Y.C.C. — Audit Report / Information 2022

Nov 14, 2022

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

CONSOLIDATED FINANCIAL STATEMENTS AND

INDEPENDENT AUDITORS’ REPORT

DECEMBER 31, 2022 AND 2021

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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, 2022, 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 13, 2023

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INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of Y.C.C. Parts Mfg. Co., Ltd.

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, 2022 and 2021, 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, 2022 and 2021, 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 that came into effect 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 Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Group’s 2022 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 2022 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(18). The Group is primarily engaged in manufacturing and trading automobile 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. Examined the transaction documents to ensure that transactions had been recorded in the proper period for a certain period around the balance sheet date.

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(5). The Group is primarily engaged in manufacturing and trading automobile parts. Sale revenue is recognised when the control over the goods was transferred under the transaction terms.

As of December 31, 2022, the balances of inventories and allowance for inventory valuation losses were NT$ 385,108 thousand and NT$ 84,916 thousand, respectively.

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The Group is primarily engaged in manufacturing and trading automobile 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 – Parent company only financial reports

We have audited and expressed an unqualified opinion on the parent company only financial statements of Y.C.C. Parts Mfg. Co., Ltd. as at and for the years ended December 31, 2022 and 2021.

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

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

1. Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk

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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.

1. 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.

2. 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.

1. 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 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.

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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 13, 2023

------------------------------------------------------------------------------------------------------------------------------------------------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, 2022 AND 2021

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(2) 6(3) 6(4) 6(4) 6(5) 8 6(6) 6(3) and 8 6(7) and 8 6(8) and 8 8 6(25) 6(9)	December 31, 2022 AMOUNT % $ 1,036,374 19 129,623 2 - - 27,081 1 534,281 10 10,366 - 300,192 5 43,097 1 2,081,014 38 75,247 1 300 - 2,974,815 54 140,906 3 14,713 - 5,016 - 107,967 2 137,492 2 3,456,456 62 $ 5,537,470 100	December 31, 2021	December 31, 2021
		AMOUNT $ 1,036,374 129,623 - 27,081 534,281 10,366 300,192 43,097 2,081,014 75,247 300 2,974,815 140,906 14,713 5,016 107,967 137,492 3,456,456 $ 5,537,470	AMOUNT $ 635,392 117,251 199,416 55,055 441,993 10,792 313,690 52,099 1,825,688 48,308 300 2,830,766 140,137 15,477 11,147 108,171 71,871 3,226,177 $ 5,051,865	%
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1136 Current financial assets at amortised cost 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 Non-current financial assets at fair value through other comprehensive income 1535 Non-current financial assets at amortised cost 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 2 4 1 9 - 6 1
				36
				1 - 56 3 - - 2 2
				64
				100

(Continued)

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Y.C.C. PARTS MFG. CO. LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2022 AND 2021

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity

December 31, 2022 December 31, 2021 Notes AMOUNT % AMOUNT % 6(10) $ 261,721 5 $ 264,320 5 6(11) - - 50,000 1 6(2) - - 12,111 - 6(19) 14,852 - 17,912 - 179,968 3 92,502 2 141,453 2 157,602 3 6(12) 197,101 4 145,514 3 6(25) 143,864 3 68,729 2 6(13) 169,662 3 105,835 2 6(8) 2,655 - 1,703 - 1,111,276 20 916,228 18 6(13) 566,370 10 540,190 11 6(25) 28,511 1 31,538 1 6(25) 513 - - - 6(8)(14) 15,251 - 13,651 - 610,645 11 585,379 12 1,721,921 31 1,501,607 30 6(16) 741,239 13 741,389 15 6(17) 1,193,349 22 1,193,349 24 6(18) 343,211 6 329,574 6 120,040 2 105,211 2 1,425,612 26 1,194,447 24 ( 109,142) ( 2) ( 120,040) ( 3 ) 6(16) - - ( 526) - 3,714,309 67 3,443,404 68 101,240 2 106,854 2 3,815,549 69 3,550,258 70 9 $ 5,537,470 100 $ 5,051,865 100

Current liabilities 2100 Short-term borrowings 2110 Short-term notes and bills payable 2120 Financial liabilities at fair value through profit or loss - current 2130 Current contract liabilities 2150 Notes payable 2170 Accounts payable 2200 Other payables 2230 Current income tax liabilities 2320 Long-term liabilities, current portion 2399 Other current liabilities, others 21XX Total current Liabilities Non-current liabilities 2540 Long-term borrowings 2560 Current tax liabilities-non current 2570 Deferred income tax liabilities 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 events after the balance sheet date 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, 2022 AND 2021

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

Items

Year ended December 31 2022 2021 Notes AMOUNT % AMOUNT % 4(19) $ 2,020,758 100 $ 1,918,100 100 6(5)(23)(24) ( 1,490,296) ( 74) ( 1,472,524) ( 77) 530,462 26 445,576 23 6(23)(24) ( 126,108) ( 6) ( 113,494) ( 6) ( 136,240) ( 7) ( 115,548) ( 6) ( 70,601) ( 3) ( 37,564) ( 2) 12(2) ( 17,511) ( 1) ( 4,481) - ( 350,460) ( 17) ( 271,087) ( 14) 180,002 9 174,489 9 18,751 1 2,584 - 6(20) 33,458 1 21,917 1 6(21) 321,339 16 ( 10,009) - 6(22) ( 26,327) ( 1) ( 18,575) ( 1) 347,221 17 ( 4,083) - 527,223 26 170,406 9 6(25) ( 126,230) ( 6) ( 42,707) ( 2) $ 400,993 20 $ 127,699 7

4000 Sales revenue 5000 Operating costs 5900 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 Impairment loss (impairment gain and reversal of impairment loss) determined in accordance with IFRS 9 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, 2022 AND 2021

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

Items

Year ended December 31 2022 2021 Notes AMOUNT % AMOUNT % 6(15) ($ 381) - $ 776 - 6(6) 7,008 - ( 3,933) - 76 - ( 155) - 6,703 - ( 3,312) - 5,843 - ( 11,542) ( 1) 5,843 - ( 11,542) ( 1) $ 12,546 - ($ 14,854) ( 1) $ 413,539 20 $ 112,845 6 $ 408,560 20 $ 135,753 7 ( 7,567) - ( 8,054) - $ 400,993 20 $ 127,699 7 $ 419,153 20 $ 121,545 6 ( 5,614) - ( 8,700) - $ 413,539 20 $ 112,845 6 6(26) $ 5.51 $ 1.83 $ 5.50 $ 1.83

Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 8311 Other comprehensive income, before tax, actuarial gains (losses) on defined benefit plans 8316 Total expenses, by nature 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8310 Components of other comprehensive income (loss) that will not be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8361 Financial statements translation differences of foreign operations 8360 Components of other comprehensive income 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, 2022 AND 2021

(Expressed in thousands of New Taiwan dollars)

Year 2021 Balance at January 1, 2021 Profit (loss) for the year Other comprehensive income (loss) Total comprehensive income Appropriation and distribution of 2020 earnings Legal reserve Special reserve Cash dividends Acquisition of non-controlling interests in subsidiaries Balance at December 31, 2021 Year 2022 Balance at January 1, 2022 Profit (loss) for the year Other comprehensive income (loss) Total comprehensive income (loss) Appropriation and distribution of 2021 earnings Legal reserve Special reserve Cash dividends Retirement of treasury shares Balance at December 31, 2022	Notes						Equity attributable to owners of the parent	Equity attributable to owners of the parent	Equity attributable to owners of the parent	Equity attributable to owners of the parent	Equity attributable to owners of the parent				Non-controlling interests		Total equity
			Share capital - common stock	Capital surplus, additional paid- in capital			Retained Earnings			Other equity interest		Treasury shares		Total
							Legal reserve	Special reserve	Unappropriated retained earnings	Financial statements translation differences of foreign operations	Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income
	6(6) 6(18) 6(6) 6(18) 6(16)	$ 741,389 - - - - - - - $ 741,389 $ 741,389 - - - - - - ( 150 ) $ 741,239			$ 1,193,259 - - - - - - 90 $ 1,193,349 $ 1,193,349 - - - - - - - $ 1,193,349		$ 317,795 - - - 11,779 - - - $ 329,574 $ 329,574 - - - 13,637 - - - $ 343,211	$ 119,480 - - - - ( 14,269 ) - - $ 105,211 $ 105,211 - - - - 14,829 - - $ 120,040	$ 1,203,831 135,753 621 136,374 ( 11,779 ) 14,269 ( 148,248 ) - $ 1,194,447 $ 1,194,447 408,560 ( 305 ) 408,255 ( 13,637 ) ( 14,829 ) ( 148,248 ) ( 376 ) $ 1,425,612	($ 75,596 ) - ( 10,896 ) ( 10,896 ) - - - - ($ 86,492 ) ($ 86,492 ) - 3,890 3,890 - - - - ($ 82,602 )	($ 29,615 ) - ( 3,933 ) ( 3,933 ) - - - - ($ 33,548 ) ($ 33,548 ) - 7,008 7,008 - - - - ($ 26,540 )	($ 526 ) - - - - - - - ($ 526 ) ($ 526 ) - - - - - - 526 $ -	$ 3,470,017 135,753 ( 14,208 ) 121,545 - - ( 148,248 ) 90 $ 3,443,404 $ 3,443,404 408,560 10,593 419,153 - - ( 148,248 ) - $ 3,714,309		$ 115,644 ( 8,054 ) ( 646 ) ( 8,700 ) - - - ( 90 ) $ 106,854 $ 106,854 ( 7,567 ) 1,953 ( 5,614 ) - - - - $ 101,240	$ 3,585,661 127,699 ( 14,854 ) 112,845 - - ( 148,248 ) - $ 3,550,258 $ 3,550,258 400,993 12,546 413,539 - - ( 148,248 ) - $ 3,815,549

