows:

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Cut-off of sales revenue recognition

Description

For the accounting policy of revenue recognition, please refer to Note 4(29); and for details of operating revenue, please refer to Note 6(21). The Group is primarily engaged in manufacturing and trading automobiles parts. Sale revenue is recognised when the control over the goods was transferred under the transaction terms.

The sales revenue recognition involves the use of several manual judgements and procedures. As a result, the timing of sales revenue recognition may be inappropriate. Therefore, we included the cut-off of sales revenue recognition as one of the key areas of focus for this year.

How our audit addressed the matter:

Our audit procedures in relation to the above key audit matter included:

1. Understanding and evaluating the operating procedures and internal controls over sales revenue, and assessing the effectiveness on how the management controls the timing of recognizing sales revenue.

2. Checked the completeness and performed cut-off tests on sales revenue for a certain period around the balance sheet date, including reviewing the transaction terms and verifying the transaction documents to ensure that transactions had been recorded in the proper period.

Assessment of allowance for inventory valuation loss

Description

For the accounting policy of inventory assessment, please refer to Note 4(14); for accounting estimates and assumption uncertainty in relation to inventory valuation, please refer to Note 5; and for details of allowance for inventory valuation losses, please refer to Note 6(6). The Group is primarily engaged in manufacturing and trading automobiles parts. Sale revenue is recognised when the control over the goods was transferred under the transaction terms.

As of December 31, 2020, the balances of inventories and allowance for inventory valuation losses were

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NT$ 373,010 thousand and NT$ 70,256 thousand, respectively.

The Group is primarily engaged in manufacturing and trading automobiles parts. Inventories that are over a certain age and separately recognised as impaired inventories are stated at the lower of cost and net realisable value. Those inventory items separately identified as obsolete and damaged are corroborated against supporting documents in recognising valuation losses. Considering that the Group’s inventories were material to its financial statements, and the determination of net realisable value as at balance sheet date involved judgements and estimates, we identified the assessment of allowance for inventory valuation losses a key audit matter.

How our audit addressed the matter:

Our audit procedures in relation to the above key audit matter included:

1. Obtained an understanding of the nature of the Group’s business and industry and assessed the reasonableness of provision policies in the determination of allowance for inventory valuation losses.

2. Reviewed the Group’s annual counting plan and conducted their physical counts on inventories to evaluate the control effectiveness on inventory classification.

3. Obtained the Group’s inventory aging report and verified dates of movements with supporting documents. Ensured the proper categorisation of inventory aging report in accordance with the Group’s policy.

4. Obtained the net realisable value statement of each inventory, assessed whether the estimation policy was consistently applied, tested the estimation basis of the net realisable value with relevant information, including verifying the sales and purchase prices with supporting evidence, and recalculated and evaluated the reasonableness of the inventory valuation.

Other matter – Scope of the audit

The consolidated financial statements of the Group for the year ended December 31, 2019, were audited by other independent auditors who report thereon dated March 26, 2020 expressed an unqualified opinion with an other matter paragraph on those statements.

Other matter – Parent company only financial reports

We have audited and expressed an unqualified opinion with an other matter paragraph on the parent

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company only financial statements of Y.C.C. Parts Mfg. Co., Ltd. as at and for the year ended December 31, 2020.

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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

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

Auditors’ responsibilities for the audit of the consolidated financial statements

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

As part of an audit in accordance with the generally accepted auditing standards in the Republic of China,

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we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

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

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

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

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

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

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

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

We also provide those charged with governance with a statement that we have complied with relevant

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ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

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

Wang, Yu-Chuan Liu, Mei-Lan For and on behalf of PricewaterhouseCoopers, Taiwan March 16, 2021

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and independent auditors’ report are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(2) 6(4) 6(5) 6(5) 6(6) 6(7) and 8 6(3) 6(8) and 8 6(9) and 8 6(10) and 8 6(11) 6(28) 6(12) and 8	December 31, 2020 AMOUNT % $ 585,276 11 18,301 - 418,192 8 29,553 - 591,658 11 3,579 - 302,754 6 86,426 2 2,035,739 38 52,241 1 2,767,101 52 146,668 3 16,506 1 8,203 - 115,287 2 156,656 3 3,262,662 62 $ 5,298,401 100	December 31, 2019	December 31, 2019
		AMOUNT $ 585,276 18,301 418,192 29,553 591,658 3,579 302,754 86,426 2,035,739 52,241 2,767,101 146,668 16,506 8,203 115,287 156,656 3,262,662 $ 5,298,401	AMOUNT $ 700,630 42,045 74,950 22,880 757,449 6,547 263,887 61,875 1,930,263 57,542 2,616,905 112,324 17,152 93,602 111,310 409,451 3,418,286 $ 5,348,549	%
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1136 Financial assets at amortised cost - current 1150 Notes receivable, net 1170 Accounts receivable, net 1200 Other receivables 130X Inventories 1470 Other current assets 11XX Total current assets Non-current assets 1517 Financial assets at fair value through other comprehensive income - non- current 1600 Property, plant and equipment 1755 Right-of-use assets 1760 Investment property, net 1780 Intangible assets 1840 Deferred income tax assets 1900 Other non-current assets 15XX Total non-current assets 1XXX Total assets				13 1 1 1 14 - 5 1
				36
				1 49 2 - 2 2 8
				64
				100

(Continued)

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity

December 31, 2020 December 31, 2019 Notes AMOUNT % AMOUNT % 6(13) $ 333,396 6 $ 254,868 5 6(2) 27,305 1 6,742 - 6(21) 20,177 - - - 118,492 2 113,429 2 251,103 5 247,776 5 6(14) 134,314 3 168,141 3 78,868 1 51,289 1 6(15) 137,261 3 248,665 5 1,507 - 14,848 - 1,102,423 21 1,105,758 21 6(15) 575,299 11 637,386 12 20,630 - - - 6(17) 14,388 - 7,516 - 610,317 11 644,902 12 1,712,740 32 1,750,660 33 6(18) 741,389 14 741,389 14 6(19) 1,193,259 23 1,193,024 23 6(20) 317,795 6 280,161 5 119,480 2 88,059 2 1,203,831 23 1,303,340 24 ( 105,211) ( 2) ( 119,481) ( 3 ) 6(18) ( 526) - ( 526) - 3,470,017 66 3,485,966 65 115,644 2 111,923 2 3,585,661 68 3,597,889 67 9 $ 5,298,401 100 $ 5,348,549 100

Current liabilities 2100 Short-term borrowings 2120 Financial liabilities at fair value through profit or loss - current 2130 Contract liabilities - current 2150 Notes payable 2170 Accounts payable 2200 Other payables 2230 Income tax liabilities - current 2320 Long-term liabilities, current portion 2399 Other current liabilities - others 21XX Current Liabilities Non-current liabilities 2540 Long-term borrowings 2560 Income tax liabilities - non current 2600 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total Liabilities Equity attributable to owners of parent Share capital 3110 Share capital - common stock Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 3500 Treasury shares 31XX Equity attributable to owners of the parent 36XX Non-controlling interests 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments 3X2X Total liabilities and equity

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

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except earnings per share)

Items

Year ended December 31 2020 2019 Notes AMOUNT % AMOUNT % 6(21) and 7(2) $ 2,120,901 100 $ 2,654,787 100 6(6)(26)(27) ( 1,483,398) ( 70) ( 1,849,701) ( 70) 637,503 30 805,086 30 6(26)(27) ( 127,736) ( 6) ( 151,543) ( 6) ( 127,769) ( 6) ( 137,848) ( 5) ( 31,247) ( 2) ( 34,048) ( 1) 12(2) ( 308) - ( 4,674) - ( 287,060) ( 14) ( 328,113) ( 12) 350,443 16 476,973 18 6(22) 8,105 1 23,378 1 6(8)(23) 21,278 1 66,211 2 6(24) ( 184,903) ( 9) ( 74,130) ( 3) 6(25) ( 16,226) ( 1) ( 29,406) ( 1) ( 171,746) ( 8) ( 13,947) ( 1) 178,697 8 463,026 17 6(28) ( 59,084) ( 3) ( 90,198) ( 3) $ 119,613 5 $ 372,828 14

4000 Sales revenue 5000 Operating costs 5900 Gross Profit Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 Expected credit impairment loss 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8200 Profit for the year

(Continued)

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except earnings per share)

Items

Year ended December 31 2020 2019 Notes AMOUNT % AMOUNT % 6(17) $ 143 - $ 184 - 6(3) ( 5,301) - ( 6,627) - 6(28) ( 28) - ( 37) - ( 5,186) - ( 6,480) - 21,593 1 ( 29,447) ( 1) 21,593 1 ( 29,447) ( 1) $ 16,407 1 ($ 35,927) ( 1) $ 136,020 6 $ 336,901 13 $ 117,679 5 $ 376,363 14 1,934 - ( 3,535) - $ 119,613 5 $ 372,828 14 $ 132,064 6 $ 344,924 13 3,956 - ( 8,023) - $ 136,020 6 $ 336,901 13 6(29) $ 1.59 $ 5.08 $ 1.58 $ 5.07

Other comprehensive income (loss) Components of other comprehensive income (loss) that will not be reclassified to profit or loss 8311 Other comprehensive income, before tax, actuarial gains (losses) on defined benefit plans 8316 Unrealised (losses) on valuation of equity instruments at fair value through profit or loss 8349 Income tax related to components of other comprehensive loss that will not be reclassified to profit or loss 8310 Components of other comprehensive loss that will not be reclassified to profit or loss Components of other comprehensive income (loss) that will be reclassified to profit or loss 8361 Financial statements translation differences of foreign operations 8360 Components of other comprehensive income (loss) that will be reclassified to profit or loss 8300 Total other comprehensive income (loss) for the year 8500 Total comprehensive income for the year Profit (loss), attributable to: 8610 Owners of parent 8620 Non-controlling interests Total Comprehensive income (loss) attributable to: 8710 Owners of parent 8720 Non-controlling interests Total Basic earnings per share 9750 Basic earnings per share 9850 Diluted earnings per share

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

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Notes Year 2019 Balance at January 1, 2019 Profit (loss) for the year Other comprehensive income (loss) for the year 6(3) Total comprehensive income (loss) Appropriation and distribution of 2018 earnings 6(20) Legal reserve Special reserve Cash dividends Treasury share transactions Difference between consideration and carrying amount of subsidiaries acquired 6(30) Changes in ownership interests in subsidiaries Disposal of equity investment at fair value through other comprehensive income Non-controlling interests Balance at December 31, 2019 Year 2020 Balance at January 1, 2020 Profit for the year Other comprehensive income (loss) for the year 6(3) Total comprehensive income (loss) Appropriation and distribution of 2019 earnings 6(20) Legal reserve Special reserve Cash dividends Acquisition of non-controlling interests in subsidiaries 6(30) Balance at December 31, 2020	Notes								Equityat	tri	butable to owners of t	h	eparent	eparent	eparent						Non-controlling interests		Total equity
			Share capital - common stock		Total capital surplus, additional paid-in capital				Retained Earnings				Other equityinterest				Treasuryshares		Total
							Legal reserve		Special reserve		Unappropriated retained earnings	d	Financial statements translation ifferences of foreign operations		Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income
			$ 741,389 - - - - - - - - - - - $ 741,389 $ 741,389 - - - - - - - $ 741,389		$ 1,188,790 - - - - - - - 2,035 2,199 - - $ 1,193,024 $ 1,193,024 - - - - - - 235 $ 1,193,259		$ 249,371 - - - 30,790 - - - - - - - $ 280,161 $ 280,161 - - - 37,634 - - - $ 317,795		$ 39,601 - - - - 48,458 - - - - - - $ 88,059 $ 88,059 - - - - 31,421 - - $ 119,480		$ 1,154,490 376,363 147 376,510 ( 30,790 ) ( 48,458 ) ( 148,248 ) - - - ( 164 ) - $ 1,303,340 $ 1,303,340 117,679 115 117,794 ( 37,634 ) ( 31,421 ) ( 148,248 ) - $ 1,203,831		($ 70,208 ) - ( 24,959 ) ( 24,959 ) - - - - - - - - ($ 95,167 ) ($ 95,167 ) - 19,571 19,571 - - - - ($ 75,596 )		($ 17,851 ) - ( 6,627 ) ( 6,627 ) - - - - - - 164 - ($ 24,314 ) ($ 24,314 ) - ( 5,301 ) ( 5,301 ) - - - - ($ 29,615 )		$ - - - - - - - ( 526 ) - - - - ($ 526 ) ($ 526 ) - - - - - - - ($ 526 )		$ 3,285,582 376,363 ( 31,439 ) 344,924 - - ( 148,248 ) ( 526 ) 2,035 2,199 - - $ 3,485,966 $ 3,485,966 117,679 14,385 132,064 - - ( 148,248 ) 235 $ 3,470,017		$ 156,735 ( 3,535 ) ( 4,488 ) ( 8,023 ) - - - - - - - ( 36,789 ) $ 111,923 $ 111,923 1,934 2,022 3,956 - - - ( 235 ) $ 115,644		$ 3,442,317 372,828 ( 35,927 ) 336,901 - - ( 148,248 ) ( 526 ) 2,035 2,199 - ( 36,789 ) $ 3,597,889 $ 3,597,889 119,613 16,407 136,020 - - ( 148,248 ) - $ 3,585,661

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

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments Adjustments to reconcile profit (loss) Depreciation expense (including investment property) Depreciation expense - right-of-use assets Amortisation expense Expected credit impairment loss Net loss on financial assets or liabilities at fair value through profit or loss Interest expense Interest income Government grant Dividend income Gain on disposal of property, plant and equipment Impairment loss Loss on market value decline and obsolescence Unrealised foreign exchange loss Changes in operating assets and liabilities Changes in operating assets Notes receivable, net Accounts receivable, net Other receivables Inventories Other current assets Other non-current assets Changes in operating liabilities Contract liabilities - current Notes payable Accounts payable Other payables Other current liabilities Net defined benefit liability Cash inflow generated from operations Interest received Interest paid Dividend received Income taxes paid Net cash flows from operating activities

Year ended December 31 Notes 2020 2019 $ 178,697 $ 463,026 6(26) 298,443 313,029 6(26) 4,744 - 6(26) 10,313 12,219 12(2) 308 4,674 6(24) 5,912 1,628 6(25) 16,226 29,406 6(22) ( 8,105 ) ( 23,378 ) ( 436 ) - 6(23) ( 4,036 ) ( 4,797 ) 6(24) ( 246 ) ( 29 ) 6(24) 84,794 76,013 - 2,386 15,091 15,863 ( 6,673 ) 24,781 163,769 ( 73,726 ) 541 ( 10,223 ) ( 38,867 ) 103,153 ( 31,644 ) ( 9,362 ) 1,849 - 5,851 - 5,063 ( 26,422 ) 3,327 ( 69,242 ) ( 33,888 ) 7,810 391 ( 13,858 ) ( 184 ) ( 160 ) 671,240 822,791 10,532 24,918 ( 13,922 ) ( 30,032 ) 4,036 - ( 13,692 ) ( 173,738 ) 658,194 643,939

(Continued)

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of financial assets at fair value through profit or loss Proceeds from disposal of financial assets at fair value through profit or loss Increase in financial assets at amortised cost Proceeds from disposal of financial assets at fair value through other comprehensive income Acquisition of property, plant and equipment Payment for capitalized interests Gain on disposal of property, plant and equipment Acquisition of intangible assets Acquisition of use-of-right assets (Increase) decrease in refundable deposits Decrease in other current assets Increase in other non-current assets Net cash outflow for acquiring subsidiaries Dividends received Net cash flows (used in) from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term borrowings Decrease in short-term borrowings Proceeds from long-term borrowings Repayments of long-term borrowings Repayment of principal portion of lease liabilities Cash dividends paid Change in non-controlling interests Payments to acquire treasury shares Increase in guarantee deposits received Net cash flows used in financing activities Effect of exchange rate changes on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

Year ended December 31 Notes 2020 2019 ($ 36,751 ) ($ 42,949 ) 75,146 15,153 ( 269,170 ) ( 74,950 ) - 792 6(31) ( 139,043 ) ( 165,874 ) 6(8) ( 3,333 ) - 4,709 414,214 6(11) ( 4,000 ) - 6(9) ( 32,819 ) - ( 833 ) 950 7,727 234,332 ( 136,135 ) ( 160,235 ) - 308 - 4,797 ( 534,502 ) 226,538 468,280 740,000 ( 389,391 ) ( 1,075,182 ) 200,100 104,199 ( 364,707 ) ( 722,972 ) 6(32) ( 99 ) - 6(32) ( 148,248 ) ( 148,248 ) 6(30) - ( 32,863 ) 6(18) - ( 526 ) 6(32) 398 - ( 233,667 ) ( 1,135,592 ) ( 5,379 ) 6,751 ( 115,354 ) ( 258,364 ) 700,630 958,994 $ 585,276 $ 700,630

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

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Y.C.C PARTS MFG.CO., LTD AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

1. History and Organisation

Y.C.C. PARTS MFG. CO., LTD. (the “Company”) was incorporated in March 1986 and has been listed on the Taiwan Stock Exchange since April 2012. The Company and its subsidiaries (collectively referred herein as the “Group”) are primarily engaged in manufacturing and trading automobiles parts, import and export as well as operating and reinvesting related businesses.

