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Y.C.C. Interim / Quarterly Report 2021

Nov 15, 2021

51783_rns_2021-11-15_81fb714c-4106-4e55-871b-9b6b63726501.pdf

Interim / Quarterly Report

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

CONSOLIDATED FINANCIAL STATEMENTS AND

INDEPENDENT AUDITORS’ REVIEW REPORT

SEPTEMBER 30, 2021 AND 2020

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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INDEPENDENT AUDITORS’ REVIEW REPORT TRANSLATED FROM CHINESE

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

Introduction

We have reviewed the accompanying consolidated balance sheets of Y.C.C. Parts Mfg. Co., Ltd. and subsidiaries (the “Group”) as at September 30, 2021 and 2020, and the related consolidated statements of comprehensive income for the three months and nine months then ended, as well as the related statements of changes in equity and of cash flows for the nine months then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” as endorsed by the Financial Supervisory Commission. Our responsibility is to express a conclusion on these consolidated financial statements based on our reviews.

Scope of review

Except as explained in the Basis for Qualified Conclusion, we conducted our reviews in accordance with the Statement of Auditing Standards No. 65, “Review of Financial Information Performed by the Independent Auditor of the Entity” in the Republic of China. A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis for qualified conclusion

As explained in Note 4(3), the financial statements of insignificant consolidated subsidiaries were not reviewed by independent auditors. Total assets of these subsidiaries amounted to NT$749,637 thousand and NT$571,460 thousand, constituting 14.79% and 10.70% of the consolidated total assets as at September 30, 2021 and 2020, respectively, total liabilities amounted to NT$265,884 thousand and

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NT$143,351 thousand, constituting 16.86% and 7.91% of the consolidated total liabilities as at September 30, 2021 and 2020, respectively, and the total comprehensive gain (loss) amounted to NT$396 thousand, (NT$11,490) thousand, (NT$8,710) thousand and (NT$4,584) thousand, constituting 9.63%, (19.51%), (16.32%) and (5.97%) of the consolidated total comprehensive gain (loss) for the three months and nine months then ended, respectively.

Qualified conclusion

Except for the adjustments to the consolidated financial statements, if any, as might have been determined to be necessary had the financial statements of consolidated subsidiaries been reviewed by independent auditors as described in the Basis for qualified conclusion section above, based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as at September 30, 2021 and 2020, and of its consolidated financial performance for the three months and nine months then ended and its consolidated cash flows for the nine months then ended in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and International Accounting Standard 34, “Interim Financial Reporting” as endorsed by the Financial Supervisory Commission.

Wang, Yu-Chuan Liu, Mei-Lan

For and on behalf of PricewaterhouseCoopers, Taiwan November 12, 2021

The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and independent auditors’ review 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 SEPTEMBER 30, 2021, DECEMBER 31, 2020 AND SEPTEMBER 30, 2020 (Expressed in thousands of New Taiwan dollars) (The balance sheets as of September 30, 2021 and 2020 are reviewed, not audited)

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September 30, 2021 December 31, 2020 September 30, 2020
Assets Notes AMOUNT % AMOUNT % AMOUNT %
Current assets
1100 Cash and cash equivalents 6(1) $ 607,924 12 $ 742,410 14 $ 657,399 12
1110 Financial assets at fair value 6(2)
through profit or loss - current 101,973 2 18,301 - 38,684 1
1136 Financial assets at amortised cost - 6(4)
current 252,685 5 261,058 5 423,203 8
1150 Notes receivable, net 6(5) 82,079 2 29,553 - 55,695 1
1170 Accounts receivable, net 6(5) 433,971 9 591,658 11 555,340 10
1200 Other receivables 5,854 - 3,579 - 6,028 -
130X Inventories 6(6) 326,315 6 302,754 6 302,728 6
1470 Other current assets 6(7) and 8 69,347 1 86,426 2 41,022 1
11XX Current Assets 1,880,148 37 2,035,739 38 2,080,099 39
Non-current assets
1517 Financial assets at fair value 6(3)
through other comprehensive
income - non-current 40,272 1 52,241 1 47,281 1
1535 Financial assets at amortised cost - 6(4) and 8
non-current 300 - 300 - 327 -
1600 Property, plant and equipment 6(8) and 8 2,804,210 55 2,767,101 52 2,631,976 49
1755 Right-of-use assets 6(9) and 8 140,434 3 146,668 3 141,871 3
1760 Investment property, net 6(10) and 8 15,575 - 16,506 1 16,369 -
1780 Intangible assets 6(11) 6,971 - 8,203 - 37,428 1
1840 Deferred income tax assets 108,584 2 115,287 2 110,483 2
1900 Other non-current assets 6(12) 71,756 2 156,356 3 273,283 5
15XX Total non-current assets 3,188,102 63 3,262,662 62 3,259,018 61
1XXX Total assets $ 5,068,250 100 $ 5,298,401 100 $ 5,339,117 100
(Continued)
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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2021, DECEMBER 31, 2020 AND SEPTEMBER 30, 2020

(Expressed in thousands of New Taiwan dollars)

(The balance sheets as of September 30, 2021 and 2020 are reviewed, not audited)

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September 30, 2021 December 31, 2020 September 30, 2020
Liabilities and Equity Notes AMOUNT % AMOUNT % AMOUNT %
Current liabilities
2100 Short-term borrowings 6(13) $ 402,915 8 $ 333,396 6 $ 436,316 8
2120 Financial liabilities at fair value 6(2)
through profit or loss - current 4,560 - 27,305 1 10,214 -
2130 Current contract liabilities 6(21) 19,245 1 20,177 - 21,177 1
2150 Notes payable 84,684 2 118,492 2 109,758 2
2170 Accounts payable 151,343 3 251,103 5 246,520 5
2200 Other payables 6(14) 116,331 2 134,314 3 122,584 2
2230 Current income tax liabilities 6(28) 60,526 1 78,868 1 69,185 1
2320 Long-term liabilities, current 6(15)
portion 112,797 2 137,261 3 156,565 3
2399 Other current liabilities, others 1,751 - 1,507 - 643 -
21XX Current Liabilities 954,152 19 1,102,423 21 1,172,962 22
Non-current liabilities
2540 Long-term borrowings 6(15) 566,073 11 575,299 11 607,427 11
2560 Income tax liabilities - non-current 6(28) 42,163 1 20,630 - 24,469 1
2600 Other non-current liabilities 6(9)(16) 15,068 - 14,388 - 7,787 -
25XX Total non-current liabilities 623,304 12 610,317 11 639,683 12
2XXX Total Liabilities 1,577,456 31 1,712,740 32 1,812,645 34
Equity attributable to owners of
parent
Share capital 6(18)
3110 Share capital - common stock 741,389 15 741,389 14 741,389 14
Capital surplus 6(19)
3200 Capital surplus 1,193,259 24 1,193,259 23 1,193,024 23
Retained earnings 6(20)
3310 Legal reserve 329,574 7 317,795 6 317,795 6
3320 Special reserve 105,212 2 119,480 2 119,480 2
3350 Unappropriated retained earnings 1,135,908 22 1,203,831 23 1,174,236 22
Other equity interest
3400 Other equity interest ( 122,258)( 3)( 105,211)( 2)( 129,224)( 3)
3500 Treasury shares 6(18) ( 526) - ( 526) - ( 526) -
31XX Equity attributable to owners
of the parent 3,382,558 67 3,470,017 66 3,416,174 64
36XX Non-controlling interests 108,236 2 115,644 2 110,298 2
3XXX Total equity 3,490,794 69 3,585,661 68 3,526,472 66
Significant contingent liabilities and 9
unrecognised contract commitments
Significant events after the balance 11
sheet date
3X2X Total liabilities and equity $ 5,068,250 100 $ 5,298,401 100 $ 5,339,117 100
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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 THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

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

(UNAUDITED)

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Three months ended September 30 Nine months ended September 30
2021 2020 2021 2020
Items Notes AMOUNT % AMOUNT % AMOUNT % AMOUNT %
4000 Sales revenue 6(21) $ 462,340 100 $ 607,721 100 $ 1,443,711 100 $ 1,529,939 100
5000 Operating costs 6(6)(26)(27) ( 357,840) ( 77) ( 425,349) ( 70) ( 1,104,358) ( 77) ( 1,076,188) ( 71)
5900 Net operating margin 104,500 23 182,372 30 339,353 23 453,751 29
Operating expenses 6(26)(27)
6100 Selling expenses ( 25,477) ( 6) ( 31,915) ( 5) ( 89,715) ( 6) ( 92,559) ( 6)
6200 General and administrative
expenses ( 28,994) ( 6) ( 39,289) ( 7) ( 89,193) ( 6) ( 98,317) ( 6)
6300 Research and development
expenses ( 11,041) ( 2) ( 7,744) ( 1) ( 25,518) ( 2) ( 23,655) ( 2)
6450 Impairment loss (impairment 12(2)
gain and reversal of
impairment loss) determined in
accordance with IFRS 9 ( 2,517) ( 1) 1,883 - ( 1,928) - ( 1,468) -
6000 Total operating expenses ( 68,029) ( 15) ( 77,065) ( 13) ( 206,354) ( 14) ( 215,999) ( 14)
6900 Operating profit 36,471 8 105,307 17 132,999 9 237,752 15
Non-operating income and
expenses
7100 Interest income 6(22) 526 - 1,398 - 2,150 - 7,658 1
7010 Other income 6(23) 8,684 2 8,704 1 16,502 1 15,530 1
7020 Other gains and losses 6(24) ( 6,726) ( 2) ( 50,517) ( 8) ( 35,287) ( 2) ( 110,231) ( 7)
7050 Finance costs 6(25) ( 4,872) ( 1) ( 2,518) - ( 13,977) ( 1) ( 10,951) ( 1)
7000 Total non-operating income
and expenses ( 2,388) ( 1) ( 42,933) ( 7) ( 30,612) ( 2) ( 97,994) ( 6)
7900 Profit before income tax 34,083 7 62,374 10 102,387 7 139,758 9
7950 Income tax expense 6(28) ( 12,104) ( 2) ( 20,486) ( 3) ( 30,422) ( 2) ( 52,497) ( 3)
8200 Profit for the period $ 21,979 5 $ 41,888 7 $ 71,965 5 $ 87,261 6
----- End of picture text -----

(Continued)

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

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

(UNAUDITED)

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Three months ended September 30 Nine months ended September 30
2021 2020 2021 2020
Items Notes AMOUNT % AMOUNT % AMOUNT % AMOUNT %
Other comprehensive income
Components of other
comprehensive income that will
not be reclassified to profit or
loss
8316 Unrealised gains (losses) on 6(3)
valuation of equity instrument
at fair value through profit or
loss ($ 16,160) ( 4) ($ 258) - ($ 11,970) ( 1) ($ 10,261) ( 1)
8310 Components of other
comprehensive income that
will not be reclassified to
profit or loss ( 16,160) ( 4) ( 258) - ( 11,970) ( 1) ( 10,261) ( 1)
Components of other
comprehensive income that will
be reclassified to profit or loss
8361 Financial statements
translation differences of
foreign operations ( 1,705) - 17,275 3 ( 6,614) - ( 169) -
8360 Components of other
comprehensive income that
will be reclassified to profit
or loss ( 1,705) - 17,275 3 ( 6,614) - ( 169) -
8300 Total other comprehensive
(loss) income for the period ($ 17,865) ( 4) $ 17,017 3 ($ 18,584) ( 1) ($ 10,430) ( 1)
8500 Total comprehensive income for
the period $ 4,114 1 $ 58,905 10 $ 53,381 4 $ 76,831 5
Profit (loss), attributable to:
8610 Owners of parent $ 23,741 5 $ 38,635 6 $ 77,836 5 $ 88,199 6
8620 Profit (loss), attributable to :
Non-controlling interests ( 1,762) - 3,253 1 ( 5,871) - ( 938) -
Total $ 21,979 5 $ 41,888 7 $ 71,965 5 $ 87,261 6
Comprehensive income
attributable to:
8710 Owners of parent $ 6,128 1 $ 53,592 9 $ 60,789 5 $ 78,456 5
8720 Non-controlling interests ( 2,014) - 5,313 1 ( 7,408) ( 1) ( 1,625) -
Total $ 4,114 1 $ 58,905 10 $ 53,381 4 $ 76,831 5
Basic earnings per share 6(29)
9750 Basic earnings per share $ 0.32 $ 0.52 $ 1.05 $ 1.19
9850 Diluted earnings per share $ 0.32 $ 0.52 $ 1.05 $ 1.19
----- End of picture text -----

