ZIPPY - AGM Information 2021 | FinancialReports.eu

ZIPPY TECHNOLOGY CORP. Minutes of 2021 Annual General Shareholders’ Meeting (Translation)

Time and Date: 9:00 am., July 20, 2021

Place: No. 48, Wuquan Rd., Wugu Dist., New Taipei City (Wugo factory of Zippy) Quorum: 85,667,182 shares were represented by shareholders in person and by proxy (including by exercising voting rights electronically: 3,635,363 shares), which are mounted to 56.12% of the Company’s 152,648,688 issued and outstanding shares.

Chairman: Chou, Chin-Wen Recorder: Cheng, Po-Jui

Board Members Present:

Director: Chou, Chin-Wen / Kao, Ming-Chuan / Tsai, Chin-Shan / Shih, Tsun-Te / Lin, Hsien-Chang

Independent Director: Chou, Chai-Fa

Supervisor: Chung, Yen-Yen

Attendance: Kuo, Rou-Lan, CPA / Chen, Howard, Attorney-at-Law

1. Call the Meeting to Order

The Chairman announced that the aggregate shareholding of the shareholders present in person or proxy constituted a quorum. The Chairman called the meeting to order.

2. Chairman Remarks: (Omitted)

3. Report Items:

a. 2020 Business report (Please refer to Appendix 1)
b. Supervisor’s Review Report on the 2020 Financial Statements (Please refer to Appendix 2)
c. The Status of Distribution Remuneration of Employees and Directors in 2020

4. Ratification Items

Proposal: Ratification of the 2020 Business Report and Financial Statements

Explanation:

a. The Company’s 2020 Consolidated and Individual financial statements were audited by the CPA firm of KPMG, and can represent the financial and operating status of the company. Also Business Report and Financial Statements have been approved by the board of directors on 3/8/2021, and examined by the supervisors.
b. The 2020 Business Report, independent auditors’ audit report, and the above-mentioned Financial Statements are attached hereto as Appendix 1 and Appendix 3.
Resolution: Approved and acknowledged as proposed by voting: a total of 77,609,532 shares with voting rights were present when votes were cast.

Result	% ofthe totalvotingrights
The number of voting rights for approval is 77,231,328, among which 3,257,159 was exercised by electronic transmission	99.51%
The number of votes against is 33,254, among which 33,254 was exercised by electronic transmission	0.04%
Thenumberof invalid votesis 0	0.00%
The number of votes abstained is 344,950, among which 344,950 was exercised by electronic transmission	0.44%

Proposal: Adoption of the Proposal for Distribution of 2020 Profits Explanation:

a. The 2020 Profit Distribution had been resolved by the Board of Directors on 3/8/2021.
b. Profit Distribution Table is attached hereto as Appendix 4.
c. Upon the approval of the Annual General Shareholders’ Meeting, it

is proposed that the Board of Directors be authorized to resolve the ex-dividend date, ex-rights date, and other relevant issues.

d. If payout ratio has been changed due to the number of outstanding shares affected by a buyback of common shares or a transfer, conversion, retirement of treasury stocks, it is proposed that the Board of Directors be fully authorized to deal with.
Resolution: Approved and acknowledged as proposed by voting: a total of 77,609,532 shares with voting rights were present when votes were cast.

Result	% of thetotalvotingrights
The number of voting rights for approval is 77,219,700, among which 3,245,531 was exercised by electronic transmission	99.49%
The number of votes against is 45,254, among which 45,254 was exercised by electronic transmission	0.05%
The number of invalid votes is 0	0.00%
The number of votes abstained is 344,578, among which 344,578 was exercised by electronic transmission	0.44%

5. Questions and Motions: None.

6. Adjournment

Meeting adjourned at 9:17 am.

The minutes of this general meeting of shareholders only contain the main points of the meeting, and the contents and procedures of the meeting are still subject to the video records of the meeting.
**In case of any discrepancy between the English version and the Chinese version of the minute of 2021 Annual General Shareholders’ Meeting of ZIPPY TECHNOLOGY CORP., the Chinese version shall prevail.

Appendix

Appendix 1 2020 Business Report of ZIPPY TECHNOLOGY CORP.