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, 2022 AND 2021

(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 gain on financial assets or liabilities at fair value through profit or loss Interest expense Interest income Government grant revenues Dividend income Proceeds from disposal of property, plant and equipment Changes in operating assets and liabilities Changes in operating assets Notes receivable, net Accounts receivable, net Other receivables Inventories Other 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 2022 2021 $ 527,223 $ 170,406 6(23) 362,608 334,048 6(23) 6,383 5,698 6(23) 7,087 7,483 12(2) 17,511 4,481 6(2)(21) ( 39,275 ) ( 47,204 ) 6(22) 26,327 18,575 ( 18,751 ) ( 2,584 ) 6(14) ( 1,099 ) ( 966 ) 6(20) ( 4,958 ) ( 4,111 ) 6(21) ( 3,798 ) ( 4,528 ) 27,974 ( 25,502 ) ( 109,799 ) 145,184 2,445 ( 7,515 ) 13,498 ( 10,936 ) 7,000 9,589 ( 3,060 ) ( 2,265 ) ( 15,488 ) ( 25,990 ) ( 16,149 ) ( 93,501 ) ( 1,620 ) ( 3,985 ) ( 677 ) 190 409 ( 209 ) 783,791 466,358 16,732 2,886 ( 26,212 ) ( 18,678 ) 4,958 4,111 ( 31,677 ) ( 25,903 ) 747,592 428,774

(Continued)

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Y.C.C. PARTS MFG. CO. LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2022 AND 2021

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of financial assets at fair value through profit or loss Decrease in financial assets at amortised cost Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipmentt Payment for capitalized interest Acquisition of intangible assets Decrease in other financial assets Increase in other non-current assets Increase in refundable deposits Proceeds from disposal of financial assets at fair value through profit or loss Net cash flows used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term borrowings Decrease in short-term borrowings Decrease in short-term notes and bills payable Proceeds from long-term borrowings Repayments of long-term borrowings Increase in refundable deposits Repayments of principal portion of lease liabilities Cash dividends paid Net cash flows used in financing activities Effect of exchange rate changes on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

Year ended December 31 Notes 2022 2021 6(27) ($ 102,240 ) ($ 121,127 ) 199,416 65,268 6(27) ( 365,716 ) ( 306,802 ) 5,040 7,667 6(7) ( 1,193 ) ( 1,972 ) ( 937 ) ( 6,868 ) 2,002 24,738 ( 34,707 ) 973 ( 1,797 ) ( 17 ) 95,485 57,760 ( 204,647 ) ( 280,380 ) 6(28) 289,015 987,609 6(28) ( 298,582 ) ( 1,054,832 ) 6(28) ( 50,000 ) 50,000 6(28) 192,540 75,860 6(28) ( 105,835 ) ( 143,101 ) 6(28) 132 - 6(28) ( 2,668 ) ( 594 ) 6(28) ( 148,248 ) ( 148,248 ) ( 123,646 ) ( 233,306 ) ( 18,317 ) ( 22,106 ) 400,982 ( 107,018 ) 635,392 742,410 $ 1,036,374 $ 635,392

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, 2022 AND 2021

(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 automobile 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 authorised for issuance by the Board of Directors on March 13, 2023.

3. Application of New Standards, Amendments and Interpretations

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

New standards, interpretations and amendments endorsed by the FSC and became effective from 2022 are as follows:

2022 are as follows:
New Standards,Interpretations and Amendments	Effective date by International Accounting Standards Board
Amendments to IFRS 3, ‘Reference to the conceptual framework’ Amendments to IAS 16, ‘Property, plant and equipment: proceeds before intended use’ Amendments to IAS 37, ‘Onerous contracts - cost of fulfilling a contract’ Annual improvements to IFRS Standards 2018-2020	January 1, 2022 January 1, 2022 January 1, 2022 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.

(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 2023 are as follows:

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	International Accounting
New Standards,Interpretations andAmendments	StandardsBoard
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 12, ‘Deferred tax related to assets and liabilities arising from a single transaction’	January 1, 2023

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:

	Effective date by
	International Accounting
New Standards,Interpretations andAmendments	StandardsBoard
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets between an investor and its associate or joint venture’	To be determined by International Accounting Standard Board
Amendments to IFRS 16, ‘Lease liability in a sale and leaseback’	January 1, 2024
IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendment to IFRS 17, ‘Initial application of IFRS 17 and IFRS 9 – comparative information’	January 1, 2023
Amendments to IAS 1, ‘Classification of liabilities as current or non-current’	January 1, 2024
Amendments to IAS 1, ‘Non-current liabilities with covenants’	January 1, 2024

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 Interpretations that came into effect as endorsed by the FSC (collectively referred herein as the “IFRSs”).

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(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 IFRSs 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.

~18~

• (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 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, 2022 December 31, 2021 100.00% 100.00% 100.00% 100.00% 89.44% 89.44% 99.83% 99.83% 100.00% 100.00% 82.61% 82.61% 100.00% 100.00% Ownership(%)	Description Note Note
				December 31, 2022
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 LIAONING HETAI AUTOMOTIVE PARTS CO.,LTD. (LIAONING HETAI) CHANGSHU XINXIANG AUTOMOBILE PARTS CO., LTD. (CHANGSHU XINXIANG)	Holding company and selling interior and exterior accessories of automobiles Manufacturing automobiles and their parts Holding company 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 Producing and selling interior and exterior accessories of automobiles		100.00% 100.00% 89.44% 99.83% 100.00% 82.61% 100.00%

Note : The Board of Directors resolved to increase its capital in the subsidiary, Rise Bright Holdings Ltd., in the amount of US$5,300 thousand (NT$158,179 thousand) on November 12, 2021, and then reinvested in Chang Jie Technology Co., Ltd.. The capital was remitted in December 2021. Due to the original shareholders of Chang Jie Technology Co., Ltd. not subscribing proportionately, Rise Bright Holdings Ltd.’s shareholding ratio increased to 99.83%.

• C. Subsidiaries not included in the consolidated financial statements

None.

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• 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 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.

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  - (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;

  • (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.

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• 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.

• (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.

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(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, 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.

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• 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 5 ~ 10 years 2 ~ 5 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.

• 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.

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(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, People's Republic of 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.

• 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.

~25~

(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 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.

~26~

• (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 the year the stockholders resolve to retain the earnings.

~27~

• 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.

~28~

• 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 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 120 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.

~29~

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

• 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, 2022, the carrying amount of inventories was $300,192.

~30~

6. Details of Significant Accounts

(1) Cash and cash equivalents

tails of Significant Accounts Cash and cash equivalents
Cash on hand Time deposits Checking accounts and demand deposits Short-term notes and bills - Re-Purchase Interest rate range Time deposits	December31,2022 331 $ 126,158 755,859 154,026 1,036,374 $ 0.85%~4.35%	December31,2021 356 $ 129,327 477,775 27,934 635,392 $
		0.07%~0.41%

• 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(3) for details.

• C. Information about the financial assets at amortised cost that were pledged to others as collaterals is provided in Notes 6(3) and 8.

(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 assets (liabilities) held for trading Foreign exchange swap contracts Total financial assets at fair value through profit or loss Total financial liabilities at fair value through profit or loss	December31,2022 December31,2021 108,476 $ 103,910 $ 18,582 13,341 127,058 $ 117,251 $ 2,565 $ 12,111) ($ 129,623 $ 117,251 $ - $ 12,111) ($	December31,2021
		103,910 $ 13,341
		117,251 $

• A. The Group recognised financial assets and liabilities at fair value through profit or loss of $39,275 and $47,204 for the years ended December 31, 2022 and 2021, 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	December31,2022	December31,2022
	Contract amount (Notionalprincipal)	Contractperiod
	USD 26,100 thousand	2022.12.05 ~ 2023.01.30

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	December	31,2021
Derivative financial assets (liabilities)	Contract amount
	(Notionalprincipal)	Contract period
Foreign exchange swap contracts	USD 78,240 thousand	2021.09.03 ~ 2022.06.06

• 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 at fair value through profit or loss is provided in Note 12(2).

(3) Financial assets at amortised cost

==> picture [481 x 141] intentionally omitted <==

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

Items December 31, 2022 December 31, 2021
Current items:
Time deposits maturing over
three months $ - $ 18,967
USD bonds sold under repurchase
- 180,449
agreement
$ - $ 199,416
Non-current items
Restricted time deposits $ 300 $ 300
----- End of picture text -----

• A. As at December 31, 2022 and 2021, 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 $300 and $199,716, respectively.