1. The Date of Authorisation for Issuance of the Financial Statements and Procedures for Authorisation

These consolidated financial statements were authorized for issuance by the Board of Directors on March 16, 2021.

1. Application of New Standards, Amendments and Interpretations

(1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

New standards, interpretations and amendments endorsed by the FSC effective from 2020 are as follows:

follows:
New Standards,Interpretations andAmendments	Effective date by International Accounting StandardsBoard
Amendments to IFRS 1 and IAS 8, ‘Disclosure initiative-definition of material’ Amendments to IFRS 3, ‘Definition of business’ Amendments to IFRS 9, IAS 39 and IFRS 7, ‘Interest rate benchmark reform’ Amendments to IFRS 16, ‘Covid-19-related rent concessions’	January 1, 2020 January 1, 2020 January 1, 2020 June 1, 2020 (Note)

Note: Earlier application from January 1, 2020 is allowed by FSC.

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by

the Group

New standards, interpretations and amendments endorsed by the FSC effective from 2021 are as follows:

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	Effective date by
	International Accounting
New Standards,Interpretations and Amendments	Standards Board
Amendments to IFRS 4, ‘Extension of the temporary exemption from applying IFRS 9’	January 1, 2021
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘Interest Rate Benchmark Reform— Phase 2’	January 1, 2021

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

(3) IFRSs issued by IASB but not yet endorsed by the FSC

New standards, interpretations and amendments issued by IASB but not yet included in the IFRSs as endorsed by the FSC are as follows:

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Effective date by
International Accounting
New Standards, Interpretations and Amendments Standards Board
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New Standards,Interpretations andAmendments	Effective date by International Accounting StandardsBoard
Amendments to IFRS 3, ‘Reference to the conceptual framework’	January 1, 2022
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of	To be determined by
assets between an investor and its associate or joint venture’	International Accounting
	Standard Board
IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IAS 1, ‘Classification of liabilities as current or non-current’	January 1, 2023
Amendments to IAS 1, ‘Disclosure of accounting policies’	January 1, 2023
Amendments to IAS 8, ‘Definition of accounting estimates’	January 1, 2023
Amendments to IAS 16, ‘Property, plant and equipment: proceeds before intended use’	January 1, 2022
Amendments to IAS 37, ‘Onerous contracts-cost of fulfilling a contract’	January 1, 2022
Annual improvements to IFRS Standards 2018-2020	January 1, 2022

The above standards and interpretations have no significant impact to the Group's financial condition and financial performance based on the Group's assessment.

4. Summary of Significant Accounting Policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(1) Compliance statement

The consolidated financial statements of the Group have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC

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Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”).

• (2) Basis of preparation

• A. Except for the following items, the consolidated financial statements have been prepared under the historical cost convention:

  • (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

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

  • (c) Defined benefit liabilities recognised based on the net amount of pension fund assets less present value of defined benefit obligation.

• B. The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

• (3) Basis of consolidation

• A. Basis for preparation of consolidated financial statements:

  • (a) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries are all entities controlled by the Group. The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries.

  • (b) Inter-company transactions, balances and unrealised gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group.

  • (c) Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the noncontrolling interests having a deficit balance.

  • (d) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are accounted for as equity transactions, i.e. transactions with owners in their capacity as owners. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity.

  • (e) When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. That fair value is regarded as the fair value on initial recognition of a financial asset or the cost on initial recognition of the associate or joint venture. Any difference between fair value and carrying amount is recognised in profit or loss. All

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amounts previously recognised in other comprehensive income in relation to the subsidiary are reclassified to profit or loss on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognised in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

B. Subsidiaries included in the consolidated financial statements:

Name of Investor	Name of Subsidiary	Main Business Activities		December 31,2020 December 31,2019 100.00% 100.00% 100.00% 100.00% 89.44% 89.44% 99.78% 99.60% 100.00% 100.00% 82.61% 82.61% 100.00% 100.00% Ownership(%)	Description Note 2 Note 4 Note 1 Note 3 Note 2 Note 4
				December 31,2020
The Company The Company RISE BRIGHT RISE BRIGHT CHINA FIRST CHINA FIRST CHINA FIRST	RISE BRIGHT HOLDINGS LTD. (RISE BRIGHT) UNITED SKILLS CO., LTD. (UNITED SKILLS) CHINA FIRST HOLDINGS LTD. (CHINA FIRST) CHANG JIE TECHNOLOGY CO., LTD. (CHANG JIE) CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. (CHANGSHU FUTE, formerly named CHANGSHU GUANLIN AUTOMOTIVE TRIM CO.,LTD.) LIAONING HETAI AUTOMOTIVE PARTS CO.,LTD. (LIAONING HETAI) CHANGSHU XINXIANG AUTOMOBILE PARTS CO., LTD. (CHANGSHU XINXIANG)	Holding company Manufacturing automobiles and their parts Holding company Producing and selling interior and exterior accessories of automobiles Producing and selling interior and exterior accessories of automobiles Producing and selling interior and exterior accessories of automobiles Producing and selling interior and exterior accessories of automobiles		100.00% 100.00% 89.44% 99.78% 100.00% 82.61% 100.00%

Note 1: In May 2019, the Group acquired a 20% equity interest in UNITED SKILLS from LOFTY SUCCESS GROUP LIMITED (LOFTY SUCCESS) in the amount of $32,863. As a result, the Company’s shareholding ratio to UNITED SKILLS increased to 100%. Please refer to Note 6(30) for information on equity transactions with non-controlling interest.

Note 2: In May 2019, the Group’s Board of Directors approved to increase its capital in RISE

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BRIGHT in the amount of US$ 2,500 thousand and reinvest in CHANG JIE through RISE BRIGHT. The establishment was completed on November 19, 2019.

• Note 3: In August 2019, the Group’s Board of Directors approved to decrease its capital in UNITED SKILLS in the amount of $150,000. UNITED SKILLS’s paid-in capital was $50,000 after the capital reduction. The capital reduction was effective from September 16, 2019, and the registration for the capital reduction was completed on October 5, 2019.

• Note 4: The Board of Directors resolved to increase its capital in the subsidiary, Rise Bright Holdings Ltd., in the amount of US$2 million (NT$57,360 thousand) on August 11, 2020, and then reinvested in Chang Jie Technology Co., Ltd.. The capital was remitted in October 2020. Due to the original shareholders of Chang Jie Technology Co., Ltd. not subscribing proportionately, Rise Bright Holdings Ltd.’s shareholding ratio increased to 99.78%.

• C. Subsidiaries not included in the consolidated financial statements None.

• D. Adjustments for subsidiaries with different balance sheet dates

• None.

• E. Significant restrictions

• None.

• F. Subsidiaries that have non-controlling interests that are material to the Group None.

(4) Foreign currency translation

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in New Taiwan dollars, which is the Company’s functional and the Group’s presentation currency.

• A. Foreign currency transactions and balances

• (a) Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognised in profit or loss in the period in which they arise.

• (b) Monetary assets and liabilities denominated in foreign currencies at the period end are retranslated at the exchange rates prevailing at the balance sheet date. Exchange differences arising upon re-translation at the balance sheet date are recognised in profit or loss.

• (c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognised in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their

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translation differences are recognised in other comprehensive income. However, nonmonetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions.

  - (d) All foreign exchange gains and losses are presented in the statement of comprehensive income within ‘other gains and losses’.

• B. Translation of foreign operations

  • (a) The operating results and financial position of all the group entities, associates and joint arrangements that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

    • i. Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet;

    • ii. Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period; and

    • iii.All resulting exchange differences are recognised in other comprehensive income.

  • (b) When the foreign operation partially disposed of or sold is a subsidiary, cumulative exchange differences that were recorded in other comprehensive income are proportionately transferred to the non-controlling interest in this foreign operation. In addition, even when the Group still retains partial interest in the former foreign subsidiary after losing control of the former foreign subsidiary, such transactions should be accounted for as disposal of all interest in the foreign operation.

  • (c) Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing exchange rates at the balance sheet date.

• (5) Classification of current and non-current items

• A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets:

  • (a) Assets arising from operating activities that are expected to be realised, or are intended to be sold or consumed within the normal operating cycle;

  • (b) Assets held mainly for trading purposes;

  • (c) Assets that are expected to be realised within twelve months from the balance sheet date;

  • (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to settle liabilities more than twelve months after the balance sheet date.

• B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:

  • (a) Liabilities that are expected to be settled within the normal operating cycle;

  • (b) Liabilities arising mainly from trading activities;

  • (c) Liabilities that are to be settled within twelve months from the balance sheet date;

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• (d) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. 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.

(6) Cash equivalents

Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits that meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.

(7) Financial assets at fair value through profit or loss

• A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortised cost or fair value through other comprehensive income.

• B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value and recognises the transaction costs in profit or loss. The Group subsequently measures the financial assets at fair value, and recognises the gain or loss in profit or loss.

• D. The Group recognises the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.

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

• A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Group has made an irrevocable election at initial recognition to recognise changes in fair value in other comprehensive income and debt instruments which meet all of the following criteria:

  • (a) The objective of the Group’s business model is achieved both by collecting contractual cash flows and selling financial assets; and

  • (b) The assets’ contractual cash flows represent solely payments of principal and interest.

• B. On a regular way purchase or sale basis, financial assets at fair value through other comprehensive income are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs. The Group subsequently measures the financial assets at fair value:

  • The changes in fair value of equity investments that were recognised in other comprehensive income are reclassified to retained earnings and are not reclassified to profit or loss following the derecognition of the investment. Dividends are recognised as revenue when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.

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(9) Financial assets at amortised cost

• A. Financial assets at amortised cost are those that meet all of the following criteria:

• (a) The objective of the Group’s business model is achieved by collecting contractual cash flows.

• (b) The assets’ contractual cash flows represent solely payments of principal and interest.

• B. On a regular way purchase or sale basis, financial assets at amortised cost are recognised and derecognised using trade date accounting.

• C. The Group’s time deposits which do not fall under cash equivalents are those with a short maturity period and are measured at initial investment amount as the effect of discounting is immaterial.

• (10) Accounts and notes receivable

• A. Accounts and notes receivable entitle the Group a legal right to receive consideration in exchange for transferred goods or rendered services.

• B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

• (11) Impairment of financial assets

For financial assets at amortised cost, at each reporting date, the Group recognises the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognises the impairment provision for the lifetime expected credit losses (ECLs) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable that do not contain a significant financing component, the Group recognises the impairment provision for lifetime ECLs.

(12) Derecognition of financial assets

The Group derecognises a financial asset when the contractual rights to receive the cash flows from the financial asset expire.

－ (13) Leasing arrangements (lessor) operating leases

Lease income from an operating lease (net of any incentives given to the lessee) is recognised in profit or loss on a straight-line basis over the lease term.

(14) Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined using the weighted-average method. The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production overheads. It excludes borrowing costs. Except for the same types of inventory, the item by item approach is used in applying the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses.

(15) Property, plant and equipment

• A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalised.

• B. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset,

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as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

• C. Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. Each part of an item of property, plant, and equipment with a cost that is significant in relation to the total cost of the item must be depreciated separately.

• D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change. The estimated useful lives of property, plant and equipment are as follows:

Buildings and structures Machinery and equipment Molding equipment Transportation equipment Furniture equipment Other equipment

10 ~ 20 years 2 ~ 15 years 2 ~ 12 years 3 ~ 10 years 2 ~ 6 years 2 ~ 20 years

(16) Leasing arrangements (lessee) － right-of-use assets/ lease liabilities

• A. Leases are recognised as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for use by the Group. For short-term leases or leases of lowvalue assets, lease payments are recognised as an expense on a straight-line basis over the lease term.

• B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are comprised of fixed payments, less any lease incentives receivable.

• The Group subsequently measures the lease liability at amortised cost using the interest method and recognises interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognised as an adjustment to the right-of-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.

• C. At the commencement date, the right-of-use asset is stated at cost comprising the following: (a) The amount of the initial measurement of lease liability;

• (b) Any lease payments made at or before the commencement date;

• (c) Any initial direct costs incurred by the lessee.

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The right-of-use asset is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. When the lease liability is remeasured, the amount of remeasurement is recognised as an adjustment to the right-of-use asset.

• D. For lease modifications that decrease the scope of the lease, the lessee shall decrease the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease, and recognise the difference between remeasured lease liability in profit or loss.

• (17) Investment property

• A. An investment property is stated initially at its cost and measured subsequently using the cost model. Land use right is depreciated on a straight-line basis over its contract of 50 years signed with the government of Changshu City, Jiangsu Province, China; buildings and structures are depreciated on a straight-line basis over its estimated useful life of 20 years.

• B. Starting from 2019, an investment property acquired from lease is initially measured at cost (including the amount of the initial measurement of lease liability, lease payments made before the commencement date, initial direct costs and estimated costs of restoring the underlying asset net of lease incentives receivable) and subsequently measured at cost, net of accumulated depreciation and impairment, thereby adjusting remeasurements of lease liabilities.

• (18) Intangible assets

• A. Computer software

  • Computer software is stated at cost and amortised on a straight-line basis over its estimated useful life of 3 to 5 years.

• B. Goodwill

  • Goodwill arises in a business combination accounted for by applying the acquisition method. Acquisition prices in the business combination are calculated based on the acquisition price. The excess of the acquisition price over the fair value of the identifiable assets acquired is recorded as goodwill.

(19) Impairment of non-financial assets

• A. The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. Except for goodwill, when the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortised historical cost would have been if the impairment had not been recognised.

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• B. The recoverable amounts of goodwill are evaluated periodically. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. Impairment loss of goodwill previously recognised in profit or loss shall not be reversed in the following years.