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

The Company's Consolidated Balance Sheet on 12/31/20 is as follows:
a. The amount of current assets, including cash and cash equivalents, financial assets measured at fair value through profit or loss, accounts receivable, other receivables, inventories, other current assets, etc., was $2,041,510. The amount of non-current assets, including property, plant and equipment, rightof-use assets, investment property, intangible assets, deferred income tax assets, prepaid equipment payments, refundable deposits and long-term prepaid rent, etc., was $3,526,692. The total amount of total assets was $5,568,202.
b. The amount of current liabilities, including short-term loans, contract liabilities, accounts payable, other payables, current income tax liabilities, lease liabilities, long-term liabilities due within one year or one business cycle and other current liabilities, was $1,041,891. The amount of noncurrent liabilities, including long-term loan, deferred income tax liabilities, lease liabilities, net determined benefit liabilities and guarantee deposits received, etc., was $1,274,688. The total amount of total liabilities was $2,316,579.
c. The total amount of the equity attributable to the owners of the parent company, which included $1,526,487 of common stock, $135,564 in additional paid-in capital, $1,605,789 in retained earnings, and $51,069 in other equity, was $3,216,771. After adding $34,852 of uncontrolled equity, the total amount of total equities was $3,251,623.
The Company’s consolidated Statements of Comprehensive Income for 2020 is as follows:
a. The total amount of consolidated sales revenue was $2,475,359, which included $961,806 of micro-switch and $1,513,553 of power supply. The consolidated sales revenue for the year decreased by $193,772, compared with last year, a decrease of 7.26%.
b. The total amount of operating expenses, which included $1,553,532 of operating costs and $409,714 of operating expenses, was $1,963,246.

c. Non-operating income and expenses included $7,430 of interest income, $118,210 of other income, $60,553 of net losses of other gains and losses, and $21,084 of financial costs. Total non-operating net income was $44,003.
The company's surplus in 2020 is as follows:
a. The annual net operating income was $512,113, accounting for 21% of the sales revenue. The profit before tax was $556,116, accounting for 23% of the sales revenue; the net profit after tax for the current period was $444,452, accounting for 18% of the sales revenue. Compared with last year, net operating income, pre-tax net profit and current net profit decreased by $31,182, $56,225 and $43,488, respectively; the reductions were 5.74%, 9.18% and 8.91%
b. The net after-tax comprehensive income/(loss) was ($8,744), and the total comprehensive income for the period was $435,708, accounting for 18% of operating income. The amount of net profit attributable to the owners of the parent company in the current period was $442,737, and the total amount of comprehensive income attributable to the owners of the parent company was $433,893. Compared with last year, the net profit attributable to the parent company’s owners and the total comprehensive income attributable to the parent company’s owners decreased by $43,652 and $35,504, respectively; the reductions were 8.97% and 7.56%, respectively.
c. The basic earnings per share was 2.90, a decrease of 0.29 from last year's 3.19, a decrease of 9.09%.
d. Looking at it all, the overall operating conditions of the year 2020 have fallen compared with last year due to the impact of the new crown epidemic raging around the world and hitting the economies of all countries. In the coming year, faced with unfavorable factors such as shortage of key components and fluctuations in international exchange rates, the company will maintain a certain degree of competitiveness through timely adjustment of business strategies, increase cost awareness and reduce uncertainties outside the industry in order to provide high quality, short delivery time and innovative products and services to meet the needs of customers and ensure sustainable development and growth in the future.

Chairman: Chou, Chin-Wen President: Kao, Ming-Chuan Accounting officer: Cheng, Po-Jui

Appendix 2

ZIPPY TECHNOLOGY CORP.

Supervisor’s Review Report

The Board of Directors has prepared and submitted to us the Company’s 2020 Business Report, Financial Statements, and proposal for profit distribution. The CPA firm of KPMG was retained to audit ZIPPY’s Financial Statements and has issued an audit report relating to the Financial Statements. The Business Report, Financial Statements, and profit distribution have been reviewed and determined to be correct and accurate by the supervisors of ZIPPY TECHNOLOGY CORP. According to relevant requirements of Article 219 of the Company Law, we hereby submit this report.

ZIPPY TECHNOLOGY CORP.