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 NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020 (Expressed in thousands of New Taiwan dollars) (UNAUDITED)

==> picture [790 x 381] intentionally omitted <==

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Equity attributable to owners of the parent
Retained earnings Other equity interest
Unrealised
gains (losses)
Financial from financial
statements assets measured
translation at fair value
Capital surplus, Unappropriated differences of through other
Share capital - additional paid- retained foreign comprehensive Non-controlling
Notes common stock in capital Legal reserve Special reserve earnings operations income Treasury shares Total interests Total equity
Nine months ended September 30,
2020
Balance at January 1, 2020 $ 741,389 $ 1,193,024 $ 280,161 $ 88,059 $ 1,303,340 ($ 95,167 ) ($ 24,314 ) ($ 526 ) $ 3,485,966 $ 111,923 $ 3,597,889
Profit (loss) for the period - - - - 88,199 - - - 88,199 ( 938 ) 87,261
Other comprehensive income (loss) 6(3)
for the period - - - - - 518 ( 10,261 ) - ( 9,743 ) ( 687 ) ( 10,430 )
Total comprehensive income (loss)
for the period - - - - 88,199 518 ( 10,261 ) - 78,456 ( 1,625 ) 76,831
Appropriation and distribution of 6(20)
2019 earnings
Legal reserve - - 37,634 - ( 37,634 ) - - - - - -
Special reserve - - - 31,421 ( 31,421 ) - - - - - -
Cash dividends - - - - ( 148,248 ) - - - ( 148,248 ) - ( 148,248 )
Balance at September 30, 2020 $ 741,389 $ 1,193,024 $ 317,795 $ 119,480 $ 1,174,236 ($ 94,649 ) ($ 34,575 ) ($ 526 ) $ 3,416,174 $ 110,298 $ 3,526,472
Nine months ended September 30,
2021
Balance at January 1, 2021 $ 741,389 $ 1,193,259 $ 317,795 $ 119,480 $ 1,203,831 ($ 75,596 ) ($ 29,615 ) ($ 526 ) $ 3,470,017 $ 115,644 $ 3,585,661
Profit (loss) for the period - - - - 77,836 - - - 77,836 ( 5,871 ) 71,965
Other comprehensive loss for the 6(3)
period - - - - - ( 5,077 ) ( 11,970 ) - ( 17,047 ) ( 1,537 ) ( 18,584 )
Total comprehensive income (loss)
for the period - - - - 77,836 ( 5,077 ) ( 11,970 ) - 60,789 ( 7,408 ) 53,381
Appropriation and distribution of 6(20)
2020 earnings
Legal reserve - - 11,779 - ( 11,779 ) - - - - - -
Special reserve - - - ( 14,268 ) 14,268 - - - - - -
Cash dividends - - - - ( 148,248 ) - - - ( 148,248 ) - ( 148,248 )
Balance at September 30, 2021 $ 741,389 $ 1,193,259 $ 329,574 $ 105,212 $ 1,135,908 ($ 80,673 ) ($ 41,585 ) ($ 526 ) $ 3,382,558 $ 108,236 $ 3,490,794
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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 NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars) (UNAUDITED)

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) loss on financial assets or liabilities at
fair value through profit or loss
Interest expense
Interest income
Government grant
Dividend income
Gain on disposal of property, plant and
equipment
Impairment loss
Unrealised foreign exchange (gain) loss
Changes in operating assets and liabilities
Changes in operating assets
Notes receivable, net
Accounts receivable, net
Other receivables
Inventories
Other current assets
Other non-current assets
Changes in operating liabilities
Contract liabilities - current
Notes payable
Accounts payable
Other payables
Other current liabilities
Cash inflow generated from operations
Interest received
Interest paid
Dividend received
Income taxes paid
Net cash flows from operating activities		 Nine months ended September 30
Notes
2021
2020
$
102,387
$
139,758
6(26)
246,086
223,614
6(26)
4,216
3,393
6(26)
5,322
5,602
12(2)
1,928
1,468
6(24)
(
25,283 )
2,609
6(25)
13,977
10,951
6(22)
(
2,150 ) (
7,658 )
6(16)
(
676 )
-
6(23)
(
4,036 ) (
4,036 )
6(24)
(
1,083 ) (
275 )
6(24)
-
56,522
(
6,507 )
15,372
(
52,566 ) (
32,815 )
157,957
200,416
(
2,587 ) (
1,169 )
(
23,561 ) (
38,841 )
(
2,272 ) (
13,087 )
-
4,405
(
932 )
6,851
(
35,766 ) (
3,671 )
(
99,760 ) (
1,256 )
(
52,597 ) (
37,559 )
218
121
222,315
530,715
2,462
9,344
(
14,130 ) (
11,299 )
4,036
4,036
(
16,443) (
8,590)
198,240
524,206

(Continued)

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Y.C.C. PARTS MFG. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

(UNAUDITED)

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of financial assets at fair value through
profit or loss
Proceeds from disposal of financial assets at fair
value through profit or loss
Decrease (increase) in financial assets at amortised
cost
Acquisition of property, plant and equipment
Payment for capitalized interest
Gain on disposal of property, plant and equipment
Acquisition of intangible assets
Acquisition of use-of-right assets
Decrease in other current assets
Increase in other non-current assets
(Increase) decrease in refundable deposits
Net cash flows used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in short-term borrowings
Decrease in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Repayment of principal portion of lease liabilities
Increase in guarantee deposits received
Cash dividends paid
Net cash flows used in financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period		 Nine months ended September 30
Notes
2021
2020
($
102,121 ) ($
15,379 )
20,987
19,286
12,722
(
268,102 )
6(30)
(
129,195 ) (
81,866 )
6(8)
(
1,627 ) (
2,330 )
2,073
275
6(11)
(
1,432 ) (
4,000 )
6(9)
-
(
32,819 )
19,351
33,940
(
43,574 ) (
119,687 )
(
15 )
12
(
222,831 ) (
470,670 )
749,128
355,651
(
675,514 ) (
170,513 )
75,860
200,100
(
109,626 ) (
317,486 )
6(31)
(
445 )
-
6(31)
-
273
6(31)
(
148,248 ) (
148,248 )
(
108,845 ) (
80,223 )
(
1,050 ) (
16,544 )
(
134,486 ) (
43,231 )
742,410
700,630
$
607,924
$
657,399

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

~10~

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

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

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

(Reviewed, not audited)

1. History and Organisation

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

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

These consolidated financial statements were reported to the Board of Directors on November 12, 2021.

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”) as endorsed by the Financial Supervisory Commission (“FSC”)

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

follows:
Effective date by
International Accounting
New Standards,Interpretations andAmendments StandardsBoard
Amendments to IFRS 4, ‘Extension of the temporary exemption
from applying IFRS 9’		 January 1, 2021
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘
Interest Rate Benchmark Reform— Phase 2’		 January 1, 2021
Amendment to IFRS 16, ‘Covid-19-related rent concessions
beyond 30 June 2021’		 April 1, 2021(Note)
Note: Earlier application from January 1, 2021 is allowed by FSC.
The above standards and interpretations have no significant impact to the Group’s financial condition
and financial performance based on the Group’s assessment.

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

the Group

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

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New Standards,InterpretationsandAmendments Effective date by
International Accounting
StandardsBoard
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.

(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:

NewStandards,Interpretations and Amendments Effective date by
International Accounting
Standards Board
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of
assets between an investor and its associate or joint venture’
IFRS 17, ‘Insurance contracts’
Amendments to IFRS 17, ‘Insurance contracts’
Amendments to IAS 1, ‘Classification of liabilities as current
or non-current’
Amendments to IAS 1, ‘Disclosure of accounting policies’
Amendments to IAS 8, ‘Definition of accounting estimates’
Amendments to IAS 12, ‘Deferred tax related to assets and
liabilities arising from a single transaction’		 To be determined by
International Accounting
Standard Board
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2023
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.

4. Summary of Significant Accounting Policies

The principal accounting policies adopted are consistent with Note 4 in the consolidated financial statements for the year ended December 31, 2020, except for the compliance statement, basis of preparation, basis of consolidation and additional policies as set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(1) Compliance statement

  • A. The consolidated financial statements of the Group have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Accounting Standard 34, ‘Interim financial reporting’ as endorsed by the FSC.

  • B. The consolidated financial statements should be read together with the consolidated financial

~12~

statements for the year ended December 31, 2020.

(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 International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “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:

  • Basis for preparation of these consolidated financial statements are the same as that for the preparation of the consolidated financial statements as of and for the year ended December 31, 2020.

  • B. Subsidiaries included in the consolidated financial statements:

Name of
Investor		 Name of
Subsidiary		 Main Business
Activities		 Ownership(%) September
30,2020

100.00%
100.00%
89.44%		 Description
Note 1
Note 2
September
30,2021		 December 31,
2020
The
Company
The
Company
RISE
BRIGHT		 RISE BRIGHT HOLDINGS
LTD. (RISE BRIGHT)
UNITED SKILLS CO., LTD.
(UNITED SKILLS)
CHINA FIRST HOLDINGS
LTD. (CHINA FIRST)		 Holding company
and selling interior
and exterior
accessories of
Manufacturing
automobiles and
their parts
Holding company
and selling interior
and exterior
accessories of		 100.00%
100.00%
89.44%		 100.00%
100.00%
89.44%

~13~

Name of
Investor		 Name of
Subsidiary		 Main Business
Activities		 Ownership(%) September
30,2020

99.60%
100.00%
82.61%
100.00%		 Description
Note 1
Note 2
Note 2
Note 2
September
30,2021		 December 31,
2020
RISE
BRIGHT
CHINA
FIRST
CHINA
FIRST
CHINA
FIRST		 CHANG JIE
TECHNOLOGY CO., LTD.
(CHANG JIE)
CHANGSHU FUTE
AUTOMOTIVE TRIM CO.,
LTD. (CHANGSHU FUTE)
LIAONING HETAI
AUTOMOTIVE PARTS
CO.,LTD. (LIAONING
HETAI)
CHANGSHU XINXIANG
AUTOMOBILE PARTS CO.,
LTD. (CHANGSHU
XINXIANG)		 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		 99.78%
100.00%
82.61%
100.00%		 99.78%
100.00%
82.61%
100.00%

Note 1: The Board of Directors resolved to increase its capital in the subsidiary, Rise Bright Holdings Ltd., in the amount of US$2 million (NT$57,360 thousand) on August 11, 2020, and then reinvested in Chang Jie Technology Co., Ltd.. The capital was remitted in October 2020. Due to the original shareholders of Chang Jie Technology Co., Ltd. not subscribing proportionately, Rise Bright Holdings Ltd.’s shareholding ratio increased to 99.78%.

  • Note 2: The financial statements of the entity as of and for the nine months ended September 30, 2021 and 2020 were not reviewed by independent auditors as the entity did not meet the definition of significant subsidiaries.

  • C. Subsidiaries not included in the consolidated financial statements

  • None.

  • D. Adjustments for subsidiaries with different balance sheet dates None.

  • E. Significant restrictions

  • None.