• C. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units, or groups of cash-generating units, that is/are expected to benefit from the synergies of the business combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the eqtity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level.

(20) Borrowings

Borrowings comprise long-term and short-term bank borrowings. Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over the period of the borrowings using the effective interest method.

(21) Notes and accounts payable

• A. Accounts payable are liabilities for purchases of raw materials, goods or services and notes payable are those resulting from operating and non-operating activities.

• B. The short-term notes and accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(22) Financial liabilities at fair value through profit or loss

• A. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of held for trading. Derivatives are also categorised as financial liabilities held for trading unless they are designated as hedges.

• B. At initial recognition, the Group measures the financial liabilities at fair value. All related transaction costs are recognised in profit or loss. The Group subsequently measures these financial liabilities at fair value with any gain or loss recognised in profit or loss.

(23) Derecognition of financial liabilities

• A financial liability is derecognised when the obligation specified in the contract is either discharged or cancelled or expires.

(24) Offsetting financial instruments

Financial assets and liabilities are offset and reported in the net amount in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

(25) Employee benefits

• A. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected

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to be paid in respect of service rendered by employees in a period and should be recognised as expense in that period when the employees render service.

• B. Pensions

• (a) Defined contribution plans

For defined contribution plans, the contributions are recognised as pension expense when they are due on an accrual basis. Prepaid contributions are recognised as an asset to the extent of a cash refund or a reduction in the future payments.

• (b) Defined benefit plans

  • i.Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest rates of government bonds (at the balance sheet date) of a currency and term consistent with the currency and term of the employment benefit obligations.

  • ii.Remeasurements arising on defined benefit plans are recognised in other comprehensive income in the period in which they arise and are recorded as retained earnings.

  • iii.Past service costs are recognised immediately in profit or loss.

• C. Employees’ compensation and directors’ and supervisors’ remuneration

• Employees’ compensation and directors’ and supervisors’ remuneration are recognised as expense and liability, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates. If employee compensation is paid by shares, the Group calculates the number of shares based on the closing price at the previous day of the board meeting resolution.

(26) Income tax

• A. The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or items recognised directly in equity, in which cases the tax is recognised in other comprehensive income or equity.

• B. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in

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the year the stockholders resolve to retain the earnings.

• C. Deferred tax is recognised, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is provided on temporary differences arising on investments in subsidiaries, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

• D. Deferred tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. At each balance sheet date, unrecognised and recognised deferred tax assets are reassessed.

• (27) Share capital

• A. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.

• B. Where the Company repurchases the Company’s equity share capital that has been issued, the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company’s equity holders. Where such shares are subsequently reissued, the difference between their book value and any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders.

• (28) Dividends

Dividends are recorded in the Company’s financial statements in the period in which they are resolved by the Company’s shareholders. Cash dividends are recorded as liabilities.

• (29) Revenue recognition

Sales of goods

• A. The Group manufactures and sells automobiles parts products. Sales are recognised when control of the products has transferred. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, or the Group has objective evidence that all criteria for acceptance have been satisfied.

• B. Sales revenue was recognized based on the contract price net of sales discount. Goods are often sold with sales discounts and allowances based on future estimated sales volume. Accumulated experience is used to estimate and provide for the sales discounts and allowances, using the expected value method, and revenue is only recognised to the extent that it is highly probable that

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a significant reversal will not occur. The estimation is subject to an assessment at each reporting date. The sales usually are made with a credit term of 30 to 180 days after the delivery date. which is consistent with market practice. As the time interval between the transfer of committed goods or service and the payment of customer does not exceed one year, the Group does not adjust the transaction price to reflect the time value of money.

• C. A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

(30) Government grants

Government grants are recognised at their fair value only when there is reasonable assurance that the Company will comply with conditions attached to the grants and the grants will be received. Government grants are recognised in profit or loss on a systematic basis over the periods in which the Group recognises expenses for the related costs for which the grants are intended to compensate. Government grants related to property, plant and equipment are recognised as non-current liabilities and are amortised to profit or loss over the estimated useful lives of the related assets using the straight-line method.

(31) Business combinations

• A. The Group uses the acquisition method to account for business combinations. The consideration transferred for an acquisition is measured as the fair value of the assets transferred, liabilities incurred or assumed and equity instruments issued at the acquisition date, plus the fair value of any assets and liabilities resulting from a contingent consideration arrangement. All acquisitionrelated costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. For each business combination, the Group measures at the acquisition date components of non-controlling interests in the acquiree that are present ownership interests and entitle their holders to the proportionate share of the entity’s net assets in the event of liquidation at the present ownership instruments’ proportionate share in the recognised amounts of the acquiree’s identifiable net assets. All other non-controlling interests should be measured at the acquisition-date fair value.

• B. The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value of any previous equity interest in the acquiree over the fair value of the identifiable assets acquired and the liabilities assumed is recorded as goodwill at the acquisition date. If the total of consideration transferred, non-controlling interest in the acquiree recognised and the fair value of previously held equity interest in the acquiree is less than the fair value of the identifiable assets acquired and the liabilities assumed, the difference is recognised directly in profit or loss on the acquisition date.

(32) Operating segments

Operating segments are reported in a manner consistent with the internal reporting provided to the

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chief operating decision maker. The Group’s chief operating decision maker is responsible for allocating resources and assessing performance of the operating segments.

5. Critical Accounting Judgements, Estimates and Key Sources of Assumption Uncertainty

The preparation of these consolidated financial statements requires management to make critical judgements in applying the Group’s accounting policies and make critical assumptions and estimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. Such assumptions and estimates have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year ; and the related information is addressed below:

(1) Critical judgements in applying the Group’s accounting policies

None.

(2) Critical accounting estimates and assumptions

• Evaluation of inventories

As inventories are stated at the lower of cost and net realisable value, the Group must determine the net realisable value of inventories on balance sheet date using judgements and estimates. As net realisable value of inventories is estimated at the estimated selling price in the ordinary course of business, less the estimated cost of completion and estimated selling expenses, the estimates are based on current market conditions and historical sales experience of similar products and the result of the estimates might be significantly influence by changes in market conditions.

As of December 31, 2020, the carrying amount of inventories was $302,754.

6. Details of Significant Accounts

(1) Cash and cash equivalents

tails of Significant Accounts Cash and cash equivalents
Cash on hand Checking accounts and demand deposits Time deposits Short-term notes and bills - Re-Purchase Interest rate range Time deposits	December31,2020 374 $ 207,863 319,581 57,458 585,276 $ 0.1%~0.41%	December 31, 2019
		342 $ 112,664 557,516 30,108
		700,630 $
		0.01%~2.55%

• A. The Group transacts with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote.

• B. The time deposits maturing over three months and time deposits that are restricted and are not held for the purpose of meeting short-term cash commitments were presented as ‘financial assets at amortised cost’. Refer to Note 6(4) for details.

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(2) Financial assets and liabilities at fair value through profit or loss - current

Items Financial assets mandatorily measured at fair value through profit or loss Listed stocks Valuation adjustment Total Financial liabilities held for trading Foreign exchange swap contracts Items Financial assets mandatorily measured at fair value through profit or loss Non-derivative financial assets - Domestic listed stocks Financial liabilities held for trading Derivative instruments (not designated as hedging) - Foreign exchange swap contracts

December31,2020 20,213 $ 1,912) ( 18,301 $ 27,305) ($ December 31, 2019 42,045 $ 6,742) ($

• A. The Group recognised financial assets and liabilities at fair value through profit or loss of ($5,912), and ($1,628) for the years ended December 31, 2020 and 2019, respectively.

• B. Explanations of the transactions and contract information in respect of derivative financial assets and liabilities that the Group does not adopt hedge accounting are as follows:

Derivative financial assets (liabilities) Foreign exchange swap contracts Derivative financial assets (liabilities) Foreign exchange swap contracts	December 31, 2020	December 31, 2020
	Contract amount (Notional principal)	Contractperiod
	Contract amount (Notionalprincipal)	Maturity period
	USD 18,450 thousand	2020.01.03 ~ 2020.1.31

• C. The Group has no financial assets and liabilities at fair value through profit or loss pledged to others as collateral.

• D. Information relating to credit risk of financial assets and liabilities at fair value through profit or loss is provided in Note 12(2).

~31~

(3) Financial assets at fair value through other comprehensive income-non-current

==> picture [468 x 139] intentionally omitted <==

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

Items December 31, 2020
Non-current items:
Equity instruments
Listed stocks $ 81,856
Valuation adjustment ( 29,615)
$ 52,241
Items December 31, 2019
Equity instruments - domestic listed stocks $ 57,542
----- End of picture text -----

• A. The Group has elected to classify investments that are considered to be strategic investments or steady dividend income as financial assets at fair value through other comprehensive income. The fair value of such investments amounted to $52,241 and $57,542 as at December 31, 2020, and 2019, respectively.

• B. Due to the change of investment strategy, the Group sold $793 of equity instruments and resulted in cumulative losses on disposal amounting to $164 in February 2019, and it was transferred from other equity to unappropriated retained earnings.

• C. Amounts recognised in profit or loss and other comprehensive income in relation to the financial assets at fair value through other comprehensive income are listed below:

		Years ended	December 31,	December 31,
		2020		2019
Equity instruments at fair value through
other comprehensive income
Fair value change recognised in other
comprehensive loss	($	5,301)	($	6,627)
Cumulative gains reclassified to retained
earnings due to derecognition	$	-	$	164
Dividend income recognised in profit or loss
Held at end of year	$	2,993	$	2,993

• D. As at December 31, 2020 and 2019, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the financial assets at fair value through other comprehensive income held by the Group were $52,241 and $57,542, respectively.

• E. The Group has no financial assets at fair value through other comprehensive income pledged to others as collateral.

• F. Information relating to credit risk of financial assets at fair value through other comprehensive income is provided in Note 12(2).

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(4) Financial assets at amortised cost

Items December 31, 2020 December 31, 2019

Current items: Time deposits maturing over three months $ 418,192 $ 74,950

• A. As at December 31, 2020 and 2019, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the financial assets at amortised cost held by the Group were $418,192 and $74,950, respectively.

• B. As of December 31, 2019, restricted time deposits amounted to $93,807, shown as other current assets and other non-current assets.

• C. Information about the financial assets at amortised cost that were pledged to others as collateral is provided in Note 8.

• D. Information relating to credit risk of financial assets at amortised cost is provided in Note 12(2).

• (5) Notes and accounts receivable, net

Notes and accounts receivable, net
		December	31, 2020		December	31,2019
Notes receivable		$	29,632		$	22,948
Less: Allowance for uncollectible accounts	(		79)	(		68)
		$	29,553		$	22,880
		December	31,2020		December	31,2019
Accounts receivable	$		635,490	$		800,271
Less: Allowance for uncollectible accounts	(		43,832)	(		42,822)
	$		591,658	$		757,449

• A. The aging analysis of notes receivable and accounts receivable are as follows:

Not past due 0~60 days 61~120 days 121~180 days 181-240 days Over 241 days	Notesreceivable 29,632 $ - - - - - 29,632 $ December	Accounts receivable 31,2020
		562,115 $ 61,842 996 1,701 2,398 6,438
		635,490 $

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		December	31,2019	31,2019
		Notesreceivable		Accountsreceivable
0 to 120 days	$	22,948	$	688,718
121 to 180 days		-		61,422
181 to 240 days		-		20,781
241 to 360 days		-		10,092
Over 360 days		-		19,258
	$	22,948	$	800,271

As of December 31, 2020 and 2019, the ageing analysis was based on past due date and invoice date.

• B. As of December 31, 2020 and 2019, the balances of accounts receivable and notes receivable were all from contracts with customers. As of January 1, 2019, the balances of accounts receivable and notes receivable from contracts with customers amounted to $751,948 and $48,436, respectively.

• C. As at December 31, 2020 and 2019, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the Group’s notes receivable and accounts receivable were $29,553 and $22,880 as well as $591,658 and $757,449, respectively.

• D. Information relating to credit risk of notes receivable and accounts receivable is provided in Note 12(2).

(6) Inventories

12(2). nventories
Materials and supplies Work in progress Semi-finished goods Finished goods Merchandise Total Materials and supplies Work in progress Semi-finished goods Finished goods Merchandise Total		December31,2020
	Cost 89,696 $ 62,902 11,255 187,057 22,100 373,010 $	Allowance for valuation loss 27,408) ($ 6,192) ( 7,220) ( 29,436) ( - 70,256) ($	Bookvalue
			62,288 $ 56,710 4,035 157,621 22,100
			302,754 $
			December31,2019
			Bookvalue
			61,208 $ 38,922 4,041 128,866 30,850
			263,887 $

~34~

The cost of inventories recognised as expense for the period:

			Year ended
		December31,2020
Cost of goods sold		$	1,379,772
Unallocated fixed overheads			96,930
Loss on scrapping inventory			8,069
Loss on market value decline and obsolete and slow-moving inventories			6,159
Gain on physical inventory	(		7,532)
		$	1,483,398

For the year ended December 31, 2019, the operating cost related to inventory amounted to $1,849,701, including loss on market value decline and obsolete and slow-moving inventories of $2,386.

(7) Other current assets

$2,386. Other current assets
Prepayments Other financial assets Other current assets - others	December31,2020 58,982 $ 26,213 1,231 86,426 $	December31,2019
		16,578 $ 33,940 11,357
		61,875 $

Information about the other financial assets that were pledged to others as collaterals is provided in Note 8.