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

• C. Information relating to credit risk of financial assets at amortised cost is provided in Note 12(2). The counterparties of the Group’s investments in certificates of deposit are financial institutions with high credit quality, so the Group expects that the probability of counterparty default is remote.

(4) Notes and accounts receivable, net

Notes and accounts receivable, net
			December31,2022			December31,2021
Notes receivable		$	27,225		$	55,217
Less: Allowance for uncollectible
accounts	(		144)	(		162)
		$	27,081		$	55,055
			December31,2022			December31,2021
Accounts receivable		$	598,967		$	489,954
Less: Allowance for uncollectible
accounts	(		64,686)	(		47,961)
		$	534,281		$	441,993

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

Not past due 1~60 days 61~120 days 121~180 days 181-240 days Over 241 days Not past due 1~60 days 61~120 days 121~180 days 181-240 days Over 241 days	December	31,2022
	Notesreceivable 27,225 $ - - - - - 27,225 $ December	Accountsreceivable
		481,130 $ 52,368 10,909 4,968 3,226 46,366
		598,967 $
		31,2021
	Notesreceivable 55,217 $ - - - - - 55,217 $	Accountsreceivable
		424,119 $ 45,462 4,590 2,750 324 12,709
		489,954 $

As of December 31, 2022 and 2021, the ageing analysis was based on past due date.

• B. As of December 31, 2022 and 2021, the balances of accounts receivable and notes receivable were all from contracts with customers. As of January 1, 2021, the balances of accounts receivable and notes receivable from contracts with customers amounted to $635,490 and $29,632, respectively.

• C. As at December 31, 2022 and 2021, 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 $27,081and $55,055 as well as $534,281 and $441,993, respectively.

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

~33~

(5) Inventories

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		December31,2022
	Cost 107,144 $ 50,090 11,167 204,095 12,612 385,108 $	Allowance for valuation loss 33,281) ($ 4,319) ( 2,400) ( 42,981) ( 1,935) ( 84,916) ($ December31,2021	Bookvalue
			73,863 $ 45,771 8,767 161,114 10,677
			300,192 $
	Cost 98,198 $ 40,802 16,621 220,493 7,799 383,913 $		Bookvalue
			68,036 $ 37,610 11,034 189,211 7,799
			313,690 $

The cost of inventories recognised as expense for the period :

			YearendedDecember	YearendedDecember	YearendedDecember	31,
			2022			2021
Cost of goods sold		$	1,472,571		$	1,470,893
Unallocated fixed overheads			325			520
Loss on scrapping inventory			5,983			1,669
Loss on market value decline and obsolete and slow-moving inventories			13,872			286
Gain on physical inventory	(		2,455)	(		844)
		$	1,490,296		$	1,472,524

(6) Non-current financial assets at fair value through other comprehensive income

Items			December31,2022			December31,2021
Non-current items:
Equity instruments
Listed stocks		$	101,787		$	81,856
Valuation adjustment	(		26,540)	(		33,548)
		$	75,247		$	48,308

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• 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 $75,247 and $48,308 as at December 31, 2022 and 2021, respectively.

• B. 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:

==> picture [471 x 121] intentionally omitted <==

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

Year ended December 31,
2022 2021
Equity instruments at fair value through
other comprehensive income
Fair value change recognised in other
comprehensive income $ 7,008 ($ 3,933)
Dividend income recognised in profit or
-
loss held at end of period $ $ 2,993
----- End of picture text -----

• C. As at December 31, 2022 and 2021, 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 $75,247 and $48,308, respectively.

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

(Remainder of page intentionally left blank)

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(7) Property, plant and equipment

Property, plant and equipment
									Yearended		December31,		2022
		Beginning balance				Additions		Decreases				Transfers	Net exchange		differences			Ending balance
Cost
Land		$	956,365		$	-		$	-		$	-		$	-		$	956,365
Buildings and structures			1,551,839			7,136	(		6,343)			59,079			6,036			1,617,747
Machinery and equipment			1,247,878			93,130	(		45,400)			43,475			6,773			1,345,856
Molding equipment			1,950,026			153,167	(		12,639)			45,554			659			2,136,767
Transportation equipment			32,421			6,051	(		3,220)			-			29			35,281
Furniture equipment			3,153			373	(		57)			-			16			3,485
Other equipment			181,171			8,436	(		9,065)			7,637			1,104			189,283
Unfinished construction and
equipment under acceptance			255,075			153,559			-	(		81,699)			1,422			328,357
		$	6,177,928		$	421,852	($		76,724)		$	74,046		$	16,039		$	6,613,141
Accumulated Depreciation
Buildings and structures	($		831,855)	($		69,602)		$	6,343		$	-	($		1,872)	($		896,986)
Machinery and equipment	(		803,344)	(		99,635)			44,877			-	(		2,452)	(		860,554)
Molding equipment	(		1,547,657)	(		170,953)			12,639			-	(		264)	(		1,706,235)
Transportation equipment	(		27,784)	(		2,282)			3,220			-	(		18)	(		26,864)
Furniture equipment	(		2,564)	(		309)			57			-	(		9)	(		2,825)
Other equipment	(		133,958)	(		18,711)			8,346			-	(		539)	(		144,862)
	(		3,347,162)	($		361,492)		$	75,482		$	-	($		5,154)	(		3,638,326)
Total		$	2,830,766														$	2,974,815

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								Yearended	December31,	December31,	2021	2021	2021
		Beginning balance			Additions			Decreases		Transfers		Net exchange differences					Ending balance
Cost
Land		$	956,365	$	-		$	-	$		-		$	-		$	956,365
Buildings and structures			1,548,691		9,153	(		5,018)		1,196		(		2,183)			1,551,839
Machinery and equipment			1,207,914		50,718	(		75,157)		66,316		(		1,913)			1,247,878
Molding equipment			1,678,794		204,190	(		956)		68,134		(		136)			1,950,026
Transportation equipment			32,456		-	(		24)			-	(		11)			32,421
Furniture equipment			3,195		104	(		140)			-	(		6)			3,153
Other equipment			181,056		6,747	(		7,541)		1,662		(		753)			181,171
Unfinished construction and
equipment under acceptance			259,837		69,554			-	(	73,756)		(		560)			255,075
		$	5,868,308	$	340,466	($		88,836)	$	63,552		($		5,562)		$	6,177,928
Accumulated Depreciation
Buildings and structures	($		767,777)	($	69,487)		$	5,019	$		-		$	390	($		831,855)
Machinery and equipment	(		779,366)	(	96,946)			72,062			-			906	(		803,344)
Molding equipment	(		1,402,903)	(	145,766)			956			-			56	(		1,547,657)
Transportation equipment	(		25,534)	(	2,280)			25			-			5	(		27,784)
Furniture equipment	(		2,449)	(	259)			140			-			4	(		2,564)
Other equipment	(		123,178)	(	18,379)			7,495			-			104	(		133,958)
	(		3,101,207)	($	333,117)		$	85,697	$		-		$	1,465	(		3,347,162)
		$	2,767,101													$	2,830,766

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

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

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• C. 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:

the interest rates for such capitalisation are as follows:
December31,2022 Amount capitalised 1,193 $ Range of the interest rates for capitalisation 0.95%	December31,2021
	1,972 $ 0.81%

• (8) Lease transactions – lessee

• A. The Group leases various assets including land, structures and transportation equipment. Rental contracts are typically made for periods of 1 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. Short-term leases with a lease term of 12 months or less comprise certain buildings. Low-value assets comprise transportation equipment.

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

Land Transportation equipment (Business vehicles) Land Transportation equipment (Business vehicles)	December 31, 2022 December31,2021 Carrying amount Carrying amount 134,276 $ 136,195 $ 6,630 3,942 140,906 $ 140,137 $ YearendedDecember31,	December31,2021
		Carrying amount
		136,195 $ 3,942
		140,137 $
	2022 Depreciation charge 4,115 $ 2,268 6,383 $	2021
		Depreciation charge
		4,051 $ 1,647
		5,698 $

• D. For the year ended December 31, 2022, the additions to right-of-use assets were $4,956. For the year ended December 31, 2021, there were no additions to right-of-use assets.

~38~

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

==> picture [470 x 97] intentionally omitted <==

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

Year ended December 31,
2022 2021
Items affecting profit or loss
Interest expense on lease liabilities $ 98 $ 28
Expense on short-term lease contracts $ 622 $ 827
Expense on leases of low-value assets $ 760 $ 567
----- End of picture text -----

• F. As of December 31, 2022 and 2021, the balances of lease liabilities -current and lease liabilities

• non-current are as follows (shown as other current liabilities - others and other non-current liabilities):

Lease liabilities - current Lease liabilities - non-current	December 31, 2022 December 31, 2021 2,228 $ 601 $ 4,465 $ 1,736 $

• For the years ended December 31, 2022 and 2021, the Group’s total cash outflow for leases were $4,149 and $2,016 respectively.