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

(4) Employee benefits

Pension cost for the interim period is calculated on a year-to-date basis by using the pension cost rate derived from the actuarial valuation at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant curtailments, settlements, or other significant one-off events. And, the related information is disclosed accordingly.

~14~

(5) Income tax

  - A. The interim period income tax expense is recognised based on the estimated average annual effective income tax rate expected for the full financial year applied to the pretax income of the interim period, and the related information is disclosed accordingly.

  - B. The accounting policy of effect of changes in tax rate from tax regulation amendments for the interim period and the transactions with tax consequences are consistent. The effect is recognised in profit or loss, other comprehensive income or equity immediately in the interim period in which the change occurs.

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

  2. There have been no significant changes as of June 30, 2021. Please refer to Note 5 in the consolidated financial statements for the year ended December 31, 2020.

6. Details of Significant Accounts

(1) 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		 September30,2021
384
$ 295,635
158,510
153,395
607,924
$ 0.13%~0.35%		 December31,2020
374
$ 319,581
207,863
214,592
742,410
$ 0.1%~0.41%		 September30,2020
434
$ 560,022
76,568
20,375
657,399
$ 0.13%~1.52%

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

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

(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
 September30,2021
December31,2020
September30,2020
105,694
$ 20,213
$ 44,918
$ 3,721)
(
1,912)
(
6,234)
(
101,973
$ 18,301
$ 38,684
$ 4,560)
($ 27,305)
($ 10,214)
($
  • A. The Group recognised financial assets and liabilities at fair value through profit or loss of ($13,239),

~15~

  • $5,060, $25,283, and ($2,609) for the three months and nine months ended September 30, 2021 and 2020, respectively.

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

Derivative financial assets (liabilities)
Foreign exchange swap contracts
Derivative financial assets (liabilities)
Foreign exchange swap contracts
Derivative financial assets (liabilities)
Foreign exchange swap contracts		 September30,2021 September30,2021
Contract amount
(Notionalprincipal)		 Contractperiod
Contract amount
(Notionalprincipal)		 Contractperiod
USD 33,210 thousand 2020.09.21 ~ 2020.11.30

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

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

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

Items

Non-current items:
Equity instruments
Listed stocks
Valuation adjustment		 September30,2021
81,856
$ 41,584)
(

40,272
$		 December31,2020
September30,2020
81,856
$ 81,856
$ 29,615)
(
34,575)
(
52,241
$ 47,281
$

  • 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 $40,272, $52,241 and $47,281 as at September 30, 2021, December 31, 2020 and September 30, 2020, 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:

~16~

Three months ended September 30,

Equity instruments at fair value through
other comprehensive income
Fair value change recognised in other
comprehensive loss
(
Cumulative gains reclassified to retained
earnings due to derecognition
Dividend income recognised in profit or loss
Held at end of period
Equity instruments at fair value through
other comprehensive income
Fair value change recognised in other
comprehensive loss
(
Cumulative gains reclassified to retained
earnings due to derecognition
Dividend income recognised in profit or loss
Held at end of period		 2021
2020
16,160)
$ 258)
($ -
$ -
$ 2,993
$ 2,993
$ 2021
2020
11,970)
$ 10,261)
($ -
$ -
$ 2,993
$ 2,993
$ Ninemonths ended September30,

  • C. As at September 30, 2021, December 31, 2020 and September 30, 2020, 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 $40,272, $52,241 and $47,281, respectively.

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

(4) Financial assets at amortised cost

Items

Current items:
Time deposits maturing over
three months
USD bonds sold under repurchase
agreement
Non-current items
Restricted time deposits		 September30,2021
28,365
$ 224,320
252,685
$ 300
$		 December31,2020
S
261,058
$ -
261,058
$ 300
$		 eptember30,2020
423,203
$ -
423,203
$ 327
$
  • A. As at September 30, 2021, December 31, 2020 and September 30, 2020, 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 $252,985, $261,358 and $423,530, respectively.

~17~

  • 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).

(5) Notes and accounts receivable, net

Notes receivable
Less: Allowance for uncollectible
accounts
Accounts receivable
Less: Allowance for uncollectible
accounts
(		 September30,2021
82,198
$ 119)
(

82,079
$ September30,2021
479,084
$ 45,113)


433,971
$		 December31,2020

29,632
$ 79)
(

29,553
$ December31,2020

635,490
$ 43,832)
(

591,658
$		 September30,2020
55,863
$ 168)
(
55,695
$ September30,2020
599,367
$ 44,027)
(
555,340
$
  • A. The aging analysis of notes receivable and accounts receivable are as follows:
Not past due
0~60 days
61~120 days
121~180 days
181-240 days
Over 241 days
Not past due
0~60 days
61~120 days
121~180 days
181-240 days
Over 241 days		 September 30,2021
Notesreceivable
82,198
$ -
-
-
-
-
82,198
$ December		 Accountsreceivable
438,311
$ 13,781
3,025
11,338
227
12,402
479,084
$
31,2020
Notesreceivable
29,632
$ -
-
-
-
-
29,632
$		 Accountsreceivable
562,115
$ 61,842
996
1,701
2,398
6,438
635,490
$

~18~

Not past due
0~60 days
61~120 days
121~180 days
181-240 days
Over 241 days		 September 30,2020
Notesreceivable
55,863
$ -
-
-
-
-
55,863
$		 Accountsreceivable
511,983
$ 57,534
12,772
1,870
6,476
8,732
599,367
$

As of September 30, 2021, December 31, 2020 and September 30, 2020, the ageing analysis was based on past due date.

  • B. As of September 30, 2021, December 31, 2020 and September 30, 2020, the balances of accounts receivable and notes receivable were all from contracts with customers. As of January 1, 2020, the balances of accounts receivable and notes receivable from contracts with customers amounted to $800,271 and $22,948, respectively.

  • C. As at September 30, 2021, December 31, 2020 and September 30, 2020, 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 $82,079, $29,553 and $55,695 as well as $433,971, $591,658 and $555,340, respectively.

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

(6) Inventories

September 30, 2021

September30,2021
Materials and supplies
Work in progress
Semi-finished goods
Finished goods
Merchandise
Total		 Cost
107,331
$ 33,145
24,811
214,875
22,522
402,684
$		 Allowance for
valuation loss
30,277)
($ 4,676)
(
8,291)
(
33,125)
(
-
76,369)
($		 Bookvalue
77,054
$ 28,469
16,520
181,750
22,522
326,315
$

~19~

December 31, 2020

December31,2020
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		 Cost
89,696
$ 62,902
11,255
187,057
22,100
373,010
$		 Allowance for
valuation loss
27,408)
($ 6,192)
(
7,220)
(
29,436)
(
-
70,256)
($ September30,2020		 Bookvalue
62,288
$ 56,710
4,035
157,621
22,100
302,754
$
Cost
107,959
$ 40,308
13,585
192,473
23,480
377,805
$		 Bookvalue
79,676
$ 33,233
8,460
157,879
23,480
302,728
$

The cost of inventories recognised as expense for the period:

2021
2020
Cost of goods sold
334,147
$ 405,346
$ Unallocated fixed overheads
27,323
17,860
Loss on scrapping inventory
373
379
(Gain on reversal of) loss on market value
decline and obsolete and slow-moving
inventories
3,067)
(
4,330
Gain on physical inventory
936)
(
2,566)
(
357,840
$ 425,349
$ 2021
2020
Cost of goods sold
1,010,508
$ 994,505
$ Unallocated fixed overheads
92,286
73,632
Loss on scrapping inventory
1,304
3,025
Loss on market value decline and obsolete
and slow-moving inventories
6,914
13,256
Gain on physical inventory
6,654)
(
8,230)
(
1,104,358
$ 1,076,188
$ Threemonths ended September30,
Ninemonths ended September30,		 Threemonths ended September30, Threemonths ended September30,
2020
405,346
$ 17,860
379
4,330
2,566)
425,349
$
2021
1,010,508
$ 92,286
1,304
6,914
6,654)

(
1,104,358
$		 2020
994,505
$ 73,632
3,025
13,256
8,230)
1,076,188
$

For the three months ended September 30, 2021, the Company reversed a previous inventory writedown which was accounted for as reduction of cost of goods sold because the Company has

~20~

continuously disposed certain inventories and the factors affecting previous recognition of loss on decline in market value have improved.

(7) Other current assets

Prepayments
Other financial assets
Other current assets - others		 September30,2021
59,583
$ 6,862
2,902
69,347
$		 December31,2020

58,982
$ 26,213
1,231
86,426
$		 September30,2020
39,344
$ -
1,678
41,022
$

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

(Remainder of page intentionally left blank)

~21~

(8) Property, plant and equipment

Property, plant and equipment
Ninemonths ended September30,2021
Beginning balance Additions Decreases Transfers Netexchange differences Ending balance
Cost
Land $ 956,365
 $ -
 $ -
 $ -
 $ -
 $ 956,365
Buildings and structures 1,548,691 4,252 ( 5,031)
 1,302 ( 5,395)
 1,543,819
Machinery and equipment 1,207,914 35,566 ( 11,917)
 47,902 ( 5,531)
 1,273,934
Molding equipment 1,678,794 34,047 ( 702)
 181,016 ( 366)
 1,892,789
Transportation equipment 32,456 - ( 24)
 - ( 27)
 32,405
Furniture equipment 3,195 68 ( 132)
 - ( 14)
 3,117
Other equipment 181,056 2,713 ( 7,331)
 568 ( 552)
 176,454
Unfinished construction and
equipment under acceptance 259,837 40,960 - ( 55,780)
 ( 1,157) 243,860
$ 5,868,308
 $ 117,606
 ($ 25,137)
 $ 175,008
 ($ 13,042)
 $ 6,122,743
Accumulated Depreciation
Buildings and structures ($ 767,777)
 ($ 52,327)
 $ 5,012
 $ -
 $ 1,148
 ($ 813,944)
Machinery and equipment ( 779,366)
 ( 72,416)
 10,992 - 2,346 ( 838,444)
Molding equipment ( 1,402,903)
 ( 104,586)
 702 - 168 ( 1,506,619)
Transportation equipment ( 25,534)
 ( 1,742)
 24 - 15 ( 27,237)
Furniture equipment ( 2,449)
 ( 197)
 132 - 7 ( 2,507)
Other equipment ( 123,178) ( 14,121)
 7,285 - 232 ( 129,782)
( 3,101,207) ($ 245,389)
 $ 24,147
 $ -
 $ 3,916
 ( 3,318,533)
Total $ 2,767,101
 $ 2,804,210

~22~

Ninemonths ended Ninemonths ended Ninemonths ended Ninemonths ended September30,2020 September30,2020 September30,2020
Beginning balance Additions Decreases Transfers Netexchange differences Ending balance
Cost
Land $ 956,365
 $ -
 $ -
 $ -
 $ -
 $ 956,365
Buildings and structures 1,519,897 5,770 ( 9,094)
 23,258 ( 1,911)
 1,537,920
Machinery and equipment 1,170,965 16,724 ( 6,556)
 43,193 ( 2,088)
 1,222,238
Molding equipment 1,615,001 18,111 ( 14,524)
 59,061 ( 231)
 1,677,418
Transportation equipment 29,976 905 ( 1,181)
 - ( 9)
 29,691
Furniture equipment 4,438 116 ( 881)
 - ( 15)
 3,658
Other equipment 168,298 15,914 ( 14,269)
 2,738 ( 290)
 172,391
Unfinished construction and
equipment under acceptance 73,826 19,006 - 36,366 ( 499) 128,699
$ 5,538,766 $ 76,546
 ($ 46,505)
 $ 164,616
 ($ 5,043)
 $ 5,728,380
Accumulated Depreciation
Buildings and structures ($ 705,279)
 ($ 52,921)
 $ 9,094
 $ -
 $ 443
 ($ 748,663)
Machinery and equipment ( 749,234)
 ( 72,612)
 6,556 - 1,084 ( 814,206)
Molding equipment ( 1,314,590)
 ( 81,347)
 14,524 - 150 ( 1,381,263)
Transportation equipment ( 24,654)
 ( 1,512)
 1,181 - 8 ( 24,977)
Furniture equipment ( 3,884)
 ( 312)
 881 - 13 ( 3,302)
Other equipment ( 124,220) ( 14,224) 14,269 - 182 ( 123,993)
( 2,921,861) ($ 222,928)
 $ 46,505
 $ -
 $ 1,880
 ( 3,096,404)
$ 2,616,905
 $ 2,631,976

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

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

~23~

  • A. 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:
Amount capitalised
Range of the interest rates
for capitalisation		 September30,2021
1,627
$ 0.81%		 December31,2020

3,333
$ 0.95%		 September30,2020
2,330
$
0.97%

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

  • (9) Lease transactions – lessee

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

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

Land
Transportation equipment
(Business vehicles)
Land
Transportation equipment
(Business vehicles)
Land
Transportation equipment
(Business vehicles)		 September30,2021
December31,2020
September30,2020
Carryingamount
Carryingamount
Carryingamount
136,027
$ 141,079
$ 138,945
$ 4,407
5,589
2,926
140,434
$ 146,668
$ 141,871
$ 2021
2020
Depreciationcharge
Depreciationcharge
1,004
$ 905
$ 346
266
1,350
$ 1,171
$ 2021
2020
Depreciationcharge
Depreciationcharge
3,035
$ 2,595
$ 1,181
798
4,216
$ 3,393
$ Threemonths ended September30,
Ninemonths ended September30,

  • C. For the three months and nine months ended September 30, 2021 and 2020, the additions to rightof-use assets were $0, $0, $0 and $32,819, respectively.