Supervisor: Chung, Yen-Yen

Supervisor: Su, Chih-Jung Supervisor: Wu, Yu-Chuan

Appendix 3

Independent Auditors’ Report

To the Board of Directors of Zippy Technology Corp.:

Opinion

We have audited the consolidated financial statements of Zippy Technology Corp. and its subsidiaries (“the Group”), which comprise the consolidated statement of financial position as of December 31, 2020 and 2019, and the consolidated statement of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2020 and 2019, and its consolidated financial performance and its consolidated cash flows for the year ended December 31, 2020 and 2019 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards (“IFRSs”), International Accounting Standards (“IASs”), Interpretations developed by the International Financial Reporting Interpretations Committee (“IFRIC”) or the former Standing Interpretations Committee (“SIC”) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audit in accordance with the Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China (“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

1. Account receivables impairment

Please refer to Note 4(g), Note 5(a) and Note 6(c) for accounting policies, significant accounting assumptions and judgments, major sources of estimation uncertainty and related disclosure information for account receivables, respectively.

Description of the key audit matter:

The recovery of accounts receivable is not only affected by the market, but also related to the financial soundness of the customers themselves. It is difficult to assess the signs of impairment of accounts receivable. In the accounts receivable evaluation module, the Group first divides the accounts receivable into groups according to whether they are overdue, calculate the average loss rate of each group in the past five years, and evaluate the current year’s prosperity compared with the previous year. The expected loss rate is adjusted according to changes in the business cycle to recognize the allowance of bad debts. The focus of attention is whether the expected loss rate for impairment is excessively conservative or optimistic. Therefore, the evaluation of account receivables has been identified as a key audit matter.

How the matter was addressed in our audit:

In relation to the key audit matter above, we have performed certain key audit procedures that included understanding the policy for account receivables impairment of the Group to evaluate the suitability of the policy; obtaining the related data from the Group to ensure the process of account receivables impairment is in conformity with the accounting policies; recalculating estimation of account receivables impairment based on the Group’s policies; obtaining the financial disclosure data to evaluate whether the disclosure is appropriate; executing post-period recovery test to evaluate the suitability of allowance of bad debts recognized at balance sheet date.

2. Inventory Obsolescence Evaluation

Please refer to Note 4(h), Note 5(b) and Note 6(e) for accounting policies, significant accounting assumptions and judgments, major sources of estimation uncertainty and related disclosure information for inventory, respectively.

Description of the key audit matter:

The main business items of the Group are power supplies and electronic parts. In addition to sales, there are also manufacturing activities. Precious metals are the main materials. As the international situation changes, the price of precious metals will fluctuate. It directly affects the evaluation of inventory value. In the inventory evaluation model of the Group, the inventory is divided into obsolescent and non-obsolescent inventory, and then evaluated separately. If there is no movement in a certain period, it is classified as obsolescence, and recognized 100% of allowance. The focus of attention is whether the provision of allowances for all obsolescence is excessively conservative, and whether the batch of inventory is completely worthless at the time of disposal. Therefore, the evaluation of inventory obsolescence has been identified as a key audit matter.

How the matter was addressed in our audit:

In relation to the key audit matter above, we have performed certain key audit procedures that included understanding the policy for the provision of allowance for inventory of the Group to evaluate the suitability of the policy; obtaining the related data from the Group to ensure the process of inventory valuation is in conformity with the accounting policies; recalculating estimation of inventory valuation based on the Group’s policies; obtaining the financial disclosure data to evaluate whether the disclosure is appropriate; sampling post-period movement to see whether there is a significant difference between the selling price and the price information used in the evaluation model and to evaluate the suitability of inventory obsolescence losses recognized.

Other Matter

Zippy Technology Corp. has additionally prepared its parent company only financial statements as of and for the years ended December 31, 2020 and 2019, on which we have issued an unqualified opinion.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRSs, IASs, interpretation as well as related guidance endorsed by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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

Those charged with governance (including the Audit Committee or supervisors) are responsible for overseeing the Group’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

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

As part of an audit in accordance with auditing standards generally accepted in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

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

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

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

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

The engagement partners on the audit resulting in this independent auditors’ report are Rou-Lan Kuo and Liu-Fong Yang.

KPMG

Taipei, Taiwan (Republic of China) March 8, 2021

Notes to Readers

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

The independent auditors’ audit report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ audit report and consolidated financial statements, the Chinese version shall prevail.