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

(9) Other non-current assets

Note 8. Other non-current assets
)Short-term borrowings Prepayments for business facilities and construction Guarantee deposits paid Others Type of borrowings Unsecured borrowings Secured borrowings Interest rate range	December 31, 2022 129,261 $ 4,092 4,139 137,492 $ December31,2022 - $ 261,721 261,721 $ 4.35%	December31,2021
		65,368 $ 2,295 4,208
		71,871 $
		December31,2021
		41,525 $ 222,795
		264,320 $
		1.99%~4.35%

(10) Short-term borrowings

~39~

(11) Short-term notes and bills payable

(12)	Other payable Notes payable Interest rate range Machinery and equipment payable Salaries and bonus payable Employees’ compensation payable Transportation fee payable Directors’ remuneration payable Securities expense payable Others	December31,2022 December31,2021 - $ 50,000 $ - 0.86% December31,2022 December31,2021 65,309 $ 48,234 $ 45,061 33,865 7,360 6,529 7,011 6,260 5,661 4,017 1,383 3,573 65,316 43,036 197,101 $ 145,514 $

(Remainder of page intentionally left blank)

~40~

- (13) Long term borrowings

g-term borrowings
Type ofborrowings	Borrowing period	Repayment term	December31,2022
Long-term bank
borrowings
Unsecured borrowings	From November 26,	The loan is fully disbursed	$	13,833
	2018 to November	once the contract is signed;
	26, 2023	interest is repayable monthly;
		principal is repayable monthly
		in 48 installments with 1-year
		grace period on principal only
Unsecured borrowings	From August 31,	Starting from August 15,		6,662
	2016 to February 15,	2019, principal is repayable
	2023	quarterly; interest is repayable
		monthly
Unsecured borrowings	From December 26,	The loan is disbursed within		48,000
	2019 to December	three years after contract is
	26, 2026	signed; interest is repayable
		monthly; 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		235,764
	2016 to January 6,	repayable monthly after a 3-
	2031	year grace period
Secured borrowings	From December 26,	Principal and interest are		368,000
	2019 to December	repayable monthly after a 3-
	26, 2026	year grace period;interest is
		repayable monthly;principal is
		repayable monthly in 48
		installments
Secured borrowings	From December 26,	The loan is disbursed within
	2019 to September	three years after contract
	16, 2029	signed; interest is repayable
		monthly; principal is repayable
		monthly in 51 installments
		with a 3-year grace period on
		principal only		64,000
			$	736,259
Less: Current portion			(	169,662)
Less: Discount on
government grants			(	227)
			$	566,370
Interest rate range				1.13%~1.66%

~41~

Type of borrowings	Borrowing period	Repayment term	December31,2021	December31,2021
Long-term bank
borrowings
Unsecured borrowings	From November	The loan is fully disbursed	$	63,833
	26, 2018 to	once the contract is signed;
	November 26,	interest is repayable
	2023	monthly; principal is
		repayable monthly in 48
		installments with 1-year
		grace period on principal
		only
Unsecured borrowings	From August 31,	Starting from August 15,		33,330
	2016 to February	2019, principal is repayable
	15, 2023	quarterly; interest is
		repayable monthly
Unsecured borrowings	From December	The loan is disbursed within		18,300
	26, 2019 to	three years after contract is
	December 26,	signed; interest is repayable
	2026	monthly; 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		264,931
	2016 to January 6,	repayable monthly after a 3-
	2031	year grace period
Secured borrowings	From December	The loan is disbursed within
	26, 2019 to	three years after contract
	December 16,	signed; interest is repayable
	2028	monthly; principal is
		repayable monthly in 48
		installments with a 3-year
		grace period on principal
		only		269,160
			$	649,554
Less: Current portion			(	105,835)
Less: Discount on
government grants			(	3,529)
			$	540,190
Interest rate range				0.75%~1.00%

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(14) Government grants

As of December 31, 2022, 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 $432,000 and $48,000, respectively, for supporting capital expenditure and working capital. Such loans will mature in December 2029 and December 2026, respectively. The fair values for the loans were $424,231 and $47,217, respectively which were calculated at a market rate of 1.25%. The differences between the acquired amount obtained and the fair value were $7,769 and $723, 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. The realised deferred government grants revenue were $1,099 and $966, respectively, for the years ended December 31, 2022 and 2021.

(15) 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:

			December31,2022			December31,2021
Present value of defined benefit obligations			20,037			18,546
Fair value of plan assets	(		14,153)	(		12,865)
Net defined benefit liability		$	5,884		$	5,681

~43~

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

Year ended December 31, 2022

			Present value
			of defined		Fair value of			Net defined
		benefit obligations			planassets		benefitliability
Balance at January 1		$	18,546	($	12,865)		$	5,681
Interest expense (income)			93	(	65)			28
			18,639	(	12,930)			5,709
Remeasurements:
Return on plan assets (excluding
amounts included in interest
income or expense)			-	(	1,017)	(		1,017)
Change in financial assumptions	(		331)		-	(		331)
Experience adjustments			1,729		-			1,729
			1,398	(	1,017)			381
Pension fund contribution			-	(	206)	(		206)
Balance at December 31		$	20,037	($	14,153)		$	5,884
			YearendedDecember31,			2021
			Present value
			of defined		Fair value of			Net defined
		benefit obligations			planassets		benefitliability
Balance at January 1		$	19,078	($	12,412)		$	6,666
Interest expense (income)			71	(	47)			24
			19,149	(	12,459)			6,690
Remeasurements:
Return on plan assets (excluding
amounts included in interest
income or expense)			-	(	173)	(		173)
Change in demographic
assumptions			276		-			276
Change in financial assumptions	(		130)		-	(		130)
Experience adjustments	(		749)		-	(		749)
	(		603)	(	173)	(		776)
Pension fund contribution			-	(	233)	(		233)
Balance at December 31		$	18,546	($	12,865)		$	5,681

(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 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-the-

~44~

counter, 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, 2022 and 2021 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	December31,2022 December31,2021 1.13% 0.50% 2.50% 2.25%

Future mortality rate was estimated based on the 6th Taiwan Standard Ordinary Experience Mortality Table for the years ended December 31, 2022 and 2021, respectively. Sensitivity analysis of the effect on present value of defined benefit obligation due from the changes of main actuarial assumptions was as follows:

==> picture [447 x 32] intentionally omitted <==

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

Discount rate Future salary increases
Increase 0.25% Decrease 0.25% Increase 0.25% Decrease 0.25%
----- End of picture text -----

December 31, 2022 Effect on present value of defined benefit obligation 209) ($ December 31, 2021 Effect on present value of defined benefit obligation 130) ($	215 $ 403 $	208 $ 204) ($ 393 $ 122) ($

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 were consistent with previous period.

• (f) Expected contributions to the defined benefit pension plans of the Group for the year ending December 31, 2023 amount to $ 204.

~45~

  - (g) As of December 31, 2022, the weighted average duration of that retirement plan is 4.2 years.

• 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, 2022 and 2021 were both 16%. Other than the monthly contributions, the Group has no further obligations.

  • (c) For the aforementioned pension plan, the Group recognised pension costs of $15,652 and $14,052 for the years ended December 31, 2022 and 2021, respectively.

• (16) Share capital

• A. As of December 31, 2022, the Company’s authorised capital was $1,000,000, constituting 100,000 thousand shares and the paid-in capital was $741,239 with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected.

• B. The Company reacquired treasury shares in 2018. After a comprehensive consideration of the stock price and as the treasury shares were not reissued to the employees within three years from the reacquisition date, the treasury shares reacquired to be reissued to employees were retired and registered pursuant to the Article 28-2 of Securities and Exchange Act. The capital reduction amounted to $150 consisting of 15 thousand shares retired. The paid-in capital before and after the capital reduction was $741,389 and $741,239, respectively.

• C. Movements in the number of the Company’s ordinary shares outstanding are as follows:

At January 1 and December 31	2022 2021 Number of thousand shares Number of thousand shares 74,124 74,124

• D. Treasury shares

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

company holding the shares	Reason for reacquisition		December	December	Carrying amount 31,2022		thousand shares Carrying amount 15 526 $ December31,2021	thousand shares Carrying amount 15 526 $ December31,2021
			thousand shares				thousand shares
The Company	To be reissued to employees		-		- $		15	526 $

• (b) Pursuant to the R.O.C. Securities and Exchange Act, the number of shares bought back as

~46~

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.

• (17) 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, 2022 December 31, 2021

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 $ 1,163,298 Difference between consideration and carrying amount of subsidiaries acquired $ 2,125 $ 2,125 Used to offset accumulated deficits only (Note 2) Changes in ownership interests in subsidiaries $ 27,926 $ 27,926

• 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.

~47~

(18) 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 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 appropriations of 2021 and 2020 earnings had been resolved at the shareholders’ meeting on May 27, 2022 and August 30, 2021, respectively. Details are summarized below:

Year ended December 31

	YearendedDecember31	ecember31	ecember31
Legal reserve appropriated Special reserve appropriated (reversed) Cash dividend	Dividend per Dividend per share share Amount (indollars) Amount (indollars) 13,637 $ 11,779 $ 14,829 14,269) ( 148,248 2.00 $ 148,248 2.00 $ 2021 2020	2020
	Amount 13,637 $ 14,829 148,248		Dividend per share (indollars)
			2.00 $

~48~

• F. The appropriations of 2022 earnings have been approved by the Board of Directors during their meetings on March 13, 2023. Details are summarised below:

		Year ended December31,2022	Year ended December31,2022	Year ended December31,2022
				Dividend per
		Amount		share (in dollars)
Legal reserve		40,788 $
Special reserve	(	10,898)
Cash dividends		222,372	$	3.00

• G. Refer to Note 6 (24) for further information relating to employees’ compensation and directors’ remuneration.