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

~24~

Three months ended September 30,

2021 2020
Items affecting profit or loss
Interest expense on lease liabilities $ 7
 $ -
Expense on short-term lease contracts $ 187
 $ 332
Expense on leases of low-value assets $ 135
 $ 167
Ninemonths ended September30,
2021 2020
Items affecting profit or loss
Interest expense on lease liabilities $ 22
 $ -
Expense on short-term lease contracts $ 611
 $ 807
Expense on leases of low-value assets $ 446
 $ 513
As of September 30, 2021, December 31, 2020 and September 30, 2020, the balances of leas
liabilities -current and lease liabilities - non-current are as follows:
September30, 2021 December 31, 2020 September30,2020
Lease liabilities - current
$		 599
 $ 594
 -
$
Lease liabilities - non-current
$		 1,887
 $ 2,337
 -
$

  • E. As of September 30, 2021, December 31, 2020 and September 30, 2020, the balances of lease liabilities -current and lease liabilities - non-current are as follows:

  • F. For the three months and nine months ended September 30, 2021 and 2020, the Group’s total cash outflow for leases were $478, $499, $1,524 and $1,320, respectively.

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

(10) Investment property

Nine months ended September 30, 2021

Cost
Land use right
Buildings and
structures
Accumulated
depreciation
Land use right
Buildings and
structures		 Beginning
balance
Additions
4,580
$ -
$ 16,218
-
20,798
$ -
$ 575)
($ 93)
($ 3,717)
(
604)
(
4,292)
(
697)
($ 16,506
$		 Net exchange
Ending
Decreases
differences
balance
-
$ 66)
($ 4,514
$ -
235)
(
15,983
-
$ 301)
($ 20,497
$ -
$ 9
$ 659)
($ -
58
4,263)
(
-
$ 67
$ 4,922)
(
15,575
$

~25~

Cost
Land use right
Buildings and
structures
Accumulated
depreciation
Land use right
Buildings and
structures		 Ninemonths ended September30,2020
Beginning
balance
Additions
4,185
$ -
$ 15,947
-
20,132
$ -
$ 123)
($ 93)
($ 2,857)
(
593)
(
2,980)
(
686)
($ 17,152
$
  • A. Rental income from investment property and direct operating expenses arising from investment property are shown below:

Rental income from investment property

  • Direct operating expenses arising from the investment property that generated rental income during the period

  • Direct operating expenses arising from the investment property that did not generate rental income during the period

Rental income from investment property

  • Direct operating expenses arising from the investment property that generated rental income during the period

  • Direct operating expenses arising from the investment property that did not generate rental income during the period

Threemonths ended September30, Threemonths ended September30,
2021
2020
814
$ 792
$ 230
$ 228
$ -
$ -
$ Ninemonths ended September30,		 2020
792
$
228
$
-
$
2021
2,460
$ 697
$ -
$		 2020
2,378
$
686
$
-
$

  • B. The fair value of the investment property held by the Group, which is the land use right and buildings and structures, as at September 30, 2021, December 31, 2020 and September 30, 2020 was $21,121, $19,757 and $20,153, respectively. The valuations were made using the carrying amount of land use rights upon the expiry of the lease and the discounted inflow of future rental income for 3 years, using the borrowing interest rate of 4.15%, after taking into consideration of future economic growth and results of inflation. The fair value is classified as a level 3 fair value.

  • C. CHANGSHU FUTE subleases its 36.5-year land use right in Changshu city, Jiangsu Province, China to DAQIAOJIXIE JIANGSU YOUXIANGONGSI (DAQIAOJIXIE) under non-

~26~

cancellable operating lease agreements. The lease term is 3 years, and rental is adjusted to reflect market rental rates when the lessee exercises extension options. The lessee is not granted the right of priority to buy the investment property when the lease expires. On July 1, 2020, CHANGSHU FUTE re-signed the lease agreement with DAQIAOJIXIE and JIANGSU JIASHENGYU INTELLIGENT TECHNOLOGY., LTD (JIANGSU JIASHENGYU) and the lease term under this agreement is 2.5 years. As CHANGSHU FUTE pledged the buildings and structures as collateral to the Shanghai Pudong Development Bank for loans, it will terminate the agreement early with the DAQIAOJIXIE and JIANGSU JIASHENGYU and pay the relavant compensation if the bank exercises its rights to the pledged collateral and disposes it. D. The future aggregate minimum lease payments receivable are as follows:

Not later than one year
Later than one year but not
later than five years		 September30,2021
3,404
$ 4,478
7,882
$		 December31,2020

3,284
$ 3,448
6,732
$		 September30,2020
3,204
$ 4,182
7,386
$

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

(11) Intangible assets

Nine months ended September 30, 2021

Note 8.
Intangible assets		 Ninemonths ended September30,2021

Cost
Goodwill
Computer software
Accumulated
amortisation

Accumulated impairment
Goodwill

Book value

Cost
Goodwill
Computer software
Accumulated
amortisation

Accumulated impairment
Goodwill

Book value		 Beginning
balance
300,631
$ 17,976
318,607
$ 9,773)
($
300,631)
($ 8,203
$		 Impairment Net exchange
Ending
Additions
Decreases
loss
differences
balance
-
$ -
$ -
$ -
$ 300,631
$ 1,432
106)
(
-
24)
(
19,278
1,432
$ 106)
($ -
$ 24)
($ 319,909
$ 2,650)
($ 106
$ -
$ 10
$ 12,307)
($ -
$ -
$ -
$ -
$ 300,631)
($ 6,971
$ Impairment Net exchange
Ending
Additions
Decreases
loss
differences
balance
-
$ -
$ -
$ 9,290)
($ 307,175
$ 4,000
239)
(
-
7)
(
17,955
4,000
$ 239)
($ -
$ 9,297)
($ 325,130
2,484)
($ 239
$ -
$ 5
$ 8,869)
($ -
$ -
$ 56,522)
($ 8,124
$ 278,833)
($ 37,428
$ Ninemonths ended September30,2020
Beginning
balance
316,465
$ 14,201
330,666
$ 6,629)
($
230,435)
($ 93,602
$

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

~27~

  • B. Goodwill arising from acquisition of CHINA FIRST and CHANGSHU FUTE in April 2015 amounted to US$10,556 thousand and it arose mainly from anticipation of CHANGSHU FUTE that operating revenue will benefit from the growth of the auto parts market in Mainland China. However, the actual operation in CHANGSHU FUTE was not as expected as the auto part market in Mainland China was impacted by the continuous weak economic environment. The Group recognised impairment losses for the goodwill of $56,522 for the nine months ended September 30, 2020.

  • C. The recoverable amount of CHANGSHU FUTE was determined based on value-in-use calculations. These calculations use cash flow projections based on financial budgets approved by the management covering a five-year period and a discount rate of 9.74% per annum in 2020, respectively. Other key assumptions include expected operating revenue and gross profit. These assumptions are based on the cash-generating units’ past operating performance and management’s expectation of the market development. The Group provided accumulated impairment amounting to $300,631 for goodwill in full as of December 31, 2020.

  • (12) Other non-current assets

(12) Other non-current assets
(13)
(14)












Short-term borrowings
Other payables
September30,2021
Prepayments for business
facilities
64,014
$ Guarantee deposits paid
2,293
Others
5,449
71,756
$ Type ofborrowings
September30,2021
Unsecured borrowings
48,884
$ Secured borrowings
354,031
402,915
$ Interest rate range
0.96%~4.15%
September30,2021
Salaries and bonus payable
33,034
$ Machinery and equipment payable
22,958
Employees’ compensation payable
4,699
Directors’ remuneration payable
2,841
Transportation fee payable
5,771
Others
47,028
116,331
$		 September30,2021 December31,2020
148,897
$ 2,278
5,181
156,356
$ December31,2020
71,266
$ 262,130
333,396
$ 2.01%~4.15%
December31,2020
34,920
$ 34,547
5,309
4,010
8,129
47,399
134,314
$		 September30,2020
265,805
$ 1,433
6,045
273,283
$ September30,2020		 September30,2020
64,014
$ 2,293
5,449		 265,805
$ 1,433
6,045
71,756
$		 273,283
$
$ 79,584
$ 356,732
$ 436,316
$
0.97%~4.15%
September30,2020
33,990
$ 24,701
6,551
2,967
-
54,375
122,584
$

~28~

- (15) Long term borrowings

Type of borrowings
Borrowing period
Repayment term
Long-term bank
borrowings
Unsecured borrowings From November
26, 2018 to
November 26,
2023
The loan is fully disbursed once the
contract is signed; interest is
repayable monthly; principal is
repayable monthly in 48
installments with 1-year grace
period on principal only
Unsecured borrowings From August 31,
2016 to February
15, 2023
Starting from August 15, 2019,
principal is repayable quarterly;
interest is repayable monthly
Unsecured borrowings From September
14, 2017 to
September 14,
2022
Starting from October 14, 2018,
principal and interest are repayable
monthly in 48 installments
Unsecured borrowings From December
26, 2019 to
December 26,
2026
The loan is disbursed within three
years after contract is 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,
2016 to January 6,
2031
Principal and interest are repayable
monthly after a 3-year grace period
Secured borrowings
From December
26, 2019 to
September 16,
2028
The loan is disbursed within three
years after contract signed; interest
is repayable monthly; principal is
repayable monthly in 48
installments with a 3-year grace
period on principal only
Less: Current portion
Less: Discount on
government grants

Interest rate range		 September 30,2021
76,334
$ 39,997
6,962
18,300
272,222
269,160
682,975
$ 112,797)
(
4,105)
(
566,073
$ 0.75%~1.9%