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

2020.12.3	1	2019.12.	2020.12.3	1	2019.12.	31
Amount	�	Amount	Amount		Amount
				�		�
$ 688,556) 112,793) 36,953 455,818 9,920) 670,125) 67,345)	13) 2) 1) 8) - 12) 1)	977,525) 119,456) 32,072 451,468 10,299 634,630 69,657)	$ 260,539) 13,002) 25,986 374,374 194,072) 107,926) 1,770) 50,000) 14,222	5) - - 7) 4) 2) - 1) -	663,624) 11,681) 36,756 398,227 199,865) 53,474) 2,204) 50,000) 9,364	11) - 1) 7) 3) 1) - 1) -
2,041,510)	37)	2,295,107)
1,263,501) 13,954) 2,151,223) 22,317) 33,227) 41,917 553)	23) - 39) - - 1) -	1,300,482) 17,287) 2,169,456) 22,958) 31,373) 38,646 715)
			1,041,891	19)	1,425,195	24)
			1,208,000 536 3,737 38,070 24,345	22 - - 1) -	1,258,000 450 6,443 42,742 21,218	22 - - 1) -
			1,274,688	23)	1,328,853	23)
			2,316,579	42)	2,754,048	47)
3,526,692)	63)	3,580,917)	1,526,487 135,564 1,605,789 (51,069)	28) 2) 29) (1)	1,526,487 135,568 1,467,487 (41,363)	26) 2) 25) (1)

			3,216,771 34,852	58 -	3,088,179 33,797	52 1
			3,251,623	58	3,121,976	53
$ 5,568,202)	100)	5,876,024)	$ 5,568,202	100	5,876,024	100

The accompanying notes are an integral part of financial statements

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE) ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

For theyears ended December 31,	For theyears ended December 31,	For theyears ended December 31,	For theyears ended December 31,
2020		�	2019	�
$ 2,475,359) 1,553,532) 921,827) 96,519) 234,727) 79,578) (1,110) 409,714) 512,113) 7,430) 118,210) (60,553) (21,084) 44,003) 556,116) 111,664) 444,452) 1,203) (241) 962) (9,706) - (9,706) (8,744) $ 435,708) $ 442,737) 1,715) $ 444,452) $ 433,893) 1,815) $ 444,452) $ $		100) 63)	2,669,131) 1,658,885)	100) 62)
	921,827)	37)	1,010,246)	38)
	96,519) 234,727) 79,578) (1,110)	4) 9) 3) -	136,870) 240,050) 92,443) (2,412)	5) 9) 3) -
	409,714)	16)	466,951)	17)
	512,113)	21)	543,295)	21)
	7,430) 118,210) (60,553) (21,084)	- 5) (2) (1)	8,047) 113,510) (29,997) (22,514)	- 5) (1) (1)
	44,003)	2)	69,046)	3)
	556,116) 111,664)	23) 5)	612,341) 124,401)	24) 5)
	444,452)	18)	487,940)	19)
	1,203) (241)	- -	503) (101)	- -
	962)	-	402)	-
	(9,706) -	- -	(17,445) -	(1) -
	(9,706)	-	(17,445)	(1)
	(8,744)	-	(17,443)	(1)
		18)	470,897)	18)
		18) -	486,389) 1,551)	19) -
		18)	487,940)	19)
		18) -	469,397) 1,500)	18) -
		18)	470,897)	18)
		2.90)		3.19)
		2.89)		3.17)

The accompanying notes are an integral part of financial statements

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE) REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