(19) 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:

Year ended December 31, 2022

Auto parts Others Auto parts Others		Domestic operating entities
		Domestic operating entities 1,072,371 $ 33,498 1,105,869 $		Overseas operating entities 787,960 $ 24,271 812,231 $	Total
					1,860,331 $ 57,769
					1,918,100 $

B. Contract liabilities

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

Contract liabilities: Contract liabilities - advance sales receipts	December31,2022 14,852 $	December31,2021 January 1, 2021 17,912 $ 20,177 $

For the the years ended December 31, 2022 and 2021, revenue recognised that were included in the contract liability balance at the beginning of the period amounted to $6,503 and $5,580, respectively.

~49~

(20) Other income

Rent income Dividend income Other income	2022 2021 8,139 $ 6,662 $ 4,958 4,111 20,361 11,144 33,458 $ 21,917 $ Year ended December31,

(21) Other gains and losses

Other gains and losses
			Year ended December			31,
			2022			2021
Gains on disposal of property, plant and equipment		$	3,798		$	4,528
Foreign exchange gains (losses)			306,502	(		60,045)
Gains on financial assets and liabilities at fair value through profit or loss			39,275			47,204
Other losses	(		28,236)	(		1,696)
		$	321,339	($		10,009)

(22) Finance costs

Finance costs
		Year ended December31,
		2022	2021
Interest expense	$	27,520	20,547 $
Less: Capitalisation of qualifying assets	(	1,193)	1,972) (
	$	26,327	18,575 $

(23) Expenses by nature

Expenses by nature
Employee benefit expense Depreciation charges on property, plant and equipment Depreciation charges on right-of-use assets Depreciation charges on investment property Amortisation	YearendedDecember31,
	2022 338,281 $ 361,492 6,383 1,116 7,087 714,359 $	2021
		334,796 $ 333,117 5,698 931 7,483
		682,025 $

~50~

(24) Employee benefit expense

Employee benefit expense
		Yearended	December	31,
		2022		2021
Wages and salaries	$	278,344	$	274,299
Labour and health insurance fees		19,029		22,539
Pension costs		15,858		14,076
Other personnel expenses		25,050		23,882
	$	338,281	$	334,796

• 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, 2022 and 2021, the accrued employees’ compensation and directors’ remuneration were as follows:

directors’ remuneration were as follows:
Employees’ compensation Directors’ remuneration	Year ended December31,
	2022 2021 7,360 $ 4,670 $ 5,661 4,017 13,021 $ 8,687 $

For the years ended December 31, 2022 and 2021, the employees’ compensation and directors’ remuneration were estimated and accrued based on 1.32% and 2.5% as well as 1.02% and 2.15%, respectively, of distributable profit of current year as of the end of reporting period.

• C. Employees’ compensation and directors’ remuneration of 2021 as resolved by the Board of Directors were in agreement with those amounts recognised in the 2021 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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(25) Income tax

A. Income tax expense

(a)Components of income tax expense

Current tax: Current tax on profits for the period Prior year income tax under (over)estimation Origination and reversal of temporary differences Income tax expense	2022 2021 125,431 $ 36,174 $ 6 428) ( 793 6,961 126,230 $ 42,707 $ YearendedDecember31,

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

follows:
	Years ended	December 31,
	2022		2021
Remeasurement of defined benefit
obligations	76 $	($	155)

B. Reconciliation between income tax expense and accounting profit

			Years ended	December31,	December31,
			2022		2021
Tax calculated based on profit before tax
and statutory tax rate		$	79,244	$	18,876
Expenses disallowed by tax regulation			4,431		408
Tax exempt income by tax regulation	(		2,097)	(	6,428)
Temporary differences not recognized
as deferred tax assets			18,073		15,749
Taxable loss not recognised as deferred
tax assets			26,573		14,846
Change in assessment of realisation of
deferred tax assets			-	(	316)
Prior year income tax overestimation			6	(	428)
Income tax expense		$	126,230	$	42,707

• 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% Other China subsidiaries Applicable tax rate:25%

~52~

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

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 Deferred tax liabilities: Gains on valuation of financial instruments at fair value through profit or loss			2022
	Recognised in profit January1 or loss 9,876 $ 2,336 $ 6,484 560 4,284 588) ( 2,422 2,422) ( 1,325 150 80,563 - 3,217 530) ( 108,171 $ 494) ($ - $ 513) ($ 108,171 $ 1,007) ($

~53~

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			2021
	Recognised Recognised in other Net in profit comprehensive exchange January1 or loss income differences 9,401 $ 548 $ - $ 73) ($ 5,727 815 - 58) ( 8,890 4,606) ( - - 5,461 3,039) ( - - 1,522 42) ( 155) ( - 80,563 - - - 3,723 558) ( - 52 115,287 $ 6,882) ($ 155) ($ 79) ($				December31
					9,876 6,484 4,284 2,422 1,325 80,563 3,217
					108,171 $

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

	December31,2022	December31,2022
Year incurred 2018 2019 2020 2021 2022	Amountfiled/assessed Assessed Assessed Assessed Assessed Amount estimated to file	Unused amount 70,910 $ 35,075 21,699 59,507 106,559 293,750 $	Unrecognised deferred tax assets 70,910 $ 35,075 21,699 59,507 106,559 293,750 $	Expiry year
				2028 2029 2030 2031 2032

~54~

December 31, 2021

December31,2021
Unrecognised Year Unused deferred tax incurred Amount filed/assessed amount assets 2018 Assessed 70,910 $ 70,910 $ 2019 Assessed 35,075 35,075 2020 Assessed 21,699 21,699 2021 Amount estimated to file 59,507 59,507 187,191 $ 187,191 $	Expiry year
	2028 2029 2030 2031

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

are as follows:
	December 31, 2022	December 31, 2021
Deductible temporary differences	330,629 $	240,253 $

• G. The Company’s and domestic subsidiaries’ income tax returns through 2020 have been assessed and approved by the Tax Authority.

• As of December 31, 2022, relevant information of current income tax liabilities and non-current income tax liabilities is as follows:

==> picture [469 x 139] intentionally omitted <==

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

H. December 31, 2022 December 31, 2021
Income tax payable Income tax payable
Current Non-current Current Non-current
(within one year) (over one year) (within one year) (over one year)
2019 $ - $ - $ 11,681 $ -
2020 21,025 10,513 21,025 31,538
2021 11,999 17,998 36,003 -
2022 110,840 - - -
$ 143,864 $ 28,511 $ 68,709 $ 31,538
----- End of picture text -----

• (a) The Company incurred an income tax of $35,997 from the 2021 profit-seeking enterprise income tax (including the filing of unappropriated retained earnings of 2020), and applied for the installment payments in accordance with Article 26 of the Tax Collection Act and Decree No.11004575510 issued by the Ministry of Finance, R.O.C. on September 3, 2021.

• (b) The Company incurred an income tax of $63,075 from the 2020 profit-seeking enterprise income tax (including the filing of unappropriated retained earnings of 2019), 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.

• (c) 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.

~55~

(26) Earnings per share

Earnings per share
		Year ended December31,		2022
			Weighted average
			number of ordinary
			shares outstanding	Earnings per share
	Amount	after tax	(share in thousands)		(in dollars)
Basic earnings per share
Profit attributable to ordinary
shareholders of the parent	$	408,560	74,124	$	5.51
Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent		408,560	74,124
Assumed conversion of all
dilutive potential ordinary shares
-Employees’ compensation		-	212
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all dilutive
potential ordinary shares	$	408,560	74,336	$	5.50
		Year ended December31,		2021
			Weighted average
			number of ordinary
			shares outstanding	Earnings per share
	Amount	after tax	(share in thousands)		(in dollars)
Basic earnings per share
Profit attributable to ordinary
shareholders of the parent	$	135,753	74,124	$	1.83
Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent		135,753	74,124
Assumed conversion of all
dilutive potential ordinary shares
-Employees’ compensation		-	161
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all dilutive
potential ordinary shares	$	135,753	74,285	$	1.83
The number of weighted-average outstanding		shares is	included for assumed conversion of all
dilutive potential ordinary shares at the calculation of diluted earnings per share, based on the
assumption that employees’ compensation will all be distributed in the form of shares.