~29~

Type of borrowings Borrowing period Repayment term December 31,2020 December 31,2020
Long-term bank
borrowings
Unsecured borrowings From November The loan is fully disbursed once the $ 113,833
26, 2018 to contract is signed; interest is
November 26, repayable monthly; principal is
2023 repayable monthly in 48
installments with 1-year grace
period on principal only
Unsecured borrowings From August 31, Starting from August 15, 2019, 59,998
2016 to February principal is repayable quarterly;
15, 2023 interest is repayable monthly
Unsecured borrowings From April 12, Repayment date is two years after 21,807
2016 to April 14, the borrowing date; interest is
2021 repayable quarterly
Unsecured borrowings From September Starting from October 14, 2018, 12,460
14, 2017 to principal and interest are repayable
September 14, monthly in 48 installments
2022
Unsecured borrowings From December The loan is disbursed within three 18,300
26, 2019 to years after contract is signed;
December 26, interest is repayable monthly;
2026 principal is repayable monthly in 48
installments with a 3-year grace
period on principal only
Secured borrowings From January 6, Principal and interest are repayable 294,097
2016 to January 6, monthly after a 3-year grace period
2031
Secured borrowings From December The loan is disbursed within three 193,300
26, 2019 to years after contract signed; interest
December 26, is repayable monthly; principal is
2026 repayable monthly in 48
installments with a 3-year grace
period on principal only
Secured borrowings From January 6, Starting from February 6, 2016,
2016 to January 6, principal and interest are repayable
2021 monthly 2,500
$ 716,295
Less: Current portion ( 137,261)
Less: Discount on
government grants ( 3,735)
$ 575,299
Interest rate range 0.75%~1.87%

Interest rate range

~30~

Type ofborrowings
Borrowing period
Repayment term
S
Long-term bank
borrowings
Unsecured borrowings
From November
26, 2018 to
November 26,
2023
The loan is fully disbursed once
the contract is signed; interest is
repayable monthly; principal is
repayable monthly in 48
installments with 1-year grace
period on principal only
Unsecured borrowings
From August 31,
2016 to February
15, 2023
Starting from August 15, 2019,
principal is repayable quarterly;
interest is repayable monthly
Unsecured borrowings
From April 12,
2016 to April 14,
2021
Repayment date is two years
after the borrowing date; interest
is repayable quarterly
Unsecured borrowings
From September
14, 2017 to
September 14,
2022
Starting from October 14, 2018,
principal and interest are
repayable monthly in 48
installments
Unsecured borrowings
From December
26, 2019 to
December 26,
2026
The loan is disbursed within
three years after contract is
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,
2016 to January 6,
2031
Principal and interest are
repayable monthly after a 3-year
grace period
Secured borrowings
From December
26, 2019 to
December 26,
2026
The loan is disbursed within
three years after contract 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,
2016 to January
6,2021
Starting from February 6, 2016,
principal and interest are
repayable monthly
Less: Current portion
(
Interest rate range		 eptember30,2020
126,333
$ 66,665
33,456
14,549
18,300
301,389
193,300
10,000
763,992
$ 156,565)

607,427
$ 0.75%~3.65%

~31~

(16) Government grants

As of September 30, 2021, 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 $269,160 and $18,300, respectively, for supporting capital expenditure and working capital. Such loans will mature in September 2028. The fair values for the loans were $262,883 and $17,871, respectively which were calculated at a market rate of 1.25%. The differences between the amount obtained and the fair value were $6,277and $429, 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 was $676 for the nine months ended September 30, 2021.

(17) Pensions

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

  • (b) For the aforementioned pension plan, the Group recognised pension costs of $58, $57, $178 and $171 for the three months and nine months ended September 30, 2021 and 2020, respectively.

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

  • 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

~32~

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 nine months ended September 30, 2021 and 2020 were 16% and 8%, respectively. Other than the monthly contributions, the Group has no further obligations.

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

  • (d) The pension costs under the defined contribution pension plan of the Group for the three months and nine months ended September 30, 2021 and 2020 were $3,937, $1,655, $11,772 and $5,708, respectively.

(18) Share capital

  • A. As of September 30, 2021, the Company’s authorised capital was $1,000,000, constituting 100,000 thousand shares and the paid-in capital was $741,389 with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected.

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

Number of shares as of beginning and
end of the period
 Expressed in thousand shares
Nine months ended September 30,		 Expressed in thousand shares
Nine months ended September 30,
2021
74,124
 2020
74,124

B. Treasury shares

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

September 30, 2021 December 31, 2020 September 30, 2020

Name of
company
holding the
shares		 Reason for
reacquisition		 Number
of
thousand
shares		 Carrying
amount		 Carrying
amount		 Number
of
thousand
shares		 Number
of
thousand
shares		 Carrying
amount		 Number
of
thousand
shares		 Carrying
amount
The Company To be reissued
to employees		 15 526
$		 15 526
$		 15 526
$

~33~

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

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

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

(19) Capital surplus

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

September30,2021
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
$ Difference between consideration
and carrying amount of subsidiaries
acquired
2,035
$ Used to offset accumulated deficits
only (Note 2)
Changes in ownership interests
in subsidiaries
27,926
$		 December31,2020

1,163,298
$ 2,035
$ 27,926
$		 September30,2020
1,163,298
$ 2,035
$ 27,691
$

  • 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.

~34~

(20) Retained earnings

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

  • B. The Company retains some earnings after taking into account the environment, growth stage and long-term financial plan of the Company, and the reminder along with the accumulated unappropriated earnings of prior years can be distributed as shareholders’ bonus, of which the 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 2020 and 2019 earnings have been approved by the shareholders during their meetings on August 30, 2021 and May 29, 2020, respectively. Details are summarised below:

Legal reserve appropriated
Reversal of special reserve
Cash dividend		 Amount
Dividend per
share
(indollars)
11,779
$ 14,268)
(
148,248
2.00
$ YearendedDecember31,2020		 YearendedDecember31,2019 YearendedDecember31,2019
Amount Amount Dividend per
share
(indollars)
11,779
$ 14,268)
(
148,248		 37,634
$ 31,421
148,248		 2.00
$

~35~

The abovementioned appropriation of 2020 earnings had been resolved after meeting the statutory

voting threshold as of May 28, 2021 via the electronic voting platform for shareholders’ meeting.

  • F. Refer to Note 6 (27) for further information relating to employees’ compensation and directors’ and supervisors’ remuneration.

(21) Operating revenue

  • A. Disaggregation of revenue from contracts with customers

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

products:
Auto parts

Others


Auto parts

Others


Auto parts

Others


Auto parts

Others

 Domestic operating
entities
Overseas
operating entities
Total
$ 266,322 $ 184,365
450,687
$ 7,617
4,036
11,653
$ 273,939
$ 188,401
462,340
$ Domestic operating
entities
Overseas
operating entities
Total
$ 331,638 $ 255,772
587,410
$ 6,799
13,512
20,311
$ 338,437
$ 269,284
607,721
$ Domestic operating
entities
Overseas
operating entities
Total
$ 808,413 $ 592,407
1,400,820
$ 23,356
19,535
42,891
$ 831,769
$ 611,942
1,443,711
$ Domestic operating
entities
Overseas
operating entities
Total
$ 882,006 $ 610,756
1,492,762
$ 22,380
14,797
37,177
$ 904,386
$ 625,553
1,529,939
$ Threemonths ended September30,2021
Threemonths ended September30,2020
Ninemonths ended September30,2021
Ninemonths ended September30,2020
Overseas
operating entities
$ 610,756
14,797

$ 625,553		 Total
$ 882,006
22,380
$ 904,386

1,492,762
$ 37,177
1,529,939
$

B. Contract liabilities

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

September 30, 2021 December 31, 2020 September 30, 2020

Contract liabilities:
Contract liabilities - advance
sales receipts		 19,245
$		 20,177
$ 21,177
$

For the three months and nine months ended September 30, 2021 and 2020, revenue recognised

~36~

that were included in the contract liability balance at the beginning of the period amounted to $390, $2,274, $2,653 and $6,534, respectively.

(22) Interest income

Interest income
Interest income from bank deposits
Interest income from bank deposits		 Threemonths ended September30,
2021
2020
526
$ 1,398
$ Ninemonths ended September30,		 2020
1,398
$
2021
2,150
$		 2020
7,658
$

(23) Other income

Other income
Interest income from bank deposits
Interest income from bank deposits		 526
$ 1,398
$ 2021
2020
2,150
$ 7,658
$ Ninemonths ended September30,		 526
$ 1,398
$ 2021
2020
2,150
$ 7,658
$ Ninemonths ended September30,
Rent income
Dividend income
Other income - others
Rent income
Dividend income
Other income - others		 Threemonths ended September30,
2021
2020
2,040
$ 1,337
$ 4,036
4,036
2,608
3,331
8,684
$ 8,704
$ Ninemonths ended September30,		 2020
1,337
$ 4,036
3,331
8,704
$
2021
4,738
$ 4,036
7,728
16,502
$		 2020
4,381
$ 4,036
7,113
15,530
$

~37~

(24) Other gains and losses

Three months ended September 30,

2021 2020
Gains on disposal of property, plant and equipment $ 14
 217
$
Foreign exchange gain (losses) 6,874 ( 26,826)
(Losses) gain on financial assets and liabilities
at fair value through profit or loss		 ( 13,239)
 5,060
Impairment loss - ( 28,826)
Other losses ( 375)
 ( 142)
($ 6,726)
 50,517)
($
Ninemonths ended September30,
2021 2020
Gains on disposal of property, plant and equipment $ 1,083
 275
$
Foreign exchange losses ( 60,196)
 ( 50,421)
Gains (losses) on financial assets and liabilities
at fair value through profit or loss		 25,283 ( 2,609)
Impairment loss - ( 56,522)
Other losses ( 1,457)
 ( 954)
($ 35,287)
 110,231)
($

(25) Finance costs

Finance costs
Interest expense
Less: Capitalization of qualifying assets
(
Interest expense
Less: Capitalization of qualifying assets
(		 2021
2020
5,212
$ 3,243
$ 340)

725)
(
4,872
$ 2,518
$ 2021
2020
15,604
$ 13,281
$ 1,627)

2,330)
(
13,977
$ 10,951
$ Threemonths ended September30,
Ninemonths ended September30,
2021
15,604
$ 1,627)

(
13,977
$

~38~

(26) 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
Employee benefit expense
Depreciation charges on property,
plant and equipment
Depreciation charges on right-of-use assets
Depreciation charges on investment property
Amortisation		 Threemonths ended September30,
2021
2020
80,293
$ 84,520
$ 85,599
75,239
1,350
1,171
230
228
1,633
2,043
169,105
$ 163,201
$ Ninemonths ended September30,		 2020
84,520
$ 75,239
1,171
228
2,043
163,201
$
2021
253,383
$ 245,389
4,216
697
5,322
509,007
$		 2020
239,056
$ 222,928
3,393
686
5,602
471,665
$

(27) Employee benefit expense

Employee benefit expense
Wages and salaries
Labour and health insurance fees
Pension costs
Other personnel expenses		 Threemonths ended September30,
2021
64,802
$ 4,812
3,995
6,684
80,293
$		 2020
72,324
$ 5,161
1,712
5,323
84,520
$

~39~

Wages and salaries
Labour and health insurance fees
Pension costs
Other personnel expenses		 Ninemonths ended September30, Ninemonths ended September30,
2021
205,545
$ 15,806
11,950
20,082
253,383
$		 2020
201,850
$ 14,491
5,879
16,836
239,056
$

  • 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 three months and nine months ended September 30, 2021 and 2020, the accrued employees’ compensation and directors’ remuneration were as follows:

Employees’ compensation
Directors’ remuneration
Employees’ compensation
Directors’ remuneration		 Threemonths ended September30, Threemonths ended September30,
2021
2020
918
$ 2,242
$ 678
1,839
1,596
$ 4,081
$ Ninemonths ended September30,		 2020
2,242
$ 1,839
4,081
$
2021
2,841
$ 2,841
5,682
$		 2020
3,708
$ 2,967
6,675
$

For the nine months ended September 30, 2021 and 2020, the employees’ compensation and directors’ remuneration were estimated and accrued based on 2.5% and 2.5% as well as 2.5% and 2%, respectively, of distributable profit of current year as of the end of reporting period.