(Remainder of page intentionally left blank)

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(8) Property, plant and equipment

Property, plant and equipment
								Yearended	December31,		2020
		Beginning balance			Additions			Decreases		Transfers	Net exchange differences				Ending balance
Cost
Land		$	956,365	$	-		$	-	$	-	$		-		$	956,365
Buildings and structures			1,519,897		8,273	(		9,139)		23,372			6,288			1,548,691
Machinery and equipment			1,170,965		61,838	(		74,488)		43,522			6,077			1,207,914
Molding equipment			1,615,001		20,969	(		20,010)		62,509			325			1,678,794
Transportation equipment			29,976		3,633	(		1,185)		-			32			32,456
Furniture equipment			4,438		559	(		1,816)		-			14			3,195
Other equipment			168,298		17,314	(		20,121)		14,931			634			181,056
Unfinished construction and
equipment under acceptance			73,826		30,983			-		153,638			1,390			259,837
		$	5,538,766	$	143,569	($		126,759)	$	297,972		$	14,760		$	5,868,308
Accumulated Depreciation
Buildings and structures	($		705,279)	($	70,702)		$	9,139	$	-	($		935)	($		767,777)
Machinery and equipment	(		749,234)	(	96,335)			69,024		-	(		2,821)	(		779,366)
Molding equipment	(		1,314,590)	(	109,208)			21,011		-	(		116)	(		1,402,903)
Transportation equipment	(		24,654)	(	2,051)			1,185		-	(		14)	(		25,534)
Furniture equipment	(		3,884)	(	376)			1,816		-	(		5)	(		2,449)
Other equipment	(		124,220)	(	18,853)			20,121		-	(		226)	(		123,178)
	($		2,921,861)	($	297,525)		$	122,296	$	-	($		4,117)	($		3,101,207)
Total		$	2,616,905												$	2,767,101

~36~

						Year ended	December31,2019	December31,2019	December31,2019
	Beginningbalance			Additions		Decreases		Transfers	Net exchange differences			Endingbalance
Cost
Land	$	1,370,550	$	-	($	414,185)	$	-	$	-		$	956,365
Buildings and structures		1,563,686		5,239	(	19,430)	(	16,122)	(	13,476)			1,519,897
Machinery and equipment		1,085,683		45,966	(	9,094)		64,009	(	15,599)			1,170,965
Molding equipment		1,536,947		34,721	(	40,084)		84,863	(	1,446)			1,615,001
Transportation equipment		31,955		2,280	(	4,196)		-	(	63)			29,976
Furniture equipment		5,700		196	(	1,372)		-	(	86)			4,438
Other equipment		161,119		9,632	(	3,491)		3,023	(	1,985)			168,298
Unfinished construction and
equipment under acceptance		6,089		71,071		-	(	542)	(	2,792)			73,826
	$	5,761,729	$	169,105	($	491,852)	$	135,231	($	35,447)		$	5,538,766
Accumulated Depreciation
Buildings and structures	($	657,441)	($	72,143)	$	19,430	$	625	$	4,250	($		705,279)
Machinery and equipment	(	671,366)	(	95,214)		9,094		-		8,252	(		749,234)
Molding equipment	(	1,237,237)	(	118,228)		40,084		33		758	(		1,314,590)
Transportation equipment	(	26,261)	(	2,506)		4,196		-	(	83)	(		24,654)
Furniture equipment	(	4,542)	(	915)		1,372		-		201	(		3,884)
Other equipment	(	110,096)	(	18,781)		3,491		-		1,166	(		124,220)
	($	2,706,943)	($	307,787)	$	77,667	$	658	$	14,544	($		2,921,861)
	$	3,054,786										$	2,616,905

A. Transfers for the period were from prepayments for business facilities.

B. Information about the property, plant and equipment that were pledged to others as collateral is provided in Note 8.

~37~

• A. On September 14, 2015, UNITED SKILLS acquired 3.7 hectares of land located in Dounan Township, Yunlin County for a consideration of $412,000 from the landowner. However, afterwards the Environmental Protection Bureau of Yunlin County found that the land was covered with incineration bottom ash and waste. Therefore, UNITED SKILLS filed a lawsuit with the Yunlin District Court of Taiwan to appeal for the return of consideration and damage compensation on February 6, 2017. On January 18, 2019, UNITED SKILLS conducted a settlement with the original landowner and agreed to cancel the registration of ownership transfer of the land and return it to the original landowner. In April 2019, the original landowner returned $414,185, including the payment for cancellation of the line of credit mortgage and general superficies of the land, and paid an additional amount of $43,815 to UNITED SKILLS.

• B. Amount of borrowing costs capitalised as part of property, plant and equipment and the range of the interest rates for such capitalisation are as follows:

he interest rates for such capitalisation are as follows:
December 31, 2020 Amount capitalised 3,333 $ Range of the interest rates for capitalisation 0.95%	December31,2019
	3,749 $
	1.16%

• C. Information about the property, plant and equipment that were pledged to others as collateral is provided in Note 8.

• (9) Lease transactions – lessee

• A. The Group leases various assets including land and business vehicles. Rental contracts are typically made for periods of 5 to 50 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants, but leased assets may not be used as security for borrowing purposes. Upon expiry of the lease, the terms of lease agreements do not give priority rights to renew the lease or purchase the property.

• B. The carrying amount of right-of-use assets and the depreciation charge are as follows:

he property. he carrying amount of right-of-use assets and the	depreciation charge are as follows:
Land Transportation equipment (Business vehicles) Land Transportation equipment (Business vehicles)	December31,2020 December 31, 2019 Carrying amount Carrying amount 141,079 $ 108,600 $ 5,589 3,724 146,668 $ 112,324 $ 2020 2019 Depreciation charge Depreciation charge 3,579 $ 3,217 $ 1,165 1,064 4,744 $ 4,281 $ Years endedDecember31,
	2020 Depreciation charge 3,579 $ 1,165 4,744 $

• C. For the years ended December 31, 2020 and 2019, the costs of additions to right-of-use assets were $35,849 and $0, respectively. Net exchange differences were $1,584 and $0 as of December 31, 2020 and 2019, respectively.

~38~

D. Information on profit or loss in relation to lease contracts are as follows:

==> picture [453 x 102] intentionally omitted <==

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

Years ended December 31,
2020 2019
Items affecting profit or loss
Interest expense on lease liabilities $ 5 $ -
Expense on short-term lease contracts $ 1,134 $ 1,457
Expense on leases of low-value assets $ 680 $ 200
----- End of picture text -----

• E. As of December 31, 2020, lease liabilities-current and lease liabilities-non-current amounted to $594 thousand and $2,337 thousand, respectively.

• F. For the years ended December 31, 2020 and 2019, the Group’s total cash outflow for leases were $1,918 and $1,657, respectively.

• G. Information about the right-of-use assets that were pledged to others as collateral is provided in Note 8.

(10) Investment property

Year ended December 31, 2020

Beginning balance Additions Decreases Cost Land use right 4,185 $ - $ - $ Buildings and structures 15,947 - - 20,132 $ - $ - $ Accumulated depreciation Land use right 123) ($ 123) ($ - $ Buildings and structures 2,857) ( 795) ( - 2,980) ( 918) ($ - $ 17,152 $	Net exchange Ending Transfers differences balance - $ 395 $ 4,580 $ - 271 16,218 - $ 666 $ 20,798 $ - $ 329) ($ 575) ($ - 65) ( 3,717) ( - $ 394) ($ 4,292) ( 16,506 $

~39~

Year ended December 31, 2019

Cost Land use right Buildings and structures Accumulated depreciation Land use right Buildings and structures	Beginning Net exchange Ending balance Additions Decreases Transfers differences balance - $ - $ - $ 4,475 $ 290) ($ 4,185 $ - - - 18,823 2,876) ( 15,947 - $ - $ - $ 23,298 $ 3,166) ($ 20,132 $ - $ 129) ($ - $ - $ 6 $ 123) ($ - 832) ( - 2,149) ( 124 2,857) ( - 961) ($ - $ 2,149) ($ 130 $ 2,980) ( - $ 17,152 $

• A. Rental income from investment property and direct operating expenses arising from investment property are shown below:

property are shown below:
Rental income from investment property Direct operating expenses arising from the investment property that generated rental income during the period Direct operating expenses arising from the investment property that did not generate rental income during the period		Year ended December 31,2020
		3,186 $ 918 $ - $

• B. The fair value of the investment property held by the Group, which is the land use right and buildings and structures, as at December 31, 2020 was $19,757. The valuations were made using the carrying amount of land use rights upon the expiry of the lease and the discounted inflow of future rental income for 3 years, using the borrowing interest rate of 4.15%, after taking into consideration of future economic growth and results of inflation. The fair value is classified as a level 3 fair value.

• C. The fair value of the investment property as at December 31, 2019 was $21,547, which was valued by the Group’s management, not by independent valuers, using the valuation model widely accepted by market participants with level 3 inputs. Valuations were made using the discounted cash flow method and significant unobservable inputs used included discounted rates.

• D. CHANGSHU FUTE subleases its 36.5-year land use right in Changshu city, Jiangsu Province, China to DAQIAOJIXIE JIANGSU YOUXIANGONGSI (DAQIAOJIXIE) under noncancellable operating lease agreements. The lease terms are 3 years, and rental is adjusted to reflect market rental rates when the lessee exercises extension options. The lessee is not granted the right of priority to buy the investment property when the lease expires. On July 1, 2020, CHANGSHU FUTE re-signed the lease agreement with DAQIAOJIXIE and JIANGSU JIASHENGYU INTELLIGENT TECHNOLOGY., LTD (JIANGSU JIASHENGYU) and the lease term under this agreement is 2.5 years. As CHANGSHU FUTE pledged the buildings and

~40~

structures as collateral to the Shanghai Pudong Development Bank for loans, it will terminate the agreement early with the DAQIAOJIXIE and JIANGSU JIASHENGYU and pay the relavant compensation if the bank exersies its rights to the pledged collateral and disposes it. E. The future aggregate minimum lease payments receivable are as follows:

	December31,2020	December31,2020	December31,2019	December31,2019
Not later than one year	$	3,284	$	3,196
Later than one year but not later than five years		3,448		6,658
	$	6,732	$	9,854

F. Information about the investment property that was pledged to others as collateral is provided in Note 8.

(11) Intangible assets

Note 8. Intangible assets
				Year		endedDecember			31,	2020
	Beginning						Impairment			Net exchange			Ending
		balance	Additions		Decreases			loss		differences			balance
Cost
Goodwill	316,465 $		$	-	$	-	$		-	($	15,834)	$	300,631
Computer software		14,201		4,000	(	240)			-		15		17,976
		330,666	$	4,000	($	240)	$		-	($	15,819)	$	318,607
Accumulated amortisation
Computer software	($	6,629)	($	3,374)	$	240	$		-	($	10)	($	9,773)
Accumulated impairment
Goodwill	230,435) ($		$	-	$	-	($	84,794)		$	14,598	($	300,631)
Book value	$	93,602										$	8,203
				Year		endedDecember			31,	2019
	Beginning						Impairment			Net exchange			Ending
		balance	Additions		Decreases			loss		differences			balance
Cost
Goodwill	324,223 $		$	-	$	-	$		-	($	7,758)	$	316,465
Computer software		14,025		-	(	1,751)			-		1,927		14,201
		338,248	$	-	($	1,751)	$		-	($	5,831)		330,666
Accumulated amortisation
Computer software	($	5,592)	($	2,227)	$	1,751	$		-	($	561)	($	6,629)
Accumulated impairment
Goodwill	160,555) ($		$	-	$	-	($	76,013)		$	6,133	($	230,435)
Book value	172,101 $											$	93,602

• A. The above amortisation expenses were recognised under overheads, administrative expenses and research and development expenses in the statements of comprehensive income.

• B. Goodwill arising from acquisition of CHINA FIRST and CHANGSHU FUTE in April 2015 amounted to US$10,556 thousand and it arose mainly from anticipation of CHANGSHU FUTE that operating revenue will benefit from the growth of the auto parts market in Mainland China. However, the actual operation in CHANGSHU FUTE was not as expected as the auto part market in Mainland China was impacted by the continuous weak economic environment. The Group recognised impairment losses for the goodwill of $84,794 and $76,013 for the years ended December 31, 2020 and 2019, respectively.

~41~

• C. The recoverable amount of CHANGSHU FUTE was determined based on value-in-use calculations. These calculations use cash flow projections based on financial budgets approved by the management covering a five-year period and a discount rate of 9.74% and 11.30% per annum in 2020 and 2019, respectively. Other key assumptions include expected operating revenue and gross profit. These assumptions are based on the cash-generating units’ past operating performance and management’s expectation of the market development.

(12) Other non-current assets

Other non-current assets
	December	31, 2020	December	31,2019
Prepayments for business facilities	$	148,897	$	310,734
Guarantee deposits paid		2,278		1,445
Other financial assets - non-current		-		89,940
Others		5,481		7,332
	$	156,656	$	409,451

Information about the other non-current assets that were pledged to others as collaterals is provided in Note 8.

(13) Short-term borrowings

(13)	in Note 8. Short-term borrowings
(14)	Other payables Type of borrowings Unsecured borrowings Secured borrowings Interest rate range Salaries and bonus payable Machinery and equipment payable Transportation fee payable Employees’ compensation payable Directors’ remuneration payable Others	December31,2020 71,266 $ 262,130 33,396 $ 2.01%~4.15% December 31, 2020 34,920 $ 34,547 8,129 5,309 4,010 47,399 134,314 $	December31,2019
			254,868 $ -
			254,868 $
			1.08%~4.29%
			December31,2019
			43,562 $ 30,021 14,426 6,197 4,767 69,168
			168,141 $

~42~

- (15) Long term borrowings

Long-term borrowings
Type ofborrowings	Borrowing period	Repayment term		December31,2020
Long-term bank
borrowings
Unsecured borrowings	From November	The loan is fully disbursed once		$	113,833
	26, 2018 to	the contract signed; interest is
	November 26,	repayable monthly; principal is
	2023	repayable monthly in 48
		installments with a year grace
Unsecured borrowings	From August 31,	Starting from August 15, 2019,			59,998
	2016 to February	principal is repayable quarterly;
	15, 2023	interest is repayable monthly
Unsecured borrowings	From April 12,	Repayment date is two years			21,807
	2016 to April 14,	after the borrowing date; interest
	2021	is repayable quarterly
Unsecured borrowings	From September	Starting from October 14, 2018,			12,460
	14, 2017 to	principal and interest are
	September 14,	repayable monthly in 48
	2022	installments
Unsecured borrowings	From December	The loan is disbursed within three			18,300
	26, 2019 to	years after contract is signed;
	December 26,	interest is repayable monthly;
	2026	principal is repayable monthly in
		48 installments with a 3-year
		grace period on principal only
Secured borrowings	From January 6,	Principal and interest are			294,097
	2016 to January 6,	repayable monthly after a 3-year
	2031	grace period
Secured borrowings	From December	The loan is disbursed within three			193,300
	26, 2019 to	years after contract signed;
	December 26,	interest is repayable monthly;
	2026	principal is repayable monthly in
		48 installments with a 3-year
		grace period on principal only
Secured borrowings	From January 6,	Starting from February 6, 2016,
	2016 to January 6,	principal and interest are
	2021	repayable monthly			2,500
				$	716,295
Less: Current portion			(		137,261)
Less: Discount on
government grants			(		3,735)
				$	575,299
Interest rate range					0.75%~1.87%

~43~

Type ofborrowings	Repayment term	December31,2019	December31,2019
Long-term bank
Unsecured borrowings	Starting from December 2019, principal is repayable	$	195,833
	monthly in 48 installments; interest is repayable monthly
Unsecured borrowings	Starting from September 2019, principal is repayable at		87,415
	maturity; interest is repayable quarterly
Unsecured borrowings	Starting from August 2019, principal is repayable		86,666
	quarterly in 15 installments; interest is repayable monthly
Unsecured borrowings	Starting from April 2018, principal is repayable quarterly		69,082
	in 13 installments; interest is repayable quarterly
Unsecured borrowings	Starting from October 2016, principal is repayable		20,798
	monthly in 48 installments; interest is repayable monthly
Unsecured borrowings	Starting from October 2018, principal is repayable		20,611
	monthly in 48 installments; interest is repayable monthly
Unsecured borrowings	Starting from August 2018, principal is repayable		14,200
	quarterly in 7 installments; interest is repayable monthly
Unsecured borrowings	Starting from May 2015, principal is repayable monthly in		13,333
	60 installments; interest is repayable monthly
Unsecured borrowings	Starting from December 2022, principal is repayable		11,500
	monthly in 48 installments; interest is repayable monthly
Unsecured borrowings	Starting from September 2017, principal is repayable		10,849
	quarterly in 12 installments; interest is repayable quarterly
Secured borrowings	Starting from January 2019, principal is repayable		323,264
	monthly in 144 installments; interest is repayable monthly
Secured borrowings	Starting from February 2016, Principal is repayable
	monthly in 60 installments; interest is repayable monthly		32,500
		$	886,051
Less: Current portion		(	248,665)
		$	637,386
Interest rate range
Unsecured borrowings			0.75%~4.59%
Secured borrowings			1.14%~1.19%

(16) Government grants

As of December 31, 2020, the Group obtained government concessional loans under the "Action Plan for Welcoming Overseas Taiwanese Businesses to Return to Invest in Taiwan” from the Bank of Taiwan in the amounts of $193,300 thousand and $18,300 thousand, respectively, for supporting capital expenditure and working capital. Such loans will mature in December 2026. The fair values for the loans were $188,842 thousand and $17,871 thousand, respectively which were calculated at a market rate of 1.25%. The differences between the amount obtained and the fair value were $4,458 thousand and $429 thousand, respectively, which were deemed as a low interest loan subsidy from government and recognised in deferred revenue (shown as other non-current liabilities). The deferred revenue is reclassified to other income on a straight-line basis over their estimated useful life during the period of paying interest.