~56~

(27) Supplemental cash flow information

A. Investing activities with partial cash payments:

Supplemental cash flow information A. Investing activities with partial cash payments:
		YearendedDecember31,2022
Purchase of property, plant and equipment	$		421,852
Add: Opening balance of payable on equipment
and construction			48,234
Ending balance of prepayments for business facilities			129,261
Less: Ending balance of payable on equipment
and construction	(		65,309)
Ending balance of notes payable	(		102,954)
Opening balance of prepayments for business
facilities	(		65,368)
Cash paid during the year	$		365,716
		YearendedDecember31,2021
Purchase of property, plant and equipment	$		404,018
Add: Opening balance of payable on equipment and
construction			34,547
Ending balance of prepayments for business facilities			65,368
Less: Ending balance of payable on equipment and
construction	(		48,234)
Ending balance of notes payable			-
Opening balance of prepayments for business
facilities	(		148,897)
Cash paid during the year	$		306,802
B. Investing activities with partial cash payments :
		YearendedDecember31,2022
Purchase of financial assets at fair value through
profit or loss	$		100,050
Add: Opening balance of securities payables (shown as other payables)			3,573
Less: Ending balance of securities payables
(shown as other payables)	(		1,383)
Cash paid during the year	$		102,240

~57~

	YearendedDecember31,2021	YearendedDecember31,2021
Purchase of financial assets at fair value through
profit or loss	$	124,700
Add: Opening balance of securities payables		-
(shown as other payables)
Less: Ending balance of securities payables
(shown as other payables)	(	3,573)
Cash paid during the year	$	121,127

(Remainder of page intentionally left blank)

~58~

(28) Changes in liabilities from financing activities

									Long-term
									borrowings	Guarantee		Lease liabilities					Liabilities from
			Short-term	Short-term notes					(including		deposits		(including non-			Dividends		financing
		borrowings		and billspayable				currentportion)			received			current)		payable	activitiesgross
At January 1, 2022		$	264,330		$	50,000		$	646,025	$	929		$	2,337	$	-	$	963,621
Changes in cash flow from financing activities	(		9,567)	(		50,000)			86,705	(	132)	(		2,668)	(	148,248)	(	123,910)
Impact of changes in foreign exchange rate			4,311			-			-		24			-		-		4,335
Changes in other non-cash
items			2,647			-			3,302		-			7,024		148,248		161,221
At December 31, 2022		$	261,721	$		-		$	736,032	$	821		$	6,693	$	-	$	1,005,267
									Long-term
									borrowings	Guarantee		Lease liabilities					Liabilities from
			Short-term	Short-term notes					(including		deposits		(including non-			Dividends		financing
		borrowings		and bills payable				current portion)			received			current)		payable	activities gross
At January 1, 2021		$	333,396	$		-		$	712,560	$	935		$	2,931	$	-	$	1,049,822
Changes in cash flow from financing activities	(		67,223)			50,000	(		67,241)		-	(		594)	(	148,248)	(	233,306)
Impact of changes in foreign exchange rate	(		1,965)			-	(		329)	(	6)			-		-	(	2,300)
Changes in other non-cash
items			112			-			1,035		-			-		148,248		149,395
At December 31, 2021		$	264,320		$	50,000		$	646,025	$	929		$	2,337	$	-	$	963,611

~59~

7. Related Party Transactions

Key management compensation

Related Party Transactions Key management compensation
		Yearended	December	31,
		2022		2021
Salaries and other short-term employee benefits	$	28,614	$	21,122
Post-employment benefits		24		20
	$	28,638	$	21,142

8. Pledged Assets

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

Pledged Assets The Group’s assets pledged as collateral are as follows:
Pledged asset December31,2022 December31,2021 Property, plant and equipment 1,237,237 $ 1,191,921 $ Right-of-use assets 77,852 79,307 Investment property 14,813 15,477 Financial assets at amortised cost - non-current 300 300 Other financial assets (shown as other current assets) - 1,475 Total 1,330,202 $ 1,288,480 $ Bookvalue	Purpose
	Short-term borrowings and long-term borrowings Short-term borrowings Short-term borrowings Natural gas for manufacturing Guarantee for acceptance bill

9. Significant Contingent Liabilities and Unrecognised Contract Commitments

(1) Contingencies

None.

(2) Commitments

As at December 31, 2022 and 2021, the Group’s capital expenditure contracted but not yet incurred in respect of machinery and equipment as well as construction of plants were $517,281 and $327,900, 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).

~60~

• 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 bonds based on the advices from the management.

(2) Financial instruments

• A. Financial instruments by category

ncial 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 Guarantee deposits paid	December31,2022 129,623 $ 75,247 $ 1,036,374 $ 300 27,081 534,281 10,366 - 4,092 1,612,494 $	December31,2021
		117,251 $
		48,308 $
		635,392 $ 199,716 55,055 441,993 10,792 1,475 2,295
		1,346,718 $

~61~

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

December 31, 2022 December 31, 2021
Financial liabilities
Financial liabilities at fair value
through profit or loss
Financial liabilities held for trading $ - $ 12,111
Financial liabilities at amortised cost
Short-term borrowings $ 261,721 $ 264,320
-
Short-term notes and bills payable 50,000
Notes payable 179,968 92,502
Accounts payable 141,453 157,602
Other payables 197,101 145,514
Long-term borrowings (including
736,032 646,025
current portion)
Guarantee deposits received 821 929
$ 1,517,096 $ 1,356,892
Lease liabilities (including current
portion) $ 6,693 $ 2,337
----- End of picture text -----

• 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 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).

~62~

• 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: New Taiwan Dollars, 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:

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD USD : RMB Financial liabilities Monetary items USD : RMB		Foreign currency amount (In thousands) Exchange rate Book value (NTD) 36,581 $ 30.71 1,123,403 $ 287 6.96 8,807 2,720 $ 30.71 83,531 $ December31,2022	Foreign currency amount (In thousands) Exchange rate Book value (NTD) 36,581 $ 30.71 1,123,403 $ 287 6.96 8,807 2,720 $ 30.71 83,531 $ December31,2022	Foreign currency amount (In thousands) Exchange rate Book value (NTD) 36,581 $ 30.71 1,123,403 $ 287 6.96 8,807 2,720 $ 30.71 83,531 $ December31,2022
		Foreign currency amount (In thousands)	Exchange rate
		36,581 $ 287 2,720 $	30.71 6.96 30.71	1,123,403 $ 8,807 83,531 $

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

December 31, 2021
Foreign
currency
amount Book value
(In thousands) Exchange rate (NTD)
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD : NTD $ 29,014 27.68 $ 803,097
Financial liabilities
Monetary items
USD : RMB $ 1,500 6.37 $ 41,532
----- End of picture text -----

The Group conducts foreign exchange swap contracts. Foreign currency amount is the notional principal. Exchange rate is estimated to be settled at the balance sheet date, and the book value is the amount recognised.

iv. The total exchange gain (loss), including realised and unrealised, arising from significant foreign exchange variation on the monetary items held by the Group for the years ended December 31, 2022 and 2021, amounted to 306,502 and ($60,045), respectively.

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

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD USD : RMB Financial liabilities Monetary items USD : RMB	YearendedDecember31,2022 Sensitivity analysis	YearendedDecember31,2022 Sensitivity analysis	YearendedDecember31,2022 Sensitivity analysis
	Degree of variation 1% 1% 1%	Effect onprofit or loss 11,234 $ 88 835 $	Effect on other comprehensive income
			- $ - $

~64~

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD Financial liabilities Monetary items USD : RMB	Degree of Effect on other comprehensive variation Effect onprofit or loss income 1% 8,031 $ - $ 1% 415 $ - $ YearendedDecember31,2021 Sensitivity analysis

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 the years ended December 31, 2022 and 2021 would have decreased/increased by $3,918 and $1,173, 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 $701 and $483 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 the years ended December 31, 2022 and 2021, 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, 2022 and 2021 would have increased/decreased by $998 and $914, respectively. The main factor is that changes in interest expense result in floating-rate borrowings.

~65~

(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, 2022 and 2021, accumulated loss allowance provided for individually assessed receivables amounted to $29,383 and $29,840, respectively. 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, 2022 and 2021, the provision matrix is as follows:

December 31, 2022 Expected loss rate Total book value Loss allowance		Not past due		1 to 60 days	61 to 120 days		121 to 180 days	181 to 240 days	Over 241 days	Total
		0%~1% 508,355 $ 2,044) ( $ 506,311		1%~10% 52,368 $ 4,291) ( $48,077	30%~50% 10,777 $ 5,735) ( $ 5,042		30%~50% 4,804 $ 2,872) ( $1,932	100% 1,414 $ 1,414) ( $-	100% 19,091 $ 19,091) ( $-	596,809 $ 35,447) ( $ 561,362

~66~

December 31, 2021 Expected loss rate Total book value Loss allowance

Not past due 0%-3% 449,496 $ 1,271) ( $ 448,225	1 to 60 days 3%-10% 45,462 $ 1,344) ( $ 44,118	61 to 120 days 30%-35% 4,590 $ 1,383) ( $ 3,207		121 to 180 days 40%-50% 2,750 $ 1,252) ( $ 1,498	181 to 240 days 100% 324 $ 324) ( $ -	Over 241 days	Total 515,331 $ 18,283) ( $ 497,048
						100% 12,709 $ 12,709) ( $ -

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 (reversal of) impairment loss Written-Off Effect of foreign exchange At December 31 At January 1 Provision for (reversal of) impairment loss Effect of foreign exchange At December 31		2022

(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.

ii. The Group has the following undrawn borrowing facilities:

Fixed rate: Expiring within one year Expiring beyond one year Floating rate: Expiring within one year	December31,2022 - $ - 303,089 303,089 $	December31,2021
		300,000 $ 192,540 -
		492,540 $