  • C. Employees’ compensation and directors’ remuneration of 2020 as resolved by the Board of Directors were in agreement with those amounts recognised in the 2020 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.

~40~

(28) Income tax

A. Income tax (benefit) expense

Components of income tax (benefit) expense

Threemonths ended Threemonths ended September30,
2021 2020
Current tax:
Current tax on profits for the period $ 12,293
 $ 15,376
Deferred tax:
Origination and reversal of
temporary differences ( 189) 5,110
Income tax expense $ 12,104
 $ 20,486
Ninemonths ended September30,
2021 2020
Current tax:
Current tax on profits for the period $ 24,117
 $ 45,565
Tax on undistributed surplus earnings - 7,952
Prior year income tax overestimation ( 398)
 ( 1,847)
Deferred tax:
Origination and reversal of
temporary differences 6,703 827
Income tax expense $ 30,422
 $ 52,497

  • B. The Company’s and domestic subsidiaries’ income tax returns through 2019 have been assessed and approved by the Tax Authority.

  • C. 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. 1101255434 issued by the Ministry of Finance, R.O.C. on July 2, 2021. As of September 30, 2021, the unpaid instalment payments of $21,025 and $36,794, were recognised as income tax liabilities - current and income tax liabilities - non-current.

  • D. The Company incurred an income tax of $48,654 from the 2019 profit-seeking enterprise income tax (including the filing of unappropriated retained earnings of 2018), and applied for the installment payments in accordance with Article 26 of the Tax Collection Act and Decree No.10904533690 issued by the Ministry of Finance, R.O.C. on March 19, 2020. As of September 30, 2021, December 31, 2020 and September 30, 2020, the unpaid instalment payments of $15,355 and $5,369 ； $15,355 and $20,630 ； $15,355 and $24,469, respectively, were recognised as income tax liabilities - current and income tax liabilities - non-current.

~41~

(29) Earnings per share

Earnings per share of ordinary shares:

Basic earnings per share
Profit attributable to ordinary
shareholders of the parent
Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent
Assumed conversion of all
dilutive potential ordinary shares
-Employees’ compensation
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all dilutive
potential ordinary shares
Basic earnings per share
Profit attributable to ordinary
shareholders of the parent
Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent
Assumed conversion of all
dilutive potential ordinary shares
-Employees’ compensation
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all dilutive
potential ordinary shares		 Threemonths ended September Threemonths ended September 30,2021
Weighted average
number of ordinary
shares outstanding
Amount after tax
(share in thousands)
23,741
$ 74,124
23,741
74,124
-
81
23,741
$ 74,205
Threemonths ended September		 Earnings per
share
(in dollars)
0.32
$
0.32
$
30,2020
Amount after tax
(
38,635
$ 38,635
-
38,635
$		 Weighted average
number of ordinary
shares outstanding
sharein thousands)
74,124
74,124
53
74,177		 Earnings per
share
(indollars)
0.52
$
0.52
$

~42~

Basic earnings per share
Profit attributable to ordinary
shareholders of the parent
Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent
Assumed conversion of all
dilutive potential ordinary shares
-Employees’ compensation
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all dilutive
potential ordinary shares
Basic earnings per share
Profit attributable to ordinary
shareholders of the parent
Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent
Assumed conversion of all
dilutive potential ordinary shares
-Employees’ compensation
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all dilutive
potential ordinary shares		 Ninemonths ended September30,2021 Ninemonths ended September30,2021 Ninemonths ended September30,2021
Weighted average
number of ordinary
shares outstanding
Earnings per
share
Amount after tax
(sharein thousands)
(indollars)
77,836
$ 74,124
1.05
$ 77,836
74,124
-
117
77,836
$ 74,241
1.05
$ Ninemonths ended September30,2020		 Earnings per
share
(indollars)
1.05
$
1.05
$
Amount after tax
(
88,199
$ 88,199
-
88,199
$		 Weighted average
number of ordinary
shares outstanding
sharein thousands)
74,124
74,124
118
74,242		 Earnings per
share
(indollars)
1.19
$
1.19
$

~43~

(30) Supplemental cash flow information

Investing activities with partial cash payments:

Supplemental cash flow information
Investing activities with partial cash payments:
Purchase of property, plant and equipment
Add: Opening balance of payable on equipment
and construction
Less: Ending balance of payable on equipment
and construction
(
Cash paid during the period		 2021
2020
117,606
$ 76,546
$ 34,547
30,021
22,958)

24,701)
(
129,195
$ 81,866
$ Ninemonths ended September30,
2021
117,606
$ 34,547
22,958)

(
129,195
$

(Remainder of page intentionally left blank)

~44~

(31) Changes in liabilities from financing activities

Short-term
borrowings
Long-term
borrowings (including
currentportion)
Guarantee
deposits
received
Lease liabilities
(including non-
current)
Dividends
payable
Liabilities from
financing
activities-gross
At January 1, 2021
333,396
$ 712,560
$ 935
$ 2,931
$ -
$ 1,049,822
$ Additions for the period
-
-
-
-
148,248
-
Changes in cash flow from
financing activities
73,614
33,766)
(
-
445)
(
148,248)
(
39,403
Impact of changes in foreign
exchange rate
4,607)
(
382)
(
14)
(
-
-
5,003)
(
Changes in other non-cash
items
512
458
-
-
-
970
At September 30, 2021
402,915
$ 678,870
$ 921
$ 2,486
$ -
$ 1,085,192
$ Short-term
borrowings
Long-term borrowings
(including current
portion)
Guarantee
deposits
received
Dividends
payable
Liabilities from
financing activities-
gross
At January 1, 2020
254,868
$ 886,051
$ 521
$ -
$ 1,141,440
$ Additions for the period
-
-
-
148,248
-
Changes in cash flow
from financing activities
185,138
117,386)
(
273
148,248)
(
68,025
Impact of changes in foreign
exchange rate
593)
(
220)
(
4)
(
-
817)
(
Changes in other non-cash items
3,097)
(
4,453)
(
-
-
7,550)
(
At September 30, 2020
436,316
$ 763,992
$ 790
$ -
$ 1,201,098
$		 Short-term
borrowings		 Long-term
borrowings (including
currentportion)		 Guarantee
deposits
received		 Lease liabilities
(including non-
current)		 Dividends
payable		 Liabilities from
financing
activities-gross
$ (
$

~45~

7. Related Party Transactions

Key management compensation

Related Party Transactions
Key management compensation
Salaries and other short-term employee benefits
Post-employment benefits
Salaries and other short-term employee benefits
Post-employment benefits		 Threemonths ended September30,
2021
2020
4,573
$ 4,993
$ 5
8
4,578
$ 5,001
$ Ninemonths ended September30,		 2020
4,993
$ 8
5,001
$
2021
15,654
$ 15
15,669
$		 2020
14,178
$ 26
14,204
$

8. Pledged Assets

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

Pledged asset

Other financial assets (shown as
other current assets)
Financial assets at amortised cost
- non-current
Property, plant and equipment
Right-of-use assets
Investment property
Total		 Book value September 30,2020
-
$ 327
1,197,752
81,162
16,369
1,295,610
$		 Purpose
September 30,2021
December 31,2020

6,862
$ 26,213
$ 300
300
1,153,839
1,119,594
79,260
82,359
15,575
16,506
1,255,836
$ 1,244,972
$
Guarantee for acceptance
bill
Long-term borrowings
and natural gas for
Short-term borrowings
and long-term borrowings
Short-term borrowings
Short-term borrowings

9. Significant Contingent Liabilities and Unrecognised Contract Commitments

(1) Contingencies

None.

(2) Commitments

As at September 30, 2021, December 31, 2020 and September 30, 2020, the Group’s capital expenditure contracted but not yet incurred in respect of machinery and equipment as well as construction of plants were $384,630, $283,771 and $328,715, respectively.

10. Significant Disaster Loss

None.

11. Significant Events after the Balance Sheet Date

On November 12, 2021, to meet the Group’s operation development, the Board of Directors resolved to increase its capital in the subsidiary, Rise Bright Holdings Ltd., in the amount of US$ 5,300 thousand, of which RMB 10,000 thousand (approximately US$1,560 thousand) would be invested in the secondtier subsidiary, Chang Jie Technology Co., Ltd.

~46~

12. Others

(1) Capital management

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

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

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

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

(2) Financial instruments

  • A. Financial instruments by category
)Financial instruments
A. 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		 September 30,
2021		 December 31,
2020		 September 30,
2020
101,973
$ 40,272
$ 607,924
$ 252,985
82,079
433,971
5,854
6,862
2,293
1,391,968
$		 18,301
$ 52,241
$ 742,410
$ 261,358
29,553
591,658
3,579
26,213
2,278
1,657,049
$		 38,684
$ 47,281
$ 657,399
$ 423,530
55,695
555,340
6,028
-
1,433
1,699,425
$

~47~

Financial liabilities
Financial liabilities at fair value
through profit or loss
Financial liabilities held for trading
Financial liabilities at amortised cost
Short-term borrowings
Notes payable
Accounts payable
Other payables
Long-term borrowings (including
current portion)
Guarantee deposits received
Lease liabilities (including current
portion)		 September 30,
2021		 December 31,
2020		 September 30,
2020
4,560
$ 402,915
$ 84,684
151,343
116,331
678,870
921
1,435,064
$ 2,486
$		 27,305
$ 333,396
$ 118,492
251,103
134,314
716,295
935
1,554,535
$ 2,931
$		 10,214
$ 436,316
$ 109,758
246,520
122,584
763,992
790
1,679,960
$ -
$

  • 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).

  • C. Significant financial risks and degrees of financial risks

  • (a) Market risk

Foreign exchange risk

~48~

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

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

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

(Foreign currency:
functional currency)
Financial assets
Monetary items
USD : NTD
Financial liabilities
Monetary items
USD : RMB		 Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
28,421
$ 27.85
791,525
$ 1,776
$ 6.467
49,462
$ September30,2021		 Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
28,421
$ 27.85
791,525
$ 1,776
$ 6.467
49,462
$ September30,2021		 Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
28,421
$ 27.85
791,525
$ 1,776
$ 6.467
49,462
$ September30,2021
Foreign
currency
amount
(In thousands)		 Exchangerate
28,421
$ 1,776
$		 27.85
6.467		 791,525
$ 49,462
$

~49~

(Foreign currency:
functional currency)
Financial assets
Monetary items
USD : NTD
Financial liabilities
Monetary items
USD : RMB
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD : NTD
RMB : NTD
Financial liabilities
Monetary items
USD : RMB		 Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
31,959
$ 28.48
910,192
$ 3,265
$ 6.52
21,288
$ Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
37,885
$ 29.10
1,102,454
$ 17,325
4.27
73,978
3,900
$ 6.81
113,490
$ December31,2020
September30,2020		 Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
31,959
$ 28.48
910,192
$ 3,265
$ 6.52
21,288
$ Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
37,885
$ 29.10
1,102,454
$ 17,325
4.27
73,978
3,900
$ 6.81
113,490
$ December31,2020
September30,2020		 Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
31,959
$ 28.48
910,192
$ 3,265
$ 6.52
21,288
$ Foreign
currency
amount
(In thousands)
Exchangerate
Book value
(NTD)
37,885
$ 29.10
1,102,454
$ 17,325
4.27
73,978
3,900
$ 6.81
113,490
$ December31,2020
September30,2020
Foreign
currency
amount
(In thousands)		 Exchangerate
Foreign
currency
amount
(In thousands)		 Exchangerate
37,885
$ 17,325
3,900
$		 29.10
4.27
6.81		 1,102,454
$ 73,978
113,490
$

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 three months and nine months ended September 30, 2021 and 2020, amounted to $6,874, ($26,826), ($60,196) and ($50,421), respectively.