~44~

(17) Pensions

• A. (a) The Company and its domestic subsidiaries have a defined benefit pension plan in accordance with the Labor Standards Act, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company and its domestic subsidiaries contribute monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. Also, the Company would assess the balance in the aforementioned labor pension reserve account by December 31, every year. If the account balance is insufficient to pay the pension calculated by the aforementioned method to the employees expected to qualify for retirement in the following year, the Company will make contributions for the deficit by next March.

• (b) The amounts recognised in the balance sheet are as follows:

		December	31,2020		December	31,2019
Present value of defined benefit obligations		$	19,078		$	18,708
Fair value of plan assets	(		12,412)	(		11,713)
Net defined benefit liability		$	6,666		$	6,995

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(c) Movements in net defined benefit liabilities are as follows:

		YearendedDecember31,2020	YearendedDecember31,2020	YearendedDecember31,2020	YearendedDecember31,2020	YearendedDecember31,2020	YearendedDecember31,2020
		Present value
		of defined		Fair value of		Net defined		benefit
	benefit obligations				planassets		liability
Balance at January 1	$	18,708	($		11,713)		$	6,995
Interest expense (income)		117	(		74)			43
		18,825	(		11,787)			7,038
Remeasurements:
Return on plan assets (excluding
amounts included in interest		-	(		396)	(		396)
income or expense)
Change in demographic assumptions		26			-			26
Change in financial assumptions		322			-			322
Experience adjustments	(	95)			-	(		95)
		253	(		396)	(		143)
Pension fund contribution		-	(		229)	(		229)
Balance at December 31	$	19,078	($		12,412)		$	6,666
		YearendedDecember31,2019
		Present value
		of defined		Fair value of		Net defined		benefit
	benefit obligations				planassets		liability
Balance at January 1	$	18,334	($		10,995)		$	7,339
Interest expense (income)		160	(		97)			63
		18,494	(		11,092)			7,402
Remeasurements:
Return on plan assets (excluding
amounts included in interest		-	(		398)	(		398)
income or expense)
Change in demographic assumptions		35			-			35
Change in financial assumptions		347			-			347
Experience adjustments	(	168)			-	(		168)
		214	(		398)	(		184)
Pension fund contribution		-	(		223)	(		223)
Balance at December 31	$	18,708	($		11,713)		$	6,995

(d) The Bank of Taiwan was commissioned to manage the fund of the Company’s defined benefit pension plan assets in accordance with the Fund’s annual investment and utilisation plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilisation of the Labor

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Retirement Fund” (Article 6: The scope of utilisation for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-thecounter, or private placement equity securities, investment in domestic or foreign real estate securitisation products, etc.). With regard to the utilisation of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. If the earnings is less than aforementioned rates, government shall make payment for the deficit after being authorised by the Regulator. The Company has no right to participate in managing and operating that Fund and therefore, the Company is unable to disclose the classification of plan assets fair value in accordance with IAS 19 paragraph 142. The composition of fair value of plan assets as of December 31, 2020 and 2019 is given in the Annual Labor Retirement Fund Utilisation Report announced by the government.

• (e) The principal actuarial assumptions used were as follows:

Discount rate Future salary increases	December 31, 2020 0.375% 2.25%	December31,2019
		0.625%
		2.25%

Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience in each territory.

Sensitivity analysis of the effect on present value of defined benefit obligation due from the changes of main actuarial assumptions was as follows:

		Discount rate	Discount rate			Future salaryincreases	Future salaryincreases
	Increase	0.25%	Decrease	0.25%	Increase 0.25%		Decrease 0.25%
December 31, 2020
Effect on present value
of defined benefit
obligation	($	322)	$	333	$	322	($	313)
December 31, 2019
Effect on present value
of defined benefit
obligation	($	347)	($	358)	$	347	($	338)

The sensitivity analysis above is based on other condition that are unchanged but only one assumption is changed. In practice, more than one assumption may change all at once. The method utilised in sensitivity analysis is the same as the method utilised in calculating net pension liability on the balance sheet.

The methods and types of assumptions used in preparing the sensitivity analysis wer e consistent with previous period.

• (f) Expected contributions to the defined benefit pension plans of the Group for the year ending December 31, 2021 amount to $237.

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• (g) As of December 31, 2020, the weighted average duration of that retirement plan is 6.8 years. The analysis of timing of the future pension payment was as follows:

  • Within 1 year $ 422 1-2 year(s) 464 2-5 years 13,816 Over 5 years 617 $ 15,319

• B.(a) Effective July 1, 2005, the Company has established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company contributes monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.

• (b) The Company’s mainland China subsidiaries, have a defined contribution plan. Monthly contributions to an independent fund administered by the government in accordance with the pension regulations in the People’s Republic of China (PRC) are based on certain percentage of employees’ monthly salaries and wages. The contribution percentage for the years ended December 31, 2020 and 2019 were both 20%. Other than the monthly contributions, the Group has no further obligations.

• (c) The notices of People's Republic of China, No. 11 2020, Ministry of Human Resources and Social Security and No. 49 2020 of the Ministry of Human Resources and Social Security provide for the temporary reduction and exemption of enterprises’ contributions to basic pension insurance, unemployment insurance, and work-related injury insurance schemes (hereinafter referred to as “three social insurance schemes”) as of February 2020, reduced the burdens of enterprises, and providing strong support for enterprises' resumption of work and production.

• (d) The pension costs under the defined contribution pension plan of the Group for the years ended December 31, 2020 and 2019 were $7,379 and $22,401, respectively.

• (18) Share capital

• A. As of December 31, 2020, the Company’s authorised capital was $1,000,000, constituting 100,000 thousand shares and the paid-in capital was $741,389 with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected.

• (a) Movements in the number of the Company’s ordinary shares outstanding are as follows:

Expressed in thousand shares Year ended December 31, 2020 Number of shares as of beginning and end of the year 74,124

(b) On December 31, 2019, the number of outstanding shares was as follows:

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Expressed in thousand shares Year ended December 31, 2019

Number of shares as of beginning and end of the year 74,139

• B. Treasury shares

• (a) Reason for share reacquisition and movements in the number of the Company’s treasury shares are as follows:

Name of company holding the shares	Reason for reacquisition		December	December	31,2020		December31,2019	December31,2019
			Number of thousand shares		Carrying amount		Number of thousand shares	Carrying amount
The Company	To be reissued to employees		15		526 $		15	526 $

• (b) Pursuant to the R.O.C. Securities and Exchange Act, the number of shares bought back as treasury share should not exceed 10% of the number of the Company’s issued and outstanding shares and the amount bought back should not exceed the sum of retained earnings, paid-in capital in excess of par value and realised capital surplus.

• (c) Pursuant to the R.O.C. Securities and Exchange Act, treasury shares should not be pledged as collateral and is not entitled to dividends before it is reissued.

• (d) Pursuant to the R.O.C. Securities and Exchange Act, treasury shares should be reissued to the employees within five years from the reacquisition date and shares not reissued to be retired. Treasury shares to enhance the Company’s credit rating and the stockholders’ equity should be retired within six months of acquisition.

• (e) In order to encourage employees and retain the professionals, on November 9, 2018, the Board of Directors resolved to repurchase shares and reissue it to employees. In January 2019, the Company continuously repurchased 15 thousand shares (the carrying amount was $526).

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(19) Capital surplus

Pursuant to the R.O.C. Company Act, capital surplus arising from paid-in capital in excess of par value on issuance of common stocks and donations can be used to cover accumulated deficit or to issue new stocks or cash to shareholders in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Act requires that the amount of capital surplus to be capitalised mentioned above should not exceed 10% of the paid-in capital each year. However, capital surplus should not be used to cover accumulated deficit unless the legal reserve is insufficient.

December 31, 2020 December 31, 2019

• Used to offset deficits, distributed as cash dividends or transferred to share capital (Note 1) Additional paid-in capital in excess of par-ordinary share $ 1,163,298 $ 1,158,876 Difference between consideration and carrying amount of subsidiaries acquired $ 2,035 $ 2,035 Used to offset accumulated deficits only (Note 2) Changes in ownership interests $ 27,926 $ 27,691

• in subsidiaries Not for any other purposes Employee stock options $ - $ 4,422

• Note 1: Such capital surplus can be used in offsetting deficit and distributed as cash dividends or transferred to capital provided that the Company has no deficit. However, the amount that can be transferred to capital is limited to a certain percentage of paid-in capital every year.

• Note 2: Such capital surplus arises from the effect of changes in ownership interests in subsidiaries under equity transactions when there is no actual acquisition or disposal of subsidiaries by the Company, or from changes in capital surplus of subsidiaries.

(20) Retained earnings

• A. According to the Company’s Articles of Incorporation, the current year’s earnings, if any, shall first be used to pay all taxes and offset against prior years’ operating losses and then be distributed as follows: 10% as legal reserve, and appropriate or reverse for special reserve until the legal reserve equals the Company’s paid-in capital. The remaining earnings, if any, may be appropriated along with the accumulated unappropriated earnings according to a resolution proposed by the Board of Directors and resolved by the shareholders’ meeting.

• B. The Company retains some earnings after taking into account the environment, growth stage and long-term financial plan of the Company, and the reminder along with the accumulated unappropriated earnings of prior years can be distributed as shareholders’ bonus, of which the

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cash bonus shall exceed 20% of total shareholders’ bonus, by the Board of Directors depending on the current capital position and the economic development.

• C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.

• D. (a) In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.

• (b) The amounts previously set aside by the Company as special reserve in accordance with Order No. Financial-Supervisory-Securities-Corporate-1010012865, dated April 6, 2012, shall be reversed proportionately when the relevant assets are used, disposed of or reclassified subsequently. Such amounts are reversed upon disposal or reclassified if the assets are investment property of land, and reversed over the use period if the assets are investment property other than land.

• E. The appropriation of 2019 earnings as approved by the stockholders resolved on May 29, 2020 and the appropriation of 2018 earnings had been approved by the shareholders during their meeting on May 29, 2019. Details summarised below:

Legal reserve appropriated Special reserve appropriated Cash dividend		Dividend per share(in dollars) Amount Dividend per share(in dollars) 30,790 $ 48,458 2.00 $ 148,248 2.00 $ Years endedDecember31, 2019 2018	Dividend per share(in dollars) Amount Dividend per share(in dollars) 30,790 $ 48,458 2.00 $ 148,248 2.00 $ Years endedDecember31, 2019 2018
	Amount		Dividend per share(in dollars)
	37,634 $ 31,421 148,248		2.00 $

• F. The appropriation of 2020 earnings proposed by the Board of Directors on March 16, 2021 is as follows:

follows:
			Year ended December31,2020
					Dividend per
			Amount		share (indollars)
Legal reserve		$	11,779
(Reversal of) special reserve	(		14,269)
Cash dividends			148,248	$	2.00

As of March 16, 2021, the appropriation of 2020 earnings has not yet been resolved at the shareholders’ meeting.

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• G. Refer to Note 6 (28) for further information relating to employees’ compensation and directors’ and supervisors’ remuneration.

• (21) Operating revenue

• A. Disaggregation of revenue from contracts with customers

The Group derives revenue primarily from the transfer of goods at a point in time in the following products:

products:
Auto parts Others Auto parts Others	Domestic operations Overseas operations Total $ 1,181,469 $ 886,460 2,067,929 $ 28,599 24,373 52,972 $ 1,210,068 $ 910,833 2,120,901 $ 2,643,630 $ 11,157 2,654,787 $ YearendedDecember31,2020 YearendedDecember31,2019 Total
		2,643,630 $ 11,157 2,654,787 $

• B. Contract liabilities

The Group has recognised the following revenue-related contract liabilities:

December 31, 2020

Contract liabilities:

Contract liabilities - advance sales receipts $ 20,177

• (a) As of December 31, 2019 and January 1, 2019, the contractual liabilities were $14,326 and $28,641, respectively, shown as ‘other current liabilities’.

• (b) For the year ended December 31, 2020, revenue recognised that was included in the contract liability balance at the beginning of the year amounted to $9,233.

• (22) Interest income

Interest income
Interest income from bank deposits	Years ended December31,
	2020 8,105 $	2019
		23,378 $

(23) Other income

Other income
Rent income Dividend income Other income - others	Years ended December31,
	2020 5,029 $ 4,036 12,213 21,278 $	2019
		10,795 $ 4,797 50,619
		66,211 $

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(24) Other gains and losses

Years ended December 31,

			2020			2019
Gains on disposal of property, plant and equipment		$	246		$	29
Foreign exchange (losses) gains	(		93,070)			9,640
Losses on financial assets and liabilities at fair value through profit or loss	(		5,912)	(		1,628)
Impairment loss	(		84,794)	(		76,013)
Other losses	(		1,373)	(		6,158)
	($		184,903)	($		74,130)

(25) Finance costs

Finance costs	Finance costs	Finance costs	Finance costs
Expenses by nature 2020 2019 Interest expense 19,559 $ 33,155 $ Less: Capitalization of qualifying assets 3,333) ( 3,749) ( 16,226 $ 29,406 $ Years ended December 31, Classified as Classified as Operating Costs OperatingExpenses Total Employee benefit expense 235,797 $ 86,176 $ 321,973 $ Depreciation charges on property, plant and equipment 282,080 15,445 297,525 Depreciation charges on right-of- use assets 2,360 2,384 4,744 Depreciation charges on investment property - 918 918 Amortisation 7,143 3,170 10,313 527,380 $ 108,093 $ 635,473 $ Classified as Classified as Operating Costs OperatingExpenses Total Employee benefit expense 279,091 $ 83,778 $ 362,869 $ Depreciation charges on property, plant and equipment 294,223 18,806 313,029 Amortisation 8,676 3,543 12,219 581,990 $ 106,127 $ 688,117 $ Year ended December31,2020 YearendedDecember31,2019
	Classified as Classified as Operating Costs OperatingExpenses Total 235,797 $ 86,176 $ 321,973 $ 282,080 15,445 297,525 2,360 2,384 4,744 - 918 918 7,143 3,170 10,313 527,380 $ 108,093 $ 635,473 $ YearendedDecember31,2019		Total
			321,973 $ 297,525 4,744 918 10,313
			635,473 $
	Classified as Operating Costs 279,091 $ 294,223 8,676 581,990 $	Classified as OperatingExpenses 83,778 $ 18,806 3,543 106,127 $	Total
			362,869 $ 313,029 12,219
			688,117 $

(26) Expenses by nature

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(27) Employee benefit expense

Employee benefit expense
Wages and salaries Labour and health insurance fees Pension costs Directors’ remuneration Other personnel expenses Short-term employee benefits Pension costs Other employee benefits	Classified as Classified as Operating Costs OperatingExpenses 203,481 $ 68,341 $ 14,290 4,767 5,166 2,256 - 4,010 12,860 6,802 235,797 $ 86,176 $ Year ended December31,2020 Year ended December 31, 2019		Total 271,822 $ 19,057 7,422 4,010 19,662 321,973 $
	Classified as Operating Costs 236,790 $ 18,355 23,946 279,091 $	Classified as OperatingExpenses 71,874 $ 4,269 7,635 83,778 $	Total 308,664 $ 22,624 31,581
			362,869 $

• A. Under the Company’s Articles of Incorporation, the current year’s earnings, if any, shall appropriate 1%~3% for employees’ compensation and no higher than 3% for directors’ remuneration. If the Company has accumulated deficit, earnings should be reserved to cover losses and then be appropriated as employees’ compensation and directors’ remuneration based on the abovementioned ratios.