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• 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:	ties:
December 31, 2022 Less than 1year Short-term borrowings 266,464 $ Notes payable 179,968 Accounts payable 141,453 Other payables 197,101 Lease liability 2,299 Long-term borrowings (including current portion) 176,790 Derivative financial assets: December 31, 2022 Less than 1year Foreign exchange swap contracts 2,565 $ Non-derivative financial liabilities: December 31, 2021 Less than 1year Short-term borrowings 266,230 $ Short-term notes and bills payable 50,000 Notes payable 92,502 Accounts payable 157,602 Other payables 145,514 Lease liability 622 Long-term borrowings (including current portion) 111,089 Derivative financial liabilities: December 31, 2021 Less than 1year Foreign exchange swap contracts 12,111 $	Less than 1year	Between 1 and 2 years	Between 2 and 3 years	Between 3 and 5 years	Over 5 years	Total
	266,464 $ 179,968 141,453 197,101 2,299 176,790 Less than 1year	- $ - - - 1,739 155,796 Between 1 and 2 years	- $ - - - 1,630 153,963 Between 2 and 3 years	- $ - - - 1,177 183,047 Between 3 and 5 years	- $ - - - - 92,287 Over 5 years	266,464 $ 179,968 141,453 197,101 6,845 761,883 Total
		- $ Between 1 and 2 years	- $ Between 2 and 3 years	- $ Between 3 and 5 years	- $ Over 5 years	2,565 $ Total
December 31, 2021 Short-term borrowings Short-term notes and bills payable Notes payable Accounts payable Other payables Lease liability Long-term borrowings (including current portion) Derivative financial liabilities:
	266,230 $ 50,000 92,502 157,602 145,514 622 111,089 Less than 1year	- $ - - - - 622 87,286 Between 1 and 2 years	- $ - - - - 622 90,462 Between 2 and 3 years	- $ - - - - 519 206,968 Between 3 and 5 years	- $ - - - - - 174,650 Over 5 years	266,230 $ 50,000 92,502 157,602 145,514 2,385 670,455 Total
December 31, 2021 Foreign exchange swap contracts
	12,111 $	$ -	$ -	$ -	$ -	12,111 $

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(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. 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 other receivables, financial assets at amortised cost, guarantee deposits paid, short-term borrowings, notes payable, accounts payable other payables, long-term borrowings (including current portion) , guarantee deposits received and lease liabilities (including current portion).

(Remainder of page intentionally left blank)

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• C. 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, 2022 and 2021, are as follows:

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

==> picture [440 x 360] intentionally omitted <==

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

Level 1 Level 2 Level 3 Total
December 31, 2022
Assets
Recurring fair value measurements
Financial assets at fair value through
profit or loss $ 127,059 $ 2,564 $ - $ 129,623
Financial assets at fair value through
other comprehensive income
- Equity securities $ 75,247 $ - $ - $ 75,247
Level 1 Level 2 Level 3 Total
December 31, 2021
Assets
Recurring fair value measurements
Financial assets at fair value through
profit or loss $ 117,251 $ - $ - $ 117,251
Financial assets at fair value through
other comprehensive income
- Equity securities $ 48,308 $ - $ - $ 48,308
Liabilities
Recurring fair value measurements
Financial liabilities at fair value through
profit or loss $ - $ 12,111 $ - $ 12,111
----- End of picture text -----

• (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.

• D. For the years ended December 31, 2022 and 2021, there was no transfer between Level 1 and Level 2.

• E. For the years ended December 31, 2022 and 2021, 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 the manufacture of parts for the interior and exterior of automobiles and manages the business from a geographic perspective due to the different characteristics in culture, environment and economic condition although the manufacturing 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 Chief Operating Decision-Maker evaluates the performance of the operating segments based on a measure of adjusted profit from operations. This measurement basis excludes the effects of nonrecurring expenditure from the operating segments.

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(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 operation entities Foreign operation entities Others Inter-segment eliminations Total amount from continuing operations Interest income Rent income Dividend income Other income - others Foreign exchange gain (loss) Gain on financial assets and liabilities at fair value through profit or loss Gain on disposal of property, plant and equipment Other losses Finance costs Profit before income tax	Year ended December31,2022 Year ended December31,2021 1,251,975 $ 1,100,787 $ 785,354 841,714 19,862 57,769 36,433) ( 82,170) ( 2,020,758 $ 1,918,100 $ Segmentrevenue		Year ended December31,2022 Year ended December31,2021 229,043 $ 215,135 $ 76,067) ( 79,618) ( 414) ( 6,256 27,440 32,716 180,002 $ 174,489 $ 18,751 2,584 8,139 6,662 4,958 4,111 20,361 11,144 306,502 60,045) ( 39,275 47,204 3,798 4,528 28,236) ( 1,696) ( 26,327) ( 18,575) ( 527,223 $ 170,406 $ Segmentincome (loss)
	1,251,975 $ 785,354 19,862 36,433) ( 2,020,758 $	1,100,787 $ 841,714 57,769 82,170) ( 1,918,100 $	229,043 $ 76,067) ( 414) ( 27,440 180,002 $ 18,751 8,139 4,958 20,361 306,502 39,275 3,798 28,236) ( 26,327) ( 527,223 $	215,135 $ 79,618) ( 6,256 32,716 174,489 $ 2,584 6,662 4,111 11,144 60,045) ( 47,204 4,528 1,696) ( 18,575) ( 170,406 $

(4) Information on products

Please refer to Note 6 (22) for the related information.

(5) Geographical information

Geographical information for the years ended December 31, 2022 and 2021 is as follows:

Taiwan China Others	Revenue Non-current assets 1,246,356 $ 2,421,925 $ 755,770 846,932 18,632 - 2,020,758 $ 3,268,857 $ 2022	2021	2021
		Revenue 1,105,869 $ 805,900 6,331 1,918,100 $	Non-current assets
			2,211,289 $ 855,814 -
			3,067,103 $

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 deferred income tax. Geographical information for the years ended December 31, 2022 and 2021 is stated as above.

~72~

(6) Major customer information

Major customer information of the Group for the years ended December 31, 2022 and 2021 is as follows:

follows:
			Years ended	December 31,
			2022			2021
		Revenue	Segment		Revenue	Segment
A Group	$	464,885	Domestic operations	$	382,202	Domestic operations
B customer		110,706	Foreign operations		53,332	Foreign operations
	$	575,591		$	435,534

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~73~

Table 1

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

Loans to others

Year ended December 31, 2022

Expressed in thousands of NTD

(Except as otherwise indicated)

No. (Note 1)	Creditor	Borrower	General ledger account	Is a related party	Maximum outstanding balance during the year ended December 31,2022	Balance at December 31, 2022 (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	Collateral	Collateral	Limit on loans granted to a single party (Note 3)	Ceiling on total loans granted(Note 3)	Footnote
													Item	Value
0 0 0	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. LIAONING HETAI AUTOMOTIVE PARTS CO.,LTD	Other receivables Other receivables Other receivables	Y Y Y	322,455 $ 347,210 255,664	107,485 $ 193,660 127,832	107,485 $ 61,420 127,885	1.40% 4.35% 4.35%	2 2 2	- $ - -	Operating capital Operating capital Operating capital	- $ - -	N N N	- $ - -	371,430 $ 371,430 371,430	1,485,723 $ 1,485,723 1,485,723	Notes 5 and 7 Notes 6 and 8 Note 9

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, 2022 and actual amount drawn down were calculated at the USD and RMB buying and selling spot exchange rate of 30.71 and 4.408 on December 31, 2022.

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: The maximum outstanding balance of loans granted to o RISE BRIGHT HOLDINGS LTD. by Y.C.C. amounted to NT$322,455. This is because the amount of NT$322,455 includes NT$214,970 that was matured on May 27, 2022. The remaining total facility was NT$107,485. Note 6: The maximum outstanding balance of loans granted to CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. by Y.C.C. amounted to NT$347,210. This is because the amount of NT$347,210 includes NT$92,130 that was matured on March 16, 2022 and the amount of NT$61,420 was paid off on January 28, 2022. Meanwhile, a new facility of NT$30,710 and NT$132,240 that were added at the Board of Directors’ meeting on March 10, 2022 and November, 11, 2022 respectively. The remaining total facility was NT$193,660. Note 7: Loans granted to RISE BRIGHT HOLDINGS LTD. approved by the Board of Directors amounted to US$3,500 thousand.

Note 8: Loans granted to CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. approved by the Board of Directors amounted to US$2,000 thousand and RMB$ 30,000 thousand. Note 9: Loans granted to LIAONING HETAI AUTOMOTIVE PARTS CO., LTD approved by the Board of Directors amounted to RMB$ 29,000 thousand.

Table 1, Page 1

Table 2

Expressed in thousands of NTD

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

Provision of endorsements and guarantees to others Year ended December 31, 2022

(Except as otherwise indicated)

Limit on Outstanding Amount of Ratio of accumulated Ceiling on total Provision of Provision of Provision of Party being endorsed/guaranteed endorsements/ Maximum outstanding endorsement/ Actual endorsements/ endorsement/ guarantee amount of endorsements/ endorsements/ endorsements/ Relationship with guarantees provided endorsement/ guarantees guarantee amount at amount guarantees amount to net asset endorsements/ guarantees by guarantees guarantees Number the endorser/ for a single party amount as of December 31, 2022 drawn down secured with value of the endorser/ guarantees provided parent company by subsidiary to to the party in (Note 1) Endorser/guarantor Company name guarantor (Note 2) (Note 3) December 31, 2022 (Note 5) (Note 4) collateral guarantor company (Note 3) to subsidiary parent company Mainland China Footnote 0 Y.C.C. PARTS MFG. CHANGSHU FUTE 3 $ 742,861 $ 76,775 $ - $ - - 0.00% $ 1,485,723 Y N Y Note 5 CO., LTD. AUTOMOTIVE TRIM CO., LTD.