			Equity attributable to owners ofparent	Equity attributable to owners ofparent	Equity attributable to owners ofparent			Non- Controlling Interests	Total Equity
Capital Stock	Capital Surplus		Retained Earnings			Other Equity	Total Equity Attributable to Owners of Parent
Share Capital		Legal Reserve	Special Reserve	Unappropriated Retained Earnings	Total	Exchange Differences on Translation of Foreign Financial Statements
	135,569)	655,352)	24,991	727,718)	1,408,061)	(23,918)	3,046,199)	35,087)	3,081,286)
- -	- -	- -	- -	486,389) 453)	486,389) 453)	- (17,445)	486,389) (16,992)	1,551) (51)	486,389) (17,043)
-	-	-	-	486,842)	486,842)	(17,445)	469,397)	1,500)	470,897)
- - - - -	- - - (1) -	49,713) - - - -	- - (1,073) - -	(49,713) (427,416) 1,073) - -	- (427,416) - - -	- - - - -	- (427,416) - (1) -	- - - - (2,790)	- (427,416) - (1) (2,790)
1,526,487) - -	135,568) - -	705,065) - -	23,918 - -	738,504) 442,737) 862)	1,467,487) 442,737) 862)	(41,363) - (9,706)	3,088,179) 442,737) (8,844)	33,797) 1,715) 100)	3,121,976) 444,452) (8,744)
-	-	-	-	443,599)	443,599)	(9,706)	443,893)	1,815)	435,708)
- - - - -	- - - (4) -	48,684) - - - -	- 17,444) - - -	(48,684) (17,444) (305,297) - -	- - (305,297) - -	- - - - -	- - (305,297) (4) -	- - - - (760)	- - - (4) (760)
	135,564)	753,749)	41,362	810,678)	1,605,789)	(51,069)	3,216,771)	34,852)	3,251,623)

The accompanying notes are an integral part of financial statements

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

(AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

Cash flows from operating activities: Profit before tax Adjustments: Adjustments to reconcile profit: Depreciation expense Amortization expense Expected credit gain Interest expense Interest income Loss on disposal of property, plant and equipment Gain on lease modification gain Total adjustments to reconcile profit Changes in operating assets and liabilities: Changes in operating assets: Financial assets at fair value through profit or loss, mandatorily measured at fair value Notes receivable Accounts receivable Other receivables Inventories Other current assets Total changes in operating assets Changes in operating liabilities: Contract liabilities Notes payable Accounts payable Other payables Other current liabilities Net defined benefit liabilities, non-current Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow (outflow) generated from operations Interest received Interest paid Income taxes paid Net cash flows from (used in) operating activities Cash flows from investing activities: Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease in guarantee deposits paid Acquisition of intangible assets Increase in prepayments for business facilities Net cash flows (used in) from investing activities Cash flows from financing activities: (Decrease) increase in short-term borrowings Repayments of long-term borrowings Increase in guarantee deposits received Payment of lease liabilities Cash dividends paid Change in non-controlling interests Net cash flows used in (from) financing activities Effect of exchange rate changes on cash and cash equivalents Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	2020 $ 556,116) 75,588) 945) (1,110) 21,084) (7,430) 1,056) (15) 90,118) 7,839) (4,881) (3,224) 34) (35,495) 5,288) (30,439) 262221,321) (10,770) (23,853) (833) 4,858) (4,051) (33,328) (63,767) 26,351) 582,467) 7,775) (21,315) (61,101) 507,826) (17,328) 5,396) 162) (304) (22,261) (34,335) (404,000) (50,000) 3,127) (2,186) (305,301) (760) (759,120) (3,340) (288,969) 977,525) 688,556)	2019
		612,341) 80,300) 902) (2,412) 22,541) (8,047) 1,412) (54)
		94,615)
		163,238) (10,785) 34,629) (46) 138,285) (16,282)
		309,039)
		11,681) (27,047) (105,899) (5,340) (1,971) (14,218)
		(142,794)
		166,245)
		260,860)
		873,201) 7,739) (22,746) (152,869)
		705,325)
		(11,099) 4,6450 880 (1,453) (29,958)
		(37,777)
		390,000) (50,000) 1,010) (2,404) (427,416) (2,790)
		(91,600)
		(4,418)
		571,530) 405,995)
		977,525)

The accompanying notes are an integral part of financial statements

Independent Auditors’ Report

To the Board of Directors of Zippy Technology Corp.:

Opinion

We have audited the financial statements of Zippy Technology Corp.(“the Company”), which comprise the balance sheet as of December 31, 2020 and 2019, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2020 and 2019, and its financial performance and its cash flows for the years ended December 31, 2020 and 2019 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China (“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

1. Account receivables impairment

Please refer to Note 4(f), Note 5(a) and Note 6(c) for accounting policies, significant accounting assumptions and judgments, major sources of estimation uncertainty and related disclosure information for account receivables, respectively.