• B. For the years ended December 31, 2020 and 2019, the accrued employees’ compensation and directors’ remuneration were as follows:

directors’ remuneration were as follows:
Employees’ compensation Directors’ remuneration	Years ended December 31,
	2020 5,309 $ 4,010 9,319 $	2019
		6,197 $ 4,767
		10,964 $

For the years ended December 31, 2020 and 2019, the employees’ compensation and directors’ remuneration were estimated and accrued based on 2.86% and 1.3% as well as 2.16% and 1%, respectively, of distributable profit of current year as of the end of reporting period.

• C. Employees’ compensation and directors’ remuneration of 2019 as resolved by the Board of Directors were in agreement with those amounts recognised in the 2019 financial statements.

• D. Information about employees’ compensation and directors’ remuneration of the Company as resolved at the meeting of Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

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(28) Income tax

A. Income tax expense

• (a) Components of income tax expense

e tax ome tax expense Components of income tax expense
		Years ended	December31,
		2020		2019
Current tax:
Current tax on profits for the year	$	56,712	$	116,435
Tax on undistributed surplus earnings		7,992		3,973
Prior year income tax overestimation	(	1,615)		-
Total current tax		63,089		120,408
Deferred tax:
Origination and reversal of
temporary differences	(	4,005)	(	30,210)
Income tax expense	$	59,084	$	90,198

• (b) The income tax (charge)/credit relating to components of other comprehensive income is as follows:

	Years ended	December 31,
	2020	2019
Remeasurement of defined benefit obligations	28) ($	37) ($

• B. Reconciliation between income tax expense and accounting profit

			Years ended	December31,
			2020	2019
Tax calculated based on profit before tax and statutory tax rate		$	32,248	$	92,605
Expenses disallowed by tax regulation			712		1,946
Tax exempt income by tax regulation	(		4,624)	(	8,211)
Temporary differences not recognised as deferred tax assets			18,095		-
Taxable loss not recognised as deferred tax assets			3,283		27,786
Change in assessment of realisation of deferred tax assets			2,993		-
Prior year income tax overestimation	(		1,615)	(	1,338)
Tax on undistributed surplus earnings			7,992		3,973
Effect of different tax rates in countries in which the group operates			-	(	25,563)
Income tax expense		$	59,084	$	91,198

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• C. Details of the Group’s applicable tax rate are as follows:

Entity	Tax application and applicable tax rate
Taiwan parent company and Taiwan subsidiaries	Applicable tax rate:20%
	Applicable tax rate:15%, and the
CHANGSHU FUTE AUTOMOTIVE TRIM CO.,LTD	preferential income tax rate for Hi-Tech
	Enterprises has been adopted since 2018
Other China subsidiaries	Applicable tax rate:25%

• D. Amounts of deferred tax assets or liabilities as a result of temporary differences, tax losses and investment tax credits are as follows:

Deferred tax assets: Allowance for inventory valuation and obsolescence losses Allowance for bad debts Unrealised exchange loss Losses on valuation of financial instruments at fair value through profit or loss Defined benefit plan Share of profit (loss) of subsidiaries accounted for under the equity method Others	Recognised in January1 profit or loss 8,309 $ 990 $ 7,241 1,606) ( 7,238 1,652 1,348 4,113 1,587 37) ( 83,576 3,013) ( 2,011 1,684 111,310 $ 3,783 $	Recognised in other comprehensive income - $ - - - 28) ( - - 28) ($ 2020	Net exchange differences December31 102 $ 9,401 $ 92 5,727 - 8,890 - 5,461 - 1,522 - 80,563 28 3,723 222 $ 115,287 $

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Deferred tax assets: Allowance for inventory valuation and obsolescence losses Allowance for bad debts Unrealised exchange loss Losses on valuation of financial instruments at fair value through profit or loss Defined benefit plan Share of profit (loss) of subsidiaries accounted for under the equity method Others		2019	Net exchange differences December31 248) ($ 8,309 $ 252) ( 7,241 - 7,238 - 1,348 - 1,587 - 83,576 38) ( 2,011 538) ($ 111,310 $
	Recognised in January1 profit or loss 9,563 $ 1,006) ($ 7,712 219) ( 2,550 4,688 1,219 129 1,624 - 56,993 26,583 2,014 35 81,675 $ 30,210 $	Recognised in other comprehensive income - $ - - - 37) ( - - 37) ($

E. Expiration dates of unused tax losses and amounts of unrecognised deferred tax assets are as follows:

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

December 31, 2020
Initially Unrecognised
Year Amount filed/ creditable Unused deferred tax Expiry
incurred assessed amount amount assets year
2018 Assessed $ 70,910 $ 70,910 $ 70,910 2028
2019 Assessed 35,075 35,075 35,075 2029
Amount
2020 2030
estimated to file 21,699 21,699 21,699
$ 127,684 $ 127,684 $ 127,684
----- End of picture text -----

For the year ended December 31, 2019, unused loss carryforward under deferred tax assets which was not recognised in the consolidated balance sheet is as follows:

was not recognised in the consolidated balance sheet is as follows:
Loss carryforward Matured in 2023 Matured in 2024	Amount
	70,910 $ 68,023
	138,933 $

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• F. The amounts of deductible temporary difference that are not recognised as deferred tax assets are as follows:

Deductible temporary differences

December 31, 2020 $ 163,265

• G. The Company’s and domestic subsidiaries’ income tax returns through 2018 have been assessed and approved by the Tax Authority.

• H. The Company incurred an income tax of $48,654 from the 2019 profit-seeking enterprise income tax (including the filing of unappropriated retained earnings of 2018), and applied for the installment payments in accordance with Article 26 of the Tax Collection Act and Decree No.10904533690 issued by the Ministry of Finance, R.O.C. on March 19, 2020. As of December 31, 2020, the unpaid instalment payments of $35,985 thousand were recognised as income tax liabilities - current and income tax liabilities -non-current.

(29) Earnings per share

Earnings per share of ordinary shares:

Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares -Employees’ compensation Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares	Year ended December31,2020	Year ended December31,2020
	Weighted average number of ordinary shares outstanding Amount aftertax (shareinthousands) 117,679 $ 74,124 117,679 74,124 - 148 117,679 $ 74,242	Earnings per share (indollars)
		1.59 $
		1.58 $

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

Year ended December 31, 2019
Weighted average
number of ordinary Earnings per
shares outstanding share
Amount after tax (share in thousands) (in dollars)
Basic earnings per share
Profit attributable to ordinary
shareholders of the parent $ 376,363 74,124 $ 5.08
Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent 376,363 74,124
Assumed conversion of all
dilutive potential ordinary shares
-Employees’ compensation - 142
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all dilutive
potential ordinary shares $ 376,363 74,266 $ 5.07
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(30) Transactions with non-controlling interest

• A. In May 2019, the Group acquired an additional 20% of shares of its subsidiary - UNITED SKILLS for a total cash consideration of $32,863. The carrying amount of non-controlling interest in UNITED SKILLS was $34,898 at the acquisition date. The shareholding ratio of the Group in UNITED SKILLS increased 80% to 100% from that date. This transaction that did not result in a change in the Group’s control over UNITED SKILLS is accounted for as equity transaction. The effect on the equity attributable to owners of the parent is shown below:

Carrying amount of non-controlling interest acquired Consideration paid to non-controlling interest Capital surplus - difference between proceeds on actual acquisition of or disposal of equity interest in a subsidiary and its carrying amount	Year ended December31,2019
	34,898 $ 32,863) ( 2,035 $

• B. To meet the development requirement of the Group’s overall operation, the Board of Directors resolved to increase its capital in the subsidiary, RISE BRIGHT in the amount of US$2 million (NT$57,360 thousand) on August 11, 2020, and then reinvested in CHANG JIE without proportion to its ownership, resulting in a increase in capital surplus in the amount of 235 thousand.

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(31) Supplemental cash flow information

Investing activities with partial cash payments:

Supplemental cash flow information Investing activities with partial cash payments:
			Year ended December 31, 2020
Purchase of property, plant and equipment		$	143,569
Add: Opening balance of payable on equipment			30,021
Less: Ending balance of payable on equipment	(		34,547)
Cash paid during the year		$	139,043

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(32) Changes in liabilities from financing activities

Short-term borrowings At January 1, 2020 254,868 $ Changes in cash flow from financing activities 78,889 Impact of changes in foreign exchange rate 6,198 Changes in other non-cash items 6,559) ( At December 31, 2020 333,396 $ Short-term borrowings At January 1, 2019 593,465 $ Additions for the period 335,182) ( Changes in cash flow from financing activities - Impact of changes in foreign exchange rate 3,415) ( At December 31, 2019 254,868 $	Short-term borrowings At January 1, 2020 254,868 $ Changes in cash flow from financing activities 78,889 Impact of changes in foreign exchange rate 6,198 Changes in other non-cash items 6,559) ( At December 31, 2020 333,396 $ Short-term borrowings At January 1, 2019 593,465 $ Additions for the period 335,182) ( Changes in cash flow from financing activities - Impact of changes in foreign exchange rate 3,415) ( At December 31, 2019 254,868 $	Short-term borrowings 254,868 $ 78,889 6,198 6,559) ( 333,396 $ Short-term borrowings	Long-term borrowings (including current portion)	Dividends payable		Guarantee deposits received	Guarantee deposits received	Guarantee deposits received
			886,051 $ 164,607) ( 3,838) ( 1,311) ( 716,295 $ Long-term borrowings (including current portion)			$
						$
	593,465 $ 335,182) ( - 3,415) ( 254,868 $		1,510,660 $ 618,773) ( - 5,836) ( 886,051 $	- $ 148,248 148,248) ( - - $				541 $ - - 20) ( 521 $

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7. Related Party Transactions

(1) Names of related parties and relationship

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Names of related parties Relationship with the Company
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Names of related parties	Relationship with the Company
YU, CHE-MING	Other related party (Note)
DONGGUAN HIROSAWA AUTOMOTIVE TRIM CO., LTD.	Other related party (Note)
LOFTY SUCCESS GROUP LIMITED	Other related party (Note)

Note: It is no longer a related party after the Group purchased non-controlling interests of UNITED SKILLS on May 13, 2019.

(2) Significant related party transactions

Operating revenue

Sales of goods: - Other related parties	2020 2019 - $ 310 $ Years endedDecember31,

Goods are sold based on the price that would be available to general customers. The credit terms to related parties and general customer are 30~90 days and 30~180 days after the monthly billings, respectively.

(3) Key management compensation

respectively. Key management compensation
Salaries and other short-term employee benefits Post-employment benefits	Years ended December 31,
	2020 20,057 $ 35 20,092 $	2019
		19,314 $ 52
		19,366 $

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8. Pledged Assets

The Group’s assets pledged as collateral are as follows:

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Book value
Pledged asset December 31, 2020 December 31, 2019 Purpose
Property, plant and equipment $ 1,119,594 $ 700,097 Short-term borrowings and
long-term borrowings
-
Right-of-use assets 82,359 Short-term borrowings
-
Investment property 16,506 Short-term borrowings
Other financial assets (shown as other 26,213 33,940 Guarantee for acceptance bill
current assets)
Other non-current assets - 89,940 Long-term borrowings
Guarantee deposits paid (shown as - 300 Natural gas for manufacturing
other non-current assets)
Financial assets at amortised cost - Natural gas for manufacturing
non-current (shown as other non-
current assets) 300 -
$ 1,244,972 $ 824,277
----- End of picture text -----

9. Significant Contingent Liabilities and Unrecognised Contract Commitments

(1) Contingencies

None.

(2) Commitments

As at December 31, 2020 and 2019, the Group’s capital expenditure contracted but not yet incurred in respect of machinery and equipment as well as construction of plants were $283,771 and $213,559, respectively.

10. Significant Disaster Loss

None.

11. Significant Events after the Balance Sheet Date

None.

12. Others

(1) Capital management

• A. The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to maximise returns for shareholders and to optimise the balance of liabilities and equity.

• B. The Group’s capital structure comprises net liabilities (borrowings net of cash and cash equivalents) and equity (common shares, capital surplus, retained earnings, other equity interest and non-controlling interests).

• C. The Group has no obligation to comply with any external capital requirements.

• D. The key management of the Group monitors the capital structure every year, including capital costs and related risks, and the Group may adjust capital structure by paying dividends to shareholders, issuing new shares, buying shares back and issuing new bonds or repaying old

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bonds based on the advices from the management.

(2) Financial instruments

A. Financial instruments by category

bonds based on the advices from the management. nancial instruments Financial instruments by category
Financial assets Financial assets at fair value through profit or loss Financial assets mandatorily measured at fair value through profit or loss Financial assets at fair value through other comprehensive income Designation of equity instruments Financial assets at amortised cost Cash and cash equivalents Financial assets at amortised cost Notes receivable Accounts receivable Other receivables Other financial assets - current Other financial assets - non-current Guarantee deposits paid Financial liabilities Financial liabilities at fair value through profit or loss Financial liabilities held for trading Financial liabilities at amortised cost Short-term borrowings Notes payable Accounts payable Other payables Long-term borrowings (including current portion) Guarantee deposits received Lease liabilities (including current portion)	December31,2020 18,301 $ 52,241 $ 585,276 $ 418,192 29,553 591,658 3,579 26,213 - 2,278 1,656,749 $ December31,2020 27,305 $ 333,396 $ 118,492 251,103 134,314 716,295 935 1,554,535 $ 2,931 $	December31,2019
		42,045 $
		57,542 $
		700,630 $ 74,950 22,880 757,449 6,547 33,940 89,940 1,445
		1,687,781 $
		December31,2019
		6,742 $
		254,868 $ 113,429 247,776 168,141 886,051 521
		1,670,786 $
		- $

B. Financial risk management policies

(a) The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk and interest rate risk), credit risk and liquidity risk. To minimise any adverse effects on the financial performance of the Group, derivative financial instruments, such as foreign exchange forward contracts are used to hedge certain exchange rate risk. Derivatives

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are used for hedging exchange rate risk arising from export proceeds by using forward foreign exchange contracts.

• (b) The Company treasury performs the financial risk management for each business unit. The treasury operates in domestic and international financial markets through planning and coordination, as well as monitors and manages the financial risks related to the Group’s operation based on internal risk reports about exposure to risk with the analysis of the extent and width of risk.

  • The Board of Directors of the Group supervises the compliance by the management with financial risk policy and procedure, and reviews the appropriateness of structure of financial risk related to the Company. The internal auditors act as supervisors to assist the Board of Directors of the Company by conducting regular and irregular reviews, and report the results to the Board of Directors.

• (c) Information about derivative financial instruments that are used to hedge certain exchange rate risk are provided in Note 6(2).

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

Foreign exchange risk

• i. The Group operates internationally and is exposed to foreign exchange risk arising from the transactions of the Company and its subsidiaries used in various functional currency, primarily with respect to the United States Dollar and Chinese Renminbi. Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities.