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, 2022 and actual amount drawn down were calculated at the USD buying and selling spot exchange rate of 30.71 on December 31, 2022.

Note 5: Endorsements and guarantees to CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. approved by the Board of Directors amounted to US$3,000 thousand. Unused amount of US$1,000 thousand has been cancelled by the Board of Directors on August 9, 2022.

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, 2022

Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As of December 31,2022	As of December 31,2022		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. 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. UNITED SKILLS CO., LTD. UNITED SKILLS CO., LTD. UNITED SKILLS CO., LTD. UNITED SKILLS CO., LTD. UNITED SKILLS CO., LTD. UNITED SKILLS CO., LTD. Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD.	HIROCA HOLDINGS LTD. GORDON AUTO BODY PARTS CO., LTD. ROUNDTOP MACHINERY INDUSTRIES CO., LTD. LASTER TECH CO., LTD. SHUN ON ELECTRONIC CO., LTD. NUUO INC. TANVEX BIOLOGICS CORPORATION ROUNDTOP MACHINERY INDUSTRIES CO., LTD. EVERGREEN MARINE CO., LTD. WANHWA ENTERPRISE COMPANY SHIEH YIH MACHINERY INDUSTRY CO., LTD. COWEALTH MEDICAL HOLDING CO., LTD. GLOBAL BRANDS MANUFACTURE LTD. TANVEX BIOLOGICS CORPORATION HIROCA HOLDINGS LTD. GORDON AUTO BODY PARTS CO., LTD.	N N N N N N N N N N N N N N N N	Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Valuation adjustment Non-current financial assets at fair value through other comprehensive income Non-current financial assets at fair value through other comprehensive income Valuation adjustment	443,000 2,518,000 67,000 40,000 73,000 5,071 833,000 355,000 10,000 100,000 62,000 68,000 20,000 5,000 855,000 1,552,000	27,517 $ 25,540 1,030 1,381 3,342 278 37,716 5,132 1,590 1,228 680 2,038 769 235 18,582 127,058 $ 81,856 $ 19,931 (26,540) 75,247 $	0.53% 1.52% 0.08% 0.04% 0.05% 0.04% 0.24% 0.42% 0.00% 0.02% 0.04% 0.09% 0.00% 0.00% 1.02% 0.94%	19,004 $ 62,572 1,022 1,380 2,329 181 29,238 5,415 1,630 1,220 651 1,690 551 175
							127,058 $
							36,680 $ 38,567
							75,247 $

Table 3, Page 1

Table 4

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, 2022

Expressed in thousands of NTD

(Except as otherwise indicated)

Creditor	Counterparty	Relationship with the counterparty	Balance as at December 31, 2022 (Note 1)	Turnover rate (Note 4)	Overdue receivables	Overdue receivables	Amount collected subsequent to the balance sheet date (Note 5)	Allowance for doubtful accounts	Footnote
					Amount	Action taken
Y.C.C. PARTS MFG. CO., LTD. Y.C.C. PARTS MFG. CO., LTD.	LIAONING HETAI AUTOMOTIVE PARTS CO., LTD RISE BRIGHT HOLDINGS LTD.	Subsidiary Subsidiary	136,280 $ 117,991	- 10.00	- $ -	- -	- $ 430	- $ -	Note 2 Note 3

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

Note 2: It pertains to principal and interest aggregating to $129,474 from loans to the subsidiary and sales of equipment amounting to $6,806 shown as other receivables. Note 3: It pertains to principal and interest aggregating to $108,388 from loans to the subsidiary and sales of equipment and products amounting to $9,603 shown as other receivables. Note 4: Only accounts receivable was used for the calculation of turnover rate. Note 5: Subsequent collection is the amount collected as of February 28, 2023.

Table 4, Page 1

Table 5

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

Significant inter-company transactions during the reporting periods

Year ended December 31, 2022

Expressed in thousands of NTD

(Except as otherwise indicated)

Transaction

						Transaction
Number (Note1)	Companyname	Counterparty	Relationship (Note 2)	General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets (Note 3)
0 0 0 0 0 1 1 2	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. CHANG JIE TECHNOLOGY CO., LTD. CHANG JIE TECHNOLOGY CO., LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD.	RISE BRIGHT HOLDINGS LTD. RISE BRIGHT HOLDINGS LTD. CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. LIAONING HETAI AUTOMOTIVE PARTS CO.,LTD CHANG JIE TECHNOLOGY CO., LTD. Y.C.C. PARTS MFG. CO., LTD. LIAONING HETAI AUTOMOTIVE PARTS CO.,LTD CHANGSHU XINXIANG AUTOMOBILE PARTS CO., LTD.	1 1 1 1 1 2 3 3	Other receivables Revenue Other receivables Other receivables Accounts receivables Contract Liabilities Accounts receivables Other receivables	117,991 $ 13,351 67,233 136,280 11,080 11,758 10,168 22,650	Based on the contract Based on the contract Based on the contract Based on the contract Based on the contract Based on the contract Based on the contract Based on the contract	2.00% 0.70% 1.20% 2.40% 0.20% 0.20% 0.20% 0.40%

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, 2022

Expressed in thousands of NTD

Table 6										Expressed in thousands of NTD	Expressed in thousands of NTD
Investor	Investee	Location	Main business activities	Initial investment amount		Shares	held as at December 31,2022		Net profit (loss) of the investee for the year ended December 31,2022	Investment income (loss) recognised by the Company for the year ended December 31,2022 Footnote (Except as otherwise indicated)
				Balance as at December 31,2022	Balance as at December 31,2021	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 $ 1,235,358 1,158,673	50,000 $ 1,235,358 1,158,673	5,000 - -	100.00% 100.00% 89.44%	48,285 $ 525,692 468,991	1,334) ($ 90,367) ( 79,855) (	1,334) ($ 90,367) ( 71,422) (	Subsidiary Subsidiary (Note) Subsidiary (Note)

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

Table 6, Page 1

Table 7

Expressed in thousands of NTD (Except as otherwise indicated)

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

Information on investments in Mainland China

Year ended December 31, 2022

Investeein Mainland China	Mainbusiness activities	Paid-incapital	Investment method (Note1)	Accumulated amount of remittance from Taiwan to Mainland China as of January1,2022	Amount remitted from Taiwan to Mainland China/Amount remitted back to Taiwan for the Year endedDecember31,2022	Amount remitted from Taiwan to Mainland China/Amount remitted back to Taiwan for the Year endedDecember31,2022	Accumulated amount of remittance from Taiwan of Mainland China as of December31,2022	Net income of investee as of December31,2022	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the year ended December 31,2022(Note2)	Book value of investments in Mainland China as of December31,2022	Accumulated amount of investment income remitted back to Taiwan as of December31,2022	Footnte
					Remitted to Mainland China	Remitted back toTaiwan
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 60,450 176,406	2 2 2 2	827,609 $ 268,009 63,055 177,602	- $ - - -	- $ - - -	827,609 $ 268,009 63,055 177,602	84,618) ($ 5,141 1,425 16,730) (	89.44% 73.89% 89.44% 99.83%	75,682) ($ 3,799 1,275 16,702) (	199,392 $ 160,080 56,241 152,090	- $ - - -	Note 3 Note 7 Note 4 Note 5 Note 6

Note 1: Investment methods are classified into the following three categories:

(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$14,000 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$26,300 thousand.

Note 4: Paid-in capital is US$11,500 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$8,591 thousand.

Note 5: Paid-in capital is US$2,000 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$2,000 thousand.

Note 6: Paid-in capital is US$6,080 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$6,070 thousand.

Note 7: ‘Investment income (loss) recognised by the Company for the Year ended December 31, 2022 was based on the financial statements that were reviewed by parent company’s CPA.

Investment amount approved by the Investment Commission Ceiling on investments in Accumulated amount of remittance from of the Ministry of Mainland China imposed Taiwan to Mainland China as of Economic Affairs by the Investment Company name December 31, 2022 (MOEA) Commission of MOEA Y.C.C. PARTS MFG. CO., $ 1,336,275 $ 1,337,564 $ 2,228,585 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$42,961 thousand. The investment amount permitted by the Investment Commission of Ministry of Economic Affairs(MOEA) was US$42,951 thousand. Note 4: The investment amount permitted by the Investment Commission of Ministry of Economic Affairs(MOEA) to CHANG JIE TECHNOLOGY CO., LTD. was RMB$10,000 thousand.

There is US$10 thousand difference with MOEA due to exchange rate fluctuations. Paid-in capital is US$1,560 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$1,570 thousand.

Table 7, Page 1

Table 8

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

Major shareholders information

December 31, 2022

Name of major shareholders	Shares	Shares
	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 following 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.

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