Description of the key audit matter:

The recovery of accounts receivable is not only affected by the market, but also related to the financial soundness of the customers themselves. It is difficult to assess the signs of impairment of accounts receivable. In the accounts receivable evaluation module, the Company first divides the accounts receivable into groups according to whether they are overdue, calculate the average loss rate of each group in the past five years, and evaluate the current year’s prosperity compared with the previous year. The expected loss rate is adjusted according to changes in the business cycle to recognize the allowance of bad debts. The focus of attention is whether the expected loss rate for impairment is excessively conservative or optimistic. Therefore, the evaluation of account receivables has been identified as a key audit matter. How the matter was addressed in our audit:

In relation to the key audit matter above, we have performed certain key audit procedures that included understanding the policy for account receivables impairment of the Company to evaluate the suitability of the policy; obtaining the related data from the Company to ensure the process of account receivables impairment is in conformity with the accounting policies; recalculating estimation of account receivables impairment based on the Company’s policies; obtaining the financial disclosure data to evaluate whether the disclosure is appropriate; executing post-period recovery test to evaluate the suitability of allowance of bad debts recognized at balance sheet date.

2. Inventory Obsolescence Evaluation

Please refer to Note 4(g), Note 5(b) and Note 6(e) for accounting policies, significant accounting assumptions and judgments, major sources of estimation uncertainty and related disclosure information for inventory, respectively.

Description of the key audit matter:

The main business items of the Company are power supplies and electronic parts. In addition to sales, there are also manufacturing activities. Precious metals are the main materials. As the international situation changes, the price of precious metals will fluctuate. It directly affects the evaluation of inventory value. In the inventory evaluation model of the Company, the inventory is divided into obsolescent and non-obsolescent inventory, and then evaluated separately. If there is no movement in a certain period, it is classified as obsolescence, and recognized 100% of allowance. The focus of attention is whether the provision of allowances for all obsolescence is excessively conservative, and whether the batch of inventory is completely worthless at the time of disposal. Therefore, the evaluation of inventory obsolescence has been identified as a key audit matter.

How the matter was addressed in our audit:

In relation to the key audit matter above, we have performed certain key audit procedures that included understanding the policy for the provision of allowance for inventory of the Company to evaluate the suitability of the policy; obtaining the related data from the Company to ensure the process of inventory valuation is in conformity with the accounting policies; recalculating estimation of inventory valuation based on the Company’s policies; obtaining the financial disclosure data to evaluate whether the disclosure is appropriate; sampling post-period movement to see whether there is a significant difference between the selling price and the price information used in the evaluation model and to evaluate the suitability of inventory obsolescence losses recognized.

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

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

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

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

Auditor’s Responsibilities for the Audit of the Financial Statements

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

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

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

The engagement partners on the audit resulting in this independent auditors’ report are Rou-Lan Kuo and Liu-Fong Yang.

KPMG

Taipei, Taiwan (Republic of China) March 8, 2021

Notes to Readers

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

The independent auditors’ audit report and the accompanying parent company only financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ audit report and parent company only financial statements, the Chinese version shall prevail.

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

ZIPPY TECHNOLOGY CORP. BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

2020.12.3	1	2019.12.	2020.12.3	1	2019.12.	31
Amount	�	Amount	Amount	�	Amount	�
$ 513,715 892 21,129 371,873 86,467 6,809 56,619 507,596 65,747 929	10 - - 7 2 - 1 9 1 -	785,616 34,967 16,089 340,007 168,643 8,984 56,871 463,770 98,943 399	$ 236,000 10,569 24,594 364,775 162,068 23,340 96,447 - 50,000 5,029	4 - 1 7 3 - 2 - 1 -	640,000 7,974 35,030 388,373 165,673 26,697 41,380 450 50,000 4,734	11 - 1 7 3 - 1 - 1 -
1,631,776	30	1,974,289	972,822	18	1,360,311	24
671,055 1,007,615 - 2,057,951 22,317 21,633 41,917 57	12 19 - 38 - - 1 -	620,731 1,020,522 2,245 2,068,193 22,958 20,456 35,997 222	1,208,000 - 34,716 21,532	22 - 1 -	1,258,000 1,805 38,928 18,390	22 - 1 -
			1,264,248	23	1,317,123	23
			2,237,070	41	2,677,434	47
			1,526,487 135,564 1,605,789 (51,069)	28 3 29 (1)	1,526,487 135,568 1,467,487 (41,363)	27 2 25 (1)
3,822,065	70	3,791,324

			3,216,771	59	3,088,179	53
$ 5,453,841	100	5,765,613	$ 5,453,841	100	5,765,613	100

The accompanying notes are an integral part of financial statements

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

ZIPPY TECHNOLOGY CORP.

STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

For theyears ended December 31,	For theyears ended December 31,	For theyears ended December 31,	For theyears ended December 31,
2020		�	2019	�
$ 2,298,188) 1,578,042) 720,146) 25,037) 30,686) 725,795) 45,114) 160,380) 79,578) (167) 284,905) 440,890) 4,582) 100,231) (59,174) (20,690) 72,955) 97,904) 538,794) 96,057) 442,737) 856) 177) (171) 862) (9,706) - (9,706) (8,844) $ 433,893) $ $		100) 69)	2,471,630) 1,681,766)	100) 68)
	720,146) 25,037) 30,686)	31) 1) 1)	789,864) 30,686) 35,160)	32) 1) 1)
	725,795)	31)	794,338)	32)
	45,114) 160,380) 79,578) (167)	2) 7) 3) -	59,995) 171,912) 92,442) (3,066)	2) 7) 4) -
	284,905)	12)	321,283)	13)
	440,890)	19)	473,055)	19)
	4,582) 100,231) (59,174) (20,690) 72,955)	- 4) (2) (1) 3)	6,019) 93,767) (26,746) (21,959) 69,057)	- 4) (1) (1) 3)
	97,904)	4)	120,138)	5)
	538,794) 96,057)	23) 4)	593,193) 106,804)	24) 4)
	442,737)	19)	486,389)	20)
	856) 177) (171)	- - -	677) (88) (136)	- - -
	862)	-	453)	-
	(9,706) -	- -	(17,445) -	(1) -
	(9,706)	-	(17,445)	(1)
	(8,844)	-	(16,992)	(1)
		19)	470,897)	19)
		2.90)		3.19)
		2.89)		3.17)

The accompanying notes are an integral part of financial statements

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE) REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP.

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

Capital Stock	Capital Surplus		Retained Earnings	Retained Earnings		Other Equity	Total Equity
						Exchange Differences on Translation of Foreign Financial Statements
Share Capital		Legal Reserve	Special Reserve	Unappropriated Retained Earnings	Total
	135,569)	655,352)	24,991	727,718)	1,408,061)	(23,918)	3,046,199)
- -	- -	- -	- -	486,389) 453)	486,389) 453)	- (17,445)	486,389) (16,992)
-	-	-	-	486,842)	486,842)	(17,445)	469,397)
- - - -	- - - (1)	49,713) - - -	- - (1,073) -	(49,713) (427,416) 1,073) -	- (427,416) - -	- - - -	- (427,416) - (1)
1,526,487) - -	135,568) - -	705,065) - -	23,918 - -	738,504) 442,737) 862)	1,467,487) 442,737) 862)	(41,363) - (9,706)	3,088,179) 444,452) (8,844)
-	-	-	-	443,599)	443,599)	(9,706)	433,893)
- - - -	- - - (4)	48,684) - - -	- 17,444) - -	(48,684) (17,444) (305,297) -	- - (305,297) -	- - - -	- - - (4)
	135,564)	753,749)	41,362	810,678)	1,605,789)	(51,069)	3,216,771)

The accompanying notes are an integral part of financial statements

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) ZIPPY TECHNOLOGY CORP. STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