• ii. The companies within the Group are required to hedge their entire foreign exchange risk exposure with the Group treasury. Exchange rate risk is measured through a forecast of highly probable United States Dollar and Chinese Renminbi expenditures. Entities of the Group use natural hedge to decrease the risk exposure in the foreign currency through the Group treasury.

• iii. The Group’s businesses involve some non-functional currency operations (the Company’s functional currency: New Taiwan Dollars; certain subsidiaries’ functional currency: United States Dollar and Chinese Renminbi). The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations and analysis of foreign currency market risk arising from significant foreign exchange variation is as follows:

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==> picture [430 x 444] intentionally omitted <==

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

December 31, 2020
Foreign
currency
amount Book value
(In thousands) Exchange rate (NTD)
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD : NTD $ 31,959 28.48 $ 910,192
RMB : NTD 1,684 4.337 7,371
USD : RMB 916 6.52 5,972
Financial liabilities
Monetary items
USD : RMB $ 3,265 6.52 $ 21,288
December 31, 2019
Foreign
currency
amount Book value
(In thousands) Exchange rate (NTD)
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD : NTD $ 40,986 29.98 $ 1,228,762
Financial liabilities
Monetary items
USD : NTD $ 10,211 29.98 $ 306,132
----- End of picture text -----

vi. The total exchange (loss) gain, including realised and unrealised, arising from significant foreign exchange variation on the monetary items held by the Group for the years ended December 31, 2020 and 2019, amounted to ($93,070) and $9,640, respectively.

vii. Analysis of foreign currency market risk arising from significant foreign exchange variation:

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(Foreign currency: functional currency) Financial assets Monetary items USD : NTD RMB : NTD USD : RMB Financial liabilities Monetary items USD : RMB	Degree of Effect on other comprehensive variation Effect onprofit or loss income 1% 9,102 $ - $ 1% 74 - 1% 60 1% 213 $ - $ YearendedDecember31,2020 Sensitivity analysis Year ended December 31, 2019	Degree of Effect on other comprehensive variation Effect onprofit or loss income 1% 9,102 $ - $ 1% 74 - 1% 60 1% 213 $ - $ YearendedDecember31,2020 Sensitivity analysis Year ended December 31, 2019
	Sensitivity analysis
	Degree of variation Effect on profit or loss	Effect on other comprehensive income

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD 1% $ 12,288 $ - Financial liabilities Monetary items USD : NTD 1% $ 3,061 $ -

Price risk

• i. The Group’s equity securities, which are exposed to price risk, are the held financial assets (liabilities) at fair value through profit or loss and financial assets at fair value through other comprehensive income. To manage its price risk arising from investments in equity securities, the Group diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the Group.

• ii. The Group’s investments in equity securities comprise shares issued by the domestic companies. The prices of equity securities would change due to the change of the future value of investee companies. If the prices of these equity securities had increased/decreased by 1% with all other variables held constant, per-tax profit for the years ended December 31, 2020 and 2019 would have decreased/increased by $183 and $420 , respectively, as a result of losses/gains on equity securities classified as at fair value through profit or loss. Other components of equity would have increased/decreased by $522 and $575,

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respectively, as a result of other comprehensive income classified as equity investment at fair value through other comprehensive income.

Cash flow and fair value interest rate risk

• i. The Group’s main interest rate risk arises from short-term and long-term borrowings with variable rates, which expose the Group to cash flow interest rate risk. During years ended December 31, 2020 and 2019, the Group’s borrowings at variable rate were mainly denominated in New Taiwan Dollars and United States Dollars.

• ii. If the borrowing interest rate had increased/decreased by 0.1% with all other variables held constant, profit before tax for the years ended December 31, 2020 and 2019 would have increased/decreased by $1,050 and $1,141, respectively. The main factor is that changes in interest expense result in floating-rate borrowings.

• (b) Credit risk

• i. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments on the contract obligations. The main factor is that counterparties could not repay in full the accounts receivable based on the agreed terms, and the contract cash flows of equity instruments stated at amortised cost, at fair value through profit or loss and at fair value through other comprehensive income.

• ii. For banks and financial institutions, after reviewing deposit ratings, only the counterparties with good credit quality are accepted. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analysing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. The utilisation of credit limits is regularly monitored.

• iii.The Group adopts credit risk management procedure to assess whether there has been a significant increase in credit risk on that instrument since initial recognition. If the contract payments were past due over 3 months based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition.

• iv.In line with credit risk management procedure, the default occurs when the contract payments are past due over 180 days.

• v. Impairment loss is assessed and recognized when there is objective evidence that individual receivables cannot be recovered. The Group used historical and timely information to establish loss rate of remaining receivables and used the forecastability to assess the default possibility of accounts receivable. As of December 31, 2020, accumulated loss allowance provided for individually assessed receivables amounted to $8,681 thousand. The Group used the forecastability to adjust historical and timely information to assess the default possibility of remaining receivables (including notes receivables). On December 31, 2020 and 2019, the provision matrix is as follows:

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		Not past	Not past		0 to 60	0 to 60		61	61	to 120	to 120	121	121	to 180		181	to		Over 241	Over 241	Over 241
			due			days			days				days			240days				days					Total
December 31, 2020
Expected loss rate		0%~3%			10%~13%		30%~35%					90%~97%				100%				100%
Total book value		$	591,747		$	61,842		$			996	$		1,701		2,398 $			$	6,438				665,122 $
Loss allowance	(		17,007)	(		7,427)	(				329)	(		1,631)	(	2,398)		(		6,438)			(		35,230)
		$	574,740		$	54,415		$			667	$		70		$	-		$		-		$		629,892
			0 to 120		121 to 180					181 to 240				241 to		360	Over			360
			days			days					days			days				days						Total
December 31, 2019
Expected loss rate			0%~1%		1%~10%					10%~50%				50%~100%			100%
Total book value		711,666 $			$	61,422				$	20,781			10,092 $			$	19,258				823,219 $
Loss allowance	(		3,814)		(	5,308)			(		6,943)			(	7,567)		(	19,258)			(			42,890)
		$ 707,852			$	56,114			$		13,838			$	2,525		$			-		$780,329

vi. Movements in relation to the Group applying the simplified approach to provide loss allowance for accounts receivable are as follows:

At January 1 Provision for impairment Effect of foreign exchange At December 31 At January 1 Provision (reversal of) impairment Effect of foreign exchange At December 31	Notes receivable Accounts receivable 68 $ 42,822 $ 11 297 - 713 79 $ 43,832 $ Notesreceivable Accountsreceivable $ 137 39,410 $ ( 69) 4,743 - 1,331) ( 68 $ 42,822 $ December31,2020 December 31, 2019	Notes receivable Accounts receivable 68 $ 42,822 $ 11 297 - 713 79 $ 43,832 $ Notesreceivable Accountsreceivable $ 137 39,410 $ ( 69) 4,743 - 1,331) ( 68 $ 42,822 $ December31,2020 December 31, 2019	Total
			42,890 $ 308 713
			43,911 $
		Accountsreceivable 39,410 $ 4,743 1,331) ( 42,822 $	Total
			39,547 4,674 1,331) (
			42,890 $

(c) Liquidity risk

• i. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group treasury. Group treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities.

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ii. The Group has the following undrawn borrowing facilities:

		December31,2020
Fixed rate:
Expiring within one year	$	300,000
Expiring beyond one year		268,400
	$	568,400
		December31,2019
Undrawn borrowing facilities	$	1,398,500

• iii. The table below analyses the Group’s non-derivative financial liabilities and net-settled or gross-settled derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date for nonderivative financial liabilities and to the expected maturity date for derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows.

Non-derivative financial liabilities:

Non-derivative financial liabilities:	bilities:
December 31, 2020 Less than 1year Short-term borrowings 342,076 $ Notes payable 118,492 Accounts payable 251,103 Other payables 134,314 Income tax payable 78,868 Lease liability 622 Long-term borrowings 143,050 Derivative financial liabilities: December 31, 2020 Less than 1year Foreign exchange swap contracts 27,305 $	Less than 1year	Between 1 and 2 years	Between 2 and 3 years	Between 3 and 5 years	Over 5 years	Total
		- $ - - - 15,355 622 115,677 Between 1 and 2 years	- $ - - - 5,275 622 86,515 Between 2 and 3 years	- $ - - - - 1,141 169,295 Between 3 and 5 years	- $ - - - - - 224,663 Over 5 years	342,076 $ 118,492 251,103 134,314 99,498 3,007 739,200 Total
December 31, 2020 Foreign exchange swap contracts
	27,305 $	- $	- $	- $	- $	27,305 $

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Non-derivative financial liabilities:

December 31, 2019

Less than 1year Non-interest bearing liabilities $ 472,355 Floating interest rate liabilities 248,665 Fixed interest rate liabilities 254,868 975,888 $ December 31, 2019 Less than 1year Gross settled foreign exchange contracts - Inflows $ 553,003 - Outflows ( 559,745) 6,742) ($	Over 1year Total $ - $ 472,355 549,972 798,637 87,414 342,282 637,386 $ 1,613,274 $ Over 1year Total - $ 553,003 $ - 559,745) ( - $ 6,742) ($

(3) Fair value information

• A. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:

• Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Group’s investment in listed stocks and over-the-counter stocks is included in Level 1.

• Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The fair value of the Group’s investment in foreign exchange swap contracts is included in Level 2.

• Level 3: Unobservable inputs for the asset or liability.

• B. Fair value information of investment property at cost is provided in Note 6(10).

• C. Financial instruments not measured at fair value

• The carrying amounts of financial instruments not measured at fair value are approximate to their fair value, including cash and cash equivalents, notes receivable, accounts receivable (including related parties), other receivables, financial assets at amortised cost, guarantee deposits paid, short-term borrowings, notes payable, accounts payable (including related parties), other payables, long-term borrowings (including current portion) and guarantee deposits received.

• D. The related information of financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities at December 31, 2020 and 2019 are as follows:

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(a) The related information of natures of the assets and liabilities is as follows:

December 31, 2020 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income - Equity securities Liabilities Recurring fair value measurements Financial liabilities at fair value through profit or loss December 31, 2019 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income - Equity securities Liabilities Recurring fair value measurements Financial liabilities at fair value through profit or loss	Level 1 18,301 $ 52,241 $ - $ Level 1 42,045 $ 57,542 $ - $	Level 2 - $ - $ 27,305 $ Level 2 - $ - $ 6,742 $	Level3 - $ - $ - $ Level3 - $ - $ - $	Total
				18,301 $
				52,241 $
				27,305 $
				Total
				42,045 $
				57,542 $
				6,742 $

• (b) The methods and assumptions the Group used to measure fair value are as follows:

• i. The instruments the Group used market quoted prices as their fair values (that is, Level 1) are listed below by characteristics:

Listed shares Market quoted price Closing price ii. Foreign exchange swap contracts are usually valued based on the current foreign exchange swap rate.

• E. For the years ended December 31, 2020 and 2019, there was no transfer between Level 1 and Level 2.

• F. For the years ended December 31, 2020 and 2019, there was no transfer into or out from Level 3.

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13. Supplementary Disclosures

(1) Significant transactions information

• A. Loans to others: Please refer to table 1.

• B. Provision of endorsements and guarantees to others: Please refer to table 2.

• C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 3.

• D. Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company's paid-in capital: None.

• E. Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more: None.

• F. Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.

• G. Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paidin capital or more: None.

• H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 4.

• I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Notes 6(2) and 12(2).

• J. Significant inter-company transactions during the reporting periods: Please refer to table 5.

(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to table 6.

(3) Information on investments in Mainland China

• A. Basic information: Please refer to table 7.

• B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to Note 13(1).

(4) Major shareholders information: Please refer to table 8.

14. Segment Information

(1) General information

The information provided to the Chief Operating Decision-Maker to allocate resources and evaluate segment performance focuses on area of operations. The Group is primarily engaged in manufacture of parts for the interior and exterior of automobiles and manages the business from a geographic perspective due to the difference characteristics in culture, environment and economic although the manufacture process and marketing strategy are the same throughout the operations. The reportable segments are as follows:

Domestic operation area - domestic consolidated entities.

Foreign operation area - foreign consolidated entities.

(2) Measurement of segment information

The evaluates the performance of the operating segments based on a measure of adjusted profit from operations. This measurement basis excludes the effects of non-recurring expenditure from the

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operating segments.

(3) Information about segment profit or loss, assets and liabilities

The segment information provided to the Chief Operating Decision-Maker for the reportable segments are as follows:

segments are as follows:
Domestic operations Foreign operations Inter-segment eliminations Others Total amount from continuing operations Interest income Rent income Dividend income Other income - others Impairment loss Foreign exchange (losses) gains Loss on financial assets and liabilities at fair value through profit or loss Gains on disposal of property, plant and equipment Other losses Finance costs Profit before income tax
		Year ended December 31, 2020			Year ended December 31, 2020
	1,235,681 $ 978,209 145,961) ( 52,972 2,120,901 $		1,475,013 $ 1,245,558 76,942) ( 11,158 2,654,787 $	332,858 $ 15,225) ( 32,810 - 350,443 8,105 6,453 4,036 10,789 84,794) ( 93,070) ( 5,912) ( 246 1,373) ( 16,226) ( 178,697 $		494,215 $ 51,519) ( 32,404 1,873 476,973 23,378 10,795 4,797 50,619 76,013) ( 9,640 1,628) ( 29 6,158) ( 29,406) ( 463,026 $

(4) Information on products

Please refer to Note 6 (21) for the related information.

(5) Geographical information

Geographical information for the years ended December 31, 2020 and 2019 is as follows:

Taiwan China Others			2020	2020		2019	2019	2019
		Revenue		Non-current assets		Revenue		Non-current assets
		1,207,487 $ 883,568 29,846 2,120,901 $		2,243,954 $ 848,902 - 3,092,856 $		1,468,336 $ 1,145,404 41,047 2,654,787 $		2,307,245 $ 706,074 146,175 3,159,494 $

Revenue was calculated based on geographic location of segments. Non-current assets were classified based on geographic location of assets, including property, plant and equipment, intangible assets and other non-current assets but excluding financial instruments, guarantee deposits paid and

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deferred income tax. Geographical information for the years ended December 31, 2020 and 2019 is stated as above.

(6) Major customer information

Major customer information of the Group for the years ended December 31, 2020 and 2019 is as follows:

follows:
			Years ended	December31,
			2020			2019
		Revenue	Segment		Revenue	Segment
A Group	$	358,895	Domestic operations	$	719,906	Domestic operations
B customer		102,167	Foreign operations		308,568	Foreign operations
	$	461,062		$	1,028,474

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Y.C.C. PARTS MFG. CO., LTD. and subsidiaries

Loans to others

Year ended December 31, 2020

(Note 1) Table 1	Creditor	Borrower	General ledger Is a related account party	Maximum outstanding balance during the year ended December 31,2020(Note 5)	Balance at December 31, 2020 (Note 6,7 and 8)	Actual amount drawn down (Note 2)	Interest rate	Nature of loan (Note 4)	Amount of transactions with the borrower	Reason for short-term financing	Allowance for doubtful accounts	Coll	ateral	Limit on loans granted to a single party (Note 3)	Ceiling on total loans granted(Note 3) 1,388,007 $ 1,388,007 1,388,007 1,388,007 Expressed in thousan (Except as otherwis
												Item	Value
0 0 0 0	Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD.	UNITED SKILLS CO., LTD. RISE BRIGHT HOLDINGS LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. LIAONING HETAI AUTOMOTIVE PARTS CO.,LTD	Other receivables Y Other receivables Y Other receivables Y Other receivables Y	77,000 $ 357,424 329,591 91,917	- $ 209,328 201,431 91,917	- $ 190,816 - 89,653	- 1.40% - 4.35%	2 2 2 2	- $ - - -	Operating capital Operating capital Operating capital Operating capital	- $ - - -	N N N N	- $ - - -	347,001 $ 347,001 347,001 347,001

• Note 1: The numbers filled in for the loans provided by the Company or subsidiaries are as follows:

• (1) The Company is ‘0’.