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

~50~

(Foreign currency:
functional currency)
Financial assets
Monetary items
USD : NTD
Financial liabilities
Monetary items
USD : RMB
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD : NTD
RMB : NTD
Financial liabilities
Monetary items
USD : NTD		 Ninemonths ended September Ninemonths ended September 30,2021
Sensitivityanalysis
Degree of
variation
Effectonprofitor loss
1%
7,915
$ 1%
495
$ Ninemonths ended September		 Effect on other
comprehensive
income
-
$ -
$ 30,2020
Sensitivityanalysis
Degree of
variation
1%
1%
1%		 Effectonprofitor loss
11,025
$ 740
1,135
$		 Effect on other
comprehensive
income
-
$ -
$

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 three months and nine months ended September 30, 2021 and 2020 would have decreased/increased by $640, $33, $1,020 and $387, 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 $161, $2, $403, and $473, respectively, as a result of other

~51~

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 nine months ended September 30, 2021 and 2020, 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 three months and nine months ended September 30, 2021 and 2020 would have increased/decreased by $339, $428, $814 and $900, respectively. The main factor is that changes in interest expense result in floating-rate borrowings.

  • (b) Credit risk

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

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

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

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

  • v. Impairment loss is assessed and recognized when there is objective evidence that individual receivables cannot be recovered. The Group used historical and timely information to establish loss rate of remaining receivables and used the forecastability to assess the default possibility of accounts receivable. As of September 30, 2021, December 31, 2020 and September 30, 2020, accumulated loss allowance provided for individually assessed receivables amounted to $22,677, $8,681 and $0, respectively. The Group used the forecastability to adjust historical and timely information to assess the default possibility of remaining receivables (including notes receivables). On September 30, 2021, December

~52~

31, 2020 and September 30, 2020, the provision matrix is as follows:

September 30, 2021
Expected loss rate
Total book value
Loss allowance

December 31, 2020
Expected loss rate
Total book value
Loss allowance

September 30, 2020
Expected loss rate
Total book value
Loss allowance
 Not past
due
0%-2%
498,877
$ 5,056)
(

$ 493,821
Not past
due
0%~3%
591,747
$ 17,007)
(

$ 574,740
Not past
due
0%-3%
567,576
$ 15,217)
(

$ 552,359		 1 to 60
days		 61 to 120
days
30%-45%
3,025
$ 1,312)
(
$ 1,713
61 to 120
days
30%~35%
996
$ 329)
(
$ 667
60 to 120
days
60%-70%
12,772
$ 7,855)
(
$ 4,917		 121 to 180
days		 181 to
240 days		 Over 241
days		 Total
7%-20%
13,781
$ 2,580)
(
$ 11,201
1 to 60
days		 100%
978
$ 978)
(
$ -		 100%
227
$ 227)
(
$ -		 100%
12,402
$ 12,402)
(
$ -		 529,290
$ 22,555)
(
$ 506,735
Total
121 to 180
days		 181 to
240 days		 Over 241
days
10%~13%
61,842
$ 7,427)
(
$ 54,415
0 to 60
days		 90%~97%
1,701
$ 1,631)
(
$ 70
120 to 180
days		 (
 100%
2,398
$ 2,398)

$ -		 (
 100%
6,438
$ 6,438)

$ -		 665,122
$ 35,230)
(
$ 629,892
Total
180 to
240days		 Over 240
days
6%-10%
57,534
$ 3,874)
(
$ 53,660		 90%-97%
1,870
$ 1,771)
(
$ 99		 (
 100%
6,746
$ 6,746)

$ -		 (
 100%
8,732
$ 8,732)

$ -		 655,230
$ 44,195)
(
$ 611,035

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

2021

2021
At January 1
Provision for impairment
Effect of foreign exchange
At September 30

At January 1

Provision for impairment

Effect of foreign exchange
At September 30		 Notesreceivable
79
$ 40
-

119
$		 Accountsreceivable
43,832
$ 1,888
607)
(

45,113
$ 2020		 Total
43,911
$ 1,928
607)
(
45,232
$ Total
42,890
1,468
163)
(
44,195
$
Notesreceivable
$ 68
100
-

168
$		 Accountsreceivable
42,822
$ 1,368
163)
(

44,027
$

(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

~53~

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		 September30,2021
500,000
$ 192,540
692,540
$		 December31,2020

300,000
$ 268,400
568,400
$		 September30,2020
350,000
$ 268,400
618,400
$

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:

September 30, 2021
Short-term borrowings
Notes payable
Accounts payable
Other payables
Lease liability
Long-term borrowings
Derivative financial liabilities:		 Less than
1year		 Between
1 and 2
years		 Between
2 and 3
years		 Between
3 and 5
years		 Over 5
years		 Total
408,919
$ 84,684
151,343
116,331
622
118,389
Less than
1year		 $ -
-
-
-
622
93,425
Between
1 and 2
years		 $ -
-
-
-
622
85,895
Between
2 and 3
years		 $ -
-
-
-
674
207,383
Between
3 and 5
years		 $ -
-
-
-
-
200,340
Over 5
years		 408,919
$ 84,684
151,343
116,331
2,540
705,432
Total
September 30, 2021
Foreign exchange swap
contracts		 4,560
$		 $ - $ - $ - $ - 4,560
$

~54~

Non-derivative financial liabilities:

December 31, 2020
Short-term borrowings
Notes payable
Accounts payable
Other payables
Lease liability
Long-term borrowings
Derivative financial liabilities:		 Less than
1year		 Between
1 and 2
years		 Between
2 and 3
years		 Between
3 and 5
years		 Over 5
years		 Total
342,076
$ 118,492
251,103
134,314
622
143,050
Less than
1year		 -
$ -
-
-
622
115,677
Between
1 and 2
years		 -
$ -
-
-
622
86,515
Between
2 and 3
years		 -
$ -
-
-
1,141
169,295
Between
3 and 5
years		 -
$ -
-
-
-
224,663
Over 5
years		 342,076
$ 118,492
251,103
134,314
3,007
739,200
Total
-
$ Between
1 and 2
years		 -
$ Between
2 and 3
years		 -
$ Between
3 and 5
years		 -
$ Over 5
years		 27,305
$ Total
September 30, 2020
Short-term borrowings
Notes payable
Accounts payable
Other payables
Long-term borrowings
Derivative financial liabilities:
447,787
$ 109,758
246,520
122,584
162,871
Less than
1year		 $ -
-
-
-
117,892
Between
1 and 2
years		 $ -
-
-
-
92,648
Between
2 and 3
years		 $ -
-
-
-
169,626
Between
3 and 5
years		 $ -
-
-
-
245,680
Over 5
years		 447,787
$ 109,758
246,520
122,584
788,717
Total
September 30, 2020
Foreign exchange swap
contracts
10,214
$		 $ - $ - $ - $ - 10,214
$

(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

~55~

or liability, either directly or indirectly. The fair value of the Group’s investment in foreign exchange swap contracts is included in Level 2.

Level 3: Unobservable inputs for the asset or liability.

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

  • C. Financial instruments not measured at fair value

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

  • D. The related information of financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities at September 30, 2021, December 31, 2020 and September 30, 2020 are as follows:

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

September 30, 2021
Assets
Recurring fair value measurements
Financial assets at fair value through
profit or loss
Financial assets at fair value through
other comprehensive income
- Equity securities
Recurring fair value measurements
Financial liabilities at fair value through
profit or loss
December 31, 2020
Assets
Recurring fair value measurements
Financial assets at fair value through
profit or loss
Financial assets at fair value through
other comprehensive income
- Equity securities
Liabilities
Recurring fair value measurements
Financial liabilities at fair value through
profit or loss		 Level 1
101,973
$ 40,272
$ -
$ Level 1
18,301
$ 52,241
$ -
$		 Level 2
-
$ -
$ 4,560
$ Level 2
-
$ -
$ 27,305
$		 Level3
-
$ -
$ -
$ Level3
-
$ -
$ -
$		 Total
101,973
$
40,272
$
4,560
$
Total
18,301
$
52,241
$
27,305
$

~56~

September 30, 2020
Assets
Recurring fair value measurements
Financial assets at fair value through
profit or loss
Financial assets at fair value through
other comprehensive income
- Equity securities
Liabilities
Recurring fair value measurements
Financial liabilities at fair value through
profit or loss		 Level 1
38,684
$ 47,281
$ -
$		 Level 2
-
$ -
$ 10,214
$		 Level3
-
$ -
$ -
$		 Total
38,684
$
47,281
$
10,214
$

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

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

Listed shares Market quoted price Closing price

  • ii. Foreign exchange swap contracts are usually valued based on the current foreign exchange swap rate.

  • E. For the nine months ended September 30, 2021 and 2020, there was no transfer between Level 1 and Level 2.

  • F. For the nine months ended September 30, 2021 and 2020, there was no transfer into or out from Level 3.

(4) Other matter

The government established several preventive measures in response to the COVID-19 pandemic, but this had no actual impact on the Company’s operations resulting from the pandemic and the related preventive measures. Additionally, the Company has adopted countermeasures and continued managing the relevant matters to prevent the spread of COVID-19 from affecting its operations.

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.

~57~

  • 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.

~58~

(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:

Domestic operation entities
Foreign operation entities
Others
Inter-segment eliminations
Total amount from
continuing operations
Interest income
Rent income
Dividends income
Other income - others
Impairment loss
Foreign exchange gain (loss)
(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		 Segment revenue Segment revenue Segment revenue Nine months
ended
September 30,
2020		 Segment income(loss) Segment income(loss) Nine months
ended
September 30,
2020
Three months
ended
September 30,
2021		 Three months
ended
September 30,
2020		 Nine months
ended
September 30,
2021		 Three months
ended
September 30,
2021		 Three months
ended
September 30,
2020		 Nine months
ended
September 30,
2021
273,569
$ 185,072
11,653
7,954)
(
462,340
$		 362,995
$ 303,115
1,790
60,179)
(
607,721
$		 824,679
$ 632,209
42,891
56,068)
(
1,443,711
$		 937,463
$ 673,203
8,680
89,407)
(
1,529,939
$		 49,599
$ 22,242)
(
732
8,382
36,471
$ 526
2,040
4,036
2,608
-
6,874
13,239)
(
14
375)
(
4,872)
(
34,083
$		 93,605
$ 3,278
-
8,424
105,307
$ 1,398
1,337
4,036
3,331
28,826)
(
26,826)
(
5,060
217
142)
(
2,518)
(
62,374
$		 159,618
$ 56,148)
(
5,019
24,510
132,999
$ 2,150
4,738
4,036
7,728
-
60,196)
(
25,283
1,083
1,457)
(
13,977)
(
102,387
$		 246,816
$ 28,674)
(
-
19,610
237,752
$ 7,658
4,381
4,036
7,113
56,522)
(
50,421)
(
2,609)
(
275
954)
(
10,951)
(
139,758
$

~59~

Table 1

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

Loans to others

Nine months ended September 30, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

(Note1) Creditor Borrower General ledger
account		 Is a
related
party		 Maximum outstanding
balance during the nine
months ended
September
30,2021(Note 5)		 Balance at September
30, 2021
(Note 7,8 and 9)		 Actual amount
drawn down
(Note2)		 Interestrate Nature of
loan
(Note4)		 Amount of
transactions
with the
borrower		 Reason for
short-term
financing		 Allowance for
doubtfulaccounts		 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		 381,545
$ 197,633
124,845		 194,950
$ 83,550
124,845		 194,950
$ -
122,433		 1.40%
-
4.35%		 2
2
2		 -
$ -
-		 Operating
capital
Operating
capital
Operating
capital		 -
$ -
-		 N
N
N		 -
$ -
-		 338,256
$ 338,256
338,256		 1,353,023
$ 1,353,023
1,353,023		 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 September 30, 2021 and actual amount drawn down were calculated at the USD and RMB buying and selling spot exchange rate of 27.85 and 4.305 on September 30, 2021.