Cash flows from operating activities: Profit before income tax Adjustments: Adjustments to reconcile profit before income tax to net cash provided by operating activities: Depreciation expense Amortization expense Expected credit gain Interest expense Interest income Share of profit of subsidiaries, associates and joint ventures accounted for using equity method Loss on disposal of property, plant and equipment Unrealized profit (loss) from sales Realized profit (loss) from sales Other Total adjustments to reconcile profit Changes in operating assets and liabilities: Changes in operating assets: Financial assets at fair value through profit or loss, mandatorily measured at fair value Notes receivable Accounts receivable Accounts receivable due from related parties Other receivables Other receivables due from related parties Inventories Other prepayments Other current assets Total changes in operating assets Changes in operating liabilities: Contract liabilities Notes payable Accounts payable Other payables Other payables due to related parties Other current liabilities Net defined benefit liabilities, non-current Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow (outflow) generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash flows from (used in) operating activities Cash flows from investing activities: Acquisition of property, plant and equipment income Proceeds from disposal of property, plant and equipment Increase in guarantee deposits paid Decrease in other receivables due from related parties Acquisition of intangible assets Increase in prepayments for business facilities Net cash flows (used in) from investing activities Cash flows from financing activities: (Decrease) increase in short-term borrowings Repayments of long-term borrowings Increase in guarantee deposits received Payment of lease liabilities Cash dividends paid Net cash flows (used in) from financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	2020 $ 538,794) 47,035) 945) (167) 20,690) (4,582) (72,955) 701) 25,037) (30,686) 17,175) 3,193) 34,075) (5,040) (31,699) 82,176) 1,882) 252) (43,826) 33,196) (530) 70,486) 262222,595) (10,436) (23,598) (2,618) (3,357) 295) (3,356) (40,475) 30,011) 33,204) 571,998) 4,874) 1,348) (20,920) (42,338) 514,962) (10,561) 359) 165) --- (304) (20,026) (30,367) (404,000) (50,000) 3,142) (337) (305,301) (756,496) (271,901) 785,616) 513,715)	2019
		593,193) 49,949) 902) (3,066) 21,959) (6,019) (69,057) 555) 30,686) (35,160) -
		(9,251)
		182,174) (6,485) 40,791) (17,381) (817) 27,343) 97,781) (39,016) (195)
		284,195)
		7,974) (26,152) (97,667) (2,565) (1,814) 804) (14,107)
		(133,527)
		150,668)
		141,417)
		734,610) 5,717) 4,942) (22,191) (133,899)
		589,179)
		(6,889) 2,1870 (1) 70,6860 (1,454) (26,543)
		37,986)
		390,000) (50,000) 383) (427) (427,416)
		(87,460)
		539,705) 245,911)
		785,616)

The accompanying notes are an integral part of financial statements

Appendix 4

ZIPPY TECHNOLOGY CORP .

Profits Distribution Table

Year 2020

	Unit:NTD$
Items	Total
Beginning retained earnings	367,077,923
Add: Remeasurement of defined benefit obligation	684,902
Add: Other comprehensive income - Long-term investment	177,328
Add: Net profit after tax	442,736,410
Less: Legal Reserve	(44,359,864)
Less: Special Reserve	(9,705,983)
Distributable net profit	756,610,716
Less: Distributable item
Cash dividend to shareholders (NT$2.55 per share)	(389,254,154)
Unappropriated retained earnings	367,356,562

Note 1: Outstanding Shares 152,648,688

AI assistant

ZIPPY — AGM Information 2021

52069_rns_2021-07-26_4e8f0e0b-c1df-4632-b61b-d1563ba339d8.pdf

ZIPPY TECHNOLOGY CORP. Minutes of 2021 Annual General Shareholders’ Meeting (Translation)

1. Call the Meeting to Order

2. Chairman Remarks: (Omitted)

3. Report Items:

4. Ratification Items

Explanation:

Proposal: Adoption of the Proposal for Distribution of 2020 Profits Explanation:

5. Questions and Motions: None.

6. Adjournment

Appendix

Appendix 1

2020 Business Report of ZIPPY TECHNOLOGY CORP.

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

ZIPPY TECHNOLOGY CORP.

Supervisor’s Review Report

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

1. Account receivables impairment

How the matter was addressed in our audit:

2. Inventory Obsolescence Evaluation

Description of the key audit matter:

Other Matter

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

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

KPMG

Notes to Readers

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2020 AND 2019

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

1. Account receivables impairment

2. Inventory Obsolescence Evaluation

Description of the key audit matter:

How the matter was addressed in our audit:

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

Auditor’s Responsibilities for the Audit of the Financial Statements

Notes to Readers

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

ZIPPY TECHNOLOGY CORP. BALANCE SHEETS DECEMBER 31, 2020 AND 2019

ZIPPY TECHNOLOGY CORP.

STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE) REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP.

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) ZIPPY TECHNOLOGY CORP. STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019 (AMOUNTS EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

ZIPPY TECHNOLOGY CORP .

Profits Distribution Table

Year 2020

More from ZIPPY

ZIPPY AGM Information 2021