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

• Note 2: Balance at December 31, 2020 and actual amount drawn down were calculated at the USD and RMB buying and selling spot exchange rate of 28.48 and 4.37 on December 31, 2020.

• Note 3: Limit on total loans granted to others by the Company is 40% of the net assets and limit on loans granted to a single party is 10% of the net assets.

• Note 4: The nature of the loan are as follows:

• (1) Fill in ‘1’ for business transaction.

• (2) Fill in ‘2’ for short-term financing.

• Note 5: Loans granted to RISE BRIGHT HOLDINGS LTD. by Y.C.C whose maximum outstanding balance and balance at December 31, 2020 amounted to NT$357,424 exceed limit on loans granted to a single party. This is because the amount includes NT$166,608 that was used to repay loans which will be matured in June 2020 and February 2021. Limit on loans maintains NT$190,816 after repaying from other loans.

• Note 6: Loans granted to CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. approved by the Board of Directors amounted to US$5,000 thousand and RMB 30,500 thousand.

• Note 7: Loans granted to RISE BRIGHT approved by the Board of Directors amounted to US$7,350 thousand. Note 8: Loans granted to LIAONING HETAI AUTOMOTIVE PARTS CO., LTD approved by the Board of Directors amounted to RMB 21,000 thousand.

Table 1, Page 1

nds of NTD se indicated)

Footnote

Table 1, Page 2

Y.C.C. PARTS MFG. CO., LTD. and subsidiaries

Provision of endorsements and guarantees to others Year ended December 31, 2020

Table 2

Expressed in thousands of NTD (Except as otherwise indicated)

Number (Note 1)	Endorser/guarantor	Partybeingen	dorsed/guaranteed	Limit on endorsements/ guarantees provided for a single party (Note 3)	Maximum outstanding endorsement/ guarantee amount as of December 31,2020	Outstanding endorsement/ guarantee amount at December 31, 2020 (Note 4)	Actual amount drawn down (Note 4)	Amount of endorsements/ guarantees secured with collateral	Ratio of accumulated endorsement/ guarantee amount to net asset value of the endorser/guarantor company	Ceiling on total amount of endorsements/ provided (Note 3)	Provision of endorsements/guar antees by parent company to subsidiary	Provision of endorsements/guarantees by subsidiary to parent company	Provision of endorsements/guarantees to the party in Mainland China	Footnote
		Companyname	Relationship with the endorser/guarantor(Note 2)
0 0	Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD.	RISE BRIGHT HOLDINGS LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD.	2 3	694,003 $ 694,003 $	46,855 $ 372,708	12,460 $ 92,987	12,460 $ 92,987	- $ -	0.36% 2.68%	1,388,007 $ 1,388,007	Y Y	N N	N Y	Note 5 Note 6

Note 1: The numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows:

• (1)The Company is ‘0’.

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

• Note 2: Relationship between the endorser/guarantor and the Company is classified into the following three categories:

• (1) Having business relationship.

• (2) The endorser/guarantor parent company owns directly more than 50% voting shares of the endorsed/ guaranteed company.

• (3) The endorser/guarantor parent company and its subsidiaries jointly own more than 50% voting shares of the endorsed/ guaranteed company.

• Note 3: The Company’s limit on total endorsements/guarantees is 40% of net assets and limit on endorsements/guarantees provided for a single party is 20% of net assets.

• Note 4: Balance at December 31, 2020 and actual amount drawn down were calculated at the USD buying and selling spot exchange rate of 28.48 on December 31, 2020.

• Note 5: Endorsements and guarantees to RISE BRIGHT HOLDINGS LTD. approved by the Board of Directors amounted to US$500 thousand.

• Note 6: Endorsements and guarantees to CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. approved by the Board of Directors amounted to US$3,900 thousand.

Table 2, Page 1

Table 3

Expressed in thousands of NTD (Except as otherwise indicated)

Y.C.C. PARTS MFG. CO., LTD. and subsidiaries

Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures)

December 31, 2020

Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As of Decem	ber 31,2020		Footnote
				Number of shares	Book value	Ownership (%)	Fair value
Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD.	HIROCA HOLDINGS LTD. HIROCA HOLDINGS LTD. NUUO INC. DA-LI DEVELOPMENT CO., LTD.	N N N N	Non-current financial assets at fair value through other comprehensive income - non current Valuation adjustment Current financial assets at fair value through profit or loss - current Current financial assets at fair value through profit or loss - current Current financial assets at fair value through profit or loss - current Valuation adjustment	855,000 298,000 5,071 457	81,856 $ 29,615) (	1.02% 0.36% 0.04% 0.00%	52,241 $ 18,208 80 13
					52,241 $
					19,925 $ 277 11 1,912) (
							18,301 $
					18,301 $

Table 3, Page 1

Y.C.C. PARTS MFG. CO., LTD. and subsidiaries

Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more

December 31, 2020

Table 4

Expressed in thousands of NTD (Except as otherwise indicated)

Creditor	Counterparty	Relationship with the counterparty	Balance as at December 31, 2020 (Note 1)	Turnover rate (Note 4)	Overd	ue receivables	Amount collected subsequent to the balance sheet date (Note5)	Allowance for doubtful accounts	Footnote
					Amount	Action taken
Y.C.C. PARTS MFG. CO., LTD.	RISE BRIGHT HOLDINGS LTD.	Subsidiary	202,529 $	4.09%	- $	-	- $	- $	Notes 2

Note 1: The transactions were eliminated when preparing the consolidated financial statements.

Note 2: It pertains to principal and interest aggregating to $192,404 from loans to the subsidiary shown as other receivables and sales of equipment amounting to $2,023 thousand shown as other receivables and revenue from sales of processing machine amounting to $8,102 thoundsand shown as accounts receivables.

Note 3: Only accounts receivable was used for the calculation of turnover rate. Note 4: Subsequent collection is the amount collected as of March 10, 2021.

Table 4, Page 1

Table 5

Expressed in thousands of NTD

(Except as otherwise indicated)

Y.C.C. PARTS MFG. CO., LTD. and subsidiaries

Significant inter-company transactions during the reporting periods

Year ended December 31, 2020

Transaction

						Transaction
Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets (Note3)
0 0 0 0 0 0 1 1 1 1	Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. RISE BRIGHT HOLDINGS LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD.	RISE BRIGHT HOLDINGS LTD. RISE BRIGHT HOLDINGS LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. LIAONING HETAI AUTOMOTIVE PARTS CO., LTD LIAONING HETAI AUTOMOTIVE PARTS CO., LTD CHANG JIE TECHNOLOGY CO., LTD CHANGSHU XINXIANG AUTOMOBILE PARTS CO., LTD. LIAONING HETAI AUTOMOTIVE PARTS CO., LTD LIAONING HETAI AUTOMOTIVE PARTS CO., LTD	1 1 1 1 1 1 3 3 3 3	Other receivables Sales revenue Other receivables Other income Sales revenue Other receivables Sales revenue Other accrued expenses Accounts receivable Sales revenue	194,427 $ 47,216 13,670 11,347 10,105 96,869 27,071 13,686 36,824 33,540	Principal and interest are repayable at the maturity date 90 days after monthly billings Interest is repayable quarterly Interest is repayable quarterly 90 days after monthly billings Interest is repayable quarterly 90 days after monthly billings 30 days after monthly billings 60 days after monthly billings 60 days after monthly billings	3.67% 2.23% 0.26% 0.54% 0.48% 1.83% 1.28% 0.26% 0.70% 1.58%

Note 1: The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

(1) Parent company is ‘0’.

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

Note 2: Relationship between transaction company and counterparty is classified into the following three categories; fill in the number of category each case belongs to (If transactions between parent company and subsidiaries or between subsidiaries refer to the same transaction, and subsidiaries or between subsidiaries refer to it is not required to disclose twice. For example, if the parent company has already disclosed its transaction with a subsidiary, then the subsidiary is not required to disclose the transaction; for transactions between two subsidiaries, if one of the subsidiaries has disclosed the transaction, then the other is not required to disclose the transaction.):

(1) Parent company to subsidiary.

(2) Subsidiary to parent company.

(3) Subsidiary to subsidiary.

Note 3: Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and based on accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts.

Note 4: Transaction amount that did not reach $10 million or more will not be disclosed.

Note 5: The transactions were eliminated when preparing the consolidated financial statements.

Table 5, Page 1

Table 6

Y.C.C. PARTS MFG. CO., LTD. and subsidiaries

Information on investees

Year ended December 31, 2020

Expressed in tho

(Except as other

Investor	Investee	Location	Main business activities	Initial invest	ment amount	Shares hel	d as at December	31,2020	Net profit (loss) of the investee for the year ended December 31,2020	Investment income (loss) recognised by the Company for year ended December 31,2020
				Balance as at December 31,2020	Balance as at December 31,2019	Number of shares	Ownership (%)	Book value
Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD. RISE BRIGHT HOLDINGS LTD.	UNITED SKILLS CO., LTD. RISE BRIGHT HOLDINGS LTD. CHINA FIRST HOLDINGS LTD.	Taiwan Samoa Samoa	Manufacturing vehicles and their parts Holding company Holding company	50,000 $ 1,077,179 1,158,673	50,000 $ 1,019,819 1,158,673	5,000 - -	100.00% 100.00% 89.44%	50,279 $ 534,765 594,359	605) ($ 90,475) ( 4,955) (	605) ($ 90,475) ( 4,432) (

Note: The company does not hold any share in the investee because the investee is a limited company.

Table 6, Page 1

ousands of NTD

rwise indicated)

Footnote

Subsidiary

Subsidiary (Note) Subsidiary (Note)

Table 6, Page 2

Information on investments in Mainland China

Table 7

Expressed in thousands of NTD (Except as otherwise indicated)

Y.C.C. PARTS MFG. CO., LTD. and subsidiaries

Year ended December 31, 2020

Investee in Mainland China	Main business activities	Paid-in capital	Investment method (Note 1)	Accumulated amount of remittance from Taiwan to Mainland China as of January1,2020	Amount remitted Mainland China/ back to Taiwan f December	from Taiwan to Amount remitted or the year ended 31,2020	Accumulated amount of remittance from Taiwan of Mainland China as of December 31,2020	Net income of December 31, 2020	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the year ended December 31,2020(Note 2)	Book value of investments in Mainland China as of December 31,2020	Accumulated amount of investment income remitted back to Taiwan as of December 31,2020 Footnte
					Remitted to Mainland China	Remitted back to Taiwan
CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. LIAONING HETAI AUTOMOTIVE PARTS CO., LTD. CHANGSHU XINXIANG AUTOMOBILE PARTS CO., LTD. CHANG JIE TECHNOLOGY CO., LTD.	Injecting and surface coating air bag covers of automobiles,producing and selling various accessories of automobiles and electronic plastic parts Injecting and surface coating parts of air bags with inflation system,covers, interior and exterior accessories of air bag and electronic equipment systems Manufacturing and selling parts, interior and exterior accessories and electronic system parts of automobiles and molds, gauges, clamps and jigs for injection Injecting and surface coating air bag covers of automobiles,producing and selling various accessories of automobiles and automatic production equipments for spraying	423,150 $ 347,588 60,450 133,225	2 2 2 2	827,609 $ 268,009 63,055 77,061	- - - 57,360	- - - -	827,609 $ 268,009 63,055 134,421	19,587) ($ 14,240 1,103) ( 4,342) (	89.44% 73.89% 89.44% 99.78%	17,519) ($ 10,521 987) ( 4,324) (	332,282 $ 191,947 51,528 130,923	- $ Note 5 Note 7 - Note 6 - Note 4 - Note 3

• Note 1: Investment methods are classified into the following three categories; fill in the number of category each case belongs to:

• (1) Directly invest in a company in Mainland China.

• (2) Through investing in existing companies in the third area, RISE BRIGHT HOLDINGS LTD. and CHINA FIRST HOLDINGS LTD. , which then invested in the investee in Mainland China.

• Note 2: The amounts listed in the table denominated in foreign currencies are translated into New Taiwan dollars at the exchange rates at the balance sheet date. Note 3: Paid-in capital is US$4,510 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$4,500 thousand. Note 4: Paid-in capital is US$2,000 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$2,000 thousand. Note 5: Paid-in capital is US$14,000 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$26,300 thousand. Note 6: Paid-in capital is US$11,500 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$8,591 thousand. Note 7: ‘Investment income (loss) recognised by the Company for the nine months ended December 31, 2020 was based on the financial statements that were reviewed by parent company’s CPA.

Ceiling on investments Investment amount approved by in Mainland China Accumulated amount of remittance from the Investment Commission of imposed by the Taiwan to Mainland China as of the Ministry of Economic Affairs Investment Company name December 31, 2020 (MOEA) Commission of MOEA Y.C.C. PARTS MFG. CO., $ 1,293,094 $ 1,315,224 $ 2,082,010 LTD.

Note 1: The amounts listed in the table denominated in foreign currencies are translated into New Taiwan dollars at the exchange rates at the balance sheet date.

Note 2: Calculation for ceiling on investments in Mainland China (60% of net assets) is based on MOEA “Regulations Governing the Permission of Investment or Technical Cooperation in Mainland Area”.

Note 3: At the end of this period, the investment amount transmitted from Taiwan to mainland China was US$40,098 thousand. The investment amount permitted by the Investment Commission of Ministry of Economic Affairs(MOEA) was US$42,098 thousand.

Table 7, Page 1

Table 8

Y.C.C. PARTS MFG. CO., LTD. and subsidiaries

Major shareholders information

December 31, 2020

Name of major shareholders	Sh	ares
	Number of shares held	Ownership (%)
HAO QUN INVESTMENT & DEVELOPMENT CO.,LTD SONG QUN INVESTMENT & DEVELOPMENT CO.,LTD HE HAN INVESTMENT CO.,LTD RU HAN INVESTMENT CO.,LTD HUANG KAI INVESTMENT CO.,LTD	11,791,000 10,731,000 7,586,503 5,964,420 5,791,500	15.90% 14.47% 10.23% 8.04% 7.81%

Description: If the company applies Taiwan Depository & Clearing Corporation for the information of the table, the followings can be explained in the notes of the table.

(1) The major shareholders information was from the data that the Company issued common shares (including treasury shares) and preference shares in dematerialised form which were registered and held by the shareholders above 5% on the last operating date of each quarter and was calculated by the Taiwan Depository & Clearing Corporation.

The share capital which was recorded on the financial statements may be different from the actual number of shares in dematerialised form because of a different calculation basis.

(2) If the aforementioned data contains shares which were kept in trust by the shareholders, the data that was disclosed was the settlor's separate account for the fund set by the trustee.

As for the shareholder who reports share equity as an insider whose shareholding ratio is greater than 10% in accordance with Securities and Exchange Act, the shareholding ratio includes the self-owned shares and trusted shares, at the same time, persons who have power to decide how to allocate the trust assets. For the information of reported share equity of insider, please refer to the Market Observation Post System.

Table 8, Page 1