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

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

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

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

Note 5: Loans granted to RISE BRIGHT HOLDINGS LTD. by Y.C.C. whose maximum outstanding balance and balance at September 30, 2021 amounted to NT$381,545 exceed limit on loans granted to a single party. This is because the amount of $381,545 includes $186,595 that was used to repay loans which will be matured in May 2021.Limit on loans maintains $194,950

after repaying from other loans. As of September 30, 2021, the amount that has been used was $194,950.

Note 6: The maximum outstanding balance of loans granted to CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. by Y.C.C. amounted to NT$197,633. This is because the amount of NT$197,633 includes NT$114,083 that was matured on August 11, 2021 and a new facility of NT$83,550 that was added at the Board of Directors’ meeting on March 16, 2021.

Note 7: Loans granted to RISE BRIGHT approved by the Board of Directors amounted to US$7,000 thousand.

Note 8: Loans granted to CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD. approved by the Board of Directors amounted to US$3,000 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

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

Provision of endorsements and guarantees to others

Table 2

Expressed in thousands of NTD (Except as otherwise indicated)

Nine months ended September 30, 2021

Number
(Note 1)		 Endorser/guarantor Partybeingendorsed/guaranteed Partybeingendorsed/guaranteed Limit on endorsements/
guarantees provided for a
single party
(Note 3)		 Maximum outstanding
endorsement/
guarantee
amount as of
September 30,2021		 Outstanding
endorsement/
guarantee amount at
September 30, 2021
(Note 4)		 Actual amount
drawn down
(Note 4)		 Amount of
endorsements/
guarantees
secured with
collateral		 Ratio of accumulated
endorsement/ guarantee
amount to net asset value of
the endorser/guarantor
company		 Ceiling on total
amount of
endorsements/
guarantees provided
(Note 3)		 Provision of
endorsements/guar
antees by parent
company to
subsidiary		 Provision of
endorsements/guarantees
by subsidiary to
parent company		 Provision of
endorsements/guarantees
to the party in Mainland
China		 Footnote
Companyname Relationship with the
endorser/guarantor(Note 2)
0
0		 Y.C.C. PARTS MFG. CO.,
LTD.
Y.C.C. PARTS MFG. CO.,
LTD.		 RISE BRIGHT HOLDINGS
LTD.
CHANGSHU FUTE
AUTOMOTIVE TRIM CO.,
LTD.		 2
3		 676,512
$ 676,512		 12,184
$ 156,796		 6,962
$ 76,588		 6,962
$ 48,738		 -
$ -		 0.21%
2.27%		 1,353,023
$ 1,353,023		 Y
Y		 N
N		 N
Y

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 September 30, 2021 and actual amount drawn down were calculated at the USD buying and selling spot exchange rate of 27.85 on September 30, 2021.

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)

September 30, 2021

Securities held by Marketable securities Relationship with
the securities
issuer		 General ledger account As of Stepember 30,2021 As of Stepember 30,2021 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.
Y.C.C. PARTS MFG. CO., LTD.		 HIROCA HOLDINGS LTD.
TANVEX BIOLOGICS CORPORATION
HIROCA HOLDINGS LTD.
LASTER TECH CO., LTD.
GORDON AUTO BODY PARTS CO., LTD.
SHUN ON ELECTRONIC CO., LTD.
NUUO INC.
DA-LI DEVELOPMENT CO., LTD.		 N
N
N
N
N
N
N
N		 Non-current financial assets at fair value through other comprehensive income -
non current
Valuation adjustment
Current financial assets at fair value through profit or loss
Current 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		 855,000

1,200,000
406,000
475,000
640,000
80,000
5,071
466
 81,856
$ 41,584)
(
40,272
$ 50,400
$ 25,871
19,112
6,233
3,790
277
11
3,721)
(
101,973
$		 1.02%
0.34%
0.48%
0.49%
0.39%
0.05%
0.04%
0.00%		 40,272
$ 54,480
19,122
18,216
6,285
3,660
195
15
101,973
$

Table 3, Page 1

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

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

September 30, 2021

Table 4

Expressed in thousands of NTD (Except as otherwise indicated)

Creditor Counterparty Relationship with
the counterparty		 Balance as at
September 30, 2021
(Note 1)		 Turnover rate
(Note 4)		 Overdue receivables Overdue receivables Amount collected
subsequent to the
balance sheet date
(Note5)		 Allowance for
doubtful accounts		 Footnote
Amount Action taken
Y.C.C. PARTS MFG. CO., LTD.
Y.C.C. PARTS MFG. CO., LTD.		 RISE BRIGHT HOLDINGS LTD.
LIAONING HETAI AUTOMOTIVE PARTS
CO.,LTD		 Subsidiary
Subsidiary		 206,866
$ 125,061		 2.08%
-		 7,969
$ -		 Subsequent collection
-		 3,013
$ -		 -
$ -		 Notes 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 $195,885 from loans to the subsidiary shown as other receivables and revenue from sales of processing machine amounting to $10,982 thoundsand shown as accounts receivable.

Note 3: It pertains to principal and interest aggregating to $123,557 from loans to the subsidiary and technical service expense amounting to $1,504 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 November 9, 2021.

Table 4, Page 1

Table 5

Expressed in thousands of NTD

(Except as otherwise indicated)

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

Significant inter-company transactions during the reporting periods

Nine months ended September 30, 2021

Transaction

Transaction
Number
(Note 1)		 Companyname Counterparty Relationship (Note 2) General ledger account Amount Transaction terms Percentage of consolidated total operating
revenues or total assets
(Note3)
0
0
0
0
1
1
1		 Y.C.C. PARTS MFG. CO., LTD.
Y.C.C. PARTS MFG. CO., LTD.
Y.C.C. PARTS MFG. CO., LTD.
Y.C.C. PARTS MFG. CO., LTD.
CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD.
CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD.
CHANGSHU FUTE AUTOMOTIVE TRIM CO., LTD.		 RISE BRIGHT HOLDINGS LTD.
RISE BRIGHT HOLDINGS LTD.
CHANGSHU FUTE AUTOMOTIVE TRIM CO.,
LTD.
LIAONING HETAI AUTOMOTIVE PARTS
CO., LTD
CHANGSHU XINXIANG AUTOMOBILE
PARTS CO., LTD.
LIAONING HETAI AUTOMOTIVE PARTS
CO., LTD
LIAONING HETAI AUTOMOTIVE PARTS
CO., LTD		 1
1
1
1
3
3
3		 Accounts receivable
Other receivables
Other receivables
Other receivables
Other accrued expenses
Accounts receivable
Sales revenue		 10,982
$ 195,885
13,368
125,061
17,329
11,718
27,818		 90 days after monthly billings
Principal and interest are repayable
at the maturity date
Interest is repayable quarterly
Principal and interest are repayable
at the maturity date
30 days after monthly billings
60 days after monthly billings
60 days after monthly billings		 0.22%
3.86%
0.26%
2.47%
0.34%
0.23%
1.93%

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

Nine months ended September 30, 2021

Expressed in thousands of NTD

(Except as otherwise indicated)

Investor Investee Location Main business activities Initial investment amount Initial investment amount Shares held as at September 30,2021 Shares held as at September 30,2021 Shares held as at September 30,2021 Net profit (loss) of the
investee for the
nine months ended
September 30,2021		 Investment income (loss)
recognised by the
Company for nine months
ended September 30,2021		 Footnote
Balance as at
September 30,2021		 Balance as at
December 31,2020		 Number of shares Ownership (%) Book value
Y.C.C. PARTS MFG. CO., LTD.
Y.C.C. PARTS MFG. CO., LTD.
RISE BRIGHT HOLDINGS LTD.		 UNITED SKILLS CO., LTD.
RISE BRIGHT HOLDINGS LTD.
CHINA FIRST HOLDINGS LTD.		 Taiwan
Samoa
Samoa		 Manufacturing vehicles
and their parts
Holding company
Holding company		 50,000
$ 1,077,179
1,158,673		 50,000
$ 1,077,179
1,158,673		 5,000
-
-		 100.00%
100.00%
89.44%		 49,855
$ 479,935
544,682		 424)
($ 49,703)
(
47,152)
(		 424)
($ 49,703)
(
42,173)
(		 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

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

Information on investments in Mainland China

Nine months ended September 30, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

Amount remitted from Taiwan to

Amount remitted from Taiwan to Amount remitted from Taiwan to
Investee in Mainland China Main business activities Paid-in capital Investment method
(Note 1)		 Accumulated amount
of remittance from
Taiwan
to Mainland China as
of January1,2021		 Mainland China/Amount remitted
back to Taiwan for the nine
months ended September 30,
2021		 Accumulated amount of
remittance from Taiwan
of Mainland China as of
September 30,2021		 Net income of
September 30,
2021		 Ownership held by
the Company
(direct or indirect)		 Investment income (loss)
recognised by the Company
for the nine months ended
September 30,2021(Note 2)		 Book value of
investments in
Mainland China as of
September 30,2021		 Accumulated amount of
investment income remitted
back to Taiwan as of
September 30,2021		 Footnte
Remitted to
Mainland China		 Remitted back
to Taiwan
CHANGSHU FUTE
AUTOMOTIVE TRIM CO.,
LTD.
LIAONING HETAI
AUTOMOTIVE PARTS CO.,
LTD.
CHANGSHU XINXIANG
AUTOMOBILE PARTS CO.,
LTD.
CHANG JIE
TECHNOLOGY CO., LTD.		 Injecting and surface coating air bag
covers of automobiles,producing and
selling various accessories of
automobiles and electronic plastic parts
Injecting and surface coating parts of air
bags with inflation system,covers,
interior and exterior accessories of air
bag and electronic equipment systems
Manufacturing and selling parts, interior
and exterior accessories and
electronic system parts of automobiles
and molds, gauges, clamps and jigs for
injection
Injecting and surface coating air bag
covers of automobiles,producing and
selling various accessories of
automobiles and automatic production
equipments for spraying		 423,150
$ 347,588
60,450
133,225		 2
2
2
2		 827,609
$ 268,009
63,055
134,421		 -
$ -
-
-		 -
$ -
-
-		 827,609
$ 268,009
63,055
134,421		 45,736)
($ 5,057)
(
2,437
5,666)
(		 89.44%
73.89%
89.44%
99.78%		 40,906)
($ 3,736)
(
2,179
5,654)
(		 287,850
$ 185,471
52,945
123,418		 -
$ -
-
-		 Note 5
Note 7
Note 6
Note 4
Note 3

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

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

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

Note 2: The amounts listed in the table denominated in foreign currencies are translated into New Taiwan dollars at the exchange rates at the balance sheet date. Note 3: Paid-in capital is US$4,510 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$4,500 thousand. Note 4: Paid-in capital is US$2,000 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$2,000 thousand. Note 5: Paid-in capital is US$14,000 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$26,300 thousand. Note 6: Paid-in capital is US$11,500 thousand and accumulated amount of remittance from Taiwan to Mainland China is US$8,591 thousand. Note 7: ‘Investment income (loss) recognised by the Company for the nine months ended September 30, 2021 was based on the financial statements that were reviewed by parent company’s CPA.

Companyname Accumulated amount of remittance from
Taiwan to Mainland China as of
September 30,2021		 Investment amount approved by
the Investment Commission of
the Ministry of Economic
Affairs(MOEA)		 Ceiling on investments
in Mainland China
imposed by the
Investment
Commission of
MOEA
Y.C.C. PARTS MFG. CO.,
LTD.		 $ 1,293,094 $ 1,294,050 $ 2,029,535

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$41,391 thousand. The investment amount permitted by the Investment Commission of Ministry of Economic Affairs(MOEA) was US$41,391 thousand.

Table 7, Page 1

Table 8

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

Major shareholders information

September 30, 2021

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 and was calculated by the Taiwan Depository & Clearing Corporation.

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

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

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

Table 8, Page 1

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